EXHIBIT 2.1


                         FORM OF SUBSCRIPTION AGREEMENT


                  You (the "Subscriber" or "Purchaser" or "Holder") hereby agree
to  purchase,  and THE  RECOVERY  NETWORK,  INC.,  a Colorado  corporation  (the
"Company"),  hereby agrees to issue and to sell to the Subscriber, the number of
shares (the "Company  Shares") of the Company's Common Stock, $.01 par value per
share  ("Company  Stock"),  and a Common Stock Purchase  Warrant to purchase the
number of shares of Common Stock (the  "Warrant")  designated  on the  signature
page hereof,  in the form annexed  hereto as Exhibit A. (The Company  Shares are
sometimes  referred to herein as the "Shares" or "Common Shares").  (The Company
Shares,  the Warrants and the shares of Common Stock  issuable  upon exercise of
the Warrants and the Additional  Shares [as hereinafter  defined] and Put Shares
[as  hereinafter   defined]  are   collectively   referred  to  herein  as,  the
"Securities"). Upon acceptance of this Agreement on the Closing Date (as defined
herein) by the Subscriber, the Company shall issue and deliver to the Subscriber
the Company Shares and Warrants  against  payment,  by federal funds (U.S.) wire
transfer of the amount  designated on the signature page hereof  pursuant to the
terms of a Funds Escrow Agreement annexed hereto as Exhibit B.

                  The  following  terms  and  conditions  shall  apply  to  this
subscription.

                  1. Subscriber's Representations and Warranties. The Subscriber
hereby represents and warrants to and agrees with the Company that:

                           (a)  Information on Company.  The Subscriber has been
furnished with and has read the Company's  Registration  Statement on Form SB-2,
as amended  (File No.  333-27787)  and  subsequent  Forms  10-QSB  and 8-K,  and
Schedule 14A,  each as filed with the U.S.  Securities  and Exchange  Commission
(the "Commission") (collectively, with exhibits thereto, hereinafter referred to
as the  "Reports").  In addition,  the  Subscriber has received from the Company
such other information concerning its operations,  financial condition and other
matters  as the  Subscriber  has  requested,  and  considered  all  factors  the
Subscriber  deems material in deciding on the  advisability  of investing in the
Securities  (such  information  in writing is  collectively,  the "Other Written
Information").

                           (b)  Information on Subscriber.  The Subscriber is an
"accredited  investor",  as such term is defined in Regulation D promulgated  by
the Commission  under the Securities Act of 1933, as amended,  is experienced in
investments and business matters,  has made investments of a speculative  nature
and has  purchased  securities  of United  States  publicly-owned  companies  in
private placements in the past and, with its representatives, has such knowledge
and  experience in financial,  tax and other  business  matters as to enable the
Subscriber to utilize the information  made available by the Company to evaluate
the merits and risks of and to make an informed investment decision with respect
to the  proposed  purchase,  which  represents  a  speculative  investment.  The
Subscriber  has the authority and is duly and legally  qualified to purchase and
own the  Securities.  The Subscriber is able to bear the risk of such investment
for an indefinite period and to afford a complete loss thereof.

<PAGE>

                           (c) Purchase of Company  Shares and Warrants.  On the
Closing Date, the  Subscriber  will purchase the Company Shares and Warrants for
its own account and not with a view to any distribution thereof.

                           (d) Compliance  with  Securities  Act. The Subscriber
understands and agrees that the Securities  have not been  registered  under the
Securities  Act of 1933, as amended (the "1933 Act") by reason of their issuance
in a transaction that does not require registration under the 1933 Act, and that
such Securities must be held unless a subsequent disposition is registered under
the 1933 Act or is exempt from such registration. The Subscriber agrees that if,
in the future,  the Subscriber should decide to dispose of any of the Securities
acquired  by it  pursuant  to this  Agreement,  the  Subscriber  will do so only
pursuant to a registration  statement or by disposition exempt from registration
requirements under the 1933 Act.

                           (e) Common Shares Legend.  The Company Shares and the
shares of Common Stock  issuable  upon the  exercise of the  Warrants  which the
Subscriber  is acquiring  pursuant to this  Agreement  shall bear the  following
legend:

                  "THESE SHARES OF COMMON STOCK HAVE NOT BEEN
                  REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
                  AMENDED.  THESE SHARES OF COMMON STOCK MAY NOT
                  BE SOLD, OFFERED FOR SALE, PLEDGED OR
                  HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
                  REGISTRATION STATEMENT OR AN OPINION OF COUNSEL
                  REASONABLY SATISFACTORY TO RECOVERY NETWORK,
                  INC. THAT SUCH REGISTRATION IS NOT REQUIRED."

                           (f)  Warrants   Legend.   The   Warrants   which  the
Subscriber  is acquiring  pursuant to this  Agreement  shall bear the  following
legend:

                  "THIS WARRANT AND THE COMMON SHARES  ISSUABLE UPON EXERCISE OF
                  THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
                  OF 1933,  AS  AMENDED.  THIS  WARRANT  AND THE  COMMON  SHARES
                  ISSUABLE  UPON  EXERCISE  OF THIS  WARRANT  MAY  NOT BE  SOLD,
                  OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
                  EFFECTIVE  REGISTRATION  STATEMENT  OR AN  OPINION  OF COUNSEL
                  REASONABLY  SATISFACTORY  TO THE RECOVERY  NETWORK,  INC. THAT
                  SUCH REGISTRATION IS NOT REQUIRED."

                           (g)  Correctness of  Representations.  The Subscriber
represents  that  the  foregoing  representations  and  warranties  are true and
correct as of the date hereof and, unless the Subscriber  otherwise notifies the
Company prior to the Closing Date (as hereinafter defined), shall 9/23/98

<PAGE>

be true and correct as of the Closing Date.  The foregoing  representations  and
warranties shall survive the Closing Date.

                  2.  Company   Representations  and  Warranties.   The  Company
represents and warrants to and agrees with the Subscriber that:

                           (a) Due  Incorporation.  The  Company and each of its
wholly-owned subsidiaries is a corporation duly organized,  validly existing and
in good standing  under the laws of the state of its  incorporation  and has the
requisite  corporate power to own its properties and to carry on its business as
now being conducted.  The Company and each of its  wholly-owned  subsidiaries is
duly  qualified as a foreign  corporation to do business and is in good standing
in each  jurisdiction  where the nature of the  business  conducted  or property
owned by it makes such qualification  necessary,  other than those jurisdictions
in which the failure to so qualify would not have a material  adverse  effect on
the business,  operations or prospects or condition  (financial or otherwise) of
the Company.

                           (b)  Outstanding  Stock.  All issued and  outstanding
shares of capital stock of the Company and each of its wholly-owned subsidiaries
has  been  duly   authorized   and  validly   issued  and  are  fully  paid  and
non-assessable.

                           (c)  Authority;  Enforceability.  This  Agreement has
been duly  authorized,  executed and delivered by the Company and is a valid and
binding  agreement   enforceable  in  accordance  with  its  terms,  subject  to
bankruptcy,  insolvency,  fraudulent  transfer,  reorganization,  moratorium and
similar laws of general applicability relating to or affecting creditors' rights
generally  and to  general  principles  of  equity;  and the  Company  has  full
corporate  power and  authority  necessary to enter into this  Agreement  and to
perform its obligations  hereunder and all other agreements  entered into by the
Company relating hereto.

                           (d)  Additional  Issuances.  There are no outstanding
agreements or preemptive or similar rights  affecting the Company's common stock
and no  outstanding  rights,  warrants  or options to  acquire,  or  instruments
convertible  into or  exchangeable  for, or  agreements or  understandings  with
respect to the sale or issuance  of any shares of common  stock or equity of the
Company or other  equity  interest in any of the  subsidiaries  of the  Company,
except (i) as described in the Reports or Other  Written  Information,  and (ii)
for 200,000  shares of Common Stock and a warrant to purchase  200,000 shares of
Common Stock, each issued to TeleServices International Group Inc.

                           (e) Consents. No consent, approval,  authorization or
order  of  any  court,   governmental   agency  or  body  or  arbitrator  having
jurisdiction  over  the  Company,  or any  of its  affiliates  is  required  for
execution of this Agreement,  including, without limitation issuance and sale of
the  Securities,  or the  performance  of the Company's  obligations  hereunder,
except as described or otherwise referenced herein. 9/23/98

<PAGE>



                           (f)  No   Violation   or   Conflict.   Assuming   the
representations  and  warranties  of the  Subscriber in Paragraph 1 are true and
correct and the Subscriber  complies with its obligations  under this Agreement,
neither the  issuance  and sale of the  Securities  nor the  performance  of its
obligations under this Agreement by the Company will:

                                    (i)  violate,  conflict  with,  result  in a
breach of, or  constitute a default (or an event which with the giving of notice
of the lapse of time or both would be reasonably likely to constitute a default)
under (A) the articles of  incorporation,  charter or bylaws of the Company,  or
any of its affiliates,  (B) to the Company's  knowledge,  any decree,  judgment,
order, law, treaty, rule, regulation or determination applicable to the Company,
or any  of its  affiliates  of  any  court,  governmental  agency  or  body,  or
arbitrator  having  jurisdiction  over the Company,  or any of its affiliates or
over the properties or assets of the Company, or any of its affiliates,  (C) the
terms of any bond, debenture, note or any other evidence of indebtedness, or any
agreement, stock option or other similar plan, indenture,  lease, mortgage, deed
of trust or other instrument to which the Company, or any of its affiliates is a
party, by which the Company,  or any of its affiliates is bound, or to which any
of the properties of the Company,  or any of its  affiliates is subject,  or (D)
the terms of any "lock-up" or similar  provision of any  underwriting or similar
agreement to which the Company, or any of its affiliates is a party; or

                                    (ii) result in the creation or imposition of
any lien,  charge or encumbrance upon the Securities or any of the assets of the
Company, or any of its affiliates.

