Exhibit 10.2

         THIS WARRANT AND THE  SECURITIES  REPRESENTED  BY THIS WARRANT HAVE NOT
         BEEN REGISTERED  UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES ACT
         OF ANY  STATE  AND MAY NOT BE SOLD OR  TRANSFERRED  UNLESS  THERE IS AN
         EFFECTIVE  REGISTRATION STATEMENT UNDER SUCH ACTS COVERING THIS WARRANT
         AND THE  SECURITIES  REPRESENTED  BY THIS  WARRANT  OR  PURSUANT  TO AN
         EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF
         SUCH ACTS.


                               NUWAY MEDICAL, INC.

                        WARRANT TO PURCHASE COMMON STOCK

                                  June 10, 2003

WARRANT NO. AG-1


         THIS CERTIFIES THAT, for value  received,  AUGUSTINE II, LLC, a limited
liability company formed under the laws of the State of Delaware (the "Holder"),
is  entitled  to  subscribe  for  and  purchase  from  NUWAY  MEDICAL,  INC.,  a
corporation  organized under the laws of the state of Delaware (the  "Company"),
commencing  at the time  periods  prescribed  herein  and  ending  at 5:00  p.m.
Chicago,  Illinois  time on the fifth  (5th)  calendar  anniversary  of the date
hereof, 6,158,381 shares (the "Shares") of common stock, par value, $0.00067, of
the Company (the "Common  Stock").  The exercise price for each Share subject to
this Warrant (the "Warrant  Price") is equal to $0.16.  The number of Shares and
the  Warrant  Price are subject to  adjustment  from time to time as provided in
Section 5 of this  Warrant,  however  the  number of shares  that are  issued or
potentially  issued to the Holder  shall  never be equal to or exceed 20% of the
issued and outstanding common shares as of the date of this agreement,  which is
equal to 30,791,911.

         This Warrant is issued in connection with and as consideration  for the
funds  received  by the Company set forth on the face of the Term Note dated the
date hereof and issued by the  Company in favor of the  Holder,  which Term Note
has been issued  pursuant to that  certain  Term Loan  Agreement  dated the date
hereof between the Company and the Holder.  Three million six hundred sixty-five
thousand seven hundred three  (3,665,703)  warrants are exercisable upon funding
by Holder of the first  installment  pursuant  to the Term Loan  Agreement.  One
million four hundred sixty-six thousand two hundred eighty-one (1,466,281) shall
not be exercisable  unless and until the Holder funds the second  installment of
$100,000  pursuant to the Term Loan Agreement (it being understood that in event
that the  Holder  fails  to fund  the  installment  required  by the  Term  Loan
Agreement  within ten (10) days following the funding date  prescribed  therein,
the right to exercise this warrant in relation to such shares is cancelled). The
balance  of  the  warrants  (one  million  twenty-six   thousand  three  hundred
ninety-seven  (1,026,397))  shall not be exercisable  until the Holder funds the
final installment  pursuant to the Term Loan Agreement (it being understood that
in event that the Holder fails to fund the installment required by the Term Loan
Agreement  within ten (10) days following the funding date  prescribed  therein,
the right to exercise this warrant in relation to such shares is cancelled).

         1. Method of Exercise;  Payment;  Issuance of New Warrant. The purchase
right represented by this Warrant may be exercised by the Holder, in whole or in
part,  subject to the limitation set forth below,  and from time to time, by (i)
the  surrender of this Warrant  (with a notice of exercise in the form  attached
hereto as Exhibit A, duly  executed) at the principal  office of the Company and

