8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of earliest event reported):  December 19, 2005

ICEWEB, INC.

(Exact name of registrant as specified in its charter)

Delaware	0-27865	13-2640971
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

205 Van Buren Street, Suite 150, Herndon, Virginia 20170

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code:  703-964-8000

_________________________________________________

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

On December 19, 2005 entered into a one year Finance Agreement with Sand Hill Finance, LLC under which we can sell certain accounts receivable to the lender on a full recourse basis at 80% of the face amount of the receivable up to an aggregate of $1 million. We agreed to pay Sand Hill Finance, LLC an annual commitment fee of $10,000 and a monthly finance fee of 2% of the average daily balance under the line. After the initial term of the agreement it continues from year to year thereafter unless terminated by either party.

We granted Sand Hill Finance, LLC a blanket security interest in our assets and agreed to refrain from undertaking certain actions while the line is outstanding including entering into a transaction which would result in a change of control of our company or the transfer of more than 20% of our securities. We also agreed not to incur any additional indebtedness other than trade credit in the ordinary course of business.

In the case of an event of default under the terms of the Finance Agreement, at the lender’s option all amounts outstanding under the agreement become immediately due and the lender is entitled to exercise its rights as a secured party. Under the terms of the agreement an event of default includes (i) our failure to fulfill the terms of the agreement or any other material agreement to which we are a party or have incurred any indebtedness, (ii) a breach of any representation, warranty or covenant made under the agreement or the failure to comply with any law to which we are subject, (iii) the occurrence of an insolvency event, or (iv) a material adverse change in our condition or prospects.

We used availability under this agreement to satisfy our outstanding obligation to Comerica Bank and the remainder of availability under this agreement will provide us with additional working capital.

In connection with the Financing Agreement we issued Sand Hill Finance, LLC, a seven year common stock purchase warrant to purchase 25,000 shares of our common stock at an exercise price of $1.00 per share. The warrant contains a cashless exercise provision which means that at the option of the holder, the warrant is convertible into a number of shares of our common stock as determined by dividing the aggregate fair market value of our common stock minus the aggregate exercise price of the warrant by the fair market value of one share of our common stock. The number of shares issuable upon the exercise of the warrant and the exercise price are subject to adjustment in the event of stock dividends, stock splits and reclassifications.

Item 3.02 Unregistered Sales of Equity Sales

On December 28, 2005, we consummated a Preferred Stock Purchase Agreement and relatedagreements with Barron Partners LP. Under the terms of these agreements we issued Barron Partners LP, an accredited investor, 1,833,334 shares of our Series B Convertible Preferred Stock and Common Stock Purchase Warrants “D”, “E” and “F” to purchase an aggregate of 2,250,000 shares of our common stock at exercise prices ranging from $2.00 to $9.60 per share, for an aggregate purchase price of $ 500,000. We are using these proceeds for general working capital.

We received net proceeds of $475,000 after payment of commissions of $25,000 We also issued Liberty Company LLC, a broker-dealer, a Common Stock Purchase Warrant “G” exercisable into 25,000 shares of our common stock with an exercise price of $1.00 per share as additional compensation for its services. The proceeds are being used for general working capital. The transaction was exempt from registration under the Securities Act of 1933 in reliance on an exemption provided by Section 4(2) of that act.

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Under the terms of the Preferred Stock Purchase Agreement, we agreed:

•that all convertible debt in our company would be cancelled and that for a period of three years from the closing date we will not issue any convertible debt or preferred stock. In addition, we agreed to cause all reset features related to any shares of our outstanding common stock to be cancelled and for a period of three years from the closing date to refrain from entering into any transactions that have reset features,

•to maintain a majority of independent directors on our Board of Directors, and that these independent directors will make up a majority of the audit and compensation committees of our Board. If at any time we should fail to maintain these independent majority requirements, we are required to pay Barron Partners LP liquidated damages of 24% of the purchase price of the securities ($120,000) per annum, payable monthly in kind,

•that if within 24 months from the closing date we consummate the sale of debt or equity securities with a conversion price less than the then effective conversion price of the Series B Convertible Preferred Stock we will make a post-closing adjustment in the conversion price of the Series B Convertible Preferred Stock to such lower conversion price,

•that for a period of three years all employment and consulting agreements must have the unanimous consent of the compensation committee of our Board, and any awards other than salary are usual and appropriate for other officers, directors, employees or consultants holding similar positions in similar publicly held-companies,

•that for a period of two years from the closing we will not enter into any new borrowings of more than twice as much as the sum of EBITDA from recurring operations over the past four quarters, subject to certain exceptions,

•that for long as Barron Partners LP holds any of the securities we will not enter into any subsequent financing in which we issue or sell any debt or equity securities with a floating conversion price or containing a reset feature, and

•that we will submit a proposal at our next annual meeting of stockholders to amend our Certificate of Incorporation to require the consent of the holders of a designated percentage of a designated class of our securities to waive or amend the terms of any rights, options and warrants approved by our Board.

Mr. John R. Signorello, our CEO, agreed not to sell any shares of our common stock that he many own in excess of 1% per quarter or at a price of less than $3.00 per share for a period ending August 30, 2007, and that the earliest any other insiders could sell their shares would be beginning two years from the closing date.

We granted Barron Partners LP a right of first to participate in any subsequent funding we may undertake on a pro rata basis at 94% of the offering price.

Series B Convertible Preferred Stock

The designations, rights and preferences of the Series B Convertible Preferred Stock provide:

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•no dividends are payable on the Series B Convertible Preferred Stock. So long as these shares are outstanding, we cannot pay dividends on our common stock nor can we redeem any shares of our common stock,

•the shares of Series B Convertible Preferred Stock do not have any voting rights, except as may be provided under Delaware law,

•so long as the shares are outstanding, we cannot change the designations of the Series B Convertible Preferred Stock, create a class of securities that in the instance of payment of dividends or distribution of assets upon our liquidation ranks senior to or pari passu with the Series B Convertible Preferred Stock or increase the number of authorized shares of Series B Convertible Preferred Stock,

•the shares carry a liquidation preference of $0.2727 per share,

•each share of Series B Convertible Preferred Stock is convertible at the option of the holder into one share of our common stock based upon an initial conversion value of $0.2727 per share. The conversation ratio is subject to adjustment in the event of stock dividends, stock splits or reclassification of our common stock. The conversion ratio is also subject to adjustment in the event we should sell any shares of our common stock or securities convertible into common stock at an effective price less than the conversion ratio then in effect, in which case the conversion ratio would be reduce to the lesser price. No conversion of the Series B Convertible Preferred Stock may occur if a conversion would result in the holder, Barron Partners LP, and any of its affiliates beneficially owning more than 4.9% of our outstanding common shares following such conversion. Barron Partners LP may waive this provision only with the consent of all of the Series B Preferred Stockholders and the consent of the holders of a majority of our outstanding shares of common stock who are not affiliates,

•so long as the Series B Convertible Preferred Stock is outstanding, we have agreed not to issue any rights, options or warrants to holders of our common stock entitling the holders to purchase shares of our common stock at less than the conversion ratio with out the consent of the holders of a majority of the outstanding shares of Series B Convertible Preferred Stock. If we should elect to undertake such an issuance and the Series B holders consent, the conversion ratio would be reduced. Further, if we should make a distribution of any evidence of indebtedness or assets or rights or warrants to subscribe for any security to our common stockholders, the conversion value would be readjusted,

•the shares of Series B Convertible Preferred Stock automatically convert into shares of our common stock in the event of change of control of our company, and

•so long as the shares of Series B Convertible Preferred Stock are outstanding, we cannot sell or issue any common stock, rights to subscribe for shares of common stock or securities which are convertible or exercisable into shares of common stock at an effective purchase price of less than the then conversion value of the Series B Convertible Preferred Stock.

Common Stock Purchase Warrants

In connection with the sale of shares of our Series B Convertible Preferred Stock, we issued the purchaser the following common stock purchase warrants:

• Common Stock Purchase Warrants “D” to purchase an aggregate of 1,000,000 shares of our common stock at an exercise price of $2.00 per share,

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• Common Stock Purchase Warrants “E” to purchase an aggregate of 625,000 shares of our common stock at an exercise price of $4.80 per share, and

• Common Stock Purchase Warrants “F” to purchase an aggregate of 625,000 shares of our common stock at an exercise price of $9.60 per share.

We also issued Liberty Company LLC, a broker dealer which served as finder for us in the transaction, a Common Stock Purchase Warrant “G” to purchase 25,000 shares of our common stock at an exercise price of $1.00 per share. Other than the exercise price, all other terms of the warrant issued to Liberty Company LLC are identical to the Common Stock Purchase Warrants “E” and “F” issued to the purchaser.

The expiration date of the warrants is five years, or 18 months after effectiveness of a registration statement subsequent to the issuance hereof with such 18 months to be extended by one month for each month or portion of a month during which such registration statement’s effectiveness has lapsed or been suspended, whichever is longer. The warrants contain a cashless exercise provision which permits the holder, rather than paying the exercise price in cash, to surrender a number of warrants equal to the exercise price of the warrants being exercised. The holder cannot utilize the cashless exercise feature during the first six months of the term or so long as there is an effective registration statement covering the shares of common stock underlying the warrants. The exercise price of the warrants and the number of shares issuable upon the exercise of the warrants is subject to adjustment in the event of stock splits, stock dividends and reorganizations, as well as if we issue common stock or securities convertible into common stock at an effective price less than the then current exercise price of the warrant.

As with the shares of Series B Convertible Preferred Stock, no exercise of these warrants may occur if a conversion would result in the holder, Barron Partners LP, and any of its affiliates beneficially owning more than 4.9% of our outstanding common shares following such exercise. Barron Partners LP may waive this provision only with the consent of all of the Series B Preferred Stockholders and the consent of the holders of a majority of our outstanding shares of common stock who are not affiliates. This limitation, however, immediately terminates as to the warrants in the event of the sale of all or substantially all of our assets or a merger or consolidation in which we are not the surviving entity.

If our common stock trades at or above $2.85 per share for 20 consecutive trading days, upon notice from us the holder must exercise the Common Stock Purchase Warrant “D” within 45 days, or transfer the warrant to a third party. If the holder elects to so transfer the warrant, the new holder then has an additional 45 days to exercise the Common Stock Purchase Warrant “D”. If we have called the warrants and all or any portion of the warrants are not exercised within these respective periods, the unexercised Common Stock Purchase Warrants “D” will terminate.

Registration Rights

We have agreed to file a registration statement with the Securities and Exchange Commission within 30 days to register for resale the shares of common stock issuable upon the possible conversion of the Series B Convertible Preferred Stock and the exercise of the warrants, and to use our best efforts to cause such registration statement to be declared effective within 120 days from the closing date. We have also granted Barron Partners LP demand registration rights covering these securities, as well as piggy-back registration rights for a period of two years from the closing date. We will pay all costs associated with these registration statements and have indemnified Barron Partners LP with respect thereto for any losses or claims related to material misstatements or material omissions by us in the registration statement(s).

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Item 5.03 Amendment to Articles of Incorporation or Bylaws; Change in Fiscal Year

Our authorized capital includes 10,000,000 shares of blank check preferred stock, par value $0.001 per share, of which 1,666,667 shares have previously been designated as Series A Convertible Preferred Stock. Our Board of Directors, without further stockholder approval, may issue our preferred stock in one or more series from time to time and fix or alter the designations, relative rights, priorities, preferences, qualifications, limitations and restrictions of the shares of each series. In September 2005 our Board of Directors authorized a series of 833,334 shares of blank check preferred stock be designated as Series B Convertible Preferred Stock and on September 28, 2005 we filed a Certificate of Designations of Preferences, Rights and Limitations of Series B Preferred with the Secretary of State of Delaware. On December 29, 2005 we filed an Amended and Restated Certificate of Designations of Preferences, Rights and Limitations of Series B Convertible Preferred Stock increasing the number of shares authorized under this series to 1,833,334 shares. The designations, rights and preferences of the Series B Convertible Preferred Stock are as set forth under Item 3.02 above.

Item 7.01 Regulation FD Disclosure.

On January 26, 2006 we announced the addition of a live online support feature for our IceMAIL and IceVISTA products. A copy of the press release, which is incorporated herein by reference, is attached to this Form 8-K as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits

3.1 Amended and Restated Certificate of Designations of Preferences, Rights and Limitations of Series B Convertible Preferred Stock (1)

4.1 Form of Common Stock Purchase Warrant “D” (1)

4.2 Form of Common Stock Purchase Warrant “E” (1)

4.3 Form of Common Stock Purchase Warrant “F” (1)

4.4 Form of Common Stock Purchase Warrant “G” *

4.5 Form of common stock purchase warrant issued to Sand Hill Finance, LLC. *

10.1 Form of Preferred Stock Purchase Agreement *

10.2 Form of Registration Rights Agreement *

10.3 Form of Financing Agreement with Sand Hill Finance, LLC *

99.1 Press release dated January 26, 2006 *

* filed herewith

(1) Incorporated by reference to the Annual Report for the fiscal year ended September 30, 2005 on Form 10-KSB.

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.

ICEWEB, INC.

Date: January 26, 2006	By:	/s/ John R. Signorello
		John R. Signorello,
		Chief Executive Officer

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EX-4

Exhibit 4.4

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR ANY STATE SECURITIES LAWS AND NEITHER SUCH SHARES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE 1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT.

IN ADDITION, A PREFERRED STOCK PURCHASE AGREEMENT DATED AS OF DECEMBER 28, 2005 (THE “PURCHASE AGREEMENT”), A COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY AT ITS PRINCIPAL EXECUTIVE OFFICE, CONTAINS CERTAIN ADDITIONAL AGREEMENTS BETWEEN THE PARTIES WITH RESPECT TO THIS WARRANT.

__________________________

IceWEB, Inc.

COMMON STOCK PURCHASE WARRANT “G”

Number of Shares: 25,000	Holder: Liberty Company LLC
	c/o Liberty Company LLC
Original Issue Date: December 28, 2005	Principal
	Attn: Philip A. Seifert
	1660 International Drive, Suite 400
Expiration Date: December 28, 2010	McLean, VA 22102
	tel 703-288-5247
Exercise Price per Share: $1.00	fax 703-288-5248

IceWEB, Inc., a company organized and existing under the laws of the State of Delaware (the “Company”), hereby certifies that, for value received, LIBERTY COMPANY LLC, or its registered assigns (the “Warrant Holder”), is entitled, subject to the terms set forth below, to purchase from the Company up to Twenty Five Thousand shares (as adjusted from time to time as provided in Section 7, the “Warrant Shares”) of common stock, $.001 par value (the “Common Stock”), of the Company at a price of One Dollar ($1.00) per Warrant Share (as adjusted from time to time as provided in Section 7, the “Exercise Price”), at any time and from time to time from and after the date thereof and through and including 5:00 p.m. New York City time on December 28, 2010 (or eighteen months of effectiveness of a Registration Statement subsequent to the issuance hereof (such eighteen months to be extended by one month for each month or portion of a month during which a Registration Statement’s effectiveness has lapsed or been suspended), whichever is longer) (the “Expiration Date”), and subject to the following terms and conditions:

1.Registration of Warrant. The Company shall register this Warrant upon records to be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Warrant Holder hereof from time to time. The Company may deem and treat the registered Warrant Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Warrant Holder, and for all other purposes, and the Company shall not be affected by notice to the contrary.

2.Investment Representation. The Warrant Holder by accepting this Warrant represents that the Warrant Holder is acquiring this Warrant for its own account or the account of an affiliate for investment purposes and not with the view to any offering or distribution and that the Warrant Holder will not sell or otherwise dispose of this Warrant or the underlying Warrant Shares in violation of applicable securities laws. The Warrant Holder acknowledges that the certificates representing any Warrant Shares will bear a legend indicating that they have not been registered under the United States Securities Act of 1933, as amended (the “1933 Act”) and may not be sold by the Warrant Holder except pursuant to an effective registration statement or pursuant to an exemption from registration requirements of the 1933 Act and in accordance with federal and state securities laws. If this Warrant was acquired by the Warrant Holder pursuant to the exemption from the registration requirements of the 1933 Act afforded by Regulation S thereunder, the Warrant Holder acknowledges and covenants that this Warrant may not be exercised by or on behalf of a Person during the one year distribution compliance period (as defined in Regulation S) following the date hereof. “Person” means an individual, partnership, firm, limited liability company, trust, joint venture, association, corporation, or any other legal entity.

3.Validity of Warrant and Issue of Shares. The Company represents and warrants that this Warrant has been duly authorized and validly issued and warrants and agrees that all of Common Stock that may be issued upon the exercise of the rights represented by this Warrant will, when issued upon such exercise, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issue thereof. The Company further warrants and agrees that during the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized and reserved a sufficient number of Common Stock to provide for the exercise of the rights represented by this Warrant.

4. Registration of Transfers and Exchange of Warrants.

a.Subject to compliance with the legend set forth on the face of this Warrant, the Company shall register the transfer of any portion of this Warrant in the Warrant Register, upon surrender of this Warrant with the Form of Assignment attached hereto duly completed and signed, to the Company at the office specified in or pursuant to Section 9. Upon any such registration or transfer, a new warrant to purchase Common Stock, in substantially the form of this Warrant (any such new warrant, a “New Warrant”), evidencing the portion of this Warrant so transferred shall be issued to the transferee and a New Warrant evidencing the remaining portion of this Warrant not so

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transferred, if any, shall be issued to the transferring Warrant Holder. The acceptance of the New Warrant by the transferee thereof shall be deemed the acceptance of such transferee of all of the rights and obligations of a Warrant Holder of a Warrant.

b.This Warrant is exchangeable, upon the surrender hereof by the Warrant Holder to the office of the Company specified in or pursuant to Section 9 for one or more New Warrants, evidencing in the aggregate the right to purchase the number of Warrant Shares which may then be purchased hereunder. Any such New Warrant will be dated the date of such exchange.

5. Exercise of Warrants.

a.Upon surrender of this Warrant with the Form of Election to Purchase attached hereto duly completed and signed to the Company, at its address set forth in Section 9, and upon payment and delivery of the Exercise Price per Warrant Share multiplied by the number of Warrant Shares that the Warrant Holder intends to purchase hereunder, in lawful money of the United States of America, in cash or by certified or official bank check or checks, to the Company, all as specified by the Warrant Holder in the Form of Election to Purchase, the Company shall promptly (but in no event later than 7 business days after the Date of Exercise (as defined herein)) issue or cause to be issued and cause to be delivered to or upon the written order of the Warrant Holder and in such name or names as the Warrant Holder may designate (subject to the restrictions on transfer described in the legend set forth on the face of this Warrant), a certificate for the Warrant Shares issuable upon such exercise, with such restrictive legend as required by the 1933 Act. Any person so designated by the Warrant Holder to receive Warrant Shares shall be deemed to have become holder of record of such Warrant Shares as of the Date of Exercise of this Warrant.

b.A “Date of Exercise” means the date on which the Company shall have received (i) this Warrant (or any New Warrant, as applicable), with the Form of Election to Purchase attached hereto (or attached to such New Warrant) appropriately completed and duly signed, and (ii) payment of the Exercise Price for the number of Warrant Shares so indicated by the Warrant Holder to be purchased.

c.This Warrant shall be exercisable at any time and from time to time for such number of Warrant Shares as is indicated in the attached Form of Election To Purchase. If less than all of the Warrant Shares which may be purchased under this Warrant are exercised at any time, the Company shall issue or cause to be issued, at its expense, a New Warrant evidencing the right to purchase the remaining number of Warrant Shares for which no exercise has been evidenced by this Warrant.

d.(i)Notwithstanding anything contained herein to the contrary, the holder of this Warrant may, at its election exercised in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to receive upon such exercise the “Net Number”

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of shares of Common Stock determined according to the following formula (a “Cashless Exercise”):

Net Number = (A x (B - C))/B

(ii) For purposes of the foregoing formula:

A= the total number shares with respect to which this Warrant is then being exercised.

