SERIES F CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT



         This Preferred  Stock Purchase  Agreement  ("Agreement")  is made as of
this 24th day of May, 1999 by and between  Sedona  Corporation,  a  Pennsylvania
corporation  (the  "Company")  and The Tang  Fund,  with an address at 600 Fifth
Avenue, 8th Floor New York, New York 10020 (the "Investor").

         THE PARTIES HEREBY AGREE AS FOLLOWS:

                  1_       Purchase and Sale of Convertible Preferred Stock.



                           1_1 Investment by the Investor.  Subject to the terms
         and  conditions  of this  Agreement,  at the  Closing  (as  hereinafter
         defined),  the  Company  will issue and sell to the  Investor,  and the
         Investor  will  purchase,  up  to  an  aggregate  of  500  shares  (the
         "Securities") of the Class A, Series F Convertible Preferred Stock, par
         value $2.00 per share, of the Company (the "Series F Stock") having the
         terms set forth in the Articles of  Amendment of the Company,  the form
         of such  Articles  of  Amendment  attached  hereto  as  Exhibit  A (the
         "Articles of Amendment"),  at a purchase price per share of $1,000, for
         an aggregate purchase price of $500,000 (the "Investment Amount").  For
         purposes of this Agreement, the "Closing Price" shall be $1.41.



                           1_2 Closing.  The purchase and sale of the Securities
         (the  "Closing")  shall take place at the offices of Company on May 24,
         1999 (the "Closing Date").



                           1_3  Use  of  Proceeds.  The  Company  will  use  the
         proceeds  from  the  sale of the  Series F Stock  for  working  capital
         purposes.



                  2_ Representations and Warranties of the Company.  The Company
         hereby  represents  and  warrants to, and agrees  with,  the  Investor,
         except as set forth on the disclosure  schedules attached hereto, which
         exceptions shall be deemed to be  representations  and warranties as if
         made hereunder, as follows:



                           2_1  Organization,  Good Standing and  Qualification.
         The Company is a corporation  duly organized,  validly  existing and in
         good standing under the laws of the Commonwealth of  Pennsylvania.  The
         Company has all requisite  power and authority to carry on its business
         as now conducted  and as proposed to be conducted.  The Company has all
         requisite  power and authority to enter into and perform this Agreement
         and the  transactions  contemplated  hereby  and is duly  qualified  to
         transact business and is in good standing in each jurisdiction in which
         the failure so to qualify could have a material  adverse  effect on its
         business,  properties,   operations,   earnings,  assets,  liabilities,
         condition   (financial  or   otherwise)  or  prospects   (collectively,
         "Condition").



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                           2_2      Capitalization.



                                    _a_     After   giving   effect  to  the
         transactions   contemplated   by  the Agreement,  and immediately after
         the Closing, the capital  stock of the Company,  as  authorized  by the
         Articles  of  Incorporation and the Articles of Amendment, will consist
         of: (i) 50,000,000 shares of Common Stock,  (A)  21,545,346  shares  of
         which are issued and outstanding,  (B)  3,000,000  shares  of which are
         reserved  for issuance to key  employees,  non-employee  directors  and
         consultants  of  the  Company  under   the  Company's  1992   Long-Term
         Incentive Plan, as amended, (C) 500,000 shares of  which  are  reserved
         for  conversion  of the  outstanding  Class A Preferred  Stock,  Series
         A,  par  value  $2.00  per  share (the  "Series  A  Preferred  Stock"),
         (D) 1,648,915  shares  of which remain  reserved for conversion  of the
         outstanding  Series E  Preferred  Stock  ("Series E Preferred  Stock"),
         (E)  2,754,322  shares of which are  reserved  for exercise of warrants
         issued  in   connection   with   the  Series  E  Preferred  Stock,  (F)
         approximately   939,130    shares   of   which   are    reserved    for
         conversion  of the Class A,  Series B Stock  (the  "Series B  Preferred
         Stock"), (G) 3,000,016 shares of which are reserved for the exercise of
         outstanding  warrants  issued in connection  with the Class A Preferred
         Stock, Series D (the "Series D Preferred Stock"),  (H) 3,923,043 shares
         of which are reserved for the exercise of other  outstanding  warrants,
         including  warrants  issued in  connection  with the Class A  Preferred
         Stock,  Series C (the "Series C Preferred  Stock"),  and (I)  1,000,000
         shares of which are reserved for conversion of the Class F Stock;  (ii)
         2,000,000 shares of Class B Preferred  Stock,  none of which are issued
         and outstanding or available for reissuance; and (iii) 1,000,000 shares
         of Class A  Preferred  Stock,  (A)  500,000  shares of which  have been
         designated  Series A  Preferred  Stock,  all of which  are  issued  and
         outstanding,  (B) 5,000 shares of which have been  designated  Series B
         Preferred Stock, 1,000 shares of which are issued and outstanding,  (C)
         5,200 shares of which have been  designated  Series E Preferred  Stock,
         2,313 shares of which are issued and outstanding, (D) 125,000 shares of
         which have been designated as Series C Preferred  Stock,  none of which
         are issued and  outstanding  or  available  for  reissuance,  (E) 3,300
         shares of which have been designated as Series D Preferred Stock,  none
         of which are issued and  outstanding or available for  reissuance,  and
         (F) 1,000 shares of which have been designated as Series F Stock, 1,000
         of which  are  issued  and  outstanding.  The  rights,  privileges  and
         preferences of the Class B Preferred Stock, the Class A Preferred Stock
         (including,  without  limitation,  the  Series F Stock)  and the Common
         Stock are as stated in the Articles of  Incorporation  and the Articles
         of Amendment.





<PAGE>


                                    _b_     Except  for  Common  Stock  reserved
         for  issuance  as described in subsection (a) above, as of the Closing,
         the Company will not  (i)  have  outstanding any capital stock or other
         securities  convertible  into or  exchangeable  for any  shares  of its
         capital  stock  and, except  as otherwise contained in  the Articles of
         Incorporation,  the Articles  of Amendment or  pursuant to the terms of
         any of the Purchase Documents, as defined  in  section  2.3  below,  no
         person   will  have  any  righ   to   subscribe  for  or  to   purchase
         (including  conversion  or  preemptive rights), or any options for  the
         purchase of, or any  agreements providing for  the issuance (contingent
         or  otherwise)  of,  any  calls,  commitments  or  other  claims of any
         character  relating to, any capital stock or  any stock  or  securities
         convertible  into or exchangeable for any capital stock of the Company;
         (ii)   have any capital stock,   equity interests  or  other securities
         reserved for issuance for any purpose;  or  (iii)  be  subject  to  any
         obligation  (contingent  or  otherwise)  to  repurchase   or  otherwise
         acquire or retire any shares of its  capital stock or  any  convertible
         securities,  rights or options of the type described  in  the preceding
         clause  (i).   All  of  the  issued  and  outstanding shares  of Common
         Stock, Class B Preferred Stock and Class A Preferred Stock  (including,
         without  limitation,  the  Series  B  Stock) have been duly and validly
         issued and  are fully  paid and  nonassessable and all of the shares of
         Conversion Stock and  the Warrant Shares,   when issued as contemplated
         hereby, will be validly issued,  fully paid and nonassessable.   To the
         best  knowledge  of  the  Company,  there  are  no agreements among the
         Company's  stockholders with respect to the voting  or  transfer of the
         Company's  capital stock,  other than the agreements regarding transfer
         contained  herein.   Schedule  I  attached  hereto includes  a complete
         and  correct  list  of the  name  of each of the Company's current  and
         former officers, directors,  employees or Persons that beneficially own
         in  excess  of 5.0% of the  outstanding  equity interest of the Company
         (each,  a "Principal  Owner") and the number of shares of Common  Stock
         owned by each such  Principal  Owner as of the Closing Date.





