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<SEC-DOCUMENT>0001021771-03-000107.txt : 20030530
<SEC-HEADER>0001021771-03-000107.hdr.sgml : 20030530
<ACCEPTANCE-DATETIME>20030530112929
ACCESSION NUMBER:		0001021771-03-000107
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20030528
ITEM INFORMATION:		Acquisition or disposition of assets
ITEM INFORMATION:		Financial statements and exhibits
FILED AS OF DATE:		20030530

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			DCAP GROUP INC/
		CENTRAL INDEX KEY:			0000033992
		STANDARD INDUSTRIAL CLASSIFICATION:	HOTELS & MOTELS [7011]
		IRS NUMBER:				362476480
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-01665
		FILM NUMBER:		03724745

	BUSINESS ADDRESS:	
		STREET 1:		90 MERRICK AVE
		STREET 2:		9TH FLOOR
		CITY:			EAST MEADOW
		STATE:			NY
		ZIP:			11554
		BUSINESS PHONE:		5167946300

	MAIL ADDRESS:	
		STREET 1:		90 MERRICK AVE 9TH FLOOR
		STREET 2:		90 MERRICK AVE 9TH FLOOR
		CITY:			EAST MEADOW
		STATE:			NY
		ZIP:			11554

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	EXTECH CORP
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	EXECUTIVE HOUSE INC
		DATE OF NAME CHANGE:	19911119
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>k8_52303.txt
<DESCRIPTION>FORM 8-K FOR AN EVENT DATED MAY 28, 2003
<TEXT>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                      ------

                                    FORM 8-K

                                 CURRENT REPORT

                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934


                          Date of Report: May 28, 2003
                        (Date of earliest event reported)



                                DCAP GROUP, INC.
                                ----------------
               (Exact name of Registrant as specified in charter)



      Delaware                       0-1665                   36-2476480
  ---------------              --------------------      ---------------------
(State or other jurisdiction   (Commission File No.)       (IRS Employer
incorporation)                                           Identification Number)


                     1158 Broadway, Hewlett, New York 11557
                     --------------------------------------
               (Address of principal executive offices) (Zip Code)


       Registrant's telephone number, including area code: (516) 374-7600
                                                           --------------











<PAGE>

Item 2. Acquisition or Disposition of Assets.

     On  May  28,  2003,  DCAP  Group,  Inc.   ("DCAP"),   through  an  indirect
wholly-owned  subsidiary,  acquired  substantially  all  of  the  assets  of AIA
Acquisition Corp.  ("AIA"), an insurance brokerage firm with six offices located
in eastern Pennsylvania. The salient terms of the acquisition are as follows:

     -    A base  purchase  price of  $737,647  (which  represents  69% of AIA's
          includeable  commission  income for the 12 months ended March 31, 2002
          or the year ended  December 31,  2002,  whichever  was less),  plus an
          amount  equal to  AIA's  collected  accounts  receivable  and  prepaid
          expenses.  The  purchase  price is payable in DCAP  Series A Preferred
          Stock.  The  Series  A  Preferred  Stock  carries  a 5%  dividend,  is
          convertible  into DCAP Common Stock at a conversion  price of $.50 per
          share and is  redeemable  on April 30, 2007 (or sooner  under  certain
          circumstances).

     -    Additional  cash  consideration  based upon the EBITDA of the combined
          operations  of AIA and DCAP's  wholly-owned  subsidiary,  Barry  Scott
          Companies Inc., during the five year period ending April 30, 2008. The
          additional consideration cannot exceed an aggregate of $335,000.

     Barry B. Goldstein,  Chief  Executive  Officer of DCAP, is President of AIA
and members of his family are  principal  stockholders  of AIA. The terms of the
acquisition  were the result of arm's length  negotiations  between DCAP and AIA
and were based upon the sales price of stores to persons who are not  affiliated
with DCAP and current market conditions.

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

     (a) Financial Statements of Businesses Acquired.

          The  financial  statements  required by this item are not  included in
     this initial  report on Form 8-K but will be filed by  amendment  not later
     than 60 days  after  the  date  that  this  initial  report  on Form 8-K is
     required to be filed.

          (b) Pro Forma Financial Information.

          The pro  forma  financial  information  required  by this  item is not
     included in this initial  report on Form 8-K but will be filed by amendment
     not later than 60 days after the date that this initial  report on Form 8-K
     is required to be filed.

                                       2
<PAGE>

          (c) Exhibits.

              Exhibit No.       Description

               2.1              Asset  Purchase  Agreement  dated May  28,  2003
                                by  and  among  AIA-DCAP Corp., DCAP Group, Inc.
                                and AIA Acquisition Corp.

               4.1              Certificate  of   Designations  of   Series  A
                                Preferred Stock.


                                       3
<PAGE>







                                   SIGNATURES

     Pursuant to the  requirements  of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.


                                               DCAP GROUP, INC.


Dated: May 30, 2003                            By: /s/ Morton L. Certilman
                                                  -----------------------------
                                                  Morton L. Certilman
                                                  Secretary






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-2
<SEQUENCE>3
<FILENAME>ex2_1.txt
<DESCRIPTION>EX 2.1 ASSET PURCHASE AGREEMENT
<TEXT>
     ASSET  PURCHASE  AGREEMENT,  entered  into on May 28, 2003 (the  "Execution
Date")  but  effective  as of the  close of  business  on April  30,  2003  (the
"Effective Date") (the "Agreement"), by and among AIA-DCAP CORP., a Pennsylvania
corporation ("Purchaser"),  DCAP GROUP, INC., a Delaware corporation ("Parent"),
and AIA ACQUISITION CORP., a Pennsylvania corporation ("Seller").

                                    RECITALS

     Seller is  engaged in the  following  businesses:  (i)  retail  automotive,
commercial,  homeowners,  and life and heath insurance brokerage;  (ii) roadside
assistance; and (iii) tag and title services (collectively, the "Business").

     Seller  desires to sell, and Purchaser  desires to purchase,  substantially
all of Seller's assets on the terms and conditions of this Agreement.

     NOW,  THEREFORE,  in  consideration  of the  recitals  and  the  respective
covenants,  representations,  warranties and agreements  herein  contained,  and
intending  to be legally  bound  hereby,  the  parties  hereto  hereby  agree as
follows:

                                    ARTICLE I

                                PURCHASE AND SALE

1.1  Sale of Assets. At the Closing (as hereinafter  defined),  upon and subject
to the terms and conditions of this Agreement, Seller shall grant, sell, convey,
assign,  transfer and deliver to Purchaser all of its right,  title and interest
in and to all of its assets,  properties  and rights  (other  than the  Excluded
Assets, as hereinafter defined) (collectively,  the "Assets"), free and clear of
all mortgages, liens, pledges, security interests, charges, claims, restrictions
and encumbrances of any nature whatsoever (collectively, "Liens").

     1.1.1 Included Assets. The Assets shall include, without limitation, all of
Seller's right, title and interest in and to the following:

          (a)  all fixed assets,  including,  without limitation,  machinery and
               equipment,   supplies,   computer   hardware,   electronic   data
               processing equipment, furniture, vehicles, and all other personal
               property, of every kind and nature whatsoever, owned by Seller on
               the Closing Date (collectively,  "Personal  Property"),  wherever
               located, including, without limitation, the Personal Property set
               forth on Schedule 2.15 attached hereto;

          (b)  except to the extent  constituting  Excluded Assets, all Accounts
               (as such term is defined in the  Uniform  Commercial  Code of the
               State of New York (the "UCC")),  including,  without  limitation,
               commissions and fees receivable;

          (c)  all  prepaid  expenses,   advances  and  deposits  (collectively,
               "Prepaid Expenses");



<PAGE>



          (d)  all  rights  of  Seller  under  contracts,   agreements,  leases,
               arrangements,   commitments,   understandings   and   obligations
               (collectively,  "Contracts"),  including, without limitation, the
               Contracts  listed and described on Schedule 2.14 attached  hereto
               and including, without limitation, Seller's rights under and with
               respect to nondisclosure,  noncompetition,  and other restrictive
               covenant provisions thereunder, and all rights to receive renewal
               commissions (other than the Excluded  Commissions (as hereinafter
               defined));

          (e)  to the  extent  transferable,  all  rights  of  Seller  under all
               permits,    licenses,    orders,    franchises,     certificates,
               registrations  and approvals  (collectively,  "Permits") from all
               Federal, state and local governmental and other regulatory bodies
               (collectively,  "Bodies"),  including,  without  limitation,  the
               Permits set forth on Schedule 2.16 attached hereto;

          (f)  all inventions,  patents, trademarks,  service marks, copyrights,
               trade dress, logos, trade names,  corporate names, trade secrets,
               confidential business information (including, without limitation,
               customer and supplier lists,  pricing and cost  information,  and
               business and marketing plans and proposals),  computer  software,
               domain names,  URLs,  websites,  other  proprietary  rights,  all
               applications   relating  to  the   registration  of  any  of  the
               foregoing,   and  all  other  rights  and  interests  related  to
               intellectual   property,  all  copies  and  tangible  embodiments
               thereof,  in whatever  form or medium,  including  the  exclusive
               right to use any trade  name  under  which  Seller  operates  the
               Business and any  derivative  thereof,  all  goodwill  associated
               therewith and with the Business, licenses and sublicenses granted
               and  obtained  with  respect  thereto,   and  rights  thereunder,
               remedies against infringements  thereof, and rights to protection
               of  interests   therein  under  the  laws  of  all  jurisdictions
               (collectively,   "Intellectual  Property"),   including,  without
               limitation,  the Intellectual Property set forth on Schedule 2.11
               attached hereto;

          (g)  all of Seller's purchase,  marketing and sales records,  supplier
               records,  lists and other documents,  files, manuals and records,
               correspondence,  customer  and  supplier  lists,  customer  data,
               production  records,  employment  records,  and any  confidential
               information which has been reduced to writing,  wherever located,
               with respect to, or in connection with, Seller or the Business;

          (h)  all of Seller's rights and choses in action,  including,  without
               limitation,  all rights under express or implied  warranties from
               suppliers and vendors with respect to the Business and all rights
               to receive insurance proceeds;

                                       2

<PAGE>


          (i)  all written technical information, data, specifications, research
               and development  information,  engineering drawings and operating
               and maintenance manuals;

          (j)  all of Seller's goodwill associated with the Business,  including
               Seller's  right to use its  trade  name  and  trade  styles,  and
               telephone and fax numbers, together with any and all variants and
               derivatives  thereof,  including,  without limitation,  the names
               "Atlantic  Insurance  Agency,"  "Lowest 1 Agency" and  "Pennstone
               Agency;"

          (k)  all other intangible assets;

          (l)  all information, files, books, records, data, plans, and recorded
               knowledge  related  to the  foregoing  (collectively,  "Books and
               Records");

          (m)  all proceeds and products of each of the foregoing; and

          (n)  all other assets of Seller (other than the Excluded Assets).

     1.1.2 Excluded Assets.  Notwithstanding the foregoing, the Assets shall not
include any of the following (collectively, the "Excluded Assets"):

          (a)  Seller's rights under this Agreement;

          (b)  Seller's minute books;

          (c)  Seller's franchise to be a corporation;

          (d)  all cash and cash equivalents;

          (e)  Seller's rights with respect to the real property owned by it, as
               set forth on Schedule 2.13 attached hereto; and

          (f)  all rights to  renewal  commissions  payable  during the one year
               period  following  the Closing with respect to the  operations of
               the Excluded Store (as hereinafter defined), net of cancellations
               (the "Excluded Commissions").

     1.1.3 Third Party  Consents.  To the extent that Seller's  rights under any
Contract, Permit or other Asset to be assigned to Purchaser hereunder may not be
assigned without the consent of another person which has not been obtained, this
Agreement  shall not  constitute an agreement to assign the same if an attempted
assignment would constitute a breach thereof or be unlawful,  and Seller, at its
expense,  shall use its best efforts to obtain any such  required  consent(s) as
promptly  as  possible.  If any such  consent  shall not be  obtained  or if any
attempted  assignment would be ineffective or would impair Purchaser's rights in
and to the Asset in question so that Purchaser would


                                       3
<PAGE>

not in  effect  acquire  the  benefit  of all such  rights  (including,  without
limitation,  with  regard to tag and title  services as  hereinafter  provided),
Seller,  to the maximum extent  permitted by law and the Asset,  shall act after
the  Closing  as  Purchaser's  agent  in  order to  obtain  for it the  benefits
thereunder and shall  cooperate,  to the maximum extent permitted by law and the
Asset,  with Purchaser in any other reasonable  arrangement  designed to provide
such  benefits to Purchaser.  The  foregoing  shall not be construed to limit or
modify any of the conditions  precedent to Purchaser's  obligation to consummate
the  transactions  contemplated  hereby  pursuant to the provisions of Article V
hereof.

     1.1.4 Books and Records. Seller shall be entitled to keep copies of such of
the Books and Records as are necessary for tax and other governmental compliance
purposes,  subject to the  restrictions  set forth in the  Restrictive  Covenant
Agreements (as hereinafter defined).

1.2  Purchase  of  Assets.  At the  Closing,  upon and  subject to the terms and
conditions of this Agreement and in reliance on the representations,  warranties
and covenants of Seller  contained  herein,  Purchaser shall purchase the Assets
from Seller in consideration for the Purchase Price (as hereinafter defined).

1.3 Purchase Price.

     1.3.1  Purchase  Price.  The purchase  price for the Assets (the  "Purchase
Price")  shall be the sum of (a) a number of shares of Series A Preferred  Stock
of Parent  (the  "Series A  Preferred  Stock")  as  calculated  pursuant  to the
provisions of Section 1.3.2 hereof;  and (b) the  Additional  Consideration  (as
hereinafter  defined).  The Series A  Preferred  Stock  shall  have the  powers,
preferences,  rights, qualifications,  limitations and restrictions set forth in
the form of Certificate of  Designations  of Preferred  Stock attached hereto as
Exhibit 1.3.1 (the "Certificate of Designations").

     1.3.2 Series A Preferred  Stock. The number of shares of Series A Preferred
Stock to be issued to Seller hereunder shall equal

          (a)  the sum of

               (i)  sixty-nine percent (69%) of the lesser of

                    (A)(I)  $1,140,126  (which  represents  Seller's  commission
                    income for the twelve  months ended March 31,  2002,  as set
                    forth in Seller's  unaudited  financial  statements for such
                    period),  less (II) $49,651 (which represents the commission
                    income for such period  attributable  to the  operations  of
                    Seller's store located at 7001 Elmwood Avenue, Philadelphia,
                    Pennsylvania (the "Excluded Store")), or

                    (B)(I)  $1,105,176  (which  represents  Seller's  commission
                    income for the year ended December 31, 2002 ("Fiscal  2002")
                    as  set  forth  in  the  Audited  Financial  Statements  (as
                    hereinafter  defined),  less (II) $36,123 (which  represents
                    the commission income attributable to the operations of the


                                       4
<PAGE>

                    Excluded  Store for  Fiscal  2002),  calculated  in a manner
                    consistent with the calculation of commission income for the
                    twelve month period ended March 31, 2002;

               (ii) Collected  Receivables (as hereinafter  defined)  determined
pursuant to the provisions of Section 1.3.4 hereof; and

               (iii) Seller's Prepaid Expenses as of the Closing,  as determined
pursuant to the  provisions  of Section  1.3.4 hereof (the sum of (i),  (ii) and
(iii) being rounded to the nearest one thousand dollars ($1,000)),

          divided by

          (b) one thousand (1,000).