B= the last reported sale price (as reported by Bloomberg) of the Common Stock on the trading day immediately preceding the date of the Exercise Notice.

C= the Warrant Exercise Price then in effect at the time of such exercise.

e.The holder of this Warrant agrees not to elect a Cashless Exercise for a period of six (6) months. The holder of this Warrant also agrees not to elect a Cashless Exercise so long as there is an effective registration statement for the Warrant Shares.

6.Maximum Exercise. The Warrant Holder shall not be entitled to exercise thisWarrant on a Date of Exercise in connection with that number of shares of Common Stock which would be in excess of the sum of (i) the number of shares of Common Stock beneficially owned by the Warrant Holder and its affiliates on an exercise date, and (ii) the number of shares of Common Stock issuable upon the exercise of this Warrant with respect to which the determination of this limitation is being made on an exercise date, which would result in beneficial ownership by the Warrant Holder and its affiliates of more than 4.9% of the outstanding shares of Common Stock on such date. This Section 6 may be waived or amended only with the consent of the Holder and the consent of holders of a majority of the shares of outstanding Common Stock of the Company who are not Affiliates. For the purposes of the immediately preceding sentence, the term “Affiliate” shall mean any person: (a) that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company; or (b) who beneficially owns (i) any shares of the Company’s Series A Convertible Preferred Stock, (ii) the Company’s Common Stock Purchase Warrant “F” dated December 28, 2005, or (iii) this Warrant. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulation 13d-3 thereunder.

7.Adjustment of Exercise Price and Number of Shares. The character of the shares of stock or other securities at the time issuable upon exercise of this Warrant and the Exercise Price therefore, are subject to adjustment upon the occurrence of the following events, and all such adjustments shall be cumulative:

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a.Adjustment for Stock Splits, Stock Dividends, Recapitalizations, Etc. The Exercise Price of this Warrant and the number of shares of Common Stock or other securities at the time issuable upon exercise of this Warrant shall be appropriately adjusted to reflect any stock dividend, stock split, combination of shares, reclassification, recapitalization or other similar event affecting the number of outstanding shares of stock or securities.

b.Adjustment for Reorganization, Consolidation, Merger, Etc. In case of any consolidation or merger of the Company with or into any other corporation, entity or person, or any other corporate reorganization, in which the Company shall not be the continuing or surviving entity of such consolidation, merger or reorganization (any such transaction being hereinafter referred to as a “Reorganization”), then, in each case, the holder of this Warrant, on exercise hereof at any time after the consummation or effective date of such Reorganization (the “Effective Date”), shall receive, in lieu of the shares of stock or other securities at any time issuable upon the exercise of the Warrant issuable on such exercise prior to the Effective Date, the stock and other securities and property (including cash) to which such holder would have been entitled upon the Effective Date if such holder had exercised this Warrant immediately prior thereto (all subject to further adjustment as provided in this Warrant).

c.Certificate as to Adjustments. In case of any adjustment or readjustment in the price or kind of securities issuable on the exercise of this Warrant, the Company will promptly give written notice thereof to the holder of this Warrant in the form of a certificate, certified and confirmed by the Board of Directors of the Company, setting forth such adjustment or readjustment and showing in reasonable detail the facts upon which such adjustment or readjustment is based.

d.The Company sells, grants or issues any shares, options, warrants, or any instrument convertible into shares or equity in any form below $1.00 per share. In the event the Company sells, grants or issues any shares, options, warrants, or any instrument convertible into shares or equity in any form below $1.00 per share the warrant exercise price shall be reduced proportionately. For example, if the Company sells, grants or issues any shares, options, warrants, or any instrument convertible into shares or equity in any form at $7.68 per share, or 20% below $1.00 per share, then the warrant exercise price shall be reduced by 20%. Such reduction shall be made at the time such transaction is made, and shall be cumulative upon any other changes to the exercise of the warrant that may already have been made.

8.Fractional Shares. The Company shall not be required to issue or cause to be issued fractional Warrant Shares on the exercise of this Warrant. The number of full Warrant Shares that shall be issuable upon the exercise of this Warrant shall be computed on the basis of the aggregate number of Warrants Shares purchasable on exercise of this Warrant so presented. If any fraction of a Warrant Share would, except for the provisions of this Section 8, be issuable on the exercise of this Warrant, the Company shall, at its option, (i) pay an amount in cash equal to the Exercise Price multiplied by such fraction or (ii) round the number of Warrant Shares issuable, up to the next whole number.

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9.Sale or Merger of the Company. Upon a Change in Control, the restriction contained in Section 6 shall immediately be released and the Warrant Holder will have the right to exercise this Warrant concurrently with such Change in Control event. For purposes of this Warrant, the term “Change in Control” shall mean a consolidation or merger of the Company with or into another company or entity in which the Company is not the surviving entity or the sale of all or substantially all of the assets of the Company to another company or entity not controlled by the then existing stockholders of the Company in a transaction or series of transactions.

10.Notice of Intent to Sell or Merge the Company. The Company will give Warrant Holder ten (10) business days notice before the event of a sale of all or substantially all of the assets of the Company or the merger or consolidation of the Company in a transaction in which the Company is not the surviving entity.

11.Issuance of Substitute Warrant.In the event of a merger, consolidation, recapitalization or reorganization of the Company or a reclassification of Company shares of stock, which results in an adjustment to the number of shares subject to this Warrant and/or the Exercise Price hereunder, the Company agrees to issue to the Warrant Holder a substitute Warrant reflecting the adjusted number of shares and/or Exercise Price upon the surrender of this Warrant to the Company.

12.Notice. All notices and other communications hereunder shall be in writing and shall be deemed to have been given (i) on the date they are delivered if delivered in person; (ii) on the date initially received if delivered by facsimile transmission followed by registered or certified mail confirmation; (iii) on the date delivered by an overnight courier service; or (iv) on the third business day after it is mailed by registered or certified mail, return receipt requested with postage and other fees prepaid as follows:

If to the Company:

ICEWEB, INC.

205 VanBuren Street, Suite 150

Herndon, VA 20170

Attention: John Signorello, CEO

If to the Warrant Holder:

Liberty Company, LLC

Chairman and CEO of Liberty Company Financial

Attn: Philip A. Seifert

1660 International Drive, Suite 400

McLean, VA 22102

tel 703-288-5247

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13. Miscellaneous.

a.This Warrant shall be binding on and inure to the benefit of the parties hereto and their respective successors and permitted assigns. This Warrant may be amended only by a writing signed by the Company and the Warrant Holder.

b.Nothing in this Warrant shall be construed to give to any person or corporation other than the Company and the Warrant Holder any legal or equitable right, remedy or cause of action under this Warrant; this Warrant shall be for the sole and exclusive benefit of the Company and the Warrant Holder.

c.This Warrant shall be governed by, construed and enforced in accordance with the internal laws of the State of New York without regard to the principles of conflicts of law thereof.

d.The headings herein are for convenience only, do not constitute a part of this Warrant and shall not be deemed to limit or affect any of the provisions hereof.

e.In case any one or more of the provisions of this Warrant shall be invalid or unenforceable in any respect, the validity and enforceablilty of the remaining terms and provisions of this Warrant shall not in any way be affected or impaired thereby and the parties will attempt in good faith to agree upon a valid and enforceable provision which shall be a commercially reasonably substitute therefore, and upon so agreeing, shall incorporate such substitute provision in this Warrant.

f.The Warrant Holder shall not, by virtue hereof, be entitled to any voting or other rights of a shareholder of the Company, either at law or equity, and the rights of the Warrant Holder are limited to those expressed in this Warrant.

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by the authorized officer as of the date first above stated.

ICEWEB, INC., a Delaware corporation

By: ________________________

Name: John R. Signorello

Its: Chief Executive Officer

7

FORM OF ELECTION TO PURCHASE

(To be executed by the Warrant Holder to exercise the right to purchase shares of Common Stock under the foregoing Warrant)

To: IceWEB, Inc.:

In accordance with the Warrant enclosed with this Form of Election to Purchase, the undersigned hereby irrevocably elects to purchase ______________ shares of Common Stock (“Common Stock”), $.001 par value, of IceWEB, Inc, Inc and encloses the warrant and $____ for each Warrant Share being purchased or an aggregate of $________________ in cash or certified or official bank check or checks, which sum represents the aggregate Exercise Price (as defined in the Warrant) together with any applicable taxes payable by the undersigned pursuant to the Warrant.

The undersigned requests that certificates for the shares of Common Stock issuable upon this exercise be issued in the name of:

__________________________________________________

__________________________________________________

__________________________________________________

(Please print name and address)

__________________________________________________

(Please insert Social Security or Tax Identification Number)

If the number of shares of Common Stock issuable upon this exercise shall not be all of the shares of Common Stock which the undersigned is entitled to purchase in accordance with the enclosed Warrant, the undersigned requests that a New Warrant (as defined in the Warrant) evidencing the right to purchase the shares of Common Stock not issuable pursuant to the exercise evidenced hereby be issued in the name of and delivered to:

__________________________________________________

__________________________________________________

__________________________________________________

(Please print name and address)

Dated: _______________ Name of Warrant Holder:

(Print) ____________________________________

(By:) ____________________________________

(Name:) ___________________________________

(Title:) ____________________________________

Signature must conform in all respects to name of

Warrant Holder as specified on the face of the

Warrant

8

EX-4

Exhibit 4.5

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR PURSUANT TO RULE 144 OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.

WARRANT TO PURCHASE STOCK

Corporation:	IceWeb, Inc.
Number of Shares:	25,000
Class of Stock:	Common
Initial Exercise Price:	$2.00 per share of Common Stock
Issue Date:	December __, 2005
Expiration Date:	December __, 2012

THIS WARRANT CERTIFIES THAT, in consideration of the payment of $1.00 and for other good and valuable consideration, SAND HILL FINANCE, LLC or registered assignee (“Holder”) is entitled to purchase the number of fully paid and nonassessable shares (the “Shares”) of Common Stock of ICEWEB, INC., a Delaware corporation (the “Company”), in the number, at the price, and for the term specified above.

ARTICLE 1. EXERCISE

1.1           Method of Exercise. Holder may exercise this Warrant by delivering this Warrant and a duly executed Notice of Exercise in substantially the form attached as Appendix 1 to the principal office of the Company. Unless Holder is exercising the conversion right set forth in Section 1.2, Holder shall also deliver to the Company a check for the aggregate Warrant Price for the Shares being purchased.

1.2          Conversion Right. In lieu of exercising this Warrant as specified in Section 1.1, Holder may from time to time convert this Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share. The fair market value of the Shares shall be determined pursuant to Section 1.3.

1.3           Fair Market Value. If the Shares are traded regularly in a public market, the fair market value of the Shares shall be the closing price of the Shares (or the closing price of the Company’s stock into which the Shares are convertible) reported for the business day immediately before Holder delivers its Notice of Exercise to the Company. If the Shares are not regularly traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment. The foregoing notwithstanding, if Holder advises the Board of Directors in writing that Holder disagrees with such determination, then the Company and Holder shall promptly agree upon a reputable investment banking firm to undertake such valuation. If the valuation of such investment banking firm is greater than that determined by the Board of Directors, then all fees and expenses of such investment banking firm shall be paid by the Company. In all other circumstances, such fees and expenses shall be paid by Holder.

1.4           Delivery of Certificate and New Warrant. Promptly after Holder exercises or converts this Warrant, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired.

1.5          Replacement of Warrants. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, or surrender and cancellation of this Warrant, the Company at its expense shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

1

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

2.1           Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on its common stock payable in common stock, or other securities, subdivides the outstanding common stock into a greater amount of common stock, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares of record as of the date the dividend or subdivision occurred.

2.2          Reclassification, Exchange or Substitution. Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event. Such an event shall include any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the Company’s Certificate of Incorporation upon the closing of a registered public offering of the Company’s common stock. Upon the closing of any sale, license, or other disposition of all or substantially all of the assets (including intellectual property) of the Company, or any reorganization, consolidation, or merger of the Company where the holders of the Company’s securities before the transaction beneficially own less than 50% of the outstanding voting securities of the surviving entity after the transaction, the successor entity shall assume the obligations of this Warrant, and this Warrant thereafter shall be exercisable for the same securities, cash, and property as would be payable for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing. The Warrant Price shall be adjusted accordingly. The Company or its successor shall promptly issue to Holder a new Warrant for such new securities or other property. The new Warrant shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant. The provisions of this Section 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.

2.3           Adjustments for Combinations, Etc. If the outstanding Shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased.

2.4          Certificate as to Adjustments. Upon each adjustment of the Warrant Price, the Company at its expense shall promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based. The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant Price in effect upon the date thereof and the series of adjustments leading to such Warrant Price.

ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

3.1          Representations and Warranties. The Company hereby represents and warrants to the Holder as follows:

(a)           The initial Warrant Price referenced on the first page of this Warrant is not greater than the fair market value of the Shares as of the date of this Warrant.

(b)           All Shares that may be issued upon the exercise of the purchase right represented by this Warrant, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.

(c)           The capitalization table attached hereto correctly sets forth the authorized, issued and outstanding shares of capital stock of the Company and all options to acquire any such shares.

2

3.2           Notice of Certain Events. If the Company proposes at any time (a) to declare any dividend or distribution upon its common stock, whether in cash, property, stock, or other securities and whether or not a regular cash dividend; (b) to offer for subscription pro rata to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights; (c) to effect any reclassification or recapitalization of common stock; (d) to merge or consolidate with or into any other corporation, or sell, lease, license, or convey all or substantially all of its assets, or to liquidate, dissolve or wind up; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the company’s securities for cash, then, in connection with each such event, the Company shall give Holder (1) at least 20 days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription rights (and specifying the date on which the holders of common stock will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (a) and (b) above; (2) in the case of the matters referred to in (c) and (d) above at least 20 days prior written notice of the date when the same will take place (and specifying the date on which the holders of common stock will be entitled to exchange their common stock for securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such registration rights.

3.3           Information Rights. So long as the Holder holds this Warrant and/or any of the Shares, the Company shall deliver to the Holder (a) within ninety (90) days after the end of each fiscal year of the Company, the annual audited financial statements of the Company certified by independent public accountants of recognized standing and (b) within forty-five (45) days after the end of each of the first three quarters of each fiscal year, the Company’s quarterly, unaudited financial statements, provided Company need not provide such information for any period in which Company has filed Form 10Q with the Securities and Exchange Commission.

ARTICLE 4. MISCELLANEOUS.

4.1           Term. This Warrant is exercisable, in whole or in part, at any time and from time to time on or before the Expiration Date set forth above.

4.2          Legends. This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form:

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR PURSUANT TO RULE 144 OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.

4.3          Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise this Warrant (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned in whole or in part without compliance with applicable federal and state securities laws by the transferor and the transferee.

4.4           Transfer Procedure. Subject to the provisions of Section 4.3, Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable, directly or indirectly, upon conversion of the Shares, if any) by giving the Company notice of the portion of the Warrant being transferred setting forth the name, address and taxpayer identification number of the transferee and surrendering this Warrant to the Company for reissuance to the transferee(s) (and Holder, if applicable), provided that no such notice shall be required for a transfer to an affiliate of Holder.

4.5           Notices. All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or the Holder, as the case may be, in writing by the Company or such Holder from time to time.

3

4.6           Waiver. This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of such change, waiver, discharge or termination is sought.

4.7           Attorneys’ Fees. In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorneys’ fees.

4.8          Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to its principles regarding conflicts of law.

4.9.         Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this warrant may not be transferred or assigned in whole or in part without compliance with applicable federal and state securities laws by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company).

4.10.        In issuing this Warrant to Holder, Company relies upon, and in accepting this Warrant, Holder represents that it is acquiring this Warrant and the Shares issuable upon exercise hereof for investment purposes only.

ICEWEB, INC.

By: ______________________________

Name: ______________________________

Title: ______________________________

4

APPENDIX 1

NOTICE OF EXERCISE

1.             The undersigned hereby elects to purchase ______________ shares of the Common Stock of ICEWEB, INC.pursuant to the terms of the attached Warrant, and tenders herewith payment of the purchase price of such shares in full.

1.             The undersigned hereby elects to convert the attached Warrant into Shares in the manner specified in the Warrant. This conversion is exercised with respect to ______________ of the Shares covered by the Warrant.

[Strike paragraph that does not apply.]

2.             Please issue a certificate or certificates representing said shares in the name of the undersigned or in such other name as is specified below:

SAND HILL FINANCE, LLC

____________________

____________________

Or Registered Assignee

3.             The undersigned represents it is acquiring the shares solely for its own account and not as a nominee for any other party and not with a view toward the resale or distribution thereof except in compliance with applicable securities laws.

SAND HILL FINANCE, LLC. or Registered Assignee

________________________________________

(Signature)

________________________________________

(Date)

5

EX-10

Exhibit 10.1

PREFERRED STOCK PURCHASE AGREEMENT

BETWEEN

IceWEB, Inc.

AND

BARRON PARTNERS LP

DATED

September 8, 2005

PREFERRED STOCK PURCHASE AGREEMENT

This PREFERRED STOCK PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of the 8th day of September, 2005 between IceWEB, Inc., a corporation organized and existing under the laws of the State of Delaware and BARRON PARTNERS LP, a Delaware limited partnership (“Investor”).

PRELIMINARY STATEMENT:

WHEREAS, the Investor wishes to purchase from the Company, upon the terms and subject to the conditions of this Agreement, 1,833,334 shares of preferred stock of the Company, with such preferred stock being as described in the Amended and Restated Certificate of Designations of Preferences, Rights and Limitations of Series B Convertible Preferred Stock (the “Certificate of Designations”) in substantially the form attached hereto as Exhibit A (the “Preferred Stock”) for the Purchase Price set forth in Section 1.3.23 hereof. Subject to the limitations set forth herein and in the Certificate of Designation, the Preferred Stock shall be initially convertible into shares of common stock of the Company at any time at a conversion price of 27.27 cents ($0.2727) per share (the “Conversion Value”). In addition, the Company will issue to the Investor three Common Stock Purchase Warrants (the “Warrants”) to purchase up to an additional 2,250,000 shares of common stock of the Company at exercise prices as stated in the Warrants; and

WHEREAS, the parties intend to memorialize the purchase and sale of such Preferred Stock and the Warrants.

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

ARTICLE I

INCORPORATION BY REFERENCE, SUPERSEDER AND DEFINITIONS

1.1                 Incorporation by Reference. The foregoing recitals and the Exhibits and Schedules attached hereto and referred to herein, are hereby acknowledged to be true and accurate, and are incorporated herein by this reference.

STOCK PURCHASE AGREEMENT BETWEEN

ICEWEB, INC. AND BARRON PARTNERS LP

PAGE 1

1.2                 Superseder. This Agreement, to the extent that it is inconsistent with any other instrument or understanding among the parties governing the affairs of the Company, shall supersede such instrument or understanding to the fullest extent permitted by law. A copy of this Agreement shall be filed at the Company’s principal office.

1.3                 Certain Definitions. For purposes of this Agreement, the following capitalized terms shall have the following meanings (all capitalized terms used in this Agreement that are not defined in this Article 1 shall have the meanings set forth elsewhere in this Agreement):

1.3.1      “1933 Act” means the Securities Act of 1933, as amended.

1.3.2      “1934 Act” means the Securities Exchange Act of 1934, as amended.

1.3.3      “Affiliate” means a Person or Persons directly or indirectly, through one or more intermediaries, controlling, controlled by or under common control with the Person(s) in question. The term “control,” as used in the immediately preceding sentence, means, with respect to a Person that is a corporation, the right to the exercise, directly or indirectly, of more than 50 percent of the voting rights attributable to the shares of such controlled corporation and, with respect to a Person that is not a corporation, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such controlled Person.

1.3.4      “Articles” means the Certificate of Incorporation of the Company, as the same may be amended from time to time.

1.3.5      “Closing” shall mean the Closing of the transactions contemplated by this Agreement on the Closing Date.

1.3.6      “Closing Date” means the date on which the payment of the Purchase Price (as defined herein) by the Investor to the company is completed pursuant to this Agreement to purchase the Preferred Stock and Warrants, which shall occur on or before September 8^th, 2005.

