Document:

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                                                                    EXHIBIT 10.2

***  Portions of this Exhibit have been omitted pending a confidential treatment
     request by the Company.

                          SECURITIES PURCHASE AGREEMENT

         THIS SECURITIES PURCHASE AGREEMENT ("Agreement") is made and entered
into effective as of August 11, 2000, by and among Optical Sensors Incorporated,
a Delaware corporation (the "Company"), with its principal place of business at
7615 Golden Triangle Drive, Suite A, Eden Prairie, Minnesota 55344, and the
investor listed on Schedule A hereto (the "Investor").

         A.       The Company desires to raise up to $1,500,000 of additional
capital in order to fund its operations.

         B.       The Investor desires to make an investment in the Company on
the terms and conditions set forth in this Agreement.

         Accordingly, in consideration of the foregoing, the mutual promises set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

1.       Authorization of Securities. The Company proposes to authorize, issue
         and sell the number of shares of Series A Convertible Preferred Stock,
         $.01 par value (the "Series A Preferred") as provided herein, which
         will be entitled to the preferences, rights and benefits set forth in
         the capital stock provisions of the Company's Certificate of
         Designation, which has been filed in the form set forth in Exhibit A
         attached hereto (the "Certificate of Designation"). The Series A
         Preferred will be convertible into shares of the Company's common
         stock, $.01 par value, as set forth in the Certificate of Designation.

2.       Purchase of Securities.

         (a)      Subject to the terms and conditions hereof, the Company agrees
                  to sell to the Investor, and the Investor agrees to purchase
                  from the Company in accordance with this Agreement, up to Four
                  Million Thirty Three Thousand Three Hundred Thirty Four
                  (4,333,334) shares of the Company's Series A Preferred (the
                  "Shares") in the amounts set forth on Schedule A. The purchase
                  price for the first One Million (1,000,000) shares of Series A
                  Preferred purchased by the Investor (in the aggregate) will be
                  Fifty Cents ($.50) per share, the purchase price for the next
                  One Million Three Hundred Thirty Three Thousand Three Hundred
                  Thirty Four (1,333,334) shares of Series A Preferred purchased
                  by the Investor (in the aggregate) will be Thirty Seven and
                  One-Half Cents ($.375) per share and the purchase price for
                  the next Two Million (2,000,000) purchased shares by the
                  Investor (in the aggregate) of Series A Preferred will be
                  Twenty-Five Cents ($.25) per share.

         (b)      From time to time after the date of this Agreement, the
                  Company will send a written notice to the Investor indicating
                  the number of shares of Series A Preferred that the Company
                  wishes to sell to the Investor (the "Notice") and the
                  applicable per share price in accordance with Section 2(b).
                  Within five (5) business days after the receipt of the Notice,
                  the Investor shall purchase the
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                  number of shares of Series A Preferred specified in the Notice
                  (the "Purchased Shares") by delivering to the Company within
                  such five (5) day period a certified check or wire transfer in
                  an amount equal to the number of Purchased Shares multiplied
                  by the applicable price, as determined by reference to Section
                  2(a) (the "Purchase Price"); provided, however, that the
                  Investor (in the aggregate) shall be required to purchase a
                  maximum of Four Million Thirty Three Thousand Three Hundred
                  Thirty Four (4,333,334) shares of Series A Preferred (the
                  "Maximum Commitment") with an aggregate maximum purchase price
                  of One Million Five Hundred Thousand Dollars ($1,500,000).

         (c)      At the time of delivery of the Purchase Price, the Company
                  shall deliver to the Investor stock certificate(s) for the
                  number of shares of Series A Preferred being purchased by such
                  Investor, which such shares will be registered in the
                  Investor's name or as otherwise designated by the Investor.

         (d)      Notwithstanding any other provision of this Agreement to the
                  contrary, the ability of the Company to sell shares of Series
                  A Preferred to the Investor is subject to the existing
                  contractual right of Instrumentation Laboratory Company
                  ("ILC") to participate in equity financings of the Company. In
                  the event that ILC elects to purchase any or all of the shares
                  of the Series A Preferred that would otherwise be offered to
                  the Investor under this Agreement, the number of shares so
                  purchased will reduce the Maximum Commitment by an equal
                  number. Any shares of Series A Preferred purchased by ILC will
                  be deemed to have been purchased by the Investor for purposes
                  of determining the Purchase Price for any shares of Series A
                  Preferred sold to the Investor.

3.       Adjustment of Notes and Warrants.
         --------------------------------

         (a)      Conversion Price of Notes. The conversion price of the
                  convertible promissory notes (the "Notes") issued to the
                  Investor pursuant to the Investment Agreement by and among the
                  Company and the other investors named therein dated March 10,
                  2000 (the "Investment Agreement"), as specified in Section 2.1
                  of the Note, is hereby amended so that such conversion price
                  at any time is equal to Fifty Thousand (50,000) multiplied by
                  the lowest price at which the Company sells any shares of its
                  capital stock (other than a sale pursuant to the exercise of
                  an option, right or warrant to subscribe for shares of Common
                  Stock that are outstanding on the date hereof or options
                  granted under the Company's stock option plan) after the first
                  date on which the Investor purchases shares of Series A
                  Preferred (the "Lowest Issue Price"). Subject to the foregoing
                  amendment, the foregoing conversion price otherwise remains
                  subject to adjustment as provided in Section 2.4 of the Note.

         (b)      Exercise Price of Warrants. The Exercise Price (as defined in
                  the warrant issued to the Investor pursuant to the Investment
                  Agreement (the "Warrant")) of the Warrant is hereby amended so
                  that the Exercise Price at any time is equal to the Lowest
                  Issue Price. Subject to the foregoing amendment, the foregoing

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                  conversion price otherwise remains subject to adjustment as
                  provided in Section 4 of the Warrant.

4.       Representations and Warranties of the Company. The Company represents
         and warrants to the Investor as follows:

         (a)      Organization. The Company is a corporation duly organized,
                  validly existing and in good standing under the laws of the
                  State of Delaware and has the requisite corporate power and
                  authority to own, lease or operate its properties and to carry
                  on its business as it is now being conducted and as it is
                  proposed to be conducted. The Company has no subsidiaries or
                  direct or indirect ownership in any firm, corporation or
                  business which either, individually or in the aggregate, is
                  material to the business of the Company. The Company is
                  qualified to do business and is in good standing as a foreign
                  corporation in every jurisdiction in which its ownership of
                  property or conduct of business requires it so to be qualified
                  and in which the failure to so qualify would have a material
                  adverse effect on the financial condition or business of the
                  Company.

         (b)      Authorization. The Company has the corporate power and
                  authority to execute and deliver this Agreement, the Shares
                  and to perform its obligations hereunder and thereunder,
                  including the issuance of the Shares and the Conversion
                  Securities (as defined below). This Agreement and the Shares
                  have been duly authorized by all necessary corporate action on
                  behalf of the Company, have been duly executed and delivered
                  by authorized officers of the Company, are valid and binding
                  agreements on the part of the Company and are enforceable
                  against the Company in accordance with their respective terms,
                  except as the enforceability thereof may be limited by
                  bankruptcy, insolvency, moratorium, reorganization or other
                  similar laws affecting the enforcement of creditors rights
                  generally and to judicial limitations on the enforcement of
                  the remedy of specific performance and other equitable
                  remedies. All corporate actions necessary for reservation and
                  issuance of the shares of Common Stock issuable upon
                  conversion of the Shares ("Conversion Securities") has been
                  taken. The Conversion Securities when issued pursuant to the
                  Certificate of Designation will be duly authorized, validly
                  issued, fully paid and nonassessable, free and clear of any
                  and all liens, charges, claims, encumbrances and preemptive
                  rights.

         (c)      No Violation. Neither the execution and delivery of this
                  Agreement nor any of the Shares by the Company, nor the
                  performance by the Company of its obligations hereunder or
                  thereunder, nor the consummation of the transactions
                  contemplated hereby or thereby will: (a) conflict with or
                  result in any breach of any provision of the Certificate of
                  Incorporation or By-Laws of the Company; (b) result in a
                  default (or give rise to any right of termination,
                  cancellation or acceleration) under any of the terms,
                  conditions or provisions of any note, lease, mortgage,
                  license, agreement or other instrument or obligation to which
                  the Company is a party or by which any of its assets may be
                  bound, except for such defaults (or rights of termination,
                  cancellation or acceleration) as to which requisite waivers or
                  consents have been obtained or which, in the aggregate,

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                  would not result in a material adverse effect on the Company;
                  (c) violate any order, writ, injunction, decree, statute, rule
                  or regulation applicable to the Company or any of its assets,
                  except for violations which would not result in a material
                  adverse effect on the Company; or (d) result in the creation
                  or imposition of any liens, charges or encumbrances upon any
                  assets of the Company.

         (d)      SEC Reports. The Company has filed all reports, registration
                  statements and other filings with the Securities and Exchange
                  Commission (the "Commission") required to be filed by it
                  pursuant to the Securities Act of 1933, as amended (the
                  "Securities Act"), and the Securities Exchange Act of 1934, as
                  amended (the "Exchange Act"). All such reports, registration
                  statements and other filings (including all notes, exhibits
                  and schedules thereto, all documents incorporated by reference
                  therein, and any amendments thereto) are collectively referred
                  to herein as the "SEC Reports." As of their respective dates
                  of filing with the Commission, the SEC Reports complied in all
                  material respects with all of the rules and regulations of the
                  Commission and 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
                  made therein, in light of the circumstances under which they
                  were made, not misleading.

         (e)      Financial Statements. The financial statements of the Company
                  included in the SEC Reports (the "Financial Statements") have
                  been prepared in accordance with United States generally
                  accepted accounting principles consistently applied and fairly
                  present the financial position of the Company at the dates
                  thereof and the results of the Company's operations and cash
                  flows for the periods then ended (subject, in the case of
                  unaudited statements, to normal adjustments and the omission
                  of footnotes). The Company has no material liabilities, known
                  or unknown, absolute, contingent or otherwise, except for (i)
                  liabilities that are set forth in the Financial Statements,
                  the notes thereto or the SEC Reports and (ii) liabilities that
                  have been incurred in the ordinary course of business since
                  June 30, 2000.

