<PAGE>   1









                         COMMON STOCK PURCHASE AGREEMENT




                          DATED AS OF NOVEMBER 29, 2000




                                 BY AND BETWEEN



                          ARONEX PHARMACEUTICALS, INC.


                                       AND



                                ACQUA WELLINGTON
                       NORTH AMERICAN EQUITIES FUND, LTD.






<PAGE>   2



                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                         Page


<S>                <C>                                                                                   <C>
ARTICLE I          Definitions.............................................................................1

     Section 1.1    Definitions............................................................................1

ARTICLE II         Purchase and Sale of Common Stock.......................................................3

     Section 2.1    Purchase and Sale of Stock.............................................................3
     Section 2.2    The Shares.............................................................................3
     Section 2.3    Purchase Price and Closing.............................................................3

ARTICLE III        Representations and Warranties..........................................................4

     Section 3.1    Representations and Warranties of the Company..........................................4
     Section 3.2    Representations and Warranties of the Purchaser.......................................10

ARTICLE IV         Covenants..............................................................................12

     Section 4.1    Securities Compliance.................................................................12
     Section 4.2    Registration and Listing..............................................................12
     Section 4.3    Registration Statement................................................................12
     Section 4.4    Compliance with Laws..................................................................12
     Section 4.5    Keeping of Records and Books of Account...............................................13
     Section 4.6    Reporting Requirements................................................................13
     Section 4.7    Non-public Information................................................................13
     Section 4.8    Effective Registration Statement......................................................13
     Section 4.9    No Stop Orders........................................................................13
     Section 4.10   Amendments to the Registration Statement..............................................14
     Section 4.11   Prospectus Delivery...................................................................14
     Section 4.12   Other Financing.......................................................................14
     Section 4.13   Notice................................................................................15

ARTICLE V          Conditions to Closing, Draw Downs and Call Options.....................................15

     Section 5.1    Conditions Precedent to the Obligation of the Company to
                       Issue a Draw Down Notice or Grant a Call Option and
                       Sell the Shares....................................................................15
     Section 5.2    Conditions Precedent to the Obligation of the Purchaser to
                       Close..............................................................................16
     Section 5.3    Conditions Precedent to the Obligation of the Purchaser to
                       Accept a Draw Down or Call Option Grant and Purchase
                       the Shares.........................................................................17
</TABLE>



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<PAGE>   3


<TABLE>

<S>                <C>                                                                                   <C>
ARTICLE VI         Draw Down Terms; Call Option...........................................................18

     Section 6.1    Draw Down Terms.......................................................................18
     Section 6.2    Purchaser's Call Option...............................................................21

ARTICLE VII        Termination............................................................................21

     Section 7.1    Termination by Mutual Consent.........................................................21
     Section 7.2    Other Termination.....................................................................22
     Section 7.3    Effect of Termination.................................................................22

ARTICLE VIII       Indemnification........................................................................22

     Section 8.1    General Indemnity.....................................................................22
     Section 8.2    Indemnification Procedures............................................................24

ARTICLE IX         Miscellaneous..........................................................................25

     Section 9.1    Fees and Expenses.....................................................................25
     Section 9.2    Specific Enforcement, Consent to Jurisdiction.........................................25
     Section 9.3    Entire Agreement; Amendment...........................................................25
     Section 9.4    Notices...............................................................................26
     Section 9.5    Waivers...............................................................................27
     Section 9.6    Headings..............................................................................27
     Section 9.7    Successors and Assigns................................................................27
     Section 9.8    Governing Law.........................................................................27
     Section 9.9    Survival..............................................................................27
     Section 9.10   Counterparts..........................................................................27
     Section 9.11   Publicity.............................................................................27
     Section 9.12   Severability..........................................................................28
     Section 9.13   Further Assurances....................................................................28
</TABLE>



                                      -ii-

<PAGE>   4


                         COMMON STOCK PURCHASE AGREEMENT


         This COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is dated as of
November 29, 2000 by and between Aronex Pharmaceuticals, Inc., a Delaware
corporation (the "Company"), and Acqua Wellington North American Equities Fund,
Ltd., a limited liability company organized under the laws of the Commonwealth
of The Bahamas (the "Purchaser").

         The parties hereto agree as follows:


                                    ARTICLE I

                                   Definitions

                  SECTION 1.1  Definitions.

                  (a) "Alternate Market" shall mean the Nasdaq Small Cap Market,
the American Stock Exchange, the New York Stock Exchange or the OTC Bulletin
Board, whichever is at the time the principal trading exchange or market for the
Common Stock.

                  (b) "Call Option" shall have the meaning assigned to such term
in Section 6.2(a) hereof.

                  (c) "Commission" shall mean the Securities and Exchange
Commission.

                  (d) "Commission Documents" shall have the meaning assigned to
such term in Section 3.1(f) hereof.

                  (e) "Commission Filings" means the Company's Form 10-K/A for
the fiscal year ended December 31, 1999, Forms 10-Q for the periods ended March
31, 2000, June 30, 2000 and September 30, 2000, Registration Statement on Form
S-3, No. 333-50020 and Form 8-K, dated April 17, 2000 and all other filings made
by the Company after the date hereof pursuant to the Securities Exchange Act of
1934.

                  (f) "Common Stock" shall have the meaning assigned to such
term in Section 2.1 hereof.

                  (g) "Draw Down" means the exercise by the Company of its right
to request the purchase of shares of Common Stock by the Purchaser.

                  (h) "Draw Down Amount" means the actual amount of a Draw Down
up to $1,500,000 or such other amount mutually agreed upon by the Purchaser and
the Company.

                  (i) "Draw Down Discount Percentage" means (i) 91% if the
Threshold Price is equal to or greater than $3.00 but less than $4.00 and (ii)
93% if the Threshold Price is equal to


                                      -1-
<PAGE>   5
or greater than $4.00 but less than $6.00; provided, however, that for every
$2.00 increase in the Threshold Price above $4.00, the draw down discount
percentage shall be increased 0.25%, incrementally, provided, further, that if
the Threshold Price is equal to or greater than $10.00 the draw down discount
percentage shall be equal to 93.75%.

                  (j) "Draw Down Exercise Date" shall have the meaning assigned
to such term in Section 5.1 hereof.

                  (k) "Draw Down Notice" shall have the meaning assigned to such
term in Section 6.1(i) hereof.

                  (l) "Draw Down Pricing Period" shall mean a period of twenty
(20) consecutive Trading Days following a Draw Down Notice, or such other period
mutually agreed upon by the Purchaser and the Company.

                  (m) "Effective Date" shall mean November 21, 2000, the date
the Registration Statement of the Company covering the Shares being subscribed
for hereby was declared effective.

                  (n) "Investment Period " shall have the meaning assigned to
such term in Section 7.1 hereof.

                  (o) "Material Adverse Effect" shall mean any effect on the
business, results of operations, prospects, assets or financial condition of the
Company that is material and adverse to the Company and its subsidiaries and
affiliates, taken as a whole and/or any condition, circumstance, or situation
that would prohibit or otherwise interfere with the ability of the Company to
enter into and perform any of its obligations under this Agreement or the
Registration Rights Agreement in any material respect.

                  (p) "Material Change in Ownership" shall mean that, as of any
particular measurement date, the officers and directors of the Company and their
affiliates shall beneficially own in the aggregate less than 2% of the
outstanding Common Stock of the Company, except that for purposes of making any
such calculation, Common Stock issued to the Purchaser pursuant to this
Agreement shall not be included in such calculation.

                  (q) "Prospectus" as used in this Agreement means the
prospectus in the form included in the Registration Statement, as supplemented
by any prospectus supplement filed with the Commission pursuant to Rule 424(b).

                  (r) "Registration Statement" shall mean the registration
statement on Form S-3, Commission File Number 333-50020 under the Securities
Act, filed with the Commission for the registration of the Shares, as such
Registration Statement may be amended from time to time.

                  (s) "Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations of the Commission thereunder.



                                      -2-
<PAGE>   6

                  (t) "Settlement Date" shall have the meaning assigned to such
term in Section 6.1(d) hereof.

                  (u) "Shares" shall mean the shares of Common Stock of the
Company that may be purchased hereunder.

                  (v) "Threshold Price" is the lowest price at which the Company
may set in the Draw Down Notice to sell Shares during a Draw Down Pricing Period
(not taking into account the Draw Down Discount Percentage during such Draw Down
Pricing Period).

                  (w) "Trading Day" shall mean a day on which the Common Stock
is traded on the Nasdaq National Market or an Alternate Market.

                  (x) "VWAP" shall mean the daily volume weighted average price
(based on a Trading Day from 9:30 a.m. to 4:00 p.m., eastern time) of the Common
Stock of the Company on the NASDAQ National Market or an Alternate Market as
reported by Bloomberg Financial LP using the AQR function.



                                   ARTICLE II

                        PURCHASE AND SALE OF COMMON STOCK

                  SECTION 2.1 Purchase and Sale of Stock. Subject to the terms
and conditions of this Agreement, the Company shall issue and sell to the
Purchaser and the Purchaser shall purchase from the Company up to $24,000,000 of
the Company's common stock, $0.001 par value per share (the "Common Stock"),
based on Draw Downs, subject to Section 6.1 hereof, of up to $1,500,000 per Draw
Down and Call Options, subject to Section 6.2 hereof, of up to twice the Draw
Down Amount for the applicable Draw Down Pricing Period that the Company may
grant to the Purchaser in the Company's sole discretion.

