SECURITIES PURCHASE AGREEMENT




                          DATED AS OF FEBRUARY 18, 2004




                                  BY AND AMONG




                               SWISS MEDICA, INC.



                                       AND



                       THE PURCHASERS LISTED ON EXHIBIT A



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                                TABLE OF CONTENTS

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SECURITIES PURCHASE AGREEMENT..................................................1

ARTICLE I Purchase and Sale of Common Stock and Warrants.......................1
      Section 1.1   Purchase and Sale of Common Stock and
                    Warrants...................................................1
      Section 1.2   Purchase Price and Closing.................................1

ARTICLE II Representations and Warranties......................................2
      Section 2.1   Representations and Warranties of the Company..............2
      Section 2.2   Representations and Warranties of the Purchasers..........12

ARTICLE III Covenants.........................................................15
      Section 3.1   Securities Compliance.....................................15
      Section 3.2   Registration and Listing..................................15
      Section 3.3   Inspection Rights.........................................15
      Section 3.4   Compliance with Laws......................................16
      Section 3.5   Keeping of Records and Books of Account...................16
      Section 3.6   Reporting Requirements.  .................................16
      Section 3.7   Other Agreements..........................................16
      Section 3.8   Subsequent Financings; Right of First Refusal.............16
      Section 3.9   Use of Proceeds...........................................17
      Section 3.10  Reporting Status; Eligibility to Use Form SB-2............17
      Section 3.11  Disclosure of Transaction.................................18
      Section 3.12  Disclosure of Material Information........................18
      Section 3.13  Pledge of Securities.  ...................................18

ARTICLE IV Conditions.........................................................18
      Section 4.1   Conditions Precedent to the Obligation of the Company
                    to Close and to Sell the Securities.......................18
      Section 4.2   Conditions Precedent to the Obligation of the Purchasers
                    to Close and to Purchase the Securities...................19

ARTICLE V Certificate Legend..................................................20
      Section 5.1   Legend....................................................20

ARTICLE VI Indemnification....................................................21
      Section 6.1   General Indemnity.........................................21
      Section 6.2   Indemnification Procedure.................................22

ARTICLE VII Miscellaneous.....................................................23
      Section 7.1   Fees and Expenses.........................................23
      Section 7.2   Specific Performance; Consent to Jurisdiction; Venue......23
      Section 7.3   Entire Agreement; Amendment...............................23
      Section 7.4   Notices...................................................24
      Section 7.5   Waivers...................................................25
      Section 7.6   Headings..................................................25
      Section 7.7   Successors and Assigns....................................25

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                                TABLE OF CONTENTS
                                   (continued)
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      Section 7.8   No Third Party Beneficiaries..............................25
      Section 7.9   Governing Law.............................................25
      Section 7.10  Survival..................................................25
      Section 7.11  Counterparts..............................................25
      Section 7.12  Publicity.................................................25
      Section 7.13  Severability..............................................25
      Section 7.14  Further Assurances........................................26

ACCREDITED INVESTOR CERTIFICATION.............................................iv

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                         SECURITIES PURCHASE AGREEMENT


      This  SECURITIES  PURCHASE  AGREEMENT  this  ("Agreement"),  dated  as  of
February 18, 2004 by and between Swiss Medica, Inc., a Delaware corporation (the
"Company"),  and the  purchasers  listed on Exhibit A and  executing a signature
page hereto (each a "Purchaser" and  collectively,  the  "Purchasers"),  for the
purchase and sale of shares of the  Company's  class A common  stock,  par value
$.001 per share (the "Common Stock") and a warrant, in substantially the form of
Exhibit B hereto (the  "Warrant"),  to purchase  shares of Common Stock,  by the
Purchasers.

      The parties hereto agree as follows:

                                   ARTICLE I

                 PURCHASE AND SALE OF COMMON STOCK AND WARRANTS

            Section 1.1.Purchase and Sale of Common Stock and Warrants.

            (a) Upon the following terms and conditions, the Company shall issue
and sell to the Purchasers,  and the Purchasers shall purchase from the Company,
an aggregate of 3,000,000  shares of Common Stock (the  "Shares") at a price per
share of $0.10 cents (the "Per Share Purchase Price") for an aggregate  purchase
price of $300,000 (the  "Purchase  Price").  The Company and the  Purchasers are
executing and delivering  this Agreement in accordance with and in reliance upon
the exemption from securities  registration afforded by Section 4(2) of the U.S.
Securities Act of 1933, as amended,  and the rules and  regulations  promulgated
thereunder (the  "Securities  Act"),  including  Regulation D ("Regulation  D"),
and/or  upon such other  exemption  from the  registration  requirements  of the
Securities Act as may be available with respect to any or all of the investments
to be made hereunder.

            (b) Upon the following terms and conditions, the Purchasers shall be
issued Warrants, to purchase an aggregate of 3,000,000 shares of Common Stock as
set forth opposite such Purchaser's name on Exhibit A hereto. The Warrants shall
have an  initial  exercise  price  equal to $0.25  cents  per share and shall be
exercisable  commencing  the Closing Date through and including the two (2) year
anniversary  of the  Closing  Date.  Any shares of Common  Stock  issuable  upon
exercise of the Warrants (and such shares when issued) are herein referred to as
the  "Warrant  Shares".  The Shares,  the  Warrants  and the Warrant  Shares are
sometimes collectively referred to herein as the "Securities".

            Section  1.2.Purchase Price and Closing. The Company agrees to issue
and sell to the Purchasers and, in consideration of and in express reliance upon
the  representations,  warranties,  covenants,  terms  and  conditions  of  this
Agreement,  the  Purchasers,  severally  but not jointly,  agree to purchase the
number of Shares and Warrants, in each case, set forth opposite their respective
names on  Exhibit  A. The  closing  of the  purchase  and sale of the Shares and
Warrants to be acquired by the Purchasers  from the Company under this Agreement
shall take place at the offices of Jenkens & Gilchrist  Parker  Chapin LLP,  The
Chrysler  Building,  405  Lexington  Avenue,  New  York,  New  York  10174  (the

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"Closing")  at 10:00 a.m.,  New York time (i) on or before  February  18,  2004,
provided,  that  all of the  conditions  set  forth in  Article  IV  hereof  and
applicable  to the Closing  shall have been  fulfilled  or waived in  accordance
herewith, or (ii) at such other time and place or on such date as the Purchasers
and the Company may agree upon (the "Closing Date"). At the Closing, the Company
shall  deliver or cause to be  delivered  to each  Purchaser  (i) a  certificate
registered in the name of the Purchaser  representing the number of Shares as is
set  forth  opposite  the  name  of  such  Purchaser  on  Exhibit  A and  (ii) a
certificate  representing  a Warrant to purchase such number of shares of Common
Stock as is set forth  opposite the name of such  Purchaser on Exhibit A. At the
Closing,  each Purchaser shall deliver its Purchase Price by wire transfer to an
account designated by the Company.

                                   ARTICLE II

                         REPRESENTATIONS AND WARRANTIES

            Section  2.1.Representations  and  Warranties  of the  Company.  The
Company hereby represents and warrants to each of the Purchasers as follows,  as
of the date hereof and the Closing Date,  except as set forth on the Schedule of
Exceptions  attached  hereto with each numbered  Schedule  corresponding  to the
section number herein:

            (a)  Organization,  Good  Standing  and  Power.  The  Company  is  a
corporation duly  incorporated,  validly existing and in good standing under the
laws of the State of  Delaware  and has the  requisite  corporate  power to own,
lease and operate its properties and assets and to conduct its business as it is
now being  conducted.  The Company does not have any Subsidiaries (as defined in
Section  2.1(g)) or own securities of any kind in any other entity except as set
forth on  Schedule  2.1(g)  hereto.  The Company  and each such  Subsidiary  (as
defined in Section  2.1(g)) is duly  qualified  as a foreign  corporation  to do
business and is in good  standing in every  jurisdiction  in which the nature of
the  business  conducted  or  property  owned  by it  makes  such  qualification
necessary  except for any  jurisdiction(s)  (alone or in the aggregate) in which
the failure to be so qualified will not have a Material Adverse Effect.  For the
purposes of this  Agreement,  "Material  Adverse Effect" means any effect on the
business,  operations,  properties,  prospects  or  financial  condition  of the
Company that is material and adverse to the Company and its Subsidiaries,  taken
as a whole, and any condition, circumstance or situation that would prohibit the
Company from entering into and performing any of its  obligations  hereunder and
under the other Transaction Documents (as defined below).

            (b)  Authorization;  Enforcement.  The  Company  has  the  requisite
corporate  power and  authority  to enter into and perform this  Agreement,  the
Warrants and that certain Registration Rights Agreement by and among the Company
and the Purchasers,  dated as of the date hereof,  substantially  in the form of
Exhibit C attached hereto (the  "Registration  Rights  Agreement" and,  together
with this Agreement and the Warrants, the "Transaction  Documents") and to issue
and sell the  Securities in accordance  with the terms  hereof.  The  execution,
delivery and  performance  of the  Transaction  Documents by the Company and the
consummation by it of the transactions  contemplated  thereby have been duly and
validly authorized by all necessary  corporate action,  and, except as set forth
on Schedule  2.1(b),  no further consent or  authorization  of the Company,  its
Board of Directors or stockholders  is required.  When executed and delivered by

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the Company,  each of the  Transaction  Documents  shall  constitute a valid and
binding obligation of the Company  enforceable against the Company in accordance
with its terms,  except as such  enforceability  may be  limited  by  applicable
bankruptcy,    reorganization,    moratorium,   liquidation,    conservatorship,
receivership or similar laws relating to, or affecting generally the enforcement
of, creditor's  rights and remedies or by other equitable  principles of general
application.

            (c)  Capitalization.  The authorized capital stock of the Company as
of the date of this Agreement  consists of 100,000,000  shares of Class A Common
Stock, of which  28,892,982 were issued and outstanding as of February 17, 2004,
and 2,000,000  shares of Class B Common Stock,  par value $.001 per share,  were
issued and outstanding as of February 17, 2004. All of the outstanding shares of
the Common  Stock and any other  outstanding  security of the Company  have been
duly and validly  authorized.  Except as set forth in this  Agreement and as set
forth on Schedule 2.1(c) hereto, no shares of Common Stock or any other security
of the Company are  entitled to  preemptive  rights or  registration  rights and
there are no outstanding options,  warrants, scrip, rights to subscribe to, call
or commitments of any character  whatsoever relating to, or securities or rights
convertible  into,  any shares of  capital  stock of the  Company.  Furthermore,
except  as set  forth in this  Agreement  and as set  forth on  Schedule  2.1(c)
hereto, there are no contracts, commitments,  understandings, or arrangements by
which the  Company  is or may  become  bound to issue  additional  shares of the
capital stock of the Company or options,  securities or rights  convertible into
shares  of  capital  stock  of  the  Company.   Except  for  customary  transfer
restrictions  contained  in  agreements  entered into by the Company in order to
sell restricted securities or as provided on Schedule 2.1(c) hereto, the Company
is  not a  party  to  or  bound  by  any  agreement  or  understanding  granting
registration  or  anti-dilution  rights to any person with respect to any of its
equity or debt securities,  or any combination  thereof.  Except as set forth on
Schedule 2.1(c),  the Company is not a party to, and it has no knowledge of, any
agreement or  understanding  restricting the voting or transfer of any shares of
the capital stock of the Company.