         (f)      No Material Adverse Change. There have not been any changes in
                  the assets, properties, liabilities, financial condition,
                  business or operations of the Company from that reflected in
                  the Financial Statements except for (i) changes in the
                  ordinary course of business which have not been, either
                  individually or in the aggregate, materially adverse and (ii)
                  the Company's continued operating losses and negative cash
                  flow.

         (g)      Authorized Capital Stock. The authorized capital stock of the
                  Company is as set forth in the SEC Reports. The issued and
                  outstanding shares of capital stock of the Company have been
                  duly authorized, validly issued and are fully paid and
                  nonassessable. As of the date hereof, the Company has
                  outstanding options and warrants to purchase 755,109 shares of
                  Common Stock, and there are no other outstanding warrants,
                  options or other rights to acquire any shares of capital stock
                  of the Company, except for the shares issued upon conversion
                  of the Notes, the Warrants issuable upon conversion of the
                  Notes and as disclosed in the SEC

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                  Reports. All of the above securities of the Company were
                  issued in compliance with all applicable federal and state
                  securities laws and were not issued in violation of or subject
                  to any preemptive rights or other rights to subscribe for or
                  purchase securities. Except for IL, no holder of any security
                  of the Company is entitled to any preemptive or similar rights
                  to purchase any securities of the Company.

         (h)      Intellectual Property. The Company owns or possesses adequate
                  rights to use all patents, patent rights, inventions,
                  trademarks, trade names, copyrights, licenses, domain names,
                  governmental authorizations, trade secrets and know-how that
                  are used or necessary for the conduct of its business; neither
                  the Company nor any of its subsidiaries has received any
                  notice of, or has any knowledge of, any infringement of or
                  conflict with asserted rights of others with respect to any
                  patents, patent rights, inventions, trademarks, trade names,
                  copyrights, licenses, governmental authorizations, trade
                  secret or know-how that, individually or in the aggregate, if
                  the subject of an unfavorable decision, ruling or finding,
                  would have a material adverse effect on the condition
                  (financial or otherwise), earnings, operations or business of
                  the Company and its subsidiaries considered as a whole.

         (i)      Securities Laws. Subject to the accuracy of the
                  representations of the Investor in Section 5, no consent,
                  authorization, approval, permit or order of or filing with any
                  governmental or regulatory authority is required under current
                  laws and regulations in connection with the execution and
                  delivery of this Agreement or the offer, issuance, sale or
                  delivery to the Investor of the Shares or the Conversion
                  Securities other than (i) the filing with the Commission of a
                  Form D pursuant to Regulation D under the Securities Act, and
                  the qualification thereof, if required, under applicable state
                  securities laws, which qualification has been or will be
                  effected as a condition of the sale of the Shares and the
                  issuance of the Conversion Securities, and (ii) the filing of
                  a registration statement or statements pursuant to Section 7.
                  Under the circumstances contemplated by this Agreement, the
                  offer, issuance, sale and delivery of the Shares will not,
                  under current laws and regulations, require compliance with
                  the prospectus delivery or registration requirements of the
                  Securities Act.

         (j)      Litigation. Except for the informal investigation by the
                  Commission regarding recent trading in the Company's Common
                  Stock there are no actions, suits, proceedings or
                  investigations pending or, to the best of the Company's
                  knowledge, threatened against the Company or any of its
                  properties before or by any court or arbitrator or any
                  governmental body, agency or official in which there is a
                  reasonable likelihood (in the judgment of the Company) of an
                  adverse decision that (a) would have a material adverse effect
                  on the Company's properties or assets or the business of the
                  Company as presently conducted or proposed to be conducted or
                  (b) would impair the ability of the Company to perform in any
                  material respect its obligations under this Agreement. The
                  Company is not in default with respect to any judgment, order
                  or decree of any court or governmental agency or
                  instrumentality which, individually or in the

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                  aggregate, would have a material adverse effect on the assets,
                  properties or business of the Company.

         (k)      Properties. The Company has good and marketable title to all
                  the properties and assets reflected as owned in the Financial
                  Statements, subject to no lien, mortgage, pledge, charge or
                  encumbrance of any kind except (i) those, if any, reflected in
                  such Financial Statements, or (ii) those which are not
                  material in amount and do not adversely affect the use made
                  and promised to be made of such property by the Company. The
                  Company holds its leased properties under valid and binding
                  leases, with such exceptions as are not materially significant
                  in relation to the business of the Company. The Company owns
                  or leases all such properties as are necessary to its
                  operations as now conducted or as proposed to be conducted.

         (l)      Brokers or Finders. To the knowledge of the Company, no
                  person, firm or corporation has or will have, as a result of
                  any act or omission of the Company, any right, interest or
                  valid claim against any Investor for any commission, fee or
                  other compensation as a finder or broker in connection with
                  the transactions contemplated by this Agreement. The Company
                  shall indemnify and hold the Investor harmless for any claims
                  made for any commission, fee or other compensation concerning
                  the transactions contemplated by this Agreement.

5.       Representations and Warranties of the Investor. The Investor represents
         and warrants to the Company as follows:

         (a)      The Shares are being purchased for investment for such
                  Investor's own account and not with the view to, or for resale
                  in connection with, any distribution or public offering
                  thereof. Each Investor understands that neither the Shares nor
                  the Conversion Securities have been registered under the
                  Securities Act or any state securities laws by reason of their
                  contemplated issuance in transactions exempt from the
                  registration requirements of the Securities Act and applicable
                  state securities laws and that the reliance of the Company and
                  others upon these exemptions is predicated in part upon this
                  representation by the Investor. The Investor further
                  understands that its shares of Series A Preferred and the
                  Conversion Securities may not be transferred or resold without
                  registration under the Securities Act and any applicable state
                  securities laws, or pursuant to an exemption from the
                  requirements of the Securities Act and applicable state
                  securities laws.

         (b)      The Investor's principal place of business is located at the
                  address set forth on Schedule A. The Investor qualifies as an
                  "accredited investor," as defined in Rule 501 of Regulation D
                  under the Securities Act. The Investor acknowledges that the
                  Company has made available to such Investor at a reasonable
                  time prior to the execution of this Agreement the opportunity
                  to ask questions and receive answers concerning the business,
                  operations and financial condition of the Company and the
                  terms and conditions of the sale of securities contemplated by
                  this Agreement and to obtain any additional information
                  requested by such

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                  Investor. The Investor is able to bear the loss of its entire
                  investment in the Shares and the Conversion Securities and has
                  such knowledge and experience of financial and business
                  matters that he is capable of evaluating the merits and risks
                  of the investment to be made pursuant to this Agreement.
                  However, neither the foregoing nor any other due diligence
                  investigation conducted by such Investor or on its behalf
                  shall limit, modify or affect the representations and
                  warranties of the Company set forth in Section 4 of this
                  Agreement or the right of such Investor to rely thereon.

         (c)      This Agreement has been duly authorized by all necessary
                  action on the part of the Investor, has been duly executed and
                  delivered by such Investor and is a valid and binding
                  agreement of such Investor.

6.       Use of Proceeds. The Company will use the proceeds from the sale of the
         Shares for general corporate purposes, including obtaining regulatory
         clearance for the Company's CapnoProbe sublingual CO2 monitor and
         disposable sensors.

7.       Registration Rights.
         -------------------

         (a)      Filing of Registration Statement. Within one hundred twenty
                  (120) days of the issuance of at least Two Million Five
                  Hundred Thousand shares of Series A Preferred, the Company
                  will file a registration statement with the Commission under
                  the Securities Act covering the Conversion Securities issuable
                  upon conversion of all of the Shares. The Company may, on not
                  more than one occasion, delay the filing of any registration
                  statement required hereunder for a period of not more than 90
                  days in the event that the Company has furnished the Investor
                  with a certificate executed by the Company's President or
                  Chief Executive Officer stating that such delay is necessary
                  in order to (i) not significantly adversely affect financing
                  efforts then underway at the Company or (ii) avoid disclosure
                  of material non-public information. Any registration of
                  Conversion Securities hereunder shall cover any additional
                  Conversion Securities issued or issuable pursuant to
                  anti-dilution or other similar rights.

         (b)      Registration Procedures. If and whenever the Company is
                  required by the provisions of Section 7(a) to effect the
                  registration of any Conversion Securities under the Securities
                  Act, the Company will:

                  (i)      prepare and file with the Commission a registration
                           statement (on any available form to effect
                           registration) with respect to such securities, and
                           use its best efforts to cause such registration
                           statement to become and remain effective until such
                           securities are sold pursuant to such registration
                           statement or are eligible to be sold pursuant to Rule
                           144(k);

                  (ii)     prepare and file with the Commission such amendments
                           to such registration statement and supplements to the
                           prospectus contained therein as may be necessary to
                           keep such registration statement effective until

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                  such securities are sold pursuant to such registration
                  statement or are eligible to be sold pursuant to Rule 144(k);

                  (iii)    furnish to the Investor and to any underwriters of
                           the securities being registered such reasonable
                           number of copies of the registration statement,
                           preliminary prospectus, final prospectus and such
                           other documents as the Investor and underwriters may
                           reasonably request in order to facilitate the public
                           offering of such securities;

                  (iv)     use its best efforts to register or qualify the
                           securities covered by such registration statement
                           under such state securities or blue sky laws of such
                           jurisdictions as the Investor may reasonably request,
                           except that the Company shall not for any purpose be
                           required to execute a general consent to service of
                           process or to qualify to do business as a foreign
                           corporation in any jurisdiction wherein it is not so
                           qualified;

                  (v)      prepare and promptly file with the Commission and
                           promptly notify the Investor of the filing of such
                           amendment or supplement to such registration
                           statement or prospectus as may be necessary to
                           correct any statements or omissions if, at the time
                           when a prospectus relating to such securities is
                           required to be delivered under the Securities Act,
                           any event shall have occurred as the result of which
                           any such prospectus or any other prospectus as then
                           in effect would include an untrue statement of a
                           material fact or omit to state any material fact
                           necessary to make the statements therein, in the
                           light of the circumstances in which they were made,
                           not misleading; and

                  (vi)     use its best efforts to cause all securities covered
                           by such registration statement to be listed on any
                           securities exchange, quotation system, market or
                           over-the-counter bulletin board, if any, on which the
                           Common Stock shall then be listed and trading.

