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<FILENAME>v02991_s3.txt
<TEXT>

     As filed with the Securities and Exchange Commission on April 30, 2004

                                               REGISTRATION NO. 333-____________
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM S-3

             REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

                     PERMA-FIX ENVIRONMENTAL SERVICES, INC.
               (Exact name of registrant as specified in charter)


           DELAWARE                                        58-1954497
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)


                            1940 NORTHWEST 67TH PLACE
                           GAINESVILLE, FLORIDA 32653
                                 (352) 373-4200
               (Address, including zip code, and telephone number,
        including area code, of registrant's principal executive office)

                             DR. LOUIS F. CENTOFANTI
                              CHAIRMAN OF THE BOARD
                     PERMA-FIX ENVIRONMENTAL SERVICES, INC.
                            1940 NORTHWEST 67TH PLACE
                           GAINESVILLE, FLORIDA 32653
                                 (352) 373-4200
               (Address, including zip code, and telephone number,
                   including area code, of agent for service)

                                    Copy to:

                           IRWIN H. STEINHORN, ESQUIRE
                             CONNER & WINTERS, P.C.
                        ONE LEADERSHIP SQUARE, SUITE 1700
                               211 NORTH ROBINSON
                          OKLAHOMA CITY, OKLAHOMA 73102
                                 (405) 272-5711


      Approximate  date of commencement of proposed sale to the public:  AS SOON
AS PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.

      If the only  securities  being  registered  on this form are being offered
pursuant  to a  dividend  or  interest  reinvestment  plans,  please  check  the
following box: |_|

      If any of the securities  being  registered on this Form are to be offered
on a delayed or continuous  basis  pursuant to Rule 415 under the Securities Act
of 1933,  other than  securities  offered only in  connection  with  dividend or
interest reinvestment plans, check the following box: |X|

      If this Form is filed to register  additional  securities  for an offering
pursuant to Rule 462(b) under the  Securities  Act,  check the following box and
list the Securities Act registration  statement number of the earlier  effective
registration statement for the same offering: |_|

      If this Form is a  post-effective  amendment filed pursuant to Rule 462(c)
under the  Securities  Act,  check the following box and list the Securities Act
registration  statement number of the earlier effective  registration  statement
for the same offering: |_|

      If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box: |_|

<PAGE>

      THE REGISTRANT HEREBY AMENDS THIS  REGISTRATION  STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER  AMENDMENT  WHICH  SPECIFICALLY  STATES  THAT  THIS  REGISTRATION
STATEMENT SHALL  THEREAFTER  BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES  ACT OF 1933 OR UNTIL THIS  REGISTRATION  STATEMENT  SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION,  ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

<TABLE>
<CAPTION>

                                                   CALCULATION OF REGISTRATION FEE
=============================== ====================== ======================= ===================== ================
                                                              PROPOSED               PROPOSED
     TITLE OF EACH CLASS              NUMBER OF               MAXIMUM                MAXIMUM            AMOUNT OF
     OF SECURITIES TO BE            SHARES TO BE           OFFERING PRICE           AGGREGATE         REGISTRATION
          REGISTERED                 REGISTERED              PER SHARE            OFFERING PRICE           FEE
------------------------------- ---------------------- ----------------------- --------------------- ----------------
<S>                                 <C>                       <C>                 <C>                    <C>
Common Stock                        6,391,751(1)              $2.08(2)            $13,294,842(2)         $1,685
=============================== ====================== ======================= ===================== ================
</TABLE>

(1)   Includes (a)  4,616,113  shares  which have been issued by the  Registrant
      pursuant to a private  placement and (b) 1,775,638  shares issuable by the
      Registrant upon the exercise of various  warrants issued by the Registrant
      in the  private  placement  having an  exercise  price of $2.92 per share.
      Pursuant to Rule 416 under the  Securities  Act of 1933,  as amended,  the
      number of shares  of common  stock  registered  hereby  shall  include  an
      indeterminate  number  of shares  of  common  stock  that may be issued in
      connection with a stock split, stock dividend, recapitalization or similar
      event.

(2)   Estimated  solely for the purposes of calculating the  registration fee in
      accordance  with Rule  457(c) on the basis of the  average of the high and
      low price as quoted on the NASDAQ Small Cap Market on April 26, 2004.

<PAGE>

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

THE  INFORMATION  IN THIS  PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.  THESE
SECURITIES MAY NOT BE SOLD UNTIL THE RELATED  REGISTRATION  STATEMENT FILED WITH
THE SEC IS EFFECTIVE.  THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE  SECURITIES
AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE
OFFER OR SALE IS NOT PERMITTED.

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

                   SUBJECT TO COMPLETION: DATED APRIL 30, 2004

PROSPECTUS

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

                     [PERMAFIX ENVIRONMENTAL SERVICES LOGO]

                                6,391,751 SHARES

                     PERMA-FIX ENVIRONMENTAL SERVICES, INC.

                                  COMMON STOCK

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

      This prospectus  relates to the offer or sale of up to 6,391,751 shares of
Perma-Fix  Environmental  Services,  Inc.  common stock from time to time by the
Selling Stockholders listed in this prospectus. We will not receive any proceeds
from the sale of such shares by the Selling Stockholders.

      Our common stock is traded on the Nasdaq  SmallCap Market under the symbol
"PESI" and on the Boston  Stock  Exchange  under the symbol  "PES." On April 26,
2004,  the closing price of our common stock as reported on the Nasdaq  SmallCap
Market was $2.06.

      We have agreed to pay all the costs and fees relating to the  registration
of the  shares  covered  by  this  prospectus.  However,  we  will  not  pay any
discounts,  concessions,  or commissions  payable to underwriters,  dealers,  or
agents incident to the offering of such shares or the fees and expenses incurred
by counsel for the Selling Stockholders.

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

         INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK.
          SEE "RISK FACTORS" BEGINNING ON PAGE 2 OF THIS PROSPECTUS FOR
                       CERTAIN RISKS YOU SHOULD CONSIDER.

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

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
   COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE
      ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
                                CRIMINAL OFFENSE.

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


                The date of this prospectus is __________, 2004.

<PAGE>

                                TABLE OF CONTENTS

ABOUT OUR BUSINESS.............................................................1
RISK FACTORS...................................................................2
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS.............................10
RECENT DEVELOPMENTS...........................................................10
USE OF PROCEEDS...............................................................12
SELLING STOCKHOLDERS..........................................................12
PLAN OF DISTRIBUTION..........................................................15
LEGAL OPINION.................................................................16
EXPERTS.......................................................................16
WHERE YOU CAN FIND MORE INFORMATION...........................................16



      Unless the context  otherwise  requires,  references in this prospectus to
"Perma-Fix,"   "the   company,"   "we,"  "our,"  and  "us"  refer  to  Perma-Fix
Environmental Services, Inc. and its consolidated subsidiaries.


                                       i

<PAGE>

                               ABOUT OUR BUSINESS

      We are  engaged,  through  our  subsidiaries,  in the  following  lines of
business:

                      INDUSTRIAL WASTE MANAGEMENT SERVICES

      Our Industrial Waste Management Services include:

      o     treatment,  storage,  processing,  and  disposal  of  hazardous  and
            non-hazardous waste;

      o     industrial waste and wastewater  management services,  including the
            collection,  treatment,  processing  and disposal of  hazardous  and
            non-hazardous waste; and

      o     various waste management services to certain governmental agencies.

      These services are primarily  conducted  through eight of our subsidiaries
and through various locations within our government services group:

      o     Perma-Fix Treatment Services, Inc. located in Tulsa, Oklahoma;

      o     Perma-Fix of Dayton, Inc. located in Dayton, Ohio;

      o     Perma-Fix of Ft. Lauderdale, Inc. located in Davie, Florida;

      o     Perma-Fix of Orlando, Inc. located in Orlando, Florida;

      o     Perma-Fix of South Georgia, Inc. located in Valdosta, Georgia;

      o     Perma-Fix of Michigan, Inc. located in Detroit, Michigan;

      o     Perma-Fix of Maryland, Inc. located in Baltimore, Maryland; and

      o     Perma-Fix of Pittsburgh, Inc. located in Pittsburgh, Pennsylvania.

                        NUCLEAR WASTE MANAGEMENT SERVICES

      Our Nuclear Waste Management Services include:

      o     treatment,  storage,  processing  and disposal of mixed waste (waste
            containing both low-level radioactive and hazardous waste); and

      o     nuclear and low-level  radioactive  waste treatment,  processing and
            disposal, which includes research,  development, and on and off-site
            waste remediation and processing.

      These services are primarily conducted through three of our subsidiaries:

      o     Perma-Fix of Florida, Inc. located in Gainesville, Florida;

      o     Diversified   Scientific   Services,   Inc.   located  in  Kingston,
            Tennessee; and

      o     East  Tennessee  Materials  and  Energy  Corporation  located in Oak
            Ridge, Tennessee.

                         CONSULTING ENGINEERING SERVICES

      Our Consulting  Engineering  Services  include  broad-scope  environmental
issues, including:

      o     environmental management programs

      o     regulatory permitting

      o     compliance and auditing

      o     field testing and characterization


                                       1
<PAGE>


      These services are primarily conducted through our subsidiary,  Schreiber,
Yonley & Associates, Inc., located in St. Louis, Missouri.

      We have grown  through both  acquisitions  and internal  development.  Our
present objective is to focus on the operations, maximize profitability,  and to
continue  the  research  and  development  of  innovative  technologies  for the
treatment of nuclear, mixed and industrial waste.

      We service research institutions,  commercial companies, public utilities,
and governmental agencies nationwide. The distribution channels for services are
through direct sales to customers or via intermediaries.

      We were  incorporated  in the State of  Delaware  in  December  1990.  Our
executive  offices are located at 1940 N.W.  67th  Place,  Gainesville,  Florida
32653,  and our telephone  number is (352)  373-4200.  Our website is located at
www.perma-fix.com.  The information contained in our website is not incorporated
by reference in this prospectus.


                                  RISK FACTORS

      Investing in our securities  involves a high degree of risk. Before making
an investment decision, you should carefully consider the risk factors set forth
in this prospectus and any  accompanying  prospectus  supplement  delivered with
this  prospectus,  as well as other  information  we include or  incorporate  by
reference in this prospectus and any accompanying  prospectus supplement and the
additional  information  in the other  reports we file with the  Securities  and
Exchange Commission ("SEC").

OUR SUBSTANTIAL AMOUNT OF DEBT COULD ADVERSELY AFFECT OUR OPERATIONS.


      We have a  substantial  amount of debt.  At March 31, 2004,  our aggregate
consolidated  debt was  approximately  $20.9  million.  If our floating rates of
interest  experienced an upward  increase of 1%, our debt service would increase
by approximately  $209,000 annually.  Our secured revolving credit facility (the
"Credit  Facility")  provides  for  an  aggregate  commitment  of  $25  million,
consisting  of an $18  million  revolving  line of credit  and a term loan of $7
million.  The  maximum  we can  borrow  under the  revolving  part of the Credit
Facility  is based on a  percentage  of the amount of our  eligible  receivables
outstanding at any one time. The Credit Facility is due December, 2005. Although
we used a  substantial  portion  of the net  proceeds  received  from a recently
completed private placement (see "Recent  Developments - Private  Placement") to
reduce our  indebtedness  under the revolving  part of the Credit  Facility,  we
intend to continue to borrow  under that  facility  from time to time,  and this
reduction did not reduce the amount we can borrow under the Credit Facility.  As
of March 31, 2004,  we had  borrowings  under our  revolving  part of our Credit
Facility of $1.7 million and borrowing availability of up to an additional $11.4
million based on our then outstanding eligible receivables.

      Our high leverage could have material adverse  consequences on our ability
to operate our business, including the following:

      o     it may make it  difficult  for us to  satisfy  our  obligations  and
            contractual and commercial commitments

      o     our  ability  to  obtain  additional  financing  in the  future  for
            refinancing  indebtedness,  acquisitions,  working capital,  capital
            expenditures or other purposes may be impaired;

      o     funds  available  to us for our  operations  and  general  corporate
            purposes  or for  capital  expenditures  will be  reduced  because a
            substantial  portion of our  consolidated  cash flow from operations
            will be  dedicated to the payment of the  principal  and interest on
            our indebtedness;

      o     we may be more highly  leveraged  than  certain of our  competitors,
            which may place us at a competitive disadvantage;

      o     we  may  be  more  vulnerable  to a  downturn  in  general  economic
            conditions;

      o     certain of the borrowings  under our debt  agreements  have floating
            rates of interest,  which cause us to be  vulnerable to increases in
            interest rates; and


                                       2
<PAGE>


      o     we must use a substantial  portion of our cash flow from  operations
            to pay  interest  on  our  indebtedness,  which  reduces  the  funds
            available to us for other purposes.

      Our ability to make  principal  and  interest  payments,  or to  refinance
indebtedness,  will depend on both our and our  subsidiaries'  future  operating
performance and cash flow. Prevailing economic conditions, interest rate levels,
and financial, competitive, business, and other factors affect us. Many of these
factors are beyond our control.

THE  DOCUMENTS  GOVERNING  OUR  INDEBTEDNESS  RESTRICT  OUR ABILITY TO ENGAGE IN
CERTAIN BUSINESS TRANSACTIONS.

      The terms of the Credit  Facility  restrict our ability and the ability of
our subsidiaries, without the lender's approval, to, among other things:

      o     incur or guarantee additional indebtedness;

      o     pay cash dividends on, redeem or repurchase capital stock;

      o     make certain investments;

      o     incur or permit to exist liens;

      o     make material changes in the nature or conduct of our business;

      o     merge or consolidate with or acquire  substantially all of the stock
            or assets of other companies; and

      o     transfer or sell assets.

      The Credit Facility also requires that we meet specified  financial ratios
and financial  condition tests. Our ability to make additional  borrowings under
the Credit Facility depends upon satisfaction of these covenants. Our ability to
meet these  covenants  and  requirements  may be affected  by events  beyond our
control.

      Our failure to comply with  obligations  under the Credit  Facility  could
result in an event of default  under the  facility.  A default,  if not cured or
waived, could permit acceleration of our indebtedness. We cannot be certain that
we will be able to remedy any default.  If our  indebtedness is accelerated,  we
cannot be  certain  that we will have  funds  available  to pay the  accelerated
indebtedness  or that we will have the  ability  to  refinance  the  accelerated
indebtedness on terms favorable to us or at all.

THE  CONVERSION  OF  OUR  CONVERTIBLE   PREFERRED  STOCK  AND  EXERCISE  OF  OUR
OUTSTANDING  WARRANTS  AND OPTIONS  COULD  CAUSE THE MARKET  PRICE OF OUR COMMON
STOCK  TO  FALL  AND  MAY  HAVE  DILUTION  AND  OTHER  EFFECTS  ON OUR  EXISTING
STOCKHOLDERS.

      The conversion of our outstanding Series 17 Class Q Convertible  Preferred
Stock, par value $.001 per share (the "Series 17 Preferred") could result in the
issuance of up to  1,666,667  shares of common  stock at a  conversion  price of
$1.50 per share of common  stock,  subject  to  adjustment  pursuant  to certain
anti-dilution  provisions.  The exercise of our outstanding warrants and options
into common stock could result in the issuance of up to approximately 12,980,493
shares  and  3,139,950  shares,  respectfully  (assuming  that all  options  and
warrants are  currently  exercisable).  The exercise  prices of the  outstanding
warrants and options  range from $1.00 per share to $3.25 per share,  subject to
adjustment pursuant to certain anti-dilution provisions. Consequently, upon such
issuances,  our stockholders  could  experience a significant  dilution of their
investment. Dilution of our common stock may potentially have a material adverse
impact on our  earnings  per share and could,  among other  things,  depress the
price of our common stock. This result could detrimentally affect our ability to
raise additional equity capital.

      The conversion of our outstanding  Series 17 Preferred and the exercise of
all  of  our  outstanding  warrants  and  options  could  result  in  us  having
outstanding  a  total  of  59,214,835  shares  of  common  stock,  assuming  all
outstanding  warrants  and  options  are  currently  exercisable  and subject to
adjustment pursuant to certain  anti-dilution  provisions.  Such issuances would
significantly  reduce the percentage ownership of our existing and future common
stockholders.

      Many of the beneficial holders of our convertible  preferred stock and the
holders of many of our outstanding warrants and options may immediately sell the
full  amount  of  common  stock  received  upon  conversion  of the  convertible
preferred  stock and exercise of the warrants and  options,  as  applicable,  as
those shares of common stock are subject to  effective  registration  statements
that are currently in effect.  As these shares are sold, the price of the common
stock may decrease.


                                       3
<PAGE>


CAPITAL  BANK'S  INVESTORS   BENEFICIALLY  OWN  A  SIGNIFICANT   NUMBER  OF  OUR
OUTSTANDING  SHARES,  HAVE THE RIGHT TO ACQUIRE  ADDITIONAL SHARES, AND HAVE THE
ABILITY TO RESELL SUCH SHARES,  WHICH MAY ADVERSELY  AFFECT OUR ABILITY TO RAISE
ADDITIONAL FUNDS AND TO UNDERTAKE CERTAIN TRANSACTIONS.

      As of April 22, 2004, Capital Bank-Grawe Gruppe AG ("Capital Bank"), owned
of record, as agent for certain of its investors, 7,246,045 shares of our common
stock or approximately  17.5% of the outstanding shares of common stock, and had
the right to acquire an additional  4,334,805 shares of common stock pursuant to
the  convertible  preferred  stock and warrants held in Capital  Bank's name, as
agent for certain investors. If Capital Bank acquires all of the shares issuable
pursuant to such preferred stock and warrants,  Capital Bank would own of record
11,580,850  shares of common  stock,  representing  25.3% of our then issued and
outstanding common stock,  assuming we issue no other shares of common stock and
Capital  Bank does not  dispose  of any  shares.  We receive  proceeds  from the
exercise for cash of the warrants held by Capital Bank's investors,  but we will
not  receive  any  proceeds  from the resale of these  shares by Capital  Bank's
investors.

      A substantial  amount of the shares  beneficially  owned by Capital Bank's
investors are registered for resale. To the extent that Capital Bank's investors
sell these shares at times when we are attempting to raise  additional  capital,
our ability to raise these additional funds may be adversely impacted.

      We are not aware of any agreement or  understanding  among Capital  Bank's
investors to act as a group (as defined in Rule  13d-5(b)  under the  Securities
Exchange Act of 1934,  as amended (the  "Exchange  Act")).  However,  if Capital
Bank's  investors agree to act as a group or otherwise to act in concert for the
purpose of voting on matters subject to stockholder  vote, our management  could
be greatly  impacted.  For instance,  this investor group could instruct Capital
Bank to vote for or against the approval of a merger or other proposal requiring
stockholder  approval.  As a result,  the ability of our other  stockholders  to
influence our  management  and policies  could be limited,  and their ability to
realize  opportunities  to sell  some  or all of  their  stock  at  prices  that
represent a premium over market prices could be lost.

THE  ISSUANCE  OF  ADDITIONAL  SHARES OF OUR COMMON  STOCK MAY ALSO  RESULT IN A
CHANGE IN CONTROL.

      The issuance of additional  shares of our common stock upon  conversion of
the Series 17 Preferred and exercise of our currently outstanding warrants could
result in a substantial number of shares being held by one or more groups acting
in concert.  In that event, such group or groups may have the ability to cause a
change in control under our Credit Agreement.  Our Credit Facility provides that
a change of control will occur if (a) Dr.  Louis F.  Centofanti,  our  Chairman,
President,  and  Chief  Executive  Officer,  or  Richard  T.  Kelecy,  our Chief
Financial   Officer,   ceases  to  serve  as  a  senior  executive   officer  in
substantially  the same capacity as served on the date of the Credit Facility or
(b) the  persons  who were  members  of our Board on the  closing  of the Credit
Facility cease to constitute 50% of our Board.  Each of these events could be an
event of default under the terms of the credit facility.

      The  terms of the  Purchase  Agreement  covering  our  subordinated  notes
provide that if Dr.  Centofanti  ceases to be our President and Chief  Executive
Officer,  the holders of the subordinated notes have the option to require us to
prepay all amounts owing under the  subordinated  notes.  As of the date of this
prospectus,  we owe  under the  subordinated  notes  the  principal  sum of $5.6
million,  which  principal  sum is due in full on July 31,  2006.  The  Purchase
Agreement  covering the  subordinated  notes also provides that if any person or
group is  successful in electing its nominees to 50% or more of the positions on
our Board, then the holders of the Subordinated Notes have the option to require
us to prepay all amounts owing under the Subordinated  Notes,  plus a prepayment
premium.

      If anyone or a group  were to  successfully  attempt to cause any of these
changes  in our  management  or  Board,  we could be in  default  under our loan
agreements.

IF WE ARE UNABLE TO  MAINTAIN  OUR DOE  SUBCONTRACTS,  OR THE  SUBCONTRACTS  ARE
DELAYED, WE COULD LOSE A PRIMARY REVENUE SOURCE.

      Currently,  a  material  amount  of our  nuclear  segment's  revenues  are
generated  pursuant to subcontracts under contracts with the U. S. Department of
Energy (the "DOE"). Each subcontract provides that the contractor, on its or the
DOE's behalf,  may terminate or delay each contract under which the subcontracts
were  issued at any time by  notifying  us. If we fail to  maintain,  renew,  or
replace these  contracts,  our revenues  could be materially  reduced,  and your
investment  could be materially  and  adversely  affected.  We have  significant
revenues  under  subcontracts  granted to our nuclear  segment by Bechtel Jacobs
Company, LLC, a contractor to the DOE, which were approximately $13,139,000, and
$9,664,000,  representing  15.5% and 11.6%,  respectively,  of our  consolidated
revenues for 2003 and 2002.


                                       4
<PAGE>


THE INABILITY TO COMPLETE  EXISTING  GOVERNMENT  CONTRACTS OR WIN NEW GOVERNMENT
CONTRACTS OVER AN EXTENDED PERIOD COULD HARM OUR OPERATIONS AND ADVERSELY AFFECT
OUR FUTURE REVENUES.

      Most  of our  government  contracts  or  our  subcontracts  granted  under
government  contracts  are  awarded  through  a  regulated  competitive  bidding
process.  Some government contracts are awarded to multiple  competitors,  which
increases  overall  competition and pricing  pressure and may require us to make
sustained   post-award  efforts  to  realize  revenues  under  these  government
contracts.  In addition,  government  clients can generally  terminate or modify
their  contracts  at their  convenience.  The  inability  to  complete  existing
government  contracts or win new government  contracts  over an extended  period
could harm our operations and adversely affect our future revenues.

IF WE  CANNOT  MAINTAIN  OUR  GOVERNMENTAL  PERMITS  OR CANNOT  OBTAIN  REQUIRED
PERMITS, WE MAY NOT BE ABLE TO CONTINUE OR EXPAND OUR OPERATIONS.

      We are a waste management  company.  Our business is subject to extensive,
evolving,  and increasingly  stringent federal,  state, and local  environmental
laws and  regulations.  Such federal,  state, and local  environmental  laws and
regulations govern our activities regarding the treatment,  storage,  recycling,
disposal,  and transportation of hazardous and non-hazardous waste and low-level
radioactive  waste.  We  must  obtain  and  maintain  permits,  licenses  and/or
approvals  to  conduct  these  activities  in  compliance  with  such  laws  and
regulations.  Failure to obtain and  maintain  the  required  permits,  licenses
and/or  approvals  would have a material  adverse  effect on our  operations and
financial  condition.  If we are unable to maintain our currently  held permits,
licenses,  and/or  approvals or obtain any additional  permits,  licenses and/or
approvals which may be required as we expand our operations,  we may not be able
to continue certain of our operations.  See "Risk Factors - Our Industrial waste
management  services  and  nuclear  waste  management  services  subject  us  to
potential environmental liability."

CHANGES IN ENVIRONMENTAL  REGULATIONS AND ENFORCEMENT  POLICIES COULD SUBJECT US
TO ADDITIONAL  LIABILITY AND  ADVERSELY  AFFECT OUR ABILITY TO CONTINUE  CERTAIN
OPERATIONS.

      Because the environmental industry continues to develop rapidly, we cannot
predict the extent to which our operations may be affected by future enforcement
policies as applied to existing laws, by changes to current  environmental  laws
and regulations,  or by the enactment of new environmental laws and regulations.
Any  predictions  regarding  possible  liability under such laws are complicated
further by current  environmental  laws which  provide  that we could be liable,
jointly and severally, for certain activities of third parties over whom we have
limited or no control.

IF WE ARE  UNABLE TO  MAINTAIN  PROFITABILITY,  WE MAY BE UNABLE TO COMPLY  WITH
CERTAIN GOVERNMENT  REGULATIONS AND COULD BECOME SUBJECT TO SUBSTANTIAL FINES OR
LOSE OUR PERMITS.

      The standards  imposed by federal,  state,  and local  environmental  laws
require us to incur additional expenses as necessary to upgrade our facility. If
we are unable to continue to be profitable on a long-term  basis, our ability to
remain in  compliance  with  various  federal,  state,  and local  environmental
regulations  would be impaired.  Violation  of such  federal,  state,  and local
regulations could result in the loss of one or more of our permits or subject us
to substantial fines, penalties, or other liabilities that could have a material
adverse impact on our financial condition and our ability to continue certain of
our operations.

OUR INDUSTRIAL WASTE MANAGEMENT  SERVICES AND NUCLEAR WASTE MANAGEMENT  SERVICES
SEGMENTS SUBJECT US TO POTENTIAL ENVIRONMENTAL LIABILITY.

      Our business of rendering services in connection with management of waste,
including  certain  types of hazardous  waste and low-level  radioactive  waste,
subjects us to risks of liability for damages.  Such  liability  could  involve,
without limitation:

      o     claims  for  clean-up  costs,  personal  injury  or  damage  to  the
            environment  in  cases in  which  we are  held  responsible  for the
            release of hazardous or radioactive materials;


                                       5
<PAGE>


      o     claims of employees, customers, or third parties for personal injury
            or property damage occurring in the course of our operations; and

      o     claims alleging  negligence or  professional  errors or omissions in
            the planning or performance of our services.

      Our operations are subject to numerous environmental laws and regulations.
We have in the past, and could in the future,  be subject to substantial  fines,
penalties,  and sanctions for violations of  environmental  laws and substantial
expenditures  as a responsible  party for the cost of  remediating  any property
which may be contaminated by hazardous  substances  generated by us and disposed
at such  property  or  transported  by us to a site  selected  by us,  including
properties we own or lease.

      During  the  first  quarter  of  2004,  we  discovered  that  one  of  our
subsidiaries   has  been  storing  a   substantial   amount  of  hazardous   and
non-hazardous  waste in violation of certain  environmental laws. We voluntarily
reported this matter to the appropriate state governmental  authorities and have
removed this waste to permitted treatment,  storage,  and/or disposal facilities
("TSD facilities"). As of the date of this prospectus, the state has not advised
us as to what  action  or  actions,  if any,  it  intends  to take  against  our
subsidiary as a result of this matter. The state could assert monetary fines and
penalties or take other action against our subsidiary as a result of this matter
(including,  but not  limited to,  loss of  permits),  which may have a material
adverse effect upon us.

AS OUR OPERATIONS EXPAND, WE MAY BE SUBJECT TO INCREASED LITIGATION, WHICH COULD
HAVE A NEGATIVE IMPACT ON OUR FUTURE FINANCIAL RESULTS.

      Our  operations  are regulated by numerous laws  regarding  procedures for
waste treatment,  storage, recycling,  transportation,  and disposal activities,
all of which may provide the basis for  litigation  against us. In recent years,
the waste treatment industry has experienced a significant increase in so-called
"toxic-tort"  litigation as those injured by  contamination  seek to recover for
personal  injuries or property  damage.  We believe that as our  operations  and
activities  expand,  there  will be a  similar  increase  in the  potential  for
litigation  alleging  that we are  responsible  for  contamination  or pollution
caused  by  our  normal  operations,  negligence  or  other  misconduct,  or for
accidents,  which  occur  in  the  course  of  our  business  activities.   Such
litigation,  if significant and not adequately insured against,  could adversely
affect  our  financial  condition  and  our  ability  to  fund  our  operations.
Protracted  litigation would likely cause us to spend significant amounts of our
time,  effort, and money. This could prevent our management from focusing on our
operations and expansion.


                                       6
<PAGE>


IF WE CANNOT MAINTAIN ADEQUATE INSURANCE COVERAGE, WE WILL BE UNABLE TO CONTINUE
CERTAIN OPERATIONS.

      Our business  exposes us to various  risks,  including  claims for causing
damage to property  and  injuries to persons  that may  involve  allegations  of
negligence  or  professional  errors  or  omissions  in the  performance  of our
services.  Such  claims  could be  substantial.  We believe  that our  insurance
coverage is  presently  adequate and similar to, or greater  than,  the coverage
maintained  by other  companies in the industry of our size. If we are unable to
obtain  adequate  or  required  insurance  coverage  in the  future  or,  if our
insurance is not  available at  affordable  rates,  we would  violate our permit
conditions  and  other  requirements  of  the  environmental  laws,  rules,  and
regulations  under which we operate.  Such violations  would render us unable to
continue  certain of our operations.  These events would have a material adverse
effect on our financial condition.

OUR  OPERATIONS  ARE SUBJECT TO SEASONAL  FACTORS,  WHICH CAUSE OUR  REVENUES TO
FLUCTUATE.


      We have  historically  experienced  reduced revenues and losses during the
first and fourth  quarters  of our fiscal  years due to a seasonal  slowdown  in
operations from poor weather  conditions and overall reduced  activities  during
these  periods.  This trend has  continued  through  the first  quarter of 2004.
During the first quarter of 2004, we had unaudited revenues of $17.5 million and
net loss  applicable  to common  stockholders  of $2.0  million,  as compared to
unaudited   revenues  of  $19.5  million  and  net  loss  applicable  to  common
stockholders  of $431,000 for the first quarter of 2003. See below "Risk Factors
- Our Industrial  waste management  services  segment has sustained  substantial
losses,  which,  if  continuing,  may have a  material  adverse  effect  on your
investment  in our common  stock."  During our second and third fiscal  quarters
there has historically been an increase in revenues and operating profits. If we
do not continue to have increased  revenues and profitability  during the second
and third  fiscal  quarters,  this will have a  material  adverse  effect on our
results of operation and liquidity.

OUR  INDUSTRIAL  WASTE  MANAGEMENT  SERVICES  SEGMENT HAS SUSTAINED  SUBSTANTIAL
LOSSES  WHICH,  IF  CONTINUING,  COULD  HAVE A MATERIAL  ADVERSE  EFFECT ON YOUR
INVESTMENT IN OUR COMMON STOCK.

      The  revenues  from  our  industrial  waste  management  services  segment
constituted  approximately 52.1% and 45.1% of our consolidated  revenues in 2003
and 2002, respectively,  and 41.6% of our consolidated revenues during the first
quarter of 2004. Our industrial  waste  management  services  segment  sustained
losses  in 2003  and  2002 of  approximately  $2.0  million  and  $3.9  million,
respectively.  This segment has also sustained an unaudited loss of $2.5 million
for the first  quarter of 2004,  as compared  to a loss of  $828,000  during the
first quarter of 2003. This segment is generally  adversely affected by economic
downturns,  due, in part, to reductions in industrial  production that result in
reduced  levels of  hazardous  and  non-hazardous  waste.  We  believe  that the
revenues and profits in this segment were negatively impacted by the downturn in
our economy that began in 2001 and continued during part of the first quarter of
2004.

      During the fourth  quarter of 2003,  we completed a  restructuring  of our
industrial waste management services segment, changing this segment's management
and  increasing  its  focus  on  higher-margin  generator  direct  revenues  and
eliminating  lower-margin  outside  broker  revenues.   During  March  2004,  we
completed  certain  acquisitions  in the industrial  waste  management  services
segment. See "Recent Developments - Acquisitions."

      If our  industrial  waste  management  services  segment  fails to  become
profitable on an annualized basis in the foreseeable  future,  this could have a
material  adverse  effect  on our  results  of  operations,  liquidity  and  our
potential growth.

IF WE ARE UNABLE TO PROTECT  OUR  PROPRIETARY  TECHNOLOGY,  OUR GROWTH  COULD BE
LIMITED.

      Our success is  dependent  upon our ability to  maintain  our  proprietary
technologies.  There can be no  assurance  that the steps taken by us to protect
our proprietary  technologies  will be adequate to prevent  misappropriation  of
these  technologies  by  third  parties.  Misappropriation  of  our  proprietary
technology  could  have  an  adverse  effect  on our  operations  and  financial
condition.  Changes to current  environmental  laws and  regulations  also could
limit the use of our proprietary technology.

LOSS OF CERTAIN KEY PERSONNEL COULD HAVE A MATERIAL ADVERSE EFFECT ON US.

      Our  success  depends  on  the   contributions   of  our  key  management,
environmental  and engineering  personnel,  especially Dr. Louis F.  Centofanti,
Chairman,  President,  and Chief Executive  Officer.  The loss of Dr. Centofanti
could have a material adverse effect on our operations, revenues, prospects, and
our ability to raise additional funds. Our future success depends on our ability
to retain and expand our staff of qualified personnel,  including  environmental
specialists and technicians,  sales personnel, and engineers.  Without qualified
personnel,  we may incur delays in rendering our services or be unable to render
certain services. We cannot be certain that we will be successful in our efforts
to attract and retain qualified  personnel as their  availability is limited due
to the demand for hazardous waste management services and the highly competitive
nature of the hazardous waste management industry. We do not maintain key person
insurance on any of our employees, officers, or directors.

IF  ENVIRONMENTAL  REGULATION  OR  ENFORCEMENT  IS  RELAXED,  THE DEMAND FOR OUR
SERVICES WILL DECREASE.

      The demand for our services is  substantially  dependent upon the public's
concern  with,  and  the  continuation  and   proliferation  of,  the  laws  and
regulations  governing  the  treatment,  storage,  recycling,  and  disposal  of
hazardous,  non-hazardous,  and low-level  radioactive  waste. A decrease in the
level of public  concern,  the  repeal or  modification  of these  laws,  or any
significant  relaxation  of  regulations  relating  to the  treatment,  storage,
recycling, and disposal of hazardous waste and low-level radioactive waste would
significantly  reduce  the  demand  for our  services  and could have a material
adverse effect on our operations  and financial  condition.  We are not aware of
any current federal or state  government or agency efforts in which a moratorium
or  limitation  has been,  or will be, placed upon the creation of new hazardous
waste  regulations that would have a material adverse effect on us; however,  no
assurance  can be  made  that  such  a  moratorium  or  limitation  will  not be
implemented in the future.


                                       7
<PAGE>


OUR OPERATIONS WILL SUFFER IF WE ARE UNABLE TO MANAGE OUR GROWTH.

      We  are  currently  experiencing  a  period  of  growth  through  internal
expansion and strategic acquisitions,  including two acquisitions in March 2004.
See "Recent  Developments --  Acquisitions."  This growth has placed,  and could
continue to place, a significant strain on our management,  personnel, and other
resources.  Our growth  requires  us to  effectively  manage  our  collaborative
arrangements  and to  continue  to  improve  our  operational,  management,  and
financial systems and controls,  and to successfully train, motivate, and manage
our  employees.  If we are unable to effectively  manage our growth,  we may not
realize the  expected  benefits of such growth,  and such  failure  could have a
material adverse effect on our operations and financial condition.

