Document:

Exhibit
      4.2

     

    
      	
               

              WA-1

            	 	
               

              Warrant
                to Purchase

              **10,000,000**

              Shares
                of Common Stock

            

    

     

    THIS
      WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT
      HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
      STATE SECURITIES LAWS. NEITHER THIS WARRANT NOR SUCH SHARES OF COMMON STOCK
      MAY
      BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
      EFFECTIVE REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND ANY APPLICABLE
      STATE SECURITIES LAW OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
      ISSUING CORPORATION THAT SUCH REGISTRATION IS NOT
      REQUIRED.

     

    Void
      after 5:30 P.M. New York City time on November 7, 2010

     

    SERIES
      A COMMON STOCK PURCHASE WARRANT

     

    OF

     

    GENESIS
      PHARMACEUTICALS ENTERPRISES, INC.

     

    This
      is
      to certify that, FOR VALUE RECEIVED, Pope Investments, LLC, a Delaware limited
      liability company, or registered assigns (“Holder”), is entitled to purchase, on
      the terms and subject to the provisions of this Warrant, from Genesis
      Pharmaceuticals Enterprises, Inc., a Florida corporation (the “Company”), at an
      exercise price (the “Exercise Price”) of thirty two cents ($0.32) per share, ten
      million (10,000,000) shares of common stock, par value $.001 per share (“Common
      Stock”), of the Company at any time during the period (the “Exercise Period”)
      commencing on the date of this Warrant and ending at 5:30 P.M. New York City
      time, on November 7, 2010; provided, however, that if such date is a day on
      which banking institutions in the State of New York are authorized by law to
      close, then on the next succeeding day which such banks are not authorized
      to
      close. The number of shares of Common Stock to be issued upon the exercise
      or
      conversion of this Warrant and the price to be paid for a share of Common Stock
      may be adjusted from time to time in the manner set forth in this Warrant.
      The
      shares of Common Stock deliverable upon such exercise or conversion, and as
      adjusted from time to time, are hereinafter sometimes referred to as “Warrant
      Shares,” and the exercise price for the purchase of a share of Common Stock
      pursuant to this Warrant in effect at any time, as the same may be adjusted
      from
      time to time, is hereinafter sometimes referred to as the “Exercise Price.” This
      Warrant was issued pursuant to a Securities Purchase Agreement (the “Purchase
      Agreement”) dated November 6, 2007, between the Company, the initial holder of
      this Warrant and the other investors named therein, and the holder of this
      Warrant is entitled to the benefits of the Purchase Agreement and the
      Registration Rights Agreement, as defined in the Purchase Agreement. The date
      of
      the initial issuance of this Warrant is the Closing Date under the Purchase
      Agreement. Reference in this Warrant to “all of the Warrants” or words of like
      import shall relate to all of the Series A Common Stock Purchase Warrants issued
      pursuant to the Purchase Agreement.

     

    1.     Exercise
      of Warrant.
      This
      Warrant may be exercised in whole at any time or in part from time to time
      during the Exercise Period by presentation and surrender hereof to the Company
      at its principal office, or at the office of its stock transfer agent, if any,
      with the Purchase Form annexed hereto duly executed and accompanied by payment
      of the Exercise Price for the number of shares of Common Stock specified in
      such
      form. Payment of the Exercise Price may be made either by check (subject to
      collection) or wire transfer in the amount of the Exercise Price. If this
      Warrant should be exercised in part only, the Company shall, upon surrender
      of
      this Warrant for cancellation, execute and deliver a new Warrant evidencing
      the
      rights of the Holder hereof to purchase the balance of the shares of Common
      Stock purchasable hereunder. Notwithstanding the foregoing, the holder of this
      Warrant shall not be required to physically deliver this Warrant upon exercise
      of this Warrant pursuant to this Section 1(a). Upon receipt by the Company
      of
      this Warrant at its office, or by the stock transfer agent of the Company at
      its
      office, in proper form for exercise, or upon delivery of the notice of exercise
      without delivery of this Warrant, the Holder shall be deemed to be the holder
      of
      record of the shares of Common Stock issuable upon such exercise,
      notwithstanding that the stock transfer books of the Company shall then be
      closed or that certificates representing such shares of Common Stock shall
      not
      then be actually delivered to the Holder.

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    2.     Reservation
      and Delivery of Shares.

     

    (a)     The
      Company hereby agrees that at all times there shall be reserved for issuance
      upon exercise of this Warrant such number of shares of Common Stock as shall
      be
      required for issuance and delivery upon exercise or conversion of this Warrant
      and that it shall not increase the par value of the Common Stock.

     

    (b)     Except
      as
      otherwise set forth herein, upon delivery of a completed Purchase Form
      accompanied, if the exercise is not a cashless exercise, by payment of the
      Exercise Price, not later than three (3) business days after the Exercise Date
      (such third day being the “Delivery Date”), the Company shall deliver to the
      Holder a certificate or certificates which, after the effective date of a
      registration statement covering the shares of Common Stock issuable upon
      exercise of this Warrant (the “Effective Date”), shall be free of restrictive
      legends and trading restrictions (other than those required by the Securities
      Act) representing the number of shares of Common Stock being acquired upon
      such
      exercise. If in the case of any exercise of this Warrant such certificate or
      certificates are not delivered to or as directed by the applicable Holder by
      the
      second day after the Delivery Date, the Holder shall be entitled to elect by
      written notice to the Company at any time on or before its receipt of such
      certificate or certificates thereafter, to rescind such conversion, in which
      event the conversion shall be deemed void ab initio.

     

    (c)     The
      Company’s obligations to issue and deliver the Common Stock upon exercise of
      this Warrant in accordance with the terms hereof are absolute and unconditional,
      irrespective of any action or inaction by the Holder to enforce the same, any
      waiver or consent with respect to any provision hereof, the recovery of any
      judgment against any Person or any action to enforce the same, or any setoff,
      counterclaim, recoupment, limitation or termination, or any breach or alleged
      breach by the Holder or any other Person of any obligation to the Company or
      any
      violation or alleged violation of law by the Holder or any other Person, and
      irrespective of any other circumstance which might otherwise limit such
      obligation of the Company to the Holder in connection with the issuance of
      such
      shares. In the event the Holder shall elect to exercise this Warrant in whole
      or
      in part, the Company may not refuse to effect such exercise based on any claim
      that the Holder or any one associated or affiliated with the Holder of has
      been
      engaged in any violation of law, agreement or for any other reason unless an
      injunction from a court, on notice, restraining and or enjoining such exercise
      shall have been sought and obtained and the Company posts a surety bond for
      the
      benefit of the Holder in the amount of 150% of the Value, which is subject
      to
      the injunction, which bond shall remain in effect until the completion of
      arbitration or litigation of the dispute and the proceeds of which shall be
      payable to the Holder to the extent it obtains judgment. In the absence of
      an
      injunction precluding the same, the Company shall issue the Common Stock upon
      a
      properly executed Purchase Form. 

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

    (d)     If
      the
      Company fails to deliver to the Holder such certificate or certificates pursuant
      to this Section 2(b) by the Delivery Date, and if after such Delivery Date
      the
      Holder purchases (in an open market transaction or otherwise) Common Stock
      to
      deliver in satisfaction of a sale by such Holder of the Common Stock which
      the
      Holder was entitled to receive upon the exercise relating to such Delivery
      Date
      (a “Buy-In”),
      then
      the Company shall pay in cash to the Holder the amount by which (a) the Holder’s
      total purchase price (including brokerage commissions, if any) for the Common
      Stock so purchased exceeds (i) the product of (x) the aggregate number of shares
      of Common Stock that such Holder was entitled to receive from the exercise
      at
      issue multiplied by (y) the price at which the sell order giving rise to such
      purchase obligation was executed. For example, if the Holder purchases Common
      Stock having a total purchase price of $11,000 to cover a Buy-In with respect
      to
      an attempted exercise of this Warrant with respect to which the aggregate sale
      price giving rise to such purchase obligation is $10,000, under the immediately
      preceding sentence the Company shall be required to pay the Holder $1,000.
      The
      Holder shall provide the Company written notice indicating the amounts payable
      to the Holder in respect of the Buy-In, together with applicable confirmations
      and other evidence reasonably requested by the Borrowers. Nothing in this
      Section 2(d) shall limit a Holder’s right to pursue any other remedies available
      to it hereunder, at law or in equity including, without limitation, a decree
      of
      specific performance and/or injunctive relief with respect to the Company’s
      failure to timely deliver certificates representing shares of Common Stock
      upon
      exercise of this Warrant pursuant to its terms.

     

    3.     Fractional
      Shares.
      No
      fractional shares or script representing fractional shares shall be issued
      upon
      the exercise of this Warrant. All fractional shares shall be carried forward
      and
      any fractional shares which remain after the Holder exercises this Warrant
      in
      full shall be dropped and eliminated.

     

    4.     Exchange,
      Transfer, Assignment or Loss of Warrant.
      This
      Warrant is exchangeable, without expense, at the option of the Holder, upon
      presentation and surrender hereof to the Company or at the office of its stock
      transfer agent, if any, for other Warrants of different denominations entitling
      the holder thereof to purchase in the aggregate the same number of shares of
      Common Stock purchasable hereunder. Subject to the provisions of Section 10
      of
      this Warrant, upon surrender of this Warrant to the Company or at the office
      of
      its stock transfer agent, if any, with the Assignment Form annexed hereto duly
      executed and funds sufficient to pay any transfer tax, the Company shall,
      without charge, execute and deliver a new Warrant in the name of the assignee
      named in such instrument of assignment and this Warrant shall promptly be
      canceled. This Warrant may be divided or combined with other Warrants which
      carry the same rights upon presentation hereof at the office of the Company
      or
      at the office of its stock transfer agent, if any, together with a written
      notice specifying the names and denominations in which new Warrants are to
      be
      issued and signed by the Holder hereof. The term “Warrant” as used herein
      includes any Warrants into which this Warrant may be divided or exchanged.
      Upon
      receipt by the Company of evidence satisfactory to it of the loss, theft,
      destruction or mutilation of this Warrant, and (in the case of loss, theft
      or
      destruction) of reasonably satisfactory indemnification, and upon surrender
      and
      cancellation of this Warrant, if mutilated, the Company will execute and deliver
      a new Warrant of like tenor. Any such new Warrant executed and delivered shall
      constitute an additional contractual obligation on the part of the Company,
      whether or not this Warrant so lost, stolen, destroyed, or mutilated shall
      be at
      any time enforceable by anyone.

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    5.     Rights
      of the Holder.
      The
      Holder shall not, by virtue of this Warrant, be entitled to any rights of a
      stockholder in the Company, either at law or equity, and the rights of the
      Holder are limited to those expressed in the Warrant, the Purchase Agreement
      and
      the Registration Rights Agreement and are not enforceable against the Company
      except to the extent set forth herein and therein.

     

    6.     Adjustments
      To Exercise Price.
      The
      Exercise Price in effect at any time and the number and kind of securities
      purchasable upon exercise of each Warrant shall be subject to adjustment as
      follows:

     

    (a)     In
      case
      the Company shall, subsequent to the date of the initial issuance of this
      Warrant, (i) pay a dividend or make a distribution on its shares of Common
      Stock
      in shares of Common Stock, (ii) subdivide or reclassify its outstanding Common
      Stock into a greater number of shares or otherwise effect a stock split or
      distribution, or (iii) combine or reclassify its outstanding Common Stock into
      a
      smaller number of shares or otherwise effect a reverse split, then,
      in
      each such event, the Exercise Price shall, simultaneously with the happening
      of
      such event, be adjusted by multiplying the then Exercise Price by a fraction,
      the numerator of which shall be the number of shares of Common Stock outstanding
      immediately prior to such event and the denominator of which shall be the number
      of shares of Common Stock outstanding immediately after such event, and the
      product so obtained shall thereafter be the Exercise Price then in effect.
      The
      Exercise Price, as so adjusted, shall be readjusted in the same manner upon
      the
      happening of any successive event or events described herein in this
      Section 6. 