1.3.7      “Common Stock” means shares of common stock of the Company, par value $0.001 per share

1.3.8      “Effective Date” shall mean the date the registration statement of the Company covering the shares being subscribed hereby is declared effective.

1.3.9      “Escrow Agreement” shall mean the Escrow Agreement among the Company, the Investor and Ira S. Saul PLC, as Escrow Agent, attached hereto as Exhibit E.

1.3.10   “Material Adverse Effect” shall mean any adverse effect on the business, operations, properties or financial condition of the Company that is material and adverse to the Company and its subsidiaries and affiliates, taken as a whole and/or any condition, circumstance,

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PAGE 2

or situation that would prohibit or otherwise materially interfere with the ability of the Company to perform any of its material obligations under this Agreement or the Registration Rights Agreement or to perform its obligations under any other material agreement.

1.3.11  “Delaware Act” means the Delaware General Corporation Law, as amended.

1.3.12   “Person” means an individual, partnership, firm, Limited Liability Company, trust, joint venture, association, corporation, or any other legal entity.

1.3.13  “Purchase Price” means the $500,000 paid by the Investor to the Company for the Preferred Stock and the Warrants.

1.3.14   Registration Rights Agreement” shall mean the registration rights agreement between the Investor and the Company attached hereto as Exhibit B.

1.3.15  “Registration Statement” shall mean the registration statement under the 1933 Act to be filed with the Securities and Exchange Commission for the registration of the Shares pursuant to the Registration Rights Agreement attached hereto as Exhibit B.

1.3.16 “SEC” means the Securities and Exchange Commission.

1.3.17 “SEC Documents” shall mean the Company’s latest Form 10-K or 10-KSB as of the time in question, all Forms 10-Q or 10-QSB and 8-K filed thereafter, and the Proxy Statement for its latest fiscal year as of the time in question until such time as the Company no longer has an obligation to maintain the effectiveness of a Registration Statement as set forth in the Registration Rights Agreement.

1.3.18 “Shares” shall mean, collectively, the shares of Common Stock of the Company issued upon conversion of the Preferred Stock subscribed for hereunder and those shares of Common Stock issuable to the Investor upon exercise of the Warrants.

1.3.19 “Subsequent Financing” shall mean any offer and sale of shares of Preferred Stock or debt that is convertible into shares of Common Stock or otherwise senior or superior to the Preferred Stock.

1.3.20 “Transaction Documents” shall mean this Agreement, all Schedules and Exhibits attached hereto and all other documents and instruments to be executed and delivered by the parties in order to consummate the transactions contemplated hereby, including, but not limited to the documents listed in Sections 3.2 and 3.3 hereof.

1.3.21 “Warrants” shall mean the Common Stock Purchase Warrants in the form attached hereto Exhibit D.

STOCK PURCHASE AGREEMENT BETWEEN

ICEWEB, INC. AND BARRON PARTNERS LP

PAGE 3

ARTICLE II

SALE AND PURCHASE OF ICEWEB, INC.

PREFERRED STOCK AND WARRANTS PURCHASE PRICE

2.1 Sale of Preferred Stock and Issuance of Warrants.

(a)             Upon the terms and subject to the conditions set forth herein, and in accordance with applicable law, the Company agrees to sell to the Investor, and the Investor agrees to purchase from the Company, on the Closing Date 1,833,334 shares of Preferred Stock and the Warrants for the (the “Purchase Price”) of Five Hundred Thousand Dollars ($500,000.00). The Purchase Price shall be paid by the Investor to the Company on the Closing Date by a wire transfer of the Purchase Price into escrow to be held by the escrow agent pursuant to the terms of the Escrow Agreement. The Company shall cause the Preferred Stock and the Warrants to be issued to the Investor upon the release of the Purchase Price to the Company by the escrow agent pursuant to the terms of the Escrow Agreement. The Company shall register the shares of Common Stock into which the Preferred Stock is convertible pursuant to the terms and conditions of a Registration Rights Agreement attached hereto as Exhibit B.

(b)            The Preferred Stock shall be initially convertible by the Investor into an aggregate total of 1,833,334 shares of Common Stock (the “Conversion Shares”); provided, however, that the Investor shall not be entitled to convert the Preferred Stock into shares of Common Stock that would result in beneficial ownership by the Investor and its affiliates of more than 4.9% of the then outstanding number of shares of Common Stock on such date. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulation 13d-3 thereunder.

(c)             Upon execution and delivery of this Agreement and the Company’s receipt of the Purchase Price from the Escrow Agent pursuant to the terms of the Escrow Agreement, the Company shall issue to the Investor the Warrants to purchase an aggregate of 2,250,000 shares of Common Stock at exercise prices as stated in the Warrants, all pursuant to the terms and conditions of the form of Warrants attached hereto as Exhibit C; provided, however, that the Investor shall not be entitled to exercise the Warrants and receive shares of Common Stock that would result in beneficial ownership by the Investor and its affiliates of more than 4.9% of the then outstanding number of shares of Common Stock on such date. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulation 13d-3 thereunder.

STOCK PURCHASE AGREEMENT BETWEEN

ICEWEB, INC. AND BARRON PARTNERS LP

PAGE 4

2.2          Purchase Price. The Purchase Price shall be delivered by the Investor in the form of a check or wire transfer made payable to the Company in United States Dollars pursuant to the Escrow Agreement on the Closing Date.

ARTICLE III

CLOSING DATE AND DELIVERIES AT CLOSING

3.1          Closing Date  The closing of the transactions contemplated by this Agreement (the “Closing”), unless expressly determined herein, shall be held at the offices of the Company, at 5:00 P.M. local time, on the Closing Date or on such other date and at such other place as may be mutually agreed by the parties, including closing by facsimile with originals to follow.

3.2          Deliveries by the Company. In addition to and without limiting any other provision of this Agreement, the Company agrees to deliver, or cause to be delivered, to the escrow agent under the Escrow Agreement, the following:

(a) At or prior to Closing, an executed Agreement with all exhibits and schedules attached hereto;

(b) At or prior to Closing, an executed Warrants in the name of the Investor in the form attached hereto as Exhibit C;

(c) The executed Registration Rights Agreement;

(d) Certifications in form and substance acceptable to the Company and the Investor from any and all brokers or agents involved in the transactions contemplated hereby as to the amount of commission or compensation payable to such broker or agent as a result of the consummation of the transactions contemplated hereby and from the Company or Investor, as appropriate, to the effect that reasonable reserves for any other commissions or compensation that may be claimed by any broker or agent have been set aside;

(e) Evidence of approval of the Board of Directors and Shareholders of the Company of the Transaction Documents and the transactions contemplated hereby;

(f) Certificate of the President and the Secretary of the Company that the Certificate of Designation has been adopted and filed;

(g) Certificate of Amendment to the Certificate of Incorporation of the Company adopting the provision described in Section 6.20;

(h) Certificates of Existence or Authority to Transact Business of the Company issued by each of the Secretary of State for the State of Delaware and the Clerk of the Commonwealth of Virginia State Corporation Commission;

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PAGE 5

(i) An opinion from the Company’s counsel concerning the Transaction Documents and the transactions contemplated hereby in form and substance reasonably acceptable to Investor;

(j) Stock Certificate in the name of Investor evidencing the Preferred Stock;

(k) The executed Escrow Agreement; and

(l) Such other documents or certificates as shall be reasonably requested by Investor or its counsel.

3.3          Deliveries by Investor. In addition to and without limiting any other provision of this Agreement, the Investor agrees to deliver, or cause to be delivered, to the escrow agent under the Escrow Agreement, the following:

(a) A deposit in the amount of the Purchase Price;

(b) The executed Agreement with all Exhibits and Schedules attached hereto;

(c) The executed Registration Rights Agreement;

(d) Certifications in form and substance acceptable to the Company and the Investor from any and all brokers or agents involved in the transactions contemplated hereby as to the amount of commission or compensation payable to such broker or agent as a result of the consummation of the transactions contemplated hereby and from the Company or Investor as appropriate to the effect that reasonable reserves for any other commissions or compensation that may be claimed by any broker or agent have been set aside;

(e) The executed Escrow Agreement; and

(f) Such other documents or certificates as shall be reasonably requested by the Company or its counsel.

In the event any document provided to the other party in Paragraphs 3.2 and 3.3 herein are provided by facsimile, the party shall forward an original document to the other party within seven (7) business days.

3.4          Further Assurances. The Company and the Investor shall, upon request, on or after the Closing Date, cooperate with each other (specifically, the Company shall cooperate with the Investor, and the Investor shall cooperate with the Company) by furnishing any additional information, executing and delivering any additional documents and/or other instruments and doing any and all such things as may be reasonably required by the parties or their counsel to consummate or otherwise implement the transactions contemplated by this Agreement.

3.5         Waiver. The Investor may waive any of the requirements of Section 3.2 of this Agreement, and the Company at its discretion may waive any of the provisions of Section 3.3 of this Agreement. The Investor may also waive any of the requirements of the Company under the Escrow Agreement.

STOCK PURCHASE AGREEMENT BETWEEN

ICEWEB, INC. AND BARRON PARTNERS LP

PAGE 6

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF

ICEWEB, INC.

The Company represents and warrants to the Investor as of the date hereof and as of Closing (which warranties and representations shall survive the Closing regardless of what examinations, inspections, audits and other investigations the Investor has heretofore made or may hereinafter make with respect to such warranties and representations) as follows:

4.1          Organization and Qualification. ICEWEB, INC. is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, and has the requisite corporate power and authority to own, lease and operate its properties and to carry on its business as it is now being conducted and is duly qualified to do business in any other jurisdiction by virtue of the nature of the businesses conducted by it or the ownership or leasing of its properties, except where the failure to be so qualified will not, when taken together with all other such failures, have a Material Adverse Effect on the business, operations, properties, assets, financial condition or results of operation of ICEWEB, INC. and its subsidiaries taken as a whole.

4.2          Articles of Incorporation and By-Laws. The complete and correct copies of the Company’s Articles and By-Laws, as amended or restated to date which have been filed with the Securities and Exchange Commission are a complete and correct copy of such document as in effect on the date hereof and as of the Closing Date.

4.3          Capitalization.

4.3.1 The authorized and outstanding capital stock of ICEWEB, INC. is set forth in ICEWEB, INC.’s Quarterly Report on Form 10-QSBK, filed on February 17^th, 2005 with the Securities and Exchange Commission and updated on all subsequent SEC Documents. All shares of capital stock have been duly authorized and are validly issued, and are fully paid and no assessable, and free of preemptive rights.

STOCK PURCHASE AGREEMENT BETWEEN

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4.3.2 As of the date of this Agreement, the authorized capital stock of the Company consists of 1,000,000,000 shares of Common Stock ($.001 par value) and 10,000,000 shares of Preferred Stock ($.001 par value), of which approximately 6,492,287 shares of Common Stock ($.001 par value) and 1,666,667 shares of Series A Preferred Stock ($.001 par value) will be issued and outstanding. All outstanding shares of capital stock have been duly authorized and are validly issued, and are fully paid and nonassessable and free of preemptive rights (with the exception of shares held by not more than five (5) persons, whose holdings are contested by the Company, none of which has a Material Adverse Effect on the Company – See Schedule 4.3.2 attached). All shares of capital stock described above to be issued have been duly authorized and when issued, will be validly issued, fully paid and nonassessable and free of preemptive rights.

4.3.3 Except pursuant to this Agreement, in the Preferred Stock Purchase Agreement dated March 30, 2005, and as set forth in Schedule 4.3 hereto, and as set forth in ICEWEB, INC.’s SEC Documents, filed with the SEC, as of the date hereof and as of the Closing Date, there are not now outstanding options, warrants, rights to subscribe for, calls or commitments of any character whatsoever relating to, or securities or rights convertible into or exchangeable for, shares of any class of capital stock of ICEWEB, INC., or agreements, understandings or arrangements to which ICEWEB, INC. is a party, or by which ICEWEB, INC. is or may be bound, to issue additional shares of its capital stock or options, warrants, scrip or rights to subscribe for, calls or commitment of any character whatsoever relating to, or securities or rights convertible into or exchangeable for, any shares of any class of its capital stock. The Company agrees to inform the Investors in writing of any additional warrants granted prior to the Closing Date.

4.3.3 The Company on the Closing Date (i) will have full right, power, and authority to sell, assign, transfer, and deliver, by reason of record and beneficial ownership, to the Investor, ICEWEB, INC. Shares hereunder, free and clear of all liens, charges, claims, options, pledges, restrictions, and encumbrances whatsoever; and (ii) upon conversion of the Preferred Stock or exercise of the Warrants, the Investor will acquire good and marketable title to such Shares, free and clear of all liens, charges, claims, options, pledges, restrictions, and encumbrances whatsoever, except as otherwise provided in this Agreement as to the limitation on the voting rights of such Shares in certain circumstances.

4.4          Authority. ICEWEB, INC. has all requisite corporate power and authority to execute and deliver this Agreement, the Preferred Stock, and the Warrants, to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement by ICEWEB, INC. and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action and no other corporate proceedings on the part of ICEWEB, INC. is necessary to authorize this Agreement or to consummate the transactions contemplated hereby except as disclosed in this Agreement. This Agreement has been duly executed and

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delivered by ICEWEB, INC. and constitutes the legal, valid and binding obligation of ICEWEB, INC., enforceable against ICEWEB, INC. in accordance with its terms.

4.5          No Conflict; Required Filings and Consents.   The execution and delivery of this Agreement by ICEWEB, INC. does not, and the performance by ICEWEB, INC. of their respective obligations hereunder will not: (i) conflict with or violate the Articles or By-Laws of ICEWEB, INC.; (ii) conflict with, breach or violate any federal, state, foreign or local law, statute, ordinance, rule, regulation, order, judgment or decree (collectively, “Laws”) in effect as of the date of this Agreement and applicable to ICEWEB, INC.; or (iii) result in any breach of, constitute a default (or an event that with notice or lapse of time or both would become a default) under, give to any other entity any right of termination, amendment, acceleration or cancellation of, require payment under, or result in the creation of a lien or encumbrance on any of the properties or assets of ICEWEB, INC. pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which ICEWEB, INC. is a party or by ICEWEB, INC. or any of its properties or assets is bound. Excluding from the foregoing are such violations, conflicts, breaches, defaults, terminations, accelerations, creations of liens, or incumbency that would not, in the aggregate, have a Material Adverse Effect.

4.6          Report and Financial Statements. ICEWEB, INC.’s Annual Report on Form 10-K, filed on January 14, 2005, with the SEC, and since amended, contains the audited financial statements of the Company for fiscal year 2004. In addition the company has provided the report for the quarter ending December 31, 2004 on Form 10-QSB, filed on February 17, 2005; the report for the quarter ending March 31, 2005 on Form 10-QSB, filed on May 16, 2005; the report for the quarter ending June 30, 2005 on Form 10-QSB, filed on August 19, 2005; and Form SB-2, filed on July 26, 2005, all filed with the SEC, which have been reviewed by the Company’s auditors. Certain of these filings have been amended from time to time. Collectively, the company has provided “Financial Statements” to the investor which accurately represent the financial condition of the company through June 30, 2005. Each of the balance sheets contained in or incorporated by reference into any such Financial Statements (including the related notes and schedules thereto) fairly presented the financial position of the Company, as of its date, and each of the statements of income and changes in stockholders’ equity and cash flows or equivalent statements in such Financial Statements (including any related notes and schedules thereto) fairly presents, changes in stockholders’ equity and changes in cash flows, as the case may be, of the Company, for the periods to which they relate, in each case in accordance with United States generally accepted accounting principles (“U.S. GAAP”) consistently applied during the periods involved, except in each case as may be noted therein, subject to normal year-end audit adjustments in the case of unaudited statements. The books and records of ICEWEB, INC. have been, and are being, maintained in all material respects in accordance with U.S. GAAP and any other applicable legal and accounting requirements and reflect only actual transaction.

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4.7          Compliance with Applicable Laws. ICEWEB, INC. is not in violation of, or, to the knowledge of ICEWEB, INC. is under investigation with respect to or has been given notice or has been charged with the violation of any Law of a governmental agency, except for violations which individually or in the aggregate do not have a Material Adverse Effect.

4.8          Brokers. Except as set forth on Schedule 4.8, no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or Commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of ICEWEB, INC.

4.9          SEC Documents. ICEWEB, INC. acknowledges that ICEWEB, INC. is a publicly held company and has made available to the Investor after demand true and complete copies of any requested SEC Documents. The Company has registered its Common Stock pursuant to Section 12(d) [15(d)] of the 1934 Act, and the Common Stock is quoted and traded on the OTC Bulletin Board of the National Association of Securities Dealers, Inc. The Company has received no notice, either oral or written, with respect to the continued quotation or trading of the Common Stock on the OTC Bulletin Board. The Company has not provided to the Investor any information that, according to applicable law, rule or regulation, should have been disclosed publicly prior to the date hereof by the Company, but which has not been so disclosed. As of their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934 Act, and rules and regulations of the SEC promulgated thereunder and the SEC Documents did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading..

4.10       Litigation. To the knowledge of ICEWEB, INC., no litigation, claim, or other proceeding before any court or governmental agency is pending or to the knowledge of the Company, threatened against the Company, the prosecution or outcome of which may have a Material Adverse Effect.

4.11       Exemption from Registration. Subject to the accuracy of the Investor’s representations in Article V, except as required pursuant to the Registration Rights Agreement, the sale of the Common Stock and Warrants by the Company to the Investor will not require registration under the 1933 Act, but may require registration under New York state securities law if applicable to the Investor. When validly converted in accordance with the terms of the Preferred Stock, and upon exercise of the Warrants in accordance with their terms, the Shares underlying the Preferred Stock and the Warrants will be duly and validly issued, fully paid, and non-assessable. The Company is issuing the Preferred Stock and the Warrants in accordance with and in reliance upon the exemption from securities registration afforded, inter alia, by Rule 506 under Regulation D as promulgated by the SEC under the 1933 Act, and/or Section 4(2) of the 1933 Act; provided, however, that certain filings and registrations may be required under state securities “blue sky” laws depending upon the residency of the Investor.

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4.12       No General Solicitation or Advertising in Regard to this Transaction. Neither the Company nor any of its Affiliates nor, to the knowledge of the Company, any Person acting on its or their behalf (i) has conducted or will conduct any general solicitation (as that term is used in Rule 502(c) of Regulation D as promulgated by the SEC under the 1933 Act) or general advertising with respect to the sale of the Preferred Stock or Warrants, or (ii) made any offers or sales of any security or solicited any offers to buy any security under any circumstances that would require registration of the Preferred Stock or Warrants, under the 1933 Act, except as required herein.

4.13       No Material Adverse Effect. Except as set forth in Schedule 4.13 attached hereto, since December 31, 2004, no event or circumstance resulting in a Material Adverse Effect has occurred or exists with respect to the Company. No material supplier has given notice, oral or written, that it intends to cease or reduce the volume of its business with the Company from historical levels. Since December 31, 2004, no event or circumstance has occurred or exists with respect to the Company or its businesses, properties, prospects, operations or financial condition, that, under any applicable law, rule or regulation, requires public disclosure or announcement prior to the date hereof by the Company but which has not been so publicly announced or disclosed in writing to the Investor.

4.14       Material Non-Public Information. The Company has not disclosed to the Investors any material non-public information that (i) if disclosed, would reasonably be expected to have a material effect on the price of the Common Stock or (ii) according to applicable law, rule or regulation, should have been disclosed publicly by the Company prior to the date hereof but which has not been so disclosed.

4.15       Internal Controls And Procedures. The Company maintains books and records and internal accounting controls which provide reasonable assurance that (i) all transactions to which the Company or any subsidiary is a party or by which its properties are bound are executed with management’s authorization; (ii) the recorded accounting of the Company’s consolidated assets is compared with existing assets at regular intervals; (iii) access to the Company’s consolidated assets is permitted only in accordance with management’s authorization; and (iv) all transactions to which the Company or any subsidiary is a party or by which its properties are bound are recorded as necessary to permit preparation of the financial statements of the Company in accordance with U.S. generally accepted accounting principles.