                           (g) The Securities. The Securities upon issuance:

                                    (i) are,  or will be,  free and clear of any
security interests, liens, claims or other encumbrances;

                                    (ii) have been, or will be, duly and validly
authorized  and on the date of issuance and on the Closing Date, as  hereinafter
defined,  and the date the Warrants are exercised  according to their terms,  as
the case may be, the Securities will be duly and validly issued,  fully paid and
nonassessable,  and if  registered  pursuant to the 1933 Act,  free  trading and
unrestricted;

                                    (iii)  will not have been  issued or sold in
violation  of any  preemptive  or other  similar  rights of the  holders  of any
securities of the Company;

                                    (iv) will not subject the holders thereof to
personal liability by reason of being such holders; and

                           (h)  Litigation.  There is no pending or, to the best
knowledge of the Company,  threatened action, suit,  proceeding or investigation
before any court, governmental agency or body, or arbitrator having jurisdiction
over the Company,  or any of its  affiliates  that would affect the execution by
the  Company or the  performance  by the Company of its  obligations  under this
Agreement,  or  which  was  not  disclosed  in the  Reports  and  Other  Written
Information.

<PAGE>

                           (i) Reporting Company. The Company is a publicly-held
company  whose  common  stock is (and has been for the past 90 days)  registered
pursuant to Section  12(g) of the  Securities  Exchange Act of 1934,  as amended
(the "1934 Act") and is duly listed for trading on the NASDAQ  SmallCap  Market.
Pursuant to the  provisions  of the 1934 Act,  the Company has timely  filed all
reports and other materials  required to be filed thereunder with the Securities
and Exchange  Commission  during the preceding  twelve months,  and,  subject to
compliance  with General  Instruction  I.A. of Form S-3,  will be eligible as of
September 30, 1998 to file a Form S-3 to register the Securities.

                           (j) No  Market  Manipulation.  The  Company  has  not
taken,  and will not take,  directly or indirectly,  any action  designed to, or
that might  reasonably  be  expected  to,  cause or result in  stabilization  or
manipulation  of the price of the common stock of the Company to facilitate  the
sale or resale of the Company Shares or affect the price at which the Securities
may be issued.

                           (k) Information  Concerning Company.  The Reports and
Other  Written  Information  contain all  material  information  relating to the
Company and its operations and financial  condition as of their respective dates
which  information  is required to be disclosed  therein.  Since the date of the
financial  statements  set forth in the  Reports,  and except as modified in the
Other  Written  Information,  there has been no material  adverse  change in the
Company's business, financial condition or affairs not disclosed in the Reports.
The Reports and Other Written Information do not contain any untrue statement of
a material fact or omit to state a material  fact required to be stated  therein
or necessary to make the statements therein not misleading.

                           (l)  Dilution.  The  number of Shares  issuable  upon
Reset (as hereinafter  defined) and exercise of the Put (as hereinafter defined)
may  increase  substantially  in  certain  circumstances,   including,  but  not
necessarily limited to, the circumstance wherein the trading price of the Common
Stock declines prior to a Reset or exercise of the Company of the Put.

                           (m) Stop  Transfer.  The Company has not issued,  and
will not issue any stop  transfer  order or other  order  impeding  the sale and
delivery of the Securities.

                           (n)  Defaults.  Neither  the  Company  nor any of its
wholly-owned subsidiaries is in violation of its Certificate of Incorporation or
ByLaws.  Except as  described  in the  Reports  and Other  Written  Information,
neither the Company nor any of its  subsidiaries  is (i) in default  under or in
violation of any other  material  agreement or instrument to which it is a party
or by which it or any of its properties are bound or affected,  which default or
violation would have a material  adverse effect on the Company,  (ii) in default
with  respect  to any order of any court,  arbitrator  or  governmental  body or
subject to or party to any order of any court or governmental  authority arising
out of any action,  suit or proceeding under any statute or other law respecting
antitrust,  monopoly, restraint of trade, unfair competition or similar matters,
or (iii) to its knowledge in violation of any statute, rule or regulation of any
governmental authority material to its business.

                           (o) No Integrated  Offering.  Neither the Comany, 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 
<PAGE>



security or solicited any offers to buy any security  under  circumstances  that
would require  registration of any of the Securities under the 1933 Act or cause
the offering of the Securities  pursuant to this Agreement to be integrated with
prior  offerings by the Company for  purposes of the 1933 Act or any  applicable
stockholder approval provisions,  including, without limitation, under the rules
and  regulations  of  The  NASDAQ  SmallCap  Market  ("NASDAQ   SmallCap"),   as
applicable,  nor will the Company or any of its subsidiaries  take any action or
steps that would require  registration  of the Securities  under the 1933 Act or
cause the offering of the Securities to be integrated with other offerings.  The
Company  has not  conducted  and will not conduct  any  offering  other than the
transactions  contemplated  hereby that will be integrated  with the issuance of
the  Securities  solely for purposes of Rule 4460(i) of the NASDAQ Stock Market,
Inc.'s Marketplace Rules.

                           (p) Use of Proceeds.  The proceeds of the  Subscriber
funds to be released to the Company  will be used for working  capital,  general
corporate purposes and for expenses of this offering.

                           (q) No General Solicitation. Neither the Company, nor
any of its affiliates,  nor to its knowledge,  any person acting on its or their
behalf, has engaged in any form of general  solicitation or general  advertising
(within the meaning of Regulation D under the Act) in connection  with the offer
or sale of the Securities.

                           (r) Listing. The Company's common stock is quoted on,
and listed for trading on NASDAQ  SmallCap.  The Company has received no notice,
either oral or written,  with respect to the continued eligibility of the common
stock for such listing,  and the Company has maintained all requirements for the
continuation of such listing.

                           (s)  Correctness  of  Representations.   The  Company
represents  that  the  foregoing  representations  and  warranties  are true and
correct as of the date hereof in all material  respects and,  unless the Company
otherwise  notifies the Subscriber  prior to the Closing Date, shall be true and
correct  in  all  material  respects  as of  the  Closing  Date.  The  foregoing
representations and warranties shall survive the Closing Date.

                  3. Regulation D Offering. This Offering is being made pursuant
to the exemption from the registration provisions of the Securities Act of 1933,
as amended,  afforded by Rule 506 of Regulation D promulgated thereunder. On the
Closing Date, the Company will provide an opinion  acceptable to Subscriber from
the Company's  legal counsel  opining on the  availability  of the  Regulation D
exemption as it relates to the offer and issuance of the  Securities.  A form of
the legal opinion is annexed hereto as Exhibit C.

                  4.  Reissuance of  Securities.  The Company  agrees to reissue
certificates  representing  the  Securities  without  the  legends  set forth in
Sections 1(e) and 1(f) above at such time as (a) the holder thereof is permitted
to dispose of such Securities  pursuant to Rule 144(k) under the Act, or (b) the
Securities are registered under the Act.


<PAGE>

                  5.  Redemption.  The  Company  may not redeem  the  Securities
without  the  consent  of the  holder of the  Securities,  except  as  otherwise
described in Section 9.2 of this Subscription Agreement.

                  6. Legal Fees/Commissions. The Company shall pay to counsel to
the  Subscriber  its fee of $25,000 for services  rendered to the  Subscriber in
reviewing  this  Agreement and other  subscription  agreements for the aggregate
subscription amounts of up to $2,500,000. The Company will pay a cash commission
of four percent (4%) of the Purchase  Price  designated  on the  signature  page
hereto to  certain  placement  agents.  The  commissions  and legal fees will be
payable out of funds held pursuant to a Funds Escrow Agreement and Shares Escrow
Agreement to be entered into by the Company and Subscriber. The cash commissions
will be payable proportionately as Subscriber funds are released to the Company.
Additional  cash  commissions  of eight  percent  (8%)  will be  payable  to the
placement  agents in connection with gross proceeds from the Company's  exercise
of the Put described in Section 11 of this Subscription  Agreement.  The Company
will also issue to the placement agents as additional compensation, common stock
of the Company at the time Subscriber funds are released to the Company equal in
value to four percent (4%) of the Purchase  Price  designated  on the  signature
page hereto at a per share value equal to the Issue Price (per share) designated
on the signature  page hereto  ("Placement  Shares").  Seventy  percent (70%) of
Placement  Shares will be issued at the Closing and thirty  percent (30%) of the
Placement  Shares  will  be  issued  if  and  when  the  funds  portion  of  the
Registration  Escrow (as defined in Section  10.2(j)  herein) is released to the
Company.  All  the  representations,  covenants,  warranties  and  undertakings,
including but not limited to  registration  rights made or granted to or for the
benefit of the  Subscriber  are hereby  also made and  granted to the  Placement
Agents in respect of the Placement Shares.

                  7.1.  Covenants  of the  Company.  The Company  covenants  and
agrees with the Subscriber as follows:

                           (a) The Company will advise the Subscriber,  promptly
after it receives notice of issuance by the Securities and Exchange  Commission,
any state securities  commission or any other  regulatory  authority of any stop
order or of any order preventing or suspending any offering of any securities of
the Company,  or of the suspension of the  qualification  of the common stock of
the Company for offering or sale in any  jurisdiction,  or the initiation of any
proceeding for any such purpose.

