BY AND AMONG EDNET, INC.,

1
EX-10.(a)

AGREEMENT AND PLAN OF REORGANIZATION

BY AND AMONG

EDNET, INC.,

A COLORADO CORPORATION

EDN SUB, INC.,

A CALIFORNIA CORPORATION

AND

INTERNET WORLDWIDE BUSINESS SOLUTIONS,

A CALIFORNIA CORPORATION

DATED AS OF JUNE 24, 1996

TABLE OF CONTENTS

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ARTICLE I

THE MERGER...................................................................................................2
1.1 The Merger..........................................................................................2
1.2 Effective Time......................................................................................2
1.3 Effect of the Merger................................................................................2
1.4 Articles of Incorporation; Bylaws...................................................................2
1.5 Directors and Officers..............................................................................2
1.6 Merger Consideration; Effect on Capital Stock.......................................................3
1.7 Surrender of Certificates; Payment of Merger Consideration..........................................4
1.8 No Further Ownership Rights in Company Common Stock.................................................4
1.9 Lost, Stolen or Destroyed Certificates..............................................................5
1.10 Tax Consequences....................................................................................5
1.11 Taking of Necessary Action; Further Action..........................................................5

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF THE COMPANY................................................................5
2.1 Organization........................................................................................5
2.2 Authorized Capitalization...........................................................................5
2.3 Authority...........................................................................................6
2.4 Company Financial Statements........................................................................6
2.5 No Undisclosed Liabilities..........................................................................6
2.6 Taxes...............................................................................................6
2.7 Properties..........................................................................................6
2.8 Books and Records...................................................................................6
2.9 Insurance...........................................................................................7
2.10 Transactions with Certain Persons...................................................................7
2.11 Material Contracts..................................................................................7
2.12 Employment Matters..................................................................................7
2.13 Authorizations......................................................................................7
2.14 No Powers of Attorney...............................................................................8
2.15 Compliance with Laws................................................................................8
2.16 Compliance with Environmental Laws..................................................................8
2.17 No Litigation.......................................................................................8
2.18 Validity............................................................................................8
2.19 No Adverse Changes..................................................................................8
2.20 Fees................................................................................................8

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TABLE OF CONTENTS

(CONTINUED)

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2.21 Full Disclosure.....................................................................................8

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB......................................................9
3.1 Organization, Standing and Power....................................................................9
3.2 Authority...........................................................................................9
3.3 Cash Consideration..................................................................................9
3.4 Parent Financial Statements.........................................................................9
3.5 Parent Common Stock.................................................................................9
3.6 Continuity of Business Enterprise..................................................................10
3.7 Authorized Capitalization..........................................................................10
3.8 Full Disclosure....................................................................................10

ARTICLE IV

CONDUCT PRIOR TO THE EFFECTIVE TIME.........................................................................10
4.1 Conduct of Business of the Company.................................................................10
4.2 No Solicitation....................................................................................12

ARTICLE V

ADDITIONAL AGREEMENTS.......................................................................................13
5.1 Access to Information..............................................................................13
5.2 Confidentiality....................................................................................13
5.3 Expenses...........................................................................................13
5.4 Public Disclosure..................................................................................13
5.5 Consents...........................................................................................13
5.6 Legal Requirements.................................................................................14
5.7 Notification of Certain Matters....................................................................14
5.8 Additional Documents and Further Assurances........................................................14
5.9 Certain Benefit Plans..............................................................................14
5.10 Blue Sky Laws......................................................................................14
5.11 Employment Agreements..............................................................................14
5.12 Earn-Out Plan......................................................................................14
5.13 Parent Stock Options...............................................................................15
5.14 Board of Directors of Parent.......................................................................15
5.15 Restrictions on Sale...............................................................................15

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TABLE OF CONTENTS

(CONTINUED)

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ARTICLE VI

CONDITIONS TO THE MERGER....................................................................................15
6.1 Conditions to Obligations of Each Party to Effect the Merger.......................................15
6.2 Additional Conditions to Obligations of Company....................................................15
6.3 Additional Conditions to the Obligations of Parent and Merger Sub..................................16

ARTICLE VII

TERMINATION, AMENDMENT AND WAIVER...........................................................................17
7.1 Termination........................................................................................17
7.2 Effect of Termination..............................................................................18
7.3 Amendment..........................................................................................18
7.4 Extension; Waiver..................................................................................18
7.5 Notice of Termination..............................................................................18

ARTICLE III

GENERAL PROVISIONS..........................................................................................18
8.1 Notices............................................................................................18
8.2 Interpretation.....................................................................................19
8.3 Counterparts.......................................................................................19
8.4 Entire Agreement; Assignment.......................................................................20
8.5 Severability.......................................................................................20
8.6 Other Remedies.....................................................................................20
8.7 Governing Law......................................................................................20
8.8 Rules of Construction..............................................................................20

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INDEX OF EXHIBITS

Exhibit Description

Exhibit A Form of First Note

Exhibit B Form of Second Note

Exhibit C Earn-Out Plan

Exhibit D Company Schedule of Exceptions

Exhibit E Parent and Merger Sub Schedule of Exceptions

Exhibit F-1 Form of Employment Agreement (Xxxxx)

Exhibit F-2 Form of Employment Agreement (Xxxxxxx)

Exhibit G Schedule of Employee Stock Options

Exhibit H Continuity of Interest Certificate

Exhibit I-1 Ownership Certificate (Xxxxx)

Exhibit I-2 Ownership Certificate (Xxxxxxx)

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AGREEMENT AND PLAN OF REORGANIZATION

This AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made and
entered into as of June 24, 1996 by and among EDNET, INC., a Colorado
corporation ("Parent"), EDN SUB, INC., a California corporation and a
wholly-owned subsidiary of Parent ("Merger Sub"), and INTERNET WORLDWIDE
BUSINESS SOLUTIONS, a California corporation d.b.a. Internet Business Solutions
(the "Company").

RECITALS

A. The Boards of Directors of each of the Company, Parent and Merger
Sub believe it is in the best interests of each company and their respective
stockholders that Parent acquire the Company through the statutory merger of the
Company with and into Merger Sub (the "Merger") and, in furtherance thereof,
have approved the Merger.

B. All of the stockholders of the Company and Merger Sub believe that
the Merger is in the best interests of each company and their respective
stockholders and, in furtherance thereof, have approved the Merger.

C. Pursuant to the Merger, among other things, all of the issued and
outstanding shares of common stock, no par value, of the Company (the "Company
Common Stock") shall be converted into a promissory note from Parent, shares of
common stock of Parent (the "Parent Common Stock") and a Plan to issue
additional shares of Parent Common Stock in the event certain milestones are
met, all in accordance with the terms and subject to the conditions set forth in
this Agreement.

D. The Company, Parent and Merger Sub desire to make certain
representations and warranties and other agreements in connection with the
Merger.

E. The parties intend, by executing this Agreement, to adopt a plan of
reorganization within the meaning of Section 368(a) of the Internal Revenue Code
of 1986, as amended (the "Code").

NOW, THEREFORE, in consideration of the covenants, promises and
representations set forth herein, and for other good and valuable consideration,
the parties agree as follows:

ARTICLE I

THE MERGER

1.1 The Merger. At the Effective Time (as defined in Section 1.2) and
subject to and upon the terms and conditions of this Agreement and the
applicable provisions of the California Corporations Code and the Colorado
Corporations Code, the Company shall be merged with and into Merger Sub, the
separate corporate existence of the Company shall cease and Merger Sub shall
continue as the surviving corporation and as a wholly-owned subsidiary of
Parent. Merger Sub as the surviving corporation after the Merger is hereinafter
sometimes referred to as the "Surviving Corporation."

1.2 Effective Time. Unless this Agreement is earlier terminated
pursuant to Section 7.1, the closing of the Merger (the "Closing") will take
place at the offices of Wilson, Sonsini, Xxxxxxxx & Xxxxxx, 000 Xxxx Xxxx Xxxx,
Xxxx Xxxx, Xxxxxxxxxx at such time and date as Parent and the Company may
mutually select. The date upon which the Closing actually occurs is herein
referred to as the "Closing Date." On the Closing Date, the parties hereto shall
cause the Merger to be consummated by filing a Certificate of Merger (or like
instrument) with the Secretary of State of the State of California (the
"Certificate of Merger"), in accordance with the relevant provisions of
applicable law (the time of acceptance by the Secretary of State of California
of such filing being referred to herein as the "Effective Time").

1.3 Effect of the Merger. At the Effective Time, the effect of the
Merger shall be as provided in the applicable provisions of California law.
Without limiting the generality of the foregoing, and subject thereto, at the
Effective Time, all the property, rights, privileges, powers and franchises of
the Company and Merger Sub shall vest in the Surviving Corporation, and all
debts, liabilities, obligations and duties of the Company and Merger Sub shall
become the debts, liabilities, obligations and duties of the Surviving
Corporation.

1.4 Articles of Incorporation; Bylaws.

(a) Unless otherwise determined by Parent prior to the
Effective Time, at the Effective Time, the Articles of Incorporation of Merger
Sub, as in effect immediately prior to the Effective Time, shall be the Articles
of Incorporation of the Surviving Corporation until thereafter amended as
provided by law.

(b) The Bylaws of Merger Sub, as in effect immediately prior
to the Effective Time, shall be the Bylaws of the Surviving Corporation until
thereafter amended.

1.5 Directors and Officers. The directors of Merger Sub immediately
prior to the Effective Time shall be the initial directors of the Surviving
Corporation, each to hold office in accordance with the Articles of
Incorporation and Bylaws of the Surviving Corporation. The officers of Merger
Sub immediately prior to the Effective Time shall be the initial officers of the
Surviving Corporation, each to hold office in accordance with the Bylaws of the
Surviving Corporation.

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1.6 Merger Consideration; Effect on Capital Stock. The consideration to
be paid by Parent in exchange for the acquisition of all outstanding Company
Common Stock shall be (i) secured promissory notes payable for an aggregate
principal amount of $250,000 in the form of Exhibit A hereto (the "First
Notes"), (ii) promissory notes payable for an aggregate principal amount of
$250,000 in the form of Exhibit B hereto (the "Second Notes"), (iii) 311,284
shares of Parent Common Stock, and (iv) the contractual obligation to issue up
to 500,000 additional shares of Parent Common Stock in the event that certain
milestones are reached as evidenced by the Earn-Out Plan attached hereto as
Exhibit C.

(a) Payment of Merger Consideration. Subject to the terms and
conditions of this Agreement, as of the Effective Time, by virtue of the Merger
and without any action on the part of Merger Sub, the Company or the holders of
any shares of Company Common Stock, each share of Company Common Stock issued
and outstanding as of immediately prior to the Effective Time will be canceled
and extinguished at the Effective Time and will be converted at such time into
the right to receive, upon surrender of the certificate representing such share
of Company Common Stock in the manner provided in Section 1.8, a First Note, a
Second Note, a number of shares of Parent Common Stock, a right to receive
shares of Parent Common Stock pursuant to the terms of the Earn-Out Plan such
amount of notes, stock and rights to receive stock (collectively, the "Merger
Consideration") on the terms and conditions set forth in this Agreement as
follows:

(A) Stock. Each share of Company Common Stock shall
be entitled to receive a number of shares of Parent Common Stock equal to the
quotient of (i) 311,284, divided by (ii) the number of shares of Company Common
Stock outstanding as of the Closing, provided that no fractional shares of
Parent Common Stock shall be issued, and in lieu thereof, any fractional shares
issuable to any holder after aggregating all shares of Company Common Stock
owned by such holder shall be rounded up to a whole share;

(B) Notes. In addition, each holder of Company Common
Stock shall be entitled to receive a First Note and a Second Note each in the
principal amount of $250,000 multiplied by the quotient of (i) the number of
shares of Company Common Stock owned by the holder, divided by (ii) the total
outstanding shares of Company Common Stock; and

(C) Earn-Out Plan. In addition, each holder of
Company Common Stock shall be entitled to receive additional Parent Common Stock
pursuant to the Earn Out Plan in the form of Exhibit C.