     

    (b)     From
      and
      after the Closing Date and as long as this Warrant is outstanding, except for
      (a) Exempt Issuances, as defined in the Purchase Agreement, (b) issuances
      covered by this Section 6(b), or (c) an issuance of Common Stock upon exercise
      or upon conversion of warrants, options or other convertible securities for
      which an adjustment has already been made pursuant to this Section 6(b), as
      to
      all of which this Section 6(b) does not apply, if the Company closes on the
      sale
      or issuance of Common Stock at a price, or issues Convertible Securities with
      a
      Exercise Price or exercise price per share which is less than the Exercise
      Price
      then in effect (such lower sales price, conversion or exercise price, as the
      case may be, being referred to as the “Lower Price”), the Exercise Price shall
      be reduced to the Lower Price. For purpose of determining the exercise price
      of
      warrants issued by the Company, the price, if any, paid per share for the
      warrants shall be added to the exercise price of the warrants.

     

    (c)     The
      number of shares of Common Stock that the Holder of this Warrant shall
      thereafter, on the exercise hereof as provided in Section 1, be entitled to
      receive shall be adjusted to a number determined by multiplying the number
      of
      shares of Common Stock theretofore be issuable on such exercise by a fraction
      of
      which (a) the numerator is the old Exercise Price and (b) the
      denominator is the Exercise Price as adjusted. In
      no
      event shall the Exercise Price per share be less than the par value per share,
      and, if any adjustment made pursuant to said Section 6 would result in an
      Exercise Price which would be less than the par value per share, then, in such
      event, the Exercise Price per share shall be the par value per share; provided,
      however, that the limitation contained in this sentence shall not affect the
      number of shares of Common Stock issuable upon exercise or conversion of this
      Warrant.

     

    (d)     In
      the
      event that at any time, as a result of an adjustment made pursuant to this
      Section 6, the Holder of any Warrant thereafter shall become entitled to receive
      any shares of the Company, other than Common Stock, thereafter the number of
      such other shares so receivable upon exercise of any Warrant shall be subject
      to
      adjustment from time to time in a manner and on terms as nearly equivalent
      as
      practicable to the provisions with respect to the Common Stock contained in
      this
      Section 6.

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

    (e)     Irrespective
      of any adjustments in the Exercise Price or the number or kind of shares
      purchasable upon exercise of Warrants, Warrants theretofore or thereafter issued
      may continue to express the same price and number and kind of shares as are
      stated in this and similar Warrants initially issued by the
      Company.

     

    7.     Officer’s
      Certificate.
      Whenever the Exercise Price shall be adjusted as required by the provisions
      of
      Section 6 of this Warrant, the Company shall forthwith file in the custody
      of
      its Secretary or an Assistant Secretary at its principal office and with its
      stock transfer agent, if any, an officer’s certificate showing the adjusted
      Exercise Price and the adjusted number of shares of Common Stock issuable upon
      exercise of each Warrant, determined as herein provided, setting forth in
      reasonable detail the facts requiring such adjustment, including a statement
      of
      the number of additional shares of Common Stock, if any, and such other facts
      as
      shall be necessary to show the reason for and the manner of computing such
      adjustment. Each such officer’s certificate shall be made available at all
      reasonable times for inspection by the Holder, and the Company shall, forthwith
      after each such adjustment, mail, by certified mail, return receipt requested
      and by telecopier and e-mail, a copy of such certificate to the Holder at the
      Holder’s address set forth in the Company’s Warrant Register.

     

    8.     Notices
      To Warrant Holders.
      So long
      as this Warrant shall be outstanding, (a) if the Company shall pay any dividend
      or make any distribution upon Common Stock (other than a regular cash dividend
      payable out of retained earnings) or (b) if the Company shall offer to the
      holders of Common Stock for subscription or purchase by them any share of any
      class or any other rights or (c) if any capital reorganization of the Company,
      reclassification of the capital stock of the Company, consolidation or merger
      of
      the Company with or into another corporation, sale, lease or transfer of all
      or
      substantially all of the property and assets of the Company to another
      corporation, or voluntary or involuntary dissolution, liquidation or winding
      up
      of the Company shall be effected, then in any such case, the Company shall
      cause
      to be mailed by certified mail, return receipt requested, to the Holder, at
      least fifteen days prior to the date specified in clauses (i) and (ii), as
      the
      case may be, of this Section 8 a notice containing a brief description of the
      proposed action and stating the date on which (i) a record is to be taken for
      the purpose of such dividend, distribution or rights, or (ii) such
      reclassification, reorganization, consolidation, merger, conveyance, lease,
      dissolution, liquidation or winding up is to take place and the date, if any
      is
      to be fixed, as of which the holders of Common Stock or other securities shall
      receive cash or other property deliverable upon such reclassification,
      reorganization, consolidation, merger, conveyance, dissolution, liquidation
      or
      winding up.

     

    9.     Reclassification,
      Reorganization or Merger.
      In case
      of any reclassification, capital reorganization or other change of outstanding
      shares of Common Stock of the Company, or in case of any consolidation or merger
      of the Company with or into another corporation (other than a merger in which
      the Company is the continuing corporation and which does not result in any
      reclassification, capital reorganization or other change of outstanding shares
      of Common Stock of the class issuable upon exercise of this Warrant) or in
      case
      of any sale, lease or conveyance to another corporation of the property of
      the
      Company as an entirety, the Company shall, as a condition precedent to such
      transaction, cause effective provisions to be made so that the Holder shall
      have
      the right thereafter by exercising this Warrant, to purchase the kind and amount
      of shares of stock and other securities and property receivable upon such
      reclassification, capital reorganization and other change, consolidation,
      merger, sale or conveyance by a holder of the number of shares of Common Stock
      which might have been purchased upon exercise of this Warrant immediately prior
      to such reclassification, change, consolidation, merger, sale or conveyance.
      Any
      such provision shall include provision for adjustments which shall be as nearly
      equivalent as may be practicable to the adjustments provided for in this
      Warrant. The foregoing provisions of this Section 9 shall similarly apply to
      successive reclassifications, capital reorganizations and changes of shares
      of
      Common Stock and to successive consolidations, mergers, sales or conveyances.
      Notwithstanding the foregoing, in the event that, as a result of any merger,
      consolidation, sale of assets or similar transaction, all of the holders of
      Common Stock receive and are entitled to receive no consideration other than
      cash in respect of their shares of Common Stock, then, at the effective time
      of
      the transaction, the rights to purchase Common Stock pursuant to the Warrants
      shall terminate, and the holders of the Warrants shall, notwithstanding any
      other provisions of this Warrant, receive in respect of each Warrant to purchase
      one (1) share of Common Stock, upon presentation of the Warrant Certificate,
      the
      amount by which the consideration per share of Common Stock payable to the
      holders of Common Stock at such effective time exceeds the Exercise Price in
      effect on such effective date, without giving effect to the transaction;
      provided, however, that if such transaction would, but for this Section 9,
      result in a reduction in the Exercise Price pursuant to Section 6(c) of this
      Warrant, the Exercise Price shall be reduced to reflect that transaction. In
      the
      event that, in such a transaction, the value of the consideration to be received
      per share of Common Stock is equal to or less than the Exercise Price, the
      Warrants shall automatically terminate and no consideration will be paid with
      respect thereof.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

    10.     Transfer
      to Company with the Securities Act.

     

    (a)     The
      Holder of this Warrant shall be entitled to the benefits of the Registration
      Rights Agreement.

     

    (b)     This
      Warrant or the Warrant Shares or any other security issued or issuable upon
      exercise of this Warrant may not be sold or otherwise disposed of except
      pursuant to an effective registration statement under the Securities Act, or
      an
      exemption from the registration requirements of such Act.

     

    
      	 	 	 
	Dated
              as of November 7, 2007 	GENESIS PHARMACEUTICALS ENTERPRISES,
              INC.
	 
 	 
 	 
 
	
               

            	By:  	/s/ Cao
              Wubo 
	 	
              
Name:
              Cao Wubo
	 	Title:Chief
              Executive Officer

    

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    PURCHASE
      FORM

     

    

     

    Dated:                              
      , 20  

     

    
      	_____	
              The
                undersigned hereby irrevocably exercises this Warrant to the extent
                of
                purchasing _______ shares of Common Stock and hereby makes payment
                of
                $____________ in payment of the Exercise Price
                therefor.

            

    

     

     

    INSTRUCTIONS
      FOR REGISTRATION OF STOCK

     

    Name:______________________________________________________________________________
        

    (Please
      typewrite or print in block letters)

     

     

    Signature:___________________________________________
      

     

    Social
      Security or Employer Identification No.________________________

     

    ASSIGNMENT
      FORM

     

    FOR
      VALUE
      RECEIVED,_______________________________________________________

     

    hereby
      sells, assigns and transfer unto

     

    Name_________________________________________________________________________
      

    (Please
      typewrite or print in block letters)

     

    Address________________________________________________________________________
      

     

    Social
      Security or Employer Identification No._______________________ 

     

    The
      right
      to purchase Common Stock represented by this Warrant to the extent of
      _________shares as to which such right is exercisable and does hereby
      irrevocably constitute and appoint __________________ attorney to transfer
      the
      same on the books of the Company with full power of substitution.

     

    Dated:                
      , 20 

    

     

    Signature_________________________________________
      

     

    Signature
      Medallion Guaranteed:

     

    

    _________________________________________________
      

     

     

    -7-Unassociated Document

    Exhibit
      10.1

    

    SECURITIES
      PURCHASE AGREEMENT

    

    BETWEEN

    

    GENESIS
      PHARMACEUTICALS ENTERPRISES, INC.

    

    AND

    

    POPE
      INVESTMENTS, LLC

    

    AND

    

    THE
      OTHER INVESTORS NAMED HEREIN

    

    DATED

    

    November
      6, 2007

    

    
      
        
        

      

      
        

        
          

        

      

      
        
        

      

    

     

    SECURITIES
      PURCHASE AGREEMENT

     

    This
      SECURITIES PURCHASE AGREEMENT (the “Agreement”)
      is
      made and entered into as of the 6th
      day of
      November, 2007, between Genesis
      Pharmaceuticals Enterprises, Inc.,
      a
      Florida corporation (the “Company”), and Pope
      Investments, LLC, a
      Delaware limited liability company (“Pope”),
      and
      any other investors named on the signature page of this Agreement (together
      with
      Pope, the “Investors”
and
      each an “Investor”).

     

    RECITALS:

     

    WHEREAS,
      the
      Investors wish to purchase from the Company, upon the terms and subject to
      the
      conditions of this Agreement, for the Purchase Price, as hereinafter defined,
      (a) the Company’s 6% convertible subordinated debentures due November 30, 2010
      in the principal amount of $5,000,000, and (b) common stock purchase warrants
      (the “Warrants”)
      to
      purchase 10,000,000 shares of Common Stock at $.32 per share; and 

     

    WHEREAS,
      each
      Investor is purchasing a Debenture and Warrants in the amounts set forth in
      Schedule A of this Agreement; and

     

      
      WHEREAS,
      the
      parties intend to memorialize the terms on which the Company will sell to the
      Investors and the Investors will purchase the Securities;

    

       
      NOW, THEREFORE,
      in
      consideration of the mutual covenants and premises contained herein, and for
      other good and valuable consideration, the receipt and adequacy of which are
      hereby conclusively acknowledged, the parties hereto, intending to be legally
      bound, agree as follows:

    

    Article
      1

     

    DEFINITIONS

     

    1.1     Certain
      Definitions.
      For
      purposes of this Agreement, the following capitalized terms shall have the
      following meanings (all capitalized terms used in this Agreement that are not
      defined in this Article 1 shall have the meanings set forth elsewhere in this
      Agreement):

     

    1.1.1     “Affiliate”
means
      a
      Person or Persons directly or indirectly, through one or more intermediaries,
      controlling, controlled by or under common control with the Person(s) in
      question. The term “control,” as used in the immediately preceding sentence,
      means, with respect to a Person that is a corporation, the right to the
      exercise, directly or indirectly, of more than 50% of the voting rights
      attributable to the shares of such controlled corporation and, with respect
      to a
      Person that is not a corporation, the possession, directly or indirectly, of
      the
      power to direct or cause the direction of the management or policies of such
      controlled Person.

