Document:

[FORM OF STOCK CERTIFICATE]

                                                    (SEE LEGEND ON REVERSE SIDE)

                NOT VALID UNLESS COUNTERSIGNED BY TRANSFER AGENT
              INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

        NUMBER                     AUTO DATA                       SHARES
        ------                    NETWORK, INC.                    ------
                           SERIES B CONVERTIBLE STOCK
                                PAR VALUE: $.001

THIS CERTIFIES THAT

IS THE RECORD HOLDER OF

   - Shares of AUTO DATA NETWORK, INC. Series B Convertible Preferred Stock -
transferable on the books of the Corporation in person or by duly authorized
attorney upon surrender of this Certificate properly endorsed. This Certificate
is not valid until countersigned by the Transfer Agent and registered by the
Registrar.

         Witness the facsimile seal of the Corporation and the facsimile
                  signatures of its duly authorized officers.

Dated:  3/12/04

                                     [SEAL]

                             Auto Data Network, Inc.
                                    Corporate
                                      Seal
                                    Delaware
                                      *****

/s/ Illegible                                        /s/ Illegible
---------------------------                          ---------------------------
Secretary                                            President

                           Countersigned & Registered
                              LIBERTY TRANSFER CO.
                       Box 558, Huntington, NY 11743-0558

                     By: /s/ Illegible
                         ------------------------------
                         Authorized Signature

<PAGE>

NOTICE:     Signature  must be  guaranteed  by a firm  which  is a  member  of a
            registered  national  stock  exchange,  or by a bank  (other  than a
            savings bank), or trust company. The following  abbreviations,  when
            used in the  inscription on the face of this  certificate,  shall be
            construed  as though  they were  written  out in full  according  to
            applicable laws or regulations.

TEN COM -- as tenants in common                  UNIF GIFT MIN ACT -- Custodian
TEN ENT -- as tenants by the entireties              (Cust)            (Minor)
JT TEN - as joint tenants with right of            under Uniform Gifts to Minors
survivorship and not as tenants in common          Act..........................
                                                             (State)

    Additional abbreviations may also be used though not in the above list.

For Value Received,________ hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER
  IDENTIFYING NUMBER OF ASSIGNEE
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 (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OR ASSIGNEE)

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------------------------------------------------------------------------- Shares
of the capital stock represented by the within certificate, and do hereby
irrevocably constitute and appoint

----------------------------------------------------------------------- Attorney
to transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.

Dated ____________________________

        -----------------------------------------------------------------------
        NOTICE:         THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH
                        THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN
                        EVERY PARTICULAR WITHOUT ALTERATION OF ENLARGEMENT OR
                        ANY CHANGE WHATEVER.

                        CURRENT TRANSFER FEE APPLICABLE

"The shares  represented by this  certificate have not been registered under the
Securities Act of 1933, as amended  ):Act").  Such shares have been acquired for
investment  and may not be  publicly  offered  or sold in the  absence of (1) an
effective  registration  statement for such shares under it Act; (2) opinions of
counsel  to the  Company  prior to any  proposed  transfer  to the  effect  that
registration  is not  required  under the Act; or (3) a letter  presented to the
Company,  prior to any proposed  transfer,  from the staff of the Securities and
Exchange Commission,  to the effect that it will not take any enforcement action
if the proposed transfer is made without registration under the Act"EXHIBIT 10.22

                          SECURITIES PURCHASE AGREEMENT

      Securities  Purchase  Agreement  (together with the schedules and exhibits
hereto,  this  "Agreement"),  dated as of February 12, 2004, by and between Auto
Data Network,  Inc., a Delaware  corporation  (the  "Company"),  and each of the
Persons (as defined  below) who has executed a signature  page to this Agreement
(each a "Purchaser," and together, the "Purchasers").

                              W I T N E S S E T H:

      WHEREAS, the Company desires to issue and sell to the Purchasers,  and the
Purchasers desire to purchase from the Company,  the Securities (as such term is
defined below) as set forth below.

      NOW, THEREFORE,  in consideration of the foregoing premises and the mutual
covenants and agreements hereinafter contained,  and for other good and valuable
consideration,  the receipt and  sufficiency  of which are hereby  acknowledged,
intending to be legally bound, the parties hereto hereby agree as follows:

      1. Offer and Sale of Securities.

      1.1 The Offering.  The Company is offering for sale a minimum of 2,105,263
shares (the "Minimum  Offering") and a maximum of 3,947,368 shares (the "Maximum
Offering")  of its Series B  Preferred  Stock,  par value  $0.001 per share (the
"Series B Preferred Stock").  In addition,  the Maximum Offering maybe increased
by up to an additional Ten Per Cent (10%) (that is, to an aggregate of 4,342,105
shares of Series B Preferred  Stock) by the  Company.  Furthermore,  in order to
satisfy  the  preemptive  rights of the  holders  of the  Company's  Series  A-1
Preferred  Stock and Series A-2  Preferred  Stock,  the Maximum  Offering may be
increased to up to 5,514,474 shares of Series B Preferred Stock; provided,  that
whatever  number of shares of Series B  Preferred  Stock in excess of  4,342,105
shares is not  utilized to satisfy the  preemptive  rights of the holders of the
Company's  Series A-1 Preferred  Stock and Series A-2 Preferred Stock in respect
of the issuance of the Series B Preferred Stock shall be cancelled,  retired and
eliminated  by the  Company  from the  shares of Series B  Preferred  Stock,  as
applicable,  which the Company shall be authorized to issue.  Any such shares of
Series B Preferred  Stock so cancelled,  retired and  eliminated  shall have the
status  of  authorized  and  unissued  shares of  Preferred  Stock  issuable  in
undesignated  Series and may be  redesignated  and  reissued in any series other
than as Series B Preferred  Stock.  The shares of Series B Preferred Stock which
may be issued upon  exercise of  preemptive  rights by holders of the  Company's
Series  A-1  Preferred  Stock and  Series  A-2  Preferred  Stock  are  sometimes
hereinafter  referred to as the "Preemptive Rights Shares." Each share of Series
B Preferred  Stock converts to two shares of Common Stock.  For each 5 shares of
Series B Preferred  Stock  Purchased,  investors shall receive 2 warrants in the
form attached hereto as Exhibit D (the "Warrants"),  each to purchase a share of
the Company's  common stock (the "Common  Stock"),  at an initial exercise price
equal to $2.50 per share.  Warrants  will expire five years from the issue date.
Warrants  also shall  expire,  to the extent not  previously  exercised,  if the
closing price of the Company's Common Stock is at or above Four Hundred Per Cent
(400%) of the  exercise  price for 30  consecutive  trading  days.  The Series B
Preferred   Stock   have  the   powers,   designations,   preferences,   rights,
qualifications,  limitations  and  restrictions  contained in the Certificate of
Designations  of the Series B Preferred  Stock,  in the form of Exhibit A hereto
(the  "Certificate  of  Designations").  The  Series B  Preferred  Stock and the
Warrants  offered  hereby,  and the  underlying  shares  of  Common  Stock,  are
sometimes  referred to herein as the  "Securities".  The shares of Common  Stock
issuable  upon  conversion  of the  shares of the Series B  Preferred  Stock are
sometimes  hereinafter referred to herein as the "Conversion Shares". The shares
of Common Stock issuable upon exercise of the Warrants are sometimes hereinafter
referred  to herein as the  "Warrant  Shares".  The  Purchasers  of the Series B
Preferred Stock shall have the benefit of certain registration rights in respect
of the  shares  of  Common  Stock  underlying  the  Securities  on the terms and
conditions of a Registration  Rights Agreement,  in the form of Exhibit B hereto
(the "Registration  Rights Agreement").  The Company is offering shares of the B
Preferred Stock and the Warrants (the  "Offering") for sale only to individuals,
entities  or  groups,  including,  without  limitation,   corporations,  limited
liability   companies,   limited  or  general   partnerships,   joint  ventures,
associations,  joint stock companies, trusts, unincorporated  organizations,  or
governments or any agencies or political subdivisions thereof (each, a "Person")
who are "accredited  investors" (as defined  herein).  The Company is making the

<PAGE>

Offering of the  Securities  directly  through  certain of its  officers and its
directors,  but may engage a placement agent (the "Placement Agent"),  and other
registered   broker-dealers   ("Other  Participating  Agents")  may  also  place
Securities.  In  connection  with  the  Offering,  the  Company  will pay to the
Placement Agent and to Other Participating  Agents, if any, commissions equal to
10% of the  gross  sales  price of the  Series  B  Preferred  Stock  sold in the
offering by the applicable  Placement  Agent or Other  Participating  Agent.  In
addition,  the Company will issue to the Placement Agent and Other Participating
Agents,  if any, at the final Closing  warrants (the "Placement Agent Warrants")
granting to the  Placement  Agent and Other  Participating  Agents,  if any, the
right to  purchase,  for the  exercise  price  below,  a number of shares of the
Company's  common  stock  equal  to the  commissions  paid to that  party in the
offering  divided by 1.90.  Those warrants shall be exercisable at  $1.90/share,
subject  to  adjustment,  commencing  one year  after the date of  issuance  and
continuing for five (5) years thereafter,  and shall contain a cashless exercise
provision.  If the Company designates a managing Placement Agent, that person or
entity may also receive  additional  compensation of up to 2% of the gross sales
price of the Series B Preferred  Stock sold in the  offering by other  placement
agents  participating  in the offering  and a  corresponding  percentage  of the
Placement Agent Warrants issued to any other  placement agent  participating  in
the Offering.  All subscription proceeds in the Offering will be paid at Closing
to the account or accounts specified in Section 1.2 herein, provided that in the
event that a Placement  Agent is  utilized,  the Company  will utilize an escrow
agent  (the  "Escrow  Agent")  for  receipt  of funds.  All  references  in this
Agreement to the Escrow Agent shall be deemed to be references to the Company in
the event that there is no third party Escrow Agent.

      1.2 Subscription.

      Subject  to the  terms  and  conditions  hereinafter  set  forth  in  this
Agreement,  each  Purchaser  hereby offers to purchase,  at a price of $3.80 per
share,  the number of shares of Series B Preferred  Stock set forth beneath each
such Purchaser's name on the signature pages of this Agreement, for an aggregate
purchase price (the "Purchase Price") to be paid by such Purchaser in the amount
set forth on the signature page beneath such  Purchaser's  name, to such account
or accounts as the Company may specify by written notice to the Purchaser.