            (d) Issuance of Securities. The Shares and the Warrants to be issued
at the Closing have been duly authorized by all necessary  corporate action and,
when paid for and issued in  accordance  with the terms hereof and the Warrants,
respectively,  the Shares and the Warrant Shares will be validly  issued,  fully
paid and nonassessable and free and clear of all liens,  encumbrances and rights
of refusal of any kind and the holders shall be entitled to all rights  accorded
to a holder of Common Stock.

            (e) No Conflicts.  The  execution,  delivery and  performance of the
Transaction  Documents by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby do not and will not (i) violate any
provision of the Company's  Certificate of Incorporation (the  "Certificate") or
Bylaws (the "Bylaws"),  each as amended to date, or any Subsidiary's  comparable
charter  documents,  (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,  mortgage, deed of trust, indenture, note, bond,
license,  lease agreement,  instrument or obligation to which the Company or any
of  its  Subsidiaries  is a  party  or by  which  the  Company  or  any  of  its
Subsidiaries'  respective  properties or assets are bound,  or (iii) result in a
violation of any federal,  state,  local or foreign statute,  rule,  regulation,
order,  judgment  or decree  (including  federal and state  securities  laws and

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regulations)  applicable to the Company or any of its  Subsidiaries  or by which
any  property  or asset of the Company or any of its  Subsidiaries  are bound or
affected, except, in all cases, other than violations pursuant to clauses (i) or
(iii) (with respect to federal and state  securities  laws) above,  except,  for
such conflicts, defaults, terminations, amendments, acceleration,  cancellations
and violations as would not,  individually or in the aggregate,  have a Material
Adverse  Effect.  The business of the Company and its  Subsidiaries is not being
conducted  in  violation  of  any  laws,   ordinances  or   regulations  of  any
governmental entity, except for possible violations,  which singularly or in the
aggregate  do not and will not  have a  Material  Adverse  Effect.  Neither  the
Company nor any of its Subsidiaries is required under federal, state, foreign or
local law, rule or regulation 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 its  obligations  under the
Transaction  Documents or issue and sell the  Securities in accordance  with the
terms  hereof  (other than any  filings,  consents  and  approvals  which may be
required to be made by the Company under applicable state and federal securities
laws, rules or regulations, the OTC Bulletin Board prior to or subsequent to the
Closing,  or any registration  provisions  provided in the  Registration  Rights
Agreement).

            (f) Commission Documents,  Financial Statements. The Common Stock of
the Company is registered  pursuant to Section 12(b) or 12(g) of the  Securities
Exchange Act of 1934, as amended (the "Exchange Act"),  and, except as disclosed
on Schedule 2.1(f) hereto, the Company has timely filed all reports,  schedules,
forms,  statements  and  other  documents  required  to be  filed by it with the
Securities and Exchange Commission (the "Commission")  pursuant to the reporting
requirements  of the  Exchange  Act  (all  of the  foregoing  including  filings
incorporated  by reference  therein being referred to herein as the  "Commission
Documents").  At the times of their  respective  filing,  the Forms 10-Q for the
fiscal quarters March 31, 2003, June 30, 2003 and September 30, 2003 (the "Forms
10-Q") and the Form 10-K for the fiscal year ended  December 31, 2002 (the "Form
10-K") complied in all material  respects with the  requirements of the Exchange
Act and the rules and regulations of the Commission  promulgated  thereunder and
other federal,  state and local laws,  rules and regulations  applicable to such
documents, and the Forms 10-Q and Form 10-K 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. As of their respective
dates,  the  financial  statements  of the Company  included  in the  Commission
Documents  complied  as  to  form  in  all  material  respects  with  applicable
accounting   requirements  and  the  published  rules  and  regulations  of  the
Commission or other applicable rules and regulations with respect thereto.  Such
financial  statements have been prepared in accordance  with generally  accepted
accounting  principles ("GAAP") applied on a consistent basis during the periods
involved (except (i) as may be otherwise indicated in such financial  statements
or the Notes thereto or (ii) in the case of unaudited interim statements, to the
extent  they  may  not  include   footnotes  or  may  be  condensed  or  summary
statements),  and fairly present in all material respects the financial position
of the Company and its  Subsidiaries  as of the dates thereof and the results of
operations  and cash flows for the periods then ended  (subject,  in the case of
unaudited statements, to normal year-end audit adjustments).

            (g) Subsidiaries.  Schedule 2.1(g) hereto sets forth each Subsidiary
of the Company,  showing the  jurisdiction of its  incorporation or organization
and showing the percentage of each person's  ownership of the outstanding  stock
or other  interests  of such  Subsidiary.  For the  purposes of this  Agreement,

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"Subsidiary"  shall  mean any  corporation  or other  entity of which at least a
majority of the securities or other  ownership  interest  having ordinary voting
power  (absolutely  or  contingently)  for the  election of  directors  or other
persons  performing  similar  functions  are  at  the  time  owned  directly  or
indirectly  by the  Company  and/or  any of its other  Subsidiaries.  All of the
outstanding shares of capital stock of each Subsidiary have been duly authorized
and  validly  issued,  and  are  fully  paid  and  nonassessable.  There  are no
outstanding  preemptive,  conversion  or  other  rights,  options,  warrants  or
agreements  granted or issued by or binding upon any Subsidiary for the purchase
or  acquisition  of any shares of capital  stock of any  Subsidiary or any other
securities  convertible  into,  exchangeable  for or  evidencing  the  rights to
subscribe  for any shares of such  capital  stock.  Neither  the Company nor any
Subsidiary is subject to any obligation  (contingent or otherwise) to repurchase
or otherwise acquire or retire any shares of the capital stock of any Subsidiary
or any convertible securities, rights, warrants or options of the type described
in the preceding sentence except as set forth on Schedule 2.1(g) hereto. Neither
the  Company  nor any  Subsidiary  is party to,  nor has any  knowledge  of, any
agreement  restricting the voting or transfer of any shares of the capital stock
of any Subsidiary.

            (h) No Material  Adverse  Change.  Since  September  30,  2003,  the
Company has not experienced or suffered any Material  Adverse Effect,  except as
disclosed on Schedule 2.1(h) hereto.

            (i) No  Undisclosed  Liabilities.  Except as  disclosed  on Schedule
2.1(i)  hereto,  since  September  30, 2003,  neither the Company nor any of its
Subsidiaries  has  incurred  any  liabilities,  obligations,  claims  or  losses
(whether liquidated or unliquidated,  secured or unsecured,  absolute,  accrued,
contingent or otherwise) other than those incurred in the ordinary course of the
Company's or its Subsidiaries  respective businesses and which,  individually or
in the aggregate, are not reasonably likely to have a Material Adverse Effect.

            (j) No  Undisclosed  Events or  Circumstances.  Since  September 30,
2003,  except as disclosed on Schedule  2.1(j) hereto,  no event or circumstance
has occurred or exists with respect to the Company or its  Subsidiaries or their
respective businesses, properties, prospects, operations or financial condition,
which,  under applicable law, rule or regulation,  requires public disclosure or
announcement  by the  Company but which has not been so  publicly  announced  or
disclosed.

            (k)  Indebtedness.  Schedule 2.1(k) hereto sets forth as of the date
hereof all outstanding secured and unsecured  Indebtedness of the Company or any
Subsidiary, or for which the Company or any Subsidiary has commitments.  For the
purposes of this  Agreement,  "Indebtedness"  shall mean (a) any liabilities for
borrowed money or amounts owed in excess of $100,000  (other than trade accounts
payable  incurred  in the  ordinary  course of  business),  (b) all  guaranties,
endorsements  and other  contingent  obligations in respect of  Indebtedness  of
others in excess of $100,000, whether or not the same are or should be reflected
in the Company's  balance  sheet (or the notes  thereto),  except  guaranties by
endorsement  of  negotiable  instruments  for deposit or  collection  or similar
transactions  in the ordinary  course of business;  and (c) the present value of
any lease  payments  in excess  of  $25,000  due  under  leases  required  to be
capitalized in accordance  with GAAP.  Neither the Company nor any Subsidiary is
in default with respect to any Indebtedness.

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            (l) Title to Assets.  Each of the Company and the  Subsidiaries  has
good and marketable title to all of its real and personal property  reflected in
the Commission  Documents,  free and clear of any mortgages,  pledges,  charges,
liens,  security interests or other encumbrances,  except for those indicated on
Schedule 2.1(l) hereto or such that,  individually  or in the aggregate,  do not
cause a Material Adverse Effect.  All said leases of the Company and each of its
Subsidiaries are valid and subsisting and in full force and effect.

            (m) Actions Pending. There is no action, suit, claim, investigation,
arbitration, alternate dispute resolution proceeding or other proceeding pending
or, to the  knowledge  of the  Company,  threatened  against  the Company or any
Subsidiary  which  questions the validity of this  Agreement or any of the other
Transaction Documents or any of the transactions  contemplated hereby or thereby
or any action  taken or to be taken  pursuant  hereto or thereto.  Except as set
forth on Schedule 2.1(m) hereto, there is no action, suit, claim, investigation,
arbitration, alternate dispute resolution proceeding or other proceeding pending
or, to the  knowledge  of the  Company,  threatened,  against or  involving  the
Company,  any Subsidiary or any of their respective  properties or assets, which
individually  or in the  aggregate,  could  reasonably  be  expected  to  have a
Material   Adverse  Effect.   There  are  no  outstanding   orders,   judgments,
injunctions,  awards or decrees  of any court,  arbitrator  or  governmental  or
regulatory  body  against  the  Company or any  Subsidiary  or any  officers  or
directors  of the  Company or  Subsidiary  in their  capacities  as such,  which
individually  or in the  aggregate,  could  reasonably  be  expected  to  have a
Material Adverse Effect.

            (n)  Compliance  with  Law.  The  business  of the  Company  and the
Subsidiaries  has been and is presently  being  conducted in accordance with all
applicable  federal,  state and local governmental laws, rules,  regulations and
ordinances,  except  as set forth in the  Commission  Documents  or on  Schedule
2.1(n) hereto or such that, individually or in the aggregate,  the noncompliance
therewith  could not reasonably be expected to have a Material  Adverse  Effect.
The Company and each of its Subsidiaries have all franchises, permits, licenses,
consents and other  governmental  or  regulatory  authorizations  and  approvals
necessary  for the conduct of its  business as now being  conducted by it unless
the failure to possess such franchises,  permits,  licenses,  consents and other
governmental or regulatory authorizations and approvals,  individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.

