Document:

<PAGE>

                                                                   EXHIBIT 10.12

                            SECURITIES PURCHASE AGREEMENT

                              DATED AS OF MAY 10, 2000

                                       AMONG

                           INTERNET SPORTS NETWORK, INC.

                                        AND

                         THE PURCHASERS LISTED ON EXHIBIT A

<PAGE>

                                  TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                     PAGE
                                                                                     ----
<S>             <C>                                                                   <C>
ARTICLE I           Purchase and Sale of Securities. . . . . . . . . . . . . . . . . . .1

    Section 1.1     Purchase and Sale of Debentures and Warrants . . . . . . . . . . . .1
    Section 1.2     The Conversion Shares. . . . . . . . . . . . . . . . . . . . . . . .
    Section 1.3     The Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
    Section 1.4     Purchase Exempt from Registration. . . . . . . . . . . . . . . . . .1

ARTICLE II      Representations and Warranties . . . . . . . . . . . . . . . . . . . . .2

    Section 2.1     Representation and Warranties of the Company . . . . . . . . . . . .2
    Section 2.2     Representations and Warranties of the
                    Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

ARTICLE III     Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

    Section 3.1     Securities Compliance. . . . . . . . . . . . . . . . . . . . . . . 14
    Section 3.2     Registration and Listing . . . . . . . . . . . . . . . . . . . . . 15
    Section 3.3     Inspection Rights. . . . . . . . . . . . . . . . . . . . . . . . . 15
    Section 3.4     Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . 15
    Section 3.5     Keeping of Records and Books of Account. . . . . . . . . . . . . . 15
    Section 3.6     Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . 15
    Section 3.7     Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
    Section 3.8     Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . 16
    Section 3.9     Distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
    Section 3.10    Regulation S . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
    Section 3.11    Subsequent Financing . . . . . . . . . . . . . . . . . . . . . . . 16
    Section 3.12    Reservation of Shares. . . . . . . . . . . . . . . . . . . . . . . 17
    Section 3.13    Transfer Agent Instructions. . . . . . . . . . . . . . . . . . . . 17
    Section 3.14    Amendment of Articles to Authorize Preferred Stock . . . . . . . . 17
    Section 3.15    Registration of Conversion Shares. . . . . . . . . . . . . . . . . 17
    Section 3.16    Exchange Agreement . . . . . . . . . . . . . . . . . . . . . . . . 19

    ARTICLE IV       Conditions. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
    Section 4.1     Conditions Precedent to the Obligation of the Company
                    to Sell the Debentures and Warrants  . . . . . . . . . . . . . . . 20
    Section 4.2     Conditions Precedent to the Obligation of the Purchasers
                    to Purchase the Debentures and Warrants. . . . . . . . . . . . . . 20

ARTICLE V       Legends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

    Section 5.1     Legend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

ARTICLE VI      Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

    Section 6.1     General Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . 24

                                       i
<PAGE>

                                     Table of Contents
                                     -----------------
                                        (continued)

                                                                                     PAGE
                                                                                     ----

    Section 6.2     Indemnification Procedure. . . . . . . . . . . . . . . . . . . . . 24

ARTICLE VII     Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

    Section 7.1     Fees and Expenses. . . . . . . . . . . . . . . . . . . . . . . . . 25
    Section 7.2     Specific Enforcement, Consent to Jurisdiction. . . . . . . . . . . 25
    Section 7.3     Entire Agreement; Amend. . . . . . . . . . . . . . . . . . . . . . 26
    Section 7.4     Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
    Section 7.5     Waivers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
    Section 7.6     Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
    Section 7.7     Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . 27
    Section 7.8     No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . 28
    Section 7.9     Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . 28
    Section 7.10    Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
    Section 7.11    Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
    Section 7.12    Publicity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
    Section 7.13    Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
    Section 7.14    Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . 28

</TABLE>

                                       ii
<PAGE>
                            SECURITIES PURCHASE AGREEMENT

       THIS SECURITIES PURCHASE AGREEMENT (the "Agreement") is dated as of May
10, 2000 by and among Internet Sports Network, Inc., a Florida corporation (the
"Company"), and each of the Purchasers of 5% Redeemable Convertible Debentures
of the Company whose names are set forth on Exhibit A hereto (individually, a
"Purchaser" and collectively, the "Purchasers").

       The parties hereto agree as follows:

                                     ARTICLE I

                          PURCHASE AND SALE OF SECURITIES

              Section 1.1   PURCHASE AND SALE OF DEBENTURES AND WARRANTS. Upon
the terms and conditions set forth in this Agreement, the Company shall issue
and sell to the Purchasers for delivery at the respective addresses of the
Purchasers, against payment to the Company of the respective amounts set forth
opposite the Purchasers' names in Exhibit A hereto:

              (a)    up to $1,956,082 aggregate principal amount of the
Company's Redeemable Convertible Debentures, in the form attached hereto as
Exhibit B (the "Debentures"), bearing an initial interest rate of 5% per annum
(subject to increase under specific conditions) and maturing on May 9, 2003 (the
"Maturity Date").  The Debentures shall be convertible into shares (the
"Conversion Shares") of the Company's common stock, par value $0.001 per share
(the "Common Stock") at the Conversion Price (as defined in the Debentures) and
in the manner provided for in the Debentures.  The term "Debentures" as used
herein shall include the Debentures originally issued pursuant to the provisions
of this Agreement and any debentures delivered in substitution or exchange
therefor; and

              (b)    warrants, in the form attached hereto as Exhibit C (the
"Warrants"), to purchase up to 585,000 shares (the "Warrant Shares") of the
Company's Common Stock, which Warrants shall expire on the fifth anniversary of
the issuance date of such Warrants.

              Section 1.2   THE CONVERSION SHARES AND WARRANT SHARES.  The
Company has authorized and has reserved and covenants to continue to reserve a
sufficient number of its authorized but unissued shares of Common Stock, to
effect the conversion of the Debentures and the exercise of the Warrants.  The
Conversion Shares and the Warrant Shares are sometimes  collectively referred to
as the "Shares."

              Section 1.3   CLOSING.

              (a)    The closing of the purchase and sale of the Debentures and
Warrants to be acquired by the Purchasers from the Company under this Agreement
shall take place at the offices of Parker Chapin LLP, The Chrysler Building, 405
Lexington Avenue, New York, New York 10174 at 10:00 a.m. E.S.T. (i) on the date
on which the last to be fulfilled or waived of the conditions set forth in
Article IV hereof and applicable to the Closing shall be fulfilled or waived

                                       1
<PAGE>

in accordance herewith or (ii) such other time and place or on such date as
the Purchasers and the Company may agree upon (the "Closing Date").  Each
party shall deliver all documents, instruments and writings required to be
delivered by such party pursuant to this Agreement at or prior to the Closing
Date.

              (b)    The Company acknowledges receipt from Aspen
International, Ltd. ("Aspen") and Tonga Partners, LP ("Tonga") of payment for
their respective pro rata portion of the Debentures and Warrants, as
evidenced by two promissory notes issued by the Company in favor of each of
Aspen and Tonga for the principal amount of $250,000 each (the "Promissory
Notes").  At the Closing, the Company shall exchange each Promissory Note for
(i) Debentures in the principal amount equal to the total amount of principal
and interest accrued and outstanding under such Promissory Note on the
Closing Date and (ii) Warrants exercisable for up to 75,000 shares of the
Common Stock.

              (c)    On or before the Closing Date, (a) the Company shall
execute and deliver to the escrow agent (the "Escrow Agent") identified in the
form of Escrow Agreement attached hereto as Exhibit I (the "Escrow Agreement")
all applicable agreements, documents, instruments and writings required pursuant
to Section 4.2 herein (collectively, the "Closing Documents"), to be delivered
by the Company including, without limitation, instruments for Debentures in the
principal amount and Warrants exercisable for the number of shares of Common
Stock set forth opposite each Purchaser's name on Exhibit A, as applicable, and
(b) each of the Purchasers shall pay by wire transfer of immediately available
funds into escrow in accordance with the Escrow Agreement such Purchaser's
Purchase Price, as applicable, and execute and deliver all applicable
agreements, documents, instruments  and writings required pursuant to Section
4.1, to be delivered by such Purchaser.  In regard to the Closing, the Escrow
Agent shall give notice (by telephone or other means) (an "Escrow Agent Notice")
to the parties hereto when the Escrow Agent has received all of the Closing
Documents and wire transfer the funds constituting the Purchase Price and
deliver the other Closing Documents to the Company pursuant to the terms of the
Escrow Agreement.  As soon thereafter as is practicable on the Closing Date, the
Escrow Agent shall deliver the Company's Closing Documents to the Purchasers,
including applicable instruments representing the Debentures and Warrants being
purchased.

              Section 1.4   PURCHASE EXEMPT FROM REGISTRATION UNDER THE
SECURITIES LAWS.  The Company and the Purchasers are executing and delivering
this Agreement in accordance with and in reliance upon the exemption from
securities registration afforded by Rule 506 of Regulation D ("Regulation D") as
promulgated by the Commission under the Securities Act of 1933, as amended (the
"Securities Act").

                                     ARTICLE II

                           REPRESENTATIONS AND WARRANTIES

              Section 2.1   REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The
Company hereby makes the following representations and warranties to the
Purchasers, except as set forth in the Company's disclosure schedule delivered
with this Agreement as follows:

                                       2
<PAGE>

              (a)    ORGANIZATION, GOOD STANDING AND POWER.  The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Florida and has the requisite corporate power to own, lease
and operate its properties and assets and to conduct its business as it is now
being conducted.  The Company does not have any subsidiaries except as set forth
on SCHEDULE 2.1(a) hereto.  The Company and each such subsidiary is duly
qualified as a foreign corporation to do business and is in good standing in
every jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary except for any jurisdiction(s)
(alone or in the aggregate) in which the failure to be so qualified will not
have a material adverse effect on the Company's financial condition.

              (b)    AUTHORIZATION; ENFORCEMENT. Except for the Shareholder
Approval (as defined in Section 3.17 hereof) and the filing of the Amendments
(as defined in Section 3.14 hereof), the Company has the requisite corporate
power and authority to enter into and perform this Agreement, the Debentures and
Warrants, the Registration Rights Agreement (as defined in Section 3.15 hereof)
and the Exchange Agreement (as defined in Section 3.16 hereof) (collectively,
the "Transaction Documents") and to issue the Conversion Shares in accordance
with the terms hereof and the Debentures and the Warrant Shares in accordance
with the terms of the Warrants.  Except for the Shareholder Approval and the
filing of the Amendments with the Florida Department of State, the execution,
delivery and performance of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby have been
duly and validly authorized by all necessary corporate action, and, except for
the Shareholder Approval, no further consent or authorization of the Company or
its board of directors or shareholders is required.  Each of the Transaction
Documents have been duly executed and delivered by the Company. Each of the
Transaction Documents constitutes a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, conservatorship, receivership or
similar laws relating to, or affecting generally the enforcement of, creditor's
rights and remedies or by other equitable principles of general application.

              (c)    CAPITALIZATION.  The authorized capital stock of the
Company and the shares thereof currently issued and outstanding as of April 30,
2000 are set forth on SCHEDULE 2.1(c) hereto.  All of the outstanding shares of
the Company's Common Stock have been duly and validly authorized.  Except as set
forth on SCHEDULE 2.1(c) hereto, no shares of Common Stock are entitled to
preemptive rights or registration rights and there are no outstanding options,
warrants, scrip, rights to subscribe to, call or commitments of any character
whatsoever relating to, or securities or rights convertible into, any shares of
capital stock of the Company.  Furthermore, except as set forth in this
Agreement and the Registration Rights Agreement and as set forth on
SCHEDULE 2.1(c), there are no contracts, commitments, understandings, or
arrangements by which the Company is or may become bound to issue additional
shares of the capital stock of the Company or options, securities or rights
convertible into shares of capital stock of the Company.  Except for customary
transfer restrictions contained in agreements entered into by the Company in
order to sell restricted securities or as provided on SCHEDULE 2.1 (c) hereto,
the Company is not a party to any agreement granting registration or anti-
dilution rights to any person with respect to any of its equity or debt
securities.  The Company is not a party to, and it has no knowledge of, any
agreement restricting the voting or transfer of any

                                       3
<PAGE>

shares of the capital stock of the Company. Except as set forth or on
SCHEDULE 2.1(c) hereto, the offer and sale of all capital stock, convertible
securities, rights, warrants, or options of the Company issued prior to the
Closing complied with all applicable Federal and state securities laws, and
no shareholder has a right of rescission or damages with respect thereto
which would have any adverse effect on the business, operations, properties,
prospects, or financial condition of the Company or its subsidiaries and
which is material to such entity or other entities controlling or controlled
by such entity (a "Material Adverse Effect"). The Company has furnished or
made available to the Purchasers true and correct copies of the Company's
Articles of Incorporation as in effect on the date hereof and the Company's
Bylaws as in effect on the date hereof (the "Bylaws").

              (d)    ISSUANCE OF SECURITIES.

                     (i)    The Debentures and Warrants to be issued at the
Closing have been duly authorized by all necessary corporate action and, when
paid for or issued in accordance with the terms hereof and thereof, the
Debentures and Warrants shall be validly issued and outstanding, and entitled to
the rights and preferences set forth therein.  When the Shares are issued in
accordance with the terms of the Debentures or the Warrants, as applicable,
such Shares will be duly authorized by all necessary corporate action and
validly issued and outstanding, fully paid and non-assessable, and the holders
shall be entitled to all rights accorded to a holder of Common Stock.

                     (ii)   Except as set forth on SCHEDULE 2.1(d), no consent,
approval or authorization of any creditor of the Company or other person is
required as a condition to or otherwise in connection with the Company's
execution, delivery or performance of any of its obligations under this
Agreement, the Transaction Documents, the Debentures or the Warrants, or issue
and sell the Debentures, Warrants and the Shares in accordance with the terms
hereof or thereof.

              (e)    NO CONFLICTS.  Except as disclosed in SCHEDULE 2.1(e)
hereto, the execution, delivery and performance of the Transaction Documents by
the Company, the performance by the Company of its obligations under the
Debentures and Warrants and the consummation by the Company of the transactions
contemplated herein and therein do not (i) violate any provision of the
Company's Articles of Incorporation or Bylaws, (ii) conflict with, or constitute
a default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, mortgage, deed of trust,
indenture, note, bond, license, lease agreement, instrument or obligation to
which the Company is a party, (iii) create or impose a lien, charge or
encumbrance on any property of the Company under any agreement or any commitment
to which the Company is a party or by which the Company is bound or by which any
of its respective properties or assets are bound, or (iv) result in a violation
of any Federal, state, local or foreign statute, rule, regulation, order,
judgment or decree (including Federal and state securities laws and regulations)
applicable to the Company or any of its subsidiaries or by which any property or
asset of the Company or any of its subsidiaries are bound or affected, except,
in all cases other than violations pursuant to clause (i) above, for such
conflicts, defaults, terminations, amendments, acceleration, cancellations and
violations as would not, individually

                                       4
<PAGE>

or in the aggregate, have a Material Adverse Effect. The business of the
Company and its subsidiaries is not being conducted in violation of any laws,
ordinances or regulations of any governmental entity, except for possible
violations which singularly or in the aggregate do not and will not have a
Material Adverse Effect.  Except for the Information Statement on Schedule
14C to be filed by the Company with the Commission pursuant to Section 14(c)
of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"),
the Amendments to be filed with the State of Florida and the Shareholder
Approval, the Company is not required under federal, state or local law, rule
or regulation to obtain any consent, authorization or order of, or make any
filing or registration with, any court or governmental agency in order for it
to execute, deliveror perform any of its obligations under the Transaction
Documents and the Debentures and Warrants, as the case may be, or issue and
sell the Debentures, Warrants and the Shares, as the case may be, in
accordance with the terms hereof or thereof (other than any filings which may
be required to be made by the Company with the Commission or state securities
administrators subsequent to the Closing and any registration statement which
may be filed pursuant hereto).