      1.3 Subscription Procedures.  To submit this Subscription,  each Purchaser
must deliver (i) this  Agreement,  including,  without  limitation,  the annexed
Purchaser  Questionnaire,  both duly completed and executed and (ii) an executed
Registration Rights Agreement to the following address, unless otherwise advised
by the Company:

         Auto Data Network, Inc.
         712 Fifth Avenue
         19th Floor
         New York, NY, 10019

         Attention:  Christopher Glover

      (with  any  questions  to be  raised  with  Christopher  Glover  at  (212)
561-1837)

                                       2
<PAGE>

      The Company may accept or reject  subscriptions,  in whole or in part,  or
accept subscriptions for less than the $57,000 minimum subscription, in its sole
discretion.  The Company shall notify each Purchaser of the portion,  if any, of
such Purchaser's subscription which has been accepted,  payment instructions for
the purchase price,  including wire transfer  instructions  and instructions for
delivery  of  payment  by  checks,  if  applicable,  and the date upon which the
applicable  Closing shall be held and payment must be made.  At each  applicable
Closing,  each Purchaser acquiring  Securities at such Closing shall deliver and
pay the applicable  purchase price in full for the Securities being purchased by
such Purchaser at such Closing,  in the amount of $3.80 for each share of Series
B Preferred Stock for which such Purchaser's  subscription has been accepted, in
U.S.  dollars,  in immediately  available  funds, in accordance with the payment
instructions contained in the notification to such Purchaser by the Company.

      2. Closing.

      Upon acceptance of subscriptions for Series B Preferred Stock totaling, at
least  $8,000,000  (the  "Initial  Minimum  Offering"),  the  Company may hold a
closing of the purchase and sale of such Securities (the "Initial Closing"). The
Company may  thereafter  hold one or more  additional  closings  (each  closing,
including  the Initial  Closing,  a "Closing,"  and the final closing the "Final
Closing") upon the purchase and sale of additional Securities until an aggregate
amount of up to $15,000,000 (the "Maximum Offering") of Series B Preferred Stock
has been sold by the Company;  provided,  that the Company, at its election, may
increase the Maximum  Offering by up to Ten Per Cent (10%);  provided,  further,
that in order to satisfy the  preemptive  rights of the holders of the Company's
Series A-1 Preferred Stock and Series A-2 Preferred  Stock, the Maximum Offering
may be  increased to up to 5,514,474  shares of Series B Preferred  Stock.  Each
Closing shall be held at such location as the Company may  determine.  The Final
Closing will take place not later than  February  20, 2004,  unless the offering
which is the  subject of this  Agreement  is  extended  by the Company for up to
twenty  (20)  additional  days,  which the  Company  may elect to do in its sole
discretion  without  notice to investors.  Notwithstanding  the  foregoing,  the
Company intends to continue the offering period thereafter for up to 35 days for
the sole purpose of permitting the exercise of preemptive  rights by the holders
of the  Series  A-1 and  Series A-2  Preferred  Stock.  The date of the  Initial
Closing  will be referred to as the "Initial  Closing  Date" and the date of the
Final  Closing is referred to as the "Final  Closing  Date." At the Closing with
respect  to the  subscription  by each  Purchaser,  to the  extent  the  same is
accepted  by the  Company,  the Company  will  register in the name of each such
Purchaser  that  number of  Securities  being  purchased  by such  Purchaser  in
accordance  with  the  information  on the  applicable  signature  page  of this
Agreement.

      2.1 Escrow.  In the event that the Company  engages a Placement  Agent for
this Offering,  pending each Closing all funds paid in respect of this Agreement
with regard to such Closing shall be deposited in an escrow account (the "Escrow
Account")  maintained by the Escrow Agent in  accordance  with Rule 15c2-4 under
the Exchange Act (as defined  herein).  The Escrow Account shall not be interest
bearing. If the Company accepts  subscriptions for the Securities at or prior to
the Initial Closing Date or the Final Closing Date, as the case may be, then all
subscription  proceeds received for subscriptions  accepted by the Company prior
to such Closing Date shall be paid over to the Company at each  Closing,  net of
the Placement  Agent fees, if any, and other offering  expenses,  which shall be
paid to the appropriate  parties at each such Closing.  If the Company shall not
have received and accepted each Purchaser's subscription, then that subscription
shall be void and all funds paid hereunder by such Purchaser,  without deduction
therefrom or interest thereon, shall be promptly returned to such Purchaser.

      2.2.  Return of Funds.  Each Purchaser  hereby  authorizes and directs the
Escrow  Agent to return  or direct  the  return  of any  funds  from the  Escrow
Account,  without deduction  therefrom or interest thereon,  to the same account
from which the funds were originally  drawn, to the extent that such Purchaser's
subscription is not accepted prior to the termination of the Offering.

                                       3
<PAGE>

      3. Conditions to the Obligations of each Purchaser at Closing.

      The  obligation of each  Purchaser to purchase and pay for the  Securities
subscribed  for by such  Purchaser at the  applicable  Closing is subject to the
satisfaction  on or prior to the Initial Closing Date or the Final Closing Date,
as the case may be, of the following conditions,  each of which may be waived by
the applicable Purchaser:

      3.1  Opinion of Counsel to the  Company.  The  Placement  Agent shall have
received from counsel for the Company,  its opinion  dated as of the  applicable
Closing Date, and addressed to the applicable  Purchasers  purchasing securities
on such Closing Date), covering the matters attached hereto as Exhibit C.

      3.2 Representations and Warranties.  The representations and warranties of
the Company contained in this Agreement must be true and correct in all material
respects  as of the Closing  Date except to the extent that the  representations
and warranties relate to an earlier date in which case the  representations  and
warranties must be true and correct as of the earlier date.

      3.3 Performance of Covenants. The Company shall have performed or complied
with in all  material  respects  all  covenants  and  agreements  required to be
performed  by it on  or  prior  to  the  applicable  Closing  pursuant  to  this
Agreement,   including,   without  limitation,   the  delivery  of  certificates
evidencing the Securities issued to the Purchasers at the Closing.

      3.4 No  Injunctions;  etc. No court or governmental  injunction,  order or
decree  prohibiting  the purchase and sale of the Securities  will be in effect.
There  will  not be in  effect  any  law,  rule  or  regulation  prohibiting  or
restricting the sale or requiring any consent or approval of any Person that has
not been obtained to issue and sell the Securities to the Purchasers.

      3.5 Closing Documents.  At each Closing,  the Company shall have delivered
to each applicable Purchaser the following:

      (a) a  certificate  of the  President of the Company  certifying  that the
conditions in Sections 3.2 and 3.3 have been satisfied;

      (b) A  certificate  of the  Secretary  of the  Company,  dated  as of that
Closing  Date,  certifying  (i)  the  attached  copies  of  the  Certificate  of
Incorporation  and By-laws of the Company,  (ii) the resolutions of the Board of
Directors of the Company (the "Board")  authorizing the execution,  delivery and
performance of this Agreement and the issuance of the Securities (including, but
not limited to, for purposes of Section 203 of the Delaware General  Corporation
Law) and (iii) the  incumbency of the officers  duly  authorized to execute this
Agreement and the other documents contemplated by this Agreement;

      (c) a  certificate  of the  Secretary  of State of the State of  Delaware,
dated as of a recent  date (but no more than five  business  days)  prior to the
date of the  applicable  Closing,  to the  effect  that the  Company  is in good
standing in the State of Delaware and that all annual reports, if any, have been
filed as  required  and that all taxes  and fees  have  been paid in  connection
therewith;

      (d) a copy of the Certificate of  Designations  certified by the Secretary
of State of the State of Delaware;

      (e) a certificate  evidencing the Securities  purchased by such Purchaser;
and

                                       4
<PAGE>

      (f) a Registration Rights Agreement duly executed by the Company.

      3.6 Waivers and Consents.  The Company will have obtained all consents and
waivers  necessary  to  execute  and  deliver  this  Agreement  and all  related
documents  and  agreements  and to issue and  deliver  the  Securities,  and all
consents and waivers will be in full force and effect.

      4. Conditions to the Obligations of the Company at Closing.

      The  obligation  of the  Company to issue and sell the  Securities  to any
Purchaser is subject to the satisfaction on or prior to each Closing Date of the
following conditions, each of which may be waived by the Company:

      4.1 Receipt of Purchase Price.  The Company shall have received payment in
full in immediately  available  funds in U.S.  dollars of the Purchase Price for
the Securities  with respect to which the Company has accepted the  Subscription
made by such Purchaser by means of this Agreement.

      4.2 Representations and Warranties.  The representations and warranties of
the  Purchaser  contained  in this  Agreement  must be true and  correct  in all
respects as of the applicable Closing Date.

      4.3  Performance  of  Covenants.  The  Purchasers  will have  performed or
complied with in all material respects all covenants and agreements  required to
be  performed  by the  Purchasers  on or prior to the  Closing  pursuant to this
Agreement.

      4.4  Purchaser  Questionnaire.  All of the  information  furnished by such
Purchaser  in  the  confidential  purchaser   questionnaire   accompanying  this
Agreement (the "Purchaser  Questionnaire") shall have been accurate and complete
in all material respects.

      4.5 No Injunctions.  No court or governmental injunction,  order or decree
prohibiting the purchase or sale of the Securities will be in effect.

      4.6 Closing Document.  The Purchasers will have delivered to the Company a
Registration Rights Agreement duly executed by the Purchasers.

      4.7 Receipt of Minimum  Proceeds of Offering of Series B Preferred  Stock.
The Company shall have received  payment in immediately  available funds in U.S.
dollars of the Purchase Price for at least 2,105,263 shares of the Securities.

      5. Representations and Warranties of each Purchaser.

      Each Purchaser,  in order to induce the Company to perform this Agreement,
hereby represents and warrants, severally and not jointly, as follows:

      5.1 Due Authorization. Each Purchaser represents for such Purchaser to the
Company  that such  Purchaser  has full  power and  authority  and has taken all
action  necessary to authorize  such  Purchaser to execute,  deliver and perform
such Purchaser's obligations under this Agreement.  This Agreement is the legal,
valid and binding obligation of such Purchaser in accordance with its terms.

