COLLATERAL ASSIGNMENT
                              ---------------------

     I/OMagic  Corporation  ("Borrower"),  on  March  9,  2005,  hereby grants a
security interest in and collaterally assigns to GMAC Commercial Finance LLC all
of  its right, title and interest in and security interests and liens arising as
a  result  of,  the  following:

1.     Agreement dated February 20, 2003 between Borrower and IOM Holdings, Inc.
("IOM");

2.     Secured  Promissory  Note  dated  March __ 2003 (sic.) executed by IOM in
favor  of  Borrower  in  the  original  principal  amount  of  $1,000,000;

3.     Security  Agreement  dated  March  19, 2003 between Borrower and IOM; and

4.     All UCC financing statements filed with the Nevada Secretary of State and
recordings  in the U.S. Patent and Trademark Office ("USPTO") in connection with
the  above.

Borrower hereby grants Lender a power of attorney to prepare, sign on Borrower's
behalf and file any UCC assignments and USPTO assignments and related documents
Lender deems appropriate to secure the rights being granted and assigned
hereunder.

     This  Collateral  Assignment and Lender's rights hereunder shall be subject
to  the terms of the Loan and Security Agreement of even date between Lender and
Borrower.

                              I/OMAGIC  CORPORATION
                              By: /s/ Tony Shahbaz
                              Tony  Shahbaz,  President