Document:

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                                                                    EXHIBIT 10.2

                          AMERICAN PULP EXCHANGE, INC.

                         COMMON STOCK PURCHASE AGREEMENT

         This Common Stock Purchase Agreement (this "AGREEMENT") is made and
entered into as of November 1, 2002, by and between American Pulp Exchange,
Inc., a Florida corporation (the "CORPORATION"), and PH Capital Holdings, LLC, a
California limited liability company (the "INVESTOR").

         WHEREAS, the Corporation desires to sell to the Investor, and the
Investor desires to purchase from the Corporation, shares of the Corporation's
Common Stock on the terms and conditions set forth in this Agreement;

         NOW, THEREFORE, the parties hereby agree as follows:

         1. AGREEMENT TO PURCHASE AND SELL STOCK.

            1.1 AUTHORIZATION. As of the Closing (as defined below), the
Corporation will have authorized the sale and issuance, pursuant to the terms
and conditions of this Agreement, of Two Million Two Hundred Twenty-Five
Thousand (2,225,000) shares of the Corporation's Common Stock, $0.0025 par value
per share (the "PURCHASED SHARES").

            1.2 AGREEMENT TO PURCHASE AND SELL. The Corporation agrees to sell
to the Investor at the Closing, and the Investor agrees to purchase from the
Corporation at the Closing, the Purchased Shares, at a per share purchase price
of One Cent ($0.01), and at the aggregate purchase price of Twenty-Two Thousand
Two Hundred Fifty Dollars ($22,250.00).

         2. CLOSING. The purchase and sale of the Purchased Shares will take
place at the offices of Pachulski, Stang, Ziehl, Young & Jones P.C., 10100 Santa
Monica Boulevard, Suite 1100, Los Angeles, California 90067, at 10:00 a.m.
Pacific Time, on November 4, 2002 or at such other time and place as the
Corporation and the Investor mutually agree upon (which time and place are
referred to in this Agreement as the "CLOSING"). At the Closing, the Corporation
will deliver to the Investor a share certificate representing the Purchased
Shares that the Investor has agreed to purchase against delivery to the
Corporation by such Investor of the full purchase price of such Purchased
Shares, paid in cash by wire transfer of funds to the Corporation.

         3. REPRESENTATIONS AND WARRANTIES OF THE CORPORATION. The Corporation
hereby represents and warrants to the Investor that the statements in the
following paragraphs of this Section 3 are all true and complete immediately
prior to the Closing:

            3.1 ORGANIZATION, GOOD STANDING, CORPORATE POWER AND QUALIFICATION.
The Corporation has been duly incorporated and organized, and is validly
existing in good standing, under the laws of the State of Florida. The
Corporation has the requisite corporate power and authority to enter into and
perform this Agreement, to own and operate its properties and assets, if any,
and to carry on its business as currently conducted and as presently proposed to
be conducted. The Corporation is not presently qualified to do business as a
foreign corporation in any jurisdiction and the failure to be so qualified will
not have a materially adverse affect on the Corporation's business as now
conducted or as now proposed to be conducted.
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            3.2 CAPITALIZATION. The capitalization of the Corporation
immediately prior to the Closing consists of the following:

                (a) PREFERRED STOCK. A total of 20,000,000 authorized shares of
preferred stock, $0.0025 par value per share (the "PREFERRED STOCK"), consisting
of shares designated as "SERIES A PREFERRED STOCK," none of which will be issued
and outstanding, and shares designated as "SERIES B PREFERRED STOCK," none of
which will be issued and outstanding.

                (b) COMMON STOCK. A total of 50,000,000 authorized shares of
Common Stock, $ 0.0025 par value per share (the "COMMON STOCK"), of which
4,345,000 shares will be issued and outstanding.

                (c) OPTIONS, WARRANTS, RESERVED SHARES. Except under this
Agreement, the Stock Purchase Agreement dated October 22, 2002 between Al Siegel
and Vector Partners, LLC, the Common Stock Purchase Agreement dated as of even
date herewith between the Corporation and Vector Partners, LLC, to the
Corporation's knowledge (a) there is no outstanding option, warrant, right
(including conversion or preemptive rights) or agreement for the purchase or
acquisition from the Corporation of any shares of its capital stock or any
securities convertible into or ultimately exchangeable or exercisable for any
shares of the Corporation's capital stock and (b) no shares of the Corporation's
outstanding capital stock are subject to any preemptive rights, rights of first
refusal or other rights to purchase such stock.

            3.3 DUE AUTHORIZATION. All corporate action on the part of the
Corporation's director(s) and shareholders necessary for (i) the authorization,
execution, delivery of, and the performance of all obligations of the
Corporation under, this Agreement and (ii) the authorization, issuance,
reservation for issuance and delivery of all of the Purchased Shares being sold
under this Agreement has been taken or will be taken prior to the Closing. This
Agreement, when executed and delivered, will constitute, valid and legally
binding obligations of the Corporation, enforceable in accordance with their
respective terms, except as may be limited by (i) applicable bankruptcy,
insolvency, reorganization or others laws of general application relating to or
affecting the enforcement of creditors' rights generally and (ii) the effect of
rules of law governing the availability of equitable remedies.

            3.4 VALID ISSUANCE OF STOCK.

                (a) The Purchased Shares, when paid for and issued as provided
in this Agreement, will be duly authorized and validly issued, fully paid and
nonassessable.

                (b) Based in part on the representations made by the Investor in
Section 4 hereof, the offer and sale of the Purchased Shares solely to the
Investor in accordance with this Agreement are exempt from the registration and
prospectus delivery requirements of the Securities Act of 1933, as amended (the
"SECURITIES ACT") and the securities registration and qualification requirements
of the currently effective provisions of the securities laws of the State in
which the Investor is resident.

            3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on
the part of the Corporation in order to enable the Corporation to execute,
deliver and perform its obligations under this Agreement except for such
qualifications or filings under applicable securities laws as may be required in
connection with the transactions contemplated by this Agreement. All such
qualifications and filings will, in the case of qualifications, be effective on
the Closing and will, in the case of filings, be made within the time prescribed
by law.

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            3.6 REGISTRATION RIGHTS. The Corporation is not under any obligation
to register under the Securities Act any of its currently outstanding securities
or any securities issuable upon exercise or conversion of its currently
outstanding securities nor is the Corporation obligated to register or qualify
any such securities under any state securities or blue sky laws.

         4. REPRESENTATIONS, WARRANTIES AND CERTAIN AGREEMENTS OF THE INVESTOR.
The Investor hereby represents and warrants to, and agrees with, the Corporation
that:

            4.1 AUTHORIZATION. This Agreement constitutes such Investor's valid
and legally binding obligation, enforceable in accordance with its terms except
as may be limited by (i) applicable bankruptcy, insolvency, reorganization or
other laws of general application relating to or affecting the enforcement of
creditors' rights generally and (ii) the effect of rules of law governing the
availability of equitable remedies. The Investor represents that such Investor
has full power and authority to enter into this Agreement.