(c)      Expenses. Except as set forth in the last sentence of this Section
         7(c), with respect to any registration of securities pursuant to
         Section 7(a), the Company shall bear all fees, costs and expenses,
         including, without limitation: all registration, filing and NASD fees,
         printing expenses, fees and disbursements of counsel and accountants
         for the Company, all internal Company expenses, the premiums and other
         costs of policies of insurance against liability arising out of the
         public offering, and all legal fees and disbursements and other
         expenses of complying with state securities or blue sky laws of any
         jurisdictions in which the securities to be offered are to be
         registered or qualified. Fees and disbursements of counsel and
         accountants for the Investor, underwriting discounts and commissions
         and transfer taxes for the Investor and any other expenses incurred by
         the Investor not expressly included above shall be borne by the
         Investor.

(d)      Indemnification. In the event that any Conversion Securities owned by
         the Investor are included in a registration statement under Section
         7(a):

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         (i)      The Company will indemnify and hold harmless the Investor
                  (including for this purpose its directors, officers and
                  partners) and any underwriter (as defined in the Securities
                  Act) from and against any and all loss, damage, liability,
                  cost and expense (including, subject to Section 7(d)(iii),
                  reasonable fees and expenses of counsel) to which any such
                  Investor or any such underwriter may become subject under the
                  Securities Act or otherwise, insofar as such losses, damages,
                  liabilities, costs or expenses are caused by any untrue
                  statement or alleged untrue statement of any material fact
                  contained in such registration statement, any prospectus
                  contained therein or any amendment or supplement thereto, or
                  arise out of or are based upon the omission or alleged
                  omission to state therein a material fact required to be
                  stated therein or necessary to make the statements therein, in
                  light of the circumstances in which they were made, not
                  misleading; provided, however, that the Company will not be
                  liable in any such case to the extent that any such loss,
                  damage, liability, cost or expense arises out of or is based
                  upon an untrue statement or alleged untrue statement or
                  omission or alleged omission so made in conformity with
                  written information furnished by such Investor or such
                  underwriter.

         (ii)     The Investor will indemnify and hold harmless the Company and
                  any underwriter from and against any and all loss, damage,
                  liability, cost or expense (including, subject to Section
                  7(d)(iii), reasonable fees and expenses of counsel) to which
                  the Company or any underwriter may become subject under the
                  Securities Act or otherwise, insofar as such losses, damages,
                  liabilities, costs or expenses are caused by any untrue or
                  alleged untrue statement of any material fact contained in
                  such registration statement, any prospectus contained therein
                  or any amendment or supplement thereto, or arise out of or are
                  based upon the omission or the alleged omission to state
                  therein a material fact required to be stated therein or
                  necessary to make the statements therein, in light of the
                  circumstances in which they were made, not misleading, in each
                  case to the extent, but only to the extent, that such untrue
                  statement or alleged untrue statement or omission or alleged
                  omission was so made in reliance upon and in strict conformity
                  with written information furnished by such Investor.
                  Notwithstanding the provisions of this clause (ii), no
                  Investor shall be required to indemnify any person pursuant to
                  this Section 7 in an amount in excess of the amount of the
                  aggregate net proceeds received by such Investor in connection
                  with any such registration under the Securities Act.

         (iii)    Promptly after receipt by an indemnified party pursuant to the
                  provisions of paragraph (i) or (ii) of this Section 7(d) of
                  notice of the commencement of any action involving the subject
                  matter of the foregoing indemnity provisions, such indemnified
                  party will, if a claim thereof is to be made against the
                  indemnifying party pursuant to the provisions of said
                  paragraph (i) or (ii), promptly notify the indemnifying party
                  of the commencement thereof; but the omission to so notify the
                  indemnifying party will not relieve the indemnifying

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                  party from any liability which it may have to any indemnified
                  party otherwise than hereunder nor of its obligations or
                  liabilities pursuant to this Agreement, except to the extent
                  that the failure to so notify materially prejudices the
                  indemnifying party. In case such action is brought against any
                  indemnified party and it notifies the indemnifying party of
                  the commencement thereof, the indemnifying party shall have
                  the right to participate in, and, to the extent that it may
                  wish, jointly with any other indemnifying party similarly
                  notified, to assume the defense thereof, with counsel
                  satisfactory to such indemnified party; provided, however, if
                  the defendants in any action include both the indemnified
                  party and the indemnifying party and there is a conflict of
                  interest which would prevent counsel for the indemnifying
                  party from also representing the indemnified party, the
                  indemnified party or parties shall have the right to select
                  one separate counsel to participate in the defense of such
                  action on behalf of such indemnified party or parties, which
                  counsel shall be reasonably satisfactory to the indemnifying
                  party. After notice from the indemnifying party to such
                  indemnified party of its election so to assume the defense
                  thereof, the indemnifying party will not be liable to such
                  indemnified party pursuant to the provisions of said paragraph
                  (i) or (ii) for any legal or other expense subsequently
                  incurred by such indemnified party in connection with the
                  defense thereof other than reasonable costs of investigation,
                  unless (x) the indemnified party shall have employed counsel
                  in accordance with the proviso of the preceding sentence, (y)
                  the indemnifying party shall not have employed counsel
                  satisfactory to the indemnified party to represent the
                  indemnified party within a reasonable time after the notice of
                  the commencement of the action, or (z) the indemnifying party
                  has authorized the employment of counsel for the indemnified
                  party at the expense of the indemnifying party. No
                  indemnifying party shall, without the prior written consent of
                  the indemnified party, consent to entry of any judgment or
                  enter into any settlement which does not include as an
                  unconditional term thereof the giving by the claimant or the
                  plaintiff to such indemnified party of a release from all
                  liability in respect of such action, and no indemnified party
                  shall consent to entry of any judgment or settle such action
                  without the prior written consent of the indemnifying party.

(e)      SEC Reports. The Company will file with the Commission, on a timely
         basis, all SEC Reports required to be filed under the Exchange Act and
         any other documents required to meet the public information
         requirements of Rule 144(c) under the Securities Act.

(f)      Bonus. Upon a Change in Control, as defined below, the Company's
         employees, in the aggregate, will be paid a bonus (the "Bonus") equal
         to (A) One Hundred Percent (100%) of the proceeds to the Company or its
         shareholders from the Change in Control transaction between Fifteen
         Million Dollars ($15,000,000) and Sixteen Million Dollars ($16,000,000)
         plus (B) Ten Percent (10%) of the proceeds to the Company or its
         shareholders from the Change in Control

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         transaction between Sixteen Million Dollars ($16,000,000) and Twenty
         Million Dollars ($20,000,000). The allocation of the Bonus among the
         individual employees of the Company shall be as set forth in Schedule
         A, as amended from time to time by the President and Chief Executive
         Officer of the Company as necessary to reflect changes in personnel.
         For purposes of this Agreement, Change in Control shall mean the
         occurrence of any of the following on or after the date hereof:

         (i)      the sale, lease, exchange or other transfer, directly or
                  indirectly, of all or substantially all of the assets of the
                  Company, in one transaction or in a series of related
                  transactions, to any Person;

         (ii)     the approval by the shareholders of the Company of any plan or
                  proposal for the liquidation or dissolution of the Company;

         (iii)    any Person is or becomes the "beneficial owner" (as defined in
                  Rule 13d-3 under the Exchange Act), directly or indirectly, of
                  (a) 20 percent or more, but not more than 50 percent, of the
                  combined voting power of the Company's outstanding securities
                  ordinarily having the right to vote at elections of directors,
                  unless the transaction resulting in such ownership has been
                  approved in advance by the "continuity directors," as defined
                  at Subsection (b), or (b) more than 50 percent of the combined
                  voting power of the Company's outstanding securities
                  ordinarily having the right to vote at elections of directors
                  (regardless of any approval by the continuity directors);

         (iv)     a merger or consolidation to which the Company is a party if
                  the shareholders of the Company immediately prior to the
                  effective date of such merger or consolidation have, solely on
                  account of ownership of securities of the Company at such
                  time, "beneficial ownership" (as defined in Rule 13d-3 under
                  the Exchange Act) immediately following the effective date of
                  such merger or consolidation of securities of the surviving
                  company representing (a) 50 percent or more, but not more than
                  80 percent, of the combined voting power of the surviving
                  corporation's then outstanding securities ordinarily having
                  the right to vote at elections of directors, unless such
                  merger or consolidation has been approved in advance by the
                  continuity directors, or (b) less than 50 percent of the
                  combined voting power of the surviving corporation's then
                  outstanding securities ordinarily having the right to vote at
                  elections of directors (regardless of any approval by the
                  continuity directors);

         (v)      the continuity directors cease for any reason to constitute at
                  least a majority the Board;

         (vi)     or a change in control of a nature that is determined by
                  outside legal counsel to the Company, in a written opinion
                  specifically referencing this provision of the Plan, to be
                  required to be reported (assuming such event

                                       11
<PAGE>

                  has not been "previously reported") pursuant to section 13 or
                  15(d) of the Exchange Act, whether or not the Company is then
                  subject to such reporting requirement, as of the effective
                  date of such change in control.

         The sale, lease, exchange or other transfer, directly or indirectly, of
         the assets comprising the Company's CapnoProbe Product Line, in one
         transaction or in a series of related transactions, to any Person shall
         constituted a Change in Control under Subsection (a)(i).

         For purposes of this section: "continuity director" means any
         individual who is a member of the Board on the date hereof, while he or
         she is a member of the Board, and any individual who subsequently
         becomes a member of the Board whose election or nomination for election
         by the Company's shareholders was approved by a vote of at least a
         majority of the directors who are continuity directors (either by a
         specific vote or by approval of the proxy statement of the Company in
         which such individual is named as a nominee for director without
         objection to such nomination). For example, if a majority of the four
         individuals constituting the Board on the date hereof, approved a proxy
         statement in which two different individuals were nominated to replace
         two of the individuals who were members of the Board on the date
         hereof, upon their election by the Company's shareholders, the two
         newly elected directors would join the two remaining directors who were
         members of the Board on date hereof as continuity directors. Similarly
         if a majority of those four directors approved a proxy statement in
         which two different individuals were nominated to replace the two other
         directors who were members of the Board on date hereof, upon their
         election by the Company's shareholders, the two newly elected directors
         would also become, along with the two other directors, continuity
         directors. Individuals subsequently joining the Board could become
         continuity directors under the principles reflected in this example.

