Document:

NO  SALE  OR  TRANSFER OF THIS WARRANT OR THE SECURITIES UNDERLYING THIS WARRANT
MAY  BE  MADE  UNTIL  THE  EFFECTIVENESS  OF  A  REGISTRATION  STATEMENT OR OF A
POST-EFFECTIVE  AMENDMENT  THERETO  UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), COVERING THIS WARRANT OR THE SECURITIES UNDERLYING THIS WARRANT, OR
UNTIL  THE  COMPANY  IS  IN RECEIPT OF AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY  STATING  THAT  SUCH  SALE  OR  TRANSFER IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS  OF  THE  ACT.

                                WARRANT AGREEMENT

     Warrant  Agreement (the "AGREEMENT") dated August 28, 2001 between Emergent
Financial Group, Inc., a Delaware corporation (the "COMPANY"), and Starfish, LLC
and  its  permitted  assigns  (the  "HOLDERS").

                             BACKGROUND INFORMATION
                             ----------------------

     WHEREAS,  the  Company  agreed  to  grant  warrants (the "Warrants") to the
Holder  to  induce the Holders to convert certain convertible securities held by
the Holders into the Company's common stock.  Under the terms agreed upon by the
parties,  the  Warrants  shall  entitle  the Holders to purchase up to 4,600,000
shares  of  the  Company's common stock, $0.01 par value ("COMMON STOCK") at any
time  prior  to June 30, 2006.  Each Warrant entitles the Holder to purchase one
duly  authorized,  fully  paid  and  nonassessable  share  of  Common Stock upon
exercise  thereof.

     WHEREAS, each Holder will be entitled to receive a certificate representing
the  Warrant  (each a "CERTIFICATE") and shall be dated effective as of the date
of  issuance.  The  shares of Common Stock issued upon exercise of the Warrants,
or  reserved  for  issuance  or otherwise issuable upon exercise of the Warrants
under  this  Agreement,  are  sometimes  hereinafter referred to as the "WARRANT
SHARES."

     WHEREAS,  the  Company  desires  to  fix  the  form  and provisions of each
Certificate  that  will  represent  one  or more issued Warrants, as well as the
terms  of  the  Warrants  themselves  with  respect  to  issuance, exercise, and
expiration,  and  the  respective rights, limitations, obligations and duties of
the  Company  and  each Holder which will be established upon any such issuance;
and  to  make  each Warrant when represented by a Certificate that has been duly
executed  by the Company (or by any substitute or replacement Certificate issued
under  the  terms  set  forth below), the valid, binding and legally enforceable
obligation  of  the  Company.

     Accordingly,  the  Company  and  the  Holders  hereby  agree  as  follows:

<PAGE>
                              OPERATIVE PROVISIONS
                              --------------------

1.   Issuance.  The Company shall issue Warrant Certificates to purchase  up  to
     an  aggregate of 4,600,000 shares of Common Stock (each applicable exercise
     price  shall  be referred to herein as the "EXERCISE PRICE" with respect to
     each  Warrant  Certificate,  as  applicable).

2.   Warrant  Certificates.  Each  Certificate  to be delivered pursuant to this
       ---------------------
     Agreement  shall  be  in  the  form  set  forth  in Exhibit A (the "WARRANT
     CERTIFICATE")  which  is  attached hereto and made a part hereof, with such
     appropriate  insertions,  omissions,  substitutions and other variations as
     are  required  or  permitted  by  this  Agreement.

3.   Warrants  Governed by Agreement.  This  Warrant  Agreement governs an issue
     -------------------------------
     of up to an aggregate of 4,600,000 Warrants, each of which will entitle its
     Holder  to  purchase  one  Warrant  Share  on  the terms and subject to the
     conditions  and  possible  adjustments  set  forth herein. The Warrants are
     vested  in  full  and  may  be exercised, in whole or in part, from time to
     time,  in  accordance  with  the  terms of this Agreement and the Warrants.

4.   Execution  and  Date  of  Warrant  Certificates.
     -----------------------------------------------

     a.   General.  Each  Certificate shall be executed on behalf of the Company
          -------
          by  its  chief executive officer, its president or any vice president,
          under  its  corporate  seal  which  will  be  reproduced  thereon, and
          attested  by  its  corporate  secretary  or  one  of  its  assistant
          secretaries.

     b.   Date of Certificate. Each Certificate shall be dated as of the date of
          -------------------
          execution  by  the  Company  officers  described  above.

5.   Ownership.  The  Company  shall  acknowledge  each  registered  Holder of a
     ---------
     Warrant  Certificate  as  the  absolute  owner thereof (notwithstanding any
     notation  of  ownership  or  other  writing  thereon  made  by  anyone), in
     connection  with  its  sale,  transfer or exercise, any distribution to the
     holder  thereof  and for all other purposes, and, subject to the provisions
     of Section 11 below, the Company shall not be affected by any notice to the
     contrary.

6.   Exercise  of  Warrants.
     ----------------------

     a.   Expiration  Date.  Each  Warrant  shall  expire  at 5:00 p.m., Pacific
          ----------------
          Standard  Time, on June 30, 2006, and, prior thereto, may be exercised
          at  any  time  after  the  Effective Date, provided, however, that the
          Holder of the Warrants must give not less than 90 days prior notice to
          the Company prior to any exercise of such Warrant. For purposes of the
          Warrant  Agreement,  the term "EFFECTIVE DATE" shall refer to the date
          of  issuance  of  such  Warrant.

     b.   Exercise  Price  and  Payment.  Subject  to  the  provisions  of  this
          -----------------------------
          Agreement,  the  Holder  shall  have  the  right  to purchase from the
          Company  (and  the  Company  shall issue and sell to such Holder) that

<PAGE>
          number  of  fully  paid  and  non-assessable  Warrant  Shares,  at the
          Exercise  Price  (as stated in the applicable Warrant Certificate) and
          as  shall  be  designated  in  a  completed  and  executed Election to
          Purchase  form  appearing on the reverse side of each Certificate, and
          upon  surrender to the Company of the Certificate evidencing each such
          Warrant being exercised, and payment of a monetary amount equal to the
          product  of  the Exercise Price and the number of Warrant Shares being
          purchased (the "Exercise Price Multiple"). The Exercise Price Multiple
          may  be  paid  in  cash, check, or by certified or official bank check
          payable  to  the  order  of  the  Company,  or by "cashless" or "easy"
          exercise,  as  set  forth  below.

     c.   Easy  Exercise.  In  the event the Warrant Shares have been registered
          --------------
          on  a  then effective registration statement, or if the Warrant Shares
          are  otherwise not "restricted securities" under the Securities Act of
          1933,  as  amended, and if permitted by law and applicable regulations
          (including  Nasdaq  and  NASD  rules), the Holder may pay the exercise
          price through a commitment from the Holder and a broker-dealer that is
          a  member  of  the National Association of Securities Dealers (a "NASD
          Dealer"),  whereby  the Holder irrevocably elects to exercise all or a
          portion  of  the  Warrants and to sell in an orderly manner as soon as
          possible  the Warrant Shares issuable pursuant to such exercise and to
          pay  the Exercise Price Multiple. The Holder and the NASD Dealer shall
          irrevocably  commit  upon  sale  of such Warrant Shares to forward the
          Exercise Price Multiple directly to the Company. All proceeds of sales
          of  the  Warrant Shares shall be assigned to the Company to secure the
          obligation  to  pay the Exercise Price Multiple, and all such proceeds
          shall  be  remitted  directly to the Company until such Exercise Price
          Multiple  has  been  paid  in  full.