WE DO NOT INTEND TO PAY DIVIDENDS ON OUR COMMON STOCK IN THE FORESEEABLE FUTURE.

      Since our inception,  we have not paid cash dividends on our common stock,
and we do not anticipate paying any cash dividends in the foreseeable future. We
intend to retain  future  earnings,  if any, to provide  funds for the operation
and/or expansion of our business.

      The terms of the  Series 17  Preferred  allow us to pay  dividends  on the
outstanding  Series 17 Preferred in cash or common stock. We currently intend to
pay the  dividends  accruing on the Series 17  Preferred in common stock if, and
when,  declared and paid by our Board of Directors.  The actual number of shares
of common  stock  issuable  in  payment of  accrued  dividends  on the Series 17
Preferred  will  depend  upon the  length  of time the  Series 17  Preferred  is
outstanding  and the  price  of the  common  stock  at the  time of  payment  of
dividends.   Our  Credit  Facility  prohibits  us  from  paying  cash  dividends
(including cash dividends on our Series 17 Preferred) without the lender's prior
written consent.

EXPIRATION OF THE  PRICE-ANDERSON  ACT'S  INDEMNIFICATION  AUTHORITY  COULD HAVE
ADVERSE  CONSEQUENCES ON OUR POWER,  DEFENSE,  AND ENERGY & ENVIRONMENT BUSINESS
UNITS.

      We provide  services  to the  nuclear  industry.  The  Price-Anderson  Act
promotes the nuclear  industry by offering broad  indemnification  to commercial
nuclear power plant operators and DOE contractors for liabilities arising out of
nuclear  incidents  at  power  plants  licensed  by the NRC  and at DOE  nuclear
facilities.  That indemnification protects not only the NRC license or DOE prime
contractor,  but also  others  like us who may be doing work under  contract  or
subcontract for a licensed power plant or under a DOE prime contract.  While the
Price-Anderson  Act's  indemnification  provisions  are  broad,  it has not been
determined  whether  they apply to all  liabilities  that might be incurred by a
radioactive  materials cleanup  contractor.  Moreover,  the  Price-Anderson  Act
indemnification  authority expired on December 31, 2003, for NRC licensees,  and
it will expire on December 31, 2004 for DOE  contractors.  There are legislative
proposals  to enact a  long-term  extension  of Price  Anderson  indemnification
authority,  as has been done several times in the past. Those proposals are part
of the omnibus energy  legislation  that is pending in Congress.  However,  that
bill has been held up during the last several  legislative  sessions for reasons
unrelated to Price  Anderson.  DOE  contractors  who have coverage under current
contracts  would be unaffected by the  expiration of authority at the end of the
year.   Their   coverage   continues   until  the   contract   under  which  the
indemnification was granted terminates.  However,  our federal business could be
adversely  affected if DOE prime  contractors  are  reluctant  to enter into new
contracts  involving  nuclear  hazards in the absence of an  extension  of Price
Anderson  indemnification  authority for them after  December 31, 2004.  DOE has
alternative,  although more limited,  indemnification authority under Public Law
85-804,  and when Price Anderson has  temporarily  lapsed in the past, DOE prime
contractors were generally  willing to accept that coverage on an interim basis.
Private  insurers,  however,  have  generally  not been willing to cover nuclear
hazards associated with DOE work.

WE WILL NOT REALIZE A BENEFIT  FROM OUR LOSS  CARRYFORWARDS  IF WE ARE UNABLE TO
GENERATE INCOME.

      We have  approximately  $23.1 million in net operating loss  carryforwards
which will expire from 2007 to 2023 if not used against  future  federal  income
tax liabilities.  Our net loss carryforwards are subject to various  limitations
and have not been audited by the Internal Revenue Service. We anticipate the net
loss  carryforwards will be used to reduce the federal income tax payments which
we would otherwise be required to make with respect to income, if any, generated
in future years.


                                       8
<PAGE>


DELAWARE LAW, CERTAIN OF OUR CHARTER PROVISIONS, THE PRESENCE OF ONE SUBSTANTIAL
STOCKHOLDER  OF  RECORD,  AND OUR STOCK  OPTION  PLANS  MAY  INHIBIT A CHANGE OF
CONTROL  UNDER  CIRCUMSTANCES  THAT COULD GIVE YOU AN  OPPORTUNITY  TO REALIZE A
PREMIUM OVER PREVAILING MARKET PRICES.

      We are a Delaware  corporation  governed,  in part,  by the  provisions of
Section 203 of the General Corporation Law of Delaware, an anti-takeover law. In
general,  Section 203 prohibits a Delaware public corporation from engaging in a
"business  combination"  with an "interested  stockholder" for a period of three
years after the date of the transaction in which the person became an interested
stockholder,  unless the  business  contribution  is  approved  in a  prescribed
manner. As a result of Section 203, potential  acquirers may be discouraged from
attempting  to  effect  acquisition   transactions  with  us,  thereby  possibly
depriving our security  holders of certain  opportunities  to sell, or otherwise
dispose  of,  their  stock  in  us  at  above-market  prices  pursuant  to  such
transactions.

      Our 1991  Performance  Equity Plan,  1992 Outside  Directors  Stock Option
Plan, 1993 Nonqualified Stock Option Plan, and 2003 Outside Directors Stock Plan
provide for the immediate  acceleration  of, and removal of  restrictions  from,
options and other awards under such plans upon a "change of control" (as defined
in  the  respective  plans).  Such  provisions  may  also  have  the  result  of
discouraging acquisition of us.

      Capital Bank, as agent for its investors, is the record owner of shares of
common stock,  the issued and  outstanding  shares of Series 17  Preferred,  and
outstanding  warrants for the purchase of shares of common stock.  The existence
of one  substantial  stockholder of record could  discourage  other persons from
attempting to acquire us.

      Under  our  Restated   Certificate  of  Incorporation,   as  amended  (the
"Certificate"),  as of  April  22,  2004,  33,572,275  shares  of  common  stock
(including 988,000 treasury shares) are available for future issuance,  of which
17,787,110  are reserved for issuance  under our  outstanding  preferred  stock,
options and warrants.  These authorized  shares are necessary to provide us with
the  ability  to issue  common  stock  from  time to time as needed  for  proper
corporate purposes, such as:

      o     raising capital funds through private or public offerings;

      o     acquiring other companies;

      o     declaring stock splits or stock dividends; and

      o     issuing  common  stock under  warrants,  preferred  stock,  or other
            rights which may be granted by us from time to time in the future.

      Additional  authorization  of  shares  of  common  stock  could be used by
incumbent  management  to make it more  difficult,  and  thereby  discourage  an
attempt to acquire control of us, even though our  stockholders may deem such an
acquisition  desirable.  The  issuance  of new  shares  of common  stock  and/or
preferred  stock  could  also be used to dilute the stock  ownership  and voting
power of a third  party  seeking  to remove  the  directors,  replace  incumbent
directors,  accomplish  certain business  combinations  alter,  amend, or repeal
portions of our Certificate or discourage or prohibit a takeover of us.

TERRORIST ATTACKS, SUCH AS THE ATTACKS THAT OCCURRED IN NEW YORK AND WASHINGTON,
D.C. ON SEPTEMBER  11, 2001,  AND OTHER ACTS OF VIOLENCE OR WAR,  INCLUDING  THE
MILITARY  CONFLICT IN IRAQ, HAVE AND COULD  NEGATIVELY  IMPACT US AND OTHER U.S.
AND FOREIGN COMPANIES,  THE FINANCIAL MARKETS,  THE INDUSTRIES WHERE WE OPERATE,
OUR OPERATIONS AND PROFITABILITY.

      The  terrorist  attacks  that  occurred on September  11, 2001  negatively
effected our operations and your investment,  as the DOE and other  governmental
agencies  that generate  radioactive  waste  suspended  shipments of these waste
streams to various  off-site TSD radioactive  waste facilities for a substantial
period of time after September 11, 2001 and did not begin to ship waste to these
off-site TSD facilities such as ours until the third quarter of 2003.  There can
be no  assurance  that there will not be further  terrorist  attacks  worldwide.
These attacks have contributed to economic  instability in the United States and
elsewhere,  and future acts of terrorism,  violence or war could further  affect
the  industries  where we  operate,  our  business,  results of  operations  and
financial  condition.  The consequences of any terrorist  attacks or hostilities
are  unpredictable,  and we may not be able to foresee events that could have an
adverse effect on our operations or your investment.


                                       9
<PAGE>


               SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

      This prospectus contains forward-looking statements. All statements, other
than  statements of  historical  fact, in this  prospectus  are  forward-looking
statements, including statements regarding, among other things:

      o     the adequacy of our insurance;

      o     our ability to continue to borrow under the Credit Facility;

      o     our ability to manage our growth;

      o     potential for litigation against us;

      o     our ability to be profitable on a long term basis;

      o     our ability to protect our proprietary technologies;

      o     our  ability to utilize net  operating  loss  carryforwards  against
            future federal income tax liabilities;

      o     our ability to comply with our general working capital requirements;

      o     our ability to retain certain permits or licenses;

      o     the  adoption  of  moratoriums  or  limitations  by federal or state
            governments   regarding   the  creation  of  new   hazardous   waste
            regulations.

      Although we believe our  expectations  reflected in those  forward-looking
statements are based on reasonable assumptions,  we cannot assure you that these
expectations  will prove to be  correct.  Important  factors  which  could cause
actual results and future outcomes to differ  materially from those described in
this prospectus include, but are not limited to, the following:

      o     general economic conditions;

      o     material reduction in revenues;

      o     inability  to  collect  in a timely  manner  a  material  amount  of
            receivables;

      o     increased competitive pressures;

      o     inability to maintain and obtain  required  permits and approvals to
            conduct operations;

      o     reduction in revenues and  profitability of services  provided by us
            due to increased competition;

      o     future  federal  tax audit or audits  which  could  reduce  our loss
            carryforwards;

      o     limitations imposed by the Internal Revenue Code or our inability to
            utilize our loss carryforwards;

      o     inability to develop new and existing technologies in the conduct of
            operations or to develop such technologies for commercial use;

      o     changes  in  federal,   state,   and  local  laws  and  regulations,
            especially  environmental  regulations,  or in the interpretation of
            such laws and regulations;

      o     potential  increases in equipment,  maintenance,  operating or labor
            costs;

      o     management retention and development;

      o     inability to secure  additional  liquidity in the form of additional
            equity or debt;

      o     inability to maintain the listing of our common stock on the Nasdaq;

      o     cancellation of one or more DOE subcontracts;  and o the factors set
            forth under "Risk Factors" beginning on page 2 of this prospectus.

      In some cases, you can identify forward-looking  statements by terminology
such  as  "may,"  "will,"   "should,"   "could,"   "would,"   "expect,"  "plan,"
"anticipate,"  "believe,"  "continue," or the derivative of these terms or other
similar  expressions.  All  forward-looking  statements  attributable  to  us or
persons  acting  on  our  behalf  are  expressly  qualified  by  the  cautionary
statements included in this prospectus.  We undertake no obligation to update or
revise our forward-looking  statements,  whether as a result of new information,
future  events  or  otherwise.  In  light  of  these  risks,  uncertainties  and
assumptions,  the forward-looking  events discussed in this prospectus might not
occur.

                               RECENT DEVELOPMENTS

      The following are all material  changes to our affairs which have occurred
since the end of our latest fiscal year for which audited  financial  statements
were included in our Form 10-K for year ended  December 31, 2003, and which have
not been described in a report on Form 8-K filed under the Exchange Act:


                                       10
<PAGE>


PRIVATE PLACEMENT

      Pursuant to a Securities  Purchase  Agreement,  dated March 22,  2004,  we
completed a private  placement of our common stock and warrants for the purchase
of our common stock, and received gross proceeds of approximately  $10.4 million
in connection with this offering.  We sold to 15 accredited  investors 4,616,113
shares of common stock at $2.25 per share and warrants for the purchase of up to
an additional  1,615,638  shares of common stock.  The warrants have an exercise
price of $2.92 per share and a three year term.  The  warrants  may be exercised
pursuant to a cashless  exercise  option if, at any time after one year from the
date of issuance of the warrants,  there is no effective  registration statement
registering  the resale of the shares issuable upon exercise of the warrants and
such  shares  are  not  eligible  to be sold  pursuant  to  Rule  144(k)  of the
Securities Act.

      We realized net proceeds from the private placement of approximately  $9.9
million,  after  paying  fees of  $515,000  to the  placement  agent and certain
expenses of the placement agent. The net proceeds were used as follows:

      o     $2.9  million in  connection  with a certain  acquisition  discussed
            below; and

      o     the  remaining  $7.0  million to reduce debt,  make certain  capital
            expenditures and for working capital purposes.

      As  compensation  for consulting  services in connection  with the private
placement,  we issued warrants ("Consultant Warrants") to outside consultants to
purchase  an  aggregate  of  160,000  shares of our  common  stock,  subject  to
adjustment.  The  Consultant  Warrants have an exercise price of $2.92 per share
and a three year term.

      The exercise  price of, and number of shares of common stock issuable upon
exercise of, the warrants and Consulting Warrants are each subject to adjustment
upon  certain  events.  These events  include,  among  others,  stock splits and
reclassifications of our common stock, and certain reorganizations,  mergers and
consolidations.

      The issuance of shares,  warrants and Consultant  Warrants described above
was made pursuant to a private  placement under Section 4(2) and/or Regulation D
of the Securities  Act. The shares issued in the private  placement and issuable
upon exercise of the warrants  issued in the private  placement  (excluding  the
shares  issuable  under the  Consultant  Warrants)  are  subject  to demand  and
piggyback registration rights. All of the shares listed above are registered for
resale in the registration statement, of which this prospectus is a part.

ACQUISITIONS

      In March 2004,  we  completed  the  acquisition  of certain  assets of two
companies  owned by US Liquids,  Inc. We  acquired  assets of USL  Environmental
Services, Inc., d/b/a A&A Environmental ("A&A"), primarily located in Baltimore,
Maryland.  We also acquired  certain assets of US Liquids of Pennsylvania  d/b/a
EMAX ("EMAX"), located in Pittsburgh, Pennsylvania. We paid $2.9 million in cash
for  these  assets.  A&A and EMAX had  unaudited  combined  revenues  in 2003 of
approximately   $15  million  and  had  an   unaudited   combined  net  loss  of
approximately $299,000.

      A&A is a full  line  provider  of  environmental,  marine  and  industrial
maintenance  services.  A&A has been in business for over 45 years and continues
to adapt to meet  the  specialized  needs of  today's  environmental  and  plant
managers.  A&A offers expert  environmental  services such as 24 hour  emergency
response,  vacuum services,  hazardous and non-hazardous waste disposal,  marine
environmental  and  other  remediation  services.  EMAX,  through  its field and
industrial services group, provides a variety of environmental  services such as
transportation of drums and bulk loads, tank cleaning,  industrial  maintenance,
dewatering,  drum management and chemical packaging.  EMAX also has a wastewater
treatment group,  which provides for the treatment of non-hazardous  wastewaters
such as leachates, oily waters, industrial process waters and off-spec products.
We currently intend to continue  operating the assets acquired from A&A and EMAX
substantially as they were operated prior to acquisition.


                                       11
<PAGE>


                                 USE OF PROCEEDS

      We will not  receive any  proceeds  from the sale of shares by the Selling
Stockholders.   We  will  receive   approximately   $5,184,863  if  the  Selling
Stockholders  exercise,  for cash, all of the warrants and  Consultant  Warrants
covering the shares included in this prospectus.  We currently intend to use any
proceeds  received  by us from  the  exercise  of the  warrants  and  Consultant
Warrants to reduce debt and/or general working capital.

      We have agreed to pay all costs and fees relating to the  registration  of
the  common  stock  covered  by  this  prospectus,  except  for  any  discounts,
concessions, or commissions payable to underwriters, dealers, or agents incident
to the  offering  of the shares  covered by this  prospectus,  or any legal fees
incurred by any Selling Stockholders relating to this offering.

                              SELLING STOCKHOLDERS

      The  shares of common  stock  being  offered by the  Selling  Stockholders
consist of (a)  4,616,113  shares  issued in the private  placement  effected in
March 2004,  (b)  1,615,638  shares  issuable  upon the exercise of the warrants
issued in the  private  placement,  and (c)  160,000  shares  issuable  upon the
exercise  of the  Consultant  Warrants  issued in  connection  with the  private
placement. These shares of common stock are described under "RECENT DEVELOPMENTS
- Private  Placement." We are registering the shares of common stock in order to
permit the  Selling  Stockholders  to offer the  shares for resale  from time to
time.  Except for the  ownership of the shares of common stock and the warrants,
the Selling  Stockholders have not had any material  relationship with us within
the past three  years other than (a) R. Keith  Fetter,  Joe  Dilustro,  and Chet
Dubov,  who  provided   consulting  services  in  connection  with  the  private
placement, and (b) Andy Reckless, who, in his capacity as managing member of PEF
Advisors,   LLC,  the  investment   advisor  for  Palisades  Master  Fund,  L.P.
("Palisades"),  has voting and dispositive power over the shares owned of record
by Palisades, is chairman of HPC Capital Management Corporation,  which acted as
our placement agent in the Private Placement.

      The  following  table sets forth as to each Selling  Stockholder:  (a) the
name of each Selling Stockholder, (b) the amount of shares beneficially owned as
of April 12,  2004,  (c) the  number of  shares  of common  stock  owned by each
Selling Stockholder which are included under this prospectus,  (d) the number of
shares beneficially owned after the offering, assuming that all shares of common
stock being offered hereby are sold and that such are  outstanding,  and (e) the
percentage of common stock  beneficially owned after completion of the offering.
Unless otherwise noted, each Selling  Stockholder has sole voting and investment
power  over the  shares of common  stock  listed  as  beneficially  owned by the
Selling Stockholder.

      The common stock being offered includes shares of common stock that may be
acquired upon the exercise of outstanding  warrants,  whether such are currently
exercisable. The Selling Stockholders may sell all, some or none of their shares
in this offering. See "PLAN OF DISTRIBUTION."

      The percentage of common stock beneficially owned after completion of this
offering assumes:  (a) all shares of common stock covered by this prospectus are
sold,  (b) the Selling  Stockholder  does not acquire  beneficial  ownership  of
additional shares of common stock after the date of this prospectus,  and (c) we
do not  issue any  additional  shares  of  common  stock  after the date of this
prospectus,  except the shares of common  stock  which a person has the right to
acquire  upon the  exercise  of  warrants  and  conversion  of  preferred  stock
outstanding  as of the  date  of  this  prospectus,  but  such  shares  are  not
determined  to be  outstanding  for the  purpose  of  computing  the  percentage
ownership  of  any  other  person.  The  percentages   indicated  are  based  on
outstanding common stock of 41,427,725 shares as of April 12, 2004.

      This  prospectus  covers the resale of the shares of common stock issuable
upon exercise of the warrants issued in the private  placement and the shares of
common stock issuable upon exercise of the Consultant Warrants, determined as if
the  warrants  and  Consultant  Warrants  were  exercised  in full.  Because the
exercise  price of the warrants  and  Consultant  Warrants may be adjusted,  the
number  of  shares  that will  actually  be issued  may be more or less than the
number of shares being offered by this prospectus.

      Under the terms of the warrants,  a selling  stockholder  may not exercise
the warrants,  to the extent such exercise would cause such selling stockholder,
together with its affiliates,  to beneficially  own a number of shares of common
stock which would  exceed 4.99% of our then  outstanding  shares of common stock
following such exercise,  excluding for purposes of such determination shares of
common  stock  issuable  upon  exercise  of the  warrants  which  have  not been
exercised. The table below does not reflect this limitation.

      None of the Selling  Stockholders  are  broker-dealers  or  affiliates  of
broker-dealers.  Based on the  information  provided  to us, each of the Selling
Stockholders purchased the shares and the warrants, and upon the exercise of the
warrants,  will  purchase  the shares  underlying  the  warrants in the ordinary
course of business and did not at the time of their purchase have an arrangement
to effect any  distribution  of the shares,  warrants and shares  underlying the
warrants to or through any person or entity


                                       12
<PAGE>

<TABLE>
<CAPTION>
                                               SHARES OWNED            SHARES BEING            SHARES OWNED
                                              BEFORE OFFERING             OFFERED             AFTER OFFERING
                                       ----------------------------- ------------------  --------------------------
SELLING STOCKHOLDER                        NUMBER           PERCENT       NUMBER            NUMBER         PERCENT
                                       ----------------    --------- ------------------  --------------  ----------
<S>                                      <C>               <C>          <C>               <C>            <C>
Alexandra Global Master Fund Ltd             1,012,500 (1)     2.4%          1,012,500        --            --
Alpha Capital AG                               210,000 (2)        *            210,000        --            --
Baystar Capital II, L.P.                       243,000 (3)        *            243,000        --            --
Bristol Investment Fund, Ltd.                  240,000 (4)        *            240,000        --            --
Crescent International Ltd                     405,000 (5)        *            405,000        --            --
Crestview Capital Master LLC                   900,002 (6)     2.2%            900,002        --            --
Geduld Capital Partners LP                     101,250 (7)        *            101,250        --            --
Gruber & McBaine International                 150,000 (8)        *            150,000        --            --
Irwin Geduld Revocable Trust                    67,500 (9)        *             67,500        --            --
J Patterson McBaine                             59,999 (10)       *             59,999        --            --
Jon D. Gruber and Linda W. Gruber              150,000 (11)       *            150,000        --            --
Lagunitas Partners LP                          360,000 (12)       *            360,000        --            --
Omicron Master Trust                           300,000 (13)       *            300,000        --            --
Palisades Master Fund, L.P.                  1,822,500 (14)    4.3%          1,822,500        --            --
Stonestreet LP                                 210,000 (15)       *            210,000        --            --
R. Keith Fetter                                100,000 (16)       *            100,000        --            --
Joe Dilustro                                    30,260 (17)       *             30,000        260            *
Chet Dubov                                      30,000 (18)       *             30,000        --            --
</TABLE>


      *     Less than 1%

      (1)   Includes  750,000  shares,  and  262,500  shares  issuable  upon the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            Alexandra Investment  Management,  LLC, a Delaware limited liability
            company  ("Alexandra"),  serves as  investment  adviser to Alexandra
            Global Master Fund Ltd., a British Virgin Islands  company  ("Master
            Fund"). By reason of such  relationship,  Alexandra may be deemed to
            share  dispositive  power over the shares of common  stock stated as
            benefically  owned by Master Fund.  Alexandra  disclaims  beneficial
            ownership  of such  shares of  commons  stock.  Messrs.  Mikhail  A.
            Filimonov   ("Filimonov")  and  Dimitri  Sogoloff  ("Sogoloff")  are
            managing  members  of  Alexandra.  By reason of such  relationships,
            Filimonov  and  Sogoloff may be deemed to  share  dispositive  power
            over the  shares of common  stock  stated as  beneficially  owned by
            Master Fund. Filimonov and Sogoloff disclaim beneficial ownership of
            such shares of common stock.

      (2)   Includes  155,556  shares,  and  54,444  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."

      (3)   Includes  180,000  shares,  and  63,000  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            Steve Derby,  Lawrence  Goldfarb,  and Steven M. Lamar,  as managing
            members of Baystar Capital  Management,  LLC, the general partner of
            Baystar  Capital II, L.P.,  share voting and  investment  power over
            these shares and disclaim beneficial ownership of these shares.

      (4)   Includes  177,778  shares,  and  62,222  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            Paul  Kessler,  as director  and managing  member of the  investment
            manager to Bristol  Investment Fund, Ltd., has voting and investment
            power over these shares.

      (5)   Includes  300,000  shares,  and  105,000  shares  issuable  upon the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            Mel  Craw  and  Maxi  Brezzi,  in  their  capacity  as  managers  of
            GreenLight  (Switzerland)  SA, the  investment  advisor to  Crescent
            International  Ltd.,  have voting control and investment  discretion
            over the shares owned by Crescent  International  Ltd. Messrs.  Craw
            and Brezzi disclaim beneficial ownership of such shares.

      (6)   Includes  666,668  shares,  and  233,334  shares  issuable  upon the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."

      (7)   Includes 75,000 shares, and 26,250 shares issuable upon the exercise
            of  warrants,  issued  in  connection  with  the  private  placement
            discussed under "Recent  Developments - Private  Placement."  Steven
            Geduld, in his capacity as president of Geduld Capital Partners, LP,
            has voting and investment power over these shares.

      (8)   Includes  111,111  shares,  and  38,889  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            Gruber & McBaine  Capital  Management is the  investment  advisor of
            Gruber & McBaine  International and the general partner of Lagunitas
            Partners,  L.P. and  consequently  has voting control and investment
            discretion   over  the   securities   held  by   Gruber  &   McBaine
            International  and  Lagunitas  Partners,  L.P.  Gruber & McBaine Cap
            Management  is managed by Jon D.  Gruber and J.  Patterson  McBaine.
            Lagunitas  Partners,  L.P., Gruber & McBaine  International,  Jon D.
            Gruber and J. Patterson  McBaine  disclaim  beneficial  ownership of
            shares held by each other.


                                       13
<PAGE>

      (9)   Includes 50,000 shares, and 17,500 shares issuable upon the exercise
            of  warrants,  issued  in  connection  with  the  private  placement
            discussed  under "Recent  Developments - Private  Placement."  Irwin
            Geduld,  as  trustee,  has voting and  dispositive  power over these
            shares.

      (10)  Includes 44,444 shares, and 15,555 shares issuable upon the exercise
            of  warrants,  issued  in  connection  with  the  private  placement
            discussed  under  "Recent  Developments  - Private  Placement."  See
            footnote (8) for a discussion of certain relationships.

      (11)  Includes  111,111  shares,  and  38,889  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            See footnote (8) for a discussion of certain relationships.

      (12)  Includes  266,667  shares,  and  93,333  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            See footnote (8) for a discussion of certain relationships.

      (13)  Includes  222,222  shares,  and  77,778  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."

      (14)  Includes  1,350,000  shares,  and 472,500  shares  issuable upon the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            Andy Reckless is the managing  member of PEF Advisors,  LLC ("PEF"),
            the investment  manager to Palisades  Masterfund,  L.P. By reason of
            such  relationship,  Mr.  Reckless  may be deemed to have voting and
            investment power over these shares.

      (15)  Includes  155,556  shares,  and  54,444  shares  issuable  upon  the
            exercise  of  warrants,   issued  in  connection  with  the  private
            placement discussed under "Recent Developments - Private Placement."
            Michael  Finkelstein  and Elizabeth  Leonard,  in their  capacity as
            officers of Stonestreet  LP share voting and  investment  power over
            these shares.

      (16)  Includes  100,000  shares  issuable  upon the exercise of Consultant
            Warrants discussed under "Recent Developments - Private Placement."

      (17)  Includes  30,000  shares  issuable  upon the exercise of  Consultant
            Warrants discussed under "Recent  Developments - Private Placement,"
            and 260 shares  beneficially  owned by Mr.  Dilustro's  spouse.  Mr.
            Dilustro may be considered to share  beneficial  ownership  with his
            spouse over the shares beneficially owned by her.

      (18)  Includes  30,000 shares issuable upon the exercise of the Consultant
            Warrants discussed under "Recent Developments - Private Placement."


                                       14
<PAGE>


                              PLAN OF DISTRIBUTION

      The Selling  Stockholders  of our common stock and any of their  pledgees,
assignees and successors-in-interest  may, from time to time, sell any or all of
their shares of common stock on any stock exchange,  market or trading  facility
on which the shares are traded or in private transactions. These sales may be at
fixed or negotiated prices. The Selling  Stockholders may use any one or more of
the following methods when selling shares:

      o     ordinary  brokerage  transactions  and  transactions  in  which  the
            broker-dealer solicits purchasers;

      o     block  trades in which the  broker-dealer  will  attempt to sell the
            shares as agent but may  position  and resell a portion of the block
            as principal to facilitate the transaction;

      o     purchases  by  a  broker-dealer  as  principal  and  resale  by  the
            broker-dealer for its account;

      o     an  exchange  distribution  in  accordance  with  the  rules  of the
            applicable exchange;

      o     privately negotiated transactions;

      o     settlement of short sales;

      o     broker-dealers  may agree with the  Selling  Stockholders  to sell a
            specified number of such shares at a stipulated price per share;

      o     a combination of any such methods of sale;

      o     through  the  writing or  settlement  of  options  or other  hedging
            transactions, whether through an options exchange or otherwise; or

      o     any other method permitted pursuant to applicable law.

      The Selling  Stockholders  may also sell  shares  under Rule 144 under the
Securities Act, if available, rather than under this prospectus.

      Broker-dealers  engaged by the Selling  Stockholders may arrange for other
brokers-dealers to participate in sales.  Broker-dealers may receive commissions
or discounts from the Selling  Stockholders  (or, if any  broker-dealer  acts as
agent  for the  purchaser  of  shares,  from the  purchaser)  in  amounts  to be
negotiated.  Each  Selling  Stockholder  does not expect these  commissions  and
discounts  relating to its sales of shares to exceed what are  customary  in the
types of transactions involved.

      In connection with the sale of our common stock or interests therein,  the
Selling  Stockholders may enter into hedging transactions with broker-dealers or
other  financial  institutions,  which may in turn  engage in short sales of the
common stock in the course of hedging the  positions  they  assume.  The Selling
Stockholders  may also sell shares of our common  stock short and deliver  these
securities  to close out their  short  positions,  or loan or pledge  the common
stock to  broker-dealers  that in turn may sell these  securities.  The  Selling
Stockholders   may  also  enter   into   option  or  other   transactions   with
broker-dealers  or other  financial  institutions or the creation of one or more
derivative  securities which require the delivery to such broker-dealer or other
financial  institution of shares offered by this  prospectus,  which shares such
broker-dealer  or  other  financial  institution  may  resell  pursuant  to this
prospectus (as supplemented or amended to reflect such transaction).

      The  Selling  Stockholders  and any  broker-dealers  or  agents  that  are
involved  in selling  the shares may be deemed to be  "underwriters"  within the
meaning of the Securities Act in connection with such sales. In such event,  any
commissions  received  by such  broker-dealers  or agents  and any profit on the
resale  of the  shares  purchased  by  them  may be  deemed  to be  underwriting
commissions or discounts under the Securities Act. Each Selling  Stockholder has
informed  the  Company  that it does not have any  agreement  or  understanding,
directly or indirectly, with any person to distribute the Common Stock.

      We are required to pay certain  fees and expenses  incurred by us incident
to  the  registration  of  the  shares.  We  agreed  to  indemnify  the  Selling
Stockholders against certain losses, claims, damages and liabilities,  including
liabilities under the Securities Act.

      Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities  Act, they will be subject to the prospectus  delivery
requirements of the Securities Act. In addition,  any securities covered by this
prospectus  which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather  than  under  this  prospectus.  Each  Selling
Stockholder  has  advised  us that they have not  entered  into any  agreements,
understandings or arrangements  with any underwriter or broker-dealer  regarding
the sale of the resale shares.  There is no underwriter or  coordinating  broker
acting in connection  with the proposed sale of the resale shares by the Selling
Stockholders.


                                       15
<PAGE>

      We agreed to keep this  prospectus  effective until the earlier of (i) the
date on which  the  shares  may be resold by the  Selling  Stockholders  without
registration  and  without  regard to any volume  limitations  by reason of Rule
144(k) under the  Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold  pursuant to the  prospectus  or Rule 144 under the
Securities  Act or any other rule of similar  effect.  The resale shares will be
sold only through  registered or licensed  brokers or dealers if required  under
applicable  state securities  laws. In addition,  in certain states,  the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable  state or an exemption  from the  registration  or  qualification
requirement is available and is complied with.

      Under applicable rules and regulations  under the Exchange Act, any person
engaged in the distribution of the resale shares may not  simultaneously  engage
in market making activities with respect to our common stock for a period of two
business days prior to the commencement of the  distribution.  In addition,  the
Selling  Stockholders  will be subject to applicable  provisions of the Exchange
Act and the rules and regulations thereunder,  including Regulation M, which may
limit the timing of  purchases  and sales of shares of our  common  stock by the
Selling Stockholders or any other person. We will make copies of this prospectus
available  to the Selling  Stockholders  and have  informed  them of the need to
deliver a copy of this  prospectus to each  purchaser at or prior to the time of
the sale.

                                  LEGAL OPINION

      Conner &  Winters,  P.C.,  Oklahoma  City,  Oklahoma  will opine as to the
validity of the shares of common stock being offered hereby.

                                     EXPERTS

Our  financial  statements  and  schedule  incorporated  by  reference  in  this
prospectus have been audited by BDO Seidman,  LLP, independent  certified public
accountants,  to the  extent  and for the  periods  set  forth in  their  report
incorporated  herein by reference,  and are incorporated herein in reliance upon
such report  given upon the  authority  of said firm as experts in auditing  and
accounting.

      Approximately  85% and 87% of the  total  hours  spent on the audit of our
financial   statements   for  the  years  ended  December  31,  2003  and  2002,
respectively,  were spent by  Gallogly,  Fernandez & Riley,  LLP  ("GFR"),  as a
member of the BDO alliance network of firms. Members of the BDO alliance network
of firms, including GFR, are not full time, permanent employees of BDO.

                       WHERE YOU CAN FIND MORE INFORMATION

We file  annual,  quarterly  and special  reports,  proxy  statements  and other
information  with the SEC.  You may  read and copy any  document  we file at the
SEC's Public Reference Room at 450 Fifth Street, N.W., Washington,  D.C., 20549.
Please  call the SEC at  1-800-SEC-0330  for further  information  on the Public
Reference  Room.  Our SEC filings are also  available to the public on the SEC's
web site at http://www.sec.gov.

The SEC allows us to "incorporate by reference" the information we file with it.
This allows us to disclose  important  information  to you by  referring  you to
those documents  instead of having to repeat the information in this prospectus.
The  information  incorporated  by  reference is  considered  to be part of this
prospectus,  and later information that we file with the SEC will  automatically
update and supersede this information. We incorporate by reference the documents
listed  below and any future  filings  made with the SEC under  Sections  13(a),
13(c), 14, or 15(d) of the Exchange Act until the Selling  Stockholders sell all
the Shares:

      o     Our annual  report on Form 10-K for the fiscal  year ended  December
            31, 2003;

      o     Our current report on Form 8-K filed on March 2, 2004;

      o     Our current report on Form 8-K filed on March 23, 2004;

      o     Our current report on Form 8-K/A filed on April 2, 2004;

      o     Our current report on Form 8-K filed on April 8, 2004;

      o     Our current report on Form 8-K filed on April 30, 2004; and

      o     Description  of our  common  stock  contained  in  our  Registration
            Statement on Form 8-A, dated October 30, 1992.


                                       16
<PAGE>

      You can  request  a copy of these  filings,  at no  cost,  by  writing  or
telephoning us at the following address and telephone number:

                     Perma-Fix Environmental Services, Inc.
                          Attention: Richard T. Kelecy
                            1940 Northwest 67th Place
                           Gainesville, Florida 32653
                            Telephone (352) 373-4200

      You should rely only on the  information  contained in this  prospectus or
any  supplement  and in the documents  incorporated  by  reference.  We have not
authorized  anyone else to provide you with different  information.  The Selling
Stockholders will not make an offer of these Shares in any state where the offer
is not permitted.

      This prospectus is part of a registration  statement we filed with the SEC
(Registration  No. 333- ). That  registration  statement and the exhibits  filed
along with the registration  statement contain more information about the shares
sold by the Selling  Stockholders.  Because information about contracts referred
to in  this  prospectus  is not  always  complete,  you  should  read  the  full
contracts,  which are filed as exhibits to the registration  statement.  You may
read and copy the full  registration  statement  and its  exhibits  at the SEC's
public reference rooms or their website.


                                       17
<PAGE>

                     [PERMAFIX ENVIRONMENTAL SERVICES LOGO]



                                6,391,751 SHARES

                     PERMA-FIX ENVIRONMENTAL SERVICES, INC.

                                  COMMON STOCK




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

                                   PROSPECTUS

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





                                __________, 2004


<PAGE>

                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14.  Other Expenses of Issuance and Distribution

Nature of Expenses

        SEC Registration Fee                                $          1,685
        Legal Fees (Including Blue Sky)                     $         25,000
        Accounting Fees and Expenses                        $          6,500
        Printing                                            $            500
        Miscellaneous                                       $              0
                                                            ----------------

              Total:                                        $         33,685
                                                            ----------------


The foregoing expenses,  except for the registration fee, are estimated pursuant
to Item 511 of Regulation S-K.

Item 15. Indemnification of Officers and Directors

      Section 145 of the Delaware  Corporation  Law provides  that a corporation
has the  power  to  indemnify  a  director,  officer,  employee  or agent of the
corporation  and certain other persons serving at the request of the corporation
in related  capacities  against amounts paid and expenses incurred in connection
with an action or  proceeding to which he is or is threatened to be made a party
by reason of such position, if such person shall have acted in good faith and in
a manner he reasonably believed to be in or not opposed to the best interests of
the  corporation,  and,  in any  criminal  proceeding,  if  such  person  had no
reasonable  cause to  believe  his  conduct  was  unlawful;  provided  that,  no
indemnification shall be made with respect to any matter as to which such person
shall have been adjudged to be liable to the corporation  unless and only to the
extent that the adjudicating  court determines that, despite the adjudication of
liability but in view of all the circumstance of the case, such person is fairly
and reasonably entitled to indemnification.

      Article EIGHTH of our Restated  Certificate of Incorporation,  as amended,
provides as follows  with  respect to the  indemnification  of our  officers and
directors:

            All persons who the  Corporation is empowered to indemnify  pursuant
            to the provisions of Section 145 of the General  Corporation  Law of
            the State of Delaware  (or any similar  provision or  provisions  of
            applicable  law at the time in effect),  shall be indemnified by the
            Corporation  to the full extent  permitted  thereby.  The  foregoing
            right of indemnification  shall not be deemed to be exclusive of any
            other rights to which those seeking  indemnification may be entitled
            under any bylaw,  agreement,  vote of stockholders or  disinterested
            directors,  or  otherwise.  No repeal or  amendment  of this Article
            EIGHTH shall  adversely  affect any rights of any person pursuant to
            this  Article  EIGHTH  which  existed at the time of such  repeal or
            amendment with respect to acts or omissions  occurring prior to such
            repeal or amendment.

      Our Restated  Certificate of Incorporation,  as amended,  provides that no
director shall be personally  liable to us or its  stockholders for any monetary
damages  for  breaches  of  fiduciary  duty as a  director,  provided  that this
provision  shall not  eliminate or limit the liability of a director (i) for any
breach of the  director's  duty of loyalty to us or our  stockholders;  (ii) for
acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; (iii) under Section 174 of the General Corporation Law
of the State of Delaware;  or (iv) for any  transaction  from which the director
derived an improper personal benefit.


                                      II-1
<PAGE>

Item 16. Exhibits


EXHIBIT NO.                             DESCRIPTION
--------------------------------------------------------------------------------

         4.1      Securities  Purchase  Agreement dated March 16, 2004,  between
                  the Company and  Alexandra  Global  Master Fund,  Ltd.,  Alpha
                  Capital AG, Baystar Capital II, L.P., Bristol Investment Fund,
                  Ltd.,  Crescent  International  Ltd,  Crestview Capital Master
                  LLC,   Geduld   Capital   Partners   LP,   Gruber  &   McBaine
                  International,  Irwin  Geduld  Revocable  Trust,  J  Patterson
                  McBaine, Jon D. Gruber and Linda W. Gruber, Lagunitas Partners
                  LP,  Omicron  Master  Trust,   Palisades  Master  Fund,  L.P.,
                  Stonestreet LP. The Company will furnish supplementally a copy
                  of all omitted schedules to the Commission upon request.

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

         4.2      Registration  Rights Agreement,  dated March 16, 2004, between
                  the Company and  Alexandra  Global  Master Fund,  Ltd.,  Alpha
                  Capital AG, Baystar Capital II, L.P., Bristol Investment Fund,
                  Ltd.,  Crescent  International  Ltd,  Crestview Capital Master
                  LLC,   Geduld   Capital   Partners   LP,   Gruber  &   McBaine
                  International,  Irwin  Geduld  Revocable  Trust,  J  Patterson
                  McBaine, Jon D. Gruber and Linda W. Gruber, Lagunitas Partners
                  LP,  Omicron  Master  Trust,   Palisades  Master  Fund,  L.P.,
                  Stonestreet LP.

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

       4.3         Common Stock Purchase  Warrant,  dated March 16, 2004, issued
                   by the company to Alexandra Global Master Fund, Ltd., for the
                   purchase of 262,500  shares of the  Company's  common  stock.
                   Substantially  similar warrants were issued by the Company to
                   the  following:  (1) Alpha Capital AG, for the purchase of up
                   to  54,444  shares;  (2)Baystar  Capital  II,  L.P.,  for the
                   purchase of up to 63,000 shares; (3) Bristol Investment Fund,
                   Ltd., for the purchase of up to 62,222  shares;  (4) Crescent
                   International  Ltd, for the purchase of up to 105,000 shares;
                   (5) Crestview  Capital  Master LLC, for the purchase of up to
                   233,334  shares;  (6)  Geduld  Capital  Partners  LP, for the
                   purchase  of  up to  26,250  shares;  (7)  Gruber  &  McBaine
                   International,  for the purchase of up to 38,889 shares;  (8)
                   Irwin  Geduld  Revocable  Trust,  for the  purchase  of up to
                   17,500 shares; (9) J Patterson  McBaine,  for the purchase of
                   up to 15,555 shares;  (10) Jon D. Gruber and Linda W. Gruber,
                   for the  purchase  of up to  38,889  shares;  (11)  Lagunitas
                   Partners  LP, for the purchase of up to 93,333  shares;  (12)
                   Omicron  Master  Trust,  for  the  purchase  of up to  77,778
                   shares; (13) Palisades Master Fund, L.P., for the purchase of
                   up to  472,500  shares;  and  (14)  Stonestreet  LP,  for the
                   purchase of up to 54,444  shares.  Copies will be provided to
                   the Commission upon request.

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

         4.4      Loan  and  Security  Agreement  by and  between  the  Company,
                  subsidiaries  of the Company as signatories  thereto,  and PNC
                  Bank,  National  Association,  dated  December  22,  2000,  as
                  incorporated  by reference  from Exhibit 99.1 to the Company's
                  Form 8-K dated December 22, 2000.

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

         4.5      First  Amendment to Loan Agreement and Consent,  dated January
                  30,  2001,   between  the  Company  and  PNC  Bank,   National
                  Association as  incorporated by reference from Exhibit 99.7 to
                  the Company's Form 8-K dated January 31, 2001.

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

         4.6      Note and  Warrant  Purchase  Agreement,  dated July 31,  2001,
                  among the Company,  AMI, and BEC is  incorporated by reference
                  from Exhibit 99.1 to the  Company's  Form 8-K,  dated July 30,
                  2001.

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

         5.1      Opinion of Conner & Winters, P.C.

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

         10.1     Asset  Purchase  Agreement  dated March 23, 2004,  between the
                  Company  and USL  Environmental  Services,  Inc.,  a  Maryland
                  corporation,  d/b/a A & A  Environmental,  is  incorporated by
                  reference  from Exhibit 5.1 of our Current  Report on Form 8-K
                  dated March 23, 2004,  and filed on April 8, 2004. The Company
                  will furnish supplementally a copy of all omitted schedules to
                  the Commission upon request.

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

         10.2     Asset  Purchase  Agreement  dated March 23, 2004,  between the
                  Company and US Liquids of  Pennsylvania,  Inc., a Pennsylvania
                  corporation, d/b/a EMAX of Pittsburgh, Pa., is incorporated by
                  reference  from Exhibit 5.2 of our Current  Report on Form 8-K
                  dated March 23, 2004,  and filed on April 8, 2004. The Company
                  will furnish supplementally a copy of all omitted schedules to
                  the Commission upon request.

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


                                      II-2
<PAGE>

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

         10.3     Common Stock Purchase Warrant,  dated March 16, 2004,  granted
                  by the  Company  to R.  Keith  Fetter.  Substantially  similar
                  warrants were granted to Joe Dilustro and Chet Dubov, each for
                  the purchase of 30,000 shares of the  Company's  common stock.
                  Copies will be provided to the Commission upon request.

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

         23.1     Consent of BDO Seidman, LLP.

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

         23.2     Consent  of Conner & Winters,  as  contained  in  Exhibit  5.1
                  hereto and incorporated herein by reference.
--------------------------------------------------------------------------------


                                      II-3
<PAGE>

Item 17.  Undertakings

The Company hereby undertakes:

(1)   To file,  during any  period in which  offers or sales are being  made,  a
      post-effective amendment to the Registration Statement:

      (i)   To include any prospectus required by Section 10(a)(3) of the Act;

      (ii)  To reflect in the  prospectus  any facts or events arising after the
            effective  date of this  Registration  Statement (or the most recent
            post-effective  amendment  thereof)  which,  individually  or in the
            aggregate,  represent a fundamental  change in the  information  set
            forth in the Registration Statement;

      (iii) To include  any  material  information  with  respect to the plan of
            distribution not previously disclosed in the Registration  Statement
            or any  material  change  to such  information  in the  Registration
            Statement;

      Provided,  however, that paragraphs (1)(i) and (1)(ii) do not apply if the
      information required to be included in a post-effective amendment by those
      paragraphs is contained in periodic reports filed with or furnished to the
      Commission  by  the  Company  pursuant  to  Section  13 or  15(d)  of  the
      Securities Exchange Act of 1934, as amended (the "Exchange Act"), that are
      incorporated by reference in this Registration Statement.

(2)   That,  for the purpose of  determining  any liability  under the Act, each
      post-effective  amendment  shall  be  deemed  to  be  a  new  registration
      statement relating to the securities offered therein,  and the offering of
      such  securities  at the time shall be deemed to be the initial  bona fide
      offering thereof.

(3)   To remove from registration by means of a post-effective  amendment any of
      the securities  being registered which remain unsold at the termination of
      the offering.

The Company hereby  undertakes  that, for purposes of determining  any liability
under the Act,  each filing of the Company's  annual report  pursuant to Section
13(a) or 15(d) of the Exchange  Act (and,  where  applicable,  each filing of an
employee  benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is  incorporated by reference in the  Registration  Statement shall be
deemed to be a new  registration  statement  relating to the securities  offered
therein,  and the offering of such  securities at the time shall be deemed to be
the initial bona fide offering thereof.

Insofar  as  indemnification  for  liabilities  arising  under  the  Act  may be
permitted to directors, officers and controlling persons of the Company pursuant
to the indemnification  provisions  described herein, or otherwise,  the Company
has been advised that in the opinion of the Commission such  indemnification  is
against public policy as expressed in the Act and is, therefore,  unenforceable.
In the event that a claim for  indemnification  against such liabilities  (other
than the  payment by the  Company of  expenses  incurred  or paid by a director,
officer or controlling  person of the Company in the  successful  defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection  with the securities  being  registered,  the Company will,
unless in the opinion of its counsel the matter has been settled by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.


                                      II-4
<PAGE>

                             SIGNATURES FOR FORM S-3

      Pursuant to the requirements of the Act of 1933, the Registrant  certifies
that it has reasonable  grounds to believe that it meets all of the requirements
for filing on Form S-3 and has duly caused  this  registration  statement  to be
signed on its behalf by the undersigned,  thereunto duly authorized, in the City
of Gainesville, State of Florida, on the 30th day of April, 2004.


                                PERMA-FIX ENVIRONMENTAL SERVICES, INC.

                                By: /s/ Dr. Louis F. Centofanti
                                    ----------------------------------------
                                    Dr. Louis F. Centofanti
                                    Chairman of the Board
                                    Chief Executive Officer


                                POWER OF ATTORNEY

      Each person whose  signature  appears below  constitutes  and appoints Dr.
Louis F. Centofanti and Richard T. Kelecy,  and each of them, with full power of
substitution  and  resubstitution  and each with full power to act  without  the
other, his or her true and lawful attorney-in-fact and agent, for him or her and
in his or her name, place and stead, in any and all capacities,  to sign any and
all  amendments  (including  post-effective  amendments)  to  this  Registration
Statement,  and to file the  same,  with all  exhibits  thereto,  and all  other
documents in connection  therewith,  with the Securities and Exchange Commission
or any state, granting unto said attorneys-in-fact and agents, and each of them,
full  power  and  authority  to do and  perform  each and  every  act and  thing
requisite and  necessary to be done in and about the  premises,  as fully to all
intents and purposes as he or she might or could do in person,  hereby ratifying
and confirming all that said  attorneys-in-fact  and agents,  or any of them, or
their, his or her substitutes or substitute, may lawfully do or cause to be done
by virtue hereof.

      Pursuant to the requirements of the Act, this  Registration  Statement has
been  signed  by the  following  persons  in  the  capacities  and on the  dates
indicated.


<TABLE>
<CAPTION>
                SIGNATURE                              TITLE                        DATE
                ---------                              -----                        ----
<S>                                      <C>                                 <C>
/s/ Dr. Louis F. Centofanti
--------------------------------
Dr. Louis F. Centofanti                  Chairman of the Board of            April 30, 2004
                                         Directors, President, and Chief
                                         Executive Officer
                                         (Principal Executive Officer)


/s/ Richard T. Kelecy
--------------------------------
Richard T. Kelecy                        Chief Financial Officer             April 30, 2004
                                         (Principal Financial and
                                         Accounting Officer)


/s/ Jon Colin
--------------------------------
Jon Colin                                Director                            April 30, 2004


/s/ Jack Lahay
--------------------------------
Jack Lahav                               Director                            April 30, 2004


/s/ Joe R. Reeder
--------------------------------
Joe R. Reeder                            Director                            April 30, 2004

</TABLE>


                                      II-5
<PAGE>
<TABLE>
<CAPTION>
<S>                                      <C>                                 <C>
/s/ Alfred C. Warrington, IV
--------------------------------
Alfred C. Warrington, IV                 Director                            April 30, 2004


/s/ Dr. Charles E. Young
--------------------------------
Dr. Charles E. Young                     Director                            April 30, 2004


/s/ Mark A. Zwecker
--------------------------------
Mark A. Zwecker                          Director                            April 30, 2004
</TABLE>


                                      II-6

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>2
<FILENAME>v02991_ex4-1.txt
<TEXT>


                                  EXHIBIT 4.1

                          SECURITIES PURCHASE AGREEMENT

      This Securities Purchase Agreement (this "AGREEMENT") is dated as of March
16, 2004, among Perma-Fix Environmental  Services,  Inc., a Delaware corporation
(the  "COMPANY"),  and each purchaser  identified on the signature  pages hereto
(each,  including its successors and assigns, a "PURCHASER" and collectively the
"Purchasers"); and

      WHEREAS,  subject to the terms and  conditions set forth in this Agreement
and pursuant to Section 4(2) of the Securities Act (as defined below),  and Rule
506  promulgated  thereunder,  the  Company  desires  to issue  and sell to each
Purchaser,  and each Purchaser,  severally and not jointly,  desires to purchase
from the Company in the  aggregate,  up to $15,000,000 of shares of Common Stock
and Warrants on the Closing Date.

      NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement,  and for  other  good and  valuable  consideration  the  receipt  and
adequacy of which are hereby acknowledged, the Company and each Purchaser agrees
as follows:

                                   ARTICLE I.
                                   DEFINITIONS

      1.1  DEFINITIONS.  In  addition  to the terms  defined  elsewhere  in this
Agreement,  for all purposes of this  Agreement,  the  following  terms have the
meanings indicated in this Section 1.1:

            "2003 FORM 10-K" means the Company's  Annual Report on Form 10-K for
      the fiscal year ended December 31, 2003, as filed with the Commission.

            "ACTION"  shall have the  meaning  ascribed  to such term in Section
      3.1(j).

            "AFFILIATE"  means any Person that,  directly or indirectly  through
      one or more  intermediaries,  controls  or is  controlled  by or is  under
      common control with a Person as such terms are used in and construed under
      Rule 144.  With respect to a  Purchaser,  any  investment  fund or managed
      account that is managed on a  discretionary  basis by the same  investment
      manager  as such  Purchaser  will be  deemed  to be an  Affiliate  of such
      Purchaser.

            "CLOSING"  means the closing of the  purchase and sale of the Common
      Stock and the Warrants pursuant to Section 2.1.

            "CLOSING  DATE" means the  Trading  Day when all of the  Transaction
      Documents  have been  executed  and  delivered by the  applicable  parties
      thereto, and all conditions  precedent to (i) the Purchasers'  obligations
      to pay the  Subscription  Amount  and (ii) the  Company's  obligations  to
      deliver the Securities have been satisfied or waived.


                                       1
<PAGE>


            "CLOSING  PRICE" means on any particular  date (a) the last reported
      closing  bid price per share of Common  Stock on such date on the  Trading
      Market (as reported by Bloomberg  L.P. at 4:15 PM (New York time),  or (b)
      if there is no such price on such date,  then the closing bid price on the
      Trading  Market on the date  nearest  preceding  such date (as reported by
      Bloomberg  L.P.  at 4:15 PM (New York time) for the  closing bid price for
      regular  session  trading on such day),  or (c) if the Common Stock is not
      then  listed or quoted on a Trading  Market  and if prices  for the Common
      Stock are then quoted on the OTC Bulletin Board,  the closing bid price of
      the Common Stock for such date (or the nearest  preceding date) on the OTC
      Bulletin  Board (as reported by Bloomberg L.P. at 4:15 PM (New York time),
      (d) if the Common Stock is not then listed or quoted on the Trading Market
      and if prices for the Common Stock are then  reported in the "pink sheets"
      published by the Pink Sheets LLC (formerly the National  Quotation  Bureau
      Incorporated  (or a  similar  organization  or  agency  succeeding  to its
      functions of reporting prices), the most recent bid price per share of the
      Common  Stock so  reported,  or (e) if the shares of Common  Stock are not
      then  publicly  traded the fair market value of a share of Common Stock as
      determined by a qualified  independent appraiser selected in good faith by
      the Purchasers of a majority in interest of the Shares then outstanding.

            "COMMISSION" means the Securities and Exchange Commission.

            "COMMON  STOCK" means the common  stock of the  Company,  $0.001 par
      value per share,  and any  securities  into which  such  common  stock may
      hereafter be reclassified.

            "COMMON STOCK  EQUIVALENTS"  means any  securities of the Company or
      the Subsidiaries  which would entitle the holder thereof to acquire at any
      time Common  Stock,  including  without  limitation,  any debt,  preferred
      stock, rights,  options,  warrants or other instrument that is at any time
      convertible  into or  exchangeable  for, or otherwise  entitles the holder
      thereof to receive, Common Stock.

            "COMPANY COUNSEL" means Conner & Winters, P.C.

            "DISCLOSURE SCHEDULES" means the disclosure schedules of the Company
      delivered concurrently herewith.

            "EFFECTIVE DATE" means the date that the  Registration  Statement is
      first declared effective by the Commission.

            "ESCROW  AGENT"  shall  have the  meaning  set  forth in the  Escrow
      Agreement.

            "ESCROW  AGREEMENT" shall mean the Escrow Agreement in substantially
      the form of EXHIBIT D hereto executed and delivered contemporaneously with
      this Agreement.


                                       2
<PAGE>

            "EXCHANGE  ACT"  means  the  Securities  Exchange  Act of  1934,  as
      amended.

            "EXEMPT  ISSUANCE"  means the issuance of (a) shares of Common Stock
      or options to  employees,  bona fide  consultants,  bona fide  prospective
      employees,  officers or directors of the Company  pursuant to any stock or
      option plan duly adopted by a majority of the non-employee  members of the
      Board of  Directors  of the  Company  or a  majority  of the  members of a
      committee of  non-employee  directors  established for such purpose or (b)
      securities   upon  the  exercise  of  or  conversion  of  any  convertible
      securities, options or warrants issued and outstanding on the date of this
      Agreement,  provided that such  securities have not been amended since the
      date of this Agreement.

            "FORCE  MAJEURE"  shall mean any unusual  event  arising from causes
      reasonably  beyond the control of the Company that could not be reasonably
      anticipated  that causes a delay in or  prevents  the  performance  of any
      obligation  under this  Agreement or the agreements  contemplated  hereby,
      including  but  not  limited  to:  acts  of  God;  fire;  war;  terrorism;
      insurrection;  civil  disturbance;  explosion;  adverse weather conditions
      that could not be reasonably anticipated; unusual delay in transportation;
      strikes or other  labor  disputes;  restraint  by court  order or order of
      public  authority but  specifically not including any event resulting from
      the  failure  of the  Commission  or  Company's  transfer  agent to act or
      perform any function.

            "FW"  means  Feldman  Weinstein  LLP  with  offices  located  at 420
      Lexington Avenue, Suite 2620, New York, New York 10170-0002.

            "INTELLECTUAL  PROPERTY  RIGHTS" shall have the meaning  ascribed to
      such term in Section 3.1(o).

            "LIENS" means a lien, charge, security interest,  encumbrance, right
      of first refusal, preemptive right or other restriction.

            "MATERIAL  ADVERSE  EFFECT" shall have the meaning  ascribed to such
      term in Section 3.1(b).

            "MATERIAL  PERMITS" shall have the meaning  ascribed to such term in
      Section 3.1(m).

            "PER SHARE PURCHASE  PRICE" equals $2.25,  subject to adjustment for
      reverse and forward stock splits, stock dividends,  stock combinations and
      other similar  transactions  of the Common Stock that occur after the date
      of this Agreement.

            "PERSON"  means an individual or  corporation,  partnership,  trust,
      incorporated  or  unincorporated   association,   joint  venture,  limited
      liability  company,  joint  stock  company,  government  (or an  agency or
      subdivision thereof) or other entity of any kind.


                                       3
<PAGE>


            "PROCEEDING"  means  an  action,   claim,  suit,   investigation  or
      proceeding  (including,  without  limitation,  an investigation or partial
      proceeding, such as a deposition), whether commenced or threatened.

            "REGISTRATION   RIGHTS  AGREEMENT"  means  the  Registration  Rights
      Agreement,  dated as of the date of this Agreement,  among the Company and
      each Purchaser, in the form of EXHIBIT A hereto.

            "REGISTRATION  STATEMENT" means a registration statement meeting the
      requirements set forth in the  Registration  Rights Agreement and covering
      the resale by the Purchasers of the Shares and the Warrant Shares.

            "REQUIRED APPROVALS" shall have the meaning ascribed to such term in
      Section 3.1(e).

            "RULE 144" means Rule 144 promulgated by the Commission  pursuant to
      the Securities  Act, as such Rule may be amended from time to time, or any
      similar rule or  regulation  hereafter  adopted by the  Commission  having
      substantially the same effect as such Rule.

            "SEC  REPORTS"  shall  have the  meaning  ascribed  to such  term in
      Section 3.1(h).

            "SECURITIES" means the Shares, the Warrants and the Warrant Shares.

            "SECURITIES ACT" means the Securities Act of 1933, as amended.

            "SHARES" means the shares of Common Stock issued or issuable to each
      Purchaser pursuant to this Agreement.

            "SUBSCRIPTION  AMOUNT" means, as to each Purchaser,  the amounts set
      forth below such Purchaser's signature block on the signature page hereto,
      in United States dollars and in immediately available funds.

            "SUBSIDIARY" shall mean the subsidiaries of the Company, if any, set
      forth on SCHEDULE 3.1(A).

            "TRADING  DAY" means a day on which the Common  Stock is traded on a
      Trading Market.

            "TRADING  MARKET" means the following  markets or exchanges on which
      the Common  Stock is listed or quoted for trading on the date in question:
      the Nasdaq  SmallCap  Market,  the American Stock  Exchange,  the New York
      Stock Exchange, the Nasdaq National Market or the OTC Bulletin Board.

            "TRANSACTION  DOCUMENTS"  means this  Agreement,  the Warrants,  the
      Escrow  Agreement  and the  Registration  Rights  Agreement  and any other
      documents  or  agreements  executed in  connection  with the  transactions
      contemplated hereunder.


                                       4
<PAGE>


            "WARRANTS" means the Common Stock Purchase Warrants,  in the form of
      EXHIBIT B, issuable to the Purchasers at the Closing, which warrants shall
      be exercisable immediately upon issuance for a term of 3 years and have an
      exercise price equal to $2.92 per share.

            "WARRANT  SHARES"  means the shares of Common  Stock  issuable  upon
      exercise of the Warrants.

                                   ARTICLE II.
                               PURCHASE AND SALE

      2.1 CLOSING.  On the Closing Date,  each Purchaser shall purchase from the
Company,  severally and not jointly with the other  Purchasers,  and the Company
shall  issue and sell to each  Purchaser,  (a) a number of Shares  equal to such
Purchaser's  Subscription Amount divided by the Per Share Purchase Price and (b)
the  Warrants as  determined  pursuant  to Section  2.2(a)(iii).  The  aggregate
Subscription Amounts for Shares sold hereunder shall be up to $15,000,000.  Upon
satisfaction of the conditions set forth in Section 2.2, the Closing shall occur
at the offices of the Escrow Agent or such other  location as the parties  shall
mutually agree.

      2.2 CLOSING CONDITIONS; DELIVERIES.

            (a) On the Closing  Date,  the Company  shall deliver or cause to be
      delivered  to  the  Escrow  Agent  with  respect  to  each  Purchaser  the
      following:

                  (i) this Agreement duly executed by the Company;

                  (ii) a number of Shares equal to such Purchaser's Subscription
            Amount  divided by the Per Share  Purchase  Price  registered in the
            name of such Purchaser;

                  (iii) a  Warrant,  registered  in the name of such  Purchaser,
            pursuant to which such Purchaser  shall have the right to acquire up
            to the number of shares of Common  Stock  equal to 35% of the Shares
            to be issued to such Purchaser at the Closing;

                  (iv) the  Registration  Rights  Agreement duly executed by the
            Company;

                  (v) the Escrow Agreement duly executed by the Company; and

                  (vi) a  legal  opinion  of  Company  Counsel,  in the  form of
            EXHIBIT C attached hereto.


                                       5
<PAGE>


            (b) On the Closing Date, each Purchaser shall deliver or cause to be
      delivered to the Escrow Agent the following:

                  (i) this Agreement duly executed by such Purchaser;

                  (ii) such Purchaser's  Subscription Amount by wire transfer to
            the account of the Escrow Agent;

                  (iii) the Escrow  Agreement  duly executed by such  Purchaser;
            and

                  (iv) the  Registration  Rights Agreement duly executed by such
            Purchaser.

            (c) All  representations and warranties of the other party contained
      herein  shall  remain  true and  correct  as of the  Closing  Date and all
      covenants  of the other  party shall have been  performed  if due prior to
      such date.

            (d) From the date hereof to the Closing Date,  trading in the Common
      Stock  shall not have been  suspended  by the  Commission  (except for any
      suspension of trading of limited duration agreed to by the Company,  which
      suspension  shall be terminated  prior to the  Closing),  and, at any time
      prior to the Closing Date, trading in securities  generally as reported by
      Bloomberg  Financial Markets shall not have been suspended or limited,  or
      minimum prices shall not have been  established on securities whose trades
      are  reported  by such  service,  or on any  Trading  Market,  nor shall a
      banking  moratorium  have been declared either by the United States or New
      York State authorities nor shall there have occurred any material outbreak
      or escalation of hostilities or other national or  international  calamity
      of such magnitude in its effect on, or any material adverse change in, any
      financial  market which, in each case, in the reasonable  judgment of each
      Purchaser, makes it impracticable or inadvisable to purchase the Shares at
      the Closing.

                                  ARTICLE III.
                         REPRESENTATIONS AND WARRANTIES

      3.1  REPRESENTATIONS  AND  WARRANTIES OF THE COMPANY.  Except as set forth
under the  corresponding  section of the Disclosure  Schedules which  Disclosure
Schedules  shall  be  deemed  a  part  hereof,  the  Company  hereby  makes  the
representations and warranties set forth below to each Purchaser:

            (a) SUBSIDIARIES. All of the direct and indirect subsidiaries of the
      Company are set forth on SCHEDULE  3.1(A).  The Company owns,  directly or
      indirectly,  all of the capital  stock or other  equity  interests of each
      Subsidiary free and clear of any Liens, and all the issued and outstanding
      shares of capital  stock of each  Subsidiary  are  validly  issued and are
      fully paid,  non-assessable  and free of preemptive  and similar rights to
      subscribe for or purchase securities.  If the Company has no subsidiaries,
      then references in the Transaction  Documents to the Subsidiaries  will be
      disregarded.


                                       6
<PAGE>


            (b)  ORGANIZATION  AND  QUALIFICATION.  Each of the  Company and the
      Subsidiaries  is an  entity  duly  incorporated  or  otherwise  organized,
      validly  existing and in good standing under the laws of the  jurisdiction
      of its  incorporation or organization (as applicable),  with the requisite
      power and authority to own and use its  properties and assets and to carry
      on its  business  as  currently  conducted.  Neither  the  Company nor any
      Subsidiary  is in  violation  or default of any of the  provisions  of its
      respective  certificate  or  articles  of  incorporation,  bylaws or other
      organizational  or  charter  documents.   Each  of  the  Company  and  the
      Subsidiaries is duly qualified to conduct business and is in good standing
      as a foreign corporation or other entity in each jurisdiction in which the
      nature  of the  business  conducted  or  property  owned by it makes  such
      qualification necessary, except where the failure to be so qualified or in
      good  standing,  as the case may be,  would  have (i) a  material  adverse
      effect on the  legality,  validity or  enforceability  of any  Transaction
      Document,  or (ii) a material adverse effect on the results of operations,
      assets, business,  prospects or financial condition of the Company and the
      Subsidiaries,  taken as a whole,  (any of (i) or (ii), a "MATERIAL ADVERSE
      EFFECT") and no Proceeding  has been  instituted in any such  jurisdiction
      revoking,  limiting or curtailing  or seeking to revoke,  limit or curtail
      such power and authority or qualification.

            (c)  AUTHORIZATION;  ENFORCEMENT.  The  Company  has  the  requisite
      corporate  power  and  authority  to  enter  into  and to  consummate  the
      transactions  contemplated  by  each  of  the  Transaction  Documents  and
      otherwise  to carry out its  obligations  thereunder.  The  execution  and
      delivery  of each of the  Transaction  Documents  by the  Company  and the
      consummation by it of the transactions contemplated thereby have been duly
      authorized  by all  necessary  action  on the part of the  Company  and no
      further  action is required by the Company in connection  therewith  other
      than in connection with the Required Approvals.  Each Transaction Document
      has been (or upon  delivery  will have been) duly  executed by the Company
      and, when delivered in accordance  with the terms hereof,  will constitute
      the valid and binding  obligation of the Company  enforceable  against the
      Company in  accordance  with its terms except (i) as limited by applicable
      bankruptcy,  insolvency,  reorganization,  moratorium  and  other  laws of
      general application  affecting  enforcement of creditors' rights generally
      and (ii) as limited  by laws  relating  to the  availability  of  specific
      performance, injunctive relief or other equitable remedies.


                                       7
<PAGE>

            (d) NO CONFLICTS.  The  execution,  delivery and  performance of the
      Transaction  Documents by the Company, the issuance and sale of the Shares
      and the consummation by the Company of the other transactions contemplated
      thereby do not and will not (i) conflict  with or violate any provision of
      the   Company's   or  any   Subsidiary's   certificate   or   articles  of
      incorporation,  bylaws or other  organizational or charter  documents,  or
      (ii) conflict  with, or constitute a default (or an event that with notice
      or lapse of time or both  would  become a  default)  under,  result in the
      creation of any Lien upon any of the  properties  or assets of the Company
      or any Subsidiary, or give to others any rights of termination, amendment,
      acceleration  or cancellation  (with or without  notice,  lapse of time or
      both)  of,  any  agreement,  credit  facility,  debt or  other  instrument
      (evidencing  a  Company  or   Subsidiary   debt  or  otherwise)  or  other
      understanding  to which the  Company  or any  Subsidiary  is a party or by
      which any property or asset of the Company or any  Subsidiary  is bound or
      affected,  or (iii)  subject to the Required  Approvals,  conflict with or
      result in a  violation  of any law,  rule,  regulation,  order,  judgment,
      injunction,  decree  or other  restriction  of any  court or  governmental
      authority  to which the  Company or a  Subsidiary  is  subject  (including
      federal  and  state  securities  laws and  regulations),  or by which  any
      property or asset of the Company or a Subsidiary is bound or affected,  or
      (iv)  conflict  with or violate  the terms of any  agreement  by which the
      Company or any  Subsidiary  is bound or to which any  property or asset of
      the Company or any Subsidiary is bound or affected;  except in the case of
      each of clauses (ii) and (iii),  such as would not have or  reasonably  be
      expected to result in a Material Adverse Effect.

            (e) FILINGS,  CONSENTS AND APPROVALS. The Company is not required to
      obtain any consent, waiver, authorization or order of, give any notice to,
      or make any  filing or  registration  with,  any  court or other  federal,
      state, local or other governmental authority or other Person in connection
      with  the  execution,  delivery  and  performance  by the  Company  of the
      Transaction Documents, other than (i) filings required pursuant to Section
      4.4 of  this  Agreement,  (ii)  the  filing  with  the  Commission  of the
      Registration  Statement the  prospectus  contained  therein,  and pre- and
      post-effective supplements and amendments thereto, (iii) application(s) to
      each  applicable  Trading  Market and the Boston  Stock  Exchange  for the
      listing of the Shares and Warrant  Shares for trading  thereon in the time
      and  manner  required  thereby,  and  (iv) the  filing  of Form D with the
      Commission  and  such  filings  as are  required  based  on the  Company's
      determination   to  be  made  under   applicable   state  securities  laws
      (collectively, the "REQUIRED APPROVALS").

            (f)  ISSUANCE OF THE  SECURITIES.  The Shares and  Warrants are duly
      authorized   and,  when  issued  and  paid  for  in  accordance  with  the
      Transaction  Documents,  will be duly and validly  issued,  fully paid and
      nonassessable,  free and clear of all Liens  imposed by the Company  other
      than restrictions on transfer  provided for in the Transaction  Documents.
      The  Warrant  Shares,  when  issued  in  accordance  with the terms of the
      Transaction   Documents,   will  be   validly   issued,   fully  paid  and
      nonassessable,  free and clear of all Liens  imposed by the  Company.  The
      Company has reserved  from its duly  authorized  capital stock the maximum
      number of shares of Common Stock  issuable  pursuant to this Agreement and
      the Warrants.


                                       8
<PAGE>


            (g)  CAPITALIZATION.   The  capitalization  of  the  Company  is  as
      described  in the  Company's  most recent  periodic  report filed with the
      Commission. The Company has not issued any capital stock since such filing
      other than  pursuant to the exercise of employee  stock  options under the
      Company's  stock option  plans,  the issuance of shares of Common Stock to
      employees  pursuant to the  Company's  employee  stock  purchase  plan and
      pursuant  to the  conversion  or  exercise  of  outstanding  Common  Stock
      Equivalents.  No Person has any right of first refusal,  preemptive right,
      right  of  participation,  or any  similar  right  to  participate  in the
      transactions contemplated by the Transaction Documents. Except as a result
      of the  purchase  and sale of the  Securities,  there  are no  outstanding
      options,  warrants, script rights to subscribe to, calls or commitments of
      any character whatsoever relating to, or securities, rights or obligations
      convertible  into or  exchangeable  for, or giving any Person any right to
      subscribe  for or  acquire,  any  shares of Common  Stock,  or  contracts,
      commitments,  understandings  or  arrangements by which the Company or any
      Subsidiary  is or may become  bound to issue  additional  shares of Common
      Stock, or securities or rights  convertible or exchangeable into shares of
      Common  Stock  other than  pursuant to the  Company's  stock plans and its
      outstanding Common Stock Equivalents. The issue and sale of the Securities
      will not  obligate  the Company to issue  shares of Common  Stock or other
      securities to any Person (other than the  Purchasers)  and will not result
      in a right of any holder of  Company  securities  to adjust the  exercise,
      conversion,  exchange  or reset price  under such  securities.  All of the
      outstanding  shares of capital  stock of the Company  are validly  issued,
      fully paid and  nonassessable,  have been  issued in  compliance  with all
      federal and state securities laws, and none of such outstanding shares was
      issued  in  violation  of any  preemptive  rights  or  similar  rights  to
      subscribe for or purchase securities. No further approval or authorization
      of any  stockholder,  the Board of  Directors  of the Company or others is
      required for the issuance and sale of the Shares,  other than the Required
      Approvals.   Except  as  disclosed  in  the  SEC  Reports,  there  are  no
      stockholders  agreements,  voting  agreements or other similar  agreements
      with  respect to the  Company's  capital  stock to which the  Company is a
      party or, to the  knowledge  of the  Company,  between or among any of the
      Company's stockholders.

            (h) SEC  REPORTS;  FINANCIAL  STATEMENTS.  The Company has filed all
      reports  required  to be  filed  by it under  the  Securities  Act and the
      Exchange Act,  including  pursuant to Section 13(a) or 15(d) thereof,  for
      the two years  preceding  the date hereof (or such  shorter  period as the
      Company was  required by law to file such  material),  including  the 2003
      Form 10-K (the foregoing materials,  including the exhibits thereto, being
      collectively referred to herein as the "SEC REPORTS") on a timely basis or
      has  received a valid  extension  of such time of filing and has filed any
      such SEC Reports  prior to the  expiration  of any such  extension.  As of
      their respective  dates, the SEC Reports complied in all material respects
      with the  requirements  of the Securities Act and the Exchange Act and the
      rules and regulations of the Commission promulgated  thereunder,  and none
      of the SEC  Reports,  when  filed,  contained  any untrue  statement  of a
      material  fact or omitted to state a material  fact  required to be stated
      therein or necessary in order to make the statements  therein, in light of
      the  circumstances  under  which  they  were  made,  not  misleading.  The
      financial  statements of the Company included in the SEC Reports comply in
      all material  respects with  applicable  accounting  requirements  and the
      rules and  regulations of the Commission with respect thereto as in effect
      at the time of filing.  Such  financial  statements  have been prepared in
      accordance with United States  generally  accepted  accounting  principles
      applied on a consistent basis during the periods involved ("GAAP"), except
      as may be otherwise  specified in such  financial  statements or the notes
      thereto and except that unaudited financial statements may not contain all
      footnotes  required by GAAP, and fairly  present in all material  respects
      the financial position of the Company and its consolidated subsidiaries as
      of and for the dates thereof and the results of operations  and cash flows
      for the periods then ended,  subject, in the case of unaudited statements,
      to normal, immaterial, year-end audit adjustments.


                                       9
<PAGE>


            (i) MATERIAL CHANGES. Since the date of the latest audited financial
      statements  included  within  the  SEC  Reports,  except  as  specifically
      disclosed in the SEC Reports,  (i) there has been no event,  occurrence or
      development  that would  result in a  Material  Adverse  Effect,  (ii) the
      Company has not incurred any liabilities  (contingent or otherwise)  other
      than (A) trade  payables  and accrued  expenses  incurred in the  ordinary
      course of business  consistent  with past practice and (B) liabilities not
      required to be reflected in the Company's financial statements pursuant to
      GAAP or  required to be  disclosed  in filings  made with the  Commission,
      (iii) the  Company  has not  altered  its method of  accounting,  (iv) the
      Company has not declared or made any dividend or  distribution  of cash or
      other  property to its  stockholders  or  purchased,  redeemed or made any
      agreements  to purchase or redeem any shares of its capital  stock and (v)
      the Company has not issued any equity securities to any officer,  director
      or Affiliate,  except  pursuant to existing  Company stock option plans or
      stock  purchase  plans.  The  Company  does not have  pending  before  the
      Commission any request for confidential treatment of information.

            (j)  LITIGATION.  There  is no  action,  suit,  inquiry,  notice  of
      violation, proceeding or investigation pending or, to the knowledge of the
      Company,  threatened  against or affecting the Company,  any Subsidiary or
      any of their  respective  properties  before or by any court,  arbitrator,
      governmental or administrative  agency or regulatory  authority  (federal,
      state,  county,  local or foreign)  (collectively,  an "ACTION") which (i)
      adversely  affects or challenges the legality,  validity or enforceability
      of any of the  Transaction  Documents or the Securities or (ii) would,  if
      there were an  unfavorable  decision,  have or  reasonably  be expected to
      result  in  a  Material  Adverse  Effect.  Neither  the  Company  nor  any
      Subsidiary,  nor any  director  or  officer  thereof,  is or has  been the
      subject of any Action involving a claim of violation of or liability under
      federal or state  securities  laws or a claim of breach of fiduciary duty.
      There has not been,  and to the  knowledge  of the  Company,  there is not
      pending or contemplated, any investigation by the Commission involving the
      Company or any current or former  director or officer of the Company.  The
      Commission  has not issued any stop order or other  order  suspending  the
      effectiveness  of any  registration  statement filed by the Company or any
      Subsidiary under the Exchange Act or the Securities Act.

            (k) LABOR  RELATIONS.  No material  labor dispute  exists or, to the
      knowledge of the Company, is imminent with respect to any of the employees
      of the Company which would result in a Material Adverse Effect.


                                       10
<PAGE>


            (l)  COMPLIANCE.  Neither the Company nor any  Subsidiary  (i) is in
      default  under or in violation of (and no event has occurred  that has not
      been waived that, with notice or lapse of time or both,  would result in a
      default by the Company or any  Subsidiary  under),  nor has the Company or
      any Subsidiary  received  notice of a claim that it is in default under or
      that it is in violation of, any indenture, loan or credit agreement or any
      other agreement or instrument to which it is a party or by which it or any
      of its  properties is bound  (whether or not such default or violation has
      been waived),  (ii) is in violation of any order of any court,  arbitrator
      or governmental body, or (iii) is or has been in violation of any statute,
      rule  or  regulation  of any  governmental  authority,  including  without
      limitation all foreign,  federal,  state and local laws  applicable to its
      business except in each case as would not have a Material Adverse Effect.

            (m) REGULATORY PERMITS. The Company and the Subsidiaries possess all
      certificates,   authorizations  and  permits  issued  by  the  appropriate
      federal,  state,  local or foreign  regulatory  authorities  necessary  to
      conduct  their  respective  businesses  as  described  in the SEC Reports,
      except  where  the  failure  to  possess  such  permits  would not have or
      reasonably be expected to result in a Material  Adverse Effect  ("MATERIAL
      PERMITS"),  and neither the Company nor any  Subsidiary  has  received any
      notice of proceedings  relating to the revocation or  modification  of any
      Material Permit.

            (n) TITLE TO ASSETS.  The Company and the Subsidiaries have good and
      marketable  title in fee simple to all real property owned by them that is
      material to the business of the Company and the  Subsidiaries and good and
      marketable  title in all personal  property owned by them that is material
      to the business of the Company and the Subsidiaries, in each case free and
      clear of all Liens, except for Liens as do not materially affect the value
      of such  property and do not  materially  interfere  with the use made and
      proposed to be made of such  property by the Company and the  Subsidiaries
      and Liens for the payment of federal, state or other taxes, the payment of
      which is neither  delinquent  nor subject to penalties.  Any real property
      and facilities  held under lease by the Company and the  Subsidiaries  are
      held by them under valid,  subsisting and enforceable  leases of which the
      Company and the Subsidiaries are in compliance.

            (o) PATENTS AND TRADEMARKS.  The Company and the Subsidiaries  have,
      or have  rights to use,  all  patents,  patent  applications,  trademarks,
      trademark applications,  service marks, trade names, copyrights,  licenses
      and other similar rights  necessary or material for use in connection with
      their respective  businesses as described in the SEC Reports and which the
      failure to so would  have a Material  Adverse  Effect  (collectively,  the
      "INTELLECTUAL  PROPERTY  RIGHTS").  Neither the Company nor any Subsidiary
      has received a written notice that the  Intellectual  Property Rights used
      by the Company or any Subsidiary  violates or infringes upon the rights of
      any  Person.  To the  knowledge  of the  Company,  all  such  Intellectual
      Property Rights are  enforceable and there is no existing  infringement by
      another Person of any of the Intellectual Property Rights of others.


                                       11
<PAGE>


            (p)  INSURANCE.  The  Company  and the  Subsidiaries  are insured by
      insurers of recognized  financial  responsibility  against such losses and
      risks and in such amounts as are prudent and  customary in the  businesses
      in which the  Company and the  Subsidiaries  are  engaged.  To the best of
      Company's  knowledge,  such insurance  contracts and policies are accurate
      and  complete.  Neither the Company nor any  Subsidiary  has any reason to
      believe that it will not be able to renew its existing  insurance coverage
      as and when such  coverage  expires  or to obtain  similar  coverage  from
      similar  insurers as may be necessary  to continue its business  without a
      significant increase in cost.

            (q) TRANSACTIONS WITH AFFILIATES AND EMPLOYEES.  Except as set forth
      in the SEC  Reports,  none of the  executive  officers or directors of the
      Company is  presently a party to any  transaction  with the Company or any
      Subsidiary (other than for services as executive  officers and directors),
      including any contract,  agreement or other arrangement  providing for the
      furnishing of services to or by,  providing for rental of real or personal
      property  to or  from,  or  otherwise  requiring  payments  to or from any
      executive  officer or director or, to the  knowledge  of the Company,  any
      entity  in which any  executive  officer  or  director  has a  substantial
      interest or is an officer,  director,  trustee or partner, in each case in
      excess of $60,000 other than (i) for payment of salary or consulting  fees
      for services rendered,  (ii) reimbursement for expenses incurred on behalf
      of the  Company and (iii) for other  employee  benefits,  including  stock
      option agreements under any stock option plan of the Company.

            (r) SARBANES-OXLEY;  INTERNAL ACCOUNTING CONTROLS. The Company is in
      material  compliance with all provisions of the Sarbanes-Oxley Act of 2002
      which are  applicable  to it as of the Closing  Date.  Since  December 31,
      2003,  there have been no  significant  changes in the Company's  internal
      controls (as such term is defined in Item 307(b) of  Regulation  S-K under
      the Exchange  Act) or, to the Company's  knowledge,  in other factors that
      could significantly affect the Company's internal controls.

            (s) CERTAIN FEES. No brokerage or finder's fees or  commissions  are
      or will be payable  by the  Company to any  broker,  financial  advisor or
      consultant,  finder,  placement agent,  investment  banker,  bank or other
      Person with respect to the  transactions  contemplated  by this Agreement.
      The Purchasers  shall have no obligation  with respect to any fees or with
      respect to any claims made by or on behalf of other  Persons for fees of a
      type  contemplated  in this Section that may be due in connection with the
      transactions contemplated by this Agreement.

            (t) PRIVATE  PLACEMENT.  Assuming  the  accuracy  of the  Purchasers
      representations  and warranties set forth in Section 3.2, no  registration
      under  the  Securities  Act is  required  for the  offer  and  sale of the
      Securities by the Company to the Purchasers as contemplated hereby, except
      as required by the terms of the  Transaction  Documents.  The issuance and
      sale of the  Securities  hereunder  does  not  contravene  the  rules  and
      regulations of the Trading Market.


                                       12
<PAGE>


            (u) INVESTMENT COMPANY.  The Company is not, and is not an Affiliate
      of, and immediately  after receipt of payment for the Shares,  will not be
      or be an Affiliate of, an "investment  company"  within the meaning of the
      Investment Company Act of 1940, as amended.  The Company shall conduct its
      business in a manner so that it will not become  subject to the Investment
      Company Act.

            (v) REGISTRATION RIGHTS.  Except as set forth in SCHEDULE 3.1(V), no
      Person has any right to cause the Company to effect the registration under
      the Securities Act of any securities of the Company.

            (w) LISTING AND MAINTENANCE REQUIREMENTS. The Company's Common Stock
      is  registered  pursuant to Section  12(b) of the  Exchange  Act,  and the
      Company  has taken no action  designed  to, or which to its  knowledge  is
      likely to have the effect of,  terminating the  registration of the Common
      Stock under the Exchange Act nor has the Company received any notification
      that the Commission is contemplating  terminating such  registration.  The
      Company  has not, in the 12 months  preceding  the date  hereof,  received
      notice  from any Trading  Market on which the Common  Stock is or has been
      listed or quoted to the effect that the Company is not in compliance  with
      the  listing or  maintenance  requirements  of such  Trading  Market.  The
      Company  is,  and  has no  reason  to  believe  that  it  will  not in the
      foreseeable future continue to be, in compliance with all such listing and
      maintenance requirements.

            (x)  APPLICATION  OF  TAKEOVER  PROTECTIONS.  Assuming  none  of the
      Purchasers,  individually or as a "group" as described in Section 13(d)(3)
      of the Securities  Act,  beneficially  own more than 4.99% of Common Stock
      for  purposes  of  this  representation,  the  Company  and its  Board  of
      Directors  have not and will not  adopt any  poison  pill  (including  any
      distribution  under a rights  agreement)  or other  similar  anti~takeover
      provision  under the Company's  Certificate of  Incorporation  (or similar
      charter documents) that would prohibit the Purchasers and the Company from
      fulfilling  their   obligations  or  exercising  their  rights  under  the
      Transaction Documents, including without limitation the Company's issuance
      of the Securities and the Purchasers' ownership of the Securities acquired
      under the terms of this Agreement.

            (y) DISCLOSURE.  The Company confirms that,  neither the Company nor
      any other Person  acting on its behalf has provided any of the  Purchasers
      or their agents or counsel with any information  that constitutes or might
      constitute material,  non-public information.  The Company understands and
      confirms that the  Purchasers  will rely on the foregoing  representations
      and covenants in effecting  transactions in securities of the Company. All
      disclosure provided to the Purchasers  regarding the Company, its business
      and the transactions  contemplated hereby, including the Schedules to this
      Agreement,  furnished  by or on behalf of the Company  with respect to the
      representations  and  warranties  made  herein are true and  correct  with
      respect to such  representations  and  warranties  and do not  contain any
      untrue  statement of a material  fact or omit to state any  material  fact
      necessary in order to make the  statements  made therein,  in light of the
      circumstances  under  which they were made,  not  misleading.  The Company
      acknowledges   and  agrees  that  no  Purchaser  makes  or  has  made  any
      representations   or   warranties   with   respect  to  the   transactions
      contemplated  hereby  other  than  those  specifically  set  forth  in the
      Transaction Documents.


                                       13
<PAGE>


            (z) NO INTEGRATED OFFERING. Assuming the accuracy of the Purchasers'
      representations  and  warranties  set forth in Section  3.2,  neither  the
      Company, nor any of its affiliates,  nor any Person acting on its or their
      behalf  has,  directly  or  indirectly,  made any  offers  or sales of any
      security or solicited any offers to buy any security,  under circumstances
      that would cause this offering of the  Securities  to be  integrated  with
      prior  offerings by the Company for purposes of the  Securities Act or any
      applicable shareholder approval provisions, including, without limitation,
      under the rules and  regulations  of any exchange or  automated  quotation
      system  on which  any of the  securities  of the  Company  are  listed  or
      designated.

            (aa) Intentionally Omitted.

            (bb) FORM S-3  ELIGIBILITY.  The Company is eligible to register the
      resale of its Common Stock by the  Purchasers  under Form S-3  promulgated
      under the Securities  Act and the Company  hereby  covenants and agrees to
      use its best efforts to maintain its eligibility to use Form S-3 until the
      Registration  Statement  covering the resale of the Shares shall have been
      filed with, and declared effective by, the Commission.

            (cc) TAXES.  Except for matters that would not,  individually  or in
      the  aggregate,  would  have or  reasonably  be  expected  to  result in a
      Material  Adverse  Effect,  the Company and each  Subsidiary has filed all
      necessary federal,  state and foreign income and franchise tax returns and
      has paid or accrued all taxes shown as due thereon, and the Company has no
      knowledge  of a tax  deficiency  which  has been  asserted  or  threatened
      against the Company or any Subsidiary.

            (dd) GENERAL SOLICITATION. Neither the Company nor any person acting
      on behalf of the Company has offered or sold any of the Shares by any form
      of general  solicitation or general  advertising.  The Company has offered
      the Shares for sale only to the Purchasers  and certain other  "accredited
      investors" within the meaning of Rule 501 under the Securities Act.

            (ee) FOREIGN  CORRUPT  PRACTICES.  Neither the  Company,  nor to the
      knowledge  of the Company,  any agent or other person  acting on behalf of
      the Company,  has (i) directly or  indirectly,  used any corrupt funds for
      unlawful  contributions,  gifts,  entertainment or other unlawful expenses
      related to foreign or domestic political activity,  (ii) made any unlawful
      payment to foreign or domestic government officials or employees or to any
      foreign or domestic  political  parties or campaigns from corporate funds,
      (iii) failed to disclose  fully any  contribution  made by the Company (or
      made by any  person  acting on its  behalf of which the  Company is aware)
      which is in violation of law, or (iv) violated in any material respect any
      provision of the Foreign Corrupt Practices Act of 1977, as amended.


                                       14
<PAGE>


            (ff)  ACCOUNTANTS.  The  Company's  accountants  are  set  forth  on
      SCHEDULE 3.1(FF) of the Disclosure  Schedule.  To the Company's knowledge,
      such accountants,  who the Company expects will express their opinion with
      respect to the financial statements to be included in the Company's Annual
      Report on Form 10-K for the year ended December 31, 2003, are  independent
      accountants as required by the Securities Act.

            (gg) ACKNOWLEDGMENT  REGARDING  PURCHASERS'  PURCHASE OF SHARES. The
      Company  acknowledges  and agrees that it has been  advised by each of the
      Purchasers that each of the Purchasers is acting solely in the capacity of
      an arm's length  purchaser with respect to the  Transaction  Documents and
      the transactions  contemplated  hereby.  The Company further  acknowledges
      that it has been  advised by each of the  Purchasers  that no Purchaser is
      acting as a  financial  advisor or  fiduciary  of the  Company  (or in any
      similar  capacity)  with respect to this  Agreement  and the  transactions
      contemplated  hereby and any advice given by any Purchaser or any of their
      respective representatives or agents in connection with this Agreement and
      the  transactions   contemplated   hereby  is  merely  incidental  to  the
      Purchasers' purchase of the Shares. The Company further represents to each
      Purchaser  that the  Company's  decision to enter into this  Agreement has
      been  based  solely  on the  independent  evaluation  of the  transactions
      contemplated   hereby  by  the   Company  and  its   representatives   and
      representations by each of the Purchasers contained in this Agreement.

      3.2  REPRESENTATIONS  AND  WARRANTIES OF THE  PURCHASERS.  Each  Purchaser
hereby, for itself and for no other Purchaser, represents and warrants as of the
date hereof and as of the Closing Date to the Company as follows:

            (a)  ORGANIZATION;  AUTHORITY.  Such  Purchaser  is an  entity  duly
      organized,  validly  existing and in good  standing  under the laws of the
      jurisdiction of its organization with full right, corporate or partnership
      power and  authority  to enter  into and to  consummate  the  transactions
      contemplated by the  Transaction  Documents and otherwise to carry out its
      obligations  thereunder.  The execution,  delivery and performance by such
      Purchaser of the  transactions  contemplated  by this  Agreement have been
      duly  authorized by all necessary  corporate or similar action on the part
      of such Purchaser.  Each  Transaction  Document to which it is a party has
      been duly executed by such Purchaser, and when delivered by such Purchaser
      in accordance with the terms hereof, will constitute the valid and legally
      binding obligation of such Purchaser, enforceable against it in accordance
      with its terms, except (i) as limited by general equitable  principles and
      applicable bankruptcy,  insolvency,  reorganization,  moratorium and other
      laws of general  application  affecting  enforcement of creditors'  rights
      generally,  (ii)  as  limited  by laws  relating  to the  availability  of
      specific  performance,  injunctive relief or other equitable  remedies and
      (iii)  insofar  as  indemnification  and  contribution  provisions  may be
      limited by applicable law.


                                       15
<PAGE>


            (b)  INVESTMENT   INTENT.   Such  Purchaser   understands  that  the
      Securities are "restricted  securities" and have not been registered under
      the Securities Act or any applicable state securities law and is acquiring
      the  Securities as principal for its own account for  investment  purposes
      only  and  not  with  a view  to or for  distributing  or  reselling  such
      Securities or any part thereof,  has no present  intention of distributing
      any of such  Securities and has no arrangement or  understanding  with any
      other  persons   regarding  the  distribution  of  such  Securities  (this
      representation  and warranty not limiting such  Purchaser's  right to sell
      the  Securities  pursuant to the  Registration  Statement  or otherwise in
      compliance  with  applicable  federal  and state  securities  laws).  Such
      Purchaser is acquiring the Securities  hereunder in the ordinary course of
      its business. Such Purchaser does not have any agreement or understanding,
      directly  or  indirectly,  with  any  Person  to  distribute  any  of  the
      Securities.

            (c)  PURCHASER  STATUS.  At the time such  Purchaser was offered the
      Securities,  it was,  and at the date  hereof  it is,  and on each date on
      which it exercises any Warrants,  it will be an  "accredited  investor" as
      defined in Rule  501(a)(1),  (a)(2),  (a)(3),  (a)(7) or (a)(8)  under the
      Securities   Act  and  such  investors  has  total  assets  in  excess  of
      $5,000,000.  Such  Purchaser  is  not  required  to  be  registered  as  a
      broker-dealer under Section 15 of the Exchange Act.

            (d) EXPERIENCE OF SUCH PURCHASER.  Such  Purchaser,  either alone or
      together with its representatives,  has such knowledge, sophistication and
      experience  in  business  and  financial  matters  so as to be  capable of
      evaluating  the  merits  and risks of the  prospective  investment  in the
      Securities,  and has so evaluated the merits and risks of such investment.
      Such  Purchaser is able to bear the economic  risk of an investment in the
      Securities  and, at the present time, is able to afford a complete loss of
      such investment.

            (e) GENERAL  SOLICITATION.  Such  Purchaser  is not  purchasing  the
      Securities  as a result  of any  advertisement,  article,  notice or other
      communication   regarding  the  Securities  published  in  any  newspaper,
      magazine  or  similar  media  or  broadcast  over  television  or radio or
      presented  at any  seminar or any other  general  solicitation  or general
      advertisement.

            (f) REGISTRATION REQUIRED.  Such Purchaser hereby covenants with the
      Company  not to make any sale of the Shares  and  Warrant  Shares  without
      complying  with  the  provisions  hereof  and of the  Registration  Rights
      Agreement,   and  without  effectively  causing  the  prospectus  delivery
      requirement  under  the  Securities  Act  to  be  satisfied  (unless  such
      Purchaser is selling such Shares and Warrant  Shares in a transaction  not
      subject  to the  prospectus  delivery  requirement),  and  such  Purchaser
      acknowledges  that the  certificates  evidencing  the Shares  and  Warrant
      Shares will be  imprinted  with a legend  that  prohibits  their  transfer
      except in accordance therewith.


                                       16
<PAGE>


            (g) NO TAX OR LEGAL ADVICE. Such Purchaser  understands that nothing
      in this Agreement,  any other Transaction  Document or any other materials
      presented to such  Purchaser in  connection  with the purchase and sale of
      the Securities constitutes legal, tax or investment advice. Such Purchaser
      has consulted such legal,  tax and investment  advisors as it, in its sole
      discretion,  has deemed  necessary or appropriate  in connection  with its
      purchase of Securities.

            (h)  DISCLOSURE  OF  INFORMATION.  Such  Purchaser  believes  it has
      received all the  information it considers  necessary or  appropriate  for
      deciding  whether to  purchase  the Shares and  Warrants.  Such  Purchaser
      further  represents  that it has had an  opportunity  to ask questions and
      receive answers from the Company regarding the terms and conditions of the
      offering  of  the  Shares  and  Warrants  and  the  business,  properties,
      prospects  and  financial  condition of the Company.  Such  Purchaser  has
      reviewed the 2003 Form 10-K,  including,  without  limitation,  all of the
      Risk Factors set forth therein (the "RISK  FACTORS").  Each such Purchaser
      understands  and accepts all of the Risk Factors in  connection  with such
      Purchaser's investment in the Securities.  In addition, each Purchaser has
      reviewed  and is aware of the  information  set  forth in all SEC  Reports
      filed  with the SEC since  the  filing of the 2003  10-K.  The  foregoing,
      however,  does not limit or modify the  representations  and warranties of
      the Company in Section 3 of this  Agreement or the right of the Purchasers
      to rely thereon.

            (i) RECEIPT OF INFORMATION. The Purchasers confirm that, neither the
      Purchasers  nor any other Person  acting on their behalf has received from
      the Company or its agents or counsel with any information that constitutes
      or might  constitute  material,  non-public  information.  The  Purchasers
      understand  and  confirm  that  the  Company  will  rely on the  foregoing
      representations  and covenants in effecting  transactions in securities of
      the Purchasers.  The Purchasers acknowledge and agree that the Company has
      not  made  any   representations   or  warranties   with  respect  to  the
      transactions  contemplated  hereby other than those specifically set forth
      in the Transaction Documents.

            (j) RELIANCE OF SEC REPORTS.  In making the  investment  decision in
      connection with the purchase of the Securities, the Purchasers have relied
      only on the information set forth in the SEC Reports and have not incurred
      nor relied upon any information not contained in the SEC Reports.

            (k) OPEN SHORT POSITION. As of the date hereof, each Purchaser,  for
      itself only,  represents  and warrants  that neither it, nor any person or
      entity  acting at the  direction  of such  Purchaser,  holds an open short
      position in the Common Stock.

      The Company  acknowledges  and agrees that each Purchaser does not make or
has not made any  representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section 3.2.


                                       17
<PAGE>


                                  ARTICLE IV.
                         OTHER AGREEMENTS OF THE PARTIES

      4.1 TRANSFER RESTRICTIONS.

            (a) The Securities may only be disposed of in compliance  with state
      and federal securities laws. In connection with any transfer of Securities
      other than pursuant to an effective registration statement or Rule 144, to
      the Company or to an  Affiliate  of a Purchaser  or in  connection  with a
      pledge as contemplated  in Section 4.1(b)  (provided that such transfer is
      in  compliance  with the  Securities  Act),  the  Company  may require the
      transferor  thereof  to  provide  to the  Company  an  opinion  of counsel
      selected by the transferor and reasonably  acceptable to the Company,  the
      form and substance of which  opinion and shall be reasonably  satisfactory
      to the  Company,  to the  effect  that  such  transfer  does  not  require
      registration of such transferred Securities under the Securities Act. As a
      condition of transfer,  any such  transferee  shall agree in writing to be
      bound by the  terms of this  Agreement  and  shall  have the  rights  of a
      Purchaser under this Agreement and the Registration Rights Agreement.

            (b) The Purchasers  agree to the imprinting,  so long as is required
      by this  Section  4.1(b),  of a  legend  on any of the  Securities  in the
      following form:

            THESE  SECURITIES  HAVE NOT BEEN  REGISTERED WITH THE SECURITIES AND
            EXCHANGE  COMMISSION  OR THE  SECURITIES  COMMISSION OF ANY STATE IN
            RELIANCE UPON AN EXEMPTION  FROM  REGISTRATION  UNDER THE SECURITIES
            ACT OF 1933, AS AMENDED (THE "SECURITIES  ACT"),  AND,  ACCORDINGLY,
            MAY  NOT  BE  OFFERED  OR  SOLD  EXCEPT  PURSUANT  TO  AN  EFFECTIVE
            REGISTRATION  STATEMENT  UNDER THE  SECURITIES ACT OR PURSUANT TO AN
            AVAILABLE  EXEMPTION  FROM, OR IN A TRANSACTION  NOT SUBJECT TO, THE
            REGISTRATION  REQUIREMENTS  OF THE  SECURITIES ACT AND IN ACCORDANCE
            WITH  APPLICABLE  STATE  SECURITIES  LAWS  AS  EVIDENCED  BY A LEGAL
            OPINION OF COUNSEL TO THE  TRANSFEROR TO SUCH EFFECT,  THE SUBSTANCE
            OF WHICH  SHALL  BE  REASONABLY  ACCEPTABLE  TO THE  COMPANY.  THESE
            SECURITIES  MAY BE PLEDGED  IN  CONNECTION  WITH A BONA FIDE  MARGIN
            ACCOUNT  WITH  A  REGISTERED  BROKER-DEALER  OR  OTHER  LOAN  WITH A
            FINANCIAL INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN
            RULE 501(a) UNDER THE SECURITIES ACT.


                                       18
<PAGE>


            The Company  acknowledges  and agrees that a Purchaser may from time
      to time pledge pursuant to a bona fide margin  agreement with a registered
      broker-dealer  or  grant  a  security  interest  in  some  or  all  of the
      Securities to a financial  institution that is an "accredited investor" as
      defined in Rule 501(a) under the Securities Act and who agrees to be bound
      by the provisions of this Agreement and the Registration  Rights Agreement
      and, if required under the terms of such  arrangement,  such Purchaser may
      transfer pledged or secured Securities to the pledgees or secured parties.
      Such a pledge or transfer  would not be subject to approval of the Company
      and no legal  opinion of legal  counsel of the pledgee,  secured  party or
      pledgor  shall be required in  connection  therewith.  Further,  no notice
      shall be required of such pledge. At the appropriate  Purchaser's expense,
      the Company will execute and deliver such  reasonable  documentation  as a
      pledgee  or  secured  party  of  Securities  may  reasonably   request  in
      connection with a pledge or transfer of the Securities,  including, if the
      Securities are subject to registration pursuant to the Registration Rights
      Agreement,   the  preparation  and  filing  of  any  required   prospectus
      supplement  under  Rule  424(b)(3)  under  the  Securities  Act  or  other
      applicable provision of the Securities Act to appropriately amend the list
      of Selling Stockholders thereunder.

            (c) Certificates  evidencing the Shares and Warrant Shares shall not
      contain any legend (including the legend set forth in Section 4.1(b)), (i)
      while a  registration  statement  (including the  Registration  Statement)
      covering  the resale of such  security is effective  under the  Securities
      Act, or (ii) following any sale of such Shares or Warrant Shares  pursuant
      to Rule 144, or (iii) if such Shares or Warrant  Shares are  eligible  for
      sale under  Rule  144(k),  or (iv) if such  legend is not  required  under
      applicable   requirements  of  the  Securities  Act  (including   judicial
      interpretations and pronouncements issued by the Staff of the Commission).
      The  Company  shall  cause its  counsel  to issue a legal  opinion  to the
      Company's  transfer agent promptly after the Effective Date if required by
      the  Company's  transfer  agent  to  effect  the  removal  of  the  legend
      hereunder.  If all or any portion of a Warrant is exercised at a time when
      there is an  effective  registration  statement to cover the resale of the
      Warrant  Shares,  such Warrant Shares shall be issued free of all legends.
      The Company  agrees that  following the Effective  Date or at such time as
      such legend is no longer required under this Section  4.1(c),  it will, no
      later than seven (7) Trading Days following the delivery by a Purchaser to
      the Company or the Company's transfer agent of a certificate  representing
      Shares or Warrant  Shares,  as the case may be,  issued with a restrictive
      legend  (such date,  the "LEGEND  REMOVAL  DATE"),  deliver or cause to be
      delivered to such  Purchaser a certificate  representing  such  Securities
      that is free from all restrictive  and other legends.  The Company may not
      make any  notation on its  records or give  instructions  to any  transfer
      agent of the Company that enlarge the  restrictions  on transfer set forth
      in this Section.

            (d) In addition to such Purchaser's  other available  remedies,  the
      Company shall pay to a Purchaser,  in cash, as partial  liquidated damages
      and not as a penalty,  for each $1,000 of Shares or Warrant  Shares (based
      on the VWAP of the Common Stock on the date such  Securities are submitted
      to the  Company's  transfer  agent)  subject  to Section  4.1(c),  $10 per
      Trading Day (increasing to $20 per Trading Day five (5) Trading Days after
      such  damages  have begun to accrue) for each Trading Day after the Legend
      Removal Date until such  certificate  is delivered.  Nothing  herein shall
      limit such  Purchaser's  right to pursue actual  damages for the Company's
      failure to deliver certificates representing any Securities as required by
      the  Transaction  Documents,  and such  Purchaser  shall have the right to
      pursue all remedies available to it at law or in equity including, without
      limitation, a decree of specific performance and/or injunctive relief.


                                       19
<PAGE>


            (e)  Each  Purchaser,  severally  and not  jointly  with  the  other
      Purchasers,  agrees  that  the  removal  of the  restrictive  legend  from
      certificates  representing  Securities as set forth in this Section 4.1 is
      predicated upon the Company's reliance on each Purchaser's  representation
      that the  Purchaser  will  sell any  Securities  pursuant  to  either  the
      registration  requirements of the Securities Act, including any applicable
      prospectus delivery requirements, or an exemption therefrom.