8.       Repricing of Options. As soon as practicable after each sale of any of
         the Shares to the Investor, the exercise price of all option agreements
         held by current employees and current directors of the Company will be
         changed to the figure equal to (i) the aggregate purchase price that
         was paid for all shares of Series A Preferred issued to the Investor
         prior to the date of determination (whether or not all such shares are
         then outstanding) divided by (ii) the aggregate number of shares of
         Series A Preferred that were issued to the Investor prior to the date
         of determination (whether or not all such shares are then outstanding).

9.       Miscellaneous.
         -------------

         (a)      This Agreement and the rights and obligations of the parties
                  hereunder shall not be assignable, in whole or in part, by the
                  Company without the prior written consent of the Investor.
                  This Agreement and the rights and obligations of the parties
                  hereunder shall not be assignable, in whole or in part, by an
                  Investor without the prior written consent of the Company,
                  except that any Investor may assign its rights under this
                  Agreement to any affiliate without the prior written

                                       12
<PAGE>

                  consent of the Company. This Agreement shall inure to the
                  benefit of and be binding upon and be enforceable by the
                  successors and permitted assigns of the parties hereto.
                  Neither this Agreement nor any provision hereof may be
                  amended, modified, waived or discharged without the written
                  consent of the parties hereto.

         (b)      This Agreement, including the exhibits attached hereto,
                  constitutes the entire agreement of the parties relative to
                  the subject matter hereof and supersedes any and all other
                  agreements and understanding, whether written or oral,
                  relative to the matters discussed herein.

         (c)      All representations and warranties contained herein shall
                  survive after the execution and delivery of this Agreement for
                  a period of two (2) years from the date hereof. All covenants
                  and agreements which by their terms are to be performed after
                  the date hereof will survive indefinitely, unless such
                  covenants and agreements by their terms expire at an earlier
                  date, in which case they will expire on such earlier date.

         (d)      All notices, requests, consents and other communications
                  required or permitted hereunder shall be in writing and shall
                  be given in writing by personal delivery, facsimile,
                  commercial air delivery service or by registered or certified
                  mail, postage prepaid, return receipt requested, addressed to
                  the Company at the address set forth in the introductory
                  paragraph to this Agreement and to the Investor at the
                  addresses set forth on Schedule A, or at such other address as
                  the respective parties may designate by like notice from time
                  to time. Notices so given shall be effective upon the earlier
                  of: (a) receipt by the party to which notice is given (which,
                  in the instance of a facsimile, shall be deemed to have
                  occurred at the time that the machine transmitting the
                  facsimile verifies a successful transmission of the
                  facsimile); (b) on the fifth business day following the date
                  such notice was deposited in the mail; or (c) on the second
                  business day following the date such notice was delivered to a
                  commercial air delivery service.

         (e)      This Agreement shall be construed and enforced in accordance
                  with the laws of the State of Minnesota.

         (f)      This Agreement may be executed in two or more counterparts,
                  each of which shall be deemed an original, but all of which
                  together shall constitute one and the same instrument. This
                  Agreement may be executed by facsimile.

                          [Next Page is Signature Page]

                                       13
<PAGE>

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

                                       OPTICAL SENSORS INCORPORATED

                                       By
                                         ---------------------------------------
                                         Paulita LaPlante,
                                         President and Chief Executive Officer

                                       CIRCLE F VENTURES LLC

                                       By
                                         ---------------------------------------

                                       Its
                                          --------------------------------------

                                       14
<PAGE>

                                   SCHEDULE A

Investor

Circle F Ventures LLC
17797 North Perimeter Drive
Suite 105
Scottsdale, Arizona 85255

                                       15
<PAGE>

                                  SCHEDULE A

                                       BONUS
EMPLOYEES                           DESIGNATION
---------                           -----------
Paulita LaPlante                        ***
Wes Peterson                            ***
Dan Bartnik                             ***
Victor Kimball                          ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***
***                                     ***

             Totals

Bonus Breakout:

Tier 1 = 60%
Tier 2 = 30%
Tier 3 = 10%

***  Portions of this Exhibit have been omitted pending a confidential treatment
     request by the Company.EXHIBIT 10.1
                          AGREEMENT AND PLAN OF MERGER
<PAGE>
                          AGREEMENT AND PLAN OF MERGER

         THIS AGREEMENT AND PLAN OF MERGER (the  "Agreement") is entered into as
of the 21st day of  November,  2000,  by and among  Comercis,  Inc.,  a Delaware
corporation  ("Comercis")  and Rocky  Mountain  Financial  Enterprises,  Inc., a
Colorado corporation ("RMFE")

         WHEREAS,  Comercis is authorized  to issue up to  50,000,000  shares of
common stock ("Comercis Common Stock") of which 21,452,712 shares are issued and
outstanding; and

         WHEREAS,  RMFE is authorized to issue up to 20,000,000 shares of common
stock ("RMFE Stock") of which 19,737,432 shares are issued and outstanding; and

         WHEREAS,  the  respective  Boards  of  Directors  of RMFE and  Comercis
believe it to be in the best  interests  of their  respective  corporations  and
shareholders  for  Comercis  to  merge  with and into  RMFE  (Comercis  and RMFE
sometimes  referred  to as the  "Constituent  Corporations")  upon the terms and
conditions  herein  contained;  and in connection  therewith  have each adopted,
approved and authorized the execution and delivery of this Agreement and Plan of
Merger (the "Agreement"); and

         WHEREAS,  the  Board  of  Directors  of  Comercis  has  submitted  this
Agreement  and the  subject  merger to  Comercis  shareholders  for  approval as
required by the corporate law of the State of Delaware.

         NOW  THEREFORE,  in  consideration  of  the  premises  and  the  mutual
representations,  warranties,  covenants and agreements  herein  contained,  the
parties hereto do hereby agree as follows:

                                    I. MERGER

         1.01 EFFECTIVE TIME. The merger contemplated by this Agreement shall be
effective on the date and time that the  Certificate of Merger is filed with the
Secretary of State of the State of Delaware (the "Effective Time").

         1.02 MERGER.  Upon the terms and subject to the conditions set forth in
this Agreement,  and in accordance with the General Corporation Law of the State
of  Delaware  (the  "GCL"),  Comercis  shall be merged with and into RMFE at the
Effective Time (the "Merger").  As of the Effective Time, the separate corporate

<PAGE>

existence  of  Comercis  shall cease and RMFE shall  continue  as the  surviving
corporation  (the "Surviving  Corporation") in Colorado and shall succeed to and
assume  all the  rights and  obligations  of  Comercis  in  accordance  with the
Colorado Revised Statutes. Without limiting the generality of the foregoing:

                  (a) RMFE,  as the  surviving  corporation  shall  continue its
corporate  existence  under the laws of the State of Colorado and shall  possess
all of the rights,  privileges,  immunities,  powers,  franchises  and authority
(both  public  and  private)  of,  and be  subject  to all of the  restrictions,
disabilities and duties of RMFE and Comercis;

                  (b) all the assets and  property  of  Comercis  of every kind,
nature  and  description  (real,  personal  and  mixed  and  both  tangible  and
intangible) and every interest therein,  wheresoever located,  including without
limitation  all debts or other  obligations  belonging or due to  Comercis,  all
stock subscriptions,  options,  warrants,  claims and chooses in action shall be
and be deemed to be vested,  absolutely and unconditionally in RMFE (to the same
extent, degree and manner as previously vested in Comercis);

                  (c) all debts  and  obligations  of  Comercis,  all  rights of
creditors  of Comercis  and all liens  encumbering  any of the  property of RMFE
vested in Comercis shall remain in full force and effect without modification or
impairment  and shall be and be deemed to be  enforceable  against  RMFE and its
assets and  properties  with the same full  force and  effect as if such  debts,
obligations or liens had been originally  incurred or created by RMFE in its own
name and for its own behalf.

         1.03 CLOSING.  Subject to the satisfaction or waiver of the last of the
conditions  set forth in Article VI hereof,  the closing of the Merger will take
place at 10:00 am on December 14, 2000,  at the offices of RMFE,  at the offices
of  Comercis,  Inc.,  or at such  other  time and place as the  parties  to this
Agreement shall agree (the "Closing Date").  Subject to the terms and conditions
of this  Agreement,  on the  Closing  Date:  (a) the parties  hereto  shall each
deliver  to the other the  documents,  agreements,  payments  and  consideration
required to be delivered  by each to the other party hereto as herein  expressly
provided and (b) the Constituent  Corporations  shall execute two originals of a
Certificate of Merger in the forms  required for filing with the  Secretary's of
State of Delaware and Colorado,  which  Certificates of Merger shall be filed by
the parties with the  Secretary's of State of Delaware and Colorado  immediately
after  execution  on the  Closing  Date.  Subsequent  to the Closing the parties
hereto shall thereafter execute,  acknowledge,  deliver and/or record such other
and further  instruments,  documents or certificates and/or take an perform such
other and  further  actions as may be required to effect  and/or  implement  the
merger.

         1.04  NAME.  The name of the  Surviving  Corporation  shall  be  "Rocky
Mountain Financial Enterprises, Inc."

         1.05 CONSTITUTIONAL DOCUMENTS, DIRECTORS AND OFFICERS. On and as of the
Effective Time:
<PAGE>

                  (a) The Certificate of  Incorporation  of RMFE on such date in
full force and effect shall be the Certificate of  Incorporation of RMFE, as the
surviving  corporation,  until the same  shall be  altered,  amended,  modified,
terminated or rescinded in the manner provided by the Colorado Revised Statutes;
which  rights  of  alteration,  amendment,   modification,   termination  and/or
rescission are hereby expressly reserved by RMFE;

                  (b) The By-Laws of RMFE on such date in full force and effect,
shall be the By-Laws of RMFE, as the surviving corporation, until the same shall
be altered, amended, modified, terminated or rescinded in the manner provided in
the Certificate of  Incorporation  and/or the laws of Colorado;  which rights of
alteration,  amendment,  modification,  termination and/or rescission are hereby
expressly reserved by RMFE;

                  (c) The members of the Board of Directors, and the officers of
RMFE, the Surviving Corporation,  shall consist of the directors and officers of
RMFE  immediately  prior to the Effective  Time;  each to serve in such capacity
until the earlier of their  resignation or removal or until their successors are
duly elected and qualified.