4.16       Full Disclosure. No representation or warranty made by ICEWEB, INC. in this Agreement and no certificate or document furnished or to be furnished to the Investor pursuant to this Agreement contains or will contain any untrue statement of a material fact, or omits or will omit to state a material fact necessary to make the statements contained herein or therein not misleading.

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4.17       Independent Board. As of the date of this Agreement and at Closing, the Board of Directors of the Company consists of and shall consist of John R. Signorello, Hal Compton, Joseph Druzak, Raymond Pirtle, and Jack Bush.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF THE INVESTORS

The Investor represents and warrants to the Company that:

5.1          Organization and Standing of the Investor. The Investor is a limited partnership duly formed, validly existing and in good standing under the laws of the State of Delaware. The state in which any offer to purchase shares hereunder was made or accepted by such Investor is the state shown as such Investor’s address. The Investor was not formed for the purpose of investing solely in the Preferred Stock, the Warrants or the shares of Common Stock which are the subject of this Agreement.

5.2          Authorization and Power. The Investor has the requisite power and authority to enter into and perform this Agreement and to purchase the securities being sold to it hereunder. The execution, delivery and performance of this Agreement by the Investor and the consummation by the Investor of the transactions contemplated hereby have been duly authorized by all necessary partnership action where appropriate. This Agreement and the Registration Rights Agreement have been duly executed and delivered by the Investor and at the Closing shall constitute valid and binding obligations of the Investor enforceable against the Investor in accordance with their terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the enforcement of, creditors’ rights and remedies or by other equitable principles of general application.

5.3          No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Investor of the transactions contemplated hereby or relating hereto do not and will not (i) result in a violation of such Investor’s charter documents or bylaws where appropriate or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of any agreement, indenture or instrument to which the Investor is a party, or result in a violation of any law, rule, or regulation, or any order, judgment or decree of any court or governmental agency applicable to the Investor or its properties (except for such conflicts, defaults and violations as would not, individually or in the aggregate, have a Material Adverse Effect on such Investor). The Investor is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to execute, deliver or perform any of such Investor’s obligations under this Agreement or to purchase the securities from the Company in accordance with the terms hereof, provided that for purposes of the representation made in this sentence, the Investor is assuming

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and relying upon the accuracy of the relevant representations and agreements of the Company herein.

5.4          Financial Risks. The Investor acknowledges that such Investor is able to bear the financial risks associated with an investment in the securities being purchased by the Investor from the Company and that it has been given full access to such records of the Company and the subsidiaries and to the officers of the Company and the subsidiaries as it has deemed necessary or appropriate to conduct its due diligence investigation. The Investor is capable of evaluating the risks and merits of an investment in the securities being purchased by the Investor from the Company by virtue of its experience as an investor and its knowledge, experience, and sophistication in financial and business matters and the Investor is capable of bearing the entire loss of its investment in the securities being purchased by the Investor from the Company.

5.5          Accredited Investor. The Investor is (i) an “accredited investor” as that term is defined in Rule 501 of Regulation D promulgated under the 1933 Act by reason of Rule 501(a)(3) and (6), (ii) experienced in making investments of the kind described in this Agreement and the related documents, (iii) able, by reason of the business and financial experience of its officers (if an entity) and professional advisors (who are not affiliated with or compensated in any way by the Company or any of its affiliates or selling agents), to protect its own interests in connection with the transactions described in this Agreement, and the related documents, and (iv) able to afford the entire loss of its investment in the securities being purchased by the Investor from the Company.

5.6          Brokers. Except as set forth in Schedule 4.8, no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or Commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Investor.

5.7          Knowledge of Company. The Investor and such Investor’s advisors, if any, have been, upon request, furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the securities being purchased by the Investor from the Company. The Investor and such Investor’s advisors, if any, have been afforded the opportunity to ask questions of the Company and have received complete and satisfactory answers to any such inquiries.

5.8          Risk Factors The Investor understands that such Investor’s investment in the securities being purchased by the Investor from the Company involves a high degree of risk. The Investor understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the securities being purchased by the Investor from the Company. The Investor warrants that such Investor is able to bear the complete loss of such Investor’s investment in the securities being purchased by the Investor from the Company.

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5.9          Full Disclosure. No representation or warranty made by the Investor in this Agreement and no certificate or document furnished or to be furnished to ICEWEB, INC. pursuant to this Agreement contains or will contain any untrue statement of a material fact, or omits or will omit to state a material fact necessary to make the statements contained herein or therein not misleading. Except as set forth or referred to in this Agreement, Investor does not have any agreement or understanding with any person relating to acquiring, holding, voting or disposing of any equity securities of the Company.

ARTICLE VI

COVENANTS OF THE COMPANY

6.1.         Registration Rights. The Company shall cause the Registration Rights Agreement to remain in full force and effect according to the provisions of the Registration Rights Agreement and the Company shall comply in all material respects with the terms thereof.

6.2.         Reservation Of Common Stock. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all times, free of preemptive rights, shares of Common Stock for the purpose of enabling the Company to issue the shares of Common Stock underlying the Preferred Stock and Warrants.

6.3.        Compliance with Laws. The Company hereby agrees to comply in all respects with the Company’s reporting, filing and other obligations under the Laws.

6.4.        Exchange Act Registration. The Company (a) will continue its obligation to report to the SEC under Section 12(d) of the 1934 Act [or (b) shall register under Section 12(b) or (g) under the 1934 Act and thereafter shall continue to be registered thereunder] and [ in either case] will use its best efforts to comply in all respects with its reporting and filing obligations under the 1934 Act, and will not take any action or file any document (whether or not permitted by the 1934 Act or the rules thereunder) to terminate or suspend any such registration or to terminate or suspend its reporting and filing obligations under the 1934 until the Investors have disposed of all of their Shares.

6.5          Corporate Existence; Conflicting Agreements. The Company will take all steps necessary to preserve and continue the corporate existence of the Company. The Company shall not enter into any agreement, the terms of which agreement would restrict or impair the right or ability of the Company to perform any of its obligations under this Agreement or any of the other agreements attached as exhibits hereto.

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6.6          Preferred Stock. For a period of three years from the closing the Company will not issue any Preferred Stock of the Company

6.7          Convertible Debt. On or prior to the Closing Date, the Company will cause to be cancelled all convertible debt in the Company. For a period of three years from the closing the Company will not issue any convertible debt.

6.8          Reset Equity Deals. On or prior to the Closing Date, the Company will cause to be cancelled any and all reset features related to any shares outstanding that could result in additional shares being issued. For a period of three years from the closing the Company will not enter into any transactions that have any reset features that could result in additional shares being issued.

6.9          Independent Directors. As of the date of this Agreement and as of Closing, The Company shall have caused the appointment of the majority of the board of directors are and shall be to be qualified independent directors, as defined by the NASD, at or before Closing. If at any time after Closing the board shall not be composed in the majority of qualified independent directors, the Company shall pay to the Investors, pro rata, as liquidated damages and not as a penalty, an amount equal to twenty four percent (24%) of the Purchase Price per annum, payable monthly in kind. The parties agree that the only damages payable for a violation of the terms of this Agreement with respect to which liquidated damages are expressly provided shall be such liquidated damages. Nothing shall preclude the Investor from pursuing or obtaining specific performance or other equitable relief with respect to this Agreement. The parties hereto agree that the liquidated damages provided for in this Section 6.9 constitute a reasonable estimate of the damages that may be incurred by the Investor.

6.10       Independent Directors Become Majority of Audit and Compensation Committees. As of the date of this Agreement and as of Closing, a majority of outside directors are and will be serving on the audit and compensation committees of the board of directors. If at any time after Closing such independent directors do not compose the majority of the audit and compensation committees, the Company shall pay to the Investors, pro rata, as liquidated damages and not as a penalty, an amount equal to twenty four percent (24%) of the Purchase Price per annum, payable monthly. The parties agree that the only damages payable for a violation of the terms of this Agreement with respect to which liquidated damages are expressly provided shall be such liquidated damages. Nothing shall preclude the Investor from pursuing other remedies or obtaining specific performance or other equitable relief with respect to this Agreement. The parties hereto agree that the liquidated damages provided for in this Section 6.10 constitute a reasonable estimate of the damages that may be incurred by the Investor by reason of the failure of the Company to appoint at least two independent directors in accordance with the provision hereof.

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6.11       Use of Proceeds. The Company will use the proceeds from the sale of the Preferred Stock and the Warrants (excluding amounts paid by the Company for legal and administrative fees in connection with the sale of such securities) for working capital and acquisitions.

6.12       Right of First Refusal. Each Investor shall have the right to participate in any subsequent funding by the Company on a pro rata basis at ninety-four percent (94%) of the offering price.

6.13       Price Adjustment. If, within the 24 months following the Closing Date, the Company closes on the sale of a note or notes, shares of Common Stock, or shares of any class of Preferred Stock at a price per share of Common Stock, or with a conversion right to acquire Common Stock at a price per share of Common Stock, that is less than the Conversion Price (as adjusted to the capitalization per share as of the Closing Date, following any stock splits, stock dividends, or the like) (collectively, the “Subsequent Conversion Price”), the Company shall make a post-Closing adjustment in the Conversion Price of outstanding preferred stock so that the effective price per share paid by the Investor is reduced to being equivalent to such lower conversion price after taking into account any prior conversions of the Preferred Stock and/or exercises of the Warrant.

6.14       Insider Selling. John R. Signorello agrees to not sell shares of Company common stock in excess of one percent of the total number of shares of Company common stock outstanding per quarter or at a price less than $3.00 per share during the 2 year period following August 30, 2005. The earliest any other “Insiders” can start selling their shares shall be two years from Closing. Insiders shall include all officers and directors of the Company. Andrew Barron Worden and the Investor shall not be considered “Insiders”.

6.15       Employment and Consulting Contracts. For three years after the Closing Company must have a unanimous opinion from the Compensation Committee of the Board of Directors that any awards other than salary are usual, appropriate and reasonable for any officer, director, employee or consultant holding a similar position in other fully reporting public companies with independent majority boards with similar market capitalizations in the same industry with securities listed on the OTCBB, ASE, NYSE or NASDAQ.

6.16       Sale or Merger of Company. In the event of a sale of substantially all of the assets of the Company or a merger or consolidation of the Company in a transaction in which the Company is not the surviving entity, then, subject to and in accordance with the terms of the Warrants, the 4.9% restriction in the Warrants (but not the Preferred Stock) will immediately be terminated and the Investors will have the right to exercise the Warrants concurrent with the sale, subject to the payment by the Investor to the Company of the aggregate exercise price of the Warrant.

6.17        Debt Limitation. The Company agrees for two years after Closing not to enter into any new borrowings of more than twice as much as the sum of the EBITDA from recurring operations over the past four quarters, with the exception of short-term borrowings (“Short Term

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PMSI Secured Borrowing”) to purchase hardware and commercial off-the-shelf (COTS) software to be resold to Company customers for more than the short-term borrowings, where the amount borrowed is secured by a purchase money security interest in the hardware and COTS software being purchased, and said borrowing is to be repaid with accounts receivable from the proceeds of the hardware and COTS software resale to the Company customer. Short Term PMSI Secured Borrowing is permitted to exceed the debt limitation otherwise required by this Paragraph.

6.18       Subsequent Equity Sales. From the date hereof until such time as no Purchaser holds any of the Securities, the Company shall be prohibited from effecting or entering into an agreement to effect any Subsequent Financing involving a “Variable Rate Transaction” or an “MFN Transaction” (each as defined below). The term “Variable Rate Transaction” shall mean a transaction in which the Company issues or sells (i) any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive additional shares of Common Stock either (A) at a conversion, exercise or exchange rate or other price that is based upon and/or varies with the trading prices of or quotations for the shares of Common Stock at any time after the initial issuance of such debt or equity securities, or (B) with a conversion,

exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common Stock. The term “MFN Transaction” shall mean a transaction in which the Company issues or sells any securities in a capital raising transaction or series of related transactions which grants to an investor the right to receive additional shares based upon future transactions of the Company on terms more favorable than those granted to such investor in such offering. Any Purchaser shall be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages. Notwithstanding the foregoing, this Section 4.14 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction or MFN Transaction shall be an Exempt Issuance. Investor waives the violation of Paragraph 6.18 of the Preferred Stock Purchase Agreement dated March 30, 2005 which arises from this Agreement.

6.20       Amendment to Certificate of Incorporation. At or before the next annual meeting of the stockholders of the Company, the Board of Directors shall propose and submit to the holders of the Common Stock for approval, an amendment to the Certificate of Incorporation that provides substantially as follows:

“The terms and conditions of any rights, options and warrants approved by the Board of Directors may provide that any or all of such terms and conditions may be waived or amended only with the consent of the holders of a designated percentage of a designated class or classes of capital stock of the Corporation (or a designated group or groups of holders within such class or classes, including but not limited to disinterested holders), and the applicable terms and conditions of any such rights, options or warrants so conditioned may not be waived or amended absent such consent.”

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ARTICLE VII

COVENANTS OF THE INVESTOR

7.1          Compliance with Law. The Investor’s trading activities with respect to shares of the Company’s Common Stock will be in compliance with all applicable state and federal securities laws, rules and regulations and rules and regulations of any public market on which the Company’s Common Stock is listed.

7.2          Transfer Restrictions. The Investor’s acknowledge that (1) the Preferred Stock, Warrants and shares underlying the Preferred Stock and Warrants have not been registered under the provisions of the 1933 Act, and may not be transferred unless (A) subsequently registered thereunder or (B) the Investor shall have delivered to the Company an opinion of counsel, reasonably satisfactory in form, scope and substance to the Company, to the effect that the Preferred Stock, Warrants and shares underlying the Preferred Stock and Warrants to be sold or transferred may be sold or transferred pursuant to an exemption from such registration; and (2) any sale of the Preferred Stock, Warrants and shares underlying the Preferred Stock and Warrants made in reliance on Rule 144 promulgated under the 1933 Act may be made only in accordance with the terms of said Rule and further, if said Rule is not applicable, any resale of such securities under circumstances in which the seller, or the person through whom the sale is made, may be deemed to be an underwriter, as that term is used in the 1933 Act, may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder.

7.3          Restrictive Legend. The Investor acknowledges and agrees that the Preferred Stock, the Warrants and the Shares underlying the Preferred Stock and Warrants, and, until such time as the Shares underlying the Preferred Stock and Warrants have been registered under the 1933 Act and sold in accordance with an effective Registration Statement, certificates and other instruments representing any of the Shares, shall bear a restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of any such securities):

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS AND NEITHER SUCH SHARES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S, OR (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT.”

7.4           Amendment to Certificate of Incorporation. Investor hereby agrees to vote any shares of capital stock that it may own directly or beneficially, for the amendment to the Certificate of Incorporation referenced in Section 6.20. Pending adoption of such amendment, Investor hereby

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agrees for itself and its successors and assigns that neither this Section 7.4 or Section 6.20 above, or any restriction on exercise of the Warrant shall be amended, modified or waived without the consent of the holders of a majority of the shares of Common Stock held by Persons who are not Affiliates of the Company, or the Investor or Affiliates of the Investor.

ARTICLE VIII

CONDITIONS PRECEDENT TO THE COMPANY’S OBLIGATIONS

The obligation of the Company to consummate the transactions contemplated hereby shall be subject to the fulfillment, on or prior to Closing Date, of the following conditions:

8.1          No Termination. This Agreement shall not have been terminated pursuant to Article X hereof.

8.2          Representations True and Correct. The representations and warranties of the Investor contained in this Agreement shall be true and correct in all material respects on and as of the Closing Date with the same force and effect as if made on as of the Closing Date.

8.3          Compliance with Covenants. The Investor shall have performed and complied in all material respects with all covenants, agreements, and conditions required by this Agreement to be performed or complied by it prior to or at the Closing Date.

8.4          No Adverse Proceedings.    On the Closing Date, no action or proceeding shall be pending by any public authority or individual or entity before any court or administrative body to restrain, enjoin, or otherwise prevent the consummation of this Agreement or the transactions contemplated hereby or to recover any damages or obtain other relief as a result of the transactions proposed hereby.

ARTICLE IX

CONDITIONS PRECEDENT TO INVESTOR’S OBLIGATIONS

The obligation of the Investors to consummate the transactions contemplated hereby shall be subject to the fulfillment, on or prior to Closing Date unless specified otherwise, of the following conditions:

9.1          No Termination. This Agreement shall not have been terminated pursuant to Article X hereof.

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9.2          Representations True and Correct. The representations and warranties of ICEWEB, INC. contained in this Agreement shall be true and correct in all material respects on and as of the Closing Date with the same force and effect as if made on as of the Closing Date.

9.3          Compliance with Covenants. ICEWEB, INC. shall have performed and complied in all material respects with all covenants, agreements, and conditions required by this Agreement to be performed or complied by it prior to or at the Closing Date.

9.4          No Adverse Proceedings.    On the Closing Date, no action or proceeding shall be pending by any public authority or individual or entity before any court or administrative body to restrain, enjoin, or otherwise prevent the consummation of this Agreement or the transactions contemplated hereby or to recover any damages or obtain other relief as a result of the transactions proposed hereby.

ARTICLE X

TERMINATION, AMENDMENT AND WAIVER

10.1 Termination. This Agreement may be terminated at any time prior to the Closing Date:

10.1.1 by mutual written consent of the Investor and the Company;

10.1.2     by the Company upon a material breach of any representation, warranty, covenant or agreement on the part of the Investor set forth in this Agreement, or the Investor upon a material breach of any representation, warranty, covenant or agreement on the part of ICEWEB, INC. set forth in this Agreement, or if any representation or warranty of ICEWEB, INC. or the Investor, respectively, shall have become untrue, in either case such that any of the conditions set forth in Article VIII or Article IX hereof would not be satisfied (a “Terminating Breach”), and such breach shall, if capable of cure, not have been cured within five (5) business days after receipt by the party in breach of a notice from the non-breaching party setting forth in detail the nature of such breach.

10.2       Effect of Termination. Except as otherwise provided herein, in the event of the termination of this Agreement pursuant to Section 10.1 hereof, there shall be no liability on the part of the Company or the Investor or any of their respective officers, directors, agents or other representatives and all rights and obligations of any party hereto shall cease; provided that in the event of a Terminating Breach, the breaching party shall be liable to the non-breaching party for all costs and expenses incurred by the non-breaching party not to exceed $50,000.

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10.3       Amendment. This Agreement may be amended by the parties hereto any time prior to the Closing Date by an instrument in writing signed by the parties hereto.

10.4       Waiver. At any time prior to the Closing Date, ICEWEB, INC. or the Investor, as appropriate, may: (a) extend the time for the performance of any of the obligations or other acts of other party or; (b) waive any inaccuracies in the representations and warranties contained herein or in any document delivered pursuant hereto which have been made to it or them; or (c) waive compliance with any of the agreements or conditions contained herein for its or their benefit. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the party or parties to be bound hereby.

ARTICLE XI

GENERAL PROVISIONS

11.1       Transaction Costs. Except as otherwise provided herein, each of the parties shall pay all of his or its costs and expenses (including attorney fees and other legal costs and expenses and accountants’ fees and other accounting costs and expenses) incurred by that party in connection with this Agreement.