            (f) Until the date that each  Purchaser  holds  less than 20% of the
      Shares initially purchased hereunder by such Purchaser,  the Company shall
      not undertake a reverse or forward stock split or  reclassification of the
      Common Stock without the prior written consent of the Purchasers holding a
      majority  in  interest  of  the  Shares.   Additionally,   each  Purchaser
      understands  and  acknowledges,  severally  and not jointly with the other
      Purchasers,  that the SEC  currently  takes the position  that coverage of
      short sales of shares of the Common  Stock  "against the box" prior to the
      Effective Date of the  Registration  Statement  with the Shares  purchased
      hereunder is a violation of Section 5 of the Securities  Act, as set forth
      in Item 65, Section 5 under Section A, of the Manual of Publicly Available
      Telephone  Interpretations,  dated  July 1997,  compiled  by the Office of
      Chief  Counsel,  Division  of  Corporation  Finance.   Accordingly,   each
      Purchaser  hereby  agrees  not to use any of the Shares to cover any short
      sales made prior to the Effective Date.

      4.2 FURNISHING OF INFORMATION.  As long as any Purchaser owns  Securities,
the Company  covenants to timely file (or obtain  extensions in respect  thereof
and file within the applicable grace period) all reports required to be filed by
the Company  after the date hereof  pursuant to the Exchange Act. As long as any
Purchaser  owns  Securities,  if the  Company is not  required  to file  reports
pursuant to the Exchange Act, it will prepare and furnish to the  Purchasers and
make publicly  available in accordance  with Rule 144(c) such  information as is
required for the Purchasers to sell the  Securities  under Rule 144. The Company
further  covenants  that it will  take  such  further  action  as any  holder of
Securities may reasonably request,  all to the extent required from time to time
to enable such Person to sell such  Securities  without  registration  under the
Securities Act within the limitation of the exemptions provided by Rule 144.

      4.3  INTEGRATION.  The Company  shall not sell,  offer for sale or solicit
offers to buy or  otherwise  negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the  Securities  in a manner that would  require the  registration  under the
Securities  Act of the sale of the Securities to the Purchasers or that would be
integrated  with the offer or sale of the  Securities  for purposes of the rules
and  regulations  of any Trading  Market such that it would require  shareholder
approval  prior to the  closing of such  other  transaction  unless  shareholder
approval is obtained before the closing of such subsequent transaction.


                                       20
<PAGE>


      4.4 SECURITIES LAWS DISCLOSURE; PUBLICITY. The Company shall, by 8:30 a.m.
Eastern time on the Trading Day following the date hereof, issue a press release
or file a Current Report on Form 8-K, in each case reasonably  acceptable to HPC
Capital  Management  ("HPC")  disclosing the material terms of the  transactions
contemplated  hereby.  The Company and each  Purchaser  shall  consult with each
other in issuing  any other  press  releases  with  respect to the  transactions
contemplated  hereby,  and neither the Company nor any Purchaser shall issue any
such press release or otherwise make any such public statement without the prior
consent of the Company,  with respect to any press release of any Purchaser,  or
without the prior consent of each  Purchaser,  with respect to any press release
of the Company, which consent shall not unreasonably be withheld, except if such
disclosure is required by law, in which case the disclosing party shall promptly
provide  the  other  party  with  prior  notice  of  such  public  statement  or
communication.  Notwithstanding  the  foregoing,  the Company shall not publicly
disclose the name of any Purchaser,  or include the name of any Purchaser in any
filing with the Commission or any regulatory  agency or Trading Market,  without
the prior written consent of such  Purchaser,  except (i) as required by federal
securities law in connection with the registration statement contemplated by the
Registration Rights Agreement and (ii) to the extent such disclosure is required
by law or Trading  Market  regulations,  in which case the Company shall provide
the Purchasers  with prior notice of such  disclosure  permitted under subclause
(i) or (ii).

      4.5  SHAREHOLDERS  RIGHTS  PLAN.  Assuming  that  none  of the  Purchasers
beneficially,  individually or as a "group" as described in Section  13(d)(3) of
the  Securities  Act,  owns more than 4.99% of the Common  Stock for purposes of
this  Section  4.5,  no claim will be made or enforced by the Company or, to the
knowledge of the Company,  any other Person that any  Purchaser is an "Acquiring
Person" under any  shareholders  rights plan or similar plan or  arrangement  in
effect or  hereafter  adopted by the  Company,  or that any  Purchaser  could be
deemed to trigger the provisions of any such plan or  arrangement,  by virtue of
receiving Securities under the Transaction Documents.  The Company shall conduct
its  business in a manner so that it will not become  subject to the  Investment
Company Act.

      4.6 NON-PUBLIC INFORMATION.  The Company covenants and agrees that neither
it nor any other Person  acting on its behalf will provide any  Purchaser or its
agents or counsel with any  information  that the Company  believes  constitutes
material non-public information,  unless prior thereto such Purchaser shall have
executed  a written  agreement  regarding  the  confidentiality  and use of such
information.  The Company  understands and confirms that each Purchaser shall be
relying on the foregoing representations in effecting transactions in securities
of the Company.

      4.7 USE OF PROCEEDS.  Except as set forth on SCHEDULE 4.7 attached hereto,
the Company shall use the net proceeds from the sale of the Securities hereunder
for working capital  purposes and not for the satisfaction of any portion of the
Company's debt  (including  payment of trade payables in the ordinary  course of
the Company's  business and prior  practices),  to redeem any Company  equity or
equity-equivalent securities or to settle any outstanding litigation.


                                       21
<PAGE>


      4.8 Intentionally Omitted.

      4.9  INDEMNIFICATION  OF  PURCHASERS.  Subject to the  provisions  of this
Section  4.9,  the Company  will  indemnify  and hold the  Purchasers  and their
directors,  officers,  shareholders,  partners,  employees and agents  (each,  a
"PURCHASER PARTY") harmless from any and all liabilities,  obligations,  claims,
contingencies,  damages,  costs and expenses,  including all judgments,  amounts
paid in  settlements,  court costs and reasonable  attorneys'  fees and costs of
investigation (excluding any lost profits,  incidental or consequential damages)
that any such Purchaser  Party may suffer or incur as a result of or relating to
(a)  any  breach  of  any  of  the  representations,  warranties,  covenants  or
agreements  made by the Company in this  Agreement  or in the other  Transaction
Documents or (b) any action  instituted  against a Purchaser,  or any of them or
their  respective  Affiliates,  by any  stockholder of the Company who is not an
Affiliate  of  such  Purchaser,   with  respect  to  any  of  the   transactions
contemplated  by the Transaction  Documents  (unless such action is based upon a
breach of such  Purchaser's  representation,  warranties or covenants  under the
Transaction  Documents or any  agreements or  understandings  such Purchaser may
have with any such  stockholder  or any  violations by the Purchaser of state or
federal  securities  laws or any  conduct by such  Purchaser  which  constitutes
fraud, gross negligence, willful misconduct or malfeasance). If any action shall
be brought  against any  Purchaser  Party in respect of which  indemnity  may be
sought  pursuant to this  Agreement,  such Purchaser Party shall promptly notify
the  Company  in  writing,  and the  Company  shall have the right to assume the
defense thereof with counsel of its own choosing. Any Purchaser Party shall have
the right to employ  separate  counsel in any such action and participate in the
defense  thereof,  but the fees and  expenses  of such  counsel  shall be at the
expense of such  Purchaser  Party  except to the extent that (i) the  employment
thereof has been  specifically  authorized  by the Company in writing,  (ii) the
Company has failed after a reasonable  period of time to assume such defense and
to employ counsel or (iii) in such action there is, in the reasonable opinion of
such separate  counsel,  a material  conflict on any material  issue between the
position of the Company and the position of such  Purchaser  Party.  The Company
will not be liable to any  Purchaser  Party  under  this  Agreement  (i) for any
settlement by an Purchaser  Party effected  without the Company's  prior written
consent,  which shall not be  unreasonably  withheld or delayed;  or (ii) to the
extent,  but only to the  extent  that a loss,  claim,  damage or  liability  is
attributable  to any  Purchaser  Party's  breach of any of the  representations,
warranties,  covenants or agreements made by the Purchasers in this Agreement or
in the other  Transaction  Documents.  A Purchaser Party shall have the right to
employ separate counsel in any such Proceeding and to participate in the defense
thereof,  but the fees and expenses of such  counsel  shall be at the expense of
such Purchaser  Party unless:  (1) the Company has agreed in writing to pay such
fees and  expenses;  (2) the Company  shall have  failed  promptly to assume the
defense of such Proceeding and to employ counsel reasonably satisfactory to such
Purchaser  Party in any such  Proceeding;  or (3) the named  parties to any such
Proceeding  (including any impleaded  parties) include both such Purchaser Party
and the Company, and such Purchaser Party shall reasonably believe, based on the
written  advice,  reasonably  acceptable  to the Company,  of its counsel that a
material  conflict of interest  is likely to exist if the same  counsel  were to
represent such Purchaser Party and the Company (in which case, if such Purchaser
Party notifies the Company in writing that it elects to employ separate  counsel
at the expense of the  Company,  the Company  shall not have the right to assume
the defense thereof and the reasonable fees and expenses of one separate counsel
for all Indemnified Parties shall be at the expense of the Company).


                                       22
<PAGE>


      4.10  RESERVATION OF COMMON STOCK. As of the date hereof,  the Company has
reserved  and the Company  shall  continue to reserve and keep  available at all
times, free of preemptive  rights, a sufficient number of shares of Common Stock
for the  purpose of  enabling  the  Company  to issue  Shares  pursuant  to this
Agreement and Warrant Shares pursuant to any exercise of the Warrants.

      4.11  LISTING  OF COMMON  STOCK.  The  Company  hereby  agrees to use best
efforts to maintain the listing of the Common Stock on a Trading Market,  and as
soon as  reasonably  practicable  following  the Closing (but not later than the
earlier of the Effective Date and the first  anniversary of the Closing Date) to
list all of the Shares and Warrant  Shares on such Trading  Market.  The Company
further  agrees,  if the Company  applies to have the Common Stock traded on any
other Trading Market,  it will include in such application all of the Shares and
Warrant Shares,  and will take such other action as is necessary to cause all of
the  Shares and  Warrant  Shares to be listed on such  other  Trading  Market as
promptly as possible.  The Company will take all action reasonably  necessary to
continue  the listing and  trading of its Common  Stock on a Trading  Market and
will  comply in all  respects  with the  Company's  reporting,  filing and other
obligations under the bylaws or rules of the Trading Market.

      4.12 EQUAL TREATMENT OF PURCHASERS.  No consideration  shall be offered or
paid to any  person  to amend or  consent  to a waiver  or  modification  of any
provision of any of the Transaction  Documents unless the same  consideration is
also  offered  to  all  of  the  parties  to  the  Transaction  Documents.   For
clarification  purposes,  this provision constitutes a separate right granted to
each Purchaser by the Company and negotiated  separately by each Purchaser,  and
is intended to treat for the Company the  Purchasers as a class and shall not in
any way be  construed  as the  Purchasers  acting in  concert or as a group with
respect to the purchase, disposition or voting of Securities or otherwise.

      4.13  PARTICIPATION  IN FUTURE  FINANCING.  From the date  hereof  until 6
months after the Effective Date, upon any financing by the Company of its Common
Stock or Common Stock  Equivalents  (a "SUBSEQUENT  FINANCING"),  each Purchaser
shall have the right to participate in up to 100% of such  Subsequent  Financing
(the "PARTICIPATION  MAXIMUM").  At least 5 Trading Days prior to the closing of
the Subsequent Financing,  the Company shall deliver to each Purchaser a written
notice of its intention to effect a Subsequent Financing  ("PRE-NOTICE"),  which
Pre-Notice  shall ask such  Purchaser  if it wants to review the details of such
financing (such additional notice, a "SUBSEQUENT  FINANCING  NOTICE").  Upon the
request  of a  Purchaser,  and only  upon a  request  by such  Purchaser,  for a
Subsequent  Financing  Notice,  the Company shall promptly,  but no later than 1
Trading Day after such request,  deliver a Subsequent  Financing  Notice to such
Purchaser.  The Subsequent  Financing Notice shall describe in reasonable detail
the proposed terms of such Subsequent Financing, the amount of proceeds intended
to be raised  thereunder,  the Person  with whom such  Subsequent  Financing  is
proposed to be effected,  and attached to which shall be a term sheet or similar
document  relating  thereto.  If by 6:30 p.m.  (New York City time) on the fifth
Trading  Day  after  all  of  the  Purchasers   have  received  the  Pre-Notice,
notifications  by the  Purchasers of their  willingness  to  participate  in the
Subsequent  Financing (or to cause their  designees to  participate)  is, in the
aggregate,  less than the total  amount of the  Subsequent  Financing,  then the
Company may effect the  remaining  portion of such  Subsequent  Financing on the
terms and to the Persons set forth in the Subsequent  Financing  Notice.  If the
Company  receives no notice from a Purchaser  as of such 5th Trading  Day,  such
Purchaser shall be deemed to have notified the Company that it does not elect to
participate.  The Company must provide the Purchasers  with a second  Subsequent
Financing Notice,  and the Purchasers will again have the right of participation
set forth above in this Section 4.13, if the Subsequent Financing subject to the
initial  Subsequent  Financing  Notice is not  consummated for any reason on the
terms set forth in such Subsequent Financing Notice within 60 Trading Days after
the date of the initial  Subsequent  Financing  Notice. In the event the Company
receives  responses to Subsequent  Financing Notices from Purchasers  seeking to
purchase more than the aggregate amount of the Subsequent  Financing,  each such
Purchaser  shall have the right to purchase  their Pro Rata  Portion (as defined
below) of the Participation  Maximum. "PRO RATA PORTION" is the ratio of (x) the
Subscription Amount of Securities purchased by a participating Purchaser and (y)
the sum of the aggregate  Subscription  Amount of all participating  Purchasers.
Notwithstanding  the foregoing,  this Section 4.13 shall not apply in respect of
an Exempt Issuance.


                                       23
<PAGE>


      4.14  SUBSEQUENT  EQUITY SALES.  From the date hereof until 3 months after
the Effective Date, neither the Company nor any Subsidiary shall issue shares of
Common Stock or Common Stock Equivalents;  PROVIDED, HOWEVER, the 3 month period
set forth in this  Section 4.14 shall be extended for the number of Trading Days
during such period in which (y) trading in the Common  Stock is suspended by any
Trading Market, or (z) following the Effective Date, the Registration  Statement
is not effective or the prospectus  included in the  Registration  Statement may
not be used by the Purchasers  for the resale of the Shares and Warrant  Shares.
Notwithstanding  the foregoing,  this Section 4.14 shall not apply in respect of
an Exempt  Issuance or issuances of Common Stock or Common Stock  Equivalents in
connection  with strategic  offerings or  acquisitions,  the primary  purpose of
which is not to raise capital.

      4.15 DELIVER OF SECURITIES  AFTER CLOSING.  The Company shall deliver,  or
cause to be  delivered,  the  respective  Shares and Warrants  purchased by each
Purchaser to such Purchaser within 5 Trading Days of the Closing Date.

                                   ARTICLE V.
                                  MISCELLANEOUS

      5.1 FEES AND EXPENSES.  Except as otherwise  set forth in this  Agreement,
each party shall pay the fees and expenses of its advisers, counsel, accountants
and  other  experts,  if any,  and all other  expenses  incurred  by such  party
incident to the negotiation, preparation, execution, delivery and performance of
this  Agreement.  The  Company  shall pay all stamp and other  taxes and  duties
levied in connection with the sale of the Securities, if any.


                                       24
<PAGE>


      5.2  ENTIRE  AGREEMENT.  The  Transaction  Documents,  together  with  the
exhibits and schedules thereto,  contain the entire understanding of the parties
with respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.

      5.3 NOTICES.  Any and all notices or other  communications  or  deliveries
required or permitted to be provided  hereunder shall be in writing and shall be
deemed given and effective on the earliest of (a) the date of  transmission,  if
such notice or  communication is delivered via facsimile at the facsimile number
set forth on the signature  pages  attached  hereto prior to 6:30 p.m. (New York
City  time)  on a  Trading  Day,  (b) the next  Trading  Day  after  the date of
transmission,  if such notice or communication is delivered via facsimile at the
facsimile  number set forth on the signature pages attached hereto on a day that
is not a Trading Day or later than 6:30 p.m. (New York City time) on any Trading
Day, (c) the second  Trading Day following the date of mailing,  if sent by U.S.
nationally  recognized  overnight courier service, or (d) upon actual receipt by
the party to whom such  notice is  required  to be given.  The  address for such
notices and communications shall be as set forth on the signature pages attached
hereto.

      5.4 AMENDMENTS;  WAIVERS.  No provision of this Agreement may be waived or
amended except in a written instrument  signed, in the case of an amendment,  by
the Company and each Purchaser or, in the case of a waiver, by the party against
whom  enforcement  of any such waiver is sought.  No waiver of any default  with
respect to any provision,  condition or  requirement of this Agreement  shall be
deemed to be a  continuing  waiver in the  future or a waiver of any  subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of either party to exercise  any right  hereunder in
any manner impair the exercise of any such right.

      5.5  CONSTRUCTION.  The headings herein are for  convenience  only, do not
constitute a part of this  Agreement  and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent,  and no
rules of strict construction will be applied against any party.

      5.6 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure
to the benefit of the parties and their  successors and permitted  assigns.  The
Company may not assign this  Agreement  or any rights or  obligations  hereunder
without the prior written  consent of each  Purchaser.  Any Purchaser may assign
any or all of its  rights  under  this  Agreement  to any  Person  to whom  such
Purchaser  assigns or transfers  any  Securities,  provided (a) such  transferee
agrees in writing to be bound,  with respect to the transferred  Securities,  by
the provisions  hereof that apply to the  "Purchasers,"  and (b) such transferee
provide the  representations  and  warranties,  as of the date of transfer,  set
forth in Section 3.2, and (c) such Purchaser  delivers to the Company an opinion
of counsel  reasonably  satisfactory  to the Company,  that such transfer is not
subject to, or made pursuant to an exemption from, the registration requirements
of the Securities Act and applicable state securities laws.


                                       25
<PAGE>


      5.7 NO  THIRD-PARTY  BENEFICIARIES.  This  Agreement  is intended  for the
benefit of the parties  hereto and their  respective  successors  and  permitted
assigns and is not for the benefit of, nor may any provision  hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.9.

      5.8 GOVERNING LAW. All questions  concerning the  construction,  validity,
enforcement and interpretation of the Transaction Documents shall be governed by
and construed and enforced in accordance  with the internal laws of the State of
New York,  without  regard to the  principles of conflicts of law thereof.  Each
party hereby irrevocably submits to the exclusive  jurisdiction of the state and
federal  courts  sitting in the City of New York,  borough of Manhattan  for the
adjudication  of any dispute  hereunder  or in  connection  herewith or with any
transaction  contemplated  hereby or discussed herein (including with respect to
the enforcement of any of the  Transaction  Documents),  and hereby  irrevocably
waives,  and agrees not to assert in any suit,  action or proceeding,  any claim
that it is not personally  subject to the  jurisdiction of any such court,  that
such suit,  action or  proceeding  is  improper or  inconvenient  venue for such
proceeding. Each party hereby irrevocably waives personal service of process and
consents  to process  being  served in any such suit,  action or  proceeding  by
mailing a copy thereof via  registered or certified  mail or overnight  delivery
(with  evidence of  delivery) to such party at the address in effect for notices
to it under this  Agreement and agrees that such service shall  constitute  good
and sufficient  service of process and notice thereof.  Nothing contained herein
shall be  deemed to limit in any way any right to serve  process  in any  manner
permitted  by law. The parties  hereby  waive all rights to a trial by jury.  If
either party shall commence an action or proceeding to enforce any provisions of
the  Transaction  Documents,  then  the  prevailing  party  in  such  action  or
proceeding  shall be reimbursed by the other party for its  attorneys'  fees and
other  costs and  expenses  incurred  with the  investigation,  preparation  and
prosecution of such action or proceeding.

      5.9 SURVIVAL.  The representations and warranties herein shall survive the
Closing and delivery of the Shares and Warrant Shares.

      5.10   EXECUTION.   This   Agreement  may  be  executed  in  two  or  more
counterparts,  all of which when taken  together shall be considered one and the
same agreement and shall become effective when  counterparts have been signed by
each party and  delivered  to the other  party,  it being  understood  that both
parties need not sign the same  counterpart.  In the event that any signature is
delivered by facsimile  transmission,  such  signature  shall create a valid and
binding  obligation of the party executing (or on whose behalf such signature is
executed)  with the same force and effect as if such  facsimile  signature  page
were an original thereof.

      5.11  SEVERABILITY.  If any  provision  of  this  Agreement  is held to be
invalid or unenforceable in any respect,  the validity and enforceability of the
remaining  terms  and  provisions  of  this  Agreement  shall  not in any way be
affected or impaired  thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor,  and upon so
agreeing, shall incorporate such substitute provision in this Agreement.


                                       26
<PAGE>


      5.12  RESCISSION AND  WITHDRAWAL  RIGHT.  Notwithstanding  anything to the
contrary  contained in (and  without  limiting  any similar  provisions  of) the
Transaction  Documents,  whenever  any  Purchaser  exercises a right,  election,
demand or option  under a  Transaction  Document and the Company does not timely
perform its related  obligations within the periods therein provided,  then such
Purchaser may rescind or withdraw, in its sole discretion from time to time upon
written notice to the Company, any relevant notice,  demand or election in whole
or in part without prejudice to its future actions and rights.

      5.13   REPLACEMENT  OF  SECURITIES.   If  any  certificate  or  instrument
evidencing any Securities is mutilated,  lost, stolen or destroyed,  the Company
shall  issue or cause to be issued in  exchange  and  substitution  for and upon
cancellation thereof, or in lieu of and substitution therefor, a new certificate
or instrument,  but only upon receipt of evidence reasonably satisfactory to the
Company  of such  loss,  theft  or  destruction  and  customary  and  reasonable
indemnity,  if requested.  The  applicants  for a new  certificate or instrument
under  such  circumstances  shall  also  pay any  reasonable  third-party  costs
associated with the issuance of such replacement Securities.

      5.14  REMEDIES.  In  addition to being  entitled  to  exercise  all rights
provided herein or granted by law,  including  recovery of damages,  each of the
Purchasers  and the Company will be entitled to specific  performance  under the
Transaction  Documents.  The  parties  agree that  monetary  damages  may not be
adequate  compensation  for  any  loss  incurred  by  reason  of any  breach  of
obligations  described in the  foregoing  sentence and hereby agrees to waive in
any action for specific  performance  of any such  obligation the defense that a
remedy at law would be adequate.

      5.15 PAYMENT SET ASIDE.  To the extent that the Company makes a payment or
payments to any Purchaser  pursuant to any  Transaction  Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the
proceeds of such  enforcement  or exercise or any part thereof are  subsequently
invalidated,  declared to be fraudulent or  preferential,  set aside,  recovered
from, disgorged by or are required to be refunded,  repaid or otherwise restored
to the  Company,  a  trustee,  receiver  or  any  other  person  under  any  law
(including, without limitation, any bankruptcy law, state or federal law, common
law or equitable  cause of action),  then to the extent of any such  restoration
the  obligation  or part thereof  originally  intended to be satisfied  shall be
revived and  continued  in full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.


                                       27
<PAGE>


      5.16  INDEPENDENT  NATURE  OF  PURCHASERS'  OBLIGATIONS  AND  RIGHTS.  The
obligations of each Purchaser under any Transaction Document are several and not
joint with the  obligations of any other  Purchaser,  and no Purchaser  shall be
responsible  in any way for the  performance  of the  obligations  of any  other
Purchaser under any Transaction  Document.  Nothing  contained  herein or in any
Transaction  Document,  and no action taken by any Purchaser  pursuant  thereto,
shall be deemed to constitute the Purchasers as a partnership, an association, a
joint  venture  or any other kind of entity,  or create a  presumption  that the
Purchasers  are in any way acting in concert or as a group with  respect to such
obligations or the transactions  contemplated by the Transaction Document.  Each
Purchaser  shall be  entitled to  independently  protect and enforce its rights,
including without limitation, the rights arising out of this Agreement or out of
the other  Transaction  Documents,  and it shall not be necessary  for any other
Purchaser  to be  joined  as an  additional  party  in any  proceeding  for such
purpose.  Each Purchaser has been  represented by its own separate legal counsel
in their review and  negotiation of the  Transaction  Documents.  For reasons of
administrative  convenience only,  Purchasers and their respective  counsel have
chosen to communicate  with the Company through FW. FW does not represent all of
the  Purchasers  but  only  HPC,  who  has  acted  as  placement  agent  to  the
transaction.  The Company has  elected to provide all  Purchasers  with the same
terms and  Transaction  Documents  for the  convenience  of the  Company and not
because it was required or requested to do so by the Purchasers.

      5.17  LIQUIDATED  DAMAGES.  The Company's  obligations  to pay any partial
liquidated  damages or other amounts owing under the Transaction  Documents is a
continuing  obligation of the Company and shall not  terminate  until all unpaid
partial liquidated damages and other amounts have been paid  notwithstanding the
fact that the instrument or security  pursuant to which such partial  liquidated
damages  or  other  amounts  are due  and  payable  shall  have  been  canceled.
Notwithstanding any provision herein or in the agreements  contemplated  hereby,
the  Company  shall not be subject  to  liquidated  damages  or other  penalties
arising from the Company's failure to timely deliver certificates or opinions of
counsel pursuant to this Agreement or the agreements contemplated hereby if such
failure  results from Force Majeure,  PROVIDED,  HOWEVER,  the Company shall use
best efforts to remedy or overcome such failures as promptly as possible.


                            (Signature Page Follows)



                                       28
<PAGE>


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

PERMA-FIX ENVIRONMENTAL SERVICES, INC.             ADDRESS FOR NOTICE:
                                                   ------------------

By: /S/ LOUIS CENTOFANTI
    ---------------------------
     Name: Louis Centofanti
     Title: Chairman of the Board
            Chief Executive Officer


With a copy to (which shall not constitute notice):


                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                     SIGNATURE PAGES FOR PURCHASERS FOLLOW]



                                       29
<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]

      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

ALEXANDRA GLOBAL MASTER FUND LTD.
By: ALEXANDRA INVESTMENT MANAGEMENT, LLC,
As Investment Advisor

By: /S/ M. FILIMONOV
    ---------------------------------
Name: Mikhail Filimonov
Title: Chairman and Chief Executive Officer

Address for Notice of Investing Entity:

c/o Alexandra Investment Management, LLC
767 Third Avenue, 39th Floor
New York, NY  10017

Subscription Amount:  $1,687,500
Shares:  750,000
Warrant Shares:  262,500
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]

      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: ALPHA CAPITAL AG
                          ---------------------------------
Signature of Authorized Signatory of Investing Entity: /S/ K. ACKERMAN
                                                       -------------------------
Name of Authorized Signatory: Konrad Ackerman
Title of Authorized Signatory:  Director
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:





Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount: $350,000
Shares:  155,556
Warrant Shares: 54,444
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: Baystar Capital II, L.P.
Signature of Authorized Signatory of Investing Entity: /s/ Steve Derby
Name of Authorized Signatory:  Steve Derby
Title of Authorized Signatory:  Managing Member
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:
c/o Baystar Capital Management, LLC
53 Forest Avenue, Suite 203
Old Greenwich, CT  06870


Address for Delivery of Securities for Investing Entity (if not same as above):




Subscription Amount: $405,000
Shares:  180,000
Warrant Shares: 63,000
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: Bristol Investment Fund, Ltd.
Signature of Authorized Signatory of Investing Entity: /s/ Paul Kessler
Name of Authorized Signatory:  Paul Kessler
Title of Authorized Signatory:  Director
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

Bristol Capital Advisors, LLC
6363 Sunset Boulevard, Fifth Floor
Hollywood, California  90028
Attention: Amy Wang, Esq.

Address for Delivery of Securities for Investing Entity (if not same as above):


Subscription Amount: $400,000
Shares: 177,778
Warrant Shares: 62,222
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: CRESCENT INTERNATIONAL LTD
Signature of Authorized Signatory
  of Investing Entity:                  /s/ Mel Craw            /s/ Maxi Brezzi
Name of Authorized Signatory:           Mel Craw               Maxi Brezzi
Title of Authorized Signatory:          Authorized Signatory
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

Crescent  International Ltd
C/o GreenLight (Switzerland) SA
84, av. Louis-Casai
CH 1216 COINTRIN, Geneva Switzerland

Address for Delivery of Securities for Investing Entity (if not same as above):

Crescent  International Ltd
C/o GreenLight (Switzerland) SA
84, av. Louis-Casai
CH 1216 COINTRIN, Geneva Switzerland

Subscription Amount: $675,000
Shares:  300,000
Warrant Shares: 105,000
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: Crestview Capital Master, LLC
Signature of Authorized Signatory of Investing Entity:  /s/ Stewart R. Flink
Name of Authorized Signatory:    Stewart R. Flink
Title of Authorized Signatory: Manager
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

95 Revere Drive, Suite A
Northbrook, Illinois  60062

Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount: $1,500,003
Shares: 666,668
Warrant Shares: 233,334
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]

<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: Geduld Capital Partners LP
Signature of Authorized Signatory of Investing Entity: /s/ Steven Geduld
Name of Authorized Signatory: Steven Geduld
Title of Authorized Signatory:  President
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

19495 Biscayne Blvd. Suite 608
Aventura, Fl.  33180

Address for Delivery of Securities for Investing Entity (if not same as above):

Grace Financial Group
350 Old Country Rd. Suite 102
Garden City, NY  11530

Subscription Amount: $168,750
Shares: 75,000
Warrant Shares: 26,250
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]

<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]

      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.


Name of Investing Entity: Gruber & McBaine International
Signature of Authorized Signatory of Investing Entity:  /s/ Jon D. Gruber
Name of Authorized Signatory: Gruber & McBaine Capital Mgmt
Title of Authorized Signatory: Investment Advisor
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

c/o Gruber & McBaine Capital Mgmt
50 Osgood Pl - PH
San Fransisco, CA  94133

Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount: $249,999.75
Shares: 111,111
Warrant Shares: 38,889
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.


Name of Investing Entity: Irwin Geduld Revocable Trust
Signature of Authorized Signatory of Investing Entity: /s/ Irwin Geduld
Name of Authorized Signatory: Irwin Geduld
Title of Authorized Signatory:
                              ---------------------------------
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

19495 Biscayne Blvd. Suite 608
Aventura, Fl.  33180

Address for Delivery of Securities for Investing Entity (if not same as above):

Grace Financial Group
350 Old Country Rd. Suite 102
Garden City, NY  11530

Subscription Amount: $112,500
Shares: 50,000
Warrant Shares: 17,500
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: J. Patterson McBaine
Signature of Authorized Signatory of Investing Entity: /s/ J. Patterson McBaine
Name of Authorized Signatory:
Title of Authorized Signatory:  Self
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

c/o Gruber & McBaine Capital Mgmt
50 Osgood Pl - PH
San Fransisco, CA  94133

Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount: $99,999
Shares: 44,444
Warrant Shares: 15,555
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.


Name of Investing Entity: Jon D. Gruber & Linda W. Gruber
Signature of Authorized Signatory
  of Investing Entity:                /s/ Jon D. Gruber    /s/ Linda W. Gruber
Name of Authorized Signatory:
Title of Authorized Signatory:  Self
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

c/o Gruber & McBaine Capital Mgmt
50 Osgood Pl - PH
San Fransisco, CA  94133

Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount: $249,999.75
Shares:  111,111
Warrant Shares:  38,889
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: Lagunitas Partners LP
Signature of Authorized Signatory of Investing Entity: /s/ Jon D. Gruber
Name of Authorized Signatory: Gruber & McBaine Capital Mgmt
Title of Authorized Signatory: General Partner
Email Address of Authorized Entity:
                                   ---------------------------------

Address for Notice of Investing Entity:

c/o Gruber & McBaine Capital Mgmt
50 Osgood Pl - PH
San Fransisco, CA  94133

Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount: $600,000.75
Shares:  266,667
Warrant Shares:  93,333
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

OMICRON MASTER TRUST
By: Omicron Capital L.P., as advisor
By: Omicron Capital Inc., its general partner

By: /S/ BRUCE BERNSTEIN
Name: Bruce Bernstein
Title:   Managing Partner

Address for Notice of Investing Entity:

Registered Office          Omicron Master Trust
                           c/o Winchester Global Trust Company
                           Williams House
                           20 Reid Street
                           Hamilton HM 11
                           Bermuda

Mailing Address:           Omicron Capital, L.P.
                           810 Seventh Avenue, 39th Flr
                           New York, NY  10019


Subscription Amount: $500,000
Shares: 222,222
Warrant Shares: 77,778
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: PALISADES MASTER FUND, L.P.
Signature of Authorized Signatory
  of Investing Entity: /s/ Palisades Master Fund, L.P.
Name of Authorized Signatory: Discovery Management Limited
Title of Authorized Signatory: Authorized Signatory
Email Address of Authorized Entity:
                                   ------------------------------------

Address for Notice of Investing Entity:

200 Mansell Court East
Ste 550
Roswell, Ga  30076
Attn: Paul T. Mannion, Jr.

Address for Delivery of Securities for Investing Entity (if not same as above):

Subscription Amount: $3,037,500
Shares: 1,350,000
Warrant Shares: 472,500
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


        [PURCHASER SIGNATURE PAGES TO PESI SECURITIES PURCHASE AGREEMENT]


      IN WITNESS WHEREOF,  the undersigned have caused this Securities  Purchase
Agreement to be duly executed by their respective  authorized  signatories as of
the date first indicated above.

Name of Investing Entity: Stonestreet LP
Signature of Authorized Signatory of Investing Entity: /s/ M. Finkelstein
Name of Authorized Signatory: Michael Finkelstein
Title of Authorized Signatory: President
Email Address of Authorized Entity:
                                   ------------------------------------

Address for Notice of Investing Entity:

260 Towne Centre Blvd
Suite 201
Markham, Ontario L3R8H8

Address for Delivery of Securities for Investing Entity (if not same as above):

c/o Canaccord Capital
320 Bay St. Suite 1300
Toronto, Ont. M5H4A6

Subscription Amount: $350,000
Shares: 155,556
Warrant Shares: 54,444
EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]


                           [SIGNATURE PAGES CONTINUE]

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.2
<SEQUENCE>3
<FILENAME>v02991_ex4-2.txt
<TEXT>


                                  EXHIBIT 4.2

                                                                       EXHIBIT A

                          REGISTRATION RIGHTS AGREEMENT

            This  Registration  Rights Agreement (this  "AGREEMENT") is made and
entered  into  as of  March  16,  2004,  by and  among  Perma-Fix  Environmental
Services,  Inc., a Delaware  corporation  (the  "COMPANY"),  and the  purchasers
signatory  hereto (each such  purchaser,  a "PURCHASER"  and  collectively,  the
"PURCHASERS").

            This  Agreement  is  made  pursuant  to  the   Securities   Purchase
Agreement, dated as of the date hereof among the Company and the Purchasers (the
"PURCHASE AGREEMENT").

            The Company and the Purchasers hereby agree as follows:

      1.  DEFINITIONS.  This Agreement  shall be subject to, and the capitalized
terms used and not  otherwise  defined  herein that are defined in the  Purchase
Agreement  shall have the meanings given such terms in, the Purchase  Agreement.
As used in  this  Agreement,  the  following  terms  shall  have  the  following
meanings:

            "ADVICE" shall have the meaning set forth in Section 6(d).

            "EFFECTIVENESS   DATE"  means,  with  respect  to  the  Registration
      Statement  required  to be filed  hereunder,  the earlier of (a) the 120th
      calendar day  following  the date of the Purchase  Agreement,  and (b) the
      seventh  (7th)  Trading  Day  following  the date on which the  Company is
      notified by the  Commission  that the  Registration  Statement will not be
      reviewed or is no longer subject to further review and comments.

            "EFFECTIVENESS  PERIOD"  shall have the meaning set forth in Section
      2(a).

            "EVENT" shall have the meaning set forth in Section 2(b).

            "EVENT DATE" shall have the meaning set forth in Section 2(b).

            "FILING  DATE"  means,  with respect to the  Registration  Statement
      required to be filed  hereunder,  the 45th calendar day following the date
      of the Purchase Agreement.

            "HOLDER" or "HOLDERS"  means the holder or holders,  as the case may
      be, from time to time of Registrable Securities.

            "INDEMNIFIED  PARTY"  shall  have the  meaning  set forth in Section
      5(c).

            "INDEMNIFYING  PARTY"  shall have the  meaning  set forth in Section
      5(c).

            "LOSSES" shall have the meaning set forth in Section 5(a).


                                      -1-
<PAGE>

            "PROCEEDING"  means  an  action,   claim,  suit,   investigation  or
      proceeding  (including,  without  limitation,  an investigation or partial
      proceeding, such as a deposition), whether commenced or threatened.

            "PROSPECTUS"  means  the  prospectus  included  in the  Registration
      Statement (including,  without limitation,  a prospectus that includes any
      information  previously  omitted  from a  prospectus  filed  as part of an
      effective  registration  statement in reliance upon Rule 430A  promulgated
      under the Securities  Act), as amended or  supplemented  by any prospectus
      supplement,  with  respect to the terms of the  offering of any portion of
      the Registrable Securities covered by the Registration Statement,  and all
      other   amendments   and   supplements   to  the   Prospectus,   including
      post-effective  amendments,  and all material incorporated by reference or
      deemed to be incorporated by reference in such Prospectus.

            "REGISTRABLE  SECURITIES"  means all of the Shares  and the  Warrant
      Shares,  together  with any shares of Common Stock issued or issuable upon
      any stock  split,  dividend  or other  distribution,  recapitalization  or
      similar event with respect to the foregoing.

            "REGISTRATION  STATEMENT" means the registration statements required
      to be filed hereunder, including (in each case) the Prospectus, amendments
      and  supplements to the  registration  statement or Prospectus,  including
      pre- and post-effective amendments, all exhibits thereto, and all material
      incorporated by reference or deemed to be incorporated by reference in the
      registration statement.

            "RULE 144(K)" means  paragraph  (k) of Rule 144  promulgated  by the
      Commission  pursuant  to the  Securities  Act, as such rule may be amended
      from time to time, or any similar rule or regulation  hereafter adopted by
      the Commission having substantially the same effect as such rule.

            "RULE 415" means Rule 415 promulgated by the Commission  pursuant to
      the Securities  Act, as such Rule may be amended from time to time, or any
      similar rule or  regulation  hereafter  adopted by the  Commission  having
      substantially the same purpose and effect as such Rule.

            "RULE 424" means Rule 424 promulgated by the Commission  pursuant to
      the Securities  Act, as such Rule may be amended from time to time, or any
      similar rule or  regulation  hereafter  adopted by the  Commission  having
      substantially the same purpose and effect as such Rule.

      2.    REGISTRATION.

            (a) On or prior to the Filing Date,  the Company  shall  prepare and
      file with the Commission the Registration Statement covering the resale of
      all  of the  Registrable  Securities  for  an  offering  to be  made  on a
      continuous basis pursuant to Rule 415. The Registration Statement required
      hereunder shall be on Form S-3 (except if the Company is not then eligible
      to register for resale the  Registrable  Securities  on Form S-3, in which
      case the Registration  shall be on another  appropriate form in accordance
      herewith).  The Registration  Statement  required  hereunder shall contain
      (except if otherwise  directed by the Holders)  substantially the "PLAN OF
      DISTRIBUTION"  attached  hereto as ANNEX A, as may be amended  pursuant to
      the comments from the Commission or as required under applicable rules and
      regulation  of the  Commission or the National  Association  of Securities
      Dealers,  Inc.  Subject to the terms of this Agreement,  the Company shall
      use its best  efforts to cause the  Registration  Statement to be declared
      effective  under the  Securities  Act as promptly  as  possible  after the
      filing thereof,  but in any event not later than the  Effectiveness  Date,
      and  shall  use its  best  efforts  to  keep  the  Registration  Statement
      continuously  effective  under the  Securities Act until the date when all
      Registrable  Securities  covered by the  Registration  Statement have been
      sold or may be sold without volume restrictions pursuant to Rule 144(k) as
      determined  by the  counsel to the Company  pursuant to a written  opinion
      letter to such effect,  addressed and acceptable to the Company's transfer
      agent and the affected Holders (the "EFFECTIVENESS PERIOD").


                                      -2-
<PAGE>

            (b) If: (i) a Registration Statement is not filed on or prior to the
      Filing  Date  (if the  Company  files  a  Registration  Statement  without
      affording the Holder the  opportunity to review and comment on the same as
      required  by  Section  3(a),  the  Company  shall  not be  deemed  to have
      satisfied  this clause  (i)),  or (ii) the Company  fails to file with the
      Commission  a  request  for  acceleration  in  accordance  with  Rule  461
      promulgated  under the  Securities  Act,  within seven Trading Days of the
      date that the Company is  notified  (orally or in  writing,  whichever  is
      earlier)  by the  Commission  that a  Registration  Statement  will not be
      "reviewed," or is not subject to further review,  or (iii)  [INTENTIONALLY
      OMITTED],  or (iv) a Registration  Statement filed or required to be filed
      hereunder is not declared  effective  by the  Commission  on or before the
      Effectiveness Date, or (v) if the Registrable  Securities are not eligible
      to be sold  pursuant to Rule  144(k),  after a  Registration  Statement is
      first declared  effective by the  Commission,  it ceases for any reason to
      remain continuously  effective as to all Registrable  Securities for which
      it is  required to be  effective,  or the  Holders  are not  permitted  to
      utilize the Prospectus therein to resell such Registrable Securities,  for
      in any  such  case  20  calendar  consecutive  days  but no  more  than an
      aggregate of 25 calendar  days during any 12 month period  (which need not
      be consecutive  Trading Days)(any such failure or breach being referred to
      as an  "EVENT,"  and for  purposes of clause (i) or (iv) the date on which
      such Event  occurs,  or for purposes of clause (ii) the date on which such
      five Trading Day period is  exceeded,  or for purposes of clause (iii) the
      date which such 20 calendar  days is  exceeded,  or for purposes of clause
      (v) the date on which such 20 or 25 calendar day period, as applicable, is
      exceeded being referred to as "EVENT DATE"), then in addition to any other
      rights the Holders may have hereunder or under applicable law: (x) on each
      such Event Date the Company shall pay to each Holder an amount in cash, as
      partial  liquidated  damages  and not as a  penalty,  equal to 1.0% of the
      aggregate  purchase  price paid by such Holder  pursuant  to the  Purchase
      Agreement for any Registrable Securities then held by such Holder; and (y)
      on each  monthly  anniversary  of each such Event Date (if the  applicable
      Event shall not have been cured by such date) until the  applicable  Event
      is  cured,  the  Company  shall pay to each  Holder an amount in cash,  as
      partial  liquidated  damages  and not as a  penalty,  equal to 1.5% of the
      aggregate  purchase  price paid by such Holder  pursuant  to the  Purchase
      Agreement for any Registrable  Securities then held by such Holder. If the
      Company  fails to pay any  partial  liquidated  damages  pursuant  to this
      Section in full within seven days after the date payable, the Company will
      pay  interest  thereon at a rate of 12% per annum (or such lesser  maximum
      amount  that is  permitted  to be paid by  applicable  law) to the Holder,
      accruing daily from the date such partial liquidated damages are due until
      such  amounts,  plus  all such  interest  thereon,  are paid in full.  The
      partial  liquidated  damages pursuant to the terms hereof shall apply on a
      daily  pro-rata  basis for any  portion of a month prior to the cure of an
      Event.


                                      -3-
<PAGE>

      3.    REGISTRATION PROCEDURES

            In connection with the Company's registration obligations hereunder,
the Company shall:

            (a) Not less  than  five  Trading  Days  prior to the  filing of the
      Registration  Statement  or any related  Prospectus  or any  amendment  or
      supplement  thereto,  the Company shall, (i) furnish to the Holders copies
      of  all  such  documents   proposed  to  be  filed  (including   documents
      incorporated or deemed  incorporated by reference to the extent  requested
      by such  Person)  which  documents  will be  subject to the review of such
      Holders,   and  (ii)  cause  its  officers  and  directors,   counsel  and
      independent  certified public  accountants to respond to such inquiries as
      shall be necessary,  in the  reasonable  opinion of respective  counsel to
      conduct a reasonable  investigation  within the meaning of the  Securities
      Act.  The Company  shall not file the  Registration  Statement or any such
      Prospectus or any amendments or  supplements  thereto to which the Holders
      of a majority of the Registrable  Securities  shall  reasonably  object in
      good faith,  provided  that the Company is notified of such  objection  in
      writing  no later  than 5  Trading  Days  after the  Holders  have been so
      furnished  copies of such  documents,  provided that such  objection  will
      extend the Filing  Date and the  Effectiveness  Date by the number of days
      from the date of such objection to the date such objection is withdrawn.

            (b) (i)  Prepare  and file  with  the  Commission  such  amendments,
      including post-effective amendments, to the Registration Statement and the
      Prospectus  used in  connection  therewith as may be necessary to keep the
      Registration   Statement  continuously  effective  as  to  the  applicable
      Registrable  Securities for the Effectiveness  Period and prepare and file
      with the Commission  such additional  Registration  Statements in order to
      register  for  resale  under  the  Securities  Act all of the  Registrable
      Securities;   (ii)  cause  the  related   Prospectus   to  be  amended  or
      supplemented by any required Prospectus supplement, and as so supplemented
      or amended to be filed  pursuant to Rule 424; (iii) respond as promptly as
      reasonably  possible to any comments  received  from the  Commission  with
      respect to the  Registration  Statement or any  amendment  thereto and, as
      promptly as reasonably  possible,  upon request,  provide the Holders true
      and  complete  copies  of all  correspondence  from and to the  Commission
      relating  to  the  Registration  Statement,  except  to  the  extent  such
      correspondence  may  contain  material  non-public  information;  and (iv)
      comply in all material  respects with the provisions of the Securities Act
      and the Exchange Act with respect to the  disposition  of all  Registrable
      Securities  covered by the  Registration  Statement  during the applicable
      period in  accordance  with the  intended  methods of  disposition  by the
      Holders thereof set forth in the  Registration  Statement as so amended or
      in such Prospectus as so supplemented.


                                      -4-
<PAGE>

            (c)  Notify  the  Holders of  Registrable  Securities  to be sold as
      promptly as  reasonably  possible  and (if  requested  by any such Person)
      confirm such notice in writing  promptly  following  the day (i)(A) when a
      Prospectus or any Prospectus supplement or post-effective amendment to the
      Registration  Statement is proposed to be filed;  (B) when the  Commission
      notifies the Company whether there will be a "review" of the  Registration
      Statement  and  whenever  the  Commission   comments  in  writing  on  the
      Registration  Statement  (the Company shall upon request  provide true and
      complete copies thereof and all written  responses  thereto to each of the
      Holders);  and (C)  with  respect  to the  Registration  Statement  or any
      post-effective  amendment, when the same has become effective; (ii) of any
      request  by the  Commission  or any other  Federal  or state  governmental
      authority during the period of effectiveness of the Registration Statement
      for amendments or supplements to the Registration  Statement or Prospectus
      or for additional information;  (iii) of the issuance by the Commission or
      any  other  federal  or state  governmental  authority  of any stop  order
      suspending the effectiveness of the Registration Statement covering any or
      all of the Registrable Securities or the initiation of any Proceedings for
      that purpose;  (iv) of the receipt by the Company of any notification with
      respect  to  the  suspension  of  the   qualification  or  exemption  from
      qualification  of  any of  the  Registrable  Securities  for  sale  in any
      jurisdiction,  or the initiation or threatening of any Proceeding for such
      purpose;  and (v) of the  occurrence  of any event or passage of time that
      makes the  financial  statements  included in the  Registration  Statement
      ineligible for inclusion therein or any statement made in the Registration
      Statement  or  Prospectus  or any  document  incorporated  or deemed to be
      incorporated  therein by reference  untrue in any material respect or that
      requires any revisions to the Registration Statement,  Prospectus or other
      documents  so  that,  in the  case of the  Registration  Statement  or the
      Prospectus,  as the case may be, it will not contain any untrue  statement
      of a  material  fact or omit to state any  material  fact  required  to be
      stated  therein or necessary to make the statements  therein,  in light of
      the circumstances under which they were made, not misleading.

            (d) Use  commercially  reasonable  efforts to avoid the issuance of,
      or, if  issued,  obtain the  withdrawal  of (i) any order  suspending  the
      effectiveness of the Registration Statement, or (ii) any suspension of the
      qualification (or exemption from  qualification) of any of the Registrable
      Securities  for  sale in any  jurisdiction,  at the  earliest  practicable
      moment.

            (e) Furnish to each Holder,  without charge,  at least one conformed
      copy of the Registration  Statement and each amendment thereto,  including
      financial statements and schedules,  all documents  incorporated or deemed
      to be  incorporated  therein by reference to the extent  requested by such
      Person, and all exhibits to the extent requested by such Person (including
      those  previously  furnished or incorporated by reference)  promptly after
      the filing of such documents with the Commission.

            (f) Promptly deliver to each Holder,  without charge, as many copies
      of the Prospectus or Prospectuses  (including each form of prospectus) and
      each  amendment  or  supplement  thereto as such  Persons  may  reasonably
      request  in  connection   with  resales  by  the  Holder  of   Registrable
      Securities.  Subject to the terms of this  Agreement,  the Company  hereby
      consents to the use of such  Prospectus  and each  amendment or supplement
      thereto by each of the selling Holders in connection with the offering and
      sale of the  Registrable  Securities  covered by such  Prospectus  and any
      amendment  or  supplement  thereto,  except after the giving on any notice
      pursuant to Section 3(c).


                                      -5-
<PAGE>

            (g) Prior to any resale of Registrable  Securities by a Holder,  use
      its  commercially  reasonable  efforts to register or qualify or cooperate
      with  the  selling  Holders  in  connection   with  the   registration  or
      qualification  (or exemption from the  Registration or  qualification)  of
      such  Registrable  Securities  for the  resale  by the  Holder  under  the
      securities or Blue Sky laws of such jurisdictions within the United States
      as any Holder reasonably  requests in writing, to keep the Registration or
      qualification (or exemption  therefrom) effective during the Effectiveness
      Period  (unless the transfer of such  Registrable  Securities are eligible
      for an exception from such  Registration or  qualification)  and to do any
      and  all  other  acts  or  things  reasonably   necessary  to  enable  the
      disposition in such jurisdictions of the Registrable Securities covered by
      the  Registration  Statement;  PROVIDED,  that the  Company  shall  not be
      required to qualify generally to do business in any jurisdiction  where it
      is not then so  qualified,  subject the Company to any material tax in any
      such  jurisdiction  where  it is not  then so  subject  or file a  general
      consent to service of process in any such jurisdiction.

            (h) If  requested  by the  Holders,  cooperate  with the  Holders to
      facilitate   the  timely   preparation   and   delivery  of   certificates
      representing  Registrable  Securities  to  be  delivered  to a  transferee
      pursuant to the Registration Statement,  which certificates shall be free,
      to the extent  permitted by the  Purchase  Agreement,  of all  restrictive
      legends,  and  to  enable  such  Registrable  Securities  to  be  in  such
      denominations  and  registered  in such  names  as any  such  Holders  may
      request.

            (i)  Upon  the  occurrence  of any  event  contemplated  by  Section
      3(c)(v),  as promptly as  reasonably  possible,  prepare a  supplement  or
      amendment,  including  a  post-effective  amendment,  to the  Registration
      Statement  or a  supplement  to the  related  Prospectus  or any  document
      incorporated or deemed to be incorporated  therein by reference,  and file
      any other required document so that, as thereafter delivered,  neither the
      Registration   Statement  nor  such  Prospectus  will  contain  an  untrue
      statement of a material  fact or omit to state a material fact required to
      be stated therein or necessary to make the statements therein, in light of
      the  circumstances  under  which they were made,  not  misleading.  If the
      Company  notifies the Holders in accordance  with clauses (ii) through (v)
      of  Section  3(c)  above to suspend  the use of any  Prospectus  until the
      requisite  changes to such  Prospectus  have been made,  then the  Holders
      shall  suspend  use of such  Prospectus.  The  Company  will  use its best
      efforts  to  ensure  that  the use of the  Prospectus  may be  resumed  as
      promptly as is practicable.  The Company shall be entitled to exercise its
      right  under  this  Section  3(i)  to  suspend  the   availability   of  a
      Registration   Statement  and  Prospectus,   subject  to  the  payment  of
      liquidated damages pursuant to Section 2(b), for a period not to exceed 60
      days (which need not be consecutive days) in any 12 month period.

            (j) Comply in all material  respects with all  applicable  rules and
      regulations of the Commission.


                                      -6-
<PAGE>

            (k) The Company may require  each  selling  Holder to furnish to the
      Company a certified  statement  as to the number of shares of Common Stock
      beneficially owned by such Holder and, if required by the Commission,  the
      person  thereof that has voting and  dispositive  control over the Shares.
      During any  periods  that the  Company  is unable to meet its  obligations
      hereunder with respect to the  registration of the Registrable  Securities
      solely because any Holder fails to furnish such  information  within three
      Trading Days of the Company's  request,  any  liquidated  damages that are
      accruing at such time as to such Holder only shall be tolled and any Event
      that may otherwise  occur solely  because of such delay shall be suspended
      as to such  Holder  only,  until  such  information  is  delivered  to the
      Company.  If the Company is unable to meet its obligations  hereunder with
      respect to the registration of the Registrable Securities held by a Holder
      solely because such Holder fails to furnish such information  prior to the
      later of 3 Trading Days of the Company's  request for such information and
      the Trading Day prior to the date the Registration Statement is filed, the
      Company  may  exclude  such  Holder's  Registrable   Securities  from  the
      Registration  Statement  provided if such information is later provided by
      the  Holder,  the Company  shall use  commercially  reasonable  efforts to
      register such Registrable Securities on the earliest possible date.

      4.  REGISTRATION   EXPENSES.   All  fees  and  expenses  incident  to  the
performance  of or compliance  with this Agreement by the Company shall be borne
by the Company  whether or not any  Registrable  Securities are sold pursuant to
the Registration  Statement.  The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including,  without  limitation,  fees and expenses (A) with respect to filings
required  to be made with the Trading  Market on which the Common  Stock is then
listed for trading,  and (B) in compliance with applicable  state  securities or
Blue Sky laws), (ii) printing expenses (including, without limitation,  expenses
of printing certificates for Registrable Securities and of printing prospectuses
if the  printing of  prospectuses  is  reasonably  requested by the holders of a
majority of the Registrable Securities included in the Registration  Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) Securities Act liability insurance,  if the Company
so desires  such  insurance,  and (vi) fees and  expenses  of all other  Persons
retained by the Company in connection with the  consummation of the transactions
contemplated  by this Agreement.  In addition,  the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation of
the transactions contemplated by this Agreement (including,  without limitation,
all salaries and expenses of its  officers  and  employees  performing  legal or
accounting  duties),  the expense of any annual  audit and the fees and expenses
incurred in  connection  with the listing of the  Registrable  Securities on any
securities  exchange  as  required  hereunder.  In no event shall the Company be
responsible  for any  broker or  similar  commissions  or,  except to the extent
specifically provided for in the Transaction Documents,  any legal fees or other
costs of the Holders.


                                      -7-
<PAGE>

      5.    INDEMNIFICATION

            (a)   INDEMNIFICATION   BY   THE   COMPANY.   The   Company   shall,
      notwithstanding  any  termination  of this  Agreement,  indemnify and hold
      harmless  each Holder,  the officers,  directors,  agents and employees of
      each of them, each Person who controls any such Holder (within the meaning
      of Section 15 of the Securities Act or Section 20 of the Exchange Act) and
      the officers,  directors,  agents and  employees of each such  controlling
      Person,  to the fullest  extent  permitted  by  applicable  law,  from and
      against  any  and  all  losses,  claims,   damages,   liabilities,   costs
      (including,  without limitation,  reasonable attorneys' fees) and expenses
      (collectively,  "LOSSES"), as incurred,  arising out of or relating to any
      untrue or alleged  untrue  statement of a material  fact  contained in the
      Registration Statement, any Prospectus or any form of prospectus or in any
      amendment  or  supplement  thereto or in any  preliminary  prospectus,  or
      arising  out of or  relating  to any  omission  or alleged  omission  of a
      material  fact  required  to be stated  therein or  necessary  to make the
      statements therein (in the case of any Prospectus or form of prospectus or
      supplement  thereto,  in light of the circumstances  under which they were
      made) not misleading,  except to the extent, but only to the extent,  that
      (i) such untrue  statements or omissions are based solely upon information
      regarding  such Holder  furnished in writing to the Company by such Holder
      expressly for use therein,  or to the extent that such information relates
      to such  Holder  or such  Holder's  proposed  method  of  distribution  of
      Registrable  Securities and was reviewed and expressly approved in writing
      by such  Holder  expressly  for use in the  Registration  Statement,  such
      Prospectus  or such form of  Prospectus  or in any amendment or supplement
      thereto (it being  understood  that the Holder has approved Annex A hereto
      for this  purpose) or (ii) in the case of an occurrence of an event of the
      type  specified  in  Section  3(c)(ii)-(v),  the use by such  Holder of an
      outdated or  defective  Prospectus  after the Company  has  notified  such
      Holder in writing that the  Prospectus  is outdated or defective and prior
      to the receipt by such Holder of the Advice  contemplated in Section 6(d).
      The Company shall notify the Holders promptly of the  institution,  threat
      or assertion of any Proceeding of which the Company is aware in connection
      with the transactions contemplated by this Agreement.

            (b) INDEMNIFICATION BY HOLDERS. Each Holder shall, severally and not
      jointly, indemnify and hold harmless the Company, its directors, officers,
      agents and  employees,  each Person who controls  the Company  (within the
      meaning of Section 15 of the Securities Act and Section 20 of the Exchange
      Act), and the directors, officers, agents or employees of such controlling
      Persons,  to the fullest  extent  permitted by  applicable  law,  from and
      against all Losses,  as  incurred,  to the extent  arising out of or based
      solely  upon:  (x) such  Holder's  failure to comply  with the  prospectus
      delivery  requirements  of the Securities Act or (y) any untrue or alleged
      untrue  statement  of  a  material  fact  contained  in  any  Registration
      Statement, any Prospectus,  or any form of prospectus, or in any amendment
      or supplement thereto or in any preliminary prospectus,  or arising out of
      or  relating  to any  omission  or alleged  omission  of a  material  fact
      required to be stated therein or necessary to make the statements  therein
      not misleading (i) to the extent, but only to the extent, that such untrue
      statement  or omission is  contained  in any  information  so furnished in
      writing by such Holder to the Company  specifically  for  inclusion in the
      Registration  Statement or such  Prospectus or (ii) to the extent that (1)
      such untrue  statements  or omissions  are based  solely upon  information
      regarding  such Holder  furnished in writing to the Company by such Holder
      expressly for use therein,  or to the extent that such information relates
      to such  Holder  or such  Holder's  proposed  method  of  distribution  of
      Registrable  Securities and was reviewed and expressly approved in writing
      by such Holder expressly for use in the  Registration  Statement (it being
      understood  that the Holder has approved Annex A hereto for this purpose),
      such  Prospectus  or  such  form  of  Prospectus  or in any  amendment  or
      supplement  thereto or (2) in the case of an occurrence of an event of the
      type  specified  in  Section  3(c)(ii)-(v),  the use by such  Holder of an
      outdated or  defective  Prospectus  after the Company  has  notified  such
      Holder in writing that the  Prospectus  is outdated or defective and prior
      to the receipt by such Holder of the Advice  contemplated in Section 6(d).
      In no event shall the liability of any selling Holder hereunder be greater
      in amount  than the dollar  amount of the net  proceeds  received  by such
      Holder  upon the sale of the  Registrable  Securities  giving rise to such
      indemnification obligation.


                                      -8-
<PAGE>

            (c) CONDUCT OF INDEMNIFICATION  PROCEEDINGS. If any Proceeding shall
      be brought or asserted against any Person entitled to indemnity  hereunder
      (an "INDEMNIFIED PARTY"), such Indemnified Party shall promptly notify the
      Person  from  whom  indemnity  is sought  (the  "INDEMNIFYING  PARTY")  in
      writing,  and the  Indemnifying  Party  shall have the right to assume the
      defense   thereof,   including  the   employment  of  counsel   reasonably
      satisfactory  to the  Indemnified  Party and the  payment  of all fees and
      expenses incurred in connection with defense thereof;  provided,  that the
      failure of any Indemnified Party to give such notice shall not relieve the
      Indemnifying  Party of its  obligations  or  liabilities  pursuant to this
      Agreement,  except  (and  only) to the  extent  that it  shall be  finally
      determined by a court of competent  jurisdiction  (which  determination is
      not  subject to appeal or further  review)  that such  failure  shall have
      prejudiced the Indemnifying Party.

            An Indemnified Party shall have the right to employ separate counsel
      in any such Proceeding and to participate in the defense thereof,  but the
      fees  and  expenses  of  such  counsel  shall  be at the  expense  of such
      Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed
      in writing to pay such fees and expenses; (2) the Indemnifying Party shall
      have  failed  promptly  to assume the  defense of such  Proceeding  and to
      employ counsel  reasonably  satisfactory to such Indemnified  Party in any
      such  Proceeding;  or  (3)  the  named  parties  to  any  such  Proceeding
      (including any impleaded  parties) include both such Indemnified Party and
      the  Indemnifying  Party,  and such  Indemnified  Party  shall  reasonably
      believe,  based  on  the  written  advice,  reasonably  acceptable  to the
      Company,  of their counsel that a material  conflict of interest is likely
      to exist if the same counsel were to represent such Indemnified  Party and
      the Indemnifying  Party (in which case, if such Indemnified Party notifies
      the  Indemnifying  Party in  writing  that it elects  to  employ  separate
      counsel at the expense of the Indemnifying  Party, the Indemnifying  Party
      shall not have the right to assume the defense  thereof and the reasonable
      fees and  expenses of one  separate  counsel for all  Indemnified  Parties
      shall be at the expense of the Indemnifying Party). The Indemnifying Party
      shall not be liable for any  settlement  of any such  Proceeding  effected
      without its  written  consent,  which  consent  shall not be  unreasonably
      withheld.  No Indemnifying Party shall,  without the prior written consent
      of the Indemnified Party,  effect any settlement of any pending Proceeding
      in  respect  of  which  any  Indemnified  Party is a  party,  unless  such
      settlement  includes an unconditional  release of such  Indemnified  Party
      from  all  liability  on  claims  that  are  the  subject  matter  of such
      Proceeding.

            Subject  to the terms of this  Agreement,  all  reasonable  fees and
      expenses of the Indemnified Party (including  reasonable fees and expenses
      to the extent  incurred in connection with  investigating  or preparing to
      defend such  Proceeding  in a manner not  inconsistent  with this Section)
      shall be paid to the Indemnified  Party,  as incurred,  within ten Trading
      Days of written notice thereof to the Indemnifying Party;  PROVIDED,  that
      the Indemnified Party shall promptly  reimburse the Indemnifying Party for
      that  portion of such fees and  expenses  applicable  to such  actions for
      which such Indemnified Party is not entitled to indemnification hereunder,
      determined based upon the relative faults of the parties.


                                      -9-
<PAGE>

            (d) CONTRIBUTION.  If a claim for indemnification under Section 5(a)
      or 5(b) is unavailable to an Indemnified Party (by reason of public policy
      or otherwise),  then each Indemnifying Party, in lieu of indemnifying such
      Indemnified  Party, shall contribute to the amount paid or payable by such
      Indemnified  Party as a result of such Losses,  in such  proportion  as is
      appropriate  to reflect the relative fault of the  Indemnifying  Party and
      Indemnified Party in connection with the actions,  statements or omissions
      that  resulted  in such  Losses  as well as any other  relevant  equitable
      considerations.   The  relative  fault  of  such  Indemnifying  Party  and
      Indemnified Party shall be determined by reference to, among other things,
      whether any action in  question,  including  any untrue or alleged  untrue
      statement of a material fact or omission or alleged omission of a material
      fact,  has been taken or made by, or relates to  information  supplied by,
      such  Indemnifying  Party or Indemnified  Party, and the parties' relative
      intent,  knowledge,  access to information  and  opportunity to correct or
      prevent such action,  statement or omission. The amount paid or payable by
      a party as a result of any Losses  shall be deemed to include,  subject to
      the limitations set forth in this Agreement,  any reasonable attorneys' or
      other  reasonable  fees or expenses  incurred by such party in  connection
      with any  Proceeding to the extent such party would have been  indemnified
      for such fees or  expenses  if the  indemnification  provided  for in this
      Section was available to such party in accordance with its terms.

            The parties  hereto agree that it would not be just and equitable if
      contribution  pursuant to this  Section 5(d) were  determined  by pro rata
      allocation  or by any other method of  allocation  that does not take into
      account  the  equitable  considerations  referred  to in  the  immediately
      preceding paragraph.  Notwithstanding the provisions of this Section 5(d),
      no Holder shall be required to contribute, in the aggregate, any amount in
      excess of the  amount  by which the  proceeds  actually  received  by such
      Holder  from  the  sale  of  the  Registrable  Securities  subject  to the
      Proceeding  exceeds  the  amount  of any  damages  that  such  Holder  has
      otherwise  been required to pay by reason of such untrue or alleged untrue
      statement or omission or alleged omission,  except in the case of fraud by
      such Holder.

            The indemnity and contribution  agreements contained in this Section
      are in addition to any liability that the Indemnifying Parties may have to
      the Indemnified Parties.

      6.    MISCELLANEOUS

            (a)  REMEDIES.  In the  event of a  breach  by the  Company  or by a
      Holder, of any of their  obligations under this Agreement,  each Holder or
      the Company, as the case may be, in addition to being entitled to exercise
      all rights granted by law and under this Agreement,  including recovery of
      damages, will be entitled to specific performance of its rights under this
      Agreement.  The Company and each Holder agree that monetary  damages would
      not provide  adequate  compensation for any losses incurred by reason of a
      breach by it of any of the provisions of this Agreement and hereby further
      agrees  that,  in the event of any  action  for  specific  performance  in
      respect of such  breach,  it shall waive the defense  that a remedy at law
      would be adequate.


                                      -10-
<PAGE>

            (b) NO PIGGYBACK ON  REGISTRATIONS.  Except as set forth on SCHEDULE
      6(B) attached hereto,  neither the Company nor any of its security holders
      (other  than the  Holders in such  capacity  pursuant  hereto) may include
      securities  of the  Company  in a  Registration  Statement  other than the
      Registrable Securities.  Subject to SCHEDULE 6(B), no Person has any right
      to cause the Company to effect the  registration  under the Securities Act
      of any  securities of the Company.  Subject to SCHEDULE  6(B), the Company
      shall not file any other registration  statement until after the Effective
      Date.

            (c) COMPLIANCE. Each Holder covenants and agrees that it will comply
      with  the  prospectus  delivery  requirements  of  the  Securities  Act as
      applicable  to it in  connection  with  sales  of  Registrable  Securities
      pursuant to the Registration Statement.

            (d) DISCONTINUED DISPOSITION.  Each Holder agrees by its acquisition
      of such  Registrable  Securities  that,  upon receipt of a notice from the
      Company of the  occurrence  of any event of the kind  described in Section
      3(c),  such  Holder  will  forthwith   discontinue   disposition  of  such
      Registrable   Securities  under  the  Registration  Statement  until  such
      Holder's  receipt  of the  copies of the  supplemented  Prospectus  and/or
      amended  Registration  Statement  or until it is advised  in writing  (the
      "ADVICE") by the Company that the use of the applicable  Prospectus may be
      resumed,  and, in either case,  has received  copies of any  additional or
      supplemental filings that are incorporated or deemed to be incorporated by
      reference in such Prospectus or Registration  Statement.  The Company will
      use its best  efforts  to  ensure  that the use of the  Prospectus  may be
      resumed as promptly as it practicable. The Company agrees and acknowledges
      that any periods  during which the Holder is required to  discontinue  the
      disposition of the  Registrable  Securities  hereunder shall be subject to
      the provisions of Section 2(b).

            (e)   PIGGY-BACK   REGISTRATIONS.   If  at  any  time   during   the
      Effectiveness  Period  there is not an  effective  Registration  Statement
      covering all of the Registrable Securities and the Company shall determine
      to prepare and file with the Commission a registration  statement relating
      to an  offering  for its own  account or the  account of others  under the
      Securities Act of any of its equity securities,  other than on Form S-4 or
      Form S-8 (each as  promulgated  under the  Securities  Act) or their  then
      equivalents   relating  to  equity  securities  to  be  issued  solely  in
      connection  with any  acquisition  of any  entity  or  business  or equity
      securities  issuable in connection with the stock option or other employee
      benefit plans, then the Company shall send to each Holder a written notice
      of such  determination  and, if within fifteen days after the date of such
      notice,  any such Holder  shall so request in writing,  the Company  shall
      include in such registration statement all or any part of such Registrable
      Securities as such Holder requests to be registered,  subject to customary
      underwriter  cutbacks  applicable to all holders of  registration  rights,
      which will provide that upon a cut-back of the  securities  to be included
      in such  registration  statement,  the  securities  held by all holders of
      registration  rights will be cut-back  before any securities to be sold by
      the Company are cut-back.


                                      -11-
<PAGE>

            (f)  AMENDMENTS  AND  WAIVERS.  The  provisions  of this  Agreement,
      including the provisions of this sentence, may not be amended, modified or
      supplemented,  and waivers or consents to departures  from the  provisions
      hereof may not be given, unless the same shall be in writing and signed by
      the  Company  and  each  Holder  of  the  then   outstanding   Registrable
      Securities.

            (g)  NOTICES.  Any  and  all  notices  or  other  communications  or
      deliveries required or permitted to be provided hereunder shall be made in
      accordance with the provisions of the Purchase Agreement.

            (h)  SUCCESSORS  AND  ASSIGNS.  This  Agreement  shall  inure to the
      benefit of and be binding upon the  successors  and  permitted  assigns of
      each of the parties and shall  inure to the benefit of each  Holder.  Each
      Holder may assign their  respective  rights hereunder in the manner and to
      the Persons as permitted under the Purchase Agreement.

            (i) EXECUTION AND  COUNTERPARTS.  This  Agreement may be executed in
      any number of counterparts, each of which when so executed shall be deemed
      to be an original and, all of which taken  together  shall  constitute one
      and the same  Agreement.  In the event that any  signature is delivered by
      facsimile  transmission,  such  signature  shall  create  a valid  binding
      obligation of the party  executing  (or on whose behalf such  signature is
      executed)  the same with the same  force and  effect as if such  facsimile
      signature were the original thereof.

            (j)  GOVERNING  LAW.  All  questions  concerning  the  construction,
      validity,  enforcement  and  interpretation  of this  Agreement  shall  be
      determined with the provisions of the Purchase Agreement.

            (k) CUMULATIVE REMEDIES. The remedies provided herein are cumulative
      and not exclusive of any remedies provided by law.

            (l) SEVERABILITY. If any term, provision, covenant or restriction of
      this Agreement is held by a court of competent jurisdiction to be invalid,
      illegal,  void or unenforceable,  the remainder of the terms,  provisions,
      covenants and restrictions set forth herein shall remain in full force and
      effect and shall in no way be affected,  impaired or invalidated,  and the
      parties hereto shall use their commercially reasonable efforts to find and
      employ an alternative  means to achieve the same or substantially the same
      result  as  that  contemplated  by  such  term,  provision,   covenant  or
      restriction.  It is hereby  stipulated and declared to be the intention of
      the parties that they would have executed the remaining terms, provisions,
      covenants  and  restrictions  without  including  any of such  that may be
      hereafter declared invalid, illegal, void or unenforceable.

            (m) HEADINGS.  The headings in this Agreement are for convenience of
      reference only and shall not limit or otherwise affect the meaning hereof.


                                      -12-
<PAGE>

            (n) INDEPENDENT  NATURE OF PURCHASERS'  OBLIGATIONS AND RIGHTS.  The
      obligations  of each Holder  hereunder  are several and not joint with the
      obligations  of any  other  Holder  hereunder,  and  no  Holder  shall  be
      responsible in any way for the performance of the obligations of any other
      Holder  hereunder.  Nothing  contained herein or in any other agreement or
      document  delivered  at any  closing,  and no action  taken by any  Holder
      pursuant hereto or thereto, shall be deemed to constitute the Holders as a
      partnership,  an association, a joint venture or any other kind of entity,
      or create a presumption  that the Holders are in any way acting in concert
      with respect to such obligations or the transactions  contemplated by this
      Agreement.  Each  Holder  shall be  entitled  to protect  and  enforce its
      rights,  including  without  limitation  the  rights  arising  out of this
      Agreement, and it shall not be necessary for any other Holder to be joined
      as an additional party in any proceeding for such purpose.


                            *************************


                                      -13-
<PAGE>

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


                                PERMA-FIX ENVIRONMENTAL SERVICES, INC.

                                By: /S/ LOUIS CENTOFANTI
                                    ----------------------------
                                    Name: Louis Centofanti
                                    Title: Chairman of the Board
                                           Chief Executive Officer


                       [SIGNATURE PAGE OF HOLDERS FOLLOWS]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]


ALEXANDRA GLOBAL MASTER FUND LTD.
By: ALEXANDRA INVESTMENT MANAGEMENT, LLC,
As Investment Advisor

By: /S/ M. FILIMONOV
    --------------------------------
Name: Mikhail Filimonov
Title: Chairman and Chief Executive Officer


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: ALPHA CAPITAL AG
                          --------------------------------
Signature of Authorized Signatory of Investing Entity: /S/ K. ACKERMAN
                                                      -------------------------
Name of Authorized Signatory: Konrad Ackerman
Title of Authorized Signatory:  Director


                           [SIGNATURE PAGES CONTINUE]

<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: Baystar Capital II, L.P.
Signature of Authorized Signatory of Investing Entity: /s/ Steve Derby
Name of Authorized Signatory:  Steve Derby
Title of Authorized Signatory:  Managing Member


                           [SIGNATURE PAGES CONTINUE]

<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: Bristol Investment Fund, Ltd.
Signature of Authorized Signatory of Investing Entity: /s/ Paul Kessler
Name of Authorized Signatory:  Paul Kessler
Title of Authorized Signatory:  Director


                           [SIGNATURE PAGES CONTINUE]

<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]


Name of Investing Entity: CRESCENT INTERNATIONAL LTD
Signature of Authorized Signatory
  of Investing Entity:                  /s/ Mel Craw    /s/ Maxi Brezzi
Name of Authorized Signatory:           Mel Craw        Maxi Brezzi
Title of Authorized Signatory:          Authorized Signatory



                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]


Name of Investing Entity: Crestview Capital Master, LLC
Signature of Authorized Signatory of Investing Entity:  /s/ Stewart R. Flink
Name of Authorized Signatory:    Stewart R. Flink
Title of Authorized Signatory: Manager


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: Geduld Capital Partners LP
Signature of Authorized Signatory of Investing Entity: /s/ Steven Geduld
Name of Authorized Signatory: Steven Geduld
Title of Authorized Signatory:  President


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]


Name of Investing Entity: Gruber & McBaine International
Signature of Authorized Signatory of Investing Entity:  /s/ Jon D. Gruber
Name of Authorized Signatory: Gruber & McBaine Capital Mgmt
Title of Authorized Signatory: Investment Advisor


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]


Name of Investing Entity: Irwin Geduld Revocable Trust
Signature of Authorized Signatory of Investing Entity: /s/ Irwin Geduld
Name of Authorized Signatory: Irwin Geduld
Title of Authorized Signatory: Trustee


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]


Name of Investing Entity: J. Patterson McBaine
Signature of Authorized Signatory of Investing Entity: /s/ J. Patterson McBaine
Name of Authorized Signatory:
Title of Authorized Signatory:  Self


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: Jon D. Gruber & Linda W. Gruber
Signature of Authorized Signatory
  of Investing Entity:          /s/ Jon D. Gruber    /s/ Linda W. Gruber
Name of Authorized Signatory:
Title of Authorized Signatory:  Self


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: Lagunitas Partners LP
Signature of Authorized Signatory of Investing Entity: /s/ Jon D. Gruber
Name of Authorized Signatory: Gruber & McBaine Capital Mgmt
Title of Authorized Signatory: General Partner


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]



OMICRON MASTER TRUST
By: Omicron Capital L.P., as advisor
By: Omicron Capital Inc., its general partner

By: /S/ BRUCE BERNSTEIN
    --------------------------------
Name: Bruce Bernstein
Title:   Managing Partner


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: PALISADES MASTER FUND, L.P.
Signature of Authorized Signatory
  of Investing Entity: /s/ Palisades Master Fund, L.P.
Name of Authorized Signatory: Discovery Management Limited
Title of Authorized Signatory: Authorized Signatory


                           [SIGNATURE PAGES CONTINUE]


<PAGE>


                    [PURCHASER'S SIGNATURE PAGE TO PESI RRA]

Name of Investing Entity: Stonestreet LP

Signature of Authorized Signatory of Investing Entity: /s/ M. Finkelstein
Name of Authorized Signatory: Michael Finkelstein
Title of Authorized Signatory: President



                           [SIGNATURE PAGES CONTINUE]

<PAGE>


                                     ANNEX A

                              PLAN OF DISTRIBUTION

      The Selling Stockholders (the "SELLING  STOCKHOLDERS") of the common stock
("COMMON STOCK") of Perma-Fix  Environmental  Services, Inc. (the "COMPANY") and
any of their pledgees,  assignees and  successors-in-interest  may, from time to
time,  sell any or all of their  shares of Common  Stock on any stock  exchange,
market  or  trading  facility  on which the  shares  are  traded  or in  private
transactions.  These  sales may be at fixed or  negotiated  prices.  The Selling
Stockholders  may use any one or more  of the  following  methods  when  selling
shares:

      o     ordinary  brokerage  transactions  and  transactions  in  which  the
            broker-dealer solicits purchasers;

      o     block  trades in which the  broker-dealer  will  attempt to sell the
            shares as agent but may  position  and resell a portion of the block
            as principal to facilitate the transaction;

      o     purchases  by  a  broker-dealer  as  principal  and  resale  by  the
            broker-dealer for its account;

      o     an  exchange  distribution  in  accordance  with  the  rules  of the
            applicable exchange;

      o     privately negotiated transactions;

      o     settlement of short sales;

      o     broker-dealers  may agree with the  Selling  Stockholders  to sell a
            specified number of such shares at a stipulated price per share;

      o     a combination of any such methods of sale;

      o     through  the  writing or  settlement  of  options  or other  hedging
            transactions, whether through an options exchange or otherwise; or

      o     any other method permitted pursuant to applicable law.

      The Selling  Stockholders  may also sell  shares  under Rule 144 under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), if available,  rather
than under this prospectus.

      Broker-dealers  engaged by the Selling  Stockholders may arrange for other
brokers-dealers to participate in sales.  Broker-dealers may receive commissions
or discounts from the Selling  Stockholders  (or, if any  broker-dealer  acts as
agent  for the  purchaser  of  shares,  from the  purchaser)  in  amounts  to be
negotiated.  Each  Selling  Stockholder  does not expect these  commissions  and
discounts  relating  to its sales of shares to exceed what is  customary  in the
types of transactions involved.

<PAGE>


      In connection with the sale of our common stock or interests therein,  the
Selling  Stockholders may enter into hedging transactions with broker-dealers or
other  financial  institutions,  which may in turn  engage in short sales of the
common stock in the course of hedging the  positions  they  assume.  The Selling
Stockholders  may also sell shares of our common  stock short and deliver  these
securities  to close out their  short  positions,  or loan or pledge  the common
stock to  broker-dealers  that in turn may sell these  securities.  The  Selling
Stockholders   may  also  enter   into   option  or  other   transactions   with
broker-dealers  or other  financial  institutions or the creation of one or more
derivative  securities which require the delivery to such broker-dealer or other
financial  institution of shares offered by this  prospectus,  which shares such
broker-dealer  or  other  financial  institution  may  resell  pursuant  to this
prospectus (as supplemented or amended to reflect such transaction).

      The  Selling  Stockholders  and any  broker-dealers  or  agents  that  are
involved  in selling  the shares may be deemed to be  "underwriters"  within the
meaning of the Securities Act in connection with such sales. In such event,  any
commissions  received  by such  broker-dealers  or agents  and any profit on the
resale  of the  shares  purchased  by  them  may be  deemed  to be  underwriting
commissions or discounts under the Securities Act. Each Selling  Stockholder has
informed  the  Company  that it does not have any  agreement  or  understanding,
directly or indirectly, with any person to distribute the Common Stock.

      The Company is required to pay certain fees and  expenses  incurred by the
Company  incident to the  registration of the shares.  The Company has agreed to
indemnify the Selling Stockholders against certain losses,  claims,  damages and
liabilities, including liabilities under the Securities Act.

      Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities  Act, they will be subject to the prospectus  delivery
requirements of the Securities Act. In addition,  any securities covered by this
prospectus  which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather  than  under  this  prospectus.  Each  Selling
Stockholder  has  advised  us that they have not  entered  into any  agreements,
understandings or arrangements  with any underwriter or broker-dealer  regarding
the sale of the resale shares.  There is no underwriter or  coordinating  broker
acting in connection  with the proposed sale of the resale shares by the Selling
Stockholders.

      We agreed to keep this  prospectus  effective until the earlier of (i) the
date on which  the  shares  may be resold by the  Selling  Stockholders  without
registration  and  without  regard to any volume  limitations  by reason of Rule
144(k) under the  Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold  pursuant to the  prospectus  or Rule 144 under the
Securities  Act or any other rule of similar  effect.  The resale shares will be
sold only through  registered or licensed  brokers or dealers if required  under
applicable  state securities  laws. In addition,  in certain states,  the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable  state or an exemption  from the  registration  or  qualification
requirement is available and is complied with.


                                      -14-
<PAGE>

      Under applicable rules and regulations  under the Exchange Act, any person
engaged in the distribution of the resale shares may not  simultaneously  engage
in market making activities with respect to our common stock for a period of two
business days prior to the commencement of the  distribution.  In addition,  the
Selling  Stockholders  will be subject to applicable  provisions of the Exchange
Act and the rules and regulations thereunder,  including Regulation M, which may
limit the timing of  purchases  and sales of shares of our  common  stock by the
Selling Stockholders or any other person. We will make copies of this prospectus
available  to the Selling  Stockholders  and have  informed  them of the need to
deliver a copy of this  prospectus to each  purchaser at or prior to the time of
the sale.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.3
<SEQUENCE>4
<FILENAME>v02991_ex4-3.txt
<TEXT>

                                  EXHIBIT 4.3

                                                                       EXHIBIT B


NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
HAVE  BEEN  REGISTERED  WITH  THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR THE
SECURITIES   COMMISSION  OF  ANY  STATE  IN  RELIANCE  UPON  AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS  EVIDENCED BY A LEGAL  OPINION OF COUNSEL TO THE  TRANSFEROR
REASONABLY  ACCEPTABLE  TO THE COMPANY TO SUCH  EFFECT,  THE  SUBSTANCE OF WHICH
SHALL BE REASONABLY  ACCEPTABLE TO THE COMPANY.  THIS SECURITY MAY BE PLEDGED IN
CONNECTION  WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED  BROKER-DEALER  OR
OTHER LOAN WITH A FINANCIAL  INSTITUTION  THAT IS AN  "ACCREDITED  INVESTOR"  AS
DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT.

                          COMMON STOCK PURCHASE WARRANT

                  To Purchase 262,500 Shares of Common Stock of

                     PERMA-FIX ENVIRONMENTAL SERVICES, INC.

      THIS COMMON STOCK PURCHASE  WARRANT (the  "WARRANT")  CERTIFIES  that, for
value received,  Alexandra Global Master Fund Ltd. (the "HOLDER"),  is entitled,
upon the terms and subject to the  limitations  on exercise  and the  conditions
hereinafter  set  forth,  at any time on or after the date of  issuance  of this
Warrant (the "INITIAL  EXERCISE DATE") and on or prior to the third  anniversary
of the Initial  Exercise Date (the  "TERMINATION  DATE") but not thereafter,  to
subscribe  for and  purchase  from  Perma-Fix  Environmental  Services,  Inc., a
Delaware  corporation  (the  "COMPANY"),  up to  262,500  shares  (the  "WARRANT
SHARES")  of Common  Stock,  par value  $0.001 per share,  of the  Company  (the
"COMMON STOCK").  The purchase price of one share of Common Stock (the "EXERCISE
PRICE") under this Warrant shall be $2.92, Subject to adjustment hereunder.  The
Exercise  Price and the  number of  Warrant  Shares  for  which the  Warrant  is
exercisable  shall be subject to  adjustment  as provided  herein.  THIS WARRANT
SHALL BE SUBJECT TO, AND THE  CAPITALIZED  TERMS USED AND NOT OTHERWISE  DEFINED
HEREIN SHALL HAVE THE MEANINGS  SET FORTH IN, THAT CERTAIN  SECURITIES  PURCHASE
AGREEMENT (THE "PURCHASE  AGREEMENT"),  DATED MARCH 16, 2004,  AMONG THE COMPANY
AND THE PURCHASERS SIGNATORY THERETO.


                                       1
<PAGE>


      1.  TITLE  TO  WARRANT.  Prior to the  Termination  Date  and  subject  to
compliance with applicable laws and Section 7 of this Warrant,  this Warrant and
all rights  hereunder  are  transferable,  in whole or in part, at the office or
agency of the  Company by the Holder in person or by duly  authorized  attorney,
upon surrender of this Warrant  together with the Assignment Form annexed hereto
properly  endorsed.  The transferee shall sign an investment  letter in form and
substance reasonably satisfactory to the Company.

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

      3. EXERCISE OF WARRANT.

            (a) Exercise of the purchase rights  represented by this Warrant may
      be made at any time or times on or after the Initial  Exercise Date and on
      or before  the  Termination  Date by  delivery  to the  Company  of a duly
      executed  facsimile copy of the Notice of Exercise Form annexed hereto (or
      such other  office or agency of the Company as it may  designate by notice
      in  writing  to the  registered  Holder  at the  address  of  such  Holder
      appearing  on the  books  of the  Company);  PROVIDED,  HOWEVER,  within 5
      Trading  Days of the date said  Notice of  Exercise  is  delivered  to the
      Company, the Holder shall have surrendered this Warrant to the Company and
      the Company shall have received payment of the aggregate Exercise Price of
      the shares thereby  purchased by wire transfer or cashier's check drawn on
      a United States bank. Certificates for shares purchased hereunder shall be
      delivered to the Holder within the earlier of (i) 7 Trading Days after the
      date on which  the  Notice  of  Exercise  shall  have  been  delivered  by
      facsimile  copy or (ii) 5 Trading Days from the delivery to the Company of
      the Notice of Exercise Form by facsimile  copy,  surrender of this Warrant
      and payment of the aggregate  Exercise Price as set forth above  ("WARRANT
      SHARE DELIVERY DATE"); PROVIDED,  HOWEVER, in the event the Warrant is not
      surrendered or the aggregate Exercise Price is not received by the Company
      within 7 Trading Days after the date on which the Notice of Exercise shall
      be delivered by facsimile  copy,  the Warrant Share Delivery Date shall be
      extended to the extent such 7 Trading Day period is exceeded. This Warrant
      shall be deemed to have been exercised on the later of the date the Notice
      of Exercise is delivered to the Company by facsimile copy and the date the
      Exercise  Price is received by the  Company.  The Warrant  Shares shall be
      deemed to have been issued,  and Holder or any other person so  designated
      to be named  therein  shall be deemed to have become a holder of record of
      such  shares  for all  purposes,  as of the  date  the  Warrant  has  been
      exercised  by payment to the Company of the  Exercise  Price and all taxes
      required to be paid by the Holder,  if any, pursuant to Section 5 prior to
      the  issuance of such  shares,  have been paid.  If the  Company  fails to
      deliver to the  Holder a  certificate  or  certificates  representing  the
      Warrant  Shares  pursuant to this Section 3(a) by the seventh  Trading Day
      following the Warrant Share Delivery  Date,  then the Holder will have the
      right to rescind such exercise.


                                       2
<PAGE>


      In addition to any other rights  available  to the Holder,  if the Company
      fails to deliver to the Holder a certificate or certificates  representing
      the Warrant  Shares  pursuant  to an  exercise by the seventh  Trading Day
      after the Warrant Share Delivery Date, and if after such day the Holder is
      required  by its broker to  purchase  (in an open  market  transaction  or
      otherwise)  shares of Common Stock to deliver in satisfaction of a sale by
      the Holder of the Warrant  Shares which the Holder  anticipated  receiving
      upon such exercise (a "BUY-IN"), then the Company shall (1) pay in cash to
      the Holder  the  amount by which (x) the  Holder's  total  purchase  price
      (including brokerage  commissions,  if any) for the shares of Common Stock
      so purchased exceeds (y) the amount obtained by multiplying (A) the number
      of Warrant  Shares that the Company was  required to deliver to the Holder
      in connection  with the exercise at issue times (B) the price at which the
      sell order giving rise to such purchase  obligation was executed,  and (2)
      at the option of the Holder,  either  reinstate the portion of the Warrant
      and  equivalent  number of Warrant  Shares for which such exercise was not
      honored or deliver to the Holder the number of shares of Common Stock that
      would have been issued had the Company  timely  complied with its exercise
      and delivery obligations  hereunder.  For example, if the Holder purchases
      Common  Stock having a total  purchase  price of $11,000 to cover a Buy-In
      with  respect to an  attempted  exercise of shares of Common Stock with an
      aggregate  sale price giving rise to such purchase  obligation of $10,000,
      under clause (1) of the immediately  preceding  sentence the Company shall
      be required to pay the Holder $1,000. The Holder shall provide the Company
      written notice  indicating the amounts payable to the Holder in respect of
      the Buy-In,  together with  applicable  confirmations  and other  evidence
      reasonably requested by the Company. Nothing herein shall limit a Holder's
      right to pursue any other remedies available to it hereunder, at law or in
      equity including,  without  limitation,  a decree of specific  performance
      and/or  injunctive  relief with respect to the Company's failure to timely
      deliver certificates  representing shares of Common Stock upon exercise of
      the Warrant as required pursuant to the terms hereof.


            (b) If this Warrant shall have been  exercised in part,  the Company
      shall,  at the  time  of  delivery  of  the  certificate  or  certificates
      representing  Warrant Shares,  deliver to Holder a new Warrant  evidencing
      the rights of Holder to purchase the unpurchased Warrant Shares called for
      by this  Warrant,  which  new  Warrant  shall  in all  other  respects  be
      identical with this Warrant.

            (c) The Holder  shall not have the right to exercise  any portion of
      this Warrant,  pursuant to Section 3(a) or  otherwise,  to the extent that
      after giving effect to such issuance after exercise,  the Holder (together
      with the Holder's  affiliates),  as set forth on the applicable  Notice of
      Exercise,  would  beneficially  own in  excess  of 4.99% of the  number of
      shares of the Common Stock outstanding  immediately after giving effect to
      such  issuance.  For  purposes of the  foregoing  sentence,  the number of
      shares of Common Stock beneficially owned by the Holder and its affiliates
      shall include the number of shares of Common Stock  issuable upon exercise
      of this Warrant with respect to which the  determination  of such sentence
      is being  made,  but shall  exclude  the number of shares of Common  Stock
      which would be issuable upon (A) exercise of the  remaining,  nonexercised
      portion  of this  Warrant  beneficially  owned by the Holder or any of its
      affiliates   and  (B)  exercise  or  conversion  of  the   unexercised  or
      nonconverted  portion of any other  securities of the Company  (including,
      without  limitation,  any  other  Warrants)


                                       3
<PAGE>


      subject  to a  limitation  on  conversion  or  exercise  analogous  to the
      limitation contained herein beneficially owned by the Holder or any of its
      affiliates. Except as set forth in the preceding sentence, for purposes of
      this Section 3(c),  beneficial ownership shall be calculated in accordance
      with Section  13(d) of the Exchange  Act, it being  acknowledge  by Holder
      that the Company is not representing to Holder that such calculation is in
      compliance  with Section  13(d) of the Exchange  Act, and Holder is solely
      responsible  for  any  schedules   required  to  be  filed  in  accordance
      therewith.  To the extent that the  limitation  contained  in this Section
      3(c) applies, the determination of whether this Warrant is exercisable (in
      relation to other  securities  owned by the Holder) and of which a portion
      of this Warrant is  exercisable  shall be in the sole  discretion  of such
      Holder,  and the  submission of a Notice of Exercise shall be deemed to be
      such Holder's  determination  of whether this Warrant is  exercisable  (in
      relation to other securities owned by such Holder) and of which portion of
      this  Warrant  is  exercisable,  in each case  subject  to such  aggregate
      percentage limitation,  and the Company shall have no obligation to verify
      or confirm  the  accuracy  of such  determination.  For  purposes  of this
      Section 3(c), in determining  the number of  outstanding  shares of Common
      Stock,  the Holder may rely on the number of outstanding  shares of Common
      Stock as  reflected  in (x) the  Company's  most  recent Form 10-Q or Form
      10-K,  as the case may be, (y) a more recent  public  announcement  by the
      Company or (z) any other notice by the Company or the  Company's  Transfer
      Agent setting forth the number of shares of Common Stock outstanding. Upon
      the written or oral  request of the Holder,  the  Company  shall  within 3
      Trading  Days  confirm  orally  and in writing to the Holder the number of
      shares of Common  Stock  then  outstanding.  In any  case,  the  number of
      outstanding shares of Common Stock shall be determined after giving effect
      to the conversion or exercise of securities of the Company, including this
      Warrant,  by the Holder or its affiliates  since the date as of which such
      number of outstanding shares of Common Stock was reported.

            (d) If at any time after one year from the date of  issuance of this
      Warrant (a) there is no effective  Registration  Statement registering the
      resale  of the  Warrant  Shares  by the  Holder  at such  time and (b) the
      Warrant  Shares  are not  eligible  to be  sold  pursuant  to Rule  144(k)
      promulgated by the Commission pursuant to the Securities Act, as such rule
      may be amended from time to time or any similar rule or hereafter  adopted
      by the  Commission  , then this Warrant may also be exercised at such time
      by means of a "cashless exercise" in which the Holder shall be entitled to
      receive a  certificate  for the  number  of  Warrant  Shares  equal to the
      quotient obtained by dividing [(A-B) (X)] by (A), where:

      (A)   = the Closing  Price on the Trading Day  immediately  preceding  the
            date of such election;

      (B)   = the Exercise Price of this Warrant, as adjusted; and

      (X)   = the  number of  Warrant  Shares  issuable  upon  exercise  of this
            Warrant in  accordance  with the terms of this Warrant by means of a
            cash exercise rather than a cashless exercise.


                                       4
<PAGE>


            (e)  Subject  to the  provisions  of this  Section  3, if after  the
      Effective Date, the Closing Price for each of twenty  consecutive  Trading
      Days (the  "MEASUREMENT  PERIOD",  which period  shall not have  commenced
      until after the Effective  Date)  exceeds $6.00 per share (the  "THRESHOLD
      PRICE"), subject to adjustment for reverse and forward stock splits, stock
      dividends, stock combinations and other similar transactions of the Common
      Stock  that  occur  after  the date of the  Purchase  Agreement,  then the
      Company may, within two Trading Days of such period, call for cancellation
      of all or any portion of this  Warrant for which a Notice of Exercise  has
      not yet been delivered (such right, a "CALL"). To exercise this right, the
      Company must deliver to the Holder an irrevocable  written notice (a "CALL
      Notice"),  indicating  therein the portion of unexercised  portion of this
      Warrant to which such notice  applies.  If the  conditions set forth below
      for such  Call are  satisfied  from the  period  from the date of the Call
      Notice  through and including the Call Date (as defined  below),  then any
      portion of this Warrant  subject to such Call Notice for which a Notice of
      Exercise  shall not have been received from and after the date of the Call
      Notice will be  cancelled  at 6:30 p.m.  (New York City time) on the tenth
      Trading Day after the date the Call Notice is received by the Holder (such
      date, the "CALL DATE").  Any unexercised  portion of this Warrant to which
      the Call Notice does not pertain will be  unaffected  by such Call Notice.
      In  furtherance  thereof,  the Company  covenants  and agrees that it will
      honor all Notices of Exercise with respect to Warrant  Shares subject to a
      Call Notice that are tendered from the time of delivery of the Call Notice
      through 6:30 p.m. (New York City time) on the Call Date. The parties agree
      that any Notice of Exercise delivered  following a Call Notice shall first
      reduce to zero the number of Warrant  Shares  subject to such Call  Notice
      prior to reducing the  remaining  Warrant  Shares  available  for purchase
      under this  Warrant.  For  example,  if (x) this  Warrant then permits the
      Holder to acquire 100  Warrant  Shares,  (y) a Call Notice  pertains to 75
      Warrant  Shares,  and (z) prior to 6:30 p.m.  (New York City  time) on the
      Call Date the Holder tenders a Notice of Exercise in respect of 50 Warrant
      Shares,  then (1) on the Call Date the right under this Warrant to acquire
      25 Warrant Shares will be automatically cancelled, (2) the Company, in the
      time and  manner  required  under  this  Warrant,  will  have  issued  and
      delivered  to the  Holder 50 Warrant  Shares in  respect of the  exercises
      following  receipt of the Call Notice,  and (3) the Holder may,  until the
      Termination Date,  exercise this Warrant for 25 Warrant Shares (subject to
      adjustment  as herein  provided and subject to subsequent  Call  Notices).
      Subject  again to the  provisions  of this Section  3(e),  the Company may
      deliver  subsequent Call Notices for any portion of this Warrant for which
      the Holder shall not have delivered a Notice of Exercise.  Notwithstanding
      anything to the  contrary set forth in this  Warrant,  the Company may not
      deliver a Call Notice or require the cancellation of this Warrant (and any
      Call  Notice  will be  void),  unless,  from  the  beginning  of the  20th
      consecutive  Trading Days used to  determine  whether the Common Stock has
      achieved the Threshold  Price through the Call Date, (i) the Company shall
      have honored in  accordance  with the terms of this Warrant all Notices of
      Exercise  delivered  by 6:30 p.m.  (New York City  time) on the Call Date,
      (ii) the  Registration  Statement  shall be  effective  as to all  Warrant
      Shares and the prospectus  thereunder  available for use by the Holder for
      the resale of all such Warrant  Shares and (iii) the Common Stock shall be
      listed or quoted for trading on the Trading Market. The Company's right to
      Call the Warrant shall be exercised  ratably among the Purchasers based on
      each Purchaser's initial purchase of Common Stock pursuant to the Purchase
      Agreement.


                                       5
<PAGE>


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

      5.  CHARGES,  TAXES AND  EXPENSES.  Issuance of  certificates  for Warrant
Shares shall be made without  charge to the Holder for any issue or transfer tax
or other incidental expense in respect of the issuance of such certificate,  all
of which taxes and expenses shall be paid by the Company,  and such certificates
shall be  issued  in the name of the  Holder  or in such name or names as may be
directed by the Holder;  PROVIDED,  HOWEVER,  that in the event certificates for
Warrant  Shares are to be issued in a name  other  than the name of the  Holder,
this  Warrant  when  surrendered  for  exercise  shall  be  accompanied  by  the
Assignment Form attached hereto duly executed by the Holder; and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it
for any transfer tax incidental thereto.

      6. CLOSING OF BOOKS.  The Company will not close its stockholder  books or
records in any  manner  which  prevents  the timely  exercise  of this  Warrant,
pursuant to the terms hereof.

      7. TRANSFER, DIVISION AND COMBINATION.

            (a) Subject to compliance  with any applicable  securities  laws and
      the  conditions  set  forth  in  Sections  1 and  7(e)  hereof  and to the
      provisions of Section 4.1 of the Purchase Agreement,  this Warrant and all
      rights hereunder are transferable,  in whole or in part, upon surrender of
      this  Warrant at the  principal  office of the  Company,  together  with a
      written  assignment  of this Warrant  substantially  in the form  attached
      hereto  duly  executed  by the Holder or its agent or  attorney  and funds
      sufficient  to pay any  transfer  taxes  payable  upon the  making of such
      transfer.  Promptly  following  such  surrender  and,  if  required,  such
      payment,  the Company  shall execute and deliver a new Warrant or Warrants
      in the  name of the  assignee  or  assignees  and in the  denomination  or
      denominations specified in such instrument of assignment,  and shall issue
      to the assignor a new Warrant  evidencing  the portion of this Warrant not
      so assigned,  and this Warrant shall promptly be cancelled.  A Warrant, if
      properly  assigned,  may be  exercised by a new holder for the purchase of
      Warrant Shares without having a new Warrant issued.

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


                                       6
<PAGE>


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

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

            (e) If, at the time of the  surrender of this Warrant in  connection
      with any transfer of this Warrant,  the transfer of this Warrant shall not
      be registered  pursuant to an effective  registration  statement under the
      Securities Act and under applicable state securities or blue sky laws, the
      Company may require, as a condition of allowing such transfer (i) that the
      Holder or transferee of this Warrant,  as the case may be,  furnish to the
      Company a written  opinion of  counsel  (which  opinion  shall be in form,
      substance  and scope  customary  for  opinions  of counsel  in  comparable
      transactions)  to the  effect  that  such  transfer  may be  made  without
      registration   under  the  Securities  Act  and  under   applicable  state
      securities or blue sky laws,  (ii) that the holder or  transferee  execute
      and  deliver to the  Company an  investment  letter in form and  substance
      acceptable to the Company and (iii) that the  transferee be an "accredited
      investor" as defined in Rule 501(a)(1),  (a)(2), (a)(3), (a)(7), or (a)(8)
      promulgated under the Securities Act or a qualified institutional buyer as
      defined in Rule 144A(a) under the Securities Act.

      8. NO RIGHTS AS SHAREHOLDER UNTIL EXERCISE.  This Warrant does not entitle
the Holder to any voting rights or other rights as a shareholder  of the Company
prior to the exercise  hereof.  The Warrant  Shares shall be deemed to have been
issued,  and Holder or any other person so  designated to be named therein shall
be deemed to have become a holder of record of such shares for all purposes,  as
of the close of business  on the date the  Warrant  shall be deemed to have been
exercised pursuant to Section 3 and all taxes required to be paid by the Holder,
if any,  pursuant to Section 5 prior to the issuance of such  shares,  have been
paid.

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

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


                                       7
<PAGE>


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

      12. REORGANIZATION, RECLASSIFICATION, MERGER, CONSOLIDATION OR DISPOSITION
OF ASSETS.  In case the Company shall  reorganize  its capital,  reclassify  its
capital stock,  consolidate or merge with or into another corporation (where the
Company  is not the  surviving  corporation  or where  there  is a change  in or
distribution with respect to the Common Stock of the Company), or sell, transfer
or otherwise dispose of its property,  assets or business to another corporation
and,  pursuant to the terms of such  reorganization,  reclassification,  merger,
consolidation or disposition of assets,  shares of common stock of the successor
or acquiring  corporation,  or any cash,  shares of stock or other securities or
property of any nature whatsoever  (including  warrants or other subscription or
purchase  rights) in addition to or in lieu of common stock of the  successor or
acquiring  corporation ("OTHER PROPERTY"),  are to be received by or distributed
to the holders of Common  Stock of the  Company,  then the Holder shall have the
right thereafter to receive. upon exercise of this Warrant, the number of shares
of Common Stock of the successor or acquiring  corporation or of the Company, if
it is the surviving  corporation,  and Other  Property  receivable  upon or as a
result  of  such  reorganization,  reclassification,  merger,  consolidation  or
disposition  of assets by a Holder of the  number of shares of Common  Stock for
which this Warrant is exercisable  immediately  prior to such event.  In case of
any such reorganization,  reclassification, merger, consolidation or disposition
of assets,  the successor or acquiring  corporation  (if other than the Company)
shall expressly  assume the due and punctual  observance and performance of each
and every covenant and condition of this Warrant to be performed and observed by
the Company and all the obligations and liabilities  hereunder,  subject to such
modifications  as may be deemed  appropriate  (as  determined  in good  faith by
resolution  of the Board of  Directors  of the  Company) in order to provide for
adjustments of Warrant Shares for which this Warrant is exercisable  which shall
be as nearly  equivalent as practicable to the adjustments  provided for in this
Section 12. For purposes of this Section 12,  "common  stock of the successor or
acquiring  corporation"  shall  include stock of such  corporation  of any class
which is not  preferred  as to dividends or assets over any other class of stock
of such  corporation  and which is not  subject  to  redemption  and shall  also
include any evidences of indebtedness, shares of stock or other securities which
are convertible into or exchangeable for any such stock,  either  immediately or
upon the arrival of a specified  date or the happening of a specified  event and
any warrants or other rights to  subscribe  for or purchase any such stock.  The
foregoing  provisions  of this Section 12 shall  similarly  apply to  successive
reorganizations,  reclassifications,  mergers,  consolidations or disposition of
assets.


                                       8
<PAGE>


      13.  VOLUNTARY  ADJUSTMENT  BY THE  COMPANY.  The  Company may at any time
during the term of this Warrant  reduce the then current  Exercise  Price to any
amount and for any period of time deemed  appropriate  by the Board of Directors
of the Company.

      14. NOTICE OF ADJUSTMENT.  Whenever the number of Warrant Shares or number
or kind of securities or other  property  purchasable  upon the exercise of this
Warrant or the Exercise Price is adjusted, as herein provided, the Company shall
give  notice  thereof to the  Holder,  which  notice  shall  state the number of
Warrant Shares (and other securities or property)  purchasable upon the exercise
of this  Warrant  and the  Exercise  Price of such  Warrant  Shares  (and  other
securities or property) after such  adjustment,  setting forth a brief statement
of the facts  requiring  such  adjustment  and setting forth the  computation by
which such adjustment was made.