<PAGE>

(ii) the  payment  to the  Company,  by check  or wire  transfer  of funds to an
account specified in writing by the Company, of an amount equal to the aggregate
Warrant Price  (provided,  however,  this clause (ii) shall not be applicable if
the Holder is making a cashless exercise pursuant to Section 2 of this Warrant).
The Shares so purchased,  representing  the aggregate number of shares specified
in the executed  Exhibit A, shall be delivered to the Holder within a reasonable
time, not exceeding  five (5) business days,  after this Warrant shall have been
so  exercised.  Upon receipt by the Company of this Warrant at the office of the
Company,  in proper form for exercise and,  unless a cashless  exercise is being
made in  accordance  with Section 2 of this Warrant,  accompanied  by the amount
equal to the  aggregate  Warrant  Price,  the  Holder  shall be deemed to be the
holder of record of the Shares issuable upon such exercise, notwithstanding that
the  stock  transfer  books  of  the  Company  shall  then  be  closed  or  that
certificates  representing  such Shares shall not then be actually  delivered to
the Holder.

         Notwithstanding  anything else herein to the contrary, the Holder shall
not have the right,  and the Company shall not have the obligation,  to exercise
all or any portion of the Warrants if and to the extent that the issuance to the
Holder of shares of Common Stock upon such exercise of the Warrants would result
in the  Holder  being  deemed the  "beneficial  owner" of 5% or more of the then
outstanding  shares of Common Stock of the Company within the meaning of Section
13(d)  of the  Securities  Exchange  Act of  1934,  as  amended,  and the  rules
promulgated thereunder.

         If this Warrant  shall have been  exercised  only in part,  the Company
shall,  at the time of  delivery  of such  Shares,  deliver  to the Holder a new
Warrant evidencing the right to purchase the remaining Shares called for by this
Warrant,  which new Warrant shall in all other  respects be identical  with this
Warrant, or, at the request of Holder,  appropriate notation may be made on this
Warrant which shall then be returned to Holder.

         2. Exercise.  The Holder shall pay the Warrant Price to the Company for
each  Warrant that it  exercises  if as of the Term Loan  Maturity  Date (a) the
registration  statement  to be filed by the  Company  with  the  Securities  and
Exchange  Commission (the "SEC") to register the Holder's  re-sale of the Common
Stock  underlying  the Warrant has been  declared  effective by the SEC; (b) the
closing bid price of the Common  Stock of the Company as  published in Bloomberg
for each  trading  day within the  thirty  calendar  days prior to the Term Loan
Maturity  Date has  equaled or exceeded  $0.60 per share;  and (c) the volume of
trading of the Common Stock of the Company as  published  in Bloomberg  for each
trading day within the thirty calendar days prior to the Term Loan Maturity Date
has equaled or exceeded 100,000 shares.  If all of such conditions are not fully
satisfied  by the Term  Loan  Maturity  Date,  then in lieu of  exercising  this
Warrant  by payment  in cash or check,  the Holder may elect to pay the  Warrant
Price by reducing the number of Shares issuable upon exercise of this Warrant in
accordance with the following formula:


                               X =    Y(A-B)
                                    ---------
                                        A

Where:      X   =    the number of Shares to be issued to the Holder.

            Y   =    the number of Shares  requested to be exercised under this
                     Warrant.

            A   =    the Fair Market Value of one (1) Share of Common Stock as
                     of the date such  Warrant is exercised.

            B   =    the Warrant Price.



                                     - 2 -
<PAGE>


"Fair  Market  Value" of the  Company's  Common  Stock  means the average of the
closing bid prices of the Common Stock as  published  in  Bloomberg  for the ten
trading days prior to the date of determination of fair market value.

         3. Stock  Fully  Paid;  Reservation  of Shares.  All Shares that may be
issued upon the exercise of the rights  represented  by this Warrant will,  upon
issuance, be fully paid and nonassessable,  and free from all preemptive rights,
taxes, liens and charges with respect to the issue thereof;  provided,  however,
that the Company shall not be required to pay any transfer taxes with respect to
the issue of shares in any name other than that of the registered holder hereof.
During the period  within  which the rights  represented  by this Warrant may be
exercised,  the Company will at all times have authorized,  and reserved for the
purpose of the issue upon  exercise of the  purchase  rights  evidenced  by this
Warrant,  a  sufficient  number of shares of  Common  Stock to  provide  for the
exercise of the rights  represented  by this  Warrant.  The Company shall at all
times  take all such  action  and  obtain  all such  permits or orders as may be
necessary to enable the Company  lawfully to issue such Common Stock as duly and
validly  issued,  fully paid and  nonassessable  shares upon exercise in full of
this Warrant.