     

    1.1.2     “Articles”
means
      the articles of incorporation of the Company, as the same may be amended from
      time to time. 

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 1

        
          

        

      

      
        
        

      

    

    1.1.3     “Authorized
      Stock Proviso”
has
      the
      meaning set forth in Section 4.4.3 of this Agreement.

     

    1.1.4     “Bylaws”
means
      the bylaws of the Company, as the same may be amended from time to
      time.

     

    1.1.5     “Closing” means
      the
      consummation of the transactions contemplated by this Agreement, all of which
      transactions shall be consummated contemporaneously with the
      Closing.

     

    1.1.6     “Closing
      Date”
means
      the date on which the Closing occurs.

     

    1.1.7     “Closing
      Escrow Agreement”
shall
      mean the agreement between the Company, the Investors and the Escrow Agent
      pursuant to which securities are deposited into escrow to be held as provided
      in
      Section 6 of this Agreement. The Closing Escrow Agreement shall be in
      substantially the form of Exhibit
      A
      to this
      Agreement.

     

    1.1.8     “Common
      Stock”
means
      the Company’s common stock, which is presently designated as the common stock,
      par value $.001 per share.

     

    1.1.9     “Company’s
      Governing Documents”
means
      the Articles and Bylaws.

     

    1.1.10     “Convertible
      Securities”
means
      all equity and debt securities and all options, warrants, rights or other
      agreements or instruments upon the conversion or exercise of which shares of
      Common Stock may be issuable.

     

    1.1.11     “Debentures”
means
      the Company’s 6% Convertible Debentures due November 30, 2010, which shall be in
      substantially the form of Exhibit
      B
      to this
      Agreement.

     

    1.1.12     “Escrow
      Agent”
means
      Sichenzia Ross Friedman Ference LLP. 

     

    1.1.13     “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended, and the rules and regulations
      of the SEC thereunder.

     

    1.1.14     “Exempt
      Issuance”
means
      the issuance of (a) shares of Common Stock or options to employees, officers,
      directors of and consultants (other than consultants whose services relate
      to
      the raising of funds) of the Company pursuant to any stock or option plan that
      was or may be adopted by a majority of independent members of the Board of
      Directors of the Company or a majority of the members of a committee of
      independent directors established for such purpose, and approved by a majority
      of the Company’s stockholders; provided that (i) no options are granted at a
      price which is less than the fair market value on the date of grant and (ii)
      no
      more than such number of shares of Common Stock as represents 5% of the then
      outstanding shares of Common Stock shall be included in the definition of Exempt
      Issuances; (b) securities upon the exercise of or conversion of any securities
      issued hereunder and pursuant to the Registration Rights Agreement, the Warrants
      and the Certificate of Designation and any other options, warrants or
      convertible securities which are outstanding on the date hereof, and (c)
      securities issued pursuant to acquisitions, licensing agreements, or other
      strategic transactions, provided any such issuance shall only be to a Person
      which is, itself or through its subsidiaries, an operating company in a business
      which the Company’s board of directors believes is beneficial to the Company and
      in which the Company receives benefits in addition to the investment of funds,
      but shall not include a transaction in which the Company is issuing securities
      primarily for the purpose of raising capital or to an entity whose primary
      business is investing in securities.

     

    
      
        
        

      

      
        
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    1.1.15     “Florida
      Law”
shall
      mean the Florida Business Corporation Act.

     

    1.1.16     “GAAP”
means
      United States generally accepted accounting principles consistently
      applied.

     

    1.1.17     “Independent
      Director”
means
      a
      director who meets the requirements of an independent director under the rule
      of
      the Nasdaq Stock Market; provided, however, that if the Company’s Common Stock
      is listed on the New York or American Stock Exchange, the rules of such exchange
      shall apply.

     

    1.1.18     “Material
      Adverse Effect”
means
      any adverse effect on the business, operations, properties or financial
      condition of the Company or any of its Subsidiaries that is material and adverse
      to the Company and its Subsidiaries taken as a whole and/or any condition,
      circumstance, or situation that would prohibit or otherwise materially interfere
      with the ability of the Company or any Subsidiary to perform any of its material
      obligations under this Agreement, the Registration Rights Agreement or the
      Warrants or to perform its obligations under any other material agreement.
      

     

    1.1.19     “Net
      Income”
means
      the Company’s consolidated net income
      determined in accordance with GAAP, except that, (i) Net Income shall be
      determined before deducting (x) any expense arising from the issuance of the
      Debentures or the Warrants or the issuance of securities pursuant to this
      Agreement or the Registration Rights Agreement or any other Transaction Document
      or upon conversion of the Debentures or exercise of the Warrants or (y) similar
      expenses incurred in connection with any other financing permitted by this
      Agreement shall be excluded; (ii) any net gains from the sale of securities
      or
      resulting from the marking to market of securities owned by the Company shall
      be
      excluded, and (iii) any net loss from such sale or marking to market of such
      securities shall be included.

     

    1.1.20     “Net
      Income Per Share”
shall
      mean the Company’s Net Income Per Share on a diluted basis, calculated to the
      nearest tenth of a cent. For purposes of making this computation the number
      of
      shares used in the computation of diluted income per share pursuant to GAAP
      shall be used, except (a) shares of Common Stock which are held in escrow
      pursuant to Section 6.10 of this Agreement shall not be treated as outstanding
      and (b) shares of Common Stock which are issuable pursuant to any liquidated
      damages provisions of this Agreement or any of the Transaction Documents, shall
      not be deemed outstanding until an event occurs pursuant to which such shares
      are required to be issued and then only to the extent that shares are required
      to be issued.

     

    1.1.21     “Person”
means
      an individual, partnership, firm, limited liability company, trust, joint
      venture, association, corporation, or any other legal entity.

     

    1.1.22     “Proposed
      Financing”
shall
      have the meaning set forth in Section 6.8 of this Agreement.

     

    
      
        
        

      

      
        
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    1.1.23     “Purchase
      Price”
means
      the $5,000,000 to be paid by the Investors to the Company for the
      Securities.

     

    1.1.24     “Registration
      Rights Agreement”
means
      the registration rights agreement between the Investor and the Company in
      substantially the form of Exhibit
      C
      to this
      Agreement.

     

    1.1.25     “Registration
      Statement”
means
      the registration statement under the Securities Act to be filed with the SEC
      for
      the registration of the Shares pursuant to the Registration Rights
      Agreement.

     

    1.1.26     “Related
      Companies”
means
      Karmoya International Ltd., a British Virgin Island corporation (“Karmoya”),
      Union Well International Limited, a Cayman Islands company and wholly-owned
      subsidiary of Karmoya (“Union Well”), Genesis Jiangbo (Laiyang) Biotech
      Technologies Co., Ltd., a wholly-owned subsidiary of Union Well which is a
      wholly foreign owned enterprise organized under the laws of the PRC
      (“GJBT”),
      and
      Laiyang Jiangbo Pharmaceutical Co., Ltd. (“LJ”),
      a
      limited liability company organized under the laws of the PRC, each of Karmoya,
      Union Well, GJBT and LJ being referred to as a “Related
      Company.”

     

    1.1.27     “Restricted
      Stockholders”
shall
      have the meaning set forth in Section 6.11 of this Agreement.

     

    1.1.28     Restriction
      Termination Date”
shall
      mean the date on which the Investors shall have converted Debentures and
      exercised Warrants (other than Warrants that shall have expired unexercised)
      and
      sold 80% of the Total Shares.

     

    1.1.29     “Rule
      144”
      means
      Rule 144 of the SEC pursuant to the Securities Act, as the same may be amended
      from time to time.

     

    1.1.30     “Securities”
means
      the Debentures and the Warrants.

     

    1.1.31     “Securities
      Act”
means
      the Securities Act of 1933, as amended, and the rules and regulations of the
      SEC
      thereunder.

     

    1.1.32     “SEC”
means
      the Securities and Exchange Commission.

     

    1.1.33     “SEC
      Documents”
means,
      at any given time, the Company’s latest Form 10-K or Form 10-KSB and all Forms
      10-Q or 10-QSB and 8-K and all proxy statements or information statements filed
      between the date the most recent Form 10-K or Form 10-KSB was filed and the
      date
      as to which a determination is being made.

     

    1.1.34     “Shares”
means,
      collectively, the shares of Common Stock issued or issuable (i) upon conversion
      of the Debentures and (ii) upon exercise of the Warrants.

     

    1.1.35     “Subsequent
      Financing”
means
      any offer and sale of equity securities, including convertible securities,
      but
      excluding any financing which is incidental to a debt financing with a bank
      or
      other institutional lender.

     

    
      
        
        

      

      
        
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    1.1.36     “Subsidiary”
means
      an entity in which the Company and/or one or more other Subsidiaries directly
      or
      indirectly own either 50% of the voting rights or 50% of the equity
      interests.

     

    1.1.37     “Total
      Shares”
means
      the number of shares of Common Stock as are issuable upon conversion of the
      Debentures and exercise of the Warrants, such number to be determined as if
      the
      Debentures are never converted into shares of Common Stock and the Warrants
      are
      never exercised. Based on the initial conversion price of the Debentures of
      $0.25, the Total Shares shall be 30,000,000 shares of Common Stock. The number
      of Total Shares shall be adjusted to reflect any change in the conversion price
      of the Debentures or the number of shares issuable upon exercise of the
      Warrants. The “Total
      Conversion Shares”
are
      the
      total number of Shares which are issuable upon conversion of the Debentures
      that
      were issued on the Closing Date.

     

    1.1.38     “Transaction
      Documents”
means
      this Agreement, all Schedules and Exhibits attached hereto, the Debentures,
      the
      Warrants, the Registration Rights Agreement, the Closing Escrow Agreement and
      all other documents and instruments to be executed and delivered by the parties
      in order to consummate the transactions contemplated hereby.

     

    1.1.39     “Unsold
      Shares”
means
      share of Common Stock which either, as of the day on which a determination
      is
      being made, (a) were initially issued upon conversion of the Debentures and
      were
      not sold by the Investor or (b) were issuable upon conversion of outstanding
      Debentures which were issued at the Closing.

     

    1.1.40     “Warrants”
means
      the common stock purchase warrants in substantially the forms of Exhibit
      D
      to this
      Agreement.

     

    1.2     References.
      All
      references in this Agreement to “herein” or words of like effect, when referring
      to preamble, recitals, article and section numbers, schedules and exhibits
      shall
      refer to this Agreement unless otherwise stated.

     

    Article
      2

     

    SALE
      AND PURCHASE OF NOTES; PURCHASE PRICE

     

    Upon
      the
      terms and subject to the conditions set forth herein, and in accordance with
      applicable law, the Company agrees to sell to the Investors, and each Investor
      severally agrees to purchase from the Company, on the Closing Date, the
      principal amount of Debentures and the Warrants set forth after the Investor’s
      name on Schedule A to this Agreement for that portion of the Purchase Price
      as
      is set forth on said Schedule A. At or prior to the Closing, each Investor
      shall
      wire the Investor’s portion of the Purchase Price to the Escrow Agent, who shall
      release the Purchase Price to the Company upon receipt of instructions from
      the
      Investor and the Company as provided in the Escrow Agreement. The Company shall
      cause the Debentures and Warrants to be issued to the Investors upon the release
      of the Purchase Price to the Company by the Escrow Agent.