                           (b) The Company shall promptly  secure the listing of
the Company  Shares and Common Stock  issuable upon the exercise of the Warrants
upon each national securities  exchange,  or automated quotation system, if any,
upon which shares of Common Stock are then listed (subject to official notice of
issuance) and shall  maintain such listing so long as any other shares of Common
Stock  shall be so listed,  such  listing of all Common  Stock from time to time
issuable upon exercise of the Put,  exercise of the Warrants and upon Reset. The
Company  will obtain and maintain the listing and trading of its Common Stock on
NASDAQ SmallCap,  and will comply in all respects with the Company's  reporting,
filing  and  other  obligations  under  the  bylaws  or  rules  of the  National
Association of Securities  Dealers  ("NASD") and such exchanges,  as applicable.
The Company shall promptly  provide to each  Purchaser  copies of any notices it
receives regarding the continued

<PAGE>



eligibility  of the Common  Stock for  listing on such  exchanges  or  quotation
systems,  or any other exchange or quotation system on which the Common Stock is
then listed.

                           (c) The  Company  shall  notify  the  SEC,  NASD  and
applicable  state  authorities,  in accordance with their  requirements,  of the
transactions  contemplated by this Agreement, and shall take all other necessary
action and  proceedings as may be required and permitted by applicable law, rule
and  regulation,  for the legal  and valid  issuance  of the  Securities  to the
Subscriber and promptly provide copies thereof to Subscriber.

                           (d)  Until  at  least   three  (3)  years  after  the
effectiveness  of  the  Registration   Statement  on  Form  S-3  or  such  other
Registration  Statement  described in Section 10.1(iv) hereof,  the Company will
use its  reasonable  efforts  (i) to cause its Common  Stock to  continue  to be
registered  under Sections 12(b) or 12(g) of the Exchange Act, (ii) to comply in
all respects with its reporting and filing  obligations under such Exchange Act,
and (iii) to comply with all requirements related to any registration  statement
filed pursuant to this  Agreement.  The Company will not take any action or file
any  document  (whether or not  permitted  by the Act or the Exchange Act or the
rules  thereunder) to terminate or suspend such  registration or to terminate or
suspend  its  reporting  and  filing  obligations  under  said  Acts,  except as
permitted  herein,  until the earlier of (i) three (3) years after the effective
date of the  Registration  Statement  on Form  S-3 or  such  other  Registration
Statement  described  in  Section  10.1(iv)  hereof,  or  (ii)  the  sale by the
Subscribers  and Placement  Agents of all the shares of common stock issuable by
the Company pursuant to this Agreement. Until at least three (3) years after the
Warrants have been converted into Common Stock, the Company will take all action
within its power to  continue  the  listing  or  trading of its Common  Stock on
NASDAQ  SmallCap and will comply in all respects with the  Company's  reporting,
filing and other obligations under the bylaws or rules of the NASD and NASDAQ.

                           (e) The Company and  Subscriber  agree that until the
Company  either obtains  shareholder  approval of the issuance of the Securities
and Placement Shares, or an exemption from NASDAQ's  corporate  governance rules
as they may apply to the foregoing, if such approval or exemption is required in
the reasonable opinion of the Subscriber,  the Company may not exercise the Put.
The  Company  represents  that  the  Section  7.1(e)  Shares  designated  on the
signature  page hereto,  together with the aggregate of such amounts  designated
for  all  investors  in the  $2,500,000  offering  to  which  this  Subscription
Agreement relates, and together with all Placement Shares issuable in connection
with the  $2,500,000  offering,  is not  greater  than  19.99% of the  shares of
Company's common stock  outstanding on the Closing Date. The Company  undertakes
to obtain the  approval of its  shareholders  required  pursuant to the NASDAQ's
corporate governance rules to allow issuance of all the Securities and Placement
Shares.  The Company covenants to obtain the shareholder  approval no later than
90 days from the Closing Date.

                  7.2.  Covenants of Subscriber.  The  Subscriber  covenants and
agrees with the Company as follows:

                           (a) The  Subscriber  will  provide for itself and any
beneficial  holder  of the  Securities,  information  and  documents  reasonably
required by the Company for the Company to
<PAGE>



comply  with its  governmental  and  regulatory  obligations  including  but not
limited  to  the  Securities  and  Exchange  Commission,  blue  sky  and  NASDAQ
requirements.

                           (b) The  Subscriber  will not directly or  indirectly
engage in the  uncovered  short selling of the Common Stock until 180 days after
the Closing Date.

                  8.   Covenants  of  the  Company  and   Subscriber   Regarding
Indemnifications.

                           (a) The Company  agrees to indemnify,  hold harmless,
reimburse and defend Subscriber  against any claim,  cost,  expense,  liability,
obligation,  loss or damage  (including  reasonable  legal  fees) of any nature,
incurred by or imposed upon Subscriber which results,  arises out of or is based
upon (i) any  misrepresentation  by Company or breach of any warranty by Company
in this Agreement or in any Exhibits or Schedules attached hereto, or Reports or
other  Written  Information;  or (ii) any breach or default  in  performance  by
Company of any covenant or undertaking to be performed by Company hereunder.

                           (b)  Subscriber  agrees to indemnify,  hold harmless,
reimburse and defend the Company at all times against any claim, cost,  expense,
liability,  obligation,  loss or damage (including reasonable legal fees) of any
nature,  incurred by or imposed upon the Company which results, arises out of or
is based upon (a) any  misrepresentation  by Subscriber in this  Agreement or in
any  Exhibits  or  Schedules  attached  hereto;  or (b) any breach or default in
performance  by  Subscriber  of any covenant or  undertaking  to be performed by
Subscriber hereunder.

                  9.1.     Reset.

                           (a) The  amount of  Company  Shares  issuable  to the
Subscriber  shall be  redetermined  from time to time as  described  herein (the
"Reset") and if appropriate,  additional shares of Common Stock (the "Additional
Shares") will be issued and delivered to the Subscriber as provided herein.  The
original  purchase  price set forth on the signature  page of this  Subscription
Agreement (the  "Purchase  Price") shall be deemed the purchase price of all the
shares of Common Stock to be delivered pursuant to this Subscription  Agreement.
Provided  the  Additional  Shares are  issued  after the  effective  date of the
Registration  Statement  described in Section 10.1(iv)  hereof,  such Additional
Shares will be  free-trading  on the books and records of the Company and issued
without restrictive legend.

                           (b)  The  Reset  shall  be  determined  on the  dates
identified below (each a "Reset Date") for an amount of the Purchase Price equal
to not less  than  10% and not  more  than  25% of the  Purchase  Price,  at the
Subscriber's election  ("Designated  Portion") per Reset Date. The initial Reset
Date shall be the  effective  date of the  Registration  Statement  described in
Section 10.1(iv) of this Subscription  Agreement or at the Subscriber's election
on the 180th day after the Closing Date if the Registration  Statement  required
to be filed pursuant to Section 10.1(iv) hereof has not been declared  effective
by the  Securities  and  Exchange  Commission  on such  date  ("Trigger  Date").
Subsequent Reset Dates shall be on the 30th, 60th, 90th,  120th,  150th,  180th,
210th,  240th, and 270th day following the Trigger Date. If any such date is not
a trading day on the NASDAQ 
<PAGE>



SmallCap Market,  then the Reset Date shall be the first trading day thereafter.
In the event any portion of the Common Shares comprising the Registration Escrow
(as  hereinafter  defined)  is  released  to the  Company  pursuant  to  Section
10.1(iv), then the aggregate Designated Portions of the Purchase Price shall not
be greater than that portion of the  Purchase  Price set forth on the  signature
page to this Subscription  Agreement less the  corresponding  amount of Purchase
Price  returned  to the  Subscriber.  In no event may the  aggregate  Designated
Portions  of the  Purchase  Price  exceed the  Purchase  Price.  To the extent a
Registration  Escrow is held in escrow on a Reset Date,  then such Common Shares
issuable in connection with such Registration Escrow will be deposited in escrow
to be held pursuant to the Funds Escrow Agreement.

                           (c) On each  Reset  Date a number of  Company  Shares
will be calculated for the Designated  Portion of the Purchase Price by dividing
the Designated  Portion of the Purchase Price by a number equal to seventy-seven
percent  (77%) of the  average  closing  bid prices for the Common  Stock on the
NASDAQ SmallCap Market, or on any securities exchange or other securities market
on which the  Common  Stock is then  being  traded,  for the five  trading  days
immediately preceding,  but not including, the Reset Date (the "Average Price").
If the Average  Price is less than the Issue Price  designated  on the signature
page hereto,  then the Company will issue to the Subscriber the number of shares
of Common Stock  obtained by  subtracting  (y) the number of shares  obtained by
dividing the  Designated  Portion of Purchase  Price by the Issue Price from (z)
the number of shares  obtained by dividing  the  Designated  Portion of Purchase
Price by the Average Price.

                           (d) In the event the Average  Price  calculated  on a
Reset Date is more than 130% but less than 200% of the Issue Price,  then 20% of
the Purchase Price will no longer be subject to Reset.  In the event the Average
Price calculated on a Reset Date is 200% or more than the Issue Price,  then 50%
of the Purchase Price shall no longer be subject to Reset.

                           (e) In no event will the  Subscriber  be  required to
return any Company Shares to the Company.  Each Reset  calculation shall be made
independent of all other Reset calculations.

