Common use of Minimum Monthly Principal Payments Clause in Contracts

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April March 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of (x) $100,000 8,333 for each Repayment Date beginning on March 1, 2005 and ending September 1, 2005, and (y) $10,417 for Repayment Dates beginning on October1, 2005 and ending August 31, 2007, respectively (the foregoing clauses (x) and (y), each a "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNTRelease Amount") each Monthly Principal Amount due on any Repayment Date occurring three (3) or more calendar months following any such release shall be increased by an amount equal to (x) 60% of such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until that exist following the date that is three (3) or more calendar months following any such release (including, without limitation, the Maturity Date Date) plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April May 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower Company shall make payments to the Holder Purchaser in the amount of $100,000 83,333.33 (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then due and owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount and interest on this Note shall commence on the one hundred twentieth (120th) day after the date of this Note not contained in and on the Restricted Account same day of each month thereafter (as defined in the Restricted Account Agreementeach a "Repayment Date") shall begin on April 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal and accrued interest into (a) shares of Series A Preferred Stock, par value $0.001 per share (the "Preferred Stock"), if the Borrower has filed a Certificate of Designation establishing a series of Preferred Stock, or (b) shares of common stock, par value $0.001 per share (the "Common Stock Stock"), if the Borrower has not filed a Certificate of Designation establishing a series of Preferred Stock, in each case pursuant to the terms hereof. Subject to Section 2.1 and Article 3 II below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 (8.33% of the "MONTHLY PRINCIPAL AMOUNT")initial Principal Amount, together with any interest accrued and unpaid interest then due on such portion of the Amortizing initial Principal Amount plus and any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount"). Payments made by the Holder or Borrower pursuant to Article II shall be applied first against accrued interest on the Principal Amount and then to Principal Amounts of not yet due Monthly Amounts, commencing with the Monthly Amount next payable and then Monthly Amounts thereafter in chronological order. Any Principal Amount, interest and any other sum arising under the Asset Purchase Agreement and any agreements entered into in connection therewith (the "Transaction Documents") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-twentieth (1/20th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that). Amounts of conversions of Principal Amount maxx xx the Holder or Borrower pursuant to Section 2.1 or Article III, following a release of an amount of funds from the Restricted Account and Redemption Amounts (as defined in the Restricted Account AgreementSection 2.3 of this Note) for the purposes set forth in the Restricted Account Side Letter (other than with respect actually paid to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release Borrower shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding original aggregate principal amount of outstanding under this Note not contained in (the "Principal Amount") equal to the amount of funds that have been released to the Borrower from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than a release that occurs as a result of a conversion of an outstanding Principal Amount) (each, a "Release Amount"; the date on which any such Release Amount is released, a "Release Date") shall begin with respect to each such Release Amount on April the first Repayment Date occurring on the later of (x) 90 or more days following each respective Release Date and (y) January 1, 2005 2005, and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount Xxxxxx has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in an amount equal to (x) the amount aggregate Amortizing Principal Amount subject to amortizing payments at such time pursuant to the immediately preceding sentence divided by (y) the sum of $100,000 (I) the number of Repayment Dates (including such Repayment Date) remaining until the Maturity Date plus (II) one (1) (such amount, the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such any accrued and unpaid interest on the Amortizing Principal Amount and any accrued and unpaid interest on the Non-Amortizing Principal Amount and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April November 1, 2005 2004 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 22,058.82 (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNTRelease Amount") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.number

Minimum Monthly Principal Payments. Amortizing The Company shall be obligated to pay the principal of this Debenture in installments as follows: (a) Twelve (12) equal monthly payments of the outstanding $50,000.00 principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 (the "MONTHLY PRINCIPAL AMOUNTMonthly Amount")) plus, together with any to the extent not otherwise paid, accrued and but unpaid interest then due on such portion plus any other obligations of the Amortizing Principal Amount plus any and all other amounts which are then owing Company to the Investor under this Note that have not been paid Debenture, the Purchase Agreement, or the Registration Rights Agreement, or otherwise. The first such installment payment shall due and payable on March 30, 2006, and subsequent installments shall be due and payable on the thirtieth (30th) day of each succeeding month thereafter (each a "Payment Date") until the Monthly Principal AmountCompany's obligations under this Debenture is satisfied in full. Such payments made under this Section 4.2 shall be applied first against outstanding fees and damages, together with such then accrued and but unpaid interest and such other amounts, collectively, then to Monthly Amounts commencing with the "MONTHLY AMOUNT") ; provided that, following a