         1.06  PRINCIPAL   OFFICE.   The  principal   office  of  the  Surviving
Corporation shall be 402 N. Caroll Aven, Suite 110, Southlake, Texas 76092.

        II. EFFECT OF MERGER ON CAPITAL STOCK OF CONSTITUENT CORPORATIONS
                           - EXCHANGE OF CERTIFICATES

         2.01 CONVERSION OF CAPITAL STOCK OF COMERCIS. As of the Effective Time,
the shares of Comercis  Stock shall be converted  and  exchanged  into shares of
RMFE Common Stock and cash consideration in the following manner:

         (a) Each issued and  outstanding  share of  Comercis  Stock  shall,  by
virtue of the merger and without  any action on the part of the holder  thereof,
be  converted  and  exchanged  into a unit  consisting  of .85  fully  paid  and
nonassessable  shares of RMFE Common  Stock and a warrant to purchase .25 shares
of RMFE at $0.01  exercisable when the Company has authorized  sufficient number
of shares to cover all options, warrants and any other convertible instruments;

         (b) After the  Effective  Time,  each  holder,  other than a Dissenting
Shareholder,  of an  outstanding  certificate  which prior to the Effective Time
represented  shares of Comercis  Stock shall  surrender such  certificate  ("Old
Certificate")  to RMFE, and such holder shall be entitled upon such surrender to
receive in exchange  therefore a  certificate  for that number of shares of RMFE
Common Stock which such holder is entitled to receive under  Section  2.01(a) of
this Agreement. Until surrendered as contemplated by this sub-section,  each Old
Certificate  for shares of Comercis Stock shall be deemed at all times after the
Effective  Time to represent  and evidence  (for all  corporate  purposes)  that
number of shares of RMFE Common Stock into which the

<PAGE>

shares of Comercis Stock  theretofore  represented by such Old Certificate shall
have been  converted  pursuant  to Section  2.01(a)  hereof.  From and after the
Effective Time the sole rights of the holders of Old  Certificates  representing
shares of Comercis  Stock shall be those to which they are entitled as owners of
RMFE Common Stock into which the shares of Comercis Stock  evidenced by such Old
Certificates have been converted as herein provided;

         (c)  Notwithstanding  anything in this  Agreement to the contrary,  any
issued and  outstanding  shares of Comercis  Stock held by a person who complies
with all of the  provisions of Delaware law  concerning the rights of holders of
Comercis  Stock to object to the Merger and require  appraisal  of their  shares
("Dissenting  Shares" and "Dissenting  Shareholders",  as the case may be) shall
not be converted as described in Section 2.01(a) but shall,  instead entitle the
holder thereof to receive such  consideration  as may be determined to be due to
such  Dissenting  Shareholder  pursuant to Delaware law. If, after the Effective
Time, such Dissenting Shareholder withdraws his demand for appraisal or fails to
perfect or otherwise loses his right of appraisal pursuant to Delaware law, each
of his shares shall be deemed to be converted as of the Effective  time into the
RMFE Common Stock specified in ss.2.01(a).

                   III. REPRESENTATIONS AND WARRANTIES OF RMFE

         In order to induce Comercis to execute and perform this Agreement, RMFE
does hereby  represent,  warrant,  covenant  and agree  (which  representations,
warranties, covenants and agreements shall be and be deemed to be continuing and
survive  the  execution  and  delivery  of this  Agreement,  the Closing and the
Effective Time) as follows:

         3.01     ORGANIZATION AND QUALIFICATION

                  (a) RMFE is a corporation  duly organized,  validly  existing,
and in good standing  under the laws of Colorado,  with all requisite  power and
authority to own, lease, license, and use its properties and assets and to carry
on the business in which it is now engaged.  RMFE is duly  qualified to transact
the  business  in which  it is  engaged  and is in good  standing  as a  foreign
corporation in every jurisdiction in which its ownership, leasing, licensing, or
use  of  property  or  assets  or  the  conduct  of  its  business   makes  such
qualification necessary.

                  (b)  RMFE  has  furnished  to  Comercis  its   Certificate  of
Incorporation and By-Laws, as presently in effect, certified by the Secretary of
the corporation.  RMFE is not in material  violation or breach of, or in default
with respect to, any term of its Certificate of Incorporation or By-Laws.
<PAGE>

         3.02  CAPITALIZATION  The authorized  capital stock of RMFE consists of
20,000,000  shares of RMFE Common Stock of which  19,737,432  shares were issued
and outstanding as of October 20, 2000.

         3.03 AUTHORITY  RMFE has all requisite  power and authority to execute,
deliver, and perform this Agreement. All necessary corporate proceedings of RMFE
have been or as of the Effective Time will have been duly taken to authorize the
execution,  delivery,  and performance of this Agreement by RMFE. This Agreement
has been duly  authorized,  executed,  and  delivered by RMFE,  constitutes  the
legal,  valid, and binding obligation of, RMFE, and is enforceable as to RMFE in
accordance with its terms subject, as to enforcement of remedies,  to applicable
bankruptcy, insolvency, reorganization,  moratorium and other laws affecting the
rights of creditors generally and the discretion of courts in granting equitable
remedies.  Except for the provisions of the Colorado Revised Statutes  governing
the filing of the Certificate of Merger,  no consent,  authorization,  approval,
order,  license,  certificate,  or permit of or from, or  declaration  or filing
with, any federal, state, local, or other governmental authority or any court or
other tribunal is required by RMFE for the execution,  delivery,  or performance
of this Agreement by RMFE.

         3.04 RMFE  COMMON  STOCK All of the shares of RMFE  Common  Stock to be
issued by RMFE pursuant to this Agreement  shall be and be deemed to be duly and
validly  authorized and, when issued to the shareholders of Comercis in exchange
for their Comercis Stock, duly and validly issued,  fully paid and nonassessable
and free and clear of all  federal  and state  issuance,  stock  and/or  company
taxes, liens, claims, encumbrances and charges.

         3.05  CERTIFICATE  The  representations,   warranties,   covenants  and
agreements of RMFE contained in this Agreement,  including,  without limitation,
those  contained  in this  Article  III,  are true,  accurate and correct in all
respects  as of the date  hereof and shall be true,  accurate  and  correct  and
complete,  in all  respects,  as of the  Closing;  and at the Closing RMFE shall
deliver to Comercis a certificate,  executed by the chief  executive  officer of
RMFE  remaking,  on behalf  of RMFE,  each of the  representations,  warranties,
covenants and agreements of RMFE set forth in this Agreement,  including without
limitation, those set forth in this Article III hereof.

         3.06     FINANCIAL STATEMENTS AND CONDITION

                  (a)  RMFE has  delivered  to  Comercis  a true,  correct,  and
complete  copy of its 10-KSB for  December 31, 1999  ("Registration  Statement")
filed pursuant to the Securities Exchange Act of 1934, as amended (the "34 Act")
which contains therein the audited balance sheet, statement of income, statement
of retained  earnings,  and  statement of cash flows of RMFE for the fiscal year
ended December 31, 1999 (the "Audited Financial Statements").

                  (b) At or prior to Closing, RMFE shall have filed its Form 10Q
for  the  period  ended  September  30,  2000,   including  unaudited  financial

<PAGE>

statements   ("Interim   Statements,"  the  Audited  Financial   Statements  and
collectively the "Financial Statements").

                  (c) The Financial  Statements were prepared in accordance with
generally  accepted   accounting   principles  ("GAAP")   consistently   applied
throughout the period involved,  are true, correct, and complete in all material
respects,  are in  accordance  with the books  and  records  of RMFE and  fairly
present together with the notes thereto,  the financial  position and results of
operations of RMFE for the periods therein indicated.

                  (d) Since the dates of the  Financial  Statements,  there have
not been,  nor prior to closing will there be, any material  adverse  changes in
the business or condition, financial or otherwise, of RMFE.

         3.07 FILINGS RMFE has delivered (or will deliver, prior to the Closing)
to Comercis true,  correct,  and complete copies of the  Registration  Statement
(including exhibits) together with each of its other reports to shareholders and
filings with the Commission for the year ended December 31, 1999 and through the
date of the  Closing,  RMFE has duly and timely  filed  (and will,  prior to the
Closing,  duly and timely file) all reports required to be filed by it under the
Securities Act of 1933, as amended ("33 Act") and the 34 Act  (collectively  the
"Federal  Securities Laws").  None of the foregoing reports nor any reports sent
to the  shareholders of RMFE contained any untrue  statement of material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements in such reports,  in light of the circumstances  under which
they were made, not misleading.

         3.08 BOARD  ACTION  During the period  from the date  hereof  until the
Closing,  there  shall not be taken any  action  by the  Board of  Directors  of
Comercis without the prior written consent of RMFE in each instance.

                 IV. REPRESENTATIONS AND WARRANTIES OF COMERCIS

         In order to induce RMFE to execute and perform this Agreement, Comercis
does hereby  represent,  warrant,  covenant  and agree  (which  representations,
warranties, covenants and agreements shall be and be deemed to be continuing and
survive  the  execution  and  delivery  of this  Agreement,  the Closing and the
Effective Time) as follows:

         4.01  ORGANIZATION  AND GOOD STANDING  Comercis is a  corporation  duly
organized,  validly existing and in good standing under the laws of the State of
Delaware  with full power and  authority to own or lease its  properties  and to
carry on its business as presently  being  conducted  and enter into and perform
each  of the  transactions,  covenants  and  agreements  provided  for  in  this
Agreement.

