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                                                                   Exhibit 10.40

                    DEBENTURE AND WARRANT PURCHASE AGREEMENT

     THIS DEBENTURE AND WARRANT PURCHASE AGREEMENT (the "Agreement") is made as
of January 31, 2003, by and among Antares Pharma, Inc., a Minnesota corporation
(the "Company"), Xmark Fund, L.P. and Xmark Fund, Ltd (collectively, the
"Investors").

                                    Recitals

     A.   The Company and the Investors previously entered into that certain
Securities Purchase Agreement, dated July 12, 2002, under which the Investors
and certain other parties purchased the Company's 10% Secured Convertible
Debentures (the "10% Convertible Debentures"); and

     B.   The Company has issued Promissory Notes (the "Xmark Fund, Ltd.
Promissory Notes") to Xmark Fund, Ltd. in the aggregate principal amount of Four
Hundred Fifty-seven Thousand Seven Hundred Fifty-seven and 47/100 Dollars
($457,757.47) and Promissory Notes (the "Xmark Fund, L.P. Promissory Notes" and
together with the Xmark Fund, Ltd. Promissory Notes, the "Promissory Notes") to
Xmark Fund, L.P. in the aggregate principal amount of One Hundred Sixty-three
Thousand Two Hundred Sixty-seven and 45/100 Dollars ($163,267.45), the proceeds
of which were used by the Company to repurchase the Company's 10% Convertible
Debentures from third party holders of such Debentures; and

     C.   The Investors have agreed to cancel the Promissory Notes in exchange
for the Company's issuance, upon the terms and conditions stated in this
Agreement, of (i) the Company's 8% Senior Secured Convertible Debentures, in the
form attached hereto as Exhibit A (the "Debentures"), having an aggregate
principal amount equal to the outstanding principal and accrued but unpaid
interest on the Promissory Notes and (ii) warrants to purchase an aggregate of
One Million Five Hundred Thousand (1,500,000) shares of the Company's common
stock, par value $.01 per share (the "Common Stock"), in the form attached
hereto as Exhibit B (the "Warrants").

     In consideration of the mutual promises made herein and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

     1.   Definitions. In addition to those terms defined above and elsewhere in
this Agreement, for the purposes of this Agreement, the following terms shall
have the meanings here set forth:

          "Affiliate" means, with respect to any Person, any other Person which,
directly or indirectly, Controls, is controlled by, or is under common Control
with, such Person.

          "Agreements" means this Agreement, the Debentures, the Warrants, the
Registration Rights Agreement (as defined in Section 3.2(a)(iv)) and the
Security Agreement.

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          "Business Day" means a day, other than a Saturday or Sunday, on which
banks in New York, New York are open for the general transaction of business.

          "Company's Knowledge" means the actual knowledge of the officers of
the Company, after due inquiry.

          "Control" means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.

          "Debenture Shares" means the shares of Common Stock issuable upon
conversion of or otherwise pursuant to the Debentures.

          "Intellectual Property" means all of the following: (i) patents,
patent applications, patent disclosures and inventions (whether or not
patentable and whether or not reduced to practice); (ii) trademarks, service
marks, trade dress, trade names, corporate names, logos, slogans and Internet
domain names, together with all goodwill associated with each of the foregoing;
(iii) copyrights and copyrightable works; (iv) registrations, applications and
renewals for any of the foregoing; (v) trade secrets, confidential information
and know-how (including, but not limited, to ideas, formulae, compositions,
manufacturing and production processes and techniques, research and development
information, drawings, specifications, designs, business and marketing plans,
and customer and supplier lists and related information); and (vi) computer
software (including, but not limited to, data, data bases and documentation).

          "Material Adverse Effect" means a material adverse effect on the
assets, liabilities, results of operations, condition (financial or otherwise),
business, or prospects of the Company and its subsidiaries taken as a whole.

          "Person" means an individual, corporation, partnership, limited
liability company, trust, business trust, association, joint stock company,
joint venture, sole proprietorship, unincorporated organization, governmental
authority or any other form of entity not specifically listed herein.

          "Securities" means the Debentures, the Debenture Shares, the Warrants
and the Warrant Shares.

          "Security Agreement" means the Amended and Restated Security
Agreement, dated as of even date herewith, by and among the Company, the
Investors and SDS Merchant Fund, L.P.

          "Warrant Shares" means the shares of Common Stock issuable upon
exercise of the Warrants.

          "1933 Act" means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.

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          "1934 Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.

     2.   Purchase and Sale of the Debenture and Warrant.

     2.1  Purchase and Sale of the Debenture and Warrant. Subject to the terms
and conditions of this Agreement, the Investors hereby agree to purchase, and
the Company hereby agrees to sell and issue to each Investor, (i) a Debenture in
the principal amount as is set forth immediately below such Investor's name on
the signature pages hereto, and (ii) a Warrant to purchase the number of shares
of Common Stock as is set forth immediately below such Investor's name on the
signature pages hereto. The purchase price due from each Investor shall be set
forth immediately below such Investor's name on the signature pages hereto (the
"Purchase Price"), which Purchase Price shall be paid by the surrender of the
Promissory Notes to the Company for cancellation. The Purchase Price shall be
allocated among the Debentures and the Warrants in the manner set forth on
Exhibit C attached hereto and incorporated by reference herein. Each of the
Company and the Investors shall file all tax returns and information reports in
a manner consistent with the allocation of the Purchase Price set forth on
Exhibit C and shall not take any action that is inconsistent with such
allocation.

     3.   Closing; Closing Deliveries; Use of Proceeds.

     3.1. Closing. The closing of the purchase and sale of the Debentures and
the Warrants (the "Closing") shall take place at the offices of the Company, or
by transmission by facsimile and overnight courier, immediately following the
execution hereof or on such later date or at such different location as the
parties shall mutually agree, but not prior to the date that the conditions set
forth in Article VI hereof have been satisfied or waived by the appropriate
party (the "Closing Date").