(b) Cancellation of Parent-Owned and Company-Owned Stock.
Each share of Company Common Stock owned by Merger Sub, Parent, the Company or
any direct or indirect wholly owned subsidiary of Parent or of the Company
immediately prior to the Effective Time shall be canceled and extinguished
without any conversion thereof.

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(c) Capital Stock of Merger Sub. Each share of common stock,
par value $0.001 per share, of Merger Sub issued and outstanding immediately
prior to the Effective Time shall, following the Effective Time, represent one
validly issued, fully paid and nonassessable share of common stock, par value
$0.001 per share, of the Surviving Corporation. Each stock certificate of Merger
Sub evidencing ownership of any such shares shall continue to evidence ownership
of such shares of capital stock of the Surviving Corporation. Following the
Effective Time, all of such shares of capital stock of the Surviving Corporation
shall be held by the former shareholders of the Company as security for Parent's
debts owed under the First Notes.

1.7 Surrender of Certificates; Payment of Merger Consideration.

(a) Exchange Agent. Prior to the Effective Time, Parent and
the Company shall designate a mutually acceptable third party to act as exchange
agent (the "Exchange Agent") in the Merger.

(b) Parent to Provide Common Stock. Promptly after the
Effective Time, Parent shall make available to the Exchange Agent for exchange
in accordance with this Article I, the aggregate Merger Consideration payable
pursuant to Section 1.6 in exchange for outstanding shares of Company Common
Stock.

(c) Exchange Procedures. Promptly after the Effective Time,
the Parent shall deliver the Merger consideration in exchange for certificates
representing all outstanding shares of Company Common Stock (the
"Certificates"). Until so surrendered, each outstanding Certificate that, prior
to the Effective Time, represented shares of Company Common Stock, will be
deemed from and after the Effective Time, to evidence only the right to receive
the Merger Consideration in respect of each such share.

(d) Distributions With Respect to Unexchanged Shares. No
dividends or other distributions declared or made with a record date after the
Effective Time with respect to Parent Common Stock will be paid to the holder of
any unsurrendered Certificate with respect to the shares of Parent Common Stock
represented thereby until the holder of record of such Certificate shall
surrender such Certificate. Subject to applicable law, following surrender of
any such Certificate, there shall be paid to the record holder of the
certificates representing whole shares of Parent Common Stock issued in exchange
therefor, without interest, at the time of such surrender, the amount of
dividends or other distributions with a record date after the Effective Time
theretofore paid with respect to such whole shares of Parent Common Stock.

1.8 No Further Ownership Rights in Company Common Stock. All amounts
paid upon the surrender for exchange of shares of Company Common Stock in
accordance with the terms hereof shall be deemed to have been issued in full
satisfaction of all rights pertaining to such shares of Company Common Stock,
and there shall be no further registration of transfers on the records of the
Surviving Corporation of shares of Company Common Stock which were outstanding
immediately prior to the Effective Time. If, after the Effective Time,
Certificates are presented to the Parent or the Surviving

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Corporation for any reason, they shall be canceled and the Merger Consideration
shall be delivered to the person entitled thereto.

1.9 Lost, Stolen or Destroyed Certificates. In the event any
Certificates shall have been lost, stolen or destroyed, the Parent shall make
payment in exchange for such lost, stolen or destroyed certificates, upon the
making of an affidavit of that fact by the holder thereof and an agreement to
indemnify Parent against any claim that may be made against Parent with respect
to the certificates alleged to have been lost, stolen or destroyed.

1.10 Tax Consequences. It is intended by the parties hereto that the
Merger shall constitute a reorganization within the meaning of Section 368(a) of
the Code.

1.11 Taking of Necessary Action; Further Action. If, at any time after
the Effective Time, any further action is necessary or desirable to carry out
the purposes of this Agreement and to vest the Surviving Corporation with full
right, title and possession to all assets, property, rights, privileges, powers
and franchises of the Company and Merger Sub or to vest Parent with a 100%
ownership interest in the Surviving Corporation, the officers and directors of
the Surviving Corporation are fully authorized in the name of the Company and
the Surviving Corporation or otherwise to take, and will take, all such lawful
and necessary and/or desirable action so long as such action is consistent with
this Agreement and the security interest in all of the outstanding shares of the
Surviving Corporation granted pursuant to this Agreement.

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

The Company represents and warrants to Parent and Merger Sub, subject
to the Company Schedule of Exceptions attached hereto as Exhibit D, as follows:

2.1 Organization. The Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and to carry on its business. The Company is duly
qualified and in good standing as a foreign corporation in each jurisdiction in
which the failure to be so qualified would have a material adverse effect on the
business or property of the Company (a "Material Adverse Effect").

2.2 Authorized Capitalization. The authorized capitalization of the
Company consists of one hundred thousand (100,000) shares of no par value Common
Stock, of which fifty thousand (50,000) shares have been issued and are
outstanding. The shares have been duly authorized, validly issued, are fully
paid and nonassessable with no personal liability attaching to the ownership
thereof and were offered, issued, sold and delivered by the Company in
compliance with all applicable state and federal laws. The Company does not have
any outstanding rights, options, warrants, calls, commitments, conversion or any
other agreements of any character, whether oral or written, obligating it to
issue any shares of its capital stock, whether authorized or not. The Company is
not a party to and is not bound

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by any agreement, contract, arrangement or understanding, whether oral or
written, giving any person or entity any interest in, or any right to share,
participate in or receive any portion of, the Company's income, profits or
assets, or obligating the Company to distribute any portion of its income,
profits or assets.

2.3 Authority. The Company has full power and lawful authority to
execute and deliver this Agreement and to consummate and perform the
transactions contemplated hereby. This Agreement constitutes (or shall, upon
execution, constitute) a valid and legally binding obligation upon the Company,
enforceable in accordance with its terms. Neither the execution and delivery of
the Agreement by the Company, nor the consummation and performance of the
transactions contemplated hereby, conflicts with, requires the consent, waiver
or approval of, results in a breach of or default under, or gives to others any
interest or right of termination, cancellation or acceleration in or with
respect to, any material agreement by which the Company is a party or by which
the Company or any of its material properties or assets are bound or affected.

2.4 Company Financial Statements. The Company's unaudited financial
statements for the period ended April 30, 1996 are complete, were prepared in
accordance with generally accepted accounting principles (except for the
omission of footnotes) applied on a basis consistent with prior periods and
fairly present the financial position of the Company as of April 30, 1996.

2.5 No Undisclosed Liabilities. Except as set forth in the Company's
financial statements previously delivered to Parent and Merger Sub, the Company
is not aware of any material liabilities for which the Company is liable or will
become liable in the future.

2.6 Taxes. The Company has filed all federal, state, local tax and
other returns and reports which were required to be filed with respect to all
taxes, levies, imposts, duties, licenses and registration fees, charges or
withholdings of every nature whatsoever ("Taxes"), and there exists a
substantial basis in law and fact for all positions taken in such reports. No
waivers of periods of limitation are in effect with respect to any taxes arising
from and attributable to the ownership of properties or operations of the
business of the Company.

2.7 Properties. The Company has good and marketable title to all its
material personal property, equipment, processes, patents, copyrights,
trademarks, franchises, licenses and other material properties and assets
(except for items leased or licensed to the Company), including all property
reflected in the Company's financial statements (except for assets reflected
therein which have been sold in the normal course of its business where the
proceeds from such sale or other disposition have been properly accounted for in
the financial statements of the Company), in each case free and clear of all
material liens, claims and encumbrances of every kind and character. The Company
does not own any real property. The assets and properties owned, operated or
leased by the Company and used in its business are in good operating condition,
reasonable wear and tear excepted, and suitable for the uses for which intended.

2.8 Books and Records. The books and records of the Company are
complete and correct in all material respects, have been maintained in
accordance with good business practices and accurately

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reflect in all material respects the business, financial condition and results
of operations of the Company as set forth in the Company's financial statements.

2.9 Insurance. The Company Schedule of Exceptions contains an accurate
and complete list and brief description of all performance bonds and policies of
insurance, including fire and extended coverage, general liability, workers
compensation, products liability, property, and other forms of insurance or
indemnity bonds held by the Company. The Company is not in default with respect
to any provisions of any such policy or indemnity bond and has not failed to
give any notice or present any claim thereunder in due and timely fashion. All
policies of insurance and bonds are: (1) in full force and effect; (2) are
sufficient for compliance by the Company with all requirements of law and of all
agreements and instruments to which the Company is a party; (3) are valid,
outstanding and enforceable; (4) will remain in full force and effect through
the Closing; and (5) will not be affected by, and will not terminate or lapse by
reason of, the transactions contemplated by this Agreement.

2.10 Transactions with Certain Persons. Except as disclosed in the
Company Schedule of Exceptions, the Company has no outstanding material
agreement, understanding, contract, lease, commitment, loan or other material
arrangement with any officer, director or shareholder of the Company or any
relative of any such person, or any corporation or other entity in which such
person owns a material beneficial interest.

2.11 Material Contracts. Except as set forth in the Company Schedule of
Exceptions, the Company has no purchase, sale, commitment, or other contract,
the breach or termination of which would have a materially adverse effect on the
business, financial condition, results of operations, assets, liabilities, or
prospects of the Company.

2.12 Employment Matters. The Company Schedule of Exceptions contains a
list of all officers, their base salaries, accrued vacation pay, sick pay, and
severance pay through April 30, 1996. Except as set forth in the Company
Schedule of Exceptions, the Company is not a party to any employment agreement,
or any pension, profit sharing, retirement or other deferred compensation plan
or agreement. The Company has not incurred any unfunded deficiency or liability
within the meaning of the Employee Retirement Income Security Act of 1974
("ERISA"), has not incurred any liability to the Pension Benefit Guaranty
Corporation established under ERISA in connection with any employee benefit plan
and has no outstanding obligations or liabilities under any employee benefit
plan. The Company has not been a party to a "prohibited transaction," which
would subject the Company to any tax or penalty. There is no collective
bargaining agreement or negotiations therefor, labor grievance or arbitration
proceeding against the Company pending or threatened, and to the knowledge of
the Company, there are no union organizing activities currently pending or
threatened against or involving the Company.

2.13 Authorizations. The Company has no licenses, permits, approvals
and other authorizations from any governmental agencies and any other entities
that are materially necessary for the conduct of its business, except as set
forth in the Company Schedule of Exceptions which contains a list of all
material licenses, permits, approvals, and other material authorizations, as
well as a list of all material copyrights, patents, trademarks, trade names,
service marks, franchises, licenses and other material permits, each of which is
valid and in full force and effect.

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2.14 No Powers of Attorney. The Company has no powers of attorney or
similar authorizations outstanding.

2.15 Compliance with Laws. The Company is not in violation of any
federal, state, local or other law, ordinance, rule or regulation applicable to
its business, and has not received any actual or threatened complaint, citation
or notice of violation or investigation from any governmental authority, in each
case where such violation would have a material adverse effect on the Company.

2.16 Compliance with Environmental Laws. The Company is in compliance
with all applicable pollution control and environmental laws, rules and
regulations in all material respects. The Company has no environmental licenses,
permits and other authorizations held by the Company relative to compliance with
environmental laws, rules and regulations.