                  SECTION 2.2 The Shares. The Company has authorized and has
reserved and covenants to continue to reserve, subject to Section 4.4(b) hereof,
free of preemptive rights and other similar contractual rights of stockholders,
a sufficient number of its authorized but unissued shares of its Common Stock to
cover the Shares to be issued in connection with all Draw Downs and Call
Options.

                  SECTION 2.3 Purchase Price and Closing. The Company agrees to
issue and sell to the Purchaser and, in consideration of and in express reliance
upon the representations, warranties, covenants, terms and conditions of this
Agreement, the Purchaser agrees to purchase that number of the Shares to be
issued in connection with each Draw Down and each Call Option exercised by the
Purchaser. The closing of the execution and delivery of this Agreement shall
take place at the offices of Parker Chapin LLP, The Chrysler Building, 405
Lexington Avenue, New York, NY 10174 (the "Closing") at 10:00 a.m., eastern
time, on (i) November 29, 2000, or (ii) such other time and place or on such
date as the Purchaser and the Company may agree upon (the "Closing Date"). Each
party shall deliver all documents, instruments and writings required to be
delivered by such party pursuant to this Agreement at or prior to the Closing.



                                      -3-
<PAGE>   7

                                  ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

                  SECTION 3.1 Representations and Warranties of the Company. The
Company hereby makes the following representations and warranties to the
Purchaser:

                  (a) Organization, Good Standing and Power. The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of Delaware and has the requisite corporate power to own, lease and operate
its properties and assets and to conduct its business as it is now being
conducted. As of the date hereof, the Company does not have any subsidiaries (as
defined in Section 3.1(g)) except as set forth in the Registration Statement and
in the Company's most recent Form 10-K, as amended, including the accompanying
financial statements (the "Form 10-K"), or in the Company's most recent Form
10-Q (the "Form 10-Q"), or on Schedule 3.1(g) attached hereto. The Company and
each such subsidiary is duly qualified as a foreign corporation to do business
and is in good standing in every jurisdiction in which the nature of the
business conducted or property owned by it makes such qualification necessary
except for any jurisdiction in which the failure to be so qualified will not
have a Material Adverse Effect.

                  (b) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and perform this Agreement and to
issue and sell the Shares in accordance with the terms hereof. The execution,
delivery and performance of this Agreement by the Company and the consummation
by it of the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action, and, except as contemplated by
Section 4.4(b), no further consent or authorization of the Company or its Board
of Directors or stockholders is required. This Agreement has been duly executed
and delivered by the Company. This Agreement constitutes, or shall constitute
when executed and delivered, a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, conservatorship, receivership or
similar laws relating to, or affecting generally the enforcement of, creditor's
rights and remedies or by other equitable principles of general application.

                  (c) Capitalization. The authorized capital stock of the
Company and the shares thereof issued and outstanding as of the date hereof are
set forth in the Registration Statement or in the Form 10-K. All of the
outstanding shares of the Common Stock have been duly and validly authorized,
and are fully paid and non-assessable. Except as set forth in this Agreement
including Schedule 3.1(c), as of the date hereof no shares of Common Stock are
entitled to preemptive rights or registration rights and there are no
outstanding options, warrants, scrip, rights to subscribe to, call or
commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company. Furthermore,
except as set forth in this Agreement including Schedule 3.1(c), as of the date
hereof there are no contracts, commitments, understandings, or arrangements by
which the Company is or may become bound to issue additional shares of the
capital stock of the Company or options, securities or rights convertible into
shares of capital stock of the Company. Except for customary transfer
restrictions contained in agreements entered into by the Company in order to



                                      -4-
<PAGE>   8

sell restricted securities or as set forth in Schedule 3.1(c), as of the date
hereof, the Company is not a party to any agreement granting registration rights
to any person with respect to any of its equity or debt securities. The Company
is not a party to, and it has no knowledge of, any agreement restricting the
voting or transfer of any shares of the capital stock of the Company. The offer
and sale of all capital stock, convertible securities, rights, warrants, or
options of the Company issued prior to the Closing complied with all applicable
federal and state securities laws, and no stockholder has a right of rescission
or damages with respect thereto which would have a Material Adverse Effect. The
Company has furnished or made available to the Purchaser true and correct copies
of the Company's Certificate of Incorporation and in effect on the date hereof
(the "Charter"), and the Company's Bylaws as in effect on the date hereof (the
"Bylaws").

                  (d) Issuance of Shares. The Shares to be issued under this
Agreement have been duly authorized by all necessary corporate action and, when
paid for and issued in accordance with the terms hereof, the Shares shall be
validly issued and outstanding, fully paid and non-assessable, and the Purchaser
shall be entitled to all rights accorded to a holder of Common Stock.

                  (e) No Conflicts. The execution, delivery and performance of
this Agreement by the Company and the consummation by the Company of the
transactions contemplated herein do not (i) violate any provision of the
Company's Charter or Bylaws, (ii) conflict with, or constitute a default (or an
event which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or
cancellation of, any material agreement, mortgage, deed of trust, indenture,
note, bond, license, lease agreement, instrument or obligation to which the
Company is a party, (iii) create or impose a lien, charge or encumbrance on any
property of the Company under any agreement or any commitment to which the
Company is a party or by which the Company is bound or by which any of its
respective properties or assets are bound, or (iv) result in a violation of any
federal, state, local or foreign statute, rule, regulation, order, judgment or
decree (including federal and state securities laws and regulations) applicable
to the Company or any of its subsidiaries or by which any property or asset of
the Company or any of its subsidiaries are bound or affected, except, in all
cases (other than violations pursuant to clauses (i) and (iv) (to the extent of
federal securities law)), for such conflicts, defaults, terminations,
amendments, acceleration, cancellations and violations as would not,
individually or in the aggregate, have a Material Adverse Effect. The Company is
not required under federal, state or local law, rule or regulation to obtain any
consent, authorization or order of, or make any filing or registration with, any
court or governmental agency in order for it to execute, deliver or perform any
of its obligations under this Agreement, or issue and sell the Shares in
accordance with the terms hereof (other than any filings which may be required
to be made by the Company with the Commission, or the Nasdaq National Market
subsequent to the Closing, and, any registration statement which may be filed
pursuant hereto); provided that, for purpose of the representation made in this
sentence, the Company is assuming and relying upon the accuracy of the relevant
representations and agreements of the Purchaser herein.

                  (f) Commission Documents, Financial Statements. The Common
Stock of the Company is registered pursuant to Section 12(b) or 12(g) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and since
May 1, 1999, the Company has timely filed all reports, schedules, forms,
statements and other documents required to be filed by it with the



                                      -5-
<PAGE>   9

Commission pursuant to the reporting requirements of the Exchange Act, including
material filed pursuant to Section 13(a) or 15(d) of the Exchange Act (all of
the foregoing including filings incorporated by reference therein being referred
to herein as the "Commission Documents"). The Company has delivered or made
available to the Purchaser true and complete copies of the Commission Documents
filed with the Commission since December 31, 1999 and prior to the Closing Date.
The Company has not provided to the Purchaser any information which, according
to applicable law, rule or regulation, should have been disclosed publicly by
the Company but which has not been so disclosed, other than with respect to the
transactions contemplated by this Agreement. The Form 10-K for the year ended
December 31, 1999 complied in all material respects with the requirements of the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder and other federal, state and local laws, rules and regulations
applicable to such documents, and the said Form 10-K did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. The financial
statements of the Company included in the Commission Documents comply as to form
in all material respects with applicable accounting requirements and the
published rules and regulations of the Commission or other applicable rules and
regulations with respect thereto. Such financial statements have been prepared
in accordance with generally accepted accounting principles ("GAAP") applied on
a consistent basis during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the notes thereto or (ii) in the case
of unaudited interim statements, to the extent they may not include footnotes or
may be condensed or summary statements), and fairly present in all material
respects the financial position of the Company and its subsidiaries as of the
dates thereof and the results of operations and cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments).

                  (g) Subsidiaries. The Commission Documents or Schedule 3.1(g)
attached hereto set forth each subsidiary of the Company as of the date hereof,
showing the jurisdiction of its incorporation or organization and showing the
percentage of each person's ownership of the outstanding stock or other
interests of such subsidiary. For the purposes of this Agreement, "subsidiary"
shall mean any corporation or other entity of which at least a majority of the
securities or other ownership interest having ordinary voting power (absolutely
or contingently) for the election of directors or other persons performing
similar functions are at the time owned directly or indirectly by the Company
and/or any of its other subsidiaries. Except as set forth in the Commission
Documents or the Commission Filings, none of such subsidiaries is a "significant
subsidiary" as defined in Regulation S-X.

                  (h) No Material Adverse Effect. Since September 30, 2000, the
Company has not experienced or suffered any Material Adverse Effect.

                  (i) No Undisclosed Liabilities. Except as disclosed on the
Commission Documents or the Commission Filings, the Company has no liabilities,
obligations, claims or losses (whether liquidated or unliquidated, secured or
unsecured, absolute, accrued, contingent or otherwise) that would be required to
be disclosed on a balance sheet of the Company or any subsidiary (including the
notes thereto) in conformity with GAAP not disclosed in the Commission
Documents, other than those incurred in the ordinary course of the Company's or
its



                                      -6-
<PAGE>   10

subsidiaries respective businesses since September 30, 2000 and which,
individually or in the aggregate, do not or would not have a Material Adverse
Effect.