     3.2. Closing Deliveries. (a) On or prior to the Closing Date, the Company
shall deliver or cause to be delivered to each Investor the following:

          (i)   A Debenture, registered in the name of such Investor, in the
principal amount as is set forth immediately below such Investor's name on the
signature pages hereto;

          (ii)  A Warrant registered in the name of such Investor to purchase
the number of shares of Common Stock as is set forth on such Investor's
signature page;

          (iii) Copies of any and all consents, approvals, registrations and
waivers necessary or appropriate for consummation of the purchase and sale of
the Debentures and the Warrants, all of which shall be in full force as of the
Closing Date;

          (iv)  A Registration Rights Agreement, dated of even date herewith and
duly executed on behalf of the Company, to register the Debenture Shares and the
Warrant Shares, which Registration Rights Agreement shall be substantially in
the form attached hereto as Exhibit D (the "Registration Rights Agreement");

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          (v)   A certificate, executed on behalf of the Company by its
Secretary, dated as of the Closing Date, certifying the resolutions adopted by
the Board of Directors of the Company approving the transactions contemplated by
the Agreements and the issuance of the Debentures and the Warrants, certifying
the current versions of the Articles of Incorporation and Bylaws of the Company
and certifying as to signatures and authority of persons signing the Agreements
on behalf of the Company;

          (vi)  This Agreement, duly executed on behalf of the Company;

          (vii) An opinion of Leonard, Street and Deinard Professional
     Association, the Company's counsel, dated as of the Closing Date; and

          (vii) A letter from Jacques Gonella to the Investors, in substantially
     the form of Exhibit E attached hereto, agreeing to vote his shares of
     Common Stock in favor of the Agreements and any adjustments to the
     conversion price of the Debentures.

     (b) On or prior to the Closing Date, each Investor shall deliver to the
Company the following:

          (i)   This Agreement, duly executed on behalf of such Investor;

          (ii)  The Registration Rights Agreement, duly executed on behalf of
such Investor; and

          (iii) The Promissory Notes which shall be cancelled by the Company in
satisfaction of the Purchase Price.

     4.   Representations and Warranties of the Company.

     4.1. Organization, Good Standing and Qualification. Each of the Company and
its Subsidiaries, a complete list of which is set forth in Schedule 4.1 hereto
("Subsidiaries"), is a corporation duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its incorporation and has
all requisite corporate power and authority to carry on its business as now
conducted and own its properties. Each of the Company and its Subsidiaries is
duly qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which the conduct of its business or its ownership or
leasing of property makes such qualification or licensing necessary unless the
failure to so qualify would not have a Material Adverse Effect.

     4.2. Authorization. The Company has full power and authority and has taken
all requisite action on the part of the Company, its officers and directors
necessary for (i) the authorization, execution and delivery of the Agreements,
(ii) authorization of the performance of all obligations of the Company
hereunder or thereunder, and (iii) the authorization, issuance (or reservation
for issuance) and delivery of the Securities. The Agreements constitute the
legal, valid and binding obligations of the Company, enforceable against the
Company in accordance

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with their respective terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability,
relating to or affecting creditors' rights generally.

     4.3. Capitalization. Set forth on Schedule 4.3 hereto is (a) the authorized
capital stock of the Company on the date hereof; (b) the number of shares of
capital stock issued and outstanding; (c) the number of shares of capital stock
issuable pursuant to the Company's stock plans; and (d) the number of shares of
capital stock issuable and reserved for issuance pursuant to securities (other
than the Debentures and the Warrants) exercisable for, or convertible into or
exchangeable for, any shares of capital stock of the Company. All of the issued
and outstanding shares of the Company's capital stock have been duly authorized
and validly issued and are fully paid, nonassessable and free of pre-emptive
rights and were issued in full compliance with applicable law. Except as set
forth on Schedule 4.3, no Person is entitled to pre-emptive or similar statutory
or contractual rights with respect to any securities of the Company. Except as
set forth on Schedule 4.3, there are no outstanding warrants, options,
convertible securities or other rights, agreements or arrangements of any
character under which the Company or any of its Subsidiaries is or may be
obligated to issue any equity securities of any kind and except as contemplated
by this Agreement, neither the Company nor any of its Subsidiaries is currently
in negotiations for the issuance of any equity securities of any kind. Except as
set forth on Schedule 4.3, there are no voting agreements, buy-sell agreements,
option or right of first purchase agreements or other agreements of any kind
among any of the securityholders of the Company relating to the securities of
the Company held by them. Except as set forth on Schedule 4.3, the Company has
not granted any Person the right to require the Company to register any
securities of the Company under the 1933 Act, whether on a demand basis or in
connection with the registration of securities of the Company for its own
account or for the account of any other Person.

     4.4. Valid Issuance. The Debentures and the Warrants have been duly and
validly authorized. Upon the due conversion or exercise of the Debentures or the
Warrants, as applicable, the Debenture Shares or Warrant Shares, as applicable,
issuable upon such conversion or exercise will be validly issued, fully paid and
non-assessable, free and clear of all encumbrances and restrictions, except for
restrictions on transfer imposed by applicable securities laws. The Company has
reserved a sufficient number of shares of Common Stock for issuance upon the
conversion of the Debentures and upon exercise of the Warrants.

     4.5. Consents. The execution, delivery and performance by the Company of
the Agreements and the offer, issuance and sale of the Securities require no
consent of, action by or in respect of, or filing with, any Person, governmental
body, agency, or official other than those consents set forth on Schedule 4.5
and filings that have been made pursuant to applicable state securities laws and
post-sale filings pursuant to applicable state and federal securities laws which
the Company undertakes to file within the applicable time periods.

     4.6. No Conflict, Breach, Violation or Default. The execution, delivery and
performance of the Agreements by the Company and the issuance and sale of the
Securities will not conflict with or result in a breach or violation of any of
the terms and provisions of, or constitute a default under (i) the Company's
Articles of Incorporation or the Company's Bylaws,

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both as in effect on the date hereof (copies of which have been provided to the
Investor before the date hereof), or (ii)(a) any statute, rule, regulation or
order of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Company or any of its properties, or (b) except as
set forth on Schedule 4.6, any agreement or instrument to which the Company is a
party or by which the Company is bound or to which any of the properties of the
Company is subject.