     d.   In  the  event  the  Warrant Shares then issuable upon exercise of the
          Warrants are not registered as described in Section 6(c) above, or are
          in  any  way "restricted" securities (including any restriction in the
          volume  and  manner  of  sales  pursuant to Rule 144), than in lieu of
          exercising the Warrants or any portion thereof, the Holder or Holders,
          if  applicable,  shall  have the right to convert the Warrants, or any
          portion  thereof,  into  Warrant Shares by executing and delivering to
          the  Company,  at  its  principal  executive  office,  a duly executed
          Election  to  Purchase  Form,  specifying the number of Warrants to be
          converted,  and  accompanied  by  the  surrender of such Warrants. The
          person  or  persons  in  whose  name or names the certificates for the
          Warrant  Shares shall be issuable upon such conversion shall be deemed
          the  holder  or  holders of record of such Warrant Shares at that time
          and  date.  The  number  of  Warrant  Shares  to  be  issued upon such
          conversion  shall  be  computed  using  the  following  formula:

     X =  (P)(Y)((A-B)/A)
     X =  the  number  of  Warrant  Shares  to  be issued to such Holder for the
          percentage  of  Warrants  being  converted
     P =  the  percentage  of  the  Warrants  being  converted

<PAGE>
     Y =  the  total  number  of  Warrant  Shares then issuable upon exercise of
          the  Warrants
     A =  the  Fair  Value  (as  defined  below)  of  one  Warrant  Share
     B =  the  Exercise  Price  on  the  date  of  conversion

     e.   Within  three  (3)  business  days  following  such  surrender  of  a
          Certificate  and payment of the Exercise Price Multiple (except in the
          case of an "easy exercise" as described in subsection 6(d) above), the
          Company shall cause to be issued and delivered promptly to the Holder,
          or,  upon  the  written order of the Holder, in such other name as the
          Holder  may  designate,  a  certificate  for  the Warrant Shares being
          purchased,  as  evidenced  by  the  Election to Purchase. Such Warrant
          Share  certificate  shall be deemed to have been issued and any person
          so  designated  to be named therein shall be deemed to have become the
          Holder  of  such  Shares  as  of  the  date  of  the  surrender of the
          applicable Certificate and payment of the Exercise Price Multiple. The
          Warrants  evidenced  by  a  Certificate  shall  be exercisable, at the
          election of the Holder, either as an entirety or from time to time for
          only  part  of the number of Warrants specified in the Certificate. In
          the  event  that  less  than  all  of  the  Warrants  evidenced  by  a
          Certificate surrendered upon the exercise of Warrants are exercised at
          any  time  prior  to  the  date  of  expiration of the Warrants, a new
          Certificate  shall  be  issued  for  the  remaining number of Warrants
          evidenced  by  the  Certificate  so  surrendered.  All  Certificates
          surrendered  upon  exercise  of  Warrants  shall  be  canceled  by the
          Company.

     f.   No  Fractional  Shares  to be Issued.  No fraction of a Share shall be
          ------------------------------------
          issued upon any exercise of Warrants, but, in lieu thereof, the number
          of  shares  issuable upon exercise of the Warrants shall be rounded up
          to  the  nearest  full  share  of Common Stock. No fractional Warrants
          shall  be  issued.

     g.   In  the event of a breach of this Agreement by the Company, or a delay
          or  other failure to issue, transfer or clear the Warrant Shares under
          the  terms  hereof,  or a failure of the Company to promptly authorize
          the  Company's  transfer  agent  to  remove  restrictive  legends  as
          permitted  by law or clear any transfer permitted by law, or any other
          breach  of  any  obligation  of  the  Company  which has the effect of
          delaying  the ability of the Holder to sell any Warrant Shares without
          restriction  in  an  open  market transaction which would otherwise be
          permitted  by  law  (a "Transfer Breach"), would result in substantial
          damages  to  the  Holder. Such damages are impracticable and extremely
          difficult to ascertain under the circumstances existing as of the date
          of  this  Agreement.  In  the  event  the  Company  intentionally  or
          negligently  commits a Transfer Breach, or otherwise delays or impedes
          the  issuance,  clearance  or  transfer  of Warrant Shares within five
          business  days  after a written request therefor has been delivered to
          the  Company (the "Certificate Request"), the Company agrees to pay to
          the  Holder or its assignee or designee an amount equal to the greater
          of  (i)  $1,000 per business day for each 500,000 Warrant Shares owned
          by  the  Holder  (including,  without  limitation,  Warrant  Shares
          previously  issued  upon  exercise  of  Warrants (but not yet sold) or

<PAGE>
          issuable  upon  exercise  of  any then outstanding Warrants), (ii) the
          product  of (x) the last sale price of the Common Stock as reported on
          any  securities  market  or  exchange  designated by Holder (the "Last
          Reported Sale Price") on the date the certificates are properly issued
          and delivered to the Holder or its assignee or designee, less the Last
          Reported  Sales  Price  on  the  date  of  the  Certificate  Request,
          multiplied  by  (y) the number of Warrant Shares beneficially owned by
          such  Holder, including, without limitation, Warrant Shares previously
          issued  upon  exercise of Warrants (but not yet sold) or issuable upon
          exercise  of  any  then  outstanding  Warrants  ("Warrant  Shares
          Beneficially  Owned"),  or (iii) the quotient of (x) the Last Reported
          Sale  Price  on  the day prior to the date of the Certificate Request,
          multiplied  by  the number of Warrant Shares Beneficially Owned by the
          Holder,  divided  by  (y) 200 (the "Delay Damages"), for each business
          day  after  the  fifth  business  day  following  the  delivery of the
          Certificate  Request to the Company through and including the day such
          certificates  (without  legend  or  restriction)  are delivered to the
          Holder  or  its  assignee or designee at the address set forth in such
          Certificate  Request  or  are  otherwise  cleared  or transferred. THE
          LIQUIDATED DAMAGES AS DESCRIBED HEREIN REPRESENT A REASONABLE ESTIMATE
          OF  DAMAGES.  THE PAYMENT OF SUCH AMOUNT AS LIQUIDATED DAMAGES FOR THE
          BREACH  OF  THIS  PARAGRAPH IS NOT INTENDED AS A FORFEITURE OR PENALTY
          WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT
          IS  INTENDED  TO  CONSTITUTE LIQUIDATED DAMAGES PURSUANT TO CALIFORNIA
          CIVIL  CODE SECTION 1671, 1676, AND 1677. THE LIQUIDATED DAMAGES SHALL
          CONSTITUTE  THE  SOLE AND EXCLUSIVE REMEDY FOR THE COMPANY'S BREACH OF
          THIS AGREEMENT AS DESCRIBED HEREIN. IN THE EVENT THE COMPANY RESTRICTS
          OR DELAYS THE TRANSFER OR CLEARANCE OF SUCH CERTIFICATES BY THE HOLDER
          OR  ITS  ASSIGNEE  OR  DESIGNEE  (WHETHER  BY  STOP  TRANSFER  ORDER,
          UNREASONABLE  DELAY OR OTHERWISE), THE COMPANY SHALL PAY TO THE HOLDER
          OR ITS ASSIGNEE OR DESIGNEE THE DELAY DAMAGES FOR EACH BUSINESS DAY OF
          SUCH  RESTRICTION  OR  DELAY.  To  the  extent necessary to effect the
          foregoing,  the Company agrees (i) to file in a timely manner and keep
          current  information  on  file  with  the  Securities  and  Exchange
          Commission  as  provided  in  Rule  144(c)  and  (ii)  to  keep  any
          registration  statement pursuant to which the Warrant Shares have been
          registered  for  resale  under the Securities Act current. The parties
          have  set  forth their initials below to indicate their agreement with
          the  liquidated  damage  provision  in  this  paragraph.