                           (f) The  Company  agrees to  deliver  the  Additional
Shares to the Subscriber in hand, or Redemption  Amount (as defined herein),  if
such payment of the Redemption Amount is permitted hereunder,  no later than ten
(10) business days after notice from the  Subscriber of the  Designated  Portion
amount  (the  "Delivery  Date").  The  Company  understands  that a delay in the
delivery of either the  Additional  Shares or failure to deliver the  Redemption
Amount  described in Sections 9.2 and 9.3 beyond the Delivery  Date could result
in economic loss to the  Subscriber.  As compensation to the Subscriber for such
loss, the Company agrees to pay as liquidated damages payments to the Subscriber
for late delivery of Additional  Shares or Redemption Amount beyond the Delivery
Date,  in the amount of $100 per business  day after the Delivery  Date for each
$10,000  of  Designated  Portion  of  Purchase  Price for which a Reset has been
calculated.  Additionally, in the case of late payment of the Redemption Amount,
the Company will pay on additional sum equal to 10% of the Designated Portion of
the  Purchase  Price.  The Company  shall pay any payments  incurred  under this
Section in immediately  available  funds upon demand.  The late payment  charges
described 
<PAGE>



in this Section 9.1(f) shall be payable  through the date the Additional  Shares
or Redemption Amount is received in hand by the Subscriber.

                           (g) Company  Shares as defined  and  employed in this
Subscription Agreement shall mean and include Additional Shares for all purposes
including but not limited to Section 10 of this Subscription Agreement.

                           (h)  Nothing  contained  herein  or in  any  document
referred to herein shall be deemed to establish or require the payment of a rate
of interest or other  charges in excess of the maximum  permitted by  applicable
law.  In the event a rate of  interest  required  or imputed to be paid or other
charges  hereunder  exceed the maximum  permitted  by such law,  any payments in
excess of such maximum shall be credited  against amounts owed by the Company to
the Subscriber and thus refunded to the Company.

                  9.2. Optional Redemption. In the event the average closing bid
price for the Common  Stock on NASDAQ  SmallCap  or any  securities  exchange or
other  securities  market on which the Common Stock is then being traded for the
five  trading  days  immediately  preceding,  but not  including  a  Reset  Date
("Redemption  Price")  is less  than  $2.50  per  share,  then at the  Company's
election,  in lieu of delivering the Additional Shares on the Delivery Date, the
Company  may  deliver  on  the  Delivery  Date  a sum  of  money  determined  by
multiplying  the  number of  Additional  Shares  otherwise  deliverable,  by the
Redemption Price  ("Redemption  Amount").  In the event the Additional Shares or
payment of the  Redemption  Amount is not received by the Subscriber in US funds
on or before a Delivery  Date,  then the Company  shall no longer have the right
described in this  paragraph to  substitute  cash payment in lieu of delivery of
Additional  Shares.  As a precondition to exercising the right to substitute the
Redemption  Amount in lieu of  delivering  Additional  Shares,  the Company must
notify the  Subscriber  in writing of its  intention  to do so no later than ten
(10) business days after notice from the  Subscriber of the  Designated  Portion
Amount.

                  9.3.  Mandatory  Redemption.  In the event the Company may not
issue Additional Shares on a Reset Date because such issuance and delivery would
be contrary to NASDAQ's  Corporate  Governance  Rules,  or for any other reason,
then the Company must pay to the  Subscriber on the Delivery Date the Redemption
Amount calculated as described in Section 9.2 hereof.

                  10. Registration Rights; Procedure; Indemnification.

                  10.1.  Registration  Rights.  The  Company  hereby  grants the
following registration rights to holders of the Company Shares and the Warrants.

                                    (i) On one occasion, for a period commencing
61 days after the  Closing  Date,  but not later than three  years from the date
hereof,  the Company,  upon a written request therefor from any record holder or
holders of more than 50% of the  aggregate  of the  Company's  Shares and Common
Stock  issuable  upon  exercise of the Warrants  (the  Securities  and Placement
Shares  and  securities  issued  or  issuable  by  virtue  of  ownership  of the
Securities and Placement  Shares being,  the  "Registrable  Securities"),  shall
prepare and file with the SEC a 

<PAGE>

registration  statement under the Act covering the Registrable  Securities which
are the subject of such  request,  unless such  Registrable  Securities  are the
subject of an effective registration statement. In addition, upon the receipt of
such request, the Company shall promptly give written notice to all other record
holders of the Registrable  Securities that such registration statement is to be
filed and shall include in such registration  statement  Registrable  Securities
for which it has  received  written  requests  within 10 days after the  Company
gives such written notice.  Such other requesting record holders shall be deemed
to have exercised their demand  registration right under this Section 10.1. As a
condition  precedent to the  inclusion  of  Registrable  Securities,  the holder
thereof  shall  provide  the  Company  with  such  information  as  the  Company
reasonably  requests.  The obligation of the Company under this Section  10.1(i)
shall be limited to one registration statement.

                                    (ii) If the Company at any time  proposes to
register any of its securities under the Act for sale to the public, whether for
its own account or for the  account of other  security  holders or both,  except
with respect to  registration  statements  on Forms S-4, S-8 or another form not
available for  registering  the  Registrable  Securities for sale to the public,
provided the Registrable  Securities are not otherwise  registered for resale by
the Subscriber pursuant to an effective registration  statement,  each such time
it will give at least 10 days' prior written  notice to the record holder of the
Registrable  Securities of its  intention so to do. Upon the written  request of
the holder,  received by the Company within 10 days after the giving of any such
notice by the  Company,  to  register  any of the  Registrable  Securities,  the
Company will cause such Registrable  Securities as to which  registration  shall
have been so requested to be included  with the  securities to be covered by the
registration  statement  proposed to be filed by the Company,  all to the extent
required to permit the sale or other  disposition of the Registrable  Securities
so registered by the holder of such  Registrable  Securities (the "Seller").  In
the event that any  registration  pursuant to this Section 10.1(ii) shall be, in
whole or in  part,  an  underwritten  public  offering  of  common  stock of the
Company,  the number of shares of Registrable  Securities to be included in such
an underwriting may be reduced by the managing  underwriter if and to the extent
that the Company and the  underwriter  shall  reasonably  be of the opinion that
such inclusion would adversely affect the marketing of the securities to be sold
by the Company  therein;  provided,  however,  that the Company shall notify the
Seller  in  writing  of  any  such  reduction.   Notwithstanding   the  forgoing
provisions,  the Company may withdraw any registration  statement referred to in
this Section 10.1(ii) without thereby incurring any liability to the Seller.

                                    (iii)  If, at the time any  written  request
for  registration is received by the Company  pursuant to Section  10.1(i),  the
Company has  determined to proceed with the actual  preparation  and filing of a
registration  statement under the 1933 Act in connection with the proposed offer
and sale for cash of any of its securities  for the Company's own account,  such
written request shall be deemed to have been given pursuant to Section  10.1(ii)
rather  than  Section  10.1(i),  and the rights of the  holders  of  Registrable
Securities covered by such written request shall be governed by Section 10.1(ii)
except  that  the  Company  or  underwriter,  if  any,  may  not  withdraw  such
registration  or limit the amount of  Registrable  Securities  included  in such
registration.

                                    (iv)  The   Company   shall  file  with  the
Commission,  within sixty (60) days of the Closing Date,  and use its reasonable
commercial efforts to cause to be declared effective

<PAGE>



a Form SB-2  registration  statement  (or such other form that it is eligible to
use) in order to register the Registrable Securities for resale and distribution
under the Act. The  registration  statement  described in this paragraph must be
declared  effective by the  Commission  within 120 days of the Closing Date. The
Company  will  register  not less than 8,889  shares of Common Stock in the SB-2
registration  statement  for each $10,000 of Purchase  Price as set forth on the
signature  page  hereto  and one share of Common  Stock for each share of Common
Stock  issuable  upon  exercise of the  Warrants  and one common  share for each
Placement  Share.  These shares to be registered shall be reserved and set aside
exclusively for the benefit of the Subscriber and Placement  Agents, as the case
may be,  and not  issued,  employed  or  reserved  for  anyone  other  than  the
Subscriber and Placement  Agents, as the case may be. It is the intention of the
parties that the registration  statement include the Additional Shares described
in  Section 9 hereof  and the Put Shares  described  in Section 11 hereof.  Such
registration  statement  will be  promptly  amended or  additional  registration
statements  will be  promptly  filed by the  Company as  necessary  to  register
additional  shares of Common Stock issuable upon Reset.  Thirty percent (30%) of
the Purchase  Price,  and up to thirty  percent  (30%) of the Common  Shares and
thirty percent (30%) of the Warrants purchased by the Subscriber as set forth on
the signature  page of this  Subscription  Agreement and thirty percent (30%) of
the  Placement  Shares  shall be held in escrow  pursuant  to the  Funds  Escrow
Agreement  annexed  hereto as Exhibit B until the  acceptance  for filing by the
Securities and Exchange  Commission of the registration  statement  described in
this  Section  10.1(iv) and  obtainment  of the  shareholder  approval or NASDAQ
exemption  described in Section 7.1(e) hereof  ("Registration  Escrow").  In the
event the registration  statement relating to the Registrable  Securities is not
filed within 60 days from the Closing Date or the shareholder approval or NASDAQ
exemption  described in Section 7.1(e) hereof is not obtained  within 90 days of
the  Closing  Date,  then  the  Registration  Escrow  shall  be  employed  as  a
non-exclusive  remedy,  to pay the damages  described in Section 10.2(j) of this
Subscription  Agreement.  In the event the  Registration  Statement is not filed
within 60 days from the  Closing  Date,  and/or if the  Company  fails to obtain
within 90 days of the Closing Date, the  shareholder  approval or exemption from
NASDAQ's  Corporate  Governance  Rules as  described in Section  7.1(e)  hereof,
unless  otherwise  agreed to in writing by the  Subscriber,  then thirty percent
(30%) of the  Purchase  Price  shall be released  to the  Subscriber,  and up to
thirty percent (30%) of the Common Shares,  thirty percent (30%) of the Warrants
and thirty  percent  (30%) of the  Placement  Shares  shall be  returned  to the
Company.  In such  event  the  Company  shall  not be  released  from any of its
obligations  under this  Subscription  Agreement or any  agreement  delivered in
connection herewith including the Company's obligations pursuant to this Section
10 and Reset provisions  described in Section 9 of this  Subscription  Agreement
except  that the  Company  shall no longer be  required  to file a  registration
statement in connection with only those  Securities  released to the Company and
damages  shall not accrue to the  Subscriber  in relation  to the Common  Shares
released to the Company from and after the date the corresponding portion of the
Purchase  Price is  returned  to the  Subscriber.  To the extent any part of the
Purchase Price portion of the  Registration  Escrow is released to a Subscriber,
then that portion of the Registration Escrow may, at the Subscriber's  election,
first be applied in  satisfaction  of payment by the Company of sums  payable to
such Subscriber pursuant to Section 9.1(f) and Section 10.2(j) hereof.  Anything
to the contrary herein or in the Shares Escrow  Agreement  notwithstanding,  the
Company Shares component of the Registration  Escrow will not be released to the
Company  until  all  outstanding  monetary  obligations  to the  Subscriber  are
satisfied.  Within ten (10) business days of receipt of shareholder  approval or
NASDAQ exemption described in Secton