            (o)  Taxes.  Except  as set forth on  Schedule  2.1(o)  hereto,  the
Company  and each of the  Subsidiaries  has  accurately  prepared  and filed all
federal, state and other tax returns required by law to be filed by it, has paid
or  made  provisions  for  the  payment  of all  taxes  shown  to be due and all
additional  assessments,  and adequate provisions have been and are reflected in
the  financial  statements of the Company and the  Subsidiaries  for all current
taxes and other  charges to which the Company or any  Subsidiary  is subject and
which are not currently due and payable.  Except as disclosed on Schedule 2.1(o)
hereto,  none of the federal income tax returns of the Company or any Subsidiary
have been audited by the Internal Revenue Service.  The Company has no knowledge
of any additional assessments,  adjustments or contingent tax liability (whether
federal  or state) of any  nature  whatsoever,  whether  pending  or  threatened
against the Company or any Subsidiary  for any period,  nor of any basis for any
such assessment, adjustment or contingency.

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            (p) Certain Fees.  Except as set forth on Schedule 2.1(p) hereto and
for certain fees payable to a certain  individual in connection with the Closing
under this  Agreement,  the  Company  has not  employed  any broker or finder or
incurred  any  liability   for  any   brokerage  or  investment   banking  fees,
commissions, finders' structuring fees, financial advisory fees or other similar
fees in connection with the Transaction Documents.

            (q) Disclosure. To the best of the Company's knowledge, neither this
Agreement  or the  Schedules  hereto nor any other  documents,  certificates  or
instruments  furnished to the  Purchasers  by or on behalf of the Company or any
Subsidiary in connection  with the  transactions  contemplated by this Agreement
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements  made herein or therein,  in the light
of the  circumstances  under  which  they  were  made  herein  or  therein,  not
misleading.

            (r)  Operation of Business.  Except as set forth on Schedule  2.1(r)
hereto, the Company and each of the Subsidiaries owns or possesses the rights to
all  patents,  trademarks,  domain  names  (whether or not  registered)  and any
patentable improvements or copyrightable derivative works thereof,  websites and
intellectual  property  rights  relating  thereto,  service marks,  trade names,
copyrights,  licenses and authorizations  which are necessary for the conduct of
its business as now conducted without any conflict with the rights of others.

            (s) Environmental Compliance. Except as disclosed on Schedule 2.1(s)
hereto,  the Company and each of its  Subsidiaries  have  obtained  all material
approvals, authorization,  certificates,  consents, licenses, orders and permits
or other similar  authorizations  of all governmental  authorities,  or from any
other person,  that are required under any  Environmental  Laws.  "Environmental
Laws"  shall  mean  all  applicable  laws  relating  to  the  protection  of the
environment  including,  without  limitation,  all  requirements  pertaining  to
reporting,  licensing,  permitting,  controlling,  investigating  or remediating
emissions,  discharges, releases or threatened releases of hazardous substances,
chemical substances, pollutants,  contaminants or toxic substances, materials or
wastes, whether solid, liquid or gaseous in nature, into the air, surface water,
groundwater or land, or relating to the manufacture,  processing,  distribution,
use,  treatment,   storage,   disposal,   transport  or  handling  of  hazardous
substances, chemical substances,  pollutants,  contaminants or toxic substances,
material or wastes,  whether solid,  liquid or gaseous in nature.  Except as set
forth on Schedule  2.1(s)  hereto,  the Company has all  necessary  governmental
approvals  required under all Environmental  Laws and used in its business or in
the business of any of its Subsidiaries,  except for such instances as would not
individually or in the aggregate have a Material Adverse Effect. The Company and
each of its  Subsidiaries  are also in  compliance  with all other  limitations,
restrictions,  conditions,  standards,  requirements,  schedules and  timetables
required or imposed under all  Environmental  Laws. Except for such instances as
would not individually or in the aggregate have a Material Adverse Effect, there
are no past or present events, conditions, circumstances,  incidents, actions or
omissions  relating to or in any way affecting  the Company or its  Subsidiaries
that  violate or would be  reasonably  likely to violate any  Environmental  Law
after  the  Closing  or that  would be  reasonably  likely  to give  rise to any
environmental  liability,  or  otherwise  form the basis of any  claim,  action,
demand,  suit,  proceeding,  hearing,  study  or  investigation  (i)  under  any
Environmental  Law, or (ii) based on or related to the manufacture,  processing,
distribution,   use,   treatment,   storage   (including,   without  limitation,
underground storage tanks),  disposal,  transport or handling,  or the emission,
discharge,   release  or  threatened   release  of  any   hazardous   substance.

                                       7
<PAGE>

"Environmental  Liabilities"  means all  liabilities  of a person  (whether such
liabilities are owed by such person to governmental  authorities,  third parties
or otherwise)  whether  currently in existence or arising  hereafter which arise
under or relate to any Environmental Law.

            (t) Books and Records; Internal Accounting Controls. The records and
documents of the Company and its Subsidiaries accurately reflect in all material
respects  the  information  relating  to the  business  of the  Company  and the
Subsidiaries, the location and collection of their assets, and the nature of all
transactions  giving  rise to the  obligations  or  accounts  receivable  of the
Company or any Subsidiary.  The Company and each of its Subsidiaries  maintain a
system of  internal  accounting  controls  sufficient,  in the  judgment  of the
Company's  board  of  directors,   to  provide  reasonable  assurance  that  (i)
transactions  are executed in accordance with  management's  general or specific
authorizations,   (ii)   transactions   are  recorded  as  necessary  to  permit
preparation  of financial  statements  in  conformity  with  generally  accepted
accounting  principles  and to maintain  asset  accountability,  (iii) access to
assets is permitted  only in accordance  with  management's  general or specific
authorization and (iv) the recorded  accountability  for assets is compared with
the existing assets at reasonable  intervals and  appropriate  actions are taken
with respect to any differences.

            (u) Material Agreements.  Except for the Transaction Documents (with
respect to clause (i) only), or as disclosed in the Commission Documents,  or as
set forth on Schedule  2.1(u)  hereto,  or as would not be reasonably  likely to
have a Material  Adverse  Effect,  (i) the Company and each of its  Subsidiaries
have  performed all  obligations  required to be performed by them to date under
any written or oral contract,  instrument,  agreement,  commitment,  obligation,
plan or  arrangement,  filed or  required to be filed with the  Commission  (the
"Material Agreements"), (ii) neither the Company nor any of its Subsidiaries has
received any notice of default under any Material  Agreement  and,  (iii) to the
best of the Company's knowledge, neither the Company nor any of its Subsidiaries
is in default under any Material Agreement now in effect.

            (v) Transactions  with  Affiliates.  Except as set forth on Schedule
2.1(v)  hereto,  there  are no loans,  leases,  agreements,  contracts,  royalty
agreements,   management   contracts  or   arrangements   or  other   continuing
transactions  between (a) the Company, any Subsidiary or any of their respective
customers or suppliers on the one hand,  and (b) on the other hand, any officer,
employee,  consultant or director of the Company, or any of its Subsidiaries, or
any person  owning any  capital  stock of the Company or any  Subsidiary  or any
member of the immediate family of such officer, employee,  consultant,  director
or  stockholder or any  corporation or other entity  controlled by such officer,
employee,  consultant,  director or  stockholder,  or a member of the  immediate
family of such officer, employee, consultant,  director or stockholder which, in
each case,  is required to be  disclosed in the  Commission  Documents or in the
Company's most recently filed  definitive  proxy statement on Schedule 14A, that
is not so disclosed in the Commission Documents or in such proxy statement.

            (w) Securities Act of 1933.  Based in part upon the  representations
of the  Purchasers in this  Agreement,  the Company has complied and will comply
with all applicable  federal and state  securities  laws in connection  with the
offer,  issuance and sale of the Securities  hereunder.  Neither the Company nor
anyone acting on its behalf, directly or indirectly,  has or will sell, offer to
sell or solicit offers to buy any of the Securities or similar securities to, or

                                       8
<PAGE>

solicit  offers  with  respect  thereto  from,  or enter  into any  negotiations
relating thereto with, any person, or has taken or will take any action so as to
bring the  issuance  and sale of any of the  Securities  under the  registration
provisions of the  Securities  Act and  applicable  state  securities  laws, and
neither the Company nor any of its  affiliates,  nor any person acting on its or
their  behalf,  has  engaged  in any form of  general  solicitation  or  general
advertising  (within the meaning of  Regulation D under the  Securities  Act) in
connection with the offer or sale of any of the Securities.

            (x) Governmental  Approvals.  Except as set forth on Schedule 2.1(x)
hereto,  and  except for the filing of any  notice  prior or  subsequent  to the
Closing that may be required under  applicable  state and/or federal  securities
laws (which if required,  shall be filed on a timely basis),  no  authorization,
consent, approval,  license, exemption of, filing or registration with any court
or   governmental   department,    commission,    board,   bureau,   agency   or
instrumentality,  domestic  or  foreign,  is or will  be  necessary  for,  or in
connection  with,  the  execution  or  delivery  of the  Securities,  or for the
performance by the Company of its obligations under the Transaction Documents.

            (y)  Employees.  Neither  the  Company  nor any  Subsidiary  has any
collective bargaining  arrangements or agreements covering any of its employees,
except as set forth on Schedule  2.1(y) hereto.  Except as set forth on Schedule
2.1(y)  hereto,  neither  the  Company  nor any  Subsidiary  has any  employment
contract,   agreement   regarding   proprietary   information,   non-competition
agreement,  non-solicitation agreement,  confidentiality agreement, or any other
similar contract or restrictive covenant,  relating to the right of any officer,
employee  or  consultant  to be  employed  or  engaged  by the  Company  or such
Subsidiary  required to be disclosed in the Commission  Documents that is not so
disclosed.  Since  December 31, 2003, no officer,  consultant or key employee of
the Company or any Subsidiary whose termination,  either  individually or in the
aggregate,  would be reasonably  likely to have a Material  Adverse Effect,  has
terminated  or, to the  knowledge of the Company,  has any present  intention of
terminating  his or  her  employment  or  engagement  with  the  Company  or any
Subsidiary.