               THE  COMPANY           THE  HOLDER

                   JG                     GH
               -----------            ----------
               INITIALS               INITIALS

7.   Payment  of  Taxes.  The  Company  will  pay  all  documentary  stamp taxes
     ------------------
     attributable  to  the  initial  issuance  of  Shares  upon  the exercise of
     Warrants;  provided  that the Company shall not be required to pay any such
     taxes which may be payable in respect of any transfer involved in the issue
     of  any  Certificates  or  any certificates for Shares in a name other than
     that  of  the  Holder  of  a Certificate surrendered upon the exercise of a
     Warrant.

<PAGE>
8.   Reservation  and Issuance of Shares.  The Company will at all times reserve
     -----------------------------------
     and  keep  available,  free from preemptive rights, out of the aggregate of
     its  authorized  but  unissued shares of Common Stock or its authorized and
     issued  shares  of  Common  Stock  held in its treasury, for the purpose of
     enabling it to satisfy any obligation to issue Warrant Shares upon exercise
     of  Warrants,  the  full  number  of  Warrant  Shares  deliverable upon the
     exercise  of all outstanding Warrants. Before taking any action which would
     cause  an  adjustment  pursuant  to  Section 10 reducing the Exercise Price
     below  the  then  par  value  (if  any) of the Warrant Shares issuable upon
     exercise  of the Warrants, the Company will take any corporate action which
     may,  in the opinion of its counsel, be necessary in order that the Company
     may  validly and legally issue fully paid and non-assessable Warrant Shares
     at  the  Exercise  Price  as  so  adjusted.  The Company covenants that all
     Warrant  Shares  which  may  be  issued  upon  exercise of Warrants will be
     validly issued, fully paid and non-assessable outstanding Warrant Shares of
     the  Company  or  any  successor.

9.   Mutilated  or  Missing Warrant Certificates.  In case any Certificate shall
     -------------------------------------------
     be  mutilated,  lost,  stolen  or  destroyed,  the  Company  shall issue in
     exchange  and  substitution  for  and  upon  cancellation  of the mutilated
     Certificate,  or  in  lieu  of  and  substitution for the Certificate lost,
     stolen or destroyed, a new Certificate, of the same series and representing
     an  equivalent  right  or  interest,  but  only  upon  receipt  of evidence
     satisfactory  to  the  Company  of  such loss, theft or destruction of such
     Certificate  and  indemnity,  if  requested,  also  satisfactory  to  it.
     Applicants  for  such  substitute  Certificates shall also comply with such
     other  reasonable  regulations and pay such other reasonable charges as the
     Company  may  prescribe.

10.  Adjustment  of  Exercise  Price  and  Number  of  Shares Purchasable.  The
     --------------------------------------------------------------------
     Exercise  Price  and  the  number  of  Warrant  Shares purchasable upon the
     exercise of each Warrant are subject to adjustment from time to time as set
     forth  in  this  Section  10.

     a.   Decrease  or  Increase  in  Exercise  Price  Upon  Subdivision  or
          ------------------------------------------------------------------
          Combination. If the Company shall at any time subdivide or combine the
          -----------
          outstanding  shares  of its Common Stock, the Exercise Price in effect
          immediately  prior  to  such  subdivision  or  combination  shall  be
          proportionately increased in the case of a combination or decreased in
          the  case  of a subdivision, effective at the close of business on the
          date  of  such  subdivision  or  combination,  as  the  case  may  be.

     b.   Adjustment  in  Number  of Shares Upon Change of Exercise Price.  Upon
          ---------------------------------------------------------------
          each  adjustment  of  the  Exercise  Price  pursuant  to Section 10(a)
          hereof,  each  Holder shall thereafter (until another such adjustment)
          be entitled to purchase, at the adjusted Exercise Price, the number of
          shares of Common Stock, calculated to the nearest full share, obtained
          by  multiplying  the  number  of  shares  of  Common Stock purchasable
          hereunder  immediately  prior to such adjustment by the Exercise Price
          in  effect  immediately  prior  to  such  adjustment  and dividing the
          product  so  obtained  by  the  adjusted  Exercise  Price.

<PAGE>
     c.   Merger.  If  the  Company,  at  any  time  while  any  Warrants remain
          ------
          outstanding  and  unexpired,  consolidates with or merges into or with
          any  other  corporation,  the  Warrants  shall thereafter evidence the
          right  of  the Holder to purchase the number and kind of securities in
          respect  of  the  surviving corporation as would have been issuable or
          distributable  to  the  Holder  had  he,  she  or  it  exercised  the
          unexercised  portion  of  the  Warrants  immediately  prior  to  such
          consolidation  or  merger.

     d.   Distribution  of  Company  Assets.  If  the  Company  shall  make  any
          ---------------------------------
          distribution  of  its  assets  to the holders of its Common Stock as a
          partial  or  complete  liquidating  dividend,  a  return of capital or
          otherwise,  each  Holder  shall  be  entitled, after occurrence of the
          record  date  for  determining  shareholders  entitled  to  such
          distribution,  but  before  the date of such distribution, to exercise
          any  Warrants  then  owned  and  purchase  any or all of the shares of
          Common  Stock then subject hereto, and thereupon to receive the amount
          of  such  assets  (or  at the option of the Company a sum equal to the
          value  thereof  at  the time of such distribution to holders of Common
          Stock as such value is determined in good faith by the Company's Board
          of Directors) which would have been payable to such Holder had he, she
          or  it been the holder of record of such shares of Common Stock on the
          referenced  record  date.

11.  Transfer  Restrictions.  The Holder acknowledges that neither this  Warrant
     ----------------------
     nor  the  Warrant  Shares  may  be  offered  or  sold except pursuant to an
     effective  registration  statement  under  the  Securities Act or a written
     opinion  of  counsel  satisfactory  to  the  Company that an exemption from
     registration under the Securities Act is available. Each Holder agrees that
     prior  to making any disposition of the Warrant or Warrant Shares, unless a
     registration  statement  under  the Securities Act is in effect with regard
     thereto,  the  Holder  shall  give written notice to the Company describing
     briefly  the  manner  in which any such proposed disposition is to be made,
     along with an opinion of counsel satisfactory to the Company which provides
     that  no  registration  statement  or  other notification or post-effective
     amendment  thereto  (hereinafter  collectively  a "REGISTRATION STATEMENT")
     under  the  Securities  Act  is  required with respect to such disposition.

12.  Transfer  -  General.  Subject  to the terms hereof,  the Warrants shall be
     --------------------
     transferable  only  on the books of the Company maintained at its principal
     office  upon  delivery  thereof  duly endorsed by the Holder or by his duly
     authorized attorney or representative, or accompanied by proper evidence of
     succession,  assignment  or authority to transfer. In all cases of transfer
     by  an  attorney,  the original power of attorney, duly approved, or a copy
     thereof, duly certified, shall be deposited and remain with the Company. In
     case  of  transfer  by  executors, administrators, guardians or other legal
     representatives,  duly  authenticated  evidence of their authority shall be
     produced,  and  may  be  required  to  be  deposited and to remain with the
     Company in its discretion. Upon any registration of transfer, the person to
     whom  such  transfer  is made shall receive a new Warrant or Warrants as to
     the  portion  of  the  Warrant  transferred, and the Holder of such Warrant
     shall  be entitled to receive a new Warrant or Warrants from the Company as
     to  the  portion thereof retained. The Company may require the payment of a
     sum  sufficient to cover any tax or governmental charge that may be imposed
     in  connection  with  any  such  transfer.

