EXHIBIT 10.10
                            CONVERTIBLE NOTE PURCHASE

                                    AGREEMENT



                           Dated as of April 23, 2002




                                      among




                                  ARMITEC, INC.




                                       and




                        THE PURCHASER LISTED ON EXHIBIT A


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                                                 TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE I     Purchase and Sale of Note........................................2
   Section 1.1   Purchase and Sale of Note.....................................2
   Section 1.2   The Conversion Shares.........................................2
   Section 1.3   Purchase Price and Closing....................................2
   Section 1.4   Warrant.......................................................3

ARTICLE II    Representations and Warranties...................................3
   Section 2.1   Representations and Warranties of the Company.................3
   Section 2.2   Representations and Warranties of the Purchaser..............13

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.........................................15
   Section 3.5   Keeping of Records and Books of Account......................16
   Section 3.6   Reporting Requirements.......................................16
   Section 3.7   Amendments...................................................16
   Section 3.8   Other Agreements.............................................16
   Section 3.9   Distributions................................................17
   Section 3.10  Reservation of Shares........................................17
   Section 3.11  Transfer Agent Instructions..................................17

ARTICLE IV    Conditions......................................................18
   Section 4.1   Conditions Precedent to the Obligation of the
                 Company to Sell the Note.....................................18

ARTICLE V     Registration Rights.............................................20

ARTICLE VI    Certificate Legend..............................................21
   Section 6.1   Legend.......................................................21

ARTICLE VII   Termination.....................................................22
   Section 7.1   Termination by Mutual Consent................................22
   Section 7.2   Other Termination............................................22
   Section 7.3   Effect of Termination........................................22

ARTICLE VIII  Indemnification.................................................22
   Section 8.1   General Indemnity............................................22
   Section 8.2   Indemnification Procedure....................................22

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                           TABLE OF CONTENTS (Cont'd)


ARTICLE IX    Miscellaneous...................................................23
   Section 9.1   Fees and Expenses............................................23
   Section 9.2   Specific Enforcement, Consent to Jurisdiction................24
   Section 9.3   Entire Agreement; Amendment..................................24
   Section 9.4   Notices......................................................25
   Section 9.5   Waivers......................................................26
   Section 9.6   Headings.....................................................26
   Section 9.7   Successors and Assigns.......................................26
   Section 9.8   No Third Party Beneficiaries.................................26
   Section 9.9   Governing Law................................................26
   Section 9.10  Survival.....................................................26
   Section 9.11  Counterparts.................................................26
   Section 9.12  Publicity....................................................26
   Section 9.13  Severability.................................................27
   Section 9.14  Further Assurances...........................................27
   Section 9.15  Remedies.....................................................28


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<PAGE>

                       CONVERTIBLE NOTE PURCHASE AGREEMENT

     This CONVERTIBLE NOTE PURCHASE  AGREEMENT (the  "Agreement") is dated as of
April 23,  2002 by and  between  Armitec,  Inc.,  a  Delaware  corporation  (the
"Company"),  and the Purchaser of the Convertible Note of the Company whose name
is set forth on Exhibit A hereto (the "Purchaser").

     The parties hereto agree as follows:

                                   ARTICLE I

                            Purchase and Sale of Note

     Section  1.1  Purchase  and Sale of  Note.  Upon the  following  terms  and
conditions,  the Company shall issue and sell to the Purchaser and the Purchaser
shall  purchase  from the  Company,  (i) a  convertible  promissory  note in the
aggregate  principal  amount of $350,000  bearing interest at the rate of 7% per
annum,  due April 23,  2004,  convertible  into shares of the  Company's  Common
Stock,  par value $.00167 per share (the "Common Stock"),  in substantially  the
form attached  hereto as Exhibit B (the "Note"),  and (ii) a Warrant to purchase
shares of the Company's Common Stock, in substantially  the form attached hereto
as Exhibit C (the  "Warrant").  The purchase  price for the Note and the Warrant
shall be $350,000  (the  "Purchase  Price").  The Company and the  Purchaser are
executing and delivering  this Agreement in accordance with and in reliance upon
the exemption from securities  registration afforded by Rule 506 of Regulation D
("Regulation  D") as  promulgated  by the United States  Securities and Exchange
Commission (the "Commission")  under the Securities Act of 1933, as amended (the
"Securities Act"), or Section 4(2) of the Securities Act.

     Section  1.2 The  Conversion  Shares.  Immediately  upon  the  filing  of a
Certificate of Amendment to the Company's  Certificate of Incorporation with the
Delaware Secretary of State increasing its authorized capital stock, the Company
shall  authorize,  reserve and  maintain,  free of  preemptive  rights and other
similar  contractual rights of stockholders,  no less than 200% of the aggregate
number of shares of Common Stock needed to effect the  conversion of the Note at
the Fixed Conversion Price (as defined in the Note) and any interest accrued and
outstanding  thereon and  exercise of the  Warrant.  Any shares of Common  Stock
issuable upon  conversion of the Note and any interest  accrued and  outstanding
thereon and  exercise of the  Warrant  (and such shares when  issued) are herein
referred to as the "Conversion  Shares" and the "Warrant Shares,"  respectively.
The  Note,  the   Conversion   Shares  and  the  Warrant  Shares  are  sometimes
collectively referred to herein as the "Shares."

     Section 1.3  Purchase  Price and Closing.  The Company  agrees to issue and
sell to the Purchaser and, in  consideration of and in express reliance upon the
representations,  warranties, covenants, terms and conditions of this Agreement,
the Purchaser agrees to purchase the Note set forth opposite its name on Exhibit
A for a purchase  price equal to $350,000.  The closing of the purchase and sale
of the Note and Warrant (the "Closing") to be acquired by the Purchaser from the
Company  under this  Agreement  shall take place at the  offices of  Naccarato &
Associates at 11:00 a.m. P.S.T. on the date on which the last to be fulfilled or

                                        2

<PAGE>

waived of the  conditions  set forth in Article IV hereof and  applicable to the
Closing shall be fulfilled or waived in  accordance  herewith or such other time
and place or on such date as the  Purchaser  and the Company may agree upon (the
"Closing Date"). On the Closing Date, the Company shall deliver to the Purchaser
the Note and the Purchaser  shall deliver to the Company the Purchase  Price. In
addition,  each party shall  deliver all  documents,  instruments  and  writings
required to be delivered by such party pursuant to this Agreement at or prior to
the Closing. This Agreement shall become effective upon the date of execution of
this Agreement by each of the parties hereto,  which date shall be no later than
April 23, 2002, unless otherwise agreed upon by the Purchaser and the Company.