     4.7. Delivery of SEC Filings; Business. The Company has provided the
Investors with copies of the Company's most recent Annual Report on Form 10-K,
as amended, for the fiscal year ended December 31, 2001 (the "2001 10-K"), all
other reports filed by the Company pursuant to the 1934 Act since the filing of
the 2001 10-K and prior to the date hereof and the final Prospectus, dated
October 10, 2002, filed by the Company with the Security and Exchange Commission
in connection with the Company's issuance of the 10% Convertible Debentures
(collectively, the "SEC Filings"). The Company hereby represents and warrants
that the SEC Filings are the only filings required of the Company pursuant to
the 1934 Act for such period. The Company is engaged only in the business
described in the SEC Filings and the SEC Filings contain a complete and accurate
description of the business of the Company.

     4.8. No Material Adverse Change. Since December 31, 2001, except as
identified and described in the SEC Filings or as set forth on Schedule 4.8
hereto, there has not been:

     (a) any change in the consolidated assets, liabilities, financial condition
or operating results of the Company from that reflected in the financial
statements included in the Company's most recent Quarterly Report on Form 10-Q,
except changes in the ordinary course of business which have not had, in the
aggregate, a Material Adverse Effect;

     (b) any declaration or payment of any dividend, or any authorization or
payment of any distribution, on any of the capital stock of the Company, or any
redemption or repurchase of any securities of the Company (other than the
repurchase of certain of the 10% Convertible Debentures);

     (c) any material damage, destruction or loss, whether or not covered by
insurance to any assets or properties of the Company;

     (d) any waiver by the Company of a valuable right or of a material debt
owed to it;

     (e) any satisfaction or discharge of any lien, claim or encumbrance or
payment of any obligation by the Company, except in the ordinary course of
business and which is not material to the assets, properties, financial
condition, operating results or business of the Company taken as a whole;

     (f) any change or amendment to the Company's Articles of Incorporation or
Bylaws, or material change to any material contract or arrangement by which the
Company or any of its assets or properties is bound or subject;

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     (g) any material labor difficulties or labor union organizing activities
with respect to employees of the Company;

     (h) any transaction entered into by the Company other than in the ordinary
course of business;

     (i) the loss of the services of any key employee, or material change in the
composition or duties of the Company's senior management;

     (j) the loss or threatened loss of any customer which could be material to
the Company's business; or

     (k) any other event or condition of any character that might have a
Material Adverse Effect.

     4.9. SEC Filings; Material Contracts.

     (a) At the time of filing thereof, the SEC Filings complied as to form in
all material respects with the requirements of the 1934 Act and did not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading.

     (b) During the preceding two (2) years, each registration statement and any
amendment thereto filed by the Company pursuant to the 1933 Act, as of the date
such statement or amendment became effective, complied as to form in all
material respects with the 1933 Act and did not contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading; and each prospectus
filed pursuant to Rule 424(b) under the 1933 Act, as of its issue date and as of
the closing of any sale of securities pursuant thereto did not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements made therein,
in the light of the circumstances under which they were made, not misleading.

     (c) Except as set forth on Schedule 4.9 hereto, the Company meets the
registrant requirements for use of Form S-3 set forth in General Instruction
I.A. of Form S-3. As of the Closing, the sale by the Investors of the
Registrable Securities (as defined in the Registration Rights Agreement) meets
the transaction requirements for use of Form S-3 set forth in General
Instruction I.B. of Form S-3.

     4.10. Tax Matters. The Company has timely prepared and filed all tax
returns required to have been filed by the Company with all appropriate
governmental agencies and timely paid all taxes owed by it. The charges,
accruals and reserves on the books of the Company in respect of taxes for all
fiscal periods are adequate in all material respects, and there are no material
unpaid assessments against the Company nor, to the Company's Knowledge, any
basis for the assessment of any additional taxes, penalties or interest for any
fiscal period or audits by any federal, state or local taxing authority except
for any assessment which is not

                                      -7-

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material to the Company. All taxes and other assessments and levies that the
Company is required to withhold or to collect for payment have been duly
withheld and collected and paid to the proper governmental entity or third party
when due. There are no tax liens or claims pending or, to the knowledge of the
Company, threatened against the Company or any of its respective assets or
property. There are no outstanding tax sharing agreements or other such
arrangements between the Company and any other corporation or entity.

     4.11. Title to Properties. Except as disclosed in the SEC Filings or
Schedule 4.11, the Company has good and marketable title to all real properties
and all other properties and assets owned by it, in each case free from liens,
encumbrances and defects that would materially affect the value thereof or
materially interfere with the use made or currently planned to be made thereof
by them; and except as disclosed in the SEC Filings, the Company holds any
leased real or personal property under valid and enforceable leases with no
exceptions that would materially interfere with the use made or currently
planned to be made thereof by it.

     4.12. Certificates, Authorities and Permits. The Company possesses adequate
certificates, authorities or permits issued by appropriate governmental agencies
or bodies necessary to conduct the business now operated by it and has not
received any notice of proceedings relating to the revocation or modification of
any such certificate, authority or permit that, if determined adversely to the
Company, would individually or in the aggregate have a Material Adverse Effect.

     4.13. No Labor Disputes. No material labor dispute with the employees of
the Company exists or, to the Company's Knowledge, is imminent.