<PAGE>


                           2_3  Authority;  Execution  and  Delivery;  Requisite
         Consents;  Nonviolation.  The Company  has,  and as of the Closing will
         have, all requisite power and authority to execute, deliver and perform
         this Agreement and each other document or instrument executed by it, or
         any of its officers,  in  connection  herewith or therewith or pursuant
         hereto or thereto (this  Agreement,  together with all of the foregoing
         documents  and  instruments,  are  sometimes  collectively  referred to
         herein as the "Purchase Documents"), and to consummate the transactions
         contemplated   hereby  and  thereby.   The   execution,   delivery  and
         performance of this Agreement and the other Purchase  Documents and the
         consummation of the transactions  contemplated  hereby and thereby have
         been duly and validly authorized by all necessary action on the part of
         the Company.  This Agreement and each of the other  Purchase  Documents
         that  has been  executed  as of the date  hereof  are,  and each of the
         Purchase  Documents  will  be as of  the  Closing,  duly  executed  and
         delivered by the Company and the legal, valid and binding obligation of
         the Company,  enforceable  against the Company in  accordance  with its
         terms,  except  as  the  enforceability   thereof  may  be  limited  by
         bankruptcy,   insolvency   or  other   similar   laws   affecting   the
         enforceability of creditors' rights in general or by general principles
         of equity.  The execution,  delivery and  performance of this Agreement
         and the other Purchase  Documents,  the  consummation by the Company of
         the transactions  contemplated hereby and thereby  (including,  without
         limitation,  the  offer,  sale  and  delivery  by  the  Company  of the
         Securities)  will not:  (a) except for the  filing of the  Articles  of
         Amendment,  require the consent,  license,  permit,  waiver,  approval,
         authorization   or  other   action  of,  by  or  with  respect  to,  or
         registration,  declaration  or filing with,  any court or  governmental
         authority,   department,   commission,   board,   bureau,   agency   or
         instrumentality,  domestic or foreign ("Governmental Authority") or any
         other individual, partnership, corporation, unincorporated organization
         or  association,  limited  liability  company,  trust or  other  entity
         (collectively,  a "Person"); (b) violate or conflict with any provision
         of the  Articles of  Incorporation,  the  Articles of  Amendment or the
         By-laws of the  Company,  a complete and correct copy of which has been
         provided to counsel to the Investor;  or (c) constitute a default (with
         or without notice or lapse of time or both) under,  violate or conflict
         with,  or  give  rise  to  a  right  of  termination,  cancellation  or
         acceleration  or to a loss  of a  material  benefit  under  any Law (as
         defined in  Section  2.6  below),  Permit  (as  defined in Section  2.6
         below),   Order  (as  defined  in  Section  2.5  below),  or  contract,
         agreement, arrangement or understanding,  written or oral, to which the
         Company is or  hereafter  may be a party or by which the Company or its
         properties are or hereafter may be bound.



                           2_4  Subsidiaries.  Except as set  forth on  Schedule
         2.4,  the Company has no  subsidiaries  and does not,  and prior to the
         Closing  will  not,  own  or  control,  directly  or  indirectly,   any
         partnership   interests,   stock  or  other  equity  interests  in  any
         partnership,  corporation or other entity or any voting rights or right
         to control the policies and direction of any  partnership,  corporation
         or other entity.



                           2_5 Litigation. There is no action, suit, proceeding,
         investigation   or   governmental   approval   process   (collectively,
         "Actions") pending or, to the best knowledge of the Company, threatened
         against it, or affecting any of its  properties  or assets  (including,
         without  limitation,  any of its Permits) which  individually or in the
         aggregate could have a material adverse effect on its Condition, nor is
         there any  basis  for any such  Action.  To the best  knowledge  of the
         Company,  there is no Action against any of its directors,  officers or
         employees in  connection  with its business  which,  in the event of an
         adverse judgment against any such Person, could have a material adverse
         effect on the Condition of the Company,  nor is there any basis for any
         such Action. The foregoing  includes,  without  limitation,  any Action
         pending or, to the Company's best  knowledge,  threatened (or any basis
         therefor  known to the Company)  involving the prior  employment of any
         employees of the Company,  their use in connection with the business of
         the Company of any information or techniques  allegedly  proprietary to
         any  of  their  former  employers,   or  their  obligations  under  any
         agreements  with prior  employers.  Neither  the Company nor any of its
         assets or properties,  nor, in connection with its business, any of its
         directors,  officers or employees,  is subject to any order,  judgment,
         writ, injunction, decree, ruling or decision (collectively, an "Order")
         of any Governmental Authority which is material to the Condition of the
         Company.  There is no Action by the Company  currently pending or which
         the Company intends to initiate which is material to its Condition.





<PAGE>


                           2_6  Compliance  with  Laws;  Permits.  Assuming  the
         accuracy  of the  representations  made  by the  Investor  pursuant  to
         Section 3 hereof,  the offer and sale of the Securities to the Investor
         will be in compliance with all applicable  federal and state securities
         laws.  The Company has not  violated or failed to comply  with,  in any
         material respect,  any statute,  law,  ordinance,  rule,  regulation or
         policy of any Governmental Authority (collectively, "Laws") to which it
         or any of its  properties  or assets is  subject.  The  Company has all
         permits, licenses, orders,  certificates,  authorizations and approvals
         of any Governmental  Authority  (collectively,  the "Permits") that are
         material to the conduct of its business as presently  conducted  and as
         proposed to be  conducted;  all such Permits are, and as of the Closing
         will be, in full force and effect;  no violations or notices of failure
         to comply have been issued or recorded in respect of any such  Permits;
         and the Company has no  knowledge of any reason why such Permits may be
         revoked or  suspended.  All  applications,  reports,  notices and other
         documents  required  to be filed by the Company  with all  Governmental
         Authorities  have been timely filed and are complete and correct in all
         material respects as filed or as amended prior to the date hereof. With
         respect  to any  required  Permits,  applications  for which are either
         pending or contemplated to be made pursuant to the business strategy of
         the Company, the Company knows of no reason why such Permits should not
         be approved  and  granted by the  appropriate  Governmental  Authority.
         Neither the Company nor any of its  officers,  employees  or agents has
         made any illegal or improper  payments  to, or provided  any illegal or
         improper  inducement for, any governmental  official or other Person in
         an  attempt to  influence  any such  Person to take or to refrain  from
         taking any action relating to the Company.



                           2_7  Absence  of Certain  Changes  or  Events.  Since
         December  31,  1998,  there has been no change in the  Condition of the
         Company,  except  for  changes  in  the  ordinary  course  of  business
         consistent  with past practice  which have not been, in the  aggregate,
         materially adverse to the Company.



                           2_8  Title  to  Assets.  The  Company  has  good  and
         marketable  title to all of its owned assets and  properties,  free and
         clear of any liens, pledges, security interests,  claims,  encumbrances
         or other restrictions of any kind (collectively, "Liens"). With respect
         to any assets or  properties  it leases,  the Company holds a valid and
         subsisting leasehold interest therein,  free and clear of any Liens, is
         in  compliance,  in  all  material  respects,  with  the  terms  of the
         applicable lease, and enjoys peaceful and undisturbed  possession under
         such lease.  All of the assets and  properties  of the Company that are
         material  to the  conduct of  business  as  presently  conducted  or as
         proposed to be  conducted  by it are in good  operating  condition  and
         repair, subject to ordinary wear and tear. The inventory of the Company
         is in good and marketable condition,  does not and will not include any
         material quantity of items which are obsolete,  damaged or slow moving,
         and is salable  (or may be leased) in the normal  course of business as
         currently  conducted  by it, at  current  applicable  prices and within
         normal inventory "turn" experience.



                           2_9  Contracts.   True  and  correct  copies  of  all
         contracts,   agreements,   notes,  instruments,   franchises,   leases,
         licenses, commitments,  arrangements or understanding,  written or oral
         (collectively,  "Contracts") which are material to the Condition of the
         Company have been made available to the Investor.  All of the Contracts
         are in full force and effect and  constitute  legal,  valid and binding
         obligations  of the Company and, to the best  knowledge of the Company,
         the other parties  thereto;  the Company and, to the best  knowledge of
         the Company,  each other party  thereto,  has performed in all material
         respects  all  obligations  required  to be  performed  by it under the
         Contracts,  and no  material  violation  or  default  exists in respect
         thereof,  nor any  event  that with  notice or lapse of time,  or both,
         would constitute a default  thereof,  on the part of the Company or, to
         the best knowledge of the Company, any other party thereto; none of the
         Contracts  is  currently   being   renegotiated;   and  the   validity,
         effectiveness  and continuation of all Contracts will not be materially
         adversely affected by the transactions contemplated by this Agreement.