     Section 1.4 Warrant. The Company agrees to issue to the Purchaser a Warrant
to purchase  3,500,000  shares of Common Stock on the Closing Date.  The Warrant
shall have an  exercise  price  equal to the  Warrant  Price (as  defined in the
Warrant) and shall expire on the fifth  anniversary of the issuance date of such
Warrant.

                                   ARTICLE II

                         Representations and Warranties

     Section 2.1  Representations  and  Warranties  of the Company.  The Company
hereby makes the following representations and warranties to the Purchaser:

         (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  except as set forth on
Schedule  2.1(g) hereto.  The Company and each such subsidiary 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  adverse  effect  on the  business,  operations,  properties,
prospects,  or financial  condition of the Company or its subsidiaries and which
is material to such entity or other  entities  controlling or controlled by such
entity.

         (b) Authorization; Enforcement. The Company has the requisite corporate
power and authority to enter into and perform this Agreement,  the  Registration
Rights  Agreement  attached  hereto  as  Exhibit  D  (the  "Registration  Rights
Agreement"),  the  Transfer  Agent  Instructions  (as  defined in Section  3..11
hereof), the Pledge Agreement,  and the Warrant (collectively,  the "Transaction
Documents") and to issue and sell the Shares in accordance with the terms hereof
and the Warrant, as applicable.  The execution,  delivery and performance of the
Transaction  Documents  by  the  Company  and  the  consummation  by it  of  the
transactions  contemplated  hereby  and  thereby  have  been  duly  and  validly
authorized  by all  necessary  corporate  action,  and  no  further  consent  or
authorization  of the  Company  or its Board of  Directors  or  stockholders  is
required.  This  Agreement  has been duly executed and delivered by the Company.
The Registration  Rights Agreement will have been duly executed and delivered by


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<PAGE>

the Company at Closing. Each of the Transaction Documents constitutes,  or shall
constitute  when executed and delivered,  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,  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. The
Company agrees to reserve 8,611,371 shares for the purchaser until the 14C Proxy
increasing the number of authorized shares is deemed effective by the Securities
and  Exchange  Commission,  at which time the  reserve  will be  adjusted to the
appropriate level.

         (c) Capitalization. The authorized capital stock of the Company and the
shares  thereof  currently  issued and  outstanding as of April 23, 2002 are set
forth on Schedule 2.1(c) hereto.  All of the outstanding shares of the Company's
Common Stock have been duly and validly authorized.  Except as set forth in this
Agreement  and the  Registration  Rights  Agreement and as set forth on Schedule
2.1(c)  hereto,  no shares of Common Stock 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 the Registration
Rights  Agreement and as set forth on Schedule  2.1(c),  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 any agreement
granting  registration or anti-dilution rights to any person with respect to any
of its equity or debt  securities.  The Company is not a party to, and it has no
knowledge of, any agreement  restricting the voting or transfer of any shares of
the capital stock of the Company. Except as set forth on Schedule 2.1(c) hereto,
the  offer  and  sale of all  capital  stock,  convertible  securities,  rights,
warrants,  or options of the Company  issued prior to the Closing  complied with
all applicable Federal and state securities laws, and no stockholder has a right
of  rescission  or damages  with  respect  thereto  which  would have a Material
Adverse Effect (as defined in Section 2.1(e) herein) on the Company's  financial
condition or operating  results.  The Company has furnished or made available to
the  Purchaser  true  and  correct  copies  of  the  Company's   Certificate  of
Incorporation  as in  effect on the date  hereof  (the  "Certificate"),  and the
Company's Bylaws as in effect on the date hereof (the "Bylaws").

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


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<PAGE>

         (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 herein and therein do not (i) violate any provision of
the Company's Certificate or Bylaws, (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 is a
party,  (iii) create or impose a lien,  charge or encumbrance on any property of
the Company  under any  agreement  or any  commitment  to which the Company is a
party or by which  the  Company  is  bound  or by  which  any of its  respective
properties  or assets are bound,  or (iv) 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
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  clause  (i)  above,  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.  The  Company is not  required  under
Federal,  state  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 Note,  the
Conversion  Shares and the Warrant Shares in accordance with the terms hereof or
thereof  (other than any filings which may be required to be made by the Company
with the Commission or state securities administrators subsequent to the Closing
or any  registration  statement  which may be filed pursuant  hereto);  provided
that, for purposes of the representation  made in this sentence,  the Company is
assuming  and relying  upon the  accuracy of the  relevant  representations  and
agreements of the Purchaser herein.

         (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 the Company has
timely filed all  reports,  schedules,  forms,  statements  and other  documents
required  to be  filed  by it with  the  Commission  pursuant  to the  reporting
requirements of the Exchange Act,  including  material filed pursuant to Section
13(a) or 15(d) of the  Exchange  Act  (all of the  foregoing  including  filings
incorporated  by reference  therein being referred to herein as the  "Commission
Documents").  The Company has delivered or made  available to the Purchaser true
and complete copies of the Commission  Documents filed with the Commission since
December 31, 2001.  The Company has not provided to the  Purchaser  any material
non-public  information or other information which, according to applicable law,
rule or regulation, should have been disclosed publicly by the Company but which
has  not  been  so  disclosed,  other  than  with  respect  to the  transactions
contemplated  by this  Agreement.  As of their  respective  dates,  the  audited
financial statements as presented in the Commission Documents for the year ended
December 31, 2001 (the "Financial Statement") and the Form 10-QSB for the fiscal
quarter ended  September 30, 2001 (the "Form  10-QSB")  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


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<PAGE>

laws,  rules and  regulations  applicable  to such  documents,  and, as of their
respective dates,  neither the Financial  Statement nor the Form 10-QSB referred
to above contained any untrue statement of a material fact or omitted 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.  The  financial  statements  of  the  Company  included  in the
Commission  Documents comply 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,
"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.  Except as set forth on Schedule
2.1(g),  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.
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  December 31,  2001,  the date
through  which the most recent  annual  report of the Company on Form 10-KSB has
been prepared and filed with the Commission,  a copy of which is included in the
Commission  Documents,  the Company has not experienced or suffered any Material
Adverse Effect.