2.17 No Litigation. There are no actions, suits, claims, complaints or
proceedings pending or threatened against the Company, at law or in equity, or
before or by any governmental department, commission, court, board, bureau,
agency or instrumentality; and there are no facts which would provide a valid
basis for any such action, suit or proceeding, which, if determined adversely to
the Company, would have a material adverse effect on the Company. There are no
orders, judgments or decrees of any governmental authority outstanding which
specifically apply to the Company or any of its assets.

2.18 Validity. All material contracts, agreements, leases and licenses
to which the Company is a party or by which it or any of its material properties
or assets are bound or affected, are valid and in full force and effect; and no
breach or default exists, or upon the giving of notice or lapse of time, or
both, would exist, on the part of the Company or by any other party thereto.

2.19 No Adverse Changes. Since April 30, 1996, there have been no
actual or threatened developments of a nature that is materially adverse to or
involves any materially adverse effect upon the business, financial condition,
results of operations, assets, liabilities, or prospects of the Company.

2.20 Fees. All negotiations relating to this Agreement and the
transactions contemplated hereby have been conducted by the Company in such a
manner as not to give rise to any valid claim for any finder's fees, brokerage
commission, financial advisory fee or related expense or other like payment for
which the Company has obligated itself, Parent or Merger Sub.

2.21 Full Disclosure. All statements of the Company contained in this
Agreement and in any other written documents delivered by or on behalf of the
Company to Parent or Merger Sub, when taken as a whole, are true and correct in
all material respects and do not omit any material fact necessary to make the
statements contained therein not misleading in light of the circumstances under
which they were made. There are no facts known to the Company which have a
material adverse affect upon the business, financial condition, results of
operations, assets, liabilities, or prospects of the Company, which have not
been disclosed to Parent or Merger Sub in this Agreement.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Parent and Merger Sub represent and warrant to the Company, subject to
the Parent and Merger Sub Schedule of Exceptions attached hereto as Exhibit E,
as follows:

3.1 Organization, Standing and Power. Parent is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Colorado. Merger Sub is a corporation duly organized, validly existing and in
good standing under the laws of the State of California. Each of Parent and
Merger Sub has the corporate power to own its properties and to carry on its
business as now being conducted and is duly qualified to do business and is in
good standing in each jurisdiction in which the failure to be so qualified would
have a material adverse effect on the business, assets, financial condition, or
results of operations of Parent or the ability of Parent and Merger Sub to
consummate the transactions contemplated hereby.

3.2 Authority. Parent and Merger Sub have full power and lawful
authority to execute and deliver this Agreement and to consummate and perform
the transactions contemplated hereby. This Agreement constitutes (or shall, upon
execution, constitute) a valid and legally binding obligation upon Parent and
Merger Sub, enforceable in accordance with its terms. Neither the execution and
delivery of the Agreement by Parent or Merger Sub, nor the consummation and
performance of the transactions contemplated hereby, conflicts with, requires
the consent, waiver or approval of, results in a breach of or default under, or
gives to others any interest or right of termination, cancellation or
acceleration in or with respect to, any material agreement to which Parent or
Merger is a party or by which Parent or Merger Sub or any of their material
properties or assets are bound or affected. No consent, approval, order or
authorization of, or registration, declaration or filing with, any governmental
entity, is required by or with respect to Parent and Merger Sub in connection
with the execution and delivery of this Agreement by Parent and Merger Sub or
the consummation by Parent and Merger Sub of the transactions contemplated
hereby, except for the filing of the Certificate of Merger with the California
Secretary of State.

3.3 Cash Consideration. Parent currently has available, and at the
Effective Time of the Merger will continue to have available, sufficient stock
and cash to enable it to perform its obligations under this Agreement, except as
indicated in the Parent and Merger Sub Schedule of Exceptions.

3.4 Parent Financial Statements. Parent's unaudited financial
statements for the period ended April 30, 1996 are complete, were prepared in
accordance with generally accepted accounting principles (except for the
omission of footnotes) applied on a basis consistent with prior periods and
fairly present the financial position of Parent as of April 30, 1996.

3.5 Parent Common Stock. The shares of Parent Common Stock, when issued
in the Merger in compliance with this Agreement, will be (i) validly issued,
fully paid and nonassessable, (ii) issued in compliance with applicable state
and federal securities laws and (iii) shall constitute an exempt security under
Section 3(a)10 of the Securities Act of 1933.

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3.6 Continuity of Business Enterprise. After the Effective Time, Parent
and Merger Sub will continue a significant historic business line of the Company
or use a significant portion of the Company's historic business assets in a
business, in each case within the meaning of Treasury Regulation Section 1.368-
1(d).

3.7 Authorized Capitalization. The authorized capitalization of Parent
consists of Fifty Million (50,000,000) shares of .001 par value Common Stock, of
which Four Million One Hundred Fifty Seven Thousand Thirty Eight (4,157,038)
shares have been issued and are outstanding as of May 31, 1996, and Five Million
(5,000,000) shares of $.001 par value non-voting Preferred Stock with none
outstanding at May 31, 1996. Parent's Shares have been duly authorized, validly
issued, are fully paid and nonassessable with no personal liability attaching to
the ownership thereof and were offered, issued, sold and delivered by Parent in
compliance with all applicable state and federal laws. Parent does not have any
outstanding rights, options, warrants, calls, commitments, conversion or any
other agreements of any character, whether oral or written, obligating it to
issue any shares of its capital stock whether authorized or not. Parent is not a
party to and is not bound by any agreement, contract, arrangement or
understanding, whether oral or written, giving any person or entity any interest
in, or any right to share, participate in or receive any portion of Parent's
income, profits or assets, or obligating Parent to distribute any portion of its
income, profits or assets.

3.8 Full Disclosure. All statements of Parent or Merger Sub contained
in this Agreement and in any other written documents delivered by or on behalf
of Parent or Merger Sub to the Company, when taken as a whole, are true and
correct in all material respects and do not omit any material fact necessary in
order to make the statements contained therein not misleading in light of the
circumstances under which they were made. There are no facts known to Parent or
Merger Sub which have a material adverse affect upon the business, financial
condition, results of operations, assets, liabilities or prospects of Parent
that have not been disclosed to the Company in this Agreement.

ARTICLE IV

CONDUCT PRIOR TO THE EFFECTIVE TIME

4.1 Conduct of Business of the Company. During the period from the date
of this Agreement and continuing until the earlier of the termination of this
Agreement or the Effective Time, the Company agrees (except to the extent that
Parent shall otherwise consent), to carry on its business in the usual, regular
and ordinary course in substantially the same manner as heretofore conducted, to
pay its debts and Taxes when due unless validly withheld, to pay or perform
other obligations when due, and, to the extent consistent with such business and
except as agreed to by Parent and the Company, use all reasonable efforts
consistent with past practice and policies to preserve intact the Company's
present business organization, keep available the services of its present
officers and key employees and preserve their relationships with customers,
suppliers, distributors, licensors, licensees, and others having business
dealings with it, all with the goal of preserving unimpaired the Company's
goodwill and ongoing businesses at the Effective Time. The Company shall
promptly notify Parent of any event or occurrence or emergency not in the
ordinary course of business of the Company, and any material event involving

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16

the Company. Except as expressly contemplated by this Agreement, the Company
shall not, without the prior written consent of Parent:

(a) Enter into any commitment or transaction not in the
ordinary course of business;

(b) Transfer to any person or entity any rights to the
Company's intellectual property (other than pursuant to end user or existing
licenses in the ordinary course of business);

(c) Enter into or make any material amendments to any
agreements pursuant to which any other party is granted marketing, distribution
or similar rights of any type or scope with respect to any products of the
Company;

(d) Make any material amendments to, terminate or violate any
distribution agreement or material contract, agreement or license to which the
Company is a party or by which it is bound other than termination by the Company
pursuant to the terms thereof in the ordinary course of business and without
financial penalty to the Company;

(e) Declare, set aside or pay any dividends on or make any
other distributions (whether in cash, stock or property) in respect of any of
its capital stock, or split, combine or reclassify any of its capital stock or
issue or authorize the issuance of any other securities in respect of, in lieu
of or in substitution for shares of capital stock of the Company, or repurchase,
redeem or otherwise acquire, directly or indirectly, any shares of its capital
stock (or options, warrants or other rights exercisable therefor);

(f) Issue, deliver or sell or authorize or propose the
issuance, delivery or sale of, or purchase or propose the purchase of, any
shares of its capital stock or securities convertible into, or subscriptions,
rights, warrants or options to acquire, or other agreements or commitments of
any character obligating it to issue any such shares or other convertible
securities;

(g) Cause or permit any amendments to its Articles of
Incorporation or Bylaws;

(h) Acquire or agree to acquire by merging or consolidating
with, or by purchasing any of the assets or equity securities of, or by any
other manner, any business or any corporation, partnership, association or other
business organization or division thereof, or otherwise acquire or agree to
acquire any assets which are material, individually or in the aggregate, to the
business of the Company;

(i) Incur any indebtedness for borrowed money (except with
respect to indebtedness incurred by the Company in the ordinary course of
business and under existing term loans or revolving credit lines or an extension
thereof) or guarantee any such indebtedness or issue or sell any debt securities
of the Company or guarantee any debt securities of others;

(j) Grant any severance or termination pay (i) to any director
or officer or (ii) to any other employee except payments made pursuant to
standard written agreements outstanding on the date hereof;

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17

(k) Adopt or amend any employee benefit plan, or enter into
any employment contract, pay or agree to pay any special bonus or special
remuneration to any director or employee, or increase the salaries or wage rates
of its employees;

(l) Revalue any of its assets, including without limitation
writing down the value of inventory or writing off notes or accounts receivable
other than in the ordinary course of business;

(m) Pay, discharge or satisfy, in an amount in excess of
$5,000 (in any one case) or $10,000 (in the aggregate), any claim, liability or
obligation (absolute, accrued, asserted or unasserted, contingent or otherwise),
other than the payment, discharge or satisfaction of liabilities in the ordinary
course of business or liabilities reflected or reserved against in the Company's
financial statements (or the notes thereto);

(n) Make or change any material election in respect of Taxes,
adopt or change any accounting method in respect of Taxes, enter into any
closing agreement, settle any claim or assessment in respect of Taxes, or
consent to any extension or waiver of the limitation period applicable to any
claim or assessment in respect of Taxes;

(o) Enter into any strategic alliance or joint marketing
arrangement or agreement;

(p) Take, or agree in writing or otherwise to take, any of the
actions described in Sections 4.1(a) through (p) above, or any other action that
would prevent the Company from performing or cause the Company not to perform
its covenants hereunder.

4.2 No Solicitation. Until the earlier of the Effective Time or the
date of termination of this Agreement pursuant to the provisions of Section 7.1
hereof, the Company will not (nor will the Company permit any of the Company's
officers, directors, agents, stockholders, representatives or affiliates to)
directly or indirectly, take any of the following actions with any party other
than Parent and its designees: (a) solicit third parties relating to the
possible acquisition of the Company (whether by way of merger, purchase of
capital stock, purchase of assets or otherwise) or a material portion of its
capital stock or assets, (b) enter into an agreement providing for the
acquisition of the Company (whether by way of merger, purchase of capital stock,
purchase of assets or otherwise) or a material portion of its capital stock or
assets or (c) make or authorize any statement, recommendation or solicitation in
support of any possible acquisition of the Company (whether by way of merger,
purchase of capital stock, purchase of assets or otherwise) or any material
portion of its capital stock or assets.