<PAGE>



7.1(e)  hereof,  the Company agrees to deliver  additional  Common Shares to the
Escrow Agent,  to be held pursuant to the Shares Escrow  Agreement  representing
the balance of the Common Shares portion of the Registration  Escrow so that the
Escrow Agent will be in  possession  of Common  Shares  representing  30% of the
aggregate  Common Shares  Purchased  designated  on the  signature  page hereto.
Failure by the Company to timely  deposit such  additional  shares will void the
Company's  right to receive a  proportionate  amount of the funds portion of the
Registration Escrow.  Releases of the components of the Registration Escrow will
be in proportion to the amount of Common Stock held by the Escrow Agent.

                  10.2. Registration Procedures.  If and whenever the Company is
required by the provisions  hereof to effect the  registration  of any shares of
Registrable  Securities  under the Act, the Company  will, as  expeditiously  as
possible:

                           (a)   prepare   and  file  with  the   Commission   a
registration  statement with respect to such securities and use its best efforts
to cause such  registration  statement  to become and remain  effective  for the
period of the  distribution  contemplated  thereby  (determined  as  hereinafter
provided);

                           (b)  prepare  and  file  with  the  Commission   such
amendments  and  supplements to such  registration  statement and the prospectus
used in  connection  therewith  as may be  necessary  to keep such  registration
statement  effective for the period  specified in paragraph (a) above and comply
with the  provisions  of the Act with respect to the  disposition  of all of the
Registrable Securities covered by such registration statement in accordance with
the  Seller's  intended  method of  disposition  set forth in such  registration
statement for such period;

                           (c) furnish to the Seller, and to each underwriter if
any,  such number of copies of the  registration  statement  and the  prospectus
included  therein  (including  each  preliminary  prospectus)  as  such  persons
reasonably  may  request  in  order  to  facilitate  the  public  sale or  their
disposition of the securities covered by such registration statement;

                           (d) use its best  efforts to  register or qualify the
Seller's Registrable Securities covered by such registration statement under the
securities  or "blue  sky" laws of such  jurisdictions  as the Seller or, in the
case  of  an  underwritten  public  offering,  the  managing  underwriter  shall
reasonably request,  provided,  however, that the Company shall not for any such
purpose be  required  to qualify  generally  to  transact  business as a foreign
corporation  in any  jurisdiction  where it is not so qualified or to consent to
general service of process in any such jurisdiction;

                           (e) list the Registrable  Securities  covered by such
registration statement with any securities exchange on which the Common Stock of
the Company is then listed;

                           (f)   immediately   notify   the   Seller   and  each
underwriter  under such  registration  statement  at any time when a  prospectus
relating  thereto is required to be delivered under the Act, of the happening of
any event of which the Company has knowledge as a result of which the prospectus
contained in such registration  statement, as then in effect, includes an untrue
statement 
<PAGE>



of a  material  fact or omits to state a  material  fact  required  to be stated
therein or necessary to make the  statements  therein not misleading in light of
the circumstances then existing;

                           (g) make available for inspection by the Seller,  any
underwriter  participating  in any  distribution  pursuant to such  registration
statement, and any attorney, accountant or other agent retained by the Seller or
underwriter,  all financial and other records, pertinent corporate documents and
properties  of the Company,  and cause the  Company's  officers,  directors  and
employees  to  supply  all  information  reasonably  requested  by  the  seller,
underwriter,  attorney, accountant or agent in connection with such registration
statement.

                           (h) at the request of the  Seller,  provided a demand
for  registration  has been made  pursuant  to Section  10.1(i) or a request for
registration  has been  made  pursuant  to  Section  10.1(ii),  the  Registrable
Securities  will be included in a registration  statement filed pursuant to this
Section 10. In the event of a firm  commitment  underwritten  public offering in
which the Registrable  Securities are so included, the lockup, if any, requested
by the managing  underwriter may not exceed ninety (90) days after the effective
date thereof.

                           (i) In connection with each  registration  hereunder,
the Seller will furnish to the Company in writing such  information with respect
to itself and the proposed  distribution by it as reasonably  shall be necessary
in order to assure compliance with federal and applicable state securities laws.
In connection  with each  registration  pursuant to Section  10.1(i) or 10.1(ii)
covering an underwritten  public  offering,  the Company and the Seller agree to
enter into a written  agreement  with the managing  underwriter in such form and
containing such provisions as are customary in the securities  business for such
an arrangement  between such underwriter and companies of the Company's size and
investment stature.

                           (j) The  Company  and the  Subscriber  agree that the
Seller will suffer damages if any registration  statement required under Section
10.1(i)  or  10.1(ii)  above is not filed  within 45 days  after  request by the
Holder and not declared  effective by the Commission  within 130 days after such
request  [or 60 days and 120  days,  respectively,  after  the  Closing  Date in
reference  to the  Registration  Statement  on  Form  SB-2 or  such  other  form
described in Section 10.1(iv)], and maintained in the manner and within the time
periods  contemplated  by  Section 10 hereof,  and it would not be  feasible  to
ascertain  the extent of such damages with  precision.  Accordingly,  if (i) the
Registration  Statement  described in Sections  10.1(i) or 10.1(ii) is not filed
within 45 days of such request,  or is not declared  effective by the Commission
on or  prior  to the  date  that is 130 days  after  such  request,  or (ii) the
registration  statement  on Form SB-2 or such  other form  described  in Section
10.1(iv)  is not filed  within 60 days after the  Closing  Date or not  declared
effective  within  120  days of the  Closing  Date,  or (iii)  any  registration
statement  described  in  Sections  10.1(i),  10.1(ii)  or 10.1(iv) is filed and
declared  effective but shall  thereafter  cease to be effective  (without being
succeeded immediately by an additional registration statement filed and declared
effective)  for a period of time which shall exceed 30 days in the aggregate per
year but not more than 20 consecutive  calendar days (defined as a period of 365
days commencing on the date the  Registration  Statement is declared  effective)
(each such event  referred  to in clauses  (i),  (ii) and (iii) of this  Section
10.2(j) is referred to herein as a "Non-Registration  Event"), then, for so long
as such Non-Registration Event 

<PAGE>

shall  continue,  the Company  shall pay in cash as  Liquidated  Damages to each
holder of any  Securities  an amount equal to three (3%)  percent per month,  or
part thereof,  of the Purchase  Price of the Company Shares then owned of record
by  such  holder  as  of   immediately   following   the   occurrence   of  such
Non-Registration   Event,  unless  such   Non-Registration   Event  arises  from
Subscriber's material default of Subscriber's obligations hereunder. Payments to
be made pursuant to this Section  10.2(j)  shall be due and payable  immediately
upon demand in immediately  available funds. The Subscriber may elect to satisfy
any outstanding  Company obligations arising under Section 9.1(f) hereof or this
Section  10.2(j) by  demanding  the  release  from  escrow of cash funds  and/or
Company Shares at a per share value equivalent to 75% of the lowest bid price of
the  Company's  Common  Stock on NASDAQ  SmallCap  or on any  exchange  or other
securities  market on which the Common Stock is then being traded,  for the five
trading days prior to the date notice of such  election is given to the Company.
The  Liquidated  Damages  payable in  connection  with the initial 60 day period
after the  occurrence of a  Non-Registration  Event arising from a  Registration
Statement  required  pursuant  to Section  10.1(iv)  hereof  not being  declared
effective by the Commission on or before 120 days after the Closing Date, may be
paid by the  Company,  at its  option,  in  common  stock at a per  share  value
equivalent  to 75% of the  lowest  bid price of the  Company's  Common  Stock on
NASDAQ  SmallCap  or on any  exchange  or other  securities  market on which the
Common  Stock is then being  traded,  for the five trading  days  preceding  the
effective date of the Registration  Statement or the 180th day after the Closing
Date,  whichever  is sooner.  The Company  agrees to deliver to  Subscriber  the
Common Stock  deliverable  in  satisfaction  of Company's  monetary  obligations
described in this Section 10.2(j) within five business days after written demand
by  Subscriber.  Common  Shares  delivered  to  Subscriber  in  satisfaction  of
Company's  monetary  obligations are granted all  registration  rights described
herein,  including  but not  limited to the  registration  rights  described  in
Section 10.1(iv) hereof.