     

     

    
      
        
        

      

      
        
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            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
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      Article
        3

       

      CLOSING
        DATE AND DELIVERIES AT CLOSING

    

     

    3.1     Closing
      Date.
      The
      Closing of the transactions contemplated by this Agreement, unless expressly
      determined herein, shall be held at the offices of Sichenzia Ross Friedman
      Ference LLP, 61 Broadway, New York, New York 10006, at 2:00 P.M. local time,
      on
      the Closing Date or on such other date and at such other place as may be
      mutually agreed by the parties, including closing by facsimile with originals
      to
      follow. 

     

    3.2     Deliveries
      by the Company.
      In
      addition to and without limiting any other provision of this Agreement, the
      Company agrees to deliver, or cause to be delivered, to the Investors and the
      Escrow Agent, the following, unless waived by the Investors:

     

    (a) An
      executed Agreement with all exhibits and schedules attached hereto;

     

    (b) Debentures
      and Warrants in the names of the Investors for the number of amounts set forth
      in Schedule A to this Agreement;

     

    (c) The
      executed Registration Rights Agreement;

     

    (d) The
      executed Closing Escrow Agreement;

     

    (e) Certifications
      in form and substance acceptable to the Company and the Investors from any
      and
      all brokers or agents involved in the transactions contemplated hereby as to
      the
      amount of commission or compensation payable to such broker or agent as a result
      of the consummation of the transactions contemplated hereby;

     

    (f) Management
      letter from the Company’s registered independent accounting firm or confirmation
      from such firm that no such letter were issued in connection with the Company’s
      most recent audit;

     

    (g) Evidence
      of approval of the Transaction Documents and the transactions contemplated
      hereby and thereby by the Company’s Board of Directors;

     

    (h) Agreements
      from the Restricted Stockholders pursuant to Section 6.11 of this
      Agreement;

     

    (i) Good
      standing certificate from the Secretary of State of the State of
      Florida;

     

    (j) Copy
      of
      the Company’s Articles, as currently in effect, certified by the Secretary of
      State of the State of Florida.

     

    (k) An
      opinion from the Company’s counsel, concerning the Transaction Documents and the
      transactions contemplated hereby in form and substance reasonably acceptable
      to
      Investors;

     

    (l) An
      opinion from the Company’s PRC counsel that (i) each of the Related Companies is
      an independent legal person and none of them is exposed to liabilities incurred
      by the other party; (ii) the agreements between BJBT and LJ (the “PRC
      Agreements”)
      constitute valid and binding obligations of the parties to such agreements,
      (iii) each of the PRC Agreements and the rights and obligations of the parties
      thereto are enforceable and valid in accordance with the laws of the PRC; (iv)
      all corporate and other actions necessary for the execution and delivery of
      the
      Transaction Documents by (the entities agreeing to the put or guarantee) has
      been taken and such Transaction Documents constitute valid and binding
      obligations of the parties to such agreements and the rights and obligations
      of
      the parties thereto are enforceable and valid in accordance with the laws of
      the
      PRC

     

    
      
        
        

      

      
        
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    (m) The
      executed disbursement instructions pursuant to the Escrow Agreement;
      and

     

    (n) Such
      other documents or certificates as shall be reasonably requested by Investors
      or
      their counsel.

     

    3.3     Deliveries
      by Investors.
      In
      addition to and without limiting any other provision of this Agreement, the
      Investors agree to deliver, or cause to be delivered, to the Escrow Agent under
      the Escrow Agreement, the following: 

     

    (a) A
      deposit
      from each Investor as to the Investor’s portion of the Purchase
      Price;

     

    (b) The
      executed Agreement with all Exhibits and Schedules attached hereto;

     

    (c) The
      executed Registration Rights Agreement; 

     

    (d) The
      executed Closing Escrow Agreement;

     

    (e) The
      executed disbursement instructions pursuant to the Escrow Agreement;
      and

     

    (f) Such
      other documents or certificates as shall be reasonably requested by the Company
      or its counsel.

     

    3.4     Delivery
      of Original Documents.
      In the
      event any document provided to the other party in Paragraphs 3.2 and 3.3 herein
      are provided by facsimile, the party shall forward an original document to
      the
      other party within seven (7) business days.

     

    3.5     Further
      Assurances.
      The
      Company and each Investor shall, upon request, on or after the Closing Date,
      cooperate with each other (specifically, the Company shall cooperate with the
      Investors, and each Investor shall cooperate with the Company) by furnishing
      any
      additional information, executing and delivering any additional documents and/or
      other instruments and doing any and all such things as may be reasonably
      required by the parties or their counsel to consummate or otherwise implement
      the transactions contemplated by this Agreement. 

     

    Article
      4

     

    REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY 

     

    The
      Company represents and warrants to the Investors as of the date hereof and
      as of
      Closing Date (which warranties and representations shall survive the Closing
      regardless of any examinations, inspections, audits and other investigations
      the
      Investors have heretofore made or may hereinafter make with respect to such
      warranties and representations) as follows: 

     

    
      
        
        

      

      
        
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    4.1     Organization
      and Qualification.
      The
      Company, its Subsidiaries and the Related Companies are each duly organized,
      validly existing and in good standing under the laws of the their applicable
      jurisdictions, and each has the requisite corporate power and authority to
      own,
      lease and operate its properties and to carry on its business as it is now
      being
      conducted and is duly qualified to do business in any other jurisdiction by
      virtue of the nature of the businesses conducted by it or the ownership or
      leasing of its properties, except where the failure to be so qualified will
      not,
      when taken together with all other such failures, have a Material Adverse Effect
      on the business, operations, properties, assets, financial condition or results
      of operation of the Company and its Subsidiaries and Related Companies taken
      as
      a whole.

     

    4.2     Company’s
      Governing Documents.
      The
      complete and correct copies of the Company’s Governing Documents have been
      provided to the Investors, and the Governing Documents in such form are and
      shall be in full force and effect on the Closing Date.

     

    4.3     Capitalization.

     

    4.3.1     The
      authorized and outstanding capital stock of the Company as of the date of this
      Agreement and as adjusted to reflect the issuance and sale of the Securities
      pursuant to this Agreement is set forth in Schedule 4.3.l to this Agreement.
      Schedule 4.3.1 lists all shares and potentially dilutive events, including
      shares issuable pursuant to employment, consulting and other services
      agreements, acquisition agreements, options and equity-based incentive plans,
      Convertible Securities, financing or business relationships as well as each
      agreement, plan, arrangement or understanding pursuant to which any shares
      of
      any class of capital stock may be issued, a copy of each of which has been
      provided to the Investors.

     

    4.3.2     All
      of
      the issued and outstanding shares of capital stock and the shares of Common
      Stock issuable upon exercise or conversion of the Convertible Securities listed
      in Schedule 4.3.1 have been duly authorized and are or, when issued, will be
      validly issued, fully paid and non-assessable and free of preemptive rights.
      

     

    4.3.3     Except
      pursuant to this Agreement and as set forth in Schedule 4.3.1, there are not
      now
      outstanding any Convertible Securities or agreements, understandings or
      arrangements to which the Company is a party, or by which the Company is or
      may
      be bound, to issue additional shares of its capital stock or Convertible
      Securities.

     

    4.3.4     All
      of
      the Series B Convertible Preferred Stock has been converted into Common Stock,
      and the shares formerly designated as Series B Convertible Preferred Stock
      have
      become shares of Preferred Stock without designation as to series until so
      designated in the future by the Company’s board of directors.

     

    4.4     Authority.

     

    4.4.1     The
      Company and each Related Company joining this Agreement each has all requisite
      corporate power and authority to execute and deliver this Agreement, the
      Debentures and the Warrants, the shares of Common Stock issuable upon conversion
      of the Debentures or upon exercise of the Warrants, the Registration Rights
      Agreement, the Closing Escrow Agreement and any other Transaction Documents
      to
      which the Company or such Related Company is a party, to perform its obligations
      hereunder and thereunder and to consummate the transactions contemplated hereby
      and thereby. The execution and delivery of this Agreement, the execution of
      the
      Securities issuable pursuant to this Agreement and upon conversion of the
      Debentures and exercise of the Warrant, the Registration Rights Agreement,
      the
      Closing Escrow Agreement and any other Transaction Documents to which the
      Company is a party have been duly authorized by all necessary corporate action
      and no other corporate proceedings on the part of the Company is necessary
      to
      authorize this Agreement or to consummate the transactions contemplated hereby
      and thereby except as disclosed in this Agreement. This Agreement has been
      duly
      executed and delivered by the Company and each Related Company which is a party
      hereto, and constitutes the legal, valid and binding obligation of the Company
      and the Related Company which is a party hereto or to the Debenture, enforceable
      against the Company and the Related Company, as the case may be, in accordance
      with its terms, except as enforceability may be limited by bankruptcy,
      insolvency and other laws of general application affecting the enforcement
      of
      creditors’ rights and except that any the granting of equitable relief is in the
      discretion of the court.

     

    
      
        
        

      

      
        
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    4.4.2     The
      Debentures and the Warrants will, when issued pursuant to this Agreement, be
      the
      valid and binding obligations of the Company, enforceable in accordance with
      their respective terms, except as enforceability may be limited by bankruptcy,
      insolvency and other laws of general application affecting the enforcement
      of
      creditors’ rights and except that any the granting of equitable relief is in the
      discretion of the court. The Common Stock issuable upon conversion of the
      Debentures and exercise of the Warrants will, when so issued, be duly and
      validly authorized and issued, fully paid and non-assessable. All such
      Securities, when so issued, will be free and clear of all liens, charges,
      claims, options, pledges, restrictions, preemptive rights, rights of first
      refusal and encumbrances whatsoever (other than those incurred by the
      Investor).

     

    4.4.3     Notwithstanding
      any contrary representations and warranties, no
      representation is made with respect to the ability of any Investor to convert
      the Debentures or exercise any Warrant if and to the extent that the conversion
      price of the Debentures or the number of Shares issuable upon exercise of the
      Warrants would result in the issuance of a number of shares of Common Stock
      which is greater than the amount by which the authorized Common Stock exceeds
      the sum of the outstanding Common Stock and the shares of Common Stock reserved
      for issuance pursuant to outstanding agreements and outstanding Convertible
      Securities (the foregoing proviso being referred to as the “Authorized
      Stock Proviso”).

     

    4.4.4     Each
      of
      the Related Companies is legally established and validly existing as an
      independent legal entities; each of the Related Companies is an independent
      legal person and none of them is exposed to liabilities incurred by the other
      party; the PRC Agreements constitute valid and binding obligations of the
      parties to such agreements, and each of the PRC Agreements and the rights and
      obligations of the parties thereto are enforceable and valid in accordance
      with
      the laws of the PRC.

     

    4.5     No
      Conflict; Required Filings and Consents.
      Neither
      the execution and delivery of this Agreement by the Company or any Related
      Company whish is a party hereto, nor the issuance of the Securities as
      contemplated by this Agreement, nor any other Transaction Documents, nor the
      performance by the Company or any Related Company of its obligations hereunder
      and thereunder will: (i) conflict with or violate the Company’s or any
      Subsidiary’s or any Related Company’s Governing Instruments; (ii) conflict with,
      breach or violate any federal, state, foreign (including the Peoples’ Republic
      of China) or local law, statute, ordinance, rule, regulation, order, judgment
      or
      decree (collectively, “Laws”)
      in
      effect as of the date of this Agreement and applicable to the Company or any
      Subsidiary or any Related Company; or (iii) result in any breach of, constitute
      a default (or an event that with notice or lapse of time or both would become
      a
      default) under, give to any other entity any right of termination, amendment,
      acceleration or cancellation of, require payment under, or result in the
      creation of a lien or encumbrance on any of the properties or assets of the
      Company or any Subsidiary or any Related Company pursuant to, any note, bond,
      mortgage, indenture, contract, agreement, lease, license, permit, franchise
      or
      other instrument or obligation to which the Company or any Subsidiary or any
      Related Company is a party or by which the Company or any Subsidiary or Related
      Company or any of their respective properties or assets is bound, other than
      such violations, conflicts, breaches, defaults, terminations, accelerations
      or
      creations of liens that would not, in the aggregate, have a Material Adverse
      Effect
      except
      to the extent that stockholder approval may be required as a result of the
      Authorized Stock Proviso, in which event, the Company will seek stockholder
      approval to an increase in the authorized Common Stock sufficient to enable
      the
      Company to be in compliance with this Section 4.5.