                  (j) No Undisclosed Events or Circumstances. No event or
circumstance has occurred or exists with respect to the Company or its
subsidiaries or their respective businesses, properties, prospects, operations
or financial condition, which, under applicable law, rule or regulation,
requires public disclosure or announcement by the Company but which has not been
so publicly announced or disclosed and which, individually or in the aggregate,
do not or would not have a Material Adverse Effect.

                  (k) Indebtedness. Schedule 3.1(k) and the Commission Filings
set forth as of September 30, 2000 all outstanding secured and unsecured
Indebtedness of the Company, or for which the Company or any subsidiary has
commitments. For the purposes of this Agreement, "Indebtedness" shall mean (a)
any liabilities for borrowed money or amounts owed in excess of $100,000 (other
than trade accounts payable and liabilities related to clinical expenses
incurred in the ordinary course of business), (b) all guaranties, endorsements
and other contingent obligations in respect of Indebtedness of others, whether
or not the same are or should be reflected in the Company's balance sheet (or
the notes thereto), except guaranties by endorsement of negotiable instruments
for deposit or collection or similar transactions in the ordinary course of
business; and (c) the present value of any lease payments in excess of $100,000
due under leases required to be capitalized in accordance with GAAP. Neither the
Company or any subsidiary is in default with respect to any Indebtedness.

                  (l) Title to Assets. Each of the Company and its subsidiaries
has good and marketable title to all of its real and personal property reflected
in the Commission Documents, free of any mortgages, pledges, charges, liens,
security interests or other encumbrances, except for those indicated in the
Commission Documents or the Commission Filings or such that could not reasonably
be expected to cause a Material Adverse Effect. All said leases of the Company
and each of its subsidiaries are valid and subsisting and in full force and
effect in all material respects.

                  (m) Actions Pending. There is no action, suit, claim,
investigation or proceeding pending or, to the knowledge of the Company,
threatened against the Company which questions the validity of this Agreement or
the transactions contemplated hereby or any action taken or to be taken pursuant
hereto or thereto. There is no action, suit, claim, investigation or proceeding
pending or, to the knowledge of the Company, threatened, against or involving
the Company or any subsidiary, or any of their respective properties or assets
which, if adversely determined, is reasonably likely to result in a Material
Adverse Effect, except as described in the Commission Filings or Commission
Documents.

                  (n) Compliance with Law. The business of the Company has been
and is presently being conducted in accordance with all applicable federal,
state and local governmental laws, rules, regulations and ordinances, except
such that do not cause a Material Adverse Effect. Each of the Company and its
subsidiaries has all franchises, permits, licenses, consents and other
governmental or regulatory authorizations and approvals necessary for the
conduct of its business as now being conducted unless the failure to possess
such franchises, permits, licenses,



                                      -7-
<PAGE>   11

consents and other governmental or regulatory authorizations and approvals,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.

                  (o) Certain Fees. No brokers, finders or financial advisory
fees or commissions will be payable by the Company with respect to the
transactions contemplated by this Agreement.

                  (p) Disclosure. To the Company's knowledge, neither this
Agreement or the Schedules hereto nor any other documents, certificates or
instruments furnished to the Purchaser by or on behalf of the Company in
connection with the transactions contemplated by this Agreement contain any
untrue statement of a material fact or omits to state a material fact necessary
in order to make the statements made herein or therein, in the light of the
circumstances under which they were made herein or therein, not misleading.

                  (q) Operation of Business. The Company or its subsidiaries
owns or has a valid right to use all patents, trademarks, service marks, trade
names, copyrights, licenses and authorizations as set forth in the Commission
Documents or the Commission Filings and all rights with respect to the
foregoing, which are necessary for the conduct of its business as now conducted
without any conflict with the rights of others, except to the extent set forth
in the Commission Documents or the Commission Filings that a Material Adverse
Effect could not reasonably be expected to result from such conflict.

                  (r) Environmental Compliance. Except as disclosed in the
Commission Filings, the Company has obtained all approvals, authorization,
certificates, consents, licenses, orders and permits or other similar
authorizations of all governmental authorities, or from any other person, that
are required under any Environmental Laws except where the failure to do so
would not have a Material Adverse Effect. "Environmental Laws" shall mean all
applicable laws relating to the protection of the environment including, without
limitation, all requirements pertaining to reporting, licensing, permitting,
controlling, investigating or remediating emissions, discharges, releases or
threatened releases of hazardous substances, chemical substances, pollutants,
contaminants or toxic substances, materials or wastes, whether solid, liquid or
gaseous in nature, into the air, surface water, groundwater or land, or relating
to the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of hazardous substances, chemical substances, pollutants,
contaminants or toxic substances, material or wastes, whether solid, liquid or
gaseous in nature. Except for such instances as would not individually or in the
aggregate have a Material Adverse Effect, to the best of the Company's
knowledge, there are no past or present events, conditions, circumstances,
incidents, actions or omissions relating to or in any way affecting the Company
that violate or could reasonably be expected to violate any Environmental Law
after the Closing or that could reasonably be expected to give rise to any
environmental liability, or otherwise form the basis of any claim, action,
demand, suit, proceeding, hearing, study or investigation (i) under any
Environmental Law, or (ii) based on or related to the manufacture, processing,
distribution, use, treatment, storage (including without limitation underground
storage tanks), disposal, transport or handling, or the emission, discharge,
release or threatened release of any hazardous substance.

                  (s) Material Agreements. Except as set forth in the Commission
Documents and this Agreement, the Company is not a party to any written or oral
contract, instrument,



                                      -8-
<PAGE>   12

agreement, commitment, obligation, plan or arrangement, a copy of which would be
required to be filed with the Commission as an exhibit to a registration
statement on Form S-3 or applicable form (collectively, "Material Agreements")
if the Company was registering securities under the Securities Act. The Company
has in all material respects performed all the obligations required to be
performed by it to date under the foregoing agreements, has received no notice
of default and, to the best of the Company's knowledge is not in default under
any Material Agreement now in effect, the result of which could reasonably be
expected to cause a Material Adverse Effect.

                  (t) Transactions with Affiliates. Except as disclosed in the
Commission documents or the Commission Filings, there are no loans, leases,
agreements, contracts, royalty agreements, management contracts or arrangements
or other continuing transactions exceeding $250,000 between (a) the Company, or
any of its customers (excluding agreements related to the purchase or lease of
the Company's products) or suppliers on the one hand, and (b) on the other hand,
any officer, employee, consultant or director of the Company, or any person who
would be covered by Item 404(a) of Regulation S-K or any corporation or other
entity controlled by such officer, employee, consultant, director or person.

                  (u) Securities Act of 1933. The Company has complied in all
material respects with all applicable federal and state securities laws in
connection with the offer, issuance and sale of the Shares hereunder.

                      (i) Each Prospectus included as part of the Registration
Statement as originally filed or as part of any amendment or supplement thereto,
or filed pursuant to Rule 424 under the Securities Act, complied when so filed
in all material respects with the provisions of the Securities Act. The
Commission has not issued any order preventing or suspending the use of any
Prospectus.

                      (ii) The Company meets the requirements for the use of
Form S-3 under the Securities Act. The Registration Statement in the form in
which it became effective and also in such form as it may be when any
post-effective amendment thereto became effective and the Prospectus and any
supplement or amendment thereto when filed with the Commission under Rule 424(b)
under the Securities Act, complied in all material respects with the provisions
of the Securities Act and did not at any such times contain an 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 (in the case of the
Prospectus, in the light of the circumstances under which they made) not
misleading, except that this representation and warranty does not apply to
statements in or omissions from the Registration Statement or the Prospectus
made in reliance upon and in conformity with information relating to the
Purchaser furnished to the Company in writing by or on behalf of the Purchaser
expressly for use therein.

                      (iii) The Company has not distributed and, prior to the
completion of the sale of the Shares to the Purchaser, will not distribute any
offering material in connection with the offering and sale of the Shares other
than the Registration Statement, the Prospectus or other materials, if any,
permitted by the Securities Act.

                  (v) Employees. As of the date hereof, the Company has no
collective bargaining arrangements or agreements covering any of its employees.
Each of the Company



                                      -9-
<PAGE>   13

and its subsidiaries requires its officers, technical employees and certain
consultants to enter into agreements regarding proprietary information and
assignment of inventions, or other similar agreements containing restrictive
covenants. As of the date hereof, since December 31, 1999, no officer,
consultant or key employee of the Company whose termination, either individually
or in the aggregate, could reasonably be expected to have a Material Adverse
Effect, has terminated or, to the knowledge of the Company, has any present
intention of terminating his or her employment or engagement with the Company.

                  (w) Use of Proceeds. The proceeds from the sale of the Shares
will be used by the Company and its subsidiaries for the purposes set forth in
the Registration Statement.

                  (x) Public Utility Holding Company Act and Investment Company
Act Status. The Company is not a "holding company" or a "public utility company"
as such terms are defined in the Public Utility Holding Company Act of 1935, as
amended. The Company is not, and as a result of and immediately upon Closing
will not be, an "investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.