            (z) Absence of Certain  Recent  Developments.  Except as provided on
Schedule 2.1(z) hereto,  since  September 30, 2003,  neither the Company nor any
Subsidiary has:

                  (i)  borrowed  any amount in excess of $100,000 or incurred or
become  subject to any other  liabilities  in excess of  $100,000  (absolute  or
contingent)  except  current  liabilities  incurred  in the  ordinary  course of
business  which are  comparable in nature and amount to the current  liabilities
incurred in the ordinary course of business during the comparable portion of its
prior fiscal year,  as adjusted to reflect the current  nature and volume of the
business of the Company and its  Subsidiaries;

                  (ii) discharged or satisfied any lien or encumbrance in excess
of $100,000 or paid any  obligation  or liability  (absolute or  contingent)  in
excess of $100,000,  other than current  liabilities paid in the ordinary course
of business;

                  (iii) declared or made any payment or  distribution of cash or
other  property to  stockholders  with  respect to its stock,  or  purchased  or
redeemed,  or made any  agreements  so to purchase or redeem,  any shares of its

                                       9
<PAGE>

capital stock, in each case in excess of $25,000  individually or $50,000 in the
aggregate;

                  (iv) sold,  assigned or transferred any other tangible assets,
or canceled  any debts or claims,  in each case in excess of $50,000,  except in
the ordinary course of business;

                  (v)  sold,   assigned  or   transferred   any  patent  rights,
trademarks, trade names, copyrights, trade secrets or other intangible assets or
intellectual  property rights in excess of $50,000, or disclosed any proprietary
confidential  information  to any person  except to  customers  in the  ordinary
course of business or to the Purchasers or their representatives;

                  (vi)  suffered  any  material  losses or waived  any rights of
material value,  whether or not in the ordinary course of business,  or suffered
the loss of any material amount of prospective business;

                  (vii) made any changes in employee  compensation except in the
ordinary course of business and consistent with past practices;

                  (viii) made capital  expenditures or commitments therefor that
aggregate  in  excess  of  $100,000  except  for such  capital  expenditures  or
commitments made in the ordinary course of business;

                  (ix) entered into any material transaction,  whether or not in
the ordinary course of business;

                  (x) made  charitable  contributions  or  pledges  in excess of
$25,000;

                  (xi)  suffered any material  damage,  destruction  or casualty
loss, whether or not covered by insurance;

                  (xii)   experienced  any  material   problems  with  labor  or
management in connection with the terms and conditions of their  employment;  or

                  (xiii)  entered into an agreement,  written or  otherwise,  to
take any of the foregoing actions.

            (aa) Public Utility Holding  Company Act and Investment  Company Act
Status.  The Company is not a "holding company" or a "public utility company" as
such terms are defined in the Public  Utility  Holding  Company Act of 1935,  as
amended. The Company is not, and as a result of and immediately upon the Closing
will not be, an "investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.

            (bb) ERISA. No liability to the Pension Benefit Guaranty Corporation
has  been  incurred  with  respect  to any  Plan  by the  Company  or any of its
Subsidiaries  which is or would be  materially  adverse to the  Company  and its
Subsidiaries.  The execution and delivery of this Agreement and the issuance and

                                       10
<PAGE>

sale of the Shares and the Warrants  will not involve any  transaction  which is
subject to the  prohibitions of Section 406 of ERISA or in connection with which
a tax could be imposed  pursuant to Section 4975 of the Internal Revenue Code of
1986,  as amended,  provided  that, if any of the  Purchasers,  or any person or
entity that owns a beneficial interest in any of the Purchasers, is an "employee
pension benefit plan" (within the meaning of Section 3(2) of ERISA) with respect
to which the  Company is a "party in  interest"  (within  the meaning of Section
3(14) of ERISA),  the requirements of Sections 407(d)(5) and 408(e) of ERISA, if
applicable, are met. As used in this Section 2.1(bb), the term "Plan" shall mean
an "employee  pension  benefit plan" (as defined in Section 3 of ERISA) which is
or has been  established or maintained,  or to which  contributions  are or have
been made, by the Company or any Subsidiary or by any trade or business, whether
or not  incorporated,  which,  together with the Company or any  Subsidiary,  is
under common control, as described in Section 414(b) or (c) of the Code.

            (cc)  Delisting  Notification.  The Company has not received  notice
(written or oral) from the OTC Bulletin  Board to the effect that the Company is
not in compliance with the listing or maintenance requirements of such quotation
system and, to the Company's  knowledge,  the Company is in compliance  with all
OTC Bulletin Board listing or maintenance requirements.

            (dd) Independent Nature of Purchasers. The Company acknowledges that
the obligations of each Purchaser  under the  Transaction  Documents are several
and not joint with the  obligations  of any other  Purchaser,  and no  Purchaser
shall be  responsible in any way for the  performance of the  obligations of any
other Purchaser under the Transaction Documents.  The decision of each Purchaser
to  purchase  Securities  pursuant  to  this  Agreement  has  been  made by such
Purchaser   independently  of  any  other  purchase  and  independently  of  any
information,  materials,  statements  or opinions as to the  business,  affairs,
operations, assets, properties,  liabilities,  results of operations,  condition
(financial  or  otherwise)  or prospects  of the Company or of its  Subsidiaries
which may have made or given by any other  Purchaser or by any agent or employee
of any other Purchaser, and no Purchaser or any of its agents or employees shall
have any liability to any Purchaser (or any other person) relating to or arising
from any such  information,  materials,  statements  or  opinions.  The  Company
further  acknowledges  that  nothing  contained  herein,  or in any  Transaction
Document, and no action taken by any Purchaser pursuant hereto or thereto, shall
be deemed to constitute the Purchasers as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Purchasers
are in any way acting in concert or as a group with respect to such  obligations
or the transactions  contemplated by the Transaction  Documents.  Each Purchaser
shall be entitled  to  independently  protect and enforce its rights,  including
without limitation, the rights arising out of this Agreement or out of the other
Transaction Documents,  and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose. For reasons
of administrative convenience only, the Transaction Documents have been prepared
by counsel for one of the Purchasers. Such counsel does not represent all of the
Purchasers but only such Purchaser and the other  Purchasers have retained their
own individual counsel with respect to the transactions contemplated hereby. The
Company  has  elected  to  provide  all  Purchasers  with  the  same  terms  and
Transaction  Documents for the convenience of the Company and not as a result of
a requirement or request to do so by the  Purchasers.  The Company  acknowledges
that such procedure with respect to the Transaction  Documents in no way creates
a presumption that the Purchasers are in any way acting in concert or as a group

                                       11
<PAGE>

with  respect to the  Transaction  Documents  or the  transactions  contemplated
hereby or thereby.

            (ee) No  Integrated  Offering.  Neither the Company,  nor any of its
affiliates,  nor any  person  acting on its or their  behalf,  has  directly  or
indirectly  made any offers or sales of any security or solicited  any offers to
buy any  security  under  circumstances  that would  cause the  offering  of the
Securities  pursuant to this Agreement to be integrated  with prior offerings by
the Company for purposes of the  Securities  Act which would prevent the Company
from selling the Securities  pursuant to Regulation D and Rule 506 thereof under
the Securities  Act, or any  applicable  exchange-related  stockholder  approval
provisions,  nor will the Company or any of its affiliates or subsidiaries  take
any  action or steps that  would  cause the  offering  of the  Securities  to be
integrated  with other  offerings.  The Company  does not have any  registration
statement  pending  before the  Commission or currently  under the  Commission's
review.

            (ff)  Sarbanes-Oxley  Act. The Company is in substantial  compliance
with  the  applicable   provisions  of  the  Sarbanes-Oxley  Act  of  2002  (the
"Sarbanes-Oxley  Act"),  and the rules and regulations  promulgated  thereunder,
that are effective,  and intends to comply  substantially  with other applicable
provisions of the Sarbanes-Oxley Act, and the rules and regulations  promulgated
thereunder, upon the effectiveness of such provisions.

            Section  2.2.Representations and Warranties of the Purchasers.  Each
of the  Purchasers  hereby  represents  and warrants to the Company with respect
solely to itself and not with  respect to any other  Purchaser  as follows as of
the date hereof and as of the Closing Date:

            (a) Organization and Standing of the Purchasers. If the Purchaser is
an  entity,  such  Purchaser  is a  corporation,  limited  liability  company or
partnership  duly  incorporated  or  organized,  validly  existing  and in  good
standing  under  the  laws  of  the   jurisdiction  of  its   incorporation   or
organization.

            (b)  Authorization and Power. Each Purchaser has the requisite power
and  authority  to enter  into and  perform  the  Transaction  Documents  and to
purchase the Securities being sold to it hereunder. The execution,  delivery and
performance of the Transaction  Documents by each Purchaser and the consummation
by it of the transactions  contemplated  hereby have been duly authorized by all
necessary   corporate  or  partnership   action,   and  no  further  consent  or
authorization  of such  Purchaser or its Board of  Directors,  stockholders,  or
partners,  as the case may be, is required.  When  executed and delivered by the
Purchasers,  the other Transaction  Documents shall constitute valid and binding
obligations of each Purchaser  enforceable  against such Purchaser 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,  creditor's  rights  and  remedies  or by other
equitable principles of general application.

            (c) No Conflict.  The  execution,  delivery and  performance  of the
Transaction  Documents by the Purchaser and the consummation by the Purchaser of
the transactions contemplated thereby and hereby do not and will not (i) violate
any  provision of the  Purchaser's  charter or  organizational  documents,  (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

                                       12
<PAGE>

termination,   amendment,   acceleration  or  cancellation  of,  any  agreement,
mortgage,  deed of trust,  indenture,  note,  bond,  license,  lease  agreement,
instrument  or  obligation  to which  the  Purchaser  is a party or by which the
Purchaser's  respective  properties  or assets are bound,  or (iii)  result in a
violation of any federal,  state,  local or foreign statute,  rule,  regulation,
order,  judgment  or decree  (including  federal and state  securities  laws and
regulations)  applicable  to the  Purchaser or by which any property or asset of
the Purchaser are bound or affected, except, in all cases, other than violations
pursuant to clauses (i) or (iii) (with  respect to federal and state  securities
laws) above,  except, for such conflicts,  defaults,  terminations,  amendments,
acceleration,  cancellations and violations as would not, individually or in the
aggregate,  materially and adversely  affect the Purchaser's  ability to perform
its obligations under the Transaction Documents.

            (d)  Acquisition  for  Investment.  Each Purchaser is purchasing the
Shares and Warrants solely for its own account for the purpose of investment and
not with a view to or for sale in connection with  distribution.  Each Purchaser
does not have a present  intention to sell any of the Shares or Warrants,  nor a
present arrangement  (whether or not legally binding) or intention to effect any
distribution  of any of the  Shares or  Warrants  to or  through  any  person or
entity;  provided,  however,  that by making the  representations  herein,  such
Purchaser  does not agree to hold the Shares or the  Warrants for any minimum or
other  specific  term and  reserves  the right to  dispose  of the Shares or the
Warrants  at any time in  accordance  with  Federal  and state  securities  laws
applicable to such disposition. Each Purchaser acknowledges that it (i) has such
knowledge and  experience in financial and business  matters such that Purchaser
is capable of evaluating the merits and risks of  Purchaser's  investment in the
Company,  (ii) is able to bear the financial risks associated with an investment
in the  Securities  and (iii) 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.

            (e) Rule 144. Each Purchaser understands that the Securities must be
held indefinitely  unless such Shares are registered under the Securities Act or
an exemption from  registration is available.  Each Purchaser  acknowledges that
such  person is  familiar  with Rule 144 of the  rules  and  regulations  of the
Commission, as amended, promulgated pursuant to the Securities Act ("Rule 144"),
and that such  Purchaser  has been  advised  that Rule 144 permits  resales only
under certain circumstances.  Each Purchaser understands that to the extent that
Rule 144 is not available,  such Purchaser will be unable to sell any Securities
without either registration under the Securities Act or the existence of another
exemption from such registration requirement.