            4.2 PURCHASE FOR OWN ACCOUNT. The Purchased Shares to be purchased
by such Investor hereunder will be acquired for investment for such Investor's
own account, not as a nominee or agent, and not with a view to the public resale
or distribution thereof within the meaning of the Securities Act, and such
Investor has no present intention of selling, granting any participation in, or
otherwise distributing the same. The Investor also represents that it has not
been formed for the specific purpose of acquiring the Purchased Shares.

            4.3 DISCLOSURE OF INFORMATION. At no time was the Investor presented
with or solicited by any publicly issued or circulated newspaper, mail, radio,
television or other form of general advertising or solicitation in connection
with the offer, sale and purchase of the Purchased Shares. Such Investor has
received or has had full access to all the information it considers necessary or
appropriate to make an informed investment decision with respect to the
Purchased Shares to be purchased by such Investor under this Agreement. Such
Investor further has had an opportunity to ask questions and receive answers
from the Corporation regarding the terms and conditions of the offering of the
Purchased Shares and to obtain additional information (to the extent the
Corporation possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify any information furnished to such
Investor or to which such Investor had access.

            4.4 INVESTMENT EXPERIENCE. Such Investor understands that the
purchase of the Purchased Shares involves substantial risk. Such Investor: (i)
has experience as an investor in securities of troubled and distressed companies
and acknowledges that such Investor is able to fend for itself, can bear the
economic risk of such Investor's investment in the Purchased Shares and has such
knowledge and experience in financial or business matters that such Investor is
capable of evaluating the merits and risks of this investment in the Purchased
Shares and protecting its own interests in connection with this investment
and/or (ii) has a preexisting personal or business relationship with the
Corporation and certain of its officers, directors or controlling persons of a
nature and duration that enables such Investor to be aware of the character,
business acumen and financial circumstances of such persons.

            4.5 ACCREDITED INVESTOR STATUS. Such Investor is an "accredited
investor" within the meaning of Regulation D promulgated under the Securities
Act.

            4.6 RESTRICTED SECURITIES. Such Investor understands that the
Purchased Shares are characterized as "restricted securities" under the
Securities Act inasmuch as they are being acquired from the Corporation in a
transaction not involving a public offering and that under the Securities Act
and applicable regulations thereunder such securities may be resold without
registration under the Securities Act only in certain limited circumstances. In
this connection, such Investor represents that such Investor is familiar with
Rule 144 of the U.S. Securities and Exchange Commission (the "SEC"), as
presently in effect, and understands the

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resale limitations imposed thereby and by the Securities Act. Such Investor
understands that the Corporation is under no obligation to register any of the
securities sold hereunder except as provided in the Registration Rights
Agreement.

            4.7 FURTHER LIMITATIONS ON DISPOSITION. Without in any way limiting
the representations set forth above, such Investor further agrees not to make
any disposition of all or any portion of the Purchased Shares unless and until:

                (a) there is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such registration statement; or

                (b) such Investor shall have notified the Corporation of the
proposed disposition and shall have furnished the Corporation with a statement
of the circumstances surrounding the proposed disposition, and, at the expense
of such Investor or its transferee, with an opinion of counsel, reasonably
satisfactory to the Corporation, that such disposition will not require
registration of such securities under the Securities Act.

         Notwithstanding the provisions of paragraphs (a) and (b) above, no such
registration statement or opinion of counsel shall be required for any transfer
of any Purchased Shares in compliance with SEC Rule 144.

            4.8 "MARKET STAND-OFF" AGREEMENT. The Investor hereby agrees that it
shall not, to the extent requested by the Corporation or an underwriter of
securities of the Corporation, sell or otherwise transfer or dispose of any
Purchased Shares or other shares of stock of the Corporation then owned by such
Investor (other than to donees or partners of the Investor who agree to be
similarly bound) for up to One Hundred Eighty (180) days following the effective
date of any registration statement of the Corporation filed under the Securities
Act; provided that, notwithstanding a request by the Corporation, Investor shall
not be restricted under this Section 4.8 from selling or otherwise transferring
or disposing of any Purchased Shares or other shares of stock of the Corporation
at any time prior to the effective date of any registration statement.

         In order to enforce the foregoing covenant, the Corporation shall have
the right to place restrictive legends on the certificates representing the
shares subject to this Section and to impose stop transfer instructions with
respect to the Purchased Shares and such other shares of stock of the Investor
(and the shares or securities of every other person subject to the foregoing
restriction) until the end of such period. The Investor further agrees to enter
into any agreement reasonably required by the underwriters to implement the
foregoing within any reasonable timeframe so requested.

            4.9 LEGENDS. It is understood that the certificates evidencing the
Purchased Shares will bear the legends substantially similar to those set forth
below:

                (a) THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE
SECURITIES LAWS OF ANY OTHER JURISDICTIONS. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE ISSUER OF THESE SECURITIES
MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE
ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH
THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

         THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A 180 DAY
MARKET STAND-OFF RESTRICTION AS SET FORTH IN A CERTAIN

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AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF
WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. AS A RESULT OF SUCH
AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO 180 DAYS AFTER THE EFFECTIVE
DATE OF THE INITIAL PUBLIC OFFERING OF THE COMMON STOCK OF THE ISSUER HEREOF.
SUCH RESTRICTION IS BINDING ON TRANSFEREES OF THESE SHARES.

                (b) Any legends required by applicable state securities laws.

                (c) Any legends required by any agreement(s) between the
Corporation and the Investor.

         The first legend set forth in (a) above shall be removed by the
Corporation from any certificate evidencing Purchased Shares upon delivery to
the Corporation of an opinion by counsel, reasonably satisfactory to the
Corporation, that a registration statement under the Securities Act is at that
time in effect with respect to the legended security or that such security can
be freely transferred in a public sale without such a registration statement
being in effect and that such transfer will not jeopardize the exemption or
exemptions from registration pursuant to which the Corporation issued the
Purchased Shares.

         5. CONDITIONS TO INVESTOR'S OBLIGATIONS AT CLOSING. The obligations of
the Investor under Section 2 of this Agreement are subject to the fulfillment or
waiver, on or before the Closing, of each of the following conditions, the
waiver of which shall not be effective unless the Investor consents to such
waiver, which consent may be given by written, oral or telephone communication
to the Corporation:

            5.1 REPRESENTATIONS AND WARRANTIES TRUE. Each of the representations
and warranties of the Corporation contained in Section 3 hereof shall be true
and complete on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of the date of the
Closing.

            5.2 PERFORMANCE. The Corporation shall have performed and complied
with all agreements, obligations and conditions contained in this Agreement that
are required to be performed or complied with by it on or before the Closing and
shall have obtained all approvals, consents and qualifications necessary to
complete the purchase and sale described herein.