release of an amount of funds from the Restricted Account (as defined Monthly Amount first payable and then Monthly Amounts thereafter in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)chronological order. Any Amortizing Principal Amount principal amount, interest and any other sum arising under this Debenture that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date. (b) Any principal amount of this Debenture converted by the Holder pursuant to Article I hereof shall be applied first against outstanding fees and damages, then accrued but unpaid interest and then to Monthly Amounts commencing with the Monthly Amount first payable and then Monthly Amounts thereafter in chronological order. (c) The Company shall have the option to pay all or any portion of any Monthly Amount in newly issued, fully paid and nonassessable shares of Common Stock, with each share of Common Stock having a value equal to (i) eighty-five percent (85%) multiplied by (ii) the Market Price as of the third (3rd) Trading Day immediately preceding the Payment Date (the "Payment Calculation Date"); provided, that: (i) the Company delivers to the Holder, and the Holder receives, by the Payment Calculation Date a written notice of the Company's election under this Section 4.2(c) including a calculation of the number of shares to be delivered and an undertaking that the Company otherwise meets all of its obligations under this Section 4.2 to issue such shares; (ii) as of the Payment Date and the Payment Calculation Date, no Event of Default hereunder exists and is continuing, unless such Event of Default is cured within any applicable cure period or is otherwise waived in writing by the Holder in whole or in part at the Holder's option; (iii) as of the Payment Date and Payment Calculation Date, the resale of such shares of Common Stock to be delivered by the Company to the Holder shall have been registered pursuant to an effective Registration Statement, as defined in Registration Rights Agreement, and the Company is otherwise in compliance with its obligations under the Registration Right Agreement; (iv) as of the Payment Date, the number of shares of Common Stock to be issued to the Holder will not, in the reasonable opinion of the Holder, cause the Holder, whether individually or as a group, to be deemed to be the beneficial owner of more than 9.99% of the outstanding shares of Common Stock; (v) the aggregate number of shares of Common Stock that the Company may issue under this Section 4.2(c) shall not exceed (A) the percentage of the Holder's pro rata portion of the total outstanding Debentures issued pursuant to the Purchase Agreement multiplied by (B) twenty-five percent (25%) of (x) the average daily trading volume for the twenty (20) Trading Days preceding the Payment Calculation Date multiplied by (y) the VWAP for the twenty (20) Trading Days preceding the Payment Calculation Date; (vi) no Fundamental Change (as defined herein) has occurred since the Issue Date and the Company has no knowledge that a Fundamental Change may be announced by the Company or otherwise within ten (10) Trading Days after the Payment Date; and (vii) delivery of certificates for such shares of Common Stock shall be delivered in the same manner and in the same required time as provided under Section 1.4 herein treating the Payment Date as the date of delivery of a Notice of Conversion. (d) To the extent that the number of shares of Common Stock issued under Section 4.2(c) is insufficient to meet the Monthly Amount, the Company shall pay the difference in U.S. Dollars.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one- thirty-second (1/32nd) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release ). Amounts of an amount Conversions of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented made by funds contained in the Restricted Account) (eachHolder or Borrower pursuant to Section 2.1 or Article III, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release and Redemption Amounts actually paid to Borrower shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the ----------------------------------- outstanding principal amount Principal Amount and interest of this Note not contained in shall commence on the Restricted Account earlier of the Actual Effective Date (as defined in Section 11.1(iv) of the Restricted Account Subscription Agreement), or the ninety-first (91st) shall begin day after the Issue Date and on April 1, 2005 and shall recur on the same day of each succeeding month thereafter (each a "Repayment Date thereafter Date") until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in equal to the amount initial Principal Amount the quotient of $100,000 (the "MONTHLY PRINCIPAL AMOUNT")number of days from the first Repayment Date until the Maturity Date divided by 30, together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount"). In addition to the regular payment of the Monthly Amount, additional payments (each an "Interim Payment") ; provided that, following will be required to be made at the written election of the Holder (a release form of an which is annexed hereto) for each and every day (each a "Determination Date") the total reported dollar volume of the Common Stock exceeds $100,000 ("Liquidity Benchmark"). The amount of funds from each Interim Payment will be determined by multiplying the Restricted Account Fixed Principal Portion by a fraction the numerator of which is the total reported dollar volume of the Common Stock on a Determination Date and the denominator of which is the Liquidity Benchmark. The Holder must give written notice to the Borrower within two business days after a Determination Date of Holder's election to receive an Interim Payment. If such notice is xxxxn, the Holder may elect to receive and the Borrower must pay or deliver either (i) cash on the third business day following the date notice is given, or (ii) Common Stock valued at eighty-five percent (85%) of the weighted average volume price of the Common Stock using the AQR function as defined in the Restricted Account Agreementreported by Bloomberg L.P. ("VWAP") for the purposes set forth five (5) trading days preceding the date notice is given by the Holder of the demand for an Interim Payment. If the Holder elects to receive Common Stock in satisfaction of an Interim Payment, then the date of the Holder's