            (f) General.  Each  Purchaser  understands  that the  Securities are
being  offered  and  sold in  reliance  on a  transactional  exemption  from the
registration  requirements of federal and state  securities laws and the Company
is  relying  upon the truth and  accuracy  of the  representations,  warranties,
agreements,  acknowledgments  and  understandings  of such  Purchaser  set forth
herein  in order to  determine  the  applicability  of such  exemptions  and the
suitability  of  such  Purchaser  to  acquire  the  Securities.  Each  Purchaser
understands  that no United States  federal or state agency or any government or
governmental agency has passed upon or made any recommendation or endorsement of
the Securities.

                                       13
<PAGE>

            (g) No General  Solicitation.  Each Purchaser  acknowledges that the
Securities were not offered to such Purchaser by means of any form of general or
public   solicitation   or  general   advertising,   or  publicly   disseminated
advertisements or sales literature,  including (i) any  advertisement,  article,
notice or other communication  published in any newspaper,  magazine, or similar
media,  or broadcast over television or radio, or (ii) any seminar or meeting to
which  such   Purchaser   was  invited  by  any  of  the   foregoing   means  of
communications.

            (h) Accredited Investor.  Each Purchaser is an "accredited investor"
(as defined in Rule 501 of Regulation D), and such Purchaser has such experience
in business and financial  matters that it is capable of  evaluating  the merits
and risks of an investment in the Securities.  Such Purchaser is not required to
be registered as a  broker-dealer  under Section 15 of the Exchange Act and such
Purchaser is not a broker-dealer. Each Purchaser acknowledges that an investment
in the  Securities  is  speculative  and  involves a high  degree of risk.  Each
Purchaser  has  completed or caused to be completed  the Investor  Questionnaire
Certification  attached  hereto as Exhibit D  certifying  as to its status as an
"accredited investor" and understands that the Company is relying upon the truth
and accuracy of the Purchaser set forth therein to determine the  suitability of
such Purchaser to acquire the Securities.

            (i) Certain  Fees.  The  Purchasers  have not employed any broker or
finder or incurred any liability  for any brokerage or investment  banking fees,
commissions, finders' structuring fees, financial advisory fees or other similar
fees in connection with the Transaction Documents.

            (j) Independent Investment.  No Purchaser has agreed to act with any
other  Purchaser for the purpose of acquiring,  holding,  voting or disposing of
the  Securities  purchased  hereunder  for  purposes of Section  13(d) under the
Exchange  Act, and each  Purchaser is acting  independently  with respect to its
investment in the Securities.

            (k) Patriot Act. If the  Purchaser is an  individual,  the Purchaser
certifies that he or she is not nor to his or her knowledge has been designated,
a "suspected terrorist" as defined in Executive Order 13224. If the Purchaser is
a  corporation,   trust,   partnership,   limited  liability  company  or  other
organization,   the  Purchaser  certifies  that,  to  the  best  of  Purchaser's
knowledge,  the  Purchaser  has  not  been  designated,  and  is  not  owned  or
controlled,  by a "suspected terrorist" as defined in Executive Order 13224. The
Purchaser  hereby  acknowledges  that  the  Company  seeks  to  comply  with all
applicable  laws  concerning  money  laundering  and  related   activities.   In
furtherance  of those efforts,  the Purchaser  hereby  represents,  warrants and
agrees  that to its  knowledge:  (i)  none  of the  cash or  property  that  the
Purchaser  will  pay or will  contribute  to the  Company  has  been or shall be
derived from, or related to, any activity that is deemed  criminal  under United
States law; and (ii) no contribution or payment by the Purchaser to the Company,
to the extent  that they are  within the  Purchaser's  control  shall  cause the
Company to be in  violation  of the United  States Bank  Secrecy Act, the United
States  International  Money Laundering Control Act of 1986 or the United States
International  Money Laundering  Abatement and  Anti-Terrorist  Financing Act of
2001.  The  Purchaser  shall  promptly  notify  the  Company  if  any  of  these
representations  ceases to be true and accurate  regarding  the  Purchaser.  The
Purchaser agrees to provide the Company any additional information regarding the
Purchaser  that the Company deems  necessary or convenient to ensure  compliance
with all applicable laws concerning money laundering and similar activities. The
Purchaser  understands  and agrees that if at any time it is discovered that any

                                       14
<PAGE>

of the foregoing  representations  are  incorrect,  or if otherwise  required by
applicable law or regulation related to money laundering similar activities, the
Company may undertake  appropriate  actions to ensure compliance with applicable
law or regulation, including but not limited to segregation and/or redemption of
the  Purchaser's  investment  in the  Company.  In the event that the Company is
requested  or required (by  deposition,  interrogatory,  request for  documents,
subpoena,  civil investigative demand or similar legal,  judiciary or regulatory
process or as otherwise  required by applicable  law or  regulation) to disclose
any confidential  information  about a Purchaser,  the Company shall (A) provide
the Purchaser  with prompt prior written  notice of such request or  requirement
and (B) cooperate with the Purchaser so that the Purchaser may seek a protective
order or other  appropriate  remedy.  In the event that such protective order or
other remedy is not obtained,  the Company and their respective  representatives
shall  disclose  only that  portion of the  confidential  information  that such
person is  advised  by legal  counsel  in  writing  is  legally  required  to be
disclosed,  and  provided  that the Company  uses  reasonable  efforts to obtain
reliable assurance that confidential treatment will be accorded any confidential
information so disclosed.

                                  ARTICLE III

                                   COVENANTS

      The Company covenants with each Purchaser as follows,  which covenants are
for the benefit of each Purchaser and their respective permitted assignees.

            Section  3.1.Securities  Compliance.  The Company  shall  notify the
Commission in accordance  with its rules and  regulations,  of the  transactions
contemplated  by any of the  Transaction  Documents  and  shall  take all  other
necessary  action and proceedings as may be required and permitted by applicable
law, rule and regulation,  for the legal and valid issuance of the Securities to
the Purchasers, or their respective subsequent holders.

            Section 3.2  Registration  and  Listing.  The Company  shall use its
reasonable  best efforts to cause its Common Stock to continue to be  registered
under  Sections  12(b) or 12(g) of the  Exchange  Act, to comply in all respects
with its reporting and filing obligations under the Exchange Act, to comply with
all requirements  related to any  registration  statement filed pursuant to this
Agreement,  and to not take any  action  or file any  document  (whether  or not
permitted  by the  Securities  Act  or  the  rules  promulgated  thereunder)  to
terminate or suspend such  registration or to terminate or suspend its reporting
and filing  obligations  under the Exchange  Act or  Securities  Act,  except as
permitted herein.  The Company shall use its reasonable best efforts to continue
the  listing or trading of its  Common  Stock on the OTC  Bulletin  Board or any
successor  market or quotation  system.  If required,  the Company will promptly
file a "Listing  Application"  for, or in  connection  with,  the  issuance  and
delivery of the Shares and the Warrant Shares.

            Section 3.3  Inspection  Rights.  The Company shall  permit,  during
normal business hours and upon reasonable  request and reasonable  notice,  each
Purchaser or any employees,  agents or representatives  thereof, so long as such
Purchaser  shall  be  obligated  hereunder  to  purchase  the  Shares  or  shall
beneficially own any Shares or Warrant Shares, for purposes reasonably related

                                       15
<PAGE>

to such  Purchaser's  interests as a stockholder to examine and make  reasonable
copies of and  extracts  from the records and books of account of, and visit and
inspect the properties,  assets,  operations and business of the Company and any
Subsidiary, and to discuss the affairs, finances and accounts of the Company and
any  Subsidiary  with  any of its  officers,  consultants,  directors,  and  key
employees.

            Section 3.4  Compliance  with Laws.  The Company shall  comply,  and
cause each Subsidiary to comply,  with all applicable laws,  rules,  regulations
and  orders,  noncompliance  with  which  would be  reasonably  likely to have a
Material Adverse Effect.

            Section 3.5  Keeping of Records  and Books of  Account.  The Company
shall keep adequate records and books of account, in which complete entries will
be made in accordance with GAAP consistently  applied,  reflecting all financial
transactions of the Company and its Subsidiaries on a consolidated basis, and in
which,  for each fiscal year, all proper reserves for  depreciation,  depletion,
obsolescence,  amortization,  taxes,  bad debts and other purposes in connection
with its business shall be made.

            Section 3.6 Reporting  Requirements.  If the Company  ceases to file
its periodic  reports with the  Commission,  or if the Commission  ceases making
these  periodic  reports  available via the Internet  without  charge,  then the
Company shall furnish the following to each  Purchaser so long as such Purchaser
shall be obligated  hereunder to purchase the  Securities or shall  beneficially
own Shares or Warrant Shares:

            (a) Quarterly Reports filed with the Commission on Form 10-Q as soon
as  available,  and in any event  within  forty-five  (45) days (or such shorter
period as may be required for  quarterly  reports  under the Exchange Act) after
the end of each of the first three fiscal quarters of the Company;

            (b) Annual Reports filed with the Commission on Form 10-K as soon as
available,  and in any event within ninety (90) days (or such shorter  period as
may be required for annual reports under the Exchange Act) after the end of each
fiscal year of the Company; and

            (c)  Copies of all  notices,  information  and proxy  statements  in
connection  with any  meetings,  that are, in each case,  provided to holders of
shares of Common Stock,  contemporaneously  with the delivery of such notices or
information to such holders of Common Stock.

            Section 3.7 Other  Agreements.  The Company shall not enter into any
agreement  in which the terms of such  agreement  would  restrict  or impair the
right  or  ability  to  perform  of the  Company  or any  Subsidiary  under  any
Transaction Document.

            Section 3.8 Subsequent Financings; Right of First Refusal. (a) For a
period of one (1) year  following  the Closing Date,  the Company  covenants and
agrees to promptly  notify (in no event later than five (5) days after making or
receiving an applicable  offer) in writing (a "Rights Notice") the Purchasers of
the terms and  conditions of any proposed offer or sale to, or exchange with (or
other type of distribution  to) any third party (a "Subsequent  Financing"),  of
Common Stock or any securities  convertible,  exercisable or  exchangeable  into
Common  Stock,   including  convertible  debt  securities   (collectively,   the
"Financing Securities"). The Rights Notice shall describe, in reasonable detail,

                                       16
<PAGE>

the proposed Subsequent  Financing,  the proposed closing date of the Subsequent
Financing,  which shall not be within ten (10)  calendar  days from the date the
Rights  Notice is given nor later than thirty (30)  calendar  days from the date
the Rights Notice is given, including,  without limitation,  all of the material
terms and conditions thereof and proposed definitive documentation to be entered
into in connection therewith.  The Rights Notice shall provide each Purchaser an
option (the "Rights Option") during the five (5) trading days following delivery
of the Rights Notice (the "Option Period") to purchase up to one hundred percent
(100%) of its Purchase Price for the securities being offered in such Subsequent
Financing on the same,  absolute  terms and conditions as  contemplated  by such
Subsequent  Financing (the "First Refusal Rights").  If any Purchaser elects not
to  participate  in  such  Subsequent   Financing,   the  other  Purchasers  may
participate on a pro-rata basis so long as such  participation  in the aggregate
does  not  exceed  one  hundred  percent  (100%)  of the  total  Purchase  Price
hereunder.  Delivery  of any Rights  Notice  constitutes  a  representation  and
warranty by the Company that there are no other material  terms and  conditions,
arrangements,  agreements or otherwise  except for those disclosed in the Rights
Notice,  to provide  additional  compensation to any party  participating in any
proposed  Subsequent  Financing,  including,  but  not  limited  to,  additional
compensation  based on  changes  in the  Purchase  Price or any type of reset or
adjustment of a purchase or conversion price or to issue  additional  securities
at any time after the closing  date of a  Subsequent  Financing.  If the Company
does not  receive  notice  of  exercise  of the  Rights  Option  from any of the
Purchasers  within the Option Period,  the Company shall have the right to close
the Subsequent  Financing on the scheduled closing date with a third party (and,
if  applicable,  with such  Purchasers  as shall  have  exercised  their  Rights
Option);  provided that all of the material  terms and conditions of the closing
are the same as those provided to the  Purchasers in the Rights  Notice.  If the
closing of the proposed  Subsequent  Financing  does not occur within sixty (60)
days from the date the Rights Notice is given,  any closing of the  contemplated
Subsequent  Financing or any other Subsequent  Financing shall be subject to all
of the provisions of this Section,  including,  without limitation, the delivery
of a new Rights Notice.