         (i) No  Undisclosed  Liabilities.  Neither  the  Company nor any of its
subsidiaries  has  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  since December 31, 2001 and which,


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individually  or in the aggregate,  do not or would not have a Material  Adverse
Effect on the  Company  or its  subsidiaries.  Schedule  2.1(i)  sets  forth all
material liabilities.

         (j) No Undisclosed  Events or  Circumstances.  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. Schedule 2.1 (j) sets forth all material events and circumstances.

         (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 $75,000  (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,  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 $75,000 due under leases required to be capitalized in accordance with
GAAP. Except as set forth on Schedule 2.1(k) hereto, neither the Company nor any
subsidiary is in default with respect to any Indebtedness.

         (l) Title to Assets.  Except as set forth on  Schedule  2.1(l)  hereto,
each of the Company and the subsidiaries has good and marketable title to all of
its real and personal property, free of any mortgages,  pledges, charges, liens,
security  interests  or  other   encumbrances,   except  for  those  such  that,
individually or in the aggregate,  do not cause a Material Adverse Effect on the
Company's  financial  condition  or  operating  results.  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 or
proceeding  pending or, to the knowledge of the Company,  threatened against the
Company or any subsidiary  which questions the validity of this Agreement or the
transactions  contemplated  hereby or any action  taken or to be taken  pursuant
hereto or thereto. Except as set forth in the Commission Documents,  there is no
action, suit, claim, investigation or 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. Except as set forth on Schedule 2.1(m)
hereto,  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  that  would,  individually  or in the
aggregate, 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 such that,  individually or in the aggregate, do not cause a
Material  Adverse  Effect.  The  Company and each of its  subsidiaries  have all


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<PAGE>

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.  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.  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)
pending or threatened  against the Company or any subsidiary for any period, nor
of any basis for any such assessment, adjustment or contingency.

         (p) Certain Fees.  Except as set forth on Schedule  2.1(p)  hereto,  no
brokers,  finders or financial  advisory fees or commissions  will be payable by
the Company or any subsidiary or any Purchaser with respect to the  transactions
contemplated by this Agreement.

         (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  Purchaser  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.  The Company and each of the  subsidiaries
owns  or  possesses  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 and all rights with
respect to the foregoing, which are necessary for the conduct of its business as
now conducted without any conflict with the rights of others.

         (s) Environmental Compliance.  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. No material permits,  licenses and other  authorizations  have been issued
under any Environmental Laws to the Company or its subsidiaries.  "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,


                                       8
<PAGE>

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. 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.  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 may violate any  Environmental Law after the Closing or that may
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.
"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 is taken
with respect to any differences.

         (u) Material Agreements.  Except as set forth on Schedule 2.1(u) hereto
or as set forth in the  document  previously  filed  with the SEC,  neither  the
Company  nor  any  subsidiary  is a  party  to any  written  or  oral  contract,
instrument,  agreement,  commitment,  obligation, plan or arrangement, a copy of
which  would be  required  to be filed  with the  Commission  as an exhibit to a
registration  statement on Form S-1 or applicable form (collectively,  "Material
Agreements") if the Company or any subsidiary were registering  securities under
the Securities Act. The Company and each of its subsidiaries has in all material
respects performed all the obligations  required to be performed by them to date
under the foregoing  agreements,  have received no notice of default and, to the
best of the Company's  knowledge are not in default under any Material Agreement
now in effect,  the result of which could cause a Material  Adverse  Effect.  No
written or oral contract, instrument, agreement, commitment, obligation, plan or
arrangement  of the  Company  or of any  subsidiary  limits  or shall  limit the
payment of dividends on the Company's Note, its preferred  stock, if any, or its
Common Stock.


                                       9
<PAGE>

         (v) Transactions with Affiliates. Except as set forth in the Commission
Documents  and 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 exceeding $50,000 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.

         (w)  Securities  Act of 1933.  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 Note and the  Warrant  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 the Note,  the Warrant or similar
securities  to, or solicit  offers with respect  thereto from, or enter into any
preliminary  conversations or negotiations relating thereto with, any person, or
has taken or will take any  action so as to bring the  issuance  and sale of the
Note and the Warrant under the registration provisions of the Securities Act and
applicable state securities laws. 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 the Note and the
Warrant.

         (x) Governmental  Approvals.  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),
including the filing of a registration  statement or statements  pursuant to the
Registration Rights Agreement,  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
Note,  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.
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.  Since
March 31,  2001,  no officer,  consultant  or key employee of the Company or any
subsidiary whose  termination,  either  individually or in the aggregate,  could
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  Developments.  Except as set forth on Schedule
2.1(z) hereto,  since December 31, 2001,  neither the Company nor any subsidiary
has:


                                       10
<PAGE>

         (i)  issued  any  stock,  bonds or other  corporate  securities  or any
rights, options or warrants with respect thereto;

         (ii)  borrowed  any  amount  or  incurred  or  become  subject  to  any
liabilities  (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 Company's or such subsidiary's business;

         (iii)  discharged or satisfied any material lien or encumbrance or paid
any material  obligation  or  liability  (absolute  or  contingent),  other than
current liabilities paid in the ordinary course of business;

         (iv)  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 capital stock;

         (v) sold,  assigned  or  transferred  any  other  tangible  assets,  or
canceled  any  material  debts or  claims,  except  in the  ordinary  course  of
business;

         (vi) sold, assigned or transferred any patent rights, trademarks, trade
names,  copyrights,  trade secrets or other  intangible  assets or  intellectual
property rights,  or disclosed any proprietary  confidential  information to any
person  except  to  customers  in the  ordinary  course  of  business  or to the
Purchaser or its representatives;

         (vii) suffered any substantial  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;

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

         (ix) made capital expenditures or commitments  therefore that aggregate
in excess of $100,000;

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

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

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


                                       11
<PAGE>

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

         (xiv)  effected any two or more events of the  foregoing  kind which in
the aggregate would be material to the Company or its subsidiaries; or

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

         (aa) Use of Proceeds.  The  proceeds  from the sale of the Note will be
used by the Company for working capital

and general corporate purposes.