         4.  Fractional  Shares.  No  fractional  shares of Common Stock will be
issued in connection with any exercise hereunder, but in lieu of such fractional
shares the Company shall make a cash payment therefor upon the basis of the Fair
Market Value of such Shares.

         5. Adjustment. This Warrant shall be subject to adjustment from time to
time upon the occurrence of certain events, as follows:

            (a)  Adjustment  for Stock Splits and  Combinations.  If the Company
shall  at any  time or from  time  to  time  after  the  date  hereof  effect  a
subdivision of the  outstanding  Common Stock,  the Warrant Price then in effect
immediately before that subdivision shall be proportionately  decreased.  If the
Company shall at any time or from time to time after the date hereof combine the
outstanding  Common Stock, the Warrant Price then in effect  immediately  before
the combination shall be  proportionately  increased.  Any adjustment under this
subsection  shall  become  effective  at the close of  business  on the date the
subdivision or combination becomes effective.

            (b) Adjustment for Certain Dividends and Distributions. In the event
the Company at any time or from time to time after the date hereof shall make or
issue a dividend or other  distribution  payable in additional  shares of Common
Stock,  then and in each such event the Warrant  Price shall be  decreased as of
the time of such issuance, by multiplying the Warrant Price by a fraction:

                  (x)      the  numerator  of which shall be the total number of
                           shares  of  Common  Stock   issued  and   outstanding
                           immediately prior to the time of such issuance; and

                  (y)      the denominator of which shall be the total number of
                           shares  of  Common  Stock   issued  and   outstanding
                           immediately  prior to the time of such  issuance plus
                           the  number of shares of  Common  Stock  issuable  in
                           payment of such dividend or distribution.

            (c)  Adjustment  of Number of Shares.  Upon each  adjustment  of the
Warrant  Price  pursuant to either  Section  5(a) or 5(b) of this  Warrant,  the
number of shares of Common Stock purchasable upon exercise of this Warrant shall
be adjusted to the number of shares of Common  Stock,  calculated to the nearest
one hundredth of a share, obtained by multiplying the number of shares of Common
Stock purchasable  immediately prior to such adjustment upon the exercise of the
Warrant by the Warrant Price in effect prior to such adjustment and dividing the
product so obtained by the new Warrant Price.


                                     - 3 -
<PAGE>

            (d) Adjustment for Reclassification,  Exchange and Substitution.  If
the Common Stock issuable upon the exercise of this Warrant are changed into the
same or different number of shares of any class or classes of stock,  whether by
recapitalization,  reclassification  or otherwise  (other than a subdivision  or
combination  provided  for in Section  5(a) above,  a dividend  or  distribution
provided for in Section 5(b) above, or a reorganization,  merger,  consolidation
or sale of assets,  provided for in Section  5(e)  below),  then and in any such
event the Holder shall have the right  thereafter  to exercise this Warrant into
the  kind  and  amount  of stock  and  other  securities  receivable  upon  such
recapitalization,  reclassification or other change, by holders of the number of
shares  of Common  Stock  for  which  this  Warrant  might  have been  exercised
immediately prior to such recapitalization, reclassification or change.