         4.02 EXECUTION AND PERFORMANCE  AUTHORIZED The execution,  delivery and
performance  of this  Agreement and all other  documents and related  agreements
contemplated hereunder,  have been duly approved by Comercis' board of directors

<PAGE>

and  shareholders;  such execution and delivery and the consummation by Comercis
of the transactions,  covenants and agreements  contemplated hereunder have been
duly authorized by the taking of all necessary  corporate action; and no further
action is required  to be taken by law and/or  pursuant  to the  certificate  of
incorporation,  by-laws or  otherwise of Comercis to  authorize  the  execution,
delivery and/or  performance of this Agreement,  and/or the taking of all action
required  to be  taken  by  Comercis  with  respect  to this  Agreement  and the
consummation of the transactions and performance of this Agreement and the other
agreements  contemplated  hereunder.  The  Agreement  and  the  other  documents
contemplated  hereunder,  are valid and  binding and fully  enforceable  against
Comercis in accordance with their respective terms,  subject,  as to enforcement
of remedies, to applicable bankruptcy,  insolvency,  reorganization,  moratorium
and other laws affecting the rights of creditors generally and the discretion of
courts in granting  equitable  remedies.  No consent,  authorization,  approval,
order,  license,  certificate,  or permit of or from, or  declaration  or filing
with, any federal, state, local, or other governmental authority or any court or
other  tribunal  is  required  by  Comercis  for  the  execution,  delivery,  or
performance of this Agreement and the other agreements referred to herein.

         4.03 ABSENCE OF LITIGATION There is no action,  lawsuit,  proceeding or
investigation  of any kind or nature  pending or, to its  knowledge,  threatened
against Comercis before any court,  tribunal or  administrative  agency or board
which it reasonably expects, individually or in the aggregate, to materially and
adversely:  (a) affect  the  solvency  of  Comercis,  (b) affect its  ability to
perform hereunder, or (c) render any one or more of this Agreement and/or any of
the agreements referred to herein and/or the transactions contemplated hereunder
void or voidable.

         4.04 NO OTHER DEFAULT The execution and delivery of this  Agreement and
the  other  agreements   referred  to  herein,   and  the  consummation  of  the
transactions contemplated hereunder will not conflict with or violate or require
any  consent  under  and  will  not  result  in any  breach  or  termination  of
certificate of incorporation  or by-laws of Comercis,  or any other agreement to
which  Comercis is a party or by which its properties are subject or by which it
is bound.  Comercis is not in violation of, or in default under, (i) any term or
provision of its constitutional  documents;  (ii) any material term or provision
or any financial covenant of any indenture,  mortgage,  contract,  commitment or
other  agreement or  instrument  to which it is a party or by which it or any or
its properties or business is or may be bound or affected; or (iii) any existing
applicable law, rule, regulation,  judgment, order or decree of any governmental
agency or court, domestic or foreign,  having jurisdiction over it or any of its
properties  or  business.   Comercis   owns,   possesses  or  has  obtained  all
governmental  and  other  licenses,  permits,   certifications,   registrations,
approvals or consents and other authorizations necessary to own or lease, as the
case may be, and to  operate  its  properties  and to conduct  its  business  or
operations as presently  conducted and all such governmental and other licenses,
permits,   certifications,   registrations,   approvals,   consents   and  other
authorizations  are  outstanding  and  in  good  standing,   and  there  are  no
proceedings pending or, to the best of its knowledge,  threatened,  or any basis
therefor existing, seeking to cancel, terminate or limit such licenses, permits,

<PAGE>

certifications,  registrations,  approvals  or  consents or  authorizations,  or
related  to the  breach or failure  to comply of  Comercis  with any law,  rule,
regulation, judgment, order or decree;

         4.05 PERMITS AND FILINGS  Except for the filing of the  Certificate  of
Merger,  there is no  requirement  applicable  to  Comercis  to make any further
filing with, or to obtain any permit, authorization, consent or approval of, any
governmental  or  other  regulatory  authority  as a  condition  of  the  lawful
consummation of the transactions contemplated under this Agreement.

         4.06 CORPORATE  DOCUMENTS  Comercis has furnished to RMFE true, correct
and complete  copies of its  certificate  of  incorporation,  by-laws and minute
book, and a certificate of good standing from the State of Delaware dated within
thirty (30) days of the Closing Date.  The minute book contains a record,  which
is complete  and  accurate in all  material  respects,  of all  meetings and all
corporate  actions  of the  shareholders  and Board of  Directors  of  Comercis.
Comercis is not in material  violation  or breach of, or in default with respect
to, (a) any term of its constitutional documents or any agreement to which it is
a party or by which its  assets  are bound,  or (b) any law,  rule,  regulation,
judgment,   order  or  decree  of  any  governmental   agency  or  court  having
jurisdiction over it or its assets.

         4.07  CAPITALIZATION  The authorized capital stock of Comercis consists
of  50,000,000  shares of common stock  ("Comercis  Stock") of which  21,452,712
shares are issued and outstanding  ("Outstanding Comercis Stock"). The shares of
Outstanding Comercis Stock are duly authorized,  validly issued, fully paid, and
nonassessable.  There are no commitments, plans, arrangements to issue, options,
warrants,  security,  or other rights calling for the issuance of, any shares of
capital stock or other  ownership  interest in Comercis or any security or other
instrument  convertible  into,  exercisable  for,  or for  capital  stock  of or
ownership  in Comercis  other than those  disclosed  in Schedule  4.07  attached
hereto.

         4.08 TAX AND OTHER LIABILITIES Comercis has no liability of any nature,
accrued,  absolute  or  contingent,   secured  or  unsecured  including  without
limitation  liabilities  for payroll and other employee taxes,  federal,  state,
local,  or foreign taxes or  liabilities  to customers or suppliers,  other than
liabilities  which are  reflected  on the  Financial  Statement.  Except for the
liabilities  included  on the  Financial  Statement,  as of  the  date  of  such
Financial  Statement,  Comercis had no liabilities,  either fixed or contingent,
which would have been required to be recorded under GAAP as of such date, and to
the knowledge of Comercis no such liabilities, other than liabilities arising in
the ordinary  course of business  and/or pursuant to this Agreement have accrued
and/or will accrue between such date and the Effective Time.  Comercis has filed
all federal, state, municipal and local tax returns (whether relating to income,
sales, franchise,  withholding, real or personal property or otherwise) required
to be filed under the laws of the United States and all applicable  states,  and
has paid in full all taxes which are due  pursuant to such returns or claimed to
be due by any taxing authority or otherwise due and owing. No penalties or other
charges  are or will  become  due with  respect  to the late  filing of any such
return. To the best of the knowledge of Comercis, after due investigation,  each

<PAGE>

such tax return heretofore filed by Comercis  correctly and accurately  reflects
the amount of its tax liability thereunder. Comercis has withheld, collected and
paid  all  other  levies,  assessments,  license  fees and  taxes to the  extent
required and, with respect to payments,  to the extent that the same have become
due and payable;

         4.09 LITIGATION AND CLAIMS There is no litigation,  arbitration, claim,
governmental or other proceeding (formal or informal),  or investigation pending
or, or to the knowledge of Comercis threatened,  with respect to Comercis or any
of its business,  properties,  or assets other than those  disclosed on Schedule
4.9 attached hereto.

         4.10 PROPERTIES As of the Effective Time, Comercis will have good title
to all  properties and assets used in its business or owned by it free and clear
of all liens,  claims,  mortgages,  security interests,  pledges,  charges,  and
encumbrances other than those disclosed on Schedule 4.10 attached hereto.

         4.11 CONTRACTS AND OTHER INSTRUMENTS  Comercis is not a party to nor it
or its assets bound by any agreement of any kind,  nature or description  except
as set forth in  Schedule  4.11  attached  hereto.  Comercis is not in breach or
violation of or default under any contract or instrument to which  Comercis is a
party and/or by which its assets are bound; and no event has occurred which with
the  lapse of time or  action  by a third  party  could  result  in a breach  or
violation of or default by Comercis  under any contract or other  instrument  to
which  Comercis  is a party  of by which it or any of its  assets  are  bound or
affected,  nor is there  any  court  or  regulatory  order  pending  against  or
affecting  Comercis  and/or any of its  assets.  Comercis  is not a party to any
agreement performable in the future

         4.12 EMPLOYEES  Comercis has no employees and no welfare  benefit plans
(as defined in Section 3(3) of the Employee  Retirement  Income  Security Act of
1974 ("ERISA") or otherwise of any kind, nature or description.

         4.13 PRE CLOSING  ACTIVITY  Comercis shall not enter into or consummate
any  transactions  prior to the  Closing  other than in the  ordinary  course of
business and will pay no dividend,  or increase the compensation of any officer,
director or employee and will not enter into any  transaction or agreement which
would adversely affects its financial condition.  Comercis shall deliver to RMFE
at or  prior  to the  Closing  copies  of any and all  reports  relating  to the
financial  and/or business  condition of Comercis which are created or published
subsequent to the date hereof together with any reports or  communications  sent
to the stockholders of Comercis subsequent to the date hereof.

         4.14  ACCURACY  No  statement,  representation  or  warranty  contained
herein,  in any  certificate  delivered  pursuant to this  Agreement,  or in any
report filed with the Securities Exchange Commission (the "Commission") contains
or will contain any untrue  statement  of a material  fact or omits to state any
material fact necessary to make such statement,  representation  or warranty not
misleading.
<PAGE>

         4.15 PURCHASE FOR INVESTMENT PURPOSES ONLY The shareholders of Comercis
are  acquiring  the RMFE Common  Stock as a result of the Merger for  investment
purposes only and not with the view to the resale or distribution  thereof. Each
of  the  shareholders  of  Comercis  is  an  "accredited   investor"  under  the
regulations  promulgated  under  the  33  Act  or  otherwise  meets  one  of the
definitions for persons entitled to acquire unregistered  securities pursuant to
an  exemption  from  registration  under the 33 Act.  Neither  Comercis  nor its
shareholders have received and/or relied upon any  representations or warranties
from  RMFE  other  than  those  contained  in this  Agreement  and the  attached
schedules or exhibits hereto.  Comercis  represents and warrants that it and its
shareholders  have such  knowledge  and  experience  in  financial  and business
matters as to be capable of evaluating the merits and risks of its investment in
RMFE Common Stock. Comercis and its shareholders understand and acknowledge that
the RMFE Common Stock has not been  registered  under the Act or under any state
securities act and are being issued to the shareholders of Comercis  pursuant to
an  exemption  from  registration  under the Act. The reliance by RMFE upon such
exemption is  predicated  upon the  representations  and  warranties of Comercis
contained herein. In this regard,  Comercis and its shareholders  understand and
agrees that there may be affixed to the certificates  representing the shares of
RMFE Common Stock acquired by the  shareholders  of Comercis  hereunder a legend
advising of the unregistered, restricted nature of the shares.