            (b) For  purposes  of this  Agreement,  a  Permitted  Financing  (as
defined  hereinafter)  shall  not  be  considered  a  Subsequent  Financing.   A
"Permitted  Financing"  shall  mean (i)  shares of Common  Stock to be issued in
connection with a strategic  merger or acquisition;  (ii) shares of Common Stock
or the  issuance of options to  purchase  shares of Common  Stock to  employees,
officers,  directors,  consultants  and vendors in accordance with the Company's
equity incentive  policies;  (iii) the issuance of securities pursuant to a bona
fide firm underwritten public offering of the Company's securities;  or (iv) the
conversion  or exercise  of  convertible  or  exercisable  securities  issued or
outstanding prior to the date hereof.

            Section  3.9 Use of  Proceeds.  The  proceeds  from  the sale of the
Shares will be used by the Company  for  working  capital and general  corporate
purposes.

            Section 3.10 Reporting Status; Eligibility to Use Form SB-2. So long
as a Purchaser beneficially owns any of the Securities, the Company shall timely
file all  reports  required  to be filed  with the  Commission  pursuant  to the
Exchange  Act,  and the  Company  shall not  terminate  its  status as an issuer
required to file reports  under the Exchange Act even if the Exchange Act or the
rules and  regulations  thereunder  would permit such  termination.  The Company
currently  meets,  and will take all necessary  action to continue to meet,  the
"registrant  eligibility"  requirements set forth in the general instructions to
Form  SB-2  applicable  to  "resale"  registrations  on  Form  SB-2  during  the

                                       17
<PAGE>

Effectiveness Period (as defined in the Registration Rights Agreement).

            Section 3.11 Disclosure of  Transaction.  The Company shall file all
documents and publicly disclose the transactions  contemplated by this Agreement
to the extent required by the Commission,  the federal  securities laws, and the
rules and  regulations  of the Exchange  Act. In addition to the  foregoing,  if
required by the rules and  regulations  of the Exchange  Act, the Company  shall
file  with  the  Commission  a  Current  Report  on Form 8-K  (the  "Form  8-K")
describing  the  material  terms of the  transactions  contemplated  hereby (and
attaching as exhibits thereto this Agreement,  the Registration Rights Agreement
and the form of  Warrant),  which Form 8-K shall be subject to prior  review and
comment by the Purchasers.

            Section  3.12  Disclosure  of  Material  Information.   The  Company
covenants  and agrees that neither it nor any other person  acting on its behalf
has  provided or will  provide any  Purchaser  or its agents or counsel with any
information  that  the  Company   believes   constitutes   material   non-public
information,  unless prior thereto such Purchaser  shall have executed a written
agreement regarding the confidentiality and use of such information. The Company
understands  and confirms that each Purchaser  shall be relying on the foregoing
representations in effecting transactions in securities of the Company.

            Section  3.13 Pledge of  Securities.  The Company  acknowledges  and
agrees that the  Securities  may be pledged by a Purchaser in connection  with a
bona fide  margin  agreement  or other  loan or  financing  arrangement  that is
secured by the Common  Stock.  The pledge of Common Stock shall not be deemed to
be a  transfer,  sale  or  assignment  of the  Common  Stock  hereunder,  and no
Purchaser  effecting  a pledge of Common  Stock shall be required to provide the
Company with any notice  thereof or  otherwise  make any delivery to the Company
pursuant to this Agreement or any other  Transaction  Document;  provided that a
Purchaser  and its pledgee  shall be required to comply with the  provisions  of
Article V hereof in order to effect a sale,  transfer  or  assignment  of Common
Stock to such pledgee. At the Purchasers'  expense, the Company hereby agrees to
execute  and deliver  such  documentation  as a pledgee of the Common  Stock may
reasonably  request  in  connection  with a pledge of the  Common  Stock to such
pledgee by a Purchaser, subject to applicable federal securities laws.

                                   ARTICLE IV

                                   CONDITIONS

            Section 4.1 Conditions Precedent to the Obligation of the Company to
Close and to Sell the  Securities.  The  obligation  hereunder of the Company to
close and issue and sell the Securities to the Purchasers at the Closing Date is
subject  to  the  satisfaction  or  waiver,  at or  before  the  Closing  of the
conditions set forth below.  These conditions are for the Company's sole benefit
and may be waived by the Company at any time in its sole discretion.

            (a) Accuracy of the Purchasers'  Representations and Warranties. The
representations  and warranties of each  Purchaser  shall be true and correct in
all  material  respects as of the date when made and as of the  Closing  Date as
though made at that time,  except for  representations  and warranties  that are

                                       18
<PAGE>

expressly made as of a particular  date,  which shall be true and correct in all
material respects as of such date.

            (b)  Performance  by  the  Purchasers.  Each  Purchaser  shall  have
performed,  satisfied and complied in all material  respects with all covenants,
agreements and conditions required by this Agreement to be performed,  satisfied
or complied with by the Purchasers at or prior to the Closing Date.

            (c) No Injunction.  No statute, rule,  regulation,  executive order,
decree,  ruling or injunction shall have been enacted,  entered,  promulgated or
endorsed by any court or governmental  authority of competent jurisdiction which
prohibits  the  consummation  of any of the  transactions  contemplated  by this
Agreement.

            (d) Delivery of Purchase  Price.  The Purchase  Price for the Shares
shall have been delivered to the Company on the Closing Date.

            (e) Delivery of Transaction  Documents.  The  Transaction  Documents
shall have been duly executed and delivered by the Purchasers to the Company.

            Section 4.2 Conditions Precedent to the Obligation of the Purchasers
to Close  and to  Purchase  the  Securities.  The  obligation  hereunder  of the
Purchasers  to  purchase  the  Securities   and   consummate  the   transactions
contemplated by this Agreement is subject to the  satisfaction or waiver,  at or
before the  Closing  Date,  of each of the  conditions  set forth  below.  These
conditions  are for the  Purchasers'  sole  benefit  and  may be  waived  by the
Purchasers at any time in their sole discretion.

            (a) Accuracy of the Company's  Representations and Warranties.  Each
of the  representations  and warranties of the Company in this Agreement and the
Registration Rights Agreement shall be true and correct in all material respects
as of the Closing Date, except for  representations and warranties that speak as
of a particular date,  which shall be true and correct in all material  respects
as of such date.

            (b)  Performance by the Company.  The Company shall have  performed,
satisfied and complied in all material  respects with all covenants,  agreements
and conditions required by this Agreement to be performed, satisfied or complied
with by the Company at or prior to the Closing Date.

            (c) No Suspension,  Etc.  Trading in the Common Stock shall not have
been  suspended  by the  Commission  or the OTC Bulletin  Board  (except for any
suspension  of trading  of  limited  duration  agreed to by the  Company,  which
suspension shall be terminated prior to the Closing),  and, at any time prior to
the Closing  Date,  trading in  securities  generally  as reported by  Bloomberg
Financial  Markets  ("Bloomberg")  shall not have been suspended or limited,  or
minimum prices shall not have been  established  on securities  whose trades are
reported by Bloomberg,  or on the New York Stock  Exchange,  nor shall a banking
moratorium  have been  declared  either by the  United  States or New York State
authorities.

            (d) No Injunction.  No statute, rule,  regulation,  executive order,
decree,  ruling or injunction shall have been enacted,  entered,  promulgated or
endorsed by any court or governmental  authority of competent jurisdiction which

                                       19
<PAGE>

prohibits  the  consummation  of any of the  transactions  contemplated  by this
Agreement.

            (e) No  Proceedings  or  Litigation.  No action,  suit or proceeding
before any arbitrator or any  governmental  authority shall have been commenced,
and no investigation  by any governmental  authority shall have been threatened,
against the Company or any  Subsidiary,  or any of the  officers,  directors  or
affiliates  of the Company or any  Subsidiary  seeking to  restrain,  prevent or
change the  transactions  contemplated by this Agreement,  or seeking damages in
connection with such transactions.

            (f) Shares and  Warrants.  At or prior to the  Closing,  the Company
shall have delivered to the Purchasers certificates  representing the Shares (in
such denominations as each Purchaser may request) and certificates  representing
the Warrants, in each case, being acquired by the Purchasers at the Closing.

            (g) Secretary's Certificate. The Company shall have delivered to the
Purchasers a  secretary's  certificate,  dated as of the Closing Date, as to (i)
the  resolutions  adopted by the Board of Directors  approving the  transactions
contemplated  hereby,  (ii) the Bylaws,  each as in effect at the  Closing,  and
(iii) the authority and incumbency of the officers of the Company  executing the
Transaction  Documents  and any  other  documents  required  to be  executed  or
delivered in connection therewith.

            (h)  Registration  Rights  Agreement.  As of the Closing  Date,  the
parties shall have entered into the Registration Rights Agreement in the form of
Exhibit C attached hereto.

            (i) Material  Adverse Effect.  No Material Adverse Effect shall have
occurred at or before the Closing Date.

                                   ARTICLE V

                               CERTIFICATE LEGEND

            Section 5.1 Legend.  Each  certificate  representing  the Securities
shall be stamped  or  otherwise  imprinted  with a legend  substantially  in the
following  form  (in  addition  to  any  legend  required  by  applicable  state
securities or "blue sky" laws):

          THE  SECURITIES   REPRESENTED  BY  THIS   CERTIFICATE   (THE
          "SECURITIES")  HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
          ACT OF 1933, AS AMENDED (THE "SECURITIES  ACT") OR ANY STATE
          SECURITIES  LAWS  AND  MAY  NOT  BE  SOLD,   TRANSFERRED  OR
          OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES
          ACT AND  UNDER  APPLICABLE  STATE  SECURITIES  LAWS OR SWISS
          MEDICA,  INC.  SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL
          THAT  REGISTRATION OF SUCH  SECURITIES  UNDER THE SECURITIES
          ACT AND UNDER THE PROVISIONS OF APPLICABLE  STATE SECURITIES
          LAWS IS NOT REQUIRED.