<PAGE>


                           2_10 Intellectual Property. (a) (i) The Company owns,
         or has the  right  to use,  all  United  States  and  foreign  patents,
         trademarks,  service marks, trade names, brand names, computer software
         and  programs,  franchises,  technology,  know-how and  processes,  and
         registered  copyrights,  and any  applications for any of the foregoing
         (collectively,  the  "Intellectual  Property") of any kind in which the
         Company has an interest  or which is  otherwise  used in, or relates to
         its business.  Schedule II hereto contains a true, correct and complete
         list of all registered trademarks and service marks, all reserved trade
         names, all registered  copyrights and all filed patent applications and
         issued patents that are used in the Company's business or are otherwise
         necessary for the conduct of its business as  heretofore  conducted and
         all  licenses  or  agreements  that in any way affect the rights of the
         Company  to any of  its  Intellectual  Property  or  any  trade  secret
         material (the "Intellectual Property Licenses").



                                    (ii)    Subject to the limitations set forth
in the  Intellectual  Property Licenses,  the  Company  has all right, title and
interest in all of the owned Intellectual Property, free and clear of all Liens.
The  Company owns  or  has the  exclusive  or  non-exclusive  right  to  use all
Intellectual  Property  or trade secrets  necessary  to  conduct its business as
now  being  conducted  or  as  proposed  to be  conducted.  The Company  owns or
possesses  sufficient licenses or other rights  to use all Intellectual Property
covered  by  its  patents  or  patent  applications  necessary  to  conduct  its
business as now being  conducted and as proposed to be conducted by the Company.

                                    (iii) The Company has not  disclosed,  other
than in the ordinary course of business and  consistent  with past  practice and
pursuant  to the  Intellectual Property  Licenses,  any proprietary  information
relating to the  Intellectual  Property or the  Intellectual  Property  Licenses
to any person  other than the Investor.  The Company has at all times maintained
reasonable  procedures  to protect and have  enforced all of its trade  secrets.
The Company has disclosed trade  secrets  to other  Persons  solely as  required
for the  conduct  of its business and solely under nondisclosure agreements that
are  enforceable  by  the Company.   Other  than pursuant  to  the  Intellectual
Property Licenses, the Company is not under any  contractual or other obligation
to disclose any  proprietary information relating to the Intellectual  Property,
any trade secret material to the Company or the Intellectual Property  Licenses,
nor,  to  the  best  knowledge  of  the  Company,   is  any  other  party to the
Intellectual Property Licenses under any such obligation to disclose proprietary
information included in or relating to Intellectual  Property,  any trade secret
material  to  the  Company or  the Intellectual Property Licenses to any Person,
and no event has taken  place,  including  the execution  and  delivery  of this
Agreement  and  the  transactions contemplated  hereby or any related  change in
the business activities of the Company, that would give rise to such obligation.

                                    (iv) The  consummation  of the  transactions
contemplated hereby will not alter,   adversely  affect or impair the  rights of
the  Company  to any of the Intellectual  Property,  any trade  secret  material
to it, or under any of the Intellectual Property Licenses.



<PAGE>


                           (b)      (i)     No  claim  with  respect  to  the
Intellectual  Property,  any trade  secret  material  to  the  Company,  or  any
Intellectual  Property  License  which would adversely affect the ability of the
Company to conduct its business as  presently conducted  and  as proposed  to be
conducted is  currently  pending or,  to the  best  knowledge  of  the  Company,
has been  asserted,  or overtly  threatened  by any Person, nor does the Company
know of any  grounds  for  any claim  against the Company,   (A)  to the  effect
that  any  operation  or  activity  of   the  Company  presently   occurring  or
contemplated,  including,  inter  alia,  the manufacture,  use  or sale  of  any
product,  device,  instrument,  or other  material  made  or  used  according to
the patents  or patent  applications  included in  the  Intellectual Property or
Intellectual  Property Licenses, infringes or  misappropriates any United States
or  foreign  copyright,  patent,  trademark,   service  mark  or  trade  secret;
(B)  to  the  effect  that  any  other  Person  infringes  on  the  Intellectual
Property or  misappropriates  any trade secret or know-how or other  proprietary
rights  material to the Company;  (C)  challenging  the  ownership,  validity or
effectiveness  of any of the  Intellectual  Property or trade secret material of
the  Company;  or (D)  challenging  the license of the Company or other  legally
enforceable right under, any Intellectual  Property or the Intellectual Property
Licenses.

                                    (ii)    The  Company  is  not  aware  of any
presently  existing  United States or foreign patents or any patent applications
which  if  issued  as patents would be infringed by any activity contemplated by
the Company.

                           (c)      (i)     The   United   States   and  foreign
patents and patent  applications  owned  by  the Company  listed  in Schedule II
hereto (the "Patents and  Applications")  as part of the  Intellectual  Property
have been  properly  prepared  and  filed  on  behalf  of  the  Company as named
therein  and are being  diligently  pursued  by  the  Company.   The  inventions
described  in the Patents  and  Applications are assigned  or  licensed  to  the
Company  and  no  other  entity or  individual  has any right or claim in any of
the inventions, Patents and  Applications or any patents to be issued therefrom,
except as set forth in the  Intellectual Property  Licenses.  To  the  Company's
best   knowledge,   there   are  no  defects   in  any   of   the   Patents  and
Applications  that would cause any of them to be held invalid or  unenforceable.
All  relevant  prior art of which  the  Company  is aware has been  filed in the
Patents and Applications.

                                    (ii)    The  Company has  delivered  to  the
Investor  all  information  in  its  possession  or  of  which  it has knowledge
concerning the Patents and Applications and has no knowledge of any objection or
proceeding, pending or threatened, that would affect the validity of  any patent
issued pursuant thereto.  The  Company  has furnished  to the Investor all prior
art, of which it presently  has  knowledge, that may be material to the validity
or  enforceability  of  the  patent  claims being  prosecuted in the Patents and
Applications.

                                    (iii)   Except   in   connection   with  the
prosecution of the patent applications listed in Schedule  II hereto,  there are
no pending  judicial  or  governmental proceedings,  including  but  not limited
to   interferences  and  oppositions,  relating   to  any  of  the  Patents  and
Applications  or any  other  proprietary information  to which the  Company is a
party or by which any  property (such term "property"  specifically   to include
rights  pursuant  to licenses or options or other  rights to  acquire  licenses)
of  the  Company  is  subject,   and  no  such  proceedings  are  threatened  or
contemplated by Governmental  Authorities or other Persons.

                           (d)      Nothing  has  come  to the  attention of the
Company  that  has caused it to believe that this Section  2.10,  as of the date
hereof  and as of the Closing,   contains any  untrue  statement  of a  material
fact  or  omits  to  state  a  material  fact required  to b e stated  herein or
necessary  to make the  statements  herein not misleading.

                           2_11  Insurance.  The  Company  has in full force and
         effect all insurance policies as are sufficient for compliance with all
         requirements of Law and applicable agreements.



<PAGE>




                           2_12 Labor Union Activities;  Employee Relations.  No
         employee of the Company is represented by any labor union or covered by
         any collective bargaining agreement;  nor, to the best knowledge of the
         Company,  has any labor union sought to represent  any of its employees
         of the Company. There is no strike or other labor dispute involving the
         Company pending,  or to the best knowledge of the Company,  threatened.
         To the best  knowledge  of the  Company,  no  officer  or key  employee
         intends to terminate his  employment  with it. To the best knowledge of
         the Company, no officer or key employee of it is a party to or bound by
         any  Contract,  or  subject  to any  restrictions  (including,  without
         limitation, any non-competition restriction),  which would restrict the
         right of such person to participate in the affairs of the Company.