     4.14. Intellectual Property.

     (a)   All Intellectual Property owned or used by the Company and/or its
Subsidiaries is currently in compliance with all legal requirements (including
timely filings, proofs and payments of fees). Except for the matters listed on
Schedule 4.14(a), all Intellectual Property owned or used by the Company and/or
its Subsidiaries is valid and enforceable. No Intellectual Property of the
Company or its Subsidiaries which is necessary for the conduct of the Company's
and each of its Subsidiaries' respective businesses as currently conducted or as
currently proposed to be conducted has been or is now involved in any
cancellation, invalidity challenge, dispute or litigation, and, to the Company's
Knowledge, no such action is threatened. Except as set forth on Schedule
4.14(a), no patent owned or used by the Company and/or its Subsidiaries has been
or is now involved in any interference, reissue, re-examination or opposition
proceeding.

     (b)   All of the licenses, sublicenses, royalty or other agreements
concerning Intellectual Property which are necessary for the conduct of the
Company's and each of its Subsidiaries' respective businesses as currently
conducted or as currently proposed to be conducted to which the Company or any
Subsidiary is a party or by which any of their assets are bound (other than
generally commercially available, non-custom, off-the-shelf software application
programs) (collectively, "License Agreements") are valid and binding obligations
of the Company or its Subsidiaries that are parties thereto and, to the
Company's Knowledge, to the

                                      -8-

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other parties thereto. The License Agreements are enforceable in accordance with
their terms, except to the extent that enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws affecting the enforcement of creditors' rights generally, and
there exists no event or condition which will result in a material violation or
breach of, or constitute (with or without due notice or lapse of time or both) a
default by the Company or any of its Subsidiaries under any such License
Agreement.

     (c) The Company and its Subsidiaries own and/or have the valid right to use
pursuant to valid and enforceable License Agreements the Intellectual Property
which is necessary for the conduct of the Company's and each of its
Subsidiaries' respective businesses as currently conducted or as currently
proposed to be conducted in all jurisdictions in which they conduct their
businesses. All Intellectual Property of the Company and its Subsidiaries that
is owned by any of the foregoing are owned free and clear of all liens,
encumbrances, adverse claims or obligations to license all such owned
Intellectual Property, other than licenses entered into in the ordinary course
of the Company's and its Subsidiaries' businesses.

     (d) The Company and each of its Subsidiaries have taken all reasonable
steps to maintain, police and protect the Intellectual Property which it owns
and/or which is necessary for the conduct of the Company's and each of its
Subsidiaries' respective businesses as currently conducted or as currently
proposed to be conducted, including the execution of appropriate confidentiality
agreements and intellectual property and work product assignments and releases.
To the Company's Knowledge, the conduct of the Company's and its Subsidiaries'
businesses as currently conducted does not infringe or otherwise impair or
conflict with (collectively, "Infringe") any Intellectual Property rights of any
third party, and the Intellectual Property rights of the Company and its
Subsidiaries which are necessary for the conduct of Company's and each of its
Subsidiaries' respective businesses as currently conducted or as currently
proposed to be conducted are not being Infringed by any third party. Except as
set forth on Schedule 4.14(d), there is no litigation or order pending or
outstanding or, to the Company's Knowledge, threatened or imminent, that seeks
to limit or challenge or that concerns the ownership, use, validity or
enforceability of any Intellectual Property of the Company and its Subsidiaries
and the Company's and its Subsidiaries' use of any Intellectual Property owned
by a third party, and, to the Company's Knowledge, there is no valid basis for
the same.

     (e) The consummation of the transactions contemplated hereby will not
result in the alteration, loss, impairment of or restriction on the Company's or
any of its Subsidiaries' ownership or right to use any of the Intellectual
Property which is necessary for the conduct of Company's and each of its
Subsidiaries' respective businesses as currently conducted or as currently
proposed to be conducted.

     (f) To the Company's Knowledge, all software owned by the Company or any of
its Subsidiaries, and, to the Company's Knowledge, all software licensed from
third parties by the Company or any of its Subsidiaries, (i) is free from any
material defect, bug, virus, or programming, design or documentation error; (ii)
operates and runs in a reasonable and efficient business manner; and (iii)
conforms in all material respects to the specifications and purposes thereof.

                                      -9-

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     (g)   The Company and its Subsidiaries have taken reasonable steps to
protect the Company's and its Subsidiaries' rights in their confidential
information and trade secrets. Each employee, consultant and contractor who has
had access to proprietary Intellectual Property which is necessary for the
conduct of Company's and each of its Subsidiaries' respective businesses as
currently conducted or as currently proposed to be conducted has executed an
agreement to maintain the confidentiality of such Intellectual Property and has
executed appropriate agreements that are substantially consistent with the
Company's standard forms thereof. Except under confidentiality obligations, to
the Company's Knowledge, there has been no material disclosure of any of the
Company's or its Subsidiaries' confidential information or trade secrets to any
third party.

     4.15. Environmental Matters. The Company is not in violation of any
statute, rule, regulation, decision or order of any governmental agency or body
or any court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or restoration of
the environment or human exposure to hazardous or toxic substances
(collectively, "Environmental Laws"), does not own or operate any real property
contaminated with any substance that is subject to any Environmental Laws, is
not liable for any off-site disposal or contamination pursuant to any
Environmental Laws, and is not subject to any claim relating to any
Environmental Laws, which violation, contamination, liability or claim would
individually or in the aggregate have a Material Adverse Effect; and the Company
is not aware of any pending investigation that might lead to such a claim.

     4.16. Litigation. Except as disclosed in the SEC Filings or on Schedule
4.16 hereto, there are no pending actions, suits or proceedings against or
affecting the Company, its Subsidiaries or any of its or their properties; and
to the Company's Knowledge, no such actions, suits or proceedings are threatened
or contemplated.

     4.17. Financial Statements. The financial statements included in each SEC
Filing fairly present the consolidated financial position of the Company as of
the dates shown and its consolidated results of operations and cash flows for
the periods shown, and such financial statements have been prepared in
conformity with United States generally accepted accounting principles applied
on a consistent basis. Except as set forth in the financial statements of the
Company included in the SEC Filings filed prior to the date hereof, the Company
has no liabilities, contingent or otherwise, except those which individually or
in the aggregate would not have a Material Adverse Effect.