notice shall be deemed a Conversion Date and the Common Stock must be delivered in the Restricted Account Side Letter (other than same manner and under the same conditions as required in connection with respect a Notice of Conversion. All payments of cash or amounts converted into Common Stock pursuant to a release that occurs as a result of a conversion of any this Note by the Holder or Borrower shall be applied first against outstanding fees and damages, then accrued interest on the Principal Amount represented by funds contained and then to Principal Amounts of not yet due Monthly Amounts, commencing with the Monthly Amount next payable and then Monthly Amounts thereafter in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)reverse chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Transaction Documents that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding aggregate principal amount of outstanding under this Note not contained in at any time (the Restricted Account (as defined in the Restricted Account Agreement"PRINCIPAL AMOUNT") shall begin on April 1, 2005 as set forth below and shall recur on the first business day of each succeeding Repayment Date thereafter month thereafter, until the Amortizing Maturity Date (each, an "AMORTIZATION Date"). For the purposes of the calculation of principal, interest and fees due and owing hereunder, the Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal shall be divided into Common Stock pursuant to the terms hereoftwo tranches: Tranche A (defined below) and Tranche B (defined below). Subject to Section 2.1 and Article 3 III below, beginning on each Repayment September 1, 2004, the first Amortization Date, the Borrower shall make monthly payments to the Holder on each Repayment Date occurring thereafter until the Maturity Date, (x) each in the amount of $100,000 1,470.59 (the "TRANCHE A MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due to date on such portion of the Amortizing Principal Amount first Fifty Thousand Dollars ($50,000) aggregate principal amount of this Note ("TRANCHE A") plus any and all other amounts which are then owing under this Note that with respect to such Tranche A but have not been paid (collectively, the Monthly Principal Amount"TRANCHE A MONTHLY AMOUNT") and (y) each in the amount of $16,176.47 (the "TRANCHE B MONTHLY PRINCIPAL AMOUNT"), together with such any accrued and unpaid interest to date on such portion of the next Two Million Nine Hundred Fifty Thousand Dollars ($2,950,000) aggregate principal amount of this Note ("TRANCHE B") plus any and all other amounts which are then owing under this Note with respect to such other amountsTranche B but have not been paid (collectively, the "TRANCHE B MONTHLY AMOUNT"). Each of the Tranche A Monthly Amount and the Tranche B Monthly Amount (collectively, the "MONTHLY AMOUNT") ; provided that), following a release in each case, shall be due and payable by the Borrower as set forth above, and only satisfaction of an amount all amounts due to Holder from Borrower under each of the Tranche A Monthly Amount and the Tranche B Monthly Amount, as applicable, shall be deemed to satisfy payment in full of the amounts due Holder and payable by Borrower on each respective Repayment Date and Amortization Date under this Note. In addition, in the event that any funds are released from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (any reason other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained related to Tranche B into Common Stock in accordance with Article II or III below, the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any amount of such release shall be increased by an added to the amount equal to (x) each future installment of the Tranche B Monthly Principal Amount occurring after the 90th day following such Release Amount divided by (y) the sum of (I) release, allocated among such future installments on a pro rata basis based on the number of Repayment Dates months remaining (beginning with the first month of allocation) until the Maturity Date plus (II) one (1)Date. Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April January 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 __________________ (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-twenty-fourth (1/24th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that). Amounts of Conversions of Principal Xxxxxx made by the Holder or Borrower pursuant to Section 2.1 or Article III, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect and Redemption Amounts actually paid to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release Borrower shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April January 1, 2005 2004 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 45,454.54 (the "MONTHLY PRINCIPAL AMOUNT"“Monthly Principal Amount”), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT"“Monthly Amount”) ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNT"“Release Amount”) each Monthly Principal Amount due on any Repayment Date occurring 90 days following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of of (I) the number of Repayment Dates remaining until that exist after the date that is 90 days following such release to and including the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount and interest of this Note not contained in shall commence on the Restricted Account earlier of thx Xxxxal Effective Date (as defined in Section 11.1(iv) of the Restricted Account Subscription Agreement), or the ninety-first (91st) shall begin day after the Issue Date and on April 1, 2005 and shall recur on the same day of each succeeding month thereafter (each a "Repayment Date thereafter Date") until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 4.7621% of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTFixed Principal Portion"), ) together with any interest accrued and unpaid interest then due on such portion of the Amortizing initial Principal Amount plus and any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount"). In addition to the regular payment of the Monthly Amount, additional payments (each an "Interim Payment") ; provided that, following will be required to be made at the written election of the Holder (a release form of an which is annexed hereto) for each and every day (each a "Determination Date") the total reported dollar volume of the Common Stock exceeds $190,000 ("Liquidity Benchmark"). The amount of funds from each Interim Payment will be determined by multiplying the Restricted Account Fixed Principal Portion by a fraction the numerator of which is the total reported dollar volume of the Common Stock on a Determination Date and the denominator of which is the Liquidity Benchmark. The Holder must give written notice to the Borrower within two business days after a Determination Date of Holder's election to receive an Interim Payment. If such notice is gxxxx, the Holder may elect to receive and the Borrower must pay or deliver (i) cash on the business day immediately following the date notice is given, or (ii) Common Stock valued at eighty-five percent (85%) of the weighted average volume price of the Common Stock using the AQR function as defined in the Restricted Account Agreementreported by Bloomberg L.P. ("VWAP") for the purposes set forth fifteen (15) trading days preceding the date notice is given by the Holder of the demand for an Interim Payment. If the Holder elects to receive Common Stock in satisfaction of an Interim Payment, then the date of the Holder's notice shall be deemed a Conversion Date and the Common Stock must be delivered in the Restricted Account Side Letter (other than same manner and under the same conditions as required in connection with respect a Notice of Conversion. All payments of cash or amounts converted into Common Stock pursuant to a release that occurs as a result of a conversion of any this Note by the Holder or Borrower shall be applied first against outstanding fees and damages, then accrued interest on the Principal Amount represented by funds contained and then to Principal Amounts of not yet due Monthly Amounts, commencing with the Monthly Amount next payable and then Monthly Amounts thereafter in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)reverse chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Transaction Documents that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding aggregate principal amount of outstanding under this Note at any time (the “Principal Amount”) shall begin on June 1, 2008 and shall recur on the first business day of each succeeding month thereafter until the Maturity Date (each an “Amortization Date”).” 3. Each of Valens Offshore, Valens US, PSource and the Company hereby agree that Section 2.3 of the 2004 Note is hereby amended by deleting Section 2.3 in its entirety. 4. Each of Laurus, Valens Offshore, Valens US, PSource and the Company hereby agree that the text “one hundred thirty percent (130%)” set forth in Section 2.3 of the 2005 Note shall be deleted in its entirety and the text “one hundred seven and one half percent (107.5%) shall be inserted in lieu thereof. 5. In consideration of the amendment contemplated in Section 1 above, the Company hereby agrees that, on or prior to July 31, 2008, the Company shall make a payment to Agent in cash or other immediately available funds in full of one hundred seven and one half percent (107.5%) of the then total outstanding Principal Amount of the 2004 Note together with accrued and unpaid interest, and any and all other sums due, accrued or payable under the 2004 Note outstanding on the date of such payment (the “Payment Amount”). Upon receipt by Agent, the Payment Amount may be applied pro rata to (i) Valens Offshore (the “Valens Offshore Payment”), (ii) Valens US (the “Valens US Payment”) and (ii) PSource (the “PSource Payment”) relative to the amount of debt each of the applicable Holders hold as of the date of receipt by Agent of the Payment Amount. 6. Valens Offshore and the Company hereby agree that the fair market value of the Valens Offshore Payment (as reasonably determined by the parties) is hereby designated for tax purposes as interest. PSource and the Company hereby agree that the fair market value of the PSource Payment (as reasonably determined by the parties) received by PSource in consideration of the amendments herein made by PSource hereunder shall be treated for U.S. federal income tax purposes as a payment of additional interest. Valens Offshore, PSource and the Company further agree to file all applicable tax returns in accordance with such characterizations set forth above, treating each obligation to each Holder as a separate obligation, and shall not take a position on any tax return or in any judicial or administrative proceeding that is inconsistent with such characterization. Notwithstanding the foregoing, nothing contained in this paragraph shall or shall be deemed to modify or impair in any manner whatsoever the Restricted Account Company’s obligations from time to time owing to the Holders under the Notes. 7. The amendments set forth above shall be effective as of the date first above written (the “Amendment Effective Date”) on the date when the Company, each Holder and Agent shall have executed and the Company shall have delivered to the Holders its respective counterpart to this Amendment. 8. Except as specifically set forth in this Amendment, there are no other amendments, modifications or waivers to the Notes, and all of the other related forms, and the terms and provisions of the Notes and other related forms shall remain in full force and effect. 9. From and after the date first written above, all references to the Notes shall be deemed to be references to the Notes as modified hereby. 10. The Company hereby represents and warrants to the Holders that other than as contemplated by this amendment and waiver (i) no Event of Default (as defined in the Restricted Account AgreementNotes) exists on the date hereof, (ii) on the date hereof, all representations, warranties and covenants made by the Company, directly or indirectly in connection with the issuance by the Company to the Holders of the Notes are true, correct and complete and (iii) on the date hereof, all of the Company’s and its Subsidiaries’ covenant requirements have been met. 11. This Amendment shall begin on April 1, 2005 be binding upon the parties hereto and their respective successors and permitted assigns and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant inure to the terms hereof. Subject to Section 2.1 benefit of and Article 3 below, on be enforceable by each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus parties hereto and their respective successors and permitted assigns. THIS AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. This Amendment may be executed in any and all other amounts number of counterparts, each of which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum original, but all of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) which shall constitute one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Dateinstrument.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April January 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 7,953.13 (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount shall commence on the forty-fifth day after the date of this Note not contained in Xxxx xnd on the Restricted Account same day of each month thereafter (as defined in the Restricted Account Agreementeach a "Repayment Date") shall begin on April 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-twelfth (1/12th) of the "MONTHLY PRINCIPAL AMOUNT"), initial Principal Amount together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts (not including interest) which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) ). Monthly Amounts due for the purposes set forth in initial three Repayment Dates shall be deferred until the Restricted Account Side Letter (other than with respect to a release that occurs as a result fourth Repayment Date. Amounts of a conversion conversions of any Principal Amount represented made by funds contained in the Restricted Account) (eachHolder or Borrower pursuant to Section 2.1 or Artxxxx XII, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release and amounts converted pursuant to Section 2.3 of this Note shall be increased by an amount equal applied first against outstanding fees and damages, accrued interest on the Principal Amount, and then to (x) such Release the principal portion of Monthly Amounts, commencing with the Monthly Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Subscription Agreement that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) Amortizing Principal Amount shall begin on April November 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 III below, on each Repayment Date, the Borrower shall make payments to the Holder Holders in the amount of $100,000 18,977.27 (the "MONTHLY PRINCIPAL AMOUNT"“Monthly Principal Amount”), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Xxxxxx, the Non-Restricted Non-Amortizing Principal Amount and the Restricted Non-Amortizing Principal Xxxxxx plus any and all other amounts which are then owing under this Term Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") “Monthly Amount”); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for pursuant to the purposes set forth Release as defined in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT"“Release Amount”) each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such the Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April November 1, 2005 2004 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 3,371.79 (the "MONTHLY PRINCIPAL AMOUNT"“Monthly Principal Amount”), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") “Monthly Amount”); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNT"“Release Amount”) each Monthly Principal Amount due on any Repayment Date occurring three months following any such release shall be increased by (A) in the event that any such release occurs prior to the one year anniversary of the Closing Date, an amount equal to (x) such Release Amount divided by (y) the sum remainder of (I) the number of Repayment Dates remaining until calendar months that begin prior to the Maturity tenth anniversary of the Closing Date plus minus (II) three (3) and (B) in the event that any such release occurs on or after the one year anniversary of the Closing Date, an amount equal to (1x) such Release Amount divided by (y) the remainder of (I) the number of calendar months that begin prior to the fifth anniversary of the Closing Date minus (II) three (3). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-thirtieth (1/30th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release ). Amounts of an amount Conversions of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented made by funds contained in the Restricted Account) (eachHolder or Borrower pursuant to Section 2.1 or Artixxx XXI, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release and Redemption Amounts actually paid to Borrower shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-thirtieth (1/30th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release ). Amounts of an amount Conversions of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented made by funds contained in the Restricted Account) (eachHolder or Borrower pursuant to Section 2.1 or Article III, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release and Redemption Amounts actually paid to Borrower shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of that portion of the outstanding principal amount of this Note not contained in credited to the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April May 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make principal payments to the Holder in the amount of $100,000 (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing due under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ); provided that, subject to Section 2.1(d) hereof, should the Holder elect to voluntarily convert any portion of the Note (in excess of any amounts necessary to satisfy any Monthly Amounts then due and payable by the Borrower hereunder) pursuant to Article III hereof, the Principal Amount that is so converted shall be deemed to be a conversion of the Non-Amortizing Principal Amount and corresponding amounts (minus accrued and unpaid interest on the Non-Amortizing Principal Amount) shall be released to the Borrower from the Restricted Account within three (3) business days of such conversion; and provided further that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Amortizing or Non-Amortizing Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount and interest of this Note not contained in shall commence on the Restricted Account six month annxxxxxxry date of this Note and on the same day of each month thereafter (as defined in the Restricted Account Agreementeach a "Repayment Date") shall begin on April 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has and interest have been repaid in full, whether by the payment of cash or by the conversion of such principal Principal Amount and interest into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, Date the Borrower shall make payments to the Holder in the amount of $100,000 five and one-half percent (5.5%) of the initial Principal Amount ("MONTHLY PRINCIPAL AMOUNTFixed Principal Portion"), together with any all interest accrued and unpaid interest then due on such portion the Note as of the Amortizing Principal Amount plus Repayment Date and any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount"). In addition to the regular payment of the Monthly Amount, additional payments (each an "Interim Payment") ; provided thatwill be required to be made at the written election of the Holder (a form of which is annexed hereto) for each and every day (each a "Determination Date") the total reported dollar volume of the Common Stock exceeds $46,000 ("Liquidity Benchmark"). The amount of each Interim Payment will be determined by multiplying the Fixed Principal Portion by a fraction the numerator of which is the total reported dollar volume of the Common Stock on a Determination Date and the denominator of which is the Liquidity Benchmark. The Holder must give written notice to the Borrower within two business days after a Determination Date of Holder's election to receive an Interim Payment. If such notice is gxxxx, the Holder may elect to receive and the Borrower must pay or deliver (i) cash on the business day immediately following a release the date notice is given, or (ii) Common Stock valued at eighty-five percent (85%) of the average closing bid price of the Common Stock as reported by Bloomberg L.P. for the five (5) trading days preceding the date notice is given by the Holder of the demand for an Interim Payment. If the Holder elects to receive Common Stock in satisfaction of an amount Interim Payment, then the date of funds from the Restricted Account (as defined Holder's notice shall be deemed a Conversion Date and the Common Stock must be delivered in the Restricted Account Agreement) for same manner and under the purposes set forth same conditions as required in connection with a Notice of Conversion. All payments of cash or amounts converted into Common Stock pursuant to this Note by the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Holder or Borrower shall be applied first against outstanding fees and damages, then accrued interest on the Principal Amount represented by funds contained and then to Principal Amounts of not yet due Monthly Amounts, commencing with the Monthly Amount next payable and then Monthly Amounts thereafter in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)reverse chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Transaction Documents that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin commence on April February 1, 2005 2006 and shall recur on the first business day of each succeeding consecutive calendar month thereafter (each a “Repayment Date thereafter Date”) until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-eighteenth (1/18th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts amounts, except for regular interest, which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release ). Amounts of an amount conversions of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented made by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release Holder or Borrower pursuant to Section 2.1 or Article III shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Subscription Agreement that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date. FOR VALUE RECEIVED, INNOVATIVE FOOD HOLDINGS, INC., a Florida corporation (hereinafter called "Borrower"), hereby promises to pay to MOMONA CAPITAL, 0 Xxxxxx Xxxx, Monsey, New York 10952, Fax: (000) 000-0000 (the "Holder") or its registered assigns or successors in interest or order, without demand, the sum of Twenty-Five Thousand Dollars ($25,000.00) (“Principal Amount”), with simple and unpaid interest thereon, on August 25, 2007 (the "Maturity Date"), if not sooner paid. This Note has been entered into pursuant to the terms of a subscription agreement between the Borrower and the Holder, dated of even date herewith (the “Subscription Agreement”), and shall be governed by the terms of such Subscription Agreement. Unless otherwise separately defined herein, all capitalized terms used in this Note shall have the same meaning as is set forth in the Subscription Agreement. The following terms shall apply to this Note:

Minimum Monthly Principal Payments. Amortizing Borrower shall make monthly payments of on the Repayment Date for the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin Amortized Principal Amount beginning on April June 1, 2005 and shall recur recurring on each succeeding Repayment Date thereafter until the Amortizing Principal Amount Xxxxxx has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, beginning on June 1, 2005 on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 30,303.03 (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNTRelease Amount") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in and accrued interest shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 2 and Article 3 III below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-twentieth (1/20th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that). Amounts of conversions of Principal Xxxxxx made by the Holder or Borrower pursuant to Section 2 or Article III, following a release of an amount of funds from the Restricted Account and Redemption Amounts (as defined in Section 2.3 of this Note) actually paid to Borrower shall be applied first against outstanding fees and damages, then accrued interest on the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained and then to Monthly Amounts commencing with the Monthly Amounts first payable and then Monthly Amounts thereafter in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Subscription Agreement that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April December 1, 2005 2004 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 200,000 (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNTRelease Amount") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April July 