              (f)    COMMISSION DOCUMENTS; FINANCIAL STATEMENTS.  The Common
Stock of the Company is registered under Section 12(b) or 12(g) of the Exchange
Act pursuant to a registration statement on Form 10 filed by the Company with
the Commission in July 1999 and, except as disclosed on SCHEDULE 2.1(f) hereto,
the Company has timely filed all reports, schedules, forms, statements and other
documents required to be filed by it with the Commission pursuant to the
reporting requirements of the Exchange Act, including material filed pursuant to
Section 13(a) or 15(d) of the Exchange Act (all of the foregoing including
filings incorporated by reference therein being referred to herein as the
"Commission Documents").  The Company has delivered or made available to each of
the Purchasers true and complete copies of the Commission Documents filed with
the Commission since April, 1997 (the date of its incorporation). The Company
has not provided to the Purchasers any material non-public information or other
information which, according to applicable law, rule or regulation, was required
to have been disclosed publicly by the Company but which has not been so
disclosed, other than with respect to the transactions contemplated by this
Agreement.  As of their respective dates, the Forms 10-Q for the fiscal quarters
ended each of September 30, 1999 and December 31, 1999 (collectively, the "Forms
10-Q") complied in all material respects with the requirements of the Exchange
Act and the rules and regulations of the Commission promulgated thereunder and
other federal, state and local laws, rules and regulations applicable to such
documents, and, as of their respective dates, none of the Forms 10-Q referred to
above contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.  The financial statements of the Company included in the
Commission Documents comply as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the
Commission or other applicable rules and regulations with respect thereto.  Such
financial statements have been prepared in accordance with generally accepted
accounting principles ("GAAP") applied on a consistent basis during the periods
involved (except (i) as may be otherwise indicated in such financial statements
or the notes thereto or (ii) in the case of unaudited interim statements, to the
extent they may not include footnotes or may be condensed or summary
statements), and fairly present in all material respects the financial position
of the Company and its subsidiaries as of the dates

                                       5
<PAGE>

thereof and the results of operations and cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments).

              (g)    SUBSIDIARIES.  The Forms 10-Q or SCHEDULE 2.1(g) hereto
sets forth each subsidiary of the Company, showing the jurisdiction of its
incorporation or organization and showing the percentage of each person's
ownership of the outstanding stock or other interests of such subsidiary.
For the purposes of this Agreement, "subsidiary" shall mean any corporation
or other entity of which at least a majority of the securities or other
ownership interest having ordinary voting power (absolutely or contingently)
for the election of directors or other persons performing similar functions
are at the time owned directly or indirectly by the Company and/or any of its
other subsidiaries.  All of the outstanding shares of capital stock of each
subsidiary have been duly authorized and validly issued, and are fully paid
and non-assessable.  There are no outstanding preemptive, conversion or other
rights, options, warrants or agreements granted or issued by or binding upon
any subsidiary for the purchase or acquisition of any shares of capital stock
of any subsidiary or any other securities convertible into, exchangeable for
or evidencing the rights to subscribe for any shares of such capital stock.
Neither the Company nor any subsidiary is subject to any obligation
(contingent or otherwise) to repurchase or otherwise acquire or retire any
shares of the capital stock of any subsidiary or any convertible securities,
rights, warrants or options of the type described in the preceding sentence.
Neither the Company nor any subsidiary is party to, nor has any knowledge of,
any agreement restricting the voting or transfer of any shares of the capital
stock of any subsidiary.

              (h)    NO MATERIAL ADVERSE CHANGE.  Since December 31, 1999, the
date through which the most recent quarterly report of the Company on Form 10-Q
has been prepared and filed with the Commission, a copy of which is included in
the Commission Documents, the Company has not experienced or suffered any
Material Adverse Effect, except as disclosed on SCHEDULE 2.1(h) hereto.

              (i)    NO UNDISCLOSED LIABILITIES.  Except as disclosed on
SCHEDULE 2.1(i)  hereto, neither the Company nor any of its subsidiaries has any
liabilities, obligations, claims or losses (whether liquidated or unliquidated,
secured or unsecured, absolute, accrued, contingent or otherwise) other than
those incurred in the ordinary course of the Company's or its subsidiaries
respective businesses since March 31, 1999 and which, individually or in the
aggregate, do not or would not have a Material Adverse Effect on the Company and
its subsidiaries, taken as a whole.

              (j)    NO UNDISCLOSED EVENTS OR CIRCUMSTANCES.  No event or
circumstance has occurred or exists with respect to the Company or its
subsidiaries or their respective businesses, properties, prospects, operations
or financial condition, which, under applicable law, rule or regulation,
requires public disclosure or announcement by the Company but which has not been
so publicly announced or disclosed, excluding any event or circumstance relating
solely to general economic, industry or political factors or conditions.

              (k)    INDEBTEDNESS.  SCHEDULE 2.1(k) hereto sets forth as of the
date hereof all outstanding secured and unsecured Indebtedness of the Company or
any subsidiary, or for which the Company or any subsidiary has commitments.  For
the purposes of this Agreement, "Indebtedness" shall mean (a) any liabilities
for borrowed money or amounts owed in excess of

                                       6
<PAGE>

$25,000 (other than trade accounts payable incurred in the ordinary course of
business), (b) all guaranties, endorsements and other contingent obligations
in respect of Indebtedness of others, whether or not the same are or should
be reflected in the Company's balance sheet (or the notes thereto), except
guaranties by endorsement of negotiable instruments for deposit or collection
or similar transactions in the ordinary course of business; and (c) the
present value of any lease payments in excess of $25,000 due under leases
required to be capitalized in accordance with GAAP.  Neither the Company nor
any subsidiary is in default with respect to any Indebtedness.

              (l)    TITLE TO ASSETS.  Each of the Company and the subsidiaries
has good and marketable title to all of its real and personal property reflected
in the Commission Documents, free of any mortgages, pledges, charges, liens,
security interests or other encumbrances, except for those indicated on
SCHEDULE 2.1(l) hereto or such that, individually or in the aggregate, do not
cause a Material Adverse Effect on the Company's financial condition or
operating results.  All said leases of the Company and each of its subsidiaries
are valid and subsisting and in full force and effect.

              (m)    ACTIONS PENDING.  There is no action, suit, claim,
investigation or proceeding pending or, to the knowledge of the Company,
threatened against the Company or any subsidiary which questions the validity of
this Agreement or the transactions contemplated hereby or any action taken or to
be taken pursuant hereto or thereto.  Except as set forth on SCHEDULE 2.1(m)
hereto, there is no action, suit, claim, investigation or proceeding pending or,
to the knowledge of the Company, threatened, against or involving the Company,
any subsidiary or any of their respective properties or assets.  There are no
outstanding orders, judgments, injunctions, awards or decrees of any court,
arbitrator or governmental or regulatory body against the Company or any
subsidiary or any officers or directors of the Company or subsidiary in their
capacities as such.

              (n)    COMPLIANCE WITH LAW.  The business of the Company and the
subsidiaries has been and is presently being conducted in accordance with all
applicable Federal, state and local governmental laws, rules, regulations and
ordinances, except as set forth on SCHEDULE 2.1(n) hereto or such that,
individually or in the aggregate, do not cause a Material Adverse Effect.  The
Company and each of its subsidiaries have all franchises, permits, licenses,
consents and other governmental or regulatory authorizations and approvals
necessary for the conduct of its business as now being conducted by it unless
the failure to possess such franchises, permits, licenses, consents and other
governmental or regulatory authorizations and approvals, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

              (o)    TAXES.  Except as set forth on SCHEDULE 2.1(o) hereto, the
Company and each of the subsidiaries has accurately prepared and filed all
federal, state and other tax returns required by law to be filed by it, has paid
or made provisions for the payment of all taxes shown to be due and all
additional assessments, and adequate provisions have been and are reflected in
the financial statements of the Company and the subsidiaries for all current
taxes and other charges to which the Company or any subsidiary is subject and
which are not currently due and payable.  None of the federal income tax returns
of the Company or any subsidiary for any fiscal year subsequent to April 1997
have been audited by the Internal Revenue Service.  The

                                       7

<PAGE>

Company has no knowledge of any additional assessments, adjustments or
contingent tax liability (whether federal or state) pending or threatened
against the Company or any subsidiary for any period, nor of any basis for
any such assessment, adjustment or contingency.

              (p)    CERTAIN FEES.  Except as set forth on SCHEDULE 2.1(p)
hereto, no brokers, finders or financial advisory fees or commissions will be
payable by the Company or any subsidiary or any Purchaser with respect to the
transactions contemplated by this Agreement.

              (q)    DISCLOSURE.  To the Company's knowledge, neither this
Agreement or the Schedules hereto nor any other documents, certificates or
instruments furnished to the Purchasers by or on behalf of the Company or any
subsidiary in connection with the transactions contemplated by this Agreement
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made herein or therein, in the light
of the circumstances under which they were made herein or therein, not
misleading.

              (r)    OPERATION OF BUSINESS.  The Company and each of the
subsidiaries owns or possesses all patents, trademarks, service marks, trade
names, copyrights, licenses and authorizations as set forth on SCHEDULE 2.1(r)
hereto, and all rights with respect to the foregoing, which are necessary for
the conduct of its business as now conducted without any conflict with the
rights of others.

              (s)    ENVIRONMENTAL COMPLIANCE.  The Company and each of its
subsidiaries have obtained all material approvals, authorization, certificates,
consents, licenses, orders and permits or other similar authorizations of all
governmental authorities, or from any other person, that are required under any
Environmental Laws. "Environmental Laws" shall mean all applicable laws relating
to the protection of the environment including, without limitation, all
requirements pertaining to reporting, licensing, permitting, controlling,
investigating or remediating emissions, discharges, releases or threatened
releases of hazardous substances, chemical substances, pollutants, contaminants
or toxic substances, materials or wastes, whether solid, liquid or gaseous in
nature, into the air, surface water, groundwater or land, or relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of hazardous substances, chemical substances, pollutants,
contaminants or toxic substances, material or wastes, whether solid, liquid or
gaseous in nature.  The Company has all necessary governmental approvals
required under all Environmental Laws and used in its business or in the
business of any of its subsidiaries.  The Company and each of its subsidiaries
are also in compliance with all other limitations, restrictions, conditions,
standards, requirements, schedules and timetables required or imposed under all
Environmental Laws.  Except for such instances as would not individually or in
the aggregate have a Material Adverse Effect, there are no past or present
events, conditions, circumstances, incidents, actions or omissions relating to
or in any way affecting the Company or its subsidiaries that violate or may
violate any Environmental Law after the Closing or that may give rise to any
environmental liability, or otherwise form the basis of any claim, action,
demand, suit, proceeding, hearing, study or investigation (i) under any
Environmental Law, or (ii) based on or related to the manufacture, processing,
distribution, use, treatment, storage (including without limitation underground
storage tanks), disposal, transport or handling, or the emission, discharge,
release or threatened release of any hazardous substance.  "Environmental
Liabilities" means all liabilities of a person (whether such liabilities are
owed by

                                         8

<PAGE>

such person to governmental authorities, third parties or otherwise) whether
currently in existence or arising hereafter which arise under or relate to
any Environmental Law.

              (t)    BOOKS AND RECORDS; INTERNAL ACCOUNTING CONTROLS.  The
records and documents of the Company and its subsidiaries accurately reflect in
all material respects the information relating to the business of the Company
and the subsidiaries, the location and collection of their assets, and the
nature of all transactions giving rise to the obligations or accounts receivable
of the Company or any subsidiary.  The Company and each of its subsidiaries
maintain a system of internal accounting controls sufficient, in the judgment of
the Company's board of directors, to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate actions is taken
with respect to any differences.

              (u)    MATERIAL AGREEMENTS.  Except as set forth on SCHEDULE
2.1(u) hereto, neither the Company nor any subsidiary is a party to any written
or oral contract, instrument, agreement, commitment, obligation, plan or
arrangement, a copy of which would be required to be filed with the Commission
as an exhibit to a registration statement on Form S-1 or applicable form
(collectively, "Material Agreements") if the Company or any subsidiary were
registering securities under the Securities Act which has not been previously
filed with the Commission.  The Company and each of its subsidiaries has in all
material respects performed all the obligations required to be performed by them
to date under the foregoing agreements, have received no notice of default and,
to the best of the Company's knowledge are not in default under any Material
Agreement now in effect, the result of which could cause a Material Adverse
Effect.  No written or oral contract, instrument, agreement, commitment,
obligation, plan or arrangement of the Company or of any subsidiary limits or
shall limit the payment of dividends on the Series A Preferred Stock (as defined
in Section 3.14 hereof), other preferred stock of the Company, if any, or its
Common Stock.

              (v)    TRANSACTIONS WITH AFFILIATES.  Except as set forth on
SCHEDULE 2.1(v) hereto, there are no loans, leases, agreements, contracts,
royalty agreements, management contracts or arrangements or other continuing
transactions exceeding $100,000 between (a) the Company, any subsidiary or any
of their respective customers or suppliers on the one hand, and (b) on the other
hand, any officer, employee, consultant or director of the Company, or any of
its subsidiaries, or any person owning any capital stock of the Company or any
subsidiary or any member of the immediate family of such officer, employee,
consultant, director or shareholder or any corporation or other entity
controlled by such officer, employee, consultant, director or shareholder, or a
member of the immediate family of such officer, employee, consultant, director
or shareholder.

              (w)    SECURITIES ACT OF 1933.  Based in material part upon the
representations herein of the Purchasers, the Company has complied and will
comply with all applicable federal and state securities laws in connection with
the offer, issuance and sale of the Debentures and

                                       9

<PAGE>

Warrants hereunder and will comply with all applicable federal and state
securities laws in connection with the issuance of the Shares upon conversion
of the Debenture or exercise of the Warrants, as the case may be.  Neither
the Company nor anyone acting on its behalf, directly or indirectly, has or
will sell, offer to sell or solicit offers to by any of the Debentures,
Warrants, Shares or similar securities to, or solicit offers with respect
thereto from, or enter into any preliminary conversations or negotiations
relating thereto with, any person, or has taken or will take any action so as
to bring the issuance and sale of the any of the Shares, Warrants and the
Debentures under the registration provisions of the Securities Act and
applicable state securities laws, and neither the Company nor any of its
affiliates, nor any person acting on its or their behalf, has engaged in any
form of general solicitation or general advertising (within the meaning of
Regulation D under the Securities Act) in connection with the offer or sale
of any of the Debentures, Warrants or the Shares.

              (x)    GOVERNMENTAL APPROVALS.  Except as set forth in the Forms
10-Q, and except for the filing of any notice prior or subsequent to the Closing
that may be required under applicable state and/or federal securities laws
(which if required, shall be filed on a timely basis), including the filing of a
registration statement or statements pursuant to the Registration Rights
Agreement, no authorization, consent, approval, license, exemption of, filing or
registration with any court or governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, is or will be necessary
for, or in connection with, the execution or delivery of the Debentures and
Warrants or for the performance by the Company of its obligations under the
Transaction Documents, the Debentures or the Warrants.

              (y)    EMPLOYEES.  Neither the Company nor any subsidiary has any
collective bargaining arrangements or agreements covering any of its employees,
except as set forth on SCHEDULE 2.1(y) hereto.  Except as set forth on SCHEDULE
2.1(y) hereto, neither the Company nor any subsidiary has any employment
contract, agreement regarding proprietary information, non-competition
agreement, non-solicitation agreement, confidentiality agreement, or any other
similar contract or restrictive covenant, relating to the right of any officer,
employee or consultant to be employed or engaged by the Company or such
subsidiary.  Since March 31, 1999, no officer, consultant or key employee of the
Company or any subsidiary whose termination, either individually or in the
aggregate, could have a Material Adverse Effect, has terminated or, to the
knowledge of the Company, has any present intention of terminating his or her
employment or engagement with the Company or any subsidiary.