     4.18. Insurance Coverage. The Company maintains in full force and effect
the insurance listed on Schedule 4.18, and the Company reasonably believes such
insurance coverage is adequate.

     4.19. Compliance with Nasdaq Continued Listing Requirements. The Company is
in compliance with all applicable Nasdaq SmallCap Market continued listing
requirements. Except as provided in Schedule 4.19, there are no proceedings
pending or to the Company's Knowledge threatened against the Company relating to
the continued listing of the Company's Common Stock on the Nasdaq SmallCap
Market and the Company has not received any notice of, nor to

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the Company's Knowledge is there any basis for, the delisting of the Common
Stock from the Nasdaq SmallCap Market.

     4.20. Brokers and Finders. Except as set forth on Schedule 4.20, the
Investors shall have no liability or responsibility for the payment of any
commission or finder's fee to any third party in connection with or resulting
from this Agreement or the transactions contemplated by this Agreement by reason
of any agreement of or action taken by the Company.

     4.21. No Directed Selling Efforts or General Solicitation; Exemption from
Registration. Neither the Company nor any Person acting on its behalf has
conducted any general solicitation or general advertising (as those terms are
used in Regulation D) in connection with the offer or sale of any of the
Securities. Subject to the accuracy and completeness of the representations and
warranties of the respective Investors contained in Article V hereof, the offer,
sale and issuance by the Company to the Investors of the Securities are exempt
from the registration requirements of the 1933 Act.

     4.22. No Integrated Offering. Neither the Company nor any of its
Affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would adversely affect reliance by
the Company on Section 4(2) for the exemption from registration for the
transactions contemplated hereby or would require registration of the Securities
under the 1933 Act.

     4.23. Questionable Payments. Neither the Company nor any of its
Subsidiaries nor, to the Company's Knowledge, any of their respective current or
former shareholders, directors, officers, employees, agents or other Persons
acting on behalf of the Company or any Subsidiary, has on behalf of the Company
or any Subsidiary or in connection with their respective businesses: (a) used
any corporate funds for unlawful contributions, gifts, entertainment or other
unlawful expenses relating to political activity; (b) made any direct or
indirect unlawful payments to any governmental officials or employees from
corporate funds; (c) established or maintained any unlawful or unrecorded fund
of corporate monies or other assets; (d) made any false or fictitious entries on
the books and records of the Company; or (e) made any unlawful bribe, rebate,
payoff, influence payment, kickback or other unlawful payment of any nature.

     4.24. Disclosures. Neither the Agreements (including any schedules or
exhibits attached hereto or thereto) nor the SEC Filings contain any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained therein not misleading in light of the
circumstances under which they were made. There is no fact known to the Company
that the Company has not disclosed to the Investors which has had or which could
be expected to have a Material Adverse Effect on the Company.

     5.    Representations and Warranties of the Investors. Each of the
Investors hereby severally, and not jointly, represents and warrants to the
Company that:

     5.1.  Authorization. The execution, delivery and performance by the
Investor of the Agreements to which it is a party have been duly authorized by
the Investor and each of the

                                      -11-

<PAGE>

Agreements will constitute the valid and legally binding obligation of the
Investor, enforceable against the Investor in accordance with their respective
terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability, relating to or affecting
creditors' rights generally.

     5.2. Purchase Entirely for Own Account. The Securities to be received by
the Investor hereunder will be acquired for the Investor's own account, not as
nominee or agent, and not with a view to the resale or distribution of any part
thereof, and the Investor has no present intention of selling, granting any
participation in, or otherwise distributing the same. The Investor is not a
registered broker dealer or entity engaged in the business of being a broker
dealer.

     5.3. Investment Experience. The Investor acknowledges that it can bear the
economic risk and complete loss of its investment in the Securities and has such
knowledge and experience in financial or business matters that it is capable of
evaluating the merits and risks of the investment contemplated hereby.

     5.4. Disclosure of Information. The Investor has had an opportunity to
receive documents related to the Company and to ask questions of and receive
answers from the Company regarding the Company, its business and the terms and
conditions of the offering of the Securities. Neither such inquiries nor any
other due diligence investigation conducted by the Investor shall modify, amend
or affect the Investor's right to rely on the Company's representations and
warranties contained in this Agreement.

     5.5. Restricted Securities. The Investor understands that the Securities
are characterized as "restricted securities" under the federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under such laws and applicable regulations
such securities may be resold without registration under the 1933 Act only in
certain limited circumstances.

     5.6. Legends. It is understood that, until the earlier of (i) registration
for resale pursuant to the Registration Rights Agreement, or (ii) the time when
such Securities may be sold pursuant to Rule 144(k) of the 1933 Act,
certificates evidencing such Securities may bear the following or any similar
legends:

     (a)  "The securities represented hereby may not be transferred unless (i)
such securities have been registered for sale pursuant to the 1933 Act, as
amended, (ii) such securities may be sold pursuant to Rule 144(k) of the 1933
Act, or (iii) the Company has received an opinion of counsel satisfactory to it
that such transfer may lawfully be made without registration under the 1933 Act
or qualification under applicable state securities laws."

     (b)  If required by the authorities of any state in connection with the
issuance or sale of the Securities, the legend required by such state authority.

          Upon the earlier of (i) registration for resale pursuant to the
Registration Rights Agreement or (ii) Rule 144(k) of the 1933 Act becoming
available, the Company shall, upon the Investor's written request, promptly
cause certificates evidencing the Securities to be replaced

                                      -12-

<PAGE>

with certificates which do not bear such restrictive legends, and Debenture
Shares or Warrant Shares, as applicable, subsequently issued in respect of the
Debentures or Warrants, as applicable, shall not bear such restrictive legends
provided the provisions of either clause (i) or clause (ii) above, as
applicable, are satisfied with respect to such Debenture Shares or Warrant
Shares.

     5.7. Accredited Investor. The Investor is an accredited investor as defined
in Rule 501(a) of Regulation D, as amended, under the 1933 Act.