                           2_13 ERISA. The Company does not maintain (nor has it
         ever  maintained) nor does it have (nor has it ever had) any obligation
         under (including,  without limitation, any obligation to contribute to)
         an employee  benefit  plan as described in Section 3(3) of the Employee
         Retirement Income Security Act of 1974, as amended ("ERISA").



                           2_14 Taxes. All federal,  state, city, county,  local
         and foreign income,  franchise,  sales, use and value added tax returns
         and reports, and all other material tax returns and reports required to
         be  filed  by  the  Company  in  those  or in  any  other  jurisdiction
         (collectively,  "Returns") have been timely filed. All such Returns are
         true,  correct  and  complete  in all  material  respects.  All  taxes,
         assessments,  fees, interest,  penalties and other charges with respect
         thereto  (collectively,  "Taxes")  due or  claimed  to be due  from the
         Company  have been paid  except to the extent  reserved  against on the
         Company's financial statements. No income tax return of the Company has
         been audited by the applicable Governmental Authority, and there are in
         effect no waivers of the applicable statute of limitations for Taxes in
         any jurisdiction for the Company for any period.



                           2_15 Environmental Matters. The business,  assets and
         properties of the Company are and have been operated and  maintained in
         compliance with all applicable  federal,  state, city, county and local
         environmental  protection  laws  and  regulations  (collectively,   the
         "Environmental Laws"). No event has occurred which, with or without the
         passage  of time or the  giving of notice,  or both,  would  constitute
         non-compliance  by the Company  with, or a violation by the Company of,
         the  Environmental  Laws.  The Company has not caused or  permitted  to
         exist, as a result of an intentional or unintentional  act or omission,
         a  disposal,  discharge  or  release  of solid  wastes,  pollutants  or
         hazardous  substances,  on or  from  any  site  which  currently  is or
         formerly was owned,  leased,  occupied or used by it, except where such
         disposal, discharge or release was in compliance with the Environmental
         Laws.



                           2_16 Books and Records. The books of account, ledgers
         and records of the Company  accurately  and  completely  reflect in all
         material respects all information relating to its business, the nature,
         acquisition,  maintenance,  location and collection of its assets,  and
         the  nature  of all  transactions  giving  rise to its  obligations  or
         accounts  receivable.  The minute books of the Company  fully set forth
         all action taken by its Board of Directors,  stockholders  and, if any,
         executive committee (or other committee thereof).



<PAGE>




                           2_17  Transactions  with  Affiliates.  Except  as set
         forth on Schedule  2.17, the Company has not had any direct or indirect
         dealings with any Principal Owner or with any of such Principal Owner's
         Affiliates,  associates or relatives.  The Company has no obligation to
         or claim against any Principal Owner, or any of such Principal  Owner's
         Affiliates,  associates  or  relatives,  and no  such  Person  has  any
         obligation to or claim against the Company.  All products,  services or
         benefits provided to the Company by any such Person, or provided by the
         Company to any such Person are  provided at a charge  equal to the fair
         market  value of such  products,  services or  benefits.  No  Principal
         Owner,  nor any of such  Principal  Owner's  Affiliates,  associates or
         relatives,  has any  direct  or  indirect  interest  of any kind in any
         business or entity which is competitive  with the Company.  "Affiliate"
         of a specified Person shall mean a person that directly,  or indirectly
         through one or more intermediaries, controls or is controlled by, or is
         under common control with, the Person specified.



                           2_18  Registration  Rights.  Except  as set  forth on
         Schedule  2.18,  no Person has,  and as of the Closing no Person  shall
         have, demand, "piggy-back" or other rights to cause the Company to file
         any registration statement under the Securities Act of 1933, as amended
         (the  "Securities  Act"),  relating  to  any of  its  securities  or to
         participate in any such registration statement.



                           2_19 No  Brokers or  Finders.  Except as set forth on
         Schedule 2.19, neither the Company nor any of its respective Affiliates
         has  entered  or will enter into any  agreement  pursuant  to which the
         Company or the Investor will be liable, as a result of the transactions
         contemplated  by this Agreement or any of the Purchase  Documents,  for
         any claim of any person for any commission,  fee or other  compensation
         as finder or broker and the Company  agrees to  indemnify  the Investor
         for any liability resulting from any such agreement.



                           2_20  Investment  Company  Act. The Company is not an
         "investment   company"  nor  is  the  Company  directly  or  indirectly
         controlled by or acting on behalf of any Person which is an "Investment
         Company"  within the meaning of the Investment  Company Act of 1940, as
         amended.



                           2_21  Disclosure.  In connection with the purchase of
         the  Securities by the Investors as  contemplated  hereby,  the Company
         has, to its knowledge, disclosed to the Investor all material facts and
         information  concerning the Company,  its Condition and the Securities,
         and has not, to its knowledge,  made any untrue statement of a material
         fact or omitted to state any material  fact  necessary in order to make
         the  statements  contained  herein  or in  any of  the  other  Purchase
         Documents not misleading.





<PAGE>


                           2_22 Year 2000  Compliance.  The Company has reviewed
         its products, business and operations which could be adversely affected
         by the risk that computer applications  developed,  marketed,  sold and
         delivered  or  used by the  Company  may be  unable  to  recognize  and
         properly perform date-sensitive  functions involving dates prior to and
         after  December  31,  1999 (the "Year  2000  Problem").  The  Company's
         products and services  provided or delivered to its  customers  and the
         Company's  internal  information  and business  systems will be able to
         perform  properly  date-sensitive  functions  for all dates  before and
         after  January 1, 2000.  In addition,  the Company has  surveyed  those
         vendors, suppliers and other third parties (collectively,  the "Outside
         Parties")  with which the Company does  business  and whose  failure to
         adequately  address the Year 2000 Problem could have a material adverse
         effect on the Condition of the Company.  Based upon the  aforementioned
         internal  review and  surveys  of the  Outside  Parties,  the Year 2000
         Problem has not resulted in, and is not reasonably  expected to have, a
         material adverse effect on the Condition of the Company.



                           2_23 SEC Documents.  The Company has filed,  pursuant
         to the  Securities  Act and the  Securities  Exchange  Act of 1934,  as
         amended (the  "Exchange  Act"),  all SEC Documents  (as defined  below)
         required to be filed with respect to the business and operations of the
         Company  under each of the  Securities  Act and  Exchange  Act, and the
         respective  rules  and  regulations  thereunder,  and  all of  the  SEC
         Documents  complied  in  all  material  respects  with  all  applicable
         requirements of the Securities Act or the Exchange Act, as the case may
         be, and the appropriate act and the rules and regulations thereunder in
         effect on the date each such report was filed. At the respective  dates
         they  were  filed,  none  of the SEC  Documents  contained  any  untrue
         statement  of a material  fact or omitted  to state any  material  fact
         required  to be stated  therein  or  necessary  to make the  statements
         therein,  in light of the circumstances under which they were made, not
         misleading.  The  consolidated  financial  statements  of  the  Company
         included in the SEC  Documents  complied as to the form in all material
         respects with the applicable accounting  requirements and the published
         rules and  regulations of the Securities and Exchange  Commission  with
         respect  thereto,  have been  prepared  in  accordance  with  generally
         accepted accounting principles ("GAAP") consistently applied throughout
         the period involved (except as may be indicated therein or in the notes
         thereto)  and  fairly  present  the  consolidated  financial  position,
         results of operations  and cash flows of the Company as of the dates or
         for  the  periods  indicated  therein,  subject,  in  the  case  of the
         unaudited statements, to normal year-end adjustments and the absence of
         certain footnote disclosures. "SEC Documents" means all material forms,
         statements,  reports and documents (including all exhibits,  amendments
         and  supplements  thereto)  required  to be filed  with  respect to the
         business and operations of the Company under each of the Securities Act
         and  the  Exchange  Act,  and  the  respective  rules  and  regulations
         thereunder.



                  3  Representations  and  Warranties  of  the  Investor.   The
         Investor  hereby  represents  and  warrants  to, and agrees  with,  the
         Company as follows:



                           3_1 The  Investor  is, and as of the Closing will be,
         duly organized, validly existing and in good standing under the laws of
         its jurisdiction of organization.