              (z)    ABSENCE OF CERTAIN DEVELOPMENTS.  Except as provided in
SCHEDULE 2.1(z) hereto, since March 31, 1999, neither the Company nor any
subsidiary has:

                     (i)    issued any stock, bonds or other corporate
securities or any rights, options or warrants with respect thereto;

                     (ii)   borrowed any amount or incurred or become subject to
any liabilities (absolute or contingent) except current liabilities incurred in
the ordinary course of business which are comparable in nature and amount to the
current liabilities incurred in the ordinary course of business during the
comparable portion of its prior fiscal year, as adjusted to reflect the current
nature and volume of the Company's or such subsidiary's business;

                                       10

<PAGE>

                     (iii)  discharged or satisfied any lien or encumbrance or
paid any obligation or liability (absolute or contingent), other than current
liabilities paid in the ordinary course of business;

                     (iv)   declared or made any payment or distribution of cash
or other property to shareholders with respect to its stock, or purchased or
redeemed, or made any agreements so to purchase or redeem, any shares of its
capital stock;

                     (v)    sold, assigned or transferred any other tangible
assets, or canceled any debts or claims, except in the ordinary course of
business;

                     (vi)   sold, assigned or transferred any patent rights,
trademarks, trade names, copyrights, trade secrets or other intangible assets or
intellectual property rights, or disclosed any proprietary confidential
information to any person except to customers in the ordinary course of business
or to the Purchasers or their representatives;

                     (vii)  suffered any substantial losses or waived any rights
of material value, whether or not in the ordinary course of business, or
suffered the loss of any material amount of prospective business;

                     (viii) made any changes in employee compensation except in
the ordinary course of business and consistent with past practices;

                     (ix)   made capital expenditures or commitments therefor
that aggregate in excess of $100,000;

                     (x)    entered into any other transaction other than in the
ordinary course of business, or entered into any other material transaction,
whether or not in the ordinary course of business;

                     (xi)   suffered any material damage, destruction or
casualty loss, whether or not covered by insurance;

                     (xii)  experienced any material problems with labor or
management in connection with the terms and conditions of their employment;

                     (xiii) effected any two or more events of the foregoing
kind which in the aggregate would be material to the Company or its
subsidiaries; or

                     (xiv)  entered into an agreement, written or otherwise, to
take any of the foregoing actions.

              (aa)   USE OF PROCEEDS.  The proceeds from the sale of the
Debentures and Warrants will be used by the Company for working capital and
general corporate purposes.

              (bb)   PUBLIC UTILITY HOLDING COMPANY ACT AND INVESTMENT COMPANY
ACT STATUS.  The Company is not a "holding company" or a "public utility
company" as such terms are defined in the Public Utility Holding Company Act of
1935, as amended.  The Company is not,

                                       11

<PAGE>

and as a result of and immediately upon the Closing will not be, an
"investment company" or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended.

              (cc)   ERISA.  No liability to the Pension Benefit Guaranty
Corporation has been incurred with respect to any Plan by the Company or any of
its subsidiaries which is or would be materially adverse to the Company and its
subsidiaries.  The execution and delivery of this Agreement and the issue and
sale of the Debentures and Warrants will not involve any transaction which is
subject to the prohibitions of Section 406 of ERISA or in connection with which
a tax could be imposed pursuant to Section 4975 of the Internal Revenue Code of
1986, as amended, provided that, if any of the Purchasers, or any person or
entity that owns a beneficial interest in any of the Purchasers, is an "employee
pension benefit plan" (within the meaning of Section 3(2) of ERISA) with respect
to which the Company is a "party in interest" (within the meaning of Section
3(14) of ERISA), the requirements of Sections 407(d)(5) and 408(e) of ERISA, if
applicable, are met.  As used in this Section 2.1(ac), the term "Plan" shall
mean an "employee pension benefit plan" (as defined in Section 3 of ERISA) which
is or has been established or maintained, or to which contributions are or have
been made, by the Company or any subsidiary or by any trade or business, whether
or not incorporated, which, together with the Company or any subsidiary, is
under common control, as described in Section 414(b) or (c) of the Code.

              (dd)   DILUTIVE EFFECT.  The Company understands and acknowledges
that the number of Shares issuable upon conversion of the Debentures or exercise
of the Warrants will increase in certain circumstances.  The Company further
acknowledges that its obligation to issue Shares upon conversion of the
Debentures or exercise of the Warrants in accordance with this Agreement, the
Debentures and the Warrants is absolute and unconditional regardless of the
dilutive effect that such issuance may have on the ownership interest of other
shareholders of the Company.

              Section 2.2   REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.
Each of the Purchasers hereby makes the following representations and warranties
to the Company with respect solely to itself and not with respect to any other
Purchaser:

              (a)    ORGANIZATION AND STANDING OF THE PURCHASERS.  If the
Purchaser is an entity, such Purchaser is a corporation or partnership duly
incorporated or organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation or organization.

              (b)    AUTHORIZATION AND POWER.  Each Purchaser has the requisite
power and authority to enter into and perform this Agreement and to purchase the
Debentures and Warrants being sold to it hereunder.  The execution, delivery and
performance of this Agreement, the Exchange Agreement and the Registration
Rights Agreement by such Purchaser and the consummation by it of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary corporate or partnership action (if the Purchaser is an entity), and
no further consent or authorization of such Purchaser or its board of directors,
shareholders, or partners, as the case may be, is required.  Each of this
Agreement, the Exchange Agreement and

                                       12

<PAGE>

the Registration Rights Agreement has been duly authorized, executed and
delivered by such Purchaser.

              (c)    NO CONFLICTS.  The execution, delivery and performance of
this Agreement, the Exchange Agreement, the Registration Rights Agreement and
the consummation by each Purchaser of the transactions contemplated hereby and
thereby or relating hereto do not and will not (i) result in a violation of such
Purchaser's charter documents or bylaws (if the Purchaser is an entity) or (ii)
conflict with, or constitute a default (or an event which with notice or lapse
of time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of any agreement, indenture
or instrument to which such Purchaser is a party, or result in a violation of
any law, rule, or regulation, or any order, judgment or decree of any court or
governmental agency applicable to such Purchaser or its properties (except for
such conflicts, defaults and violations as would not, individually or in the
aggregate, have a Material Adverse Effect on such Purchaser).  Such Purchaser is
not required to obtain any consent, authorization or order of, or make any
filing or registration with, any court or governmental agency in order for it to
execute, deliver or perform any of its obligations under this Agreement, the
Exchange Agreement or the Registration Rights Agreement or to purchase the
Debentures and Warrants in accordance with the terms hereof, provided that for
purposes of the representation made in this sentence, such Purchaser is assuming
and relying upon the accuracy of the relevant representations and agreements of
the Company herein.

              (d)    ACQUISITION FOR INVESTMENT.  Such Purchaser is purchasing
the Debentures and Warrants solely for its own account for the purpose of
investment and not with a view to or for sale in connection with distribution.
Such Purchaser does not have a present intention to sell the Debentures or
Warrants, nor a present arrangement (whether or not legally binding) or
intention to effect any distribution of the Debentures or Warrants to or through
any person or entity; PROVIDED,  HOWEVER, that by making the representations
herein and subject to Section 2.2(f) below, such Purchaser does not agree to
hold the Debentures or Warrants for any minimum or other specific term and
reserves the right to dispose of the Debentures or Warrants at any time in
accordance with federal and state securities laws applicable to such
disposition. Such Purchaser acknowledges that it is able to bear the financial
risks associated with an investment in the Debentures and Warrants and that it
has been given full access to such records of the Company and the subsidiaries
and to the officers of the Company and the subsidiaries and received such
information as it has deemed necessary or appropriate to conduct its due
diligence investigation.

              (e)    ACCREDITED PURCHASERS.  Such Purchaser is an "accredited
investor" as defined in Regulation D promulgated under the Securities Act.

              (f)    RULE 144.  Such Purchaser understands that the Shares must
be held indefinitely unless such Shares are registered under the Securities Act
or an exemption from registration is available.  Such Purchaser acknowledges
that such person is familiar with Rule 144 of the rules and regulations of the
Commission, as amended, promulgated pursuant to the Securities Act ("Rule 144"),
and that such person has been advised that Rule 144 permits resales only under
certain circumstances.  Such Purchaser understands that to the extent that Rule
144 is

                                       13

<PAGE>

not available, such person will be unable to sell any Shares without either
registration under the Securities Act or the existence of another exemption
from such registration requirement.

              (g)    CONVERSION RESTRICTIONS.  Notwithstanding anything to the
contrary set forth herein or in the Debentures and Warrants, in no event shall
any Purchaser be entitled to convert the Debentures or exercise Warrants to
purchase, in excess of that aggregate principal amount of the Debentures or that
aggregate number of Warrant Shares, which, upon giving effect to such conversion
or exercise, as applicable, would cause the aggregate number of shares of Common
Stock beneficially owned by such Purchaser and its affiliates to exceed 4.99% of
the outstanding shares of the Common Stock following such conversion.  For
purposes of the foregoing proviso, the aggregate number of shares of Common
Stock beneficially owned by the Purchaser and its affiliates shall include the
number of shares of Common Stock issuable upon conversion of the Debentures and
upon exercise of the Warrants with respect to which the determination of such
proviso is being made, but shall exclude the number of shares of Common Stock
which would be issuable upon (i) conversion of the remaining, unconverted
portion of the Debentures or exercise of the remaining, unexercised portion of
the Warrants owned by such Purchaser and its affiliates, and (ii) exercise or
conversion of the unexercised or unconverted portion of any other securities of
the Company (including, without limitation, any warrants) subject to a
limitation on conversion or exercise analogous to the limitation contained
herein beneficially owned by the holder and its affiliates.  Except as set forth
in the preceding sentence, for purposes of this Section 2.2 (g), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange
Act.

              (h)    GENERAL.  Each Purchaser understands that the Debentures
and Warrants are being offered and sold and the Shares are being issued in
reliance on a transactional exemption from the registration requirements of
federal and state securities laws and the Company is relying upon the truth and
accuracy of the representations, warranties, agreements, acknowledgments and
understandings of such Purchaser set forth herein in order to determine the
applicability of such exemptions and the suitability of such Purchaser to
acquire the Debentures, Warrants and Shares.

                                  ARTICLE III

                                   COVENANTS

       The Company covenants with each of the Purchasers as follows, which
covenants are for the benefit of each of the Purchasers and their permitted
assignees (as defined herein):

              Section 3.1   SECURITIES COMPLIANCE.

              (a)    The Company shall notify the Commission in accordance with
their rules and regulations, of the transactions contemplated by any of the
Transaction Documents, including filing a Form D with respect to the Debentures
and Warrants as required under Regulation D, 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 to the Purchasers or subsequent
holders of the Shares.

                                       14

<PAGE>

              (b)    The Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings of
such Purchasers set forth herein in order to determine the applicability of
Federal and state securities laws exemptions and the suitability of such
Purchasers to acquire the Debentures and Warrants.

              Section 3.2   REGISTRATION AND LISTING.  The Company will use its
best efforts to cause its Common Stock to continue to be registered under
Sections 12(b) or 12(g) of the Exchange Act, will comply in all respects with
its reporting and filing obligations under the Exchange Act, will comply with
all requirements related to any registration statement filed pursuant to this
Agreement or the Registration Rights Agreement, and will not take any action or
file any document (whether or not permitted by the Securities Act or the rules
promulgated thereunder) to terminate or suspend such registration or to
terminate or suspend its reporting and filing obligations under the Exchange Act
or Securities Act, except as permitted herein or in the Registration Rights
Agreement.  The Company will use its best efforts to continue the listing or
trading of its Common Stock on the over-the-counter electronic bulletin board.

              Section 3.3   INSPECTION RIGHTS.  The Company shall permit, during
normal business hours and upon reasonable request and reasonable notice, each
Purchaser or any employees, agents or representatives thereof, so long as the
Debentures remain outstanding and unpaid or unconverted, in whole or in part, or
so long as such Purchaser shall beneficially own any Debentures convertible
into, or Conversion Shares which, in the aggregate, represent more than 2% of
the total combined voting power of all voting securities then outstanding, to
examine and make reasonable copies of and extracts from the records and books of
account of, and visit and inspect the properties, assets, operations and
business of the Company and any subsidiary, and to discuss the affairs, finances
and accounts of the Company and any subsidiary with any of its officers,
consultants, directors, and key employees.

              Section 3.4   COMPLIANCE WITH LAWS.  The Company shall comply, and
cause each subsidiary to comply, with all applicable laws, rules, regulations
and orders, noncompliance with which could have a Material Adverse Effect.

              Section 3.5   KEEPING OF RECORDS AND BOOKS OF ACCOUNT.  The
Company shall keep and cause each subsidiary to keep adequate records and books
of account, in which complete entries will be made in accordance with GAAP
consistently applied, reflecting all financial transactions of the Company and
its subsidiaries, and in which, for each fiscal year, all proper reserves for
depreciation, depletion, obsolescence, amortization, taxes, bad debts and other
purposes in connection with its business shall be made.

              Section 3.6   REPORTING REQUIREMENTS.  The Company shall furnish
the following to each Purchaser so long as the Debentures remain outstanding and
unpaid or unconverted, in whole or in part, or so long as such Purchaser shall
beneficially own any Debentures convertible into, or Conversion Shares which, in
the aggregate, represent more than 2% of the total combined voting power of all
voting securities then outstanding:

              (a)    Quarterly Reports filed with the Commission on Form 10-Q as
soon as available, and in any event within 45 days after the end of each of the
first three fiscal quarters of the Company;

                                       15

<PAGE>

              (b)    Annual Reports filed with the Commission on Form 10-K as
soon as available, and in any event within 90 days after the end of each fiscal
year of the Company;

              (c)    Copies of all notices and information, including without
limitation notices and proxy statements in connection with any meetings, that
are provided to holders of shares of Common Stock, contemporaneously with the
delivery of such notices or information to such holders of Common Stock; and

              (d)    Company Reports filed with the Commission on Forms 8-K as
soon as available, and in any event within ten (10) days after the date of such
filing.

              Section 3.7   AMENDMENTS.  The Company shall not amend or waive
any provision of the Articles of Incorporation or Bylaws of the Company, or
Registration Rights Agreement in any way that would adversely affect the rights
(including the conversion rights and voting rights) of the holders of the
Debentures or, upon exchange pursuant to the Exchange Agreement, the Series A
Preferred Stock.

              Section 3.8   OTHER AGREEMENTS.  The Company shall not enter into
any agreement in which the terms of such agreement would materially restrict or
impair the right or ability to perform of the Company or any subsidiary under
any Transaction Document, the Debentures or the Warrants, as the case may be.

              Section 3.9   DISTRIBUTIONS.  So long as any Debentures remain
outstanding, the Company agrees that it shall not (i) declare or pay any
dividends or make any distributions to any holder(s) of Common Stock or (ii)
purchase or otherwise acquire for value, directly or indirectly, any Common
Stock or other equity security of the Company.

              Section 3.10  REGULATION S.  The Company covenants and agrees that
if the Company fails to register the Conversion Shares within 150 days from the
Closing Date under the terms and conditions of the Registration Rights
Agreement, then for so long as such registration statement is not effective and
as any of the Conversion Shares remain outstanding and continue to be
"restricted securities" within the meaning of Rule 144 under the Securities Act,
the Company shall, in order to permit resales of the Conversion Shares pursuant
to Regulation S under the Securities Act, (a) continue to file all material
required to be filed pursuant to Section 13(a) or 15(d) of the Exchange Act, and
(b) not knowingly engage in directed selling efforts in connection with the
resale of securities by any Purchaser under Regulation S.

              Section 3.11  SUBSEQUENT FINANCING.

              (a)    Except as set forth on SCHEDULE 3.11(a) hereto and with
respect to (i) the issuance of securities (other than for cash) in connection
with a merger and/or acquisition, consolidation, sale or other disposition of
assets, (ii) the exchange of capital stock for assets, (iii) an offering of
securities at no less than the fair market price of such securities or (iv) the
issuance of capital stock or options to purchase shares of its capital stock
pursuant to any employee stock ownership plan currently in existence or pursuant
to or employee stock option plan for the grant of options to purchase less than
five percent (5%) of the outstanding shares of the Company's

                                       16

<PAGE>

Common Stock, the Company covenants and agrees that the Company will not
offer or sell Common Stock or any securities convertible or exchangeable into
Common Stock based on variable rates of conversion (meaning based on a market
price of the Common Stock as of the date of conversion or exchange) which the
Company proposes or intends to consummate with any third parties (the
"Subsequent Financing") on or before the forty-fifth (45th) day following the
effectiveness of the registration statement (the "Registration Statement") to
be filed pursuant to the Registration Rights Agreement without the prior
written consent of the Purchasers.