                                       20
<PAGE>

      The Company agrees to reissue certificates  representing any of the Shares
and the  Warrant  Shares,  without  the legend set forth  above if at such time,
prior to making any transfer of any such Shares or Warrant  Shares,  such holder
thereof shall give written notice to the Company describing the manner and terms
of such  transfer  and  removal as the  Company  may  reasonably  request.  Such
proposed  transfer and removal will not be effected  until:  (a) the Company has
notified  such holder that  either (i) in the  opinion of Company  counsel,  the
registration  of the Shares or Warrant  Shares under the  Securities  Act is not
required in  connection  with such  proposed  transfer;  or (ii) a  registration
statement  under the Securities Act covering such proposed  disposition has been
filed by the Company  with the  Commission  and has become  effective  under the
Securities Act; and (b) the Company has notified such holder that either: (i) in
the opinion of Company  counsel,  the  registration or  qualification  under the
securities  or "blue sky" laws of any state is not required in  connection  with
such proposed  disposition,  or (ii) compliance with applicable state securities
or "blue  sky" laws has been  effected.  The  Company  will  respond to any such
notice from a holder within five (5) Business  Days. In the case of any proposed
transfer  under this Section 5.1,  the Company  will use  reasonable  efforts to
comply with any such applicable  state  securities or "blue sky" laws, but shall
in no event be required,  (x) to qualify to do business in any state where it is
not then  qualified,  (y) to take any action that would  subject it to tax or to
the general service of process in any state where it is not then subject, or (z)
to  comply  with  state  securities  or "blue  sky"  laws of any state for which
registration by coordination is unavailable to the Company.  The restrictions on
transfer  contained  in this Section 5.1 shall be in addition to, and not by way
of  limitation  of, any other  restrictions  on transfer  contained in any other
section of this  Agreement.  Whenever a certificate  representing  the Shares or
Warrant Shares is required to be issued to a Purchaser without a legend, in lieu
of delivering physical  certificates  representing the Shares or Warrant Shares,
provided the Company's  transfer agent is  participating in the Depository Trust
Company ("DTC") Fast Automated  Securities  Transfer program,  the Company shall
use its best efforts to cause its transfer agent to electronically  transmit the
Shares or  Warrant  Shares to a  Purchaser  by  crediting  the  account  of such
Purchaser's  Prime  Broker  with  DTC  through  its  Deposit   Withdrawal  Agent
Commission  ("DWAC") system (to the extent not inconsistent  with any provisions
of this Agreement).

                                   ARTICLE VI

                                INDEMNIFICATION

            Section 6.1.General Indemnity.

            (a) The Company agrees to indemnify and hold harmless each Purchaser
(and its respective  directors,  officers,  affiliates,  agents,  successors and
assigns) from and against any and all losses, liabilities,  deficiencies, costs,
damages and expenses (including, without limitation, reasonable attorneys' fees,
charges and disbursements)  ("Losses") incurred by each Purchaser as a result of
any inaccuracy in or breach of the representations, warranties or covenants made
by the  Company  herein.  The  Purchasers  severally  but not  jointly  agree to
indemnify and hold harmless the Company and its directors, officers, affiliates,
agents,  successors and assigns from and against any and all Losses  incurred by
the  Company as result of any  inaccuracy  in or breach of the  representations,

                                       21
<PAGE>

warranties or covenants made by the Purchasers herein.

            (b) The Company or the Purchasers, as applicable,  shall be entitled
to indemnification under this Article VI for all Losses from the first dollar of
any Loss.  The maximum  aggregate  liability of each  Purchaser  pursuant to its
indemnification  obligations  shall not exceed the portion of the Purchase Price
paid by such Purchaser hereunder.

            Section  6.2  Indemnification   Procedure.  Any  party  entitled  to
indemnification under this Article VI (an "indemnified party") will give written
notice  to the  indemnifying  party of any  matters  giving  rise to a claim for
indemnification;   provided,   that  the  failure  of  any  party   entitled  to
indemnification  hereunder  to give notice as provided  herein shall not relieve
the  indemnifying  party of its obligations  under this Article VI except to the
extent that the  indemnifying  party is actually  prejudiced  by such failure to
give notice. In case any such action,  proceeding or claim is brought against an
indemnified party in respect of which  indemnification is sought hereunder,  the
indemnifying  party  shall be  entitled  to  participate  in and,  unless in the
reasonable  judgment of the indemnifying party a conflict of interest between it
and the  indemnified  party exists with respect to such  action,  proceeding  or
claim  (in  which  case the  indemnifying  party  shall be  responsible  for the
reasonable  fees  and  expenses  of one  separate  counsel  for the  indemnified
parties), to assume the defense thereof with counsel reasonably  satisfactory to
the  indemnified  party.  In the event that the  indemnifying  party  advises an
indemnified  party  that it will not  contest  such a claim for  indemnification
hereunder,  or fails,  within thirty (30) days of receipt of any indemnification
notice to notify, in writing,  such person of its election to defend,  settle or
compromise,  at its sole cost and expense,  any action,  proceeding or claim (or
discontinues its defense at any time after it commences such defense),  then the
indemnified party may, at its option,  defend, settle or otherwise compromise or
pay such action or claim. In any event,  unless and until the indemnifying party
elects in writing to assume  and does so assume the  defense of any such  claim,
proceeding or action, the indemnified  party's costs and expenses arising out of
the defense,  settlement or  compromise of any such action,  claim or proceeding
shall be losses subject to  indemnification  hereunder.  The  indemnified  party
shall  cooperate  fully  with  the  indemnifying  party in  connection  with any
negotiation or defense of any such action or claim by the indemnifying party and
shall furnish to the indemnifying party all information  reasonably available to
the indemnified  party which relates to such action or claim.  The  indemnifying
party shall keep the  indemnified  party  fully  apprised at all times as to the
status of the defense or any settlement  negotiations  with respect thereto.  If
the  indemnifying  party  elects to defend  any such  action or claim,  then the
indemnified  party shall be entitled to participate in such defense with counsel
of its choice at its sole cost and expense.  The indemnifying party shall not be
liable for any settlement of any action,  claim or proceeding  effected  without
its prior written  consent.  Notwithstanding  anything in this Article VI to the
contrary,  the  indemnifying  party shall not,  without the indemnified  party's
prior written consent, settle or compromise any claim or consent to entry of any
judgment  in  respect  thereof  which  imposes  any  future  obligation  on  the
indemnified party or which does not include,  as an unconditional  term thereof,
the  giving by the  claimant  or the  plaintiff  to the  indemnified  party of a
release  from all  liability  in  respect  of such  claim.  The  indemnification
required  by this  Article VI shall be made by  periodic  payments of the amount
thereof  during the course of  investigation  or defense,  as and when bills are
received or expense,  loss,  damage or  liability  is  incurred,  so long as the
indemnified party  irrevocably  agrees to refund such moneys if it is ultimately

                                       22
<PAGE>

determined by a court of competent jurisdiction that such party was not entitled
to  indemnification.  The  indemnity  agreements  contained  herein  shall be in
addition to (a) any cause of action or similar rights of the  indemnified  party
against  the  indemnifying   party  or  others,  and  (b)  any  liabilities  the
indemnifying party may be subject to pursuant to the law.

                                  ARTICLE VII

                                 MISCELLANEOUS

            Section  7.1.Fees  and  Expenses.  Each party shall pay the fees and
expenses of its advisors,  counsel,  accountants and other experts,  if any, and
all  other  expenses,  incurred  by  such  party  incident  to the  negotiation,
preparation,  execution,  delivery and performance of this Agreement,  provided,
however,  that the  Company  shall pay (i) such fees and  expenses  set forth on
Schedule  2.1(p) hereto,  (ii) one-half (1/2) of all reasonable  attorneys' fees
and expenses up to a maximum amount of $7,500  (exclusive of  disbursements  and
out-of-pocket  expenses)  incurred  by the  Purchasers  in  connection  with the
preparation, negotiation, execution and delivery of this Agreement and the other
Transaction Documents and the transactions contemplated thereunder and (iii) the
costs of any  amendments,  modifications  or waivers of this Agreement or any of
the other Transaction Documents.

            Section 7.2.Specific Performance; Consent to Jurisdiction; Venue.

            (a) The  Company  and the  Purchasers  acknowledge  and  agree  that
irreparable  damage would occur in the event that any of the  provisions of this
Agreement or the other  Transaction  Documents  were not performed in accordance
with their specific terms or were otherwise  breached.  It is accordingly agreed
that the parties shall be entitled to an injunction or injunctions to prevent or
cure  breaches of the  provisions  of this  Agreement  or the other  Transaction
Documents  and to  enforce  specifically  the  terms  and  provisions  hereof or
thereof,  this being in addition to any other remedy to which any of them may be
entitled by law or equity.

            (b) The parties agree that venue for any dispute  arising under this
Agreement  will lie  exclusively  in the state or federal  courts located in New
York  County,  New York,  and the parties  irrevocably  waive any right to raise
forum non  conveniens  or any  other  argument  that New York is not the  proper
venue. The parties irrevocably consent to personal jurisdiction in the state and
federal courts of the state of New York. The Company and each Purchaser  consent
to process being served in any such suit, action or proceeding by mailing a copy
thereof  to such party at the  address  in effect  for  notices to it under this
Agreement  and agrees that such service  shall  constitute  good and  sufficient
service of process and notice thereof.  Nothing in this Section 7.2 shall affect
or limit any right to serve  process in any other  manner  permitted by law. The
Company and the Purchasers  hereby agree that the prevailing  party in any suit,
action  or  proceeding  arising  out  of or  relating  to the  Securities,  this
Agreement  or  the  Registration   Rights   Agreement,   shall  be  entitled  to
reimbursement for reasonable legal fees from the non-prevailing party.

            Section 7.3 Entire  Agreement;  Amendment.  This  Agreement  and the
Transaction  Documents  contain the entire  understanding  and  agreement of the
parties with respect to the matters  covered hereby and,  except as specifically
set forth herein or in the other Transaction Documents,  neither the Company nor

                                       23
<PAGE>

any Purchaser make any  representation,  warranty,  covenant or undertaking with
respect  to such  matters,  and they  supersede  all  prior  understandings  and
agreements with respect to said subject matter,  all of which are merged herein.
No provision of this  Agreement may be waived or amended other than by a written
instrument signed by the Company and the Purchasers  holding at least a majority
of all Shares then held by the  Purchasers.  Any amendment or waiver effected in
accordance with this Section 7.3 shall be binding upon each Purchaser (and their
permitted assigns) and the Company.