<PAGE>


                           3_2  Authorization.  The Investor  has, and as of the
         Closing  will have,  all  requisite  power and  authority  to  execute,
         deliver and perform this Agreement and to consummate  the  transactions
         contemplated  hereby.  The execution,  delivery and performance of this
         Agreement,  and  the  consummation  of  the  transactions  contemplated
         hereby,  have been duly and validly  authorized by all necessary action
         on the part of the Investor.  This Agreement has been duly executed and
         delivered by the Investor and constitutes its legal,  valid and binding
         obligation,  enforceable  against the Investor in  accordance  with its
         terms,  except  as  the  enforceability   thereof  may  be  limited  by
         bankruptcy,   insolvency   or  other   similar   laws   affecting   the
         enforceability of creditors' rights in general or by general principles
         of equity.



                           3_3 No Legal Bar;  Conflicts.  Neither the  execution
         and delivery of this Agreement, nor the consummation by the Investor of
         the  transactions  contemplated  hereby,  violates  any  law,  statute,
         ordinance,  regulation,  order,  judgment  or  decree  of any  court or
         governmental  agency  applicable  to  the  Investor,  or  violates,  or
         conflicts with, any contract, commitment,  agreement,  understanding or
         arrangement  of any kind to which the  Investor  is a party or by which
         the Investor is bound.



                           3_4 No  Litigation.  No  action,  suit or  proceeding
         against  the  Investor  relating  to  the  consummation  of  any of the
         transactions contemplated by this Agreement nor any governmental action
         against the Investor  seeking to delay or enjoin any such  transactions
         is pending or, to the Investor's knowledge, threatened.



                           3_5  Investment   Intent.  The  Investor  (i)  is  an
         accredited  investor  within  the  meaning  of Rule  501(a)  under  the
         Securities Act, (ii) is aware of the limits on resale imposed by virtue
         of the nature of the transactions contemplated by this Agreement and is
         aware that the  certificates  representing  the  Investor's  respective
         ownership of Series F Stock will bear related  restrictive  legends and
         (iii) except as otherwise set forth herein,  is acquiring the shares of
         the Company hereunder without  registration under the Securities Act in
         reliance on the exemption from  registration  contained in Section 4(2)
         of the Securities Act, for investment for its own account, and not with
         a view  toward,  or for  sale  in  connection  with,  any  distribution
         thereof, nor with any present intention of distributing or selling such
         shares.  The Investor has been given the  opportunity  to ask questions
         of, and receive answers from, the officers of the Company regarding the
         Company,  its current and proposed business operations and the Series F
         Stock,  and the  officers of the  Company  have made  available  to the
         Investor all documents and information  that the Investor has requested
         relating  to an  investment  in the  Company.  The  Investor  has  been
         represented by competent  legal counsel in connection with its purchase
         of the Series F Stock and acknowledges that the Company has relied upon
         the  Investor's  representations  in this  Section  3 in  offering  and
         selling Series F Stock to the Investor.



                           3_6 No Brokers or Finders.  Neither the  Investor nor
         any of its  respective  Affiliates  has  entered or will enter into any
         agreement pursuant to which the Investor or the Company will be liable,
         as a result of the  transactions  contemplated by this Agreement or any
         of the  Purchase  Documents,  for  any  claim  of any  person  for  any
         commission,  fee or other  compensation  as finder  or  broker  and the
         Investor  agrees to indemnify the Company for any  liability  resulting
         from any such agreement.





<PAGE>


                           3_7  Economic  Risk;   Restricted   Securities.   The
         Investor  recognizes  that the investment in the Securities  involves a
         number of significant risks. The foregoing,  however, does not limit or
         modify the representations, warranties and agreements of the Company in
         Section  2 of this  Agreement  or the  right  of the  Investor  to rely
         thereon.  The  Investor  is able  to  bear  the  economic  risks  of an
         investment in the Securities  for an indefinite  period of time, has no
         need for liquidity in such  investment  and, at the present  time,  can
         afford a complete loss of such investment.



                           3_8 Hedging Activities. The Investor has no intention
         to  engage  in,  or  has  any  agreement  to  engage  in,  any  hedging
         transactions (including,  but not limited to, short sales, put and call
         options,  cashless  collar  transactions  or other forms of  derivative
         security transactions) with respect to the Common Stock.



                  4 Conditions of the Investor's  Obligations  at Closing.  The
         obligation  of the Investor to purchase the  Securities to be purchased
         by it at the Closing is subject to the  fulfillment  to the  Investor's
         satisfaction,  prior  to or at the  Closing,  of each of the  following
         conditions:



                           4_1    Representations     and    Warranties.     The
         representations  and  warranties  of  the  Company  contained  in  this
         Agreement and the other Purchase Documents shall be true and correct in
         all  material  respects on and as of the date of the Closing as if made
         on and as of such date.



                           4_2 Filing of Articles of Amendment.  The Articles of
         Amendment  shall  have been  adopted by the Board of  Directors  of the
         Company and filed with the  Secretary of State of the  Commonwealth  of
         Pennsylvania.



                           4_3 Performance. The Company shall have performed and
         complied with all agreements and conditions  required by this Agreement
         and the other Purchase Documents to be performed or complied with by it
         prior to or at the Closing.



                           4_4 Stock  Certificates.  Etc.  At the  Closing,  the
         Company shall have tendered to the Investor a certificate  representing
         the  Investor's  shares  of Series F Stock,  all in form and  substance
         satisfactory  to the Investor and sufficient to transfer to and vest in
         the Investor good and valid title to the Securities,  free and clear of
         any Lien.



                           4_5 Conduct of Business.  The Company  shall carry on
         its business  diligently  and shall not make or  institute  any unusual
         methods of management,  accounting or operation, except as agreed to in
         writing by the  Investor.  All of the property of the Company  shall be
         used,  operated,  repaired and maintained in a normal  business  manner
         consistent with past practice



                           4_6 Compliance  With Laws. The Company will comply in
         all  material   respects  with  all  laws  and  regulations  which  are
         applicable  to it, its ownership of its assets or to the conduct of its
         business and will perform and comply in all material  respects with all
         contracts, commitments and obligations by which it is bound.



                           4_7      No  Material  Adverse  Change.  There  shall
         not  have  occurred  any  material adverse change in  the Condition  of
         the Company.



<PAGE>




                           4_8  Consents.  The Company  shall have  obtained all
         consents,  approvals or waivers from Governmental Authorities and third
         Persons  necessary for the execution,  delivery and performance of this
         Agreement,  the other Purchase Documents and the Articles of Amendment,
         and the  transactions  contemplated  hereby and  thereby,  all  without
         material cost or other  adverse  consequences  to the Company.  Without
         limiting the  generality of the foregoing,  if applicable,  each of the
         Company's existing  stockholders shall have waived any preemptive right
         or right of first offer any such  stockholder  may have to purchase any
         of the Securities.



                           4_9 No  Litigation.  There shall not be any Action of
         or  before  any  Governmental  Authority  or other  Person  pending  or
         threatened with respect to this Agreement, the other Purchase Documents
         or the  transactions  contemplated  hereby or  thereby  or which  might
         materially adversely affect the Condition of the Company.



                           4_10  Opinion of  Counsel.  The  Investor  shall have
         received from Schnader Harrison Segal & Lewis LLP an opinion of counsel
         dated as of the Closing Date, in the form attached hereto as Exhibit C.



                           4_11 Compliance Certificate.  The Investor shall have
         received a certificate  dated as of the day of the Closing  executed by
         the President and the Chief Financial Officer of the Company certifying
         that the conditions specified in this Section 4 have been fulfilled.



                           4_12 Related Documents.  The Purchase Documents shall
         have been executed and delivered by each of the parties  thereto and in
         full  force  and  effect,  and  the  Articles  of  Amendment,  and  all
         amendments thereto, if any, shall have been filed with the Secretary of
         State of the  Commonwealth of  Pennsylvania  and shall be in full force
         and effect.



                           4_13     Due Diligence.   The  Investor  shall   have
         completed  its  business,  financial  and  legal  due  diligence to its
         satisfaction, in its sole judgment.