              (b)    The Company also covenants and agrees that during the one
(1) year period after the effective date of the Registration Statement the
Purchasers shall have a right of first refusal with respect to any Subsequent
Financing.  The Company will promptly notify the Purchasers in writing of the
terms and conditions of the proposed Subsequent Financing.  The Purchasers shall
have the right for ten (10) trading days to consummate the Subsequent Financing,
in whole but not in part, with the Company on the same terms and conditions as
the proposed Subsequent Financing.  If the Purchasers do not consummate the
Subsequent Financing, the Company shall have forty-five (45) days thereafter to
consummate the Subsequent Financing with such third parties, on the same or
substantially the same terms, or on terms more favorable to the Company.

              Section 3.12  RESERVATION OF SHARES  So long as any of the
Debentures remain outstanding, the Company shall take all action necessary to at
all times have authorized, and reserved for the purpose of issuance, no less
than 200% of the aggregate number of shares of Common Stock needed to provide
for the issuance of the Conversion Shares.

              Section 3.13  TRANSFER AGENT INSTRUCTIONS.  The Company shall
issue irrevocable instructions to its transfer agent, and any subsequent
transfer agent, to issue certificates, registered in the name of each Purchaser
or its respective nominee(s), for the Shares in such amounts as specified from
time to time by each Purchaser to the Company upon conversion of the Debentures
or exercise of the Warrants, as the case may be, in the form of Exhibit D
attached hereto (the "Irrevocable Transfer Agent Instructions"). Prior to
registration of the Shares under the Securities Act, all such certificates shall
bear the restrictive legend specified in Section 5.1 of this Agreement.  The
Company warrants that no contrary instructions will be given by the Company to
its transfer agent and that the Shares shall otherwise be freely transferable on
the books and records of the Company as and to the extent provided in this
Agreement and the Registration Rights Agreement.  Nothing in this Section 3.13
shall affect in any way each Purchaser's obligations and agreements set forth in
Section 5.1 to comply with all applicable prospectus delivery requirements, if
any, upon resale of the Shares. If a Purchaser provides the Company with an
opinion of counsel, in a generally acceptable form, to the effect that a public
sale, assignment or transfer of the Shares may be made without registration
under the Securities Act or the Purchaser provides the Company with reasonable
assurances that the Shares can be sold pursuant to Rule 144 without any
restriction as to the number of securities acquired as of a particular date that
can then be immediately sold, the Company shall permit the transfer, and, in the
case of the Shares, promptly instruct its transfer agent to issue one or more
certificates in such name and in such denominations as specified by such
Purchaser and without any restrictive legend.  The Company acknowledges that a
breach by it of its obligations under this Section 3.13 will cause irreparable
harm to the Purchasers by vitiating the intent and purpose of the

                                       17

<PAGE>

transaction conemplated hereby.  Accordingly, the Company acknowledges that
the remedy at law for a breach of its obligations under this Section 3.13
will be inadequate and agrees, in the event of a breach or threatened breach
by the Company of the provisions of this Section 3.13, that the Purchasers
shall be entitled, in addition to all other available remedies, to an order
and/or injunction restraining any breach and requiring immediate issuance and
transfer, without the necessity of showing economic loss and without any bond
or other security being required.

              Section 3.14  AMENDMENT TO COMPANY'S ARTICLES OF INCORPORATION TO
AUTHORIZE PREFERRED STOCK. As promptly as practicable, and in any event no later
than May 24, 2000, the Company shall (i) file with the Secretary of State of the
State of Florida an amendment to the Company's Articles of Incorporation,
authorizing the issuance of up to 20,000,000 shares of preferred stock, par
value $.001 per share issuable in series with such designations, terms,
limitations and relative rights and preferences as may be fixed from time to
time by the Company's Board of Directors ("Amendment to the Articles of
Incorporation") and (ii) shall cause its Board of Directors to authorize the
creation of, and the issuance of up to 600,000 shares of, a series of
convertible preferred stock having such preferences and rights as set forth in
Exhibit E attached hereto (the "Series A Preferred Stock"), and to file a
certificate of designation with the Secretary of State of the State of Florida
creating the Series A Preferred Stock (the "Certificate of Designation" and
together with the Amendment to the Articles of Incorporation, the "Amendments").

              Section 3.15  REGISTRATION OF SHARES.  The Company and each
Purchaser shall enter into the Registration Rights Agreement, in the form of
Exhibit F hereto (the "Registration Rights Agreement").

              Section 3.16  EXCHANGE AGREEMENT.  The Company and the Purchaser
shall enter into the exchange agreement, in the form of Exhibit G hereto (the
"Exchange Agreement"), pursuant to which the Purchasers shall be entitled to
exchange the Debentures for shares of the Series A Preferred Stock upon the
terms and conditions set forth in the Exchange Agreement.  All Debentures must
be exchanged for shares of the Series A Preferred Stock on or before May 30,
2000. The Exchange Agreement shall provide, and the parties hereto hereby
acknowledge and confirm, among other things, the provisions of this Agreement
shall apply to any shares of the Series A Preferred Stock issued in exchange of
the Debentures and that any provisions of this Agreement applicable to
Conversion Shares shall apply to any shares of Common Stock issuable upon
conversion of the Series A Preferred Stock (the "Preferred Conversion Shares").

              Section 3.17  20% CONVERSION CAP.

              (a)    Notwithstanding any other provision herein to the contrary,
the Company shall not be obligated to issue any shares of Common Stock upon
conversion of the Debentures or the exercise of the Warrants if the issuance of
such shares of Common Stock, together with such other shares of Common Stock
required by the securities laws to be aggregated with the transactions
contemplated by this Agreement, would exceed 19.99% of the aggregate number of
shares of Common Stock issued and outstanding at such date (the "Exchange Cap"),
except that such limitation shall not apply in the event that the Company
obtains the approval of its Shareholders pursuant to the rules of The Nasdaq
Stock Market, Inc. for issuances of Common Stock in excess of such amount (the
"Shareholder Approval"); PROVIDED, HOWEVER, that

                                   18
<PAGE>

notwithstanding anything herein to the contrary, the Company, will issue such
number of shares of Common Stock issuable upon conversion of the Debentures
or exercise of the Warrants, as applicable, at the then current Conversion
Price up to the Exchange Cap (after giving effect for any other shares of
Common Stock required by the securities laws to be aggregated with the
transactions contemplated by this Agreement).

              (b)    If, at any time, a holder of Debentures or of Warrants
requests that such Debentures be converted or such Warrants be exercised, as the
case may be, and such conversion or exercise would result in the issuance of
Common Stock which in the aggregate would exceed the Exchange Cap (after giving
effect for any other shares of Common Stock required by the securities laws to
be aggregated with the transactions contemplated by this Agreement), the Company
shall within 30 days of the Conversion Date or Exercise Date, as the case may
be, call a meeting, or solicit the written consent, of its shareholders in order
to seek Shareholder Approval, which shareholders meeting shall take place within
60 days of the Conversion Date or Exercise Date, as applicable. Except as
otherwise provided by Section 6(b)(iii) below, until such Shareholder Approval
or written consent is obtained, the Company shall not be required to convert
Debentures into Common Stock or issue Common Stock issuable upon the exercise of
the Warrants, as the case may be, in an amount greater than the product of (i)
the Exchange Cap amount multiplied by (ii) a fraction, the numerator of which is
the principal amount of the Debentures issued to such holder pursuant to this
Agreement or the aggregate number of shares of Common Stock for which the
holder's Warrant is exercisable (regardless of the limitation provided for in
this Section 3.17), as applicable, and the denominator of which is the aggregate
principal amount of all the Debentures issued pursuant to this Agreement or the
aggregate number of shares of Common Stock for which the Warrants issued
pursuant to this Agreement are exercisable (the "Cap Allocation Amount").  In
the event that the Company shall convert all of such holder's Debentures or
issue Common Stock issuable upon the exercise of all of such holder's Warrants,
as the case may be, into a number of shares of Common Stock which, in the
aggregate, is less than such holder's Cap Allocation Amount, then the difference
between such holder's Cap Alloction Amount and the number of shares of Common
Stock actually issued to such holder shall be allocated to the respective Cap
Allocation Amounts of the remaining holders of the Debentures or Warrants, as
applicable, on a pro rata basis in proportion to the principal amount of the
Debentures then outstanding and held by each such holder or the number of shares
of Common Stock into which the Warrant is exercisable, as the case may be.
Nothing in this provision shall limit a holder's right to request conversion of
the Debentures or the exercise of the Warrants.

              (c)    In the event that the Company fails to obtain Shareholder
Approval in accordance with this Section 3.17, the Company shall, within five
(5) business days after such failure, at the Company's option, either:

                     (i)    (A) prepay the portion of the Debentures for which
the Company is unable to issue Common Stock in accordance with such Holder's
Conversion Notice (as defined in the Debenture), at a price equal to 125% of the
outstanding principal amount of the Debenture as of the date of such conversion,
after taking into account the extent, if any, to which the Company was able to
convert a portion of the Debenture into shares of Common Stock or, if
applicable, (B) redeem the portion of the Warrant for which the Company is
unable to issue

                                      19
<PAGE>

Common Stock in accordance with such Holder's notice of exercise, at a
redemption price equal to 125% of the Warrant Price as of the date of such
exercise, after taking into account the extent, if any, to which the Warrant
was able to be exercised for shares of Common Stock in accordance with
Section 3.17(a) above; or

                     (ii)   regardless of the Exchange Cap, issue shares of the
Common Stock in accordance with such Holder's (A) Conversion Notice or (B)
notice of exercise pursuant to the Warrant.

              (d)    Notwithstanding anything to the contrary contained in
Section 3.17(c) above, the Holder may elect to void its Conversion Notice or
notice of exercise, as the case may be, and retain or have returned, as
applicable, the portion of the Debentures or Warrants that was to be converted
or exercised pursuant to such Holder's notice (provided that a Holder's voiding
its Conversion Notice shall not effect the Company's obligations to make any
payments which have accrued prior to the date of such notice).

                                     ARTICLE IV

                                     CONDITIONS

              Section 4.1   CONDITIONS PRECEDENT TO THE OBLIGATION OF THE
COMPANY TO SELL THE SECURITIES.  The obligation hereunder of the Company to
issue and sell the Debentures and Warrants  to the Purchasers is subject to the
satisfaction or waiver, at or before the Closing, of each of the conditions set
forth below.  These conditions are for the Company's sole benefit and may be
waived by the Company at any time in its sole discretion.

              (a)    ACCURACY OF EACH PURCHASER'S REPRESENTATIONS AND
WARRANTIES.  The representations and warranties of each Purchaser shall be true
and correct in all material respects as of the date when made and as of the
Closing Date, as though made at that time, except for representations and
warranties that are expressly made as of a particular date, which shall be true
and correct in all material respects as of such date.

              (b)    PERFORMANCE BY THE PURCHASERS.  Each Purchaser shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by such Purchaser at or prior to the Closing.

              (c)    CONSENTS OBTAINED.  The Company shall have obtained those
consents of third parties (including, without limitation, governmental or other
regulatory agencies, foreign or domestic) required to be received in connection
with the issuance of the Debentures and the Warrants and the consummation of the
transactions contemplated hereby.

              (d)    NO INJUNCTION.  No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement.

                                 20
<PAGE>

              Section 4.2   CONDITIONS PRECEDENT TO THE OBLIGATION OF THE
PURCHASERS TO PURCHASE THE SECURITIES.  The obligation hereunder of each
Purchaser to acquire and pay for the Debentures and Warrants is subject to the
satisfaction or waiver, at or before the Closing, of each of the conditions set
forth below.  These conditions are for each Purchaser's sole benefit and may be
waived by such Purchaser at any time in its sole discretion.

              (a)    ACCURACY OF THE COMPANY'S REPRESENTATIONS AND WARRANTIES.
Each of the representations and warranties of the Company shall be true and
correct in all material respects as of the date when made and as of the Closing
Date, as though made at that time, (except for representations and warranties
that speak as of a particular date), which shall be true and correct in all
material respects as of such date.

              (b)    PERFORMANCE BY THE COMPANY.  The Company shall have
performed, satisfied and complied in all respects with all covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied
with by the Company at or prior to the Closing.

              (c)    NO SUSPENSION, ETC.  From the date hereof to the Closing
Date, trading in the Company's Common Stock shall not have been suspended by the
Commission (except for any suspension of trading of limited duration agreed to
by the Company, which suspension shall be terminated prior to the Closing Date),
and, at any time prior to the Closing Date, trading in securities generally as
reported by Bloomberg shall not have been suspended or limited, or minimum
prices shall not have been established on securities whose trades are reported
by Bloomberg, or on the New York Stock Exchange, nor shall a banking moratorium
have been declared either by the United States or New York State authorities,
nor shall there have occurred any material outbreak or escalation of hostilities
or other national or international calamity or crisis of such magnitude in its
effect on, or any material adverse change in any financial market which, in each
case, in the judgment of such Purchaser, makes it impracticable or inadvisable
to purchase the Debentures or Warrants.

              (d)    NO INJUNCTION.  No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement.

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

              (f)    OPINION OF COUNSEL, ETC. At the Closing, the Purchasers
shall have received an opinion of counsel to the Company, dated the date of the
Closing, in substantially the form of Exhibit H hereto, and such other
certificates and documents as the Purchasers or their respective counsel shall
reasonably require incident to such Closing.

                                    21
<PAGE>

              (g)    REGISTRATION RIGHTS AGREEMENT.  At the Closing, the Company
shall have executed and delivered the Registration Rights Agreement to each
Purchaser.

              (h)    EXCHANGE AGREEMENT. At the Closing, the Company shall have
executed and delivered the Exchange Agreement to each Purchaser.

              (i)    RESOLUTIONS.  The Board of Directors of the Company shall
have adopted resolutions consistent with Section 2.1(b) above in a form
reasonably acceptable to the Purchasers (the "Resolutions").

              (j)    RESERVATION OF SHARES.  As of the Closing Date, the Company
shall have reserved out of its authorized and unissued Common Stock, solely for
the purpose of effecting the conversion of the Debentures or Series A Preferred
Stock and the exercise of the Warrants, as applicable, a number of shares of
Common Stock equal to at least 200% of the aggregate number of Conversion Shares
issuable upon conversion of the Debentures outstanding on such Closing Date
(after giving effect to the Debentures and assuming all such Debentures were
fully convertible on such date regardless of any limitation on the timing or
amount of such conversions) or issuable upon conversion of the Series A
Preferred Stock on the date of issuance of the Series A Preferred Stock (after
giving effect to the Series A Preferred Stock and assuming all such Series A
Preferred Stock were fully convertible on such date regardless of any limitation
on the timing or amount of such conversions) and 100% of the Warrant Shares
issuable upon exercise of the Warrants on the date of issuance of the Warrants
(after giving effect to the Warrants and assuming all such Warrants were fully
exercisable on such date regardless of any limitation on the timing or amount of
such conversions)

              (k)    TRANSFER AGENT INSTRUCTIONS.  The Irrevocable Transfer
Agent Instructions, in the form of Exhibit D attached hereto, shall have been
delivered to and acknowledged in writing by the Company's transfer agent.

              (l)    SECRETARY'S CERTIFICATE.  The Company shall have delivered
to such Purchaser a secretary's certificate, dated as of the Closing Date, as to
(i) the Resolutions, (ii) the Articles of Incorporation, (iii) the Bylaws, each
as in effect at such Closing, and (iv) the authority and incumbency of the
officers of the Company executing the Transaction Documents and any other
documents required to be executed or delivered in connection therewith.

              (m)    OFFICER'S CERTIFICATE.  The Company shall have delivered to
such Purchaser a certificate of an executive officer of the Company, dated as of
the Closing Date, confirming the accuracy of the Company's representations,
warranties and covenants as of the Closing Date and confirming the compliance by
the Company with the conditions precedent set forth in this Section 4.2 as of
such Closing Date.