     

    
      
        
        

      

      
        
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    4.6     Reports
      and Financial Statements.

     

    4.6.1 The
      consolidated financial statements of the Related Companies, for the years ended
      June 30, 2007 and 2006, including consolidated balance sheets, statements of
      operations, stockholders’ equity and cash flows, together with the notes
      thereon, certified by Moore Stephens Wurth Frazer and Torbet, LLP (“Moore
      Stephens”),
      the
      Company’s independent registered accounting firm have been delivered to the
      Investors. Each of the consolidated balance sheets fairly presents the financial
      position of the Related Companies, as of its date, and each of the consolidated
      statements of income, stockholders’ equity and cash flows (including any related
      notes and schedules thereto) fairly presents the results of operations, cash
      flows and changes in stockholders’ equity, as the case may be, of the Related
      Companies for the periods to which they relate, in each case in accordance
      with
      GAAP consistently applied during the periods involved. The Moore Stephens is
      independent as to the each of the Related Companies in accordance with the
      rules
      and regulations of the SEC. The books and records of the Related Companies
      have
      been, and are being, maintained in all material respects in accordance with
      GAAP
      and any other applicable legal and accounting requirements and reflect only
      actual transaction. None of the Related Companies has received any advice from
      the Moore Stephens to the effect that there is any significant deficiency or
      material weakness in its controls or recommending any corrective action on
      the
      part of any of the Related Companies. No Related Company has any contingent
      liability which is not reflected in the financial statements.

     

    4.6.2     The
      Company’s Form 10-KSB for the year ended September 30, 2006, contains the
      audited financial statements of the Company, certified by Sherb & Co., LLP,
      (“Sherb”),
      the
      Company’s independent registered accounting firm, and the Company’s Form 10-QSB
      for the quarter ended June 30, 2007 contains the unaudited financial statements
      of the Company, prior to its acquisition of Karmoya, which have been reviewed
      by
      Sherb. The balance sheets fairly present the financial position of the Company,
      as of their respective dates, and each of the consolidated statements of income,
      stockholders’ equity and cash flows (including any related notes and schedules
      thereto) fairly presents the results of operations, cash flows and changes
      in
      stockholders’ equity, as the case may be, of the Company for the periods to
      which they relate, in each case in accordance with GAAP consistently applied
      during the periods involved. Sherb is independent as to the Company in
      accordance with the rules and regulations of the SEC. The books and records
      of
      the Company have been, and are being, maintained in all material respects in
      accordance with GAAP and any other applicable legal and accounting requirements
      and reflect only actual transaction. The Company has not received any letters
      of
      comments from the SEC relating to any filing made by the Company with the SEC
      which has not been addressed by an amended filing, and each amended filing
      fully
      responds to the questions raised by the staff of the SEC. The Company maintains
      disclosure controls and procedures that are effective to ensure that information
      required to be disclosed by the Company in its annual and quarterly reports
      filed with the SEC is accumulated and communicated to the Company’s management,
      including its principal executive and financial officers as appropriate, to
      allow timely decisions regarding required disclosure. There were no significant
      changes in the Company’s internal controls or other factors that could
      significantly affect such controls subsequent to September 30, 2006. The Company
      has not received any advice from Sherb to the effect that there is any
      significant deficiency or material weakness in the Company’s controls or
      recommending any corrective action on the part of the Company or any Subsidiary.
      The Company does not have any contingent liabilities.

     

    
      
        
        

      

      
        
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    4.6.3     From
      June
      30, 2007 to the Closing Date, there shall be no significant changes in the
      Company’s consolidated balance sheet or any significant payments by the Company
      which are not reflected on the Company’s June 30, 2007 balance sheet filed with
      the Company’s Form 8-K on October 2, 2007. 

     

    4.7     Compliance
      with Applicable Laws.
      Neither
      the Company nor any Related Company is in violation of, or, to the knowledge
      of
      the Company is under investigation with respect to or has been given notice
      or
      has been charged with the violation of, any Law of a governmental agency, except
      for violations which individually or in the aggregate do not have a Material
      Adverse Effect. 

     

    4.8     Brokers.
      Except
      as set forth in Schedule 4.8, no broker, finder or investment banker is entitled
      to any brokerage, finder’s or other fee or commission in connection with the
      transactions contemplated by this Agreement based upon arrangements made by
      or
      on behalf of the Company.

     

    4.9     SEC
      Documents.
      The
      Investors acknowledge that the Company is a publicly held company and has made
      available to the Investors upon request true and complete copies of any
      requested SEC Documents. The Company’s Common Stock is registered pursuant to
      Section 12(d) of the Exchange Act. The Common Stock is quoted and traded on
      the
      OTC Bulletin Board of the National Association of Securities Dealers, Inc.
      The
      Company has received no notice, either oral or written, with respect to the
      continued quotation or trading of the Common Stock on the OTC Bulletin Board.
      The Company has not provided to any Investor 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
      requ    irements 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.

     

    4.10     Litigation.
      To the
      knowledge of the Company, no litigation, claim, or other proceeding before
      any
      court or governmental agency is pending or to the knowledge of the Company,
      threatened against the Company, any Subsidiary or any Related Company, the
      prosecution or outcome of which may have a Material Adverse Effect.

     

    
      
        
        

      

      
        
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    4.11     Exemption
      from Registration.
      Subject
      to the accuracy of the Investors’ representations in Article V of this
      Agreement, except as required pursuant to the Registration Rights Agreement,
      the
      sale of the Debentures and Warrants by the Company to the Investors will not
      require registration under the Securities Act. When issued upon conversion
      of
      the Debentures or upon exercise of the Warrants in accordance with their terms,
      the Shares will be duly and validly authorized and issued, fully paid, and
      non-assessable. The Company is issuing the Debentures and the Warrants in
      accordance with and in reliance upon the exemption from securities registration
      afforded, inter alia, by Rule 506 under Regulation D as promulgated by the
      SEC
      under the Securities Act, and/or Section 4(2) of the Securities Act; provided,
      that filings may be required pursuant to state securities or “blue sky” laws.
      The Company is not an investment company within the meaning of the Investment
      Companies Act of 1940.

     

    4.12     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 as
      promulgated by the SEC under the Securities Act) or general advertising with
      respect to the sale of the Securities, 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 Debentures, Common Stock or Warrants,
      under the Securities Act, except as required herein.

     

    4.13     No
      Material Adverse Effect.
      Since
      June 30, 2007, no event or circumstance resulting in a Material Adverse Effect
      has occurred or exists with respect to the Company or any Related Company.
      No
      material supplier or customer has given notice, oral or written, that it intends
      to cease or reduce the volume of its business with any Related Company from
      historical levels. Since June 30, 2007, no event or circumstance has occurred
      or
      exists with respect to any Related Company or their respective businesses,
      properties, prospects, operations or financial condition, that, under any
      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 writing to the Investor.

     

    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.

     

    4.15     Internal
      Controls And Procedures.
      The
      Company and each Related Company maintain books and records and internal
      accounting controls which provide reasonable assurance that (i) all transactions
      to which the Company or any Related Company is a party or by which their
      respective its properties are bound are executed with management’s
      authorization; (ii) the recorded accounting of the Company’s pr any Related
      Company’s consolidated assets is compared with existing assets at regular
      intervals; (iii) access to the Company’s and each Related Company’s consolidated
      assets is permitted only in accordance with management’s authorization; and (iv)
      all transactions to which the Company or any Related Company is a party or
      by
      which any of their respective properties are bound are recorded as necessary
      to
      permit preparation of their financial statements in accordance with
      GAAP.

     

    4.16     Full
      Disclosure.
      No
      representation or warranty made by the
      Company in
      this
      Agreement and no certificate or document furnished or to be furnished to the
      Investor pursuant to this Agreement contains or will contain any untrue
      statement of a material fact, or omits or will omit to state a material fact
      necessary to make the statements contained herein or therein not
      misleading.

     

    
      
        
        

      

      
        
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    Article
      5

     

    REPRESENTATIONS
      AND WARRANTIES OF THE INVESTORS

     

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

     

    5.1     Organization
      of the Investors.
      The
      state in which any offer to purchase shares hereunder was made or accepted
      by
      such Investor is the state shown as such Investor’s address. The Investor was
      not formed for the purpose of investing solely in the Securities. Any Investor
      that is a limited partnership, limited liability company, corporation, trust
      or
      other entity is duly organized, validly existing and in good standing under
      the
      laws of the state or other jurisdiction of its organization.

     

    5.2     Authorization
      and Power.
      The
      Investor has the requisite power and authority to enter into and perform this
      Agreement and to purchase the securities being sold to it hereunder. The
      execution, delivery and performance of this Agreement by the Investor and the
      consummation by the Investor of the transactions contemplated hereby have been
      duly authorized by all necessary partnership action where appropriate. This
      Agreement, the Registration Rights Agreement and the Closing Escrow Agreement
      have been duly executed and delivered by such Investor and at the Closing shall
      constitute valid and binding obligations of such Investor enforceable against
      the Investor in accordance with their terms, except as such enforceability
      may
      be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
      liquidation, conservatorship, receivership or similar laws relating to, or
      affecting generally the enforcement of, creditors’ rights and remedies or by
      other equitable principles of general application.

     

    5.3     No
      Conflicts.
      The
      execution, delivery and performance of this Agreement and the consummation
      by
      such Investor of the transactions contemplated hereby or relating hereto do
      not
      and will not (i) result in a violation of such Investor’s charter documents or
      bylaws where appropriate or (ii) conflict with, or constitute a default (or
      an
      event which with notice or lapse of time or both would become a default) under,
      or give to others any rights of termination, amendment, acceleration or
      cancellation of any agreement, indenture or instrument to which such Investor
      is
      a party, or result in a violation of any law, rule, or regulation, or any order,
      judgment or decree of any court or governmental agency applicable to such
      Investor or its properties (except for such conflicts, defaults and violations
      as would not, individually or in the aggregate, have a Material Adverse Effect
      on such Investor). The Investor is not required to obtain any consent,
      authorization or order of, or make any filing or registration with, any court
      or
      governmental agency in order for it to execute, deliver or perform any of such
      Investor’s obligations under this Agreement or to purchase the securities from
      the Company in accordance with the terms hereof, provided that for purposes
      of
      the representation made in this sentence, the Investor is assuming and relying
      upon the accuracy of the relevant representations and agreements of the Company
      herein.

     

    5.4     Financial
      Risks.
      Such
      Investor acknowledges that such Investor is able to bear the financial risks
      associated with an investment in the securities being purchased by such Investor
      from the Company and that it has been given full access to such records of
      the
      Company and its Subsidiaries and to the officers of the Company and its
      Subsidiaries as it has deemed necessary or appropriate to conduct its due
      diligence investigation. Such Investor is capable of evaluating the risks and
      merits of an investment in the securities being purchased by the Investor from
      the Company by virtue of its experience as an investor and its knowledge,
      experience, and sophistication in financial and business matters and the
      Investor is capable of bearing the entire loss of its investment in the
      securities being purchased by the Investor from the Company.