            (e) Reorganization,  Mergers,  Consolidations or Sales of Assets. If
at any time or from time to time there is a capital reorganization of the Common
Stock  (other than a  subdivision  or  combination  provided for in Section 5(a)
above,  a dividend or  distribution  provided  for in Section  5(b) above,  or a
reclassification  or exchange of shares provided for in Section 5(d) above) or a
merger or consolidation of the Company with or into another entity, or a sale of
all or  substantially  all of the Company's  properties  and assets to any other
person or entity, then, as a part of such reorganization,  merger, consolidation
or sale, provision shall be made so that the Holder shall thereafter be entitled
to receive upon  exercise of this Warrant the number of shares of stock or other
securities,  money  or  property  of the  Company,  or of the  successor  entity
resulting from such merger or consolidation or sale, to which a holder of Common
Stock  deliverable  upon  conversion  would have been  entitled on such  capital
reorganization, merger, consolidation, or sale. The Company shall not effect any
reorganization,  merger,  consolidation or sale unless prior to the consummation
thereof each entity or person  (other than the Company)  that may be required to
deliver any cash, securities or other property upon the exercise of this Warrant
shall assume, by written  instrument  delivered to the Holder, the obligation to
deliver to the Holder such cash,  securities or other  property as in accordance
with the  foregoing  provisions  the  Holder may be  entitled  to  receive.  The
foregoing  provisions of this Section 5(e) shall  similarly  apply to successive
reorganizations, mergers, consolidations and sales.

            (f)  Adjustment of Warrant Price for Matching  Purposes.  (i) In the
event that the Company shall issue Common Stock or rights, warrants,  options or
convertible or exchangeable securities entitling the holder thereof to subscribe
for or purchase,  convert into or exchange for Common Stock, in any such case at
a price per share less than $0.16, then the Warrant Price in effect  immediately
prior to such  earliest  date shall be adjusted so that the Warrant  Price shall
equal  the  price   determined  by  multiplying  the  Warrant  Price  in  effect
immediately prior to such earliest date by the fraction:

         (x) whose  numerator  shall be the  number  of  shares of Common  Stock
         outstanding  on such date plus the number of shares which the aggregate
         offering  price of the total number of shares so offered would purchase
         at the then applicable Warrant Price (such amount,  with respect to any
         such  rights,   warrants,   options  or  convertible  or   exchangeable
         securities,  determined  by  multiplying  the  total  number  of shares
         subject thereto by the exercise price of such rights, warrants, options
         or convertible or  exchangeable  securities and dividing the product so
         obtained by the then applicable Warrant Price), and

         (y) whose  denominator  shall be the  number of shares of Common  Stock
         outstanding on such date plus the number of additional shares of Common
         Stock to be issued or  distributed  or receivable  upon exercise of any
         such right, warrant, option or convertible or exchangeable security.

Such  adjustment  shall be made  successively  whenever  any such Common  Stock,
rights,  warrants,  options or convertible or exchangeable securities are issued
or distributed.  In determining whether any rights,  warrants or options entitle
the holders to  subscribe  for or purchase  shares of Common  Stock at less than


                                     - 4 -
<PAGE>

$0.16, and in determining the aggregate offering price of shares of Common Stock
so issued or  distributed,  there shall be taken into account any  consideration
received by the Company for such Common Stock,  rights,  warrants,  options,  or
convertible  or  exchangeable  securities.  If any  right,  warrant,  option  or
convertible or  exchangeable  security to purchase or acquire Common Stock,  the
issuance of which  resulted in an adjustment  in the Warrant  Price  pursuant to
this subsection (i) shall expire and shall not have been exercised,  the Warrant
Price shall  immediately upon such expiration be recomputed to the Warrant Price
which would have been in effect had the  adjustment  of the  Warrant  Price made
upon the issuance of such right, warrant,  option or convertible or exchangeable
security  been made on the  basis of  offering  for  subscription,  purchase  or
issuance,  as the case may be,  only of that  number of  shares of Common  Stock
actually  purchased or issued upon the actual  exercise of such right,  warrant,
option or convertible or exchangeable securities.

                         (ii)  No  adjustment  in the  Warrant  Price  shall  be
required unless the adjustment would require an increase or decrease of at least
1% in the Warrant Price then in effect; provided,  however, that any adjustments
that by reason of this Section 5(f) are not required to be made shall be carried
forward and taken into account in any subsequent  adjustment.  All  calculations
under this Section 5(f) shall be made to the nearest cent or nearest  1/100th of
a share.