                                     22
<PAGE>

                                     ARTICLE V

                                      LEGENDS

              Section 5.1   LEGEND.  Each instrument or certificate representing
the Debentures, Warrants or the Shares, as the case may be, shall be stamped or
otherwise imprinted with a legend substantially in the following form (in
addition to any legend required by applicable state securities or "blue sky"
laws):

       THESE SECURITIES REPRESENTED BY THIS INSTRUMENT OR CERTIFICATE (THE
       "SECURITIES") HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
       AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS AND MAY
       NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER
       THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR THE
       COMPANY SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION
       OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF
       APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.

       The Company agrees to reissue certificates representing the Shares
without the legend set forth above solely in connection with the sale or
transfer of such Shares by the holder.  Such holder thereof shall give written
notice to the Company describing the manner and terms of such transfer and
removal as the Company may reasonably request.  Such proposed transfer will not
be effected until: (a) the Company has notified such holder that either (i) in
the opinion of Company counsel, the registration of the Shares under the
Securities Act is not required in connection with such proposed transfer; or
(ii) a registration statement under the Securities Act covering such proposed
disposition has been filed by the Company with the Commission and is, at the
time of transfer, effective under the Securities Act; and (b) the Company has
notified such holder that either: (i) in the opinion of Company counsel, the
registration or qualification under the securities or "blue sky" laws of any
state is not required in connection with such proposed disposition, or (ii)
compliance with applicable state securities or "blue sky" laws has been
effected.  The Company will use its best efforts to respond to any such notice
from a holder within ten (10) days.  In the case of any proposed transfer under
this Section 5.1, the Company will use reasonable efforts to comply with any
such applicable state securities or "blue sky" laws, but shall in no event be
required, in connection therewith, to qualify to do business in any state where
it is not then qualified or to take any action that would subject it to tax or
to the general service of process in any state where it is not then subject.
The restrictions on transfer contained in Section 5.1 shall be in addition to,
and not by way of limitation of, any other restrictions on transfer contained in
any other section of this Agreement.

                                     23
<PAGE>

                                     ARTICLE VI

                                  INDEMNIFICATION

              Section 6.1   GENERAL INDEMNITY.  The Company agrees to indemnify
and hold harmless the Purchasers and any finder (and their respective directors,
officers, affiliates, agents, successors and assigns) from and against any and
all losses, liabilities, deficiencies, costs, damages and expenses (including,
without limitation, reasonable attorney's fees, charges and disbursements)
incurred by the Purchasers as a result of any inaccuracy in or breach of the
representations, warranties or covenants made by the Company herein.  Each
Purchaser severally but not jointly agrees to indemnify and hold harmless the
Company and its directors, officers, affiliates, agents, successors and assigns
from and against any and all losses, liabilities, deficiencies, costs, damages
and expenses (including, without limitation, reasonable attorneys fees, charges
and disbursements) incurred by the Company as result of any inaccuracy in or
breach of the representations, warranties or covenants made by such Purchaser
herein.

              Section 6.2   INDEMNIFICATION PROCEDURE.  Any party entitled to
indemnification under this Article VI (an "indemnified party") will give written
notice to the indemnifying party of any matters giving rise to a claim for
indemnification; provided, that the failure of any party entitled to
indemnification hereunder to give notice as provided herein shall not relieve
the indemnifying party of its obligations under this Article VI except to the
extent that the indemnifying party is actually prejudiced by such failure to
give notice.  In case any action, proceeding or claim is brought against an
indemnified party in respect of which indemnification is sought hereunder, the
indemnifying party shall be entitled to participate in and, unless in the
reasonable judgment of the indemnified party a conflict of interest between it
and the indemnifying party may exist with respect of such action, proceeding or
claim, to assume the defense thereof with counsel reasonably satisfactory to the
indemnified party.  In the event that the indemnifying party advises an
indemnified party that it will contest such a claim for indemnification
hereunder, or fails, within thirty (30) days of receipt of any indemnification
notice to notify, in writing, such person of its election to defend, settle or
compromise, at its sole cost and expense, any action, proceeding or claim (or
discontinues its defense at any time after it commences such defense), then the
indemnified party may, at its option, defend, settle or otherwise compromise or
pay such action or claim.  In any event, unless and until the indemnifying party
elects in writing to assume and does so assume the defense of any such claim,
proceeding or action, the indemnified party's costs and expenses arising out of
the defense, settlement or compromise of any such action, claim or proceeding
shall be losses subject to indemnification hereunder.  The indemnified party
shall cooperate fully with the indemnifying party in connection with any
negotiation or defense of any such action or claim by the indemnifying party and
shall furnish to the indemnifying party all information reasonably available to
the indemnified party which relates to such action or claim.  The indemnifying
party shall keep the indemnified party fully apprised at all times as to the
status of the defense or any settlement negotiations with respect thereto.  If
the indemnifying party elects to defend any such action or claim, then the
indemnified party shall be entitled to participate in such defense with counsel
of its choice at its sole cost and expense.  The indemnifying party shall not be
liable for any settlement of any action, claim or proceeding effected without
its prior written consent.  Notwithstanding anything in this Article VI to the
contrary, the indemnifying party shall not, without the indemnified party's
prior written consent, settle or compromise any claim or consent

                                    24
<PAGE>

to entry of any judgment in respect thereof which imposes any future
obligation on the indemnified party or which does not include, as an
unconditional term thereof, the giving by the claimant or the plaintiff to
the indemnified party of a release from all liability in respect of such
claim.  The indemnification required by this Article VI shall be made by
periodic payments of the amount thereof during the course of investigation or
defense, as and when bills are received or expense, loss, damage or liability
is incurred, so long as the indemnified party irrevocably agrees to refund
such moneys if it is ultimately determined by a court of competent
jurisdiction that such party was not entitled to indemnification.  The
indemnity agreements contained herein shall be in addition to (a) any cause
of action or similar rights of the indemnified party against the indemnifying
party or others, and (b) any liabilities the indemnifying party may be
subject to pursuant to the law.

                                    ARTICLE VII

                                   MISCELLANEOUS

              Section 7.1   FEES AND EXPENSES.  Except as otherwise set forth in
Schedule 7.1 hereto or elsewhere in this Agreement, the Registration Rights
Agreement, the Debentures, the Warrants or the Exchange Agreement, each party
shall pay the fees and expenses of its advisors, counsel, accountants and other
experts, if any, and all other expenses, incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this Agreement,
PROVIDED that the Company shall pay, at the Closing, all attorneys fees and
expenses (exclusive of disbursements and out-of-pocket expenses) incurred by the
Purchasers up to $50,000 in connection with the preparation, negotiation,
execution and delivery of the Transaction Documents and the transaction
contemplated hereunder.  In addition, the Company shall pay all reasonable fees
and expenses incurred by the Purchasers in connection with any amendments,
modifications or waivers of this Agreement or any of the other Transaction
Documents, or incurred in connection with the enforcement of this Agreement or
any of the other Transaction Documents, including, without limitation, all
reasonable attorneys fees.

              Section 7.2   SPECIFIC ENFORCEMENT, CONSENT TO JURISDICTION.

              (a)    The Company and the Purchasers acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement or the Transaction Documents were not performed in accordance with
their specific terms or were otherwise breached.  It is accordingly agreed that
the parties shall be entitled to an injunction or injunctions to prevent or cure
breaches of the provisions of this Agreement or the Transaction Documents and to
enforce specifically the terms and provisions hereof or thereof, this being in
addition to any other remedy to which any of them may be entitled by law or
equity.

              (b)    Each of the Company and the Purchasers hereby irrevocably
(i)  agrees that any legal suit, action or proceeding arising out of or relating
to this Agreement shall be instituted exclusively in the New York State Supreme
court, County of new York or in the United States District court for the
Southern District of New York, (ii) waives any objection which each of them may
have now or hereafter based upon FORUM NON CONVENIENS or to the venue of any
such suit, action or proceeding, and (iii) consents to the jurisdiction of the
New York State Supreme Court, County of New York and the United States District
court for the Southern

                                    25
<PAGE>

District of New York in any suit, action or proceeding. Each of the Company
and the Purchasers further irrevocably agrees to accept and acknowledge
service of any and all process which may be served in any such suit, action
or proceeding in the New York State Supreme Court, County of New York or in
the United States District Court for the Southern District of New York and
agrees that service of process upon each of them, mailed by certified to such
party at the address in effect for notice to such party, will be deemed in
every respect effective service of process upon such party, in any suit,
action or proceeding. EACH OF THE COMPANY AND THE PURCHASERS HEREBY FURTHER
WAIVES TRIAL BY JURY IN ANY ACTION TO ENFORCE THIS AGREEMENT AND IN
CONNECTION WITH ANY DEFENSE, COUNTERCLAIM OR CROSS-CLAIM ASSERTED IN ANY SUCH
ACTION.  Nothing in this Section 7.2 shall affect or limit any right to serve
process in any other manner permitted by law.

              Section 7.3   ENTIRE AGREEMENT; AMENDMENTS.  This Agreement
contains the entire understanding of the parties with respect to the matters
covered hereby and, except as specifically set forth herein or in the
Transaction Documents, neither the Company nor any of the Purchasers makes any
representations, warranty, covenant or undertaking with respect to such matters.
No provision of this Agreement may be waived or amended other than by a written
instrument signed by the Company and the holders of at least two-thirds (2/3) of
the Debentures then outstanding, and no provision hereof may be waived other
than by an a written instrument signed by the party against whom enforcement of
any such amendment or waiver is sought.  No such amendment shall be effective to
the extent that it applies to less than all of the holders of the Debentures
then outstanding.  No consideration shall be offered or paid to any person to
amend or consent to a waiver or modification of any provision of any of the
Transaction Documents unless the same consideration is also offered to all of
the parties to the Transaction Documents or holders of the Debentures, as the
case may be.

              Section 7.4   NOTICES.  Any notice, demand, request, waiver or
other communication required or permitted to be given hereunder shall be in
writing and shall be effective (a) upon hand delivery, telecopy or facsimile at
the address or number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first (1st)
business day following such delivery (if delivered other than on a business day
during normal business hours where such notice is to be received) or (b) on the
second (2nd) business day following the date of mailing by express courier
service, fully prepaid, addressed to such address, or upon actual receipt of
such mailing, whichever shall first occur.  The addresses for such
communications shall be:

                                   26
<PAGE>

 If to the Company:           Internet Sports Network, Inc.
                              101 Bloor Street West, Suite 200
                              Toronto, Ontario  M5S 2Z7
                              Attn:  David Toews
                              Telephone Number:  416-599-8800
                              Facsimile Number:  416-921-1302

 with copies to:              Akerman, Senterfitt & Eidson, P.A.
                              One S.E. 3rd Avenue, 28th floor
                              Miami, Florida 33131
                              Attn: Kara MacCullough, Esq.
                              Telephone Number:  305-982-5592
                              Facsimile Number:  305-374-5095

 If to any Purchaser:         At the address of such Purchaser set forth on
                              Exhibit A to this Agreement, with copies to
                              Purchaser's counsel as set forth on Exhibit A or
                              as specified in writing by such Purchaser

 with copies to:              Parker Chapin LLP
                              The Chrysler Building
                              405 Lexington Avenue
                              New York, New York 10174
                              Attn:  Christopher S. Auguste, Esq.
                              Telephone Number: (212) 704-6000
                              Fax: (212) 704-6288

Any party hereto may from time to time change its address for notices by giving
at least ten (10) days written notice of such changed address to the other party
hereto.

              Section 7.5   WAIVERS.  No waiver by either party of any default
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provisions, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any  such right accruing to it thereafter.

              Section 7.6   HEADINGS.  The article, section and subsection
headings in this Agreement are for convenience only and shall not constitute a
part of this Agreement for any other purpose and shall not be deemed to limit or
affect any of the provisions hereof.

              Section 7.7   SUCCESSORS AND ASSIGNS.  This Agreement shall be
binding upon and inure to the benefit of the parties and their successors and
assigns.  After the Closing, the assignment by a party to this Agreement of any
rights hereunder shall not affect the obligations of such party under this
Agreement.

                                     27
<PAGE>

              Section 7.8   NO THIRD PARTY BENEFICIARIES.  This Agreement is
intended for the benefit of the parties hereto and their respective permitted
successors and assigns and is not for the benefit of, nor may any provision
hereof be enforced by, any other person.

              Section 7.9   GOVERNING LAW.  This Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York,
without giving effect to the choice of law provisions.

              Section 7.10  SURVIVAL.  The representations and warranties of the
Company and the Purchasers contained in Sections 2.1(o) and (s) should survive
indefinitely and those contained in Article II, with the exception of Sections
2.1(o) and (s), shall survive the execution and delivery hereof and the Closing
until the date three (3) years from the respective Closing Dates, and the
agreements and covenants set forth in Articles I, III, V, VI and VII of this
Agreement shall survive the execution and delivery hereof and the Closing so
long as the Debentures remain outstanding and unpaid or unconverted, in whole or
in part, or until the Purchasers in the aggregate beneficially own (determined
in accordance with Rule 13d-3 under the Exchange Act) Shares less than 2% of the
total combined voting power of all voting securities then outstanding, whichever
is later, provided, that Sections 3.1, 3.2, 3.4, 3.5, 3.7, 3.8, 3.9, 3.10, 3.11
and 3.12 shall not expire until the Registration Statement required by Section 2
of the Registration Rights Agreement is no longer required to be effective under
the terms and conditions of Registration Rights Agreement.

              Section 7.11  COUNTERPARTS.  This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument and shall become effective when counterparts have been signed by
each party and delivered to the other parties hereto, it being understood that
all parties need not sign the same counterpart.  In the event any signature is
delivered by facsimile transmission, the party using such means of delivery
shall cause four additional executed signature pages to be physically delivered
to the other parties within five days of the execution and delivery hereof.

              Section 7.12  PUBLICITY.  The Company agrees that it will not
disclose, and will not include in any public announcement, the name of the
Purchasers, unless and until such disclosure is required by law or applicable
regulation, and then only to the extent of such requirement.

              Section 7.13  SEVERABILITY.  The provisions of this Agreement and
the Transaction Documents are severable and, in the event that any court of
competent jurisdiction shall determine that any one or more of the provisions or
part of the provisions contained in this Agreement or the Transaction Document
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall not affect any
other provision or part of a provision of this Agreement, or the Registration
Rights Agreement shall be reformed and construed as if such invalid or illegal
or unenforceable provision, or part of such provision, had never been contained
herein, so that such provisions would be valid, legal and enforceable to the
maximum extent possible.

              Section 7.14  FURTHER ASSURANCES.  From and after the date of this
Agreement, upon the request of any Purchaser or the Company, each of the Company
and the Purchasers

                                       28
<PAGE>

shall execute and deliver such instrument, documents and other writings as
may be reasonably necessary or desirable to confirm and carry out and to
effectuate fully the intent and purposes of this Agreement and the
Transaction Documents.

                    [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       29
<PAGE>

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

                                         INTERNET SPORTS NETWORK, INC.

                                         BY:  /s/ Andy DeFrancesco
                                              Name:  Andy DeFrancesco
                                              Title: President

                       [SIGNATURES CONTINUED ON THE NEXT PAGE]

                                         30
<PAGE>

                     [SIGNATURES CONTINUED FROM PREVIOUS PAGE]

                                   LIVINGSTON KOSBERG TRUST

                                   By:_/s/ Livingston Kosberg
                                       Name: /s/ Livingston Kosberg
                                       Title:   Trustee

                                   ANEGADA FUND LTD.

                                   By: /s/ Carlo Cull
                                    Name: Carlo Cull
                                         Title:

                                   CUTTYHUNK FUND LTD.

                                   By:  /s/ Geoffrey M. Lewis
                                    Name:  /s/ Geoffrey M. Lewis
                                         Title: Director

                                   TONGA PARTNERS, LP

                                   By: /s/ Carlo Cull
                                    Name: Carlo Cull
                                         Title:

                                   ASPEN INTERNATIONAL, LTD.