                  (y) ERISA. No liability to the Pension Benefit Guaranty
Corporation has been incurred with respect to any Plan (as defined below) by the
Company which is or would have a Material Adverse Effect. The execution and
delivery of this Agreement and the issue and sale of the Shares will not involve
any transaction which is subject to the prohibitions of Section 406 of ERISA or
in connection with which a tax could be imposed pursuant to Section 4975 of the
Internal Revenue Code of 1986, as amended, provided that, if any of the
Purchaser, or any person or entity that owns a beneficial interest in any of the
Purchaser, is an "employee pension benefit plan" (within the meaning of Section
3(2) of ERISA) with respect to which the Company is a "party in interest"
(within the meaning of Section 3(14) of ERISA), the requirements of Sections
407(d)(5) and 408(e) of ERISA, if applicable, are met. As used in this Section
3.1(y), the term "Plan" shall mean an "employee pension benefit plan" (as
defined in Section 3 of ERISA) which is or has been established or maintained,
or to which contributions are or have been made, by the Company or by any trade
or business, whether or not incorporated, which, together with the Company, is
under common control, as described in Section 414(b) or (c) of the Code.

                  (z) Acknowledgment Regarding Purchaser's Purchase of Shares.
The Company acknowledges and agrees that the Purchaser is acting solely in the
capacity of arm's length purchaser with respect to this Agreement and the
transactions contemplated hereunder. The Company further acknowledges that the
Purchaser is not acting as a financial advisor or fiduciary of the Company (or
in any similar capacity) with respect to this Agreement and the transactions
contemplated hereunder and any advice given by the Purchaser or any of its
representatives or agents in connection with this Agreement and the transactions
contemplated hereunder is merely incidental to the Purchaser's purchase of the
Shares.



                                      -10-
<PAGE>   14

                  SECTION 3.2 Representations and Warranties of the Purchaser.
The Purchaser hereby makes the following representations and warranties to the
Company:

                  (a) Organization and Standing of the Purchaser. The Purchaser
is a limited liability company duly organized, validly existing and in good
standing under the laws of the Commonwealth of the Bahamas.

                  (b) Authorization and Power. The Purchaser has the requisite
corporate power and authority to enter into and perform this Agreement and to
purchase the Shares in accordance with the terms hereof. The execution, delivery
and performance of this Agreement by Purchaser and the consummation by it of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action, and no further consent or authorization of the Purchaser, its
Board of Directors or stockholders is required. This Agreement constitutes, or
shall constitute when executed and delivered, a valid and binding obligation of
the Purchaser enforceable against the Purchaser in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation, conservatorship,
receivership, or similar laws relating to, or affecting generally the
enforcement of, creditor's rights and remedies or by other equitable principles
of general application.

                  (c) No Conflicts. The execution, delivery and performance of
this Agreement and the consummation by the Purchaser of the transactions
contemplated hereby and thereby or relating hereto do not and will not (i)
result in a violation of such Purchaser's charter documents or bylaws or (ii)
conflict with, or constitute a default (or an event which with notice or lapse
of time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of any material agreement,
mortgage, deed of trust, indenture, note, bond, license, lease agreement,
instrument or obligation to which the Purchaser is a party, (iii) create or
impose a lien, charge or encumbrance on any property of the Purchaser under any
agreement or any commitment to which the Purchaser is party or by which the
Purchaser is or by which any of its properties or assets are bound or (iv)
result in a violation of any law, rule, or regulation, or any order, judgment or
decree of any court or governmental agency applicable to the Purchaser or its
properties, except for such conflicts, defaults and violations as would not,
individually or in the aggregate, prohibit or otherwise interfere with the
ability of the Purchaser to enter into and perform its obligations under this
Agreement in any material respect. The Purchaser is not required to obtain any
consent, authorization or order of, or make any filing or registration with, any
court or governmental agency in order for it to execute, deliver or perform any
of its obligations under this Agreement or to purchase the Shares in accordance
with the terms hereof, provided that for purposes of the representation made in
this sentence, the Purchaser is assuming and relying upon the accuracy of the
relevant representations and agreements of the Company herein.

                  (d) Information. The Purchaser and its advisors, if any, have
been furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the
Shares which have been requested by the Purchaser. The Purchaser and its
advisors, if any, have been afforded the opportunity to ask questions of the
Company. The Purchaser has sought such accounting, legal and tax advice as it
has considered necessary to make an informed investment decision with respect to
its acquisition of the Shares. Purchaser understands that it (and not the
Company) shall be responsible for its own tax liabilities that may arise as a
result of this investment or the transactions contemplated by this Agreement.



                                      -11-
<PAGE>   15

                  (e) Selling Restriction. The Purchaser has the right to sell
shares of the Common Stock during the Investment Period. The Purchaser
covenants, however, that prior to and during the Investment Period, neither the
Purchaser nor any of its affiliates nor any entity managed by the Purchaser will
ever sell shares of Common Stock of the Company other than what the Purchaser
has accumulated to purchase under the terms of this Agreement in any accounts
directly or indirectly managed by the Purchaser or any affiliate of the
Purchaser or any entity managed by the Purchaser. In addition, on a daily
Trading Day basis, the Purchaser agrees to restrict the volume of sales of
Shares to no more than thirty-five (35%) of the total trading volume of the
Common Stock, as reported on Bloomberg Financial LP using HP Function, for such
Trading Day.


                                   ARTICLE IV

                                    COVENANTS

         The Company covenants with the Purchaser as follows, which covenants
are for the benefit of the Purchaser and its permitted assignees, that during
the term of this Agreement:

                  SECTION 4.1 Securities Compliance. The Company shall notify
the Commission and the Nasdaq National Market or an Alternate Market, if
applicable, in accordance with their rules and regulations, 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 Shares to the Purchaser.

                  SECTION 4.2 Registration and Listing. The Company will take
all action necessary to cause its Common Stock to continue to be registered
under Sections 12(b) or 12(g) of the Exchange Act, will comply in all respects
with its reporting and filing obligations under the Exchange Act, and will not
take any action or file any document (whether or not permitted by the Securities
Act or the rules promulgated thereunder) to terminate or suspend such
registration or to terminate or suspend its reporting and filing obligations
under the Exchange Act or Securities Act, except as permitted herein. The
Company will take all action necessary to continue the listing or trading of its
Common Stock and the listing of the Shares purchased by Purchaser hereunder on
the Nasdaq National Market or an Alternate Market and will comply in all
respects with the Company's reporting, filing and other obligations under the
bylaws or rules of the Nasdaq National Market or an Alternate Market.

                  SECTION 4.3 Registration Statement. Before the Company shall
issue a Draw Down Notice, the Company shall have caused a sufficient number of
shares of Common Stock to be authorized and registered to cover the Shares to be
issued in connection with this Agreement.

                  SECTION 4.4 Compliance with Laws.

                  (a) The Company shall comply with all applicable laws, rules,
regulations and orders, noncompliance with which could have a Material Adverse
Effect.



                                      -12-
<PAGE>   16

                  (b) The Company will not be obligated to issue and the
Purchaser will not be obligated to purchase any shares of the Common Stock which
would result in the issuance under this Agreement of more than nineteen and
nine-tenths percent (19.9%) of the issued and outstanding shares of the Common
Stock, unless such issuance has been duly approved by the shareholders of the
Company.

                  SECTION 4.5 Keeping of Records and Books of Account. The
Company shall keep adequate records and books of account, in which complete
entries will be made in accordance with GAAP consistently applied, reflecting
all financial transactions of the Company and its subsidiaries, and in which,
for each fiscal year, all proper reserves for depreciation, depletion,
obsolescence, amortization, taxes, bad debts and other purposes in connection
with its business shall be made.

                  SECTION 4.6 Reporting Requirements. Upon written request, the
Company shall furnish or make available the following to the Purchaser so long
as such Purchaser shall be obligated hereunder to purchase Shares:

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

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

                  SECTION 4.7 Non-public Information. Neither the Company nor
any of its officers or agents shall disclose any material non-public information
about the Company to the Purchaser and neither the Purchaser nor any of its
affiliates, officers or agents will solicit any material non-public information
from the Company.

                  SECTION 4.8 Effective Registration Statement. If it is
necessary for the Registration Statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, the
Company will endeavor to cause the Registration Statement or such post-effective
amendment to become effective as soon as reasonably practicable and will advise
the Purchaser promptly and, if requested by the Purchaser, will confirm such
advice in writing, when it receives notice that the Registration Statement or
such post-effective amendment has become effective.

                  SECTION 4.9 No Stop Orders. The Company will advise the
Purchaser promptly and, if requested by the Purchaser, will confirm such advice
in writing: (i) of its receipt of notice of any request by the Commission for
amendment of or a supplement to the Registration Statement, any Prospectus or
for additional information; (ii) of its receipt of notice of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) of its becoming aware of the happening of any event,
which makes any statement of a material fact made in the Registration Statement
or the Prospectus (as then amended or supplemented) untrue or which



                                      -13-
<PAGE>   17

requires the making of any additions to or changes in the Registration Statement
or the Prospectus (as then amended or supplemented) in order to state a material
fact required by the Securities Act or the regulations thereunder to be stated
therein or necessary in order to make the statements therein not misleading, or
of the necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Securities Act or any other law. If at any time
the Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will make all reasonable efforts to obtain
the withdrawal of such order at the earliest possible time.