                         (iii)  Notwithstanding  anything  to the  contrary  set
forth in this Section  5(f),  no  adjustment  shall be made to the Warrant Price
upon (A) the issuance of shares of Common Stock pursuant to any  compensation or
incentive plan for officers, directors, employees or consultants of the Company,
or (B) the  issuance  of Common  Stock upon the  conversion  or  exercise of the
options, warrants or rights of the Company outstanding as of the date hereof.

            (g) No  Impairment.  The  Company  will  not,  by  amendment  of its
Articles of  Incorporation  or through any  reorganization,  transfer of assets,
consolidation,  merger,  dissolution,  issue or sale of  securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or  performed  hereunder by the Company but will at all
times in good faith  assist in the carrying  out of all the  provisions  of this
Section and in the taking of all such action as may be necessary or  appropriate
in order to protect  the  conversion  rights of the Holder  against  dilution or
other impairment.  Without limiting the generality of the foregoing, the Company
will not issue any capital stock of any class which is preferred as to dividends
or  as  to  the  distribution  of  assets  upon  the  voluntary  or  involuntary
dissolution, liquidation or winding up of the Company.

            (h) Notice of  Adjustments.  Whenever this Warrant shall be adjusted
pursuant to this Section 5, the Company  shall make a  certificate  signed by an
officer of the Company setting forth, in reasonable  detail, the event requiring
the  adjustment,  the  amount  of the  adjustment,  the  method  by  which  such
adjustment was calculated,  and the new Warrant Price and the type or the number
of Shares  purchasable  after giving effect to such adjustment,  and shall cause
copies of such  certificate to be mailed (by first class mail,  postage prepaid)
to the Holder.

         6. The Company's Obligation to Make Payments.

            (a)  Dividends  and  Distributions.  In the event the Company at any
time or from time to time after the date  hereof  shall make or issue a dividend
or other distribution,  whether payable in cash, securities or other property of
the Company, with respect to any of its capital stock for which an adjustment is
not made pursuant to Section 5 of this Warrant, then and in each such event, the
Company  shall  concurrently  make a cash  payment  to the  Holder  equal to the
product of (i) the quotient obtained by dividing (x) the amount of cash plus the
fair value of any property or securities distributed by (y) the number of shares
of Common Stock outstanding on the record date for such dividend or distribution
and (ii) the number of Shares on such record date.


                                     - 5 -
<PAGE>

            (b)  Redemption  of Capital  Stock.  In the event the Company at any
time or from time to time after the date hereof shall  repurchase  or redeem any
of its  capital  stock or any rights,  including  without  limitation,  options,
warrants  or other  convertible  or  exchangeable  securities,  to acquire  such
capital stock, then and in each such event, the Company shall  concurrently make
a cash payment to the Holder  equal to the product of (i) the quotient  obtained
by dividing (x) the aggregate amount of cash and the aggregate fair value of any
property  paid out by the  Company in  connection  with any such  repurchase  or
redemption  by (y) the number of shares of Common Stock  outstanding  on a fully
diluted basis immediately after such repurchase or redemption and (2) the number
of Shares.

         7.  Notice of Record Date. In the event:

                  (1)      that the  Company  declares a dividend  (or any other
                           distribution)  on any of its capital stock (including
                           without limitation, its Common Stock);

                  (2)      that the  Company  repurchases  or redeems any of its
                           capital  stock  (including  without  limitation,  its
                           Common  Stock) or any rights to acquire  such capital
                           stock;

                  (3)      that  the  Company   subdivides   or   combines   its
                           outstanding shares of Common Stock;

                  (4)      of any  reclassification  of the Common Stock,  or of
                           any  consolidation,  merger or share  exchange of the
                           Company into or with another  entity,  or of the sale
                           of all or  substantially  all  of the  assets  of the
                           Company;

                  (5)      of  the   involuntary   or   voluntary   dissolution,
                           liquidation or winding up of the Company; or

                  (6)      of any  offer of its  Common  Stock or any  rights to
                           acquire such Common Stock for consideration  paid per
                           share of Common  Stock  less than the  Warrant  Price
                           then in effect.