                                   By:/s/ Diedre M. McCoy
                                   Name: Diedre M. McCoy
                                         Title: Director

                                        31
<PAGE>

                                                                     EXHIBIT A

                LIST OF PURCHASERS TO SECURITIES PURCHASE AGREEMENT

<TABLE>
<CAPTION>

                                   PRINCIPAL AMOUNT OF
     NAMES AND ADDRESS          DEBENTURES AND AMOUNT OF        DOLLAR AMOUNT
       OR PURCHASERS            WARRANT SHARES PURCHASED        OF INVESTMENT
-------------------------       ------------------------        -------------
<S>                            <C>                              <C>
 Anegada Fund Ltd.             Debentures:   $ 200,000            $ 200,000
 c/o 600 California            Shares issuable upon
 Street, 14th flr              exercise of Warrant:
 San Francisco, California     60,000
 94108
 Tel. No.
 Fax No.
 Attn:

 Aspen International, Ltd.     Debentures:   $ 503,041            $ 503,041
 c/o 600 California            Shares issuable upon
 Street, 14th flr              exercise of Warrant:
 San Francisco, California     150,000
 94108
 Tel. No.
 Fax No.
 Attn:

 Cuttyhunk Fund Ltd.           Debentures:   $ 500,000            $ 500,000
 c/o 600 California            Shares issuable upon
 Street, 14th flr              exercise of Warrant:
 San Francisco, California     150,000
 94108
 Tel. No.
 Fax No.
 Attn:

 J. Livingston Kosberg,        Debentures:   $ 500,000            $ 500,000
 Trustee for The               Shares issuable upon
 Livingston Kosberg Trust      exercise of Warrant:
 c/o 600 California            150,000
 Street, 14th flr
 San Francisco, California
 94108
 Tel. No.
 Fax No.
 Attn:

 Tonga Partners, LP            Debentures:   $ 253,041            $ 253,041
 c/o 600 California            Shares issuable upon
 Street, 14th flr              exercise of Warrant:
 San Francisco, California     75,000
 94108
 Tel. No.
 Fax No.
 Attn:

</TABLE>

                                      32<PAGE>

                                                                   EXHIBIT 10.13

                           REGISTRATION RIGHTS AGREEMENT

              This Registration Rights Agreement (this "AGREEMENT") is made and
entered into as of May 10, 2000, among Internet Sports Network, Inc., a Delaware
corporation (the "COMPANY"), and each of the Purchasers listed on Schedule 1
attached hereto.  Each of the Purchasers listed on Schedule 1 attached hereto is
referred to herein as a "PURCHASER" and are collectively referred to herein as
the "PURCHASERS."

              This Agreement is being entered into pursuant to the Securities
Purchase Agreement, dated as of the date hereof, by and among the Company and
the Purchasers (the "PURCHASE AGREEMENT").

              The Company and the Purchasers hereby agree as follows:

       1.     DEFINITIONS.

              Capitalized terms used and not otherwise defined herein shall have
the meanings given such terms in the Purchase Agreement.  As used in this
Agreement, the following terms shall have the following meanings:

              "ADVICE" shall have the meaning set forth in Section 3(n).

              "AFFILIATE" means, with respect to any Person, any other Person
that directly or indirectly controls or is controlled by or under common control
with such Person.  For the purposes of this definition, "CONTROL," when used
with respect to any Person, means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of such
Person, whether through the ownership of voting securities, by contract or
otherwise; and the terms of "AFFILIATED," "CONTROLLING" and "CONTROLLED" have
meanings correlative to the foregoing.

              "BLACKOUT PERIOD" shall have the meaning set forth in
Section 3(o).

              "BOARD" shall have the meaning set forth in Section 3(o).

              "BUSINESS DAY" means any day except Saturday, Sunday and any day
which shall be a legal holiday or a day on which banking institutions in the
state of California generally are authorized or required by law or other
government actions to close.

              "COMMISSION" means the Securities and Exchange Commission.

              "COMMON STOCK" means the Company's Common Stock, par value $.001
per share.

              "DEBENTURE" means the Company's 5% Redeemable Convertible
Debentures, in the aggregate principal amount of up to $1,956,082 issued to the
Purchasers pursuant to the Purchase Agreement.

<PAGE>

              "EFFECTIVENESS DATE" means with respect to the Registration
Statement the earlier of the 90th day following the Filing Date and the date
which is within five (5) days of the date on which the Commission informs the
Company that the Commission (i) will not review the Registration Statement or
(ii) that the Company may request the acceleration of the effectiveness of the
Registration Statement.

              "EFFECTIVENESS PERIOD" shall have the meaning set forth in
Section 2(a).

              "EVENT" shall have the meaning set forth in Section 7(e).

              "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.

              "EXCHANGE AGREEMENT" means the Exchange Agreement of even date
herewith among the Company and the Purchasers pursuant to which the Company will
issue shares of Preferred Stock to the Purchasers in exchange of the Debentures.

              "FILING DATE" means the date the Registration Statement is filed
which date shall be June 30, 2000.

              "HOLDER" or "HOLDERS" means the holder or holders, as the case may
be, from time to time of Registrable Securities including, including without
limitation, the Purchasers and their assigns.

              "INDEMNIFIED PARTY" shall have the meaning set forth in
Section 5(c).

              "INDEMNIFYING PARTY" shall have the meaning set forth in
Section 5(c).

              "LOSSES" shall have the meaning set forth in Section 5(a).

              "OTC BULLETIN BOARD" shall mean the over-the-counter electronic
bulletin board.

              "PERSON" means an individual or a corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or political subdivision
thereof) or other entity of any kind.

              "PREFERRED STOCK" means the Series A convertible preferred stock,
par value $.001 per share, of the Company.

              "PROCEEDING" means an action, claim, suit, investigation or
proceeding (including, without limitation, an investigation or partial
proceeding, such as a deposition), whether commenced or threatened.

              "PROSPECTUS" means the prospectus included in the Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by the Registration Statement, and all other amendments and
supplements to the

                                       2

<PAGE>

Prospectus, including post-effective amendments, and all material
incorporated by reference in such Prospectus.

              "REGISTRABLE SECURITIES" means (i) the shares of Common Stock
issuable upon conversion of the Preferred Stock; PROVIDED, HOWEVER, that if the
Preferred Stock are not issued to the Purchasers in exchange for the Debentures
pursuant to the Exchange Agreement on or before May 30, 2000, the shares of
Common Stock issuable upon conversion of the Debentures (the "CONVERSION
SHARES") and upon exercise of the Warrants (the "WARRANT SHARES"), and upon any
stock split, stock dividend, recapitalization or similar event with respect to
such Conversion Shares and Warrant Shares, (ii) the shares of Common Stock
issuable upon exercise of warrants issued to the placement advisor in connection
with the sale of the Debentures, (iii) any other interest or other distribution
with respect to, conversion or exchange of, or in replacement of, Registrable
Securities; PROVIDED, HOWEVER, that Registrable Securities shall include (but
not be limited to) a number of shares of Common Stock equal to no less than 200%
of the maximum number of shares of Common Stock which would be issuable upon
conversion of the Preferred Stock or the Debentures if the Preferred Stock are
not issued by May 30, 2000, assuming such conversion and exercise occurred on
the Closing Date or the Filing Date, whichever date would result in the greater
number of Registrable Securities.  Notwithstanding anything herein contained to
the contrary, such registered shares of Common Stock shall be allocated among
the Holders pro rata based on the total number of Registrable Securities issued
or issuable as of each date that a Registration Statement, as amended, relating
to the resale of the Registrable Securities is declared effective by the
Commission.  Notwithstanding anything contained herein to the contrary, if the
actual number of shares of Common Stock issuable upon conversion of the
Preferred Stock or the Debentures if the Preferred Stock are not issued by May
30, 2000, exceeds 200% of the number of shares of Common Stock issuable upon
conversion of the Preferred Stock or the Debentures, as applicable, based upon a
computation as at the Closing Date or the Filing Date, the term "Registrable
Securities" shall be deemed to include such additional shares of Common Stock.

              "REGISTRATION STATEMENT" means the registration statement and any
additional registration statements contemplated by Section 2, including (in each
case) the Prospectus, amendments and supplements to such registration statement
or Prospectus, including pre- and post-effective amendments, all exhibits
thereto, and all material incorporated by reference in such registration
statement.

              "RULE 144" means Rule 144 promulgated by the Commission pursuant
to the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

              "RULE 158" means Rule 158 promulgated by the Commission pursuant
to the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

              "RULE 415" means Rule 415 promulgated by the Commission pursuant
to the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.

                                       3

<PAGE>

              "SECURITIES ACT" means the Securities Act of 1933, as amended.

              "SPECIAL COUNSEL" means any special counsel to the Holders, for
which the Holders will be reimbursed by the Company pursuant to Section 4.

              "WARRANTS" means the Company's warrants, exercisable to purchase
up to an aggregate of 585,000 shares of the Common Stock, granted to the
Purchasers pursuant to the Purchase Agreement.

       2.     REGISTRATION.

              (a)    REQUIRED REGISTRATION.  On or prior to the Filing Date the
Company shall prepare and file with the Commission a Registration Statement
covering for resale all Registrable Securities for an offering to be made on a
continuous basis pursuant to Rule 415.  The Registration Statement shall be on
Form S-1 (except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-1, in which case such registration shall be on
another appropriate form in accordance herewith). The Company shall (i) not
permit any securities other than the Registrable Securities and those securities
previously granted piggy-back registration rights as identified in Schedule 2(a)
hereof, to be included in the Registration Statement and (ii) use its best
efforts to cause the Registration Statement to be declared effective under the
Securities Act as promptly as possible after the filing thereof, but in any
event prior to the Effectiveness Date, and to keep such Registration Statement
continuously effective under the Securities Act until such date as is the
earlier of (x) the date when all Registrable Securities covered by such
Registration Statement have been sold or (y) the date on which the Registrable
Securities may be sold without any restriction pursuant to Rule 144(k) as
determined by the counsel to the Company pursuant to a written opinion letter,
addressed to the Company's transfer agent to such effect (the "Effectiveness
Period").  If an additional Registration Statement is required to be filed
because the actual number of shares of Common Stock into which the Preferred
Stock or Debentures, as applicable, are convertible and the Warrants are
exercisable exceeds the number of shares of Common Stock initially registered in
respect of the Conversion Shares and Warrant Shares based upon the computation
on the Closing Date, the Company shall have twenty (20) Business Days to file
such additional Registration Statement, and the Company shall use its best
efforts to cause such additional Registration Statement to be declared effective
by the Commission as soon as possible, but in no event later than forty (40)
days after filing.

              (b)    SHELF REGISTRATION.  As soon as possible but no later than
thirty (30) days after becoming eligible to file a registration statement for a
secondary or resale offering of the Registrable Securities on Form S-3, the
Company shall prepare and file with the Commission a post-effective amendment to
Form S-1 (or such other applicable form filed in accordance with Section 2(a)
above) on Form S-3 to continue the registration of all Registrable Securities
pursuant to a "shelf" Registration Statement on Form S-3 covering all
Registrable Securities for an offering to be made on a continuous basis pursuant
to Rule 415.  Other than as provided in Section 3(o) below, notwithstanding
anything to the contrary contained herein, at no time during the Effectiveness
Period shall any of the Registrable Securities cease being registered.

                                       4

<PAGE>

       3.     REGISTRATION PROCEDURES.

              In connection with the Company's registration obligations
hereunder, the Company shall:

              (a)    Prepare and file with the Commission on or prior to the
Filing Date, a Registration Statement on Form S-1 (or if the Company is not then
eligible to register for resale the Registrable Securities on Form S-1 such
registration shall be on another appropriate form in accordance herewith) in
accordance with the method or methods of distribution thereof as specified by
the Holders (except if otherwise directed by the Holders), and cause the
Registration Statement to become effective and remain effective as provided
herein; PROVIDED, HOWEVER, that not less than five (5) Business Days prior to
the filing of the Registration Statement or any related Prospectus or any
amendment or supplement thereto (including any document that would be
incorporated therein by reference), the Company shall (i) furnish to the Holders
and any Special Counsel, copies of all such documents proposed to be filed,
which documents (other than those incorporated by reference) will be subject to
the review of such Holders and such Special Counsel, and (ii) at the request of
any Holder cause its officers and directors, counsel and independent certified
public accountants to respond to such inquiries as shall be necessary, in the
reasonable opinion of counsel to such Holders, to conduct a reasonable
investigation within the meaning of the Securities Act.  The Company shall not
file the Registration Statement or any such Prospectus or any amendments or
supplements thereto to which the Holders of a majority of the Registrable
Securities or any Special Counsel shall reasonably object in writing within
three (3) Business Days of their receipt thereof.

              (b)    (i) Prepare and file with the Commission such amendments,
including post-effective amendments, to the Registration Statement as may be
necessary to keep the Registration Statement continuously effective as to the
applicable Registrable Securities for the Effectiveness Period and prepare and
file with the Commission such additional Registration Statements in order to
register for resale under the Securities Act all of the Registrable Securities;
(ii) cause the related Prospectus to be amended or supplemented by any required
Prospectus supplement, and as so supplemented or amended to be filed pursuant to
Rule 424 (or any similar provisions then in force) promulgated under the
Securities Act; (iii) respond as promptly as possible to any comments received
from the Commission with respect to the Registration Statement or any amendment
thereto and as promptly as possible provide the Holders true and complete copies
of all correspondence from and to the Commission relating to the Registration
Statement; and (iv) comply in all material respects with the provisions of the
Securities Act and the Exchange Act with respect to the disposition of all
Registrable Securities covered by the Registration Statement during the
applicable period in accordance with the intended methods of disposition by the
Holders thereof set forth in the Registration Statement as so amended or in such
Prospectus as so supplemented.

              (c)    Notify the Holders of Registrable Securities to be sold and
any Special Counsel as promptly as possible (and, in the case of (i)(A) below,
not less than five (5) Business Days prior to such filing) and (if requested by
any such Person) confirm such notice in writing no later than one (1) Business
Day following the day (i)(A) when a Prospectus or any Prospectus supplement or
post-effective amendment to the Registration Statement is proposed to be filed;
(B) when the Commission notifies the Company whether there will be a "review" of
such

                                       5

<PAGE>

Registration Statement and whenever the Commission comments in writing on
such Registration Statement and (C) with respect to the Registration Statement
or any post-effective amendment, when the same has become effective; (ii) of any
request by the Commission or any other Federal or state governmental authority
for amendments or supplements to the Registration Statement or Prospectus or for
additional information; (iii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement covering any or
all of the Registrable Securities or the initiation of any Proceedings for that
purpose; (iv) if at any time any of the representations and warranties of the
Company contained in any agreement contemplated hereby ceases to be true and
correct in all material respects; (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; and (vi) of the occurrence of any event that makes any statement made
in the Registration Statement or Prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect or
that requires any revisions to the Registration Statement, Prospectus or other
documents so that, in the case of the Registration Statement or the Prospectus,
as the case may be, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.

              The Company shall promptly furnish to Special Counsel, without
charge, (i) any correspondence from the Commission or the Commission's staff to
the Company or its representatives relating to any Registration Statement and
(ii) promptly after the same is prepared and filed with the Commission, a copy
of any written response to the correspondence received from the Commission.

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

              (e)    If requested by the Holders of a majority in interest of
the Registrable Securities, (i) promptly incorporate in a Prospectus supplement
or post-effective amendment to the Registration Statement such information as
the Company reasonably agrees should be included therein and (ii) make all
required filings of such Prospectus supplement or such post-effective amendment
as soon as practicable after the Company has received notification of the
matters to be incorporated in such Prospectus supplement or post-effective
amendment.

              (f)    Furnish to each Holder and any Special Counsel, without
charge, at least one conformed copy of each Registration Statement and each
amendment thereto, including financial statements and schedules, all documents
incorporated or deemed to be incorporated therein by reference, and all exhibits
to the extent requested by such Person (including those previously furnished or
incorporated by reference) promptly after the filing of such documents with the
Commission.