            5.3 SECURITIES EXEMPTIONS. The offer and sale of the Purchased
Shares to the Investor pursuant to this Agreement shall be exempt from the
registration requirements of the Securities Act and the registration and/or
qualification requirements of all other applicable state securities laws.

            5.4 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated at the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to the Investor and to the Investor's counsel, and they shall each
have received all such counterpart originals and certified or other copies of
such documents as they may reasonably request.

         6. CONDITIONS TO THE CORPORATION'S OBLIGATIONS AT CLOSING. The
obligations of the Corporation to the Investor under this Agreement are subject
to the fulfillment or waiver on or before the Closing of each of the following
conditions by such Investor:

            6.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of such Investor contained in Section 4 shall be true and complete on
the date of the Closing with the same effect as though such representations and
warranties had been made on and as of the Closing.

            6.2 PAYMENT OF PURCHASE PRICE. The Investor shall have delivered to
the Corporation the purchase price specified in Section 2.

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            6.3 SECURITIES EXEMPTIONS. The offer and sale of the Purchased
Shares to the Investor pursuant to this Agreement shall be exempt from the
registration requirements of the Securities Act and the registration and/or
qualification requirements of all other applicable state securities laws.

            6.4 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated at the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to the Corporation and to the Corporation's legal counsel, and the
Corporation shall have received all such counterpart originals and certified or
other copies of such documents as it may reasonably request.

         7. GENERAL PROVISIONS.

            7.1 SURVIVAL OF WARRANTIES. The representations, warranties and
covenants of the Corporation and the Investor contained in or made pursuant to
this Agreement shall survive the execution and delivery of this Agreement and
the Closing and shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of the Investor, their counsel or the
Corporation, as the case may be.

            7.2 SUCCESSORS AND ASSIGNS. Except as otherwise provided in this
Agreement, this Agreement, and the rights and obligations of the parties
hereunder, will be binding upon and inure to the benefit of their respective
successors, assigns, heirs, executors, administrators and legal representatives.

            7.3 GOVERNING LAW. This Agreement will be governed by and construed
in accordance with the laws of the State of California, without giving effect to
that body of laws pertaining to conflict of laws.

            7.4 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered will be deemed an
original, and all of which together shall constitute one and the same agreement.

            7.5 TITLES AND HEADINGS. The titles, captions and headings of this
Agreement are included for ease of reference only and will be disregarded in
interpreting or construing this Agreement. Unless otherwise specifically stated,
all references herein to "sections" will mean "sections" to this Agreement.

            7.6 NOTICES. All notices, requests, demands and other communications
which are required to be given under this Agreement shall be in writing and
shall be deemed to have been duly given, made and received only when transmitted
if: (a) transmitted by facsimile, upon printed confirmation of complete
transmission by facsimile; (b) delivered (personally, by courier service or by
other messenger; or (c) when deposited in the United States mails, registered or
certified mail, postage prepaid, return receipt requested, addressed as set
forth below:

                (a) if to the Investor:

                    PH Capital Holdings, LLC
                    Attention:  Charles Samel
                    16 East 67th Street
                    New York, New York  10021

                (b) if to the Corporation:

                    American Pulp Exchange, Inc.
                    Attention:  President
                    1518 North Beverly Drive
                    Beverly Hills, California 90210

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                    With a copy to:

                    Robert J. Feinstein, Esq.
                    Pachulski, Stang, Ziehl, Young & Jones P.C.
                    461 Fifth Ave
                    25th Floor
                    New York, New York  10017

            7.7 NO FINDER'S FEES. Each party represents that it neither is nor
will be obligated for any finder's or broker's fee or commission in connection
with this transaction. The Investor agrees to indemnify and to hold harmless the
Corporation from any liability for any commission or compensation in the nature
of a finders' or broker's fee (and any asserted liability) for which the
Investor or any of its officers, partners, employees, or representatives is
responsible. The Corporation agrees to indemnify and hold harmless the Investor
from any liability for any commission or compensation in the nature of a
finder's or broker's fee (and any asserted liability) for which the Corporation
or any of its officers, employees or representatives is responsible.

            7.8 AMENDMENTS AND WAIVERS. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Corporation and the
Investor. Any amendment or waiver effected in accordance with this Section shall
be binding upon the Investor, each future holder of the Purchased Shares, and
the Corporation. No delay or failure to require performance of any provision of
this Agreement shall constitute a waiver of that provision as to that or any
other instance. No waiver granted under this Agreement as to any one provision
herein shall constitute a subsequent waiver of such provision or of any other
provision herein, nor shall it constitute the waiver of any performance other
than the actual performance specifically waived.

            7.9 SEVERABILITY. If any provision of this Agreement is determined
by any court or arbitrator of competent jurisdiction to be invalid, illegal or
unenforceable in any respect, such provision will be enforced to the maximum
extent possible given the intent of the parties hereto. If such clause or
provision cannot be so enforced, such provision shall be stricken from this
Agreement and the remainder of this Agreement shall be enforced as if such
invalid, illegal or unenforceable clause or provision had (to the extent not
enforceable) never been contained in this Agreement. Notwithstanding the
forgoing, if the value of this Agreement based upon the substantial benefit of
the bargain for any party is materially impaired, which determination as made by
the presiding court or arbitrator of competent jurisdiction shall be binding,
then both parties agree to substitute such provision(s) through good faith
negotiations.

            7.10 ENTIRE AGREEMENT. This Agreement and the documents referred to
herein constitute the entire agreement and understanding of the parties with
respect to the subject matter of this Agreement, and supersede any and all prior
understandings and agreements, whether oral or written, between or among the
parties hereto with respect to the specific subject matter hereof.

            7.11 FURTHER ASSURANCES. The parties agree to execute such further
documents and instruments and to take such further actions as may be reasonably
necessary to carry out the purposes and intent of this Agreement.

            7.12 FACSIMILE SIGNATURES. This Agreement may be executed and
delivered by facsimile and upon such delivery the facsimile signature will be
deemed to have the same effect as if the original signature had been delivered
to the other party.

            7.13 THIRD PARTIES. Nothing in this Agreement, express or implied,
is intended to confer upon any person, other than the parties hereto and their
successors and assigns, any rights or remedies under or by reason of this
Agreement.

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            7.14 COSTS AND ATTORNEYS' FEES. In the event that any action, suit
or other proceeding is instituted concerning or arising out of this Agreement or
any transaction contemplated hereunder, the prevailing party shall recover all
of such party's costs and attorneys' fees incurred in each such action, suit or
other proceeding, including any and all appeals or petitions therefrom.