<PAGE>
13.  Piggyback  Registration  Rights.
     -------------------------------

     a.   In case the Company shall at any time determine to register any of its
          securities  under  the Securities Act, other than by way of Securities
          and  Exchange  Commission  (the "COMMISSION") Forms S-4 or S-8, or any
          successor  form  thereto, at its own initiative, the Company will give
          prompt notice thereof to the Holder, and if so requested in writing by
          any person to which such notice shall have been properly provided, the
          Company  will  include among the securities which it then endeavors to
          make  the  subject  of  a registration statement to be filed under the
          Securities Act, or to qualify under such state securities laws, all or
          any  part  of  such  previously  issued  shares, or of the shares then
          eligible  for  issuance  upon  exercise  of  the  Warrants as shall be
          specified  in  such request (the "DESIGNATED SHARES"), and the Company
          will  use  its  best  efforts  to  cause  all  such  registrations,
          qualifications  or compliances to be effected and to be kept effective
          for  not  less  than  90  days.

     b.   Notwithstanding  the  foregoing,  if at any time after the date hereof
          the  Company files a registration statement with respect to any of its
          securities in connection with a bona fide underwritten public offering
          of the same, then (a) any Designated Shares which shall have been made
          the  subject  of  a  registration  statement  filed for the purpose of
          qualifying  shares  under  the Securities Act for future sale or which
          are,  in  connection with such a registration, being or to be included
          pursuant  to  Section  13,  shall,  if  so  requested  by the managing
          underwriter(s)  and  consented  to  by  each  applicable  holder  of
          Designated Shares, be offered for sale through the underwriters on the
          same  terms and conditions under which the Company's securities are to
          be  distributed, provided that if the managing underwriter(s) elect to
                           --------
          include  less  than  all  Designated  Shares  to be offered by selling
          shareholders,  those to be included in the underwritten portion of the
          offering  shall  be,  as  to  each  holder thereof, as nearly equal in
          number  as  is  practicable; and (b) those Designated Shares which are
          not  being  distributed  by  the  underwriters in such public offering
          shall  be  withheld  from the market by the selling shareholders for a
          period,  not  to  exceed 180 days, measured from the effective date of
          the  registration  statement  by  which  such public offering is being
          effected,  which  the  managing  underwriter(s) determine necessary in
          order  to  stabilize  the  market  for  the  underwritten  shares.
          Notwithstanding  the foregoing, in the event in the written opinion of
          such  managing  underwriter(s),  the  Designated  Shares  may  not  be
          included  in  the  registration  statement  without  having a material
          adverse  effect  on  the  Company's  offering  of  it  securities, the
          managing  underwriter(s)  shall  have the right to eliminate or reduce
          the  number  of  Designated  Shares proportionately among the Holders.

<PAGE>
     c.   All  expenses  incurred  in  connection  with  any  registration,
          qualification  or  compliance  effected  by  the  Company  pursuant to
          Section 13, including, without limitation, all registration and filing
          fees, fees and expenses of complying with federal and state securities
          laws,  printing  expenses,  fees  and disbursements of counsel for the
          Company,  and  all  expenses  of  any  special audits incidental to or
          required  by  such  registration  (collectively,  the  "REGISTRATION
          EXPENSES") shall be borne by the Company, provided that each holder of
          Designated  Shares  shall  be  responsible  for  that  portion  of any
          underwriting  commission  incurred in connection with the underwritten
          distribution  of  the securities made the subject of such registration
          effort as shall bear the same ratio to such commission as the value of
          the  Designated Shares sold by the holder in the offering bears to the
          value  of  all  Company  securities  sold  in  such  offering.

     d.   Indemnification  by  the  Company:  In  case  of  each  registration,
          ---------------------------------
          qualification  or  compliance  effected  by  the  Company  pursuant to
          Section  13,  the Company will indemnify and hold harmless each holder
          of  Designated Shares from and against all claims, losses, damages and
          liabilities  of  such  holder  arising  out  of or based on any untrue
          statement  (or  alleged untrue statement) of a material fact contained
          in  any  prospectus  or  other document incident to such registration,
          qualification  or  compliance  or  any  omission  to  state  therein a
          material  fact  required to be stated therein or necessary to make the
          statements therein not misleading, or necessary to make the statements
          therein, in light of the circumstances under which they were made, not
          misleading,  or any violation by the Company of any rule or regulation
          promulgated under the Securities Act or the Exchange Act applicable to
          the Company and relating to action or inaction required of the Company
          in connection with any such registration, qualification or compliance;
          provided that the Company will not be liable to any such person to the
          extent that any such claim, loss, damage or liability arises out of or
          is  based  on  any  untrue  statement  or  omission based upon written
          information furnished to the Company by an instrument duly executed by
          such  person  and  stated  to  be  specifically  for  use  therein.

     e.   Indemnification  by  the  Holders.  Each  Holder hereby agrees, and by
          ---------------------------------
          requesting registration of Designated Shares, each Holder agrees, that
          in  connection  with  each  registration  statement  effected pursuant
          hereto  in  which  Common  Stock  issued  upon  exercise of all or any
          portion  of the Warrants (the "Holder Common Stock") is to be disposed
          of,  each  of  the  participating  Holders  shall,  severally  but not
          jointly,  indemnify and hold harmless, to the fullest extent permitted
          by  law,  the  Company, each other selling Holder and their respective
          directors, officers, agents and employees and each person who controls
          the  Company  and each other selling Holder (within the meaning of the
          Securities  Act  and the Exchange Act) and the managing underwriter if
          any,  and  its  directors,  officers,  agents,  and employees and each
          person  who  controls  such  underwriter  (within  the  meaning of the
          Securities  Act  and  Exchange  Act), in each case against any losses,
          claims,  damages,  liabilities  and expenses resulting from any untrue
          statement  of  a  material  fact  or  any  omission of a material fact

<PAGE>
          required  to be stated in such registration statement or prospectus or
          preliminary prospectus or necessary to make the statements therein not
          misleading,  to  the  extent that such untrue statement or omission is
          contained  in  any information furnished by such Holder to the Company
          expressly  for inclusion in such registration statement or prospectus.

     f.   Conduct  of  Indemnification  Proceedings.  Any  person  entitled  to
          -----------------------------------------
          indemnification hereunder shall give prompt notice to the indemnifying
          party of any claim with respect to which it shall seek indemnification
          and shall permit such indemnifying party to assume the defense of such
          claim  with  counsel reasonably satisfactory to the indemnified party;
          provided,  however,  that  any  person  entitled  to  indemnification
          --------
          hereunder  shall  have  the  right  to  employ separate counsel and to
          participate in the defense of such claim, but the fees and expenses of
          such  counsel  shall  be  at the expense of such person unless (i) the
          indemnifying  party shall have agreed to pay such fees or expenses, or
          (ii) the indemnifying party shall have failed to assume the defense of
          such  claim  and  to  employ  counsel  reasonably satisfactory to such
          person or (iii) such assumption would constitute an actual conflict of
          interest (in which case, if the person notifies the indemnifying party
          in  writing  that such person elects to employ separate counsel at the
          expense  of  the  indemnifying party, the indemnifying party shall not
          have  the  right to assume the defense of such claim on behalf of such
          person). If such defense is not assumed by the indemnifying party, the
          indemnifying  party  shall  not  be  subject  to any liability for any
          settlement  made  without  its  consent (but such consent shall not be
          unreasonably  withheld).  No  indemnified  party  shall be required to
          consent  to  entry  of  any judgment or enter into any settlement that
          does  not  include  as an unconditional term thereof the giving by the
          claimant  or  plaintiff to such indemnified party of a written release
          in  form  and  substance  reasonably  satisfactory to such indemnified
          party  from  all  liability in respect of such claim or litigation. An
          indemnifying  party  who  is not entitled to, or elects not to, assume
          the  defense  of  a  claim  shall not be obligated to pay the fees and
          expenses  of  more  than one firm of counsel (and, if necessary, local
          counsel)  for  all parties indemnified by such indemnifying party with
          respect to such claim, unless a conflict of interest as to the subject
          matter  exists  between such indemnified party and another indemnified
          party  with  respect  to  such  claim, in which event the indemnifying
          party  shall  be  obligated to pay the fees and expenses of additional
          counsel  for  such  indemnified  party.