                  10.3.  Expenses.  All  expenses  incurred  by the  Company  in
complying with Section 10, including,  without limitation,  all registration and
filing  fees,   printing  expenses,   fees  and  disbursements  of  counsel  and
independent  public  accountants for the Company,  fees and expenses  (including
counsel fees) incurred in connection  with  complying  with state  securities or
"blue sky" laws, fees of the National  Association of Securities Dealers,  Inc.,
transfer taxes, fees of transfer agents and registrars,  fee of one counsel,  if
any,  to  represent  all  the  Sellers,   and  costs  of  insurance  are  called
"Registration  Expenses".  All  underwriting  discounts and selling  commissions
applicable  to the  sale of  Registrable  Securities,  including  any  fees  and
disbursements  of  any  special  counsel  to the  Seller,  are  called  "Selling
Expenses". The Seller shall pay the fees of its own additional counsel, if any.

                  The Company will pay all  Registration  Expenses in connection
with the  registration  statement  under  Section  10. All  Selling  Expenses in
connection with each  registration  statement under Section 10 shall be borne by
the Seller in proportion to the number of shares sold by the Seller  relative to
the number of shares sold under such  registration  statement  or as all Sellers
thereunder may agree.
<PAGE>



                  10.4.    Indemnification and Contribution.

                           (a) In the event of a registration of any Registrable
Securities  under the Act pursuant to Section 10, the Company will indemnify and
hold  harmless  the Seller,  each  officer of the Seller,  each  director of the
Seller,  each  underwriter of such  Registrable  Securities  thereunder and each
other person, if any, who controls such Seller or underwriter within the meaning
of the 1933 Act, against any losses,  claims,  damages or liabilities,  joint or
several,  to which the Seller,  or such  underwriter or  controlling  person may
become  subject  under the Act or  otherwise,  insofar as such  losses,  claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue  statement or alleged  untrue  statement  of any  material  fact
contained in any registration  statement under which such Registrable Securities
was registered under the Act pursuant to Section 10, any preliminary  prospectus
or final prospectus  contained therein,  or any amendment or supplement thereof,
or arise out of or are based  upon the  omission  or alleged  omission  to state
therein a material fact  required to be stated  therein or necessary to make the
statements  therein not  misleading,  and will  reimburse the Seller,  each such
underwriter  and each such  controlling  person for any legal or other  expenses
reasonably  incurred by them in connection with  investigating  or defending any
such loss,  claim,  damage,  liability or action;  provided,  however,  that the
Company  will not be liable in any such case if and to the extent  that any such
loss,  claim,  damage  or  liability  arises  out of or is based  upon an untrue
statement or alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by any such Seller, the underwriter or any
such controlling  person in writing  specifically  for use in such  registration
statement or prospectus.

                           (b)  In the  event  of a  registration  of any of the
Registrable  Securities  under the Act  pursuant  to Section 10, the Seller will
indemnify and hold harmless the Company,  and each person,  if any, who controls
the Company within the meaning of the Act, each officer of the Company who signs
the registration  statement,  each director of the Company, each underwriter and
each person who controls any underwriter  within the meaning of the Act, against
all losses,  claims,  damages or  liabilities,  joint or  several,  to which the
Company or such officer, director,  underwriter or controlling person may become
subject under the Act or otherwise,  insofar as such losses,  claims, damages or
liabilities  (or actions in respect  thereof) arise out of or are based upon any
untrue  statement or alleged untrue  statement of any material fact contained in
the  registration   statement  under  which  such  Registrable  Securities  were
registered  under the Act pursuant to Section 10, any preliminary  prospectus or
final prospectus  contained therein,  or any amendment or supplement thereof, or
arise out of or are based upon the omission or alleged omission to state therein
a  material  fact  required  to be  stated  therein  or  necessary  to make  the
statements therein not misleading,  and will reimburse the Company and each such
officer,  director,  underwriter and  controlling  person for any legal or other
expenses  reasonably  incurred  by  them in  connection  with  investigating  or
defending any such loss, claim, damage, liability or action, provided,  however,
that the  Seller  will be liable  hereunder  in any such case if and only to the
extent that any such loss, claim,  damage or liability arises out of or is based
upon an untrue  statement  or alleged  untrue  statement  or omission or alleged
omission made in reliance upon and in conformity with information  pertaining to
such  Seller,  as such,  furnished  in  writing to the  Company  by such  Seller
specifically for use in such registration statement or prospectus, and provided,
further,  however, that the liability of the Seller hereuder shall be limited to
the proportion of any such loss,  claim,  damage,  liability or expense which is
equal to the proportion

<PAGE>



that the public offering price of the Registrable  Securities sold by the Seller
under such  registration  statement  bears to the total public offering price of
all  securities  sold  thereunder,  but not in any  event to  exceed  the  gross
proceeds received by the Seller from the sale of Registrable  Securities covered
by such registration statement.

                           (c) Promptly  after receipt by an  indemnified  party
hereunder of notice of the commencement of any action,  such  indemnified  party
shall,  if a claim in respect  thereof is to be made  against  the  indemnifying
party  hereunder,  notify the  indemnifying  party in writing  thereof,  but the
omission  so to notify  the  indemnifying  party  shall not  relieve it from any
liability  which it may have to such  indemnified  party  other  than under this
Section  10.4(c) and shall only relieve it from any liability  which it may have
to such  indemnified  party under this Section  10.4(c) if and to the extent the
indemnifying party is prejudiced by such omission. In case any such action shall
be brought  against any indemnified  party and it shall notify the  indemnifying
party of the commencement  thereof,  the indemnifying party shall be entitled to
participate  in and, to the extent it shall wish,  to assume and  undertake  the
defense thereof with counsel  satisfactory to such indemnified party, and, after
notice from the indemnifying  party to such indemnified party of its election so
to assume and undertake the defense thereof, the indemnifying party shall not be
liable to such  indemnified  party  under  this  Section  10.4(c)  for any legal
expenses  subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation and of liaison with
counsel so selected,  provided,  however,  that,  if the  defendants in any such
action include both the  indemnified  party and the  indemnifying  party and the
indemnified  party shall have reasonably  concluded that there may be reasonable
defenses  available  to it  which  are  different  from or  additional  to those
available to the indemnifying party or if the interests of the indemnified party
reasonably  may be deemed to conflict  with the  interests  of the  indemnifying
party,  the  indemnified  parties  shall have the right to select  one  separate
counsel and to assume such legal  defenses and otherwise to  participate  in the
defense of such action,  with the  reasonable  expenses and fes of such separate
counsel and other expenses related to such participation to be reimbursed by the
indemnifying party as incurred.

                           (d) In  order  to  provide  for  just  and  equitable
contribution  in the event of joint liability under the Act in any case in which
either (i) the Seller,  or any controlling  person of the Seller,  makes a claim
for  indemnification  pursuant  to  this  Section  10.4  but  it  is  judicially
determined  (by the entry of a final  judgment or decree by a court of competent
jurisdiction  and the  expiration  of time to appeal  or the  denial of the last
right of appeal)  that such  indemnification  may not be  enforced  in such case
notwithstanding  the fact that this Section 10.4 provides for indemnification in
such case, or (ii) contribution under the Act may be required on the part of the
Seller  or  controlling   person  of  the  Seller  in  circumstances  for  which
indemnification  is provided  under this Section  10.4;  then,  and in each such
case,  the Company  and the Seller  will  contribute  to the  aggregate  losses,
claims,  damages or liabilities to which they may be subject (after contribution
from others) in such  proportion so that the Seller is responsible  only for the
portion  represented  by the  percentage  that the public  offering price of its
securities  offered by the  registration  statement bears to the public offering
price  of all  securities  offered  by such  registration  statement,  provided,
however,  that,  in any  such  case,  (A) the  Seller  will not be  required  to
contribute  any  amount  in  excess  of the  public  offering  price of all such
securities  offered by it pursuant to such  registration  statement;  and (B) no
person or entity guilty

<PAGE>



of fraudulent misrepresentation (within the meaning of Section 10(f) of the Act)
will be entitled to contribution from any person or entity who was not guilty of
such fraudulent misrepresentation.

                  11.1.    Future Offerings.

                           (a) Offering  Restriction.  Until the later of (i) 90
days after the effective date of the SB-2  Registration  Statement or such other
form of registration statement described in Section 10.1(iv) hereof, or (ii) 270
days  after the  Closing  Date,  and so long as  Subscriber  is not in  material
default under Section 11.2, the Company and its subsidiaries  will not issue any
equity,  or convertible  debt or other securities other than pursuant to Section
11.1(b)  without  the  consent of the  Subscribers  investing  a majority of the
Purchase Price of the  subscriptions  in the  $2,500,000  offering to which this
Subscription  Agreement  relates,  if such offering would or could result in the
issuance of Common  Stock or any other  security  of the  Company  that would be
freely tradable on the books of the Company,  with or without  registration with
the  Securities  and Exchange  Commission or in reliance on any  exemption  from
registration  prior  to 90 days  after  the  effective  date  of a  Registration
Statement  described  in  Sections  10.1(i)  or  10.1(iv)  relating  to all  the
Registrable Securities.