     

    
      
        
        

      

      
        
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    5.5     Accredited
      Investor.
      The
      Investor is (i) an “accredited investor” as that term is defined in Rule 501 of
      Regulation D promulgated under the Securities Act by reason of Rule 501(a)(3)
      and (6), (ii) experienced in making investments of the kind described in this
      Agreement and the related documents, (iii) able, by reason of the business
      and
      financial experience of its officers (if an entity) and professional advisors
      (who are not affiliated with or compensated in any way by the Company or any
      of
      its affiliates or selling agents), to protect its own interests in connection
      with the transactions described in this Agreement, and the related documents,
      and (iv) able to afford the entire loss of its investment in the securities
      being purchased by the Investor from the Company. 

     

    5.6     Brokers.
      No
      broker, finder or investment banker is entitled to any brokerage, finder’s or
      other fee or Commission in connection with the transactions contemplated by
      this
      Agreement based upon arrangements made by or on behalf of such Investor. Such
      Investor understands that any obligations under agreements or arrangements
      with
      brokers disclosed in Schedule 4.8 are obligations of the Company.

     

    5.7     Knowledge
      of Company.
      Such
      Investor and such Investor’s advisors, if any, have been, upon request,
      furnished with all materials relating to the business, finances and operations
      of the Company and materials relating to the offer and sale of the securities
      being purchased by such Investor from the Company. Such Investor and such
      Investor’s advisors, if any, have been afforded the opportunity to ask questions
      of the Company and have received complete and satisfactory answers to any such
      inquiries.

     

    5.8     Risk
      Factors.
      Each
      Investor understands that such Investor’s investment in the securities being
      purchased by such Investor from the Company involves a high degree of risk.
      Such
      Investor understands that no United States federal or state agency or any other
      government or governmental agency has passed on or made any recommendation
      or
      endorsement of the securities being purchased by the Investor from the Company.
      Such Investor warrants that such Investor is able to bear the complete loss
      of
      such Investor’s investment in the securities being purchased by the Investor
      from the Company.

     

    5.9     Full
      Disclosure.
      No
      representation or warranty made by such Investor in this Agreement and no
      certificate or document furnished or to be furnished to the Company pursuant
      to
      this Agreement contains or will contain any untrue statement of a material
      fact,
      or omits or will omit to state a material fact necessary to make the statements
      contained herein or therein not misleading. Except as set forth or referred
      to
      in this Agreement, Investor does not have any agreement or understanding with
      any person relating to acquiring, holding, voting or disposing of any equity
      securities of the Company.

     

    

    

    
      
        
        

      

      
        
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      Article
        6 

       

      COVENANTS
        OF THE COMPANY

    

     

    6.1     Registration
      Rights.
      The
      Company shall cause the Registration Rights Agreement to remain in full force
      and effect according to the provisions of the Registration Rights Agreement,
      and
      the Company shall comply in all material respects with the terms thereof. Except
      as set forth on Schedule 6.1 to this Agreement, (a) the Company does not have
      any agreement or obligation which would enable any Person to include securities
      in any registration statement required to be filed on behalf of the Investors
      pursuant to the Registration Rights Agreement and will not take any action
      which
      will give any Person any right to include securities in any such registration
      statement, (b) no Person has any demand or piggyback registration right with
      respect to any securities of the Company, and (c) the Company will not file
      any
      registration statement covering any shares of Common Stock issuable to any
      officers, directors, Affiliates of or consultants to the Company until the
      earlier of (a) one year from the effective date of the first registration
      statement filed pursuant to the Registration Rights Agreement or (b) the
      Restriction Termination Date; provided, however, that the Company may file
      a
      registration statement on Form S-8 for shares issued or issuable pursuant to
      employee stock option or long-term incentive plans for employees who are not
      officers, directors or Affiliates of the Company.

     

    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, such number
      of shares of Common Stock as may be issuable from time to time upon conversion
      of the Debentures and exercise of the Warrants.

     

    6.3     Compliance
      with Laws.
      The
      Company hereby agrees to comply in all respects with the Company’s reporting,
      filing and other obligations under the Laws.

     

    6.4     Exchange
      Act Registration.
      The
      Company will continue its obligation to report to the SEC under Section 15(d)
      of
      the Exchange Act and will, within ninety (90) days after the Closing, register
      the Common Stock under Section 12 of the Exchange Act and 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 any such registration or to terminate or suspend its
      reporting and filing obligations under the 1934 until the Investors have
      disposed of all of their Shares.

     

    6.5     Corporate
      Existence; No 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
      Transaction Documents.

     

    6.6     Listing,
      Securities Exchange Act of 1934 and Rule 144
      Requirements.
      The
      Company shall not take any action which would cause its Common Stock not to
      be
      traded on the OTC Bulletin Board, except that the Company may list the Common
      Stock on the Nasdaq Stock Market or the American or New York Stock Exchange
      if
      it meets the applicable listing requirements. The Company shall continue to
      maintain its status as a company registered under the Exchange Act. If, for
      any
      time after the Closing, the Company is no longer in compliance with this Section
      6.6, then the Company shall pay to the Investors as liquidated damages and
      not
      as a penalty, an amount equal to 10% per annum, based on the lesser of (a)
      the
      Purchase Price or (b) that percentage of the Purchase Price which the Unsold
      Shares bears to the number of shares of Total Conversion Shares. The liquidated
      damages shall be payable in cash or in Debentures, as the Company shall
      determine. Such
      damages shall be payable quarterly on the tenth (10th)
      day of
      the following calendar quarter, and shall cease at the time the Company begins
      complying with the provisions of this Section 6.6. 

     

    
      
        
        

      

      
        
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    6.7     Use
      of Proceeds.
      The
      Company will use the net proceeds from the sale of the Securities, after payment
      of legal fees and other closing costs, for working capital. 

     

    6.8     Right
      of First Refusal.

     

    6.8.1     From
      the
      Closing Date until one year after the effective date of the first registration
      statement filed pursuant to the Registration Rights Agreement (the “RFR
      Period”), in the event that the Company seeks to raise additional funds through
      a
      Subsequent Financing, regardless of whether the financing is initiated by the
      Company or an investor (a “Proposed
      Financing”),
      other
      than Exempt Issuances, the Investors shall have the right to participate in
      any
      subsequent funding by the Company as follows:

     

    6.8.2     With
      respect the first Proposed Financing during the RFR Period, the Investors,
      as a
      group, shall have the right to participate in the Proposed Financing on the
      same
      terms as other investors in the Proposed Financing, to the extent of up to
      50%
      of the total securities issued in the Proposed Financing. The Investors shall
      give the Company notice, within five business days of receipt of the proposed
      terms of the Proposed Financing, of their intention, subject to completion
      of
      their due diligence and negotiation and acceptance of final documentation,
      to
      participate in the Proposed Financing. If the gross proceeds raised in the
      first
      Proposed Financing during the RFR Period is less than $25,000,000, this Section
      6.8.2 shall apply to each Proposed Financing until that financing which brings
      the total gross proceeds raised during the RFR Period to
      $25,000,000.

     

    6.8.3     With
      respect to any Proposed Financing during the RFR Period subsequent to the last
      financing to which Section 6.8.2 applies, the Investors shall have the right
      to
      participate in the Proposed Financing on the same terms as other investors
      in
      the Proposed Financing, to the extent of the greater of (i) $5,000,000 or (ii)
      that percentage of the total purchase price of the securities issued in the
      Proposed Financing which would result in the Investors, as a group, owing the
      same percentage interest in the Company after the transaction as they owned
      prior to the transaction. Percentage ownership shall be determined in a manner
      consistent with Rule 13(d) of the Exchange Act.

     

    6.8.4     If
      the
      Investors elect to purchase securities in a Proposed Financing, they shall
      fund
      their purchase contemporaneously with the other investors and on the same terms
      and conditions as the other investors. The Investors may exercise this right
      in
      proportion to their respective purchases pursuant to this Agreement or in such
      other ratio as they may, among themselves, determine.

     

    6.8.5     In
      the
      event that the Investors do not exercise their right of participation the time
      limits set forth in Section 6.8.2 or Section 6.8.3 of this Agreement, the
      Company may sell the securities in the Proposed Financing at a price and on
      terms which are no more favorable to the purchasers than the terms provided
      to
      the Investors. If the Company subsequently changes the price or terms so that
      the price is more favorable to the purchasers or the terms are more favorable
      to
      the investors, the Company shall provide the Investors with the opportunity
      to
      purchase the securities on the revised terms in the manner set forth in this
      Section 6.8.
      

     

    
      
        
        

      

      
        
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    6.9     Price
      Adjustment.
      From
      the
      Closing Date until the Restriction Termination Date, except
      for Exempt Issuances, as to which this Section
      6.9
      does not
      apply, if the Company closes on the sale or issuance of Common Stock at a price,
      or Convertible Securities at an exercise or conversion price per
      share
      which is less than the Conversion Price, as defined in the Debentures, then
      in
      effect (such lower sales price, conversion or exercise price, as the case may
      be, being referred to as the “Lower Price”), the Conversion Price in effect from
      and after the date of such transaction shall be reduced to the Lower Price.
      For
      purpose of determining the exercise price of warrants issued by the Company,
      the
      price, if any, paid per share for the warrants shall be added to the exercise
      price of the warrants. A similar provision shall be included in the Warrants,
      and the number of shares issuable upon exercise of the Warrants shall be
      adjusted to reflect the reduced exercise price.

     

    6.10     Deliveries
      from Escrow Based on Net Income Per Share.

     

    6.10.1 At
      the
      Closing, pursuant to the Closing Escrow Agreement, the Company’s principal
      stockholder shall deliver to the Escrow Agent 20,000,000 shares of Common Stock,
      accompanied by a stock power executed in blank with signature medallion
      guaranteed which shall be replaced by shares issued by the Company in the name
      of the escrow agent. In
      the
      event the Company’s consolidated Net Income Per Share for the year ended June
      30, 2008 is less than $0.038, the Escrow Agent shall deliver the 20,000,000
      shares to the Investors in proportion to their respective percentages of the
      Purchase Price.

     

    6.10.2 The
      Company shall provide the Investors with a detailed schedule setting forth
      its
      computation of Net Income and Net Income Per Share. In the event that the
      parties shall fail to agree as to the computation of Net Income or Net Income
      Per Share and such failure cannot be resolved by negotiations between the
      Company and the Investors, either party shall have the right to submit the
      dispute to binding arbitration before an accounting firm which is a member
      of
      the PCAOB and which has an office in New York City. The arbitrator shall make
      a
      determination only as to the matters which are in dispute. The arbitrator shall
      be selected in accordance with the rules then obtaining of the American
      Arbitration Association in New York City. The Company and the Investors shall
      provide the arbitrator with information and support as to those items as to
      which they disagree. The decision of the arbitrator shall be final, binding
      and
      conclusive on the Company and the Investors, it being understood that the
      arbitrator shall have no authority to amend any provision of this Agreement.
      The
      arbitrator shall, upon making its determination, instruct the Escrow Agent
      as to
      the delivery of the shares held in escrow pursuant to Section
      6.10.1.

     

    6.11     Restrictions
      on Insider Selling.
      No
Restricted
      Stockholders may sell any shares of Common Stock in the public market prior
      to
      the earlier of one year from the Closing Date or the Restriction Termination
      Date. Restricted Stockholders shall mean any Person who is an officer, director
      or Affiliate of the Company or who becomes an officer or director of the Company
      subsequent to the Closing Date. Without
      limiting the generality of the foregoing, the Restricted Stockholders shall
      not
      to directly or indirectly offer to sell, grant an option for the purchase or
      sale of, transfer, pledge assign, hypothecate, distribute or otherwise encumber
      or dispose of any securities in the Company in a transaction which is not in
      the
      public market unless the transferee agrees to be bound by the provisions of
      this
      Section 6.11. The
      Company shall require any newly elected officer or director to agree to the
      restriction set forth in this Section 6.11. The restrictions in this Section
      6.11 shall not apply to shares issued pursuant to a stock option or long-term
      incentive plans which may be approved by the Compensation Committee provided
      that such committee is comprised of a majority of independent
      directors.