      15. NOTICE OF CORPORATE ACTION. If at any time:

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

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

            (c)  there  shall  be  a  voluntary  or   involuntary   dissolution,
      liquidation or winding up of the Company;

then, in any one or more of such cases,  the Company shall give to Holder (i) at
least 10 days' prior written  notice of the date on which a record date shall be
selected for such dividend,  distribution or right or for determining  rights to
vote  in  respect  of  any  such   reorganization,   reclassification,   merger,
consolidation, sale, transfer, disposition,  liquidation or winding up, and (ii)
in the case of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, dissolution, liquidation or winding up, at least 10
days'  prior  written  notice of the date when the same shall take  place.  Such
notice in accordance  with the foregoing  clause also shall specify (i) the date
on which  any such  record  is to be taken  for the  purpose  of such  dividend,
distribution  or right,  the date on which the holders of Common  Stock shall be
entitled  to any such  dividend,  distribution  or  right,  and the  amount  and
character  thereof,  and  (ii)  the  date  on  which  any  such  reorganization,
reclassification,    merger,   consolidation,   sale,   transfer,   disposition,
dissolution,  liquidation  or winding  up is to take place and the time,  if any
such  time is to be fixed,  as of which the  holders  of Common  Stock  shall be
entitled to exchange  their  Warrant  Shares for  securities  or other  property
deliverable upon such disposition,  dissolution, liquidation or winding up. Each
such written  notice shall be  sufficiently  given if addressed to Holder at the
last address of Holder  appearing  on the books of the Company and  delivered in
accordance with Section 17(d).


                                       9
<PAGE>


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

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

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

      17. MISCELLANEOUS.

            (a)  JURISDICTION.   All  questions   concerning  the  construction,
      validity,   enforcement  and  interpretation  of  this  Warrant  shall  be
      determined in accordance with the provisions of the Purchase Agreement.

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


                                       10
<PAGE>


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

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

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

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

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

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

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

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


                              ********************


                                       11
<PAGE>


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


Dated:  March 16, 2004

                                        PERMA-FIX ENVIRONMENTAL SERVICES, INC.

                                        By: /s/ Louis Centofanti
                                            Name:  Louis Centofanti
                                            Title: Chairman of the Board
                                                   Chief Executive Officer



                                       12
<PAGE>


                               NOTICE OF EXERCISE


To: Perma-Fix Environmental Services, Inc.

      (1) The undersigned  hereby elects to purchase  ________ Warrant Shares of
the Company  pursuant to the terms of the attached Warrant (only if exercised in
full), and tenders herewith payment of the exercise price in full, together with
all applicable transfer taxes, if any.

      (2) Payment shall take the form of (check applicable box):

            [ ] in lawful money of the United States; or

            [ ]  the  cancellation  of  such  number  of  Warrant  Shares  as is
            necessary,  in  accordance  with the formula set forth in subsection
            3(d), to exercise this Warrant with respect to the maximum number of
            Warrant  Shares  purchasable   pursuant  to  the  cashless  exercise
            procedure set forth in subsection 3(d).

      (3) Please issue a certificate or certificates  representing  said Warrant
Shares in the name of the  undersigned  or in such  other  name as is  specified
below:

                        _______________________________

The Warrant Shares shall be delivered to the following:

                         _______________________________

                         _______________________________

                         _______________________________


      (4) ACCREDITED  INVESTOR.  The undersigned is an "accredited  investor" as
defined in Regulation D under the Securities Act of 1933, as amended.


                                           [PURCHASER]


                                           By: ______________________________
                                           Name:
                                           Title:

                                           Dated:  ________________________

<PAGE>


                                 ASSIGNMENT FORM

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

                 Do not use this form to exercise the warrant.)

      FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby
are hereby  assigned  to  _______________________________________________  whose
address is _______________________________________________________________.

_______________________________________________________________

                                 Dated:  ______________, _______


                  Holder's Signature:  _____________________________

                  Holder's Address:    _____________________________

                                       _____________________________



Signature Guaranteed:  ___________________________________________


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



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>5
<FILENAME>v02991_ex5-1.txt
<TEXT>

                                   EXHIBIT 5.1

                          [CONNER & WINTERS LETTERHEAD]


                          ATTORNEYS & COUNSELORS AT LAW

                             Conner & Winters, P.C.
                           1700 One Leadership Square
                               211 North Robinson
                       Oklahoma City, Oklahoma 73102 7101
                                  405-272-5711
                                Fax 405-232-2695
                                  www.cwlaw.com

                                ----------------]

                             Writer's Direct Number
                                  405-272-5750
                             Writer's E-mail Address
                              isteinhorn@cwlaw.com


                                 April 30, 2004


Perma-Fix Environmental Services, Inc.
1940 Northwest 67th Place
Gainesville, Florida  32653

Re:   Perma-Fix Environmental  Services,  Inc.;
      Form S-3 Registration Statement, covering 6,391,751 Shares
      of Common Stock; OUR FILE NO. 7034.2
      ----------------------------------------------------------

Ladies and Gentlemen:

      We have acted as special counsel to Perma-Fix Environmental Services, Inc.
(the "Company") in connection with the preparation of the Form S-3  Registration
Statement  (the  "Registration  Statement")  to be filed by the Company with the
Securities and Exchange  Commission (the "Commission")  under the Securities Act
of 1933, as amended (the "Act").  The Registration  Statement includes 6,391,751
shares of the  Company's  common  stock,  par value $.001 per share (the "Common
Stock"), to be reoffered or resold from time to time by the Selling Stockholders
(as defined in the Registration Statement).

      The  6,391,751  shares  of  Common  Stock  included  in  the  Registration
Statement consist of the following:

      (a)   4,616,113  shares (the  "Shares") that were issued by the Company to
            the  following   subscribers  in  the  Company's  private  placement
            pursuant to the Securities Purchase Agreement,  dated March 16, 2004
            (the "Private Placement"):

            o     750,000 shares issued to Alexandra Global Master Fund Ltd;

            o     155,556 shares issued to Alpha Capital AG;

<PAGE>

Perma-Fix Environmental Services, Inc.
April 30, 2004
Page 2

            o     180,000 shares issued to the Baystar Capital II, L.P.;

            o     177,778 shares issued to Bristol Investment Fund, Ltd.;

            o     300,000 shares issued to Crescent International Ltd;

            o     666,668 shares issued to Crestview Capital Master LLC;

            o     75,000 shares issued to Geduld Capital Partners LP;

            o     111,111 shares issued to Gruber & McBaine International;

            o     50,000 shares issued to Irwin Geduld Revocable Trust;

            o     44,444 shares issued to J Patterson McBaine;

            o     111,111 shares issued to Jon D. Gruber and Linda W. Gruber;

            o     266,667 shares issued to Lagunitas Partners LP;

            o     222,222 shares issued to Omicron Master Trust;

            o     1,350,000 shares issued to Palisades Master Fund, L.P.;

            o     155,556 shares issued to Stonestreet LP;

      (b)   1,615,638  shares (the  "Warrant  Shares")  that are issuable by the
            Company upon the exercise of the following  warrants  (collectively,
            the  "Warrants"),  each having an exercise price of $2.92 per share,
            issued to the subscribers in the Private Placement:

            o     262,500 shares issuable to Alexandra  Global Master Fund, Ltd.
                  under a warrant, dated March 16, 2004;

            o     54,444  shares  issuable to Alpha  Capital AG under a warrant,
                  dated March 16, 2004;

            o     63,000  shares  issuable to Baystar  Capital II, L.P.  under a
                  warrant, dated March 16, 2004;

            o     62,222 shares issuable to Bristol  Investment Fund, Ltd. under
                  a warrant, dated March 16, 2004;


<PAGE>

Perma-Fix Environmental Services, Inc.
April 30, 2004
Page 3


            o     105,000 shares issuable to Crescent  International Ltd under a
                  warrant, dated March 16, 2004;

            o     233,334 shares issuable to Crestview  Capital Master LLC under
                  a warrant, dated March 16, 2004;

            o     26,250 shares issuable to the Geduld Capital Partners LP under
                  a warrant, dated March 16, 2004;

            o     38,889 shares issuable to Gruber & McBaine International under
                  a warrant, dated March 16, 2004;

            o     17,500 shares issuable to Irwin Geduld Revocable Trust under a
                  warrant, dated March 16, 2004;

            o     15,555 shares issuable to J Patterson McBaine under a warrant,
                  dated March 16, 2004;

            o     38,889  shares  issuable  to Jon D. Gruber and Linda W. Gruber
                  under a warrant, dated March 16, 2004;

            o     93,333  shares  issuable  to  Lagunitas  Partners  LP  under a
                  warrant, dated March 16, 2004;

            o     77,778  shares  issuable  to  Omicron  Master  Trust  under  a
                  warrant, dated March 16, 2004;

            o     472,500 shares issuable to Palisades Master Fund, L.P. under a
                  warrant, dated March 16, 2004; and

            o     54,444  shares  issuable  to  Stonestreet  LP under a warrant,
                  dated March 16, 2004; and

      (c)   160,000  shares (the  "Consultant  Shares")  which are issuable upon
            exercise of the following  warrants  (collectively,  the "Consultant
            Warrants"):

            o     100,000  shares  issuable  at an  exercise  price of $2.92 per
                  share to R.  Keith  Fetter  under a warrant,  dated  March 16,
                  2004;

            o     30,000 shares issuable at an exercise price of $2.92 per share
                  to Joe Dilustro under a warrant, dated March 16, 2004; and

            o     30,000 shares issuable at an exercise price of $2.92 per share
                  to Chet Dubov under a warrant, dated March 16, 2004.


<PAGE>

Perma-Fix Environmental Services, Inc.
April 30, 2004
Page 4


      We have examined such corporate records,  certificates of officers,  other
documents and questions of law, as we have  considered  necessary or appropriate
for the purposes of this opinion.

      On the basis of such examination,  review,  and assumption,  we are of the
opinion that:

      (a)   the 4,616,113 Shares  previously issued pursuant to the terms of the
            Private  Placement   constitute  validly  issued,  fully  paid,  and
            nonassessable shares of Common Stock;

      (b)   the 1,615,638  Warrant Shares issuable  pursuant to the terms of the
            Warrants will  constitute,  when so issued,  validly  issued,  fully
            paid, and nonassessable shares of Common Stock;

      (c)   the 160,000  Consultant Shares issuable pursuant to the terms of the
            Consultant Warrants will constitute, when so issued, validly issued,
            fully paid, and nonassessable shares of Common Stock;

      We consent to the reference to our firm under the heading "Legal  Opinion"
and to the filing of this opinion as Exhibit 5.1 to said Registration Statement.


                                          Very truly yours,

                                          CONNER & WINTERS, P.C.

                                          /s/ Conner & Winters, P.C.
                                          --------------------------

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>6
<FILENAME>v02991_ex10-3.txt
<TEXT>

                                  EXHIBIT 10.3


NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
HAVE  BEEN  REGISTERED  WITH  THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR THE
SECURITIES   COMMISSION  OF  ANY  STATE  IN  RELIANCE  UPON  AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS  EVIDENCED BY A LEGAL  OPINION OF COUNSEL TO THE  TRANSFEROR
REASONABLY  ACCEPTABLE  TO THE COMPANY TO SUCH  EFFECT,  THE  SUBSTANCE OF WHICH
SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.

                          COMMON STOCK PURCHASE WARRANT

                  To Purchase 100,000 Shares of Common Stock of

                     PERMA-FIX ENVIRONMENTAL SERVICES, INC.

      THIS COMMON STOCK PURCHASE  WARRANT (the  "WARRANT")  CERTIFIES  that, for
value received, R. Keith Fetter (the "HOLDER"),  is entitled, upon the terms and
subject to the limitations on exercise and the conditions hereinafter set forth,
at any time on or after  the date of  issuance  of this  Warrant  (the  "INITIAL
EXERCISE DATE") and on or prior to the third anniversary of the Initial Exercise
Date (the "TERMINATION DATE") but not thereafter,  to subscribe for and purchase
from  Perma-Fix  Environmental  Services,  Inc.,  a  Delaware  corporation  (the
"COMPANY"),  up to 100,000  shares (the "WARRANT  SHARES") of Common Stock,  par
value $0.001 per share, of the Company (the "COMMON STOCK").  The purchase price
of one share of Common Stock (the "EXERCISE  PRICE") under this Warrant shall be
$2.92,  subject to adjustment  hereunder.  The Exercise  Price and the number of
Warrant  Shares  for  which the  Warrant  is  exercisable  shall be  subject  to
adjustment as provided herein.

      TITLE TO WARRANT.  Prior to the Termination Date and subject to compliance
with applicable laws and Section 7 of this Warrant,  this Warrant and all rights
hereunder are transferable,  in whole or in part, at the office or agency of the
Company by the Holder in person or by duly authorized  attorney,  upon surrender
of this  Warrant  together  with the  Assignment  Form annexed  hereto  properly
endorsed.  The transferee shall sign an investment  letter in form and substance
reasonably satisfactory to the Company.


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

      2. EXERCISE OF WARRANT.

            (a) Exercise of the purchase rights  represented by this Warrant may
      be made at any time or times on or after the Initial  Exercise Date and on
      or before  the  Termination  Date by  delivery  to the  Company  of a duly
      executed  facsimile copy of the Notice of Exercise Form annexed hereto (or
      such other  office or agency of the Company as it may  designate by notice
      in  writing  to the  registered  Holder  at the  address  of  such  Holder
      appearing  on the  books  of the  Company);  PROVIDED,  HOWEVER,  within 5
      Trading  Days of the date said  Notice of  Exercise  is  delivered  to the
      Company, the Holder shall have surrendered this Warrant to the Company and
      the Company shall have received payment of the aggregate Exercise Price of
      the shares thereby  purchased by wire transfer or cashier's check drawn on
      a United States bank. Certificates for shares purchased hereunder shall be
      delivered  to the Holder  within the earlier of (i) 15 Trading  Days after
      the date on which the  Notice of  Exercise  shall have been  delivered  by
      facsimile copy or (ii) 10 Trading Days from the delivery to the Company of
      the Notice of Exercise Form by facsimile  copy,  surrender of this Warrant
      and payment of the aggregate  Exercise Price as set forth above  ("WARRANT
      SHARE DELIVERY DATE"); PROVIDED,  HOWEVER, in the event the Warrant is not
      surrendered or the aggregate Exercise Price is not received by the Company
      within 15  Trading  Days  after the date on which the  Notice of  Exercise
      shall be delivered by facsimile  copy,  the Warrant  Share  Delivery  Date
      shall be extended  to the extent  such 15 Trading Day period is  exceeded.
      This  Warrant  shall be deemed to have been  exercised on the later of the
      date the Notice of Exercise is delivered to the Company by facsimile  copy
      and the date the Exercise  Price is received by the  Company.  The Warrant
      Shares shall be deemed to have been issued, and Holder or any other person
      so  designated to be named therein shall be deemed to have become a holder
      of record of such shares for all purposes,  as of the date the Warrant has
      been  exercised  by payment to the Company of the  Exercise  Price and all
      taxes  required  to be paid by the Holder,  if any,  pursuant to Section 5
      prior to the issuance of such shares, have been paid. If the Company fails
      to deliver to the Holder a certificate or  certificates  representing  the
      Warrant Shares pursuant to this Section 3(a) by the fifteenth  Trading Day
      following the Warrant Share Delivery  Date,  then the Holder will have the
      right to rescind such exercise.

            (b) If this Warrant shall have been  exercised in part,  the Company
      shall,  at the  time  of  delivery  of  the  certificate  or  certificates
      representing  Warrant Shares,  deliver to Holder a new Warrant  evidencing
      the rights of Holder to purchase the unpurchased Warrant Shares called for
      by this  Warrant,  which  new  Warrant  shall  in all  other  respects  be
      identical with this Warrant.


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            (c) The Holder  shall not have the right to exercise  any portion of
      this Warrant,  pursuant to Section 3(a) or  otherwise,  to the extent that
      after giving effect to such issuance after exercise,  the Holder (together
      with the Holder's  affiliates),  as set forth on the applicable  Notice of
      Exercise,  would  beneficially  own in  excess  of 4.99% of the  number of
      shares of the Common Stock outstanding  immediately after giving effect to
      such  issuance.  For  purposes of the  foregoing  sentence,  the number of
      shares of Common Stock beneficially owned by the Holder and its affiliates
      shall include the number of shares of Common Stock  issuable upon exercise
      of this Warrant with respect to which the  determination  of such sentence
      is being  made,  but shall  exclude  the number of shares of Common  Stock
      which would be issuable upon (A) exercise of the  remaining,  nonexercised
      portion  of this  Warrant  beneficially  owned by the Holder or any of its
      affiliates   and  (B)  exercise  or  conversion  of  the   unexercised  or
      nonconverted  portion of any other  securities of the Company  (including,
      without  limitation,  any  other  Warrants)  subject  to a  limitation  on
      conversion  or  exercise  analogous  to the  limitation  contained  herein
      beneficially  owned by the Holder or any of its affiliates.  Except as set
      forth in the  preceding  sentence,  for  purposes  of this  Section  3(c),
      beneficial  ownership shall be calculated in accordance with Section 13(d)
      of the Exchange  Act, it being  acknowledge  by Holder that the Company is
      not  representing  to Holder that such  calculation is in compliance  with
      Section  13(d) of the Exchange Act, and Holder is solely  responsible  for
      any schedules required to be filed in accordance therewith.  To the extent
      that  the  limitation   contained  in  this  Section  3(c)  applies,   the
      determination of whether this Warrant is exercisable (in relation to other
      securities  owned by the Holder) and of which a portion of this Warrant is
      exercisable  shall  be in the  sole  discretion  of such  Holder,  and the
      submission  of a Notice of  Exercise  shall be deemed to be such  Holder's
      determination of whether this Warrant is exercisable (in relation to other
      securities  owned by such Holder) and of which  portion of this Warrant is
      exercisable, in each case subject to such aggregate percentage limitation,
      and the Company shall have no obligation to verify or confirm the accuracy
      of such  determination.  For purposes of this Section 3(c), in determining
      the number of outstanding  shares of Common Stock,  the Holder may rely on
      the number of  outstanding  shares of Common Stock as reflected in (x) the
      Company's  most recent  Form 10-Q or Form 10-K,  as the case may be, (y) a
      more recent public  announcement by the Company or (z) any other notice by
      the Company or the  Company's  Transfer  Agent setting forth the number of
      shares of Common  Stock  outstanding.  Upon the written or oral request of
      the Holder,  the Company shall within 3 Trading Days confirm orally and in
      writing  to  the  Holder  the  number  of  shares  of  Common  Stock  then
      outstanding. In any case, the number of outstanding shares of Common Stock
      shall be determined  after giving effect to the  conversion or exercise of
      securities of the Company,  including  this Warrant,  by the Holder or its
      affiliates since the date as of which such number of outstanding shares of
      Common Stock was reported.


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            (d)  Subject  to the  provisions  of this  Section  3, if after  the
      Effective Date, the Closing Price for each of twenty  consecutive  Trading
      Days (the  "MEASUREMENT  PERIOD",  which period  shall not have  commenced
      until after the Effective  Date)  exceeds $6.00 per share (the  "THRESHOLD
      PRICE"), subject to adjustment for reverse and forward stock splits, stock
      dividends, stock combinations and other similar transactions of the Common
      Stock that occur after the Initial  Exercise  Date,  then the Company may,
      within two Trading Days of such period,  call for  cancellation  of all or
      any portion of this  Warrant  for which a Notice of  Exercise  has not yet
      been delivered (such right, a "CALL"). To exercise this right, the Company
      must  deliver  to the  Holder  an  irrevocable  written  notice  (a  "CALL
      NOTICE"),  indicating  therein the portion of unexercised  portion of this
      Warrant to which such notice  applies.  If the  conditions set forth below
      for such  Call are  satisfied  from the  period  from the date of the Call
      Notice  through and including the Call Date (as defined  below),  then any
      portion of this Warrant  subject to such Call Notice for which a Notice of
      Exercise  shall not have been received from and after the date of the Call
      Notice will be  cancelled  at 6:30 p.m.  (New York City time) on the tenth
      Trading Day after the date the Call Notice is received by the Holder (such
      date, the "CALL DATE").  Any unexercised  portion of this Warrant to which
      the Call Notice does not pertain will be  unaffected  by such Call Notice.
      In  furtherance  thereof,  the Company  covenants  and agrees that it will
      honor all Notices of Exercise with respect to Warrant  Shares subject to a
      Call Notice that are tendered from the time of delivery of the Call Notice
      through 6:30 p.m. (New York City time) on the Call Date. The parties agree
      that any Notice of Exercise delivered  following a Call Notice shall first
      reduce to zero the number of Warrant  Shares  subject to such Call  Notice
      prior to reducing the  remaining  Warrant  Shares  available  for purchase
      under this  Warrant.  For  example,  if (x) this  Warrant then permits the
      Holder to acquire 100  Warrant  Shares,  (y) a Call Notice  pertains to 75
      Warrant  Shares,  and (z) prior to 6:30 p.m.  (New York City  time) on the
      Call Date the Holder tenders a Notice of Exercise in respect of 50 Warrant
      Shares,  then (1) on the Call Date the right under this Warrant to acquire
      25 Warrant Shares will be automatically cancelled, (2) the Company, in the
      time and  manner  required  under  this  Warrant,  will  have  issued  and
      delivered  to the  Holder 50 Warrant  Shares in  respect of the  exercises
      following  receipt of the Call Notice,  and (3) the Holder may,  until the
      Termination Date,  exercise this Warrant for 25 Warrant Shares (subject to
      adjustment  as herein  provided and subject to subsequent  Call  Notices).
      Subject  again to the  provisions  of this Section  3(d),  the Company may
      deliver  subsequent Call Notices for any portion of this Warrant for which
      the Holder shall not have delivered a Notice of Exercise.

      3.  NO  FRACTIONAL   SHARES  OR  SCRIP.  No  fractional  shares  or  scrip
representing  fractional  shares  shall  be  issued  upon the  exercise  of this
Warrant.  As to any fraction of a share which Holder would otherwise be entitled
to purchase  upon such  exercise,  the Company  shall pay a cash  adjustment  in
respect of such final fraction in an amount equal to such fraction multiplied by
the Exercise Price.

      4.  CHARGES,  TAXES AND  EXPENSES.  Issuance of  certificates  for Warrant
Shares shall be made without  charge to the Holder for any issue or transfer tax
or other incidental expense in respect of the issuance of such certificate,  all
of which taxes and expenses shall be paid by the Company,  and such certificates
shall be  issued  in the name of the  Holder  or in such name or names as may be
directed by the Holder;  PROVIDED,  HOWEVER,  that in the event certificates for
Warrant  Shares are to be issued in a name  other  than the name of the  Holder,
this  Warrant  when  surrendered  for  exercise  shall  be  accompanied  by  the
Assignment Form attached hereto duly executed by the Holder; and the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it
for any transfer tax incidental thereto.

      5. CLOSING OF BOOKS.  The Company will not close its stockholder  books or
records in any  manner  which  prevents  the timely  exercise  of this  Warrant,
pursuant to the terms hereof.


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      6. TRANSFER, DIVISION AND COMBINATION.

            (a) Subject to compliance  with any applicable  securities  laws and
      the conditions  set forth in Sections 1 and 7(e) hereof,  this Warrant and
      all rights hereunder are transferable, in whole or in part, upon surrender
      of this Warrant at the  principal  office of the Company,  together with a
      written  assignment  of this Warrant  substantially  in the form  attached
      hereto  duly  executed  by the Holder or its agent or  attorney  and funds
      sufficient  to pay any  transfer  taxes  payable  upon the  making of such
      transfer.  Promptly  following  such  surrender  and,  if  required,  such
      payment,  the Company  shall execute and deliver a new Warrant or Warrants
      in the  name of the  assignee  or  assignees  and in the  denomination  or
      denominations specified in such instrument of assignment,  and shall issue
      to the assignor a new Warrant  evidencing  the portion of this Warrant not
      so assigned,  and this Warrant shall promptly be cancelled.  A Warrant, if
      properly  assigned,  may be  exercised by a new holder for the purchase of
      Warrant Shares without having a new Warrant issued.

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

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

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

            (e) If, at the time of the  surrender of this Warrant in  connection
      with any transfer of this Warrant,  the transfer of this Warrant shall not
      be registered  pursuant to an effective  registration  statement under the
      Securities Act and under applicable state securities or blue sky laws, the
      Company may require, as a condition of allowing such transfer (i) that the
      Holder or transferee of this Warrant,  as the case may be,  furnish to the
      Company a written  opinion of  counsel  (which  opinion  shall be in form,
      substance  and scope  customary  for  opinions  of counsel  in  comparable
      transactions)  to the  effect  that  such  transfer  may be  made  without
      registration   under  the  Securities  Act  and  under   applicable  state
      securities or blue sky laws,  (ii) that the holder or  transferee  execute
      and  deliver to the  Company an  investment  letter in form and  substance
      acceptable to the Company and (iii) that the  transferee be an "accredited
      investor" as defined in Rule 501(a)(1),  (a)(2), (a)(3), (a)(7), or (a)(8)
      promulgated under the Securities Act or a qualified institutional buyer as
      defined in Rule 144A(a) under the Securities Act.


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      7. NO RIGHTS AS SHAREHOLDER UNTIL EXERCISE.  This Warrant does not entitle
the Holder to any voting rights or other rights as a shareholder  of the Company
prior to the exercise  hereof.  The Warrant  Shares shall be deemed to have been
issued,  and Holder or any other person so  designated to be named therein shall
be deemed to have become a holder of record of such shares for all purposes,  as
of the close of business  on the date the  Warrant  shall be deemed to have been
exercised pursuant to Section 3 and all taxes required to be paid by the Holder,
if any,  pursuant to Section 5 prior to the issuance of such  shares,  have been
paid.

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

      9. SATURDAYS, SUNDAYS, HOLIDAYS, ETC. If the last or appointed day for the
taking of any action or the  expiration of any right  required or granted herein
shall be a Saturday, Sunday or a legal holiday, then such action may be taken or
such right may be exercised on the next succeeding day not a Saturday, Sunday or
legal holiday.

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


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      11. REORGANIZATION, RECLASSIFICATION, MERGER, CONSOLIDATION OR DISPOSITION
OF ASSETS.  In case the Company shall  reorganize  its capital,  reclassify  its
capital stock,  consolidate or merge with or into another corporation (where the
Company  is not the  surviving  corporation  or where  there  is a change  in or
distribution with respect to the Common Stock of the Company), or sell, transfer
or otherwise dispose of its property,  assets or business to another corporation
and,  pursuant to the terms of such  reorganization,  reclassification,  merger,
consolidation or disposition of assets,  shares of common stock of the successor
or acquiring  corporation,  or any cash,  shares of stock or other securities or
property of any nature whatsoever  (including  warrants or other subscription or
purchase  rights) in addition to or in lieu of common stock of the  successor or
acquiring  corporation ("OTHER PROPERTY"),  are to be received by or distributed
to the holders of Common  Stock of the  Company,  then the Holder shall have the
right thereafter to receive. upon exercise of this Warrant, the number of shares
of Common Stock of the successor or acquiring  corporation or of the Company, if
it is the surviving  corporation,  and Other  Property  receivable  upon or as a
result  of  such  reorganization,  reclassification,  merger,  consolidation  or
disposition  of assets by a Holder of the  number of shares of Common  Stock for
which this Warrant is exercisable  immediately  prior to such event.  In case of
any such reorganization,  reclassification, merger, consolidation or disposition
of assets,  the successor or acquiring  corporation  (if other than the Company)
shall expressly  assume the due and punctual  observance and performance of each
and every covenant and condition of this Warrant to be performed and observed by
the Company and all the obligations and liabilities  hereunder,  subject to such
modifications  as may be deemed  appropriate  (as  determined  in good  faith by
resolution  of the Board of  Directors  of the  Company) in order to provide for
adjustments of Warrant Shares for which this Warrant is exercisable  which shall
be as nearly  equivalent as practicable to the adjustments  provided for in this
Section 12. For purposes of this Section 12,  "common  stock of the successor or
acquiring  corporation"  shall  include stock of such  corporation  of any class
which is not  preferred  as to dividends or assets over any other class of stock
of such  corporation  and which is not  subject  to  redemption  and shall  also
include any evidences of indebtedness, shares of stock or other securities which
are convertible into or exchangeable for any such stock,  either  immediately or
upon the arrival of a specified  date or the happening of a specified  event and
any warrants or other rights to  subscribe  for or purchase any such stock.  The
foregoing  provisions  of this Section 12 shall  similarly  apply to  successive
reorganizations,  reclassifications,  mergers,  consolidations or disposition of
assets.

      12.  VOLUNTARY  ADJUSTMENT  BY THE  COMPANY.  The  Company may at any time
during the term of this Warrant  reduce the then current  Exercise  Price to any
amount and for any period of time deemed  appropriate  by the Board of Directors
of the Company.

      13. NOTICE OF ADJUSTMENT.  Whenever the number of Warrant Shares or number
or kind of securities or other  property  purchasable  upon the exercise of this
Warrant or the Exercise Price is adjusted, as herein provided, the Company shall
give  notice  thereof to the  Holder,  which  notice  shall  state the number of
Warrant Shares (and other securities or property)  purchasable upon the exercise
of this  Warrant  and the  Exercise  Price of such  Warrant  Shares  (and  other
securities or property) after such  adjustment,  setting forth a brief statement
of the facts  requiring  such  adjustment  and setting forth the  computation by
which such adjustment was made.

      14. NOTICE OF CORPORATE ACTION. If at any time:

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


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

            (c)  there  shall  be  a  voluntary  or   involuntary   dissolution,
      liquidation or winding up of the Company;

then, in any one or more of such cases,  the Company shall give to Holder (i) at
least 10 days' prior written  notice of the date on which a record date shall be
selected for such dividend,  distribution or right or for determining  rights to
vote  in  respect  of  any  such   reorganization,   reclassification,   merger,
consolidation, sale, transfer, disposition,  liquidation or winding up, and (ii)
in the case of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, dissolution, liquidation or winding up, at least 10
days'  prior  written  notice of the date when the same shall take  place.  Such
notice in accordance  with the foregoing  clause also shall specify (i) the date
on which  any such  record  is to be taken  for the  purpose  of such  dividend,
distribution  or right,  the date on which the holders of Common  Stock shall be
entitled  to any such  dividend,  distribution  or  right,  and the  amount  and
character  thereof,  and  (ii)  the  date  on  which  any  such  reorganization,
reclassification,    merger,   consolidation,   sale,   transfer,   disposition,
dissolution,  liquidation  or winding  up is to take place and the time,  if any
such  time is to be fixed,  as of which the  holders  of Common  Stock  shall be
entitled to exchange  their  Warrant  Shares for  securities  or other  property
deliverable upon such disposition,  dissolution, liquidation or winding up. Each
such written  notice shall be  sufficiently  given if addressed to Holder at the
last address of Holder  appearing  on the books of the Company and  delivered in
accordance with Section 17(c).

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

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


                                       8
<PAGE>


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

      16. MISCELLANEOUS.

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

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

            (c)  NOTICES.  Any  and  all  notices  or  other  communications  or
      deliveries  required or  permitted  to be provided  hereunder  shall be in
      writing and shall be deemed given and effective on the earliest of (a) the
      date of  transmission,  if such notice or  communication  is delivered via
      facsimile  at the  facsimile  number  set  forth  on the  signature  pages
      attached  hereto prior to 6:30 p.m. (New York City time) on a Trading Day,
      (b) the next Trading Day after the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile number set forth
      on the signature  pages attached hereto on a day that is not a Trading Day
      or later than 6:30 p.m.  (New York City time) on any Trading  Day, (c) the
      second  Trading  Day  following  the  date  of  mailing,  if  sent by U.S.
      nationally  recognized  overnight  courier  service,  or (d)  upon  actual
      receipt  by the party to whom such  notice is  required  to be given.  The
      address for such notices and  communications  shall be as set forth on the
      signature pages attached hereto.

            (d) LIMITATION OF LIABILITY.  No provision hereof, in the absence of
      any  affirmative  action by Holder to  exercise  this  Warrant or purchase
      Warrant Shares,  and no enumeration  herein of the rights or privileges of
      Holder,  shall give rise to any liability of Holder for the purchase price
      of any Common  Stock or as a  stockholder  of the  Company,  whether  such
      liability is asserted by the Company or by creditors of the Company.


                                       9
<PAGE>


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

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

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

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

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

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


Dated:  March 16, 2004

                                PERMA-FIX ENVIRONMENTAL SERVICES, INC.

                                By: /S/ DR. LOUIS F. CENTOFANTI
                                    -----------------------------------------
                                    Name: Dr. Louis F. Centofanti
                                    Title: Chairman of the Board
                                           Chief Executive Officer



                                       10
<PAGE>


                               NOTICE OF EXERCISE

To: Perma-Fix Environmental Services, Inc.

      (1) The undersigned  hereby elects to purchase  ________ Warrant Shares of
the Company  pursuant to the terms of the attached Warrant (only if exercised in
full), and tenders herewith payment of the exercise price in full, together with
all applicable transfer taxes, if any.

      (2) Payment shall take the form of (check applicable box):

            [ ] a cashier's check drawn on a United States bank; or

            [ ] a wire transfer.

      (3) Please issue a certificate or certificates  representing  said Warrant
Shares in the name of the  undersigned  or in such  other  name as is  specified
below:

                         ______________________________


The Warrant Shares shall be delivered to the following:

                         ______________________________

                         ______________________________

                         ______________________________


      (4) ACCREDITED  INVESTOR.  The undersigned is an "accredited  investor" as
defined in Regulation D under the Securities Act of 1933, as amended.

                                    [PURCHASER]


                                    By: ______________________________
                                    Name:
                                    Title:

                                    Dated:  ________________________


<PAGE>


                                 ASSIGNMENT FORM

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

                 Do not use this form to exercise the warrant.)

      FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby
are hereby  assigned  to  _______________________________________________  whose
address is _______________________________________________________________.


_________________________________________________________________________


                                    Dated:  ______________, _______


                Holder's Signature: _____________________________

                Holder's Address: _______________________________

                                  _______________________________



Signature Guaranteed:  ___________________________________________


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


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>7
<FILENAME>v02991_ex23-1.txt
<TEXT>

Exhibit 23.1


Perma-Fix Environmental Services, Inc.
Gainesville, Florida

We  hereby  consent  to  the   incorporation  by  reference  in  the  Prospectus
constituting a part of this Registration  Statement of our report dated February
27, 2004,  relating to the  consolidated  financial  statements  and schedule of
Perma-Fix  Environmental  Services,  Inc.  and  subsidiaries  appearing  in  the
Company's Annual Report on Form 10-K for the year ended December 31, 2003.

We also  consent  to the  reference  to us under the  caption  "Experts"  in the
Prospectus.

/S/ BDO SEIDMAN, LLP
---------------------------
BDO Seidman, LLP
West Palm Beach, Florida
April 30, 2004


</TEXT>
</DOCUMENT>
</SUBMISSION>