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18

ARTICLE V

ADDITIONAL AGREEMENTS

5.1 Access to Information. Each party shall afford the other party and
its accountants, counsel and other representatives, reasonable access during
normal business hours upon reasonable notice during the period prior to the
Effective Time to (a) all of such party's properties, books, contracts,
commitments and records, and (b) all other information concerning the business,
properties and personnel (subject to restrictions imposed by applicable law) of
such party as the other party may reasonably request, including without
limitation access upon reasonable request to employees, customers and vendors
for due diligence inquiry. Each party shall provide the other party and its
accountants, counsel and other representatives copies of internal financial
statements, business plans and projections promptly upon request. No information
or knowledge obtained in any investigation pursuant to this Section 5.1 shall
affect or be deemed to modify any representation or warranty contained herein or
the conditions to the obligations of the parties to consummate the Merger.

5.2 Confidentiality. Each of the parties hereto hereby agrees to keep
such information or knowledge obtained in any investigation pursuant to Section
5.1, or pursuant to the negotiation and execution of this Agreement or the
effectuation of the transactions contemplated hereby, confidential in accordance
with the terms of the confidentiality agreement executed by the Parent and the
Company (the "Confidentiality Agreement").

5.3 Expenses. If the Merger is not consummated, all fees and expenses
incurred in connection with the Merger including, without limitation, all legal,
accounting, financial advisory, consulting and all other fees and expenses of
third parties ("Third Party Expenses") incurred by a party or its stockholders
in connection with the negotiation and effectuation of the terms and conditions
of this Agreement and the transactions contemplated hereby, shall be the
obligation of the respective party incurring such fees and expenses. If the
Merger is consummated, all Third Party Expenses incurred by the Company and its
shareholders up to $40,000 shall be paid by the Parent.

5.4 Public Disclosure. Unless otherwise required by law, prior to the
Effective Time, no disclosure (whether or not in response to an inquiry) of the
subject matter of this Agreement shall be made by any party hereto unless
approved by Parent and the Company prior to release, provided that such approval
shall not be unreasonably withheld, subject, in the case of Parent, to Parent's
obligation to comply with applicable securities laws.

5.5 Consents. Each of Parent and the Company shall promptly apply for
or otherwise seek, and use its best efforts to obtain, all consents and
approvals required to be obtained by it for the consummation of the Merger, and
the Company shall use its best efforts to obtain all consents, waivers and
approvals under any of the Company's agreements, contracts, licenses and leases
in order to preserve the benefits thereunder for the Surviving Corporation and
otherwise in connection with the Merger; provided, however, that the parties
agree that the Merger will not be conditioned upon, or delayed in order to seek,
the receipt of a favorable ruling from the Internal Revenue Service with respect
to the tax treatment of the Merger.

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19

5.6 Legal Requirements. Subject to the terms and conditions provided in
this Agreement, each of the parties hereto shall use its reasonable best efforts
to take promptly, or cause to be taken, all reasonable actions, and to do
promptly, or cause to be done, all things necessary, proper or advisable under
applicable laws and regulations to consummate and make effective the
transactions contemplated hereby to obtain all necessary waivers, consents and
approvals and to effect all necessary registrations and filings and to remove
any injunctions or other impediments or delays, legal or otherwise, in order to
consummate and make effective the transactions contemplated by this Agreement
for the purpose of securing to the parties hereto the benefits contemplated by
this Agreement.

5.7 Notification of Certain Matters. The Company shall give prompt
notice to Parent, and Parent shall give prompt notice to the Company, of (i) the
occurrence or non-occurrence of any event, the occurrence or non-occurrence of
which may cause any representation or warranty of the Company or Parent,
respectively, contained in this Agreement to be untrue or inaccurate at the
Effective Time and (ii) any failure of the Company or Parent, as the case may
be, to comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it hereunder; provided, however, that the delivery
of any notice pursuant to this Section 5.7 shall not limit or otherwise affect
any remedies available to the party receiving such notice and will not limit the
Company's ability to correct or resolve such inaccuracy or to cure such failure
by the Effective Time.

5.8 Additional Documents and Further Assurances. Each party hereto, at
the request of another party hereto, shall execute and deliver such other
instruments and do and perform such other acts and things as may be necessary or
desirable for effecting completely the consummation of this Agreement and the
transactions contemplated hereby.

5.9 Certain Benefit Plans. Following the Effective Time, Parent shall
take such reasonable actions as are necessary to allow eligible employees of the
Company to participate in the benefit programs of Parent, or alternative benefit
programs substantially comparable to those applicable to employees of Parent on
similar terms, as soon as practicable after the Effective Time.

5.10 Blue Sky Laws. Parent shall take such steps as may be necessary to
comply with the securities and blue sky laws of all jurisdictions which are
applicable to the issuance of Parent Common Stock pursuant hereto. The Company
shall use its best efforts to assist Parent as may be necessary to comply with
the securities and blue sky laws of all jurisdictions which are applicable in
connection with the issuance of Parent Common Stock pursuant hereto.

5.11 Employment Agreements. Contemporaneously with the execution of
this Agreement, the Company and Xxxxxxx X. Xxxxxxx are entering into an
employment agreement and, the Company and Xxxxxx X. Xxxxx are entering into an
employment agreement (collectively, with Xx. Xxxxx'x agreement, the "Employment
Agreements") which shall become effective as of the Effective Time. Xx. Xxxxx'x
Employment Agreement is substantially in the form of Exhibit F-1 hereto and Xx.
Xxxxxxx' Employment Agreement is substantially in the form of Exhibit F-2
hereto.

5.12 Earn-Out Plan. Upon the Effective Time, Parent shall provide an
Earn-Out Plan for Xx. Xxxxxxx and Xx. Xxxxx.

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20

5.13 Parent Stock Options. A pool of nonstatutory stock options to
purchase an aggregate of 60,000 shares of Parent Common Stock shall be issued to
certain Company employees who will become employees of Parent or Surviving
Corporation following the Effective Time. These options shall have an exercise
price of $1.25 and shall have terms and provisions comparable to other employee
stock option grants. These options shall be granted promptly after the Effective
Time to the individuals and in the amounts set forth on Exhibit G.

5.14 Board of Directors of Parent. Following the Closing of the Merger,
(i) both Xx. Xxxxxxx and Xx. Xxxxx shall be appointed to the Board of Directors'
of the Surviving Corporation, and (ii) Mr. Trevor shall be appointed to the
Board of Directors of Parent. This Section 5.14 shall terminate as to Xx.
Xxxxxxx or Xx. Xxxxx, when either Xx. Xxxxxxx or Xx. Xxxxx, respectively, ceases
to own at least 50,000 shares of Parent Common Stock.

5.15 Restrictions on Sale. None of the 311,284 shares of Parent Common
Stock to be received by the shareholders of the Company may be sold prior to
January 1, 1997. Parent may issue stop transfer instructions to its transfer
agent in order to enforce the foregoing restriction.

ARTICLE VI

CONDITIONS TO THE MERGER

6.1 Conditions to Obligations of Each Party to Effect the Merger. The
respective obligations of each party to this Agreement to effect the Merger
shall be subject to the satisfaction at or prior to the Effective Time of the
following conditions:

(a) No Injunctions or Restraints; Illegality. No temporary
restraining order, preliminary or permanent injunction or other order issued by
any court of competent jurisdiction or other legal restraint or prohibition
preventing the consummation of the Merger shall be in effect, nor shall any
proceeding brought by an administrative agency or commission or other
governmental authority or instrumentality, domestic or foreign, seeking any of
the foregoing be pending; nor shall there be any action taken, or any statute,
rule, regulation or order enacted, entered, enforced or deemed applicable to the
Merger, which makes the consummation of the Merger illegal.

(b) Employment Agreements. The Employment Agreements shall
have been duly executed and delivered and shall be in full force and effect.

(c) Issuance of Permit. The California Department of
Corporations shall have issued a Permit under Section 25121 of the California
Corporate Securities Law of 1968, as amended (the "California Securities Law"),
covering the issuance of the Parent Common Stock following a hearing as to the
fairness of the Merger conducted pursuant to Section 25142 of the California
Securities Law.

6.2 Additional Conditions to Obligations of Company. The obligations of
the Company to consummate and effect this Agreement and the transactions
contemplated hereby shall be subject to the

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21

satisfaction at or prior to the Effective Time of each of the following
conditions, any of which may be waived, in writing, exclusively by the Company:

(a) Representations, Warranties and Covenants. The
representations and warranties of Parent and Merger Sub in this Agreement shall
be true and correct on and as of the Effective Time as though such
representations and warranties were made on and as of such time and each of
Parent and Merger Sub shall have performed and complied with all covenants,
obligations and conditions of this Agreement required to be performed and
complied with by it as of the Effective Time.

(b) Certificate of Parent. The Company shall have been
provided with a certificate executed on behalf of Parent by its President and
its Chief Financial Officer to the effect that, as of the Effective Time:

(i) all representations and warranties made by Parent
and Merger Sub under this Agreement are true and complete; and

(ii) all covenants, obligations and conditions of
this Agreement to be performed by Parent and Merger Sub on or before such date
have been so performed.

(c) No Material Adverse Changes. There shall not have occurred
any material adverse change in the business, assets or financial condition of
Parent.

(d) Continuity of Interest Certificate. Parent shall have
delivered a Continuity of Interest Certificate in the form of Exhibit H hereto.

6.3 Additional Conditions to the Obligations of Parent and Merger Sub.
The obligations of Parent and Merger Sub to consummate and effect this Agreement
and the transactions contemplated hereby shall be subject to the satisfaction at
or prior to the Effective Time of each of the following conditions, any of which
may be waived, in writing, exclusively by Parent:

(a) Representations, Warranties and Covenants. The
representations and warranties of the Company in this Agreement shall be true
and correct in all material respects on and as of the Effective Time as though
such representations and warranties were made on and as of such time, and the
Company shall have performed and complied in all material respects with all
covenants, obligations and conditions of this Agreement required to be performed
and complied with by it as of the Effective Time.

(b) Certificate of the Company. Parent shall have been
provided with a certificate executed on behalf of the Company by its Chief
Executive Officer to the effect that, as of the Effective Time:

(i) all representations and warranties made by the
Company in this Agreement are true and correct; and

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22

(ii) all covenants, obligations and conditions of
this Agreement to be performed by the Company on or before such date have been
so performed.

(c) No Material Adverse Changes. There shall not have occurred
any material adverse change in the business, assets or financial condition of
the Company.

(d) Securities Law Compliance. Parent shall be able to issue
the Parent Common Stock that comprises part of the Merger Consideration in
compliance with the Securities Act of 1933, as amended, and the rules and
regulations thereunder.

(e) Ownership Certification. Xxxxxx Xxxxx and Xxxxxxx Xxxxxxx
shall have delivered an Ownership Certificate in the form of Exhibit I-1 and
Exhibit I-2, respectively.

ARTICLE VII

TERMINATION, AMENDMENT AND WAIVER

7.1 Termination. Except as provided in Section 7.2 below, this
Agreement may be terminated and the Merger abandoned at any time prior to the
Effective Time:

(a) by mutual consent of the Company and Parent;

(b) by Parent or the Company if the Closing has not occurred
within seventy-five (75) days following the date of this Agreement, other than
due to the failure of the party seeking to terminate this Agreement to perform
its obligations under this Agreement which are required to be performed at or
prior to the Effective Time;

(c) by Parent or the Company if there shall be a final
nonappealable order of a federal or state court in effect preventing
consummation of the Merger; or there shall be any action taken, or any statute,
rule, regulation or order enacted, promulgated or issued or deemed applicable to
the Merger by any Governmental Entity which would make the consummation of the
Merger illegal;

(d) by Parent if it is not in breach of its obligations under
this Agreement and there has been a material breach of any representation,
warranty, covenant or agreement contained in this Agreement on the part of the
Company, provided that, if such breach is curable by the Company through the
exercise of its reasonable best efforts within forty-five (45) days of the
notice by Parent of such breach, then for so long as the Company continues to
exercise such reasonable best efforts Parent may not terminate this Agreement
under this Section 7.1(d) unless such breach is not cured within such forty-five
(45) day period; or,

(e) by the Company if it is not in material breach of its
obligations under this Agree ment and there has been a material breach of any
representation, warranty, covenant or agreement contained in this Agreement on
the part of Parent or Merger Sub, provided that, if such breach is curable by
Parent through the exercise of its reasonable best efforts within 45 days of the
notice by the Company

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of such breach, then for so long as Parent continues to exercise such reasonable
best efforts the Company may not terminate this Agreement under this Section
7.1(e) unless such breach is not cured within such forty-five (45) day period.