     g.   Contribution.  If  for  any  reason  the  indemnification provided for
          ------------
          herein  is  unavailable  to an indemnified party or is insufficient to
          hold  it  harmless as contemplated hereby, then the indemnifying party
          shall  contribute  to  the  amount  paid or payable by the indemnified
          party  as  a  result  of such loss, claim, damage or liability in such
          proportion as is appropriate to reflect not only the relative benefits
          received by the indemnified party and the indemnifying party, but also
          the  relative  fault  of  the  indemnified  party and the indemnifying
          party,  as  well  as  any  other  relevant  equitable  considerations,

<PAGE>
          provided  that  in no event shall the liability of any Holder for such
          contribution  and indemnification exceed, in the aggregate, the dollar
          amount  of the proceeds received or to be received by such Holder upon
          the  sale  of  securities  giving  rise  to  such  indemnification and
          contribution  obligation.

     h.   The  Company may require each selling Holder to furnish to the Company
          such  information  and documents regarding such selling Holder and the
          distribution  of  such securities as the Company may from time to time
          reasonably  request  in writing in order to comply with the Securities
          Act.

     i.   Each  of  the  selling Holders agrees that, upon receipt of any notice
          from  the  Company of the happening of any event which would cause any
          then  effective  registration  statement  to  be inaccurate, no longer
          effective,  subject  to  a  stop  order  issued  by the Securities and
          Exchange  Commission,  or  which  would  otherwise  require  by law or
          regulation  that  such  selling  Holders  to  discontinue  sales  of
          securities  under  such  registration  statement,  it  will  forthwith
          discontinue disposition pursuant to such registration statement of any
          shares  of  Common  Stock  covered  by  such registration statement or
          prospectus  until  its  receipt  of  the  copies  of a supplemented or
          amended  prospectus  relating  to  such  registration  statement  or
          prospectus  or  until it is advised in writing by the Company that the
          use of the applicable prospectus may be resumed and, if so directed by
          the  Company,  will  deliver  to  the  Company  all copies, other than
          permanent  file  copies  then  in  their possession, of the prospectus
          covering  such  securities  in  effect  at the time of receipt of such
          notice.

     j.   The  obligations of the Company to use its reasonable efforts to cause
          the  Holder Common Stock to be registered under the Securities Act are
          subject  to  each  of  the  following  limitations,  conditions  and
          qualifications:

          i.   The  Company  shall be entitled to abandon, discontinue, withdraw
               or  postpone  for  any period of time the filing or effectiveness
               of,  or  suspend  the  rights  of  selling  Holders to make sales
               pursuant  to, any registration statement otherwise required to be
               prepared,  filed  and  made and kept effective by it hereunder if
               the  Board  of  Directors of the Company reasonably determines in
               good  faith  that (i) there is a material undisclosed development
               in  the business or affairs of the Company (including any pending
               or  proposed  financing,  recapitalization,  acquisition  or
               disposition),  the  disclosure  of  which  at  such time would be
               adverse  to  the  Company's  interests  or  (ii)  such  filing or
               effectiveness  would  be  disadvantageous  to  the Company or its
               shareholders.

          ii.  The Company's obligations shall be subject to the obligations of
               the  selling  Holders,  which  each  of  the  Holders  hereby
               acknowledges,  to  furnish  all  information and materials and to
               take  any  and  all  actions  as may be required under applicable

<PAGE>
               federal  and  state securities laws and regulations to permit the
               Company to comply with all applicable requirements of the SEC and
               state  securities  regulations  and to obtain any acceleration of
               the effective date of such registration statement or maintain the
               effectiveness  or  currency  thereof.

          iii. If  requested  by  an  underwriter in an  underwritten  offering,
               each Holder agrees not to effect any public sale or distribution,
               including any sale pursuant to Rule 144 under the Securities Act,
               of  any  Common  Stock within 30 days before or 60 days after the
               effective  date  of  a  registration  statement filed pursuant to
               Section  13.

14.  Miscellaneous  Provisions.
     -------------------------

     a.   Limitation  of  Rights  Conferred.  This  Warrant  Agreement  does not
          ---------------------------------
          confer  upon  any  Holder  of  a  Warrant  Certificate  any right as a
          shareholder  of  the  Company,  nor shall anything contained herein be
          deemed  to  affect  the  right  or  power  of  the  Company  to  make
          adjustments,  reclassifications,  reorganizations other changes in and
          to its capital stock or business organization or to limit its right to
          merge or consolidate or to sell, transfer or liquidate all or any part
          of  its  business  or  assets.

     b.   Notices:  All notices or other communications required or permitted to
          -------
          be  given  pursuant to this Agreement shall be in writing and shall be
          considered  as  properly  given or made if hand delivered, mailed from
          within  the  United States by certified or registered mail, or sent by
          prepaid  telegram:

               if  to  the  Company:

                    Emergent  Financial  Group,  Inc.
                    3550  N.  Central  Avenue,  Suite  1800
                    Phoenix,  Arizona  85012
               Attention:  President

                    if  to  a  Holder,  in  care of the address set forth in the
               Company's records established at the time of the Holder's receipt
               of  a  Certificate,

                    or  to  such  other  address  as  any  such  party  may have
               designated  by  like  notice forwarded to the other party hereto.
               Notwithstanding the foregoing, notices of change of address shall
               be  furnished  only  when  received.

15.  Governing  Law  and  Jurisdiction.  This  Agreement  and  the  rights  and
     ---------------------------------
     obligations  of  the  parties under this Agreement shall be governed by and
     construed  and  interpreted  in  accordance  with  the laws of the State of
     California,  without regard to the principles of conflicts of laws thereof.
     In  the  event  of  litigation,  the  prevailing party shall be entitled to

<PAGE>
     reasonable  attorneys  fees  and  costs.  Any controversy arising hereunder
     shall  be  resolved  in  the state or federal courts sitting in Los Angeles
     County, California. In the event a Holder alleges in any complaint that the
     Company  has committed or permitted to exist a Transfer Breach, the Company
     shall,  within  30 days following service of such complaint on the Company,
     provide  a  bond,  which  shall  be  payable to the plaintiffs in the event
     judgment is entered in their favor, up to the amount of such judgment. Such
     bond  shall be in an amount equal to the product of the Last Reported Sales
     Price on the date of the applicable Certificate Request (or the date of the
     filing  of  the  complaint,  if  no  Certificate  Request  was  delivered),
     multiplied  by  the  number  of  Warrant  Shares  Beneficially Owned by the
     Holders  who  are  plaintiffs  in  such complaint. The Holders shall not be
     required  to  post  any  bond.

     WAIVER  OF  JURY  TRIAL. THE COMPANY AND THE HOLDERS HEREBY IRREVOCABLY AND
     UNCONDITIONALLY  WAIVE  TRIAL  BY  JURY  IN  ANY LEGAL ACTION OR PROCEEDING
     RELATING  TO  THIS  AGREEMENT  OR  FOR  ANY  COUNTERCLAIM  THEREIN.

16.  Supplements  and Amendments.  The  Company may from time to time supplement
     ---------------------------
     or  amend  this  Agreement  in order to cure any ambiguity or to correct or
     supplement  any  provision  contained  herein  which  may  be  defective or
     inconsistent  with  any  other  provision  herein,  or  to  make  any other
     provisions  in  regard  to matters or questions arising hereunder which the
     Company may deem necessary or desirable and which shall not be inconsistent
     with  the  provisions  of the Warrants and which shall not adversely affect
     the  interests  of  the  Holders.

17.  Successors and Assigns.  This Agreement shall be binding upon and inure to
     ----------------------
     the  benefit of the Company and the Holders and their respective successors
     and  assigns.

18.  Merger  or  Consolidation  of the Company.  So long as the Warrant remains
     -----------------------------------------
     outstanding,  the  Company  will  not merge or consolidate with or into, or
     sell,  transfer  or  lease all or substantially all of its property to, any
     other  corporation  unless  the successor or purchasing corporation, as the
     case  may  be (if not the Company), shall expressly assume, by supplemental
     agreement,  the  due  and  punctual  performance and observance of each and
     every covenant and condition of this Agreement to be performed and observed
     by  the  Company.

19.  Benefits  of this Agreement.  Nothing in this Agreement shall be construed
     ---------------------------
     to  confer  upon  any  person  other  than the Company, the Holders and any
     successors,  assignees,  transferees or designees of the Holders, any legal
     or equitable right, remedy or claim under this Agreement and this Agreement
     shall be for the sole and exclusive benefit of the Company, the Holders and
     any  successors,  assignees,  transferees  or  designees  of  the  Holders.

20.  Captions.  The  captions  of  the  Sections  of  this  Agreement have been
     --------
     inserted  for  convenience  only  and  shall  have  no  substantive effect.

<PAGE>
21.  Counterparts.  This  Agreement  may  be  executed  in  any  number  of
     ------------
     counterparts  (including  by telecopy) each of which when so executed shall
     be  deemed  to be an original; and all of which counterparts together shall
     constitute  one  and  the  same  instrument.

22.  Limitation  of  Liability.  No  provision  hereof,  in  the  absence  of
     -------------------------
     affirmative action by any Holder to purchase shares of Common Stock, and no
     enumeration  herein of the rights or privileges of any Holder of a Warrant,
     shall  give  rise to any liability of such Holder for the purchase price of
     any Common Stock or as a shareholder of the Company, whether such liability
     is  asserted  by  the  Company  or  by  the  creditors  of  the  Company.

23.  No  Waiver;  Cumulative  Remedies.  No failure to exercise and no delay in
     ---------------------------------
     exercising,  on  the  part of any Holder or the Company, any right, remedy,
     power  or  privilege hereunder shall operate as a waiver thereof, nor shall
     any  single  or  partial  exercise or any right, remedy, power or privilege
     hereunder preclude any other or further exercise thereof or the exercise of
     any  other  right, remedy, power or privilege. The rights, remedies, powers
     and  privileges  herein  provided  are  cumulative and not exclusive of any
     rights,  remedies,  powers  and  privileges  provided  by  law.

24.  Compliance  with  Governmental  Regulations.  The Holder acknowledges that
     -------------------------------------------
     none  of  the  Warrants  or  Warrant  Shares have been registered under the
     Securities  Act,  and therefore may be sold or disposed of only pursuant to
     an  effective  registration  statement  under  the  Securities  Act,  or an
     exemption  from  such  registration, and in accordance with this Agreement.
     The  Warrant  Shares  will  bear  a  legend  to  the  following  effect:

          "THE  SECURITIES  REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE
          SECURITIES  AND  EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933,
          AS  AMENDED,  OR WITH THE SECURITIES COMMISSION OF ANY STATE UNDER ANY
          APPLICABLE  STATE  SECURITIES  OR BLUE SKY LAWS AND ARE SUBJECT TO THE
          WARRANT  AGREEMENT,  DATED  AS  OF  AUGUST  28,  2001,  AMONG EMERGENT
          FINANCIAL  GROUP,  INC. AND THE ORIGINAL HOLDER HEREOF (A COPY OF EACH
          SUCH AGREEMENT IS ON FILE WITH THE SECRETARY OF THE COMPANY AND MAY BE
          OBTAINED  UPON  WRITTEN  REQUEST  TO  THE  COMPANY).  THE  SECURITIES
          REPRESENTED  HEREBY  MAY  NOT  BE SOLD OR OTHERWISE TRANSFERRED EXCEPT
          PURSUANT  TO  AN  EFFECTIVE REGISTRATION STATEMENT OR IN A TRANSACTION
          EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THOSE SECURITIES LAWS AND
          UPON  PROVISION  OF  AN OPINION OF COUNSEL IN FORM SATISFACTORY TO THE
          COMPANY."

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

                    EMERGENT  FINANCIAL  GROUP,  INC.

                    By:  /s/  Jason  Galanis
                       --------------------------------
                          Jason  Galanis,  President

                    STARFISH,  LLC

                    By:  /s/  Greg  Harrington
                       --------------------------------
                         Name:  Greg  Harrington
                         Title: Managing  Member

<PAGE>
                                    EXHIBIT A

                           Form of Warrant Certificate
                           ---------------------------

<PAGE>
THE  SECURITIES  REPRESENTED HEREBY HAVE NOT BEEN REGISTERED WITH THE SECURITIES
AND  EXCHANGE  COMMISSION  UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR WITH
THE SECURITIES COMM ISSION OF ANY STATE UNDER ANY APPLICABLE STATE SECURITIES OR
BLUE  SKY  LAWS AND ARE SUBJECT TO THE WARRANT AGREEMENT, DATED AS OF AUGUST 28,
2001,  AMONG  EMERGENT  FINANCIAL  GROUP, INC. AND THE ORIGINAL HOLDER HEREOF (A
COPY OF EACH SUCH AGREEMENT IS ON FILE WITH THE SECRETARY OF THE COMPANY AND MAY
BE  OBTAINED  UPON  WRITTEN  REQUEST TO THE COMPANY). THE SECURITIES REPRESENTED
HEREBY  MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION  STATEMENT  OR  IN  A  TRANSACTION  EXEMPT  FROM  THE  REGISTRATION
REQUIREMENTS  OF  THOSE  SECURITIES  LAWS  AND  UPON  PROVISION OF AN OPINION OF
COUNSEL  IN  FORM  SATISFACTORY  TO  THE  COMPANY.

Certificate  No.  B2801-1

                            CERTIFICATE REPRESENTING
                         COMMON STOCK PURCHASE WARRANTS

         For the purchase of Common Stock, Par Value $.01 per share, of

                         EMERGENT FINANCIAL GROUP, INC.

                               4,600,000 WARRANTS
                         ______________________________

     THIS  CERTIFIES  THAT,  for  value  received, STARFISH, LLC, the registered
holder  of  this  Common  Stock  Purchase  Warrant  (the "Warrant") or permitted
assigns  (the  "Holder"), is entitled to purchase from Emergent Financial Group,
Inc., a Delaware corporation (the "Company"), at any time and from time to time,
upon  90  days  prior notice, until 5:00 p.m. Pacific Time on June 30, 2006 (the
"Expiration  Date"),  up to 4,600,000 fully paid and nonassessable shares of the
common stock of the Company, $0.01 par value per share (the "Shares") at a price
per  share  of  $0.25  (the "Exercise Price").  The number of shares purchasable
upon  exercise of this Warrant and the Purchase Price per share shall be subject
to  adjustment  from time to time as set forth in the Warrant Agreement referred
to  below.