         4.16  CERTIFICATE  The  representations,   warranties,   covenants  and
agreements  of  Comercis  contained  in  this  Agreement,   including,   without
limitation,  those contained in this Article IV, are true,  accurate and correct
in all  respects as of the date hereof and shall be true,  accurate  and correct
and complete,  in all respects,  as of the Closing;  and at the Closing Comercis
shall deliver to RMFE a certificate,  executed by the chief executive officer of
Comercis  remaking,   on  behalf  of  Comercis  each  of  the   representations,
warranties,  covenants and  agreements  set forth in this  Agreement,  including
without limitation, those set forth in this Article IV hereof.

                        V. COVENANTS AND OTHER AGREEMENTS

         5.01  CONDUCT  OF  BUSINESS  OF  COMERCIS  Except as  herein  expressly
provided to the  contrary or as otherwise  agreed to in writing by RMFE,  during
the period from the  execution of this  Agreement  until the earlier to occur of
the Effective  Time or the  termination  of this  Agreement as herein  provided,
Comercis will conduct its operations  according to its ordinary and usual course
of  business  and  consistent  with past  practice.  In this  regard,  except as
expressly  provided in this Agreement to the contrary or otherwise  agreed to by
RMFE in writing or as required by law or agreement,  Comercis will not,  between
the date of this Agreement and the earlier to occur of the Effective Time or the
termination of this Agreement as herein provided:
<PAGE>

(a)      Make or become obligated to make, any payment to any director, officer,
         employee, or agent;

(b)      Declare any dividend or make any other distribution to shareholders;

(c)      Incur any indebtedness for borrowed money except in the ordinary course
         of business;

(d)      Sell,  lease,  license,  encumber or dispose of any material portion of
         its properties or assets except in the ordinary course of business;

(e)      Expend  funds  for any  individual  capital  expenditure  in  excess of
         $25,0000 or aggregate capital expenditures in excess of $100,000;

(f)      Amend its certificate of incorporation or by-laws.

(g)      Change its business,  operations or financial condition,  or the manner
         of managing or conducting  its business and operations if such changes,
         if any, have a material adverse effect on such business,  operations or
         financial condition, taken as a whole;

(h)      Change  its  accounting  methods  or  practices   (including,   without
         limitation,  any change in depreciation,  amortization  and/or goodwill
         policies or rates);

(i)      Incur any  damage,  destruction  or loss  (whether  or not  covered  by
         insurance) which materially and adversely affects its assets, business,
         operations or financial condition; or

(j)      Waive or release any right or claim;

         5.02  TRANSACTION  COSTS AND EXPENSES Each of the parties  hereto shall
pay its own  respective  costs  incurred  in  connection  with this  transaction
including,  without limitation,  all legal,  accounting,  auditing and appraisal
fees in negotiating  and preparing this Agreement and in  consummating,  closing
and implementing the transactions contemplated hereby.

         5.03 SUBSEQUENT EVENTS Each of the parties hereto shall promptly advise
the other parties  hereto,  in writing of (a) the  occurrence of any event which
renders any of the  representations or warranties of such party set forth herein
inaccurate in any material respect,  and (b) the failure of such party to comply
with or accomplish,  in any material respect, any of the covenants or agreements
of such party set forth herein.

<PAGE>

         5.04     INDEMNITY

                  (a) Comercis  does hereby agree to indemnify and hold harmless
RMFE and its  employees,  officers,  directors  and  successors  against  and in
respect of any and all claims, suits, actions, proceedings (formal or informal),
governmental  investigations,   judgments,   deficiencies,   set-offs,  damages,
settlements,  liabilities,  and reasonable  legal and other expenses  (including
reasonable  attorneys' fees and defense costs) as and when incurred  arising out
of or  based  upon any  breach  by  Comercis  of any  representation,  warranty,
covenant, or agreement of Comercis contained in this Agreement;

                  (b) RMFE does  hereby  agree to  indemnify  and hold  harmless
Comercis and its employees,  officers,  directors and successors  against and in
respect of any and all claims, suits, actions, proceedings (formal or informal),
governmental  investigations,   judgments,   deficiencies,   set-offs,  damages,
settlements,  liabilities,  and reasonable  legal and other expenses  (including
reasonable  attorneys'  fees and costs of defense) as and when incurred  arising
out of or based upon any breach of any representation,  warranty,  covenant,  or
agreement of RMFE contained in this Agreement.

                  (c) The parties' respective  indemnity  obligations  hereunder
shall be subject to the following terms, limitations and conditions:

                           (i) A person claiming the right to indemnity coverage
         under this Section 5.04  ("indemnitee")  shall give the party from whom
         he or it seeks indemnity coverage  ("indemnitor")  prompt notice of the
         assertion of any indemnified  claim on the basis of which an indemnitee
         intends to seek  indemnification from an indemnitor as provided herein;
         provided,  however,  that  the  obligation  of an  indemnitor  shall be
         reduced for the failure to give timely  notice at any  particular  time
         only to the extent that the  indemnitor  has been  actually  prejudiced
         thereby;

                           (ii) The indemnitor  shall have the duty to zealously
         and  competently  defend,  with counsel  selected by  indemnitor  after
         consultation  with  the  primary  indemnitee,  any  matter  subject  to
         indemnity  coverage under  subparagraphs (a) or (b) of this section and
         to pay all  costs  of such  defense.  In any  case  where  indemnitor's
         obligation to provide a zealous  defense is  compromised by conflict of
         interest between itself and an indemnitee or between  indemnitees,  the
         indemnitor shall,  upon the request of an indemnitee,  provide separate
         legal  representation  to  obviate  the  conflict  of  interest.   When
         indemnitor  has  assumed  the  defense  obligations  of  this  section,
         indemnitor  shall  have the  right to settle  the  matter  without  the
         indemnitees'  consent,  provided  indemnitor in fact commits sufficient
         funds  to  satisfy  the  settlement  in  full.  In the  event  that  an
         indemnitor fails to defend as provided in this section,  any indemnitee
         shall  have  the  right  (but  not the  obligation)  to  select  and be
         represented  by  counsel  of  its  choice,  to  manage  its  own  legal
         representation  or  defense  and to  settle  any  claim,  debt or other
         indemnified  matter  hereunder,  and the indemnitor  shall be liable to
         such  indemnitee  for all  costs,  expenses,  damages  and  settlements
         incurred by such indemnitee;
<PAGE>

                           (iii)  With   respect  to  any  claim  for  which  an
         indemnitor  shall  indemnify any  indemnitee,  the indemnitor  shall be
         subrogated  to all rights of any  indemnitee  against any and all third
         parties up to the amount paid by indemnitor to  indemnitees  or set off
         by such indemnity against an indemnitor;

                           (iv) No  indemnitor  shall be liable for that portion
         of any  claim  for  which  an  indemnitee  actually  receives  from any
         insurance,  the defense, cost of defense or insurance proceeds covering
         such claim (the  deductible  pertaining to any such insurance shall not
         be considered to be insurance proceeds or cost of defense).

         5.05 RELATED  AGREEMENTS  Each of the parties shall execute and deliver
at Closing the related  agreements,  instruments  and  documents  specified  for
delivery  at  Closing  or the  Effective  Time in  Sections  6.02  and  6.03 and
elsewhere  in  this  agreement  or  in  a  related   agreement  to  which  each,
respectively, is a party.

         5.06  INSPECTION  At all  times  prior to the  Closing,  during  normal
business hours an upon  reasonable  notice,  each party will permit the other to
examine its books and records and the books and records of its subsidiaries,  to
discuss the same with such party's authorized  representative and to make copies
thereof and abstracts  there from. It is recognized  that each party may provide
the other with information (including, without limitation, information contained
in its books and records  and/or  pursuant to the  inspection  described  in the
preceding sentence) which is confidential or proprietary information. During the
period from the date hereof until the fourth annual  anniversary  of the Closing
(or the  termination of this Agreement if the Merger is abandoned) the recipient
of any such  information  shall  protect such  information  from  disclosure  to
persons,  other  than  members  of its own  organization  and  its  professional
advisers,  in the same manner as it protects its own confidential or proprietary
information from  unauthorized  disclosure,  and not use such information to the
competitive  detriment of the disclosing party. In addition if this Agreement is
terminated  for any  reason,  each party  shall  promptly  return or cause to be
returned  all  documents  or  other  written  records  of such  confidential  or
proprietary  information,  together  with all copies of such  writings  and,  in
addition,  shall either furnish or cause to be furnished,  or shall destroy,  or
shall  maintain with such  standard of care as is exercised  with respect to its
own  confidential  or  proprietary  information,  all copies of all documents or
other written  records  developed or prepared by such party on the basis of such
confidential  or proprietary  information.  No  information  shall be considered
confidential or proprietary if it is (a)  information  already in the possession
of the party to whom disclosure is made, (b)  information  acquired by the party
to whom disclosure is made from other sources,  or (c) information in the public
domain or  generally  available to  interested  persons or which at a later date
passes  into  the  public  domain  or  becomes  available  to the  party to whom
disclosure is made without any wrongdoing by the party to whom the disclosure is
made.