Where action is taken to terminate this Agreement pursuant to this
Section 7.1, it shall be sufficient for such action to be authorized by the
Board of Directors (as applicable) of the party taking such action.

7.2 Effect of Termination. In the event of termination of this
Agreement as provided in Section 7.1, this Agreement shall forthwith become void
and there shall be no liability or obligation on the part of Parent, Merger Sub
or the Company, or their respective officers, directors or stockholders,
provided that each party shall remain liable for any breaches of this Agreement
prior to its termination; and provided further that, the provisions of Sections
5.2, 5.3, 5.4, Article VII and Article VIII of this Agreement shall remain in
full force and effect and survive any termination of this Agreement.

7.3 Amendment. Except as is otherwise required by applicable law, this
Agreement may be amended by the parties hereto at any time by execution of an
instrument in writing signed on behalf of each of the parties hereto.

7.4 Extension; Waiver. At any time prior to the Effective Time, Parent
and Merger Sub, on the one hand, and the Company, on the other, may, to the
extent legally allowed, (i) extend the time for the performance of any of the
obligations of the other party hereto, (ii) waive any inaccuracies in the
representations and warranties made to such party contained herein or in any
document delivered pursuant hereto, and (iii) waive compliance with any of the
agreements or conditions for the benefit of such party contained herein. Any
agreement on the part of a party hereto to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of such
party.

7.5 Notice of Termination. Any termination of this Agreement under
Section 7.1 above will be effective immediately upon the delivery of written
notice of the terminating party to the other parties hereto.

ARTICLE VIII

GENERAL PROVISIONS

8.1 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered personally or by commercial
delivery service, or mailed by registered or certified mail (return receipt
requested) or sent via facsimile (with acknowledgment of complete transmission)
to the parties at the following addresses (or at such other address for a party
as shall be specified by like notice):

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(a) if to Parent or EDnet, Inc.
Merger Sub,to: ATTN: Xxx Xxxxxxxxx, Chairman & CEO
Xxx Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

with a copy to: Xxxxxx, Xxxxxx & Xxxxxxxx, P.C.
ATTN: Xxxxxxx X. Xxxxxxxxxx and G. Xxxxx
Xxxxxx
000 XXXXX Xxxxx
000 Xxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

(b) if to the Company, to: Internet Business Solutions
ATTN: Xxxxxxx X. Xxxxxxx and
Xxxxxx X. Xxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

with a copy to: Wilson, Sonsini, Xxxxxxxx & Xxxxxx, P.C.
ATTN: Xxxxxx X. Xxxxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

8.2 Interpretation. The words "include," "includes" and "including"
when used herein shall be deemed in each case to be followed by the words
"without limitation." The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.

8.3 Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party, it being understood that all
parties need not sign the same counterpart.

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8.4 Entire Agreement; Assignment. This Agreement, the schedules and
Exhibits hereto, and the documents and instruments and other agreements among
the parties hereto referenced herein: (a) constitute the entire agreement among
the parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, both written and oral, among the parties with
respect to the subject matter hereof except for the Confidentiality Agreement,
which shall remain in full force and effect in accordance with their respective
terms; (b) are not intended to confer upon any other person any rights or
remedies hereunder; and (c) shall not be assigned by operation of law or
otherwise except as otherwise specifically provided, except that Parent and
Merger Sub may assign their respective rights and delegate their respective
obligations hereunder to their respective affiliates.

8.5 Severability. In the event that any provision of this Agreement or
the application thereof, becomes or is declared by a court of competent
jurisdiction to be illegal, void or unenforceable, the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto. The parties further agree to replace
such void or unenforceable provision of this Agreement with a valid and
enforceable provision that will achieve, to the extent possible, the economic,
business and other purposes of such void or unenforceable provision.

8.6 Other Remedies. Except as otherwise provided herein, any and all
remedies herein expressly conferred upon a party will be deemed cumulative with
and not exclusive of any other remedy conferred hereby, or by law or equity upon
such party, and the exercise by a party of any one remedy will not preclude the
exercise of any other remedy.

8.7 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws thereof.
Each of the parties hereto irrevocably consents to the exclusive jurisdiction
and venue of any court within San Mateo County, State of California, in
connection with any matter based upon or arising out of this Agreement or the
matters contemplated herein, agrees that process may be served upon them in any
manner authorized by the laws of the State of California for such persons and
waives and covenants not to assert or plead any objection which they might
otherwise have to such jurisdiction, venue and such process.

8.8 Rules of Construction. The parties hereto agree that they have been
represented by counsel during the negotiation and execution of this Agreement
and, therefore, waive the application of any law, regulation, holding or rule of
construction providing that ambiguities in an agreement or other document will
be construed against the party drafting such agreement or document.

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26

IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this
Agreement to be signed by their duly authorized respective officers, all as of
the date first written above.

INTERNET WORLDWIDE BUSINESS EDNET, INC.
SOLUTIONS

By /s/ Xxxxxxx X. Xxxxxxx By /s/ Xxx Xxxxxxxxx
--------------------------------- ----------------------------
Xxxxxxx X. Xxxxxxx, Xxx Xxxxxxxxx,
Chief Executive Officer Chairman and CEO

EDN SUB, INC.

By /s/ Xxxxxx Xxxxx
----------------------------
Xxxxxx X. Xxxxx
President and CFO

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27

EXHIBIT A

FORM OF FIRST NOTE

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28

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR QUALIFIED UNDER APPLICABLE STATE
SECURITIES LAWS AND HAVE BEEN TAKEN FOR INVESTMENT PURPOSES ONLY AND NOT WITH A
VIEW TO OR FOR SALE IN CONNECTION WITH ANY DISTRIBUTION THEREOF. THE SECURITIES
MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION AND
QUALIFICATION WITHOUT, EXCEPT UNDER CERTAIN SPECIFIC LIMITED CIRCUMSTANCES, AN
OPINION OF COUNSEL FOR THE HOLDER, CONCURRED IN BY COUNSEL FOR THE COMPANY THAT
SUCH REGISTRATION AND QUALIFICATION ARE NOT REQUIRED.

EDNET, INC.

SECURED PROMISSORY NOTE

Palo Alto, California
$125,000.00 June 24, 1996

1. Principal and Interest. EDNET, INC. (the "Company"), a Colorado
corporation, for value received, hereby promises to pay to the order of
or holder ("Payee") in lawful money of the United States of
America at the address of Payee set forth below, the principal amount set
forth above, together with interest as set forth below.

The Company promises to pay interest on the unpaid principal
amount of this Note at the rate of eight percent (8.0%) per annum from the date
of this Note until such principal amount is paid in full. Accrued interest shall
be payable at the time the Company pays the entire unpaid principal amount.

All unpaid principal and unpaid accrued interest of this Note
is due and payable on or before the sixtieth (60th) day following the closing of
the Agreement and Plan of Reorganization by and among EDnet, Inc., EDN Sub, Inc.
and Internet Worldwide Business Solutions (the "Agreement and Plan of
Reorganization").

All unpaid principal and unpaid accrued interest of this Note
may be prepaid without penalty, in whole or in part, at any time. Any prepayment
of this Note shall be made only at the same time as the Company prepays all
other secured Notes issued pursuant to the Agreement and Plan of Reorganization,
with such prepayments to be made pro-rata in proportion to the then outstanding
principal amount of such secured Notes. Any prepayment of this Note will be
credited first against accrued interest then principal.

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Upon payment in full of the entire principal amount of this
Note and interest payable hereunder, this Note shall be surrendered to the
Company for cancellation.

2. Security Interest.

(a) As security for payment of the entire principal
amount of this Note and interest payable hereunder,
the Company grants to the holder of this Note and all
other secured Notes issued pursuant to the Agreement
and Plan of Reorganization (the "Holders") a
continuing security interest in, and a continuing
lien upon, all outstanding shares of the Surviving
Corporation (as defined in the Agreement and Plan of
Reorganization). Such shares are referred to as the
"Collateral."

(b) The Company agrees that the security interest in the
Collateral granted to the Holders hereunder shall be
and remain the sole lien upon the Collateral prior to
all other interests.

3. Maintenance of Collateral Security. The Company shall continually
take such steps as are necessary and prudent to protect the security interest in
the Collateral, including without limitation the following:

(a) Execute and deliver to the Holders such other and
further documents, instruments or writings as they
may deem necessary or advisable in order to evidence,
effectuate, perfect, maintain or properly foreclose
upon the security interest in the Collateral;

(b) Keep the Collateral free of all liens and
encumbrances, other than the security interest or the
Holders created hereby, until all of the obligations
secured by the Collateral are paid in full; and

(c) Deliver the certificates representing the Collateral
to the Holders together with assignments separate
from certificate in the form of Exhibit A to this
Note.

4. Attorney's Fees. If the indebtedness represented by this Note or any
part thereof is collected in bankruptcy, receivership or other judicial
proceedings or if this Note is placed in the hands of attorneys for collection
after default, the Company agrees to pay, in addition to the principal and
interest payable hereunder, reasonable attorneys' fees and costs incurred by the
Holders.

5. Notices. Any notice, other communication or payment required or
permitted hereunder shall be in writing and shall be deemed to have been given
upon delivery if personally delivered or three business days after deposit if
deposited in the United States mail for mailing by certified mail, postage
prepaid, and addressed as follows:

-24-
30

(1) if to the Company: EDnet, Inc.
ATTN: Xxx Xxxxxxxxx, Chairman & CEO
Xxx Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

(2) if to Payee: Internet Business Solutions
ATTN: Xxxxxxx X. Xxxxxxx and
Xxxxxx X. Xxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

with a copy to: Wilson, Sonsini, Xxxxxxxx & Xxxxxx, P.C.
ATTN: Xxxxxx X. Xxxxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

Each of the above addresses may change its address for purposes of this
paragraph by giving to the other addressee notice of such new address in
conformance with this paragraph.

6. Acceleration. This Note shall become immediately due and payable if
(i) the Company commences any proceeding in bankruptcy or for dissolution,
liquidation, winding-up, composition or other relief under state or federal
bankruptcy laws; or (ii) such proceedings are commenced against the Company, or
a receiver or trustee is appointed for the Company or a substantial part of its
property.

7. Rights Upon Default. In the event that the entire principal amount
of this Note and interest payable hereunder is not paid when due, then the
Holders may transfer the Collateral to their ownership in satisfaction of the
Company's obligations under the secured Notes issued pursuant to the Agreement
and Plan of Reorganization. The Collateral shall be transferred to the Holders
in proportion to the principal amounts due to the Holders under such secured
Notes. This shall be accomplished by

-25-
31

appending the executed assignments with instructions to transfer the Collateral
to the Holders and delivering such assignments and certificates to the transfer
agent of the Surviving Corporation. The transfer agent shall promptly transfer
such shares to the names of the Holders or their designees.