11.2        Indemnification. The Investor agrees to indemnify, defend and hold the Company (following the Closing Date) and its officers and directors harmless against and in respect of any and all claims, demands, losses, costs, expenses, obligations, liabilities or damages, including interest, penalties and reasonable attorney’s fees, that it shall incur or suffer, which arise out of or result from any breach of this Agreement by such Investor or failure by such Investor to perform with respect to any of its representations, warranties or covenants contained in this Agreement or in any exhibit or other instrument furnished or to be furnished under this Agreement. The Company agrees to indemnify, defend and hold the Investor harmless against and in respect of any and all claims, demands, losses, costs, expenses, obligations, liabilities or damages, including interest, penalties and reasonable attorney’s fees, that it shall incur or suffer, which arise out of, result from or relate to any breach of this Agreement or failure by the Company to perform with respect to any of its representations, warranties or covenants contained in this Agreement or in any exhibit or other instrument furnished or to be furnished under this Agreement. In no event shall the Company or the Investors be entitled to recover consequential or punitive damages resulting from a breach or violation of this Agreement nor shall any party have any liability hereunder in the event of gross negligence or willful misconduct of the indemnified party. In the event of a breach of this Agreement by the Company, the Investor shall be entitled to pursue a remedy of specific performance upon tender into the Court an amount equal to the Purchase Price hereunder. The indemnification by the Investor shall be limited to the amount they have invested on the Closing Date.

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11.3       Headings. The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

11.4       Entire Agreement. This Agreement (together with the Schedule, Exhibits, Warrants and documents referred to herein) constitute the entire agreement of the parties and supersede all prior agreements and undertakings, both written and oral, between the parties, or any of them, with respect to the subject matter hereof.

11.5       Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been given (i) on the date they are delivered if delivered in person; (ii) on the date initially received if delivered by facsimile transmission followed by registered or certified mail confirmation; (iii) on the date delivered by an overnight courier service; or (iv) on the third business day after it is mailed by registered or certified mail, return receipt requested with postage and other fees prepaid as follows:

If to ICEWEB, INC.:

205 VanBuren Street, Suite 420

Herndon, VA 20170

Attention: John R. Signorello, CEO

With a copy to:

Ira S. Saul, PLC

4126 Leonard Drive

Fairfax, VA 22030

P.O. Box 3446

Fairfax, VA 22038-3446

Facsimile No.: 703.273.8842

Attn: Ira S. Saul, Esq.

If to the Investor:

Barron Partners L.P.

c/o Barron Capital Advisors, LLC

730 Fifth Avenue, 9^th Floor

New York, New York 10019

Attn: Andrew Barron Worden

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11.6       Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any such term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.

11.7       Binding Effect. All the terms and provisions of this Agreement whether so expressed or not, shall be binding upon, inure to the benefit of, and be enforceable by the parties and their respective administrators, executors, legal representatives, heirs, successors and assignees.

11.8       Preparation of Agreement. This Agreement shall not be construed more strongly against any party regardless of who is responsible for its preparation. The parties acknowledge each contributed and is equally responsible for its preparation.

11.9       Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to applicable principles of conflicts of law.

11.10     Jurisdiction. This Agreement shall be exclusively governed by and construed in accordance with the laws of the State of New York. If any action is brought among the parties with respect to this Agreement or otherwise, by way of a claim or counterclaim, the parties agree that in any such action, and on all issues, the parties irrevocably waive their right to a trial by jury. Exclusive jurisdiction and venue for any such action shall be the Federal Courts serving the State of New York. In the event suit or action is brought by any party under this Agreement to enforce any of its terms, or in any appeal therefrom, it is agreed that the prevailing party shall be entitled to reasonable attorneys fees to be fixed by the arbitrator, trial court, and/or appellate court.

11.11     Preparation and Filing of Securities and Exchange Commission filings. The Investor shall reasonably assist and cooperate with the Company in the preparation of all filings with the SEC after the Closing Date due after the Closing Date.

11.12     Further Assurances, Cooperation. Each party shall, upon reasonable request by the other party, execute and deliver any additional documents necessary or desirable to complete the transactions herein pursuant to and in the manner contemplated by this Agreement. The parties hereto agree to cooperate and use their respective best efforts to consummate the transactions contemplated by this Agreement.

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11.13     Survival The representations, warranties, covenants and agreements made herein shall survive the Closing of the transaction contemplated hereby.

11.14     Third Parties Except as disclosed in this Agreement, nothing in this Agreement, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties hereto and their respective administrators, executors, legal representatives, heirs, successors and assignees. Nothing in this Agreement is intended to relieve or discharge the obligation or liability of any third persons to any party to this Agreement, nor shall any provision give any third persons any right of subrogation or action over or against any party to this Agreement.

11.15     Failure or Indulgence Not Waiver; Remedies Cumulative. No failure or delay on the part of any party hereto in the exercise of any right hereunder shall impair such right or be construed to be a waiver of, or acquiescence in, any breach of any representation, warranty, covenant or agreement herein, nor shall nay single or partial exercise of any such right preclude other or further exercise thereof or of any other right. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any rights or remedies otherwise available.

11.16     Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement. A facsimile transmission of this signed Agreement shall be legal and binding on all parties hereto.

(SIGNATURE BLOCKS FOLLOW ON PAGE 25)

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IN WITNESS WHEREOF, the Investors and the Company have as of the date first written above executed this Agreement.

THE COMPANY:

ICEWEB, INC.,

a Delaware corporation

By:	_______________
	John R. Signorello
Title:	Chairman and Chief Executive Officer

INVESTOR:

BARRON PARTNERS LP

By:	Barron Capital Advisors LLC,
	General Partner

By:	___________________________
	Andrew Barron Worden
	Managing Member
	730 Fifth Avenue, 9th Floor
	New York NY 10019

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Schedule 4.3.2. – Outstanding Common Stock which is not Fully Paid

1.            Wayne Goldstein was formerly a shareholder and principal in Disease Sciences, Inc., the prior name of the Company. When IceWEB was merged into Disease Sciences, Inc. and the name of the corporation changed to IceWEB, Inc., Goldstein was required to surrender his stock certificate and did not do so. The Company has been attempting to locate his whereabouts and will be likewise seeking to cancel his stock certificate which, post 10 for 1 split, is for 50,000,000 shares of common stock. The certificate contains Rule 144 restrictions. Suit to be filed in the Circuit Court of Fairfax County, Virginia

2.            Healthspan is part of the Goldstein group and holds 4,000,000 shares post 10 for 1 split. Its stock certificate was likewise to be surrendered with Goldstein’s and was not. Cancellation of this stock certificate will likewise be sought in litigation to be filed in the Circuit Court of Fairfax County, Virginia. Certificate also contains Rule 144 restrictions.

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Schedule 4.8 – List of Brokers

The Sole broker/dealer for this transaction is Liberty Company Financial, LLC, in which Philip Seifert is principal.

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Exhibit A

Form of Certificate of Designations of Preferences, Rights and Limitations

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Exhibit B

Registration Rights Agreement

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Exhibit C

Warrants

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Exhibit D

Escrow Agreement

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EX-10

Exhibit 10.2

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered into as of the 8^th day of September, 2005 by and among IceWEB, Inc., a corporation organized and existing under the laws of the State of Delaware (“ICEWEB, INC.” or the “Company”), and Barron Partners L.P., a Delaware limited partnership (hereinafter referred to as the “Investor”). Unless defined otherwise, capitalized terms herein shall have the identical meaning as in the Preferred Stock Purchase Agreement.

PRELIMINARY STATEMENT

WHEREAS, pursuant to the Preferred Stock Purchase Agreement, of even date herewith, by and among ICEWEB, INC. and the Investor, as part of the consideration, Investor shall receive Preferred Stock and Warrants, which upon conversion and exercise, in accordance with the terms of the Preferred Stock Purchase Agreement and Warrant Agreement, entitle the Investor to receive Shares of ICEWEB, INC.; and

WHEREAS, the ability of the Investors to sell their Shares of Common Stock is subject to certain restrictions under the 1933 Act; and

WHEREAS, as a condition to the Preferred Stock Purchase Agreement, ICEWEB, INC. has agreed to provide the Investor with a mechanism that will permit such Investor, subject to a market stand-off agreement, to sell its Shares of Common Stock in the future.

NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements, and subject to the terms and conditions herein contained, the parties hereto hereby agree as follows:

ARTICLE I

INCORPORATION BY REFERENCE, SUPERSEDER

1.1Incorporation by Reference. The foregoing recitals and the Exhibits attached hereto and referred to herein, are hereby acknowledged to be true and accurate, and are incorporated herein by this reference.

1.2Superseder. This Agreement, to the extent that it is inconsistent with any other instrument or understanding among the parties governing the affairs of the Company, shall supersede such instrument or understanding to the fullest extent permitted by law. A copy of this Agreement shall be filed at the Company’s principal office.

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ARTICLE II

DEMAND REGISTRATION RIGHTS

2.1“Registrable Securities” means and includes the Shares of ICEWEB, INC. underlying the Preferred Stock and Warrants issued pursuant to the Preferred Stock Purchase Agreement and Warrant Agreement. As to any particular Registrable Securities, such securities will cease to be Registrable Securities when (a) they have been effectively registered under the 1933 Act and disposed of in accordance with the registration statement covering them, (b) they are or may be freely traded without registration pursuant to Rule 144 under the 1933 Act (or any similar provisions that are then in effect), or (c) they have been otherwise transferred and new certificates for them not bearing a restrictive legend have been issued by ICEWEB, INC. and ICEWEB, INC. shall not have “stop transfer” instructions against them. “Shares” shall mean, collectively, the shares of Common Stock of the Company issuable upon conversion of the Preferred Stock and those shares of Common Stock of the Company issuable to the Investor upon exercise of the Warrants.

2.2Registration of Registrable Securities. The Company shall prepare and file within thirty (30) days following the date hereof (the “Filing Date”) a registration statement (the “Registration Statement”) covering the resale of such number of shares of the Registrable Securities as the Investor shall elect by written notice to the Company, and absent such election, covering the resale of all of the shares of the Registrable Securities. The Company shall use its best efforts to cause the Registration Statement to be declared effective by the SEC on the earlier of (i) 120 days following the Closing Date with respect to the Registration Statement, (ii) ten (10) days following the receipt of a “No Review” or similar letter from the SEC or (iii) the first business day following the day the SEC determines the Registration Statement eligible to be declared effective (the “Required Effectiveness Date”). Nothing contained herein shall be deemed to limit the number of Registrable Securities to be registered by the Company hereunder. As a result, should the Registration Statement not relate to the maximum number of Registrable Securities acquired by (or potentially acquirable by) the holders of the Shares of ICEWEB, INC. issued to the Investor pursuant to the Preferred Stock Purchase Agreement, the Company shall be required to promptly file a separate registration statement (utilizing Rule 462 promulgated under the 1933 Act, where applicable) relating to such Registrable Securities which then remain unregistered. The provisions of this Agreement shall relate to any such separate registration statement as if it were an amendment to the Registration Statement.

2.3Demand Registration. Subject to the limitations of Section 2.2, at any time and from time to time, the Investor may request the registration, under the 1933 Act of all or part of the Registrable Shares then outstanding (a “Demand Registration”). Subject to the conditions of Section 3, the Company shall use its best efforts to file such registration

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statement under the 1933 Act as promptly as practicable after the date any such request is received by the Company and to cause such registration statement to be declared effective. The Company shall notify the Investor promptly when any such registration statement has been declared effective. If more than eighty percent (80%) of the Shares issuable under the Preferred Stock Purchase Agreement have been registered or sold, this provision shall expire.

2.4Registration Statement Form. Registrations under Section 2.2 and Section 2.3 shall be on the appropriate registration form of the SEC as shall permit the disposition of such Registrable Securities in accordance with the intended method or methods of disposition specified in the Registration Statement; provided, however, such intended method of disposition shall not include an underwritten offering of the Registrable Securities.

2.5Expenses. The Company will pay all Registration expenses in connection with any registration required by under Sections 2.2 and Section 2.3 herein.

2.6Effective Registration Statement. A registration requested pursuant to Sections 2.2 and Section 2.3 shall not be deemed to have been effected (i) unless a registration statement with respect thereto has become effective within the time period specified herein, provided that a registration which does not become effective after the Company filed a registration statement with respect thereto solely by reason of the refusal to proceed of any holder of Registrable Securities (other than a refusal to proceed based upon the advice of counsel in the form of a letter signed by such counsel and provided to the Company relating to a disclosure matter unrelated to such holder) shall be deemed to have been effected by the Company unless the holders of the Registrable Securities shall have elected to pay all Registration Expenses in connection with such registration, (ii) if, after it has become effective, such registration becomes subject to any stop order, injunction or other order or extraordinary requirement of the SEC or other governmental agency or court for any reason or (iii) if, after it has become effective, such registration ceases to be effective for more than the allowable Black-Out Periods (as defined herein).

2.7Plan Of Distribution. The Company hereby agrees that the Registration Statement shall include a plan of distribution section reasonably acceptable to the Investor; provided, however, such plan of distribution section shall be modified by the Company so as to not provide for the disposition of the Registrable Securities on the basis of an underwritten offering.

2.8Good Faith Preparation and Filing. The Company shall diligently and in good faith prepare and file the Registration Statement and diligently and in good faith pursue said Registration Statement becoming effective. If, after four (4) months from the date hereof, in the event the Company does not register the Registrable Securities pursuant to the requirements of Section 2.2 herein, or if the Registration Statement filed pursuant to Section 2.2 herein is not declared effective, or if the Registrable Securities are registered pursuant to an effective Registration Statement and such Registration Statement or other

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Registration Statement(s) demanded by Investor including the Registrable Securities is not effective in the period from four months from the date hereof through two years following the date hereof, the Company shall not be assessed any penalty or liquidated damages by the Investor whatsoever, it being stipulated that the Company and Investor have reached a fair and equitable agreement through the Purchase Price for the Preferred Stock. Investor waives any and all damages, including counsel fees, costs, lost opportunity costs, and all direct, incidental and consequential damages (if any) arising from a failure by the Company to meet the Required Effectiveness Date

ARTICLE III

INCIDENTAL REGISTRATION RIGHTS

3.1Right To Include (“Piggy-Back”) Registrable Securities. Provided that the Registrable Securities have not been registered, if at any time after the date hereof but before the second anniversary of the date hereof, the Company proposes to register any of its securities under the 1933 Act (other than by a registration in connection with an acquisition in a manner which would not permit registration of Registrable Securities for sale to the public, on Form S-8, or any successor form thereto, on Form S-4, or any successor form thereto and other than pursuant to Section 2), on an underwritten basis (either best-efforts or firm-commitment), then, the Company will each such time give prompt written notice to all holders of Registrable Securities of its intention to do so and of such holders of Registrable Securities’ rights under this Section 3.1. Upon the written

request of any such holders of Registrable Securities made within ten (10) days after the receipt of any such notice (which request shall specify the Registrable Securities intended to be disposed of by such holders of Registrable Securities and the intended method of disposition thereof), the Company will, subject to the terms of this Agreement, use its commercially reasonable best efforts to effect the registration under the 1933 Act of the Registrable Securities, to the extent requisite to permit the disposition (in accordance with the intended methods thereof as aforesaid) of such Registrable Securities so to be registered, by inclusion of such Registrable Securities in the registration statement which covers the securities which the Company proposes to register, provided that if, at any time after written notice of its intention to register any securities and prior to the effective

date of the registration statement filed in connection with such registration, the Company shall determine for any reason either not to register or to delay registration of such securities, the Company may, at its election, give written notice of such determination to each holders of Registrable Securities and, thereupon, (i) in the case of a determination not to register, shall be relieved of this obligation to register any Registrable Securities in connection with such registration (but not from its obligation to pay the Registration Expenses in connection therewith), without prejudice, however, to the rights of any holder or holders of Registrable Securities entitled to do so to request that such registration be effected as a registration under Section 2, and (ii) in the case of a determination to delay registering, shall be permitted to delay registering any Registrable Securities, for the same period as the delay in registering such other securities. No

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registration effected under this Section 3.1 shall relieve the Company of its obligation to effect any registration upon request under Section 2. The Company will pay all Registration Expenses in connection with each registration of Registrable Securities requested pursuant to this Section 3.1. The right provided the Holders of the Registrable Securities pursuant to this Section shall be exercisable at their sole discretion and will in no way limit any of the Company’s obligations to pay the Securities according to their terms.

3.2Priority In Incidental Registrations. If the managing underwriter of the underwritten offering contemplated by this Section 3 shall inform the Company and holders of the Registrable Securities requesting such registration by letter of its belief that the number of securities requested to be included in such registration exceeds the number which can be sold in such offering, then the Company will include in such registration, to the extent of the number which the Company is so advised can be sold in such offering, (i) first securities proposed by the Company to be sold for its own account, and (ii) second Registrable Securities and (iii) securities of other selling security holders requested to be included in such registration.

ARTICLE IV

REGISTRATION PROCEDURES

4.1REGISTRATION PROCEDURES. If and whenever the Company is required to effect the registration of any Registrable Securities under the 1933 Act as provided in Section 2.2 and, as applicable, 2.3, the Company shall, as expeditiously as possible:

(i)prepare and file with the SEC the Registration Statement, or amendments thereto, to effect such registration (including such audited financial statements as may be required by the 1933 Act or the rules and regulations promulgated thereunder) and thereafter use its commercially reasonable best efforts to cause such registration statement to be declared effective by the SEC, as soon as practicable, but in any event no later than the Required Effectiveness Date (with respect to a registration pursuant to Section 2.2); provided, however, that before filing such registration statement or any amendments thereto, the Company will furnish to the counsel selected by the holders of Registrable Securities which are to be included in such registration, copies of all such documents proposed to be filed;

(ii)with respect to any registration statement pursuant to Section 2.2 or Section 2.3, prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective and to comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities covered by such registration statement until the earlier to occur of thirty six (36) months after the

date of this Agreement (subject to the right of the Company to suspend the effectiveness

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thereof for not more than 10 consecutive Trading Days or an aggregate of 10 Trading Days during each year (each a “Black-Out Period”)) or such time as all of the securities which are the subject of such registration statement cease to be Registrable Securities (such period, in each case, the “Registration Maintenance Period”). The Company must notify the Investor within twenty four (24) hours prior to any Black-Out Period;

(iii)furnish to each holder of Registrable Securities covered by such registration statement such number of conformed copies of such registration statement and of each such amendment and supplement thereto (in each case including all exhibits), such number of copies of the prospectus contained in such registration statement (including each preliminary prospectus and any summary prospectus) and any other prospectus filed under Rule 424 under the 1933 Act, in conformity with the requirements of the 1933 Act, and such other documents, as such holder of Registrable Securities and underwriter, if any, may reasonably request in order to facilitate the public sale or other disposition of the Registrable Securities owned by such holder of Registrable Securities;

(iv)use its commercially reasonable best efforts to register or qualify all Registrable Securities and other securities covered by such registration statement under such other U.S. federal or state securities laws or U.S. state blue sky laws as any U.S. holder of Registrable Securities thereof shall reasonably request, to keep such registrations or qualifications in effect for so long as such registration statement remains in effect, and take any other action which may be reasonably necessary to enable such holder of Registrable Securities to consummate the disposition in such jurisdictions of the securities owned by such holder of Registrable Securities, except that the Company shall not for any such purpose be required to qualify generally to do business as a foreign corporation in any jurisdiction wherein it would not but for the requirements of this subdivision (iv) be obligated to be so qualified or to consent to general service of process in any such jurisdiction;

(v)use its commercially reasonable best efforts to cause all Registrable Securities covered by such registration statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the U.S. holder of Registrable Securities thereof to consummate the disposition of such Registrable Securities;

(vi)furnish to each holder of Registrable Securities a signed counterpart, addressed to such holder of Registrable Securities, and the underwriters, if any, of an opinion of counsel for the Company, dated the effective date of such registration statement (or, if such registration includes an underwritten public offering, an opinion dated the date of the closing under the underwriting agreement), reasonably satisfactory in form and substance to such holder of Registrable Securities) including that the prospectus and any prospectus supplement forming a part of the Registration Statement does not contain an untrue statement of a material fact or omits a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and

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(vii)notify the Investor and its counsel promptly and confirm such advice in writing promptly after the Company has knowledge thereof:

(A)when the Registration Statement, the prospectus or any prospectus supplement related thereto or post-effective amendment to the Registration Statement has been filed, and, with respect to the Registration Statement or any post-effective amendment thereto, when the same has become effective;

(B)of any request by the SEC for amendments or supplements to the Registration Statement or the prospectus or for additional information;

(C)of the issuance by the SEC of any stop order suspending the effectiveness of the Registration Statement or the initiation of any proceedings by any Person for that purpose; and

(D)of the receipt by the Company of any notification with respect to the suspension of the qualification of any Registrable Securities for sale under the securities or blue sky laws of any jurisdiction or the initiation or threat of any proceeding for such purpose;

(viii)notify each holder of Registrable Securities covered by such registration statement, at any time when a prospectus relating thereto is required to be delivered under the 1933 Act, upon discovery that, or upon the happening of any event as a result of which, the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state any material facts required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing, and at the request of any such holder of Registrable Securities promptly prepare and furnish to such holder of Registrable Securities a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing;

(ix)use its best efforts to obtain the withdrawal of any order suspending the effectiveness of the Registration Statement at the earliest possible moment;

(x)otherwise use its commercially reasonable best efforts to comply with all applicable rules and regulations of the SEC, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months, but not more than eighteen months, beginning with the first full calendar month after the effective date of such registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the 1933 Act and Rule 158 thereunder;

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(xi)enter into such agreements and take such other actions as the Investors shall reasonably request in writing (at the expense of the requesting or benefiting Investors) in order to expedite or facilitate the disposition of such Registrable Securities; and

(xii)use its commercially reasonable best efforts to list all Registrable Securities covered by such registration statement on any securities exchange on which any of the Registrable Securities are then listed.

The Company may require each holder of Registrable Securities as to which any registration is being effected to furnish the Company such information regarding such holder of Registrable Securities and the distribution of such securities as the Company may from time to time reasonably request in writing.

4.2The Company will not file any registration statement pursuant to Section 2.2 or Section 2.3, or amendment thereto or any prospectus or any supplement thereto to which the Investors shall reasonably object, provided that the Company may file such documents in a form required by law or upon the advice of its counsel.

4.3The Company represents and warrants to each holder of Registrable Securities that it has obtained all necessary waivers, consents and authorizations necessary to execute this Agreement and consummate the transactions contemplated hereby other than such waivers, consents and/or authorizations specifically contemplated by the Preferred Stock Purchase Agreement.

4.4Each holder of Registrable Securities agrees that, upon receipt of any notice from the Company of the occurrence of any event of the kind described in subdivision (viii) of Section 4.1, such Holder will forthwith discontinue such holder of Registrable Securities’ disposition of Registrable Securities pursuant to the Registration Statement relating to such Registrable Securities until such holder of Registrable Securities’ receipt of the copies of the supplemented or amended prospectus contemplated by subdivision (viii) of Section 4.1 and, if so directed by the Company, will deliver to the Company (at the Company’s expense) all copies, other than permanent file copies, then in such Holder’s possession of the prospectus relating to such Registrable Securities current at the time of receipt of such notice.

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ARTICLE V

UNDERWRITTEN OFFERINGS

5.1Incidental Underwritten Offerings. If the Company at any time proposes to register any of its securities under the 1933 Act as contemplated by Section 3.1 and such securities are to be distributed by or through one or more underwriters, the Company will, if requested by any holder of Registrable Securities as provided in Section 3.1 and subject to the provisions of Section 3.2, use its commercially reasonable best efforts to arrange for such underwriters to include all the Registrable Securities to be offered and sold by such holder among the securities to be distributed by such underwriters. In no event shall any Investor be deemed an underwriter for purposes of this Agreement.

5.2Participation In Underwritten Offerings. No holder of Registrable Securities may participate in any underwritten offering under Section 3.1 unless such holder of Registrable Securities (i) agrees to sell such Person’s securities on the basis provided in any underwriting arrangements approved, subject to the terms and conditions hereof, by the holders of a majority of Registrable Securities to be included in such underwritten offering and (ii) completes and executes all questionnaires, indemnities, underwriting agreements and other documents (other than powers of attorney) required under the terms of such underwriting arrangements. Notwithstanding the foregoing, no underwriting agreement (or other agreement in connection with such offering) shall require any holder of Registrable Securities to make a representation or warranty to or agreements with the Company or the underwriters other than representations and warranties contained in a writing furnished by such holder of Registrable Securities expressly for use in the related registration statement or representations, warranties or agreements regarding such holder of Registrable Securities, such holder’s Registrable Securities and such holder’s intended method of distribution and any other representation required by law.

5.3Preparation; Reasonable Investigation. In connection with the preparation and filing of each registration statement under the 1933 Act pursuant to this Agreement, the Company will give the holders of Registrable Securities registered under such registration statement, and their respective counsel and accountants, the opportunity to participate in the preparation of such registration statement, each prospectus included therein or filed with the SEC, and each amendment thereof or supplement thereto, and will give each of them such access to its books and records and such opportunities to discuss the business of the Company with its officers and the independent public accountants who have certified its financial statements as shall be necessary, in the reasonable opinion of such holders’ and such underwriters’ respective counsel, to conduct a reasonable investigation within the meaning of the 1933 Act.

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ARTICLE VI

INDEMNIFICATION

6.1Indemnification by the Company. In the event of any registration of any securities of the Company under the 1933 Act, the Company will, and hereby does agree to indemnify and hold harmless the holder of any Registrable Securities covered by such registration statement, its directors and officers, each other Person who participates as an underwriter in the offering or sale of such securities and each other Person, if any, who controls such holder or any such underwriter within the meaning of the 1933 Act against any losses, claims, damages or liabilities, joint or several, to which such holder or any such director or officer or underwriter or controlling person may become subject under the 1933 Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in any registration statement under which such securities were registered under the 1933 Act, any preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or supplement thereto, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and the Company will reimburse such holder and each such director, officer, underwriter and controlling person for any legal or any other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, liability, action or proceeding, provided that the Company shall not be liable in any such case to the extent that any such loss, claim, damage, liability, (or action or proceeding in respect thereof) or expense arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, any such preliminary prospectus, final prospectus, summary prospectus, amendment or supplement in reliance upon and in conformity with written information furnished to the Company by such holder or underwriter stating that it is for use in the preparation thereof and, provided further that the Company shall not be liable to any Person who participates as an underwriter in the offering or sale of Registrable Securities or to any other Person, if any, who controls such underwriter within the meaning of the 1933 Act, in any such case to the extent that any such loss, claim, damage, liability (or action or proceeding in respect thereof) or expense arises out of such Person’s failure to send or give a copy of the final prospectus, as the same may be then supplemented or amended, within the time required by the 1933 Act to the Person asserting the existence of an untrue statement or alleged untrue statement or omission or alleged omission at or prior to the written confirmation of the sale of Registrable Securities to such Person if such statement or omission was corrected in such final prospectus or an amendment or supplement thereto. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such holder or any such director, officer, underwriter or controlling person and shall survive the transfer of such securities by such holder.

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6.2Indemnification by the Investor. The Company may require, as a condition to including any Registrable Securities in any registration statement filed pursuant to this Agreement, that the Company shall have received an undertaking satisfactory to it from the prospective holder of such Registrable Securities, to indemnify and hold harmless (in the same manner and to the same extent as set forth in Section 6.1) the Company, each director of the Company, each officer of the Company and each other Person, if any, who controls the Company within the meaning of the 1933 Act, with respect to any statement or alleged statement in or omission or alleged omission from such registration statement, any preliminary prospectus, final prospectus or summary prospectus contained therein, or any amendment or supplement thereto, if such statement or alleged statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company through an instrument duly executed by such holder of Registrable Securities specifically stating that it is for use in the preparation of such registration statement, preliminary prospectus, final prospectus, summary prospectus, amendment or supplement. Any such indemnity shall remain in full force and effect, regardless of any investigation made by or on behalf of the Company or any such director, officer or controlling person and shall survive the transfer of such securities by such Investor. The indemnification by the Investors shall be limited to Fifty Thousand ($50,000) Dollars.

6.3Notices Of Claims, Etc. Promptly after receipt by an indemnified party of notice of the commencement of any action or proceeding involving a claim referred to in Sections 6.1 and Section 6.2, such indemnified party will, if claim in respect thereof is to be made against an indemnifying party, give written notice to the latter of the commencement of such action, provided that the failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligations under Sections 6.1 and Section 6.2, except to the extent that the indemnifying party is actually prejudiced by such failure to give notice. In case any such action is brought against an indemnified party, unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist in respect of such claim, the indemnifying party shall be entitled to participate in and to assume the defense thereof, jointly with any other indemnifying party similarly notified, to the extent that the indemnifying party may wish, with counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party for any legal or other expenses subsequently incurred by the latter in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the consent of the indemnified party, consent to entry of any judgment or enter into any settlement of any such action which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability, or a covenant not to sue, in respect to such claim or litigation. No indemnified party shall consent to entry of any judgment or enter into any settlement of any such action the defense of which has been assumed by an indemnifying party without the consent of such indemnifying party.

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6.4Other Indemnification. Indemnification similar to that specified in Sections 6.1 and Section 6.2 (with appropriate modifications) shall be given by the Company and each holder of Registrable Securities (but only if and to the extent required pursuant to the terms herein) with respect to any required registration or other qualification of securities under any Federal or state law or regulation of any governmental authority, other than the 1933 Act.

6.5Indemnification Payments. The indemnification required by Sections 6.1 and Section 6.2 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or expense, loss, damage or liability is incurred.

6.6Contribution. If the indemnification provided for in Sections 6.1 and Section 6.2 is unavailable to an indemnified party in respect of any expense, loss, claim, damage or liability referred to therein, then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such expense, loss, claim, damage or liability (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the holder of Registrable Securities or underwriter, as the case may be, on the other from the distribution of the Registrable Securities or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and of the holder of Registrable Securities or underwriter, as the case may be, on the other in connection with the statements or omissions which resulted in such expense, loss, damage or liability, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the holder of Registrable Securities or underwriter, as the case may be, on the other in connection with the distribution of the Registrable Securities shall be deemed to be in the same proportion as the total net proceeds received by the Company from the initial sale of the Registrable Securities by the Company to the purchasers bear to the gain, if any, realized by all selling holders participating in such offering or the underwriting discounts and commissions received by the underwriter, as the case may be. The relative fault of the Company on the one hand and of the holder of Registrable Securities or underwriter, as the case may be, on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission to state a material fact relates to information supplied by the Company, by the holder of Registrable Securities or by the underwriter and the parties’ relative intent, knowledge, access to information supplied by the Company, by the holder of Registrable Securities or by the underwriter and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission, provided that the foregoing contribution agreement shall not inure to the benefit of any indemnified party if indemnification would be unavailable to such indemnified party by reason of the provisions contained herein, and in no event shall the obligation of any indemnifying party to contribute under this Section 6.6 exceed the amount that such indemnifying party would have been obligated to pay by way of indemnification if the indemnification provided for hereunder had been available under the circumstances.

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The Company and the holders of Registrable Securities agree that it would not be just and equitable if contribution pursuant to this Section 6.6 were determined by pro rata allocation (even if the holders of Registrable Securities and any underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth herein, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.

Notwithstanding the provisions of this Section 6.6, no holder of Registrable Securities or underwriter shall be required to contribute any amount in excess of the amount by which (i) in the case of any such holder, the net proceeds received by such holder from the sale of Registrable Securities in the applicable Registration Statement or (ii) in the case of an underwriter, the total price at which the Registrable Securities purchased by it and distributed to the public were offered to the public exceeds, in any such case, the amount of any damages that such holder or underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

ARTICLE VII

RULE 144

7.1Rule 144. The Company shall timely file in a timely manner the reports required to be filed by the Company under the 1933 Act and the 1934 Act (including but not limited to the reports under Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c) of Rule 144 adopted by the SEC under the 1933 Act) and the rules and regulations adopted by the SEC thereunder (or, if the Company is not required to file such reports, will, upon the request of any holder of Registrable Securities, make publicly available other information) and will take such further action as any holder of Registrable Securities may reasonably request, all to the extent required from time to time to enable such holder to sell Registrable Securities without registration under the 1933 Act within the limitation of the exemptions provided by (a) Rule 144 under the 1933 Act, as such Rule may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the SEC. Upon the request of any holder of Registrable Securities, the Company will deliver to such holder a written statement as to whether it has complied with the requirements of this Section 7.1.

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ARTICLE VIII

MISCELLANEOUS

8.1Amendments And Waivers. This Agreement may be amended and the Company may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company shall have obtained the written consent to such amendment, action or omission to act, of the holder or holders of the sum of the fifty-one percent (51%) or more of the shares of (i) Registrable Securities issued at such time, plus (ii) Registrable Securities issuable upon exercise or conversion of the Securities then constituting derivative securities (if such Securities were not fully exchanged or converted in full as of the date such consent if sought). Each holder of any Registrable Securities at the time or thereafter outstanding shall be bound by any consent authorized by this Section 8.1, whether or not such Registrable Securities shall have been marked to indicate such consent.

8.2Nominees For Beneficial Owners. In the event that any Registrable Securities are held by a nominee for the beneficial owner thereof, the beneficial owner thereof may, at its election, be treated as the holder of such Registrable Securities for purposes of any request or other action by any holder or holders of Registrable Securities pursuant to this Agreement or any determination of any number of percentage of shares of Registrable Securities held by a holder or holders of Registrable Securities contemplated by this Agreement. If the beneficial owner of any Registrable Securities so elects, the Company may require assurances reasonably satisfactory to it of such owner’s beneficial ownership or such Registrable Securities.

8.3Notices. Except as otherwise provided in this Agreement, all notices, requests and other communications to any Person provided for hereunder shall be in writing and shall be given to such Person (a) in the case of a party hereto other than the Company, addressed to such party in the manner set forth in the Preferred Stock Purchase Agreement or at such other address as such party shall have furnished to the Company in writing, or (b) in the case of any other holder of Registrable Securities, at the address that such holder shall have furnished to the Company in writing, or, until any such other holder so furnishes to the Company an address, then to and at the address of the last holder of such Registrable Securities who has furnished an address to the Company, or (c) in the case of the Company, at the address set forth on the signature page hereto, to the attention of its President, or at such other address, or to the attention of such other officer, as the Company shall have furnished to each holder of Registrable Securities at the time outstanding. Each such notice, request or other communication shall be effective (i) if given by mail, 72 hours after such communication is deposited in the mail with first class postage prepaid, addressed as aforesaid or (ii) if given by any other means (including, without limitation, by fax or air courier), when delivered at the address specified above, provided that any such notice, request or communication shall not be effective until received.

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8.4Assignment. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto. In addition, and whether or not any express assignment shall have been made, the provisions of this Agreement which are for the benefit of the parties hereto other than the Company shall also be for the benefit of and enforceable by any subsequent holder of any Registrable Securities. Each of the Holders of the Registrable Securities agrees, by accepting any portion of the Registrable Securities after the date hereof, to the provisions of this Agreement including, without limitation, appointment of the Investors’ Representative to act on behalf of such Holder pursuant to the terms hereof which such actions shall be made in the good faith discretion of the Investors’ Rep resentative and be binding on all persons for all purposes.

8.5Descriptive Headings. The descriptive headings of the several sections and paragraphs of this Agreement are inserted for reference only and shall not limit or otherwise affect the meaning hereof.

8.6Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to applicable principles of conflicts of law.

8.7Jurisdiction. This Agreement shall be exclusively governed by and construed in accordance with the laws of the State of New York. If any action is brought among the parties with respect to this Agreement or otherwise, by way of a claim or counterclaim, the parties agree that in any such action, and on all issues, the parties irrevocably waive their right to a trial by jury. Exclusive jurisdiction and venue for any such action shall be the State or Federal Courts serving the State of New York. In the event suit or action is brought by any party under this Agreement to enforce any of its terms, or in any appeal therefrom, it is agreed that the prevailing party shall be entitled to reasonable attorneys fees to be fixed by the arbitrator, trial court, and/or appellate court.

8.8Entire Agreement. This Agreement embodies the entire agreement and understanding between the Company and each other party hereto relating to the subject matter hereof and supercedes all prior agreements and understandings relating to such subject matter.

8.9Severability. If any provision of this Agreement, or the application of such provisions to any Person or circumstance, shall be held invalid, the remainder of this Agreement, or the application of such provision to Persons or circumstances other than those to which it is held invalid, shall not be affected thereby.

8.10Binding Effect. All the terms and provisions of this Agreement whether so expressed or not, shall be binding upon, inure to the benefit of, and be enforceable by the parties and their respective administrators, executors, legal representatives, heirs, successors and assignees.

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8.11Preparation of Agreement. This Agreement shall not be construed more strongly against any party regardless of who is responsible for its preparation. The parties acknowledge each contributed and is equally responsible for its preparation.

8.12Failure or Indulgence Not Waiver; Remedies Cumulative. No failure or delay on the part of any party hereto in the exercise of any right hereunder shall impair such right or be construed to be a waiver of, or acquiescence in, any breach of any representation, warranty, covenant or agreement herein, nor shall nay single or partial exercise of any such right preclude other or further exercise thereof or of any other right. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any rights or remedies otherwise available.

8.13Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement. A facsimile transmission of this signed Agreement shall be legal and binding on all parties hereto.

[SIGNATURES ON FOLLOWING PAGE]

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IN WITNESS WHEREOF, the Investors and the Company have as of the date first written above executed this Agreement.

IceWEB, Inc.

______________________

By: John R. Signorello

Title: Chief Executive Officer

INVESTOR

BARRON PARTNERS LP

By: Barron Capital Advisors LLC,

General Partner

By: _______________________

Andrew Barron Worden,

Managing Member

730 Fifth Avenue, 9th Floor

New York NY 10019

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EX-10

Exhibit 10.3

FINANCING AGREEMENT

This Financing Agreement (the “Agreement”), dated as of December __, 2005, is entered into by and between IceWeb, Inc., The Seven Corporation, Interlan Communications, Inc., Integrated Power Solutions, Inc. and IceWeb Online, Inc. (individually, a “Client” and collectively, the “Clients”), and Sand Hill Finance, LLC (“SHF”). Under this Agreement, each Client may request for itself that SHF purchase certain Accounts. A Client does not need the consent of, nor notice to, another Client to do so. All of the Clients are, however, jointly and severally liable for the responsibilities of the other Clients, including without limitation the obligations to pay SHF all fees and other amounts set forth in this Agreement.

1. Purchase of Accounts.

1.1Schedule of Accounts. Each Client may request that SHF purchase Accounts by delivering to SHF a Schedule of Accounts (the “Schedule of Accounts”) in the form of Exhibit A, and, if requested by SHF, an invoice for each of the listed Accounts, signed by an authorized representative of Client. SHF is authorized to act upon the written or oral directions of any person that SHF believes is an authorized representative. SHF may, in its sole discretion, elect to purchase any Account included in a Schedule of Accounts, but is under no obligation to purchase any such Account.

1.2Purchased Account; Creation of a Book Reserve. Upon acceptance of any such Account (a “Purchased Account”) SHF shall pay to Client eighty percent (80%) of the face amount of the Purchased Account (the “Advance”). The aggregate outstanding Advances under this Agreement shall not exceed One Million Dollars ($1,000,000) (the “Credit Limit”). Each Client sells, transfers and assigns to SHF, all of Client’s right, title and interest in and to each Purchased Account, together with all of the goods represented by each Purchased Account, all of Client’s rights and remedies as an unpaid Client under applicable law, and all of Client’s rights in and to all security for each such Purchased Account and guaranties thereof, and all rights against third parties with respect thereto. Any goods recovered or received by Client shall be set aside, marked with SHF’s name, and held for SHF’s account as owner. The amount of Purchased Accounts outstanding at any time shall constitute the “Account Balance”. Upon payment of the Advance to Client, SHF shall also create a reserve on SHF’s books and records with respect to each Purchased Account in an amount equal to the face amount of the Purchased Account minus the Advance for such Purchased Account (the “Reserve”). Notwithstanding the foregoing, in no event shall the Reserve with respect to all Purchased Accounts outstanding at any time be less than twenty percent (20%) of the Account Balance. SHF may, in its discretion, change the percentage of the Advance and the Reserve at any time upon notice to Clients.