      5.2 Accredited Investor.  Each Purchaser represents that such Purchaser is
an Accredited Investor as that term is defined in Regulation D promulgated under
the Securities Act of 1933, as amended (the "Securities Act").

                                       5
<PAGE>

      5.3  No   Investment   Advice.   The   Company  has  not  made  any  other
representations  or warranties to such Purchaser  other than as set forth herein
or incorporated  herein by reference with respect to the Company or rendered any
investment advice.

      5.4 Investment  Experience.  Each Purchaser represents that such Purchaser
has  not   authorized   any  Person  to  act  as  such   Purchaser's   Purchaser
Representative (as that term is defined in Regulation D of the General Rules and
Regulations under the Securities Act) in connection with this transaction.  Such
Purchaser  has such  knowledge  and  experience  in  financial,  investment  and
business  matters that such  Purchaser is capable of  evaluating  the merits and
risks of the  prospective  investment  in the  securities  of the Company.  Such
Purchaser has consulted with such independent legal counsel or other advisers as
such Purchaser has deemed appropriate to assist such Purchaser in evaluating the
proposed investment in the Company.

      5.5 Adequate  Means.  Each Purchaser  represents as to such Purchaser that
such Purchaser (i) has adequate means of providing for such Purchaser's  current
financial  needs and  possible  contingencies;  and (ii) can  afford (a) to hold
unregistered  securities for an indefinite  period of time as required;  and (b)
sustain a complete loss of the entire amount of the subscription.

      5.6 Access to Information.  Each Purchaser  represents that such Purchaser
has been afforded the  opportunity to ask questions of, and receive answers from
the officers and/or directors of the Company acting on its behalf concerning the
terms  and  conditions  of  this   transaction  and  to  obtain  any  additional
information,  to the extent that the Company  possesses such  information or can
acquire it  without  unreasonable  effort or  expense,  necessary  to verify the
accuracy  of the  information  furnished;  and has had such  opportunity  to the
extent such Purchaser considers appropriate in order to permit such Purchaser to
evaluate the merits and risks of an investment in the Company.  It is understood
that all documents,  records and books  pertaining to this  investment have been
made  available  for  inspection,  and that the books and records of the Company
will be available  upon  reasonable  notice for  inspection by investors  during
reasonable  business  hours at its  principal  place of business.  The foregoing
shall in no way be deemed to limit the ability of each  Purchaser to rely on the
representations  and  warranties  set  forth  herein or  incorporated  herein by
reference.

      5.7 No Endorsement. Each Purchaser further acknowledges that the offer and
sale of the Securities  has not been passed upon or the merits thereof  endorsed
or approved by any state or federal authorities.

      5.8 Non-Registered Securities.  Each Purchaser acknowledges that the offer
and sale of the Securities have not been registered  under the Securities Act or
any state securities laws and the Securities and the underlying shares of Common
Stock may be resold only if registered pursuant to the provisions  thereunder or
if an exemption from registration is available.  Each Purchaser understands that
the offer and sale of the Securities is intended to be exempt from  registration
under the Securities Act, based, in part, upon the  representations,  warranties
and agreements of such Purchaser contained in this Agreement.

      5.9 No  Resale.  Each  Purchaser  represents  that  the  Securities  being
subscribed  for,  and the  securities  underlying  the  subscription,  are being
acquired  solely  for  the  account  of  such  Purchaser  for  such  Purchaser's
investment  and not  with a view to,  or for  resale  in  connection  with,  any
distribution  in any  jurisdiction  where  such  sale or  distribution  would be
precluded. By such representation, such Purchaser means that no other Person has
a  beneficial  interest  in the  Securities  or the  securities  underlying  the
subscription, and that no other Person has furnished or will furnish directly or
indirectly,   any  part  of  or  guarantee  the  payment  of  any  part  of  the
consideration  to be  paid  by  such  Purchaser  to the  Company  in  connection
therewith.  Such  Purchaser does not intend to dispose of all or any part of the
Securities or the securities  underlying the  subscription  except in compliance
with the provisions of the Securities Act and applicable  state securities laws,
and  understands   that  the  Securities  and  the  securities   underlying  the
subscription  are being  offered  pursuant  to a  specific  exemption  under the
provisions  of the  Securities  Act,  which  exemption(s)  depends,  among other
things, upon the compliance with the provisions of the Securities Act.

                                       6
<PAGE>

      5.10 Legend.  Each  Purchaser  hereby  acknowledges  and agrees that until
either (i) a  registration  statement  covering the resale of the  securities is
effective  under the  Securities Act and such  securities  have been disposed of
thereunder,  (ii) such  Securities  are  disposed  of under  Rule 144 and are no
longer  required to be legended  under Rule 144,  or (iii) such  Securities  are
eligible for sale under Rule 144(k)  promulgated  under the Securities Act, and,
in either  case,  the  holder  properly  requests  that the legend be removed in
accordance therewith,  the Company may insert the following or similar legend on
the  face  of the  certificates  evidencing  the  Securities  purchased  by such
Purchaser and the shares of Common Stock issued upon the  conversion or exercise
thereof,  as the case may be, if required in compliance  with the Securities Act
or state securities laws:

      "These  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 or otherwise transferred or disposed of except pursuant to
      an  effective  registration  statement  under the  Securities  Act and any
      applicable state securities laws, or an opinion of counsel satisfactory to
      counsel  to the  issuer  that an  exemption  from  registration  under the
      Securities Act and any applicable state securities laws is available."

      5.11 Broker's or Finder's Commissions.  Other than the Placement Agent (as
placement agent on behalf of the Company) or any Other  Participating  Agent, if
any, no finder,  broker, agent, financial person or other intermediary has acted
on behalf of any Purchaser in connection  with the sale of the Securities by the
Company  or the  consummation  of  this  Agreement  or  any of the  transactions
contemplated hereby.

      Each Purchaser  certifies that each of the foregoing  representations  and
warranties by such Purchaser set forth in this Section 5 are true as of the date
hereof and shall survive such date.

      6. Representations and Warranties of the Company.

      The Company  represents  and warrants to the  Purchasers  as follows as of
each  applicable  Closing,  each such  representation  and  warranty  being made
subject  to such  disclosures  as are made  pursuant  to this  Agreement  or any
schedule or exhibit delivered in connection  herewith at the applicable Closing,
and the consummation of additional Closings as contemplated by this Agreement:

      6.1  Organization,  Good  Standing  and  Qualification.  The  Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware.  The Company has full corporate power and authority to
own and hold its  properties  and to conduct its  business.  The Company is duly
licensed or qualified to do business, and in good standing, in each jurisdiction
in which the nature of its business  requires  licensing,  qualification or good
standing,  except for any  failure to be so  licensed  or  qualified  or in good
standing  that would not have a material  adverse  effect on the  Company or its
results of operations, assets, business or financial condition or on its ability
to perform its  obligations  under this  Agreement or to issue the Securities (a
"Material Adverse Effect").

      6.2  Capitalization.  As of January 20, 2004, the authorized capital stock
of the Company  consists of  50,000,000  shares of Common  Stock and  25,000,000
shares of Preferred Stock,  par value $0.001 per share (the "Preferred  Stock").
As of January 20, 2004,  (i)  23,248,850  shares of Common Stock were issued and

                                       7
<PAGE>

outstanding,  (ii) no shares of Common Stock were  reserved  for  issuance  upon
exercise of outstanding options issued to certain officers of the Company, (iii)
except as set forth below in respect of certain recent  negotiations,  no shares
of Common Stock were reserved for issuance upon exercise of outstanding  options
issued to persons other than officers of the Company,  (iv) 2,905,100  shares of
Series A-1 Preferred  Stock and Series A-2 Preferred  Stock,  in the  aggregate,
were issued and  outstanding,  and (vi) the Company is offering up to  3,947,368
shares  (up to  4,342,105  shares  if the  Company  exercises  an  overallotment
election) of its Series B Preferred Stock (and up to 5,514,474  shares of Series
B Preferred Stock, in the aggregate,  if the maximum number of Preemptive Rights
Shares which may be issued in connection  with this Offering are included),  and
no  other  shares  of  Preferred  Stock  were  issued  or  outstanding.  All the
outstanding  shares of Common Stock have been duly authorized and validly issued
and are fully paid and nonassessable and free of preemptive rights created by or
through the  Company,  and have been issued in  compliance  with all federal and
state securities laws, and were not issued in violation of any preemptive rights
or similar  rights to  subscribe  for or purchase  securities.  Except set forth
prior to the date hereof in the  Commission  Documents (as defined  below) or in
this  Section  6.2 or in or  pursuant  to this  Agreement,  there  are no  other
options,  warrants  (other than the Placement Agent Warrants being issued to the
placement  agents in connection with the Offering) or other rights,  convertible
debt,  agreements,  arrangements or commitments of any character  obligating the
Company  to  issue or sell  any  shares  of  capital  stock  of or other  equity
interests in the Company.  The Company has an obligation to issue 500,000 shares
as contingent  consideration  for the  acquisition  of County  Services  Limited
within  thirty  (30)  days  of  approval  of  the  Company's  audited  financial
statements for the fiscal year ended  February 28, 2004.  The Company  currently
has 1,331,000  warrants  outstanding  exercisable  at $1.25.  The Company is not
obligated  to retire,  redeem,  repurchase  or  otherwise  reacquire  any of its
capital stock or other securities except for the Company's obligations to redeem
its Series A-1  Preferred  Stock and its Series A-2  Preferred  Stock  under the
terms thereof. Except as disclosed in the Commission Documents or in or pursuant
to this Agreement,  there are no stockholders  agreements,  voting agreements or
other similar  agreements  with respect to the Common Stock to which the Company
is a  party.  Except  as  disclosed  in or  pursuant  to this  Agreement  or the
Commission  Documents,  the Company does not directly or indirectly  own or have
any investment in any of the capital stock of, or any other proprietary interest
in, any Person.  The Company has not adopted a stockholders  rights plan, poison
pill or similar arrangement.  The consummation of the transactions  contemplated
by this  Agreement  will  not  accelerate  the  vesting  schedule  of any of the
Company's outstanding options or warrants.