            Section 7.4.Notices.  Any notice, demand,  request,  waiver or other
communication  required or permitted to be given  hereunder  shall be in writing
and shall be  effective  (a) upon hand  delivery by telecopy or facsimile at the
address or number designated below (if delivered on a business day during normal
business  hours where such notice is to be received),  or the first business day
following such delivery (if delivered other than on a business day during normal
business  hours  where  such  notice  is to be  received)  or (b) on the  second
business day following  the date of mailing by express  courier  service,  fully
prepaid,  addressed to such  address,  or upon actual  receipt of such  mailing,
whichever shall first occur. The addresses for such communications shall be:

If to the Company:            Swiss Medica, Inc.
                              53 Yonge Street, Third Floor
                              Toronto, Ontario, Canada M5E IJ3
                              Attention: Raghu Kilambi
                              Tel. No.: (416) 362 - 5775
                              Fax No.: (416) 868 - 6776

with copies (which copies
shall not constitute notice
to the Company) to:           Richardson & Patel, LLP
                              10900 Wilshire Boulevard, Suite 500
                              Los Angeles, California 90024
                              Attention: Kevin Friedmann, Esq.
                              Tel No.: (310) 208- 1182
                              Fax No.: (310) 208-1154

If to any  Purchaser:         At the address of such Purchaser set
                              forth on Exhibit A to this Agreement.

with copies to:               Jenkens & Gilchrist Parker Chapin LLP
                              The Chrysler Building
                              405 Lexington Ave.
                              New York, New York  10174
                              Attention: Martin Eric Weisberg, Esq.
                              Tel No.: (212) 704-6000
                              Fax No.: (212) 704-6288

      Any party  hereto may from time to time  change its address for notices by
giving written notice of such changed address to the other party hereto.

                                       24
<PAGE>

            Section 7.5  Waivers.  No waiver by either party of any default with
respect to any provision,  condition or  requirement of this Agreement  shall be
deemed  to be a  continuing  waiver  in the  future  or a  waiver  of any  other
provision,  condition or requirement  hereof, nor shall any delay or omission of
any party to exercise any right  hereunder in any manner  impair the exercise of
any such right accruing to it thereafter.

            Section 7.6 Headings.  The article,  section and subsection headings
in this  Agreement are for  convenience  only and shall not constitute a part of
this  Agreement for any other purpose and shall not be deemed to limit or affect
any of the provisions hereof.

            Section 7.7 Successors and Assigns.  This Agreement shall be binding
upon and inure to the benefit of the parties and their  successors  and assigns.
After the Closing,  the  assignment  by a party to this  Agreement of any rights
hereunder  shall not affect the  obligations of such party under this Agreement.
Subject to Section 5.1 hereof,  the Purchasers may assign the Securities and its
rights under this  Agreement and the other  Transaction  Documents and any other
rights hereto and thereto without the consent of the Company.

            Section 7.8 No Third Party Beneficiaries. This Agreement is intended
for the benefit of the parties hereto and their respective  permitted successors
and  assigns  and is not for the  benefit  of, nor may any  provision  hereof be
enforced by, any other person.

            Section 7.9 Governing Law. This  Agreement  shall be governed by and
construed in accordance with the internal laws of the State of New York, without
giving  effect to the  choice of law  provisions.  This  Agreement  shall not be
interpreted  or construed  with any  presumption  against the party causing this
Agreement to be drafted.

            Section 7.10  Survival.  The  representations  and warranties of the
Company and the Purchasers  shall survive the execution and delivery  hereof and
the Closing until the third (3rd)  anniversary  of the Closing Date,  except the
agreements  and  covenants  set forth in  Articles I, III, V, VI and VII of this
Agreement  shall  survive  the  execution  and  delivery  hereof and the Closing
hereunder.

            Section 7.11  Counterparts.  This  Agreement  may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument and shall become effective when counterparts have been signed by
each party and delivered to the other parties hereto,  it being  understood that
all parties need not sign the same counterpart.

            Section  7.12  Publicity.  The  Company  agrees  that  it  will  not
disclose,  and will not  include  in any public  announcement,  the names of the
Purchasers  without the consent of the  Purchasers,  which  consent shall not be
unreasonably  withheld  or  delayed,  or unless  and until  such  disclosure  is
required by law, rule or applicable  regulation,  and then only to the extent of
such requirement.

            Section 7.13  Severability.  The  provisions  of this  Agreement are
severable  and,  in the event  that any court of  competent  jurisdiction  shall
determine  that  any  one or more of the  provisions  or part of the  provisions
contained  in this  Agreement  shall,  for any  reason,  be held to be  invalid,
illegal  or  unenforceable  in  any  respect,  such  invalidity,  illegality  or
unenforceability  shall not affect any other provision or part of a provision of
this  Agreement  and this  Agreement  shall be reformed and construed as if such

                                       25
<PAGE>

invalid or illegal or unenforceable  provision,  or part of such provision,  had
never been contained herein,  so that such provisions would be valid,  legal and
enforceable to the maximum extent possible.

            Section  7.14  Further  Assurances.  From and after the date of this
Agreement,  upon the request of the  Purchasers or the Company,  the Company and
each Purchaser shall execute and deliver such  instruments,  documents and other
writings as may be  reasonably  necessary  or desirable to confirm and carry out
and to effectuate fully the intent and purposes of this Agreement,  the Warrants
and the Registration Rights Agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       26
<PAGE>

      IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the date first above
written.


                              SWISS MEDICA, INC.


                              By:
                                  -------------------------------------
                                  Name:  Raghu Kilambi
                                  Title: Chief Executive Officer


                              PLATINUM PARTNERS GLOBAL MACRO
                              FUND L.P.:


                              By:
                                  -------------------------------------
                                  Name:
                                  Title:


                              FENNMORE HOLDINGS:


                              By:
                                  -------------------------------------
                                  Name:
                                  Title:

<PAGE>

                                   EXHIBIT A
                               LIST OF PURCHASERS

NAMES AND ADDRESSES                                   NUMBER OF SHARES
OF PURCHASERS                                         & WARRANTS PURCHASED
-------------                                         --------------------

Platinum Partners Global Macro Fund L.P.              2,500,000 Shares
152 West 57th Street, 54th Floor                      2,500,000 Warrants
New York, New York 10019
Attention:  Mr. Frank Giorgio

Fennmore Holdings
152 West 57th Street, 54th Floor                      500,000 Shares
New York, New York 10019                              500,000 Warrants
Attention:  Mr. Frank Giorgio

                                       i
<PAGE>

                                   EXHIBIT B
                                FORM OF WARRANT

                                       ii
<PAGE>

                                   EXHIBIT C
                     FORM OF REGISTRATION RIGHTS AGREEMENT

                                      iii
<PAGE>

                                   EXHIBIT D
                      INVESTOR QUESTIONNAIRE CERTIFICATION

                               SWISS MEDICA, INC.
                       ACCREDITED INVESTOR CERTIFICATION

      PURCHASE  OF  THE   UNREGISTERED   COMMON  STOCK  AND  WARRANTS   INVOLVES
SIGNIFICANT  RISKS  AND IS A  SUITABLE  INVESTMENT  ONLY  FOR  CERTAIN  TYPES OF
POTENTIAL INVESTORS.

      The purchase of  Unregistered  Common Stock and Warrants is suitable  only
for investors who have no need for liquidity in their  investments  and who have
adequate  means of providing for their current needs and  contingencies  even if
the investment in the Unregistered  Common Stock and Warrants results in a total
loss.  Unregistered  Common Stock and Warrants will be sold only to  prospective
investors which are "accredited investors" promulgated under the Securities Act.
"Accredited   Investors"  are  those   investors   which  make  certain  written
representations  that  evidence the investor  comes within one of the  following
categories:

(INITIAL the appropriate category)


____  Any bank as defined  in Section  3(a)(2)  of the  Securities  Act,  or any
      savings and loan  association  or other  institution as defined in Section
      3(a)(5)(A) of the  Securities  Act,  whether  acting in its  individual or
      fiduciary capacity; any broker or dealer registered pursuant to Section 15
      of the Securities Exchange Act of 1934, as amended;  any insurance company
      as defined in Section 2(13) of the Securities Act; any investment  company
      registered  under the  Investment  Company Act of 1940,  as amended,  or a
      business  development  company as defined in Section 2(a)(48) of that act;
      any Small Business  Investment Company licensed by the U.S. Small Business
      Administration   under  Section  301(c)  or  (d)  of  the  Small  Business
      Investment Act of 1958, as amended; any plan established and maintained by
      a state, its political subdivisions, or any agency or instrumentality of a
      state or its political subdivisions,  for the benefit of its employees, if
      such plan has total assets in excess of  $5,000,000;  an employee  benefit
      plan within the meaning of the Employee  Retirement Income Security Act of
      1974, as amended,  if the investment decision is made by a plan fiduciary,
      as defined in Section 3(21) of such act,  which plan fiduciary is either a
      bank,  savings and loan  association,  insurance  company,  or  registered
      investment  adviser,  or if the employee  benefit plan has total assets in
      excess  of  $5,000,000  or,  if  a  self-directed  plan,  with  investment
      decisions made solely by persons that are accredited investors;

____  Any private business  development company as defined in Section 202(a)(22)
      of the Investment Advisers Act of 1940, as amended;

____  Any natural person whose individual net worth or joint net worth with that
      person's  spouse,  at the time of  investment in the  Unregistered  Common
      Stock and Warrants, exceeds $1,000,000;

                                       iv
<PAGE>

____  Any natural  person who had an individual  income in excess of $200,000 in
      each of the two most  recent  calendar  years or joint  income  with  that
      person's  spouse in excess of  $300,000  in each of those  years and has a
      reasonable  expectation  of reaching that same income level in the current
      year;

____  Any partnership or trust,  with total assets in excess of $5,000,000,  not
      formed for the specific purpose of acquiring the Unregistered Common Stock
      and  Warrants,  whose  purchase is directed by a  sophisticated  person as
      described in Rule 506(b)(2)(ii) of Regulation D and who has such knowledge
      and  experience  in financial  and business  matters that he is capable of
      evaluating the risks and merits of an investment in the units; or

____  Any entity in which all of the equity owners are accredited investors.

      As used in this Common Stock Purchase Agreement the term "net worth" means
the excess of total assets over total  liabilities.  In determining  income,  an
investor should add to his or her adjusted gross income any amounts attributable
to tax  exempt  income  received,  losses  claimed  as a limited  partner in any
limited partnership,  deductions claimed for depletion,  contributions to an IRA
or Keogh  retirement  plan,  alimony  payments  and  without any amount by which
income from  long-term  capital  gains has been  reduced in arriving at adjusted
gross income.

      The Company may make or cause to be made such  further  inquiry and obtain
such  additional  information  as  it  deems  appropriate  with  regard  to  the
suitability of prospective  investors.  The Company may reject  subscriptions in
whole or in part if, in its  discretion,  it deems such action to be in the best
interests of the Company.

      If any  information  furnished or  representations  made by a  prospective
investor or others acting on its behalf mislead the Company or the Company as to
the suitability or other  circumstances of such investor,  of if, because of any
error or misunderstanding  as to such circumstances,  a copy of the Subscription
Agreement  is delivered to any such  prospective  investor,  the delivery of the
Common Stock Purchase Agreement to such prospective investor shall not be deemed
to be an offer and the Common Stock  Purchase  Agreement must be returned to the
Company immediately.


                                          PURCHASER:


                                          By: __________________________
                                          Name: ____________________
                                          Title: ____________________

                                       v