     1.3.3  Additional  Consideration.  For each twelve  (12) month  period (the
"Applicable 12 Month Period")  during the period  commencing on the Closing Date
and  ending  on the day  immediately  preceding  the five  (5) year  anniversary
thereof  (the "Five Year  Period"),  Purchaser  shall pay to Seller an amount in
cash  (collectively,  the  "Additional  Consideration")  equal to the difference
between (a) the combined EBITDA (as hereinafter  defined) of the Current AIA/BSC
Operation (as  hereinafter  defined) for such Applicable 12 Month Period and (b)
$615,000 (the  "Threshold");  provided,  however,  that the  foregoing  shall be
subject to the following:

          (i)  The  maximum  amount  payable  to  Seller  with  respect  to  any
Applicable 12 Month Period shall be $67,000.

          (ii) The maximum  aggregate  amount  payable  under this Section 1.3.3
shall be $335,000.

          (iii) Any excess  EBITDA for any  Applicable 12 Month Period shall not
be carried over and credited to Seller for any  subsequent  Applicable  12 Month
Period.

          (iv) In the event that any particular store within the Current AIA/BSC
Operation  is sold  (whether  through a sale of  assets,  including  its book of
business,  stock,  merger,  consolidation  or  otherwise)  ("Sale" or "Sold") or
closed (a "Discontinued Store") during the Five Year Period, the Threshold shall
be adjusted upward or downward as follows:

               (A) if,  during the twelve (12) month  period  ending on the last
               day of the  calendar  month  immediately  preceding  the  Sale or
               closure (the "Preceding 12 Month Period"), the Discontinued Store
               had positive  EBITDA,  then the Threshold  for the  Applicable 12
               Month Period during which the Sale or closure  occurred  shall be
               reduced  by a  dollar  amount  equal  to (I)  the  EBITDA  of the
               Discontinued  Store  for  the  Preceding  12  Month  Period  (the
               "Preceding  Period EBITDA"),  multiplied by (II) a fraction,  the
               numerator  of which shall


                                       5
<PAGE>

               be the  number  of  calendar  months  from  the  last  day of the
               Preceding  12 Month Period to the last day of the  Applicable  12
               Month Period during which the Sale or closure  occurred,  and the
               denominator  of  which  shall be 12 (the  "Remaining  Anticipated
               EBITDA");

               (B) if  the  Preceding  Period  EBITDA  was  negative,  then  the
               Threshold  for the  Applicable  12 Month Period  during which the
               Sale or  closure  occurred  shall be  increased  by the  negative
               Remaining Anticipated EBITDA;

               (C) in either event,  for purposes of computing the EBITDA of the
               Discontinued  Store in  connection  with the  computation  of the
               EBITDA for the  Current  AIA/BSC  Operation,  the Sale or closure
               shall be deemed to have occurred on the last day of the Preceding
               12 Month Period; and

               (D) the Threshold for each subsequent  Applicable 12 Month period
               shall be reduced by a dollar amount equal to the Preceding Period
               EBITDA, if positive, or increased by a dollar amount equal to the
               Preceding Period EBITDA, if negative.

     As an  illustration  of the  foregoing,  assuming that (w) an Applicable 12
Month Period ends April 30, 2005, (x) a store is sold on September 15, 2004, (y)
the EBITDA for the Discontinued Store for the 12 months ended August 31, 2004 is
$60,000, and (z) the EBITDA for the Discontinued Store for the four months ended
August 31, 2004 is $10,000, then (a) the Sale will be deemed to have occurred on
August 31, 2004;  (b) the EBITDA for the  Discontinued  Store of $10,000 for the
four months  ended  August 31, 2004 will be utilized in the  computation  of the
EBITDA for the Current  AIA/BSC  Operation  for the  Applicable  12 Month Period
ended April 30, 2005; (c) the Threshold for the Applicable 12 Month Period ended
April  30,  2005  will be  $575,000  ($615,000  - (8/12)  $60,000);  and (d) the
Threshold for the Applicable 12 Month Period ended April 30, 2006 and thereafter
will be $555,000 ($615,000 - $60,000).

          (vi) In the event that the entire  Current  AIA/BSC  Operation is Sold
and/or closed (in one or more transactions)  during the Five Year Period and the
Sale and/or  closure  results in a net profit for financial  reporting  purposes
(the  "Profit"),  then, in lieu of any further  amounts to which Seller would be
entitled  under this  Section  1.3.3,  Seller  shall be entitled to receive from
Purchaser an amount equal to the lesser of (A) such  additional  amount as would
have been payable to Seller under this Section 1.3.3 had the average  annualized
amount paid or payable to Seller  hereunder with respect to the calendar year(s)
immediately preceding the date of Sale or closure continued until the end of the
Five Year Period or (B) the Profit. In the event that the entire Current AIA/BSC
Operation is Sold and/or  closed (in one or more  transactions)  during the Five
Year Period and the Sale and/or closure does not result in a Profit,  no further
amounts shall be payable under this Section  1.3.3.  As an  illustration  of the
foregoing,  assuming that (x) the Closing of this Agreement  occurs at the close
of business on April 30, 2003, (y) the entire AIA/BSC  Operation is Sold on July
15, 2006 for a Profit of $100,000 and (z) the average  annualized amount paid or
payable to Seller under this Section  1.3.3 for  calendar  years 2003,  2004 and
2005 was $60,000  ($40,000 for the eight months in



                                       6
<PAGE>

2003  (annualized  to $60,000);  $55,000 for 2004;  and $65,000 for 2005),  then
Seller shall be entitled to receive $100,000 hereunder (representing the Profit)
since such amount  would be less than the amount  otherwise  payable  ($140,000,
calculated by assuming that the average  annualized amount of $60,000 would have
been paid for each of the full calendar  years of 2006 and 2007 and the pro rata
amount of $20,000 would have been paid for the four months in 2008).

          (vii)  For  purposes  hereof,  the  following  terms  shall  have  the
following meanings:

               (A)  "EBITDA"  shall  mean  earnings  before   interest,   taxes,
depreciation and amortization as determined on a stand-alone basis in accordance
with generally accepted accounting principles.

               (B) "Current AIA/BSC Operation" shall mean the combined operation
of the six (6) stores  currently  being  operated  by Seller  (exclusive  of the
operation  of the  Excluded  Store) and the twenty (20) stores  currently  being
operated by Barry Scott Companies,  Inc., an indirect wholly-owned subsidiary of
Parent  ("BSC"),  and/or its direct or  indirect  subsidiaries.  Any  additional
stores opened after the date hereof by Seller and/or BSC and/or their respective
subsidiaries shall not be considered part of the Current AIA/BSC Operation.

     1.3.4 Prepaid Expenses; Collected Receivables; Special Receivables.

          (a) No later  than  three  (3)  months  following  the  Closing  Date,
Purchaser shall deliver to Seller a statement (the "Prepaid Expenses Statement")
setting forth in reasonable detail  Purchaser's  calculation of Seller's Prepaid
Expenses as of the Closing.

          (b) No later  than  three  (3)  months  following  the  Closing  Date,
Purchaser  shall  deliver to Seller a statement  (the  "Receivables  Statement")
setting forth a list of all accounts receivable of Seller as of the Closing (the
"Closing  Accounts")  that, as of the two (2) month  anniversary of the Closing,
had been collected by Purchaser  ("Collected  Receivables")  or were uncollected
("Uncollected Receivables").

          (c)  Any  Uncollected   Receivables   shall  remain  the  property  of
Purchaser,  and Seller  shall have no rights  with  respect  thereto;  provided,
however, that any Uncollected Receivables that are payable on an annual basis in
arrears  ("Special  Receivables")  shall  revert to Seller on a pro rata  basis,
i.e., to the extent the Special Receivable relates to the period commencing with
the  beginning  accrual  date  thereof  and ending  with the  Closing  Date (the
"Allocable  Portion").  Purchaser  shall  execute  and  deliver  to  Seller  all
instruments as shall be reasonably  necessary to effectively  vest in Seller all
of the right,  title and  interest of Purchaser  with  respect to the  Allocable
Portion of any Special Receivables, without representation or recourse.

     1.3.5 Payment of Purchase Price.

          (a) Promptly  following  Purchaser's  delivery of the Prepaid Expenses
Statement and the  Receivables  Statement,  subject to the terms and  conditions
hereof,  Parent shall  deliver to


                                       7
<PAGE>

Seller, on account of the Purchase Price, a certificate  representing the number
of  shares  of  Series A  Preferred  Stock  calculated  in  accordance  with the
provisions of Section 1.3.2 hereof.

          (b) The  Additional  Consideration  shall be paid on an  annual  basis
within ninety (90) days  following  the end of each  Applicable 12 Month Period.
Each payment shall be  accompanied  by a statement that sets forth in reasonable
detail the calculation of the amount thereof.

     1.3.6 Disputes.

          (a) In the event Seller  disputes  Purchaser's  calculation of Prepaid
Expenses, Collected Receivables, EBITDA and/or the Threshold, it shall so notify
Purchaser  within ten (10) days of its  receipt of  Purchaser's  statement  with
respect  thereto and, if the parties are unable to resolve  such dispute  within
ten (10) days  thereafter,  such dispute  shall be  submitted to an  independent
accounting  firm  that is  mutually  acceptable  to  Purchaser  and  Seller  (an
"Independent  Accountant")  which shall  resolve the dispute  within thirty (30)
days  thereafter.  The  decision  of the  Independent  Accountant  as to Prepaid
Expenses, Collected Receivables,  EBITDA and/or the Threshold shall be final and
binding upon the parties.  The expense of the  Independent  Accountant  shall be
borne  by  Purchaser,  on the one  hand,  and  Seller,  on the  other  hand,  in
proportion  to the relative  differences  between (i) the final  position of the
parties prior to submission of the matter to the Independent Accountant and (ii)
the determination of the Independent Accountant.

          (b) Each of Purchaser and Seller shall make  available to the other on
reasonable  notice during normal business hours such of its respective Books and
Records as shall be  reasonably  required  in order for such party to verify the
calculations of the amounts provided for herein.

     1.3.7  Allocation of Purchase Price.  The Purchase Price shall be allocated
among the Assets acquired hereunder in accordance with Schedule 1.3.7 hereof. It
is agreed that the  apportionments set forth on Schedule 1.3.7 have been arrived
at by arm's length  negotiation and properly  reflect the respective fair market
values of the Assets. Seller and Purchaser each hereby covenants and agrees that
it will not take a position  on any income tax return,  before any  governmental
agency  charged  with the  collection  of any  income  tax,  or in any  judicial
proceeding that is in any way inconsistent  with the terms of this Section 1.3.7
or Schedule 1.3.7.

1.4 Assumption of Liabilities.

     1.4.1 No Assumption of Liabilities.  It is expressly  understood and agreed
that, except for the Assumed Obligations (as hereinafter  defined),  in no event
shall  Purchaser  assume or agree to pay or incur any  liability  or  obligation
under this Agreement,  including, without limitation, under this Section 1.4, or
otherwise,  in respect  of any  liability  or  obligation  of Seller  including,
without limitation, the following:

          (a) any liability based on tortious or illegal conduct,  regardless of
when made or  asserted,  which  arises  out of or is based  upon any  express or
implied  representation,  warranty,  agreement or guarantee  made by Seller,  or
alleged to have been made by  Seller,  or which is  imposed



                                       8
<PAGE>

or asserted to be imposed by  operation of law, in  connection  with any service
performed  or  product  sold by or on behalf  of  Seller,  or any claim  seeking
recovery for consequential or special damage or lost revenue or income;

          (b) any  liability or obligation  to  creditors,  lenders,  customers,
vendors or  suppliers,  or others with whom Seller has a business  relationship,
whether pursuant to a Contract or otherwise;

          (c)  any  liability  or   obligation  to  any  officer,   director  or
stockholder of Seller;

          (d) any  liability or  obligation  with  respect to, or in  connection
with, the Excluded Assets;

          (e) any  liability or  obligation  with regard to any federal,  state,
local or foreign income or other tax, including without limitation, any interest
or penalties  thereon,  (i) payable with respect to the Business,  Seller or the
Assets or (ii) incident to or arising as a  consequence  of the  negotiation  or
consummation  by  Seller of this  Agreement  and the  transactions  contemplated
hereby;

          (f)  any  liability  or  obligation  to  or  in  connection  with  any
employees,  agents or independent contractors of Seller, whether or not employed
by Seller or Purchaser after the Closing,  or under any benefit arrangement with
respect thereto;

          (g) any liability or obligation  under any Contract  pursuant to which
Seller has acquired or is to acquire any assets or properties;

          (h) any  liability  or  obligation  of Seller  arising or  incurred in
connection with the negotiation, preparation and execution of this Agreement and
the transactions  contemplated hereby, including,  without limitation,  fees and
expenses of counsel, accountants, advisors and other experts; and/or

          (i) any other liability or obligation of Seller,  whether  absolute or
contingent.

     1.4.2 Assumed  Liabilities.  As of the Closing,  Purchaser shall assume and
agree to discharge only those  obligations  arising after the Closing Date under
the Contracts described in Schedule 1.4.2 attached hereto, except that Purchaser
shall not assume any obligation or liability to the extent that it arises out of
or relates to,  directly or  indirectly,  any action or inaction of Seller on or
prior to the Closing Date (the "Assumed Obligations").

                                   ARTICLE II

                    REPRESENTATIONS AND WARRANTIES OF SELLER

     Seller makes the following  representations  and warranties to Purchaser as
of the  Execution  Date and the  Effective  Date,  each of which shall be deemed
material,  and  Purchaser,  in  executing,



                                       9
<PAGE>

delivering and consummating this Agreement,  has relied upon the correctness and
completeness of each of such representations and warranties:

2.1 Valid  Corporate  Existence;  Qualification.  Seller is a  corporation  duly
organized,  validly  existing  and  in  good  standing  under  the  laws  of the
Commonwealth  of  Pennsylvania.  Seller has the corporate power and authority to
carry on the  Business as now  conducted  and to own the  Assets.  Seller is not
required to qualify as a foreign corporation in any jurisdiction in order to own
the Assets or to carry on the Business as now conducted,  and there has not been
any claim by any  jurisdiction  to the effect that Seller is required to qualify
or otherwise be authorized to do business as a foreign corporation  therein. The
copies of Seller's  Certificate of Incorporation,  as amended to date (certified
by the Secretary of the Commonwealth of Pennsylvania),  and Seller's By-Laws, as
amended to date (certified by Seller's Secretary),  which have been delivered to
Purchaser or its counsel,  are true and complete copies of those documents as in
effect on the date hereof. The minute books of Seller, copies of which have been
delivered to Purchaser or its counsel,  contain accurate records of all meetings
of its  Board of  Directors,  any  committees  thereof  and  stockholders  since
Seller's  incorporation,  and accurately  reflect all  transactions  referred to
therein.

2.2  Capitalization.  The authorized  capital stock of Seller consists of 20,000
shares of Common Stock,  all of which are presently  issued and  outstanding and
owned  beneficially  and of record by the  persons  set  forth on  Schedule  2.2
attached hereto.  All of such issued and outstanding shares are duly authorized,
validly  issued,  fully  paid and  nonassessable.  There  are no  subscriptions,
options,  warrants,  rights or calls or other commitments or agreements to which
Seller is a party, or by which it is bound, calling for the issuance,  transfer,
sale or other  disposition of any class of securities of Seller and there are no
outstanding  securities of Seller convertible into or exchangeable for, actually
or contingently, shares of Common Stock or any other securities of Seller.

2.3  Subsidiaries.  Seller has not made any investment in, and does not own, any
of the  capital  stock of,  or any  other  proprietary  interest  in,  any other
corporation, partnership, limited liability company or other business entity.

2.4 Consents.  Schedule 2.4 attached  hereto sets forth a true and complete list
of all  consents  of  governmental  and other  regulatory  agencies,  foreign or
domestic,  and of other  parties  required  to be  received by or on the part of
Seller  to  enable  it to  enter  into and  carry  out  this  Agreement  and the
transactions contemplated hereby, including, without limitation, the transfer to
Purchaser of all of Seller's right, title and interest in and to the Assets. All
such  requisite  consents  have been,  or prior to the  Closing  will have been,
obtained.

2.5 Authority;  Binding Nature of Agreement.  Seller has the power and authority
to enter into this  Agreement and to carry out its  obligations  hereunder.  The
execution  and  delivery  of  this  Agreement  and  the   consummation   of  the
transactions  contemplated  hereby  have  been duly  authorized  by the Board of
Directors and  stockholders of Seller and no other corporate  proceedings on the
part of Seller are  necessary to authorize  the  execution  and delivery of this
Agreement and the consummation of the  transactions  contemplated  hereby.  This
Agreement  constitutes  the  valid  and  binding  obligation  of  Seller  and is
enforceable in accordance with its terms.


                                       10
<PAGE>


2.6 Financial  Statements.  The unaudited financial statements of Seller for the
twelve  (12) month  period  ended  March 31,  2002,  and the  audited  financial
statements  of Seller as of  December  31, 2002 and for the year then ended (the
"Audited Financial Statements"), copies of which are attached hereto as Schedule
2.6, (i) are true,  correct and complete,  (ii) are in accordance with the books
and records of Seller,  (iii) fairly present the financial position of Seller as
of such dates and the  results of  operations  and cash flows of Seller for such
years and period,  and (iv) were prepared in conformity with generally  accepted
accounting  principles  consistently  applied  throughout  the  periods  covered
thereby.  The Audited  Financial  Statements have been audited by A.W. Guthman &
Company, Certified Public Accountants, whose report thereon is included therein.
The commission  income figures for the Excluded  Store,  as set forth in Section
1.3.2 hereof,  are (i) are true,  correct and  complete,  (ii) are in accordance
with the books and records of Seller, and (iii) were prepared in conformity with
generally accepted  accounting  principles  consistently  applied throughout the
periods covered thereby.

2.7 Liabilities.  As of December 31, 2002 (the "Balance Sheet Date"), Seller had
no debts,  liabilities  or  obligations,  contingent  or  absolute,  inchoate or
otherwise,  other than those debts,  liabilities  and  obligations  reflected or
reserved  against  in  Seller's  balance  sheet at the  Balance  Sheet Date (the
"Balance  Sheet"),  and,  to  Seller's  knowledge,  there  was no basis  for the
assertion  against  Seller of any  liability or  obligation  not so reflected or
reserved against therein.

2.8 Actions Since the Balance Sheet Date.  Since the Balance Sheet Date,  except
as set forth in Schedule 2.8 attached  hereto,  Seller has not: (i) incurred any
material obligation or liability, absolute or contingent, inchoate or otherwise;
(ii) made any wage or salary  increases,  granted any  bonuses or  modified  any
compensation arrangement;  (iii) mortgaged, pledged or subjected to any Lien any
of the Assets,  or permitted any of the Assets to be subjected to any Lien; (iv)
sold,  assigned or  transferred  any of the Assets,  except in the  ordinary and
usual course of business  consistent with past practice;  or (v) other than this
Agreement  and  the   transactions   contemplated   hereby,   entered  into  any
transaction,  agreement  or  course of  conduct,  took any  action,  or made any
commitment not in the ordinary and usual course of business and consistent  with
past practice.

2.9  Adverse  Developments.  Since the Balance  Sheet  Date,  there have been no
material adverse changes in the Assets or Business of Seller,  there has been no
act or omission  on the part of Seller or others  which would form the basis for
the assertion against Seller of any material  liability or obligation,  no other
event has  occurred  which could be  reasonably  expected  to have a  materially
adverse  effect  upon the Assets or  Business,  and Seller  does not know of any
development  or  threatened  development  of a nature which could be  reasonably
expected to have a materially adverse effect upon the Assets or Business.

2.10 Taxes. All taxes, including,  without limitation,  income, property, sales,
use,  utility,  franchise,   capital  stock,  excise,  value  added,  employees'
withholding,  social  security  and  unemployment  taxes  imposed  by the United
States,  any state,  locality or any  foreign  country,  or by any other  taxing
authority,  which have or may become due or payable by Seller,  and all interest
and  penalties  thereon,  whether  disputed  or not,  have  been paid in full or
adequately provided for by




                                       11
<PAGE>
reserves shown in its books of account;  all deposits required by law to be made
by  Seller  or with  respect  to  estimated  income,  franchise  and  employees'
withholding taxes have been duly made; and all tax returns,  including estimated
tax returns,  required to be filed have been duly and timely filed.  No sales or
use taxes are required to be collected in  connection  with the operation of the
Business.

2.11  Intellectual  Property.  Schedule 2.11 sets forth a true and complete list
and brief  description  of each item of  Intellectual  Property owned or used by
Seller in  connection  with the  Business.  Seller  owns or has the right to use
pursuant to law, license, sublicense,  agreement, or permission all Intellectual
Property,  including  any  trademark,  trade  name,  domain  name and web  site,
necessary  for the  operation  of the  Business as  presently  conducted  and as
proposed to be conducted.  Each item of  Intellectual  Property owned or used by
Seller immediately prior to the Closing hereunder will be owned or available for
use by Purchaser on identical terms and conditions immediately subsequent to the
Closing.  Seller has not interfered with,  infringed upon,  misappropriated,  or
otherwise  come into conflict  with any  Intellectual  Property  rights of third
parties, and Seller has never received any charge, complaint,  claim, demand, or
notice  alleging  any  such  interference,  infringement,  misappropriation,  or
violation,  including  any claim that Seller must  license or refrain from using
any Intellectual Property rights of any third party. To the knowledge of Seller,
no  third  party  has  interfered  with,  infringed  upon,  misappropriated,  or
otherwise come into conflict with any  Intellectual  Property  rights of Seller.
Seller has taken all  necessary  action to  maintain  and  protect  each item of
Intellectual  Property  that it owns or uses.  Except as set  forth on  Schedule
2.11,  Seller  (a)  has  not  licensed  or  granted  to  any  person  or  entity
(collectively,  "Person") rights of any nature to use any Intellectual  Property
and (b) does not pay, and is not  obligated to pay,  royalties to any Person for
use of any Intellectual Property.

2.12  Litigation;  Claims;  Compliance  with Law.  (a)  Except as  described  in
Schedule 2.12(a) attached hereto,  there are no actions,  suits,  proceedings or
governmental investigations (collectively,  "Actions") relating to Seller or any
of the Assets or Business pending or, to the knowledge of Seller, threatened, or
any  order,  injunction,  judgment,  award or  decree  (collectively,  "Decree")
outstanding,  against  Seller or  against  or  relating  to any of the Assets or
Business; and, to Seller's knowledge,  there exists no basis for any such Action
or Decree which would have a material adverse effect on the Assets or Business.

          (b)  Schedule  2.12(b)  attached  hereto sets forth for Seller for the
current year and each of the  preceding  three (3) years a statement  describing
each claim made by a third party against  Seller or with respect to the Business
or the Assets,  whether or not such claim was  submitted  to Seller's  insurance
carrier,  including  (i)  the  name  of the  claimant;  (ii)  the  amount  and a
description of the claim and (iii) the resolution of the claim.

          (c)  Seller is not in  violation  of any law,  regulation,  ordinance,
Decree, or other requirement of any governmental or other regulatory body, court
or arbitrator  relating to the Assets or Business,  the violation of which would
have a material adverse effect on the Assets or Business.

2.13 Real Property. Schedule 2.13 attached hereto sets forth a brief description
of all real properties which are owned by, or leased to, Seller and the terms of
the respective leases, including



                                       12
<PAGE>

the identity of the lessor,  the rental rate and other charges,  and the term of
the lease.  The real property  leases  described in Schedule 2.13 that relate to
the leased  properties  described  therein  are in full force and effect and all
amounts  payable  thereunder have been paid. All uses of such real properties by
Seller  conform in all  material  respects  to the terms of the leases  relating
thereto and conform in all  material  respects to all  applicable  building  and
zoning ordinances, laws and regulations.  None of such leases may be expected to
result in the  expenditure of material sums for the  restoration of the premises
upon the expiration of their respective terms.

2.14  Agreements  and  Obligations;  Performance.  Except as listed and  briefly
described in Schedule 2.14 attached hereto (the "Listed Agreements"),  Seller is
not party to, or bound by, any:  (i) written or oral  Contract,  which  involves
aggregate  payments or receipts in excess of $5,000 that cannot be terminated at
will without penalty or premium or any continuing obligation or liability;  (ii)
Contract of any kind with any officer,  director or stockholder;  (iii) Contract
which is violation of applicable  law;  (iv) Contract for the purchase,  sale or
lease  of  any  equipment,  materials,  products,  supplies  or  services  which
contains,  or which commits or will commit it for, a fixed term; (v) Contract of
employment  with any officer or employee not terminable at will without  penalty
or  premium  or  any   continuing   obligation  or   liability;   (vi)  deferred
compensation,  bonus or  incentive  plan or  Contract  not  cancellable  at will
without  penalty or premium or any  continuing  obligation or  liability;  (vii)
management or  consulting  Contract not  terminable  at will without  penalty or
premium or any  continuing  obligation or liability;  (viii)  license or royalty
Contract;  (ix) Contract  relating to indebtedness for borrowed money; (x) union
or other  collective  bargaining  Contract;  (xi) Contract  which, by its terms,
requires  the  consent  of  any  party  thereto  to  the   consummation  of  the
transactions  contemplated  hereby; (xii) Contract containing covenants limiting
the  freedom of Seller to engage or compete in any line or  business or with any
Person in any  geographical  area;  (xiii)  Contract that contains a restrictive
covenant  on the part of Seller or another  party  thereto;  (xiv)  Contract  or
option relating to the acquisition or sale of any business;  (xv) option for the
purchase of any asset,  tangible or  intangible;  or (xvi) other  Contract which
materially  affects  any  of  the  Assets  or  Business,   whether  directly  or
indirectly,  or which was  entered  into  other than in the  ordinary  and usual
course of business  consistent  with past  practice.  A true and correct copy of
each of the written  Listed  Agreements  has been  delivered to Purchaser or its
counsel.  Seller has in all material respects performed all obligations required
to be  performed  by it to date  under all of the Listed  Agreements,  is not in
default  in any  material  respect  under any of the Listed  Agreements  and has
received no notice of any dispute,  default or alleged default  thereunder which
has not heretofore been cured or which notice has not heretofore been withdrawn.
Seller does not know of any material default under any of the Listed  Agreements
by any other party  thereto or by any other Person bound  thereunder.  Except as
set forth on Schedule 2.14  attached  hereto,  each of the Listed  Agreements is
freely assignable to Purchaser.

2.15 Ownership and Condition of Assets.  (a) Seller owns outright,  and has good
and marketable  title to, all of the Assets  (including all assets  reflected in
the  Balance  Sheet),  free and clear of all Liens.  The Assets  constitute  all
assets necessary to permit Seller to conduct the Business as now conducted. None
of the Assets to be transferred  hereunder are subject to any  restriction  with
regard to transferability. There are no Contracts with any Person to acquire any
of the Assets or any rights or interest therein.

                                       13
<PAGE>


          (b) All  machinery,  equipment  and other  Personal  Property  used by
Seller in the conduct of the Business are in good operating condition,  ordinary
wear and tear excepted.

2.16 Permits and Licenses.  Schedule 2.16 attached  hereto sets forth a true and
complete  list of all  Permits  from all Bodies  held by Seller.  Seller has all
Permits of all Bodies  required to carry on the Business as presently  conducted
and to offer and sell its  services and  products;  all such Permits are in full
force and effect, and, to the knowledge of Seller, no suspension or cancellation
of any of such  Permits  is  threatened;  and  Seller  is in  compliance  in all
material respects with all requirements,  standards and procedures of the Bodies
which have issued such Permits.

2.17  Occupational  Heath and Safety and Environmental  Matters.  Seller has all
Permits  from  all  Bodies  relating  to  occupational   health  and  safety  or
environmental matters to lawfully conduct the Business.  There is no litigation,
investigation  or other  proceeding  pending  or, to the  knowledge  of  Seller,
threatened or known to be  contemplated by any Body in respect of or relating to
the  Business or the Assets with  respect to  occupational  health and safety or
environmental  matters.  All  operations of the Business have been  conducted in
compliance  with all, and Seller is not liable in any respect for any  violation
of any,  applicable  federal,  state or local laws or regulations  pertaining to
occupational health and safety and/or environmental matters, including,  without
limitation,  those  relating to the  emission,  discharge,  storage,  release or
disposal of pollutants,  contaminants,  hazardous, noxious or toxic materials or
wastes  ("Materials of Environmental  Concern") into ambient air, surface water,
ground water or land surface or sub-surface  strata or otherwise relating to the
manufacture,  processing,  distribution, use, handling, disposal or transport of
Materials  of  Environmental  Concern.  Seller has not  received any notice of a
possible  claim or citation  against or in respect of any real property owned or
leased by Seller, the Assets or the Business relating to occupational health and
safety or  environmental  matters  and  Seller is not aware of any basis for any
such claim or action.

2.18  Interest  in Assets.  No Person  other than  Seller  owns any  property or
rights, tangible or intangible,  used in or related,  directly or indirectly, to
the Business.

2.19 Compensation Information. Schedule 2.19 attached hereto contains a true and
complete list of the names and current  salary rates of, bonus  commitments  to,
and other compensatory arrangements with, all present officers and employees of,
and independent contractors to, Seller.

2.20 Employee Benefit Plans.

          (a) Schedules 2.20 (a), (b) and (c) attached  hereto include a list of
all of the "pension" and "welfare" benefit plans (within the respective meanings
of Sections  3(2) and 3(1) of the  Employee  Retirement  Income  Security Act of
1974, as amended ["ERISA"]),  maintained by Seller or to which it makes employer
contributions with respect to its employees (collectively, the "Employee Benefit
Plans"),  a complete  and correct  copy of each of which has been  delivered  to
Purchaser.


          (b) All of the pension and profit  sharing plans  maintained by Seller
(herein collectively  referred to as the "Pension Plans") are listed in Schedule
2.20(a).


                                       14
<PAGE>



          (c) All of the pension plans not  maintained by Seller but to which it
makes employer  contributions with respect to its employees (herein collectively
referred to as the "Other Pension Plans"), are listed in Schedule 2.20(b).  Each
of the Other  Pension  Plans is a  "multiemployer  plan"  (within the meaning of
section 3(37) of ERISA), but Seller is not a "substantial  employer" (within the
meaning of section 4001(a)(2) of ERISA) with respect to any of the Other Pension
Plans.

          (d) All of the welfare plans maintained by Seller or to which it makes
employer  contributions  with  respect  to its  employees  (herein  collectively
referred to as the "Welfare Plans") are listed in Schedule 2.20(c).

          (e) There are no  Actions  pending  or, to the  knowledge  of  Seller,
threatened,  and Seller has no  knowledge  of any facts which could give rise to
any actions,  suits or claims against any of the Pension Plans, or (with respect
to the  participation  of Seller  therein)  against any of the Other  Pension or
Welfare Plans, or against Seller with respect to any thereof.

          (f) Seller has  performed  in all material  respects  all  obligations
required to be performed  under each Employee  Benefit  Plan,  and each Employee
Benefit Plan has been  established  and  maintained in all material  respects in
accordance with its terms and in compliance with all applicable laws.

          (g)  There  are no  vested  and  unfunded  benefits  under  any of the
Employee Benefit Plans.

2.21 No Breach.  Neither the execution and delivery of this  Agreement by Seller
nor compliance by Seller with any of the provisions  hereof nor the consummation
of the transactions contemplated hereby, will:

          (a)  violate  or  conflict  with  any  provision  of the  Articles  of
Incorporation or By-laws of Seller;

          (b) violate or, alone or with notice or the passage of time, result in
the breach or termination of, or otherwise give any contracting  party the right
to  terminate,  or declare a default  under,  the terms of any Contract to which
Seller is a party or by which it or any of the Assets may be bound;

          (c) result in the creation of any Lien upon any of the Assets;

          (d) violate any Decree  against,  or binding upon,  Seller or upon the
Assets; or

          (e)  violate any law or  regulation  of any  jurisdiction  relating to
Seller, the Assets or the Business.

2.22 Brokers.  Seller has not engaged,  consented to, or authorized  any broker,
finder, investment banker or other third party to act on its behalf, directly or
indirectly,   as  a  broker  or  finder  in


                                       15
<PAGE>

connection with the transactions contemplated by this Agreement.

2.23 Employment Relations.  (a) Seller is in compliance with all Federal,  state
and other  applicable  laws,  rules and  regulations  respecting  employment and
employment  practices,  terms and  conditions of employment and wages and hours,
and has not engaged in any unfair labor practice  which, in any of the foregoing
cases,  could have a materially  adverse  effect on the Assets or Business;  (b)
there is not pending,  or, to the  knowledge of Seller,  threatened,  any unfair
labor  practice  charge or  complaint  against  Seller by or before the National
Labor Relations Board or any comparable state agency or authority;  (c) there is
no labor strike,  dispute,  slowdown or stoppage pending or, to the knowledge of
Seller,  threatened  against or involving Seller; (d) no union represents any of
Seller's  employees  and  Seller is not aware of any union  organization  effort
respecting the employees of Seller; (e) no grievance which might have an adverse
effect on Seller or the conduct of the Business,  nor any arbitration proceeding
arising out of or under any collective bargaining  agreement,  is pending and no
claim therefor has been asserted; (f) no litigation, arbitration, administrative
proceeding or governmental  investigation is now pending,  and, to the knowledge
of  Seller,  no  Person  has  made  any  claim  or  has  threatened  litigation,
arbitration,  administrative  proceeding or governmental  investigation  against
Seller  arising out of any law  relating to  discrimination  against  employees,
sexual  harassment  or  employment  practices;   (g)  no  collective  bargaining
agreement is currently in effect or being  negotiated by Seller;  and (h) Seller
has not  experienced any material labor  difficulties  during the last three (3)
years.

2.24 Prior Names and Addresses. Since inception, except as set forth in Schedule
2.24 attached  hereto,  Seller has used no business name and has had no business
address  other  than its  current  name and the  business  address  set forth in
Section 13.6.

2.25 Untrue or Omitted Facts. No representation, warranty or statement by Seller
in this Agreement  contains any untrue statement of a material fact, or omits to
state a fact  necessary  in order to make such  representations,  warranties  or
statements not  materially  misleading.  Without  limiting the generality of the
foregoing,  there is no fact  known to  Seller  that  has had,  or which  may be
reasonably  expected to have, a materially  adverse effect on Seller, any of the
Assets or the Business that has not been disclosed in this Agreement.

                                   ARTICLE III

             REPRESENTATIONS AND WARRANTIES OF PURCHASER AND PARENT

     Purchaser   and  Parent,   jointly  and   severally,   make  the  following
representations  and  warranties  to  Seller  as of the  Execution  Date and the
Effective  Date,  each of  which  shall  be  deemed  material,  and  Seller,  in
executing,  delivering  and  consummating  this  Agreement,  has relied upon the
correctness and completeness of each of such representations and warranties:

3.1 Valid Existence. Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the Commonwealth of Pennsylvania.  Parent
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware.


                                       16
<PAGE>


3.2  Capitalization.   The  authorized  capital  stock  of  Parent  consists  of
40,000,000  shares of Common Stock,  $.01 par value, of which 12,353,402  shares
are issued and outstanding,  and 1,000,000  shares of Preferred Stock,  $.01 par
value,  none of  which  are  issued  and  outstanding.  All of such  issued  and
outstanding  shares of Common Stock are duly authorized,  validly issued,  fully
paid and nonassessable.  The Series A Preferred Stock to be issued and delivered
to  Seller  as  contemplated  by  Article  I  hereof  will be duly  and  validly
authorized  and, when so issued and delivered,  will be duly and validly issued,
fully  paid  and  nonassessable.  The  shares  of  Common  Stock  issuable  upon
conversion of the Series A Preferred Stock (the "Conversion Stock") will be duly
and validly  authorized and, when so issued and delivered in accordance with the
terms of the Series A Preferred  Stock,  will be duly and validly issued,  fully
paid and nonassessable.

3.3 Consents. No consents of governmental and other regulatory agencies, foreign
or domestic,  or of third  parties are required to be received by or on the part
of either  Purchaser  or  Parent  to enable it to enter  into and carry out this
Agreement and the transactions contemplated hereby.

3.4 Authority; Binding Nature of Agreement. Each of Purchaser and Parent has the
power  and  authority  to  enter  into  this  Agreement  and to  carry  out  its
obligations  hereunder.  The  execution  and delivery of this  Agreement and the
consummation of the transactions  contemplated  hereby have been duly authorized
by the  Board  of  Directors  of each  of  Purchaser  and  Parent  and no  other
proceedings  on the part of Purchaser or Parent are  necessary to authorize  the
execution  and  delivery  of  this  Agreement  and  the   consummation   of  the
transactions  contemplated  hereby.  This  Agreement  constitutes  the valid and
binding  obligation  of each of  Purchaser  and  Parent  and is  enforceable  in
accordance with its terms.

3.5  SEC Reports.  Parent has previously delivered to Seller a true and complete
copy,  including  exhibits,  of its Annual  Report on Form 10-KSB for the fiscal
year ended  December  31, 2002,  Quarterly  Report on Form 10-QSB for the fiscal
period  ended March 31, 2003,  and Current  Reports on Form 8-K for events dated
January 29,  2003,  March 14, 2003 and April 29,  2003  (collectively,  the "SEC
Reports").  The SEC Reports do not contain  any untrue  statement  of a material
fact,  or fail to state any  material  fact  required  to be stated  therein  or
necessary to make the statements made therein not materially misleading.

3.6  No Breach.  Neither  the  execution  and  delivery  of this  Agreement  nor
compliance  by  Purchaser  or Parent with any of the  provisions  hereof nor the
consummation of the transactions contemplated hereby, will:

     (a)  violate  or  conflict  with  any  provision  of  the   Certificate  of
Incorporation or By-laws of Purchaser or Parent;

     (b) violate any Decree against, or binding upon, Purchaser or Parent; or

     (c) subject to the accuracy of Seller's  representations  and warranties in
Article IV hereof, violate any law or regulation of any jurisdiction relating to
Purchaser or Parent.



                                       17
<PAGE>


3.7  Brokers.  Neither  Purchaser  nor  Parent  has  engaged,  consented  to, or
authorized any broker, finder,  investment banker or other third party to act on
its behalf, directly or indirectly, as a broker or finder in connection with the
transactions contemplated by this Agreement.

                                   ARTICLE IV

                              ACQUISITION OF STOCK

4.1  Investment Intent; Qualification.

     (a) Seller  represents and warrants that the Series A Preferred Stock to be
acquired  pursuant to the terms  hereof is being  acquired,  and any  Conversion
Stock  issued  pursuant  to the terms of the  Series A  Preferred  Stock will be
acquired,  for its own account,  for investment  purposes and not with a view to
the distribution thereof. Seller agrees that it will not sell, assign, transfer,
encumber, pledge, hypothecate, or otherwise dispose of (collectively,  "Disposed
of" or a "Disposition")  any of the Series A Preferred Stock or Conversion Stock
unless (i) a registration statement under the Securities Act of 1933, as amended
(the  "Securities  Act"),  with respect  thereto is in effect and the prospectus
included  therein meets the requirements of Section 10 of the Securities Act, or
(ii)  Parent  has  received  a written  opinion of its  counsel  that,  after an
investigation  of the relevant  facts,  such counsel is of the opinion that such
Disposition does not require registration under the Securities Act.

     (b) Seller  understands  that neither the Series A Preferred  Stock nor the
Conversion  Stock is being  registered  under the Securities Act and such shares
must be held indefinitely unless they are subsequently  registered thereunder or
an exemption from such registration is available.

     (c) Seller represents and warrants that it has reviewed the SEC Reports and
has been afforded the opportunity to obtain such other information to verify the
accuracy of the representations and warranties of Purchaser and Parent contained
in this  Agreement  and to evaluate the merits and risks of an investment in the
Series A Preferred Stock. Seller acknowledges that no oral  representations have
been made or oral information  furnished to Seller or its advisers in connection
with  the  investment  in the  Series  A  Preferred  Stock  that  are in any way
inconsistent  with the  representations  and  warranties of Purchaser and Parent
contained herein.

     (d)  Seller  represents  and  warrants  further  that (i) it is  either  an
"accredited investor," as such term is defined in Rule 501(a) promulgated by the
Securities and Exchange Commission under the Securities Act, or that it has such
knowledge and experience in financial and business matters that it is capable of
evaluating the merits and risks of the acquisition of Series A Preferred  Stock,
(ii) it is able to bear  the  economic  risk of an  investment  in the  Series A
Preferred Stock, including,  without limitation, the risk of the loss of part or
all of its  investment  and the  inability  to sell or  transfer  the  Series  A
Preferred Stock and Conversion Stock, for an indefinite period of time; (iii) it
has adequate means of providing for current needs and  contingencies  and has no
need for liquidity in its investment in the Series A Preferred  Stock,  and (iv)
it does not have an overall  commitment  to  investments  which are not  readily
marketable that is excessive in proportion to its net worth and an investment in
the Series A Preferred  Stock will not cause such overall  commitment  to become


                                       18
<PAGE>


excessive.  Seller will  execute and deliver to Parent such  documents as Parent
may reasonably request in order to confirm the accuracy of the foregoing.

     (e) The  Board of  Directors  of Seller  has not  adopted  any  resolutions
relative  to the  distribution  of  any  of the  Series  A  Preferred  Stock  or
Conversion Stock to its  securityholders  and has no present intention to do so.
Seller acknowledges the restrictions on transfer of the Series A Preferred Stock
and Conversion Stock set forth in Section 10.2 hereof.

4.2  Restrictive Legend. Neither the Series A Preferred Stock nor the Conversion
Stock may be Disposed of unless it is  registered  under the  Securities  Act or
unless an  exemption  from such  registration  is  available.  Accordingly,  the
following  restrictive  legend will be placed on any instrument,  certificate or
other document evidencing the Series A Preferred Stock and Conversion Stock.

     "The shares  represented by this certificate have not been registered under
     the Securities Act of 1933, as amended. These shares have been acquired for
     investment  and not for  distribution  or  resale.  They  may not be  sold,
     assigned,  encumbered,  pledged,  hypothecated or otherwise  transferred or
     disposed of without an  effective  registration  statement  for such shares
     under the Securities Act of 1933, as amended,  or an opinion of counsel for
     the Company that  registration  is not required  under such Act. The shares
     represented  by  this  certificate  are  held  subject  to  the  terms  and
     conditions of a certain Asset Purchase Agreement,  executed on May 28, 2003
     but  effective  as of the close of  business on April 30,  2003,  among the
     Company,  AIA-DCAP  Corp.  and AIA  Acquisition  Corp.,  a copy of which is
     available at the offices of the Company."

4.3  Certain Risk Factors.  Seller acknowledges that there are significant risks
relating to the acquisition of the Series A Preferred Stock, including,  without
limitation, those risks described in the SEC Reports.

                                    ARTICLE V

                              PRE-CLOSING COVENANTS

5.1  Covenants of Seller.  Seller hereby  covenants that from and after the date
hereof and until the Closing or earlier termination of this Agreement:

     (a)  Access;  Due  Diligence  Investigation.  Seller  shall  afford  to the
officers,  attorneys,   accountants  and  other  authorized  representatives  of
Purchaser (collectively, "Representatives") free and full access, during regular
business  hours  and  upon  reasonable  notice,  to all of its  books,  records,
personnel and properties so that  Purchaser,  at its own expense,  may have full
opportunity to make such review,  examination and investigation as Purchaser may
desire of Seller and its business and affairs.  Seller will cause its employees,
accountants,  attorneys and other agents and  representatives to cooperate fully
with said review,  examination and  investigation and to make full disclosure to
Purchaser of all material  facts  affecting  Seller's  financial  condition  and
business operations.


                                       19
<PAGE>


     (b) Conduct of  Business.  Seller shall  conduct its  business  only in the
ordinary and usual  course and make no change in any of its  business  practices
and policies  without the prior written consent of Purchaser.  Without  limiting
the generality of the foregoing,  prior to the Closing, Seller will not, without
the prior written consent of Purchaser:

          (i)  amend its Articles of Incorporation or By-Laws;

          (ii) enter   into,   adopt  or  amend  any  bonus,   profit   sharing,
               compensation,   pension,   retirement,   deferred   compensation,
               employment, severance or other employee benefit agreement, trust,
               plan, fund or other arrangement for the benefit or welfare of any
               employee,  or increase in any manner the  compensation  or fringe
               benefits of any  employee or pay any benefit not  required by any
               plan and  arrangement as in effect as of the date hereof or enter
               into any Contract to do any of the foregoing;

          (iii)sell,  lease  or  dispose  of any  assets  (other  than  Excluded
               Assets) outside the ordinary  course of business  consistent with
               past  practice or any assets which in the  aggregate are material
               to Seller;

          (iv) mortgage,  pledge  or  subject  to any Lien any of the  Assets or
               permit any of the Assets to be subjected to any Lien;

          (v)  acquire (by merger, consolidation, acquisition of stock or assets
               or otherwise) any  corporation,  partnership,  limited  liability
               company or other business organization or division thereof;

          (vi) enter  into or amend  any  Contract  other  than in the  ordinary
               course of business consistent with past practice; or

          (vii)enter  into or amend  any  Contract  with  respect  to any of the
               foregoing.

          (c)  Liabilities.  Seller shall not incur any obligation or liability,
absolute or contingent,  inchoate or otherwise, except for those incurred in the
ordinary and usual course of its business consistent with past practice, without
the prior written consent of Purchaser.

          (d)  Preservation  of  Business.  Seller will use its best  efforts to
preserve its business  organization  intact,  keep available the services of its
present employees and consultants and preserve its goodwill.

          (e)  No Breach.