1.3Collection of Accounts. SHF may directly collect each Purchased Account. At the request of SHF, a Client and SHF shall notify each person liable on a Purchased Account (an “Account Debtor”) by letter in a form acceptable to SHF that Purchased Accounts owed by such Account Debtor have been assigned and are payable to SHF. Client shall not take or permit any action to change or revoke any notification without SHF’s prior written consent and shall not request any Account Debtor to pay any Purchased Account to Client. If Client receives any payments of any Purchased Accounts despite this Agreement, Client shall (i) immediately notify SHF of such payment, (ii) hold such payment in trust and safekeeping for SHF, and (iii) immediately turn over to SHF the identical checks, monies or other forms of payment received, with any necessary endorsement or assignment. SHF shall have the right to endorse Client’s name on all payments received in connection with each Purchased Account and on any other proceeds of Collateral. SHF shall apply payments received first to the Purchased Accounts and, so long as there does not then exist an Event of Default or an event that with notice or lapse of time would constitute an Event of Default, at SHF’s option, SHF shall credit the Reserve or remit to Seller the excess; provided, that if any Event of Default or event that with notice or lapse of time or otherwise would constitute an Event of Default then exists, SHF shall have no duty to remit any such collections, which collections constitute Collateral, and may apply such collections to reduce the Obligations. Client shall indemnify and hold SHF harmless from any expenses, damages and claims arising out of SHF’s collection of any Accounts.

1.4Full Recourse. The purchase by SHF of Purchased Accounts from Client shall be with full recourse against Client. Client shall be liable for any deficiency in the event the Obligations exceed the amount of Purchased Accounts and the other Collateral.

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2. Fees and Customer Payments.

2.1Fees. On the date of this Agreement, and on each anniversary of the date of this Agreement, Clients shall pay SHF a commitment fee equal to one percent (1.0%) of the Credit Limit, half of which is payable on the date hereof and half of which is payable on the date of the first Advance under this Agreement. Clients shall pay to SHF on the last day of each calendar month (the “Settlement Date”), a finance fee (the “Finance Fees”) in an amount equal to two percent (2.0%) per month of the average daily of the all Obligations outstanding during the month ending on such Settlement Date (the “Settlement Period”). Such accrued fees shall be netted against the Reserve as described in Section 3.3. Client shall pay SHF a fee of $40.00 for each check or item of payment that is returned to SHF for insufficient funds and $25.00 for each wire, sent or received. In no event shall any charges that may constitute interest hereunder exceed the highest rate permitted under applicable law. In the event that a court of competent jurisdiction makes a final determination that SHF has received interest hereunder in excess of the maximum lawful rate, then such excess shall be deemed a payment of principal and the interest payable hereunder deemed amended to the amount payable under the maximum lawful rate.

2.2Crediting Customer Payments. Within one business day after SHF’s receipt of payment of a Purchased Account, SHF shall credit that payment (the “Customer Payments”) to the amount outstanding with respect to the Purchased Account, provided that if any Customer Payment is subsequently dishonored or SHF does not receive good funds for any reason, the amount of such uncollected Customer Payment shall be included in the Account Balance as if such Customer Payment had not been received, and Finance Fees shall accrue thereon, and the credit to the specific Purchased Account shall be reversed. Notwithstanding the foregoing, upon the occurrence of an Event of Default, SHF shall apply all Customer Payments to Client’s Obligations under this Agreement in such order and manner as SHF shall, in its sole discretion, determine.

2.3Accounting. SHF shall deliver to Client after each Settlement Date, a statement of Client’s account which shall include an accounting of the transactions for that Settlement Period, including the amount of all Finance Fees, Administrative Fees, Adjustments, Chargeback Amounts, Customer Payments and Purchased Accounts. The accounting shall constitute an account stated and shall be binding on Client and deemed correct unless Client delivers to SHF a written objection within thirty (30) days after such accounting is mailed to Client.

3. Adjustment, Chargebacks and Remittances.

3.1Adjustments. If any Account Debtor asserts any offset, right or claim with respect to a Purchased Account, or pays less than the face amount of such Purchased Account (each, an “Adjustment”), SHF may, in its sole discretion, either (A) deduct the amount of the Adjustment in calculating any amount owed to Client, or (B) chargeback to Client the Purchased Account with respect to which the Adjustment is asserted. Client shall advise SHF immediately upon learning of any Adjustment asserted by any Account Debtor.

3.2	Chargebacks. SHF shall have the right to chargeback to Client any Purchased Account:
	(a)	that remains unpaid ninety (90) calendar days after the invoice date;

(b)           with respect to which there has been a breach of any warranty, representation, covenant or agreement set forth in this Agreement;

(c) with respect to which the Account Debtor asserts any Adjustment, or

(d)           that is owed by an Account Debtor who has filed, or has had filed against it, any bankruptcy case, insolvency proceeding, assignment for the benefit of creditors, receivership or insolvency proceeding, or who has become insolvent (as defined in the United States Bankruptcy Code) or who is generally not paying its debts as such debts become due.

Upon demand by SHF, Client shall pay to SHF the full face amount of any Purchased Account that has been charged back pursuant to this Section, or to the extent partial payment has been made, the amount by which the face amount of such Purchased Account exceeds such partial payment, together with any attorneys’ fees

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and costs incurred by SHF in connection with collecting such Purchased Account (collectively, the “Chargeback Amount”), SHF shall advise Client regarding how the Chargeback Amount shall be paid, which may be by any one or a combination of the following, in SHF’s sole discretion: (1) payment in cash immediately upon demand; (2) deduction from or offset against any Remittance that would otherwise be payable to Client; (3) payment from any Advances that may otherwise be made to Client; (4) adjustment to the Reserve pursuant to Section 1.2 hereof; or (5) delivery of substitute Accounts and a Schedule of Accounts acceptable to SHF, which Accounts shall constitute Purchased Accounts.

3.3Remittance. SHF shall remit to Client after the Settlement Date, the amount, if any, that SHF owes to Client at the end of the Settlement Period based on the following calculations set forth below (the “Remittance”); provided, that if there then exists any Event of Default or any event or condition that with notice or lapse of time would constitute an Event of Default, SHF shall not be obligated to remit any payments to Client. If the amount resulting from the following calculation is a positive number, such amount is the amount of the Remittance for such Settlement Period. If the resulting amount is a negative number, such amount is the amount owed by Client to SHF.

The calculations to be used are as follows:

(a)	The sum of the following:
	(1)	The Reserve as of the beginning of the subject Settlement Period, plus

(2)           The Reserve created for each Account purchased during the subject Settlement Period;

MINUS

(b)	The sum of the following:
	(1)	Finance Fees accrued during the subject Settlement Period; plus
	(2)	Administrative Fees accrued during the subject Settlement Period; plus
	(3)	Adjustments during the subject Settlement Period; plus

(4)           Chargeback Amounts, to the extent SHF has agreed to accept payment of any such Chargeback Amount by deduction from the Remittance: plus

(5)           All professional fees and expenses as set forth in Section 9 for which oral or written demand has been made by SHF during the subject Settlement Period; plus

(6)           The Reserve for the Account Balance as of the first day of the following Settlement Period in the minimum percentage set forth in Section 1.3 hereof.

If the foregoing calculations result in a Remittance payable to Client, SHF shall make such payment by check, subject to SHF’s rights of offset and recoupment, and its right to deduct any Chargeback Amount as set forth in Section 3.2. If the foregoing calculations result in an amount due to SHF from Client, Client shall make such payment by any one or a combination of the methods set forth in Section 3.2 hereof for chargebacks, as determined by SHF in its discretion.

4.Representations and Warranties. Each Client represents to SHF as follows: (a) Client is not in default under any agreement under which Client owes any money, or any agreement, the violation or termination of which could have a material adverse effect on Client; (b) Client has taken all action necessary to authorize the execution, delivery and performance of this Agreement; (c) except for liens approved in writing by SHF, there are no liens, security interests or other encumbrances on the Collateral; (d) the execution and performance of this Agreement do

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not conflict with, or constitute a default under, any agreement to which Client is party or by which Client is bound; (e) the information provided to SHF on or prior to the date of this Agreement is true and correct in all material respects; (f) all financial statements and other information provided to SHF fairly present Client’s financial condition, and there has not been a material adverse change in the financial condition of Client since the date of the most recent of the financial statements submitted to SHF; (g) Client is in compliance with all laws and orders applicable to it; (h) Client is not party to any litigation and is not the subject of any government investigation, and Client has no knowledge of any pending litigation or investigation or the existence of circumstances that reasonably could be expected to give rise to such litigation or investigation, with the exception of the litigation described in Schedule 1 attached; (i) no representation or other statement made by Client to SHF contains any untrue statement of a material fact or omits to state a material fact necessary to make any statements made to SHF not misleading; and (j) each Account described on each Schedule of Accounts is owned by Client, is correctly stated therein, is not in dispute, is unconditionally owing at the time stated in the invoice evidencing such Account as attached to the Schedule of Accounts, is not past due or subject to any offset or in default, represents a bona fide indebtedness arising from the actual sale of goods or performance of services to an Account Debtor in the ordinary course of Client’s business which has been received and finally accepted by the Account Debtor.

5. Covenants.

(a)           Reports. Upon request by SHF, Client will provide to SHF in form and substance acceptable to SHF (i) monthly unaudited financial statements within twenty (20) days after the last day of each month (other than the month in which Client’s fiscal year ends), prepared in accordance with GAAP, consistently applied; (ii) audited fiscal year end financial statements with an unqualified opinion within ninety (90) days after the last day of each fiscal year; and (iii) such other information relating to Client’s operations and condition, as SHF may reasonably request from time to time. SHF shall have the right to review and copy Client’s books and records and audit and inspect the Collateral, from time to time, upon reasonable notice to Client. Client will reimburse SHF for the reasonable costs it may incur from time to time in such inspections and review.

(b)           Insurance. Client will maintain insurance on the Collateral and Client’s business, in amounts and of a type that are customary to businesses similar to Client’s, and SHF will be named in a lender’s loss payable endorsement in favor of SHF, in form reasonably acceptable to SHF.

(c)           Negative Covenants. Without SHF’s prior written consent, Client shall not do any of the following: (i) permit or suffer a change in control of Client or a transfer of more than 20 percent of its securities; (ii) acquire any assets, except in the ordinary course of business or in a transaction involving the payment of an aggregate amount of $100,000 or less; (iii) sell, lease, or transfer any property except for sales of Inventory and Equipment in the ordinary course of business; (iv) transfer, sell or license any intellectual property, except for non-exclusive licenses thereof entered into in the ordinary course of business; (v) pay or declare any dividends on Client’s stock (except for dividends payable solely in stock of Client); (vi) redeem, purchase or otherwise acquire, any of Client’s stock, (vii) permit any Account Debtor to make payments on a Purchased Account other than to SHF; (viii) make any investments in, or loans or advances to, any person other than in the ordinary course of business as currently conducted; (ix) directly or indirectly enter into any material transaction with any affiliate of Client except for transactions that are in the ordinary course of Client’s business, and on fair and reasonable terms that are no less favorable to Client than would be obtained in an arm’s length transaction with a non-affiliated person; (x) make any payment on any indebtedness that is subordinate to the Obligations, other than in accordance with the subordination agreement, if any, in favor of SHF relating thereto; (xi) incur any indebtedness other than trade credit incurred in the ordinary course of business, (xii) permit any lien or security interest to attach to any Collateral other than in favor of SHF, (xiii) fail to make any tax payment on or before the due date; or (xiv) agree to do any of the foregoing.

6.Grant of Security Interest. To secure the prompt payment and performance of all fees, amounts and obligations of each Client now or hereafter owing to SHF under this or any other agreement, involving reasonable attorneys fees, collectively, (the “Obligations”), every Client hereby grants to SHF a security interest in all of Client’s property, now owned or hereafter acquired, including all accounts, inventory, chattel paper, documents, instruments, letters of credit, securities, general intangibles, deposit accounts, patents, trademarks, copyrights, goodwill, inventory, equipment, investment property, financial assets, and all proceeds of the foregoing (collectively, the “Collateral”).

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7.Events of Default; Remedies. Any one or more of the following shall constitute an Event of Default under this Agreement: (a) a Client’s failure (i) to pay all or any part of the principal or interest hereunder on the date due and payable or (ii) to comply with any agreement or covenant set forth in this Agreement, (iii) to comply with the terms of any material contract to which Client is a party and any agreement pursuant to which Client has incurred indebtedness, or (iv) to comply with any law to which a Client is subject; (b) Any of a Client’s assets are attached or become subject to levy or legal proceeding, or if a Client becomes insolvent, or becomes the subject of any case or proceeding under the United States Bankruptcy Code or any other law relating to the reorganization or restructuring of debt (an “Insolvency Event”); or (c) any representation made to SHF in this Agreement, the Schedule of Accounts, the Warrant issued of even date herewith, or any information given to SHF by or on behalf of a Client shall be incorrect in any respect; or (d) the occurrence of a material adverse change in a Client’s condition or prospects. Upon the occurrence of an Event of Default, all fees and other amounts owing hereunder shall, at the option of SHF, be immediately due and payable, and SHF may exercise all of the rights of a secured party under the Uniform Commercial Code. SHF shall have a right to dispose of the Collateral in any commercially reasonable manner, and shall have a royalty-free license to use any name, trademark, advertising matter or any property of a similar nature to complete production of, advertisement for, and disposition of any Collateral. SHF shall have a license to enter into, occupy and use Client’s premises and the Collateral without charge to exercise any of SHF’s rights or remedies under this Agreement. All rights are cumulative and may be exercised in SHF’s discretion singularly or together with any other rights.

8.Power of Attorney. Client appoints SHF and its designees as Client’s true and lawful attorney in fact, to exercise in SHF’s discretion, (1) regardless of whether an Event of Default is then existing, all of the following powers, such powers being coupled, with an interest: (A) to receive, deposit, and endorse Client’s name on all checks, drafts, money orders and other forms of payment relating to the Accounts; (B) to compromise, prosecute, or defend any action, claim, case, or proceeding relating to the Accounts, including the filing of a claim or the voting of such claims in any bankruptcy case, all in SHF’s name or Client’s name, as SHF may elect; (C) to receive, open, redirect and dispose of all mail addressed to Client for the purpose of collecting the Accounts and to take all the actions permitted in subsection (B) above with respect to any payment in any such mail; and (D) to do all acts and things necessary or expedient in furtherance of any such purposes, and (2) after the occurrence of an Event of Default, (E) to notify all Account Debtors to make payment directly to SHF; (F) to demand, collect, receive, sue, and give releases to any Account Debtor for the monies due or which may become due on or in connection with the Accounts; (G)  to sell, assign, transfer, pledge, compromise, or discharge any Accounts; (H) to dispose of any Collateral, and (I) to do all acts and things necessary or expedient, in furtherance of any such purposes.

9.Administrative Expenses and Attorneys’ Fees. Clients shall pay to SHF immediately upon demand, all costs and expenses, including reasonable fees and expenses of attorneys and other professionals, that SHF incurs in connection with any and all of the following: (A) preparing, administering and enforcing this Agreement, or any other agreement executed in connection herewith; (B) perfecting, protecting or enforcing SHF’s interest in the Purchased Accounts and the other Collateral; (C) collecting the Purchased Accounts and the Obligations; (D) defending or in any way addressing claims made or litigation initiated by or against SHF as a result of SHF’s relationship with Client or any guarantor; and (E) representing SHF in connection with any bankruptcy case or insolvency proceeding involving Client, any Purchased Account, any other Collateral or any Account Debtor. Any attorneys’ fees and expenses may, at SHF’s option, be netted against the reserve as set forth in Section 3.3.

10.Term and Termination. The term of this Agreement shall be for one (1) year from the date hereof, and from year to year thereafter unless terminated in writing by SHF or Client. Clients and SHF shall each have the right to terminate this Agreement at any time. Notwithstanding the foregoing, any termination of this Agreement shall not affect SHF’s security interest in the Collateral and SHF’s ownership of the Purchased Accounts, and this Agreement shall continue to be effective, and SHF’s rights and remedies hereunder shall survive such termination, until all transactions entered into and Obligations incurred hereunder or in connection herewith have been completed and satisfied in full.

11. Miscellaneous.

11.1Co-Obligors. Each of the Clients is jointly and severally liable for the obligations of all the other Clients under this Agreement, as amended from time to time. Each Client appoints each other Client to give and receive notices, reports and requests on its behalf, and SHF shall have no duty to inquire as to the authority of one

5

Client to bind the other Clients. Each Client authorizes SHF to proceed against one or more Clients without proceeding against another, and SHF shall have no duty to exercise any remedies against any Client. No Client shall have a right of reimbursement or subrogation as against another Client until all obligations owing to SHF have been satisfied in full. Each Client waives the benefits of California Civil Code sections 2809, 2810, 2819, 2845, 2847, 2848, 2849, 2850, 2899 and 3433.

11.2Severability. In the event that any provision of this Agreement is held to be invalid or unenforceable, this Agreement will be construed as not containing such provision and the remainder of the Agreement shall remain in full force and effect.

11.3Choice of Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of California, without giving effect to principles of conflicts of law. Unless otherwise defined, capitalized terms shall have the meaning assigned in the Uniform Commercial Code.

11.4Notices. All notices shall be given to SHF and Client at the addresses set forth in this Agreement and shall be deemed to have been delivered and received: (A) if mailed, three (3) calendar days after deposited in the United States mail, first class, postage prepaid; (B) one (1) calendar day after deposit with an overnight mail or messenger service; or (C) on the same date of transmission if sent by hand delivery or fax.

11.5Jury Waiver; Arbitration; Jurisdiction. SHF AND EACH CLIENT IRREVOCABLY WAIVE ANY RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, INCLUDING CONTRACT CLAIMS, TORT CLAIMS AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. IF THIS JURY WAIVER IS FOR ANY REASON NOT ENFORCEABLE, THEN SHF AND CLIENT AGREE TO RESOLVE AL CLAIMS, CAUSES AND DISPUTES THROUGH FINAL AND BINDING ARBITRATION TO BE HELD IN SANTA CLARA COUNTY, CALIFORNIA IN ACCORDANCE WITH THE THEN-CURRENT COMMERCIAL ARBITRATION RULES OF THE AMERICAN ARBITRATION ASSOCIATION. JUDGMENT UPON ANY AWARD RESULTING FROM ARBITRATION MAY BE ENTERED INTO AND ENFORCED BY ANY STATE OR FEDERAL COURT HAVING JURISDICTION THEREOF. SHF and each Client submit to the jurisdiction of the state and Federal courts located in Santa Clara County, California.

11.6Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which shall constitute one instrument.

11.7Integration. This Agreement and the documents executed in connection herewith constitute the entire agreement of the parties, and supercedes any prior discussions or agreements, oral or written. This Agreement may not be amended except by written instrument signed by both parties. No waiver shall be effective unless in writing and signed by SHF. Any waiver on one occasion is not a waiver on any subsequent occasion

11.8Assignment. No Client may assign any interests or rights, or delegate any duties, hereunder. SHF may grant participations in, assign its rights, and grant one or more security interests, in its rights hereunder.

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IN WITNESS WHEREOF, Client and SHF have executed this Agreement on the day and year written above.

“SHF”	“CLIENT”
SAND HILL FINANCE, LLC	ICEWEB, INC.
By: _____________________________________	By: ___________________________________
Title: _____________________________________	Title: ___________________________________
3000 Sand Hill Road, Building 1, Suite 240	THE SEVEN CORPORATION
Menlo Park, CA 94025
Telephone No: (650) 926-7019	By: ___________________________________
Facsimile No: (650) 926-7018
	Title: ___________________________________
	INTERLAN COMMUNICATIONS, INC.
	By: ___________________________________
	Title: ___________________________________
	INTEGRATED POWER SOLUTIONS, INC.
	By: ___________________________________
	Title: ___________________________________
	ICEWEB ONLINE, INC.
	By: ___________________________________
	Title: ___________________________________
	Address for each Client
	205 Van Buren Street, Suite 420
	Herndon, VA 20170
	Telephone No.:
	Facsimile No.:
	Other Locations of Collateral, if any, in Addition to the Above:
	__________________________________________
	__________________________________________
	__________________________________________
	__________________________________________
	__________________________________________
	__________________________________________
	__________________________________________
	__________________________________________
	__________________________________________
	__________________________________________

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.