                           (b)  Right of  First  Refusal.  Until  the end of the
period  described in Section  11.1(a) above,  the Subscriber  shall be given not
less than ten (10) business  days prior  written  notice of any proposed sale by
the Company of its common stock or other  securities,  other than any investment
in the Company in exchange for  securities of the Company that may not either be
registered pursuant to the 1933 Act for at least 270 days after the date of such
investment  or resold for at least 270 days  after the date of such  investment.
The Subscriber  shall have the right during the ten (10) business days following
the  notice  to agree to  purchase  an  amount  of  Company  Shares  in the same
proportion  as  being  purchased  in  the  aggregate   offering  to  which  this
Subscription  Agreement  relates (i.e.  $2,500,000 in the  aggregate),  of those
securities  proposed  to be issued and sold,  in  accordance  with the terms and
conditions  set  forth in the  notice  of sale.  In the  event  such  terms  and
conditions are modified during the notice period,  the Subscriber shall be given
prompt notice of such  modification and shall have the right during the original
notice period or for a period of ten (10) business days  following the notice of
modification, whichever is longer, to exercise such right.

                  11.2.    Obligation To Purchase.

                           (a)  The  Subscriber  agrees  to  purchase  from  the
Company  additional shares of common stock of the Company (the "Put Shares") for
the aggregate consideration designated on the signature page hereof (the "Put").
The Put may be  exercised  by the  Company  only  during the two (2) year period
commencing on the Closing Date ("Put Period").

                           (b) The  agreement  to  purchase  the Put  Shares  is
contingent on the Company  filing a registration  statement  relating to the Put
Shares  issuable  upon  exercise  of the Put with the  Securities  and  Exchange
Commission on Form S-3 or such other registration statement described in Section
10.1(iv)  of this  Subscription  Agreement  or another  form  suitable  for such
purpose and reasonably designated by the Purchaser on or before 60 days from the
Closing Date, and 

<PAGE>

such  registration  statement  being  declared  effective by the  Securities and
Exchange Commission on or before 120 days from the Closing Date.

                           (c) The exercise of the Put is further  contingent on
the following:

                                    (1)  As  of  the   effective   date  of  the
registration  statement  described  in  Section  11.2(b),  and the Put  Date (as
hereinafter  defined),  the Company  will be a full  reporting  company with the
class of Shares registered  pursuant to Section 12(g) of the Securities Exchange
Act of 1934.

                                    (2) The  Company's  Common  Stock  will have
traded at an  average  daily  trading  volume of 75,000  shares  for the  thirty
trading days prior to each Put Date with an average  daily  closing bid price of
not less than $1.00 per share for the same period.

                                    (3) The Company's  financial  condition will
be at least equivalent to the Company's  financial  condition as reported in the
Company's  most recent  financial  statements  included in the Reports and Other
Information.

                                    (4) None of the following  events of default
shall have occurred or be continuing:

                                    (i) The Company shall make an assignment for
the  benefit  of  creditors,  or apply for or consent  to the  appointment  of a
receiver  or  trustee  for it or for a  substantial  part  of  its  property  or
business; or such a receiver or trustee shall otherwise be appointed.

                                    (ii) Any  money  judgment,  writ or  similar
process  shall be entered or filed  against  Company or any of its  property  or
other  assets for more than  $50,000,  and shall remain  unvacated,  unbonded or
unstayed for a period of forty-five (45) days.

                                    (iii) Bankruptcy, insolvency, reorganization
or liquidation  proceedings or other  proceedings or relief under any bankruptcy
law or any law for the relief of debtors  shall be  instituted by or against the
Company.

                                    (iv)  Delisting  of  any  of  the  Company's
securities from the NASDAQ  SmallCap Market or such other principal  exchange on
which such security was listed for trading,  or receipt by the Company of notice
from  NASDAQ  or such  other  principal  exchange  that  the  Company  is not in
compliance with its listing requirements.

                                    (v) A concession by the Company or a default
by the Company under any one or more obligation in an aggregate  monetary amount
in excess of $50,000.

                                    (vi)  An SEC  stop  trade  order  or  NASDAQ
trading suspension.


<PAGE>



                                    (vii) Any  representation or warranty of the
Company made in this Subscription Agreement or in connection herewith, or in any
agreement,  statement  or  certificate  given in writing  pursuant  hereto or in
connection herewith shall be materially false or misleading.

                                    (viii) The occurrence of a  Non-Registration
Event.

                                    (ix) Any material  default by the Company of
any  covenant or  undertaking  described in this  Subscription  Agreement or any
document delivered in connection herewith.

                                    (5) A  Closing  shall  have  occurred  on an
aggregate  of  $2,500,000  on the same terms and  conditions  described  in this
Subscription Agreement.

                                    (6)  The Put  Shares  on the  Put  Date  (as
hereinafter  defined) will be  free-trading,  unrestricted,  unlegended  and not
subject to volume or other resale limitations.

                                    (7) The obtainment prior to 90 days from the
Closing Date of an exemption  from NASDAQ's  Corporate  Governance  Rules or the
approval of its  shareholders  of the issuance of the  Securities  and Placement
Shares as described in Section 7.1(e) hereof.

                           (d) The Subscriber is required to purchase Put Shares
within  ten (10)  business  days of notice by the  Company  that the  Company is
exercising the Put ("Put  Notice").  The date notice is given is the "Put Date".
The  Company's  right to give a Put Notice  expires  two years from the  Closing
Date. The Company may not give such notice more often than once each  twenty-one
(21)  calendar  days,  nor within five (5) business days before or after a Reset
Date or effective date of a reverse split of the Company's Common Stock.  Unless
otherwise  agreed  to by the  Subscribers,  Put  Notices  must be  given  to all
Subscribers in the same  proportion to the amounts agreed to be purchased by all
Subscribers  undertaking  to purchase Put Shares in the  $2,500,000  offering to
which this Subscription  Agreement relates. The aggregate amount of all such Put
Notices may not exceed $3,000,000.  Payment for the Put Shares will be made upon
receipt of the Put Shares by the  Subscriber or an escrow agent to be designated
by the Company and Subscriber.

                           (e) The  price  per  common  share for each Put Share
shall be 88% of the average closing bid prices of the Company's  Common Stock on
the NASDAQ SmallCap  Market,  or on any securities  exchange or other securities
market on which the Common Stock is then being traded, for the five trading days
commencing  two trading  days prior to the Put Date and ending two trading  days
after the Put Date (the "Put Price").

                           (f) The  aggregate  purchase  price of Put Shares for
which each Put Notice may be given to all Subscribers in the $2,500,000 offering
to which this Subscription Agreement relates, is as follows: 9/23/98

<PAGE>



Average Per Common      Average Daily                      Aggregate Dollar
Share Closing           Common Stock                       Purchase Price of
Bid Price For           Trading Volume For                 Put Shares For
15 Trading Days         15 Trading Days                    All Put Notices
Prior to Put Date       Prior to Put Date                  On a Put Date
-----------------       ------------------                 -----------------

Between $1.00           Not Less Than                      Up to $400,000
and $2.00               75,000 Common Shares

Between $2.00           Not Less Than                      Up to $600,000
and $3.00               75,000 Common Shares

More than $3.00         Not Less Than                      Up to $750,000
                        100,000 Common Shares

                           (g) The Put Price and  number of Common  Shares to be
issued pursuant to this Section shall be subject to adjustment from time to time
upon the happening of certain events while the Put right remains outstanding, as
follows:

                                    (1)   Stock   Splits,    Combinations    and
Dividends.  If the shares of Common  Stock are  subdivided  or  combined  into a
greater or smaller number of shares of Common Stock, or if a dividend is paid on
the  Common  Stock  in  shares  of  Common   Stock,   the  Put  Price  shall  be
proportionately  reduced in case of  subdivision  of shares or stock dividend or
proportionately  increased in the case of  combination  of shares,  in each such
case by the ratio which the total number of shares of Common  Stock  outstanding
immediately after such event bears to the total number of shares of Common Stock
outstanding immediately prior to such event.

                                    (2)   Share   Issuance.   Subject   to   the
provisions of this Section, if the Company at any time shall issue any shares of
Common Stock prior to the exercise of the aggregate Put amounts  (otherwise than
as  provided  in  Section  11.2(f)(1)  or  this  subparagraph  11.2(f)(2)  for a
consideration  less  than the Put Price  that  would be in effect at the time of
such issue,  then, and  thereafter  successively  upon each such issue,  the Put
Price  shall be reduced  as  follows:  (i) the number of shares of Common  Stock
outstanding immediately prior to such issue shall be multiplied by the Put Price
in  effect  at the  time of such  issue  and the  product  shall be added to the
aggregate  consideration,  if any,  received by the  Company  upon such issue of
additional shares of Common Stock; and (ii) the sum so obtained shall be divided
by the  number of shares of Common  Stock  outstanding  immediately  after  such
issue.  The resulting  quotient shall be the adjusted Put Price. For purposes of
this adjustment,  the issuance of any security of the Company carrying the right
to convert such security into shares of Common Stock or of any warrant, right or
option to purchase  Common Stock shall result in an  adjustment to the Put Price
upon the issuance of shares of Common Stock upon exercise of such  conversion or
purchase rights.

                           (h) The Company may not  exercise the Put without the
consent of the  Subscriber,  in connection  with that number of shares of Common
Stock which would be in excess

<PAGE>



of the sum of (i) the number of shares of Common Stock beneficially owned by the
Subscriber and its affiliates on the Closing Date, and (ii) the number of shares
of Common Stock  issuable upon the exercise of the Put with respect to which the
determination of this proviso is being made on a Put Date, which would result in
beneficial  ownership by the Subscriber and its affiliates of more than 4.99% of
the outstanding  shares of Common Stock of the Company.  For the purposes of the
proviso to the immediately  preceding  sentence,  beneficial  ownership shall be
determined in accordance  with Section 13(d) of the  Securities  Exchange Act of
1934, as amended, and Regulation 13d-3 thereunder,  except as otherwise provided
in clause (i) of such proviso.

                  12.      Miscellaneous.

                           (a)  Notices.  All  notices  or other  communications
given or made hereunder shall be in writing and shall be personally delivered or
deemed delivered the first business day after being telecopied  (provided that a
copy is delivered by overnight  courier) to the party to receive the same at its
address set forth below or to such other address as either party shall hereafter
give to the other by notice duly made under this Section: (i) if to the Company,
to The  Recovery  Network,  Inc.,  1411 5th  Street,  Suite 250,  Santa  Monica,
California 90401,  telecopier number: (310) 393-5749, with a copy via telecopier
to: Parker,  Chapin,  Flattau & Klimpl,  Attn:  Henry Rothman,  Esq., (212) 704-
6288, and (ii) if to the  Subscriber,  to the name,  address and telecopy number
set forth on the signature page hereto.

                           (b) Closing.  The  consummation  of the  transactions
contemplated  herein  shall take place at the offices of Grushko & Mittman,  277
Broadway,  Suite 801, New York,  New York 10007,  upon the  satisfaction  of all
conditions to Closing set forth in this Agreement. The closing date shall be the
date that  subscriber  funds  representing  the net amount due the Company  from
aggregate  subscriptions  of $2,500,000 are  transmitted by wire transfer to the
Company and the  Registration  Escrow is received by the Escrow Agent identified
in the Funds Escrow Agreement (the "Closing Date").

                           (c)  Entire  Agreement;  Assignment.  This  Agreement
represents the entire  agreement  between the parties hereto with respect to the
subject  matter  hereof and may be amended  only by a writing  executed  by both
parties.  No right or obligation of either party shall be assigned by that party
without prior notice to and the written consent of the other party.

                           (d)  Execution.  This  Agreement  may be  executed by
facsimile  transmission,  and in  counterparts,  each of which will be deemed an
original.

                           (e) Law  Governing  this  Agreement.  This  Agreement
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.  Any action brought
by either party against the other  concerning the  transactions  contemplated by
this  Agreement  shall be brought only in the state courts of New York or in the
federal courts located in the state of New York. Both parties agree to submit to
the  jurisdiction  of such courts and waive trial by jury. The prevailing  party
shall be entitled to recover from the other party its reasonable attorney's fees
and costs. In the event that any provision of this Agreement or 9/23/98

<PAGE>



any other agreement delivered in connection herewith is invalid or unenforceable
under any applicable statute or rule of law, then such provision shall be deemed
inoperative  to the extent that it may  conflict  therewith  and shall be deemed
modified to conform with such statute or rule of law. Any such  provision  which
may prove invalid or  unenforceable  under any law shall not affect the validity
or enforceability of any other provision of any agreement.

                           (f)  Cancellation.  Until a  Closing  actually  takes
place,  either or both the Company or Subscriber  may withdraw  without  penalty
from the transactions described herein.

                           (g)  Automatic  Termination.   This  Agreement  shall
automatically terminate without any further action of either party hereto if the
Closing shall not have occurred by the seventh (7th)  business day following the
date this Agreement is accepted by the Subscriber,  provided,  however, that any
such termination shall not terminate the liability of any party which is then in
breach of the Agreement.






                      [THIS SPACE INTENTIONALLY LEFT BLANK]
                                       

<PAGE>



                  Please   acknowledge   your   acceptance   of  the   foregoing
Subscription  Agreement  by  signing  and  returning  a copy to the  undersigned
whereupon it shall become a binding agreement between us.

                                        Very truly yours,

                                        THE RECOVERY NETWORK, INC.


                                        By:________________________________


                                        Dated: June ____, 1998


Purchase Price: $750,000.00

Issue Price (per share): $2.2875

Common Shares Purchased (aggregate): 327,869

Common Stock Purchase Warrants Obtained: 30,000

Aggregate Put Consideration: $900,000

Section 7.1(e) Shares: 285,656


ACCEPTED:

AUSTOST ANSTALT SCHAAN
7440 Fuerstentum
Lichenstein
Landstrasse 163
Fax No.: 011-431-534532895


By:____________________________


Dated as of June ____, 1998


<PAGE>



                  Please   acknowledge   your   acceptance   of  the   foregoing
Subscription  Agreement  by  signing  and  returning  a copy to the  undersigned
whereupon it shall become a binding agreement between us.

                                          Very truly yours,

                                          THE RECOVERY NETWORK, INC.


                                          By:________________________________


                                          Dated: June ____, 1998


Purchase Price: $750,000.00

Issue Price (per share): $2.2875

Common Shares Purchased (aggregate): 327,869

Common Stock Purchase Warrants Obtained: 30,000

Aggregate Put Consideration: $900,000

Section 7.1(e) Shares: 285,656


ACCEPTED:

BALMORE FUNDS S.A.
P.O. Box 4603
Zurich, Switzerland
Fax No.: 011-411-201-6262


By:____________________________


Dated as of June ____, 1998


<PAGE>



                  Please   acknowledge   your   acceptance   of  the   foregoing
Subscription  Agreement  by  signing  and  returning  a copy to the  undersigned
whereupon it shall become a binding agreement between us.

                                          Very truly yours,

                                          THE RECOVERY NETWORK, INC.


                                          By:________________________________


                                          Dated: June ____, 1998


Purchase Price: $500,000.00

Issue Price (per share): $2.2875

Common Shares Purchased (aggregate): 218,579

Common Stock Purchase Warrants Obtained: 20,000

Aggregate Put Consideration: $600,000

Section 7.1(e) Shares: 190,437


ACCEPTED:

ZAKENI LTD.
c/o Betuvo AG
Baarer Strasse
73 Postsach 2121
6302 ZUG, Switzerland
Fax No.: 416-638-5023


By:____________________________


Dated as of June ____, 1998


<PAGE>



                  Please   acknowledge   your   acceptance   of  the   foregoing
Subscription  Agreement  by  signing  and  returning  a copy to the  undersigned
whereupon it shall become a binding agreement between us.

                                            Very truly yours,

                                            THE RECOVERY NETWORK, INC.


                                            By:________________________________


                                            Dated: June ____, 1998


Purchase Price: $200,000.00

Issue Price (per share): $2.2875

Common Shares Purchased (aggregate): 87,432

Common Stock Purchase Warrants Obtained: 8,000

Aggregate Put Consideration: $240,000

Section 7.1(e) Shares: 76,175


ACCEPTED:

BL SQUARED FOUNDATION
274 Madison Avenue
New York, New York 10016
Fax No.: 212-770-3218


By:____________________________


Dated as of June ____, 1998


<PAGE>



                  Please   acknowledge   your   acceptance   of  the   foregoing
Subscription  Agreement  by  signing  and  returning  a copy to the  undersigned
whereupon it shall become a binding agreement between us.

                                             Very truly yours,

                                             THE RECOVERY NETWORK, INC.


                                             By:________________________________


                                             Dated: June ____, 1998


Purchase Price: $150,000.00

Issue Price (per share): $2.2875

Common Shares Purchased (aggregate): 65,574

Common Stock Purchase Warrants Obtained: 6,000

Aggregate Put Consideration: $180,000

Section 7.1(e) Shares: 57,131


ACCEPTED:

THE SARGON FUND, L.P.
20 Adele Road
Cedarhurst, New York 11516
Fax No.: 516-371-6999


By:____________________________


Dated as of June ____, 1998


<PAGE>



                  Please   acknowledge   your   acceptance   of  the   foregoing
Subscription  Agreement  by  signing  and  returning  a copy to the  undersigned
whereupon it shall become a binding agreement between us.

                                         Very truly yours,

                                         THE RECOVERY NETWORK, INC.


                                         By:________________________________


                                         Dated: June ____, 1998


Purchase Price: $100,000.00

Issue Price (per share): $2.2875

Common Shares Purchased (aggregate): 43,716

Common Stock Purchase Warrants Obtained: 4,000

Aggregate Put Consideration: $120,000

Section 7.1(e) Shares: 38,087


ACCEPTED:

MARTIN CHOPP
1129 East 22nd Street
Brooklyn, New York 11210
Fax No.: 718-854-3342


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


Dated as of June ____, 1998


<PAGE>


                  Please   acknowledge   your   acceptance   of  the   foregoing
Subscription  Agreement  by  signing  and  returning  a copy to the  undersigned
whereupon it shall become a binding agreement between us.

                                         Very truly yours,

                                         THE RECOVERY NETWORK, INC.


                                         By:________________________________


                                         Dated: June ____, 1998


Purchase Price: $50,000.00

Issue Price (per share): $2.2875

Common Shares Purchased (aggregate): 21,858

Common Stock Purchase Warrants Obtained: 2,000

Aggregate Put Consideration: $60,000

Section 7.1(e) Shares: 19,044


ACCEPTED:

TLG REALTY
c/o Melo
525 West 52nd Street
New York, New York 10019
Fax No.: 212-974-8315


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


Dated as of June ____, 1998