      6.3 Corporate Power, Authorization;  Enforceability.  The Company has full
corporate power and authority to execute, deliver and enter into this Agreement,
the Certificate of Designations,  the Warrants  included in the Securities,  and
the Registration Rights Agreement  (collectively,  the "Transaction  Documents")
and to consummate the transactions  contemplated  hereby and thereby.  Except as
contemplated by this Agreement, including the next two succeeding sentences, all
action on the part of the Company,  its directors or stockholders  necessary for
the  authorization,  execution,  delivery  and  performance  of the  Transaction
Documents by the Company, the authorization,  sale, issuance and delivery of the
Securities  contemplated hereby and the performance of the Company's obligations
hereunder and  thereunder has been taken.  The Company has set aside  sufficient
Securities to satisfy the exercise of preemptive rights of holders of Series A-1
and Series A-2 Preferred  Stock during the thirty (30) day period  following the
final Closing, but the Company has not given those holders,  pursuant to Section
10 of the Series A-1 and Series A-2  Certificate  of  Designations,  thirty (30)
days notice prior to the Initial  Closing and the  opportunity to exercise their
preemptive rights prior to the Initial Closing.  The Company is seeking consents
and/or waivers to permit the Company to furnish preemptive rights to the holders
of the Series A-1 and  Series  A-2  Preferred  Stock in the manner it intends as
described  in this  Section.  These  circumstances,  concerning  the exercise of
preemptive  rights by the  holders of the  Series  A-1 and Series A-2  Preferred
Stock,  are  sometimes   hereinafter  referred  to  as  the  "PREEMPTIVE  RIGHTS
CIRCUMSTANCES". Subject to the foregoing, the Securities to be purchased on each
the Closing Date,  the  Conversion  Shares  issuable upon the  conversion of the
Series B Preferred  Stock and the Warrant  Shares  issuable upon exercise of the
Warrants have been duly  authorized  and,  when issued in  accordance  with this
Agreement,  the Certificate of Designations or the Warrants, as the case may be,
will be validly issued,  fully paid and nonassessable and will be free and clear

                                       8
<PAGE>

of any mortgage, deed of trust, pledge, hypothecation,  assignment, encumbrance,
lien  (statutory  or other) or  preference,  priority,  right or other  security
interest or preferential arrangement of any kind or nature whatsoever (excluding
preferred stock and equity related preferences) (collectively,  "Liens") imposed
by or through the Company other than restrictions imposed by this Agreement, the
Certificate of Designations,  and the Registration Rights Agreement, as the case
may be, and  applicable  securities  laws.  Except as referenced in this Section
6.3,  no  preemptive  or  other  rights  to  subscribe  for or  purchase  equity
securities  of the Company  exists with  respect to the issuance and sale of the
Securities or the shares of Common Stock issuable upon  conversion of the Series
B  Preferred  Stock.  The  Transaction  Documents  have been duly  executed  and
delivered  by  the  Company,   and  constitute  the  legal,  valid  and  binding
obligations of the Company,  enforceable  against the Company in accordance with
their terms,  except as enforceability may be limited by applicable  bankruptcy,
insolvency,  reorganization,  fraudulent  conveyance or transfer,  moratorium or
similar laws  affecting the  enforcement of creditors'  rights  generally and by
general  principles of equity relating to enforceability  (regardless of whether
considered in a proceeding at law or in equity).

      6.4 Financial Statements and Commission Filings;  Undisclosed Liabilities.
(a) Included in the Company's Form 10-KSB/A for the year ended February 28, 2003
(the "2003  10-KSB")  are true and complete  copies of the audited  consolidated
balance sheet (the "2003 Balance Sheet") of the Company as of February 28, 2003,
and the related audited income statement and cash flow for the period then ended
(the "Financial Statements"),  accompanied by the report of each of Frank Hanson
CPA. As of their respective dates, the Financial  Statements complied as to form
in all  material  respects  with  applicable  accounting  requirements  and  the
published rules and  regulations of the Securities and Exchange  Commission (the
"Commission") with respect thereto.  The Financial Statements have been prepared
in accordance  with U.S.  generally  accepted  accounting  principles  ("GAAP"),
consistently  applied,  during  the  periods  involved  (except  in the  case of
unaudited interim statements, to the extent they may exclude footnotes or may be
condensed or summary statements) and fairly present in all material respects the
consolidated  financial  position of the Company as of the dates thereof and the
results of its operations and cash flows for the periods then ended (subject, in
the case of unaudited  statements,  to normal year-end audit  adjustments).  The
Company  keeps  proper  accounting  records  in which all  material  assets  and
liabilities  and all  material  transactions  of the  Company  are  recorded  in
conformity with GAAP.

      (b) Since February 28, 2003, the Company has 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 Securities Exchange Act
of 1934, as amended (the "Exchange Act") (all of the foregoing,  including,  but
not limited to, the 2003 10-KSB, filed prior to the date hereof and all exhibits
included  therein and financial  statements and schedules  thereto and documents
incorporated  by  reference  therein  being  hereinafter   referred  to  as  the
"Commission  Documents") and all such Commission Documents were filed within the
time periods specified in the Exchange Act. As of their respective filing dates,
each Commission Document complied in all material respects with the requirements
of the  Securities  Act or the Exchange  Act, as  applicable,  and the rules and
regulations of the Commission thereunder applicable to the Commission Documents,
and no Commission  Document contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements  therein. As of their respective filing dates, the financial
statements of the Company  included in the Commission  Documents  complied as to
form in all material respects with then applicable  accounting  requirements and
with the published rules and regulations of the Commission with respect thereto,
were prepared in accordance with GAAP and as of their respective  dates,  fairly
presented in all material  respects the consolidated  financial  position of the
Company  and the  results of its  operations  as of the time and for the periods
indicated  therein  (except as may be indicated in the notes  thereto or, in the
case of the unaudited  statements,  as permitted by Form 10-QSB, and Regulations
S-B and S-X of the Commission).

                                       9
<PAGE>

      (c) Since February 28, 2003, the Company has not incurred any  liabilities
or obligations of any nature,  whether or not accrued,  absolute,  contingent or
otherwise   ("Liabilities"),   other  than  liabilities  (i)  disclosed  in  the
Commission Documents filed prior to the date of this Agreement,  (ii) adequately
provided for in the Balance  Sheet or disclosed  in any related  notes  thereto,
(iii)  incurred  in  connection  with this  Agreement,  or (iv)  incurred in the
ordinary  course of  business,  in each case  other  than  such  liabilities  or
obligations which do not have a Material Adverse Effect.

      6.5 No Material  Adverse  Changes.  Since  February  28,  2003,  except as
disclosed in the Commission  Documents filed  subsequent to that date, there has
not been any material  adverse  change in the business,  financial  condition or
operating results of the Company.

      6.6 Absence of Certain Developments. Except as contemplated in or pursuant
to  this  Agreement  and as  contemplated  by the  Commission  Documents,  since
February 28, 2003, through the date immediately preceding each Closing Date, the
Company  has not (a)  issued  any  stock,  options,  bonds  or  other  corporate
securities  other than as  reflected  in Section 6.2 hereof,  (b)  borrowed  any
amount or incurred or became subject to any  Liabilities  (absolute,  accrued or
contingent),  other than current Liabilities  incurred in the ordinary course of
business and Liabilities  under contracts entered into in the ordinary course of
business, (c) discharged or satisfied any material Lien or adverse claim or paid
any  obligation  or  Liability  (absolute,  accrued or  contingent),  other than
current Liabilities shown on the Balance Sheet and current Liabilities  incurred
in the  ordinary  course  of  business,  (d)  declared  or made any  payment  or
distribution  of cash or other  property to the  stockholders  of the Company or
purchased or redeemed any securities of the Company,  (e) mortgaged,  pledged or
subjected to any material Lien or adverse claim any of its properties or assets,
except for Liens for taxes not yet due and payable or  otherwise in the ordinary
course of  business,  (f)  sold,  assigned  or  transferred  any of its  assets,
tangible  or  intangible,  except in the  ordinary  course of  business or in an
amount less than $250,000,  (g) suffered any extraordinary  losses or waived any
rights of material value other than in the ordinary course of business, (h) made
any capital  expenditures  or  commitments  therefor  other than in the ordinary
course of  business  or in an amount less than  $250,000,  (i) entered  into any
other  transaction  other than in the  ordinary  course of business in an amount
less than $250,000 or entered into any material  transaction,  whether or not in
the  ordinary  course of  business,  (j) made any  charitable  contributions  or
pledges, (k) suffered any damages,  destruction or casualty loss, whether or not
covered by insurance,  affecting any of the  properties or assets of the Company
or any other properties or assets of the Company which could, individually or in
the  aggregate,  have or  result  in a  Material  Adverse  Effect,  (l) made any
material change in the nature or operations of the business of the Company,  (m)
participated  in any  transaction  that would have a Material  Adverse Effect or
otherwise acted outside the ordinary course of business, (n) the Company has not
increased the  compensation  of any of its officers or the rate of pay of any of
its employees,  except as part of regular compensation increases in the ordinary
course of business,  (o) entered into any  agreement or  commitment to do any of
the foregoing.

      6.7 No Conflict;  Governmental Consents. (a) The execution and delivery by
the  Company  of  the  Transaction   Documents  and  the   consummation  of  the
transactions contemplated hereby and thereby will not (i) except with respect to
the  Preemptive  Rights  Circumstances,  if change is not consented to or rights
waived prior to the Initial Closing, result in the violation of any provision of
the Certificate of Incorporation or By-laws or other organizational documents of
the Company, (ii) result in any violation of any law, statute, rule, regulation,
order,  writ,  injunction,  judgment  or  decree  of any  court or  Governmental
Authority  to or by which the Company is bound,  or (iii) except with respect to
the  Preemptive  Rights  Circumstances,  if change is not consented to or rights
waived prior to the Initial  Closing,  conflict  with,  or result in a breach or
violation of, any of the terms or provisions of, or constitute  (with due notice
or lapse of time or both) a default under,  any bond,  debenture,  note or other
evidence of indebtedness, or any material lease, contract, indenture,  mortgage,
deed of trust, loan agreement, joint venture or other agreement or instrument to
which the Company is a party or by which it or its property is bound, nor result
in the creation or imposition  of any Lien upon any of the  properties or assets
of the  Company,  except  for,  in the case of  clauses  (ii) and  (iii) of this
subsection  6.7(a), any violation,  conflict,  breach or default which would not
have a Material Adverse Effect.