This  Warrant  is issued under and in accordance with a Warrant Agreement, dated
as  of  August  28,  2001,  between  the Company and Starfish, LLC (the "Warrant
Agreement")  and is subject to the terms and provisions contained in the Warrant
Agreement,  all  of  which  are  incorporated herein by reference. A copy of the
Warrant  Agreement  may  be  obtained  for  inspection by the Holder hereof upon
written  request  to  the  Company.

     The Warrants represented by this Certificate may be exercised by the Holder
as  to  all  or  any lesser number of Shares upon surrender of this Certificate,
together with a completed and executed Election to Purchase in the form attached

                                        1
<PAGE>
to  this  Certificate,  on or before the date above designated, at the principal
office  of  the Company (or at such other address as is designated in writing by
the  Company);  and  upon payment, by cash, check or cashier's check, payable to
the  Company,  of a sum equal to the product of the Exercise Price multiplied by
the  number  of  Shares being purchased, or upon conversion of the Warrant under
the cashless exercise or easy exercise provisions set forth in Sections 6(c) and
(d)  of  the  Warrant  Agreement;  provided,  that  no fractional share shall be
issuable  upon  any  such exercise and the Company shall issue one full share in
lieu  of  any  fractional  share.  If  this  Certificate shall be exercised with
respect  to less than all of the Shares, the Holder shall be entitled to receive
a  new  Certificate  covering  the  number  of Shares with respect to which this
Certificate  shall  not have been exercised (if such shares are then purchasable
hereunder).

     This  Certificate  is  issued  subject to the condition, and the Holder, by
accepting  the  same,  agrees  with every subsequent holder and with the Company
that title hereto and all rights hereunder shall be transferable (subject to the
provisions of the Warrant Agreement) only by delivery of this Certificate to the
Company,  together  with  the assignment form attached hereto completed and duly
executed  by  the Holder; and that the Company and all persons dealing with this
Certificate  may treat the registered owner hereof as its absolute owner for all
purposes,  until  notified  in  writing  by  such  owner  of  a  transfer.

                              EMERGENT  FINANCIAL  GROUP,  INC.

                              By:   /s/  Jason  Galanis
                                    Jason  Galanis,  President

DATED:  As  of  August  28,  2001

                                        2
<PAGE>
                              ELECTION TO PURCHASE
                    (To be executed upon exercise of Warrant)

The  undersigned hereby irrevocably elects to exercise the right, represented by
this  Warrant  Certificate,  to  purchase  ________________  Shares and herewith
tenders  in  payment for such Shares cash, check or a certified or official bank
check,  payable to the order of Emergent Financial Group, Inc., in the amount of
$____________________, all in accordance with the terms hereof.  The undersigned
requests  that  a  certificate  of  such  Shares  be  registered  in the name of
_____________________whose  address  is ________________________________________
and  that  such  certificate  be delivered to _________________ whose address is
_________________ __________________________________________.   If the number of
Shares  being  acquired  is less than all purchasable hereunder, the undersigned
requests  that  a  new  Certificate  representing  the  remaining balance of the
Warrants  be  registered  in  the  name  of  and  delivered  to
_____________________whose  address  is  ________________________________.

Dated:__________________________     Signature:_________________________________
(Insert Social Security or Other     (Signature must conform in all respects
Identifying  Number  of Holder)      to name of holder as specified on the
                                     Face of  the  Warrant  Certificate)

                                     __________________________________________
                                     (Printed  Name)

                                   ASSIGNMENT
                      (To be executed if Holder desires to
                        transfer the Warrant Certificate)

For  Value  Received,  the  undersigned  hereby  sells, assigns and transfers to

                  (please print name and address of transferee)
this  Warrant  Certificate, together with all right, title and interest therein,
and  hereby  irrevocably  constitutes  and  appoints ___________________________
_______________________________  as attorney-in-fact to transfer the same on the
books  of  the  Company,  with  full  power  of  substitution.

Dated:__________________________     Signature:_________________________________
                                     (Signature must conform in all respects
                                     to  name of  holder as specified on the
                                     face  of the  Warrant  Certificate)

________________________________     ___________________________________________
(Insert Social Security or Other     (Printed  Name)
Identifying Number of Holder)

<PAGE>EXHIBIT E
                             To the Credit Agreement

                          MANAGEMENT SERVICES AGREEMENT

         THIS AGREEMENT, entered into as of this 6th day of July, 2001, by and
between Beijing Chinet Information Technology Company ("CHINET"), a limited
enterprise company formed under the laws of the People's Republic of China (the
"Company") and CBCOM CHINA, a wholly foreign-owned enterprise formed under the
laws of the People's Republic of China (the "Contractor").

                              W I T N E S S E T H:
                              - - - - - - - - - -
         WHEREAS, the Company is engaged in the business of designing,
developing, manufacturing, marketing and distributing peripheral equipment,
appliances and software for use with personal computers including, without
limitation, modems (the "Business of the Company");

         WHEREAS, the Company desires to provide internet services to various
users in the People's Republic of China (the "Project");

         WHEREAS, the Company desires to engage the Contractor, as an
independent contractor and not as an employee, in connection with the
formulation and execution of the Project and the Contractor desires to accept
such engagement by the Company, on the terms and conditions set forth herein;

         NOW, THEREFORE, for and in consideration of the above premises and the
mutual covenants and agreements hereinafter set forth, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

         1.       Definitions.

         Whenever used in this Agreement, the following terms shall have the
meanings set forth below:

                  a.    "Cause" shall mean (1) conduct by the Contractor in
connection with the performance of the Consulting Services (as hereinafter
defined) that amounts to fraud, dishonesty or willful misconduct in the
performance of its duties and responsibilities hereunder; or (2) the failure by
the Contractor to provide the Consulting Services in the manner and to the
extent required under this Agreement or the breach by the Contractor of any
other obligation owed by the Contractor to the Company under this Agreement.

                                       -1-

                                                        1378 v03.HK (12@03!.DOC)

                  b.    "Consulting Services" shall mean the services described
in Schedule I to this Agreement to be provided by the Contractor to and on
behalf of the Company.

                  c.    "Renminbi" or "RMB" shall mean the lawful currency of
the People's Republic of China.

                  d.    "Users" shall mean the number of internet subscribers
serviced either directly or indirectly through the Company.

2.       Scope of Consulting Services.
         ----------------------------
                  a.    The Company hereby retains the Contractor, and the
Contractor hereby accepts engagement by the Company, in a consulting and
advisory position in connection with the Project. In such capacity, the
Contractor will be responsible for planning and effecting certain component
activities of the Project under the direction of the Company as may from time to
time be needed, including but not limited to providing technical support,
equipment leases, software leasing and maintenance, sales and marketing services
and management consultation services, and will determine, and set the time
frames for completion of such activities as set forth in Schedule I to this
Agreement.

                  b.    The Contractor shall submit to the President of the
Company or its designee such reports describing the performance of its
activities hereunder as may be required by the President of the Company or its
designee from time to time.

                  c.    Anything herein to the contrary notwithstanding, the
parties hereto acknowledge and agree that the Company shall have no right to
control the manners means or methods by which the Contractor performs the
Consulting Services. Rather, the Company shall be authorized hereunder only to:
(1) direct the Contractor as to the elements of the particular Consulting
Services to be performed, the result desired by the Company to be achieved and
when the Project and activities comprising the Project are to be completed; (2)
inform the Contractor as to where and when such Consulting Services are desired
by the Company to be performed; and (3) supervise and assess the performance of
the Consulting Services by the Contractor for the limited purposes of assuring
that the Consulting Services have been performed and determining the results of
the Contractor's efforts.