Schedule # ______

EXHIBIT A

SCHEDULE OF ACCOUNTS

CLIENT: DATE: ________________

	Invoice Date	Invoice Number	Account Debtor Information (Print or Type)	Purchase Order #	Invoice Amount
1
2
3
4
5
6
7
8
9
10
11
12
13
The Client named above, hereby delivers this Schedule of Accounts to Sand Hill Finance, LLC, (“SHF”) pursuant to a Financing Agreement between SHF and Client. The undersigned represents that he or she is authorized representative of Client with full right, power and authority to deliver this Schedule of Accounts to SHF. The Accounts evidenced by the invoices on this Schedule of Accounts are submitted for purchase under the terms and conditions of the Financing Agreement now in force. THE UNDERSIGNED ATTESTS THAT THESE INVOICES REPRESENT ACTUAL SALES AND THAT SHIPMENT/DELIVERY OF GOODS AND /OR COMPLETION OF SERVICES HAVE BEEN MADE. The undersigned further attests that all of the representations and warranties in Section 4 of the Financing Agreement are true and correct with respect to each of the Accounts and Account Debtors described on this Schedule of Accounts.				Total
				Less Reserve
				Other Adjustments:
				Net Advance
				Check#	Check Date

Disbursement Instructions:

Authorized Signature:____________________________________________________

Print Name:_____________________________________________________________

Please fax to 408-447-8535

RESOLUTIONS TO BORROW

Client: IceWeb, Inc.

I, the undersigned officer of IceWeb, Inc. (“Client”), HEREBY CERTIFY that Client is a corporation organized and existing under and by virtue of the laws of the state of Delaware.

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and complete copies of Client’s Certificate of Incorporation and Bylaws, each of which is in full force and effect on the date hereof.

I FURTHER CERTIFY that by unanimous written consent of the directors of Client, (or by other duly authorized action in lieu of a meeting), the following resolutions were adopted.

BE IT RESOLVED, that any one (1) of the following named officers, partners, members, employees, or agents, whose actual signatures are shown below:

NAMES POSITIONS ACTUAL SIGNATURES

acting for and on behalf of this entity and as its act and deed be, and they hereby are, authorized and empowered:

Obtain Credit. To sell accounts to, and obtain credit from time to time from, Sand Hill Finance, LLC (“SHF”) on such terms as may be agreed upon between the officers, employees, or agents and SHF, as in their judgment should be obtained, without limitation, including such sums as are specified in one or more financing or factoring agreements between SHF and Client.

Execute Agreement. To execute and deliver on behalf of Client one or more agreements relating to the extension of credit, and also one or more renewals, extensions, modifications, refinancings, consolidations, or substitutions for one or more of the notes, or any portion of the notes.

Grant Security. To grant a security interest to SHF in the property of Client to secure all of the Client’s obligations to SHF.

Issue Warrants. To issue to SHF warrants to purchase Client’s equity securities.

Further Acts. To designate additional or alternate individuals as being authorized to request advances thereunder, and in all cases, to do and perform such other acts and things, to pay any and all fees and costs, and to execute and deliver such other documents and agreements as they may in their discretion deem reasonably necessary or proper in order to carry into effect the provisions of these Resolutions.

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these resolutions and performed prior to the passage of these resolutions are hereby ratified and approved, that these Resolutions shall remain in full force and effect and SHF may rely on these Resolutions until written notice of their revocation shall have been delivered to and received by SHF. Any such notice shall not affect any of the Client’s agreements or commitments in effect at the time notice is given.

I FURTHER CERTIFY that the officers, employees, and agents named above are duly elected, appointed, or employed by or for Client, as the case may be, and occupy the positions set forth opposite their respective names; that the foregoing Resolutions now stand of record on the books of the Client; and that the Resolutions are in full force and effect and have not been modified or revoked in any manner whatsoever.

IN WITNESS WHEREOF, I have hereunto set my hand on December __, 2005 and attest that the signatures set opposite the names listed above are their genuine signatures.

CERTIFIED TO AND ATTESTED BY:

X _____________________________________

Attachment 1 – Certificate of Incorporation

Attachment 2 - Bylaws

RESOLUTIONS TO BORROW

Client: The Seven Corporation

I, the undersigned officer of The Seven Corporation (“Client”), HEREBY CERTIFY that Client is a corporation organized and existing under and by virtue of the laws of the state of Virginia.

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and complete copies of Client’s Articles of Incorporation and Bylaws, each of which is in full force and effect on the date hereof.

I FURTHER CERTIFY that by unanimous written consent of the directors of Client, (or by other duly authorized action in lieu of a meeting), the following resolutions were adopted.

BE IT RESOLVED, that any one (1) of the following named officers, partners, members, employees, or agents, whose actual signatures are shown below:

NAMES POSITIONS ACTUAL SIGNATURES

acting for and on behalf of this entity and as its act and deed be, and they hereby are, authorized and empowered:

Obtain Credit. To sell accounts to, and obtain credit from time to time from, Sand Hill Finance, LLC (“SHF”) on such terms as may be agreed upon between the officers, employees, or agents and SHF, as in their judgment should be obtained, without limitation, including such sums as are specified in one or more financing or factoring agreements between SHF and Client.

Execute Agreement. To execute and deliver on behalf of Client one or more agreements relating to the extension of credit, and also one or more renewals, extensions, modifications, refinancings, consolidations, or substitutions for one or more of the notes, or any portion of the notes.

Grant Security. To grant a security interest to SHF in the property of Client to secure all of the Client’s obligations to SHF.

Issue Warrants. To issue to SHF warrants to purchase Client’s equity securities.

Further Acts. To designate additional or alternate individuals as being authorized to request advances thereunder, and in all cases, to do and perform such other acts and things, to pay any and all fees and costs, and to execute and deliver such other documents and agreements as they may in their discretion deem reasonably necessary or proper in order to carry into effect the provisions of these Resolutions.

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these resolutions and performed prior to the passage of these resolutions are hereby ratified and approved, that these Resolutions shall remain in full force and effect and SHF may rely on these Resolutions until written notice of their revocation shall have been delivered to and received by SHF. Any such notice shall not affect any of the Client’s agreements or commitments in effect at the time notice is given.

I FURTHER CERTIFY that the officers, employees, and agents named above are duly elected, appointed, or employed by or for Client, as the case may be, and occupy the positions set forth opposite their respective names; that the foregoing Resolutions now stand of record on the books of the Client; and that the Resolutions are in full force and effect and have not been modified or revoked in any manner whatsoever.

IN WITNESS WHEREOF, I have hereunto set my hand on December __, 2005 and attest that the signatures set opposite the names listed above are their genuine signatures.

CERTIFIED TO AND ATTESTED BY:

X _____________________________________

Attachment 1 – Articles of Incorporation

Attachment 2 - Bylaws

RESOLUTIONS TO BORROW

Client: Interlan Communications, Inc.

I, the undersigned officer of Interlan Communications, Inc. (“Client”), HEREBY CERTIFY that Client is a corporation organized and existing under and by virtue of the laws of the state of Virginia.

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and complete copies of Client’s Articles of Incorporation and Bylaws, each of which is in full force and effect on the date hereof.

I FURTHER CERTIFY that by unanimous written consent of the directors of Client, (or by other duly authorized action in lieu of a meeting), the following resolutions were adopted.

BE IT RESOLVED, that any one (1) of the following named officers, partners, members, employees, or agents, whose actual signatures are shown below:

NAMES POSITIONS ACTUAL SIGNATURES

acting for and on behalf of this entity and as its act and deed be, and they hereby are, authorized and empowered:

Obtain Credit. To sell accounts to, and obtain credit from time to time from, Sand Hill Finance, LLC (“SHF”) on such terms as may be agreed upon between the officers, employees, or agents and SHF, as in their judgment should be obtained, without limitation, including such sums as are specified in one or more financing or factoring agreements between SHF and Client.

Execute Agreement. To execute and deliver on behalf of Client one or more agreements relating to the extension of credit, and also one or more renewals, extensions, modifications, refinancings, consolidations, or substitutions for one or more of the notes, or any portion of the notes.

Grant Security. To grant a security interest to SHF in the property of Client to secure all of the Client’s obligations to SHF.

Issue Warrants. To issue to SHF warrants to purchase Client’s equity securities.

Further Acts. To designate additional or alternate individuals as being authorized to request advances thereunder, and in all cases, to do and perform such other acts and things, to pay any and all fees and costs, and to execute and deliver such other documents and agreements as they may in their discretion deem reasonably necessary or proper in order to carry into effect the provisions of these Resolutions.

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these resolutions and performed prior to the passage of these resolutions are hereby ratified and approved, that these Resolutions shall remain in full force and effect and SHF may rely on these Resolutions until written notice of their revocation shall have been delivered to and received by SHF. Any such notice shall not affect any of the Client’s agreements or commitments in effect at the time notice is given.

I FURTHER CERTIFY that the officers, employees, and agents named above are duly elected, appointed, or employed by or for Client, as the case may be, and occupy the positions set forth opposite their respective names; that the foregoing Resolutions now stand of record on the books of the Client; and that the Resolutions are in full force and effect and have not been modified or revoked in any manner whatsoever.

IN WITNESS WHEREOF, I have hereunto set my hand on December __, 2005 and attest that the signatures set opposite the names listed above are their genuine signatures.

CERTIFIED TO AND ATTESTED BY:

X _____________________________________

Attachment 1 – Articles of Incorporation

Attachment 2 - Bylaws

RESOLUTIONS TO BORROW

Client: Integrated Power Solutions, Inc.

I, the undersigned officer of Integrated Power Solutions, Inc. (“Client”), HEREBY CERTIFY that Client is a corporation organized and existing under and by virtue of the laws of the state of Virginia.

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and complete copies of Client’s Articles of Incorporation and Bylaws, each of which is in full force and effect on the date hereof.

I FURTHER CERTIFY that by unanimous written consent of the directors of Client, (or by other duly authorized action in lieu of a meeting), the following resolutions were adopted.

BE IT RESOLVED, that any one (1) of the following named officers, partners, members, employees, or agents, whose actual signatures are shown below:

NAMES POSITIONS ACTUAL SIGNATURES

acting for and on behalf of this entity and as its act and deed be, and they hereby are, authorized and empowered:

Obtain Credit. To sell accounts to, and obtain credit from time to time from, Sand Hill Finance, LLC (“SHF”) on such terms as may be agreed upon between the officers, employees, or agents and SHF, as in their judgment should be obtained, without limitation, including such sums as are specified in one or more financing or factoring agreements between SHF and Client.

Execute Agreement. To execute and deliver on behalf of Client one or more agreements relating to the extension of credit, and also one or more renewals, extensions, modifications, refinancings, consolidations, or substitutions for one or more of the notes, or any portion of the notes.

Grant Security. To grant a security interest to SHF in the property of Client to secure all of the Client’s obligations to SHF.

Issue Warrants. To issue to SHF warrants to purchase Client’s equity securities.

Further Acts. To designate additional or alternate individuals as being authorized to request advances thereunder, and in all cases, to do and perform such other acts and things, to pay any and all fees and costs, and to execute and deliver such other documents and agreements as they may in their discretion deem reasonably necessary or proper in order to carry into effect the provisions of these Resolutions.

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these resolutions and performed prior to the passage of these resolutions are hereby ratified and approved, that these Resolutions shall remain in full force and effect and SHF may rely on these Resolutions until written notice of their revocation shall have been delivered to and received by SHF. Any such notice shall not affect any of the Client’s agreements or commitments in effect at the time notice is given.

I FURTHER CERTIFY that the officers, employees, and agents named above are duly elected, appointed, or employed by or for Client, as the case may be, and occupy the positions set forth opposite their respective names; that the foregoing Resolutions now stand of record on the books of the Client; and that the Resolutions are in full force and effect and have not been modified or revoked in any manner whatsoever.

IN WITNESS WHEREOF, I have hereunto set my hand on December __, 2005 and attest that the signatures set opposite the names listed above are their genuine signatures.

CERTIFIED TO AND ATTESTED BY:

X _____________________________________

Attachment 1 – Articles of Incorporation

Attachment 2 - Bylaws

RESOLUTIONS TO BORROW

Client: IceWeb Online, Inc.

I, the undersigned officer of IceWeb Online, Inc. (“Client”), HEREBY CERTIFY that Client is a corporation organized and existing under and by virtue of the laws of the state of Virginia.

I FURTHER CERTIFY that attached hereto as Attachments 1 and 2 are true and complete copies of Client’s Articles of Incorporation and Bylaws, each of which is in full force and effect on the date hereof.

I FURTHER CERTIFY that by unanimous written consent of the directors of Client, (or by other duly authorized action in lieu of a meeting), the following resolutions were adopted.

BE IT RESOLVED, that any one (1) of the following named officers, partners, members, employees, or agents, whose actual signatures are shown below:

NAMES POSITIONS ACTUAL SIGNATURES

acting for and on behalf of this entity and as its act and deed be, and they hereby are, authorized and empowered:

Obtain Credit. To sell accounts to, and obtain credit from time to time from, Sand Hill Finance, LLC (“SHF”) on such terms as may be agreed upon between the officers, employees, or agents and SHF, as in their judgment should be obtained, without limitation, including such sums as are specified in one or more financing or factoring agreements between SHF and Client.

Execute Agreement. To execute and deliver on behalf of Client one or more agreements relating to the extension of credit, and also one or more renewals, extensions, modifications, refinancings, consolidations, or substitutions for one or more of the notes, or any portion of the notes.

Grant Security. To grant a security interest to SHF in the property of Client to secure all of the Client’s obligations to SHF.

Issue Warrants. To issue to SHF warrants to purchase Client’s equity securities.

Further Acts. To designate additional or alternate individuals as being authorized to request advances thereunder, and in all cases, to do and perform such other acts and things, to pay any and all fees and costs, and to execute and deliver such other documents and agreements as they may in their discretion deem reasonably necessary or proper in order to carry into effect the provisions of these Resolutions.

BE IT FURTHER RESOLVED, that any and all acts authorized pursuant to these resolutions and performed prior to the passage of these resolutions are hereby ratified and approved, that these Resolutions shall remain in full force and effect and SHF may rely on these Resolutions until written notice of their revocation shall have been delivered to and received by SHF. Any such notice shall not affect any of the Client’s agreements or commitments in effect at the time notice is given.

I FURTHER CERTIFY that the officers, employees, and agents named above are duly elected, appointed, or employed by or for Client, as the case may be, and occupy the positions set forth opposite their respective names; that the foregoing Resolutions now stand of record on the books of the Client; and that the Resolutions are in full force and effect and have not been modified or revoked in any manner whatsoever.

IN WITNESS WHEREOF, I have hereunto set my hand on December __, 2005 and attest that the signatures set opposite the names listed above are their genuine signatures.

CERTIFIED TO AND ATTESTED BY:

X _____________________________________

Attachment 1 – Articles of Incorporation

Attachment 2 – Bylaws

SCHEDULE 1

There is presently pending in the Circuit Court of Fairfax County, Virginia two (2) Motions for Judgment, captioned Bonnie Edenfield vs. Iceweb, Inc., et al, Chancery No. CH 2005 4303; and Christopher Macdonald vs. Iceweb, Inc., et al, Chancery No. CH 2005 4304. Both of these suits are considered by Iceweb, Inc. to be entirely devoid of merit. Edenfield and Macdonald were shareholders in Develements, Inc., a corporation the assets of which were previously acquired by Iceweb, Inc. The asset purchase agreement contained certain provisions whereby Iceweb, Inc. would pay shareholders of Develements, Inc. certain sums and issue certain common stock and stock options in connection with the asset acquisition. Substantial sums, in excess of $200,000.00, have already been paid to or for a number of shareholders. Recently, Iceweb, Inc. concluded that Develements grossly misrepresented its condition, including its assets, liabilities, and work in progress, when it was acquired. Additionally, Macdonald committed certain statutory and tortious wrongs against Iceweb, Inc, and breaches of fiduciary duty, and Edenfield breached fiduciary duties to Iceweb, Inc. As a result of these determinations, the employment of substantially all former Develements employees who were provided employment positions with Iceweb, Inc. or one of its subsidiaries, was terminated. Based on the wrongs committed by Develements and by its shareholders, a decision was taken to suspend any further payments to former Develements shareholders and to seek damages from these former Develements shareholders. The entire transaction with Develements may be unwound through a request for rescission of the asset purchase agreement.

This litigation is being defended vigorously. Following the filing of numerous aggressive defensive pleadings by Iceweb, Inc., counsel for Edenfield and Macdonald has asked that the matter be settled as to each of the two plaintiffs in the tens of thousands of dollars. Iceweb has rejected the settlement offers. There is some question whether these plaintiffs have the financial wherewithal to continue prosecuting these cases. At this time, in order to move the cases forward, counsel for Edenfield and Macdonald will have to set a number of motions, demurrers and pleas down for hearing, which will involve the filing of complex briefing papers, at considerable expense to the plaintiffs. Iceweb, Inc. questions whether these plaintiffs will even proceed.

This litigation has no effect whatsoever on the collateral security to be posted in favor of Sand Hill Finance, LLC. These suits primarily seek money damages from Iceweb, Inc. The plaintiffs, in the worst case, are entirely unsecured general creditors of Iceweb, Inc., whose claims are contested and offset by claims by Iceweb, Inc. against these defendants. Iceweb, Inc. will continue to vigorously defend these cases.

EX-99

Exhibit 99.1

.

January 26, 2006 08:56 AM US Eastern Timezone

IceWEB Announces Live Online Support for IceMAIL and IceVISTA

HERNDON, Va.--(BUSINESS WIRE)--IceWEB, Inc. (OTCBB:IWEB) today announced they have added a live online support feature for both IceMAIL and IceVISTA products. Customer’s can access live online support by going to www.iceweb.com and clicking on “Support”. Once at the support site, the customer can select either IceMAIL or IceVISTA to get instant access to IceWEB’s customer service personnel.

In 2005 IceWEB released two new products, IceWEB VISTA, a web portal development and management application and IceMAIL, an enterprise hosted exchange service. Both products are designed for the small to medium business market (SME) that can work in tandem to give the small business an edge in their marketplace.

“Live Online Support is yet another great feature we’ve put in place to provide the best customer service in the industry,” stated James Bond, Chief Technology Officer (CTO) for IceWEB. “Keeping our customers informed and providing superior online documentation, telephone support, and now online chat support are critical to customer satisfaction and our goal of 100% customer retention.”

To be added to our investor relations email list please go to: http://www.iceweb.com/InvestorRelations/EmailAlerts/tabid/135/Default. aspx (Due to its length, this URL may need to be copied/pasted into your Internet browser’s address field. Remove the extra space if one exists.) or call investor relations at 703-964-8000 ext 0961.

About IceWEB

IceWEB, Inc. (OTCBB:IWEB), enables small and medium sized organizations with its, hardware, software and professional services. The Company’s application service provider (ASP) software delivery model reduces the customer’s Total Cost of Ownership and improves the efficiency of IT environments. IceWEB packaged solutions and uniquely tailored services ensure business value in the Small and Medium Size business environment. Founded in 2000, ICEWEB is headquartered in Herndon, V.A., and serves customers in the public and private sectors. IceWEB(TM) products and services are available on GSA Contract # GS-35F-5149H. For more information, please visit http://www.IceWEB.com.

“Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties, including but not limited to business conditions and the amount of growth in the computer industry and general economy, competitive factors, and other risks detailed from time to time in the Company’s SEC reports, including but not limited to its annual report on Form 10-K and its quarterly reports on Forms 10-Q. The Company does not undertake any obligation to update forward-looking statements.

All trademarks and brand names are the property of their respective companies.

Contacts

IceWEB, Inc.

My Le Phuong, 703-964-8000 ext 0961

investor@IceWEB.com