                                       10
<PAGE>

      (b) No material consent, approval, license, permit, order or authorization
of, or  registration,  declaration  or filing  with,  any court,  administrative
agency or commission or other Governmental  Authority or Person, and no lapse of
any waiting  period under any  Requirements  of Law,  remains to be obtained (or
lapsed) or is  otherwise  required to be  obtained by the Company in  connection
with the authorization,  execution and delivery of the Transaction  Documents or
the consummation of the transactions contemplated hereby or thereby,  including,
without limitation the issue and sale of the Securities and the shares of Common
Stock underlying such  Securities,  except except with respect to the Preemptive
Rights  Circumstances,  if change is not  consented to or rights waived prior to
the Initial Closing,  with (i) the Commission,  (ii) the National Association of
Securities Dealers,  Inc. ("NASD"),  or (iii) state blue sky or other securities
regulatory  authorities.  For purposes of this Agreement,  "Requirements of Law"
means, as to any Person,  any law, statute,  treaty,  rule,  regulation,  right,
privilege, qualification, license or franchise or determination of an arbitrator
or a court or other  government of any nation,  state,  city,  locality or other
political  subdivision  thereof, any entity exercising  executive,  legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any  corporation  or other  entity  owned or  controlled,  through  stock or
capital  ownership or otherwise,  by any of the foregoing (each, a "Governmental
Authority")  or stock  exchange,  in each case  applicable  or binding upon such
Person or any of its  property or to which such Person or any of its property is
subject or pertaining to any or all of the transactions contemplated or referred
to herein.

      6.8  Litigation.  Except as set forth in the  Commission  Documents  or as
disclosed in or pursuant to this Agreement, there are no claims, actions, suits,
investigations or proceedings pending or, to the Company's knowledge, threatened
proceedings  against the Company or its respective  assets, at law or in equity,
by or before any Governmental  Authority, or by or on behalf of any third party,
except for any claim, action, suit,  investigation or proceeding which would not
have a Material Adverse Effect nor does the Company have knowledge that there is
any  reasonable  basis for any of the foregoing.  There are no claims,  actions,
suits,  investigations  or proceedings  pending or, to the Company's  knowledge,
threatened  proceedings  against the Company contesting the right of the Company
to use,  sell,  import,  license,  or make  available  to any  Person any of the
Company's products or services currently or previously sold,  offered,  licensed
or made available to any Person or used by the Company or opposing or attempting
to cancel any of the  Company's  Intellectual  Property  rights,  except for any
claim, action, suit, investigation or proceeding which would not have a Material
Adverse Effect.

      6.9 Compliance  with Laws; No Default or Violation;  Contracts.  Except as
set forth in the  Commission  Documents  or as  disclosed in or pursuant to this
Agreement,  the  Company is in  compliance  in all  material  respects  with all
Requirements of Law and all orders issued by any court or Governmental Authority
against the Company in all material respects. To the Company's knowledge,  there
is no existing or currently  proposed  Requirement of Law which could reasonably
be expected to prohibit or restrict the Company  from,  or otherwise  materially
adversely affect the Company in,  conducting its business in any jurisdiction in
which it now conducts or proposes to conduct such business.  The Company has all
material  licenses,   permits  and  approvals  of  any  Governmental   Authority
(collectively,  "Permits") that are necessary for the conduct of the business of
the  Company;  (ii) such  Permits  are in full  force and  effect;  and (iii) no
violations  are or have been  recorded  in respect of any  Permit.  No  material
expenditure  is  presently  required by the Company to comply with any  existing
Requirements of Law or order.  Except disclosed in or pursuant to this Agreement
or as would not be reasonably  expected to have a Material  Adverse Effect,  the
Company is not (i) in default  under or in violation of any  indenture,  loan or
credit  agreement or any other agreement or instrument to which it is a party of
by which it or any of its properties is bound or (ii) in violation of any order,
decree or judgment of any court, arbitrator or other Governmental Authority. The
contracts  described in the Commission  Documents or  incorporated  by reference

                                       11
<PAGE>

therein  that  are  material  to the  Company  (collectively,  the  "Contractual
Obligations")  are in full force and effect on the date hereof,  and neither the
Company nor, to the Company's knowledge, any other party to such contracts is in
breach  of or  default  under  any of  such  contracts  nor,  to  the  Company's
knowledge,  does any  condition  exist that with notice or lapse of time or both
would constitute a default by such other party  thereunder,  except with respect
to the Preemptive Rights Circumstances,  if change is not consented to or rights
waived prior to the Initial Closing,. Except as disclosed in or pursuant to this
Agrement, the Company has not received notice of a default and is not in default
under,  or with respect to, any  Contractual  Obligation  nor, to the  Company's
knowledge,  does any  condition  exist that with notice or lapse of time or both
would constitute a default thereunder.  All of such Contractual  Obligations are
valid, subsisting, in full force and effect and binding upon the Company and, to
the Company's knowledge,  the other parties thereto, and the Company has paid in
full or accrued all amounts due thereunder and has satisfied in full or provided
for all of its liabilities and obligations thereunder.

      6.10  Insurance.  The  Company  maintains  and will  continue  to maintain
insurance of the types and in the amounts that the Company  reasonably  believes
is adequate for its business,  including, but not limited to, insurance covering
all real and personal  property  owned or leased by the Company  against  theft,
damage,  destruction,  acts of vandalism and all other risks customarily insured
against by similarly situated companies, all of which insurance is in full force
and effect.

      6.11 Environmental Matters. The Company is in compliance,  in all material
respects, with all applicable Environmental Laws. There is no civil, criminal or
administrative  judgment,  action,  suit,  demand,  claim,  hearing,  notice  of
violation, investigation, proceeding, notice or demand letter pending or, to the
Company's  knowledge,  threatened  against the Company pursuant to Environmental
Laws.  To  the  Company's  knowledge,  there  are no  past  or  present  events,
conditions, circumstances, activities, practices, incidents, agreements, actions
or plans which could reasonably be expected to prevent compliance with, or which
have given rise to or will give rise to  liability  which  would have a Material
Adverse  Effect,  under  Environmental  Laws.  For  purposes  of the  foregoing,
"Environmental Laws" means federal, state, local and foreign laws, principles of
common laws,  civil laws,  regulations,  and codes, as well as orders,  decrees,
judgments or injunctions,  issued,  promulgated,  approved or entered thereunder
relating  to  pollution,  protection  of the  environment  or public  health and
safety.

      6.12 Taxes.  The Company has paid or caused to be paid, or has established
reserves  in  accordance  with GAAP for all Tax  liabilities  applicable  to the
Company for all fiscal years that have not been  examined and reported on by the
taxing  authorities  (or  closed by  applicable  statutes).  No  additional  Tax
assessment against the Company has been heretofore proposed or, to the Company's
knowledge,  threatened by any Governmental Authority for which provision has not
been made on its balance sheet.

      No  tax  audit  is  currently  in  progress  and  there  is no  unassessed
deficiency  proposed  or, to the  Company's  knowledge,  threatened  against the
Company.  The  Company has no  knowledge  of any change in the rates or basis of
assessment  of any Tax (other than  federal  income tax),  of the Company  which
would reasonably be expected to have a Material Adverse Effect.  The Company has
not agreed to or is required to make any  adjustments  under  section 481 of the
Code by reason of a change of accounting method or otherwise. None of the assets
of the Company is  required  to be treated as being  owned by any Person,  other
than the  Company  or any of its  subsidiaries,  pursuant  to the "safe  harbor"
leasing  provisions  of  Section  168(f)(8)  of the Code.  The  company is not a
"United States real property  holding  corporation" (a "USRPHC") as that term is
defined  in  Section  897(c)(2)  of the  Code  and the  regulations  promulgated
thereunder.

                                       12
<PAGE>

      For purposes of this Agreement,  "Code" means the Internal Revenue Code of
1986, as amended,  and "Taxes"  means any federal,  state,  provincial,  county,
local, foreign and other taxes (including,  without limitation, income, profits,
windfall profits,  alternative,  minimum, accumulated earnings, personal holding
company, capital stock, premium, estimated, excise, sales, use, occupancy, gross
receipts, franchise, ad valorem, severance, capital levy, production,  transfer,
withholding,  employment, unemployment compensation, payroll and property taxes,
import duties and other  governmental  charges and assessments),  whether or not
measured  in  whole  or in  part  by net  income,  and  including  deficiencies,
interest,  additions to tax or interest, and penalties with respect thereto, and
including expenses  associated with contesting any proposed  adjustments related
to any of the foregoing.

      6.13 Intellectual Property.

      (a)  "Intellectual  Property"  shall mean all of the following as they are
necessary in connection with the business of the Company as presently  conducted
and as they exist in all  jurisdictions  throughout the world,  in each case, to
the extent owned by or licensed to the Company: (i) patents, patent applications
and  inventions,   designs  and  improvements  described  and  claimed  therein,
patentable   inventions  and  other  patent  rights  (including  any  divisions,
continuations, continuations-in-part, reissues, reexaminations, or interferences
thereof,  whether or not patents are issued on any such applications and whether
or  not  any  such  applications  are  modified,   withdrawn,   or  resubmitted)
("Patents");  (ii) trademarks,  service marks,  trade dress,  trade names, brand
names,  designs,  logos, or corporate names, whether registered or unregistered,
and all registrations and applications for registration thereof  ("Trademarks");
(iii) copyrights and mask works,  including all renewals and extensions thereof,
copyright   registrations  and  applications  for  registration   thereof,   and
non-registered  copyrights  ("Copyrights");   (iv)  trade  secrets,  inventions,
know-how,  process technology,  databases,  confidential  business  information,
customer  lists,  technical data and other  proprietary  information  and rights
("Trade   Secrets");   (v)  computer  software  programs,   including,   without
limitation,  all source code,  object code, and  documentation  related  thereto
("Software");  (vi) Internet  addresses,  domain names, web sites, web pages and
similar  rights  and  items  ("Internet   Assets");   and  (vii)  all  licenses,
sublicenses and other  agreements or permissions  including the right to receive
royalties,  or any other  consideration  related to the  property  described  in
(i)-(vi).  The Intellectual  Property contains all of the intellectual  property
necessary to operate the business of the Company as currently conducted.