                           4_14  Proceedings  and Documents.  All proceedings in
         connection with the transactions  contemplated hereby and all documents
         and instruments  incident to such transactions shall be satisfactory in
         substance  and form to the Investor  and its  counsel,  in all material
         respects,  and the Investor  shall have  received all such  counterpart
         originals  or  certified  or  other  copies  of such  documents  as the
         Investor may reasonably request.



                  If at the Closing the Company  fails to tender to the Investor
the  documents  specified  herein  which are  required  to be  delivered  to the
Investor at the Closing or if at the Closing any of the conditions  specified in
this  Section 4 shall  not have  been  fulfilled  to the  Investor's  reasonable
satisfaction,  the Investor shall,  at its election,  be relieved of all further
obligations under this Agreement.

                  5  Conditions of the Company's  Obligations  at Closing.  The
         obligations  of the Company to the Investor  under this  Agreement  are
         subject to the fulfillment,  prior to or at the Closing, of each of the
         following conditions:



<PAGE>




                           5_1    Representations     and    Warranties.     The
         representations  and  warranties  of the  Investor  contained  in  this
         Agreement shall be true and correct in all material  respects on and as
         of the date of the Closing as if made on and as of such date.



                           5_2 Payment of Purchase  Price.  The  Investor  shall
         have delivered to the Company the purchase price specified in Section 1
         hereof.



                           5_3 No  Litigation.  There shall not be any Action of
         or  before  any  Governmental  Authority  or other  Person  pending  or
         threatened   with  respect  to  this  Agreement  or  the   transactions
         contemplated hereby.



                           5_4  Proceedings  and Documents.  All  proceedings in
         connection with the transactions  contemplated hereby and all documents
         and instruments  incident to such transactions shall be satisfactory in
         substance  and form to the  Company  and its  counsel,  and the Company
         shall have  received  all such  counterpart  originals  or certified or
         other copies of such documents as it may reasonably request.



                  If at the Closing the Investor  fails to tender to the Company
the payment or documents  specified herein which are required to be delivered to
the Company at the Closing or if at the Closing any of the conditions  specified
in this  Section 5 shall not have been  fulfilled  to the  Company's  reasonable
satisfaction,  the Company  shall,  at its election,  be relieved of all further
obligations to the Investor under this Agreement.

                  6       Certain  Post-Closing  Covenants of the Company.  The
         Company  covenants and agrees with the Investor as follows:





<PAGE>


                           6_1 Board Meetings; Observer Rights. The Company will
         use its best  efforts  to  ensure  that its  Board of  Directors  holds
         meetings no less than four times per year.  The  Company  shall give to
         the  Investor  notice of each  meeting of the Board of Directors of the
         Company and of each committee  thereof at the same time and in the same
         manner as notice is given to the directors of the Company. One designee
         of the Investor shall be entitled to attend in person,  as an observer,
         all meetings held in person and to listen to telephone  meetings of the
         Board of Directors of the Company and of each committee  thereof solely
         for the purpose of allowing the  Investor to have  current  information
         with respect to the affairs of the Company.  The Company  shall provide
         to the Investor,  in connection with each meeting its observer designee
         is entitled to attend,  whether or not present at such meeting,  copies
         of  all  notices,   minutes,   consents  and  all  other  materials  or
         information  that it provides  to the  directors  with  respect to such
         meeting,  at the time such materials and  information  are given to its
         directors (except that materials and information  provided to directors
         of the Company at  meetings at which a designee of the  Investor is not
         present shall be provided to the Investor  promptly after the meeting).
         If the Board of  Directors  of the  Company  or any  committee  thereof
         proposes  to take any action by  written  consent in lieu of a meeting,
         the Company shall give written  notice thereof to the Investor prior to
         the effective date of such consent  describing in reasonable detail the
         nature  and  substance  of such  action.  The  Company  shall  bear all
         reasonable  travel  and  related  expenses  incurred  by  the  observer
         designee  of the  Investor  associated  with  attending  meetings.  The
         Investor's  observer  rights under this Section 6.1 shall  terminate in
         the event the Investor holds less than 100 shares of Series F Stock.



                           6_2 Annual Meetings.  The Company will hold an annual
         meeting of all  stockholders at which  information  with respect to its
         business will be furnished and discussed.



                           6_3 Information. The Investor and its assignees shall
         be  entitled  to  receive,  and the  Company  agrees to  provide to the
         Investor and its assignees, the following:



                           _a_              Financial and Related Data.



                           (i) As soon as available,  but in any event not later
         than  forty-five  (45) days after the end of each fiscal  quarter,  the
         Company  shall  deliver to the  Investor its  Quarterly  Report on Form
         10-Q.



                           (ii) As soon as  available,  but in any event  within
         ninety (90) days after the end of each fiscal year of the Company,  the
         Company shall deliver to the Investor its Annual Report on Form 10-K.



                           (iii)  Promptly,  but in any  event  within  ten (10)
         days,  after  any  distribution  to its  stockholders  generally  or to
         specific  stockholders by agreement,  to its directors,  to prospective
         investors  or to the  financial  community of an annual  report,  proxy
         statement,   registration   statement  or  other   similar   report  or
         communication,   a  copy  of  each  such   report,   proxy   statement,
         registration  statement or other similar report or  communication;  and
         promptly,  but in any event  within ten (10) days after any filing with
         the Securities and Exchange  Commission or with any national securities
         exchange or with the National Association of Securities Dealers,  Inc.,
         of any publicly available annual or periodic or special report or proxy
         statement  or  registration   statement,  a  copy  of  such  report  or
         statement; and promptly, but in any event within two (2) business days,
         after released,  copies of all press releases and other statements made
         available  generally by the Company to the public  concerning  material
         developments.



                           (iv) From time to time, and promptly, such additional
         information  and  financial  data  regarding   results  of  operations,
         financial  condition,  business,  affairs or  prospects of the Company,
         which  the  Investor  may  reasonably   request.   Notwithstanding  the
         foregoing,  the  Company  shall  not be  required  to  disclose  to the
         Investor material non-public information as determined in good faith by
         the Board of Directors.





<PAGE>


                                    _b_     Access  to Properties.   The Company
         shall  permit   representatives  designated   by   the  Investor,  upon
         reasonable  prior  notice  to the Company,  to  visit  and inspect each
         of  the  Company's  properties,   Notwithstanding  the  foregoing,  the
         Company shall not be required to disclose to the Investor material non-
         public  information  as  determined  in  good  faith  by  the  Board of
         Directors  to  examine  its  respective corporate and financial records
         (and  make  copies  thereof  or  extracts  therefrom),  to  discuss its
         respective  affairs, finances and accounts with the Company's directors
         and  officers,  and, through the President or chief  financial  officer
         of  the   Company's,   as  the case  may  be,  its  key  employees  and
         accountants,   all  at such reasonable times as may be requested by the
         Investor.



                           6_4  Exemption  from  Investment   Company  Act.  The
         Company  shall  conduct  its  business  so that it shall not  become an
         "investment  company" within the meaning of the Investment  Company Act
         of 1940, as amended.



                           6_5  Accounting  and  Reserves.   The  Company  shall
         maintain a standard  and uniform  system of  accounting  and shall keep
         proper books and records and  accounts in which full,  true and correct
         entries shall be made of its transactions,  all in accordance with GAAP
         applied on a consistent basis through all periods,  and shall set aside
         on such  books  for  each  fiscal  year all such  proper  reserves  for
         depreciation,  obsolescence, amortization, bad debts and other purposes
         in connection with its operations as are required by such principles so
         applied.



                           6_6   Transactions   with   Affiliates.   Except  for
         arrangements for development  research involving aggregate amounts less
         than $60,000, the Company shall not, directly or indirectly, enter into
         any transaction or agreement with any stockholder of the Company or any
         Affiliate of the Company,  unless the  transaction  or agreement is (i)
         reviewed  and  approved by a majority of  Disinterested  Directors  (as
         defined  below) and (ii) on terms no less favorable to the Company than
         those  obtainable  from  a  non-Affiliated   Person.  A  "Disinterested
         Director"  shall mean an individual  who is not and who has not been an
         officer  or  employee  of the  Company  and who is not a member  of the
         family of, controlled by or under common control with, any such officer
         or employee.