8. No Dilution or Impairment. The Company will not, by amendment of its
Articles of Incorporation or Bylaws or those of the Surviving Corporation
through any reorganization, transfer assets, consolidation, merger, dissolution,
issue or sale of securities or any other voluntary action, avoid or seek to
avoid the observance or performance of any of the terms of this Note, but will
at all times in good faith assist in the carrying out of all such terms and in
the taking of all such action as may be necessary or appropriate in order to
protect the rights of the holder of this Note against dilution or other
impairment.

9. Waivers. The Company hereby waives presentment, demand for
performance, notice of non-performance, protest, notice of protest and notice of
dishonor. No delay on the part of Payee in exercising any right hereunder shall
operate as a waiver of such right or any other right. This Note is being
delivered in and shall be construed in accordance with the laws of the State of
California, without regard to the conflicts of laws provisions thereof.

EDNET, INC.

By: /s/ Xxx Xxxxxxxxx
-------------------------------
Xxx Xxxxxxxxx, Chairman and CEO

-26-
32

EXHIBIT B

FORM OF SECOND NOTE

-27-
33

EDNET, INC.

PROMISSORY NOTE

Palo Alto, California
$125,000 June 24, 1996

1. Principal Interest. EDNET, INC. (the "Company"), a Colorado
corporation, for value received, hereby promises to pay to the order of
______________________ or holder ("Payee") in lawful money of the United States
of America at the address of Payee set forth below, the principal amount set
forth above together with interest as set forth below.

All unpaid principal and unpaid accrued interest of this Note
is due and payable upon the earlier of (i) twelve months from the closing of the
Agreement and Plan of Reorganization by and among EDnet, Inc., EDN Sub, Inc.,
and Internet Worldwide Business Solutions (the "Agreement and Plan of
Reorganization") or (ii) fifteen (15) days after the closing of a public
offering of Company Common Stock. The closing shall be deemed to have occurred
when the underwriters purchase from the Company a majority of the shares offered
to the public and pay for such shares.

All unpaid principal and unpaid accrued interest of this Note
may be prepaid without penalty, in whole or in part, at any time. Any prepayment
of this Note shall be made only at the same time as the Company prepays all
other unsecured Notes issued pursuant to the Agreement and Plan of
Reorganization, with such prepayments to be made pro-rata in proportion to the
then outstanding principal amounts of such unsecured Notes. Any prepayment of
this Note will be credited first against accrued interest then principal.

-28-
34

Upon payment in full of the entire principal amount of the
Note and interest payable hereunder, this Note shall be surrendered to the
Company for cancellation.

2. Attorneys' Fees. If the indebtedness represented by this Note or any
part thereof is collected in bankruptcy, receivership or other judicial
proceedings or if this Note is placed in the hands of attorneys for collection
after default, the Company agrees to pay, in addition to the principal and
interest payable hereunder, reasonable attorneys' fees and costs incurred by
Payee.

3. Notices. Any notice, other communication or payment required or
permitted hereunder shall be in writing and shall be deemed to have been given
upon delivery if personally delivered or three business days after deposit if
deposited in the United States mail for mailing by certified mail, postage
prepaid, and addressed as follows:

(1) if to the Company: EDnet, Inc.
ATTN: Xxx Xxxxxxxxx, Chairman & CEO
Xxx Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

(2) if to Payee: Internet Business Solutions
ATTN: Xxxxxxx X. Xxxxxxx and
Xxxxxx X. Xxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

with a copy to: Wilson, Sonsini, Xxxxxxxx & Xxxxxx, P.C.
ATTN: Xxxxxx X. Xxxxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

-29-
35

Each of the above addressees may change its address for purposes of this
paragraph by giving to the other addressee notice of such new address in
conformance with this paragraph.

4. Acceleration. This Note shall become immediately due and payable if
(i) the Company commences any proceeding or bankruptcy or for dissolution,
liquidation, winding-up, composition or other relief under state or federal
bankruptcy laws; or (ii) such proceedings are commenced against the Company, or
a receiver or trustee is appointed for the Company or a substantial part of its
property.

5. No Dilution or Impairment. The Company will not, by amendment of its
Articles of Incorporation or Bylaws or through any reorganization, transfer of
assets, consolidation, merger, dissolution, issue or sale of securities or any
other voluntary action, avoid or seek to avoid the observance or performance of
any of the terms of this Note, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the holder of this
Note against dilution or other impairment.

6. Waivers. The Company hereby waives presentment, demand for
performance, notice of non-performance, protest, notice of protest and notice of
dishonor. No delay on the part of Payee in exercising any right hereunder shall
operate as a waiver of such right or any other right. This Note is being
delivered in and shall be construed in accordance with the laws of the State of
California, without regard to the conflicts of laws provisions thereof.

EDNET, INC.

By: /s/ Xxx Xxxxxxxxx
--------------------------------
Xxx Xxxxxxxxx, Chairman and CEO

-30-
36
EXHIBIT C

EARN-OUT PLAN

EXHIBIT C

EDNET, INC.

EARN-OUT PLAN

I. Purposes of the Plan.

Pursuant to the Agreement and Plan of Reorganization by and among
EDnet, Inc., EDN Sub, Inc., and Internet Worldwide Business Solutions dated as
of June 24, 1996 (the "Reorganization Agreement") , EDnet, Inc. (the "Company")
is hereby establishing an Earn-Out Plan (the "Plan") to issue up to an aggregate
of 500,000 shares of the Company Common Stock to certain persons identified
herein over a period provided herein provided that the revenues or profits of
Internet Worldwide Business Solutions or of the Surviving Corporation (as that
term is defined in the Reorganization Agreement) ("IBS") reach certain levels
provided herein.

II. Definitions.

A. "Board" means the Board of Directors of the Company.

B. "GAAP" means generally accepted accounting principles,
consistently applied.

C. "Profits" means IBS' net income before income taxes,
determined in accordance with GAAP except without regard to allocations of
corporate overhead from the Company or any of its affiliates to IBS.

D. "Revenues" means IBS' gross revenue, determined in
accordance with GAAP.

III. Administration of the Plan.

The Plan shall be administered by the Board or such person or committee
as is designated by the Board (the "Administrator"). Subject to Section VIII
herein, the Administrator shall construe and interpret the terms of the Plan.

IV. Term of Plan.

The Plan shall become effective upon the "Effective Time," as such term
is defined in the Reorganization Agreement, and shall terminate one hundred
twenty (120) days after June 30, 1999, unless a determination is being disputed
pursuant to Section VIII.

V. Eligibility.

The persons eligible to receive the Company Common stock pursuant to
the Plan shall be the individuals listed on Exhibit A hereto (individually a
"Plan Participant" and collectively the "Plan Participants").

VI. Company Common Stock Allocation.

Plan Participants shall be eligible to receive up to an aggregate of
166,500 shares of Company Common Stock in each applicable time period ("Stock
Allocation"). The Stock Allocation shall be distributed among the Plan
Participants according to the percentages stated next to each Plan Participant's
name on Exhibit A. The Stock Allocation shall be issued to Plan Participants
within one hundred twenty (120) days following the end of the applicable time
period, unless a determination is being disputed pursuant to Section VIII.

VII. Stock Allocation Formula.

Set forth below are the time periods during which a measurement IBS'
Revenues and IBS' Profits will be made and the Stock Allocation that will be
distributed if either threshold set forth for such period is met or exceeded. If
a threshold for a given time period is exceeded, the amount in excess shall not
be added to the amount in the next time period or used to determine whether that
threshold has been met or exceeded.

Jan. 1, 1996 to Jan. 1, 1997 to July 1, 1997 to July 1, 1998 to
Time Period Dec. 31, 1996 June 30, 1997 June 30, 1998 June 30, 1999
-----------

(1) IBS' Revenues $ 675,000 $ 1,650,000 $ 5,025,000 $ 9,375,000
IBS' Profits $ 90,000 $ 385,000 $ 1,340,000 $ 2,500,000
Stock Allocation 93,750 31,500 124,875 124,875

(2) IBS' Revenues $ 900,000 $ 2,200,000 $ 6,700,000 $12,500,000
IBS' Profits $ 90,000 $ 385,000 $ 1,340,000 $ 2,500,000
Stock Allocation 125,000 42,000 166,500 166,500

VIII. Disputes Regarding Profits or Revenues.

All determinations of Profits or Revenues shall be made in good faith
by the Company within ninety (90) days of the end of the applicable time period.
The Plan Participants shall have a period of twenty (20) days after receiving
the Profits or Revenues determinations (the "Objection Period") to present in
writing to the Company any objections the Plan Participants may have to any of
the matters set forth therein, which objections (and the basis therefor) shall
be set forth in reasonable detail. If no objections are received by the Company
from the Plan Participants within the Objection Period, the calculation of
Profits or Revenues shall be final and binding upon the Plan Participants and
the Company. If the Plan Participants raise any objections to any determination
of Profits or Revenues furnished by the Company within the Objection Period and
in the manner provided in this Section VIII, the Company shall

-2-

negotiate in good faith to resolve any such objections. If they, for any
reason, are unable to resolve any such dispute within ten (10) days following
the expiration of such Objection Period, then the specific matters in dispute
shall be submitted to a "Big Six" nationally recognized certified public
accounting firm as may be mutually selected by the Company and the Plan
Participants, which firm shall make such calculation of Profits or Revenues,
and which calculation shall be final and binding upon all of the parties. The
Company and the Plan Participants shall bear the cost of the services of such
accounting firm equally.

IX. Amendment of the Plan.

The Plan may be amended only by a writing signed by each of the
Company, IBS and the Plan Participants.

X. Governing Law.

The Plan shall be governed by the laws of the State of California.

-3-

EXHIBIT A

Percentage of
Name Stock Allocation
-------------------------------------------------- ------------------

Xxxxxxx X. Xxxxxxx 50%
Xxxxxx X. Xxxxx 50%

41
EXHIBIT D

COMPANY SCHEDULE OF EXCEPTIONS

This Schedule of Exceptions, dated as of June __, 1996, is made and
given pursuant to Article II of the Agreement and Plan of Reorganization by and
among EDnet, Inc., EDN Sub, Inc. and Internet Worldwide Business Solutions (the
"Agreement and Plan of Reorganization"). The Section numbers in this Schedule of
Exceptions correspond to the Section numbers in the Agreement and Plan of
Reorganization; however, any information disclosed herein shall be deemed to be
disclosed and incorporated into any other Section number under the Agreement and
Plan of Reorganization where such disclosure would be appropriate. Any terms
defined in the Agreement and Plan of Reorganization shall have the same meaning
when used in this Schedule of Exceptions as when used in the Agreement and Plan
of Reorganization unless the context otherwise requires.

2.7 In September 1995, in accordance with the terms of the sale of the
Music Connection System, the Company sold a trademark (registered in May, 1996)
called Music Connection to Alliance Entertainment Corp.

2.11 The Company is in the process of negotiating the purchase of two
Oracle databases for less than Ten Thousand Dollars ($10,000) for existing
clients.

EXHIBIT E

PARENT AND MERGER SUB SCHEDULE OF EXCEPTIONS

This Schedule of Exceptions, dated as of June 21, 1996, is made and
given pursuant to Article III of the Agreement and Plan of Reorganization by and
among EDnet, Inc., EDN Sub, Inc. and Internet Worldwide Business Solutions (the
"Agreement and Plan of Reorganization"). The Section numbers in this Schedule of
Exceptions correspond to the Section numbers in the Agreement and Plan of
Reorganization; however, any information disclosed herein shall be deemed to be
disclosed and incorporated into any other Section number under the Agreement and
Plan of Reorganization where such disclosure would be appropriate. Any terms
defined in the Agreement and Plan of Reorganization shall have the same meaning
when used in this Schedule of Exceptions as when used in the Agreement and Plan
of Reorganization unless the context otherwise requires.

3.3 CASH CONSIDERATION. EDnet has less than $500,000 cash on-hand as of
6/21/96. However, as evidenced by attached commitments from its Investment
Bankers and their supporting Investors, EDnet anticipates that it will have well
in excess of this amount within the next few weeks. EDnet is also willing to
pledge via its "use of funds" or "cash flow projections" attached hereto, that
it will be able to meet the commitment of the first $250,000 cash payment as
anticipated within the 60 day period referred to in this Agreement.

3.4 PARENT FINANCIAL STATEMENTS. April statements have not yet been
completed, since audit of all EDnet records for 3 years has been absorbing
primary Finance Dept. priorities. March 31, 1996 statements have been provided
as a substitute.

EXHIBIT F-1

FORM OF EMPLOYMENT AGREEMENT (XXXXX)

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT dated the 24th day of June, 1996 (the
"Employment Agreement") by and among EDNET, INC., a Colorado corporation,
formerly AP OFFICE EQUIPMENT, INC. ("EDnet"), INTERNET WORLDWIDE BUSINESS
SOLUTIONS, a California corporation, and a wholly-owned subsidiary of EDnet
("Employer" or the "Corporation"), and Xxxxxx Xxxxx, of 000 Xxxx Xxxxx Xx., #00,
Xxxxx Xxxx, Xxxxxxxxxx 00000 ("Employee").

In consideration of the premises and mutual promises contained herein,
and of the provisions of that certain Agreement and Plan of Reorganization,
EDnet, the Corporation and the Employee hereby agree as follows:

1. TERM OF EMPLOYMENT. This Agreement shall remain in force from the
date hereof until the 30th day of June, 1999 (the "Expiration Date") unless
sooner terminated in accordance with Section 5 (the "Term"). In consideration
for Employee's provision of services specified in Section 2 hereof for the Term,
it is understood and agreed that Employer shall pay the monthly compensation
specified in Section 3 hereof for the Term.

2. EMPLOYMENT DUTIES. Employee shall serve as President and Chief
Technical Officer of the Corporation for the term of employment of Employee
under this Employment Agreement. In his capacity as an officer, Employee shall
have such authority as is delegated to him by the Board of Directors of the
Corporation. During the Term, Employee shall faithfully perform the duties
assigned to him and shall devote his full time and attention to, and use his
best efforts in the furtherance of, the business of the Corporation. The
foregoing authority and duties shall be consistent with Employee's authority and
duties as an officer of the Corporation. Employee shall also serve on the Board
of Directors of both the Corporation and EDnet.

3. COMPENSATION. In consideration of the services to be rendered by
Employee under this Employment Agreement, the Corporation agrees to pay, and
Employee agrees to accept, the following compensation:

A. BASE SALARY. The Corporation shall pay Employee a base
salary at the annual rate of One Hundred Thousand Dollars ($100,000) for the
first twelve months of employment, to be increased thereafter at the discretion
of the Compensation Committee of the Board of Directors of EDnet. The base
salary shall be payable in equal semi-monthly installments, subject only to
applicable withholding requirements. No overtime pay will be paid to Employee by
the Corporation.

B. BONUSES. In addition to Employee's base salary hereunder,
as additional compensation, the Corporation shall pay bonuses to Employee at the
discretion of the Compensation Committee of the Board of Directors of EDnet.

C. REIMBURSEMENT OF EXPENSES. The Corporation shall promptly
reimburse Employee for reasonable out-of-pocket expenses that the Employee may
incur in connection with his services for the Corporation. Employee shall
provide to the Corporation supporting documentation sufficient to satisfy
reporting requirements of the Internal Revenue Service and in such form as is
reasonably satisfactory to the Corporation.

D. EMPLOYEE BENEFITS. Employee shall be entitled to
participate in such employee benefit plans, including group pension, life and
health insurance and other medical benefits, and shall receive all other fringe
benefits, as EDnet and the Corporation may make available to employees during
the term of employment of Employee. In addition, the Corporation shall continue
to maintain and provide disability insurance at the levels currently in effect.

4. VACATION. Employee shall be entitled to accrue vacation leave equal
to one and one-quarter (1 1/4) days at full pay for each one (1) month period of
completed service during the Term (with unused days being carried forward
indefinitely), and may take such accrued vacation days at such times as he may
wish, subject to Employee's arranging such vacations so as not materially to
affect adversely the ability of the Corporation to transact its necessary
business and provided, further, that Employee shall not take vacations totalling
more than twenty-five (25) business days during any calendar year and shall take
no single vacation of more than fifteen (15) consecutive business days.

5. TERMINATION. The employment of Employee under this Employment
Agreement shall terminate on the first to occur of the following:

A. On the Expiration Date as provided in Section 1.

B. Upon the death of Employee or in the event of permanent
disability of Employee, at the option of the Corporation, upon ninety (90) days
written notice by the Corporation. For the purposes of this Employment
Agreement, Employee will be deemed to be permanently disabled in the event that
competent medical authority, acceptable to the Corporation, opines that it is
improbable that Employee will ever be able to resume his usual or ordinary
duties for and on behalf of the Corporation.

C. This Agreement may be terminated by the Board of Directors
of the Corporation for Employee's willful misconduct, habitual neglect of duties
or breach of a material provision of this Agreement. In the case of termination
for willful misconduct or habitual neglect of duties, Employee shall be given at
least one (1) written notice describing in reasonable detail the perceived
deficiencies in Employee's performance, and Employee shall be given at least
thirty (30) days' opportunity to correct such perceived deficiencies prior to
any termination. In the case of termination for breach of this Agreement,
Employee shall be given written notice describing in reasonable detail the
alleged breach, and Employee shall have thirty (30) days in which to cure such
breach.

D. At the election of Employee, in the event of the sale or
transfer of substantially all of the business or assets of the Corporation or
EDnet, or control thereof, provided that Employee shall provide 30 days' prior
written notice of termination.

E. At the election of either party upon thirty (30) days prior
written notice to the other.

6. PAYMENT UPON TERMINATION.

A. If the employment of Employee is terminated by death, or
because of disability, pursuant to Section 5(b) hereof, the Corporation shall
pay to the estate of Employee or to Employee, as the case may be, the
compensation which would otherwise be payable to Employee at the end of the
month in which his death or the termination of his employment because of
disability occurs, compensation for accrued vacation days and reimbursement for
unreimbursed expenses. The Estate or Employee shall not be entitled to severance
pay or future Employer insurance contributions for Employee benefits.

B. In the event that the employment of Employee is terminated
at the election of the Corporation pursuant to Sections 5(c) or 5(e) hereof, or
at the election of Employee pursuant to Sections 5(c) or 5(e) hereof, or at the
election of Employee pursuant to Section 5(e) hereof, Employee shall be entitled
to continuation of his base salary then in effect and Employer insurance
contributions for Employee benefits for six (6) months from the last day of
actual employment or the date of termination, whichever is earlier. Employee
shall also be entitled to compensation for accrued vacation days and
reimbursement for unreimbursed expenses.

C. If the employment of Employee is terminated on the
Expiration Date pursuant to Section 5(a), or in the event Employee elects to
terminate his employment pursuant to the provisions of Section 5(e) hereof,
Employee shall be entitled to compensation for accrued vacation days and
reimbursement for unreimbursed expenses.

7. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. Employee agrees both
during and after employment by the Corporation, not to use (except in the course
of employment) or disclose to others, except with the Corporation's prior
written consent, any Confidential Information. Confidential Information shall
include, but not be limited to, trade secrets, technical data including computer
programs, financial data, future plans, business strategy and information
received from third parties under disclosure restrictions, which Employee has
acquired by reason of his employment by the Corporation, or which Employee had
developed in the course of such employment. Confidential Information does not
include: (i) information that at the time of disclosure is in the public domain
through no fault of Employee; (ii) information received from a third party
outside of the Corporation that was disclosed without a breach of any
confidentiality obligation; (iii) information approved for release by written
authorization of the Corporation; (iv) information that may be required by law
or by order of any court, agency or proceeding to be disclosed; or (v)
information which subsequently becomes part of the public domain without any
breach by Employee.

8. POSSESSION AND SURRENDER OF CONFIDENTIAL INFORMATION AND DOCUMENTS.
Employee hereby acknowledges the Corporation's right to possession and title in
and to all Confidential Information and all papers, documents, tapes, drawings,
computer programs, computer software or other records prepared by Employee
during his employment, or provided by the Corporation, or which otherwise come
into Employee's possession by reason of his employment by the Corporation, or
which Employee may have written or created while employed by the Corporation.
Employee agrees not to make or permit to be made, except in pursuance of
Employee's duties hereunder, any copies of such materials. Employee further
agrees to deliver to the Corporation, upon request, all such materials in
Employee's possession.

9. INTELLECTUAL PROPERTY RIGHTS.

A. All right, title, and interest of every kind and nature,
whether now known or unknown, in and to any intellectual property, including,
but not limited to, any invention, patents, trademarks, service marks,
copyrights, films, scripts, ideas, creations, computer software and properties
invented, created, written, developed, furnished, produced, or disclosed by
employee, in the course of rendering services to Employer under and pursuant to
this agreement shall, as between Employer and Employee, be and remain the sole
and exclusive property of Employer for any and all purposes and uses, and
Employee shall have no right, title, or interest of any kind or nature in or to
such property, or in or to any results and/or proceeds from such property.

B. The provisions of this Agreement requiring the assignment
of inventions to Employer do not apply to any invention which qualifies under
the provisions of California Labor Code Section 2870 (attached hereto as Exhibit
A).

10. NON-COMPETITION.

A. For a period of one (1) year following the date of the
termination of this Agreement, Employee agrees that he shall not at any time,
directly or indirectly, within any county, city or part thereof and other areas
in the United States of America (collectively, the "Locations"), so long as the
Corporation continues to be engaged in the same or similar business or activity
(the "Business") in such Location.

I. own, manage, operate, control, or be connected in
any manner with the ownership, management, operation or control of any person or
entity that engages in the same type of business as the Business or engages in a
business competitive with the Business (a "Competitive Business"), which
includes but is not limited to, acting as a director, officer, agent, employee,
consultant, partner or stockholder of a Competitive Business;

II. engage in any activity which is the same as or in
competition with the Business;

III. interfere with, disrupt or attempt to disrupt
the business relationship, contractual, employment or otherwise, between the
Corporation and any customer

or prospective customer, supplier, lessee or employee of the Corporation,
including without limitation the customers and suppliers of the Business prior
to the date hereof,

IV. solicit employment for or of employees of the
Corporation or induce any employee to leave the employ of the Corporation,

V. lend or allow his name or reputation to be used by
or in connection with any Competitive Business; or

VI. otherwise allow his skill, knowledge or
experience to be used in or by any Competitive Business.

B. Notwithstanding anything in this Agreement to the contrary,
nothing in this Agreement shall limit the right of Employee as an investor to
hold or make investments not in excess of 5% of the outstanding securities of
any corporation.

C. The parties hereto intend that the covenants set forth in
Sections 10(a) shall be construed as a series of separate covenants, each
consisting of the covenants set forth in Section 10(a) for each of the
Locations. Except for such Locations, all such separate covenants shall be
deemed identical.

D. In the event that this Agreement is terminated pursuant to
Section 5 hereof, other than the termination by Employee pursuant to Section
5(d) or by the Corporation pursuant to Section 5(e), the provisions of Sections
10 shall survive such termination. Section 10(a) shall terminate and be of no
force or effect in the event the Corporation breaches this Agreement and fails
to cure such breach within thirty (30) days of receipt of written notice
thereof.

11. REMEDIES. The Corporation and Employee agree that the services of
Employee are of a personal, special, unique, and extraordinary character, and
cannot be replaced by the Corporation without great difficulty, and that the
violation of Employee of any of his agreements under Section 9 would damage the
goodwill of the Corporation and cause the Corporation irreparable harm which
could not reasonably or adequately be compensated in damages in an action at
law, and that the agreements of Employee under Section 9 may be enforced by the
Corporation in equity by an injunction or restraining order in addition to being
enforced by the Corporation at law.

12. NOTICE. All notices under this Employment Agreement shall be in
writing. Notice intended for the Corporation shall be sent by registered or
certified mail, postage prepaid, return receipt requested, to the address of the
Corporation set forth above or such other address as the Corporation may
hereafter designate in writing. Notice intended for Employee shall be delivered
to Employee by hand or sent by registered or certified mail, postage prepaid,
return receipt requested, to the address of Employee set forth above or such
other address as Employee may hereafter designate in writing.

13. ASSIGNMENT. The rights and obligations of the Corporation under
this Employment Agreement shall inure to the benefit of, and shall be binding
upon, the successors and assigns of the Corporation. The rights and obligations
of Employee under this Employment Agreement shall inure to the benefit of, and
shall be binding upon, the heirs, executors, and legal representatives of
Employee.

14. ENTIRE AGREEMENT. This Employment Agreement supersedes any and all
other agreements, either oral or in writing, between the parties hereto with
respect to the employment of Employee by the Corporation and contains all of the
covenants and agreements between the parties with respect to such employment.
Each party to this Employment Agreement acknowledges that no representations,
inducements, promises, or agreements, oral or otherwise, have been made by any
party, or any one acting on behalf of any party, which are not embodied herein,
and that no other agreement, statement, or promise not contained in this
Employment Agreement shall be valid and binding. Any modification of this
Employment Agreement will be effective only if it is in writing signed by both
parties to this Employment Agreement.

15. SEVERABILITY. If any provision in this Employment Agreement is held
by a court of competent jurisdiction to be invalid, void, or unenforceable, the
remaining provisions shall nevertheless continue in full force and effect
without being impaired or invalidated in any way.

16. ATTORNEYS' FEES. In the event that any action is filed in relation
to this Agreement, the unsuccessful party in the action shall pay to the
successful party, in addition to all the sums that either party may be called on
to pay, a reasonable sum for the successful party's attorney's fees.

17. GOVERNING LAW. This Employment Agreement shall be governed by, and
construed in accordance with, the laws of the State of California.

9.
50

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

EDNET, INC.

By /s/ Xxx Xxxxxxxxx
------------------------------------------
Xxx Xxxxxxxxx, Chairman and CEO

INTERNET WORLDWIDE BUSINESS SOLUTIONS

By /s/Xxxxxxx Xxxxxxx
------------------------------------------
Xxxxxxx Xxxxxxx, Chief Executive Officer

EMPLOYEE

/s/Xxxxxx Xxxxx
---------------------------------------------
Xxxxxx Xxxxx

10.
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EXHIBIT A

CALIFORNIA LABOR CODE SECTION 2870

EMPLOYMENT AGREEMENTS; ASSIGNMENT OF RIGHTS

"(a) Any provision in an employment agreement which provides that an
employee shall assign, or offer to assign, any of his or her rights in an
invention to his or her employer shall not apply to an invention that the
employee developed entirely on his or her own time without using the employer's
equipment, supplies facilities, or trade secret information except for those
inventions that either:

(1) Relate at the time of conception or reduction to practice
of the invention to the employer's business, or actual or demonstrably
anticipated research or development of the employer.

(2) Result from any work performed by the employee for the
employer.

(b) To the extent a provision in an employment agreement purports to
require an employee to assign an invention otherwise excluded from being
required to be assigned under subdivision (a), the provision is against the
public policy of this state and is unenforceable."

11.
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EXHIBIT F-2

FORM OF EMPLOYMENT AGREEMENT (XXXXXXX)

12.
53

EMPLOYMENT AGREEMENT

In consideration of the premises and mutual promises contained herein,
and of the provisions of that certain Agreement and Plan of Reorganization,
EDNet, the Corporation and the Employee hereby agree as follows:

3. COMPENSATION. In consideration of the services to be rendered by
Employee under this Employment Agreement, the Corporation agrees to pay, and
Employee agrees to accept, the following compensation:

13.
54

5. TERMINATION. The employment of Employee under this Employment
Agreement shall terminate on the first to occur of the following:

A. On the Expiration Date as provided in Section 1.

14.
55

E. At the election of either party upon thirty (30) days prior
written notice to the other.

6. PAYMENT UPON TERMINATION.

15.
56

9. INTELLECTUAL PROPERTY RIGHTS.

10. NON-COMPETITION.

II. engage in any activity which is the same as or in
competition with the Business;

III. interfere with, disrupt or attempt to disrupt
the business relationship, contractual, employment or otherwise, between the
Corporation and any customer

16.
57

or prospective customer, supplier, lessee or employee of the Corporation,
including without limitation the customers and suppliers of the Business prior
to the date hereof;

IV. solicit employment for or of employees of the
Corporation or induce any employee to leave the employ of the Corporation;

V. lend or allow his name or reputation to be used by
or in connection with any Competitive Business; or

VI. otherwise allow his skill, knowledge or
experience to be used in or by any Competitive Business.

17.
58

17. GOVERNING LAW. This Employment Agreement shall be governed by, and
construed in accordance with, the laws of the State of California.

18.
59

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

EDNET, INC.

By/s/Xxx Xxxxxxxxx
------------------------------------------
Xxx Xxxxxxxxx, Chairman and CEO

INTERNET WORLDWIDE BUSINESS SOLUTIONS

By/s/Xxxxxx Xxxxx
------------------------------------------
Xxxxxx Xxxxx, President and Chief
Technical Officer

EMPLOYEE

/s/Xxxxxxx Xxxxxxx
---------------------------------------------
Xxxxxxx Xxxxxxx

19.
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EXHIBIT G

SCHEDULE OF EMPLOYEE STOCK OPTIONS

NUMBER OF
EMPLOYEE OPTION SHARES

Xxxxxxx Xxxxxxxx 30,000
One or more future hires in programming resources 30,000
------
Total: 60,000

20.
61

EXHIBIT H

CONTINUITY OF INTEREST CERTIFICATE

21.
62

EDNET, INC.

CONTINUITY OF INTEREST CERTIFICATE

June 24, 1996

THE UNDERSIGNED, in accordance with Section 6.2(e) of the Agreement and
Plan of Reorganization (the "Agreement") dated as of June 24, 1996, by and among
EDNET, INC. ("EDNET"), its wholly-owned subsidiary, EDN SUB, INC. ("Merger Sub")
and INTERNET WORLDWIDE BUSINESS SOLUTIONS ("IBS") hereby certifies and
represents that the following facts are now true and will continue to be true as
of the Closings(1):

1. The fair market value of the EDNET stock and other consideration
received by each IBS stockholder will be approximately equal to the fair market
value of the IBS stock surrendered in the exchange.

2. Merger Sub will acquire at least 90 percent of the fair market value
of the net assets and at least 70 percent of the fair market value of the gross
assets held by IBS immediately prior to the transaction. For purposes of this
representation, amounts paid by IBS to dissenters, amounts paid by IBS to
stockholders who receive cash or other property, IBS assets used to pay its
reorganization expenses, and all redemptions and distributions (except for
regular, normal dividends) made by IBS during the period beginning with the
commencement of negotiations (formal or informal) between representatives IBS
and EDNET and ending on the Closing Date (the "Pre-Merger Period"), will be
included as assets of IBS held immediately prior to the transaction.

3. Prior to the transaction, EDNET will be in control of Merger Sub
within the meaning of Section 368(c) of the Code.

4. Following the transaction, Merger Sub will not issue additional
shares of its stock that would result in EDNET losing control of Merger Sub
within the meaning of Section 368(c) of the Code.

5. EDNET has no plan or intention to reacquire any of its stock issued
in the transaction.

6. EDNET has no plan or intention to liquidate Merger Sub; to merge
Merger Sub with and into another corporation; to sell or otherwise dispose of
the stock of Merger Sub; or to cause Merger Sub to sell or otherwise dispose of
any of the assets of IBS acquired in the transaction, except for dispositions
made in the ordinary course of business or transfers described in Section
368(a)(2)(C) of the Code.

--------
(1) Unless otherwise indicated, capitalized terms not defined herein have
the meanings set forth in the Agreement.

22.
63

7. Following the transaction, Merger Sub will continue the historic
business of IBS or use a significant portion of IBS's business assets in a
business.

8. There is no intercorporate indebtedness existing between EDNET and
IBS or between Merger Sub and IBS that was issued, acquired, or will be settled
at a discount.

9. Neither EDNET nor Merger Sub is an investment company as defined in
Section 368(a)(2)(F)(iii) and (iv) of the Code.

10. No stock of Merger Sub will be issued in the transaction.

11. Following the transactions contemplated by the Agreement, EDNET and
Merger Sub will file their tax returns and reports in a manner consistent with
the treatment of the transactions contemplated by the Agreement as a tax-free
reorganization under Section 368(a) of the Code.

EDNET, INC. EDN SUB, INC.

By: /s/Xxx Xxxxxxxxx By:/s/Xxx Xxxxxxxxx
-------------------------------- ------------------------
Xxx Xxxxxxxxx Xxx Xxxxxxxxx
Chairman and CEO Chairman and CEO

23.
64

EXHIBIT I-1

OWNERSHIP CERTIFICATE (XXXXX)

24.
65

OWNERSHIP CERTIFICATE

The undersigned, Xxxxxx Xxxxx, immediately prior to the closing of the
Agreement and Plan of Reorganization by and among EDnet, Inc., EDN Sub, Inc.,
and Internet Worldwide Business Solutions (the Agreement and Plan of
Reorganization) hereby certifies that:

1. He owns, of record and beneficially, 25,000 shares of Common Stock
of Internet Worldwide Business Solutions (the "Company") free and clear of all
liens, encumbrances, pledges, claims, options, changes and assessments of any
nature whatsoever, with full right and lawful authority to transfer such shares
pursuant to the terms of the Agreement and Plan of Reorganization. There exists
no voting agreement, voting trust, or outstanding proxy with respect to any of
such shares. There are no outstanding rights, options, warrants, calls,
commitments, or any other agreements of any character, whether oral or written
with respect to such shares.

2. The only other outstanding securities of the Company are 25,000
shares of Common Stock held by Xxxxxxx Xxxxxxx.

3. He is acquiring the Merger Consideration (as defined in the
Agreement and Plan of Reorganization) for his own account, for investment
purposes only, and not with a view to the sale or distribution of any part
thereof, and he has no present intention of selling, granting participation in
or otherwise distributing the same. Seller understands the specific risks
related to the Merger Consideration, especially as it relates to the financial
performance of EDnet, Inc.

IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Ownership as of June 24, 1996.

/s/Xxxxxx Xxxxx
-----------------------------------
Xxxxxx Xxxxx

25.
66

EXHIBIT I-2

OWNERSHIP CERTIFICATE (XXXXXXX)

26.
67

OWNERSHIP CERTIFICATE

The undersigned, Xxxxxxx Xxxxxxx, immediately prior to the closing of
the Agreement and Plan of Reorganization by and among EDnet, Inc., EDN Sub,
Inc., and Internet Worldwide Business Solutions (the Agreement and Plan of
Reorganization) hereby certifies that:

2. The only other outstanding securities of the Company are 25,000
shares of Common Stock held by Xxxxxxx Xxxxxxx.

IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Ownership as of June 24, 1996.

/s/Xxxxxxx Xxxxxx
-----------------------------------
Xxxxxxx Xxxxxxx

27.

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BY AND AMONG EDNET, INC.,

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