then the  Company  shall  notify  the  Holder at least 30 days prior to the date
specified in (A), (B) or (C) below, in writing stating:

                  (A)  the   record   date  of  such   dividend,   distribution,
         repurchase,  redemption, subdivision or combination, or, if a record is
         not to be taken,  the date as to which the  holders of Common  Stock of
         record  to be  entitled  to such  dividend,  distribution,  repurchase,
         redemption, subdivision or combination are to be determined;

                  (B) the date on which  such  reclassification,  consolidation,
         merger, share exchange, sale, dissolution, liquidation or winding up is
         expected to become  effective,  and the date as of which it is expected
         that  holders of Common  Stock of record  shall be entitled to exchange
         their  shares  of  Common  Stock  for   securities  or  other  property
         deliverable upon such  reclassification,  consolidation,  merger, sale,
         dissolution or winding up; or

                  (C) the date on which such offering of its Common Stock or any
         rights to acquire such Common Stock for consideration paid per share of
         Common  Stock  less  than the  Warrant  Price  is  expected  to  become
         consummated.


                                     - 6 -
<PAGE>

         8. Compliance  with  Securities  Act;  Disposition of Warrant or Common
Stock.

            (a)  Compliance  with  Securities  Act.  The Holder,  by  acceptance
hereof,  agrees  that this  Warrant  and the Shares to be issued  upon  exercise
hereof are being  acquired for  investment  and that such Holder will not offer,
sell or otherwise  dispose of this Warrant or any Common Stock to be issued upon
exercise hereof except under  circumstances which will not result in a violation
of the  Securities  Act of 1933, as amended (the "Act").  All Shares issued upon
exercise of this Warrant (unless registered under the Act or sold or transferred
pursuant to Rule 144  promulgated  under the Act) shall be stamped or  imprinted
with a legend in substantially the following form:

         "THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
         OR THE SECURITIES  ACTS OF ANY STATE AND MAY NOT BE SOLD OR TRANSFERRED
         UNLESS THERE IS AN  EFFECTIVE  REGISTRATION  STATEMENT  UNDER SUCH ACTS
         COVERING   THIS   SECURITY  OR  PURSUANT  TO  AN  EXEMPTION   FROM  THE
         REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACTS."

            (b)  Disposition  of  Warrant  or  Shares.  Subject to the terms and
conditions of this Warrant and applicable  securities laws, this Warrant and the
rights represented by this Warrant may be transferred,  assigned or pledged,  in
whole or in part with prior written notice to the Company. Any transfer shall be
accompanied by the Notice of Transfer form attached hereto as Exhibit B.

         9. Rights as Shareholders.  The Holder shall not, by virtue hereof,  be
entitled to any rights of a shareholder in the Company, either at law or equity,
and the rights of the Holder are limited to those  expressed in this Warrant and
are not enforceable against the Company except to the extent set forth herein.

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

            (a) This  Warrant  has been  duly  authorized  and  executed  by the
Company and is a valid and binding  obligation  of the  Company  enforceable  in
accordance with its terms;

            (b) The Shares have been duly  authorized  and reserved for issuance
by the Company and,  when issued in accordance  with the terms  hereof,  will be
validly issued, fully paid and nonassessable;

            (c) The rights, preferences,  privileges and restrictions granted to
or  imposed  upon the  Shares and the  holders  thereof  are as set forth in the
Company's Articles of Incorporation;

            (d) The  execution  and  delivery of this  Warrant are not,  and the
issuance of the Shares  upon  exercise of this  Warrant in  accordance  with the
terms  hereof  will  not  be,   inconsistent  with  the  Company's  Articles  of
Incorporation or by-laws,  do not and will not contravene any law,  governmental
rule or regulation, judgment or order applicable to the Company, and, except for
consents  that have  already been  obtained by the Company,  do not and will not
conflict with or contravene any provision of, or constitute a default under, any
indenture,  mortgage,  contract  or other  instrument  of which the Company is a
party or by which it is bound or require the consent or approval  of, the giving
of notice to, the registration with or the taking of any action in respect of or
by, any federal,  state or local government authority or agency or other person;
and