     

    
      
        
        

      

      
        
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    6.12     No
      Outside Interests.
      Until
      the Restriction Termination Date the Company’s chairman and chief executive
      officer will devote their full time and attention to the business of the Company
      and shall not have any business interests or activities other than
      as chairman or chief executive officer, as the case may be, except that
      he or she may devote time, which shall not be material and which shall not
      interfere with his or her duties as the Company’s chairman and chief
      executive officer, as the case may be, to personal passive investments and
      charitable and community activities. Furthermore, none of the Related Companies’
Stockholders shall have any interests or engage in any business which is
      directly or indirectly competitive with that of the Company or any Related
      Company until the Restriction Termination Date. 

     

    6.13     Payment
      of Due Diligence Expenses.
      At
      Closing the Escrow Agent shall disperse to Pope the sum of $20,000 for its
      legal
      and other expenses relating to the transactions contemplated by this
      Agreement.

     

    6.14     Compensation.
      The
      Company has previously provided the Investors with a schedule of present and
      proposed management compensation for the Company, its Subsidiaries and the
      Related Companies. Until one year from the effective date of the first
      registration statement filed pursuant to the Registration Rights Agreement
      or
      the Restriction Termination Date, the Company will not make, and will use its
      commercially reasonable best efforts to ensure that no Subsidiary or any Related
      Company make, any material changes in its executive compensation program or
      grant any loans or other extensions of credit to the executives of the Company,
      any Subsidiary or any Related Company without the prior consent of Pope;
      provided, however that nothing in this Section 6.14 shall be construed to
      authorize any loan, extension of credit or other transaction which is prohibited
      under applicable law.

     

    6.15     Rights
      of Access and Information.
      

     

    6.15.1 Until
      the
      Restriction Termination Date or such earlier date as Pope no longer owned
      Debentures in the principal amount of $1,500,000, the Company will concurrently
      furnish to Pope all material information provided generally to all shareholders
      (including but not limited to financial statements, details of material
      contracts, and acquisitions or disposals of material assets and public filings
      with the trading market on which any of the Company’s capital stock is traded
      and the relevant regulatory authorities, but excluding material that is filed
      with the SEC and included in the SEC’s EDGAR system). The Company will use its
      commercially reasonable efforts to provide Pope with access to the books and
      records of the Company during normal business hours and on reasonable notice,
      provided
      that
      access to communications between the Company and its subsidiaries with its
      attorneys need not be provided. The Company will also provide Pope with notice
      of meetings of the Company’s board of directors and will permit a representative
      of Pope to attend meetings.

     

    6.15.2 Information,
      financial statements and other documents provided to Pope or developed pursuant
      to Section 6.15.1 of this Agreement shall constitute the Company’s Confidential
      Information for the purposes of this Agreement. Pope agrees that it will keep
      confidential and will not disclose, divulge, or use for any purpose any
      Confidential Information obtained from the Company pursuant to the terms of
      this
      letter, unless such Confidential Information (a) is known or becomes known
      to
      the public in general (other than as a result of a breach of this Agreement
      by
      Pope), (b) is or has been independently developed or conceived by Pope without
      use of the Company’s confidential information, or (c) is or has been made known
      or disclosed to Pope by a third party without a breach of any obligation of
      confidentiality such third party may have to the Company; provided,
      however,
      that
      Pope may disclose confidential information to its attorneys, accountants,
      consultants, and other professionals to the extent necessary to obtain their
      services in connection with monitoring its investment in the Company. Pope
      understands that this confidential information constitutes material non-public
      information and Pope will not engage in any transactions in the Company’s
      securities while in possession of material non-public information (other than
      any transactions between Pope and the Company). The
      confidentiality obligations in this Section 6.15.2 will survive any termination
      of Pope’s rights pursuant to this Section 6.15.

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 18

        
          

        

      

      
        
        

      

    

    6.15.3 In
      the
      event that any Confidential Information is required to be produced by Pope
      pursuant to legal process or by request from an administrative agency, Pope
      shall give the Company notice of such legal process within a reasonable time,
      but not later than ten (10) business days prior to the date such disclosure
      is
      to be made, unless Pope has received less notice, in which event Pope shall
      notify the Company as promptly as practicable.  The Company shall have the
      right to object to any such disclosure, and if the Company objects (at the
      Company’s cost and expense) in a timely manner so that Pope is not subject to
      penalties for failure to make such disclosure, Pope shall not make any
      disclosure until there has been a court or administrative determination on
      the
      Company’s objections.  If disclosure is required by a court or
      administrative order, final beyond right of review, or if the Company does
      not
      object to the disclosure, Pope shall make disclosure only to the extent that,
      in
      the opinion of Pope’s counsel, disclosure is unequivocally required by the court
      or administrative order, and Pope will
      exercise reasonable efforts at the Company’s expense, to obtain reliable
      assurance that confidential treatment will be accorded the Confidential
      Information; Provided,
      however, that Pope shall not be required to give any notice which would be
      in
      violation of court order, administrative ruling or law.

     

    Article
      7 

     

    COVENANTS
      OF THE INVESTOR

     

    Each
      Investor, severally and not jointly, covenants and agrees with the Company
      as
      follows: 

     

    7.1     Compliance
      with Law.
      Each
      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 any public market
      on
      which the Company’s Common Stock is listed. 

     

    7.2     Transfer
      Restrictions. The
      Investors acknowledge that (a) the Debentures, Warrants and Shares underlying
      the Debentures and Warrants have not been registered under the provisions of
      the
      Securities Act, and may not be transferred unless (i) subsequently registered
      thereunder or (ii) the Investor shall have delivered to the Company an opinion
      of counsel, reasonably satisfactory in form, scope and substance to the Company,
      to the effect that the Debentures, Warrants and Shares underlying the Notes
      and
      Warrants to be sold or transferred may be sold or transferred pursuant to an
      exemption from such registration; and (b) any sale of the Shares underlying
      the
      Debentures and Warrants made in reliance on Rule 144 promulgated under the
      Securities Act may be made only in accordance with the terms of said Rule and
      further, if said Rule is not applicable, any resale of such securities under
      circumstances in which the seller, or the person through whom the sale is made,
      may be deemed to be an underwriter, as that term is used in the Securities
      Act,
      may require compliance with some other exemption under the Securities Act or
      the
      rules and regulations of the SEC thereunder. 

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 19

        
          

        

      

      
        
        

      

    

    7.3     Restrictive
      Legend. Each
      Investor acknowledges and agrees that the Securities and the Shares shall bear
      a
      restrictive legend and a stop-transfer order may be placed against transfer
      of
      any such Securities except that the requirement for a restrictive legend shall
      not apply to Shares sold pursuant to a current and effective registration
      statement or a sale pursuant Rule 144 or any successor rule.

     

    Article
      8 

     

    CONDITIONS
      PRECEDENT TO THE COMPANY’S OBLIGATIONS

     

    The
      obligation of the Company to consummate the transactions contemplated hereby
      shall be subject to the fulfillment, on or prior to Closing Date, of the
      following conditions in addition to the deliveries required by Section 3.3
      of
      this Agreement:

     

    8.1     No
      Termination.
      This
      Agreement shall not have been terminated pursuant to Article 10
      hereof.

     

    8.2     Representations
      True and Correct.
      The
      representations and warranties of the Investors contained in this Agreement
      shall be true and correct in all material respects on and as of the Closing
      Date
      with the same force and effect as if made on as of the Closing
      Date.

     

    8.3     Compliance
      with Covenants.
      The
      Investors shall have performed and complied in all material respects with all
      covenants, agreements, and conditions required by this Agreement to be performed
      or complied by it prior to or at the Closing Date.

     

    8.4     No
      Adverse Proceedings.
      On the
      Closing Date, no action or proceeding shall be pending by any public authority
      or individual or entity before any court or administrative body to restrain,
      enjoin, or otherwise prevent the consummation of this Agreement or the
      transactions contemplated hereby or to recover any damages or obtain other
      relief as a result of the transactions proposed hereby. 

     

    Article
      9 

     

    CONDITIONS
      PRECEDENT TO INVESTORS’ OBLIGATIONS

     

    The
      obligation of the Investors to consummate the transactions contemplated hereby
      shall be subject to the fulfillment, on or prior to Closing Date unless
      specified otherwise, of the following conditions in addition to the deliveries
      required by Section 3.2 of this Agreement:

     

    9.1     No
      Termination.
      This
      Agreement shall not have been terminated pursuant to Article 10
      hereof.

     

    9.2     Representations
      True and Correct.
      The
      representations and warranties of the Company contained in this Agreement shall
      be true and correct in all material respects on and as of the Closing Date
      with
      the same force and effect as if made on as of the Closing Date.

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 20

        
          

        

      

      
        
        

      

    

    9.3     Compliance
      with Covenants .
      The
      Company shall have performed and complied in all material respects with all
      covenants, agreements, and conditions required by this Agreement to be performed
      or complied by it prior to or at the Closing Date.

     

    9.4     No
      Adverse Proceedings.
      On the
      Closing Date, no action or proceeding shall be pending by any public authority
      or individual or entity before any court or administrative body to restrain,
      enjoin, or otherwise prevent the consummation of this Agreement or the
      transactions contemplated hereby or to recover any damages or obtain other
      relief as a result of the transactions proposed hereby.

     

    Article
      10  

     

    TERMINATION,
      AMENDMENT AND WAIVER

     

    10.1     Termination.
      This
      Agreement may be terminated at any time prior to the Closing Date

     

    10.1.1 by
      mutual
      written consent of the Investor and the Company;

     

    10.1.2 by
      the
      Company upon a material breach of any representation, warranty, covenant or
      agreement on the part of any Investor set forth in this Agreement, or any
      Investor upon a material breach of any representation, warranty, covenant or
      agreement on the part of the Company set forth in this Agreement, or if any
      representation or warranty of the Company or the Investor, respectively, shall
      have become untrue, in either case such that any of the conditions set forth
      in
      Article 8 or Article 9 hereof would not be satisfied (a “Terminating
      Breach”),
      and
      such breach shall, if capable of cure, not have been cured within five (5)
      business days after receipt by the party in breach of a notice from the
      non-breaching party setting forth in detail the nature of such
      breach.

     

    10.2     Effect
      of Termination.
      Except
      as otherwise provided herein, in the event of the termination of this Agreement
      pursuant to Section 10.1 hereof, there shall be no liability on the part of
      the
      Company or any Investor or any of their respective officers, directors, agents
      or other representatives and all rights and obligations of any party hereto
      shall cease; provided, that, in the event of a Terminating Breach, the breaching
      party shall be liable to the non-breaching party for all costs and expenses
      incurred by the non-breaching party, up to a maximum of $50,000.

     

    10.3     Amendment.
      This
      Agreement may be amended by the parties hereto any time prior to the Closing
      Date by an instrument in writing signed by the parties hereto; provided, however
      any amendment subsequent to the Closing Date shall require the signature of
      the
      Company and Investors that purchased a majority of the principal amount of
      Debentures issued pursuant to this Agreement. With respect to this Section
      10.3
      and Section 10.4 of this Agreement, if Investors that purchased a majority
      of
      the principal amount of Debentures issued pursuant to this Agreement do not,
      at
      the time of the amendment or waiver, own any Securities, then such amendment
      or
      waiver shall require the approval of Investors who hold of a majority of the
      shares of Common Stock issued or issuable upon conversion of the Debentures
      and
      exercise of the Warrants. 