                           6_7      Additional Covenants.



                                    _a_     The  Company  shall  timely file all
         such SEC Documents  required to be filed by it pursuant to the Exchange
         Act in order to permit sales under Rule 144 of the Securities Act.



                                    _b_     During   any  period  in  which  the
         Company  is not  subject to Section 13 or  15(d)  of the  Exchange Act,
         the  Company  shall  make available information required to be provided
         by Rule 144A(d)(4), upon request.



                                    _c_     Upon  the request  of  the  Investor
         and  the  certification  of  the Investor that it qualifies  under Rule
         144(k) of  the Securities  Act,  the  Company  shall,  without  further
         requirement,   remove  all  restrictive  legends  from  the  Investor's
         securities,  insofar  as  such  restrictions  relate to the transfer of
         such securities under the Securities Act.





<PAGE>


                           6_8 Issuance of Warrants.  In the event that upon the
         first  anniversary  of the Closing  Date (the  "Anniversary  Date") the
         average  of the  closing  prices  of the  Common  Stock  on the  Nasdaq
         SmallCap Market (or such other quotation system or securities  exchange
         upon which the  Company's  Common  Stock is then traded) as reported by
         the Nasdaq Stock Market on the 25 consecutive  trading days immediately
         preceding the Anniversary Date (the  "Anniversary  Price") is less than
         1.45 times the Closing  Price,  the Company shall grant to the Investor
         five-year warrants ("Warrants") to purchase, at an exercise price equal
         to the Anniversary  Price, such number of shares of the Common Stock as
         determined in accordance with the following formula:

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

W=                 I        x       ((1.45 x CP) - AP)
            ---------------   ---------------------------
               (1.00)                   0.45 x CP
--------- ----------------- --- ---------------------------

where:

W = the number of Warrants issuable pursuant to this Section 6.8.

I = the Investment Amount.

CP = the Closing Price.

AP = the Anniversary Price.

The form of such Warrants is attached  hereto as Exhibit D. It is understood and
agreed  that in no event shall the  Anniversary  Price be deemed to be less than
$1.00.

                           6_9      Registration of Shares of Conversion Stock
and the Warrant Shares.



                                    _a_     The  Company agrees to  register the
         shares of  Conversion  Stock  by filing  a  registration  Statement  on
         Form S-3 (or any  successor form thereto) with respect to the shares of
         Conversion  Stock  and using its best efforts to have such registration
         statement  declared  effective on or  prior  to the  Anniversary  Date.
         The  Company  shall  cause  such  registration   statement   to  remain
         effective  for  three  (3)  years following the Anniversary Date.



                                    _b_     The  Company  agrees to use its best
         efforts  to  register  the  Warrant  Shares  by  filing  a registration
         statement  on  Form S-3  (or any successor form thereto),  as  soon  as
         practicable  after  the  Anniversary Date,  but in  no event later than
         thirty (30) days after the Anniversary Date, and using its best efforts
         to h ave  such  registration  statement  become effective  as  soon  as
         practicable.  The  Company  shall  cause  such registration   statement
         to remain effective for three (3) years following the Anniversary Date.



                                    _c_     In the  event the  Company  fails to
         satisfy  its  obligations  to the Investor  under this Section 6.9, the
         Company shall be obligated to pay to the  Investor  liquidated  damages
         in an amount equal to six percent (6%) per month (or any part thereof),
         compounded  monthly,  on the Investment  Amount,   until such  time the
         Company is no longer in breach of this Section 6.9. Any payments due to
         the Investor  pursuant  to  this  Section 6.9(c) shall be made no later
         than the  fifteenth  (15th)  day  of the month  following  the month in
         which such  liquidated  damages were incurred.





<PAGE>


                           6_10 Stockholder Approval. In the event the aggregate
         number of shares of Common Stock  issuable  upon the  conversion of the
         Securities,   the  Warrants  and  any  other  securities  that  may  be
         integrated   therewith  exceeds  19.9%  of  the  Company's  issued  and
         outstanding capital stock as of the Closing Date, the Company shall use
         its best  efforts to obtain  stockholder  approval  as required by NASD
         Rule  4310(c)(25)(H)(i) as soon as practicable.  Until such stockholder
         approval  is  obtained,  the maximum  number of shares of Common  Stock
         issuable upon conversion of the Series F Stock and upon exercise of the
         Warrants shall not exceed 19.9% of the Company's issued and outstanding
         capital  stock as of the Closing  Date.  In the event such  stockholder
         approval is not  obtained  by the  Anniversary  Date then,  at any time
         after the Anniversary Date until such time such stockholder approval is
         obtained,  out of any assets of the Company legally available therefor,
         the  Investor  shall  have the right to  require  to  Company to redeem
         shares of the Series F Stock  (the  "Redeemed  Shares")  at a price per
         share  equal to the  closing  price of the  Common  Stock on the Nasdaq
         SmallCap Market (or such other quotation system or securities  exchange
         upon  which  the  Company's  Common  Stock  is then  traded)  less  the
         Conversion  Price (as  defined in the  Articles of  Amendment)  then in
         effect.  The Company  shall pay the Investor  for the  Redeemed  Shares
         within five (5) business  days after the demand for  redemption is made
         by the  Investor.  Such  amounts  payable  to the  Investor  under this
         Section  6.10 shall  accrue  interest  at 8% per annum after such 5-day
         period  and such  accrued  interest  shall be  payable on demand of the
         Investor.



                  6.11 Exchange Right.  For the first ninety (90) days following
         the  Closing  Date,  if Company  shall raise  capital or  complete  any
         financing that includes  options,  warrants,  debt or other instruments
         exercisable or  convertible  into equity of the Company with rights and
         preferences  that vary from the  Series F Stock  (the "New  Security"),
         Investor shall have the right, but not the requirement, to exchange all
         (but not less than all) of the  Series F Stock for an amount of the New
         Securities equal to the Investment Amount. Company shall be required to
         notify  Investor  of the  proposed  issuance of any New  Security,  and
         Investor  shall have a period of ten (10) days following such notice to
         notify the  Company in writing of his intent to  exercise  his right to
         exchange the Series F Stock for the New  Securities.  In the event that
         Investor  fails to  respond  to the  Company  within  such ten (10) day
         period,  such failure to respond  shall be deemed to be a waiver of the
         exchange  right by Investor.  The  Company's  notice under this Section
         6.11 shall include all terms of the proposed New Securities and related
         documentation  to enable  Investor  to make an informed  decision.  The
         Company  shall  make  its  appropriate   officers  and  representatives
         available  to  Investor  and  his  representatives  to  make  full  and
         reasonable inquiry into the terms of the New Securities.

                  7_  Certain  Post-Closing   Covenants  of  the  Investor.  The
         Investor covenants and agrees with the Company as follows:



                           7_1 Hedging Activities. The Investor shall not engage
         in any  hedging  transactions  (including  short  sales,  put and  call
         options,  cashless  collar  transactions  or other forms of  derivative
         security  transactions)  with respect to the Common Stock that may have
         an impact on the market price of the Common Stock.





<PAGE>


                           7_2  Limitation  on Sales.  Except for block sales of
         25,000 shares or more,  commencing on the Anniversary  Date, during any
         10-day trading period,  the Investor agrees that all sales of shares of
         Conversion Stock or Warrant Shares, if any, made by the Investor during
         such 10-day trading period shall not exceed  twenty-five  percent (25%)
         of  total   reported  sales  of  shares  of  Common  Stock  during  the
         immediately  preceding  10-day  trading  period.   Notwithstanding  the
         foregoing,  in the event there are additional  Investors purchasing the
         Series F Stock at the Closing each such  Investor  shall be entitled to
         sell only such  Investor's  pro rata share of such shares of Conversion
         Stock or Warrant Shares,  as the case may be,  determined in accordance
         with the Investment  Amount paid by each such Investor  compared to the
         Total Investment  Amount.  The "Total Investment Amount" shall mean the
         sum of all  Investment  Amounts paid by each  Investor  purchasing  the
         Series F Stock at the Closing.



                  8_       Miscellaneous.