               (i)  Seller  will  (A) use  commercially  reasonable  efforts  to
                    assure  that  all  of  its  representations  and  warranties
                    contained  herein are true as of the  Closing as if repeated
                    at and as of such time,  that no material  breach or default
                    shall


                                       20
<PAGE>



                    occur with respect to any of its covenants,  representations
                    or  warranties  contained  herein that has not been cured by
                    the Closing and that all  conditions  to the  obligation  of
                    Purchaser  and Parent to enter into and complete the Closing
                    are satisfied in a timely manner;  (B) not voluntarily  take
                    any  action or do  anything  which will cause a breach of or
                    default   respecting  such  covenants,   representations  or
                    warranties  or  would  impede  the   satisfaction   of  such
                    conditions;  and (C) promptly notify Purchaser and Parent of
                    any  event or fact  which  represents  or is likely to cause
                    such a breach or default or result in such an impediment.

               (ii) Without  limiting the  generality of the  foregoing,  Seller
                    agrees to use  commercially  reasonable  efforts to take, or
                    cause to be taken,  all  actions,  and to do, or cause to be
                    done, all things reasonably  necessary,  proper or advisable
                    under applicable laws and regulations to consummate and make
                    effective the transactions contemplated by this Agreement.

     (f) Consents.  Promptly  following the execution of this Agreement,  Seller
will use commercially reasonable efforts to obtain consents of any and all third
parties and  governmental  authorities  necessary  for the  consummation  of the
transactions contemplated by this Agreement.

     (g) No Negotiations.  For so long as this Agreement shall remain in effect,
Seller shall not, directly or indirectly,  (i) solicit or initiate  discussions,
engage in  negotiations,  or  continue  any  discussions  or  negotiations  that
heretofore have taken place, with any Person ("Potential Offeror") (whether such
negotiations  are initiated by them or otherwise),  other than  Purchaser,  with
respect to the possible  acquisition  or  refinancing of any interest in or with
regard to Seller or the Assets, whether by way of merger, acquisition of assets,
acquisition  of  stock or other  equity  interest  or  otherwise  (a  "Potential
Transaction"), (ii) provide any information with respect to Seller, the Business
or the  Assets  to any  Person,  other  than  Purchaser,  in  connection  with a
Potential  Transaction,  or (iii) enter into any Contract with any Person, other
than  Purchaser,   concerning  or  relating  to  a  Potential  Transaction.  If,
subsequent  to the  date  hereof,  Seller  or any  of its  officers,  directors,
employees,  or agents receives any  unsolicited  offer or proposal to enter into
negotiations relating to a Potential Transaction,  they shall immediately notify
Purchaser of such fact and shall return any such written offer to such Potential
Offeror.

5.2  Covenants of Purchaser  and Parent.  Each of  Purchaser  and Parent  hereby
covenants  that from and after the date  hereof and until the Closing or earlier
termination of this Agreement:

     (a)  No Breach.

          (i)  Each of Purchaser and Parent will (A) use commercially reasonable
               efforts to assure that all of its  representations and warranties
               contained herein are true as of the Closing as if repeated at and
               as of such time,  that no material  breach or default shall occur
               with  respect  to  any  of  its  covenants,   representations  or
               warranties  contained  herein  that  has not  been  cured  by the
               Closing and that


                                       21
<PAGE>

               all  conditions  to the  obligation  of Seller to enter  into and
               complete the Closing are  satisfied in a timely  manner;  (B) not
               voluntarily  take any  action or do  anything  which will cause a
               breach of or default  respecting such covenants,  representations
               or   warranties  or  would  impede  the   satisfaction   of  such
               conditions;  and (C) promptly  notify Seller of any event or fact
               which  represents  or is likely to cause such a breach or default
               or result in such an impediment.

          (ii) Without  limiting  the  generality  of  the  foregoing,  each  of
               Purchaser  and  Parent  agrees  to  use  commercially  reasonable
               efforts to take, or cause to be taken, all actions, and to do, or
               cause to be done,  all  things  reasonably  necessary,  proper or
               advisable under applicable laws and regulations to consummate and
               make effective the transactions contemplated by this Agreement.

                                   ARTICLE VI

                           CONDITIONS PRECEDENT TO THE
                   OBLIGATION OF PURCHASER AND PARENT TO CLOSE

     The  obligation  of Purchaser  and Parent to  consummate  the  transactions
contemplated  hereby is subject to the fulfillment,  prior to or at the Closing,
of each of the following  conditions,  any one or more of which may be waived by
Purchaser  and  Parent  (except  when the  fulfillment  of such  condition  is a
requirement of law):

6.1  Representations  and  Warranties.  All  representations  and  warranties of
Seller  contained  in this  Agreement  and in any  schedule  or  other  document
delivered  pursuant hereto or in connection with the  transactions  contemplated
hereby  shall be true and  complete  as at the Closing  Date,  as if made at the
Closing and as of the Closing Date.

6.2  Covenants.  Seller shall have performed and complied with all covenants and
agreements  required by this  Agreement to be  performed or complied  with by it
prior to or at the Closing.

6.3  Certificate.  Purchaser and Parent shall have received a certificate, dated
the Closing Date,  signed by an officer of Seller as to the  satisfaction of the
conditions contained in Sections 6.1 and 6.2 hereof.

6.4  Assignment and Bill of Sale;  Assignment of Intellectual  Property.  Seller
shall have executed and tendered to Purchaser an assignment and bill of sale, in
form  mutually  satisfactory  to  the  parties  (the  "Bill  of  Sale"),  and an
assignment of Intellectual Property rights, in form mutually satisfactory to the
parties (the "Intellectual Property Assignment"), pursuant to which Seller shall
convey to Purchaser  all of its right,  title and interest in and to the Assets,
free and clear of all Liens.

6.5  Assignment and Assumption Agreement;  Lease Assignments.  Seller shall have
executed and tendered to Purchaser an Assignment  and Assumption  Agreement,  in
form  mutually  satisfactory  to the parties  (the  "Assignment  and  Assumption
Agreement"),  with regard to all executory  Contracts

                                       22
<PAGE>

included in the Assets to which Seller is a party,  and an  Assignment of Lease,
in  form  mutually  satisfactory  to  the  parties  (collectively,   the  "Lease
Assignments"),  with  regard  to each real and  personal  property  lease  being
assigned to Purchaser,  in each case  together with any required  consent of the
other party thereto.

6.6  [intentionally omitted]
      ---------------------

6.7  Lease.  Seller  shall have  executed and tendered to Purchaser a lease with
respect  to the  premises  located  at 5927 North  Broad  Street,  Philadelphia,
Pennsylvania  in, or  substantially  in, the form attached hereto as Exhibit 6.7
(the "Lease").

6.8  Due Diligence Investigation. Purchaser shall have completed a due diligence
investigation of Seller, the Business and the Assets, the results of which shall
be satisfactory to Purchaser in its sole discretion.

6.9  Restrictive Covenant Agreements.  Each of Seller, Barry Goldstein and Barry
Lefkowitz  shall have executed and tendered to Purchaser a restrictive  covenant
agreement  in, or  substantially  in, the form  attached  hereto as Exhibit  6.9
(collectively, the "Restrictive Covenant Agreements").

6.10 Employment  Agreement.  Barry Lefkowitz shall have executed and tendered to
Purchaser an  employment  agreement in, or  substantially  in, the form attached
hereto as Exhibit 6.10 (the "Employment Agreement").

6.11 Termination  Statements.  Purchaser  shall have received UCC-3  Termination
Statements  with regard to all  outstanding  Liens on the Assets,  if any,  duly
executed by the secured parties.

6.12 No Actions. No Action shall have been instituted,  and be continuing before
a court or before or by a governmental or other  regulatory  body or agency,  or
shall have been  threatened and be  unresolved,  to restrain or to prevent or to
obtain any amount of damages in respect of, the carrying out of the transactions
contemplated  hereby,  or which might  affect the right of  Purchaser to own the
Assets or to operate or control the Assets and Business  after the Closing Date,
or which might have an adverse effect thereon.

6.13 Consents;  Licenses and Permits.  Seller shall have  obtained all consents,
licenses and permits of third parties, including, without limitation, regulatory
authorities, necessary for the performance by it of all of its obligations under
this Agreement,  including,  without  limitation,  the transfer of the Assets as
contemplated hereby, and such other consents,  if any, to prevent the occurrence
of a breach under any  Contract of Seller with any Person,  the  termination  of
which would have a material adverse effect on the Business or Assets.  Purchaser
shall have obtained all necessary licenses and permits of regulatory authorities
in the Commonwealth of Pennsylvania to operate the Business.

6.14 Corporate  Actions.  All actions  necessary  to  authorize  the  execution,
delivery and performance of this Agreement by Seller and the consummation of the
transactions  contemplated  hereby shall have been duly and validly  taken,  and
Seller  shall  have  full  power  and  right  to  consummate  the   transactions
contemplated by this Agreement.



                                       23
<PAGE>


6.15 Additional  Documents.  Seller  shall  have  delivered  all such  certified
resolutions,  certificates  and  documents  with respect to the Business and the
Assets as Purchaser or its counsel may have reasonably requested.

6.16 Approval of Counsel.  All actions,  proceedings,  instruments and documents
required  to carry out this  Agreement,  or  incidental  thereto,  and all other
related  legal  matters,  shall have been  approved as to form and  substance by
counsel to  Purchaser,  which  approval  shall not be  unreasonably  withheld or
delayed.

                                   ARTICLE VII

                    CONDITIONS PRECEDENT TO THE OBLIGATION OF
                                 SELLER TO CLOSE

     The obligation of Seller to consummate the transactions contemplated hereby
is  subject  to the  fulfillment,  prior  to or at the  Closing,  of each of the
following  conditions,  any one or more of which may be waived by Seller (except
when the fulfillment of such condition is a requirement of law):

7.1  Representations  and  Warranties.  All  representations  and  warranties of
Purchaser and Parent  contained in this Agreement  shall be true and complete as
at the Closing Date, as if made at the Closing and as of the Closing Date.

7.2  Covenants.  Each of Purchaser and Parent shall have  performed and complied
with all covenants and agreements  required by this Agreement to be performed or
complied with by it prior to or at the Closing.

7.3  Certificate.  Seller shall have received a  certificate,  dated the Closing
Date, signed by an officer of Purchaser and Parent as to the satisfaction of the
conditions contained in Sections 7.1 and 7.2 hereof

7.4  Assignment and Assumption  Agreement;  Lease  Assignments.  Purchaser shall
have executed and tendered to Seller the  Assignment  and  Assumption  Agreement
with regard to the Assumed Obligations.

7.5  Guaranty and Pledge Agreement.  Blast Acquisition Corp. ("Blast"), the sole
shareholder of Purchaser,  shall have executed and tendered to Seller a guaranty
and  pledge  agreement  in, or  substantially  in, the form  attached  hereto as
Exhibit  7.5  (the  "Guaranty  and  Pledge  Agreement"),  pursuant  to  which it
guarantees,  on a  non-recourse  basis,  Parent's  redemption  obligation  under
Section (iii) of the  Certificate of  Designations,  and, as security  therefor,
pledges to Seller all of the outstanding stock of Purchaser.

7.6  Registration  Rights Agreement.  Parent shall have executed and tendered to
Seller a  registration  rights  agreement  in,  or  substantially  in,  the form
attached hereto as Exhibit 7.6 (the


                                       24
<PAGE>

"Registration Rights Agreement").

7.7  No Actions. No Action shall have been instituted, and be continuing, before
a court or by a governmental or other  regulatory  body or agency,  or have been
threatened,  and be unresolved,  to restrain or prevent, or obtain any amount of
damages in respect of, the carrying out of the transactions contemplated hereby.

7.8  Corporate  Actions.  All actions  necessary  to  authorize  the  execution,
delivery and  performance  of this  Agreement  by  Purchaser  and Parent and the
consummation of the  transactions  contemplated  hereby shall have been duly and
validly  taken,  and  Purchaser  and  Parent  shall have full power and right to
consummate the transactions contemplated by this Agreement.

7.9  Additional  Documents.  Purchaser and Parent shall have  delivered all such
certified resolutions,  certificates and documents with respect to Purchaser and
Parent as Seller or counsel to Seller may have reasonably requested.

7.10 Approval of Counsel.  All actions,  proceedings,  instruments and documents
required  to carry  out this  Agreement  or  incidental  thereto,  and all other
related  legal  matters,  shall have been  approved as to form and  substance by
counsel to Seller, which approval shall not be unreasonably withheld or delayed.

                                  ARTICLE VIII

                                     CLOSING

8.1  Location.  The closing (the "Closing") provided for herein shall take place
at the offices of Certilman Balin Adler & Hyman,  LLP, 90 Merrick  Avenue,  East
Meadow, New York 11554 concurrently with the execution hereof. The Closing shall
be deemed to have  occurred  as of the  Effective  Date.  The deemed date of the
Closing is referred to in this Agreement as the "Closing Date."

                                   ARTICLE IX

                               CLOSING DELIVERIES

9.1  Items to be  Delivered by Seller.  At the  Closing,  Seller will deliver or
cause to be delivered to Purchaser:

     (a)  the certificate required by Section 6.3 hereof;

     (b)  the Bill of Sale and the Intellectual  Property Assignment required by
          Section 6.4 hereof;

     (c)  the Assignment and Assumption Agreement and Lease Assignments required
          by



                                       25
<PAGE>

          Section 6.5 hereof;

     (d)  the Lease required by Section 6.7 hereof;

     (e)  the Restrictive Covenant Agreements required by Section 6.9 hereof;

     (f)  the Employment Agreement required by Section 6.10 hereof;

     (g)  the UCC-3 Termination Statements required by Section 6.11 hereof;

     (h)  certified  copies of all actions  necessary to authorize the execution
          of this Agreement by Seller and the  consummation of the  transactions
          contemplated hereby required by Section 6.14 hereof; and

     (i)  the Registration Rights Agreement required by Section 7.6 hereof.

9.2  Items to be Delivered by Purchaser. At the Closing,  Purchaser will deliver
or cause to be delivered to Seller:

     (a)  the Assignment and Assumption Agreement and Lease Assignments required
          by Section 7.4 hereof;

     (b)  the Guaranty and Pledge Agreement required by Section 7.5 hereof;

     (c)  the Registration Rights Agreement required by Section 7.6 hereof; and

     (d)  certified  copies of all actions  necessary to authorize the execution
          of  this   Agreement  by  Purchaser  and  the   consummation   of  the
          transactions contemplated hereby required by Section 7.8 hereof.

                                    ARTICLE X

                              POST-CLOSING MATTERS

10.1 Series A  Preferred  Stock.  Parent  will  issue  and  deliver  to Seller a
certificate representing the Series A Preferred Stock pursuant to the provisions
of Section 1.3.5(a) hereof.  Simultaneously  therewith,  Seller will deliver the
certificate to Purchaser pursuant to the provisions of Section 11.5 hereof.

10.2 Restrictions on Transfers.  Until the expiration of the Survival Period (as
hereinafter defined),  Seller will not make a Disposition of any of the Series A
Preferred Stock or Conversion Stock, including, without limitation,  pursuant to
a distribution  to its  stockholders,  and, in the event that Purchaser  makes a
claim against  Seller  pursuant to the  provisions of Article XI hereof,  Seller
will not make a Disposition of any such shares until such claim is resolved. Any
Disposition in



                                       26
<PAGE>

violation of the foregoing shall be null and void.

10.3 Special  Receivables.  Purchaser  will  transfer  and  assign to Seller the
Allocable  Portion of any  Special  Receivables  pursuant to the  provisions  of
Section 1.3.4 hereof and shall remit to Seller any amounts received by Purchaser
to which Seller is entitled pursuant to such provisions.

10.4 Excluded  Commissions;  Excluded  Store.  Subsequent  to the  Closing,  (a)
Purchaser will remit to Seller any monies  received by it on account of Excluded
Commissions and (b) all customers of the Excluded Store shall be transitioned to
one or more of the other stores heretofore operated by Seller.

10.5 Employee Benefits; WARN. (a) Seller shall be responsible for the payment of
all wages,  other  remuneration and termination or severance  amounts due to its
employees  and for  the  provision  of  health  plan  continuation  coverage  in
accordance with the requirements of COBRA.

     (b) No  portion of the assets of any plan,  fund,  program or  arrangement,
written or unwritten,  heretofore sponsored or maintained by Seller,  including,
without  limitation,  the Employee Benefit Plans (and no amount  attributable to
any such plan, fund, program or arrangement), shall be transferred to Purchaser,
and Purchaser shall not be required to continue any such plan, fund,  program or
arrangement  after the  Closing  Date.  The  amounts  payable  on account of all
benefit arrangements shall be determined with reference to the date of the event
by reason of which such amounts  become  payable,  without  regard to conditions
subsequent,  and  Purchaser  shall  not be liable  for any claim for  insurance,
reimbursement  or other  benefits  payable by reason of any event  which  occurs
prior to the Closing Date.

     (c) Seller shall be responsible for all  obligations and liabilities  under
the Workers Adjustment and Retraining  Notification Act of 1988, as amended, and
each  similar  state law  (collectively,  "WARN"),  with respect to employees by
reason of their severance or other termination of employment by Seller on, prior
to or  following  the Closing  Date or the failure by Purchaser to hire any such
employees on or after the Closing Date.

10.6 Liabilities.  On and after the Closing Date, Seller shall pay and otherwise
satisfy all of its liabilities as and when due.

10.7 Change of  Fictitious  Name  Registration.  Promptly  following the Closing
Date, Seller shall file with the Secretary of State of Pennsylvania an amendment
to its Fictitious  Name  Registration  pursuant to which it assigns to Purchaser
the right to use the names "Atlantic  Insurance  Agency",  "Lowest 1 Agency" and
"Pennstone  Agency".  Subsequent  to the Closing  Date,  neither  Seller nor any
affiliate thereof will use, or permit the use of, directly or indirectly, any of
the names "Atlantic Insurance Agency", "Lowest 12 Agency" and "Pennstone Agency"
or any name deceptively similar thereto.

10.8 Tag and Title  Services.  On and after the Closing Date and until Purchaser
receives all licenses and permits necessary to provide tag and title services in
the Commonwealth of


                                       27
<PAGE>

Pennsylvania  (the  "Tag and Title  Period"),  Seller  shall act as  Purchaser's
agent,  and  shall  remit  to  Purchaser  all  monies  received,  in  connection
therewith.  During the Tag and Title Period,  Seller shall have a license to use
such of the Assets as are necessary to perform its duties hereunder.

10.9 Purchaser  Assets  and  Borrowings.  For so long as any  shares of Series A
Preferred Stock are issued and  outstanding,  without  Seller's written consent,
Purchaser  shall  not  (a)  make a  distribution  of any  of its  assets  to its
shareholder(s)  other than to the extent of operating  profits or (b) borrow any
monies from any third parties other than Blast, Parent or any affiliate thereof.

10.10Further Assurances.  On and after the Closing Date, (a) upon the request of
Purchaser,  Seller shall take all such further actions and execute,  acknowledge
and deliver all such further  instruments  and  documents as may be necessary or
desirable  to convey and  transfer  to, and vest in,  Purchaser,  and to protect
Purchaser's  right,  title and interest in and to, and  enjoyment of, the Assets
intended to be assigned,  transferred,  conveyed and delivered  pursuant to this
Agreement,  and (b) the parties shall take all such further  actions and execute
and deliver all such further  instruments  and  documents as may be necessary or
appropriate to carry out the transactions contemplated by this Agreement.

10.11Power of Attorney.  Without  limitation of any provision of this Agreement,
effective upon the Closing Date, Seller  constitutes and appoints  Purchaser and
its  successors and assigns,  and each of them, the true and lawful  attorney of
Seller,  with full power of  substitution,  in their own names or in the name of
Seller, but for their own benefit and at their own expense, (i) to institute and
prosecute all proceedings which any of them may deem proper in order to collect,
assert or  enforce  any  claim,  right or title of any kind in or to the  Assets
transferred or intended to be transferred to Purchaser hereunder,  and to do all
such acts and things in  relation  thereto as any of them shall deem  advisable,
and (ii) to take all actions  which they may deem proper in order to provide for
them the benefits  under any claims,  Contracts,  licenses,  commitments,  sales
orders,  purchase  orders  or other  documents  or  instruments  transferred  or
intended to be transferred to Purchaser hereunder.  Seller acknowledges that the
foregoing  powers are coupled with an interest and shall not be revocable in any
manner or for any reason.

                                   ARTICLE XI

                  SURVIVAL OF REPRESENTATIONS; INDEMNIFICATION

11.1 Survival.  The representations  and warranties  contained in this Agreement
shall  survive  the  Closing  for a period  of three (3)  years  (the  "Survival
Period"),  with the exception of those set forth in Sections 2.1, 2.3, 2.4, 2.5,
2.21,  3.1,  3.3, 3.4 and 3.6 which shall  survive the Closing for an indefinite
period. Any claim relating to any such representation or warranty shall continue
after the  expiration  of the  Survival  Period until such claim is resolved and
satisfied  if the party  entitled to such  indemnification  has  provided to the
party required to provide such  indemnification  prior to such expiration date a
Claim Notice (as hereinafter defined).


                                       28
<PAGE>

11.2 Indemnification.

     11.2.1  General  Indemnification  Obligation of Seller.  From and after the
date hereof,  Seller will reimburse,  indemnify and hold harmless  Purchaser and
its successors and assigns (an  "Indemnified  Purchaser  Party")  against and in
respect of:

          (a) any and all damages, losses, deficiencies,  liabilities, costs and
expenses  incurred or suffered by any  Indemnified  Purchaser  Party that result
from, relate to or arise out of:

               (i) any and all  liabilities  and  obligations  of  Seller of any
kind,  nature and  description  whatsoever,  fixed or  contingent,  inchoate  or
otherwise, other than the Assumed Obligations;

               (ii) any and all claims against any  Indemnified  Purchaser Party
that relate to the  Business or the Assets in which the  principal  event giving
rise  thereto  occurred  prior to the Closing Date or which result from or arise
out of any  action  or  inaction  prior to the  Closing  Date of  Seller  or any
director, officer, employee, shareholder, agent or representative of Seller;

               (iii) any and all claims against any Indemnified  Purchaser Party
that relate to the  Business or the Assets in which the  principal  event giving
rise thereto  occurred  between the Closing Date and the Execution Date or which
result from or arise out of any action or inaction  between the Closing Date and
the Execution Date of Seller or any director,  officer,  employee,  shareholder,
agent or representative of Seller, other than the Assumed Obligations and claims
which are not material and arise in the oridinary course of the Business between
the Closing Date and the Execution Date;

               (iv) any misrepresentation,  breach of warranty or nonfulfillment
of any agreement or covenant on the part of Seller under this Agreement, or from
any misrepresentation in or omission from any certificate,  schedule, statement,
document or instrument  furnished to Purchaser  pursuant hereto or in connection
with the negotiation, execution or performance of this Agreement; and

          (b)  any  and  all  Actions,  demands,  assessments,   audits,  fines,
judgments, costs and other expenses (including,  without limitation,  reasonable
legal  fees)  incident to any of the  foregoing  or to the  enforcement  of this
Section 11.2.1.

     11.2.2 General Indemnification  Obligation of Purchaser. From and after the
date hereof,  Purchaser will  reimburse,  indemnify and hold harmless Seller and
its  successors  and  assigns (an  "Indemnified  Seller  Party")  against and in
respect of:

          (a) any and all damages, losses, deficiencies,  liabilities, costs and
expenses incurred or suffered by any Indemnified  Seller Party that result from,
relate to or arise out of:


                                       29
<PAGE>


               (i) any and all  liabilities and obligations of Seller which have
     been  specifically  assumed by Purchaser  pursuant to Section 1.4.2 of this
     Agreement;

               (ii) any  misrepresentation  or breach of warranty on the part of
     Purchaser or Parent under this Agreement; and

          (b)  any  and  all  Actions,  demands,  assessments,   audits,  fines,
judgments, costs and other expenses (including,  without limitation,  reasonable
legal  fees)  incident to any of the  foregoing  or to the  enforcement  of this
Section 11.2.2.

     11.2.3 Method of Asserting Claims.

          (a) In the event  that any claim or demand for which  Seller  would be
liable to an Indemnified Purchaser Party hereunder is asserted against or sought
to be  collected  from an  Indemnified  Purchaser  Party by a third  party,  the
Indemnified  Purchaser  Party  shall  notify  Seller  of such  claim or  demand,
specifying  the nature of such  claim or demand and the amount or the  estimated
amount  thereof  to the  extent  then  feasible  (which  estimate  shall  not be
conclusive  of the final amount of such claim and demand) (the "Claim  Notice").
Seller shall  thereupon,  at its sole cost and expense,  defend the  Indemnified
Purchaser   Party   against  such  claim  or  demand  with  counsel   reasonably
satisfactory to Indemnified Purchaser Party.

          (b)  Seller  shall  not,  without  the prior  written  consent  of the
Indemnified  Purchaser  Party,  consent to the entry of any judgment against the
Indemnified  Purchaser  Party or enter into any  settlement or compromise  which
does not  include,  as an  unconditional  term  thereof  (i.e.,  there  being no
requirement that the Indemnified Purchaser Party pay any amount of money or give
any  other  consideration),  the  giving by the  claimant  or  plaintiff  to the
Indemnified Purchaser Party of a release, in form and substance  satisfactory to
the Indemnified  Purchaser Party, from all liability in respect of such claim or
litigation.  If any  Indemnified  Purchaser Party desires to participate in, but
not control,  any such defense or settlement,  it may do so at its sole cost and
expense.  If, in the reasonable opinion of the Indemnified  Purchaser Party, (i)
the use of counsel  chosen by Seller would  present such counsel with a conflict
of interest,  or (ii) the actual or potential  defendants in, or targets of, any
such action include both the  Indemnified  Purchaser  Party and Seller,  and the
Indemnified  Purchaser Party shall have  reasonably  concluded that there may be
legal defenses  available to it which are different from or in addition to those
available  to  Seller,  or (iii)  any  claim or  demand,  or the  litigation  or
resolution of any such claim or demand,  involves an issue or matter which could
reasonably have a materially adverse effect on the business, operations, assets,
properties or prospects of the  Indemnified  Purchaser  Party or its affiliates,
then,  in each case,  the  Indemnified  Purchaser  Party shall have the right to
control the defense or  settlement of any such claim or demand and its costs and
expenses shall be included as part of the  indemnification  obligation of Seller
hereunder;  provided,  however,  that the Indemnified  Purchaser Party shall not
settle any such claim or demand  without  the prior  written  consent of Seller,
which consent shall not be unreasonably  withheld or delayed. If the Indemnified
Purchaser Party should elect to exercise such right, Seller shall have the right
to participate  in, but not control,  the defense or settlement of such claim or
demand at its sole cost and expense.


                                       30
<PAGE>


          (c) In the event an  Indemnified  Purchaser  Party should have a claim
against Seller  hereunder that does not involve a claim or demand being asserted
against or sought to be  collected  from it by a third  party,  the  Indemnified
Purchaser  Party shall send a Claim Notice with respect to such claim to Seller.
If Seller does not notify the Indemnified  Purchaser Party, within ten (10) days
from receipt of the Claim  Notice,  that it disputes  such claim,  the amount of
such claim shall be conclusively deemed a liability of Seller hereunder.

          (d) All claims for  indemnification  by an  Indemnified  Seller  Party
under this  Agreement  shall be asserted and resolved  under the  procedures set
forth hereinabove by substituting in the appropriate place  "Indemnified  Seller
Party" for "Indemnified  Purchaser Party" and variations thereof and "Purchaser"
for "Seller" and variations thereof as applicable.

11.3 Limitations.

          (a)  Notwithstanding  anything  herein to the contrary,  as to matters
which are subject to indemnification pursuant to this Article XI, neither Seller
nor  Purchaser   shall  be  liable  unless  and  until  the  aggregate   claims,
liabilities,  losses, costs and expenses to the indemnified party resulting from
such  otherwise  indemnifiable  matters  shall exceed a cumulative  aggregate of
twenty-five  thousand dollars  ($25,000) (the  "Indemnification  Threshold") and
then shall only be liable for the excess  above the  Indemnification  Threshold.
For purposes of this section only, in determining  whether there was any failure
to disclose,  breach or failure of observance or  performance  or any untruth or
incorrect  statement with regard to any  representation,  warranty,  covenant or
agreement,   the   terms   "material"   and   "materially,"   as  used  in  such
representation, warranty, covenant and agreement, shall be deemed to mean a cost
or liability to the indemnified party in amount equal to or greater than $2,500.

          (b) The total  indemnification  to which  Purchaser  shall be entitled
under this Article XI (exclusive of legal fees and expenses) shall be limited to
an amount not to exceed the Purchase Price.

11.4 Payment;  Right of Setoff.  Upon the  determination  of the liability under
this Article XI, the appropriate  party shall pay to the other,  within ten (10)
days after such determination,  the amount of any claim for indemnification made
hereunder.  Further,  pending  final  determination  of any  claims,  demands or
disputes in accordance  with the  provisions  of this Article XI,  Purchaser and
Parent shall have the right to withhold from and offset  against any amounts due
to Seller,  pursuant to this Agreement or otherwise,  the amount of such claims,
demands and/or disputes;  provided however, that, in the event Purchaser desires
to  exercise  its right of offset,  it shall  place in escrow  with  Purchaser's
counsel,  pursuant to an escrow  agreement  mutually  acceptable  to  Purchaser,
Seller,  and  such  counsel,  any and all  amounts  so  offset  pending  a final
determination by a court of competent jurisdiction with regard thereto.

11.5 Security. As security for Seller's  indemnification  obligations under this
Article  XI,  concurrently  with  the  delivery  to  Seller  of the  certificate
representing  the Series A Preferred  Stock


                                       31
<PAGE>

pursuant to Section  1.3.5  hereof,  Seller shall  deliver such  certificate  to
Purchaser  pursuant  to a pledge  agreement  in, or  substantially  in, the form
attached hereto as Exhibit 11.5 (the "Pledge Agreement"),  together with a stock
power duly executed in blank.

11.6 Other Rights and Remedies Not Affected.  The indemnification  rights of the
parties under this Article XI are  independent of and in addition to such rights
and  remedies as the parties may have at law or in equity or  otherwise  for any
misrepresentation,  breach of warranty or failure to fulfill  any  agreement  or
covenant  hereunder  on  the  part  of  any  party  hereto,  including,  without
limitation,  the right to seek specific performance,  rescission or restitution,
none of which rights or remedies shall be affected or diminished hereby.

                                   ARTICLE XII

                             TERMINATION AND WAIVER

12.1 Termination.  Anything herein or elsewhere to the contrary notwithstanding,
this  Agreement  may be  terminated  and the  transactions  provided  for herein
abandoned at any time prior to the Closing:

          (a) By mutual consent of Purchaser and Seller;

          (b) By  Purchaser,  if any of the  conditions  set forth in Article VI
hereof shall not have been  fulfilled on or prior to the Closing  Date, or shall
become incapable of fulfillment, in each case except as such shall have been the
result, directly or indirectly, of any action or inaction by Purchaser and shall
not have been waived; or

          (c) By  Seller,  if any of the  conditions  set forth in  Article  VII
hereof shall not have been  fulfilled on or prior to the Closing  Date, or shall
have become  incapable  of  fulfillment,  in each case except as such shall have
been the result, directly or indirectly, of any action or inaction by Seller and
shall not have been waived.

          If this  Agreement is terminated as described  above,  this  Agreement
shall be of no further force and effect,  without any liability or obligation on
the part of any of the  parties  except for any  liability  which may arise as a
result  of a  party's  breach  of  any  representation,  warranty,  covenant  or
agreement  in this  Agreement  or its  failure to  consummate  the  transactions
contemplated hereby notwithstanding the satisfaction of its conditions to close.

12.2 Waiver.  Any condition to the  performance of the parties which legally may
be waived on or prior to the Closing Date may be waived at any time by the party
entitled  to the benefit  thereof by an  instrument  in writing  executed by the
relevant  party or  parties.  The  failure  of any party at any time or times to
require  performance of any provision hereof shall in no manner affect the right
of such party at a later time to enforce the same. No waiver by any party of the
breach of any term,  covenant,  representation  or  warranty  contained  in this
Agreement as a condition to such party's obligations  hereunder shall release or
affect any liability  resulting  from such breach,  and no waiver of any nature,


                                       33
<PAGE>

whether by conduct or otherwise,  in any one or more instances,  shall be deemed
to be or construed as a further or continuing waiver of any such condition or of
any breach of any other  term,  covenant,  representation  or  warranty  of this
Agreement.

                                  ARTICLE XIII

                            MISCELLANEOUS PROVISIONS

13.1 Expenses.  Each of the parties  shall bear its own  expenses in  connection
herewith.

13.2 Publicity.  The parties  agree that no  publicity,  release or other public
announcement   (collectively,   "Announcement")   concerning  the   transactions
contemplated  by this Agreement shall be issued by any party without the advance
approval  of both the  form and  substance  of the  same by the  parties,  which
approval,  in the case of any Announcement required by applicable law, shall not
be unreasonably  withheld or delayed. The parties agree further that neither the
terms of this Agreement nor any other transaction  contemplated  hereby shall be
divulged to any third party without the written consent of Seller and Purchaser,
and  such  terms  shall  be  divulged  only  to  such  of  their  employees  and
representatives  who shall  have a "need to  know,"  in each case  except to the
extent  that such terms  have been  publicly  released  in  accordance  with the
provisions hereof.

13.3 Sales, Transfer and Documentary Taxes. Seller shall pay all federal,  state
and local sales,  documentary  and other transfer taxes, if any, due as a result
of the purchase, sale and transfer of the Assets in accordance herewith, whether
imposed by law on Seller or Purchaser, and Seller shall indemnify, reimburse and
hold harmless Purchaser in respect of the liability for payment of or failure to
pay any such taxes or the filing of or failure to file any  reports  required in
connection therewith.

13.4 Equitable Relief. The parties  acknowledge and agree that, in the event any
party shall violate or threaten to violate any of the  restrictions of Article V
or Section 13.2 hereof,  the aggrieved  party will be without an adequate remedy
at law and  will,  therefore,  be  entitled  to  enforce  such  restrictions  by
preliminary,  temporary or permanent injunctive or mandatory relief in any court
of competent jurisdiction without the necessity of proving damages,  without the
necessity of posting any bond or other  security,  and without  prejudice to any
other rights and remedies which it may have at law or in equity.

13.5 Entire  Agreement.  This  Agreement,  including  the schedules and exhibits
attached  hereto,  which are a part hereof,  constitutes the entire agreement of
the parties  with respect to the subject  matter  hereof.  The  representations,
warranties,  covenants  and  agreements  set forth in this  Agreement and in the
financial statements, schedules or exhibits delivered pursuant hereto constitute
all the representations, warranties, covenants and agreements of the parties and
upon which the parties  have  relied,  shall not be deemed  waived or  otherwise
affected by any  investigation  made by any party  hereto and,  except as may be
specifically provided herein, no change,  modification,  amendment,  addition or
termination  of this  Agreement  or any part  thereof  shall be valid  unless in
writing and signed by or on behalf of the party to be charged therewith.


                                       33
<PAGE>


13.6 Notices. Any and all notices or other communications or deliveries required
or  permitted  to be given or made  pursuant  to any of the  provisions  of this
Agreement  shall be deemed to have been duly given or made for all purposes when
hand delivered or sent by certified or registered mail, return receipt requested
and postage prepaid, overnight mail or courier, or telecopier as follows:

         If to Purchaser or Parent, at:

         90 Merrick Avenue
         East Meadow, New York 11554
         Attn:  Morton L. Certilman
         Telecopier Number: (516) 794-4529

         With a copy to:

         Certilman Balin Adler & Hyman, LLP
         90 Merrick Avenue
         East Meadow, New York  11554
         Attn: Fred Skolnik, Esq.
         Telecopier Number: (516) 296-7111

         If to Seller, at:

         c/o Barry Lefkowitz
         6787 Market Street
         Upper Darby, PA  19082
         Telecopier Number: (610) 734-3022

         With a copy to:

         Piper Rudnick LLP
         3400 Two Logan Square
         18th and Arch Streets
         Philadelphia, PA 19103
         Attn:  Peter J. Tucci, Esq.
         Telecopier Number: (215) 606-3341

or at such other  address as any party may specify by notice  given to the other
parties in accordance with this Section 13.6.

13.7 Choice of Law; Exclusive Jurisdiction. This Agreement shall be governed by,
and interpreted  and construed in accordance  with, the laws of the State of New
York,  excluding  choice of law principles  thereof.  Each of the parties hereby
irrevocably  and  unconditionally:  (i)  consents and submits for itself and its
property in any action or proceeding relating to this Agreement to the exclusive
jurisdiction  of the federal courts  located within the Eastern  District of the
State of New



                                       34
<PAGE>

York and the state  courts  located  within the County of Nassau in the State of
New York;  (ii) consents  that any such action or  proceeding  may be brought in
such courts,  and waives any objection  that it may now or hereafter have to the
venue of any such action or  proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;  (iii) agrees that service of process in any such action or proceeding
may be effected  by mailing a copy  thereof by  registered  or  certified  mail,
postage prepaid, to Seller, Purchaser or Parent, as appropriate,  at its address
set forth  herein or at such other  address of which the sender  shall have been
previously notified in writing; and (iv) agrees that nothing herein shall affect
the right to effect service of process in any other manner permitted by law.

13.8 Severability.  In the event any clause,  section or part of this  Agreement
shall be held or  declared to be void,  illegal or invalid  for any reason,  all
other clauses, sections or parts of this Agreement which can be effected without
such  void,  illegal  or invalid  clause,  section  or part  shall  nevertheless
continue in full force and effect.

13.9 Successors and Assigns; No Assignment. This Agreement shall be binding upon
and inure to the  benefit of the  parties and their  respective  successors  and
assigns;  provided,  however,  that  Seller  may not assign any of its rights or
delegate  any of its  duties  under this  Agreement  without  the prior  written
consent of Purchaser.

13.10  Headings.  The headings or captions  under sections of this Agreement are
for  convenience  of reference  only and do not in any way modify,  interpret or
construe  the  intent of the  parties or affect  any of the  provisions  of this
Agreement.

13.11 No Third  Party  Beneficiaries.  No Person  not a party to this  Agreement
shall  be  entitled  to  rely  upon or  enforce  any of the  provisions  of this
Agreement.

13.12  Representation by Counsel;  Interpretation.  The parties acknowledge that
they have been  represented by counsel in connection with this Agreement and the
transactions  contemplated  hereby.  Accordingly,  any rule or law or any  legal
decision that would require the  interpretation  of any claimed  ambiguities  in
this  Agreement  against  the party that  drafted it has no  application  and is
expressly  waived by the parties.  The  provisions  of this  Agreement  shall be
interpreted  in a reasonable  manner to give effect to the intent of the parties
hereto.

13.13   Counterparts.   This   Agreement  may  be  executed  in  any  number  of
counterparts,  each of which shall be deemed to be an original  and all of which
together shall constitute one instrument.

13.14  Facsimile  Signatures.   Signatures  hereon  which  are  transmitted  via
facsimile shall be deemed original signatures.

                  [Remainder of page intentionally left blank]


<PAGE>



     WITNESS the execution of this Agreement as of the date first above written.

                                                AIA-DCAP CORP.


                                                By: /s/ Carolann Egelandsdal
                                                   ----------------------------
                                                   Treasurer and Secretary


                                                DCAP GROUP, INC.


                                                By: /s/ Morton L. Certilman
                                                   ----------------------------
                                                   Secretary


                                                AIA ACQUISITION CORP.


                                                By: /s/ Barry Lefkowitz
                                                   ----------------------------
                                                   Vice President


<PAGE>

                         List of Schedules and Exhibits
                      to Asset Purchase Agreement with AIA

Schedules
- ---------

1.3.7             Allocation of Purchase Price
1.4.2             Assumed Liabilities
2.2               Capitalization (Stockholder List)
2.4               Consents
2.6               Financial Statements
2.8               Actions since Balance Sheet
2.11              Intellectual Property
2.12(a)           Litigation, Claims, Compliance with Law
2.12(b)           Litigation, Claims, Compliance with Law - Third Party
2.13              Real Property
2.14              Listed Agreements - Contracts
2.16              Permits and License
2.19              Compensation Information
2.20(a)           Employee Benefit Plans
2.20(b)           Other Pension Plans
2.20(c)           Welfare Plans
2.24              Prior Names and Addresses

Exhibits
- --------

1.3.1             Certificate of Designation
6.7               Lease
6.9               Restrictive Covenant Agreement
6.10              Employment Agreement
7.5               Guaranty and Pledge Agreement
7.6               Registration Rights Agreement
11.5              Pledge Agreement



<PAGE>






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4
<SEQUENCE>4
<FILENAME>ex4_1.txt
<DESCRIPTION>EX 4.1 CERT OF DESIGNATIONS-SERIES A PREFERRED
<TEXT>


                                DCAP GROUP, INC.

          Certificate  of  Designations   of  Preferred   Stock   Authorized  by
          Resolution  of the Board of Directors  Providing for an Issue of 1,000
          Shares of Preferred Stock Designated "Series A Preferred Stock."

          DCAP Group,  Inc. (the  "Corporation"),  a  corporation  organized and
existing  under  the  General  Corporation  Law of the  State  of  Delaware,  in
accordance  with the  provisions  of Section  151 of Title 8 thereof and Article
FOURTH of the Corporation's  Certificate of  Incorporation,  DOES HEREBY CERTIFY
THAT:

          Pursuant to  authority  conferred  upon the Board of  Directors by the
Certificate of Incorporation of the Corporation,  said Board of Directors,  at a
meeting duly held, adopted a resolution  providing for the issuance of up to one
thousand (1,000) shares of the Corporation's Preferred Stock, par value $.01 per
share, designated "Series A Preferred Stock," which resolution is as follows:

          RESOLVED,  that,  pursuant  to the  authority  vested  in the Board of
Directors of the Corporation by the Certificate of  Incorporation,  the Board of
Directors  does  hereby  provide  for and  authorize  the  issuance of up to one
thousand (1,000) shares of the Preferred Stock, par value $.01 per share, of the
Corporation,  to be  designated  "Series A  Preferred  Stock"  of the  presently
authorized  but  unissued  shares  of  Preferred   Stock.   The  voting  powers,
designations,  preferences,  and  relative,  participating,  optional  or  other
special  rights of the Series A Preferred  Stock  authorized  hereunder  and the
qualifications,  limitations and restrictions of such preferences and rights are
as follows:

          (i)  Dividends.

               (a) Dividend Preference. From and after the date hereof, when and
if the Board of Directors of the Corporation declares a dividend or distribution
payable  with  respect to (i) the  Common  Stock or any other  capital  stock or
security  issued by the  Corporation  which is junior to the Series A  Preferred
Stock as to such dividends or distributions, such dividend or distribution shall
not be paid until payment is made to the holders of the Series A Preferred Stock
of all dividends or  distributions  accumulated or accrued through that date, or
(ii) the then outstanding capital stock of the Corporation that is pari passu to
the  Series  A  Preferred  Stock as to such  dividends  or  distributions,  such
dividends or  distributions  shall not be paid unless an  equivalent  payment is
made  to the  holders  of  the  Series  A  Preferred  Stock,  pro  rata,  on the
accumulated  and  unpaid  dividends  or  distributions  payable  to the Series A
Preferred Stock as of the date of such payment.

               (b)  Dividend  Amount  and  Payment.  Holders  of  the  Series  A
Preferred  Stock shall be entitled to receive,  when,  as and if declared by the
Board of  Directors,  out of funds  legally  available  for that  purpose,  with
respect to each share of Series A Preferred Stock, a cash dividend equal to five
percent (5.0%) of the Original Issue Price (as hereinafter defined),  per annum.




<PAGE>

Such dividend shall be cumulative, shall accrue from the closing of that certain
Asset Purchase  Agreement,  entered into on May 28, 2003 but effective as of the
close of business on April 30, 2003, by and among AIA-DCAP Corp. ("Buyer"),  the
Corporation and AIA  Acquisition  Corp.  (the  "Agreement")  (the "Closing") and
shall be payable  quarterly on each January 15, April 15, July 15 and October 15
for the preceding calendar quarter; provided, however, that the initial dividend
payment shall not be made sooner than the first quarterly payment date reflected
above next following the issuance of the certificates  representing the Series A
Preferred  Stock  pursuant  to the  Agreement.  For  purposes  hereof,  the term
"Original Issue Price" shall mean one thousand dollars ($1,000.00).

          (ii) Voting Rights.  Except as required by applicable law, the holders
of the Series A  Preferred  Stock  shall not be  entitled to vote on any matters
required  to  be or  otherwise  submitted  to a  vote  of  stockholders  of  the
Corporation.

          (iii) Redemption.

               (a) Subject to the  requirements of applicable law, on the fourth
anniversary of the Closing (the "Outside Redemption Date"), if any shares of the
Series A  Preferred  Stock  shall be then  outstanding,  the  Corporation  shall
redeem,  for cash, all outstanding  shares of the Series A Preferred Stock, at a
redemption price per share equal to the Original Issue Price,  together with any
accumulated  and unpaid  dividends  thereon to the Outside  Redemption Date (the
"Redemption Price").

               (b) In the  event  the  Corporation  redeems  shares  of Series A
Preferred Stock pursuant to paragraph (a) above,  notice of such redemption (the
"Redemption Notice") shall be given by first class mail, postage prepaid, mailed
not less than ten (10) days nor more than  twenty (20) days prior to the Outside
Redemption  Date,  to each  holder of record of the shares of Series A Preferred
Stock to be redeemed at such  holder's  address as the same appears on the stock
register of the Corporation.  The Redemption Notice shall state: (i) the Outside
Redemption  Date;  (ii) the number of shares of Series A  Preferred  Stock to be
redeemed; (iii) the place or places where certificates for such shares are to be
surrendered for payment of the Redemption  Price; and (iv) that dividends on the
shares to be redeemed will cease to accrue on the Outside Redemption Date.

               (c) In the event the  Corporation  shall make a Substantial  Sale
(as hereinafter  defined) prior to the Outside  Redemption Date, the Corporation
shall give  notice  thereof  (the "Sale  Notice") to the holders of the Series A
Preferred Stock, which notice shall provide for a date (no less than thirty (30)
days nor more than  sixty  (60) days  following  the date  thereof)  (the  "Sale
Redemption Date") upon which, subject to the requirements of applicable law, the
Corporation shall redeem,  for cash, such number of outstanding shares of Series
A Preferred Stock, at the Redemption Price, as is hereinafter provided. The Sale
Notice shall be given by first class mail,  postage  prepaid,  to each holder of
record of shares of Series A Preferred  Stock to be  redeemed  at each  holder's
address as the same appears on the stock register of the  Corporation.  The Sale
Notice shall state:  (i) the Sale Redemption  Date; (ii) the number of shares of
Series A  Preferred  Stock to be  redeemed;  (iii)  the  place or  places  where
certificates for such shares are to be surrendered for payment of the



<PAGE>

Redemption  Price;  and (iv) that  dividends  on the shares to be redeemed  will
cease to accrue on the Sale Redemption Date.

               (d) The  number  of  shares  of  Series A  Preferred  Stock to be
redeemed  pursuant to paragraph  (c) above shall be such number of shares as may
be redeemed at an aggregate  Redemption  Price equal to twenty  percent (20%) of
the net cash proceeds of the  Substantial  Sale. In the event that less than all
of the  outstanding  shares of Series A  Preferred  Stock are to be  redeemed in
connection  with a  Substantial  Sale,  then  the  outstanding  shares  shall be
redeemed  on a pro rata  basis  from all of the  holders  of Series A  Preferred
Stock.

               (e) For purposes hereof, a "Substantial  Sale" shall be deemed to
have occurred if any of the following  occur:  (i) the Corporation  sells all or
substantially all of its assets; (ii) any of Payments, Inc. ("Payments"),  Blast
Acquisition Corp. ("Blast"), Barry Scott Companies Inc. ("BSC") or Buyer, each a
direct or indirect  wholly-owned  subsidiary  of the  Corporation,  sells all or
substantially  all of its assets (except in the case where the purchaser becomes
a  franchisee  of  the  Corporation  or a  subsidiary  thereof);  or  (iii)  the
Corporation  sells all of the  outstanding  stock of Payments or Blast, or Blast
sells all of the  outstanding  stock of BSC or Buyer  (except  in the case where
Blast,  BSC or Buyer  becomes a franchisee  of the  Corporation  or a subsidiary
thereof).

               (f) In the event the Corporation  shall  consummate a "Rule 13e-3
transaction"  (as  such  term  is  defined  in  Rule  13e-3  promulgated  by the
Securities and Exchange  Commission  pursuant to the Securities  Exchange Act of
1934, as amended), the Corporation shall give written notice thereof (the "Going
Private Notice") to the holders of the Series A Preferred Stock.  Each holder of
Series A Preferred Stock thereupon shall have the right,  exercisable by written
notice (the "Redemption Exercise Notice") given to the Corporation within thirty
(30) days of  receipt of the Going  Private  Notice,  to cause the  Corporation,
subject to the  requirements of applicable law, to redeem,  for cash, all or any
portion of such holder's Series A Preferred Stock at the Redemption  Price.  The
Redemption  Exercise  Notice shall  provide for the number of shares of Series A
Preferred Stock that the holder desires that the  Corporation  redeem and a date
(no less than thirty (30) days nor more than sixty (60) days  following the date
thereof (together with the Outside Redemption Date and the Sale Redemption Date,
the "Redemption  Date")) upon which,  subject to the  requirements of applicable
law, the Corporation  shall redeem,  for cash, such number of shares of Series A
Preferred Stock as is set forth in the holder's Redemption Exercise Notice.

               (g) In the case of any redemption  pursuant to paragraph (a), (c)
or (f) above,  as to which any required notice from the Corporation was properly
mailed as  provided  in  paragraph  (b),  (c) or (f)  above,  from and after the
Redemption  Date (unless  default shall be made by the Corporation in paying the
Redemption Price of the shares called for  redemption),  dividends on the shares
of Series A Preferred Stock so called for redemption shall cease to accrue,  and
all rights of the holders thereof as stockholders of the Corporation (except the
right to receive  from the  Corporation  the  Redemption  Price per share) shall
cease. Upon surrender in accordance with said notice of the certificates for any
shares so redeemed (properly endorsed or assigned for transfer,  if the Board of
Directors shall so require and the notice shall so state),  such shares shall be
redeemed by the Corporation at the Redemption Price.



<PAGE>


               (h) The Corporation's  redemption  obligation  hereunder shall be
secured by the pledge by Blast to the original  holder of the Series A Preferred
Stock (the "Original  Holder") of all of the outstanding stock of Buyer pursuant
to a guaranty and pledge agreement, dated as of the date of the Closing, between
Blast and the Original Holder.

          (iv) Conversion.

               (a)  Conversion  Right.  Each share of Series A  Preferred  Stock
shall be  convertible,  at any time and from time to time,  at the option of the
holder thereof, into such number of shares of Common Stock of the Corporation as
is determined by dividing the Original Issue Price by the  Conversion  Price (as
hereinafter  defined).  For purposes hereof,  the term "Conversion  Price" shall
mean fifty cents ($.50), subject to adjustment as hereinafter set forth.

               Before any holder of Series A  Preferred  Stock shall be entitled
to receive  Common  Stock  upon  conversion,  the holder  shall send a notice of
conversion  with respect thereto (the  "Conversion  Notice") and shall surrender
the  certificate(s)  therefor,  duly endorsed,  at the principal  offices of the
Corporation.  Effective upon the Corporation's  receipt of the Conversion Notice
(the "Effective  Conversion  Date"),  the holder shall thereupon be deemed to be
the  holder  of  record  of  the  Common   Stock   issuable   upon   conversion,
notwithstanding  that the stock transfer books of the Corporation  shall then be
closed or that the certificate(s)  representing such Common Stock shall not then
be actually delivered to the holder. Subject to the provisions hereof,  promptly
following the Effective  Conversion  Date, the Corporation  shall issue or cause
its  transfer  agent to issue and  deliver to such  holder of Series A Preferred
Stock a certificate for the number of shares of Common Stock to which the holder
shall be entitled.

               (b)  Adjustment of Conversion Price.

                    (I) Adjustments for Stock Dividends;  Combinations,  Etc. In
the  event  that  the  Corporation   shall  (A)  declare  a  dividend  or  other
distribution on its Common Stock payable in Common Stock of the Corporation; (B)
effect a subdivision  of its  outstanding  Common Stock into a greater number of
shares of Common Stock (by  reclassification,  stock split or otherwise  than by
payment of a dividend in shares of Common  Stock);  (C) effect a combination  of
its outstanding  Common Stock into a lesser number of shares of Common Stock (by
reclassification,  reverse split or otherwise);  (D) issue by  reclassification,
exchange or  substitution of its Common Stock any shares of capital stock of the
Corporation;  or (E)  effect any other  transaction  having a like  effect,  the
Conversion Price in effect immediately prior to such action shall be adjusted so
that, in the event of a conversion at any time after the occurrence of any event
described in (A) through (E) above,  the holder shall be entitled to receive the
shares of Common Stock to which such holder  would have been  finally  entitled,
after  giving  effect  to the  occurrence  of such  event,  as if the  Series  A
Preferred  Stock had been converted into Common Stock  immediately  prior to the
occurrence of such event. An adjustment  made pursuant to this paragraph  (b)(I)
shall  become  effective  immediately  after  the  record  date in the case of a
dividend or other  distribution and shall become effective  immediately upon the
effective  date in the  case of a  subdivision,  combination,  reclassification,
exchange or substitution.



<PAGE>


                    (II) Adjustment for  Consolidation or Merger. In case of any
consolidation or merger to which the Corporation is a party, other than a merger
or  consolidation  in which  the  Corporation  is the  surviving  or  continuing
corporation  and which  does not  result in any  reclassification  of, or change
(other  than a change  in par value or from par value to no par value or from no
par value to par value,  or as a result of a  subdivision  or  combination)  in,
outstanding Common Stock, then in the event of a conversion,  the holder of each
share of Series A Preferred Stock then  outstanding  shall receive,  in exchange
for such  shares of Series A Preferred  Stock,  the kind and amount of shares or
other securities and property  receivable upon such consolidation or merger by a
holder  of the  number  of  shares of Common  Stock  into  which  such  Series A
Preferred   Stock  would  have  been   converted   immediately   prior  to  such
consolidation or merger had the conversion occurred.

               (c) Fractional Shares. No fractional shares of Common Stock shall
be issued upon conversion of Series A Preferred Stock. In lieu of any fractional
shares to which the holder would otherwise be entitled,  the  Corporation  shall
pay, in cash,  an amount  equal to the  product of (i) such  fraction of a share
times (ii) the Current  Market Price Per Share (as  hereinafter  defined) on the
Effective  Conversion  Date. As used herein,  the term "Current Market Price Per
Share"  shall mean the  closing  price,  or, if not  available,  the closing bid
price,  of the Common  Stock as quoted on a national  securities  exchange,  The
Nasdaq Stock Market  ("Nasdaq"),  the NASD OTC  Electronic  Bulletin  Board (the
"Bulletin  Board"),  or The Bulletin Board Exchange (the "BBX"), as the case may
be (or, if there is no closing  price or closing bid price on a particular  day,
then the  closing  price  or, if not  available,  the  closing  bid price on the
nearest  trading date before that day and for which such prices are  available),
and if the Common Stock is not listed on such an exchange,  Nasdaq, the Bulletin
Board or the BBX on such particular day, then the Current Market Price Per Share
shall be  determined  by the Board of  Directors  in good  faith by taking  into
consideration all relevant factors.

               (d)   Reservation  of  Shares  Issuable  Upon   Conversion.   The
Corporation  shall at all times reserve and keep available out of its authorized
but unissued Common Stock, solely for the purpose of effecting the conversion of
the Series A Preferred Stock, such number of its shares of Common Stock as shall
from time to time be  sufficient  to effect the  conversion  of all  outstanding
Series A Preferred Stock; provided, however, that nothing contained herein shall
preclude the  Corporation  from  satisfying  its  obligations  in respect of the
conversion of the Series A Preferred  Stock by delivery of Common Stock which is
held in the treasury of the Corporation.

               (e) Lost, Stolen or Destroyed Certificates. In the event that the
holder notifies the Corporation that the  certificate(s)  representing  Series A
Preferred  Stock have been lost,  stolen or destroyed  and either (i) provides a
letter,  in form  satisfactory  to the  Corporation,  to the effect that it will
indemnify the Corporation from any loss incurred by it in connection  therewith,
and/or (ii) provides an indemnity bond in such amount as is reasonably  required
by the Corporation,  the Corporation having the option of electing either (i) or
(ii) or both, the Corporation  shall accept such letter and/or indemnity bond in
lieu  of the  surrender  of the  certificate(s)  as  otherwise  required  by the
provisions hereof.



<PAGE>


               (f) Certificate as to Adjustments.  Whenever the number of shares
of Common Stock issuable, or the securities or other property deliverable,  upon
the conversion of the Series A Preferred Stock shall be adjusted pursuant to the
provisions  hereof,  the  Corporation  shall give written notice thereof to each
holder of shares of Series A  Preferred  Stock at such  holder's  address  as it
appears on the transfer books of the  Corporation  and shall  forthwith file, at
its  principal  executive  office and with any transfer  agent or agents for the
Series A Preferred  Stock and the Common  Stock,  a  certificate,  signed by the
Chief  Financial  Officer of the  Corporation,  stating  the number of shares of
Common Stock  issuable,  or the  securities or other property  deliverable,  per
share of Series A Preferred Stock  converted,  calculated to the nearest cent or
to the nearest one  one-hundredth  of a share and  setting  forth in  reasonable
detail the method of calculation  and the facts  requiring  such  adjustment and
upon which such  calculation is based.  Each  adjustment  shall remain in effect
until a subsequent adjustment hereunder is required.

               (g) No  Conversion  Charge or Tax.  The  issuance and delivery of
certificates  representing  shares of Common Stock upon the conversion of shares
of Series A Preferred Stock shall be made without charge to the holder of shares
of Series A Preferred  Stock for any issue tax, or other  incidental  expense in
respect of the  issuance  or  delivery of such  certificates  or the  securities
represented  thereby,  all of  which  taxes  and  expenses  shall be paid by the
Corporation.

               (h) Status on  Conversion.  Upon any  conversion of shares of the
Series A Preferred Stock, the shares so converted shall be canceled.

               (i)  Statutory   Restrictions.   The  foregoing   provisions  for
conversion  of the Series A Preferred  Stock shall be subject to all  applicable
statutory limitations and restrictions.

          (v)  Liquidation  Preference.   In  the  event  of  any  voluntary  or
involuntary  liquidation,  dissolution  or  winding up of the  Corporation,  the
holders of Series A Preferred  Stock will be  entitled to receive,  prior and in
preference to any distribution of the assets or surplus funds of the Corporation
to the  holders  of any  Common  Stock  and any other  stock of the  Corporation
ranking in liquidation  junior to the Series A Preferred Stock, by reason of the
ownership thereof,  an amount (the "Series A Preferential  Amount") equal to (A)
the  Original  Issue  Price  and no more,  and (B) all  accumulated  and  unpaid
dividends  thereon.  If, upon the  occurrence  of such an event,  the assets and
funds thus distributable  among the holders of Series A Preferred Stock shall be
insufficient  to  permit  the  payment  to such  holders  of the  full  Series A
Preferential Amount, then the entire assets and funds of the Corporation legally
available for  distribution to the holders of the Series A Preferred Stock shall
be  distributed  ratably  among such holders in accordance  with the  respective
amounts  which would be payable on such shares if all  amounts  payable  thereon
were paid in full.  After the  payment  or  setting  apart of the full  Series A
Preferential  Amount  required  to be paid to the  holders of Series A Preferred
Stock,  the  holders  of Common  Stock and any  other  stock of the  Corporation
ranking in liquidation  junior to the Series A Preferred Stock shall be entitled
to receive  ratably all remaining  assets or surplus  funds of the  Corporation.
Neither the merger or consolidation  of the Corporation,  nor the sale, lease or
conveyance  of all or part of its assets,  shall be deemed to be a  liquidation,



<PAGE>

dissolution or winding up of the affairs of the Corporation,  either voluntarily
or involuntarily, within the meaning of this section.

          (vi) Seniority.  For so long as any shares of Series A Preferred Stock
are issued and  outstanding,  the  Corporation  shall not,  without  the written
consent of the holders of a majority of the then outstanding  shares of Series A
Preferred  Stock,  issue any series of preferred  stock that ranks senior to the
Series A  Preferred  Stock with  respect to dividend  rights or on  liquidation,
dissolution or winding up of the Corporation.

          IN WITNESS WHEREOF, DCAP GROUP, INC. has caused this Certificate to be
executed by its Chief Executive Officer this 28th day of May, 2003.

                                            DCAP GROUP, INC.



                                            By: /s/ Barry Goldstein
                                               --------------------------------
                                               Barry Goldstein,
                                               Chief Executive Officer




</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