         (ab) 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 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.

         (ac) 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 issue and
sale of the Note  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 the  Purchaser,  or any person or entity that owns a
beneficial  interest in the  Purchaser,  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(ac), 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.

         (ad) Dilutive Effect. The Company understands and acknowledges that the
number of Conversion Shares issuable upon conversion of the Note and the Warrant
Shares   issuable  upon  exercise  of  the  Warrant  will  increase  in  certain
circumstances.  The Company  further  acknowledges  that its obligation to issue
Conversion  Shares upon conversion of the Note in accordance with this Agreement
and its obligations to issue the Warrant Shares upon the exercise of the Warrant
in accordance  with this Agreement and the Warrant,  is, in each case,  absolute
and unconditional  regardless of the dilutive effect that such issuance may have
on the ownership interest of other stockholders of the Company.


                                       12
<PAGE>

         (ae)Filings  Under the Act and the Exchange  Act. The Company has filed
all reports and other documents required to be filed by it under the Act and the
Exchange  Act, and no such  document,  at the time it was filed,  contained  any
untrue  statement  of a  material  fact or  omitted  to  state a  material  fact
necessary  to  make  the  statements  contained  therein,  in the  light  of the
circumstances  under  which they were made,  not  misleading.  There has been no
material change in the Company since its last filing with the Commission  except
for changes in senior management.

     Section 2.2 Representations and Warranties of the Purchaser.  The Purchaser
hereby makes the following representations and warranties to the Company:

         (a)Organization  and  Standing of the  Purchaser.  The  Purchaser  is a
corporation 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. The Purchaser has the requisite power and
authority  to enter into and perform  this  Agreement  and to purchase  the Note
being sold to it hereunder.  The  execution,  delivery and  performance  of this
Agreement  and the  Registration  Rights  Agreement  by such  Purchaser  and the
consummation by it of the transactions contemplated hereby and thereby have been
duly  authorized  by all  necessary  corporate  or  partnership  action  (if the
Purchaser  is an  entity),  and no  further  consent  or  authorization  of such
Purchaser or its Board of Directors,  stockholders, or partners, as the case may
be, is required.  Each of this Agreement and the  Registration  Rights Agreement
has been duly authorized, executed and delivered by such Purchaser.

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

         (d) Acquisition  for  Investment.  The Purchaser is purchasing the Note
and  acquiring  the  Warrant  solely  for its own  account  for the  purpose  of
investment and not with a view to or for sale in connection  with  distribution.
The Purchaser does not have a present intention to sell the Note or the Warrant,


                                       13
<PAGE>

nor a present  arrangement  (whether or not legally  binding)  or  intention  to
effect any  distribution  of the Note or the Warrant to or through any person or
entity; provided, however, that by making the representations herein and subject
to Section  2.2(f) below,  such Purchaser does not agree to hold the Note or the
Warrant for any minimum or other specific term and reserves the right to dispose
of the Note or the Warrant at any time in  accordance  with  Federal  securities
laws applicable to such disposition. Such Purchaser acknowledges that it is able
to bear the  financial  risks  associated  with an investment in the Note or the
Warrant  and that it has been given full  access to such  records of the Company
and the  subsidiaries and to the officers of the Company and the subsidiaries as
it  has  deemed   necessary  or   appropriate   to  conduct  its  due  diligence
investigation.

         (e) Accredited Purchaser.  The Purchaser is an "accredited investor" as
defined in Regulation D promulgated  under the  Securities Act and is a resident
of the jurisdiction indicated on Exhibit A hereto.

         (f) Rule 144. The  Purchaser  understands  that the Shares must be held
indefinitely  unless such Shares are  registered  under the Securities Act or an
exemption from registration is available.  Such 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 person has been  advised that Rule 144 permits  resales only under  certain
circumstances.  Such Purchaser  understands  that to the extent that Rule 144 is
not  available,  such  person will be unable to sell any Shares  without  either
registration under the Securities Act or the existence of another exemption from
such registration requirement.

         (g)  General.  Such  Purchaser  understands  that the  Shares are being
offered and sold in reliance on a transactional  exemption from the registration
requirement 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 Shares.

         (h)  Independent  Investigation;   Advertisements.  The  Purchaser,  in
offering to purchase the Note and Warrant  hereunder,  has relied solely upon an
independent  investigation  made by such Purchaser and its  representatives,  if
any, and has, prior to the date hereof, been given access to and the opportunity
to examine all books and records of the Company,  and all material contracts and
documents of the Company. In making its investment decision to purchase the Note
and Warrant, the Purchaser is not relying on any oral or written representations
or assurances from the Company or any other person or any  representation of the
Company or any other person other than as set forth in this Agreement, or on any
information  other than contained in the Company's public filings required under
the Act and the Exchange Act. The Purchaser is not  subscribing for the Note and
Warrant as a result of or subsequent to any  advertisement,  article,  notice or
other  communication  published in any  newspaper,  magazine or similar media or
broadcast over television or radio or presented at any seminar.


                                       14
<PAGE>

                                  ARTICLE III

                                    Covenants

     The Company  covenants with the Purchaser as follows,  which  covenants are
for the  benefit  of the  Purchaser  and its  permitted  assignees  (as  defined
herein).

     Section 3.1 Securities Compliance.

         (a) The Company shall notify the  Commission  in accordance  with their
rules  and  regulations,   of  the  transactions  contemplated  by  any  of  the
Transaction  Documents,  and shall take all necessary  action and proceedings as
may be required and permitted by applicable  law, rule and  regulation,  for the
legal and valid  issuance of the Note and the Warrant Shares to the Purchaser or
subsequent holders.

         (b)  The  Company  is  relying  upon  the  truth  and  accuracy  of the
representations,  warranties, agreements,  acknowledgments and understandings of
the  Purchaser  set forth  herein in order to  determine  the  applicability  of
Federal  and  state  securities  laws  exemptions  and  the  suitability  of the
Purchaser to acquire the Note.

     Section 3.2  Registration  and  Listing.  The Company will cause its Common
Stock to continue to be registered under Sections 12(b) or 12(g) of the Exchange
Act, will comply in all respects with its reporting and filing obligations under
the Exchange Act, will comply with all requirements  related to any registration
statement filed pursuant to this Agreement or the Registration Rights Agreement,
and will 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  will take all action  necessary to continue the listing or
trading of its Common Stock on the over-the-counter electronic bulletin board or
any successor market.

     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 Note or shall beneficially own any
Note, or shall own Conversion  Shares which,  in the  aggregate,  represent more
than 2% of the  total  combined  voting  power  of all  voting  securities  then
outstanding,  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 could have a Material Adverse Effect.


                                       15
<PAGE>

     Section 3.5 Keeping of Records and Books of Account. The Company shall keep
and cause each  subsidiary  to 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,  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. The Company shall furnish the following
to each  Purchaser so long as such  Purchaser  shall be  obligated  hereunder to
purchase the Note or shall  beneficially  own any Note, or shall own  Conversion
Shares which,  in the  aggregate,  represent  more than 2% of the total combined
voting power of all voting securities then outstanding,  provided, however, that
the Company  shall not be obligated to furnish the  following,  if the following
reports  have been filed by the  Company  with the  Commission  pursuant  to the
Commission's "electronic data gathering and retrieval" (EDGAR) service:

         (a) Quarterly  Reports filed with the Commission on Form 10-QSB as soon
as available, and in any event within 45 days after the end of each of the first
three (3) fiscal quarters of the Company;

         (b) Annual  Reports filed with the Commission on Form 10-KSB as soon as
available,  and in any event within 90 days after the end of each fiscal year of
the Company; and

         (c) Copies of all notices and information, including without limitation
notices and proxy statements in connection with any meetings,  that are 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 Amendments.  The Company shall not amend or waive any provision
of the Certificate or Bylaws of the Company, or Registration Rights Agreement in
any way that would  adversely  affect  the  liquidation  preferences,  dividends
rights,  conversion rights, voting rights or redemption rights of the holders of
the Note.


     Section 3.8 Other Agreements.

         (a) 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.


         (b) Future  Offerings.  Subject to the exceptions  described below, the
Company will not, without the prior written consent of a majority-in-interest of
the Buyer, not to be unreasonably withheld, negotiate or contract with any party
to obtain additional  equity financing  (including debt financing with an equity
component)  that involves any of the  following  during the period (the "Lock-up
Period")  beginning  on the  Closing  Date and  ending  on the  later of (i) two
hundred  seventy  (270) days from the Closing  Date and (ii) one hundred  eighty
(180)  days  from  the  date  the  Registration  Statement  (as  defined  in the


                                       16
<PAGE>

Registration  Rights  Agreement) is declared  effective  (plus any days in which
sales cannot be made thereunder), (A) the issuance of Common Stock at a discount
to the market  price of the Common  Stock on the date of issuance  (taking  into
account the value of any  warrants or options to acquire  Common Stock issued in
connection  therewith) or (B) the issuance of  convertible  securities  that are
convertible  into an  indeterminate  number of shares of Common Stock or (C) the
issuance of warrants.  The Capital  Raising  Limitations  shall not apply to any
transaction   involving  (i)  issuances  of  securities  in  a  firm  commitment
underwritten  public offering  (excluding a continuous offering pursuant to Rule
415 under the 1933 Act) or (ii) issuances of securities as  consideration  for a
merger, consolidation or purchase of assets, or in connection with any strategic
partnership  or joint  venture  (the  primary  purpose  of which is not to raise
equity  capital),  or in connection  with the  disposition  or  acquisition of a
business,  product or license by the Company.  The Capital  Raising  Limitations
also shall not apply to the issuance of  securities  upon exercise or conversion
of the Company's options,  warrants or other convertible  securities outstanding
as of the date hereof or to the grant of additional options or warrants,  or the
issuance of additional securities,  under any Company stock option or restricted
stock plan approved by the  Stockholders  of the Company.  In the event that the
Company  completes  a Future  Offering  on any terms more  favorable  to another
investor than the transaction  contemplated  hereby,  the terms of the Notes and
the Warrants will be amended to reflect any such more favorable terms.


     Section  3.9  Distributions.  So long as any Note remain  outstanding,  the
Company  agrees that it shall not (i) declare or pay any  dividends  or make any
distributions  to any  holder(s) of Common  Stock or (ii)  purchase or otherwise
acquire for value,  directly or  indirectly,  any Common  Stock or other  equity
security of the Company.


     Section  3.10  Reservation  of  Shares.  Immediately  upon the  filing of a
Certificate of Amendment to the Company's  Certificate of Incorporation with the
Delaware  Secretary of State increasing its authorized capital stock and so long
as any of the Notes or Warrants remain  outstanding,  the Company shall take all
action necessary to at all times have  authorized,  and reserved for the purpose
of issuance, no less than 200% of the aggregate number of shares of Common Stock
needed to provide  for the  issuance  of the  Conversion  Shares and the Warrant
Shares.

     Section  3.11  Transfer  Agent   Instructions.   The  Company  shall  issue
irrevocable  instructions  to its transfer  agent,  and any subsequent  transfer
agent,  to issue  certificates,  registered in the name of each Purchaser or its
respective nominee(s),  for the Conversion Shares and the Warrant Shares in such
amounts as  specified  from time to time by each  Purchaser  to the Company upon
conversion  of the Note or  exercise  of the  Warrant  in the form of  Exhibit E
attached hereto (the "Irrevocable Transfer Agent Instructions").  In addtion the
transfer agent shall reserve  8,611,371 shares of the Company's common stock for
the Conversion  Shares until the 14C proxy  increasing the authorized  shares is
deemed  effective by the Securities and Exchange  Commission,  at which time the
reserve shares will be adjusted to the appropriate  level. Prior to registration
of the Conversion  Shares and the Warrant  Shares under the Securities  Act, all
such certificates  shall bear the restrictive legend specified in Section 6.1 of
this  Agreement.  The  Company  warrants  that no  instruction  other  than  the
Irrevocable Transfer Agent Instructions referred to in this Section 3.11 will be


                                       17
<PAGE>

given by the Company to its transfer  agent and that the Shares shall  otherwise
be freely  transferable  on the books and  records of the  Company as and to the
extent provided in this Agreement and the Registration Rights Agreement. Nothing
in this Section 3.11 shall affect in any way each  Purchaser's  obligations  and
agreements  set forth in Section  6.1 to comply with all  applicable  prospectus
delivery  requirements,  if any,  upon  resale  of the  Shares.  If a  Purchaser
provides the Company with an opinion of counsel, in a generally acceptable form,
to the effect that a public  sale,  assignment  or transfer of the Shares may be
made without registration under the Securities Act or the Purchaser provides the
Company with reasonable  assurances that the Shares can be sold pursuant to Rule
144  without any  restriction  as to the number of  securities  acquired as of a
particular date that can then be immediately  sold, the Company shall permit the
transfer,  and, in the case of the  Conversion  Shares and the  Warrant  Shares,
promptly  instruct its transfer agent to issue one or more  certificates in such
name and in such  denominations  as specified by such  Purchaser and without any
restrictive  legend.  The  Company  acknowledges  that  a  breach  by it of  its
obligations under this Section 3.11 will cause irreparable harm to the Purchaser
by  vitiating  the intent and purpose of the  transaction  contemplated  hereby.
Accordingly, the Company acknowledges that the remedy at law for a breach of its
obligations  under this Section 3.11 will be inadequate and agrees, in the event
of a breach  or  threatened  breach by the  Company  of the  provisions  of this
Section  3.11,  that the Purchaser  shall be entitled,  in addition to all other
available  remedies,  to an order and/or  injunction  restraining any breach and
requiring  immediate  issuance and  transfer,  without the  necessity of showing
economic loss and without any bond or other security being required.

                                   ARTICLE IV

                                   Conditions

     Section 4.1  Conditions  Precedent to the Obligation of the Company to Sell
the Note. The obligation hereunder of the Company to issue and sell the Note and
the Warrant to the  Purchaser 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 Company's  sole benefit and may be waived by the Company
at any time in its sole discretion.

         (a) Accuracy of Each Purchaser's  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
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 Purchaser.  The 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 Purchaser 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


                                       18
<PAGE>

endorsed by any court or governmental  authority of competent jurisdiction which
prohibits  the  consummation  of any of the  transactions  contemplated  by this
Agreement.

     Section 4.2  Conditions  Precedent to the  Obligation  of the  Purchaser to
Purchase the Note. The obligation  hereunder of the Purchaser to acquire and pay
for the Note and the  Warrant 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  Purchaser's  sole  benefit  and  may be  waived  by the
Purchaser at any time in its sole discretion.

         (a) Accuracy of the Company's  Representations and Warranties.  Each of
the  representations  and warranties of the Company 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 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  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.  From the date  hereof to the  Closing  Date,
trading in the  Company's  Common  Stock  shall not have been  suspended  by the
Commission  (except for any suspension of trading of limited  duration agreed to
by the Company, which suspension shall be terminated prior to the Closing Date),
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, nor shall there have occurred any material
outbreak  or  escalation  of  hostilities  or other  national  or  international
calamity or crisis of such  magnitude in its effect on, or any material  adverse
change in any  financial  market  which,  in each case,  in the judgment of such
Purchaser, makes it impracticable or inadvisable to purchase the Note.

         (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
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.


                                       19
<PAGE>

         (f) Opinion of Counsel,  Etc. At the Closing,  the Purchaser shall have
received an opinion of counsel to the Company, dated the date of the Closing, in
the form of Exhibit F hereto,  and such other  certificates and documents as the
Purchaser or its counsel shall reasonably require incident to the Closing.

         (g) Registration  Rights Agreement.  At the Closing,  the Company shall
have executed and delivered the Registration Rights Agreement to each Purchaser.

         (h) Certificates. The Company shall have executed and delivered to each
Purchaser,  the  certificates  (in such  denominations  as such Purchaser  shall
request) for the Note and the Warrant being  purchased by such  Purchaser at the
Closing.

         (i)  Resolutions.  Prior to the Closing Date, the Board of Directors of
the Company shall have adopted resolutions  consistent with Section 2.1(b) above
in a form reasonably acceptable to such Purchaser (the "Resolutions").

         (j) Reservation of Shares. Immediately upon the filing of a Certificate
of Amendment to the Company's  Certificate  of  Incorporation  with the Delaware
Secretary of State  increasing its authorized  capital stock,  the Company shall
authorize, reserve and maintain out of its authorized and unissued Common Stock,
solely for the purpose of effecting the  conversion of the Note and the exercise
of the Warrant, a number of shares of Common Stock equal to at least 200% of the
aggregate  number of  Conversion  Shares  issuable  upon  conversion of the Note
outstanding on the Closing Date and the number of Warrant  Shares  issuable upon
exercise of the Warrant  assuming  such  Warrant was granted on the Closing Date
(after  giving  effect to the Note and the  Warrant to be issued on the  Closing
Date and assuming such Note and Warrant were fully convertible or exercisable on
such  date  regardless  of any  limitation  on the  timing  or  amount  of  such
conversions or exercises).

         (k)  Transfer  Agent  Instructions.   The  Irrevocable  Transfer  Agent
Instructions,  in the  form of  Exhibit  E  attached  hereto,  shall  have  been
delivered to and acknowledged in writing by the Company's transfer agent.

         (l) Secretary's  Certificate.  The Company shall have delivered to such
Purchaser a secretary's certificate, dated as of the Closing Date, as to (i) the
Resolutions,  (ii) the Certificate,  (iii) the Bylaws,  each as in effect at the
Closing,  and (iv) 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.

                                   ARTICLE V

                               Registration Rights

     At  the  Closing,  the  Company  and  the  Purchaser  shall  enter  into  a
Registration Rights Agreement in the form attached hereto as Exhibit D.


                                       20
<PAGE>

                                   ARTICLE VI

                               Certificate Legend

Section 6.1 Legend. Each certificate representing the Note and the Warrant and,
if appropriate, securities issued upon conversion and exercise thereof, 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 ARMITEC,
     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.

     The Company agrees to reissue  certificates  representing  the Note and the
Warrant, without the legend set forth above if at such time, prior to making any
transfer of any Note, Warrant,  Conversion 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 will not be effected until: (a) the Company has notified such
holder that either (i) in the opinion of Company  counsel,  the  registration of
such Note, Warrant, Conversion 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 use its best efforts to respond to any such notice from a holder  within 10
days.  In the case of any  proposed  transfer  under this Section 6, 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,  in connection therewith,
to qualify to do business in any state where it is not then qualified or 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.  The restrictions on transfer  contained
in Section 6.1 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.


                                       21
<PAGE>

                                  ARTICLE VII

                                   Termination

     Section 7.1 Termination by Mutual Consent. This Agreement may be terminated
at any time  prior to the  Closing  Date by the  mutual  written  consent of the
Company and the Purchaser.

     Section 7.2 Other  Termination.  This  Agreement  may be  terminated by the
action of the Board of Directors of the Company or by the  Purchaser at any time
if the Closing shall not have been consummated by April 17, 2002, as long as the
failure to so consummate is not the fault of the terminating party.

     Section  7.3  Effect of  Termination.  In the event of  termination  by the
Company or the Purchaser, written notice thereof shall forthwith be given to the
other  party  and  the  transactions  contemplated  by  this  Agreement  and the
Registration  Rights  Agreement  shall be terminated  without  further action by
either party.  If this Agreement is terminated as provided in Section 7.1 or 7.2
herein,  this  Agreement  shall become void and of no further  force and effect,
except for  Sections  9.1 and 9.2,  and  Article  VIII  herein.  Nothing in this
Section  7.3 shall be deemed to release the  Company or any  Purchaser  from any
liability  for any  breach  under  this  Agreement  or the  Registration  Rights
Agreement,  or to impair the rights of the Company and the  Purchaser  to compel
specific  performance by the other party of its obligations under this Agreement
and the Registration Rights Agreement.

                                  ARTICLE VIII

                                 Indemnification

     Section 8.1 General  Indemnity.  The Company  agrees to indemnify  and hold
harmless the 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 attorney's fees, charges and disbursements)  incurred by
the Purchaser as a result of any inaccuracy in or breach of the representations,
warranties or covenants  made by the Company  herein.  The  Purchaser  agrees to
indemnify and hold harmless the Company and its 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) incurred by the Company as
result of any  inaccuracy  in or breach of the  representations,  warranties  or
covenants made by the Purchaser herein.

     Section   8.2   Indemnification    Procedure.   Any   party   entitled   to
indemnification  under this  Article  VIII (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 VIII except to the


                                       22
<PAGE>

extent that the  indemnifying  party is actually  prejudiced  by such failure to
give  notice.  In case any  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 indemnified  party a conflict of interest between it
and the indemnifying party may exist with respect of such action,  proceeding or
claim, 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  contest  such a  claim  for  indemnification
hereunder,  or fails, within 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 VIII 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  VIII 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
determined by a court of competent jurisdiction that such party was not entitled
to  indemnification.  Notwithstanding  anything  in  this  Article  VIII  to the
contrary,  the  Purchaser  shall be liable under this Article VIII for only that
amount of indemnification as does not exceed the proceeds to such Purchaser as a
result of the sale of the  Conversion  Shares by the  Purchaser.  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 IX

                                  Miscellaneous

     Section 9.1 Fees and Expenses.  At the Closing, the Company shall reimburse
Buyers  for  expenses  incurred  by  it  in  connection  with  the  negotiation,
preparation, execution, delivery and performance of this Agreement and the other


                                       23
<PAGE>

agreements  to be  executed in  connection  herewith  ("Documents"),  including,
without  limitation,  attorneys' and  consultants'  fees and expenses,  transfer
agent fees, fees for stock quotation  services,  fees relating to any amendments
or  modifications  of the  Documents or any consents or waivers of provisions in
the Documents, fees for the preparation of opinions of counsel, escrow fees, and
costs of  restructuring  the  transactions  contemplated by the Documents.  When
possible,  the Company must pay these fees directly,  otherwise the Company must
make immediate payment for reimbursement to the Buyers for all fees and expenses
immediately  upon written notice by the Buyer or the submission of an invoice by
the Buyer If the Company  fails to reimburse  the Buyer in full within three (3)
business days of the written  notice or submission of invoice by the Buyer,  the
Company  shall pay  interest on the total amount of fees to be  reimbursed  at a
rate of 15% per annum.


     Section 9.2 Specific Enforcement, Consent to Jurisdiction.


         (a)  The  Company  and  the  Purchaser   acknowledge   and  agree  that
irreparable  damage would occur in the event that any of the  provisions of this
Agreement or the Registration  Rights Agreement 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  Registration  Rights
Agreement  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)  Each of the  Company  and the  Purchaser  (i)  hereby  irrevocably
submits to the  exclusive  jurisdiction  of the  United  States  District  Court
sitting  in the  Southern  District  of New York for the  purposes  of any suit,
action  or  proceeding  arising  out of or  relating  to this  Agreement  or the
Registration  Rights Agreement and (ii) hereby waives,  and agrees not to assert
in any such suit,  action or  proceeding,  any claim  that it is not  personally
subject to the jurisdiction of such court,  that the suit,  action or proceeding
is brought  in an  inconvenient  forum or that the venue of the suit,  action or
proceeding  is  improper.  Any suit,  action  or  proceeding  arising  out of or
relating to this  Agreement  or the  Registration  Rights  Agreement  brought by
either the Company or the Purchaser shall be brought in the  jurisdiction of the
United States District Court sitting in the Southern  District of New York. Each
of the Company and the  Purchaser  consents 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 9.2 shall  affect or limit any right to serve
process in any other manner permitted by law.