     5.8. No General Solicitation. The Investor did not learn of the investment
in the Securities as a result of any public advertising or general solicitation.

     5.9. Brokers and Finders. No Person will have, as a result of the
transactions contemplated by this Agreement, any valid right, interest or claim
against or upon the Company, any Subsidiary or another Investor for any
commission, fee or other compensation pursuant to any agreement, arrangement or
understanding entered into by or on behalf of the Investor.

     6.   Closing Conditions.

     6.1. Investor's Conditions to Closing. The obligation of the Investors to
purchase the Debentures and the Warrants at the Closing is subject to the
fulfillment to each Investor's satisfaction, on or prior to the Closing Date, of
the following conditions, any of which may be waived by the Investors:

     (a)  The representations and warranties made by the Company in Article IV
hereof shall be true and correct in all respects on the Closing Date. The
Company shall have performed in all material respects all obligations and
conditions herein required to be performed or observed by it on or prior to the
Closing Date.

     (b)  The Company shall have delivered to the Investors all of the closing
deliveries specified in Section 3.2(a) hereof.

     (c)  No judgment, writ, order, injunction, award or decree of or by any
court, or judge, justice or magistrate, including any bankruptcy court or judge,
or any order of or by any governmental authority, shall have been issued, and no
action or proceeding shall have been instituted by any governmental authority,
enjoining or preventing the consummation of the transactions contemplated hereby
or in the other Agreements.

     (d)  The Company shall have executed and delivered such other documents as
the Investors may reasonably request.

     6.2. Company's Conditions to Closing. The Company's obligation to sell and
issue the Debentures and the Warrants at the Closing is subject to the
fulfillment to the satisfaction of the Company on or prior to the Closing Date
of the following conditions, any of which may be waived by the Company:

                                      -13-

<PAGE>

     (a)  The representations and warranties made by the Investors in Article V
hereof shall be true and correct in all respects as of the Closing Date. The
Investors shall have performed in all material respects all obligations and
conditions herein required to be performed or observed by them on or prior to
the Closing Date.

     (b)  The Investors shall have delivered to the Company all of the closing
deliveries specified in Section 3.2(b) hereof.

     (c)  No judgment, writ, order, injunction, award or decree of or by any
court, or judge, justice or magistrate, including any bankruptcy court or judge,
or any order of or by any governmental authority, shall have been issued, and no
action or proceeding shall have been instituted by any governmental authority,
enjoining or preventing the consummation of the transactions contemplated hereby
or in the other Agreements.

     (d)  The Investors shall have executed and delivered such other documents
as the Company may reasonably request.

     7.   Covenants and Agreements of the Company.

     7.1. Reservation of Common Stock. The Company shall at all times reserve
and keep available out of its authorized but unissued shares of Common Stock,
solely for the purpose of providing for the conversion of the Debentures and the
exercise of the Warrants, such number of shares of Common Stock as shall from
time to time equal the number of shares sufficient to permit the conversion of
the Debentures and the exercise of the Warrants in accordance with their
respective terms.

     7.2. Compliance with Laws. So long as the Investors beneficially own any
Securities, the Company will use reasonable efforts to comply with all
applicable laws, rules, regulations, orders and decrees of all governmental
authorities, except to the extent non-compliance (in one instance or in the
aggregate) would not have a Material Adverse Effect.

     7.3. Listing of Underlying Shares and Related Matters. The Company hereby
agrees, promptly following the Closing of the transactions contemplated by the
Agreements, to take such action to cause the Debenture Shares and the Warrant
Shares to be listed on the Nasdaq SmallCap Market as promptly as possible but no
later than the effective date of the registration contemplated by the
Registration Rights Agreement. The Company further agrees that if the Company
applies to have its Common Stock or other securities traded on any other
principal stock exchange or market, it will include in such application the
Debenture Shares and the Warrant Shares and will take such other action as is
necessary to cause such Common Stock to be so listed. For so long as the
Investors beneficially own any of the Securities, the Company will take all
action necessary to continue the listing and trading of its Common Stock on the
Nasdaq SmallCap Market and will comply in all respects with the Company's
reporting, filing and other obligations under the bylaws or rules of such
exchange, as applicable, to ensure the continued eligibility for trading of the
Debenture Shares and the Warrant Shares thereon.

     7.4. Corporate Existence. So long as the Investors beneficially own any of
the Securities, the Company shall maintain its corporate existence, except in
the event of a merger,

                                      -14-

<PAGE>

consolidation or sale of all or substantially all of the Company's assets, as
long as the surviving or successor entity in such transaction (a) assumes the
Company's obligations hereunder and under the other Agreements, regardless of
whether or not the Company would have had a sufficient number of shares of
Common Stock authorized and available for issuance in order to fulfill its
obligations hereunder and effect the conversion or exercise in full, as
applicable, of the Debentures and Warrants outstanding as of the date of such
transaction; (b) has no legal, contractual or other restrictions on its ability
to perform the obligations of the Company hereunder and under the other
Agreements; and (c) is a publicly traded corporation whose common stock and the
shares of capital stock issuable upon conversion of the Debentures and the
exercise of the Warrants are (or would be upon issuance thereof) listed for
trading on the Nasdaq National Market, the Nasdaq Small Cap Market, the New York
Stock Exchange or the American Stock Exchange.