              (g)    Promptly deliver to each Holder and any Special Counsel,
without charge, as many copies of the Registration Statement, Prospectus or
Prospectuses (including each form

                                       6

<PAGE>

of prospectus) and each amendment or supplement thereto as such Persons may
reasonably request; and the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable
Securities covered by such Prospectus and any amendment or supplement thereto.

              (h)    Prior to any public offering of Registrable Securities, use
its best efforts to register or qualify or cooperate with the selling Holders
and any Special Counsel in connection with the registration or qualification (or
exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions within the United States as any Holder requests in writing, to
keep each such registration or qualification (or exemption therefrom) effective
during the Effectiveness Period and to do any and all other acts or things
necessary or advisable to enable the disposition in such jurisdictions of the
Registrable Securities covered by a Registration Statement; PROVIDED, HOWEVER,
that the Company shall not be required to qualify generally to do business in
any jurisdiction where it is not then so qualified or to take any action that
would subject it to general service of process in any such jurisdiction where it
is not then so subject or subject the Company to any material tax in any such
jurisdiction where it is not then so subject.

              (i)    Cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold pursuant to a Registration Statement, which certificates shall be free
of all restrictive legends, and to enable such Registrable Securities to be in
such denominations and registered in such names as any Holder may request at
least two (2) Business Days prior to any sale of Registrable Securities.

              (j)    Upon the occurrence of any event contemplated by Section
3(c)(vi), as promptly as possible, prepare a supplement or amendment, including
a post-effective amendment, to the Registration Statement or a supplement to the
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference, and file any other required document so that, as
thereafter delivered, neither the Registration Statement nor such Prospectus
will contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading.

              (k)    Use its best efforts to cause all Registrable Securities
relating to such Registration Statement to be listed on the OTC Bulletin Board
and any other securities exchange, quotation system, market or over-the-counter
bulletin board, if any, on which similar securities issued by the Company are
then listed as and when required pursuant to the Purchase Agreement.

              (l)    Comply in all material respects with all applicable rules
and regulations of the Commission and make generally available to its security
holders earning statements satisfying the provisions of Section 11(a) of the
Securities Act and Rule 158 not later than 45 days after the end of any 12-month
period (or 90 days after the end of any 12-month period if such period is a
fiscal year) commencing on the first day of the first fiscal quarter of the
Company after the effective date of the Registration Statement, which statement
shall conform to the requirements of Rule 158.

                                       7

<PAGE>

              (m)    Require each selling Holder to furnish to the Company
information regarding such Holder and the distribution of such Registrable
Securities as is required by law to be disclosed in the Registration Statement,
and the Company may exclude from such registration the Registrable Securities of
any such Holder who fails to furnish such information within a reasonable time
prior to the filing of each Registration Statement, supplemented Prospectus
and/or amended Registration Statement.

              (n)    If the Registration Statement refers to any Holder by name
or otherwise as the holder of any securities of the Company, then such Holder
shall have the right to require (if such reference to such Holder by name or
otherwise is not required by the Securities Act or any similar federal statute
then in force) the deletion of the reference to such Holder in any amendment or
supplement to the Registration Statement filed or prepared subsequent to the
time that such reference ceases to be required.

              Each Holder covenants and agrees that (i) it will not sell any
Registrable Securities under the Registration Statement until it has received
copies of the Prospectus as then amended or supplemented as contemplated in
Section 3(g) and notice from the Company that such Registration Statement and
any post-effective amendments thereto have become effective as contemplated by
Section 3(c) and (ii) it and its officers, directors or Affiliates, if any, will
comply with the prospectus delivery requirements of the Securities Act as
applicable to them in connection with sales of Registrable Securities pursuant
to the Registration Statement.

              Each Holder agrees by its acquisition of such Registrable
Securities that, upon receipt of a notice from the Company of the occurrence of
any event of the kind described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv),
3(c)(v) or 3(c)(vi), such Holder will forthwith discontinue disposition of such
Registrable Securities under the Registration Statement until such Holder's
receipt of the copies of the supplemented Prospectus and/or amended Registration
Statement contemplated by Section 3(j), or until it is advised in writing (the
"ADVICE") by the Company that the use of the applicable Prospectus may be
resumed, and, in either case, has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus or Registration Statement.

              (o)    Notwithstanding anything set forth in this Agreement,
including in Sections 2 and 3 above, the Company may postpone the filing period,
suspend the effectiveness of any registration, suspend the use of any Prospectus
and shall not be required to amend or supplement the Registration Statement, any
related Prospectus or any document incorporated therein by reference in the
event that if (i) an event or circumstance occurs and is continuing as a result
of which the Registration Statement, any related Prospectus or any document
incorporated therein by reference as then amended or supplemented would, in the
Company's good-faith judgment, contain an untrue statement or a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading and
(ii)(A) there is material non-public information regarding the Company which the
Company's Board of Directors (the "BOARD") reasonably determines not to be in
the Company's best interest to disclose and which the Company is not otherwise
required to disclose, or (B) there is a significant business opportunity
(including, but not limited to, the acquisition or disposition of assets (other
than in the ordinary course of business) or any merger, consolidation, tender
offer or other similar transaction) available to the Company which the

                                       8

<PAGE>

Board reasonably determines not to be in the Company's best interest to
disclose and which the Company would be required to disclose under the
Registration Statement, then the Company may postpone or suspend filing or
effectiveness of a registration statement for a period not to exceed  30
consecutive days, provided that the Company may not postpone or suspend its
obligation under this Section 3(n) for more than 50 days in the aggregate
during any 12 month period (each, a "BLACKOUT PERIOD"); PROVIDED, HOWEVER,
that no such postponement or suspension shall be permitted for consecutive 30
day periods, arising out of the same set of facts, circumstances or
transactions; FURTHER PROVIDED, HOWEVER, that the Holders of Conversion
Shares and/or Preferred Stock or Debentures, as the case may be, convertible
into Conversion Shares, representing, in the aggregate, at least seventy-five
percent (75%) of the total number of Conversion Shares issuable pursuant to
the Purchase Agreement may consent, in writing, to extend the duration of any
Black-Out Period, which consent may not be unreasonably withheld.  In the
event of the occurrence of any Black-Out Period during the Effectiveness
Period, the Company will promptly notify the Holders of Registrable
Securities thereof in writing.

       4.     REGISTRATION EXPENSES

              All fees and expenses incident to the performance of or compliance
with this Agreement by the Company shall be borne by the Company whether or not
the Registration Statement is filed or becomes effective and whether or not any
Registrable Securities are sold pursuant to the Registration Statement other
than any underwriting discounts and commissions and transfer taxes, if any,
relating to the sale or disposition of any Registrable Securities pursuant to
any Registration Statement, which shall be for the account of the Holder of such
Registrable Securities.  Expenses referred to in the foregoing sentence shall
include, without limitation, (i) all registration and filing fees (including,
without limitation, fees and expenses (A) with respect to filings required to be
made with the OTC Bulletin Board and each other securities exchange or market on
which Registrable Securities are required hereunder to be listed, (B) with
respect to filings required to be made with the Commission, and (C) in
compliance with state securities or Blue Sky laws (including, without
limitation, fees and disbursements of counsel for the Holders in connection with
Blue Sky qualifications of the Registrable Securities and determination of the
eligibility of the Registrable Securities for investment under the laws of such
jurisdictions as the Holders of a majority of Registrable Securities may
designate)), (ii) printing expenses (including, without limitation, expenses of
printing certificates for Registrable Securities and of printing prospectuses if
the printing of prospectuses is requested by the holders of a majority of the
Registrable Securities included in the Registration Statement), (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for the
Company and Special Counsel for the Holders, in the case of the Special Counsel,
to a maximum amount of $20,000, (v) Securities Act liability insurance, if the
Company so desires such insurance, and (vi) fees and expenses of all other
Persons retained by the Comany in connection with the consummation of the
transactions contemplated by this Agreement, including, without limitation, the
Company's independent public accountants (including the expenses of any comfort
letters or costs associated with the delivery by independent public accountants
of a comfort letter or comfort letters).  In addition, the Company shall be
responsible for all of its internal expenses incurred in connection with the
consummation of the transactions contemplated by this Agreement (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit, the
fees and expenses incurred in connection with the listing of the Registrable
Securities on any securities exchange as required hereunder.

                                       9

<PAGE>

       5.     INDEMNIFICATION

              (a)    INDEMNIFICATION BY THE COMPANY.  The Company shall,
notwithstanding any termination of this Agreement, indemnify and hold harmless
each Holder, the officers, directors, agents, brokers (including brokers who
offer and sell Registrable Securities as principal as a result of a pledge or
any failure to perform under a margin call of Common Stock), investment advisors
and employees of each of them, each Person who controls any such Holder (within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act) and the officers, directors, agents and employees of each such controlling
Person, to the fullest extent permitted by applicable law, from and against any
and all losses, claims, damages, liabilities, costs (including, without
limitation, costs of preparation and attorneys' fees) and expenses
(collectively, "LOSSES"), as incurred, arising out of or relating to any untrue
or alleged untrue statement of a material fact contained in the Registration
Statement, any Prospectus or any form of prospectus or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of or
relating to any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein (in the case of any
Prospectus or form of prospectus or supplement thereto, in the light of the
circumstances under which they were made) not misleading, except to the extent,
but only to the extent, that such untrue statements or omissions are based
solely upon information regarding such Holder furnished in writing to the
Company by such Holder expressly for use therein, which information was
reasonably relied on by the Company for use therein or to the extent that such
information relates to such Holder or such Holder's proposed method of
distribution of Registrable Securities and was reviewed and expressly approved
in writing by such Holder expressly for use in the Registration Statement, such
Prospectus or such form of Prospectus or in any amendment or supplement thereto;
provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission contained in any preliminary
prospectus if such Holder failed to send or deliver a copy of the Prospectus, as
amended and or supplemented, to the person asserting such losses, claims,
damages or liabilities on or prior to delivery of written confirmation of any
sales of securities covered thereby to such Person in any case where such
delivery is required by the Securities Act and such Prospectus, as amended or
supplemented, would have corrected such untrue statement or omission. The
Company shall notify the Holders promptly of the institution, threat or
assertion of any Proceeding of which the Company is aware in connection wit the
transactions contemplated by this Agreement.  Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of an
Indemnified Party (as defined in Section 5(c) herein) and shall survive the
transfer of the Registrable Securities by the Holders.

              (b)    INDEMNIFICATION BY HOLDERS.  Each Holder shall, severally
and not jointly, indemnify and hold harmless the Company, the directors,
officers, agents and employees, each Person who controls the Company (within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act),
and the directors, officers, agents or employees of such controlling Persons, to
the fullest extent permitted by applicable law, from and against all Losses, as
incurred, arising solely out of or based solely upon any untrue statement of a
material fact contained in the Registration Statement, any Prospectus, or any
form of prospectus, or arising solely out of or based solely upon any omission
of a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus or form of prospectus or
supplement thereto, in the light of the circumstances under which they were
made)

                                       10

<PAGE>

not misleading, to the extent, but only to the extent, that such untrue
statement or omission is contained in or omitted from any information so
furnished in writing by such Holder to the Company specifically for inclusion
in the Registration Statement or such Prospectus and that such information
was reasonably relied upon by the Company for use in the Registration
Statement, such Prospectus or such form of prospectus or to the extent that
such information relates to such Holder or such Holder's proposed method of
distribution of Registrable Securities and was reviewed and expressly
approved in writing by such Holder expressly for use in the Registration
Statement, such Prospectus or such form of Prospectus Supplement.
Notwithstanding anything to the contrary contained herein, the Holder shall
be liable under this Section 5(b) for only that amount as does not exceed the
net proceeds to such Holder as a result of the sale of Registrable Securities
pursuant to such Registration Statement.

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

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

              All fees and expenses of the Indemnified Party (including
reasonable fees and expenses to the extent incurred in connection with
investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section) shall be paid to the Indemnified Party,

                                       11

<PAGE>

as incurred, within ten (10) Business Days of written notice thereof to the
Indemnifying Party (regardless of whether it is ultimately determined that an
Indemnified Party is not entitled to indemnification hereunder; provided, that
the Indemnifying Party may require such Indemnified Party to undertake to
reimburse all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to indemnification
hereunder).

              (d)    CONTRIBUTION.  If a claim for indemnification under
Section 5(a) or 5(b) is unavailable to an Indemnified Party because of a
failure or refusal of a governmental authority to enforce such
indemnification in accordance with its terms (by reason of public policy or
otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions
that resulted in such Losses as well as any other relevant equitable
considerations.  The relative fault of such Indemnifying Party and
Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission of a material
fact, has been taken or made by, or relates to information supplied by, such
Indemnifying, Party or Indemnified Party, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission.  The amount paid or payable by a party as a
result of any Losses shall be deemed to include, subject to the limitations
set forth in Section 5(c), any reasonable attorneys' or other reasonable fees
or expenses incurred by such party in connection with any Proceeding to the
extent such party would have been indemnified for such fees or expenses if
the indemnification provided for in this Section was available to such party
in accordance with its terms.  Notwithstanding anything to the contrary
contained herein, the Holder shall be liable or required to contribute under
this Section 5(c) for only that amount as does not exceed the net proceeds to
such Holder as a result of the sale of Registrable Securities pursuant to
such Registration Statement.

              The parties hereto agree that it would not be just and equitable
if contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
No Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.

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

       6.     RULE 144.

              As long as any Holder owns Debentures, Preferred Stock, Warrants,
Conversion Shares or Warrant Shares, the Company covenants to timely file (or
obtain extensions in respect thereof and file within the applicable grace
period) all reports required to be filed by the Company after the date hereof
pursuant to Section 13(a) or 15(d) of the Exchange Act and to promptly furnish
the Holders with true and complete copies of all such filings.  As long as any
Holder owns Debentures, Preferred Stock, Warrants, Conversion Shares or Warrant
Shares, if the

                                       12
<PAGE>

Company is not required to file reports pursuant to Section 13(a) or 15(d) of
the Exchange Act, it will prepare and furnish to the Holders and make
publicly available in accordance with Rule 144(c) promulgated under the
Securities Act annual and quarterly financial statements, together with a
discussion and analysis of such financial statements in form and substance
substantially similar to those that would otherwise be required to be
included in reports required by Section 13(a) or 15(d) of the Exchange Act,
as well as any other information required thereby, in the time period that
such filings would have been required to have been made under the Exchange
Act.  The Company further covenants that it will take such further action as
any Holder may reasonably request, all to the extent required from time to
time to enable such Person to sell the Conversion Shares and Warrant Shares
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 promulgated under the Securities Act,
including providing any legal opinions of counsel to the Company referred to
in the Purchase Agreement.  Upon the request of any Holder, the Company shall
deliver to such Holder a written certification of a duly authorized officer
as to whether it has complied with such requirements.

       7.     MISCELLANEOUS.

              (a)    REMEDIES.  In the event of a breach by the Company or by a
Holder, of any of their obligations under this Agreement, each Holder or the
Company, as the case may be, in addition to being entitled to exercise all
rights granted by law and under this Agreement, including recovery of damages,
will be entitled to specific performance of its rights under this Agreement.
The Company and each Holder agree that monetary damages would not provide
adequate compensation for any losses incurred by reason of a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate.

              (b)    NO INCONSISTENT AGREEMENTS.  Neither the Company nor any of
its subsidiaries has, as of the date hereof entered into and currently in
effect, nor shall the Company or any of its subsidiaries, on or after the date
of this Agreement, enter into any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof.  Other than as provided in
Schedule 2(a), neither the Company nor any of its subsidiaries has previously
entered into any agreement currently in effect granting any registration rights
with respect to any of its securities to any Person.  Without limiting the
generality of the foregoing, without the written consent of the Holders of a
majority of the then outstanding Registrable Securities, except as set forth in
SCHEDULE 7(b) hereto the Company shall not grant to any Person the right to
request the Company to register any securities of the Company under the
Securities Act unless the rights so granted are subject in all respects to the
prior rights in full of the Holders set forth herein, and are not otherwise in
conflict with the provisions of this Agreement.