                  SECTION 4.10 Amendments to the Registration Statement. The
Company will not (i) file any amendment to the Registration Statement or make
any amendment or supplement to the Prospectus which relates to the Purchaser,
this Agreement or the transactions contemplated hereby of which the Purchaser
shall not previously have been advised or to which the Purchaser shall
reasonably object after being so advised or (ii) so long as, in the reasonable
opinion of counsel for the Purchaser, a Prospectus is required to be delivered
in connection with any purchase of Shares by the Purchaser, file any
information, documents or reports pursuant to the Exchange Act without
delivering a copy of such information, documents or reports to the Purchaser,
promptly following such filing.

                  SECTION 4.11 Prospectus Delivery. The Company shall file a
prospectus supplement to its Registration Statement one Trading Day prior to
each Settlement Date, and will deliver to the Purchaser, without charge, in such
quantities as reasonably requested by the Purchaser, copies of each form of
Prospectus and prospectus supplement on each Settlement Date. The Company
consents to the use of the Prospectus (and of any amendment or supplement
thereto) in accordance with the provisions of the Securities Act and with the
securities or Blue Sky laws of the jurisdictions in which the Shares may be sold
by the Purchaser, in connection with the offering and sale of the Shares and for
such period of time thereafter as the Prospectus is required by the Securities
Act to be delivered in connection with sales of the Shares. If during such
period of time any event shall occur that in the judgment of the Company or in
the opinion of counsel for the Purchaser is required to be set forth in the
Prospectus (as then amended or supplemented) or should be set forth therein in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus to comply with the Securities Act or any other law, the
Company will forthwith prepare and, subject to the provisions of Section 4.10
above, file with the Commission an appropriate supplement or amendment thereto,
and will expeditiously furnish to the Purchaser a reasonable number of copies
thereof.

                  SECTION 4.12 Other Financing. If the Company enters into any
other financing agreement, the primary purpose of which would be to obtain
equity financing for the Company (an "Other Financing"), during a Draw Down
Pricing Period, the Company shall promptly notify the Purchaser of such Other
Financing and the Purchaser shall have the options set forth in Section 6.1(k)
hereof. If the Company enters into the Other Financing between Draw Down Pricing
Periods, the Company shall promptly notify the Purchaser of such Other Financing
and the Purchaser shall have the option, which option shall be exercised no
later than five (5) Trading Days after receipt by the Purchaser of the notice of
the Other Financing, to purchase up to the Draw Down Amount that would be
applicable under this Agreement based on the price per share



                                      -14-
<PAGE>   18

to be paid for the Common Stock in the Other Financing on the same, absolute
terms and conditions contemplated in the Other Financing. If the Purchaser does
not exercise its purchase option in writing before 8:00 p.m. (eastern time) on
the fifth (5th) Trading Day after receipt of such notice, the Company shall not
be obligated to sell shares of the Common Stock to the Purchaser under the terms
of the preceding sentence and the Company shall have the right to close the
Other Financing on the scheduled closing date with a third party, provided that
all of the terms and conditions of such closing are similar in all material
respects to those provided to the Purchaser. As used herein, "Other Financing"
shall not include the Company (i) entering into a loan, credit or lease facility
with a bank or financing institution (including any equity component thereof),
(ii) issuing shares of Common Stock in connection with the Company's current or
future option plans (as the same may be amended from time to time), stock
purchase plans, rights plans, currently outstanding warrants or options,
employment or consulting agreements, or increasing the number of shares
available under any such plans (the primary purpose of which is not to raise
equity), and (iii) issuing shares of Common Stock and/or preferred stock in
connection with the formation and maintenance of strategic partnerships,
alliances or joint ventures, the merger or other consolidation or combination of
the Company with another company or entity in which the Company survives or the
acquisition of products, licenses or other assets (each a "Permitted
Transaction").

                  SECTION 4.13 Notices. The Company shall immediately notify the
Purchaser that (i) a Material Adverse Effect or Material Change in Ownership has
occurred or (ii) the Company has entered into an Other Financing (as defined in
Section 4.12 hereof).


                                   ARTICLE V

               CONDITIONS TO CLOSING, DRAW DOWNS AND CALL OPTIONS

                  SECTION 5.1 Conditions Precedent to the Obligation of the
Company to Issue a Draw Down Notice or Grant a Call Option and Sell the Shares.
The obligation hereunder of the Company to issue a Draw Down Notice or grant a
Call Option and sell the Shares to the Purchaser is subject to the satisfaction
or waiver, at or before each Draw Down or Call Option request (the "Draw Down
Exercise Date"), of each of the conditions set forth below. These conditions are
for the Company's sole benefit and may be waived by the Company at any time in
its sole discretion.

                  (a) Accuracy of the Purchaser's Representations and
Warranties. The representations and warranties of the Purchaser in this
Agreement shall be true and correct in all material respects as of the date when
made and as of each Draw Down Exercise Date and each Settlement Date as though
made at that time, except for representations and warranties that are expressly
made as of a particular date.

                  (b) Registration Statement. The Company shall have Shares
registered under the Registration Statement which are valued at the time of the
Draw Down Notice or Call Option in an amount equal to or in excess of the dollar
amount value of Shares issuable pursuant to such Draw Down Notice or Call
Option. The Registration Statement registering the offer and sale of the Shares
shall have been declared effective by the Commission and shall have been amended



                                      -15-
<PAGE>   19
or supplemented, as required, to disclose the sale of the Shares prior to each
Settlement Date, as applicable, and there shall be no stop order suspending the
effectiveness of the Registration Statement.

                  (c) Performance by the Purchaser. The Purchaser shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Purchaser at or prior to each Settlement Date.

                  (d) No Injunction. No statute, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.

                  (e) No Suspension, Etc. Trading in the Common Stock shall not
have been suspended by the Commission or the Nasdaq National Market or an
Alternate Market (except for any suspension of trading of limited duration
agreed to by the Company, which suspension shall be terminated prior to such
Draw Down Exercise Date and applicable Settlement Date), and, at any time prior
to each Draw Down Exercise Date, trading in securities generally as reported on
the Nasdaq National Market or an Alternate Market shall not have been suspended
or limited, or minimum prices shall not have been established on securities
whose trades are reported by the Nasdaq National Market or an Alternate Market,
nor shall a banking moratorium have been declared either by the United States or
New York State authorities, nor shall there have occurred any material outbreak
or escalation of hostilities or other national or international calamity or
crisis of such magnitude in its effect on, or any material adverse change in any
financial market which, in each case, in the judgment of the Company, makes it
impracticable or inadvisable to issue the Shares.

                  (f) No Proceedings or Litigation. No action, suit or
proceeding before any arbitrator or any governmental authority shall have been
commenced, and no investigation by any governmental authority shall have been
threatened, against the Company, or any of the officers, directors or affiliates
of the Company seeking to restrain, prevent or change the transactions
contemplated by this Agreement, or seeking damages in connection with such
transactions.

                  SECTION 5.2 Conditions Precedent to the Obligation of the
Purchaser to Close. The obligation hereunder of the Purchaser to enter this
Agreement is subject to the satisfaction or waiver, at or before the Closing, of
each of the conditions set forth below. These conditions are for the Purchaser's
sole benefit and may be waived by the Purchaser at any time in its sole
discretion.

                  (a) Accuracy of the Company's Representations and Warranties.
Each of the representations and warranties of the Company shall be true and
correct in all material respects as of the date when made and as of the Closing
Date, as though made at that time, except for representations and warranties
that speak as of a particular date.



                                      -16-
<PAGE>   20

                  (b) Performance by the Company. The Company shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Company at or prior to the Closing.

                  (c) Effective Registration Statement. The Registration
Statement registering the offer and sale of the Shares shall have been declared
effective by the Commission and shall have been amended or supplemented, as
required, to disclose the sale of the Shares prior to each Settlement Date, as
applicable, and there shall be no stop order suspending the effectiveness of the
Registration Statement.

                  (d) No Injunction. No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement.

                  (e) No Proceedings or Litigation. No action, suit or
proceeding before any arbitrator or any governmental authority shall have been
commenced, and no investigation by any governmental authority shall have been
threatened, against the Company, or any of the officers, directors or affiliates
of the Company seeking to restrain, prevent or change the transactions
contemplated by this Agreement, or seeking damages in connection with such
transactions.

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

                  SECTION 5.3 Conditions Precedent to the Obligation of the
Purchaser to Accept a Draw Down or Call Option Grant and Purchase the Shares.
The obligation hereunder of the Purchaser to accept a Draw Down Notice or
exercise a Call Option grant and to acquire and pay for the Shares on the
Settlement Date is subject to the satisfaction or waiver, at or before each Draw
Down Exercise Date and each Settlement Date, as applicable, of each of the
conditions set forth below. The conditions are for the Purchaser's sole benefit
and may be waived by the Purchaser at any time in its sole discretion.

                  (a) Accuracy of the Company's Representations and Warranties.
Each of the representations and warranties of the Company shall be true and
correct in all material respects as of the date when made and as of the Draw
Down Exercise Date and Settlement Date, as applicable, as though made at that
time, except for representations and warranties that speak as of a particular
date.

                  (b) Registration Statement. The Company shall have Shares
registered under the Registration Statement which are valued at the time of the
Draw Down Notice or Call Option in an amount equal to or in excess of the dollar
amount value of Shares issuable pursuant to such Draw Down Notice or Call
Option. The Registration Statement registering the offer and sale of



                                      -17-
<PAGE>   21

the Shares shall have been declared effective by the Commission and shall have
been amended or supplemented, as required, to disclose the sale of the Shares
prior to each Draw Down Exercise Date or each Settlement Date, as applicable,
and there shall be no stop order suspending the effectiveness of the
Registration Statement.

                  (c) No Suspension, Etc. Trading in the Common Stock shall not
have been suspended by the Commission or the Nasdaq National Market or an
Alternate Market (except for any suspension of trading of limited duration
agreed to by the Company, which suspension shall be terminated prior to each
Draw Down Exercise Date), and, at any time prior to such Draw Down Exercise Date
or such Settlement Date, trading in securities generally as reported by the
Nasdaq National Market or an Alternate Market shall not have been suspended or
limited, or minimum prices shall not have been established on securities whose
trades are reported by the Nasdaq National Market or an Alternate Market, nor
shall a banking moratorium have been declared either by the United States or New
York State authorities, nor shall there have occurred any material outbreak or
escalation of hostilities or other national or international calamity or crisis
of such magnitude in its effect on, or any material adverse change in any
financial market which, in each case, in the judgment of the Purchaser, makes it
impracticable or inadvisable to purchase the Shares. The Common Stock shall be
listed on Nasdaq or an Alternate Market.

                  (d) Performance by the Company. The Company shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Company at or prior to the Draw Down Exercise Date and
the Settlement Date and shall have delivered the Compliance Certificate
substantially in the form attached hereto as Exhibit C.

                  (e) No Injunction. No statute, rule, regulation, executive
order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction which prohibits the consummation of any of the transactions
contemplated by this Agreement.

                  (f) No Proceedings or Litigation. No action, suit or
proceeding before any arbitrator or any governmental authority shall have been
commenced, and no investigation by any governmental authority shall have been
threatened, against the Company, or any of the officers, directors or affiliates
of the Company seeking to restrain, prevent or change the transactions
contemplated by this Agreement, or seeking damages in connection with such
transactions.

                  (g) No Material Adverse Effect; No Material Change in
Ownership. No Material Adverse Effect or Material Change in Ownership shall have
occurred.




                                      -18-
<PAGE>   22

                                   ARTICLE VI

                          DRAW DOWN TERMS; CALL OPTION

                  SECTION 6.1 Draw Down Terms. Subject to the satisfaction of
the conditions set forth in this Agreement, the parties agree as follows:

                  (a) The Company, may, in its sole discretion, issue a Draw
Down Notice with respect to a Draw Down during each Draw Down Pricing Period of
up to (i) $500,000 if the Threshold Price is equal to or greater than $3.00 and
less than $4.00; (ii) $750,000 if the Threshold Price is equal to or greater
than $4.00 and up to an additional $250,000 for every $2.00 increase in the
Threshold Price above $4.00, for a maximum Draw Down Amount during each Draw
Down Pricing Period of up to $1,500,000; provided, that the Company may, in its
sole discretion, issue a Draw Down Notice with respect to any Draw Down Amount
at any Threshold Price or any Draw Down Discount Percentage pursuant to terms
mutually agreed upon by the Purchaser and the Company, which Draw Down the
Purchaser will be obligated to accept. Prior to issuing any Draw Down Notice,
the Company shall have Shares registered under the Registration Statement which
are valued in an amount equal to or in excess of the Draw Down Amount.

                  (b) The number of Shares to be issued in connection with each
Draw Down shall be equal to the sum of the quotients (for each Trading Day of
the Draw Down Pricing Period for which the VWAP equals or exceeds the Threshold
Price) of (x) 1/20th (or such other fraction based on the length of the Draw
Down Pricing Period) of the Draw Down Amount divided by (y) the applicable Draw
Down Discount Percentage multiplied by the VWAP of the Common Stock for such
Trading Day.

                  (c) Only one Draw Down shall be allowed in each Draw Down
Pricing Period. Each Draw Down Pricing Period shall consist of two (2) periods
of ten (10) consecutive Trading Days (each, a "Settlement Period").

                  (d) The number of Shares purchased by the Purchaser with
respect to each Draw Down shall be determined on a daily basis during each Draw
Down Pricing Period and settled on the second Trading Day following the end of
each Settlement Period (the "Settlement Date").

                  (e) There shall be a minimum of five (5) Trading Days between
Draw Downs, unless otherwise mutually agreed upon between the Purchaser and the
Company.

                  (f) There shall be a maximum of twenty-four (24) Draw Downs
during the term of this Agreement.

                  (g) Each Draw Down will expire on the end of the last Trading
Day of each Draw Down Pricing Period.

                  (h) If the VWAP on a given Trading Day is less than the
Threshold Price, then the total amount of the Draw Down for the relevant Draw
Down Pricing Period will be reduced by 1/20th (or such other fraction based on
the length of the Draw Down Pricing Period). At no time shall the Threshold
Price be set below $3.00, unless mutually agreed upon by the Company and the
Purchaser. If trading in the Common Stock is suspended for any reason for more
than three (3) hours in any Trading Day, at the Purchaser's option, the price of
the Common Stock shall be deemed to be below the Threshold Price for that
Trading Day and the Draw Down for the relevant Draw Down Pricing Period shall be
reduced by 1/20th (or such other fraction based on the length of the Draw Down
Pricing Period). Notwithstanding anything



                                      -19-
<PAGE>   23

in the foregoing to the contrary, for each Trading Day during the Draw Down
Pricing Period that the VWAP is less than the Threshold Price or is deemed to be
below the Threshold Price pursuant to the immediately preceding sentence, the
Purchaser may elect in its sole discretion to purchase Shares at a price equal
to the Threshold Price multiplied by the Draw Down Discount Percentage at the
end of such Draw Down Pricing Period. The Purchaser will inform the Company via
facsimile transmission no later than 8:00 p.m. (eastern time) on the last
Trading Day of such Draw Down Pricing Period as to the number of Shares, if any,
the Purchaser chooses to purchase under such circumstances set forth in this
Section 6.1(h).

                  (i) The Company must inform the Purchaser via facsimile
transmission as to the Draw Down Amount the Company wishes to exercise before
commencement of trading on the first Trading Day of the Draw Down Pricing Period
(the "Draw Down Notice"), substantially in the form attached hereto as Exhibit
D. In addition to the Draw Down Amount, the Company shall set the Threshold
Price with each Draw Down Notice and shall designate the first Trading Day of
the Draw Down Pricing Period. Notwithstanding anything in the foregoing to the
contrary, if the Company wishes the date of the Draw Down Notice to be the first
day of the Draw Down Pricing Period, the Draw Down Notice must be delivered to
the Purchaser and receipt of such Draw Down Notice confirmed by the Purchaser
prior to the commencement of trading on the date of such Draw Down Notice.

                  (j) On each Settlement Date, the Company shall deliver the
Shares purchased by the Purchaser to the Purchaser or to The Depositary Trust
Company ("DTC") on the Purchaser's behalf via the Deposit Withdrawal Agent
Commission system ("DWAC"), and upon receipt of the Shares, the Purchaser shall
cause payment therefor to be made to the account designated by the Company by
wire transfer of immediately available funds provided that the Shares are
received no later than 1:00 p.m., eastern time, or next day available funds if
the Shares are received thereafter.

                  (k) If during any Draw Down Pricing Period the Company shall
enter into an Other Financing (other than shares of Common Stock issued under
this Agreement or pursuant to a Permitted Transaction), the Purchaser may in its
sole discretion (i) purchase the Draw Down Amount of shares of Common Stock
and/or exercise Call Options granted during such Draw Down Pricing Period on the
terms at which the Company issued shares of Common Stock in the Other Financing
during such Draw Down Pricing Period, (ii) purchase the Draw Down Amount of
shares of Common Stock and/or exercise Call Options granted during such Draw
Down Pricing Period at the applicable Draw Down Discount Percentage times the
VWAP for such Draw Down Pricing Period, or (iii) elect not to purchase any
Shares during such Draw Down Pricing Period. The Purchaser shall notify the
Company of its election on the Trading Day preceding the Settlement Date.

                  (l) If on the Settlement Date, the Company fails to deliver
the Shares to be purchased by the Purchaser, and such failure continues for ten
(10) Trading Days, the Company shall pay, in cash or restricted shares of Common
Stock, at the option of the Purchaser, as liquidated damages and not as a
penalty to the Purchaser an amount equal to two percent (2%) of the Draw Down
Amount for the initial thirty (30) days and each additional thirty (30) day
period thereafter until such failure has been cured, which shall be pro rated
for such periods less than thirty (30) days (the "Periodic Amount"). Cash
payments to be made pursuant to this clause (1)



                                      -20-
<PAGE>   24

shall be due and payable immediately upon demand in immediately available cash
funds. Certificates evidencing the restricted shares of Common Stock shall be
delivered immediately upon demand. The parties agree that the Periodic Amount
represents a reasonable estimate on the part of the parties, as of the date of
this Agreement, of the amount of damages that may be incurred by the Purchaser
if the Company fails to deliver the Shares on the Settlement Date. If the
Purchaser elects to receive shares of Common Stock instead of cash, the
Purchaser shall have the right to demand registration once within twelve (12)
months of the date of issuance of such shares of Common Stock and piggyback
registration rights if the Company files a separate registration statement.

                  SECTION 6.2 Purchaser's Call Option.

                  (a) During each Draw Down Pricing Period, the Company at its
sole discretion may grant to the Purchaser the right to exercise multiple call
options of up to twice the applicable Draw Down Amount (a "Call Option"). The
amount of the Call Option shall be set forth in the Draw Down Notice. For each
Trading Day during a Draw Down Pricing Period, the Purchaser may exercise a Call
Option by providing notice to the Company of the exercise of a Call Option (the
"Call Option Notice"), substantially in the form attached hereto as Exhibit E.

                  (b) The number of shares of Common Stock to be issued in
connection with each Call Option shall equal the quotient of (i) the amount of
the Call Option exercised and (ii) the product of the applicable Draw Down
Discount Percentage and the greater of (A) the VWAP for the Common Stock on the
day the Purchaser issues its Call Option Notice and (B) the Threshold Price.

                  (c) Each Call Option exercised shall be settled on the
applicable Settlement Date.

                  (d) The Threshold Price designated by the Company in its Draw
Down Notice shall apply to each Call Option.

                  (e) For each Call Option that the Purchaser exercises pursuant
to this Section 6.2, the Purchaser must issue via facsimile a Call Option Notice
to the Company no later than 8:00 p.m. (eastern time) on the day such Call
Option is exercised. If the Purchaser does not exercise a Call Option by 8:00
p.m. (eastern time) on the last day of the applicable Draw Down Pricing Period,
the Purchaser's Call Options with respect to that Draw Down Pricing Period shall
terminate.


                                  ARTICLE VII

                                   TERMINATION

                  SECTION 7.1 Termination by Mutual Consent. The term of this
Agreement shall be the earlier of (i) twenty-eight (28) months from the date of
execution of this Agreement (the "Investment Period"), (ii) the date that all of
the shares of Common Stock registered under the Registration Statement have been
issued and sold and (iii) the date that the Purchaser has purchased in the
aggregate $24,000,000 of shares of the Common Stock pursuant to all Draw



                                      -21-
<PAGE>   25

Downs issued and Call Options granted and exercised. This Agreement may be
terminated at any time by mutual consent of the parties.

                  SECTION 7.2 Other Termination. The Company shall inform the
Purchaser, and the Purchaser shall have the right to terminate this Agreement
within the subsequent thirty (30) days (the "Event Period"), if (x) the Company
enters into an Other Financing (other than a Permitted Transaction) without the
prior consent of the Purchaser, which consent will not be unreasonably delayed,
conditioned or withheld, which provides for (i) the issuance of Common Stock or
securities convertible, exercisable or exchangeable into Common Stock at a
discount to the then current market price of the Common Stock, except for such
issuance in a public underwritten offering, (ii) a mechanism for the reset of
the purchase price of the Common Stock to below the then current market price of
the Common Stock, or (iii) the issuance of Common Stock with warrants, which
have an exercise price such that together with the price of the Common Stock
would result in the issuance of shares of Common Stock at a per share price
below the then current market price of the Common Stock, or (y) an event
resulting in a Material Adverse Effect or Material Change in Ownership has
occurred. The Purchaser may terminate this Agreement upon one (1) day's notice
during the Event Period.

                  SECTION 7.3 Effect of Termination. In the event of termination
by the Company or the Purchaser, written notice thereof shall forthwith be given
to the other party and the transactions contemplated by this Agreement shall be
terminated without further action by either party. If this Agreement is
terminated as provided in Section 7.1 or 7.2 herein, this Agreement shall become
void and of no further force and effect, except as provided in Section 9.9
hereof. Nothing in this Section 7.3 shall be deemed to release the Company or
the Purchaser from any liability for any breach under this Agreement, or to
impair the rights of the Company and the Purchaser to compel specific
performance by the other party of its obligations under this Agreement.


                                  ARTICLE VIII

                                 INDEMNIFICATION

                  SECTION 8.1 General Indemnity.

                  (a) Indemnification by the Company. The Company will indemnify
and hold harmless the Purchaser, each of its directors, fund managers and
officers, and each person, if any, who controls the Purchaser within the meaning
of Section 15 of the Securities Act or Section 20(a) of the Exchange Act from
and against any losses, claims, damages, liabilities and expenses (including
reasonable costs of defense and investigation and all reasonable attorneys'
fees) to which the Purchaser, each of its directors, fund managers and officers,
and each person, if any, who controls the Purchaser may become subject, under
the Securities Act or otherwise, insofar as such losses, claims, damages,
liabilities and expenses (or actions in respect thereof) arise out of or are
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained, or incorporated by reference, in the Registration Statement
relating to Common Stock being sold to the Purchaser (including any prospectus
supplement filed in connection with the transactions contemplated hereunder (the
"Prospectus Supplement") which are a part of it), or



                                      -22-
<PAGE>   26

any amendment or supplement to it, or (ii) the omission or alleged omission to
state in that Registration Statement or any document incorporated by reference
in the Registration Statement, a material fact required to be stated therein or
necessary to make the statements therein not misleading, provided that the
Company shall not be liable under this Section 8.1(a) to the extent that a court
of competent jurisdiction shall have determined by a final judgment (with no
appeals available) that such loss, claim, damage, liability or action resulted
directly from any such acts or failures to act, undertaken or omitted to be
taken by the Purchaser or such person through its bad faith or willful
misconduct; provided, however, that the foregoing indemnity shall not apply to
any loss, claim, damage, liability or expense to the extent, but only to the
extent, arising out of or based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company by the Purchaser
expressly for use in the Registration Statement, any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto); and provided, further,
that with respect to the Prospectus, the foregoing indemnity shall not inure to
the benefit of the Purchaser or any such person from whom the person asserting
any loss, claim, damage, liability or expense purchased Common Stock, if copies
of the Prospectus were timely delivered to the Purchaser pursuant hereto and a
copy of the Prospectus (as then amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) was not sent or given by
or on behalf of the Purchaser or any such person to such person, if required by
law so to have been delivered, at or prior to the written confirmation of the
sale of the Common Stock to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage, liability or expense.

         The Company will reimburse the Purchaser and each such controlling
person promptly upon demand for any legal or other costs or expenses reasonably
incurred by the Purchaser or any controlling person in investigating, defending
against, or preparing to defend against any such claim, action, suit or
proceeding, except that the Company will not be liable to the extent a claim or
action which results in a loss, claim, damage, liability or expense arises out
of, or is based upon, an untrue statement, alleged untrue statement, omission or
alleged omission, included in any Registration Statement, Prospectus or
Prospectus Supplement or any amendment or supplement thereto in reliance upon,
and in conformity with, written information furnished by the Purchaser to the
Company for inclusion in the Registration Statement, Prospectus or Prospectus
Supplement.

                  (b) Indemnification by the Purchaser. The Purchaser will
indemnify and hold harmless the Company, each of its directors and officers, and
each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20(a) of the Exchange Act from and against any
expenses (including reasonable costs of defense and investigation and all
attorneys' fees) to which the Company and each director, officer and person, if
any, who controls the Company may become subject, under the Securities Act or
otherwise, insofar as such losses, claims, damages, liabilities and expenses (or
actions in respect thereof) arise out of or are based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any Prospectus or Prospectus Supplement or any
amendment or supplement to it or (ii) the omission or alleged omission to state
in the Registration Statement or any Prospectus or Prospectus Supplement or any
amendment or supplement to it a material fact required to be stated therein or
necessary to make the statements therein not misleading, to the extent, but only
to the extent, the untrue statement, alleged untrue



                                      -23-
<PAGE>   27

statement, omission or alleged omission was made in reliance upon, and in
conformity with, written information furnished by the Purchaser to the Company
for inclusion in the Registration Statement, the Prospectus or Prospectus
Supplement or an amendment or supplement thereto, and the Purchaser will
reimburse the Company and each such director, officer or controlling person
promptly upon demand for any legal or other costs or expenses reasonably
incurred by the Company or the other person in investigating, defending against,
or preparing to defend against any such claim, action, suit or proceeding.

                  SECTION 8.2 Indemnification Procedures. Promptly after a
person receives notice of a claim or the commencement of an action for which the
person intends to seek indemnification under paragraph (a) or (b) of Section
8.1, the person will notify the indemnifying party in writing of the claim or
commencement of the action, suit or proceeding, but failure to notify the
indemnifying party will not relieve the indemnifying party from liability under
paragraph (a) or (b) of Section 8.1, except to the extent it has been materially
prejudiced by the failure to give notice. The indemnifying party will be
entitled to participate in the defense of any claim, action, suit or proceeding
as to which indemnification is being sought, and if the indemnifying party
acknowledges in writing the obligation to indemnify the party against whom the
claim or action is brought, the indemnifying party may (but will not be required
to) assume the defense against the claim, action, suit or proceeding with
counsel satisfactory to it. After an indemnifying party notifies an indemnified
party that the indemnifying party wishes to assume the defense of a claim,
action, suit or proceeding the indemnifying party will not be liable for any
legal or other expenses incurred by the indemnified party in connection with the
defense against the claim, action, suit or proceeding except that if, in the
opinion of counsel to the indemnifying party, one or more of the indemnified
parties should be separately represented in connection with a claim, action,
suit or proceeding the indemnifying party will pay the reasonable fees and
expenses of one separate counsel for the indemnified parties. Each indemnified
party, as a condition to receiving indemnification as provided in Paragraph (a)
or (b) or Section 8.1, will cooperate in all reasonable respects with the
indemnifying party in the defense of any action or claim as to which
indemnification is sought. No indemnifying party will be liable for any
settlement of any action effected without its prior written consent. No
indemnifying party will, without the prior written consent of the indemnified
party, effect any settlement of a pending or threatened action with respect to
which an indemnified party is, or is informed that it may be, made a party and
for which it would be entitled to indemnification, unless the settlement
includes an unconditional release of the indemnified party from all liability
and claims which are the subject matter of the pending or threatened action.

         If for any reason the indemnification provided for in this Agreement is
not available to, or is not sufficient to hold harmless, an indemnified party in
respect of any loss or liability referred to in paragraph (a) or (b) of Section
8.1, each indemnifying party will, in lieu of indemnifying the indemnified
party, contribute to the amount paid or payable by the indemnified party as a
result of the loss or liability, (i) in the proportion which is appropriate to
reflect the relative benefits received by the indemnifying party on the one hand
and by the indemnified party on the other from the sale of stock which is the
subject of the claim, action, suit or proceeding which resulted in the loss or
liability or (ii) if that allocation is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits of the
sale of stock, but also the relative fault of the indemnifying party and the
indemnified party with respect to the



                                      -24-
<PAGE>   28

statements or omissions which are the subject of the claim, action, suit or
proceeding that resulted in the loss or liability, as well as any other relevant
equitable considerations.


                                   ARTICLE IX

                                  MISCELLANEOUS

                  SECTION 9.1 Fees and Expenses. Each party shall bear its own
fees and expenses related to the transactions contemplated by this Agreement;
provided, that the Company shall pay, at the Closing, all reasonable attorneys
fees and expenses (exclusive of disbursements and out-of-pocket expenses)
incurred by the Purchaser of up to $50,000 in connection with the preparation,
negotiation, execution and delivery of this Agreement. In addition, the Company
shall pay all reasonable fees and expenses incurred by the Purchaser in
connection with any amendments, modifications or waivers of this Agreement or
incurred in connection with the enforcement of this Agreement, including,
without limitation, all reasonable attorneys' fees and expenses.

                  SECTION 9.2 Specific Enforcement, Consent to Jurisdiction.

                  (a) The Company and the Purchaser acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent or cure breaches of the provisions of
this Agreement and to enforce specifically the terms and provisions hereof or
thereof, this being in addition to any other remedy to which any of them may be
entitled by law or equity.

                  (b) Each of the Company and the Purchaser (i) hereby
irrevocably submits to the jurisdiction of the United States District Court and
other courts of the United States sitting in the State of New York for the
purposes of any suit, action or proceeding arising out of or relating to this
Agreement and (ii) hereby waives, and agrees not to assert in any such suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of such court, that the suit, action or proceeding is brought in an
inconvenient forum or that the venue of the suit, action or proceeding is
improper. Each of the Company and the Purchaser consents to process being served
in any such suit, action or proceeding by mailing a copy thereof to such party
at the address in effect for notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing in this Section shall affect or limit any right to serve
process in any other manner permitted by law.

                  SECTION 9.3 Entire Agreement; Amendment. This Agreement
contains the entire understanding of the parties with respect to the matters
covered hereby and, except as specifically set forth herein, neither the Company
nor the Purchaser makes any representations, warranty, covenant or undertaking
with respect to such matters. No provision of this Agreement may be waived or
amended other than by a written instrument signed by the party against whom
enforcement of any such amendment or waiver is sought.



                                      -25-
<PAGE>   29

                  SECTION 9.4 Notices. Any notice, demand, request, waiver or
other communication required or permitted to be given hereunder shall be in
writing and shall be effective (a) upon hand delivery, by telecopy or facsimile
at the address or number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first
business day following such delivery (if delivered other than on a business day
during normal business hours where such notice is to be received) or (b) on the
second business day following the date of mailing by express courier service,
fully prepaid, addressed to such address, or upon actual receipt of such
mailing, whichever shall first occur. The addresses for such communications
shall be:


If to the Company:                      Aronex Pharmaceuticals, Inc.
                                        8707 Technology Forest Place
                                        The Woodlands, Texas 77381
                                        Tel. No.:  (281) 367-1666
                                        Fax No.:  (281) 367-1676
                                        Attention: Geoffrey Cox, Ph.D., CEO

With copies to:                         Andrews & Kurth L.L.P.
                                        2170 Buckthorne Place, Suite 150
                                        The Woodlands, Texas 77380
                                        Tel. No.:  (713) 220-4312
                                        Fax No.:  (713) 238-7282
                                        Attention: Jeffrey R. Harder

If to the Purchaser:                    Acqua Wellington North American
                                          Equities Fund, Ltd.
                                        c/o Fortis Fund Services (Bahamas) Ltd.
                                        Montague Sterling Centre
                                        East Bay Street, P. O. Box SS-6238
                                        Nassau, Bahamas
                                        Tel. No:  (242) 394-2700
                                        Fax No.:  (242) 394-9667
                                        Attention:  Anthony L.M. Inder Rieden

With copies to:                         Parker Chapin LLP
                                        The Chrysler Building
                                        405 Lexington Avenue
                                        New York, NY  10174
                                        Tel. No:  (212) 704-6000
                                        Fax No:  (212)704-6288
                                        Attention:  Christopher S. Auguste

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



                                      -26-
<PAGE>   30

                  SECTION 9.5 Waivers. No waiver by either party of any default
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provisions, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.

                  SECTION 9.6 Headings. The article, section and subsection
headings in this Agreement are for convenience only and shall not constitute a
part of this Agreement for any other purpose and shall not be deemed to limit or
affect any of the provisions hereof.

                  SECTION 9.7 Successors and Assigns. The Purchaser may not
assign this Agreement to any person without the prior consent of the Company,
which consent will not be unreasonably withheld. This Agreement shall be binding
upon and inure to the benefit of the parties and their successors and assigns.
The parties hereto may not amend this Agreement or any rights or obligations
hereunder without the prior written consent of the Company and each Purchaser to
be affected by the amendment. After Closing, the assignment by a party to this
Agreement of any rights hereunder shall not affect the obligations of such party
under this Agreement.

                  SECTION 9.8 Governing Law. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York,
without giving effect to the choice of law provisions.

                  SECTION 9.9 Survival. The representations and warranties of
the Company and the Purchaser contained in Article III and the covenants
contained in Article IV shall survive the execution and delivery hereof and the
Closing until the termination of this Agreement, and the agreements and
covenants set forth in Article VIII of this Agreement shall survive the
execution and delivery hereof and the Closing hereunder.

                  SECTION 9.10 Counterparts. This Agreement may be executed in
any number of counterparts, all of which taken together shall constitute one and
the same instrument and shall become effective when counterparts have been
signed by each party and delivered to the other parties hereto, it being
understood that all parties need not sign the same counterpart. In the event any
signature is delivered by facsimile transmission, the party using such means of
delivery shall cause four additional executed signature pages to be physically
delivered to the other parties within five days of the execution and delivery
hereof.

                  SECTION 9.11 Publicity. The Company shall not issue any press
release or otherwise make any public statement or announcement with respect to
this Agreement or the transactions contemplated hereby or the existence of this
Agreement without the prior written consent of the Purchaser, provided, however,
that in the event the Company is required by law or regulation to issue a press
release or otherwise make a public statement or announcement with respect to
this Agreement or the transaction contemplated hereby prior to or after the
Closing, the Company shall consult with the Purchaser on the form and substance
of such press release or other disclosure.



                                      -27-
<PAGE>   31

                  SECTION 9.12 Severability. The provisions of this Agreement
are severable and, in the event that any court of competent jurisdiction shall
determine that any one or more of the provisions or part of the provisions
contained in this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a provision of
this Agreement, and this Agreement shall be reformed and construed as if such
invalid or illegal or unenforceable provision, or part of such provision, had
never been contained herein, so that such provisions would be valid, legal and
enforceable to the maximum extent possible.

                  SECTION 9.13 Further Assurances. From and after the date of
this Agreement, upon the request of the Purchaser or the Company, each of the
Company and the Purchaser shall execute and deliver such instrument, documents
and other writings as may be reasonably necessary or desirable to confirm and
carry out and to effectuate fully the intent and purposes of this Agreement.







                                  [END OF PAGE]




                                      -28-
<PAGE>   32


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


                                 ARONEX PHARMACEUTICALS, INC.



                                 By: /s/ Geoffrey F. Cox, Ph.D.
                                    --------------------------
                                    Name:   Geoffrey F. Cox, Ph.D.
                                    Title:  Chairman of the Board and Chief
                                            Executive Officer


                                 ACQUA WELLINGTON NORTH
                                 AMERICAN EQUITIES FUND, LTD.



                                 By: /s/ Anthony L.M. Inder Rieden
                                    ------------------------------
                                    Name:   Anthony L.M. Inder Rieden
                                    Title:  Director


<PAGE>   33


         All Exhibits and Schedules to this Agreement have been omitted from
this filing.