         [THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]

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

THE CORPORATION:

AMERICAN PULP EXCHANGE, INC.,
a Florida corporation

By:      s/s Jason Galanis
         --------------------------------------------
Name:    Jason Galanis
Title:   Chairman, President, CFO and Secretary

INVESTOR:

PH CAPITAL HOLDINGS, LLC,
a California limited liability company

By:      s/s Charles Samel
         --------------------------------------------
Name:    Charles Samel
Title:   Manager

               [SIGNATURE PAGE TO COMMON STOCK PURCHASE AGREEMENT]<PAGE>
                                                                    Exhibit 10.3

                          AMERICAN PULP EXCHANGE, INC.

                                       AND

                              VECTOR PARTNERS, LLC

                                WARRANT AGREEMENT

                          DATED AS OF NOVEMBER 9, 2002
<PAGE>
                                WARRANT AGREEMENT

         This WARRANT AGREEMENT (this "AGREEMENT") is made and entered into as
of November 9, 2002, by and between American Pulp Exchange, Inc., a Florida
corporation (the "COMPANY"), and Vector Partners, LLC, a Nevada limited
liability company (the "HOLDER").

         The Company and the Holder hereby agree as follows:

SECTION 1. ISSUANCE OF THE WARRANT. Subject to the terms and conditions of this
Agreement, the Company hereby agrees to issue to the Holder a warrant
substantially in the form attached hereto as Exhibit A (the "WARRANT") to
purchase up to an aggregate of Five Hundred Seventy-Five Thousand (575,000)
shares of common stock, par value $0.0025 per share, of the Company (the "COMMON
STOCK"), at the Exercise Price (as defined in Section 2.3 below). The shares of
fully paid, duly authorized and non-assessable Common Stock issuable upon
exercise of the Warrant are referred to herein as the "WARRANT SHARES."

SECTION  2. TERM OF THE WARRANT; EXERCISE OF THE WARRANT; RESTRICTIONS
            ON EXERCISE; EXERCISE PRICE.

         2.1 TERM OF THE WARRANT. Subject to the terms and conditions of this
Agreement, the Holder shall have the right to purchase the Warrant Shares from
the Company. The Holder's right to purchase the Warrant Shares (a) may be
exercised, in whole or in part, at any time on or after the first business day
following the payment in full of all indebtedness under the Series C Notes in a
Qualified Refinancing and (b) shall expire at 5:00 p.m., Pacific time, on the
earlier of (x) the fifth anniversary of the day on which the Warrant first
becomes exercisable under clause (a) of this Section 2.1 or (y) if the Warrant
does not become exercisable on or before the maturity date of the Series C
Notes, the maturity date of the Series C Notes (the "EXPIRATION DATE"). If the
Warrant is not exercised on or prior to the Expiration Date, then the Warrant
shall become void, and all rights thereunder in respect thereof under this
Agreement shall cease at such time. For purposes of this Agreement, "BUSINESS
DAY" means any day, other than a Saturday, Sunday, or a day on which commercial
banks are required or permitted to be closed for business, "QUALIFIED
REFINANCING" means any equity or debt financing transaction completed by GM and
originated or arranged by the Holder, the net proceeds of which are sufficient,
and are used, to pay in full all indebtedness under the Series C Notes on or
before the maturity date thereof, "SERIES C NOTES" means the Series C 15% Senior
Secured Notes of GM, and "GM" means General Media, Inc., a Delaware corporation.

         2.2 EXERCISE OF THE WARRANT. The Holder may exercise the Warrant upon
surrender to the Company, at its principal office, of the Warrant, together with
a completed and duly executed subscription form in substantially the form
attached hereto as Exhibit B (the "SUBSCRIPTION FORM"), and payment of the
aggregate Exercise Price (as defined in and determined in accordance with
Section 2 hereof) for the number of Warrant Shares in respect of which such
Warrant is then exercised. The aggregate Exercise Price shall be an amount equal
to the product obtained by multiplying (a) the number of Warrant Shares to be
purchased by the Holder by (b) the Exercise Price (as adjusted pursuant to
Section 6 of this Agreement). Unless the Holder has exercised its Net Exercise
Right (as defined in Section 2.4 below), payment of the aggregate Exercise Price
shall be made wire transfer of funds or by check payable to the
<PAGE>
Company's order in the amount of such aggregate Exercise Price. The Exercise
Price will be considered to have been paid only upon clearance of the wire
transfer or check; provided that if the Holder has exercised its Net Exercise
Right, the Surrendered Warrant Shares (as defined in Section 2.4 below) shall be
deemed to satisfy the payment of the Exercise Price.

         A stock certificate representing the Warrant Shares subscribed for will
be issued and delivered as soon as practicable after the conditions set forth in
this Section 2.2 have been satisfied.

         2.3 EXERCISE PRICE. The price per share at which the Warrant Shares
shall be purchasable upon exercise of the Warrant shall be $0.01 per share of
Common Stock, subject to adjustment as provided in Section 6 hereof (the
"EXERCISE PRICE").

         2.4 CASHLESS/NET EXERCISE. The Holder may exercise its right (the "NET
EXERCISE RIGHT"), prior to and including the Expiration Date, to receive Warrant
Shares on a net basis, such that, without the payment of cash, the Holder
receives that number of Warrant Shares otherwise issuable (or payable) upon
exercise of the Warrant less that number of Warrant Shares having an aggregate
fair market value (as defined below) at the time of exercise equal to the
aggregate Exercise Price that would otherwise have been paid by the Holder of
the Warrant Shares. The Holder may not exercise a Net Exercise Right unless the
fair market value of the Warrant Shares receivable upon exercise of the Warrant
(the "SURRENDERED WARRANT SHARES") is sufficient to satisfy the payment of the
Exercise Price in full. The number of Warrant Shares to be issued pursuant to
the Holder's exercise of the Net Exercise Right shall be computed using the
following formula:
                       Y(A-B)
                  X= -----------
                         A
where:

         X =      the number of Warrant Shares to be issued to the Holder
                  pursuant to this Section 2.4.

         Y =      the number of Warrant Shares as to which the Net Exercise
                  Right is being exercised.

         A =      the fair market value of one Warrant Share, as
                  determined in good faith by the Company's Board of
                  Directors (the "BOARD"), as at the time the Net
                  Exercise Right is exercised pursuant to this Section
                  2.4.

         B =      the Exercise Price (as adjusted pursuant to Section 6
                  hereof).

         For purposes of this Section 2.4, "fair market value" per Warrant Share
will be the last reported closing price of the Common Stock, which shall be (i)
if the Common Stock is listed or admitted to trading on the New York Stock
Exchange, the closing price on the NYSE-Composite Tape (or any successor
composite tape reporting transactions on the New York Stock Exchange) or, if
such a composite tape shall not be in use or shall not report transactions in
the Common Stock, or if the Common Stock shall be listed on a stock exchange
other than the New York
<PAGE>
Stock Exchange , the last reported sales price regular way or, in case no such
reported sale takes place on such day, the average of the closing bid and asked
prices regular way for such day, in each case on the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading (which shall be the national securities exchange on which the
greatest number of shares of the Common Stock have been traded during such
thirty (30) consecutive trading days), or (ii) if the Common Stock is not listed
or admitted to trading on a stock exchange, closing price of the Common Stock as
reported by The Nasdaq Stock Market or a comparable system or, if the Common
Stock is not admitted for quotation in the Nasdaq Stock Market or a comparable
system, the average of the closing bid and asked prices for the then most recent
day on which trading in the Common Stock had occurred, as furnished by the
Nasdaq OTC Bulletin Board. In the absence of one or more such closing prices,
the fair market value per Warrant Share shall be determined reasonably and in
good faith by the Board as of the date of any such exercise.

         2.5 RESTRICTIONS ON EXERCISE. The Warrant may not be exercised if the
issuance of the Warrant Shares upon such exercise would constitute a violation
of any applicable federal or state securities laws or other laws or regulations.
As a condition to the exercise of the Warrant, the Holder shall execute the
Subscription Form, confirming and acknowledging that the representations and
warranties of the Holder set forth in Section 10 hereof are true and correct as
of the date of exercise.

         2.6 PARTIAL EXERCISE. In event that the Warrant is exercised in respect
of fewer than all of the Warrant Shares issuable on such exercise at any time
prior to the Expiration Date, a new Warrant evidencing the remaining Warrant
Shares will be issued.

SECTION 3. PAYMENT OF TAXES. The Company will pay all documentary stamp taxes
attributable to any issuance of the Warrant Shares upon the exercise of the
Warrant; provided, however, that the Company shall not be required to pay any
tax or taxes which may be payable in respect of any transfer involved in the
issue of the Warrant or any certificates for Warrant Shares in a name other than
that of the registered holder of the Warrant surrendered upon the exercise of
the Warrant, and the Company shall not be required to issue or deliver any such
securities unless or until the person or persons requesting the issuance thereof
shall have paid to the Company the amount of such tax or shall have established
to the reasonable satisfaction of the Company that such tax has been paid.

SECTION 4. MUTILATED OR MISSING WARRANT. In case the Warrant shall be mutilated,
lost, stolen or destroyed, the Company may in its discretion issue and deliver
in exchange and substitution for and upon cancellation of the mutilated Warrant,
or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new
Warrant of like tenor; but only upon receipt of evidence reasonably satisfactory
to the Company of such loss, theft or destruction of such Warrant and an
agreement to indemnify the Company, if requested, also reasonably satisfactory
to the Company. Applicants for such substitute Warrant shall also comply with
such other reasonable regulations and pay such other reasonable charges as the
Company may prescribe.

SECTION 5. RESERVATION OF WARRANT SHARES. The Company shall at all times reserve
and keep available, out of its authorized and unissued shares of Common Stock,
that
<PAGE>
number of shares of Common Stock sufficient to provide for the full exercise of
the Warrant. The Company or, if appointed, the transfer agent for the Common
Stock (the "TRANSFER AGENT") and every subsequent transfer agent for any shares
of the Company's capital stock issuable upon the exercise of any of the rights
of purchase aforesaid will be irrevocably authorized and directed at all times
to reserve such number of authorized shares as shall be required for such
purpose. The Company will keep a copy of this Agreement on file with the
Transfer Agent and with every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrant.

SECTION 6. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The
           Exercise Price and the number of Warrant Shares issuable upon the
exercise of the Warrant are subject to adjustment from time to time upon the
occurrence of the events enumerated in this Section 6. For purposes of this
Section 6, "Common Stock" means shares now or hereafter authorized of any class
of common stock of the Company and any other stock of the Company, however
designated, that has the right (subject to any prior rights of any class or
series of preferred stock) to participate in any distribution of the assets or
earnings of the Company without limit as to per share amount.

                  (a)      Adjustment for Change in Capital Stock.

         If the Company:

                           (i) pays a dividend or makes a distribution on its
Common Stock in shares of its Common Stock;

                           (ii) subdivides its outstanding shares of Common
Stock into a greater number of shares;

                           (iii) combines its outstanding shares of Common Stock
into a smaller number of shares;

                           (iv) makes a distribution on its Common Stock in
shares of its capital stock other than Common Stock; or

                           (v) issues by reclassification of its Common Stock
any shares of its capital stock (including any such reclassification in
connection with a consolidation or merger in which the Company is the surviving
entity);

         then the Exercise Price in effect immediately prior to such action
shall be proportionately adjusted so that the Holder of the Warrant thereafter
exercised may receive the aggregate number and kind of shares of capital stock
of the Company which such Holder would have owned immediately following such
action if such Warrant had been exercised immediately prior to such action.

         The adjustment shall become effective immediately after the record date
in the case of a dividend or distribution and immediately after the effective
date in the case of a subdivision, combination or reclassification.
<PAGE>
         Such adjustment shall be made successively whenever any event listed
above shall occur.

                  (b)      Adjustment for Other Distributions.

         If the Company distributes to all holders of its Common Stock any of
its assets or debt securities or any rights or warrants to purchase debt
securities, assets or other securities of the Company, the Exercise Price shall
be adjusted in accordance with the formula:

                                       E-F
                              E'= Ex ---------
                                        E
where:
                  E' =     the adjusted Exercise Price.

                  E =      the current Exercise Price.

                  F =      the fair market value on the record date mentioned
                           below of the assets, securities, rights or warrants
                           distributable to shareholders per share of
                           outstanding Common Stock. The Board shall determine
                           the fair market value reasonably and in good faith.

         The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of shareholders entitled to receive the distribution.
The adjusted Exercise Price may never be less than zero. In the event that "F"
exceeds greater than one-half of "E" for any transaction or series of related
transactions, then no adjustment in "E" shall be made pursuant to the formula
contained in this clause (b) and, instead, the Company shall provide that the
Holder shall be entitled upon exercise of the Warrant, without duplication, to
its proportionate share of the assets, debt securities or such rights or
warrants as it would have been entitled to had it exercised the Warrant at the
latest time necessary to be entitled, as Warrant Share holders, to such
distribution directly.

                  (c)      When De Minimis Adjustment May Be Deferred.

         No adjustment in the Exercise Price need be made unless the adjustment
would require an increase or decrease of at least one percent (1%) in the
Exercise Price.

         All calculations under this Section shall be made to the nearest cent
or to the nearest 1/100th of a share, as the case may be.

                  (d)      When No Adjustment Required.

         No adjustment need be made for a transaction referred to in subsections
(a) or (b) of this Section 6 if the Holder is able to participate in the
transaction on a basis and with notice that the Board determines to be fair and
appropriate in light of the basis and notice on which holders of Common Stock
participate in the transaction.

         No adjustment need be made for rights to purchase Common Stock pursuant
to a Company plan for reinvestment of dividends or interest.
<PAGE>
         To the extent the Warrant becomes exercisable for cash, no adjustment
need be made thereafter as to the cash. Interest will not accrue on the cash.

                  (e)      Notice of Adjustment.

         Whenever the Exercise Price is adjusted, the Company shall provide the
notices required by Section 9 hereof.

                  (f)      Notice of Certain Transactions.

         If:

                        (i) the Company takes any action that would require an
adjustment to the Exercise Price pursuant to subsections (a) or (b) of this
Section 6 and if the Company does not arrange for the Holder to participate
pursuant to subsection (d) of this Section 6;

                        (ii) the Company takes any action that would require a
supplemental Warrant Agreement pursuant to subsection (g) of this Section 6; or

                        (iii) there is a liquidation or dissolution of the
Company,

         the Company shall mail to the Holder a notice stating the proposed
record date for a dividend or distribution or the proposed effective date of a
subdivision, combination, reclassification, consolidation, merger, transfer,
lease, liquidation or dissolution. The Company shall mail the notice at least
fifteen (15) days before such date. Failure to mail the notice or any defect in
it shall not affect the validity of the transaction.

                  (g)      Reorganization of Company.

         In case of any consolidation of the Company with or merger of the
Company into another entity, the Company or such successor entity shall execute
and deliver to the Holder an agreement that the Holder shall have the right
thereafter, and until the Expiration Date, upon payment of the applicable
Exercise Price in effect immediately prior to such action (after giving effect
to any applicable adjustments under subsections (a) and (b) of this Section 6)
to purchase upon exercise of the Warrant the kind and amount of shares and other
securities and property (including cash) that such Holder would have owned or
have been entitled to receive after the happening of such consolidation or
merger had such Warrant been exercised immediately prior to such action. The
Company shall at its sole expense mail by first class mail, postage prepaid, to
the Holder notice of the execution of any such agreement. Such agreement shall
provide for adjustments, which shall be substantially identical to the
adjustments provided for in this Section 6. In addition, the Company shall not
merge or consolidate with or into, any other entity unless the successor entity
(if not the Company), shall expressly assume, by supplemental Warrant Agreement
reasonably satisfactory in form and substance to the Holder in its sole judgment
and executed and delivered to the Holder, the due and punctual performance and
observance of each and every covenant and condition of this Agreement to be
performed and observed by the Company. The provisions of this subsection (g)
shall similarly apply to successive consolidations or mergers. Any transfer,
sale or lease of all or substantially all of the
<PAGE>
assets of the Company for a consideration consisting primarily of equity
securities shall be deemed a consolidation or merger for the foregoing purposes.

         If the issuer of securities deliverable upon exercise of the Warrant
under the supplemental Warrant Agreement is an affiliate of the formed,
surviving, transferee or lessee entity, that issuer shall join in the
supplemental Warrant Agreement.

         If this subsection (g) applies, subsections (a) and (b) of this Section
6 do not apply.

                  (h)      Company Determination Final.

         Any determination that the Company or the Board must make pursuant to
subsection (a), (b), (c) or (e) of this Section 6 is conclusive if made
reasonably and in good faith.

                  (i)      Adjustment in Number of Shares.

         Upon each adjustment of the Exercise Price pursuant to this Section 6,
the Warrant outstanding prior to the making of the adjustment in the Exercise
Price shall thereafter evidence the right to receive upon payment of the
adjusted Exercise Price that number of shares of Common Stock (calculated to the
nearest hundredth) obtained from the following formula:

                          E
                  N'=Nx -----
                          E'

where:
                  N'=      the adjusted number of Warrant Shares issuable upon
                           exercise of the Warrant by payment of the adjusted
                           Exercise Price.

                  N =      the number of Warrant Shares previously issuable
                           upon exercise of the Warrant by payment of the
                           Exercise Price prior to adjustment.

                  E' =     the adjusted Exercise Price.

                  E =      the Exercise Price prior to adjustment.

SECTION 7. FRACTIONAL INTERESTS. No fractional shares may be issued upon any
exercise of the Warrant, and any fractions shall be rounded down to the nearest
whole number of shares. If upon any exercise of the Warrant, a fraction of a
share results, the Company will pay the cash value of any such fractional
shares, calculated on the basis of the Exercise Price.

SECTION 8. REDEMPTION OF WARRANTS. The Company shall be under no obligation
under this Agreement to redeem the Warrants, and the Warrants shall not be
redeemable at the Company's option.

SECTION 9. NOTICES TO WARRANT HOLDER. Upon any adjustment of the Exercise Price
pursuant to Section 6 hereof, the Company shall promptly thereafter give to the
Holder written notice of such adjustment(s). The notice shall set forth the
Exercise Price after such adjustment and a brief statement of the facts
requiring such adjustment and setting forth in
<PAGE>
reasonable detail the method of calculation and the number of Warrant Shares (or
portion thereof) issuable after such adjustment in the Exercise Price, upon
exercise of the Warrant and payment of the adjusted Exercise Price.

SECTION 10. REPRESENTATION, WARRANTIES AND CERTAIN AGREEMENTS OF HOLDER. The
            Holder hereby represents and warrants to the Company that:

         10.1 AUTHORIZATION. This Agreement constitutes the Holder's valid and
legally binding obligation, enforceable in accordance with its terms except as
may be limited by (i) applicable bankruptcy, insolvency, reorganization or other
laws of general application relating to or affecting the enforcement of
creditors' rights generally and (ii) the effect of rules of law governing the
availability of equitable remedies. The Holder represents that such Holder has
full power and authority to enter into this Agreement.

10.2 PURCHASE OF OWN ACCOUNT. The Warrant and the Warrant Shares (collectively,
the "SECURITIES") will be acquired for investment for such Holder's own account,
not as a nominee or agent, and not with a view to the public resale or
distribution thereof within the meaning of the Securities Act of 1933, as
amended (the "1933 ACT"), and such Holder has no present intention of selling,
granting any participation in, or otherwise distributing the same.

         10.3 DISCLOSURE OF INFORMATION. Such Holder has received or has had
full access to all the information it considers necessary or appropriate to make
an informed investment decision with respect to the Securities. Such Holder
further has had an opportunity to ask questions and receive answers from the
Company regarding the terms and conditions of the offering of the Securities and
to obtain additional information (to the extent the Company possessed such
information or could acquire it without unreasonable effort or expense)
necessary to verify any information furnished to such Holder or to which such
Holder had access.

         10.4 INVESTMENT EXPERIENCE. Such Holder understands that the purchase
of the Securities involves substantial risk. Such Holder (i) has experience as
an investor in securities and acknowledges that such Holder is able to fend for
itself, can bear the economic risk of such Holder's investment in the Securities
and has such knowledge and experience in financial or business matters that such
Holder is capable of evaluating the merits and risks of this investment in the
Securities and protecting its own interest in connection with this investment
and/or (ii) has a preexisting personal or business relationship with the Company
and certain of its officers, directors or controlling persons of a nature and
duration that enables such Holder to be aware of the character, business acumen
and financial circumstances of such persons.

         10.5 ACCREDITED INVESTOR STATUS. Such Holder is an "accredited
investor" within the meaning of Regulation D promulgated under the 1933 Act.

         10.6 RESTRICTED SECURITIES. Such Holder understands that the Securities
are characterized as "restricted securities" under the 1933 Act and Rule 144
promulgated thereunder in as much as they are being acquired from the Company in
a transaction not involving a public offering, and that under the 1933 Act and
applicable regulations thereunder such securities may be resold without
registration under the 1933 Act only in certain limited circumstances. In this
<PAGE>
connection, such Holder is familiar with Rule 144, as presently in effect, and
understands the resale limitations imposed thereby and by the 1933 Act. Such
Holder understands that no public market now exists for any of the Securities
and that it is uncertain whether a public market will ever exist for the
Securities.

         10.7 NO SOLICITATION. At no time was the Holder presented with or
solicited by any publicly issued or circulated newspaper, mail, radio,
television or other form of general advertising or solicitation in connection
with the offer, sale and purchase of the Securities.

         10.8 MARKET STANDOFF. The Holder agrees in connection with any
registration of the Company's securities under the 1933 Act that, upon the
request of the Company or the underwriters managing any registered public
offering of the Company's securities, Holder will not sell or otherwise dispose
of any Warrant Shares or any other securities of the Company without the prior
written consent of the Company or such managing underwriters, as the case may
be, for a period of time (not to exceed one hundred eighty (180) days) after the
effective date of such registration requested by such managing underwriters
subject to all restrictions as the Company or the managing underwriters may
specify generally. Holder further agrees to enter into any agreement reasonably
required by the underwriters to implement the foregoing; provided that,
notwithstanding a request by the Company, Holder shall not be restricted under
this Section from selling or otherwise transferring or disposing of any Warrant
Shares or other shares of stock of the Company at any time prior to the
effective date of any registration statement.

         In order to enforce the foregoing covenant, the Company shall have the
right to place restrictive legends on the certificates representing the Warrant
Shares subject to this Section and to impose stop transfer instructions.

         10.9 LEGENDS. Holder acknowledges that neither the Warrant nor the
Warrant Shares have been qualified or registered under the 1933 Act or any state
securities laws, and therefore may not be sold or disposed of in the absence of
such registration or qualification only pursuant to an exemption from such
registration or qualification and in accordance with this Agreement. The Warrant
and/or the stock certificate(s) representing the Warrant Shares will bear
legends substantially similar to those set forth below in addition to any other
legend that may be required by applicable law or by any agreement between the
Company and the Holder:

         THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
         SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE SECURITIES
         LAWS OF APPLICABLE STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS
         ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
         EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES
         LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. HOLDER SHOULD BE
         AWARE THAT IT MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS
         INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE
         SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
         SATISFACTORY TO THE ISSUER
<PAGE>
         TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE
         WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

         10.10 TRANSFER RESTRICTIONS. Holder agrees not to sell, transfer or
otherwise dispose of the Warrant or Warrant Shares, in whole or in part, unless:

                  (a) a registration statement under the 1933 Act is in effect
with regard thereto; or

                  (b) such holder has notified the Company of the proposed
disposition and has furnished the Company with an opinion of counsel, reasonably
satisfactory to the Company, that such disposition will not require registration
of such securities under the 1933 Act.

         Notwithstanding the provisions of Section 10.10(a) and 10.10(b) above,
no such registration statement or opinion of counsel shall be required for any
transfer of the Warrant or the Warrant Shares in compliance with Rule 144
promulgated under the 1933 Act.

         In addition, the Warrant Shares, upon issuance by the Company, shall be
subject to the terms and conditions of the Shareholders' Agreement (the
"SHAREHOLDERS' AGREEMENT") dated as of November 7, 2002, by and among General
Media International, Inc., PH Capital Holdings, LLC and the Holder. The Holder
agrees not to transfer the Warrants to any person or entity (i) unless and until
such transferee shall furnish the Company with written agreements, documents
and/or opinions, in form and substance reasonably acceptable to the Company and
its counsel, to be bound by and comply with all provisions of the Shareholders'
Agreement and (ii) other than in accordance with the Shareholders' Agreement.

         10.11 TRANSFER - GENERAL. Subject to the terms hereof, the Warrant
shall be transferable only on the books of the Company maintained at its
principal office upon delivery thereof duly endorsed by the Holder or by its
duly authorized attorney or representative, or accompanied by proper evidence of
succession, assignment or authority to transfer. In all cases of transfer, the
original power of attorney, duly approved, or a copy thereof, duly certified,
shall be deposited and remain with the Company. In case of transfer by
executors, administrators, guardians or other legal representatives, duly
authenticated evidence of their authority shall be produced, and may be required
to be deposited and to remain with the Company in its discretion. Upon any
registration of transfer, the person to whom such transfer is made shall receive
a new Warrant or Warrants as to the portion of the Warrant transferred, and the
Holder shall be entitled to receive a new Warrant or Warrants from the Company
as to the portion thereof retained. The designated transferee or transferees
will be recorded in the register maintained by the Company as the Holder(s) of
the new Warrant(s).

SECTION 11. NO RIGHTS AS STOCKHOLDER; NOTICES TO HOLDER. Nothing contained in
this Agreement or in the Warrant shall be construed as conferring upon the
Holder or its permitted transferees the right to vote or to receive dividends or
to consent to or receive notice as a stockholder in respect of any meeting of
stockholders for the election of directors of the Company or any other matter,
or any rights whatsoever as a stockholder of the Company;
<PAGE>
provided that this provision shall not limit the required notice as set forth in
Section 9 hereof.

SECTION 12. NOTICES. Any notices, requests and demands by the Holder to the
Company pursuant to this Agreement to be effective shall be in writing
(including by facsimile), and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made when delivered by hand, or three (3)
days after being deposited in the mail, postage prepaid, or, in the case of a
facsimile notice, when received, or, in the case of delivery by a nationally
recognized overnight courier, when received, addressed:

         If to the Company, to:

                                    American Pulp Exchange, Inc.
                                    11 Penn Plaza
                                    12th Floor
                                    New York, New York  10001
                                    Attention: President
                                    Fax:    (212) 702-6248

         With a copy to:

                                    Pachulski, Stang, Ziehl, Young & Jones P.C.
                                    461 Fifth Avenue
                                    25th Floor
                                    Attention:  Robert Feinstein, Esq.
                                    Fax:  (212) 561-7777

         Any notices, requests and demands by the Company to the Holder pursuant
to this Agreement to be effective shall be in writing (including by facsimile),
and, unless otherwise expressly provided herein, shall be deemed to have been
duly given or made when delivered by hand, or three (3) days after being
deposited in the mail, postage prepaid, or, in the case of a facsimile notice,
when received, or, in the case of delivery by a nationally recognized overnight
courier, when received, addressed to the Holder at its address as shown in the
stock record books of the Company. Each party hereto may from time to time
change the address to which notices to it are to be delivered or mailed
hereunder by notice in writing to the other party.