3.       Compensation.
         ------------
                  a.    In consideration for the Consulting Services made
available or rendered by the Contractor, the Company shall pay to the Contractor
compensation on a monthly basis, based upon the number of Users and the Revenue
collected as set forth below:

            Eighty Percent (80%) of total revenue collected per Month

Aggregate compensation for Consulting Services, however, may be adjusted upwards
from time to time in order to more accurately reflect the value of Contractor's
services by written agreement signed by the Company and Contractor.

                                       -2-

                                                        1378 v03.HK (12@03!.DOC)

b. The Company will furnish the Contractor with such office space, secretarial
and clerical assistance, telephone service and other facilities, services and
supplies as may be necessary or appropriate in order for the Contractor to
perform the Consulting Services. Such services, facilities and supplies shall
not be used other than for the performance of the Consulting Services, unless
such other use (1) is first approved by the President of the Company or its
designee, or (2) will not result in a substantial increase in the cost to the
Company.

c. In addition to the compensation set forth in Section 3(a) of this Agreement,
all actual expenses incurred by the Contractor on behalf of the Company which
are reasonably necessary and appropriate in performing the Consulting Services,
shall be reimbursed to the Contractor by the Company; provided, however, that
such reimbursement shall not be obtained unless such expense is approved in
accordance with the terms and conditions of the Company's independent contractor
expense report policy in effect at the time such expense is incurred or in
advance and in writing by the President of the Company or its designee. The
Contractor must itemize all expenses for which it requests reimbursement on the
invoices required in Section 3(a), which must be accompanied by the original
receipts for any single item of expense that exceeds RMB 5000. Contractor shall
have the right to review and examine the books and records of the Company on a
monthly basis.

4.       Term.
         ----
         The term of this Agreement shall commence from the date of this
Agreement for [twenty] years until the Contractor certifies, in its sole
discretion, that the Project is completed, or unless sooner terminated as
provided herein in Section 5. Except as provided in the preceding sentence, the
Company shall have no right to terminate this Agreement and hereby agrees to pay
liquidated damages of RMB 20,000,000 if the Company unilaterally terminates this
Agreement. Upon termination, all rights and obligations of the parties under
this Agreement shall immediately cease and terminate (except for the rights of
the Company and the obligations of the Contractor pursuant to Section 9 which
shall survive such termination), and the parties shall have no further
obligation to each other, except that Company shall pay Contractor compensation
and reimbursable expenses accrued and unpaid at the date of termination. If at
termination, the Contractor shall have only partially completed the Consulting
Services, the compensation accrued shall be equal to the product of the total
amount of compensation due under this Agreement multiplied by the percentage of
the corresponding Consulting Services that the Contractor can demonstrate it has
completed as of the termination date.

5.       Termination.
         -----------
         The engagement of the Contractor by the Company under this Agreement
may be terminated only as follows:

         a.     At any time by mutual agreement of the parties hereto;

         b.     At any time by the Contractor upon fifteen (15) days prior
written notice of termination delivered to the Company in accordance with the
provisions of Section 7 hereof;

                                       -3-
                                                        1378 v03.HK (12@03!.DOC)

c.     For Cause by the Company upon written notice of termination
delivered to the Contractor personally or in accordance with the provisions of
Section 7 hereof, such Cause being specified in the notice, provided that the
Contractor shall have one month to remedy such Cause; and

         d. By the Contractor upon a breach of this Agreement by the Company and
failure by the Company to remedy such breach within fifteen (15) days after
notification thereof delivered in accordance with the provisions of Section 7
hereof.

6.       Severability.
         ------------
         In case one or more of the provisions contained in this Agreement shall
for any reason be held to be invalid, illegal or unenforceable in any respect,
the same shall not affect any other provision in this Agreement, but this
Agreement shall be construed as if such invalid or illegal or unenforceable
provision had never been contained herein.

7.       Notices.
         -------
         Any notice required or permitted to be given to the Contractor pursuant
to this Agreement shall be given in writing, and personally delivered or mailed
to the Contractor by certified mail, return receipt requested, at the address
set forth below its signature on this Agreement or at such other address as it
shall designate by written notice to the Company given in accordance with this
Section 7, and any notice required or permitted to be given to the Company shall
be given in writing, and personally delivered or mailed to the Company by
certified mail, return receipt requested, addressed to the Company at the
address set forth under the signature of the President of the Company or its
designee on this Agreement or at such other address as the Company shall
designate by written notice to the Contractor given in accordance with this
Section 7. Any notice complying with this Section 7 shall be deemed received
upon actual receipt by the addressee.

8.       Assignment.
         ----------
         This Agreement, and the rights and obligations of the parties
hereunder, may be assigned only upon the prior written approval of the parties
hereto. The rights and obligations of the parties hereto shall inure to the
benefit of, shall be binding upon, and shall be enforceable by the parties
hereto and their lawful successors, representatives and assigns.

9.       Independent Contractor; Indemnification.
         ---------------------------------------
         The Contractor is an independent contractor and this Agreement does not
constitute or appoint the Contractor as an employee or agent of the Company. The
Company shall not be liable for the Contractor's debts, accounts, obligations or
other liabilities including, without limitation, the Contractor s obligation to
withhold social security and income taxes. The Contractor will indemnify and
hold harmless the Company of, from and against any loss, liability, damage,
action, cause of action, cost or expense (including, without limitation,
attorneys' fees) arising out of or with respect to (1) the payment by the
Company of any debt, account, obligation or other liability of the Contractor;
(2) any unauthorized act of the Contractor which may be determined to be binding
on the Company, and (3) any claims of third parties made by reason of such
unauthorized act.
                                       -4-

                                                        1378 v03.HK (12@03!.DOC)

10.      Entire Agreement.
         ----------------
         This Agreement, when executed, embodies the entire agreement of the
parties hereto relating to the subject matter hereof. No amendment or
modification of this Agreement shall be valid or binding upon the Company or the
Contractor unless made in writing and signed by the parties hereto.

11.      Waiver.
         ------
         The waiver by one party of a breach of any provision of this Agreement
by the other party shall not operate or be construed as a waiver of any
subsequent breach of the same or any other provision by the other party.

12.      Governing Law.
         -------------
         This Agreement shall be governed by and construed in accordance with
the laws of the People's Republic of China.

                                       -5-

                                                        1378 v03.HK (12@03!.DOC)

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

                                    The Company:
                                    CHINET

                                    By:
                                       ------------------------------------
                                    Title:
                                          ---------------------------------
                                    Address:
                                            -------------------------------

                                    ---------------------------------------

                                    The Contractor:
                                    CBCom China

                                    By:
                                       ------------------------------------
                                    Title:
                                          ---------------------------------
                                    Address:
                                            -------------------------------

                                    ---------------------------------------

                                       -6-

                                                        1378 v03.HK (12@03!.DOC)

                                   SCHEDULE I
                                   ----------
                          SCOPE OF CONSULTING SERVICES
                          ----------------------------

                  Contractor shall provide:

All equipment, software and engineering services in respect of the internet
network for selling services to end users which shall include but not be limited
to:

         The engineering design, the integration, the installation and the
testing of the internet network, the customization of the internet network
protocol and of the network management software; the development of end user
interface software and user applications software; the technical support to the
internet network and advisory services on maintenance; the supply of equipment
and instruments to the internet network.

Consulting services regarding bookkeeping, accounting, banking and financial
consulting services related to the collection of revenue from end users for
internet services.

Consulting services regarding marketing and selling of prepaid internet service
cards to end users for the purpose of dialing and obtaining access into the
Company's internet network.

Any and all other consulting services as may be agreed between the parties, from
time to time.

                                       -7-

                                                        1378 v03.HK (12@03!.DOC)

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