      (b) The Company  exclusively  owns (or  otherwise has the right to use the
Intellectual  Property  pursuant  to  a  valid  license,   sublicense  or  other
agreement), free and clear of all Liens, and has the unrestricted right (subject
to any such license terms, if applicable) to use, sell,  license,  or sublicense
all Intellectual Property.

      (c) [Intentionally omitted]

      (d) As used in this  Agreement,  the term "IP LICENSES" means all material
licenses,   sublicenses,   distributor   agreements  and  other   agreements  or
permissions  under  which  the  Company  is a (i)  licensor,  or (ii)  licensee,
distributor, or reseller, except such licenses, sublicenses and other agreements
relating to off-the-shelf  software which is commercially  available on a retail
basis for less than $500 per  license  and  $25,000  in the  aggregate  and used
solely  on the  computers  of the  Company  ("OFF-THE-SHELF  SOFTWARE").  To the
knowledge of the Company, all of the IP Licenses are valid, enforceable,  and in
full force and effect, and, with respect to the Company,  will continue to be on
identical  terms  immediately  following  the  completion  of  the  transactions
contemplated by this Agreement.

      (e) All products made,  used or sold by the Company under the Patents have
been marked with the proper patent notice.

                                       13
<PAGE>

      (f)  All  products  and  materials  made,  used  or  sold  by the  Company
containing   Trademarks  bear  the  proper  federal  registration  notice  where
permitted by law.

      (g) All works  encompassed  by the Copyrights and used by the Company have
been marked with the proper copyright notice.

      (h) To the Company's knowledge, upon reasonable inquiry in accordance with
sound business practice and business  judgment,  all the Company's  Intellectual
Property rights are valid and enforceable.  The Company has taken all reasonably
necessary  actions to maintain  and protect each item of  Intellectual  Property
owned by the Company.

      (i) The  Company  has taken all  reasonable  precautions  to  protect  the
secrecy,  confidentiality,  and value of its Trade  Secrets and the  proprietary
nature  and value of its  Intellectual  Property.  To the best of the  Company's
knowledge,  none of the Trade Secrets,  wherever located,  the value of which is
contingent upon maintenance of confidentiality  thereof,  have been disclosed to
any  employee,  representative  or agent of the Company or any other  person not
obligated  to  maintain   such  Trade  Secret  in   confidence   pursuant  to  a
confidentiality  agreement  entered  into with the  Company,  except as required
pursuant to the filing of a patent application by the Company.

      (j) The Company is diligently  prosecuting all Patent  applications it has
filed,  as instructed by patent  counsel.  The Company is diligently  filing and
preparing to file Patent  applications for all inventions in a manner and within
a sufficient  time period to avoid statutory  disqualification  of any potential
Patent application.

      (k) [intentionally omitted].

      (l) Unless  otherwise  disclosed  by the  Company or pursuant to a current
license,  it is not necessary for the Company's business to use any Intellectual
Property owned by any present or past director,  officer, employee or consultant
of the  Company  (or persons  the  Company  presently  intends to hire).  To the
knowledge  of the  Company,  at no time during the  conception  or  reduction to
practice  of any of the  Company's  Intellectual  Property  was  any  developer,
inventor or other contributor to such Intellectual  Property operating under any
grants from any Governmental  Authority or subject to any employment  agreement,
invention  and  assignment,   nondisclosure   agreement  or  other   Contractual
Obligation with any Person that could adversely  affect the Company's  rights to
its Intellectual Property.

      (m) To the knowledge of the Company, upon reasonable inquiry in accordance
with sound business  practice and business  judgment,  none of the  Intellectual
Property,  products  or  services  owned,  used,  developed,  provided,  sold or
licensed by the Company, or made for, used or sold by or licensed to the Company
by any person  infringes upon or otherwise  violates any  Intellectual  Property
rights of others.

      (n) To the knowledge of the Company, upon reasonable inquiry in accordance
with sound business practice and business judgment, no Person is infringing upon
or otherwise violating the Intellectual Property rights of the Company.

      6.14 Employee Benefit Plans.

      (a)  Neither  the  Company  nor any  entity  which is or was under  common
control  within  the  meaning  of Section  414(b),  (c),  (m) or (o) of the Code
maintains or contributes to, or has within the preceding six years maintained or
contributed  to, or may have any liability with respect to any employee  benefit

                                       14
<PAGE>

plan subject to Title IV of Employee  Retirement Income Security Act of 1974, as
amended  ("ERISA"),  or Section 412 of the Code or any "multiple  employer plan"
within  the  meaning  of  the  Code  or  ERISA.   Each  employee  benefit  plan,
arrangement,   policy,  program,  agreement  or  commitment  which  the  Company
maintains,  contributes  to or may have any  liability  in respect  to (each,  a
"Plan") has been  established and administered in accordance with its terms, and
complies in form and in operation with the applicable requirements of ERISA, the
Code and other  applicable  Requirements  of Law.  No claim with  respect to the
administration  or the  investment of the assets of any Plan (other than routine
claims for benefits) is pending.  No event has occurred in connection with which
the  Company  or any Plan,  directly  or  indirectly,  could be  subject  to any
material  liability  under  ERISA,  the Code or any  other  law,  regulation  or
governmental  order applicable to any Plan, or under any agreement,  instrument,
statute,  rule of law or  regulation  pursuant to or under which the Company has
agreed to  indemnify  any person  against  liability  incurred  under,  or for a
violation or failure to satisfy the requirement of, any such statute, regulation
or  order.  The  Company  has no  liability,  whether  absolute  or  contingent,
including any obligations under any Plan, with respect to any  misclassification
of any person as an independent contractor rather than as an employee.

      (b) The Company does not have any  obligations to provide or any direct or
indirect  liability,  whether  contingent  or  otherwise,  with  respect  to the
provision of health or death  benefits to or in respect of any former  employee,
except  as may be  required  pursuant  to  Section  4980B  of the  Code  and the
corresponding  provisions  of ERISA and the cost of which are fully paid by such
former employees.

      (c) There are no unfunded  obligations  under any Plan which are not fully
reflected on the Financial Statements.

      6.15 Investment Company.  The Company is not an "investment company" or an
"affiliated  person"  of,  or  "promoter"  or  "principal  underwriter"  for  an
investment company, within the meaning of the Investment Company Act of 1940, as
amended.

      6.16 Compliance.  The Common Stock is registered pursuant to Section 12(g)
of the Exchange  Act, and is quoted on the OTC Bulletin  Board,  and the Company
has taken no action  designed  to, or likely to have the effect of,  terminating
the  registration  of the Common Stock under the Exchange Act or terminating the
quotation of the Common Stock from the OTC Bulletin  Board.  The Company has not
taken and will not, in violation of applicable law, take, any action designed to
or that might reasonably be expected to cause or result in unlawful manipulation
of the  price of the  Common  Stock to  facilitate  the  sale or  resale  of the
Securities.

      6.17  Private   Offerings.   Assuming   the  truth  of  each   Purchaser's
representations and acknowledgments  contained in Section 5 hereof,  neither the
Company nor any Person  acting on its behalf (other than the  Purchasers,  as to
whom the Company makes no representations) has offered or sold the Securities by
means of any general  solicitation or general  advertising within the meaning of
Rule 502(c) under the Securities Act. The Company has not sold the Securities to
anyone other than the  subscribers to this  Agreement.  Each Security shall bear
substantially the same legend set forth in Section 8 hereof for at least so long
as required by the Securities Act.

      6.18 Broker's or Finder's Commissions.  Other than the Placement Agent (as
placement agent on behalf of the Company) or any Other  Participating  Agent, no
finder,  broker,  agent,  financial  person or other  intermediary  has acted on
behalf of the  Company  in  connection  with the sale of the  Securities  by the
Company  or the  consummation  of  this  Agreement  or  any of the  transactions
contemplated hereby. The Company has not had any direct or indirect contact with
any other investment banking firm (or similar firm) with respect to the offer of
the Securities by the Company to the Purchasers or the Purchasers' subscriptions
for the Securities.

                                       15
<PAGE>

      6.19  Disclosure.  The  Transaction  Documents  do not  contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make  the  statements  contained  herein  or  therein,  in the  light  of the
circumstances  under which they were made, not misleading.  The Company does not
have any  knowledge  of any fact that has  specific  application  to the Company
(other than general economic or industry  conditions) and that can reasonably be
foreseen to cause a Material  Adverse  Effect that has not been set forth in the
Transaction Documents or the Commission Documents.

      The  Company  certifies  that each of the  foregoing  representations  and
warranties  by the Company  sets forth in this Section 6 are true as of the date
hereof and shall survive such date as contemplated in Section 7.1.

      7. Indemnification.

      7.1 The Company  agrees to indemnify  and hold  harmless  the  Purchasers,
their affiliates and each of their respective directors,  officers,  general and
limited   partners,   principals,   agents  and  attorneys   (individually,   an
"Indemnified  Party"  and  collectively,  the  "Indemnified  Parties")  from and
against any and all  losses,  claims,  damages,  Liabilities,  costs  (including
reasonable attorneys' fees) and expenses  (collectively,  "Losses") to which any
Indemnified  Party may become  subject,  insofar as such Losses arise out of, in
any way  relate  to, or result  from (i) any  breach  of any  representation  or
warranty made by the Company contained in or made pursuant to this Agreement, or
(ii) the failure of the Company to fulfill any  agreement or covenant  contained
in or made pursuant to this Agreement. All of the representations and warranties
of the Company  made herein  shall  survive the  execution  and delivery of this
Agreement  until  the date  that is ninety  (90)  days  after the  filing by the
Company with the Commission of audited  financial  statements of the Company for
the fiscal year ending February 28, 2004 (or, if such fiscal year changes and no
such audited consolidated financial statements are available, then the successor
fiscal  year),  except for (a) Sections  6.1  (Organization,  Good  Standing and
Qualification),  6.2  (Capitalization),  6.3  (Corporate  Power,  Authorization;
Enforceability),  6.18  (Private  Offerings)  and  6.19  (Broker's  or  Finder's
Commission), which representations and warranties shall survive indefinitely (or
if  indefinite  survival is not  permitted by law,  then for the maximum  period
permitted by applicable law), (b) Section 6.12 (Taxes), which representation and
warranty  shall survive until the later to occur of (i) the lapse of the statute
of  limitations  with  respect  to the  assessment  of any  tax  to  which  such
representation  and  warranty  relates  (including  any  extensions  or  waivers
thereof)  and (ii) sixty (60) days after the final  administrative  or  judicial
determination of the Taxes to which such  representation  and warranty  relates,
and no claim with  respect to Section 6.12 may be asserted  thereafter  with the
exception of claims arising out of any fact, circumstance,  action or proceeding
to which the party  asserting  such claim  shall have given  notice to the other
parties to this Agreement  prior to the termination of such period of reasonable
belief that a tax liability will subsequently  arise therefrom,  and (c) Section
6.11 (Environmental  Matters),  which  representation and warranty shall survive
until the lapse of the applicable  statute of  limitations.  Except as set forth
herein,  all of the covenants,  agreements and obligations of the parties hereto
shall  survive  the  Closing  indefinitely  (or if  indefinite  survival  is not
permitted by law, then for the maximum period permitted by applicable law).