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 14,705.88 (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNTRelease Amount") each Monthly Principal Amount due on any Repayment Date occurring on or after the 90th day following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates occurring on or after the 90th day following any such release and remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-thirty-second (1/32nd) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that). Amounts of conversions of Principal Amount made by the Holder or Borrower pursuant to Section 2.1 or Artxxxx XII, following a release of an amount of funds from the Restricted Account and Redemption Amounts (as defined in the Restricted Account AgreementSection 2.3 of this Note) for the purposes set forth in the Restricted Account Side Letter (other than with respect actually paid to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release Borrower shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding aggregate principal amount of outstanding under this Note not contained in at any time (the Restricted Account (as defined in the Restricted Account Agreement“Principal Amount”) shall begin on April 1the first business day in September, 2005 2004 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the first business day of each succeeding month thereafter until the Maturity Date (each, an “Amortization Date”) as set forth in the table below: 2. Section (d) in the preamble of each Warrant is hereby deleted in its entirety and replaced with the following new sentence in lieu thereof: The "Exercise Price" applicable under this Warrant shall be $0.60. 3. The amendment set forth herein shall be effective as of the date first above written (the “Amendment Effective Date”) on the date when each of the Company and Laurus shall have executed and the Company shall have delivered to Laurus its respective counterpart to this Amendment. 4. Except as specifically set forth in this Amendment or other written Amendments previously entered into by the Company and Laurus, there are no other amendments, modifications or waivers to the Loan Documents, and all of the other forms, terms and provisions of the Loan Documents remain in full force and effect. 5. The Company hereby represents and warrants to Laurus that (i) no Event of Default exists on the date hereof, after giving effect to this Amendment, (ii) on the date hereof all representations, warranties and covenants made by the Company in connection with the Loan Documents are true, correct and complete and (iii) on the date hereof all of the Company’s and its Subsidiaries’ covenant requirements have been met. 6. From and after the Amendment Effective Date, all references in the Loan Documents to any of the Loan Documents shall be deemed to be references to such Loan Documents as modified hereby. 7. From and after the Amendment Effective Date, and at least until December 31, 2006, (i) Laurus’s current dilution reserve imposed against Accounts Availability (as defined in the Security Agreement, dated as of May 27, 2004, between the Company and Laurus (the “Security Agreement”)) shall not be greater than 7% and (ii) Laurus’s current reserves imposed against Inventory Availability (as defined in the Security Agreement) shall not be greater than $2,000,0000 in the aggregate. 8. This Amendment shall be binding upon the parties hereto and their respective successors and permitted assigns and shall inure to the benefit of and be enforceable by each of the parties hereto and their respective successors and permitted assigns. THIS AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. This Amendment may be executed in any number of counterparts, each of which shall be an original, but all of which shall constitute one instrument.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin commence on April February 1, 2005 2006 and shall recur on the first business day of each succeeding consecutive calendar month thereafter (each a “Repayment Date thereafter Date”) until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-eighteenth (1/18th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts amounts, except for regular interest, which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that, following a release ). Amounts of an amount conversions of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented made by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release Holder or Borrower pursuant to Section 2.1 or Article III shall be increased by an amount equal applied to (x) such Release Amount divided by (y) Monthly Amounts commencing with the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)Monthly Amounts first payable and then Monthly Amounts thereafter in chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Subscription Agreement that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date. FOR VALUE RECEIVED, INNOVATIVE FOOD HOLDINGS, INC., a Florida corporation (hereinafter called "Borrower"), hereby promises to pay to LANE VENTURES, INC., 000 Xxxx Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000, Fax: (000) 000-0000 (the "Holder") or its registered assigns or successors in interest or order, without demand, the sum of Ten Thousand Dollars ($10,000.00) (“Principal Amount”), with simple and unpaid interest thereon, on August 25, 2007 (the "Maturity Date"), if not sooner paid. This Note has been entered into pursuant to the terms of a subscription agreement between the Borrower and the Holder, dated of even date herewith (the “Subscription Agreement”), and shall be governed by the terms of such Subscription Agreement. Unless otherwise separately defined herein, all capitalized terms used in this Note shall have the same meaning as is set forth in the Subscription Agreement. The following terms shall apply to this Note:

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April October 1, 2005 2004 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 53,030.30 (as adjusted pursuant to the following proviso, the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNTRelease Amount") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Xxxxxx and interest on this Note shall commence on the one hundred twentieth (120th) day after the date of this Note not contained in and on the Restricted Account same day of each month thereafter (as defined in the Restricted Account Agreementeach a "Repayment Date") shall begin on April 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal and accrued interest into (a) shares of Series A Preferred Stock, par value $0.001 per share (the "Preferred Stock"), if the Borrower has filed a Certificate of Designation establishing a series of Preferred Stock, or (b) shares of common stock, par value $0.001 per share (the "Common Stock Stock"), if the Borrower has not filed a Certificate of Designation establishing a series of Preferred Stock, in each case pursuant to the terms hereof. Subject to Section 2.1 and Article 3 II below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 (8.33% of the "MONTHLY PRINCIPAL AMOUNT")initial Principal Amount, together with any interest accrued and unpaid interest then due on such portion of the Amortizing initial Principal Amount plus and any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount"). Payments made by the Holder or Borrower pursuant to Article II shall be applied first against accrued interest on the Principal Amount and then to Principal Amounts of not yet due Monthly Amounts, commencing with the Monthly Amount next payable and then Monthly Amounts thereafter in chronological order. Any Principal Amount, interest and any other sum arising under the Asset Purchase Agreement and any agreements entered into in connection therewith (the "Transaction Documents") ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount of this Note not contained in shall commence on the Restricted Account first (as defined in the Restricted Account Agreement1st) shall begin on April 1, 2005 Repayment Date and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 one-nineteenth (1/19th) of the initial Principal Amount (the "MONTHLY PRINCIPAL AMOUNTMonthly Principal Amount"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNTMonthly Amount") ; provided that). Amounts of conversions of Principal Amount made by the Holder or Borroxxx xxrsuant to Section 2.1 or Article III, following a release of an amount of funds from the Restricted Account and Redemption Amounts (as defined in Section 2.3 of this Note) actually paid to Holder shall be applied first against outstanding fees and damages, then against interest accrued on the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained and then to Monthly Amounts commencing with the Monthly Amounts first payable and then Monthly Amounts thereafter in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1)chronological order. Any Amortizing Principal Amount Amount, interest and any other sum arising under the Subscription Agreement that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount of this Note not contained in the Restricted Account (as defined in the Restricted Account Agreement) shall begin on April June 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal into Common Stock pursuant to the terms hereof. Subject to Section 2.1 and Article 3 below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 30,303.03 (the "MONTHLY PRINCIPAL AMOUNT"), together with any accrued and unpaid interest then due on such portion of the Amortizing Principal Amount plus any and all other amounts which are then owing under this Note that have not been paid (the Monthly Principal Amount, together with such accrued and unpaid interest and such other amounts, collectively, the "MONTHLY AMOUNT") ); provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted AccountAmount) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.

Minimum Monthly Principal Payments. Amortizing payments of the outstanding principal amount Principal Amount and interest on this Note shall commence on the one hundred twentieth (120th) day after the date of this Note not contained in and on the Restricted Account same day of each month thereafter (as defined in the Restricted Account Agreementeach a “Repayment Date”) shall begin on April 1, 2005 and shall recur on each succeeding Repayment Date thereafter until the Amortizing Principal Amount has been repaid in full, whether by the payment of cash or by the conversion of such principal and accrued interest into (a) shares of Series A Preferred Stock, par value $0.001 per share (the “Preferred Stock”), if the Borrower has filed a Certificate of Designation establishing a series of Preferred Stock, or (b) shares of common stock, par value $0.001 per share (the “Common Stock Stock”), if the Borrower has not filed a Certificate of Designation establishing a series of Preferred Stock, in each case pursuant to the terms hereof. Subject to Section 2.1 and Article 3 II below, on each Repayment Date, the Borrower shall make payments to the Holder in the amount of $100,000 (8.33% of the "MONTHLY PRINCIPAL AMOUNT")initial Principal Amount, together with any interest accrued and unpaid interest then due on such portion of the Amortizing initial Principal Amount plus and any and all other amounts which are then owing under this Note that have not been paid (collectively, the “Monthly Amount”). Payments made by the Holder or Borrower pursuant to Article II shall be applied first against accrued interest on the Principal Amount and then to Principal Amounts of not yet due Monthly Amounts, commencing with the Monthly Amount next payable and then Monthly Amounts thereafter in chronological order. Any Principal Amount, together with such accrued and unpaid interest and such any other amounts, collectively, sum arising under the "MONTHLY AMOUNT"Asset Purchase Agreement and any agreements entered into in connection therewith (the “Transaction Documents”) ; provided that, following a release of an amount of funds from the Restricted Account (as defined in the Restricted Account Agreement) for the purposes set forth in the Restricted Account Side Letter (other than with respect to a release that occurs as a result of a conversion of any Principal Amount represented by funds contained in the Restricted Account) (each, a "RELEASE AMOUNT") each Monthly Principal Amount due on any Repayment Date following any such release shall be increased by an amount equal to (x) such Release Amount divided by (y) the sum of (I) the number of Repayment Dates remaining until the Maturity Date plus (II) one (1). Any Amortizing Principal Amount that remains outstanding on the Maturity Date shall be due and payable on the Maturity Date.