SECTION 13. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, without giving effect to
principles of conflict of laws thereof. The parties hereto agree to submit to
the jurisdiction of the courts of the State of New York in any action or
proceeding arising out of or relating to this Agreement. Venue for any such
actions shall be in the state or federal courts of New York, New York. In the
event of litigation, the prevailing party shall be entitled to reasonable
attorneys' fees and costs.

SECTION 14. SUCCESSORS. All the covenants and provisions of this Agreement by or
for the benefit of the Company shall bind and inure to the benefit of the
successors and assigns of the parties hereto.

SECTION 15. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to confer upon any person other than the Company and the Holder (and
their
<PAGE>
respective successors and assigns) any legal or equitable right, remedy or claim
under this Agreement and this Agreement shall be for the sole and exclusive
benefit of the Company and the Holder, and their respective assignees.

SECTION 16. CAPTIONS. The captions of the Sections of this Agreement have been
inserted for convenience only and shall have no substantive effect.

SECTION 17. COUNTERPARTS. This Agreement may be executed in any number of
counterparts each of which when so executed shall be deemed to be an original;
but such counterparts together shall constitute but one and the same instrument.

SECTION 18. AMENDMENT, WAIVER AND COURSE OF DEALING. No course of dealing or any
delay or failure to exercise any right hereunder on the part of any party
thereto shall operate as a waiver of such right or otherwise prejudice the
rights, powers or remedies of such party. This Agreement, the Warrant and any
term hereof and thereof, respectively, may be amended, waived or terminated only
by an instrument in writing signed by the party against which enforcement of
such change, waiver or termination is sought.

SECTION 19. FURTHER ASSURANCES. From and after the date of this Agreement, the
Company and the Holder shall execute and deliver such instruments, documents or
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.

SECTION 20. ENTIRE AGREEMENT. This Agreement and the documents referred to
herein constitute the entire agreement among the parties with respect to the
subject matter hereof and thereof and supersede all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof and thereof.
<PAGE>
         IN WITNESS WHEREOF, the Company and the Holder have caused this
Agreement to be duly executed as of the date first above written.

HOLDER:                                         THE COMPANY:

VECTOR PARTNERS, LLC,                            AMERICAN PULP EXCHANGE, INC.,
a Nevada limited liability company               a Florida corporation

By:      s/s Jason Galanis                       By:  R. Guccione
     -----------------------------                  ---------------------------

Name: Jason Galanis                              Name: Robert C. Guccione

Title:   Managing Member                         Title:   Chairman and President

                      [SIGNATURE PAGE TO WARRANT AGREEMENT]
<PAGE>
                                    EXHIBIT A

THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR
UNDER THE SECURITIES LAWS OF APPLICABLE STATES. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. HOLDER SHOULD BE AWARE THAT
THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN
INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION
OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT
ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE
STATE SECURITIES LAWS.

Warrant No. ____________                                        575,000 Shares

                        WARRANT TO PURCHASE COMMON STOCK

                              Void After 5:00 P.M.

                       Pacific Time on [January ___, 2008]

         THIS CERTIFIES THAT, for value received, ________________, or
registered assigns (the "HOLDER"), is the registered holder of this Warrant to
Purchase Common Stock (the "WARRANT") and is entitled to purchase from American
Pulp Exchange, Inc., a Florida corporation (the "COMPANY"), subject to the terms
and conditions of the Warrant Agreement dated as of November __, 2002, by and
between the Company and the Holder (the "WARRANT AGREEMENT"), at any time until
5:00 p.m., Pacific Time, on [January __, 2008] (the "EXPIRATION DATE"), Five
Hundred Seventy-Five Thousand (575,000) shares of the common stock of the
Company (the "COMMON STOCK") at a price of $0.01 per share (the "EXERCISE
PRICE"). The number of shares purchasable upon exercise of this Warrant and the
Exercise Price per share shall be subject to adjustment from time to time as set
forth in the Warrant Agreement.

         This Warrant is issued under and in accordance with the Warrant
Agreement and is subject to the terms and provisions contained in the Warrant
Agreement, all of which are incorporated herein by reference. All capitalized
terms used and not otherwise defined herein shall have the meanings given them
in the Warrant Agreement.

         This Warrant may be exercised in whole or in part by presentation of
this Warrant with the Subscription Form, the form of which is attached hereto,
duly executed and simultaneous payment of the Exercise Price (subject to
adjustment) at the principal office of the Company. Payment of such price shall
be payable at the option of the Holder hereof in cash made by wire transfer, by
check or by exercise of the Holder's Net Exercise Right as set forth in the
Warrant Agreement.
<PAGE>
         Upon partial exercise, a Warrant for the unexercised portion shall be
delivered to the Holder. No fractional shares will be issued upon the exercise
of this Warrant, but the Company shall pay the cash value of any fraction upon
the exercise of the Warrant.

         This Warrant does not entitle the Holder hereof to any of the rights as
a stockholder of the Company until such time as this Warrant is exercised in
accordance with the Warrant Agreement.

                                               AMERICAN PULP EXCHANGE, INC.,

                                               a Florida corporation

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

AGREED AND ACKNOWLEDGED:

VECTOR PARTNERS, LLC,
a Nevada limited liability company

By:
    -------------------------------------
Name:
    -------------------------------------
Title:
    -------------------------------------
<PAGE>
                                    EXHIBIT B

                                SUBSCRIPTION FORM

[INSERT DATE]

To:               AMERICAN PULP EXCHANGE, INC.

Attention:        President

         [ ] The undersigned hereby elects to exercise the Warrant issued to it
by American Pulp Exchange, Inc., a Florida corporation (the "COMPANY"), pursuant
to the Warrant Agreement dated November ____, 2002 (the "WARRANT AGREEMENT"), by
and between the Company and Vector Partners, LLC, a Nevada limited liability
company, and to purchase thereunder ______________ (____________) shares of
Common Stock of the Company (the "SHARES") at a purchase price of
_______________ Dollars ($_______) per share or an aggregate purchase price of
_______________ Dollars ($_______) (the "PURCHASE PRICE").

         [ ] The undersigned hereby elects under the provision set forth in
Section 2.4 of the Warrant Agreement to make a net exercise of the Warrant as to
__________ shares.

         In exercising the Warrant, the undersigned hereby confirms and
acknowledges that the representations and warranties set forth in Section 10 of
the Warrant Agreement as they apply to the undersigned continue to be true and
correct as of this date.

         Please issue a certificate representing such Shares in the name
specified below.

_____________________________________
(Name)

_____________________________________
(Address)

_____________________________________
(City, State, Zip Code)

_____________________________________       ___________________________________
(Date)                                      (Signature of Holder)

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