<PAGE>

                                 VI. CONDITIONS

         6.01  CONDITIONS  TO  OBLIGATION  TO EFFECT THE  MERGER The  respective
obligations  of each  party to  consummate  the  Merger  shall be subject to and
conditioned  upon  the  satisfaction  at or  prior  to the  Closing  Date of the
following conditions:

                  (a) To the extent required by the Delaware GCL and/or Colorado
law or the party's certificate of incorporation or by-laws, shareholder approval
shall have been obtained;

                  (b) No statute,  rule,  regulation,  executive order,  decree,
temporary restraining order,  preliminary or permanent injunction or other order
issued by any  court or  competent  jurisdiction  or other  governmental  entity
preventing the consummation of the Merger shall be in effect; provided that each
of the parties  shall have used  reasonable  efforts to prevent the entry of any
such  injunction  or other  order and to  appeal as  promptly  as  possible  any
injunction or other order that may be entered;

                  (c)  There  shall not have  occurred  or been  discovered  any
material  breach or  inaccuracy  of any  representation  or warranty made by any
other party in this  Agreement,  and there shall not have  occurred any material
breach of any  covenant or  obligation  required by this  Agreement or by law to
have been performed by any other party prior to the Effective Time; and

                  (d)  Each  party  shall  have   received  all   documents  and
agreements required to be delivered to it at or before the Closing.

         6.02 COMERCIS'  OBLIGATIONS  AT CLOSING At the Closing,  Comercis shall
         deliver or cause to be delivered to RMFE, in form satisfactory to RMFE,
         the following:

         (a)      A true copy of the minutes of the meeting of  Comercis'  Board
                  of Directors  approving  the Plan of Merger and the Merger and
                  authorizing  the execution,  delivery and  performance of this
                  Agreement;

         (b)      A  certificate  of good  standing for Comercis  issued  within
                  thirty (30) days prior to the Closing Date by the Secretary of
                  State of Delaware;

         (c)      All other schedules, certificates and other documents required
                  by this  Agreement or by law to be delivered by Comercis on or
                  before Closing or the Effective Time; and

         (d)      A true copy of the notice of shareholders meeting and proof of
                  service  thereof upon all Comercis'  shareholders of record in
                  accordance  with the Delaware law together with the minutes of
                  the shareholder's  meeting evidencing  shareholder approval of
                  the Plan of Merger and the execution, delivery and performance
                  of this Agreement.
<PAGE>

         6.03 RMFE'S  OBLIGATIONS  AT CLOSING At or prior to the  Closing,  RMFE
shall  deliver or cause to be  delivered to Comercis,  in form  satisfactory  to
Comercis, the following:

         (a)      A true  copy of the  minutes  of the  meeting  of the Board of
                  Directors of RMFE  adopting the  Agreement  and Plan of Merger
                  and Merger.

         (b)      An opinion of counsel to  Comercis  reasonably  acceptable  to
                  RMFE with respect to such matters and in such form as shall be
                  reasonably requested by and acceptable to Comercis;

         (c)      All of the books and records of RMFE;

         (d)      A  certificate  of good standing for RMFE issued within thirty
                  (30) days prior to the Closing Date by the  Secretary of State
                  of Colorado; and

         (e)      All other schedules, certificates and other documents required
                  by this Agreement to be delivered by RMFE on or before Closing
                  or the Effective Time;

                                VII. ABANDONMENT

         7.01   ABANDONMENT  OF  MERGER  The  rights  and   obligations  of  the
Constituent  Corporations  under this Agreement may be terminated and the Merger
abandoned  prior to the Effective  Time by the mutual  agreement of the Board of
Directors of both of the Constituent Corporations.

                               VIII. MISCELLANEOUS

         8.01  BROKERAGE  FEES No party to this  Agreement  has  consented to or
authorized any broker or agent to act on its behalf, directly or indirectly,  as
a broker or finder  in  connection  with the  transaction  contemplated  by this
Agreement.  In the event any claim is made for a  broker's  or  finder's  fee in
connection with the transactions  contemplated hereunder,  the party responsible

<PAGE>

for retaining or securing said broker or finder shall be solely  responsible for
the  payment of any  broker's  or finder's  fees  incurred as a result  thereof.
Further,  the  responsible  party or parties  shall  indemnify the other parties
against any loss or liabilities by reason of such broker's or finder's fees.

         8.02  FURTHER  ACTIONS  At any time and from time to time,  each  party
agrees,  at its  expense,  to take such  actions and to execute and deliver such
documents  as may be  reasonably  necessary to  effectuate  the purposes of this
Agreement.

         a) RMFE  agrees that as soon as it is  practicable  after the merger is
         completed  it will take all steps  necessary  to increase the number of
         authorized  shares so that there will be sufficient  shares so that all
         outstanding options,  warrants, and convertible securities will be able
         to be exercised or converted into shares of RMFE.

         8.03  SURVIVAL  Except as otherwise  provided  herein,  the  covenants,
agreements,  representations,  and  warranties  contained in or made pursuant to
this   Agreement   shall  survive  the  Effective   Time  and  any  delivery  of
consideration at Closing or the Effective Time irrespective of any investigation
made by or on behalf of any party.

         8.04  MODIFICATION  This  Agreement  and the  related  instruments  and
agreements hereto set forth the entire understanding of the parties with respect
to the subject  matter  hereof,  supersede  all existing  agreements  among them
concerning such subject matter, and may be modified only by a written instrument
duly executed by all of the parties hereto.

         8.05 NOTICES All notices,  elections,  reports or other  correspondence
required  or  permitted  hereunder  shall be in writing  and deemed to have been
properly  given or  delivered  when mailed by  certified  mail,  return  receipt
requested,  postage prepaid,  delivered by overnight  express courier,  delivery
fees prepaid, or transmitted by fax with receipt confirmed, to the party to whom
directed at the below specified addresses:

If to RMFE:
                           Michael A. Littman, Esq.
                           7609 Ralston Road
                           Arvada, CO 80002

If to Comercis:
                           Chris Meaux, President and CEO
                           Comercis, Inc.
                           500 Nolen Drive
                           Suite 300
                           Southlake, Texas 76092

With a copy to:
                           Michael M. Kessler, Esq.
                           Comercis, Inc
                           500 Nolen Drive
                           Suite 300
                           Southlake, Texas 76092

<PAGE>

Any such notice  shall be deemed  given three days after  deposit with the mail,
one day  following  delivery  thereof to an  overnight  express  courier or upon
confirmation  of receipt when sent by fax. The address of a party may be changed
in accordance with the notice provisions of this section.

         8.06  WAIVER  Any waiver by any party of a breach of any  provision  of
this Agreement  shall not operate as or be construed to be a waiver of any other
breach  of that  provision  or of any  breach  of any  other  provision  of this
Agreement. The failure of a party to insist upon strict adherence to any term of
this  Agreement on one or more  occasions  will not be  considered a waiver,  or
deprive that party, of the right  thereafter to insist upon strict  adherence to
that term or any other term of this Agreement. Any waiver must be in writing.

         8.07 BINDING EFFECT The  provisions of this Agreement  shall be binding
upon and  inure to the  benefit  of the  parties  hereto  and  their  respective
successors  and  assigns,  and in  addition  shall  inure to the  benefit of the
indemnitees  and their  respective  successors,  assigns,  heirs,  and  personal
representatives.

         8.08 NO THIRD-PARTY  BENEFICIARIES  This Agreement does not create, and
shall not be construed as creating,  any rights  enforceable by any person not a
party to this Agreement (except as provided in Section 8.07).

         8.09 SEVERABILITY AND REFORMATION If any provision of this Agreement is
invalid,  illegal, or unenforceable,  the balance of this Agreement shall remain
in effect,  and if any provision is inapplicable to any person or  circumstance,
it shall nevertheless  remain applicable to all other persons and circumstances,
in either case unless the result thereof would preclude the  consummation in all
material  respects  of  the  Merger  contemplated  by  this  Agreement  and  the
associated  transactions  or result in an unjust  modification of the balance of
rights and  obligations  hereunder.  To the extent  provided in this section,  a
court having  jurisdiction  of a matter  involving  the  interpretation  of this
Agreement  shall be  authorized to reform this  Agreement to the minimum  extent
necessary to accomplish the objectives of this section.

         8.10 HEADINGS The headings of this Agreement are solely for convenience
of reference and shall be given no effect in the construction or  interpretation
of this Agreement.

         8.11 GOVERNING LAW To the extent permitted by law, this Agreement shall
be  governed  by and  construed  in  accordance  with the  laws of the  state of
Colorado  giving effect to conflict of laws. To the maximum extent  permitted by
law and  subject  to the  provisions  of  Section  8.14  hereof,  any  action or
proceeding initiated by any party to this Agreement, any indemnitee or any other

<PAGE>

person  claiming  rights under this Agreement shall be brought in an appropriate
state or federal  court in Denver  County,  Colorado,  and any  person  claiming
rights under this  agreement  consents to the  jurisdiction  and proper venue of
such forum.

         8.12 SEPARATE  COUNTERPARTS  This  Agreement may be executed in several
identical  counterparts,  each one of which shall be  considered an original and
all of which when taken together shall constitute but one instrument.

         8.13  INCORPORATION  OF RECITALS,  EXHIBITS AND  SCHEDULES  All related
instruments  and  agreements  executed in connection  herewith are  incorporated
herein by this reference and expressly made a part of this Agreement.

         8.14  ARBITRATION  Except  in cases  where the  remedy  of  preliminary
injunction is reasonably  sought by a party  because of the  irreparability  and
immediacy  of the harm  alleged to be caused or  threatened,  in the event there
shall arise any dispute or claim in law or equity  arising out of this Agreement
or any breach  thereof or any  resulting  transaction  between the parties under
this Agreement and if such dispute cannot be resolved through  negotiation,  the
parties  agree that such dispute  shall be submitted  to  arbitration  under the
rules and regulations of the American  Arbitration  Association  then obtaining.
The arbitration shall be held in Dallas, Texas before a single arbitrator.

                [REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]

<PAGE>

         IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date of the day and year first above written.

                                      ROCKY MOUNTAIN FINANCIAL ENTERPRISES, INC.

                                      By/s/Chris Meaux
                                        Chris Meaux, President

                                      COMERCIS, INC.

                                      By/s/Chris Meaux
                                      Chris Meaux, President

<PAGE>

Schedule 4.07   Capitalization

Provided

<PAGE>

Schedule 4.09  Litigation

Provided

<PAGE>

Schedule 4.10  Properties

Provided

<PAGE>

Schedule   4.11  Contracts

Provided

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