     Section 9.3 Entire Agreement; Amendment. This Agreement contains the entire
understanding  of the parties  with respect to the matters  covered  hereby and,
except as specifically set forth herein or in the Transaction Documents, neither
the Company nor the Purchaser makes any representations,  warranty,  covenant or
undertaking with respect to such matters.  No provision of this Agreement may be
waived or amended other than by a written  instrument  signed by the Company and
the Purchaser,  and no provision hereof may be waived other than by an a written


                                       24
<PAGE>

instrument signed by the party against whom enforcement of any such amendment or
waiver is  sought.  No  consideration  shall be offered or paid to any person to
amend or  consent to a waiver or  modification  of any  provision  of any of the
Transaction  Documents  unless the same  consideration is also offered to all of
the parties to the Transaction  Documents or holder of the Note, as the case may
be.

     Section  9.4  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 telex (with correct answer back
received),  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:                 Armitec, Inc.
                                   4479 Atlanta Road
                                   Smyrna, Georgia 30080
                                   Attention:  Chief Executive Officer
                                   Facsimile No.: (404) 842-9418

with copies (which copies
shall not constitute notice
to the Company) to:                Greenberg Traurig, LLP
                                   Attn: Robert B. Altenbach
                                   3290 Northside Parkway, Suite 400
                                   Atlanta, Georgia 30327
                                   Telephone No.: (678) 553-2100
                                   Facsimile No.: (678) 553-2188


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


with copies (which copies
shall not constitute notice
to the Company) to:                Naccarato & Associates
                                   19600 Fairchild, Suite 260
                                   Irvine, California 92618
                                   Attention: Owen M. Naccarato, Esq.
                                   Telephone No.:  (949) 851-9261
                                   Facsimile No.: (949) 851-9262

     Any party  hereto may from time to time  change its  address for notices by
giving at least ten (10) days  written  notice of such  changed  address  to the
other party hereto.


                                       25
<PAGE>

     Section 9.5 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  provisions,
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 9.6 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 9.7  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.

     Section 9.8 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  9.9  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.

     Section 9.10 Survival.  The  representations  and warranties of the Company
and  the  Purchaser   contained  in  Sections  2.1(o)  and  (s)  should  survive
indefinitely  and those  contained in Article II, with the exception of Sections
2.1(o) and (s), shall survive the execution and delivery  hereof and the Closing
until the date three (3) years from the Closing  Date,  and the  agreements  and
covenants  set forth in Article I, III,  V, VII,  VIII and IX of this  Agreement
shall survive the execution and delivery hereof and the Closing  hereunder until
the Purchaser  beneficially owns (determined in accordance with Rule 13d-3 under
the Exchange Act) less than 2% of the total combined  voting power of all voting
securities then  outstanding,  provided,  that Sections 3.1, 3.2, 3.4, 3.5, 3.7,
3.8, 3.9 and 3.12 shall not expire until the Registration  Statement required by
Section 2 of the  Registration  Rights  Agreement  is no longer  required  to be
effective under the terms and conditions of Registration Rights Agreement.

     Section 9.11 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.  In the  event  any  signature  is
delivered  by  facsimile  transmission,  the party  using such means of delivery
shall  cause  four (4)  additional  executed  signature  pages to be  physically
delivered  to the  other  parties  within  five  (5) days of the  execution  and
delivery hereof.

     Section 9.12 Publicity.  The Company agrees that it will not disclose,  and
will not include in any public  announcement,  the name of the Purchaser without


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<PAGE>

the consent of the Purchaser,  which consent shall not be unreasonably withheld,
or unless and until such disclosure is required by law or applicable regulation,
and then only to the extent of such requirement.

     Section  9.13  Severability.  The  provisions  of  this  Agreement  and the
Registration  Rights 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 or the  Registration  Rights
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 or the Registration
Rights  Agreement  shall be reformed and construed as if such 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 9.14 Further Assurances. From and after the date of this Agreement,
upon the request of the  Purchaser or the  Company,  each of the Company and the
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 Note, the
Conversion Shares, the Warrant,  the Warrant Shares and the Registration  Rights
Agreement.

     Section 9.15 Remedies.  The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Buyers by vitiating the
intent and purpose of the  transaction  contemplated  hereby.  Accordingly,  the
Company  acknowledges  that the  remedy at law for a breach  of its  obligations
under this Agreement will be inadequate and agrees,  in the event of a breach or
threatened  breach by the Company of the provisions of this Agreement,  that the
Buyers shall be entitled,  in addition to all other available remedies at law or
in equity, and in addition to the penalties  assessable herein, to an injunction
or  injunctions  restraining,  preventing or curing any breach of this Agreement
and to  enforce  specifically  the  terms and  provisions  hereof,  without  the
necessity of showing  economic loss and without any bond or other security being
required.


                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


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


                                             ARMITEC, INC.


                                             By: /s/ Bruce R. Davis
                                                --------------------------------
                                                Name:  Bruce R. Davis
                                                Title:   Chief Executive Officer



                                             STONESTREET LIMITED PARTNERSHIP


                                             By: /s/ Michael Finkelstein
                                                --------------------------------
                                                Name: Michael Finkelstein
                                                Title:



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<PAGE>

                                    EXHIBIT A

                    Purchaser / Number of Notes and Warrants


Name and Residence                 Number of Notes                 Dollar Amount
   of Purchaser                    and Warrants Purchased          of Investment
------------------                 ----------------------          -------------
Stonestreet Limited Partnership    Note: $350,000.00 Note.         $350,000.00
260 Town Center Blvd. Ste. 201     Warrant: to purchase
Markham, ON L3R 8H8                3,500,000 shares of
Fax No.: 416-956-8989              Common Stock.



                                       29
<PAGE>



                                    EXHIBIT B

                       Form of Convertible Promissory Note









                                       30
<PAGE>


                                    EXHIBIT C

                                 Form of Warrant










                                       31
<PAGE>


                                    EXHIBIT D

                      Form of Registration Rights Agreement










                                       32
<PAGE>


                                    EXHIBIT E

                       Form of Transfer Agent Instructions












                                       33
<PAGE>

                                    EXHIBIT F

                                 Form of Opinion











                                       34