     7.5 Right to Participate. For a period of two (2) years following the date
hereof, in the event the Company offers for sale any of its equity securities,
or any securities that are convertible into or exercisable for the Company's
equity securities (a "Proposed Sale"), the Company shall provide written notice
of such Proposed Sale to the Investors (which notice shall include the price,
the other terms and conditions of the Proposed Sale, the name of the proposed
purchaser and a copy of the term sheet, if any, for such Proposed Sale), and the
Investors shall have the right to participate in the Proposed Sale in an amount
equal to the Investor' pro rata share of the Company's then-outstanding Common
Stock, such pro rata share being determined as if the Debentures and the
Warrants issued to the Investors pursuant hereto were fully converted and
exercised (the "Right to Participate"). Within five (5) business days following
receipt of the written notice from the Company of Proposed Sale, the Investors
shall provide written notice to the Company indicating whether the Investors
intend to exercise their Right to Participate in the Proposed Sale. The
Investors' Right to Participate shall not apply to any issuance of Common Stock
or preferred stock to (i) the Company's employees, officers, directors or
consultants pursuant to stock purchase or stock option plans approved by a
majority of the independent members of the Company's Board of Directors, (ii)
lenders and equipment lessors in connection with a financing arrangement with
the Company, (iii) marketing or investor relations firms, if the primary purpose
of such issuance is not to raise equity capital, (iv) any non-affiliated third
party as consideration for a merger or consolidation with, or purchase of assets
from, such non-affiliated third party, or (v) to a non-affiliated third party in
connection with any strategic partnership or joint venture with such
non-affiliated third party with which the Company will enter into technology
agreements (the primary purpose of which is not to raise equity capital).

     7.6. Reports. For so long as the Investors beneficially own any of the
Securities, the Company will notify the Investors in writing (which notice may
be delivered by electronic mail and which notice shall be accompanied by a
summary description of any items specified in Section 7.6(c)) of the following
reports (within one week of filing with the SEC, in the case of SEC filings),
and shall promptly furnish to the Investors any such reports which are not filed
electronically with the SEC:

     (a)  Quarterly Reports. The Company's Quarterly Report on Form 10-Q or, in
the absence of such report, consolidated balance sheets of the Company as at the
end of such period and the related consolidated statements of operations,
shareholders' equity and cash flows for

                                      -15-

<PAGE>

such period and for the portion of the Company's fiscal year ended on the last
day of such quarter, all in reasonable detail and certified by a principal
financial officer of the Company to have been prepared in accordance with
generally accepted accounting principles in the United States, subject to
year-end and audit adjustments.

         (b)  Annual Reports. The Company's Annual Report on Form 10-K or, in
the absence of a Form 10-K, consolidated balance sheets of the Company as of the
end of such year and the related consolidated statements of earnings,
shareholders' equity and cash flows for such year, all in reasonable detail and
accompanied by the report on such consolidated financial statements of an
independent certified public accountant selected by the Company.

         (c)  Securities Filings. Copies of (i) all notices, proxy statements,
financial statements, reports and documents as the Company shall send or make
available generally to its shareholders or to financial analysts, promptly after
providing same to the shareholders or financial analysts and (ii) all periodic
and special reports, documents and registration statements (other than on Form
S-8) which the Company furnishes to or files, or any officer or director of the
Company (in such person's capacity as such) furnishes to or files, with the SEC.

         (d)  Other Information. Such other information relating to the Company
as from time to time may reasonably be requested by the Investors, provided the
Company produces such information in its ordinary course of business, and
further provided that the Company, solely in its own discretion, determines that
such information is not confidential in nature and disclosure to the Investors
would not be harmful to the Company.

         7.7  Shareholder Approval. If shareholder approval of the Agreements
and the transactions contemplated hereunder and thereunder (including, without
limitation, the issuance of shares of Common Stock in excess of the Issuable
Maximum (as defined in the Debentures)) is required by the applicable rules and
regulations of the Nasdaq SmallCap Market (or any successor entity), the Company
shall, as soon as possible, but in no event later than ninety (90) days from the
date hereof, obtain shareholder approval of the Agreements and the transactions
contemplated hereunder and thereunder.

         8.   Survival and Indemnification.

         8.1. Survival. All representations, warranties, covenants and
agreements contained in this Agreement shall be deemed to be representations,
warranties, covenants and agreements as of the date hereof and shall survive the
execution and delivery of this Agreement for a period of three (3) years from
the date of this Agreement; provided, however, that the provisions contained in
Section 7 hereof shall survive in accordance therewith.

         8.2. Company Indemnification. The Company agrees to indemnify and hold
harmless, on an after-tax and after insurance recovery basis, each holder of
Securities and its Affiliates and their respective directors, officers,
employees and agents from and against any and all losses, claims, damages,
liabilities and expenses (including, without limitation, reasonable attorney
fees and disbursements and other reasonable expenses incurred in connection with
investigating, preparing or defending any action, claim or proceeding, pending
or threatened and the costs of

                                      -16-

<PAGE>

enforcement hereof) (collectively, "Losses") to which such Person may become
subject as a result of a breach of any representation, warranty, covenant or
agreement made by or to be performed on the part of the Company under the
Agreements or otherwise resulting from any action, claim or proceeding arising
out of the matters or transactions contemplated by the Agreements, and will
reimburse any such Person for all such amounts as they are incurred by such
Person.

     8.3. Investor Indemnification. Each Investor agrees to, severally but not
jointly, indemnify and hold harmless, on an after-tax and after insurance
recovery basis, the Company and its directors, officers, employees and agents
from and against any and all Losses to which such Person may become subject as a
result of a breach of any representation, warranty, covenant or agreement made
by or to be performed on the part of such Investor under the Agreements, and
will reimburse any such Person for all such amounts as they are incurred by such
Person; provided, however, under no circumstances shall this Section 8.3 be
deemed to increase the indemnification and/or contribution obligations of such
Investor under the Registration Rights Agreement which is subject to the cap
provided therein.