                           8_1   Expenses.   The  Company  will  each  bear  all
         reasonable  legal and other  expenses  incurred  by the  Investor  with
         respect to the execution of this Agreement and the execution of each of
         the Purchase Documents.



                           8_2  Publicity.  Except as may be required by Law, or
         in connection with a public offering, the Company shall neither use the
         name of, nor make  reference to, the Investor or any of its  Affiliates
         in any press  release or in any public  manner  without the  Investor's
         prior written consent.



                           8_3 Indemnification.  The Company agrees to indemnify
         the Investor and each  officer,  director,  employee,  agent,  partner,
         stockholder   and   Affiliate  of  the  Investor   (collectively,   the
         "Indemnified  Parties") for, and hold each  Indemnified  Party harmless
         from and  against:  (i) any and all damages,  losses,  claims and other
         liabilities  of any and  every  kind,  including,  without  limitation,
         judgments and costs of settlement,  and (ii) any and all  out-of-pocket
         costs  and  expenses  of  any  and  every  kind,   including,   without
         limitation,  reasonable  fees and  disbursements  of  counsel  for such
         Indemnified  Parties  (all of  which  expenses  periodically  shall  be
         reimbursed  as incurred),  in each case,  arising out of or suffered or
         incurred   in   connection   with  any  of  the   following:   (a)  any
         misrepresentation  or any breach of any  warranty  made by the  Company
         herein or in any of the other  Purchase  Documents,  (b) any  breach or
         non-fulfillment of any covenant or agreement made by the Company herein
         or in any of the other Purchase  Documents,  and (c) any claim relating
         to or  arising  out of a  violation  of  applicable  federal  or  state
         securities  laws by the  Company  in  connection  with  the sale of the
         Securities by the Company to the Investor.



                           8_4  Survival.   All   representations,   warranties,
         covenants  and  agreements  contained  in  or  made  pursuant  to  this
         Agreement or contained in any  certificate  delivered  pursuant to this
         Agreement,  shall  remain  operative  and in  full  force  and  effect,
         regardless  of any  investigation  made by or on  behalf  of any  party
         hereto,  and shall survive the transfer and payment for the  Securities
         and the consummation of the transactions contemplated hereby; provided,
         however,  that the  representations  and  warranties of the parties set
         forth in Sections 2 and 3 shall survive until May __, 2000.



<PAGE>




                           8_5 Assignment. This Agreement and all the provisions
         hereof  shall be  binding  upon and shall  inure to the  benefit of the
         parties hereto and their  respective  successors  and assigns,  if any,
         except  that  neither  this  Agreement  nor any  rights or  obligations
         hereunder  shall be assigned or  delegated  by the Company  without the
         prior written consent of the Investor. After the Closing, except as set
         forth on Schedule 8.5, the Investor and its successors and assigns may,
         without  the consent of the  Company,  assign  this  Agreement  and the
         Investor's  rights  hereunder  and under the other  Purchase  Documents
         (including,   without  limitation,  the  Securities  purchased  by  the
         Investor),  in whole or in part,  to (i) any Affiliate of the Investor;
         (ii) any other transferee of at least 20% of the Securities acquired by
         the Investor; or (iii) in connection with an estate transfer, provided,
         however,  that  the  Company  shall  not be  required  to  permit  such
         Assignment  if such  Assignment  is in violation of federal  securities
         regulations or relevant state "blue sky" laws.



                           8_6 Amendment;  Waiver. Any term, covenant, agreement
         or condition of this Agreement may be amended, and compliance therewith
         may be waived  (either  generally or in a particular  circumstance  and
         either  retroactively or  prospectively),  by one or more substantially
         concurrent  written  instruments  signed  by  the  Company  and  by the
         Investor.  Any  amendment or waiver  effected in  accordance  with this
         paragraph shall be binding upon the Investor and the Company.



                           8_7 Applicable Law. The laws of the State of New York
         shall govern the interpretation,  validity and performance of the terms
         of this  Agreement,  regardless  of the law that might be applied under
         principles of conflicts of law.



                           8_8 Judicial  Proceedings.  Any  judicial  proceeding
         involving any dispute,  controversy or claim arising out of or relating
         to this  Agreement  or the rights or  interests  of the Investor or the
         Company  or the  breach or alleged  breach of this  Agreement,  whether
         arising during or at or after the  termination of this Agreement  (each
         of  the  foregoing  disputes,   controversies  and  claims  hereinafter
         referred  to as an  "agreement  dispute"),  shall be brought  only in a
         federal or state  court  located in the state of New York,  and each of
         the  parties   hereto  (i)   unconditionally   accepts  the   exclusive
         jurisdiction  of  such  courts  and any  related  appellate  court  and
         irrevocably  agrees to be bound by any  judgment  rendered  thereby and
         (ii)  irrevocably  waives  any  objection  such  party  may now have or
         hereafter has as to the venue of any such proceeding  brought in such a
         court or that such court is an inconvenient  forum. Each of the parties
         hereto hereby waives trial by jury in any judicial  proceeding to which
         they are parties involving an agreement dispute.



                           8_9  Notices.  All notices  and other  communications
         provided  for herein  shall be dated and in writing and shall be deemed
         to have  been  duly  given (x) on the date of  delivery,  if  delivered
         personally  or by  telecopier,  receipt  confirmed,  (y) on the  second
         following business day, if delivered by a recognized  overnight courier
         service,  or (z) seven days after  mailing,  if sent by  registered  or
         certified, return receipt requested,  postage prepaid, in each case, to
         the party to whom it is directed at the  following  address (or at such
         other address as any party hereto shall hereafter  specify by notice in
         writing to the other parties hereto):



<PAGE>




                          (i) If to the Company, to it at the following address:

                           Sedona Corporation
                           649 North Lewis Road, Suite 220
                           Limerick, PA 19468
                           Attn: President
                           Telephone: (610) 495-3003
                           Telecopier: (610) 495-3092

                           with a copy to:
                           Schnader Harrison Segal & Lewis LLP
                           1300 Eye Street, N.W., 11th Floor East
                           Washington, DC 2005
                           Attention Robert B. Murphy, Esq.
                           Telephone: (202) 216-4200
                           Telecopier (202) 775-8741

                          (ii)  If to the  Investor,  to  him  at the  following
address:

                           The Tang Fund
                           600 Fifth Avenue, 8th Floor
                           New York, New York 10020
                           Telephone: (212) 830-5301
                           Telecopier (212) 265-9752

                           with a copy to:
                           Seward & Kissel LLP
                           1 Battery Park Plaza
                           New York, New York 10004
                           Attn: Robert VanGrover, Esq.
                           Telephone: (212) 574-1205
                           Telecopier: (212) 480-8421

                           8_10  Integration.  This  Agreement and the documents
         referred  to herein or  delivered  pursuant  hereto or pursuant to such
         documents,  including  all exhibits and  schedules,  contain the entire
         understanding  of the parties with respect to their subject  matter and
         supersede all prior agreements and  understandings  between the parties
         with respect to their subject matter.


                           8_11  Severability.  Each provision of this Agreement
         shall be  interpreted in such manner as to be effective and valid under
         applicable  law, but if any  provision of this  Agreement is held to be
         prohibited or invalid under  applicable  law,  such  provision  will be
         ineffective  only to the  extent  of such  prohibition  or  invalidity,
         without invalidating the remainder of this Agreement.




<PAGE>


                           8_12  Descriptive  Headings.  The  section  and other
         headings  contained in this Agreement are for  convenience of reference
         only and  shall  not  affect  the  meaning  or  interpretation  of this
         Agreement.


                           8_13 Counterparts.  This Agreement may be executed in
         two or more counterparts,  each of which when so executed and delivered
         shall be deemed to be an original  and all of which  together  shall be
         deemed to be one and the same agreement.


                            [Signature page follows]



<PAGE>












IN  WITNESS  WHEREOF,   the  parties have executed this Agreement as of the date
first above written:






COMPANY:


Sedona Corporation



By:_________________________________

Name: Laurence L. Osterwise

Title: President and Chief Executive Officer



INVESTOR:


The Tang Fund


By:_________________________________

Name:

Title: