Document:

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                                                                   EXHIBIT 4.20

THIS COMMON STOCK PURCHASE WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNDER ANY APPLICABLE LAW OR
REGULATION OF ANY STATE.  THIS COMMON STOCK WARRANT MAY NOT BE SOLD, OFFERED,
ASSIGNED OR TRANSFERRED UNLESS THE WARRANT IS REGISTERED UNDER THE SECURITIES
ACT AND APPLICABLE STATE SECURITIES LAWS, OR UNLESS SUCH OFFERS, SALES,
ASSIGNMENTS AND TRANSFERS ARE MADE PURSUANT TO THE AVAILABLE EXEMPTIONS FROM THE
REGISTRATION REQUIREMENTS OF THOSE LAWS.

                      DIAL-THRU INTERNATIONAL CORPORATION

                              AMENDED AND RESTATED
                         COMMON STOCK PURCHASE WARRANT
                                    (No. 2)

                                                           DATED:  March 1, 2000

--------------------------------------------------------------------------------
Number of Common Shares:      50,000                 Holder: Juan Carlos Gaviria
Purchase Price:               $.88
Expiration Date:              Two (2) years from date of vesting

               For identification only. The governing terms of
                       this Warrant are set forth below.
--------------------------------------------------------------------------------

     DIAL-THRU INTERNATIONAL CORPORATION, a Delaware corporation (the
"Company"), hereby certifies that, for value received, Juan Carlos Gaviria (the
"Holder") is entitled, subject to the terms set forth below, to purchase from
the Company at any time or from time to time prior to two (2) years following
the date of vesting of the Warrant at the Purchase Price hereinafter set forth,
Fifty Thousand (50,000) fully paid and nonassessable shares of Common Stock (as
defined below) of the Company.  This Warrant is being executed and delivered in
connection with the Distribution Agreement (as defined below), and modifies and
restates in its entirety the terms of the Common Stock Purchase Warrant dated
October 26, 1999 previously issued to LGIT, Inc.  The number and character of
such shares of Common Stock and the Purchase Price are subject to adjustment as
provided herein.

     The purchase price per share of Common Stock issuable upon exercise of
this Warrant (the "Purchase Price") shall initially be $.88, provided, however,
that the Purchase Price shall be adjusted from time to time as provided herein.

     As used herein the following terms, unless the context otherwise requires,
have the following respective meanings:

           (a)   The term "Company" means Dial-Thru International Corporation
     and any entity that shall succeed or assume the obligations of such
     corporation hereunder.

           (b)   The term "Common Stock" means the Company's common stock, .001
     par value per share.

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COMMON STOCK PURCHASE WARRANT - Page 1    (Dial-Thru International Corporation)
<PAGE>

           (c)   The term "Consolidated Revenues" means the combined revenues
     of the Distribution Group from the sales of the Company's prepaid phone
     cards.

           (d)   The term "Distribution Agreement " means the Distribution
     Agreement of even date herewith between the Company and Holder.

           (e)   The term "Distribution Group" means the following independent
     distributors of the Company's prepaid phone cards: Juan Carlos Gaviria,
     Alvaro Restrepo, Paul Saunier, Eric Ifflen, Emilio Martinez, Carlos Bedoya
     and Alfredo Polo.

           (f)   The term "Tax Withholding Liability" means all federal and
     state income taxes, social security taxes and other taxes applicable to
     compensation income arising from the exercise of this Warrant required by
     applicable law to be withheld by the Company.

           (g)   The term "Warrant Shares" means as of any date during the
     Exercise Period, that number of shares of Common Stock which shall be
     exercisable (subject to any vesting requirements) by the Holder hereof
     pursuant to the terms of this Warrant.

     1.    Vesting and Exercise of Warrant; Resale Restrictions.

           1.1.  Vesting. Holder's right to purchase 50% (25,000) of the Warrant
     Shares shall vest immediately upon the execution and delivery of this
     Warrant and shall be immediately exercisable. Holder's right to purchase
     the remaining 50% (25,000) Warrant Shares hereunder shall vest upon the
     Distributor Group's achieving Consolidated Revenues of in excess of $10
     million for a period of three consecutive calendar months on or before
     February 28, 2002. Holder shall not have any right to acquire any Warrant
     Shares pursuant to this Warrant prior to the vesting of such rights as set
     forth in this Section 1.1. If the Distributor Group fails to achieve
     Consolidated Revenues of in excess of $10 million in three consecutive
     calendar months prior to February 28, 2002, then Holder's right to acquire
     the remaining 25,000 Warrant Shares pursuant to the terms of this Warrant
     shall fail to vest and Holder shall have no right to acquire such shares
     hereunder.

           1.2.  Method of Exercise. This Warrant may be exercised (subject to
     the vesting requirements set forth above) by the Holder hereof in whole or
     in part (but not as to a fractional share of Common Stock), at any time and
     from time to time during the Exercise Period for up to, but not more than,
     the number of vested Warrant Shares at such time, by delivery to the
     Company at its principal office of (i) a notice of exercise (a "Notice of
     Exercise") substantially in the form attached hereto as Exhibit A, (ii)
     evidence satisfactory to the Company of the authority of the person
     executing such Notice of Exercise, (iii) this Warrant, and (iv) payment of
     (A) the Purchase Price multiplied by the number of shares of Common Stock
     for which this Warrant is being exercised (the "Exercise Price") and (B)
     Tax Withholding Liability. Payment of the Exercise Price and Tax
     Withholding Liability shall be made by check or bank draft payable to the
     order of
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AMENDED AND RESTATED
COMMON STOCK PURCHASE WARRANT - Page 2    (Dial-Thru International Corporation)
<PAGE>

     the Company or by wire transfer to the account of the Company. The shares
     so purchased shall be deemed to be issued as of the close of business on
     the date on which the Company shall have received from the Holder payment
     in full of the Exercise Price and Tax Withholding Liability and the other
     documents referred to herein (the "Exercise Date"). Notwithstanding the
     foregoing, Holder shall not be entitled to exercise this Warrant, in whole
     or in part, unless and until Holder is current in all payment obligations
     to the Company, whether arising under the Distribution Agreement or
     otherwise.

           1.3.  Regulation D Restrictions. The Holder hereof represents and
     warrants to the Company that it has acquired this Warrant and anticipates
     acquiring the shares of Common Stock issuable upon exercise of the Warrant
     solely for its own account for investment purposes and not with a view to
     or for distributing such securities unless such distribution has been
     registered with the Securities and Exchange Commission or an applicable
     exemption is available therefor. At the time this Warrant is exercised, the
     Company may require the Holder to state in the Notice of Exercise such
     representations concerning the Holder as are necessary or appropriate to
     assure compliance by the Holder with the Securities Act.

           1.4.  Resale Restrictions. The Holder hereof covenants and agrees
     with the Company that it will not, without the prior written consent of the
     Company, sell more than 5,000 shares per month during the two-year period
     following any exercise of this Warrant by Holder.

     2.    Delivery of Stock Certificates, etc., on Exercise. As soon as
practicable after the exercise of this Warrant, the Company will cause to be
issued in the name of and delivered to the Holder a certificate for the number
of fully paid and nonassessable shares of Common Stock to which the Holder shall
be entitled on such exercise, plus, in lieu of any fractional share to which the
Holder would otherwise be entitled, cash equal to such fraction multiplied by
the then applicable Purchase Price, together with any other stock or other
securities and property (including cash, where applicable) to which the Holder
is entitled upon such exercise pursuant to Section 1 or otherwise.

     3.    Adjustments on Certain Capital Transactions. On the occurrence of any
of the following events, the following adjustments to the rights granted under
this Warrant shall be made:

           3.1.  In case the number of outstanding shares of Common Stock of the
     Company shall be increased by way of a stock dividend, stock split,
     recapitalization, or other similar means, the number of unexercised shares
     of Common Stock covered by this Warrant shall be increased by the amount
     that a like number of shares of outstanding Common Stock shall have been
     increased as a result of such stock increase and the Purchase Price shall
     be adjusted by multiplying the Purchase Price in effect immediately prior
     to such stock increase by a fraction, the numerator of which shall be the
     number of unexercised shares covered by this Warrant immediately prior to
     such stock increase and the denominator of which shall be the number of
     unexercised shares of Common Stock covered by this Warrant as adjusted for
     such stock increase.

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AMENDED AND RESTATED
COMMON STOCK PURCHASE WARRANT - Page 3    (Dial-Thru International Corporation)
<PAGE>

           3.2.  In case the number of outstanding shares of Common Stock of the
     Company shall be reduced by recapitalization, reverse stock split or
     otherwise, the number of unexercised shares covered by this Warrant shall
     be reduced by the amount that a like number of shares of outstanding Common
     Stock shall have been reduced as a result of such stock reduction and the
     Purchase Price shall be adjusted by multiplying the Purchase Price in
     effect immediately prior to such stock reduction by a fraction, the
     numerator of which shall be the number of unexercised shares covered by
     this Warrant immediately prior to such stock reduction and the denominator
     of which shall be the number of unexercised shares covered by this Warrant
     as adjusted for such stock reduction.

           3.3.  In case the Company shall consolidate with or merge into
     another corporation, the holder of this Warrant will thereafter receive,
     upon the exercise thereof in accordance with the terms of this Warrant, the
     securities or property to which the holder of the number of shares of
     Common Stock then deliverable upon the exercise of this Warrant would have
     been entitled upon such consolidation or merger ("Other Securities") and
     the Company shall take such steps in connection with such consolidation or
     merger as may be necessary to assure that the provisions hereof shall
     thereafter be applicable, as nearly as reasonably may be, in relation to
     any securities or property thereafter deliverable upon the exercise of this
     Warrant.

     4.    Rights as a Shareholder. Holder shall not have any rights as a
shareholder of the Company with respect to the shares subject to this Warrant.

     5.    Securities Law Requirements. Neither this Warrant nor the Warrant
Shares have been registered under the Securities Act or any state securities or
blue sky laws. Accordingly, upon (a) any transfer of this Warrant, any
transferee of this Warrant or (b) the exercise of this Warrant in whole or in
part, and if the Warrant Shares have not been registered under the Securities
Act, Holder or any other person exercising this Warrant shall, as applicable,
represent and agree in writing satisfactory to the Company that Holder or such
other person (a) is acquiring the shares for the purpose of investment and not
with a view to distribution thereof, (b) knows the shares have not been
registered under the Securities Act or any state securities or blue sky laws,
(c) understands that he must bear the economic risk of said investment for an
indefinite period of time until the shares are registered under the Securities
Act and applicable state securities or blue sky laws or an exemption from such
registration is available, and (d) will not solicit any offer to sell or sell
all or any portion of the shares other than pursuant to an opinion of counsel
reasonably satisfactory to the Company.

     6.    Transfer Restrictions. This Warrant shall be exercisable only by
Holder and shall not be assignable or transferable. Any attempted alienation,
assignment, pledge, hypothecation, attachment, execution or similar process,
whether voluntary or involuntary, with respect to all or any part of this
Warrant or any right hereunder, shall be null and void.

     7.    Reservation of Stock, etc. Issuable on Exercise of Warrant. The
Company will at all times reserve and keep available, solely for issuance and
delivery on the exercise of this

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AMENDED AND RESTATED
COMMON STOCK PURCHASE WARRANT - Page 4    (Dial-Thru International Corporation)
<PAGE>

Warrant, all shares of Common Stock (or Other Securities) from time to time
issuable on the exercise of this Warrant.

     8.    Replacement of Warrant.  On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
Warrant, on delivery of an indemnity agreement or security satisfactory in form
and amount to the Company or, in the case of any such mutilation, on surrender
and cancellation of this Warrant, the Company at its expense will execute and
deliver, in lieu thereof, a new warrant of like tenor.

     9.    Notices, etc. All notices and other communications hereunder shall be
personally delivered, telecopied or mailed by first class registered or
certified mail, postage prepaid, at such address of facsimile numbers as may
have been furnished to each party by the other in writing.

     10.   Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant shall be construed and enforced in accordance with and
governed by the internal laws of the State of Texas. The headings in this
Warrant are for purposes of reference only, and shall not limit or otherwise
affect any of the terms hereof. The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability of any
other provision.

                           [SIGNATURE PAGE FOLLOWS]

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AMENDED AND RESTATED
COMMON STOCK PURCHASE WARRANT - Page 5    (Dial-Thru International Corporation)
<PAGE>

     DATED as of March 1, 2000

                                        DIAL-THRU INTERNATIONAL CORPORATION

                                        By:       /s/ Roger D. Bryant
                                           --------------------------------
                                        Name:     Roger D. Bryant
                                             ------------------------------
                                        Title:    Chairman
                                              -----------------------------

                                        Address:  8100 Jetstar, Suite 100
                                                  Irving, Texas  75063
                                                  Fax: (972) 929-1616

                                        HOLDER:
                                        ------

                                        /s/ Juan Carlos Gaviria
                                        -----------------------------------
                                        Printed Name: Juan Carlos Gaviria

                                        Address:
                                                   ------------------------

                                                   ------------------------
                                                   Fax:
                                                       --------------------

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AMENDED AND RESTATED
COMMON STOCK PURCHASE WARRANT - Page 6    (Dial-Thru International Corporation)
<PAGE>

                                   EXHIBIT A

                     FORM OF NOTICE OF EXERCISE - WARRANT
                     ------------------------------------

               (To be executed only upon exercise or conversion
                      of the Warrant in whole or in part)

To Dial-Thru International Corporation

     The undersigned registered holder of the accompanying Warrant hereby
exercises such Warrant or portion thereof for, and purchases thereunder,
___________/20/ shares of Common Stock (as defined in such Warrant) and herewith
makes payment therefor (including any Tax Withholding Liability) of $__________,
as of the date written below. The undersigned requests that the certificates for
such shares of Common Stock be issued in the name of, and delivered to,
_______________________________________________ whose address is
_____________________________________________________________________________.

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

                                        ---------------------------------------
                                        (Name must conform to name of Holder as
                                        specified on the face of the Warrant)

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

                                        Address of Holder:

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

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

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

Date of exercise:
                 ---------------------

--------------------------
/20/  Insert the number of shares of Common Stock as to which the accompanying
Warrant is being exercised. In the case of a partial exercise, a new Warrant or
Warrants will be issued and delivered, representing the unexercised portion of
the accompanying Warrant, to the holder surrendering the same.EXHIBIT A

                            6% CONVERTIBLE DEBENTURE

         NEITHER THESE  SECURITIES NOR THE SECURITIES  ISSUABLE UPON  CONVERSION
         HEREOF  HAVE BEEN  REGISTERED  WITH THE UNITED  STATES  SECURITIES  AND
         EXCHANGE COMMISSION OR THE SECURITIES  COMMISSION OF ANY STATE OR UNDER
         THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT").  THE SECURITIES ARE
         RESTRICTED  AND MAY NOT BE  OFFERED,  RESOLD,  PLEDGED  OR  TRANSFERRED
         EXCEPT AS PERMITTED UNDER THE ACT PURSUANT TO AN EFFECTIVE REGISTRATION
         STATEMENT OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS.

No. 1                                                             US $1,000,000

                           MEDISYS TECHNOLOGIES, INC.

                  6% CONVERTIBLE DEBENTURE DUE August 31, 2001

                  THIS  DEBENTURE  is issued by Medisys  Technologies,  Inc.,  a
corporation  organized  and  existing  under  the laws of the State of Utah (the
"Company")  and is  designated  as its 6%  Convertible  Debenture Due August 31,
2001.

                  FOR  VALUE  RECEIVED,  the  Company  promises  to pay to  AMRO
International,  S.A. or permitted  assigns (the "Holder"),  the principal sum of
One  Million  and  00/100 US Dollars  (US  $1,000,000)  on August 31,  2001 (the
"Maturity Date"), and to pay interest on the principal sum outstanding from time
to time  quarterly in arrears at the rate of 6% per annum accruing from the date
of initial  issuance.  Accrual of interest  shall commence on the first business
day to occur after the date of initial  issuance and continue  until  payment in
full of the principal sum has been made or duly provided for. Quarterly interest
payments shall be due and payable on July 1, October 1, January 1 and April 1 of
each year,  commencing  with April 1, 2000. If any interest  payment date or the
Maturity Date is not a business day in the State of New York,  then such payment
shall  be made  on the  next  succeeding  business  day.  The  interest  on this
Debenture  is  payable at the option of the  Holder,  in cash or in  registrable
shares of  Common  Stock of the  Company,  $.0005  par value per share  ("Common
Stock")  valued at the  Conversion  Price (as  defined  herein) on the  interest
payment  date, at the address last  appearing on the  Debenture  Register of the
Company as  designated  in writing by the Holder from time to time.  The Company
will pay the  principal  of and any  accrued but unpaid  interest  due upon this
Debenture on the Maturity Date, less any amounts required by law to be deducted,
to the  registered  holder  of this  Debenture  as of the tenth day prior to the
Maturity Date and addressed to such holder at the last address  appearing on the
Debenture  Register.  The forwarding of such check shall constitute a payment of
principal  and interest  hereunder and shall satisfy and discharge the liability
for  principal  and  interest  on  this  Debenture  to the  extent  of  the  sum
represented by such check plus any amounts so deducted.

                  This   Debenture  is  subject  to  the  following   additional
provisions:

                           1. The Company shall be entitled to withhold from all
payments of principal of, and interest on, this  Debenture any amounts  required
to be withheld under the  applicable  provisions of the United States income tax
laws or other  applicable  laws at the time of such  payments,  and Holder shall
execute and deliver all required documentation in connection therewith.

                                       1

<PAGE>

                           2.  This   Debenture  has  been  issued   subject  to
investment   representations  of  the  original  purchaser  hereof  and  may  be
transferred or exchanged only in compliance  with the Securities Act of 1933, as
amended (the "Act"), and other applicable state and foreign securities laws. The
Holder shall deliver  written notice to the Company of any proposed  transfer of
this Debenture.  In the event of any proposed  transfer of this  Debenture,  the
Company may  require,  prior to issuance of a new  Debenture in the name of such
other person, that it receive reasonable transfer documentation  including legal
opinions that the issuance of the Debenture in such other name does not and will
not cause a violation of the Act or any applicable  state or foreign  securities
laws.  Prior to due presentment for transfer of this Debenture,  the Company and
any agent of the  Company may treat the person in whose name this  Debenture  is
duly registered on the Company's  Debenture Register as the owner hereof for the
purpose of  receiving  payment as herein  provided  and for all other  purposes,
whether or not this  Debenture be overdue,  and neither the Company nor any such
agent shall be  affected  by notice to the  contrary.  This  Debenture  has been
executed  and  delivered  pursuant to the  Convertible  Debentures  and Warrants
Purchase  Agreement  dated as of February  23, 2000  between the Company and the
original Holder(s) (the "Purchase  Agreement"),  and is subject to the terms and
conditions of the Purchase Agreement, which are, by this reference, incorporated
herein and made a part hereof.  Capitalized terms used and not otherwise defined
herein  shall  have  the  meanings  set  forth  for such  terms in the  Purchase
Agreement.

                           3. The Holder of this  Debenture is entitled,  at its
option,  to convert at any time  commencing  on or after the 120th day after the
initial  issuance date,  the principal sum  outstanding of this Debenture or any
portion  thereof,  together  with  accrued but unpaid  interest,  into shares of
Common Stock of the Company ("Conversion Shares") at a conversion price for each
share of Common Stock ("Conversion  Price") equal to the lower of (a) 85% of the
Market  Price at the  Conversion  Date (as  defined  in Section 8 hereof) or (b)
$2.00.  The term "Market Price" shall have the meaning set forth in the Purchase
Agreement.

                           4. The Company shall have the right to deliver to the
Holder a written notice of the Company's intent to redeem the entire outstanding
principal  sum of this  Debenture  at a price equal to (i) during the sixty (60)
day period  following  the date of initial  issuance,  one hundred  five percent
(105%) of the principal  amount  outstanding and all accrued and unpaid interest
hereon,  (ii) on or after the 61st day after the date of initial issuance and up
to and including the 120th day after the date of initial  issuance,  one hundred
ten  percent  (110%) of the  principal  amount  outstanding  and all accrued and
unpaid  interest  hereon,  and (iii) on or after the 120th day after the date of
initial issuance and up to and including the 180th day after the date of initial
issuance,  one hundred and fifteen percent (115%) of the principal amount,  plus
all accrued but unpaid interest.  The Company shall make the redemption  payment
to the Holder within five (5) Trading Days of the  redemption  date set forth in
the Company notice of redemption,  or else the redemption  notice shall be void,
and the  Company  shall  thereafter  not have any  further  right to redeem this
Debenture.  The Holder  shall have the right to convert  this  Debenture  as set
forth in  Section  8 until the  Trading  Day  prior to the  Trading  Day set for
payment of the redemption price.

                           5.  Except  as set forth in the  Disclosure  Schedule
pursuant to Section 6.9 of the Purchase  Agreement,  if the Company  enters into
any equity  financing  arrangement  prior to repayment or  conversion in full of
this Debenture, the Company shall be obligated to use fifty percent (50%) of the
proceeds  of any such  equity  financing  to redeem  as much of the  outstanding
principal sum of this Debenture as the equity  financing  provides in accordance
with the  terms of this  Section  5, at a price  according  to the  schedule  in
Section 4 of this Debenture.

                                       2

<PAGE>

                           6. Notwithstanding anything to the contrary contained
herein and only if the rules of the Principal Market will be violated otherwise,
in the event that a conversion  (when  aggregated with all prior  conversions of
portions of this Debenture)  requires the Company to issue a number of shares of
Common  Stock which would  exceed  19.9% of the number of shares of Common Stock
issued and  outstanding on the date of this  Debenture,  the Company shall issue
only such  number of shares of Common  Stock as shall not exceed  such limit and
shall pay the  Holder  cash in the  amount  of the  closing  asked  price on the
Principal  Market on the  Conversion  Date  times the number of shares of Common
Stock in excess of such  number of shares  into  which  this  Debenture  (or the
portion  thereof then being  converted) is then  convertible  at the  Conversion
Price. Any payments under this Section 6 shall be made to an account  designated
in writing by the Holder to the Company when the Notice of  Conversion is given.
The rights of all holders of  Convertible  Debentures  issued under the Purchase
Agreement to convert their  Convertible  Debentures  into shares of Common Stock
shall be  prorated  among  such  holders  based on their  respective  percentage
holdings at the time of conversion of the  aggregate  outstanding  amount of all
Convertible Debentures in order to comply with the aforesaid overall limitation.
Any  conversion  which is paid in cash under this Section 6 shall be paid within
five  (5)  Trading  Days of the  Conversion  Date,  or else  the  Company  shall
thereafter  be unable to exercise its  redemption  rights  under  Section 4 with
respect to the outstanding Debentures.

                           7. On any  Conversion  Date, the Company may elect to
deliver to the Holder in consideration  of any such conversion cash,  Conversion
Shares or any  combination  thereof.  The amount of cash to be  delivered  shall
equal the closing ask price on the Conversion  Date  multiplied by the number of
shares of Common  Stock as would have been issued at the  Conversion  Price upon
such  conversion.  The  Company's  ability  to  deliver  cash as full or partial
conversion  consideration in accordance with this Section 7 shall be conditioned
on the  Company's  delivery  of notice to the  Holder  of such  election  by the
Company no later than six (6) business hours following the Company's  receipt of
a Notice of Conversion.  The Holder shall then have a further  twenty-four  (24)
hour period in which to withdraw  his Notice of  Conversion,  or else the Holder
shall be deemed to have accepted such  alternative cash  consideration  and such
sum shall be due and payable within five (5) Trading Days.

                           8.   (a)   Conversion   shall   be   effectuated   by
surrendering  this Debenture to the Company (if such Conversion will convert all
outstanding  principal)  together  with the form of conversion  notice  attached
hereto as Exhibit A (the "Notice of Conversion"), executed by the Holder of this
Debenture  evidencing  such  Holder's  intention to convert this  Debenture or a
specified  portion (as above provided) hereof,  and accompanied,  if required by
the Company, by proper assignment hereof in blank.  Interest accrued or accruing
from the date of issuance to the date of conversion  shall, at the option of the
Company,  be paid in cash as set forth above or in Common Stock upon  conversion
at the Conversion  Price on the Conversion Date. No fraction of a share or scrip
representing a fraction of a share will be issued on conversion,  but the number
of shares  issuable  shall be rounded to the nearest  whole  share.  The date on
which Notice of Conversion is given (the  "Conversion  Date") shall be deemed to
be the date on which the Holder faxes the Notice of Conversion  duly executed to
the Company. Facsimile delivery of the Notice of Conversion shall be accepted by
the Company at facsimile  number:  (225)  343-8023 Attn:  Edward P.  Sutherland.
Certificates  representing Common Stock upon conversion will be delivered to the
Holder  within five (5) Trading Days from the date the Notice of  Conversion  is
delivered to the Company.  Delivery of shares upon  conversion  shall be made to
the address specified by the Holder in the Notice of Conversion.

                           (b)  The  Company  understands  that a  delay  in the
issuance of shares of Common Stock upon a conversion beyond the five (5) Trading
Day period  described  in  Section  8(a) could  result in  economic  loss to the
Holder.  As  compensation to the Holder for such loss, the Company agrees to pay
late  payments to the Holder for late  issuance  of shares of Common  Stock upon
conversion in accordance with the following  schedule  (where "No.  Trading Days
Late" is defined as the number of Trading Days beyond five (5) Trading Days from
the date the Notice of Conversion is delivered to the Company).

                                       3

<PAGE>

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 o. Trading Days Late                        Late Payment for Each
                                           $5,000 of Principal Amount
                                                Being Converted

-------------------------------------------------------------------------------
          1                                           $100
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          2                                           $200
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          3                                           $300
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          4                                           $400
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          5                                           $500
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          6                                           $600
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          7                                           $700
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          8                                           $800
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          9                                           $900
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         10                                          $1,000
-------------------------------------------------------------------------------
    More than 10                       $1,000 +$200 for each Trading Day
                                          Late beyond 10 Trading Days
-------------------------------------------------------------------------------

                           The Company  shall pay any  payments  incurred  under
this Section 8(b) in  immediately  available  funds upon demand.  Nothing herein
shall limit Holder's right to pursue injunctive relief and/or actual damages for
the  Company's  failure  to  issue  and  deliver  Common  Stock  to the  holder,
including,  without  limitation,  the Holder's  actual losses  occasioned by any
"buy-in" of Common Stock  necessitated  by such late delivery.  Furthermore,  in
addition to any other  remedies  which may be  available  to the Holder,  in the
event that the Company fails for any reason to effect delivery of such shares of
Common Stock within five (5) Trading Days from the date the Notice of Conversion
is delivered to the Company,  the Holder will be entitled to revoke the relevant
Notice of  Conversion  by  delivering  a notice to such  effect to the  Company,
whereupon the Company and the Holder shall each be restored to their  respective
positions  immediately  prior to delivery of such Notice of  Conversion,  and in
such  event no late  payments  shall be due in  connection  with such  withdrawn
conversion.

                           (c) If (a) the Company challenges, disputes or denies
the right of the Holder to effect the  conversion of this  Debenture into Common
Stock or otherwise  dishonors or rejects any Notice of  Conversion  delivered in
accordance with this Section 8 or (b) any Company stockholder who is not and has
never been an  Affiliate  (as  defined in Rule 405 under the  Securities  Act of
1933, as amended) of the Holder obtains a judgment or any injunctive relief from
any court or public or  governmental  authority which denies,  enjoins,  limits,
modifies,  delays or  disputes  the  right of the  holder  hereof to effect  the
conversion of this Debenture  into Common Stock,  then the Holder shall have the
right,  by written  notice,  to require  the  Company to  promptly  redeem  this
Debenture  for cash at a  redemption  price equal to one hundred  forty  percent
(140%).  Under any of the  circumstances  set forth above,  the Company shall be
responsible  for the payment of all costs and expenses of the Holder,  including
reasonable  legal fees and expenses,  as and when incurred in disputing any such
action or pursuing its rights  hereunder (in addition to any other rights of the
Holder), subject in the case of clause (b) to the Company's right to control and
assume  the  defense  of any  such  action.  In  the  absence  of an  injunction
precluding  the same,  the Company  shall issue  shares upon a properly  noticed
conversion.

                           (d) The Holder  shall be  entitled  to  exercise  its
conversion  privilege  notwithstanding  the  commencement  of any case  under 11
U.S.C.ss.  101 et seq. (the  "Bankruptcy  Code").  In the event the Company is a
debtor  under the  Bankruptcy  Code,  the Company  hereby  waives to the fullest
extent  permitted  any  rights to relief it may have  under 11  U.S.C.ss.362  in
respect of the Holder's conversion privilege.

                                       4

<PAGE>

                           9. No  provision  of this  Debenture  shall  alter or
impair the obligation of the Company,  which is absolute and  unconditional,  to
pay the principal of, and interest on, this  Debenture at the time,  place,  and
rate, and in the coin or currency or shares of Common Stock,  herein prescribed.
This Debenture is a direct obligation of the Company.

                           10. No  recourse  shall be had for the payment of the
principal of, or the interest on, this Debenture, or for any claim based hereon,
or otherwise in respect hereof, against any incorporator, shareholder, employee,
officer or director,  as such,  past,  present or future,  of the Company or any
successor corporation, whether by virtue of any constitution, statute or rule of
law, or by the  enforcement of any assessment or penalty or otherwise,  all such
liability being, by the acceptance  hereof and as part of the  consideration for
the issue hereof, expressly waived and released.

                           11.  If  the  Company  merges  or  consolidates  with
another corporation or sells or transfers all or substantially all of its assets
to another  person and the holders of the Common  Stock are  entitled to receive
stock,  securities  or property in respect of or in exchange  for Common  Stock,
then as a condition of such merger, consolidation, sale or transfer, the Company
and any such  successor,  purchaser or  transferee  agree that the Debenture may
thereafter  be  converted on the terms and subject to the  conditions  set forth
above into the kind and amount of stock,  securities or property receivable upon
such merger, consolidation, sale or transfer by a holder of the number of shares
of Common Stock into which this Debenture might have been converted  immediately
before such  merger,  consolidation,  sale or transfer,  subject to  adjustments
which shall be as nearly  equivalent as may be practicable.  In the event of any
proposed merger,  consolidation or sale or transfer of all or substantially  all
of the assets of the Company (a "Sale"),  the Holder hereof shall have the right
to convert by delivering a Notice of Conversion  to the Company  within  fifteen
(15) days of receipt of notice of such Sale from the  Company.  In the event the
Holder hereof shall elect not to convert, the Company may prepay all outstanding
principal and accrued  interest on this Debenture as provided in Section 4, less
all  amounts  required  by law to be  deducted,  upon  which  tender of  payment
following such notice, the right of conversion shall terminate.

                           12.  The  Holder  of  the  Debenture,  by  acceptance
hereof,  agrees that this  Debenture is being  acquired for  investment and that
such Holder will not offer,  sell or otherwise  dispose of this Debenture or the
Shares  of  Common  Stock   issuable  upon   conversion   thereof  except  under
circumstances  which will not result in a violation of the Act or any applicable
state  Blue  Sky or  foreign  laws  or  similar  laws  relating  to the  sale of
securities.

                           13. This Debenture shall be governed by and construed
in  accordance  with the  laws of the  State of New  York.  Each of the  parties
consents to the jurisdiction of the federal courts whose districts encompass any
part of the  City of New  York or the  state  courts  of the  State  of New York
sitting in the City of New York in  connection  with any dispute  arising  under
this  Agreement and hereby waives,  to the maximum extent  permitted by law, any
objection,  including  any  objection  based on  forum  non  conveniens,  to the
bringing of any such proceeding in such jurisdictions.

                           14.  The  following  shall  constitute  an  "Event of
                           Default":

                           a.  The  Company  shall  default  in the  payment  of
                           principal  or  interest  on this  Debenture  and same
                           shall  continue for a period of ten (10) days;  or

                           b. Any of the  representations  or warranties made by
                           the Company herein,  in the Purchase  Agreement,  the
                           Registration  Rights Agreement,  or in any agreement,
                           certificate or financial or other written  statements
                           heretofore  or hereafter  furnished by the Company in
                           connection  with the  execution  and delivery of this
                           Debenture or the Purchase Agreement shall be false or
                           misleading in any material  respect at the time made;
                           or

                                       5

<PAGE>

                           c. The Company  fails to issue shares of Common Stock
                           to the Holder or to cause its Transfer Agent to issue
                           shares of Common Stock upon exercise by the Holder of
                           the  conversion  rights of the  Holder in  accordance
                           with the terms of this  Debenture,  fails to transfer
                           or to  cause  its  Transfer  Agent  to  transfer  any
                           certificate  for shares of Common Stock issued to the
                           Holder upon  conversion of this Debenture as and when
                           required by this Debenture or the Registration Rights
                           Agreement,  and such transfer is otherwise lawful, or
                           fails to remove  any  restrictive  legend or to cause
                           its Transfer Agent to transfer any certificate or any
                           shares of Common  Stock  issued  to the  Holder  upon
                           conversion of this  Debenture as and when required by
                           this  Debenture,   the  Purchase   Agreement  or  the
                           Registration Rights Agreement and such legend removal
                           is  otherwise  lawful,  and any  such  failure  shall
                           continue uncured for five (5) business days; or

                           d. The Company  shall fail to perform or observe,  in
                           any  material  respect,  any  other  covenant,  term,
                           provision,  condition, agreement or obligation of the
                           Company   under   the   Purchase    Agreement,    the
                           Registration  Rights  Agreement or this Debenture and
                           such failure shall  continue  uncured for a period of
                           thirty (30) days after written notice from the Holder
                           of such failure; or

                           e.  The  Company  shall  (1)  admit  in  writing  its
                           inability to pay its debts  generally as they mature;
                           (2) make an  assignment  for the benefit of creditors
                           or commence  proceedings for its dissolution;  or (3)
                           apply for or consent to the appointment of a trustee,
                           liquidator  or receiver for its or for a  substantial
                           part of its property or business; or

                           f.  A  trustee,   liquidator  or  receiver  shall  be
                           appointed for the Company or for a  substantial  part
                           of its  property or business  without its consent and
                           shall not be discharged  within sixty (60) days after
                           such appointment; or

                           g. Any governmental  agency or any court of competent
                           jurisdiction  at the  instance  of  any  governmental
                           agency shall  assume  custody or control of the whole
                           or  any  substantial  portion  of the  properties  or
                           assets of the  Company  and  shall  not be  dismissed
                           within sixty (60) days thereafter; or

                           h. Any money judgment, writ or warrant of attachment,
                           or similar process in excess of Five Hundred Thousand
                           ($500,000)  Dollars in the aggregate shall be entered
                           or filed against the Company or any of its properties
                           or other assets and shall remain  unpaid,  unvacated,
                           unbonded or unstayed  for a period of sixty (60) days
                           or in any event later than five (5) days prior to the
                           date of any proposed sale thereunder; or

                           i.   Bankruptcy,   reorganization,    insolvency   or
                           liquidation  proceedings  or  other  proceedings  for
                           relief  under any  bankruptcy  law or any law for the
                           relief of debtors  shall be  instituted by or against
                           the Company and, if  instituted  against the Company,
                           shall not be  dismissed  within sixty (60) days after
                           such  institution  or the Company shall by any action
                           or answer approve of, consent to, or acquiesce in any
                           such  proceedings  or admit the material  allegations
                           of, or default in  answering a petition  filed in any
                           such proceeding; or

                                       6

<PAGE>

                           j. The Company shall have its Common Stock  suspended
                           or delisted from trading on a Principal Market for in
                           excess of two (2) Trading Days;

Then, or at any time  thereafter,  and in each and every such case,  unless such
Event of Default  shall have been waived in writing by the Holder  (which waiver
shall not be deemed to be a waiver of any  subsequent  default) at the option of
the Holder and in the Holder's  sole  discretion,  the Holder may consider  this
Debenture immediately due and payable,  without presentment,  demand, protest or
notice of any kind, all of which are hereby expressly waived, anything herein or
in any note or other instruments contained to the contrary notwithstanding,  and
the  Holder  may  immediately  enforce  any and all of the  Holder's  rights and
remedies  provided  herein or any  other  rights or  remedies  afforded  by law;
provided,  that any payment of this  Debenture  in  connection  with an Event of
Default (other than a delisting of its Common Stock pursuant to clause (j.)) may
be made, at the  Company's  election,  in cash or in shares of Common Stock,  in
such number as would be issued at the Conversion Price on the date the Debenture
becomes due and payable.

                  15. Nothing  contained in this Debenture shall be construed as
conferring  upon the  Holder  the right to vote or to  receive  dividends  or to
consent  or  receive  notice as a  shareholder  in  respect  of any  meeting  of
shareholders  or any rights  whatsoever as a shareholder of the Company,  unless
and to the extent converted in accordance with the terms hereof.

                  16. In no event shall the Holder be  permitted to convert this
Debenture  for shares of Common Stock in excess of the amount of this  Debenture
upon the conversion of which,  (x) the number of shares of Common Stock owned by
such Holder (other than shares of Common Stock issuable upon  conversion of this
Debenture)  plus  (y) the  number  of  shares  of  Common  Stock  issuable  upon
conversion of this Debenture,  would be equal to or exceed 9.9% of the number of
shares of Common Stock then issued and  outstanding,  including  shares issuable
upon conversion of this Debenture held by such Holder after  application of this
Section  16.  As used  herein,  beneficial  ownership  shall  be  determined  in
accordance  with  Section  13(d) of the  Securities  Exchange  Act of  1934,  as
amended,  and the rules  and  regulations  thereunder.  To the  extent  that the
limitation  contained in this Section 16 applies,  the  determination of whether
this  Debenture is  convertible  (in relation to other  securities  owned by the
Holder) and of which a portion of this Debenture is convertible  shall be in the
sole  discretion  of such Holder,  and the  submission of a Notice of Conversion
shall be deemed to be such Holder's  determination  of whether this Debenture is
convertible (in relation to other  securities owned by such holder) and of which
portion of this Debenture is convertible, in each case subject to such aggregate
percentage  limitation,  and the Company  shall have no  obligation to verify or
confirm the accuracy of such  determination.  Nothing  contained herein shall be
deemed to restrict the right of a holder to convert this  Debenture  into shares
of Common Stock at such time as such  conversion will not violate the provisions
of this  Section  16.  The  provisions  of this  Section 16 may be waived by the
Holder  of this  Debenture  upon not  less  than 75 days'  prior  notice  to the
Company,  and the  provisions  of this Section 16 shall  continue to apply until
such 75th day (or such later date as may be specified in such notice of waiver).
No conversion of this Debenture in violation of this Section 16 but otherwise in
accordance  with this  Debenture  shall  affect the  status of the Common  Stock
issued upon such  conversion as validly  issued,  fully-paid and  nonassessable.
Notwithstanding  anything  contained  herein to the contrary,  no interest shall
accrue  after  the  Maturity  Date  on any  such  unconverted  portion  of  this
Debenture.

                                       7

<PAGE>

                  IN WITNESS WHEREOF,  the Company has caused this instrument to
be duly executed by an officer thereunto duly authorized.

Dated:   February __, 2000

                                       MEDISYS TECHNOLOGIES, INC.

                                       By:
                                       Edward P. Sutherland, Chairman and CEO

Attest:
-----------------------

                                       8

<PAGE>

                                                     EXHIBIT A

                                               NOTICE OF CONVERSION

   (To be Executed by the Registered Holder in order to Convert the Debenture)

           The undersigned  hereby  irrevocably elects to convert $______ of the
principal  amount of the above  Debenture  No.__into  Shares of Common  Stock of
Medisys  Technologies,  Inc. (the "Company") according to the conditions hereof,
as of the date written below.

Date of Conversion* ____________________________________________________________

Applicable Conversion Price * _________________________________________________

Accrued Interest________________________________________________________________

Signature_____________________________________________________________________
                                     [Name]

Address:______________________________________________________________________

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

* This  original  Notice of  Conversion  must be  received by the Company by the
third  Trading Day  following the Date of  Conversion,  and, if such  conversion
represents  the  remaining  principal  balance of the  Debenture,  the  original
Debenture.

                                       9

<PAGE>

                                                                      EXHIBIT B

NEITHER  THIS WARRANT NOR THE SHARES  ISSUABLE  UPON  EXERCISE  HEREOF HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE  "SECURITIES  ACT")
OR ANY OTHER  APPLICABLE  SECURITIES LAWS IN RELIANCE UPON AN EXEMPTION FROM THE
REGISTRATION  REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS.
NEITHER THIS WARRANT NOR THE SHARES  ISSUABLE UPON EXERCISE  HEREOF MAY BE SOLD,
PLEDGED, TRANSFERRED,  ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE SECURITIES ACT OR IN A TRANSACTION
WHICH IS EXEMPT FROM REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT.

                             STOCK PURCHASE WARRANT

                  To Purchase 75,000 Shares of Common Stock of

                           MEDISYS TECHNOLOGIES, INC.

         THIS CERTIFIES  that,  for value  received,  Jesup & Lamont  Securities
Corp. (the "Holder"),  is entitled, upon the terms and subject to the conditions
hereinafter  set forth,  at any time on or after February 23, 2000 (the "Initial
Exercise  Date") and on or prior to the close of business  on February  23, 2003
(the "Termination Date") but not thereafter,  to subscribe for and purchase from
Medisys Technologies,  Inc., a corporation incorporated in Utah (the "Company"),
up to seventy-five  thousand  (75,000)  shares (the "Warrant  Shares") of Common
Stock, $.0005 par value, of the Company (the "Common Stock"). The purchase price
of one share of Common Stock (the "Exercise  Price") under this Warrant shall be
$2.00,  pursuant to the Convertible  Debentures and Warrants Purchase  Agreement
dated as of  February  23, 2000  pursuant to which this  Warrant has been issued
(the  "Purchase  Agreement").  The  Exercise  Price and the number of shares for
which the  Warrant is  exercisable  shall be subject to  adjustment  as provided
herein.  In the event of any conflict  between the terms of this Warrant and the
Purchase Agreement, the Purchase Agreement shall control. Capitalized terms used
and not  otherwise  defined  herein  shall have the  meanings set forth for such
terms in the Purchase Agreement.

                                       1

<PAGE>

1. Title to Warrant.  Prior to the  Termination  Date and subject to  compliance
with applicable laws, this Warrant and all rights hereunder are transferable, in
whole or in part, at the office or agency of the Company by the holder hereof in
person or by duly authorized  attorney,  upon surrender of this Warrant together
with the Assignment Form annexed hereto properly endorsed.

2.  Authorization  of Shares.  The Company  covenants  that all shares of Common
Stock  which may be issued  upon the  exercise  of  rights  represented  by this
Warrant will, upon exercise of the rights  represented by this Warrant,  be duly
authorized,  validly  issued,  fully  paid and  nonassessable  and free from all
taxes,  liens and charges in respect of the issue  thereof  (other than taxes in
respect of any transfer occurring contemporaneously with such issue).

3. Exercise of Warrant.  Except as provided in Section 4 herein, exercise of the
purchase rights  represented by this Warrant may be made at any time or times on
or after the  Initial  Exercise  Date,  and before the close of  business on the
Termination  Date by the  surrender  of this  Warrant and the Notice of Exercise
Form annexed hereto duly  executed,  at the office of the Company (or such other
office or agency of the Company as it may  designate by notice in writing to the
registered holder hereof at the address of such holder appearing on the books of
the  Company)  and upon  payment of the  Exercise  Price of the  shares  thereby
purchased by wire transfer or cashier's check drawn on a United States bank, the
holder of this Warrant shall be entitled to receive a certificate for the number
of  shares of Common  Stock so  purchased.  Certificates  for  shares  purchased
hereunder  shall be delivered to the holder  hereof within five (5) Trading Days
after the date on which this Warrant  shall have been  exercised  as  aforesaid.
This Warrant  shall be deemed to have been  exercised  and such  certificate  or
certificates shall be deemed to have been issued, and Holder or any other person
so  designated  to be named  therein  shall be deemed to have become a holder of
record of such  shares for all  purposes,  as of the date the  Warrant  has been
exercised by payment to the Company of the Exercise Price and all taxes required
to be paid by Holder,  if any,  pursuant  to Section 5 prior to the  issuance of
such shares,  have been paid. If this Warrant shall have been exercised in part,
the Company shall,  at the time of delivery of the  certificate or  certificates
representing  Warrant  Shares,  deliver to Holder a new Warrant  evidencing  the
rights of Holder to purchase the  unpurchased  shares of Common Stock called for
by this Warrant, which new Warrant shall in all other respects be identical with
this Warrant. If there is no registration in effect permitting the resale by the
Holder  of the  Warrant  Shares  at any time  from and  after  one year from the
issuance  date of this  Warrant,  then the  Holder  shall  have  the  right to a
"cashless  exercise"  in  which  the  Holder  shall be  entitled  to  receive  a
certificate for the number of shares equal to the quotient  obtained by dividing
[(A-B) (X)] by (A), where:

(A) = the average of the high and low trading  prices per share of Common  Stock
on the Trading Day preceding the date of such election;

(B) =  the Exercise Price of the Warrant; and

                                       2

<PAGE>

(X) = the number of shares  issuable  upon exercise of the Warrant in accordance
with the terms of this Warrant.

4. No Fractional  Shares or Scrip.  No fractional  shares or scrip  representing
fractional  shares shall be issued upon the exercise of this Warrant.  As to any
fraction of a share which  Holder would  otherwise be entitled to purchase  upon
such exercise,  the Company shall pay a cash adjustment in respect of such final
fraction in an amount equal to the Exercise Price.

5. Charges,  Taxes and Expenses.  Issuance of certificates  for shares of Common
Stock upon the  exercise of this  Warrant  shall be made  without  charge to the
holder  hereof  for any issue or  transfer  tax or other  incidental  expense in
respect of the  issuance of such  certificate,  all of which taxes and  expenses
shall be paid by the Company,  and such certificates shall be issued in the name
of the holder of this Warrant or in such name or names as may be directed by the
holder of this Warrant;  provided,  however,  that in the event certificates for
shares of Common  Stock  are to be issued in a name  other  than the name of the
holder of this  Warrant,  this Warrant when  surrendered  for exercise  shall be
accompanied by the Assignment  Form attached  hereto duly executed by the holder
hereof; and the Company may require,  as a condition  thereto,  the payment of a
sum sufficient to reimburse it for any transfer tax incidental thereto.

6. Closing of Books. The Company will not close its shareholder books or records
in any manner which prevents the timely exercise of this Warrant.

7.  Transfer,  Division  and  Combination.  (a) Subject to  compliance  with any
applicable  securities laws,  transfer of this Warrant and all rights hereunder,
in whole or in part,  shall be  registered  on the  books of the  Company  to be
maintained  for such  purpose,  upon  surrender of this Warrant at the principal
office of the  Company,  together  with a  written  assignment  of this  Warrant
substantially  in the form attached  hereto duly executed by Holder or its agent
or attorney  and funds  sufficient  to pay any transfer  taxes  payable upon the
making of such transfer. Upon such surrender and, if required, such payment, the
Company  shall  execute and deliver a new Warrant or Warrants in the name of the
assignee or assignees and in the denomination or denominations specified in such
instrument  of  assignment,  and  shall  issue  to the  assignor  a new  Warrant
evidencing  the portion of this Warrant not so assigned,  and this Warrant shall
promptly be cancelled.  A Warrant,  if properly assigned,  may be exercised by a
new holder  for the  purchase  of shares of Common  Stock  without  having a new
Warrant issued.

                           (b) This  Warrant  may be  divided or  combined  with
other Warrants upon presentation  hereof at the aforesaid office of the Company,
together with a written notice  specifying the names and  denominations in which
new  Warrants  are to be  issued,  signed by  Holder  or its agent or  attorney.
Subject  to  compliance  with  Section  7(a),  as to any  transfer  which may be
involved in such division or combination,  the Company shall execute and deliver
a new Warrant or Warrants in exchange  for the Warrant or Warrants to be divided
or combined in accordance with such notice.

                                       3

<PAGE>

                           (c) The Company shall  prepare,  issue and deliver at
its own expense  (other than transfer  taxes) the new Warrant or Warrants  under
this Section 7.

                           (d) The Company agrees to maintain,  at its aforesaid
office,  books for the  registration  and the  registration  of  transfer of the
Warrants.

8. No Rights as Shareholder  until  Exercise.  This Warrant does not entitle the
holder  hereof to any  voting  rights or other  rights as a  shareholder  of the
Company prior to the exercise hereof. Upon the surrender of this Warrant and the
payment of the aggregate  Exercise Price,  the Warrant Shares so purchased shall
be and be deemed to be issued to such holder as the record  owner of such shares
as of the  close of  business  on the  later of the  date of such  surrender  or
payment.

9. Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that
upon  receipt by the Company of evidence  reasonably  satisfactory  to it of the
loss, theft,  destruction or mutilation of this Warrant certificate or any stock
certificate  relating  to the  Warrant  Shares,  and in case of  loss,  theft or
destruction, of indemnity or security reasonably satisfactory to it (which shall
not include the posting of any bond),  and upon  surrender and  cancellation  of
such  Warrant or stock  certificate,  if  mutilated,  the Company  will make and
deliver a new  Warrant or stock  certificate  of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.

10.  Saturdays,  Sundays,  Holidays,  etc. If the last or appointed  day for the
taking of any action or the  expiration of any right  required or granted herein
shall be a Saturday, Sunday or a legal holiday, then such action may be taken or
such right may be exercised on the next succeeding day not a Saturday, Sunday or
legal holiday.

11.  Adjustments  of  Exercise  Price and  Number of Warrant  Shares.  (a) Stock
Splits, etc. The number and kind of securities  purchasable upon the exercise of
this Warrant and the Exercise Price shall be subject to adjustment  from time to
time upon the happening of any of the  following.  In case the Company shall (i)
pay a dividend  in shares of Common  Stock or make a  distribution  in shares of
Common Stock to holders of its  outstanding  Common  Stock,  (ii)  subdivide its
outstanding  shares of Common  Stock  into a greater  number of shares of Common
Stock,  (iii)  combine  its  outstanding  shares of Common  Stock into a smaller
number of shares of Common  Stock or (iv) issue any shares of its capital  stock
in a  reclassification  of the Common Stock,  then the number of Warrant  Shares
purchasable  upon  exercise of this Warrant  immediately  prior thereto shall be
adjusted  so that the holder of this  Warrant  shall be  entitled to receive the
kind and number of Warrant  Shares or other  securities  of the Company which he
would  have  owned or have  been  entitled  to  receive  had such  Warrant  been
exercised in advance  thereof.  Upon each such adjustment of the kind and number
of Warrant  Shares or other  securities  of the  Company  which are  purchasable
hereunder,  the holder of this Warrant shall  thereafter be entitled to purchase
the number of Warrant Shares or other securities  resulting from such adjustment
at an Exercise Price per Warrant Share or other security obtained by multiplying
the Exercise Price in effect  immediately prior to such adjustment by the number
of  Warrant  Shares  purchasable  pursuant  hereto  immediately  prior  to  such
adjustment and dividing by the number of Warrant  Shares or other  securities of
the Company resulting from such adjustment.  An adjustment made pursuant to this
paragraph shall become  effective  immediately  after the effective date of such
event retroactive to the record date, if any, for such event.

                                       4

<PAGE>

                           (b)   Reorganization,    Reclassification,    Merger,
Consolidation or Disposition of Assets. In case the Company shall reorganize its
capital, reclassify its capital stock, consolidate or merge with or into another
corporation  (where the Company is not the surviving  corporation or where there
is a change in or distribution with respect to the Common Stock of the Company),
or sell, transfer or otherwise dispose of all or substantially all its property,
assets or business  to another  corporation  and,  pursuant to the terms of such
reorganization,   reclassification,  merger,  consolidation  or  disposition  of
assets, shares of common stock of the successor or acquiring corporation, or any
cash,  shares of stock or other securities or property of any nature  whatsoever
(including  warrants or other subscription or purchase rights) in addition to or
in lieu of  common  stock of the  successor  or  acquiring  corporation  ("Other
Property"),  are to be received by or distributed to the holders of Common Stock
of the Company,  then Holder shall have the right  thereafter  to receive,  upon
exercise of this Warrant,  the number of shares of common stock of the successor
or acquiring corporation or of the Company, if it is the surviving  corporation,
and  Other  Property  receivable  upon or as a  result  of such  reorganization,
reclassification,  merger, consolidation or disposition of assets by a holder of
the  number of shares of Common  Stock for which  this  Warrant  is  exercisable
immediately   prior  to  such  event.  In  case  of  any  such   reorganization,
reclassification,  merger, consolidation or disposition of assets, the successor
or acquiring  corporation (if other than the Company) shall expressly assume the
due and  punctual  observance  and  performance  of each and every  covenant and
condition of this  Warrant to be  performed  and observed by the Company and all
the obligations and liabilities hereunder,  subject to such modifications as may
be deemed appropriate (as determined in good faith by resolution of the Board of
Directors  of the  Company)  in order to provide  for  adjustments  of shares of
Common  Stock for which this  Warrant is  exercisable  which  shall be as nearly
equivalent as  practicable to the  adjustments  provided for in this Section 11.
For purposes of this  Section 11,  "common  stock of the  successor or acquiring
corporation"  shall include stock of such  corporation of any class which is not
preferred  as to  dividends  or  assets  over any  other  class of stock of such
corporation  and which is not subject to  redemption  and shall also include any
evidences  of  indebtedness,  shares  of  stock or other  securities  which  are
convertible into or exchangeable for any such stock,  either immediately or upon
the arrival of a specified  date or the  happening of a specified  event and any
warrants  or other  rights to  subscribe  for or purchase  any such  stock.  The
foregoing  provisions  of this Section 11 shall  similarly  apply to  successive
reorganizations,  reclassifications,  mergers,  consolidations or disposition of
assets.

12. Voluntary  Adjustment by the Company. The Company may at any time during the
term of this Warrant,  reduce the then current  Exercise Price to any amount and
for any  period of time  deemed  appropriate  by the Board of  Directors  of the
Company.

13.  Notice of  Adjustment.  Whenever the number of Warrant  Shares or number or
kind of  securities  or other  property  purchasable  upon the  exercise of this
Warrant or the Exercise Price is adjusted, as herein provided, the Company shall
promptly mail by registered or certified mail, return receipt requested,  to the
holder of this Warrant notice of such  adjustment or  adjustments  setting forth
the number of Warrant Shares (and other securities or property) purchasable upon
the exercise of this Warrant and the Exercise  Price of such Warrant Shares (and
other  securities  or property)  after such  adjustment,  setting  forth a brief
statement  of  the  facts  requiring  such  adjustment  and  setting  forth  the
computation by which such  adjustment was made.  Such notice,  in the absence of
manifest  error,  shall  be  conclusive  evidence  of the  correctness  of  such
adjustment.

                                       5

<PAGE>

14.      Notice of Corporate Action.  If at any time:

                           (a) the Company shall take a record of the holders of
its Common  Stock for the  purpose of  entitling  them to receive a dividend  or
other  distribution,  or any right to subscribe for or purchase any evidences of
its  indebtedness,  any shares of stock of any class or any other  securities or
property, or to receive any other right, or

                           (b) there shall be any capital  reorganization of the
Company,  any  reclassification  or recapitalization of the capital stock of the
Company  or any  consolidation  or  merger  of the  Company  with,  or any sale,
transfer or other disposition of all or substantially  all the property,  assets
or business of the Company to, another corporation or,

                           (c)  there  shall  be  a  voluntary  or   involuntary
dissolution, liquidation or winding up of the Company;
then, in any one or more of such cases,  the Company shall give to Holder (i) at
least 30 days' prior written  notice of the date on which a record date shall be
selected for such dividend,  distribution or right or for determining  rights to
vote  in  respect  of  any  such   reorganization,   reclassification,   merger,
consolidation, sale, transfer, disposition,  liquidation or winding up, and (ii)
in the case of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, dissolution, liquidation or winding up, at least 30
days'  prior  written  notice of the date when the same shall take  place.  Such
notice in accordance  with the foregoing  clause also shall specify (i) the date
on which  any such  record  is to be taken  for the  purpose  of such  dividend,
distribution  or right,  the date on which the holders of Common  Stock shall be
entitled  to any such  dividend,  distribution  or  right,  and the  amount  and
character  thereof,  and  (ii)  the  date  on  which  any  such  reorganization,
reclassification,    merger,   consolidation,   sale,   transfer,   disposition,
dissolution,  liquidation  or winding  up is to take place and the time,  if any
such  time is to be fixed,  as of which the  holders  of Common  Stock  shall be
entitled  to  exchange  their  shares of Common  Stock for  securities  or other
property deliverable upon such disposition,  dissolution, liquidation or winding
up. Each such written notice shall be sufficiently  given if addressed to Holder
at the  last  address  of  Holder  appearing  on the  books of the  Company  and
delivered in accordance with Section 16(d).

                                       6

<PAGE>

15. Authorized  Shares. The Company covenants that during the period the Warrant
is outstanding,  it will reserve from its authorized and unissued Common Stock a
sufficient  number of shares to provide for the  issuance of the Warrant  Shares
upon the exercise of any purchase rights under this Warrant. The Company further
covenants that its issuance of this Warrant shall  constitute  full authority to
its officers who are charged with the duty of executing  stock  certificates  to
execute and issue the  necessary  certificates  for the Warrant  Shares upon the
exercise of the purchase  rights under this  Warrant.  The Company will take all
such  reasonable  action as may be necessary to assure that such Warrant  Shares
may be issued as provided  herein  without  violation of any  applicable  law or
regulation, or of any requirements of the Principal Market upon which the Common
Stock may be listed.

                           The  Company  shall  not  by any  action,  including,
without  limitation,  amending its certificate of  incorporation  or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities  or any other  voluntary  action,  avoid or seek to avoid the
observance or performance  of any of the terms of this Warrant,  but will at all
times in good  faith  assist in the  carrying  out of all such  terms and in the
taking of all such  actions as may be necessary  or  appropriate  to protect the
rights of Holder  against  impairment.  Without  limiting the  generality of the
foregoing,  the  Company  will (a) not  increase  the par value of any shares of
Common  Stock  receivable  upon the  exercise of this  Warrant  above the amount
payable  therefor upon such exercise  immediately  prior to such increase in par
value, (b) take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of
Common Stock upon the exercise of this Warrant,  and (c) use its best efforts to
obtain  all  such  authorizations,   exemptions  or  consents  from  any  public
regulatory  body having  jurisdiction  thereof as may be necessary to enable the
Company to perform its obligations under this Warrant.

                           Upon the request of Holder,  the Company  will at any
time during the period this Warrant is outstanding  acknowledge  in writing,  in
form reasonably  satisfactory to Holder, the continuing validity of this Warrant
and the obligations of the Company hereunder.

                           Before   taking  any  action  which  would  cause  an
adjustment reducing the current Exercise Price below

the then par value, if any, of the shares of Common Stock issuable upon exercise
of the  Warrants,  the  Company  shall take any  corporate  action  which may be
necessary in order that the Company may validly and legally issue fully paid and
non-assessable shares of such Common Stock at such adjusted Exercise Price.

                           Before  taking any action  which  would  result in an
adjustment  in the number of shares of Common  Stock for which  this  Warrant is
exercisable  or in the  Exercise  Price,  the  Company  shall  obtain  all  such
authorizations or exemptions  thereof,  or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.

                                       7

<PAGE>

16.      Miscellaneous.

(a)  Jurisdiction.  This Warrant shall be binding upon any successors or assigns
of the Company.  This Warrant shall  constitute a contract under the laws of New
York without regard to its conflict of law,  principles or rules, and be subject
to arbitration pursuant to the terms set forth in the Purchase Agreement.

(b)  Restrictions.  The  holder  hereof  acknowledges  that the  Warrant  Shares
acquired  upon the  exercise  of this  Warrant,  if not  registered,  will  have
restrictions upon resale imposed by state and federal securities laws.

(c)  Nonwaiver  and  Expenses.  No course of  dealing or any delay or failure to
exercise any right  hereunder on the part of Holder shall operate as a waiver of
such  right  or  otherwise  prejudice  Holder's  rights,   powers  or  remedies,
notwithstanding  all rights hereunder  terminate on the Termination Date. If the
Company fails to comply with any  provision of this  Warrant,  the Company shall
pay to  Holder  such  amounts  as shall be  sufficient  to cover  any  costs and
expenses including,  but not limited to, reasonable  attorneys' fees,  including
those of appellate proceedings, incurred by Holder in collecting any amounts due
pursuant hereto or in otherwise enforcing any of its rights,  powers or remedies
hereunder.

(d) Notices.  Any notice,  request or other document required or permitted to be
given or  delivered  to the holder  hereof by the Company  shall be delivered in
accordance with the notice provisions of the Purchase Agreement.

(e) Limitation of Liability.  No provision hereof, in the absence of affirmative
action by Holder to purchase shares of Common Stock,  and no enumeration  herein
of the rights or privileges of Holder  hereof,  shall give rise to any liability
of Holder for the purchase  price of any Common Stock or as a stockholder of the
Company,  whether  such  liability is asserted by the Company or by creditors of
the Company.

(f)  Remedies.  Holder,  in  addition to being  entitled to exercise  all rights
granted by law,  including  recovery  of  damages,  will be entitled to specific
performance  of its rights under this Warrant.  The Company agrees that monetary
damages would not be adequate  compensation for any loss incurred by reason of a
breach by it of the  provisions  of this Warrant and hereby  agrees to waive the
defense  in any action for  specific  performance  that a remedy at law would be
adequate.

(g) Successors and Assigns.  Subject to applicable securities laws, this Warrant
and the rights and  obligations  evidenced  hereby shall inure to the benefit of
and be  binding  upon the  successors  of the  Company  and the  successors  and
permitted  assigns of Holder.  The provisions of this Warrant are intended to be
for the  benefit of all Holders  from time to time of this  Warrant and shall be
enforceable by any such Holder or holder of Warrant Shares.

(h)  Indemnification.  The Company agrees to indemnify and hold harmless  Holder
from and against  any  liabilities,  obligations,  losses,  damages,  penalties,
actions,   judgments,  suits,  claims,  costs,  attorneys'  fees,  expenses  and
disbursements  of any kind which may be imposed  upon,  incurred  by or asserted
against  Holder in any manner  relating  to or arising out of any failure by the
Company to perform or observe  in any  material  respect  any of its  covenants,
agreements,  undertakings  or obligations  set forth in this Warrant;  provided,
however,  that the Company  will not be liable  hereunder to the extent that any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims,  costs,  attorneys' fees, expenses or disbursements are found in a final
non-appealable  judgment by a court to have resulted  from Holder's  negligence,
bad  faith  or  willful   misconduct  in  its  capacity  as  a  stockholder   or
warrantholder of the Company.

                                       8

<PAGE>

(i)  Amendment. This Warrant may be modified or amended or the provisions hereof
waived with the written consent of the Company and the Holder.

(j)  Severability.  Wherever  possible,  each provision of this Warrant shall be
interpreted  in such manner as to be effective and valid under  applicable  law,
but if any  provision of this Warrant  shall be  prohibited  by or invalid under
applicable  law,  such  provision  shall be  ineffective  to the  extent of such
prohibition or invalidity, without invalidating the remainder of such provisions
or the remaining provisions of this Warrant.

(k)  Headings.  The  headings  used in this Warrant are for the  convenience  of
reference only and shall not, for any purpose, be deemed a part of this Warrant.

                  IN WITNESS WHEREOF,  the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.

Dated: February ____, 2000
                                     MEDISYS TECHNOLOGIES, INC.

                                     By:
                                     Edward P. Sutherland, Chairman and CEO

                                       9

<PAGE>

                               NOTICE OF EXERCISE

To:      MEDISYS TECHNOLOGIES, INC.

(1)______The  undersigned  hereby elects to purchase  ________  shares of Common
Stock (the "Common Stock"), of Medisys Technologies,  Inc. pursuant to the terms
of the attached  Warrant,  and tenders herewith payment of the exercise price in
full, together with all applicable transfer taxes, if any.

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

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

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

Dated:

              ------------------------------
              Signature

<PAGE>

                                 ASSIGNMENT FORM

                    (To  assign the  foregoing  warrant,  execute  this form and
                   supply required information.

                 Do not use this form to exercise the warrant.)

                  FOR VALUE  RECEIVED,  the  foregoing  Warrant  and all  rights
evidenced thereby are hereby assigned to

                                                whose address is
-----------------------------------------------
---------------------------------------------------------------.

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

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

                  Holder's Signature:
                                      -----------------------------
                  Holder's Address:
                                      -----------------------------

Signature Guaranteed:
                      ---------------------------------------------

NOTE: The signature to this  Assignment Form must correspond with the name as it
appears on the face of the Warrant,  without  alteration or  enlargement  or any
change whatsoever,  and must be guaranteed by a bank or trust company.  Officers
of  corporations  and  those  acting  in an  fiduciary  or other  representative
capacity  should  file  proper  evidence of  authority  to assign the  foregoing
Warrant.

<PAGE>

-------------------------------------------------------------------------------
       EPSTEIN BECKER & GREEN, P.C.
                New York                                  JOB NO.
       DOCUMENT PROFILE SHEET                                      ------------
-------------------------------------------------------------------------------

                                               DATE / TIME NEEDED:
                                                                  -------------

CLIENT/MATTER NAME:                 CURZON CAPITAL CORP/General
                                    ---------------------------
CLIENT/MATTER ID:                   21653/100
                                    ---------

DOCUMENT NAME:                      Stock Purchase Agreement

                                    ------------------------
AUTHOR:                             Joseph Smith
RETURN TO:                          J. Smith
                                    --------

  STATUS:                        DEPARTMENT:
  (  )  Draft                    (  )  Health (Health)
  (  )  Final                    (  )  Corporate/Securities (CorpSec)
  (  )  Single Space             (  )  Tax Pension Employee Benefits (PenEmptTx)
  (  )  Double Space             (  )  Labor (Labor)
  (  )  Input                    (  )  Bankruptcy (Bankrupt)
  (  )  Revisions                (  )  Real Estate (Real)
  (  )  Print Out                (  )  Trust & Estates (Estates)
  (  )  Scan                     (  )  Litigation: Non-Labor (Litigate)

  PAPER:                         MISCELLANEOUS:
  (  )  White 81/2x 11           (  )  Back        (Velobind)
  (  )  Legal  81/2x 14                            (Fold-over)
  (  )  Letterhead               (  )  Covers
  (  )  Redrules 8 1/2x 11
  (  )  Will Paper 8 1/2x 14

  (  )  DUPE & REVISE: ______         Original:
                                                    ----------------------------

  (  )  COMPARE-RITE:________         Original:
                                                    ----------------------------

                    _________         Revise:
                                                    ----------------------------

        (OPTIONS) -       ADDITIONS:

                              (  )  Bold & Double Underline

                                    ========================

                          DELETIONS:

                              (  )  ^ (carat)     OR    (  )  Strikethrough

SPECIAL INSTRUCTIONS:

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

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

                                 Call when done: Ext.         4924
                                                          --------------

SPELL-CHECKED BY:  ________________  (Write your initials; do not type.)

PRACTICE AREA:                        CORPORATE
                                      ---------

DOCUMENT NUMBER:                      NY:95601.4
                                      ----------

DATE/TIME:                            04/28/00 - 5:30 AM      OPERATOR: admin
                                      ------------------

<PAGE>

                                                                      EXHIBIT C

                          REGISTRATION RIGHTS AGREEMENT

                  THIS REGISTRATION  RIGHTS AGREEMENT,  dated as of February 23,
2000, between the investor or investors signatory hereto (each an "Investor" and
together the "Investors"),  and Medisys  Technologies,  Inc., a Utah corporation
(the "Company").

                  WHEREAS,  simultaneously  with the  execution  and delivery of
this  Agreement,  the Investor is  purchasing  from the  Company,  pursuant to a
Convertible  Debentures and Warrants  Purchase  Agreement  dated the date hereof
(the "Purchase Agreement"),  in the aggregate, up to $2,000,000 principal sum of
Convertible  Debentures  and  Warrants to  purchase up to 125,000  shares of the
Company's  Common  Stock  (terms not  defined  herein  shall  have the  meanings
ascribed to them in the Purchase Agreement); and

                  WHEREAS,  the Company  desires to grant to the  Investors  the
registration  rights set forth herein with respect to the  Conversion  Shares of
Common Stock  issuable upon  conversion  of or as interest upon the  Convertible
Debentures  purchased  pursuant to the Purchase  Agreement  and shares of Common
Stock  issuable  upon exercise of the Warrants  (hereinafter  referred to as the
"Stock" or "Securities" of the Company).

                  NOW, THEREFORE, the parties hereto mutually agree as follows:

                  Section 1.  Registrable  Securities.  As used  herein the term
"Registrable Security" means the Securities until (i) the Registration Statement
has been declared  effective by the  Commission,  and all  Securities  have been
disposed of pursuant to the  Registration  Statement,  (ii) all Securities  have
been sold under  circumstances  under which all of the applicable  conditions of
Rule 144 (or any  similar  provision  then in force)  under the  Securities  Act
("Rule 144") are met,  (iii) all Securities  have been otherwise  transferred to
holders who may trade such Securities  without  restriction under the Securities
Act,  and the  Company  has  delivered a new  certificate  or other  evidence of
ownership for such Securities not bearing a restrictive legend or (iv) such time
as, in the opinion of counsel to the Company, all Securities may be sold without
any time, volume or manner  limitations  pursuant to Rule 144(k) (or any similar
provision  then in  effect)  under the  Securities  Act.  The term  "Registrable
Securities" means any and/or all of the securities  falling within the foregoing
definition   of  a   "Registrable   Security."  In  the  event  of  any  merger,
reorganization,  consolidation,  recapitalization  or other  change in corporate
structure affecting the Common Stock, such adjustment shall be deemed to be made
in the  definition  of  "Registrable  Security"  as is  appropriate  in order to
prevent  any  dilution or  enlargement  of the rights  granted  pursuant to this
Agreement.

                  Section   2.   Restrictions   on   Transfer.   Each   Investor
acknowledges and understands that prior to the registration of the Securities as
provided herein,  the Securities are "restricted  securities" as defined in Rule
144 promulgated under the Act. Each Investor  understands that no disposition or
transfer  of the  Securities  may be made by  Investor  in the absence of (i) an
opinion  of  counsel  to  the  Investor,   in  form  and  substance   reasonably
satisfactory to the Company, that such transfer may be made without registration
under the Securities Act or (ii) such registration.

                           With a view to making  available to the Investors the
benefits  of Rule 144 under the  Securities  Act or any  other  similar  rule or
regulation of the  Commission  that may at any time permit the Investors to sell
securities of the Company to the public without  registration  ("Rule 144"), the
Company agrees to:

                           (a) comply with the provisions of paragraph (c)(1) of
Rule 144; and

                                      1

<PAGE>

                           (b) file with the  Commission  in a timely manner all
reports and other documents required to be filed with the Commission pursuant to
Section 13 or 15(d) under the  Exchange  Act by  companies  subject to either of
such  sections,  irrespective  of whether  the  Company is then  subject to such
reporting requirements.

                  Section 3. Registration Rights With Respect to the Securities.

                           (a) The Company  agrees that it will prepare and file
with the Securities and Exchange  Commission  ("Commission"),  within forty-five
(45) days after the Closing Date a registration statement (on Form S-3, or other
appropriate   registration   statement  form)  under  the  Securities  Act  (the
"Registration  Statement"),  at the  sole  expense  of the  Company  (except  as
provided in Section 3(c) hereof), in respect of the Investors, so as to permit a
public  offering and resale of the Securities  under the Act by the Investors as
selling stockholders and not as underwriters.

                           The Company  shall use its best efforts to cause such
Registration  Statement to become  effective  within one hundred (100) days from
the first Closing Date, or, if earlier, within five (5) days of SEC clearance to
request  acceleration of  effectiveness.  The number of shares designated in the
Registration Statement to be registered shall include all the Warrant Shares, at
least 200% of the shares issuable upon conversion of the Convertible  Debentures
based upon the  Conversion  Price in effect on the day prior to the filing date,
and such  number of shares as the  Company  deems  prudent  for the  purpose  of
issuing shares of Common Stock as interest on the  Convertible  Debentures,  and
shall  include  appropriate  language  regarding  reliance  upon Rule 416 to the
extent permitted by the Commission. The Company will notify the Investors of the
effectiveness  of the  Registration  Statement  within one  Trading  Day of such
event.  In the event that the number of shares so  registered  shall prove to be
insufficient to register the resale of all of the  Securities,  then the Company
shall be obligated to file, within thirty (30) days of notice from any Investor,
a further Registration Statement registering such remaining shares and shall use
diligent best efforts to prosecute  such  additional  Registration  Statement to
effectiveness within ninety (90) days of the date of such notice.

                           (b)  The  Company  will  maintain  the   Registration
Statement or post-effective amendment filed under this Section 3 effective under
the Securities Act until the earlier of (i) the date that none of the Securities
covered by such Registration Statement are or may become issued and outstanding,
(ii) the  date  that all of the  Securities  have  been  sold  pursuant  to such
Registration  Statement,  (iii) the date the  Investors  receive  an  opinion of
counsel to the Company,  which  counsel  shall be  reasonably  acceptable to the
Investors,  that the  Securities  may be sold under the  provisions  of Rule 144
without  limitation  as to  volume,  (iv) all  Securities  have  been  otherwise
transferred to persons who may trade such shares without  restriction  under the
Securities  Act,  and the  Company  has  delivered  a new  certificate  or other
evidence of ownership for such securities not bearing a restrictive  legend,  or
(v) all  Securities may be sold without any time,  volume or manner  limitations
pursuant  to Rule  144(k) or any  similar  provision  then in  effect  under the
Securities Act in the opinion of counsel to the Company,  which counsel shall be
reasonably  acceptable to the Investor  (the  "Effectiveness  Period"),  or (vi)
three (3) years from the first Closing Date.

                           (c)  All  fees,   disbursements   and   out-of-pocket
expenses and costs  incurred by the Company in connection  with the  preparation
and  filing  of  the  Registration  Statement  under  subparagraph  3(a)  and in
complying  with  applicable  securities  and Blue Sky laws  (including,  without
limitation,  all attorneys'  fees of the Company) shall be borne by the Company.
The Investors shall bear the cost of underwriting  and/or  brokerage  discounts,
fees and commissions,  if any, applicable to the Securities being registered and
the fees and expenses of their  counsel.  The  Investors and their counsel shall
have a reasonable  period,  not to exceed five (5) Trading  Days,  to review the
proposed Registration  Statement or any amendment thereto,  prior to filing with
the  Commission,  and the Company shall provide each Investor with copies of any
comment letters received from the Commission with respect thereto within two (2)
Trading Days of receipt thereof. The Company shall qualify any of the securities
for sale in such states as any Investor reasonably  designates and shall furnish
indemnification in the manner provided in Section 6 hereof. However, the Company
shall not be required  to qualify in any state  which will  require an escrow or
other  restriction  relating to the Company  and/or the  sellers,  or which will
require  the  Company  to qualify to do  business  in such state or require  the
Company to file therein any general  consent to service of process.  The Company
at its  expense  will  supply  the  Investors  with  copies  of  the  applicable
Registration  Statement and the  prospectus  included  therein and other related
documents in such quantities as may be reasonably requested by the Investors.

                                       2

<PAGE>

                           (d) The Company shall not be required by this Section
3 to include an Investor's Securities in any Registration  Statement which is to
be filed if, in the  opinion of counsel  for both the  Investor  and the Company
(or,  should they not agree,  in the opinion of another  counsel  experienced in
securities  law matters  acceptable to counsel for the Investor and the Company)
the  proposed  offering  or other  transfer  as to which  such  registration  is
requested is exempt from applicable  federal and state securities laws and would
result in all  purchasers  or  transferees  obtaining  securities  which are not
"restricted securities", as defined in Rule 144 under the Securities Act.

                           (e) In the event that (i) the Registration  Statement
to be filed by the Company  pursuant to Section 3(a) above is not filed with the
Commission  within  forty-five  (45)  days  from the  Closing  Date,  (ii)  such
Registration  Statement is not declared  effective by the Commission  within the
earlier  of one  hundred  (100) days from the  Closing  Date or five (5) days of
clearance by the Commission to request  effectiveness,  (iii) such  Registration
Statement is not maintained as effective by the Company for the period set forth
in Section 3(b) above or (iv) the additional  Registration Statement referred to
in Section 3(a) is not filed within  forty-five (45) days or declared  effective
within  one  hundred  (100)  days as set  forth  therein  (each a  "Registration
Default") then the Company will pay Investor (pro rated on a daily basis if less
than a month),  as liquidated  damages for such failure and not as a penalty two
percent (2%) of the aggregate  market value of shares of Common Stock  purchased
from the Company  (including the Conversion  Shares which would be issuable upon
conversion  of the  Convertible  Debentures  on any date of  determination,  and
whether or not the Convertible Preferred Shares are then Convertible pursuant to
their terms) and held by the Investor until such Registration Statement has been
filed, and in the event of late  effectiveness (in case of clause (ii) above) or
lapsed  effectiveness (in the case of clause (iii) above),  two percent (2%) per
month (pro rated on a daily basis for periods less than thirty (30) days) of the
aggregate  market value of shares of Common Stock purchased from the Company and
held by the Investor  (including the  Conversion  Shares which would be issuable
upon conversion of the Convertible Debentures on any date of determination,  and
whether or not the Convertible Debentures are then convertible pursuant to their
terms) (regardless of whether one or more such Registration Defaults are then in
existence) until such Registration  Statement has been declared effective.  Such
payment of the liquidated damages shall be made to the Investors in cash, within
five (5) calendar days of demand,  provided,  however,  that the payment of such
liquidated  damages  shall not  relieve  the  Company  from its  obligations  to
register the Securities pursuant to this Section. The market value of the Common
Stock  for this  purpose  shall be the  closing  price  (or  last  trade,  if so
reported) on the Principal Market for each day during such Registration Default.
Notwithstanding anything to the contrary contained herein, a failure to maintain
the  effectiveness  of an filed  Registration  Statement  or the  ability  of an
Investor to use an otherwise effective  Registration Statement to effect resales
of Securities during the period after 45 days and within 90 days from the end of
the Company's fiscal year resulting solely from the need to update the Company's
financial statements contained or incorporated by reference in such Registration
Statement shall not constitute a Registration  Default and shall not trigger the
accrual of liquidated damages hereunder.

                           If the  Company  does not  remit the  payment  to the
Investors as set forth  above,  the Company  will pay the  Investors  reasonable
costs of collection,  including  attorneys'  fees, in addition to the liquidated
damages. The registration of the Securities pursuant to this provision shall not
affect or limit the  Investors'  other  rights or  remedies as set forth in this
Agreement.

                                       3

<PAGE>

                           (f)  The   Company   shall  not   include  any  other
securities  in any  Registration  Statement  in which it is  required to include
Securities pursuant to this Section 3.

                           (g) If at any  time or from  time to time  after  the
effective date of any Registration Statement, the Company notifies the Investors
in writing of the existence of a Potential Material Event (as defined in Section
3(h) below),  the Investors  shall not offer or sell any Securities or engage in
any other transaction involving or relating to Securities,  from the time of the
giving of notice with respect to a Potential  Material Event until the Investors
receive  written  notice from the Company  that such  Potential  Material  Event
either has been  disclosed  to the public or no longer  constitutes  a Potential
Material Event; provided, however, that the Company may not so suspend the right
to such holders of  Securities  for more than twenty (20) days in the  aggregate
during any twelve month period, during the period the Registration  Statement is
required to be in effect, and if such period is exceeded,  such event shall be a
Registration  Default.  If a Potential  Material  Event shall occur prior to the
date a  Registration  Statement  is  required  to be filed,  then the  Company's
obligation to file such Registration  Statement shall be delayed without penalty
for not more  than  twenty  (20)  days,  and  such  delay or  delays  shall  not
constitute  a  Registration  Default.  The  Company  must,  if lawful,  give the
Investors notice in writing at least two (2) Trading Days prior to the first day
of the blackout period.

                           (h)  "Potential  Material  Event"  means  any  of the
following:  (a) the possession by the Company of material  information  not ripe
for disclosure in a registration  statement,  as determined in good faith by the
Chief Executive Officer or the Board of Directors of the Company that disclosure
of such  information  in a  Registration  Statement  would be detrimental to the
business and affairs of the Company;  or (b) any material engagement or activity
by the  Company  which  would,  in the good  faith  determination  of the  Chief
Executive  Officer  or the  Board of  Directors  of the  Company,  be  adversely
affected  by  disclosure  in  a  registration  statement  at  such  time,  which
determination  shall be accompanied by a good faith  determination  by the Chief
Executive  Officer or the Board of Directors of the Company that the  applicable
Registration  Statement would be materially  misleading  absent the inclusion of
such information.

                  Section  4.  Cooperation  with  Company.  The  Investors  will
cooperate  with the Company in all respects in connection  with this  Agreement,
including timely supplying all information  reasonably  requested by the Company
(which shall include all information regarding the Investors and proposed manner
of  sale  of  the  Registrable  Securities  required  to  be  disclosed  in  any
Registration  Statement)  and executing  and returning all documents  reasonably
requested  in  connection  with the  registration  and  sale of the  Registrable
Securities  and  entering  into  and  performing  their  obligations  under  any
underwriting  agreement,  if the offering is an underwritten  offering, in usual
and  customary  form,  with the managing  underwriter  or  underwriters  of such
underwritten offering.  Nothing in this Agreement shall obligate any Investor to
consent  to be  named  as an  underwriter  in any  Registration  Statement.  The
obligation  of the  Company to  register  the  Registrable  Securities  shall be
absolute and  unconditional  as to those  Securities  which the Commission  will
permit to be registered without naming the Investors as underwriters.  Any delay
or delays caused by the Investors by failure to cooperate as required  hereunder
shall not constitute a Registration Default.

                  Section  5.  Registration  Procedures.  If  and  whenever  the
Company is required by any of the  provisions  of this  Agreement  to effect the
registration  of any of the  Registrable  Securities  under the Act, the Company
shall (except as otherwise  provided in this  Agreement),  as  expeditiously  as
possible,  subject to the Investors'  assistance  and  cooperation as reasonably
required with respect to each Registration Statement:

                           (a) (i)  prepare  and file with the  Commission  such
amendments and supplements to the Registration Statement and the prospectus used
in connection therewith as may be necessary to keep such Registration  Statement
effective and to comply with the  provisions of the Act with respect to the sale
or other disposition of all securities covered by such registration statement

                                       4

<PAGE>

whenever the  Investors  shall  desire to sell or otherwise  dispose of the same
(including  prospectus  supplements with respect to the sales of securities from
time to time in connection  with a registration  statement  pursuant to Rule 415
promulgated under the Act) and (ii) take all lawful action such that each of (A)
the Registration  Statement and any amendment  thereto does not, when it becomes
effective,  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  light  of the  circumstances  under  which  they  were  made,  not
misleading and (B) the prospectus  forming part of the  Registration  Statement,
and any  amendment  or  supplement  thereto,  does  not at any time  during  the
Registration  Period  include 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 light of the circumstances  under which they were made,
not misleading;

                           (b) (i) prior to the filing  with the  Commission  of
any  Registration   Statement   (including  any  amendments   thereto)  and  the
distribution or delivery of any prospectus  (including any supplements thereto),
provide  draft copies  thereof to the  Investors as required by Section 3(c) and
reflect in such documents all such comments as the Investors (and their counsel)
reasonably  may  propose  respecting  the  Selling   Shareholders  and  Plan  of
Distribution  sections (or  equivalents)  and (ii) furnish to each Investor such
numbers of copies of a  prospectus  including a  preliminary  prospectus  or any
amendment or supplement to any prospectus, as applicable, in conformity with the
requirements  of the  Act,  and  such  other  documents,  as such  Investor  may
reasonably  request in order to facilitate the public sale or other  disposition
of the securities owned by such Investor;

                           (c) register and qualify the  Registrable  Securities
covered by the  Registration  Statement under such other  securities or blue sky
laws of such jurisdictions as the Investors shall reasonably request (subject to
the limitations set forth in Section 3(c) above),  and do any and all other acts
and things  which may be  necessary  or  advisable  to enable  each  Investor to
consummate  the public sale or other  disposition  in such  jurisdiction  of the
securities owned by such Investor;

                           (d) list such Registrable Securities on the Principal
Market,  if the listing of such  Registrable  Securities is then permitted under
the rules of such Principal Market;

                           (e)  notify   each   Investor  at  any  time  when  a
prospectus relating thereto covered by the Registration Statement is required to
be  delivered  under  the Act,  of the  happening  of any  event of which it has
knowledge  as a result  of which the  prospectus  included  in the  Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material  fact  required to be stated  therein or  necessary to
make the  statements  therein not  misleading in the light of the  circumstances
then existing, and the Company shall prepare and file a curative amendment under
Section 5(a) as quickly as commercially possible;

                           (f) as promptly as  practicable  after becoming aware
of such event, notify each Investor who holds Registrable  Securities being sold
(or, in the event of an underwritten offering, the managing underwriters) of the
issuance  by the  Commission  of any  stop  order  or  other  suspension  of the
effectiveness  of the Registration  Statement at the earliest  possible time and
take all lawful  action to effect the  withdrawal,  recession or removal of such
stop order or other suspension;

                           (g) cooperate  with the  Investors to facilitate  the
timely  preparation and delivery of certificates for the Registrable  Securities
to  be  offered  pursuant  to  the   Registration   Statement  and  enable  such
certificates  for the  Registrable  Securities  to be in such  denominations  or
amounts,  as the  case may be,  as the  Investors  reasonably  may  request  and
registered  in such names as the Investors  may request;  and,  within three (3)
Trading  Days  after  a  Registration   Statement  which  includes   Registrable
Securities  is declared  effective  by the  Commission,  deliver and cause legal
counsel  selected  by the  Company  to  deliver  to the  transfer  agent for the
Registrable Securities (with copies to the Investors) an appropriate instruction
and, to the extent necessary, an opinion of such counsel;

                                       5

<PAGE>

                           (h) take all such  other  lawful  actions  reasonably
necessary to expedite and facilitate  the  disposition by the Investors of their
Registrable Securities in accordance with the intended methods therefor provided
in the  prospectus  which  are  customary  for  issuers  to  perform  under  the
circumstances;

                           (i)  in  the  event  of  an  underwritten   offering,
promptly  include or  incorporate in a prospectus  supplement or  post-effective
amendment  to the  Registration  Statement  such  information  as  the  managers
reasonably  agree  should be included  therein and to which the Company does not
reasonably object and make all required filings of such prospectus supplement or
post-effective  amendment  as soon as  practicable  after it is  notified of the
matters  to be  included  or  incorporated  in  such  Prospectus  supplement  or
post-effective amendment; and

                           (j) maintain a transfer  agent and  registrar for its
Common Stock.

                  Section 6. Indemnification.

                           (a) To the  maximum  extent  permitted  by  law,  the
Company agrees to indemnify and hold harmless the Investors and each person,  if
any, who controls an Investor  within the meaning of the  Securities Act (each a
"Distributing  Investor")  against any losses,  claims,  damages or liabilities,
joint or several (which shall, for all purposes of this Agreement,  include, but
not be limited to, all  reasonable  costs of defense and  investigation  and all
reasonable attorneys' fees and expenses), to which the Distributing Investor may
become subject,  under the Securities Act or otherwise,  insofar as such losses,
claims,  damages or liabilities (or actions in respect  thereof) arise out of or
are based upon any untrue  statement or alleged untrue statement of any material
fact contained in any Registration Statement, or any related final prospectus or
amendment or supplement  thereto, or arise out of or are based upon the omission
or alleged  omission  to state  therein a material  fact  required  to be stated
therein or necessary to make the statements  therein not  misleading;  provided,
however, that the Company will not be liable in any such case to the extent, and
only to the extent, that any such loss, claim, damage or liability arises out of
or is based upon an untrue  statement or alleged untrue statement or omission or
alleged omission made in such Registration  Statement,  preliminary  prospectus,
final  prospectus or amendment or supplement  thereto in reliance  upon,  and in
conformity  with,   written   information   furnished  to  the  Company  by  the
Distributing Investor, its counsel, affiliates or any underwriter,  specifically
for use in the preparation thereof. This indemnity agreement will be in addition
to any liability which the Company may otherwise have.

                           (b) To the  maximum  extent  permitted  by law,  each
Distributing  Investor  agrees  that it will  indemnify  and hold  harmless  the
Company,  and each  officer and  director of the Company or person,  if any, who
controls  the Company  within the  meaning of the  Securities  Act,  against any
losses,  claims,  damages or liabilities  (which shall, for all purposes of this
Agreement,  include,  but not be limited to, all reasonable costs of defense and
investigation  and all  reasonable  attorneys'  fees and  expenses) to which the
Company or any such officer,  director or controlling  person may become subject
under the Securities Act or otherwise,  insofar as such losses,  claims, damages
or  liabilities  (or actions in respect  thereof) arise out of or are based upon
any untrue  statement or alleged untrue statement of any material fact contained
in any Registration  Statement,  or any related final prospectus or amendment or
supplement  thereto,  or arise  out of or are  based  upon the  omission  or the
alleged  omission to state therein a material fact required to be stated therein
or necessary to make the  statements  therein not  misleading,  but in each case
only to the extent that such untrue  statement  or alleged  untrue  statement or
omission or alleged  omission  was made in such  Registration  Statement,  final
prospectus  or  amendment  or  supplement  thereto  in  reliance  upon,  and  in
conformity  with,  written   information   furnished  to  the  Company  by  such
Distributing Investor, its counsel, affiliates or any underwriter,  specifically
for use in the preparation thereof. This indemnity agreement will be in addition
to any liability which the Distributing Investor may otherwise have.

                                       6

<PAGE>

                           (c) Promptly  after receipt by an  indemnified  party
under this Section 6 of notice of the  commencement  of any action  against such
indemnified party, such indemnified party will, if a claim in respect thereof is
to be made  against  the  indemnifying  party  under this  Section 6, notify the
indemnifying party in writing of the commencement  thereof;  but the omission so
to notify the indemnifying  party will not relieve the  indemnifying  party from
any liability  which it may have to any  indemnified  party except to the extent
the  failure of the  indemnified  party to  provide  such  written  notification
actually prejudices the ability of the indemnifying party to defend such action.
In case any such  action  is  brought  against  any  indemnified  party,  and it
notifies the indemnifying  party of the commencement  thereof,  the indemnifying
party will be entitled to  participate  in, and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, assume the defense
thereof,  subject to the  provisions  herein  stated and after  notice  from the
indemnifying  party to such  indemnified  party of its election so to assume the
defense thereof,  the indemnifying  party will not be liable to such indemnified
party under this Section 6 for any legal or other expenses subsequently incurred
by such  indemnified  party in  connection  with the defense  thereof other than
reasonable  costs of  investigation,  unless the  indemnifying  party  shall not
pursue the action to its final  conclusion.  The indemnified  parties as a group
shall have the right to employ one  separate  counsel in any such  action and to
participate  in the defense  thereof,  but the fees and expenses of such counsel
shall not be at the expense of the indemnifying  party if the indemnifying party
has assumed the defense of the action with counsel  reasonably  satisfactory  to
the  indemnified  party  unless  (i) the  employment  of such  counsel  has been
specifically  authorized in writing by the indemnifying party, or (ii) the named
parties to any such action  (including any impleaded  parties)  include both the
indemnified  party and the  indemnifying  party and the indemnified  party shall
have been  advised by its counsel  that there may be one or more legal  defenses
available to the indemnifying party different from or in conflict with any legal
defenses  which  may  be  available  to  the  indemnified  party  or  any  other
indemnified party (in which case the indemnifying party shall not have the right
to assume the defense of such  action on behalf of such  indemnified  party,  it
being understood, however, that the indemnifying party shall, in connection with
any one such action or separate but substantially  similar or related actions in
the  same  jurisdiction   arising  out  of  the  same  general   allegations  or
circumstances,  be  liable  only for the  reasonable  fees and  expenses  of one
separate  firm of  attorneys  for the  indemnified  party,  which  firm shall be
designated  in writing by the  indemnified  party).  No settlement of any action
against an indemnified  party shall be made without the prior written consent of
the indemnified party, which consent shall not be unreasonably  withheld so long
as such  settlement  includes a full release of claims  against the  indemnified
party.

                  Section  7.  Contribution.  In order to  provide  for just and
equitable  contribution  under the  Securities  Act in any case in which (i) the
indemnified party makes a claim for indemnification pursuant to Section 6 hereof
but is judicially  determined  (by the entry of a final  judgment or decree by a
court of  competent  jurisdiction  and the  expiration  of time to appeal or the
denial  of the last  right  of  appeal)  that  such  indemnification  may not be
enforced in such case  notwithstanding  the fact that the express  provisions of
Section 6 hereof provide for  indemnification in such case, or (ii) contribution
under the Securities Act may be required on the part of any  indemnified  party,
then the Company and the applicable  Distributing  Investor shall  contribute to
the  aggregate  losses,  claims,  damages  or  liabilities  to which they may be
subject (which shall,  for all purposes of this Agreement,  include,  but not be
limited to, all reasonable costs of defense and investigation and all reasonable
attorneys'  fees and  expenses),  in either such case (after  contribution  from
others) on the basis of relative fault as well as any other  relevant  equitable
considerations.  The relative  fault shall be  determined by reference to, among
other things,  whether the untrue or alleged untrue statement of a material fact
or the  omission  or  alleged  omission  to state a  material  fact  relates  to
information  supplied  by  the  Company  on  the  one  hand  or  the  applicable
Distributing  Investor  on the other hand,  and the  parties'  relative  intent,
knowledge,  access to  information  and  opportunity  to correct or prevent such
statement or omission.  The Company and the Distributing  Investor agree that it
would not be just and equitable if contribution  pursuant to this Section 7 were
determined by pro rata  allocation  or by any other method of  allocation  which
does  not take  account  of the  equitable  considerations  referred  to in this
Section 7. The amount paid or payable by an indemnified party as a result of the
losses,  claims, damages or liabilities (or actions in respect thereof) referred
to above in this  Section  7 shall  be  deemed  to  include  any  legal or other
expenses  reasonably  incurred  by such  indemnified  party in  connection  with
investigating  or  defending  any such  action  or claim.  No  person  guilty of
fraudulent  misrepresentation  (within  the  meaning  of  Section  11(f)  of the
Securities  Act) shall be entitled to  contribution  from any person who was not
guilty of such fraudulent misrepresentation.

                                       7

<PAGE>

Notwithstanding any other provision of this Section 7, in no event shall any (i)
Investor be required to  undertake  liability to any person under this Section 7
for any amounts in excess of the dollar amount of the proceeds  received by such
Investor  from  the  sale  of  such  Investor's  Registrable  Securities  (after
deducting any fees,  discounts and commissions  applicable  thereto) pursuant to
any  Registration   Statement  under  which  such  Registrable   Securities  are
registered  under  the  Securities  Act and  (ii)  underwriter  be  required  to
undertake  liability  to any person  hereunder  for any amounts in excess of the
aggregate discount, commission or other compensation payable to such underwriter
with respect to the  Registrable  Securities  underwritten by it and distributed
pursuant to such Registration Statement.

                  Section 8. Notices. All notices, demands, requests,  consents,
approvals,  and other communications required or permitted hereunder shall be in
writing and, unless  otherwise  specified  herein,  shall be (i) hand delivered,
(ii) deposited in the mail,  registered or certified,  return receipt requested,
postage  prepaid,  (iii) delivered by reputable air courier service with charges
prepaid,  or (iv)  transmitted  by  facsimile,  addressed  as set  forth  in the
Purchase  Agreement or to such other address as such party shall have  specified
most recently by written notice. Any notice or other  communication  required or
permitted to be given hereunder shall be deemed effective (a) upon hand delivery
or  delivery  by  facsimile,   with  accurate  confirmation   generated  by  the
transmitting  facsimile  machine,  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 first  business day  following the date of sending
by reputable courier service,  fully prepaid,  addressed to such address, or (c)
upon actual  receipt of such  mailing,  if mailed.  Either party hereto may from
time to time  change its  address or  facsimile  number for  notices  under this
Section 8 by giving at least ten (10) days' prior written notice of such changed
address or facsimile number to the other party hereto.

                  Section 9.  Assignment.  This  Agreement  is binding  upon and
inures  to the  benefit  of the  parties  hereto  and  their  respective  heirs,
successors and permitted  assigns.  The rights granted the Investors  under this
Agreement  may  be  assigned  to  any  purchaser  of  substantially  all  of the
Registrable  Securities (or the rights  thereto) from an Investor,  as otherwise
permitted by the Purchase Agreement.

                  Section 10. Additional  Covenants of the Company.  The Company
agrees that at such time as it otherwise meets the  requirements  for the use of
Securities Act Registration Statement on Form S-3 for the purpose of registering
the Registrable  Securities,  it shall file all reports and information required
to be filed by it with the Commission in a timely manner and take all such other
action so as to maintain such eligibility for the use of such form.

                  Section  11.  Counterparts/Facsimile.  This  Agreement  may be
executed  in two or  more  counterparts,  each  of  which  shall  constitute  an
original,  but all of which, when together shall constitute but one and the same
instrument,  and shall become effective when one or more  counterparts have been
signed by each party hereto and delivered to the other  parties.  In lieu of the
original, a facsimile transmission or copy of the original shall be as effective
and enforceable as the original.

                                       8

<PAGE>

                  Section 12. Remedies.  The remedies provided in this Agreement
are cumulative  and not exclusive of any remedies  provided by law. If any term,
provision,  covenant  or  restriction  of this  Agreement  is held by a court of
competent  jurisdiction  to be  invalid,  illegal,  void or  unenforceable,  the
remainder of the terms, provisions,  covenants and restrictions set forth herein
shall remain in full force and effect and shall in no way be affected,  impaired
or invalidated,  and the parties hereto shall use their best efforts to find and
employ an alternative means to achieve the same or substantially the same result
as that contemplated by such term, provision, covenant or restriction.

                  Section 13.  Conflicting  Agreements.  The  Company  shall not
enter into any agreement  with respect to its  securities  that is  inconsistent
with the  rights  granted  to the  holders  of  Registrable  Securities  in this
Agreement or  otherwise  prevents  the Company  from  complying  with all of its
obligations hereunder.

                  Section 14.  Headings.  The headings in this Agreement are for
reference  purposes  only  and  shall  not  affect  in any  way the  meaning  or
interpretation of this Agreement.

                  Section 15. Governing Law,  Arbitration.  This Agreement shall
be governed by and  construed  in  accordance  with the laws of the State of New
York  applicable to contracts made in New York by persons  domiciled in New York
City and without  regard to its  principles  of conflicts  of laws.  Any dispute
under this  Agreement  shall be  submitted  to  arbitration  under the  American
Arbitration  Association  (the "AAA") in New York City,  New York,  and shall be
finally and  conclusively  determined by the decision of a board of  arbitration
consisting  of three  (3)  members  (hereinafter  referred  to as the  "Board of
Arbitration") selected as according to the rules governing the AAA. The Board of
Arbitration shall meet on consecutive  business days in New York City, New York,
and shall reach and render a decision in writing  (concurred in by a majority of
the members of the Board of  Arbitration)  with  respect to the amount,  if any,
which the losing  party is  required  to pay to the other  party in respect of a
claim  filed.  In  connection  with  rendering  its  decisions,   the  Board  of
Arbitration  shall  adopt and follow  the laws of the State of New York.  To the
extent  practical,  decisions of the Board of  Arbitration  shall be rendered no
more than thirty (30) calendar days following  commencement of proceedings  with
respect thereto. The Board of Arbitration shall cause its written decision to be
delivered to all parties involved in the dispute. Any decision made by the Board
of  Arbitration  (either  prior to or after the  expiration  of such thirty (30)
calendar day period)  shall be final,  binding and  conclusive on the parties to
the dispute,  and entitled to be enforced to the fullest extent permitted by law
and entered in any court of  competent  jurisdiction.  The Board of  Arbitration
shall be authorized and is hereby directed to enter a default  judgment  against
any party failing to  participate in any  proceeding  hereunder  within the time
periods set forth in the AAA rules. The non-prevailing  party to any arbitration
(as  determined  by the  Board of  Arbitration)  shall pay the  expenses  of the
prevailing party,  including reasonable attorneys' fees, in connection with such
arbitration.  Any party  shall be entitled  to obtain  injunctive  relief from a
court in any case where such relief is available,  and the non-prevailing  party
in any such  injunctive  proceeding  shall pay the  expenses  of the  prevailing
party,  including reasonable attorneys' fees, in connection with such injunctive
proceeding.

                                       9

<PAGE>

                  IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this
Registration  Rights  Agreement to be duly  executed,  on the day and year first
above written.

                            MEDISYS TECHNOLOGIES, INC.

                            By:   /s/Edward P. Sutherland
                                  -----------------------
                                  Edward P. Sutherland, Chairman and CEO

                            AMRO International, S.A.

                            By:   /s/H. U. Bachofen
                                  -----------------
                                  H. U. Bachofen, Director

                                       10

<PAGE>

                                                                      EXHIBIT D

                                ESCROW AGREEMENT

                  THIS  ESCROW  AGREEMENT  (this  "Agreement")  is  made  as  of
February  23,  2000 by and  among  Medisys  Technologies,  Inc.,  a  corporation
incorporated under the laws of the State of Utah (the "Company"),  the investors
signatory  hereto (each an "Investor" and together the  "Investors") and Epstein
Becker & Green,  P.C.,  (the  "Escrow  Agent").  Capitalized  terms used but not
defined  herein shall have the meanings set forth in the  Convertible  Debenture
and Warrants Purchase Agreement referred to in the first recital.

                              W I T N E S S E T H:

                  WHEREAS, the Investors will be purchasing from the Company, in
the aggregate,  up to $2,000,000  principal sum of Convertible  Debentures  (the
"Convertible  Debentures")  and Warrants to purchase,  in the  aggregate,  up to
125,000  shares  of  Common  Stock,  at the  purchase  price  set  forth  in the
Convertible   Debentures   and  Warrants   Purchase   Agreement  (the  "Purchase
Agreement")  dated the date hereof between the Investors and the Company,  which
will be issued as per the terms contained herein and in the Purchase  Agreement;
and

                  WHEREAS, it is intended that the purchase of the securities be
consummated  in  accordance  with the  requirements  set forth by Sections  4(2)
and/or 4(6) and/or Regulation D promulgated under the Securities Act of 1933, as
amended; and

                  WHEREAS, the Company and the Investors have requested that the
Escrow Agent hold the applicable  Purchase Price with respect to each Closing in
escrow  until the Escrow  Agent has received  the  Convertible  Debentures,  the
Warrants and certain other closing documents specified herein;

                  NOW,  THEREFORE,  in consideration of the covenants and mutual
promises contained herein and other good and valuable consideration, the receipt
and legal  sufficiency  of which are hereby  acknowledged  and  intending  to be
legally bound hereby, the parties agree as follows:

                                   ARTICLE 1
                               TERMS OF THE ESCROW

1.1. The parties  hereby  agree to  establish an escrow  account with the Escrow
Agent  whereby the Escrow Agent (i) shall hold the funds for the purchase of the
initial $1,000,000 principal sum Convertible  Debentures and the Warrants at the
first Closing as  contemplated  by the Purchase  Agreement,  (ii) shall hold the
funds for the purchase of the $500,000  principal sum Convertible  Debentures at
the second  Closing as  contemplated  by the Purchase  Agreement and (iii) shall
hold the  funds for the  purchase  of the  $500,000  principal  sum  Convertible
Debentures at the third Closing as contemplated by the Purchase Agreement

1.2. (a) At each  Closing,  upon the Escrow  Agent's  receipt of the  applicable
Purchase  Price for the  Closing  into its  attorney  trustee  account  from the
Investors,  together with, at the first Closing,  executed  counterparts of this
Agreement,  the Purchase  Agreement and the Registration  Rights  Agreement,  it
shall telephonically advise the Company, or the Company's designated attorney or
agent, of the amount of funds it has received into its account.

                                       1

<PAGE>

(b)      Wire transfers to the Escrow Agent shall be made as follows:

                                    Epstein Becker & Green, P.C.
                                    Master Escrow Account
                                    Chase Manhattan Bank
                                    1411 Broadway - Fifth Floor
                                    New York, New York  10018
                                    ABA No. 021000021
                                    Account No. 035-1-346036
                                    Attention:  L. Borneo

         1.3. At the first  Closing,  the Company,  upon receipt of said notice,
shall  deliver  to  the  Escrow  Agent  Convertible  Debentures  evidencing  the
$1,000,000  principal  amount of  Convertible  Debentures and the Warrants to be
issued to each Investor at such Closing together with:

         (i) the original executed  Registration Rights Agreement in the form of
         Exhibit C to the Purchase Agreement;

         (ii)  Instructions  to  Transfer  Agent in the form of Exhibit F to the
         Purchase Agreement;

         (iii) the original executed opinion of Leonard E. Neilson,  Esq. in the
         form of Exhibit E to the Purchase Agreement;

         (iv) an original counterpart of this Escrow Agreement; and

         (v)  warrants,  in addition to the warrants  purchased  pursuant to the
         Warrant,  identical in form to that of the Investors,  for seventy-five
         thousand  (75,000)  shares  registered in the name of Jesup & Lamont as
         its commission.

                  In the event  that the  foregoing  items are not in the Escrow
Agent's  possession  within three (3) Trading Days of the Escrow Agent notifying
the Company that the Escrow Agent has custody of the Purchase  Price  applicable
to such  Convertible  Debentures,  then each  Investor  shall  have the right to
demand the return of said Purchase Price.

         1.4. At the first  Closing,  once Escrow Agent confirms the validity of
the issuance of the applicable  Convertible Debentures and the Warrants by means
of its  receipt  of a Release  Notice in the form  attached  hereto as Exhibit X
executed by the Company and each Investor,  it shall enter the Exercise Price on
the face of each Warrant, insert the applicable Closing Date on each Convertible
Debenture  and  then  wire  that  amount  of funds  necessary  to  purchase  the
applicable  Convertible  Debenture and the Warrants per the written instructions
of the Company,  net of nine  percent (9%) of the Purchase  Price as directed by
Jesup & Lamont as payment of their fee.

         Once the funds (as set forth  above)  have been sent per the  Company's
instructions,  the  Escrow  Agent  shall  then  arrange  to have the  applicable
Convertible Debentures,  the Warrants, the Registration Rights Agreement and the
opinion of counsel  delivered  as per  instructions  from the  Investors  and to
deliver the Instructions to Transfer Agent to the Transfer Agent.

         1.5. At the second Closing, the Company, upon receipt of said notice of
receipt  of funds,  shall  deliver to the Escrow  Agent  Convertible  Debentures
evidencing the $500,000 principal amount of Convertible  Debentures to be issued
to the Investors.

                                       2

<PAGE>

         In the event that the  foregoing  items are not in the  Escrow  Agent's
possession  within  three (3) Trading  Days of the Escrow  Agent  notifying  the
Company that the Escrow Agent has custody of the Purchase  Price  applicable  to
such Convertible  Debentures,  then each Investor shall have the right to demand
the return of said Purchase Price.

         Once  Escrow  Agent  confirms  the  validity  of  the  issuance  of the
Convertible  Debentures by means of its receipt of a Release  Notice in the form
attached hereto as Exhibit X executed by the Company and each Investor, it shall
insert  the  applicable  Closing  Date on  Convertible  Debenture  and it  shall
immediately  wire that  amount of funds  necessary  to purchase  the  applicable
Convertible  Debenture per the written  instructions of the Company, net of nine
percent (9%) of the  Purchase  Price as directed by Jesup & Lamont as payment of
their fee.

         Once the funds (as set forth  above)  have been sent per the  Company's
instructions,  the  Escrow  Agent  shall  then  arrange  to have the  applicable
Convertible Debentures delivered as per instructions from the Investors.

         1.6. At the third Closing, the Company,  upon receipt of said notice of
receipt  of funds,  shall  deliver to the Escrow  Agent  Convertible  Debentures
evidencing the $500,000 principal amount of Convertible  Debentures to be issued
to the Investors.

         In the event that the  foregoing  items are not in the  Escrow  Agent's
possession  within  three (3) Trading  Days of the Escrow  Agent  notifying  the
Company that the Escrow Agent has custody of the Purchase  Price  applicable  to
such Convertible  Debentures,  then each Investor shall have the right to demand
the return of said Purchase Price.

         Once  Escrow  Agent  confirms  the  validity  of  the  issuance  of the
Convertible  Debenture  by means of its receipt of a Release  Notice in the form
attached hereto as Exhibit X executed by the Company and each Investor, it shall
insert the applicable  Closing Date on each  Convertible  Debenture and it shall
immediately  wire that  amount of funds  necessary  to purchase  the  applicable
Convertible Debenture per the written instructions of the Company.

         Once the funds (as set forth  above)  have been sent per the  Company's
instructions,  the  Escrow  Agent  shall  then  arrange  to have the  applicable
Convertible Debentures delivered as per instructions from the Investors.

                                   ARTICLE 2
                                  MISCELLANEOUS

         2.1.  No  waiver or any  breach of any  covenant  or  provision  herein
contained  shall be  deemed a  waiver  of any  preceding  or  succeeding  breach
thereof, or of any other covenant or provision herein contained. No extension of
time for  performance  of any obligation or act shall be deemed any extension of
the time for performance of any other obligation or act.

         2.2.  Except  as  otherwise  set  forth  above,  all  notices  or other
communications required or permitted hereunder shall be in writing, and shall be
sent as set forth in the Purchase Agreement.

         2.3. This Escrow Agreement shall be binding upon and shall inure to the
benefit of the permitted successors and permitted assigns of the parties hereto.

                                       3

<PAGE>

         2.4. This Escrow Agreement is the final expression of, and contains the
entire agreement between,  the parties with respect to the subject matter hereof
and  supersedes  all prior  understandings  with  respect  thereto.  This Escrow
Agreement may not be modified, changed,  supplemented or terminated, nor may any
obligations  hereunder  be waived,  except by written  instrument  signed by the
parties to be charged or by its agent duly authorized in writing or as otherwise
expressly permitted herein.

         2.5.  Whenever  required by the context of this Escrow  Agreement,  the
singular shall include the plural and masculine shall include the feminine. This
Escrow Agreement shall not be construed as if it had been prepared by one of the
parties,  but rather as if both parties had prepared the same.  Unless otherwise
indicated, all references to Articles are to this Escrow Agreement.

         2.6.  The parties  hereto  expressly  agree that this Escrow  Agreement
shall be governed by, interpreted under and construed and enforced in accordance
with the laws of the State of New York.  Any action to enforce,  arising out of,
or relating in any way to, any provisions of this Escrow Agreement shall only be
brought in a state or Federal court sitting in New York City.

         2.7.  The Escrow  Agent's  duties  hereunder  may be altered,  amended,
modified or revoked only by a writing  signed by the Company,  each Investor and
the Escrow Agent.

         2.8. The Escrow Agent shall be obligated  only for the  performance  of
such  duties  as are  specifically  set forth  herein  and may rely and shall be
protected  in relying or  refraining  from acting on any  instrument  reasonably
believed by the Escrow  Agent to be genuine and to have been signed or presented
by the proper party or parties.  The Escrow Agent shall not be personally liable
for any act the Escrow  Agent may do or omit to do hereunder as the Escrow Agent
while acting in good faith, and without gross negligence or willful misconduct.

         2.9. The Escrow Agent is hereby  expressly  authorized to disregard any
and all  warnings  given by any of the parties  hereto or by any other person or
corporation,  excepting  only  orders or  process of courts of law and is hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case the Escrow Agent obeys or complies with any such order,  judgment
or decree,  the Escrow Agent shall not be liable to any of the parties hereto or
to any  other  person,  firm or  corporation  by  reason  of such  decree  being
subsequently reversed,  modified,  annulled, set aside, vacated or found to have
been entered without jurisdiction.

         2.10. The Escrow Agent shall not be liable in any respect on account of
the identity,  authorization or rights of the parties executing or delivering or
purporting  to execute or deliver the  Purchase  Agreement  or any  documents or
papers deposited or called for thereunder.

         2.11.  The Escrow Agent shall be entitled to employ such legal  counsel
and other experts as the Escrow Agent may deem necessary  properly to advise the
Escrow Agent in connection  with the Escrow Agent's duties  hereunder,  may rely
upon  the  advice  of  such  counsel,   and  may  pay  such  counsel  reasonable
compensation  therefor.  The  Escrow  Agent has acted as legal  counsel  for the
Investors, and may continue to act as legal counsel for the Investors, from time
to time,  notwithstanding its duties as the Escrow Agent hereunder.  The Company
consents to the Escrow Agent in such capacity as legal counsel for the Investors
and waives any claim that such representation  represents a conflict of interest
on the part of the Escrow Agent. The Company  understands that the Investors and
the Escrow Agent are relying  explicitly on the foregoing  provision in entering
into this Escrow Agreement.

         2.12. The Escrow  Agent's  responsibilities  as escrow agent  hereunder
shall  terminate  if the Escrow  Agent  shall  resign by  written  notice to the
Company and the Investors.  In the event of any such resignation,  the Investors
and the Company shall appoint a successor Escrow Agent.

                                       4

<PAGE>

         2.13.  If  the  Escrow  Agent  reasonably  requires  other  or  further
instruments in connection  with this Escrow  Agreement or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.

         2.14.  It is  understood  and agreed that should any dispute arise with
respect to the delivery and/or ownership or right of possession of the documents
or the escrow  funds held by the Escrow  Agent  hereunder,  the Escrow  Agent is
authorized and directed in the Escrow  Agent's sole  discretion (1) to retain in
the Escrow  Agent's  possession  without  liability to anyone all or any part of
said  documents or the escrow funds until such disputes  shall have been settled
either by mutual  written  agreement of the parties  concerned by a final order,
decree  or  judgment  or a court of  competent  jurisdiction  after the time for
appeal has expired and no appeal has been perfected,  but the Escrow Agent shall
be under no duty  whatsoever to institute or defend any such  proceedings or (2)
to deliver the escrow  funds and any other  property and  documents  held by the
Escrow Agent  hereunder to a state or Federal  court  having  competent  subject
matter  jurisdiction  and located in the City of New York in accordance with the
applicable procedure therefor.

         2.15.  The Company and each  Investor  agree  jointly and  severally to
indemnify and hold harmless the Escrow Agent and its partners, employees, agents
and representatives from any and all claims,  liabilities,  costs or expenses in
any way  arising  from or relating  to the duties or  performance  of the Escrow
Agent  hereunder  or the  transactions  contemplated  hereby or by the  Purchase
Agreement  other than any such claim,  liability,  cost or expense to the extent
the same shall have been determined by final,  unappealable  judgment of a court
of competent  jurisdiction to have resulted from the gross negligence or willful
misconduct of the Escrow Agent.

                   IN WITNESS  WHEREOF,  the parties  hereto have  executed this
Escrow Agreement as of the date set forth above.

                  Medisys Technologies, Inc.

                  By:  /s/Edward P. Sutherland

                       -----------------------
                       Edward P. Sutherland, Chairman and CEO

                  INVESTOR: AMRO INTERNATIONAL, S.A.

                  By:  /s/H. U. Bachofen
                       -----------------
                       Name: H. U. Bachofen
                         Title: Director

                  ESCROW AGENT:

                  EPSTEIN BECKER & GREEN, P.C.

                  By:  /s/Epstein Becker & Green

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

                                       5

<PAGE>

                                                                    Exhibit X to
                                                                Escrow Agreement

                                 RELEASE NOTICE

                  The UNDERSIGNED, pursuant to the Escrow Agreement, dated as of
February 23, 2000 among Medisys  Technologies,  Inc.,  the  Investors  signatory
thereto  and  Epstein  Becker  & Green,  P.C.,  as  Escrow  Agent  (the  "Escrow
Agreement"; capitalized terms used herein and not defined shall have the meaning
ascribed to such terms in the Escrow Agreement),  hereby notify the Escrow Agent
that  each  of  the  conditions  precedent  to  the  purchase  and  sale  of the
Convertible  Debentures and Warrants set forth in the Convertible  Debenture and
Warrants Purchase Agreement have been satisfied. The Company and the undersigned
Investor  hereby  confirm  that  all of  their  respective  representations  and
warranties  contained  in the  Purchase  Agreement  remain  true and correct and
authorize  the  release by the  Escrow  Agent of the funds and  documents  to be
released at the  Closings as  described  in the Escrow  Agreement.  This Release
Notice shall not be effective until executed by the Company and the Investor.

                  This Release Notice may be signed in one or more counterparts,
each of which shall be deemed an original.

                  IN WITNESS  WHEREOF,  the undersigned have caused this Release
Notice to be duly  executed  and  delivered  as of this __ day of  ____________,
2000.

                               MEDISYS TECHNOLOGIES, INC.

                               By: /s/Edward P. Sutherland
                                   -----------------------
                                   Edward P. Sutherland, Chairman and CEO

                               INVESTOR: AMRO INTERNATIONAL, S.A.

                               By: /s/H. U. Bachofen
                                   -----------------
                                    Name: H. U. Bachofen
                                    Title: Director

                                       6

<PAGE>

                                                                      EXHIBIT E

              FORM OF OPINION OF THE COMPANY'S INDEPENDENT COUNSEL

[Date]

Address

         Re:      Convertible Debentures and Warrants Purchase Agreement between
                  the Investors Signatory thereto and Medisys Technologies, Inc.

Ladies and Gentlemen:

                  This  opinion is  furnished  to you  pursuant to the  Purchase
Agreement by and between the investors  signatory  thereto (the "Investors") and
Medisys  Technologies,  Inc., a Utah corporation  (the  "Company"),  dated as of
February ___, 2000 (the "Purchase  Agreement"),  which provides for the issuance
and sale by the Company of, in the aggregate, (i) up to $2,000,000 principal sum
of Convertible  Debentures and (ii) warrants to purchase up to 250,000 shares of
Common  Stock of the Company  (the  "Warrants").  All terms used herein have the
meanings defined for them in the Purchase  Agreement  unless  otherwise  defined
herein.

                  We have acted as counsel  for the Company in  connection  with
the  negotiation of the Purchase  Agreement,  the  Convertible  Debentures,  the
Warrants,  and the Registration  Rights Agreement  between the Investors and the
Company,  dated as of February __, 2000 (the "Registration  Rights  Agreement"),
and the Escrow Agreement between the Investors, the Company and Epstein Becker &
Green,  P.C.,  dated as of  February  ___,  2000 (the  "Escrow  Agreement",  and
together with the Purchase Agreement,  the Convertible Debentures,  the Warrants
and the Registration  Rights Agreement,  the "Agreements").  As counsel, we have
made  such  legal and  factual  examinations  and  inquiries  as we have  deemed
advisable or necessary for the purpose of rendering  this opinion.  In addition,
we have  examined,  among other  things,  originals or copies of such  corporate
records  of the  Company,  certificates  of  public  officials  and  such  other
documents and  questions of law that we consider  necessary or advisable for the
purpose of  rendering  this  opinion.  In such  examination  we have assumed the
genuineness  of all  signatures  on original  documents,  the  authenticity  and
completeness  of all documents  submitted to us as originals,  the conformity to
original  documents of all copies  submitted to us as copies thereof,  the legal
capacity of natural persons, and the due execution and delivery of all documents
(except as to due execution and delivery by the Company) where due execution and
delivery are a prerequisite to the effectiveness thereof.

                  As used in this opinion,  the  expression  "to our  knowledge"
refers to the current  actual  knowledge of the  attorneys of this firm who have
worked on matters for the Company  solely in connection  with the Agreements and
the  Warrants  and  the  transactions  contemplated  thereby,  and  without  any
independent investigation of any underlying facts or situations.

                  For  purposes of this  opinion,  we have assumed that you have
all  requisite  power  and  authority,  and  have  taken  any and all  necessary
corporate  action,  to execute and deliver the  Agreements,  and we are assuming
that the  representations and warranties made by each Investor in the Agreements
and pursuant thereto are true and correct.

<PAGE>

            Based upon and subject to the foregoing, we are of the opinion that:

         1. The Company is a corporation duly organized, validly existing and in
good  standing  under  the  laws  of the  State  of Utah  and has all  requisite
corporate  power and  authority to carry on its  business and to own,  lease and
operate its  properties  and assets as described in the Company's SEC Documents.
To our knowledge,  the Company does not have any  subsidiaries  and does not own
more than fifty percent (50%) of the outstanding capital stock of or control any
other business entity other than as disclosed in the SEC Documents.

         2. The Company has the requisite corporate power and authority to enter
into and perform its  obligations  under the  Agreements and the Warrants and to
issue the  Convertible  Debentures,  the Exchange  Shares,  the Warrants and the
Warrant Shares.  The execution and delivery of the Agreements by the Company and
the consummation by it of the transactions  contemplated  thereby have been duly
authorized  by  all  necessary  corporate  action  and  no  further  consent  or
authorization  of the  Company  or its Board of  Directors  or  stockholders  is
required,  except that the issuance of Exchange Shares and Warrant Shares may be
limited by the  corporate  governance  rules of the  Principal  Market until the
receipt of stockholder  approval.  Each of the Agreements has been duly executed
and delivered, and the Convertible Debentures certificates and the Warrants have
each been duly  executed,  issued and  delivered  by the Company and each of the
Agreements  and the Warrants  constitutes  valid and binding  obligations of the
Company  enforceable  against the Company in  accordance  with their  respective
terms,  except as such  enforceability may be limited by applicable  bankruptcy,
insolvency,  or similar laws relating to, or affecting generally the enforcement
of, creditors'  rights and remedies or by other equitable  principles of general
application.

         3. The  execution,  delivery and  performance  of the Agreements by the
Company and the  consummation  by the Company of the  transactions  contemplated
thereby,  including,   without  limitation,  the  issuance  of  the  Convertible
Debentures, the Exchange Shares, the Warrants and the Warrant Shares, do not and
will not (i) result in a violation of the Company's Certificate of Incorporation
or By-Laws;  (ii) to our  knowledge,  conflict  with,  or  constitute a material
default  (or an event that 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,  indenture,  instrument
or any "lock-up" or similar  provision of any underwriting or similar  agreement
to which the Company is a party;  or (iii)  result in a violation of any federal
or state  law,  rule or  regulation  applicable  to the  Company or by which any
property  or  asset  of the  Company  is  bound  or  affected,  except  for such
violations  as would  not,  individually  or in the  aggregate,  have a Material
Adverse Effect.  To our knowledge,  the Company is not in violation of any terms
of its Certificate of Incorporation or Bylaws.

         4. The issuance of the Convertible Debentures,  the Exchange Shares and
the Warrants in accordance with the Purchase Agreement,  and the issuance of the
Warrant Shares in accordance with the Warrants, will be exempt from registration
under the Securities Act of 1933, as amended, and will be in compliance with the
state  securities  laws of the Company's  principal  place of business.  When so
issued,  the  Exchange  Shares and the Warrant  Shares will be, duly and validly
issued,  fully paid and nonassessable,  and free of any liens,  encumbrances and
preemptive  or  similar  rights  contained  in  the  Company's   Certificate  of
Incorporation  or Bylaws or, to our  knowledge,  in any  agreement  to which the
Company is party.

         5. We have not been  engaged  to devote  substantive  attention  to any
claims, actions,  suits,  proceedings or investigations that are pending against
the Company or its properties, or against any officer or director of the Company
in his or her capacity as such. To our knowledge,  the Company is not a party to
or subject to the provisions of any order, writ, injunction,  judgment or decree
of any court or government agency or instrumentality.

         6. Assuming  receipt of stockholder  approval as may be required by the
corporate  governance  rules  of  the  Principal  Market,  the  issuance  of the
Convertible Debentures, the Exchange Shares, the Warrants and the Warrant Shares
will not violate the applicable  listing  agreement  between the Company and any
securities exchange or market on which the Company's securities are listed.

         7. The authorized  capital stock of the Company consists of 100,000,000
shares of Common Stock, $.0005 par value per share, and no other shares of which
have been designated as to series or class.

                  This opinion is furnished  to the  Investors  solely for their
benefit  in  connection  with the  transactions  described  above and may not be
relied  upon by any  other  person or for any other  purpose  without  our prior
written consent.

                                                              Very truly yours,

<PAGE>

                                                                       EXHIBIT F
                         INSTRUCTIONS TO TRANSFER AGENT

                           MEDISYS TECHNOLOGIES, INC.

February 25, 2000

Interstate Transfer
874 East 5900 South
Salt Lake City, UT 84107
Attn: Janice Sutherland

Ladies and Gentlemen:

                  Reference is made to the  Convertible  Debenture  and Warrants
Purchase  Agreement  and all  Exhibits  thereto  (the  "Agreement")  dated as of
February 23, 2000, between the investors signatory thereto (the "Investors") and
Medisys  Technologies,  Inc. (the  "Company").  Pursuant to the  Agreement,  and
subject to the terms and conditions set forth in the Agreement,  the Company has
issued to the Investors, in the aggregate, (i) up to $2,000,000 principal sum of
Convertible  Debentures (the  "Debentures")  and (ii) Warrants to purchase up to
125,000  shares  of  Common  Stock  (the  "Warrants").  As a  condition  to  the
effectiveness  of the Agreement,  the Company has agreed to issue to you, as the
transfer agent for the Common Stock (the "Transfer  Agent"),  these instructions
relating  to the  Common  Stock to be issued to the  Investors  (or a  permitted
assignee)  pursuant  to the  Agreement  upon  conversion  of any  portion of the
Debentures or upon exercise of the Warrants.  All capitalized  terms used herein
and not otherwise defined shall have the meaning set forth in the Agreement.

1.       ISSUANCE OF COMMON STOCK WITHOUT THE LEGEND

                           Pursuant to the Agreement and the Registration Rights
Agreement, the Company is required to prepare and file with the Commission,  and
maintain  the  effectiveness  of,  a  registration   statement  or  registration
statements  registering  the resale of the Common  Stock to be  acquired  by the
Investors (i) upon exercise of the Warrants and (ii) upon  conversion  of, or as
payment of dividends  on, the  Debentures,  all as provided in the  Registration
Rights  Agreement.  The Company will advise the Transfer Agent in writing of the
effectiveness  of any  such  registration  statement  promptly  upon  its  being
declared effective,  and shall deliver an opinion of its counsel to that effect.
The Transfer Agent shall be entitled to rely on such advice and such opinion and
shall  assume  that such  registration  statement  remains in effect  unless the
Transfer  Agent is otherwise  advised in writing by the Company or such counsel,
and the  Transfer  Agent  shall not be  required  to  independently  confirm the
continued effectiveness of such registration statement. In the circumstances set
forth in the following three paragraphs, the Transfer Agent shall deliver to the
appropriate  Investor  certificates  representing  Common  Stock not bearing the
Legend   without   requiring   further   advice  or  instruction  or  additional
documentation  from the Company or its counsel or the Investor or its counsel or
any other party (other than as described in such paragraphs).

                           (a) At any  time  after  the  effective  date  of the
registration  statement (provided that the Company has not informed the Transfer
Agent in writing that such  registration  statement is not  effective)  upon any
surrender  of one or more  certificates  evidencing  Common Stock which bear the
Legend,  to the extent  accompanied  by a notice  requesting the issuance of new
certificates free of the Legend to replace those surrendered,  in such names and
in such  denominations as the Investor may request,  provided that in connection
with any such event,  the Investor (or its permitted  assignee) shall confirm in
writing  to the  Transfer  Agent  that (i) the  Investor  has sold,  pledged  or
otherwise  transferred  or agreed to sell,  pledge or  otherwise  transfer  such
Common  Stock  in a bona  fide  transaction  to a  third  party  that  is not an
affiliate of the Company;  and (ii) the Investor  confirms to the transfer agent
that the Investor has complied with the prospectus delivery requirement.

<PAGE>

                           (b) In the  event  a  registration  statement  is not
filed by the  Company,  or for any reason the  registration  statement  which is
filed by the Company is not declared  effective by the  Securities  and Exchange
Commission,  the Investor,  or its permitted assignee, or its broker confirms to
the Transfer  Agent that (i) the Investor has  beneficially  owned the shares of
Common  Stock for at least one year,  (ii)  counting the shares  surrendered  as
being sold upon the date the unlegended  Certificates  would be delivered to the
Investor (or the Trading Day immediately following if such date is not a Trading
Day),  the Investor  will not have sold more than the greater of (a) one percent
(1%) of the total  number  of  outstanding  shares  of  Common  Stock or (b) the
average  weekly  trading volume of the Common Stock for the preceding four weeks
during the three  months  ending  upon such  delivery  date (or the  Trading Day
immediately following if such date is not a Trading Day), and (iii) the Investor
has complied with the manner of sale and notice  requirements  of Rule 144 under
the Securities Act; or

                           (c) The Investor (or its  permitted  assignee)  shall
represent that it is permitted to dispose of such shares of Common Stock without
limitation  as to amount or manner of sale  pursuant  to Rule  144(k)  under the
Securities Act.

                  In the case of  subparagraphs  (b) or (c), the Transfer  Agent
shall be  entitled  to require  an  opinion  of  counsel to the  Company or from
counsel to the  Investor  (which  opinion  shall be from an attorney or law firm
reasonably  acceptable  to the  Transfer  Agent  and be in  form  and  substance
reasonably   acceptable  to  the  Transfer  Agent).   Any  advice,   notice,  or
instructions  to the Transfer Agent required or permitted to be given  hereunder
may be transmitted via facsimile to the  Transfer  Agent's  facsimile  number of
[--------------].

                  2. MECHANICS OF DELIVERY OF CERTIFICATES  REPRESENTING  COMMON
                  STOCK

                           In connection  with any  conversion of any portion of
the Debentures or exercise of Warrants  pursuant to which the Investor  acquires
Common Stock under the  Agreement,  the Transfer  Agent is hereby  instructed to
deliver to the Investor, certificates representing Common Stock (with or without
the  Legend,  as  appropriate)  within  two (2)  Trading  Days of receipt by the
Transfer  Agent  of a copy of the  Notice  of  Conversion  (in  the  case of the
Debentures)  or  Notice  of  Exercise  (in the  case of the  Warrant)  from  the
Investor,  and to deliver  such  certificates  to the  Investor,  in the case of
original issuance, and in the case of subsequent transfer, if the Transfer Agent
is able to deliver such Common Stock to the Investor's  account  pursuant to the
DWAC system of the  Depository  Trust  Company,  the  Transfer  Agent shall make
delivery  pursuant to such system and provide  the  Investor  with  confirmation
thereof in lieu of such Common Stock certificates.

                  3. FEES OF TRANSFER AGENT; INDEMNIFICATION

                                  The Company  agrees to pay the Transfer  Agent
for all fees incurred in connection  with these  Irrevocable  Instructions.  The
Company agrees to indemnify the Transfer  Agent and its officers,  employees and
agents, against any losses, claims, damages or liabilities, joint or several, to
which it or they become subject based upon the performance by the Transfer Agent
of its duties in accordance with the Irrevocable  Instructions,  other than as a
result of the Transfer Agent's gross negligence or willful misconduct.

<PAGE>

                 4.  THIRD PARTY BENEFICIARY

                           The Company and the Transfer  Agent  acknowledge  and
agree that the Investors are each an express  third party  beneficiary  of these
Irrevocable  Instructions  and shall be entitled to rely upon, and enforce,  the
provisions thereof.

                                    MEDISYS TECHNOLOGIES, INC.

                                    By:   /s/Edward P. Sutherland
                                          -----------------------
                                          Edward P. Sutherland, Chairman and CEO

AGREED: Interstate Transfer

By:__________________________
Name:
Title:
<PAGE>

             CONVERTIBLE DEBENTURES AND WARRANTS PURCHASE AGREEMENT

                                     Between

                           Medisys Technologies, Inc.

                                       and

                         the Investors Signatory Hereto

         CONVERTIBLE  DEBENTURES  AND WARRANTS  PURCHASE  AGREEMENT  dated as of
February 23, 2000 (the  "Agreement"),  between the  Investors  signatory  hereto
(each an "Investor"  and together the  "Investors"),  and Medisys  Technologies,
Inc., a corporation  organized and existing  under the laws of the State of Utah
(the "Company").

         WHEREAS,  the parties  desire  that,  upon the terms and subject to the
conditions  contained herein, the Company shall issue and sell to the Investors,
and  the  Investors  shall  purchase,  in the  aggregate,  (i) up to  $2,000,000
principal sum of Convertible Debentures (as defined below) and (ii) Warrants (as
defined  below) to purchase up to 250,000 shares of the Common Stock (as defined
below) at $2.00 per share.

         WHEREAS,  such investments will be made in reliance upon the provisions
of Section 4(2) ("Section 4(2)") and/or 4(6) of the United States Securities Act
and/or  Regulation  D  ("Regulation  D") and the  other  rules  and  regulations
promulgated  thereunder (the "Securities Act"), and/or upon such other exemption
from the  registration  requirements  of the  Securities Act as may be available
with  respect  to  any  or  all of the  investments  in  securities  to be  made
hereunder.

         NOW, THEREFORE, the parties hereto agree as follows:

                                   ARTICLE I

                               Certain Definitions

Section 1.1. "Capital Shares" shall mean the  Common Stock and any shares of any
other class of common  stock  whether now or  hereafter  authorized,  having the
right to participate in the distribution of earnings and assets of the Company.

Section 1.2. "Capital Shares Equivalents" shall mean any securities,  rights, or
obligations  that are convertible  into or exchangeable for or give any right to
subscribe  for any  Capital  Shares of the Company or any  Warrants,  options or
other rights to subscribe for or purchase Capital Shares or any such convertible
or exchangeable securities.

                                       1
<PAGE>

Section 1.3.  "Closing"  shall mean each closing of the purchase and sale of the
Convertible  Debentures  and  Warrants  pursuant to Section  2.1.  Section  1.4.
"Closing  Date" shall mean the date on which all  conditions  to the  applicable
Closing  have been  satisfied  (as  defined in Section  2.1 (b) hereto) and such
Closing  shall  have  occurred.  Section  1.5.  "Common  Stock"  shall  mean the
Company's  common stock,  $.0005 par value per share.  Section 1.6.  "Conversion
Price" shall have the meaning set forth in the Convertible Debentures.

Section 1.7.  "Conversion Shares" shall mean the shares of Common Stock issuable
upon  conversion of the  Convertible  Debentures  and any shares of Common Stock
issued as  payment of  interest  on the  Convertible  Debentures.  Section  1.8.
"Convertible  Debenture" and together the  "Convertible  Debentures"  shall mean
Convertible Debenture(s) in the form of Exhibit A hereto.

Section 1.9. "Damages" shall mean any loss, claim,  damage,  judgment,  penalty,
deficiency,  liability,  costs  and  expenses  (including,  without  limitation,
reasonable  attorney's fees and  disbursements and reasonable costs and expenses
of expert witnesses and investigation).

Section 1.10. "Effective  Date"  shall  mean  the date on  which  the SEC  first
declares  effective  a  Registration  Statement  registering  the  resale of the
Registrable  Securities  as set  forth  in the  Registration  Rights  Agreement.
Section 1.11.   "Escrow  Agent"  shall have the  meaning set forth in the Escrow
Agreement.  Section 1.12.  "Escrow Agreement" shall mean the Escrow Agreement in
substantially   the  form  of   Exhibit   D  hereto   executed   and   delivered
contemporaneously with this Agreement.

Section 1.13. "Exchange Act"  shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.

Section 1.14. "Exercise Price" shall have the meaning set forth in the Warrant.

Section 1.15. "Legend"  shall mean the legend set forth in Section 9.1.

Section 1.16. "Market  Price"  on any  given date shall mean the  average of the
twenty (20) lowest  closing bid prices on the  Principal  Market (as reported by
Bloomberg  L.P.) of the Common  Stock  during the forty (40)  Trading Day period
ending on the  Trading  Day  immediately  prior to the date for which the Market
Price is to be determined.  Section 1.17.  "Material  Adverse Effect" shall mean
any effect on the business,  operations,  properties,  prospects, stock price 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,  the Registration  Rights Agreement,  the Escrow Agreement,  the
Convertible Debentures or the Warrants in any material respect.
                                       2
<PAGE>

Section 1.18. "Outstanding"   when used with reference to shares of Common Stock
or Capital Shares  (collectively  the  "Shares"),  shall mean, at any date as of
which the number of such Shares is to be determined,  all issued and outstanding
Shares,  and shall  include all such Shares  issuable in respect of  outstanding
scrip or any  certificates  representing  fractional  interests  in such Shares;
provided,  however,  that  "Outstanding"  shall  not mean any such  Shares  then
directly  or  indirectly  owned or held by or for the  account  of the  Company.
Section 1.19. "Person" shall mean an individual, a corporation, a partnership, a
limited  liability  company,  an  association,   a  trust  or  other  entity  or
organization,  including a government or political  subdivision  or an agency or
instrumentality thereof.

Section 1.20. "Principal Market" shall mean the American Stock Exchange, the New
York Stock Exchange,  the NASDAQ National Market, the NASDAQ Small-Cap Market or
the OTC Bulletin Board,  whichever is at the time the principal trading exchange
or market for the Common Stock, based upon share volume.

Section  1.21."Purchase  Price"    shall mean the face  principal  amount of the
Convertible Debentures.

Section 1.22. "Registrable  Securities" shall mean the Conversion Shares and the
Warrant Shares until (i) the Registration  Statement has been declared effective
by the SEC, and all  Conversion  Shares and Warrant Shares have been disposed of
pursuant to the Registration  Statement,  (ii) all Conversion Shares and Warrant
Shares  have been sold under  circumstances  under  which all of the  applicable
conditions  of Rule 144 (or any  similar  provision  then in  force)  under  the
Securities  Act ("Rule 144") are met,  (iii) all  Conversion  Shares and Warrant
Shares  have been  otherwise  transferred  to holders  who may trade such shares
without  restriction  under the Securities  Act, and the Company has delivered a
new certificate or other evidence of ownership for such securities not bearing a
restrictive  legend  or (iv)  such time as, in the  opinion  of  counsel  to the
Company,  all Conversion Shares and Warrant Shares may be sold without any time,
volume or manner  limitations  pursuant to Rule 144(k) (or any similar provision
then in effect) under the Securities Act.

Section 1.23. "Registration Rights Agreement" shall mean the agreement regarding
the  filing of the  Registration  Statement  for the  resale of the  Registrable
Securities,  entered  into  between the Company and the Investor as of the first
Closing Date in the form annexed hereto as Exhibit C.
                                       3
<PAGE>

Section 1.24. "Registration  Statement" shall  mean a registration  statement on
Form S-3 (if use of such form is then  available to the Company  pursuant to the
rules of the SEC and,  if not,  on such  other form  promulgated  by the SEC for
which the Company then  qualifies  and which  counsel for the Company shall deem
appropriate,  and which form shall be available  for the resale by the Investors
of the Registrable Securities to be registered thereunder in accordance with the
provisions  of  this  Agreement,   the  Registration  Rights  Agreement  and  in
accordance with the intended method of distribution of such securities), for the
registration of the resale by the Investor of the Registrable  Securities  under
the Securities Act.

Section 1.25.     "Regulation  D"  shall  have  the  meaning  set  forth  in the
recitals of this Agreement.

Section 1.26.     "SEC"  shall mean the Securities and Exchange Commission.

Section 1.27.     "Section  4(2)" and "Section 4(6)" shall have the meanings set
forth in the recitals of this Agreement.

Section 1.28.     "Securities  Act"  shall  have the  meaning  set  forth in the
recitals  of this  Agreement.  Section  1.29.  "SEC  Documents"  shall  mean the
Company's  Annual  Report on Form 10-KSB for the fiscal year ended  December 31,
1998 and each report,  proxy  statement or  registration  statement filed by the
Company with the SEC pursuant to the  Exchange Act or the  Securities  Act since
the filing of such Annual Report through the date hereof.

Section 1.30.     "Shares"  shall have the meaning set forth in Section 1.18.

Section 1.31.     "Trading  Day" shall mean any day during  which the Principal
Market shall be open for business. Section 1.32.

                  "Warrants"  shall mean the Warrants
substantially in the form of Exhibit B to be issued to the Investors hereunder.

Section  1.33.    "Warrant  Shares"  shall  mean all  shares of Common  Stock or
other securities issued or issuable pursuant to exercise of the Warrants.

                                   ARTICLE II

            Purchase and Sale of Convertible Debentures and Warrants

Section 2.1.      Investment.

(a) Upon the terms and subject to the conditions  set forth herein,  the Company
agrees to sell, and the Investors agree to purchase the  Convertible  Debentures
together  with  the  Warrants  at the  Purchase  Price on each  Closing  Date as
follows:

(i)                        First  Closing.  Upon  execution and delivery of this
                           Agreement,   the  Investors  shall  purchase  in  the
                           aggregate  $1,000,000 principal amount of Convertible
                           Debentures  ("First  Funding").  Each Investor  shall
                           deliver to the  Escrow  Agent  immediately  available
                           funds in their  proportionate  amount of the Purchase
                           Price as set forth on the signature pages hereto, and
                           the Company shall deliver the Convertible  Debentures
                           evidencing said principal sum and the Warrants to the
                           Escrow  Agent,  in each case to be held by the Escrow
                           Agent pursuant to the Escrow Agreement.

                                       4
<PAGE>

(ii)                       Second  Closing.  Within  five  (5)  Trading  Days of
                           written notice from the Company to the Investors that
                           the  Registration   Statement  has  been  filed,  the
                           Investors  shall  purchase in the aggregate  $500,000
                           principal  amount of Convertible  Debenture  ("Second
                           Funding").  Each Investor shall deliver to the Escrow
                           Agent   immediately    available   funds   in   their
                           proportionate  amount  of the  Purchase  Price as set
                           forth on the  signature  pages hereto and the Company
                           shall deliver the Convertible  Debentures  evidencing
                           said principal sum to the Escrow Agent, to be held by
                           the Escrow Agent pursuant to the Escrow Agreement.

(iii)                      Third  Closing.  Within  five  (5)  Trading  Days  of
                           written notice from the Company to the Investors that
                           the   Registration   Statement   has  been   declared
                           effective,   the  Investors  shall  purchase  in  the
                           aggregate  $500,000  principal  amount of Convertible
                           Debentures  ("Third  Funding").  Each Investor  shall
                           deliver to the  Escrow  Agent  immediately  available
                           funds  in their  proportionate  amount  of the  Third
                           Funding as set forth on the  signature  pages  hereto
                           and  the  Company  shall   deliver  the   Convertible
                           Debenture evidencing said principal sum to the Escrow
                           Agent, to be held by the Escrow Agent pursuant to the
                           Escrow Agreement.

(iv)                       Each Closing. Upon satisfaction of the conditions set
                           forth in Section  2.1(b),  each  Closing  ("Closing")
                           shall  occur at the  offices of the  Escrow  Agent at
                           which time the  Escrow  Agent (x) shall  release  the
                           applicable  Convertible Debenture and the Warrants to
                           the  Investors  and (y) shall  release  the  Purchase
                           Price  (after all fees have been paid as set forth in
                           the Escrow  Agreement),  pursuant to the terms of the
                           Escrow Agreement.

         (b) Each Closing is subject to the  satisfaction or waiver by the party
to be benefited thereby of the following conditions:

(i)                        acceptance  and  execution  by the Company and by the
                           Investors, of this Agreement and all Exhibits hereto;

(ii)                       delivery into escrow by each Investor of  immediately
                           available  funds in the amount of the Purchase  Price
                           of  the  applicable  Convertible  Debenture  and  the
                           Warrants,  as more  fully  set  forth  in the  Escrow
                           Agreement;

(iii)                      all  representations  and warranties of the Investors
                           contained  herein shall remain true and correct as of
                           each Closing  Date (as a condition  to the  Company's
                           obligations);
                                       5
<PAGE>

(iv)                       all  representations  and  warranties  of the Company
                           contained  herein shall remain true and correct as of
                           each Closing  Date (as a condition to the  Investors'
                           obligations);

(v)                        the  Company  shall have  obtained  all  permits  and
                           qualifications  required  by any  state for the offer
                           and sale of the Convertible  Debentures and Warrants,
                           or  shall  have  the   availability   of   exemptions
                           therefrom;

(vi)                       the sale and issuance of the  Convertible  Debentures
                           and the Warrants hereunder, and the proposed issuance
                           by the Company to the  Investors  of the Common Stock
                           underlying   the   Convertible   Debentures  and  the
                           Warrants  upon the  conversion  or  exercise  thereof
                           shall   be   legally   permitted   by  all  laws  and
                           regulations  to which the  Investors  and the Company
                           are subject and there shall be no ruling, judgment or
                           writ  of  any  court   prohibiting  the  transactions
                           contemplated by this Agreement;

(vii)                      delivery of the  applicable  original  fully executed
                           Convertible   Debentures   (as  to  each   applicable
                           Closing)  and  Warrants  certificates  to the  Escrow
                           Agent (as to the first Closing);

(viii)                     delivery to the Escrow Agent of an opinion of Leonard
                           E.  Neilson,  counsel to the Company,  in the form of
                           Exhibit E hereto (as to the first Closing);

(ix)                       delivery  to the  Escrow  Agent  of  the  Irrevocable
                           Instructions  to Transfer  Agent in the form attached
                           hereto as Exhibit F (as to the first Closing); and

(x)                        delivery  to the  Escrow  Agent  of the  Registration
                           Rights Agreement (as to the first Closing);

(xi)                       as to the second Closing only,  there shall have been
                           no  Material  Adverse  Effect  with  respect  to  the
                           Company  since the date of the first  Closing and the
                           average daily  trading  volume of the Common Stock on
                           the Principal Market for the ten consecutive  Trading
                           Days  ending on the filing  date of the  Registration
                           Statement shall have been at least 40,000 shares; and

(xi)                       as to the third Closing  only,  there shall have been
                           no  Material  Adverse  Effect  with  respect  to  the
                           Company since the date of the second  Closing and the
                           average daily  trading  volume of the Common Stock on
                           the Principal Market for the ten consecutive  Trading
                           Days ending on the Effective  Date shall have been at
                           least 40,000 shares.

Section 2.2. Liquidated  Damages.  The parties hereto acknowledge and agree that
the sums payable pursuant to the Registration  Rights Agreement shall constitute
liquidated damages and not penalties.  The parties further  acknowledge that (a)
the amount of loss or damages likely to be incurred is incapable or is difficult
to  precisely  estimate,  (b) the  amounts  specified  in such  Sections  bear a
reasonable  proportion  and are not plainly or grossly  disproportionate  to the
probable  loss likely to be incurred by the  Investors  in  connection  with the
failure  by the  Company to timely  cause the  registration  of the  Registrable
Securities and (c) the parties are sophisticated  business parties and have been
represented by sophisticated and able legal and financial counsel and negotiated
this Agreement at arm's length.

                                       6
<PAGE>

                                  ARTICLE III

                   Representations and Warranties of Investor

Each Investor, severally and not jointly, represents and warrants to the Company
that:

Section 3.1.  Intent.  The Investor is entering into this  Agreement for its own
account and not with a view to or for sale in connection  with any  distribution
of the Common  Stock.  The Investor has no present  arrangement  (whether or not
legally binding) at any time to sell the Convertible  Debentures,  the Warrants,
any  Conversion  Shares or Warrant  Shares to or  through  any person or entity;
provided,  however, that by making the representations herein, the Investor does
not agree to hold such  securities  for any minimum or other  specific  term and
reserves the right to dispose of the Conversion Shares and Warrant Shares at any
time in accordance  with federal and state  securities  laws  applicable to such
disposition.

Section 3.2.  Sophisticated  Investor.  The Investor is a sophisticated investor
(as described in Rule 506(b)(2)(ii) of Regulation D) and an accredited  investor
(as defined in Rule 501 of  Regulation  D), and Investor has such  experience in
business  and  financial  matters  that it has the  capacity  to protect its own
interests in connection  with this  transaction and is capable of evaluating the
merits and risks of an investment in the  Convertible  Debentures,  the Warrants
and the underlying Common Stock. The Investor acknowledges that an investment in
the  Convertible  Debentures,  the Warrants and the  underlying  Common Stock is
speculative and involves a high degree of risk.

Section 3.3. Authority. This Agreement and each agreement attached as an Exhibit
hereto which is required to be executed by Investor has been duly authorized and
validly  executed  and  delivered  by the  Investor  and is a valid and  binding
agreement of the Investor  enforceable  against it in accordance with its terms,
subject to applicable  bankruptcy,  insolvency,  or similar laws relating to, or
affecting  generally the  enforcement of,  creditors'  rights and remedies or by
other  equitable  principles  of  general  application.   Section  3.4.  Not  an
Affiliate. The Investor is not an officer, director or "affiliate" (as that term
is defined in Rule 405 of the Securities Act) of the Company.

Section 3.5. Absence of Conflicts.  The execution and delivery of this Agreement
and each  agreement  which is attached as an Exhibit  hereto and executed by the
Investor  in  connection  herewith,  and the  consummation  of the  transactions
contemplated hereby and thereby, and compliance with the requirements hereof and
thereof by the  Investor,  will not violate any law,  rule,  regulation,  order,
writ, judgment,  injunction,  decree or award binding on Investor or (a) violate
any provision of any  indenture,  instrument or agreement to which Investor is a
party or is subject,  or by which  Investor  or any of its assets is bound;  (b)
conflict with or  constitute a material  default  thereunder;  (c) result in the
creation or imposition of any lien pursuant to the terms of any such  indenture,
instrument  or agreement,  or constitute a breach of any fiduciary  duty owed by
Investor to any third  party;  or (d) require  the  approval of any  third-party
(which has not been  obtained)  pursuant to any  material  contract,  agreement,
instrument,  relationship or legal obligation to which Investor is subject or to
which any of its assets, operations or management may be subject.

                                       7
<PAGE>

Section 3.6.  Disclosure;  Access to Information.  The Investor has received all
documents, records, books and other publicly available information pertaining to
Investor's  investment in the Company that have been  requested by the Investor.
The Company is subject to the periodic  reporting  requirements  of the Exchange
Act, and the Investor has reviewed  copies of all SEC Documents  deemed relevant
by Investor.

Section 3.7. Manner of Sale. At no time was Investor presented with or solicited
by or through any leaflet, public promotional meeting,  television advertisement
or any other form of general solicitation or advertising.

                                   ARTICLE IV

                  Representations and Warranties of the Company

The Company  represents and Warrants to the Investors that,  except as set forth
on the Disclosure Schedule prepared by the Company and attached hereto:

Section 4.1.  Organization  of the Company.  The Company is a  corporation  duly
incorporated  and existing in good standing  under the laws of the State of Utah
and has all requisite  corporate authority to own its properties and to carry on
its business as now being conducted.  The Company does not have any subsidiaries
and does not own more that fifty percent (50%) of or control any other  business
entity except as set forth in the SEC  Documents.  The Company is duly qualified
and is in good  standing  as a  foreign  corporation  to do  business  in  every
jurisdiction in which the nature of the business  conducted or property owned by
it makes such qualification necessary,  other than those in which the failure so
to qualify would not have a Material Adverse Effect.

Section 4.2.  Authority.  (i)The Company has the requisite  corporate  power and
corporate  authority  to enter  into and  perform  its  obligations  under  this
Agreement,  the Registration  Rights Agreement,  the Escrow  Agreement,  and the
Warrants and to issue the Convertible  Debentures,  the Conversion  Shares,  the
Warrants and the Warrant Shares  pursuant to their  respective  terms,  (ii) the
execution,  issuance and delivery of this  Agreement,  the  Registration  Rights
Agreement,  the Escrow Agreement, the Convertible Debentures and the Warrants by
the Company and the consummation by it of the transactions  contemplated  hereby
will have been duly  authorized by all necessary  corporate  action prior to the
Closing Date and no further consent or authorization of the Company or its Board
of  Directors  or  stockholders  is  required,  and (iii)  this  Agreement,  the
Registration Rights Agreement,  the Escrow Agreement, the Convertible Debentures
and the Warrants  have been duly  executed  and  delivered by the Company and at
each  Closing  shall  constitute  valid and binding  obligations  of the Company
enforceable  against the Company in accordance with their terms,  except as such
enforceability may be limited by applicable bankruptcy,  insolvency,  or similar

                                       8
<PAGE>

laws relating to, or affecting  generally the enforcement of,  creditors' rights
and  remedies  or by other  equitable  principles  of general  application.  The
Company has duly and validly  authorized  and reserved  for  issuance  shares of
Common  Stock  sufficient  in  number  for  the  conversion  of the  Convertible
Debentures  and for the exercise of the Warrants.  The Company  understands  and
acknowledges the potentially dilutive effect to the Common Stock of the issuance
of the Conversion Shares The Company further acknowledges that its obligation to
issue  Conversion  Shares upon  conversion  of the  Convertible  Debentures  and
Warrant  Shares upon exercise of the Warrants in accordance  with this Agreement
and the Convertible  Debentures is absolute and unconditional  regardless of the
dilutive effect that such issuance may have on the ownership  interests of other
stockholders  of the Company and  notwithstanding  the  commencement of any case
under 11 U.S.C. ss. 101 et seq. (the "Bankruptcy  Code").  The Company shall not
seek  judicial  relief from its  obligations  hereunder  except  pursuant to the
Bankruptcy Code. In the event the Company is a debtor under the Bankruptcy Code,
the Company hereby waives to the fullest  extent  permitted any rights to relief
it may have  under  11  U.S.C.  ss.  362 in  respect  of the  conversion  of the
Convertible  Debentures  and the exercise of the Warrants.  The Company  agrees,
without  cost or  expense  to the  Investors,  to take or consent to any and all
action necessary to effectuate relief under 11 U.S.C. ss. 362.

Section  4.3. Capitalization.   The  authorized  capital  stock  of the  Company
consists of 100,000,000 shares of Common Stock,  $0.0005 par value per share, of
which  43,817,289  shares are issued and  outstanding  as of December  31, 1999.
Except as set forth in the Disclosure Schedule, there are no outstanding Capital
Shares  Equivalents nor any agreements or  understandings  pursuant to which any
Capital Shares  Equivalents may become  outstanding.  Except as set forth in the
Disclosure  Schedule,  the  Company  is not a party  to any  agreement  granting
registration  or  anti-dilution  rights to any person with respect to any of its
equity or debt securities.  All of the outstanding shares of Common Stock of the
Company have been duly and validly  authorized and issued and are fully paid and
non-assessable.

Section 4.4.  Common Stock. The Company has registered its Common Stock pursuant
to Section 12(b) or (g) of the Exchange Act and is in full  compliance  with all
reporting  requirements  of the Exchange  Act, and the Company is in  compliance
with all  requirements  for the  continued  listing or  quotation  of its Common
Stock,  and such Common  Stock is currently  listed or quoted on, the  Principal
Market.  As of the date hereof,  the Principal  Market is the OTC Bulletin Board
and the Company has not  received  any notice  regarding,  and to its  knowledge
there is no threat,  of the termination or  discontinuance of the eligibility of
the Common Stock for such listing.

Section 4.5.  SEC  Documents.  The Company has made  available to the  Investors
true and complete  copies of the SEC Documents.  The Company has not provided to
the  Investors  any  information  that,  according to  applicable  law,  rule or
regulation,  should have been disclosed publicly prior to the date hereof by the
Company, but which has not been so disclosed.  As of their respective dates, the
SEC Documents  complied in all material  respects with the  requirements  of the
Exchange Act, and rules and  regulations of the SEC  promulgated  thereunder and
the SEC  Documents  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  SEC  Documents  complied  in  all  material  respects  with  applicable
accounting  requirements  and the published  rules and regulations of the SEC or

                                       9
<PAGE>

other  applicable rules and regulations with respect thereto at the time of such
inclusion.  Such  financial  statements  have been prepared in  accordance  with
generally  accepted  accounting  principles 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 exclude footnotes or may be condensed or summary
statements) and fairly present in all material  respects the financial  position
of the Company as of the dates  thereof and the results of  operations  and cash
flows for the periods  then ended  (subject,  in the case of  unaudited  interim
statements,  to normal year-end audit adjustments).  Neither the Company nor any
of its subsidiaries has any material indebtedness, obligations or liabilities of
any kind (whether accrued, absolute, contingent or otherwise, and whether due or
to become  due) that would  have been  required  to be  reflected  in,  reserved
against or  otherwise  described  in the  financial  statements  or in the notes
thereto in accordance  with GAAP,  which was not fully  reflected  in,  reserved
against or otherwise described in the financial  statements or the notes thereto
included in the SEC  Documents  or was not  incurred in the  ordinary  course of
business  consistent  with the Company's past  practices  since the last date of
such financial statements.

Section 4.6.  Exemption from  Registration;  Valid
Issuances.  Subject to the accuracy of the Investors' representations in Article
III, the sale of the Convertible Debentures, the Conversion Shares, the Warrants
and the Warrant  Shares will not require  registration  under the Securities Act
and/or  any  applicable  state  securities  law.  When  issued  and  paid for in
accordance with the Warrants and validly  converted in accordance with the terms
of the Convertible Debentures, the Conversion Shares and the Warrant Shares will
be duly and validly issued, fully paid, and non-assessable. Neither the sales of
the Convertible  Debentures,  the Conversion Shares, the Warrants or the Warrant
Shares pursuant to, nor the Company's performance of its obligations under, this
Agreement,   the  Registration  Rights  Agreement,  the  Escrow  Agreement,  the
Convertible  Debentures  or the  Warrants  will (i)  result in the  creation  or
imposition by the Company of any liens,  charges,  claims or other  encumbrances
upon the  Convertible  Debentures,  the Conversion  Shares,  the Warrants or the
Warrant  Shares  or,  except as  contemplated  herein,  any of the assets of the
Company, or (ii) entitle the holders of Outstanding Capital Shares to preemptive
or other  rights  to  subscribe  for or  acquire  the  Capital  Shares  or other
securities of the Company.  The Convertible  Debentures,  the Conversion Shares,
the Warrants and the Warrant  Shares shall not subject the Investors to personal
liability to the Company or its creditors by reason of the  possession  thereof.

Section 4.7.  No  General   Solicitation   or  Advertising  in  Regard  to  this
Transaction. Neither the Company nor any of its affiliates nor, to the knowledge
of the Company,  any person  acting on its or their behalf (i) has  conducted or
will  conduct any general  solicitation  (as that term is used in Rule 502(c) of
Regulation D) or general advertising with respect to the sale of the Convertible
Debentures or the Warrants,  or (ii) made any offers or sales of any security or
solicited  any offers to buy any  security  under any  circumstances  that would
require registration of the Convertible  Debentures,  the Conversion Shares, the
Warrants or the Warrant Shares under the Securities Act.

Section 4.8.  No  Conflicts.  The  execution, delivery and  performance  of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby, including without limitation the issuance of and payment of
interest upon the Convertible  Debentures,  the Conversion  Shares, the Warrants
and the Warrant  Shares,  do not and will not (i) result in a  violation  of the

                                       10
<PAGE>

Company's  Certificate  of  Incorporation  or By-Laws or (ii) conflict  with, or
constitute a material  default (or an event that 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, indenture or
instrument, or any "lock-up" or similar provision of any underwriting or similar
agreement to which the Company is a party, or (iii) result in a violation of any
federal,  state or local  law,  rule,  regulation,  order,  judgment  or  decree
(including federal and state securities laws and regulations)  applicable to the
Company or by which any  material  property  or asset of the Company is bound or
affected, nor is the Company otherwise in violation of, conflict with or default
under any of the foregoing  (except in each case for such  conflicts,  defaults,
terminations,  amendments, accelerations,  cancellations and violations as would
not have,  individually or in the aggregate,  a Material  Adverse  Effect).  The
business  of the  Company  is not  being  conducted  in  violation  of any  law,
ordinance  or  regulation  of  any  governmental  entity,  except  for  possible
violations  that  either  singly or in the  aggregate  would not have a Material
Adverse  Effect.  The Company is not required under any 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  Convertible  Debentures  or the  Warrants  in
accordance with the terms hereof (other than any SEC,  Principal Market or state
securities  filings that may be required to be made by the Company subsequent to
the first Closing, any registration statement that may be filed pursuant hereto,
and any shareholder approval required by the rules applicable to companies whose
common stock trades on the Principal Market); provided that, for purposes of the
representation  made in this sentence,  the Company is assuming and relying upon
the accuracy of the relevant  representations  and  agreements  of the Investors
herein.

Section 4.9.  No Material Adverse Change.  Since September 30, 1999, no Material
Adverse  Effect has occurred or exists with  respect to the  Company,  except as
disclosed  in  the  SEC  Documents.

Section 4.10. No Undisclosed Events or Circumstances.  Since September 30, 1999,
no event or  circumstance  has occurred or exists with respect to the Company or
its businesses,  properties, prospects, operations or financial condition, that,
under  applicable  law,  rule  or  regulation,  requires  public  disclosure  or
announcement  prior to the date  hereof by the Company but which has not been so
publicly announced or disclosed in the SEC Documents.

Section 4.11. No  Integrated  Offering.  Other  than  pursuant  to an  effective
registration  statement under the Securities Act, or pursuant to the issuance or
exercise of employee  stock  options,  or  pursuant to its  discussion  with the
Investors in connection with the transactions  contemplated  hereby, the Company
has not issued, offered or sold the Convertible Debentures,  the Warrants or any
shares of Common Stock (including for this purpose any securities of the same or
a similar class as the Convertible Debentures,  the Warrants or Common Stock, or
any  securities   convertible   into  a  exchangeable  or  exercisable  for  the
Convertible  Debentures or Common Stock or any such other securities) within the
six-month  period next  preceding  the date  hereof,  and the Company  shall not
permit any of its  directors,  officers or affiliates  directly or indirectly to
take, any action  (including,  without  limitation,  any offering or sale to any
Person of the Convertible Debentures, Warrants or shares of Common Stock), so as
to make unavailable the exemption from Securities Act registration  being relied
upon by the  Company  for the offer  and sale to  Investors  of the  Convertible
Debentures (and the Conversion  Shares) or the Warrants (and the Warrant Shares)
as contemplated by this Agreement.

                                       11
<PAGE>

Section 4.12. Litigation and Other Proceedings.   Except as disclosed in the SEC
Documents  or the  Disclosure  Schedule,  there  are  no  material  lawsuits  or
proceedings pending or, to the knowledge of the Company, threatened, against the
Company or any  subsidiary,  nor has the  Company  received  any written or oral
notice of any such  action,  suit,  proceeding  or  investigation,  which  could
reasonably be expected to have a Material Adverse Effect. Except as set forth in
the SEC Documents,  no judgment,  order, writ, injunction or decree or award has
been issued by or, to the  knowledge  of the  Company,  requested  of any court,
arbitrator  or  governmental  agency  which could  result in a Material  Adverse
Effect.

Section 4.13. No  Misleading  or Untrue  Communication.  The Company and, to the
knowledge  of the Company,  any person  representing  the Company,  or any other
person selling or offering to sell the Convertible Debentures or the Warrants in
connection with the transaction  contemplated by this Agreement,  have not made,
at any time, any oral  communication in connection with the offer or sale of the
same which contained any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements, in the light of the
circumstances under which they were made, not misleading.

Section 4.14. Material Non-Public Information.  The Company has not disclosed to
the Investors any material non-public  information that (i) if disclosed,  would
reasonably  be  expected  to have a  material  effect on the price of the Common
Stock or (ii) according to applicable law, rule or regulation,  should have been
disclosed  publicly  by the  Company  prior to the date hereof but which has not
been so disclosed.

Section 4.15. Insurance.  The Company and each subsidiary maintains property and
casualty,  general  liability,  workers'  compensation,   environmental  hazard,
personal injury and other similar types of insurance with financially  sound and
reputable insurers that is adequate,  consistent with industry standards and the
Company's  historical  claims  experience.  The Company has not received  notice
from,  and has no knowledge  of any threat by, any insurer  (that has issued any
insurance  policy to the  Company)  that such insurer  intends to deny  coverage
under or cancel,  discontinue  or not renew any  insurance  policy  presently in
force.

Section 4.16. Tax Matters.

                           (a) The Company and each subsidiary has filed all Tax
Returns which it is required to file under applicable laws; all such Tax Returns
are true and accurate and has been  prepared in compliance  with all  applicable
laws;  the  Company  has paid all Taxes  due and  owing by it or any  subsidiary
(whether  or not such Taxes are  required  to be shown on a Tax Return) and have
withheld and paid over to the appropriate  taxing authorities all Taxes which it
is required to withhold from amounts paid or owing to any employee, stockholder,
creditor or other third  parties;  and since  December  31,  1998,  the charges,
accruals  and  reserves  for Taxes with  respect to the Company  (including  any
provisions for deferred income taxes)  reflected on the books of the Company are
adequate  to cover any Tax  liabilities  of the  Company if its current tax year
were treated as ending on the date hereof.

                                       12
<PAGE>

                           (b) No claim has been made by a taxing authority in a
jurisdiction where the Company does not file tax returns that the Company or any
subsidiary is or may be subject to taxation by that  jurisdiction.  There are no
foreign,  federal,  state or local tax  audits  or  administrative  or  judicial
proceedings  pending  or being  conducted  with  respect  to the  Company or any
subsidiary;  no  information  related to Tax matters has been  requested  by any
foreign,  federal,  state or local taxing  authority;  and,  except as disclosed
above,  no written notice  indicating an intent to open an audit or other review
has been received by the Company or any  subsidiary  from any foreign,  federal,
state or local taxing authority.  There are no material unresolved  questions or
claims concerning the Company's Tax liability.  The Company (A) has not executed
or entered into a closing agreement pursuant to ss. 7121 of the Internal Revenue
Code or any  predecessor  provision  thereof or any similar  provision of state,
local or  foreign  law;  or (B) has not  agreed  to or is  required  to make any
adjustments  pursuant to ss. 481 (a) of the Internal Revenue Code or any similar
provision  of state,  local or foreign  law by reason of a change in  accounting
method  initiated by the Company or any of its subsidiaries or has any knowledge
that the IRS has proposed any such adjustment or change in accounting method, or
has any application pending with any taxing authority requesting  permission for
any changes in  accounting  methods that relate to the business or operations of
the  Company.  The Company has not been a United  States real  property  holding
corporation  within the meaning of ss.  897(c)(2) of the  Internal  Revenue Code
during the applicable period specified in ss.  897(c)(1)(A)(ii)  of the Internal
Revenue Code.

                           (c) The Company  has not made an  election  under ss.
341(f) of the Internal  Revenue Code. The Company is not liable for the Taxes of
another person that is not a subsidiary of the Company under (A) Treas. Reg. ss.
1.1502-6 (or  comparable  provisions of state,  local or foreign law),  (B) as a
transferee  or  successor,  (C) by contract or indemnity or (D)  otherwise.  The
Company is not a party to any tax  sharing  agreement.  The Company has not made
any payments,  is obligated to make payments or is a party to an agreement  that
could  obligate it to make any payments that would not be  deductible  under ss.
280G of the Internal Revenue Code.

                           (d) For purposes of this Section 4.16:

                  "IRS" means the United States Internal Revenue Service.

                  "Tax" or "Taxes" means federal, state, county, local, foreign,
                  or  other  income,  gross  receipts,  ad  valorem,  franchise,
                  profits,  sales  or  use,  transfer,   registration,   excise,
                  utility,  environmental,   communications,  real  or  personal
                  property,  capital  stock,  license,  payroll,  wage or  other
                  withholding,  employment,  social security,  severance, stamp,
                  occupation, alternative or add-on minimum, estimated and other
                  taxes of any kind whatsoever  (including,  without limitation,
                  deficiencies,   penalties,  additions  to  tax,  and  interest
                  attributable thereto) whether disputed or not.

                  "Tax Return"  means any return,  information  report or filing
                  with  respect  to  Taxes,  including  any  schedules  attached
                  thereto and including any amendment thereof.

Section 1.17. Property. Except as set forth in the Disclosure Schedule,  neither
the  Company nor any of its  subsidiaries  owns any real  property.  Each of the
Company  and its  subsidiaries  has good and  marketable  title to all  personal
property  owned by it,  free and clear of all liens,  encumbrances  and  defects
except such as do not  materially  affect the value of such  property and do not
materially  interfere with the use made and proposed to be made of such property
by the Company;  and to the Company's  knowledge any real  property,  mineral or
water rights,  and buildings  held under lease by the Company as tenant are held
by it under valid, subsisting and enforceable leases with such exceptions as are
not material and do not  interfere  with the use made and intended to be made of
such property, mineral or water rights, and buildings by the Company.

                                       13
<PAGE>

Section 4.18.  Intellectual  Property.  To the best of the Company's  knowledge,
each  of the  Company  and  its  subsidiaries  owns or  possesses  adequate  and
enforceable  rights  to  use  all  patents,  patent  applications,   trademarks,
trademark  applications,  trade  names,  service  marks,  copyrights,  copyright
applications,  licenses,  know-how (including trade secrets and other unpatented
and/or  unpatentable  proprietary  or  confidential   information,   systems  or
procedures)  and other similar rights and proprietary  knowledge  (collectively,
"Intangibles") necessary for the conduct of its business as now being conducted.
To the Company's knowledge, except as disclosed in the SEC Documents neither the
Company nor any of its  subsidiaries  is infringing upon or in conflict with any
right of any other person with respect to any  Intangibles.  Except as disclosed
in the SEC Documents,  no adverse claims have been asserted by any person to the
ownership  or use of any  Intangibles  and the Company has no  knowledge  of any
basis for such claim.

Section 4.19. Internal Controls and Procedures.  The Company maintains books and
records and internal accounting controls which provide reasonable assurance that
(i) all  transactions  to which the Company or any  subsidiary  is a party or by
which its  properties  are bound are executed with  management's  authorization;
(ii) the recorded  accounting of the Company's  consolidated  assets is compared
with  existing  assets at  regular  intervals;  (iii)  access  to the  Company's
consolidated   assets  is  permitted  only  in  accordance   with   management's
authorization;  and (iv) all transactions to which the Company or any subsidiary
is a party or by which its  properties  are bound are  recorded as  necessary to
permit preparation of the financial statements of the Company in accordance with
U.S. generally accepted accounting principles.

Section 4.20. Payments and Contributions.  Neither the Company,  any subsidiary,
nor any of its directors, officers or, to its knowledge, other employees has (i)
used  any  Company  funds  for any  unlawful  contribution,  endorsement,  gift,
entertainment  or other unlawful expense  relating to political  activity;  (ii)
made any direct or indirect  unlawful payment of Company funds to any foreign or
domestic government  official or employee;  (iii) violated or is in violation of
any provision of the Foreign Corrupt Practices Act of 1977, as amended;  or (iv)
made any bribe,  rebate,  payoff,  influence payment,  kickback or other similar
payment to any person with respect to Company matters.

Section 4.21. No  Misrepresentation.  The  representations and warranties of the
Company contained in this Agreement,  any schedule,  annex or exhibit hereto and
any  agreement,  instrument  or  certificate  furnished  by the  Company  to the
Investors  pursuant to this Agreement,  do not contain any untrue statement of a
material fact or omit to state a material fact required to be stated  therein or
necessary to make the statements  therein,  in light of the circumstances  under
which they were made, not misleading.

                                       14
<PAGE>

ARTICLE V

                           Covenants of the Investors

         Each  Investor,  severally and not jointly,  covenants with the Company
that:

Section 5.1. Compliance with Law. The Investor's trading activities with respect
to  shares  of the  Company's  Common  Stock  will  be in  compliance  with  all
applicable  state and federal  securities  laws, rules and regulations and rules
and regulations of the Principal  Market on which the Company's  Common Stock is
listed.

Section 5.2. No Short Sales. The Investor and its affiliates shall not engage in
short sales of the Company's Common Stock (as defined in applicable SEC and NASD
rules) so long as the Investor holds any unconverted Debentures.

                                   ARTICLE VI

                            Covenants of the Company

Section  6.1. Registration  Rights.   The Company  shall cause the  Registration
Rights Agreement to remain in full force and effect and the Company shall comply
in all material  respects with the terms  thereof.

Section 6.2.  Reservation  of Common Stock.  As of the date hereof,  the Company
has reserved and the Company shall continue to reserve and keep available at all
times,  free of  preemptive  rights,  shares of Common  Stock for the purpose of
enabling  the  Company to issue the  Conversion  Shares and the  Warrant  Shares
pursuant to any  conversion  of the  Convertible  Debentures  or exercise of the
Warrants.  The number of shares so reserved  from time to time,  as  theretofore
increased or reduced as  hereinafter  provided,  may be reduced by the number of
shares  actually  delivered  pursuant  to  any  conversion  of  the  Convertible
Debentures  or  exercise  of the  Warrants  and the number of shares so reserved
shall be increased or decreased to reflect  potential  increases or decreases in
the Common Stock that the Company may thereafter be obligated to issue by reason
of  adjustments  to the  Warrants.

Section 6.3.  Listing of Common Stock. The Company hereby agrees to maintain the
listing of the Common  Stock on a Principal  Market,  and as soon as  reasonably
practicable  following the first Closing to list the  Conversion  Shares and the
Warrant  Shares on the Principal  Market.  The Company  further  agrees,  if the
Company applies to have the Common Stock traded on any other  Principal  Market,
it will  include in such  application  the  Conversion  Shares  and the  Warrant
Shares,  and will take such other  action as is  necessary  or  desirable in the
opinion of the Investors to cause the Conversion Shares and Warrant Shares to be
listed on such other Principal Market as promptly as possible.  The Company will
take all action to continue  the  listing  and trading of its Common  Stock on a
Principal Market  (including,  without  limitation,  maintaining  sufficient net
tangible  assets) and will comply in all respects with the Company's  reporting,
filing and other  obligations  under the bylaws or rules of the Principal Market
and shall provide  Investors with copies of any  correspondence  to or from such
Principal  Market which  questions or threatens  delisting of the Common  Stock,
within  three (3)  Trading  Days of the  Company's  receipt  thereof,  until the
Investors  have disposed of all of their  Registrable  Securities.

                                       15
<PAGE>

Section 6.4.  Exchange Act Registration. The Company will cause its Common Stock
to continue to be  registered  under  Section  12(b) or (g) of the Exchange Act,
will use its best  efforts  to 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  Exchange  Act or the  rules
thereunder) to terminate or suspend such registration or to terminate or suspend
its reporting  and filing  obligations  under said Act until the Investors  have
disposed of all of their Registrable Securities.

Section 6.5.  Legends.  The certificates  evidencing the Registrable  Securities
shall be free of  legends,  except  as set forth in  Article  IX.

Section  6.6. Corporate Existence; Conflicting Agreements. The Company will take
all steps  necessary to preserve and  continue  the  corporate  existence of the
Company.  The  Company  shall not enter into any  agreement,  the terms of which
agreement  would  restrict  or impair  the right or  ability  of the  Company to
perform  any  of its  obligations  under  this  Agreement  or  any of the  other
agreements attached as exhibits hereto or under the Convertible Debentures.

Section 6.7.  Consolidation; Merger.The Company shall not, at any time after the
date hereof,  effect any merger or consolidation of the Company with or into, or
a transfer of all or substantially  all of the assets of the Company to, another
entity (a  "Consolidation  Event")  unless the resulting  successor or acquiring
entity (if not the Company) assumes by written instrument or by operation of law
the  obligation  to  deliver  to the  Investors  such  shares  of  stock  and/or
securities as the Investors are entitled to receive  pursuant to this  Agreement
and the Convertible Debentures.

Section 6.8.  Issuance of Convertible Debentures and Warrant Shares. The sale of
the  Convertible  Debentures  and the  Warrants  and the issuance of the Warrant
Shares  pursuant to  exercise of the  Warrants  and the  Conversion  Shares upon
conversion of the  Convertible  Debentures  shall be made in accordance with the
provisions  and  requirements  of Section  4(2),  4(6) or  Regulation  D and any
applicable  state  securities  law. The Company shall make any necessary SEC and
"blue sky"  filings  required to be made by the Company in  connection  with the
sale of the Securities to the Investors as required by all applicable  laws, and
shall provide a copy thereof to the Investors promptly after such filing.

Section 6.9.  Limitation on Future  Financing.  The Company  agrees that it will
not enter into any sale of its securities for cash at a discount to Market Price
until 180 days after the effective date of the Registration Statement except for
any sales (i) up to 6,000,000  shares of Common Stock pursuant to an equity line
of credit  arrangement,  at a discount to market of no more than fifteen percent
(15%) (ii) pursuant to any presently  existing  employee benefit plan which plan
has  been  approved  by  the  Company's  stockholders,  (iii)  pursuant  to  any
compensatory  plan  for a  full-time  employee  or key  consultant,  (iv)  up to
3,888,889  shares of Common Stock pending  payment on a certain  promissory note
evidencing  payment  to the  Company of  approximately  Seven  Hundred  Thousand
Dollars ($700,000),  or (v) with the prior approval of a majority in interest of
the Investors,  which will not be  unreasonably  withheld,  in connection with a
strategic  partnership or other business  transaction,  the principal purpose of
which is not simply to raise money.

                                       16
<PAGE>

Section 6.10. Pro-Rata  Redemption.  The Company  agrees that if it shall redeem
any of the Convertible  Debentures,  that it shall make such redemption pro-rata
among all Investors in proportion  their  respective  initial  purchases of such
Debentures pursuant to this Agreement.

                                   ARTICLE VII

                            Survival; Indemnification

Section 7.1.  Survival.  The  representations,  warranties and covenants made by
each of the Company and each Investor in this Agreement, the annexes,  schedules
and exhibits hereto and in each  instrument,  agreement and certificate  entered
into and  delivered  by them  pursuant to this  Agreement,  shall  survive  each
Closing and the consummation of the  transactions  contemplated  hereby.  In the
event of a breach or violation  of any of such  representations,  warranties  or
covenants, the party to whom such representations,  warranties or covenants have
been made  shall  have all  rights and  remedies  for such  breach or  violation
available to it under the  provisions  of this  Agreement,  irrespective  of any
investigation  made by or on  behalf  of such  party on or prior to any  Closing
Date.

Section 7.2.  Indemnity.  (a) The Company  hereby  agrees to indemnify  and hold
harmless  the  Investors,  their  respective  Affiliates  and  their  respective
officers,   directors,   partners  and  members  (collectively,   the  "Investor
Indemnitees"), from and against any and all Damages, and agrees to reimburse the
Investor  Indemnitees for all reasonable  out-of-pocket  expenses (including the
reasonable  fees and  expenses  of legal  counsel),  in each  case  promptly  as
incurred  by the  Investor  Indemnitees  and to the extent  arising out of or in
connection with:

(i)      any  misrepresentation,  omission  of  fact  or  breach  of  any of the
         Company's  representations  or warranties  contained in this Agreement,
         the annexes, schedules or exhibits hereto or any instrument,  agreement
         or  certificate  entered into or  delivered by the Company  pursuant to
         this Agreement; or

(ii)     any  failure by the Company to perform in any  material  respect any of
         its covenants,  agreements,  undertakings  or obligations  set forth in
         this  Agreement,  the  annexes,  schedules  or  exhibits  hereto or any
         instrument,  agreement or certificate  entered into or delivered by the
         Company pursuant to this Agreement; or

(iii)    any action  instituted  against the  Investors,  or any of them, by any
         stockholder of the Company who is not an Affiliate of an Investor, with
         respect to any of the transactions contemplated by this Agreement.

(b) Each  Investor,  severally  and not jointly,  hereby agrees to indemnify and
hold  harmless  the  Company,  its  Affiliates  and their  respective  officers,
directors, partners and members (collectively, the "Company Indemnitees"),  from
and against any and all Damages, and agrees to reimburse the Company Indemnitees
for reasonable all  out-of-pocket  expenses  (including the reasonable  fees and
expenses  of legal  counsel),  in each case  promptly as incurred by the Company
Indemnitees and to the extent arising out of or in connection with:

                                       17
<PAGE>

(i)      any  misrepresentation,  omission  of  fact,  or  breach  of any of the
         Investor's  representations or warranties  contained in this Agreement,
         the annexes, schedules or exhibits hereto or any instrument,  agreement
         or  certificate  entered into or delivered by the Investor  pursuant to
         this Agreement.

(ii)     any failure by the Investor to perform in any  material  respect any of
         its covenants,  agreements,  undertakings  or obligations  set forth in
         this  Agreement,  the  annexes,  schedules  or  exhibits  hereto or any
         instrument,  agreement or certificate  entered into or delivered by the
         Investors pursuant to this Agreement; or

(iii)    any action instituted against the Company by any stockholder, member or
         partner of the Investor who is not an Affiliate of the  Investor,  with
         respect to any of the transactions contemplated by this Agreement.

Section 7.3.  Notice.  Promptly  after  receipt by either  party hereto  seeking
indemnification  pursuant  to Section  7.2 (an  "Indemnified  Party") of written
notice of any  investigation,  claim,  proceeding  or other action in respect of
which  indemnification is being sought (each, a "Claim"),  the Indemnified Party
promptly  shall notify the party from whom  indemnification  pursuant to Section
7.2 is being sought (the "Indemnifying  Party") of the commencement thereof; but
the omission so to notify the  Indemnifying  Party shall not relieve it from any
liability  that it otherwise may have to the  Indemnified  Party,  except to the
extent that the  Indemnifying  Party is actually  prejudiced by such omission or
delay. In connection with any Claim as to which both the Indemnifying  Party and
the Indemnified Party are parties,  the Indemnifying  Party shall be entitled to
assume the defense thereof. Notwithstanding the assumption of the defense of any
Claim by the Indemnifying  Party, the Indemnified  Party shall have the right to
employ  separate  legal counsel and to participate in the defense of such Claim,
and the Indemnifying Party shall bear the reasonable fees,  out-of-pocket  costs
and expenses of such  separate  legal counsel to the  Indemnified  Party if (and
only if):  (x) the  Indemnifying  Party  shall  have  agreed  to pay such  fees,
out-of-pocket  costs and expenses,  (y) the Indemnified  Party  reasonably shall
have concluded that representation of the Indemnified Party and the Indemnifying
Party by the same legal  counsel would not be  appropriate  due to actual or, as
reasonably  determined by legal counsel to the  Indemnified  Party,  potentially
differing  interests  between such parties in the conduct of the defense of such
Claim, or if there may be legal defenses available to the Indemnified Party that
are in addition to or disparate from those available to the Indemnifying  Party,
or (z) the  Indemnifying  Party  shall  have  failed  to  employ  legal  counsel
reasonably  satisfactory to the Indemnified  Party within a reasonable period of
time after notice of the  commencement of such Claim.  If the Indemnified  Party
employs  separate  legal  counsel in  circumstances  other than as  described in
clauses  (x),  (y) or (z)  above,  the fees,  costs and  expenses  of such legal
counsel shall be borne exclusively by the Indemnified Party.  Except as provided
above,  the  Indemnifying  Party shall not, in connection  with any Claim in the
same jurisdiction,  be liable for the fees and expenses of more than one firm of
legal  counsel  for the  Indemnified  Party  (together  with  appropriate  local
counsel). The Indemnifying Party shall not, without the prior written consent of
the Indemnified Party (which consent shall not unreasonably be withheld), settle
or  compromise  any Claim or consent to the entry of any judgment  that does not
include an unconditional  release of the Indemnified  Party from all liabilities
with respect to such Claim or judgment.

                                       18
<PAGE>

Section 7.4. Direct Claims. In the event one party hereunder should have a claim
for indemnification  that does not involve a claim or demand being asserted by a
third party,  the Indemnified  Party promptly shall deliver notice of such claim
to the  Indemnifying  Party. If the Indemnified  Party disputes the claim,  such
dispute shall be resolved by mutual  agreement of the Indemnified  Party and the
Indemnifying  Party or by binding  arbitration  conducted in accordance with the
procedures  and rules of the American  Arbitration  Association  as set forth in
Article X. Judgment upon any award rendered by any arbitrators may be entered in
any court having competent jurisdiction thereof.

                                  ARTICLE VIII

         Due Diligence Review; Non-Disclosure of Non-Public Information.

Section 8.1. Due  Diligence  Review.  Subject to Section 8.2, the Company  shall
make  available  for  inspection  and review by the  Investors,  advisors to and
representatives  of the  Investors  (who may or may not be  affiliated  with the
Investors and who are  reasonably  acceptable to the Company),  any  underwriter
participating in any disposition of the Registrable  Securities on behalf of the
Investors  pursuant  to  the  Registration  Statement,   any  such  registration
statement or amendment or supplement thereto or any blue sky, OTC Bulletin Board
or other filing, all SEC Documents and other filings with the SEC, and all other
publicly available  corporate  documents and properties of the Company as may be
reasonably  necessary  for the purpose of such review,  and cause the  Company's
officers,  directors  and  employees  to  supply  all  such  publicly  available
information  reasonably  requested by the Investors or any such  representative,
advisor  or  underwriter  in  connection   with  such   Registration   Statement
(including, without limitation, in response to all questions and other inquiries
reasonably  made or  submitted  by any of them),  prior to and from time to time
after the filing and  effectiveness of the  Registration  Statement for the sole
purpose  of  enabling  the  Investors  and such  representatives,  advisors  and
underwriters and their  respective  accountants and attorneys to conduct initial
and ongoing due  diligence  with  respect to the Company and the accuracy of the
Registration Statement.

Section 8.2.      Non-Disclosure of Non-Public Information.

(a) The  Company  shall not  disclose  material  non-public  information  to the
Investors,  advisors to or  representatives  of the  Investors  unless  prior to
disclosure of such information the Company  identifies such information as being
non-public   information   and  provides  the   Investors,   such  advisors  and
representatives  with the  opportunity  to  accept  or  refuse  to  accept  such
non-public  information for review. Other than disclosure of any comment letters
received  from the SEC staff with  respect to the  Registration  Statement,  the
Company may, as a condition to disclosing any non-public  information hereunder,
require  the   Investors'   advisors  and   representatives   to  enter  into  a
confidentiality  agreement in form and content  reasonably  satisfactory  to the
Company and the Investors.

                                       19
<PAGE>

(b) Nothing  herein shall  require the Company to disclose  material  non-public
information  to the  Investors  or their  advisors or  representatives,  and the
Company represents that it does not disseminate material non-public  information
to any  investors  who purchase  stock in the Company in a public  offering,  to
money   managers   or  to   securities   analysts,   provided,   however,   that
notwithstanding   anything  herein  to  the  contrary,   the  Company  will,  as
hereinabove  provided,  promptly notify the advisors and  representatives of the
Investors  and,  if any,  underwriters,  of any  event or the  existence  of any
circumstance   (without  any  obligation  to  disclose  the  specific  event  or
circumstance)  of which  it  becomes  aware,  constituting  material  non-public
information  (whether or not requested of the Company  specifically or generally
during the course of due diligence by such persons or entities),  which,  if not
disclosed in the prospectus  included in the Registration  Statement would cause
such  prospectus to include a material  misstatement  or to omit a material fact
required to be stated therein in order to make the statements,  therein in light
of the circumstances in which they were made, not misleading.  Nothing contained
in this  Section 8.2 shall be  construed  to mean that such  persons or entities
other than the Investors  (without the written consent of the Investors prior to
disclosure of such  information  as set forth in Section  8.2(a)) may not obtain
non-public  information  in the course of conducting due diligence in accordance
with the terms of this  Agreement  and  nothing  herein  shall  prevent any such
persons or entities  from  notifying  the Company of their opinion that based on
such due diligence by such persons or entities,  that the Registration Statement
contains  an  untrue  statement  of a  material  fact or omits a  material  fact
required to be stated in the  Registration  Statement  or  necessary to make the
statements  contained therein,  in light of the circumstances in which they were
made, not misleading.

                                   ARTICLE IX

                      Legends; Transfer Agent Instructions

Section 9.1.  Legends.   Unless  otherwise   provided  below,  each  certificate
representing Registrable Securities will bear the following legend or equivalent
(the "Legend"):

THE SECURITIES  EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
U.S.  SECURITIES ACT OF 1933, AS AMENDED (THE  "SECURITIES  ACT"),  OR ANY OTHER
APPLICABLE  SECURITIES  LAWS AND HAVE BEEN ISSUED IN RELIANCE  UPON AN EXEMPTION
FROM  THE  REGISTRATION  REQUIREMENTS  OF THE  SECURITIES  ACT  AND  SUCH  OTHER
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION  HEREIN
MAY BE SOLD, ASSIGNED,  TRANSFERRED,  PLEDGED, ENCUMBERED, OR OTHERWISE DISPOSED
OF, EXCEPT PURSUANT TO AN EFFECTIVE  REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO A TRANSACTION THAT IS EXEMPT FROM SUCH REGISTRATION.

Section  9.2.  Transfer  Agent  Instructions.  Upon the  execution  and delivery
hereof,  the Company is issuing to the transfer  agent for its Common Stock (and
to any  substitute or  replacement  transfer agent for its Common Stock upon the
Company's  appointment  of any such  substitute or replacement  transfer  agent)
instructions  substantially in the form of Exhibit F hereto.  Such  instructions
shall be  irrevocable  by the Company from and after the date hereof or from and
after the issuance thereof to any such substitute or replacement transfer agent,
as the case may be.

                                       20
<PAGE>

Section 9.3. No Other  Legend or Stock  Transfer  Restrictions.  No legend other
than the one  specified  in Section 9.1 has been or shall be placed on the share
certificates  representing  the  Registrable  Securities and no  instructions or
"stop transfer  orders," "stock transfer  restrictions,"  or other  restrictions
have been or shall be given to the Company's transfer agent with respect thereto
other than as expressly set forth in this Article IX.

Section 9.4.  Investors' Compliance. Nothing in this Article shall affect in any
way each  Investor's  obligations to comply with all applicable  securities laws
upon resale of the Common Stock.

                                   ARTICLE X

                           Choice of Law; Arbitration

Section 10.1. Governing Law/Arbitration. This Agreement shall be governed by and
construed in  accordance  with the laws of the State of New York  applicable  to
contracts  made in New York by persons  domiciled  in New York City and  without
regard to its  principles of conflicts of laws. Any dispute under this Agreement
shall be submitted to  arbitration  under the American  Arbitration  Association
(the "AAA") in New York City,  New York,  and shall be finally and  conclusively
determined  by the decision of a board of  arbitration  consisting  of three (3)
members  (hereinafter  referred  to as  the  "Board  of  Arbitration")  selected
according to the rules governing the AAA. The Board of Arbitration shall meet on
consecutive business days in New York City, New York, and shall reach and render
a decision in writing (concurred in by a majority of the members of the Board of
Arbitration)  with  respect to the  amount,  if any,  which the losing  party is
required to pay to the other party in respect of a claim  filed.  In  connection
with  rendering its decisions,  the Board of Arbitration  shall adopt and follow
the laws of the State of New York unless the matter at issue is the  corporation
law of the company's state of incorporation,  in which event the corporation law
of such jurisdiction shall govern such issue. To the extent practical, decisions
of the Board of Arbitration  shall be rendered no more than thirty (30) calendar
days following  commencement of proceedings with respect  thereto.  The Board of
Arbitration  shall cause its written  decision  to be  delivered  to all parties
involved in the dispute.  Any decision made by the Board of Arbitration  (either
prior to or after the  expiration of such thirty (30) calendar day period) shall
be final,  binding and conclusive on the parties to the dispute, and entitled to
be enforced to the fullest  extent  permitted by law and entered in any court of
competent  jurisdiction.  The Board of  Arbitration  shall be authorized  and is
hereby  directed  to enter a  default  judgment  against  any party  failing  to
participate in any proceeding hereunder within the time periods set forth in the
AAA rules.  The  non-prevailing  party to any  arbitration (as determined by the
Board of Arbitration) shall pay the expenses of the prevailing party,  including
reasonable attorney's fees, in connection with such arbitration. Any party shall
be  entitled  to obtain  injunctive  relief  from a court in any case where such
relief  is  available,  and the  non-prevailing  party  to any  such  injunctive
proceeding shall pay the expenses of the prevailing party,  including reasonable
attorney's fees, in connection with such proceeding.

                                       21
<PAGE>

                                   ARTICLE XI

                                   Assignment

Section 11.1. Assignment. Neither this Agreement nor any rights of the Investors
or the Company  hereunder  may be assigned by either party to any other  person.
Notwithstanding the foregoing,  (a) the provisions of this Agreement shall inure
to the  benefit  of, and be  enforceable  by, any  permitted  transferee  of the
Convertible  Debentures  or any of the  Warrants  purchased  or  acquired by any
Investor  hereunder with respect to the Convertible  Debentures or Warrants held
by such person,  and (b) upon the prior  written  consent of the Company,  which
consent shall not unreasonably be withheld or delayed,  each Investor's interest
in this Agreement may be assigned at any time, in whole or in part, to any other
person or entity  (including  any  Affiliate of the Investor) who agrees to make
the representations and warranties contained in Article III and who agrees to be
bound by the terms of this Agreement.

                                  ARTICLE XII

                                     Notices

Section 12.1. Notices. All notices, demands, requests, consents,  approvals, and
other  communications  required or permitted  hereunder shall be in writing and,
unless otherwise specified herein,  shall be (i) hand delivered,  (ii) deposited
in the mail, registered or certified, return receipt requested, postage prepaid,
(iii) delivered by reputable air courier service with charges  prepaid,  or (iv)
transmitted by facsimile,  addressed as set forth below or to such other address
as such party shall have specified most recently by written  notice.  Any notice
or other  communication  required or  permitted to be given  hereunder  shall be
deemed effective (a) upon hand delivery or delivery by facsimile,  with accurate
confirmation  generated by the transmitting facsimile machine, 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 first  business  day
following  the date of sending by  reputable  courier  service,  fully  prepaid,
addressed  to such  address,  or (c) upon  actual  receipt of such  mailing,  if
mailed. The addresses for such communications shall be:

                                       22
<PAGE>

If to the Company:                    Mr. Edward P. Sutherland
                                      Medisys Technologies, Inc.
                                      144 Napoleon St.
                                      Baton Rouge, LA 70802
                                      Telephone:  (225) 343-8022
                                      Facsimile:  (225) 343-8023

with a copy to:                       Leonard E. Neilson, Esq.
(shall not constitute notice)         1121 East 3900 South, Suite C-200
                                      Salt Lake City, UT  84124
                                      Telephone: (801) 228-2855
                                      Facsimile: (801) 288-2850

if to the Investors:                  As set forth on the signature pages hereto

with a copy to:                       Joseph A. Smith, Esq.
(shall not constitute notice)         Epstein Becker & Green, P.C.
                                      250 Park Avenue
                                      New York, New York
                                      Telephone: (212) 351-4500
                                      Facsimile: (212) 661-0989

Either party hereto may from time to time change its address or facsimile number
for notices  under this  Section 12.1 by giving  written  notice of such changed
address  or  facsimile  number to the other  party  hereto as  provided  in this
Section 12.1.

                                  ARTICLE XIII

                                  Miscellaneous

Section  13.1.Counterparts/   Facsimile/  Amendments.   This  Agreement  may  be
executed  in multiple  counterparts,  each of which may be executed by less than
all of the parties and shall be deemed to be an original  instrument which shall
be enforceable  against the parties actually executing such counterparts and all
of which  together  shall  constitute  one and the same  instrument.  Except  as
otherwise  stated  herein,  in  lieu  of the  original  documents,  a  facsimile
transmission  or  copy of the  original  documents  shall  be as  effective  and
enforceable  as the  original.  This  Agreement may be amended only by a writing
executed by all parties.

Section 13.2. Entire  Agreement.  This  Agreement,  the  agreements  attached as
Exhibits  hereto,  which  include,  but  are  not  limited  to  the  Convertible
Debentures,  the Warrants,  the Escrow  Agreement,  and the Registration  Rights
Agreement,  set forth the entire  agreement  and  understanding  of the  parties
relating  to  the  subject   matter   hereof  and   supersedes   all  prior  and
contemporaneous agreements, negotiations and understandings between the parties,
both oral and  written  relating  to the subject  matter  hereof.  The terms and
conditions  of all Exhibits to this  Agreement are  incorporated  herein by this
reference  and shall  constitute  part of this  Agreement  as is fully set forth
herein.

                                       23
<PAGE>

Section 13.3. Severability.  In the event that any  provision of this  Agreement
becomes or is  declared  by a court of  competent  jurisdiction  to be  illegal,
unenforceable  or void,  this Agreement  shall continue in full force and effect
without said provision;  provided that such severability shall be ineffective if
it materially changes the economic benefit of this Agreement to any party.

Section 13.4. Headings.  The  headings  used  in this  Agreement  are  used  for
convenience only and are not to be considered in construing or interpreting this
Agreement.  Section 13.5. Number and Gender.  There may be one or more Investors
parties to this  Agreement,  which Investors may be natural persons or entities.
All references to plural  Investors  shall apply equally to a single Investor if
there is only one  Investor,  and all  references  to an  Investor as "it" shall
apply equally to a natural person.

Section 13.6. Reporting Entity for the Common Stock. The reporting entity relied
upon for the  determination of the trading price or trading volume of the Common
Stock on any given  Trading  Day for the  purposes  of this  Agreement  shall be
Bloomberg,  L.P. or any successor  thereto.  The written  mutual  consent of the
Investors  and the  Company  shall be  required  to employ  any other  reporting
entity.

Section  13.7.Replacement  of   Certificates.   Upon  (i)  receipt  of  evidence
reasonably  satisfactory  to the  Company  of the loss,  theft,  destruction  or
mutilation of a certificate  representing  any Conversion  Shares or Warrants or
any Warrant  Shares and (ii) in the case of any such loss,  theft or destruction
of such  certificate,  upon  delivery  of an  indemnity  agreement  or  security
reasonably  satisfactory  in form to the  Company  (which  shall not include the
posting of any bond) or (iii) in the case of any such  mutilation,  on surrender
and  cancellation of such  certificate,  the Company at its expense will execute
and deliver, in lieu thereof, a new certificate of like tenor.

Section 13.8. Fees and Expenses. Each of the Company and the Investors agrees to
pay its own expenses  incident to the performance of its obligations  hereunder,
except that the Company shall issue seventy-five thousand (75,000) warrants in a
form identical to the Warrants of the Investors to Jesup & Lamont. Section 13.9.
Brokerage.  Each of the parties hereto represents that it has had no dealings in
connection  with this  transaction  with any  finder or broker  who will  demand
payment of any fee or commission from the other party except for Jesup & Lamont,
whose fee shall be paid by the  Company.  The  Company on the one hand,  and the
Investors,  on the other hand, agree to indemnify the other against and hold the
other  harmless from any and all  liabilities to any person  claiming  brokerage
commissions  or  finder's  fees on account of  services  purported  to have been
rendered on behalf of the  indemnifying  party in connection with this Agreement
or the transactions contemplated hereby.

Section 13.10.Publicity.  The  Company  agrees  that it will not issue any press
release or other public  announcement of the  transactions  contemplated by this
Agreement  without  the  prior  consent  of the  Investors,  which  shall not be
unreasonably  withheld  nor delayed by more than two

     (2)      Trading  Days from their  receipt  of such  proposed  release.  No
release shall name the Investors without their express consent.

                                       24
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by the undersigned, thereunto duly authorized, as of the date first set
forth above.

                                     MEDISYS TECHNOLOGIES, INC.

                                     By: /s/Edward P. Sutherland
                                         -----------------------
                                         Edward P. Sutherland, Chairman and CEO

  Address: c/o Ultrafinanz AG        Investor: AMRO International, S.A.
  Grossmuensterplatz 26
  Zurich CH-8022 Switzerland
  Fax: 011-411-262-5515
  Amount: $2,000,000                 By: /s/H. U. Bachofen
                                         -----------------
                                         H. U. Bachofen, Director

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