     

    10.4     Waiver.
      At any
      time on or prior to the Closing Date, the Company or the Investors, as
      appropriate, may: (a) extend the time for the performance of any of the
      obligations or other acts of other party or; (b) waive any inaccuracies in
      the
      representations and warranties contained herein or in any document delivered
      pursuant hereto which have been made to it or them; or (c) waive compliance
      with
      any of the agreements or conditions contained herein for its or their benefit.
      At any time after the Closing Date, any waiver of any covenant or other
      provision of this Agreement shall require the approval of Investors that
      purchased a majority of the principal amount of Debentures issued pursuant
      to
      this Agreement and such waiver shall be deemed to be a waiver by the Investors.
      Any such extension or waiver shall be valid only if set forth in an instrument
      in writing signed by the party or parties to be bound thereby or, in the case
      of
      a waiver subsequent to the Closing Date, by Investors that purchased a majority
      of the principal amount of Debentures issued pursuant to this
      Agreement.

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 21

        
          

        

      

      
        
        

      

    

    Article
      11 

     

    GENERAL
      PROVISIONS

     

    11.1     Transaction
      Costs
      Except
      as otherwise provided herein, each of the parties shall pay all of his or its
      costs and expenses (including attorney fees and other legal costs and expenses
      and accountants’ fees and other accounting costs and expenses) incurred by that
      party in connection with this Agreement; provided, the Company shall pay Pope
      such due diligence expenses as described in Section 6.13.

     

    11.2     Indemnification.
      The
      Investor agrees to indemnify, defend and hold the Company (following the Closing
      Date) and its officers and directors harmless against and in respect of any
      and
      all claims, demands, losses, costs, expenses, obligations, liabilities or
      damages, including interest, penalties and reasonable attorney’s fees, that it
      shall incur or suffer, which arise out of or result from any breach of this
      Agreement by the Investors or failure by the Investors to perform with respect
      to the representations, warranties or covenants contained in this Agreement
      or
      in any exhibit or other instrument furnished or to be furnished under this
      Agreement. The Company agrees to indemnify, defend and hold the Investors
      (following the Closing Date) harmless against and in respect of any and all
      claims, demands, losses, costs, expenses, obligations, liabilities or damages,
      including interest, penalties and reasonable attorney’s fees, that it shall
      incur or suffer, which arise out of, result from or relate to any breach of
      this
      Agreement or failure by the Company to perform with respect to the
      representations, warranties or covenants contained in this Agreement or in
      any
      exhibit or other instrument furnished or to be furnished under this Agreement.
      In no event shall the Company or the Investors be entitled to recover
      consequential or punitive damages resulting from a breach or violation of this
      Agreement nor shall any party have any liability hereunder in the event of
      gross
      negligence or willful misconduct of the indemnified party. In the event of
      the
      failure of the Company to issue the Debentures and Warrants in violation of
      the
      provisions of this Agreement, the Investors, as their sole remedy, shall be
      entitled to pursue a remedy of specific performance upon tender into the Court
      an amount equal to the Purchase Price hereunder. The indemnification by the
      Investors shall be limited to $50,000.00. This Section 11.2 shall not relate
      to
      indemnification under the Registration Rights Agreement.

     

    11.3     Headings.
      The
      table of contents and headings contained in this Agreement are for reference
      purposes only and shall not affect in any way the meaning or interpretation
      of
      this Agreement.

     

    11.4     Entire
      Agreement.
      This
      Agreement (together with the Schedule, Exhibits, Warrants and documents referred
      to herein) constitute the entire agreement of the parties and supersede all
      prior agreements and undertakings, both written and oral, between the parties,
      or any of them, with respect to the subject matter hereof. 

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 22

        
          

        

      

      
        
        

      

    

    11.5     Notices.
      All
      notices and other communications hereunder shall be in writing and shall be
      deemed to have been given (i) on the date they are delivered if delivered in
      person; (ii) on the date initially received if delivered by facsimile
      transmission followed by registered or certified mail confirmation; (iii) on
      the
      date delivered by an overnight courier service; or (iv) on the third business
      day after it is mailed by registered or certified mail, return receipt requested
      with postage and other fees prepaid as follows:

     

    If
      to
      the Company:

     

    Middle
      Section, Longmao Street, Area A

    Laiyang
      Waixiangxing Industrial Park

    Laiyang
      City, Yantai

    Shandong
      Province

    People’s
      Republic of China 710075

    Attention:
      Mr. Cao Wubo

    E-mail:

    Fax:

    

    And

    

    Elsa
      Sung, Chief Financial Officer

    CFO
      Oncall, Inc.

    1643
      Royal Grove Way

    Weston,
      FL 33327

    E-mail:
      else@cfooncall.com

    Fax:
      (954) 337-2204

    

    With
      a
      copy to:

     

    Sichenzia
      Ross Friedman Ference LLP

    61
      Broadway

    New
      York,
      New York 10006

    Attention:
      Asher S. Levitsky PC

    E-mail:
      alevitsky@srff.com

    Fax:
      (212) 930-9725

     

    If
      to
      Pope:

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 23

        
          

        

      

      
        
        

      

    

    Pope
      Investment, LLC

    5100
      Poplar Avenue

    Suite
      805

    Memphis,
      Tennessee 38137

    fax:
      (901)
      763-4229

    Attn:
      Mr.
      Casey McCandless

    E-mail:
      caseymccandless@popeasset.com

     

    With
      a
      copy to:

     

    Wells,
      Moore, Simmons & Hubbard, PLLC

    Highland
      Bluff North, Suite 200

    4450
      Old
      Canton Road

    Jackson,
      Mississippi 39211

    Telephone:
      (601) 354-5400 

    Facsimile:
      (601) 355-5850

    Attention:
      R. Nash Neyland, Esq.

    E-mail:
      neyland@wellsmoore.com

     

    If
      to the
      other Investors, at their addresses set forth on Appendix A.

     

    11.6     Severability.
      If any
      term or other provision of this Agreement is invalid, illegal or incapable
      of
      being enforced by any rule of law or public policy, all other conditions and
      provisions of this Agreement shall nevertheless remain in full force and effect
      so long as the economic or legal substance of the transactions contemplated
      hereby is not affected in any manner materially adverse to any party. Upon
      such
      determination that any such term or other provision is invalid, illegal or
      incapable of being enforced, the parties hereto shall negotiate in good faith
      to
      modify this Agreement so as to effect the original intent of the parties as
      closely as possible in an acceptable manner to the end that the transactions
      contemplated hereby are fulfilled to the extent possible.

     

    11.7     Binding
      Effect.
      All the
      terms and provisions of this Agreement whether so expressed or not, shall be
      binding upon, inure to the benefit of, and be enforceable by the parties and
      their respective administrators, executors, legal representatives, heirs,
      successors and assignees. 

     

    11.8     Preparation
      of Agreement.
      This
      Agreement shall not be construed more strongly against any party regardless
      of
      who is responsible for its preparation. The parties acknowledge each contributed
      and is equally responsible for its preparation. In
      resolving any dispute regarding, or construing any provision in, this Agreement,
      there shall be no presumption made or inference drawn because of the drafting
      history of the Agreement, or because of the inclusion of a provision not
      contained in a prior draft or the deletion or modification of a provision
      contained in a prior draft.

     

    11.9     Governing
      Law.
      This
      Agreement shall be governed by, and construed in accordance with, the laws
      of
      the State of New York, without giving effect to applicable principles of
      conflicts of law.

     

    11.10     Jurisdiction;
      Waiver of Jury Trial.
      If
      any action is brought among the parties with respect to this Agreement or
      otherwise, by way of a claim or counterclaim, the parties agree that in any
      such
      action, and on all issues, the parties irrevocably waive their right to a trial
      by jury.
      Exclusive jurisdiction and venue for any such action shall be the federal and
      state courts situated in the City of Memphis, Shelby County and State of
      Tennessee. In the event suit or action is brought by any party under this
      Agreement to enforce any of its terms, or in any appeal therefrom, it is agreed
      that the prevailing party shall be entitled to reasonable attorneys fees to
      be
      fixed by the arbitrator, trial court, and/or appellate court if such party
      prevails on substantially all issues in dispute.

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 24

        
          

        

      

      
        
        

      

    

    11.11     Preparation
      and Filing of Securities and Exchange Commission
      filings.
      The
      Investors shall reasonably assist and cooperate with the Company in the
      preparation of all filings with the SEC after the Closing Date due after the
      Closing Date. 

     

    11.12     Further
      Assurances, Cooperation.
      Each
      party shall, upon reasonable request by the other party, execute and deliver
      any
      additional documents necessary or desirable to complete the transactions herein
      pursuant to and in the manner contemplated by this Agreement. The parties hereto
      agree to cooperate and use their respective best efforts to consummate the
      transactions contemplated by this Agreement.

     

    11.13     Survival.
      The
      representations, warranties, covenants and agreements made herein shall survive
      the Closing of the transaction contemplated hereby. 

     

    11.14     Third
      Parties.
      Except
      as disclosed in this Agreement, nothing in this Agreement, whether express
      or
      implied, is intended to confer any rights or remedies under or by reason of
      this
      Agreement on any persons other than the parties hereto and their respective
      administrators, executors, legal representatives, heirs, successors and
      assignees. Nothing in this Agreement is intended to relieve or discharge the
      obligation or liability of any third persons to any party to this Agreement,
      nor
      shall any provision give any third persons any right of subrogation or action
      over or against any party to this Agreement.

     

    11.15     Failure
      or Indulgence Not Waiver; Remedies Cumulative.
      No
      failure or delay on the part of any party hereto in the exercise of any right
      hereunder shall impair such right or be construed to be a waiver of, or
      acquiescence in, any breach of any representation, warranty, covenant or
      agreement herein, nor shall nay single or partial exercise of any such right
      preclude other or further exercise thereof or of any other right. All rights
      and
      remedies existing under this Agreement are cumulative to, and not exclusive
      of,
      any rights or remedies otherwise available.

     

    11.16     Counterparts.
      This
      Agreement may be executed in one or more counterparts, and by the different
      parties hereto in separate counterparts, each of which when executed shall
      be
      deemed to be an original, but all of which taken together shall constitute
      one
      and the same agreement. A facsimile transmission of this signed Agreement shall
      be legal and binding on all parties hereto. 

     

    [Signatures
      on following page]

     

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 25

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      the
      Investors and the Company have as of the date first written above executed
      this
      Agreement.

     

    THE
      COMPANY:

     

    
      
        	
                GENESIS
                  PHARMACEUTICALS ENTERPRISES, INC.

              	 
	 	 
	By:	 /s/
                Cao Wubo	 
	 	Cao
                Wubo, CEO	 
	 	 	 
	 	 	 

      

    

    

    INVESTORS:

     

    
      
        
          	
                  POPE
                    INVESTMENTS, LLC

                	 
	
                  By:
                    Pope Asset Management, LLC, Manager

                	 
	 	 
	By:	
                  /s/
                    William P. Wells    

                	 
	 	Cao
                  Wubo, CEO	 
	 	 	 
	 	
                  Name:
                    William P. Wells

                	 
	 	
                  Title:
                    President

                	 

        

      

       

    

    
      
        
        

      

      
        
          SECURITIES
            PURCHASE AGREEMENT BETWEEN 

          GENESIS
            PHARMACEUTICALS ENTERPRISES, INC. AND POPE INVESTMENTS,
            LLC
Page 26

        
          

        

      

      
        
        

      

       

    

    Schedule
      A

    
      	
              Name
                and

              Address

            	
              Amount
                of Investment

            	
              Principal
                Amount of Debentures

            	
              Number
                of Shares

              Underlying
                

              Warrants

            
	
              Pope
                Investments, LLC

              5100
                Poplar Avenue

              Suite
                805

              Memphis,
                Tennessee 38137

            	
              $5,000,000

            	
              $5,000,000

            	
              10,000,000

            
	 	 	 	 
	
              Total
                

            	
              $5,000,000

            	
              $5,000,000

            	
              10,000,000

            

    

    
-1-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}]]