      7.2 Promptly  after receipt by an  Indemnified  Party under Section 7.1 of
notice of any claim as to which  indemnity  may be  sought,  including,  without
limitation,  the commencement of any action or proceeding, the Indemnified Party
will, if a claim in respect thereof may be made against the  indemnifying  party
under this Section,  promptly  notify the  indemnifying  party in writing of the
commencement  thereof;  provided that the failure of the Indemnified Party to so
notify the indemnifying  party will not relieve the indemnifying  party from its
obligations  under  this  Section  unless,  and only to the  extent  that,  such

                                       16
<PAGE>

omission results in the indemnifying party's forfeiture of substantive rights or
defenses or being materially  prejudiced by the Indemnified  Person's failure to
give such  notice.  In case any  action or  proceeding  is brought  against  any
Indemnified  Party, and it notifies the  indemnifying  party of the commencement
thereof,  the indemnifying party shall be entitled to assume the defense thereof
at its own expense,  with counsel  satisfactory to such Indemnified Party in its
reasonable   approval   (which   approval   will  not  be  withheld  or  delayed
unreasonably);  provided,  however,  that any Indemnified  Party may, at its own
expense,  retain  separate  counsel to  participate  in such  defense at its own
expense.  After notice from the indemnifying  party to the Indemnified  Party of
its election to so assume the defense thereof,  the indemnifying  party will not
be Liable to the  Indemnified  Party  under that  Section 7 for any legal or any
other expenses subsequently incurred by the Indemnified Party in connection with
the  defense  thereof  (other than  reasonable  costs of  investigation)  unless
incurred at the written request of the indemnifying  party.  Notwithstanding the
above,  the  Indemnified  Party will have the right to employ counsel of its own
choice in any action or proceeding (and be reimbursed by the indemnifying  party
for the reasonable fees and expenses of the counsel and other  reasonable  costs
of the defense) if, in the written opinion of such Indemnified  Party's counsel,
representation  of  the  Indemnified  Party  by  the  counsel  retained  by  the
indemnifying  party would be inappropriate due to actual or potential  differing
interests  or  conflicts  between  the  Indemnified  Party and any  other  party
represented  by  the  counsel  in  the  action;  provided,   however,  that  the
indemnifying  party will not in connection  with any one action or proceeding or
separate but  substantially  similar  actions or proceedings  arising out of the
same general allegations, be Liable for the reasonable fees and expenses of more
than one separate  firm of attorneys  at any time for all  Indemnified  Parties,
except to the extent that local  counsel,  in addition  to regular  counsel,  is
required in order to effectively  defend  against the action or  proceeding.  An
indemnifying  party  will  not  be  Liable  to any  Indemnified  Party  for  any
settlement or entry of judgment  concerning  any action or  proceeding  effected
without  the  consent of the  indemnifying  party,  which  consent  shall not be
unreasonably  withheld.  The indemnifying party agrees that it will not, without
the prior  written  consent of the  Indemnified  Party,  settle,  compromise  or
consent to the entry of any judgment in any pending or threatened claim relating
to the matters  contemplated hereby (if any Indemnified Party is a party thereto
or has  been  actually  threatened  to be  made a  party  thereto)  unless  such
settlement,  compromise  or consent  includes an  unconditional  release of each
Indemnified  Party  from all  liability  arising  or that may  arise out of such
claim.  The  rights  accorded  to an  Indemnified  Party  hereunder  shall be in
addition  to any rights  that any  Indemnified  Party may have at common law, by
separate agreement or otherwise;  provided,  however,  that  notwithstanding the
foregoing or anything to the contrary  contained in this Agreement,  (a) nothing
in this Section 7 shall restrict or limit any rights that any Indemnified  Party
may  have to seek  equitable  relief  and (b) this  Section  7 shall be the sole
remedy for any breach of the Company's  representations and warranties contained
in  Section 6 except  with  respect  to claims  arising  out of fraud or willful
misconduct.

      8. Covenants.

      8.1 Use of Proceeds.  The Company will use the proceeds from this Offering
to pay for shares in DCS Automotive  Limited, on substantially the same terms as
disclosed  in the letter of  intent.  In the event  that the  Company  elects to
increase the maximum  amount of the Offering by up to Ten Percent  (10%),  as it
may do at its sole election,  or if the Company obtains additional proceeds from
the exercise of preemptive rights as disclosed in this Agreement, the additional
proceeds will be used for working capital,  including,  without limitation,  for
such acquisitions as the Company may hereafter consider from time to time.

      8.2 Business  Development.  As soon as practicable after the Closing,  the
Company shall use commercially  reasonable  efforts to: (a) create and implement
an annual budget,  approved by the Board,  (b) hire  additional  personnel where
necessary;  and (c) obtain appropriate  product liability insurance to cover all
risks  associated  with the  Company's  business  that are  customarily  insured
against in the industry in such amounts as are customary in the industry.

      8.3 [intentionally omitted].

                                       17
<PAGE>

      8.4 Conduct of the  Company's  Business.  Except as  contemplated  by this
Agreement,  during the period  from the date  hereof to the  Closing  Date,  the
Company will conduct its business and operations  solely in the ordinary  course
of business consistent with past practice and use reasonable  commercial efforts
to keep  available  the services of its officers and  employees and preserve its
current relationships with customers, suppliers, licensors, creditors and others
having business dealings with it.

      8.5 Reasonable  Best Efforts.  Subject to the terms and conditions of this
Agreement,  each of the parties hereto will use its  reasonable  best efforts to
take,  or cause to be taken,  all actions,  and to do, or cause to be done,  all
things  necessary,  proper or advisable under applicable laws and regulations to
consummate  the  transactions  contemplated  by this  Agreement  at the earliest
practicable date.

      8.7 Tax Matters.

      (a) The Company covenants that it will use commercially reasonable efforts
not to  become  a  USRPHC  at any  time  while  any  Purchaser  owns  any of the
Securities.

      (b) In the event that a Purchaser desires to sell or dispose of any of the
Securities or Conversion  Stock as permitted under this Agreement and applicable
law, and upon demand by such  Purchaser,  the Company  agrees to deliver to such
Purchaser a letter (the "Letter")  which  complies with Sections  1.1445-2(c)(3)
and 1.897-2(h) of the Treasury Regulations, addressed to such Purchaser, stating
whether or not the Company is a USRPHC.  The Letter  shall be  delivered  to the
Purchaser one business day prior to the close of any sale or  disposition of the
Securities  or Conversion  Stock by the Purchaser  (the  "Delivery  Date").  The
Letter shall be dated as of the Delivery Date and signed by a corporate  officer
who must verify under  penalties of perjury that the statement is correct to his
knowledge and belief pursuant to Section 1.897-2(h) of the Treasury Regulations.

      8.8 Furnishing of Information.  As long as any Purchaser owns  Securities,
the Company covenants that it will use its commercially  reasonable best efforts
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 the  Exchange  Act. As long as any  Purchaser  owns
Securities,  if the  Company is not  required to file  reports  pursuant to such
laws,  it will use its  commercially  reasonable  best  efforts to  prepare  and
furnish to the  Purchasers and make publicly  available in accordance  with Rule
144(c) such information as is required for the Purchasers to sell the Securities
under Rule 144.

      8.9  Non-Public  Information.  The Company  represents  and warrants  that
neither it nor, to the best of its  knowledge,  any other  Person  acting on its
behalf, has provided any Purchaser or its agents or counsel with any information
that the Company believes  constitutes material non-public  information,  unless
prior thereto such Purchaser shall have executed a written  agreement  regarding
the  confidentiality  and use of such information.  The Company  understands and
acknowledges that each Purchaser is relying on the foregoing  representations in
effecting transactions in securities of the Company.

      8.10 Legend Removal

      (a) The Company agrees that certificates  evidencing the Conversion Shares
and the  Warrant  Shares  shall not  contain  any  legend not  required  by then
applicable    securities   laws   (including   judicial    interpretations   and
pronouncements  issued by the Staff of the  Commission)  or  provided  for under
Section 5.10 of this  Agreement.  Consequently,  in respect of any  certificates
which contain a legend which is no longer so required,  the Company will use its
best efforts to cause the legend  permitted under Section 5.10 of this Agreement
to be  removed  and  deliver  or  cause  to be  delivered  to such  Purchaser  a
certificate  representing  such  Securities  free from such  restrictive  legend
within five (5) business days following proper delivery by such Purchaser to the
Company's transfer agent of a certificate  representing the Conversion Shares or
the  Warrant  Shares,  as the case may be,  unless the  failure to deliver  such
certificate in a timely manner is a result of force majeure. The Company may not
make any notations on its records or give  instructions to any transfer agent of
the Company that enlarge the  restrictions on transfer set forth in this Section
except in accordance with applicable laws and regulations, if any.

                                       18
<PAGE>

      (b)  The  Company  agrees  that,  unless  otherwise  required  under  then
applicable    securities   laws   (including   judicial    interpretations   and
pronouncements  issued by the  Staff of the  Commission),  in the  event  that a
registration  statement  covering the resale of Conversion Shares and/or Warrant
Shares is declared  effective  by the  Commission  and during the period  during
which such  registration  statement is  effective,  in order to  facilitate  the
resale of the shares covered by such registration statement the Company will use
its best efforts to cause the Company's transfer agent to deliver to each holder
of  such  shares  covered  by  such  registration  statement  a  certificate  or
certificates not containing the restrictive  legend  referenced in the preceding
paragraph on the terms and conditions set forth in the next succeeding sentence.
The Company  will use its best  efforts to cause the  transfer  agent to deliver
such  replacement  certificate  or  certificates  within five (5) business  days
following proper delivery by the applicable  Purchaser to the Company's transfer
agent of the  certificate or certificates  evidencing the applicable  Conversion
Shares and/or Warrant Shares

      (c) In order to induce  the  Company  to remove  legends  as  provided  in
Section  8.10(b),  each  Purchaser,  severally,  agrees  that the removal of the
restrictive  legend from  certificates  representing  Securities as set forth in
Section 8.10 is predicated  upon the Company's  reliance that the Purchaser will
sell any  Securities  pursuant to either the  registration  requirements  of the
Securities Act, including any applicable prospectus delivery requirements, or an
exemption therefrom.

      9. FOR RESIDENTS OF ALL STATES:  NEITHER THE SECURITIES  OFFERED HEREBY OR
THE SECURITIES  INTO WHICH SUCH SECURITIES MAY BE CONVERTED HAVE BEEN REGISTERED
UNDER THE  SECURITIES  ACT OF 1933, AS AMENDED,  OR THE  SECURITIES  LAWS OF ANY
STATE  AND ARE  BEING  OFFERED  AND  SOLD IN  RELIANCE  ON  EXEMPTIONS  FROM THE
REGISTRATION  REQUIREMENTS OF SAID ACT AND SUCH LAWS. THE SECURITIES ARE SUBJECT
TO  RESTRICTIONS  ON  TRANSFERABILITY  AND RESALE AND MAY NOT BE  TRANSFERRED OR
RESOLD EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS PURSUANT TO REGISTRATION
OR EXEMPTION THEREFROM.  INVESTORS SHOULD BE AWARE THAT THEY WILL BE REQUIRED TO
BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

      10. No Waiver.

      Notwithstanding any of the representations, warranties, acknowledgments or
agreements  made herein by the  Purchasers,  the Purchasers do not thereby or in
any manner waive any rights  granted to the  Purchasers  under  federal or state
securities laws.

      11. Miscellaneous.

      11.1 Notices.  Any notice or other  communication  given  hereunder by any
party  hereto  to any other  party  hereto  shall be in  writing  and  delivered
personally or by facsimile  transmission or sent by registered or certified mail
or by any express mail or overnight courier service, postage or fees prepaid:

                                       19
<PAGE>

                  If to the Company:

                           Auto Data Network, Inc.
                           712 Fifth Avenue
                           19th Floor
                           New York, New York  10019
                           Attention:  Chief Executive Officer

                  If to the Purchasers:

                           To each Purchaser at such Purchaser's name and
                           address set forth on the signature page to this
                           Agreement

      Any notice that is delivered  personally or by facsimile  transmission  in
the manner  provided herein shall be deemed to have been duly given to the party
to whom it is  directed  upon  actual  receipt by such  party or its agent.  Any
notice  that is  addressed  and mailed or sent by  courier in the manner  herein
provided shall be conclusively  presumed to have been duly given to the party to
which it is addressed at the close of business,  local time of the recipient, on
the  fourth  business  day  after  the day it is so  placed  in the mail or,  if
earlier, the time of actual receipt.

      11.2 Successors and Assigns. This Agreement will be binding upon and inure
to the  benefit of the  parties  hereto  and to their  respective  heirs,  legal
representatives, successors and assigns, provided, that no party may assign this
Agreement without the prior written consent of the other party, such consent not
to be unreasonably withheld; provided, further, that a Purchaser may assign this
Agreement  to its  affiliates  without  consent;  provided  that any transfer of
Securities  or shares of Common  Stock  underlying  such  Securities  must be in
compliance with the Transaction Documents and all applicable law.

      11.3 Entire Agreement.  This Agreement sets forth the entire agreement and
understanding  among the parties as to the subject  matter hereof and merges and
supersedes all prior discussions, agreements and understandings of any and every
nature  among them;  provided  that any  confidentiality  agreement  between the
Company and any Purchaser shall remain in effect.  This Agreement may be amended
only by mutual  written  agreement  of the Company and a majority in interest of
the Purchasers, and the Company may take any action herein prohibited or omit to
take any action  herein  required to be  performed  by it, and any breach of any
covenant,  agreement,  warranty  or  representation  may be waived,  only if the
Company has obtained the written consent or waiver of the Purchasers  purchasing
a majority of the Securities offered hereby.

      11.4 Governing  Law. This Agreement  shall be governed by and construed in
accordance with the laws of the State of New York with respect to contracts made
and to be fully  performed  therein,  without  regard to the  conflicts  of laws
principles thereof.  The parties hereto hereby agree that any suit or proceeding
arising under this  Agreement,  or in connection  with the  consummation  of the
transactions  contemplated hereby, shall be brought solely in a federal or state
court  located in the County of New York and State of New York. By its execution
hereof,  both the  Company and the  Purchasers  hereby  consent and  irrevocably
submit to the in personam  jurisdiction  of the federal and state courts located
in the  County of New York and State of New York and agree  that any  process in
any suit or  proceeding  commenced  in such courts under this  Agreement  may be
served upon it  personally or by certified or registered  mail,  return  receipt
requested,  or by Federal Express or other courier service,  with the same force
and effect as if personally  served upon the applicable party in New York and in
the city or county in which such other court is located. The parties hereto each
waive any claim that any such  jurisdiction  is not a  convenient  forum for any
such suit or proceeding and any defense of lack of in personam jurisdiction with
respect thereto.

                                       20
<PAGE>

      11.5  Severability.  The holding of any provision of this  Agreement to be
invalid or  unenforceable by a court of competent  jurisdiction  will not affect
any other  provision  of this  Agreement,  which  will  remain in full force and
effect.  If any provision of this  Agreement is declared by a court of competent
jurisdiction  to be invalid,  illegal or incapable of being enforced in whole or
in part, the provision  will be  interpreted so as to remain  enforceable to the
maximum  extent  permissible  consistent  with  applicable law and the remaining
conditions and provisions or portions thereof will  nevertheless  remain in full
force and  effect  and  enforceable  to the  extent  they are  valid,  legal and
enforceable,  and no provisions will be deemed dependent upon any other covenant
or provision unless so expressed herein.

      11.6 No Waiver.  A waiver by either party of a breach of any  provision of
this Agreement will not operate, or be construed,  as a waiver of any subsequent
breach by that same party.

      11.7  Further  Assurances.  The  parties  agree to execute and deliver all
further documents,  agreements and instruments and take further action as may be
necessary or appropriate to carry out the purposes and intent of this Agreement.

      11.8  Counterparts.  This  Agreement  may  be  executed  in  two  or  more
counterparts,  each of which will be deemed an  original,  but all of which will
together constitute the same instrument.

      11.9 No Third Party  Beneficiaries.  Nothing in this Agreement  creates in
any Person not a party to this Agreement any legal or equitable right, remedy or
claim under this Agreement,  and this Agreement is for the exclusive  benefit of
the parties hereto.  The parties expressly  recognize that this Agreement is not
intended to create a  partnership,  joint venture or other  similar  arrangement
between any of the parties or their respective affiliates.

      11.10 Headings.  The headings in this Agreement are solely for convenience
of reference and shall be given no effect in the construction or  interpretation
of this Agreement.

      11.11  Securities Laws  Disclosure;  Publicity  Restrictions.  The Company
shall,  by 8:30 a.m.  Eastern time on the trading day following each  applicable
Closing,  issue a press release or file a Current  Report on Form 8-K disclosing
the consummation of the transactions  consummated on such Closing. Except as may
be required by applicable  Requirements of Law, none of the parties hereto shall
issue  a  publicity  release  or  public  announcement  or  otherwise  make  any
disclosure  concerning  this Agreement,  the  transactions  contemplated  hereby
without prior  approval by the other party hereto;  provided that each Purchaser
may disclose on its worldwide web pages and its offering materials,  if any, the
name of the Company,  the name of the Chief Executive Officer of the Company,  a
brief description of the business of the Company  consistent with the Commission
Documents  or the  Company's  press  releases or other  public  statements,  the
Company's logo and the aggregate  amount of such  Purchaser's  investment in the
Company.  If any  announcement is required by applicable law or the rules of any
securities exchange or market on which such shares of Common Stock are traded to
be made by any party hereto,  prior to making such  announcement such party will
deliver a draft of such  announcement  to the other  parties  and shall give the
other parties  reasonable  opportunity to comment thereon.  The parties agree to
attribute and otherwise  indicate  ownership of the other party's trademarks and
logos.

      11.12 Certification. Each Purchaser certifies that such Purchaser has read
this entire Agreement and that every statement on such Purchaser's part made and
set forth herein is true and complete.

                  [Remainder of page intentionally left blank.]

                                       21
<PAGE>

      IN WITNESS WHEREOF,  the undersigned has executed this Securities Purchase
Agreement on the date his signature has been subscribed and sworn to below.

The shares of Series B Preferred Stock
and the common stock purchase warrants
are to be issued in:                                    Print Name of Investor

                                                        shares of Series B
____ individual name                                    Preferred Stock
                                                        subscribed for
                                                        Subscription price
                                                        paid herewith:
                                                        $
____ tenants in the entirety                            -----------------
                                                        (being $3.80 x the
                                                        number of shares
                                                        of Series B
                                                        Preferred Stock
                                                        listed above)

                                                        Print Name of Joint
____ corporation (an officer must sign)                 Investor(if
                                                        applicable)

____ partnership (all general partners must sign)       Signature of Investor

____ trust                                              Signature of Joint
                                                        Investor

                                                        (with a copy to:)

____ limited liability company Address of Investor Accepted as of the ___ day of
_________,  2004 as to  _______________  shares  of  Series B  Preferred  Stock;
Subscription price accepted being  $______________,  being $3.80 x the number of
shares of Series B  Preferred  Stock as to which this  Subscription  is accepted
(the investor also being entitled to receive _____________ common stock purchase
warrants,  being 2 warrants  for every 5 shares of Series B Preferred  Stock for
which the subscription is accepted:

AUTO DATA NETWORK, INC.

By:      ___________________________________________
Name:
Title:

                                       22

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