            (e)   Capitalization.   As  of  the   date  of  this   Warrant   the
capitalization of the Company is as follows:


                                     - 7 -
<PAGE>

                  (i) Common Stock. A total of 100,000,000  authorized shares of
                  Common  Stock,  of which  30,791,911  shares  were  issued and
                  outstanding.  All  of  such  outstanding  shares  are  validly
                  issued, fully paid and non-assessable. No shares of the Common
                  Stock are held in the Company's treasury.

                  (ii) Preferred Stock. A total of 25,000,000  authorized shares
                  of Preferred  Stock,  of which 559,322  shares were issued and
                  outstanding.

                  (iii) Options, Warrants,  Reserved Shares. Except as disclosed
                  in the Form  10-KSB for the period  ended  December  31,  2002
                  filed by the Company,  or the Form 10-QSB filed by the Company
                  (or  provided to the Holder if not filed) for the period ended
                  March 31, 2003,  there are no outstanding  options,  warrants,
                  rights   (including   conversion  or  preemptive   rights)  or
                  agreements for the purchase or acquisition from the Company of
                  any shares of its capital stock or any securities  convertible
                  into or ultimately  exchangeable or exercisable for any shares
                  of the  Company's  capital  stock.  No shares of the Company's
                  outstanding  capital  stock,  or stock issuable upon exercise,
                  conversion or exchange of any outstanding options, warrants or
                  rights, or other stock issuable by the Company, are subject to
                  any rights of first  refusal or other rights to purchase  such
                  stock  (whether in favor of the Company or any other  person),
                  pursuant to any agreement,  commitment or other  obligation of
                  the Company.

         11.   Registration   Rights.  If  the  Company  proposes  to  file  any
registration  statement  under the Act (other than Form S-8), with respect to an
offering  of any  equity  securities,  then the  Company  shall  give the Holder
written notice of such proposed  filing as soon as practicable  (but in no event
less than thirty (30) days before the  anticipated  initial  filing date of such
registration statement),  and such notice shall offer the Holder the opportunity
to register  such number of Shares as the Holder shall  request (the  "Piggyback
Shares").  The Company shall bear all costs of registering the Piggyback Shares,
except for underwriting  discounts or commissions if the registration  statement
relates to an underwritten  offering.  Any  registration  rights granted by this
paragraph  expire when shares  issued  pursuant to this  Warrant  Agreement  are
eligible for sale under Rule 144(k) of the Securities Act of 1933.

         12.  Modification and Waiver. This Warrant and any provision hereof may
be changed,  waived,  discharged or terminated  only by an instrument in writing
signed by the party against which enforcement of the same is sought.

         13. Notices. Except as otherwise expressly provided herein, all notices
and other  communications  provided for hereunder shall be in writing (including
telegraphic,  telex, telecopier or cable communication) and mailed, telegraphed,
telexed, telecopied,  cabled or delivered to the applicable party at its address
specified  opposite its  signature  below,  or at such other address as shall be
designated by such party in a written notice to the other.  All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied or cabled or
sent by overnight courier,  be effective when deposited in the mails,  delivered
to the telegraph company,  cable company or overnight  courier,  as the case may
be, or sent by telex or telecopier.

         14.  Descriptive  Headings.  The  descriptive  headings  of the several
sections of this Warrant are inserted for convenience only and do not constitute
a part of this Warrant.

         15.  Governing Law. THIS WARRANT AND THE RIGHTS AND  OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF ILLINOIS.


                                     - 8 -
<PAGE>

         16. Binding  Effect on  Successors.  This Warrant shall be binding upon
any entity succeeding the Company by merger, consolidation or acquisition of all
or substantially all of the Company's assets,  and all of the obligations of the
Company  relating to the Common Stock issuable upon the exercise of this Warrant
shall  survive the  exercise,  and  termination  of this  Warrant and all of the
covenants  and  agreements  of the  Company  shall  inure to the  benefit of the
successors and assigns of the Holder.