              (c)    NO PIGGYBACK ON REGISTRATIONS. Except as set forth in
SCHEDULE 2(a) hereto, neither the Company nor any of its security holders (other
than the Holders in such capacity pursuant hereto) may include securities of the
Company in the Registration Statement, and the Company shall not after the date
hereof enter into any agreement providing such right to any of its security
holders, unless the right so granted is subject in all respects to the prior
rights

                                       13
<PAGE>

in full of the Holders set forth herein, and is not otherwise in conflict
with the provisions of this Agreement.

              (d)    PIGGY-BACK REGISTRATIONS.  If at any time when there is not
an effective Registration Statement covering the Conversion Shares or the
Warrant Shares, the Company shall determine to prepare and file with the
Commission a registration statement relating to an offering for its own account
or the account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or its then equivalents relating to equity securities to be
issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with stock option or other employee
benefit plans, the Company shall send to each holder of Registrable Securities
written notice of such determination and, if within thirty (30) days after
receipt of such notice, any such holder shall so request in writing (which
request shall specify the Registrable Securities intended to be disposed of by
the Holders), the Company will cause the registration under the Securities Act
of all Registrable Securities which the Company has been so requested to
register by the holder, to the extent requisite to permit the disposition of the
Registrable Securities so to be registered, provided that if at any time after
giving written notice of its intention to register any securities and prior to
the effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay registration of such securities, the Company may, at its election, give
written notice of such determination to such holder and, thereupon, (i) in the
case of a determination not to register, shall be relieved of its obligation to
register any Registrable Securities in connection with such registration (but
not from its obligation to pay expenses in accordance with Section 4 hereof),
and (ii) in the case of a determination to delay registering, shall be permitted
to delay registering any Registrable Securities being registered pursuant to
this Section 7(d) for the same period as the delay in registering such other
securities. The Company shall include in such registration statement all or any
part of such Registrable Securities such holder requests to be registered;
PROVIDED, HOWEVER, that the Company shall not be required to register any
Registrable Securities pursuant to this Section 7(d) that are eligible for sale
pursuant to Rule 144(k) of the Securities Act.  In the case of an underwritten
public offering, if the managing underwriter(s) or underwriter(s) should
reasonably object to the inclusion of the Registrable Securities in such
registration statement, then if the Company after consultation with the managing
underwriter should reasonably determine that the inclusion of such Registrable
Securities, would materially adversely affect the offering contemplated in such
registration statement, and based on such determination recommends inclusion in
such registration statement of fewer or none of the Registrable Securities of
the Holders, then (x) the number of Registrable Securities of the Holders
included in such registration statement shall be reduced pro-rata among such
Holders (based upon the number of Registrable Securities requested to be
included in the registration), if the Company after consultation with the
underwriter(s) recommends the inclusion of fewer Registrable Securities, or (y)
none of the Registrable Securities of the Holders shall be included in such
registration statement, if the Company after consultation with the
underwriter(s) recommends the inclusion of none of such Registrable Securities;
PROVIDED, HOWEVER, that if securities are being offered for the account of other
persons or entities as well as the Company, such reduction shall not represent a
greater fraction of the number of Registrable Securities intended to be offered
by the Holders than the fraction of similar reductions imposed on such other
persons or entities (other than the Company).

                                       14
<PAGE>

              (e)    FAILURE TO FILE REGISTRATION STATEMENT AND OTHER EVENTS.
The Company and the Purchasers agree that the Holders will suffer damages if the
Registration Statement is not filed on or prior to the Filing Date and not
declared effective by the Commission on or prior to the Effectiveness Date and
maintained in the manner contemplated herein during the Effectiveness Period or
if certain other events occur.  The Company and the Holders further agree that
it would not be feasible to ascertain the extent of such damages with precision.
Accordingly, other than permitted by Section 3(o) hereof, if (i) the
Registration Statement is not filed on or prior to the Filing Date, or is not
declared effective by the Commission on or prior to the Effectiveness Date (or
in the event an additional Registration Statement is filed because the actual
number of shares of Common Stock into which the Debentures or shares of
Preferred Stock, as applicable, are convertible exceeds the number of shares of
Common Stock initially registered is not filed and declared effective within the
time periods set forth in Section 2(a)), or (ii) the Company fails to file with
the Commission a request for acceleration in accordance with Rule 461 of the
Securities Act within five (5) Business Days of the date that the Company is
notified (orally or in writing, whichever is earlier) by the Commission that a
Registration Statement will not be "reviewed," or not subject to further review,
or (iii) the Registration Statement is filed with and declared effective by the
Commission but thereafter ceases to be effective as to all Registrable
Securities at any time prior to the expiration of the Effectiveness Period,
without being succeeded immediately by a subsequent Registration Statement filed
with and declared effective by the Commission, or (iv) trading in the Common
Stock shall be suspended or if the Common Stock is delisted from the OTC
Bulletin Board for any reason for more than three (3) Business Days in the
aggregate, or (v) the conversion rights of the Holders are suspended for any
reason, including by the Comany, or (vi) the Company breaches in a material
respect any covenant or other material term or condition to this Agreement, the
Debentures, the Purchase Agreement (other than a representation or warranty
contained therein) or any other agreement, document, certificate or other
instrument delivered in connection with the transactions contemplated hereby and
thereby, and such breach continues for a period of thirty (30) days after
written notice thereof to the Company, or (vii) the Company has breached Section
3(n) of this Agreement (any such failure or breach being referred to as an
"EVENT"), the Company shall pay in cash as liquidated damages for such failure
and not as a penalty to each Holder an amount (the "LIQUIDATED DAMAGES") equal
to 2% of such Holder's pro rata share of (A) the principal amount of the
Debentures purchased and then outstanding pursuant to the Purchase Agreement or
(B) the Liquidation Preference Amount (as defined by the Company's Articles of
Incorporation, as amended pursuant to the Purchase Agreement) of the Preferred
Stock exchanged for such Debentures and outstanding pursuant to the Exchange
Agreement, for each thirty (30) day period until the applicable Event has been
cured, which shall be pro rated for any period less than thirty (30) days (the
"PERIODIC AMOUNT"); PROVIDED, HOWEVER, that in the case of the Company's failure
to file the Registration Statement on or prior to the Filing Date, the Periodic
Amount shall not be pro rated for any period less than thirty (30) days, but
rather rounded up to the next full thirty (30) day period for any portion
thereof prior to being cured. Payments to be made pursuant to this Section 7(e)
shall be due and payable immediately upon demand at the option of the Holders in
immediately available funds or as an accrual to the Outstanding Principal Amount
(as defined in the Debentures) or the Liquidation Preference Amount.  The
parties agree that the Periodic Amount represents a reasonable estimate on the
part of the parties, as of the date of this Agreement, of the amount of damages
that may be incurred by the Holders if the Registration Statement is not filed
on or prior to the Filing Date or has not

                                       15
<PAGE>

been declared effective by the Commission on or prior to the Effectiveness
Date and maintained in the manner contemplated herein during the
Effectiveness Period or if any other Event as described herein has occurred.

              (f)    SPECIFIC ENFORCEMENT, CONSENT TO JURISDICTION.

                     (i)    The Company and the Purchasers acknowledge and
       agree that irreparable damage would occur in the event that any of the
       provisions of this Registration Rights Agreement or the Purchase
       Agreement were not performed in accordance with their specific terms or
       were otherwise breached.  It is accordingly agreed that the parties shall
       be entitled to an injunction or injunctions to prevent or cure breaches
       of the provisions of this Registration Rights Agreement or the Purchase
       Agreement and to enforce specifically the terms and provisions hereof or
       thereof, this being in addition to any other remedy to which any of them
       may be entitled by law or equity.

                     (ii)   Each of the Company and the Purchasers (i) hereby
       irrevocably submits to the jurisdiction of the United States District
       Court sitting in the Southern District of New York for the purposes of
       any suit, action or proceeding arising out of or relating to this
       Agreement or the Purchase Agreement and (ii) hereby waives, and agrees
       not to assert in any such suit, action or proceeding, any claim that it
       is not personally subject to the jurisdiction of such court, that the
       suit, action or proceeding is brought in an inconvenient forum or that
       the venue of the suit, action or proceeding is improper.  Each of the
       Company and the Purchasers consents to process being served in any such
       suit, action or proceeding by mailing a copy thereof to such party at the
       address in effect for notices to it under this Agreement and agrees that
       such service shall constitute good and sufficient service of process and
       notice thereof.  Nothing in this Section 7(f) shall affect or limit any
       right to serve process in any other manner permitted by law.

              (g)    AMENDMENTS AND WAIVERS.  The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and each of the Holders.  Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders and that does not directly or indirectly
affect the rights of other Holders may be given by Holders of at least a
majority of the Registrable Securities to which such waiver or consent relates;
PROVIDED, HOWEVER, that the provisions of this sentence may not be amended,
modified, or supplemented except in accordance with the provisions of the
immediately preceding sentence.

              (h)    NOTICES.  Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earlier of (i) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile telephone number specified for notice prior to 5:00 p.m., pacific
standard time, on a Business Day, (ii) the Business Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile telephone number specified for notice later than 5:00 p.m., pacific
standard time, on any date and earlier than 11:59 p.m., pacific time, on such
date, (iii) the Business Day following the date of mailing, if sent by

                                       16
<PAGE>

nationally recognized overnight courier service or (iv) actual receipt by the
party to whom such notice is required to be given.  The addresses for such
communications shall be with respect to each Holder at its address set forth
under its name on SCHEDULE 1 attached hereto, or with respect to the Company,
addressed to:

                            Internet Sports Network, Inc.
                            101 Bloor Street West, Suite 200
                            Toronto, Ontario  M5S 2Z7
                            Attention: David Toews
                            Telephone No.: 416-599-8800
                            Facsimile No.: 416-921-1302

or to such other address or addresses or facsimile number or numbers as any such
party may most recently have designated in writing to the other parties hereto
by such notice.  Copies of notices to any Holder shall be sent to the addresses
listed on Schedule 1 attached hereto, if applicable.  Copies of notices to the
Company shall be sent to Akerman, Senterfitt & Eidson, P.A., One S.E. 3rd
Avenue, 28th Floor, Miami, Florida 33131, Attn: Kara MacCullough, Esq.,
Facsimile No.: (305) 374-5095.  Copies of notices to the Holders shall be sent
to Parker Chapin LLP, The Chrysler Building, 405 Lexington Avenue, New York,
New York 10174, Attention: Christopher S. Auguste, Esq., Facsimile
No.: (212) 704-6288.

              (i)    SUCCESSORS AND ASSIGNS.  This Agreement shall be binding
upon and inure to the benefit of the parties and their successors and permitted
assigns and shall inure to the benefit of each Holder and its successors and
assigns.  The Company may not assign this Agreement or any of its rights or
obligations hereunder without the prior written consent of each Holder.  Each
Purchaser may assign its rights hereunder in the manner and to the Persons as
permitted under the Purchase Agreement.

              (j)    ASSIGNMENT OF REGISTRATION RIGHTS.  The rights of each
Holder hereunder, including the right to have the Company register for resale
Registrable Securities in accordance with the terms of this Agreement, shall be
automatically assignable by each Holder to any transferee of such Holder of all
or a portion of the Debentures or Preferred Stock, as the case may be, or the
Registrable Securities if:  (i) the Holder agrees in writing with the transferee
or assignee to assign such rights, and a copy of such agreement is furnished to
the Company within a reasonable time after such assignment, (ii) the Company is,
within a reasonable time after such transfer or assignment, furnished with
written notice of (a) the name and address of such transferee or assignee, and
(b) the securities with respect to which such registration rights are being
transferred or assigned, (iii) following such transfer or assignment the further
disposition of such securities by the transferee or assignees is restricted
under the Securities Act and applicable state securities laws, (iv) at or before
the time the Company receives the written notice contemplated by clause (ii) of
this Section, the transferee or assignee agrees in writing with the Company to
be bound by all of the provisions of this Agreement, and (v) such transfer shall
have been made in accordance with the applicable requirements of the Purchase
Agreement.  In addition, each Holder shall have the right to assign its rights
hereunder to any other Person with the prior written consent of the Company,
which consent shall not be unreasonably withheld.  The rights to assignment
shall apply to the Holders (and to subsequent) successors and assigns.

                                       17
<PAGE>

              (k)    COUNTERPARTS.  This Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be
an original and, all of which taken together shall constitute one and the
same Agreement.  In the event that any signature is delivered by facsimile
transmission, such signature shall create a valid binding obligation of the
party executing (or on whose behalf such signature is executed) the same with
the same force and effect as if such facsimile signature were the original
thereof.

              (l)    GOVERNING LAW.  This 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 law thereof.

              (m)    CUMULATIVE REMEDIES.  The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.

              (n)    SEVERABILITY.  If any term, provision, covenant or
restriction of this Agreement is held to be invalid, illegal, void or
unenforceable in any respect, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as
that contemplated by such term, provision, covenant or restriction.  It is
hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and
restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.

              (o)    HEADINGS.  The headings herein are for convenience only,
do not constitute a part of this Agreement and shall not be deemed to limit
or affect any of the provisions hereof.

              (p)    SHARES HELD BY THE COMPANY AND ITS AFFILIATES. Whenever
the consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Company
or its Affiliates (other than any Holder or transferees or successors or
assigns thereof if such Holder is deemed to be an Affiliate solely by reason
of its holdings of such Registrable Securities) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage and shall not be counted as outstanding.

              (q)    NOTICE OF EFFECTIVENESS.  Within two (2) business days
after the Registration Statement which includes the Registrable Securities is
ordered effective by the Commission, the Company shall deliver, and shall
cause legal counsel for the Company to deliver, to the transfer agent for
such Registrable Securities (with copies to the Holders whose Registrable
Securities are included in such Registration Statement) confirmation that the
Registration Statement has been declared effective by the Commission in the
form attached hereto as EXHIBIT A.

                    [remainder of page intentionally left blank]

                                       18
<PAGE>

       IN WITNESS WHEREOF, the parties hereto have caused this Registration
Rights Agreement to be duly executed by their respective authorized persons
as of the date first indicated above.

                                          INTERNET SPORTS NETWORK, INC.

                                          BY:  /S/ ANDY DEFRANCESCO
                                                 Name: Andy DeFrancesco
                                                 Title: President

                      [SIGNATURES CONTINUED ON THE NEXT PAGE]

<PAGE>

                      [SIGNATURES CONTINUED FROM PREVIOUS PAGE]
                                   LIVINGSTON KOSBERG TRUST

                                   By:_/s/ Livingston Kosberg
                                       Name: /s/ Livingston Kosberg
                                       Title: Trustee

                                   ANEGADA FUND LTD.

                                   By: /s/ Carlo Cull
                                    Name: Carlo Cull
                                      Title:

                                   CUTTYHUNK FUND LTD.

                                   By:  /s/ Geoffrey M. Lewis
                                    Name:  /s/ Geoffrey M. Lewis
                                      Title: Director

                                   TONGA PARTNERS, LP

                                   By: /s/ Carlo Cull
                                    Name: Carlo Cull
                                      Title:

                                   ASPEN INTERNATIONAL, LTD.

                                   By:/s/ Diedre M. McCoy
                                   Name: Diedre M. McCoy
                                     Title: Director

<PAGE>

                                  SCHEDULE 1 TO THE
                           REGISTRATION RIGHTS AGREEMENT
                          FOR INTERNET SPORTS NETWORK, INC.

NAMES AND ADDRESS OF PURCHASERS

J. LIVINGSTON KOSBERG, TRUSTEE FOR
THE LIVINGSTON KOSBERG TRUST
c/o 600 California Street, 14th Floor
San Francisco, California 94108

ANEGADA FUND LTD.
c/o 600 California Street, 14th Floor
San Francisco, California 94108

CUTTYHUNK FUND LTD.
c/o 600 California Street, 14th Floor
San Francisco, California 94108

TONGA PARTNERS, LP
c/o 600 California Street, 14th Floor
San Francisco, California 94108

ASPEN INTERNATIONAL, LTD.
c/o 600 California Street, 14th Floor
San Francisco, California 94108

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00013-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00013-of-00352.parquet"}]]