     8.4. Conduct of Indemnification Proceedings. Promptly after receipt by any
Person (the "Indemnified Person") of notice of any demand, claim or
circumstances which would or might give rise to a claim or the commencement of
any action, proceeding or investigation in respect of which indemnity may be
sought pursuant to Section 8.2 or Section 8.3, such Indemnified Person shall
promptly notify in writing the party from whom indemnification is sought (the
"Indemnifying Person") and the Indemnifying Person shall assume the defense
thereof, including the employment of counsel reasonably satisfactory to such
Indemnified Person, and shall assume the payment of all fees and expenses;
provided, however, that the failure of any Indemnified Person so to notify the
Indemnifying Person shall not relieve the Indemnifying Person of its obligations
hereunder except to the extent that the Indemnifying Person is materially
prejudiced by such failure to notify. In any such proceeding, any Indemnified
Person shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Person unless: (i)
the Indemnifying Person and the Indemnified Person shall have mutually agreed to
the retention of such counsel; or (ii) in the reasonable judgment of such
Indemnified Person representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. The
Indemnifying Person shall not be liable for any settlement of any proceeding
effected without its written consent, which consent shall not be unreasonably
withheld, but if settled with such consent, or if there be a final judgment for
the plaintiff, the Indemnifying Person shall indemnify and hold harmless such
Indemnified Person from and against any loss or liability (to the extent stated
above) by reason of such settlement or judgment. Without the prior written
consent of the Indemnified Person, the Indemnifying Person shall not effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Person is or could have been a party and indemnity could have been
sought hereunder by such Indemnified Party, unless such settlement includes an
unconditional release of such Indemnified Person from all liability arising out
of such proceeding.

                                      -17-

<PAGE>

     9.   Miscellaneous.

     9.1. Successors and Assigns. This Agreement may not be assigned by a party
hereto without the prior written consent of the other party hereto, except that
without the prior written consent of the Company, but after notice duly given,
the Investors may, subject to compliance with applicable federal and state
securities laws, assign their rights and delegate their duties hereunder in
whole or in part to an Affiliate or to a third party acquiring some portion or
all of his Securities in a private transaction. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
permitted successors and assigns of the parties. Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.

     9.2. Counterparts; Faxes. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Agreement may also
be executed via facsimile, which shall be deemed an original.

     9.3. Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in construing or
interpreting this Agreement.

     9.4. Notices. Unless otherwise provided, any notice required or permitted
under this Agreement shall be given in writing and shall be deemed effectively
given only upon delivery to each party to be notified by (i) personal delivery,
(ii) telex or telecopier, upon receipt of confirmation of complete transmittal,
or (iii) a nationally recognized overnight air courier, addressed to the party
to be notified at the address as follows, or at such other address as such party
may designate by ten (10) days' advance written notice to the other party:

          If to the Company:

          Antares Pharma, Inc.
          707 Eagle View Boulevard
          Suite 414
          Exton, PA 19341
          Attention: Roger G. Harrison
          Fax: (610) 458-0756

          with a copy to:

          Morris M. Sherman, Esq.
          Leonard, Street and Deinard Professional Association
          150 South 5/th/ Street, Suite 2300
          Minneapolis, MN 55402
          Fax: (612) 335-1657

                                      -18-

<PAGE>

          If to the Investors, to the address listed below such Investor's name
on the signature pages hereto.

     9.5. Amendments and Waivers. Any term of this Agreement may be amended and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), only with
the written consent of the Company and the Investors. Any amendment or waiver
effected in accordance with this paragraph shall be binding upon each holder of
any Securities purchased under this Agreement at the time outstanding, each
future holder of all such Securities, and the Company.

     9.6. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof but shall be interpreted as if it were written so as
to be enforceable to the maximum extent permitted by applicable law, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereby waive any provision of law which
renders any provisions hereof prohibited or unenforceable in any respect.

     9.7. Entire Agreement. This Agreement, including the Exhibits and Schedules
hereto, and the other Agreements constitute the entire agreement among the
parties hereof with respect to the subject matter hereof and thereof and
supersede all prior agreements and understandings, both oral and written,
between the parties with respect to the subject matter hereof and thereof.

     9.8. Further Assurances. The parties shall execute and deliver all such
further instruments and documents and take all such other actions as may
reasonably be required to carry out the transactions contemplated hereby and to
evidence the fulfillment of the agreements herein contained.

     9.9. Applicable Law; Jurisdiction and Venue. This Agreement, and all
matters arising directly or indirectly hereunder, shall be governed by, and
construed in accordance with, the laws of the State of New York without regard
to principles of conflicts of laws. The Company and the Investors hereby (a)
irrevocably consent and submit to the sole exclusive jurisdiction of the state
and federal courts located in New York in connection with any suit, action or
other proceeding directly or indirectly arising out of or relating to this
Agreement, and (b) irrevocably waive, to the fullest extent permitted by law,
any objection that any of them may now or hereafter have to the laying of the
venue of any such suit, action or proceeding in any such court or that any such
suit, action or proceeding which is brought in any such court has been brought
in an inconvenient forum.

     9.10 Legal Fees. The Company shall pay the legal expenses of the Investors
incurred in connection with the preparation and execution of the Agreements, up
to a maximum of $25,000.00. If requested by the Company, the Investors shall
provide adequate documentation of those legal expenses for which the Investors
are seeking reimbursement from the Company.

                                      -19-

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute and deliver this Agreement as of the date first above
written.

The Company:                                   ANTARES PHARMA, INC.



                                               By:    /s/ Lawrence M. Christian
                                                  ------------------------------
                                               Name:  Lawrence M. Christian
                                               Title:  Chief Financial Officer

                                      -20-

<PAGE>

XMARK FUND, L.P.
By:

       /s/ David C. Cavalier
--------------------------------------
David C. Cavalier
Chief Operating Officer

ADDRESS:  152 West 57th Street, 21st Floor
          New York, NY 10019
          Facsimile: (212) 247-1329
          Telephone: (212) 247-8200


    Purchase Price                                                   $163,267.45

    Aggregate Principal Amount of Debentures:                        $163,267.45
    Number of shares of Common Stock underlying Warrant                  394,350

                                      -21-

<PAGE>

XMARK FUND, LTD.

      /s/ David C. Cavalier
---------------------------------------
David C. Cavalier
Chief Operating Officer

ADDRESS:  152 West 57th Street, 21st Floor
          New York, NY 10019
          Facsimile: (212) 247-1329
          Telephone: (212) 247-8200


    Purchase Price                                                   $457,757.47

    Aggregate Principal Amount of Debentures:                        $457,757.47
    Number of shares of Common Stock underlying Warrant                1,105,650

                                      -22-