         17.  Severability.  In case any one or more of the provisions contained
in this Warrant shall be invalid,  illegal or unenforceable in any respect,  the
validity,  legality and  enforceability  of the remaining  provisions  contained
herein shall not in any way be affected or impaired  thereby.  The parties shall
endeavor  in  good  faith  negotiations  to  replace  the  invalid,  illegal  or
unenforceable  provisions  with valid  provisions,  the economic effect of which
comes as close as  possible  to that of the  invalid,  illegal or  unenforceable
provisions.

         18. Lost Warrants or Stock  Certificates.  The Company covenants to the
Holder that upon receipt of evidence  reasonably  satisfactory to the Company of
the  loss,  theft,  destruction,  or  mutilation  of this  Warrant  or any stock
certificate  and,  in the case of any such  loss,  theft  or  destruction,  upon
receipt of an indemnity  reasonably  satisfactory to the Company, or in the case
of any such mutilation upon surrender and  cancellation of such Warrant or stock
certificate,  the  Company  will  make  and  deliver  a  new  Warrant  or  stock
certificate,  of like tenor, in lieu of the lost, stolen, destroyed or mutilated
Warrant or stock certificate.



                            [Signature Page Follows]




                                     - 9 -
<PAGE>





         IN WITNESS WHEREOF,  the Company has caused this Warrant to be executed
and  delivered  by its duly  authorized  officer on the day and year first above
written.

                               NUWAY MEDICAL, INC.


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

                               Address:        23461 South Pointe, Suite 200
                                               Laguna Hills, California 92653
                                               Attention:________________
                                               Facsimile:________________



ACKNOWLEDGED AND ACCEPTED:

AUGUSTINE II, LLC

    By:  AUGUSTINE CAPITAL
         MANAGEMENT, L.L.C., its manager

         By:
            -----------------------------------------
         Name:  John T. Porter
         Title:  President

Address:          141 West Jackson Boulevard, Suite 2182
                  Chicago, Illinois 60604
                  Attention:  John T. Porter
                  Facsimile:  (312) 427-5396




                                     - 10 -
<PAGE>



                                    EXHIBIT A

                               NOTICE OF EXERCISE


TO:      NUWAY MEDICAL, INC.

         (1) The  undersigned  hereby  elects to purchase  __________  shares of
Common  Stock of NUWAY  MEDICAL,  INC.  pursuant  to the  terms of the  attached
Warrant,  and, unless such Warrant allows the exercise to be "cashless," tenders
herewith payment of the Warrant Price for such shares in full.

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


                                        ----------------------------------------
                                                      (Name)


                                        ----------------------------------------
                                                      (Name)

         (3)  Please  issue a new  Warrant  for the  unexercised  portion of the
attached  Warrant  in the name of the  undersigned  or in such  other name as is
specified below:


                                        ----------------------------------------
                                                      (Name)

                                        ----------------------------------------
                                                      (Address)


                                        ----------------------------------------
                                                      (Signature)

                                        ----------------------------------------
                                                      (Date)



<PAGE>



                                    EXHIBIT B

                               NOTICE OF TRANSFER
                  (To be signed only upon transfer of Warrant)

         FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto  ____________________________________________  the right represented by the
attached  Warrant to  purchase  __________  shares of the Common  Stock of NUWAY
MEDICAL,   INC.,   to  which  the  attached   Warrant   relates,   and  appoints
_____________________  as Attorney to transfer  such right on the books of NUWAY
MEDICAL, INC., with full power of substitution in the premises.

         Dated:
               -----------------------------

                                        ----------------------------------------
                                        (Signature must conform in all respects
                                        to the name of the Holder as specified
                                        on the face of the Warrant)

                                        ----------------------------------------

                                        ----------------------------------------
                                                       (Address)


Signed in the presence of:
                          ------------------------------------