THIS DEBENTURE AND THE SHARES PURCHASABLE HEREUNDER HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.
NEITHER THIS DEBENTURE NOR SUCH SHARES MAY BE SOLD OR TRANSFERRED IN THE ABSENCE
OF SUCH REGISTRATION IN EFFECT UNDER SUCH ACT UNLESS THE COMPANY RECEIVES AN
OPINION OF COUNSEL OR OTHER EVIDENCE REASONABLY ACCEPTABLE TO IT DEMONSTRATING
THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS
DELIVERY REQUIREMENTS OF SAID ACT OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH
ACT.

THE PRINCIPAL AMOUNT REPRESENTED BY THIS DEBENTURE AND, ACCORDINGLY, THE
SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS THAN THE AMOUNTS SET
FORTH ON THE FACE HEREOF PURSUANT TO SECTION 1 OF THIS DEBENTURE.

0% SUBORDINATED MANDATORY CONVERTIBLE DEBENTURE

US$1,500,000 
March 17, 2006
   

FOR VALUE RECEIVED, BARNABUS ENERGY, INC., a Nevada corporation (the “Company”
or the “Corporation”), hereby unconditionally promises to pay to the order of
Eversource Group Limited or assigns (the “Registered Holder”), at such address
or at such other place as may be designated in writing by the Registered Holder,
the aggregate principal sum of ONE MILLION FIVE HUNDRED THOUSAND DOLLARS
($1,500,000), without interest (this “Debenture”). Subject to the other
provisions of this Debenture, the principal of this Debenture shall mature and
become due and payable in full on July 31, 2008 (the “Maturity Date”). All
payments of principal by the Company under this Debenture shall be made in
United States dollars to an account specified by the Registered Holder to the
Company in writing prior to the Maturity Date. This Debenture is being issued
pursuant to the Investment Agreement of even date herewith between the Company,
the initial Registered Holder and the other purchasers named on the signature
page thereto(the “Investment Agreement”). Capitalized terms used and not
otherwise defined herein shall have the meanings given such terms in the
Investment Agreement
 
THE PRINCIPAL AMOUNT REPRESENTED BY THIS DEBENTURE AND, ACCORDINGLY, THE
SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS THAN THE AMOUNTS SET
FORTH ON THE FACE HEREOF PURSUANT TO SECTION 1 OF THIS DEBENTURE.
 

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1. CONVERSION.
 
(a) By the Registered Holder. This Debenture may be converted by the Registered
Holder on or before the Maturity Date, in whole or in part, into that number of
shares of Common Stock equal to the principal amount of this Debenture (or the
portion being converted) divided by the Conversion Price then in effect (the
“Conversion Shares”) by surrendering this Debenture, with the purchase form
appended hereto as Exhibit I duly executed by the Registered Holder at the
principal executive offices of the Company, or at such other office or agency as
the Company may designate.
 
Each conversion of this Debenture pursuant to this paragraph (a) shall be deemed
to have been effected immediately prior to the close of business on the day on
which this Debenture shall have been surrendered to the Company as provided
above. At such time, the person or persons in whose name or names any
certificates for Conversion Shares shall be issuable upon such conversion as
provided below shall be deemed to have become the holder or holders of record of
the Conversion Shares represented by such certificates.
 
As soon as practicable after the conversion of this Debenture in full or in
part, the Company, at its expense, will cause to be issued in the name of, and
delivered to, the Registered Holder, or as such Registered Holder (upon payment
by such Registered Holder of any applicable transfer taxes) may direct:
 
(i) a certificate or certificates for the number of Conversion Shares to which
the Registered Holder shall be entitled upon such conversion; and
 
(ii) in case such conversion is in part only, a new Debenture or Debentures
(dated the date hereof) of like tenor, in principal amount equal to the
principal amount hereof less the amount that has been converted into Conversion
Shares.
 
(b) By the Company. This Debenture may be converted by the Company, in whole but
not in part, by giving notice thereof to the Registered Holder on any Trading
Day if (i) the VWAP for the twenty (20) consecutive Trading Days ended on the
Trading Day before the Trading Day on which notice of conversion is given is at
least $4.00 per share (which per share amount shall be adjusted pro rata in the
case of any split, dividend, combination or other event affecting the number of
outstanding shares of Common Stock), and (ii) a registration statement covering
the resale of the Conversion Shares was effective during such 20-Trading Day
period and remains effective on the date of such notice. Upon the Company's
giving notice in accordance with the preceding sentence, this Debenture shall
without further action be converted into that number of Conversion Shares equal
to the outstanding principal amount hereof divided by the Conversion Price then
in effect. Each conversion of this Debenture pursuant to this paragraph (b)
shall be deemed to have occurred immediately prior to the close of business on
the day on which notice of conversion is given as provided above. At such time,
the person or persons in whose name or names any certificates for Conversion
Shares shall be issuable upon such conversion shall be deemed to have become the
holder or holders of record of the Conversion Shares represented by such
certificates.
 
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As soon as practicable after the conversion of this Debenture the Company, at
its expense, will cause to be issued in the name of, and delivered to, the
Registered Holder, or as such Registered Holder (upon payment by such Registered
Holder of any applicable transfer taxes) may direct a certificate or
certificates for the number of Conversion Shares to which the Registered Holder
shall be entitled upon such conversion.
 
(c) Conversion Price. As used herein, the Conversion Price shall initially be
$1.46 and from time to time shall be such amount as adjusted as provided herein.
 
2. ADJUSTMENTS.
 
(a) Adjustment for Stock Splits and Combinations. If the Company shall at any
time or from time to time after the date on which this Debenture was first
issued (the “Original Issue Date”) effect a subdivision of the outstanding
Common Stock, the Conversion Price shall be proportionately decreased. If the
Company shall at any time or from time to time after the Original Issue Date
combine the outstanding shares of Common Stock, the Conversion Price shall be
proportionately increased. Any adjustment under this paragraph shall become
effective at the close of business on the date the subdivision or combination
becomes effective.
 
(b) Adjustments for Other Dividends and Distributions. In the event the Company
at any time or from time to time after the Original Issue Date shall make or
issue, or fix a record date for the determination of holders of Common Stock
entitled to receive, a dividend or other distribution payable in securities of
the Company or in cash or other property, then and in each such event the
Registered Holder shall receive upon conversion hereof, in addition to the
Conversion Shares issuable hereunder, the kind and amount of securities of the
Company and/or cash and other property which the Registered Holder would have
been entitled to receive had this Debenture been converted on the date of such
event.
 
(c) Adjustment for Mergers or Reorganizations, etc. If there shall occur any
reclassification, reorganization, recapitalization, consolidation, sale of all
or substantially all assets or merger involving the Company in which the Common
Stock is converted into or exchanged for securities, cash or other property
(other than a transaction covered by subsection 2(b) above), then, following any
such reclassification, reorganization, recapitalization, consolidation, sale of
all or substantially all assets or merger, and without payment of any additional
consideration thereof, the Registered Holder shall receive upon conversion
hereof the kind and amount of securities, cash or other property which the
Registered Holder would have been entitled to receive if, immediately prior to
such reclassification, reorganization, recapitalization, consolidation or
merger, sale of all or substantially all assets, this Debenture had been
converted.
 
The foregoing provisions of this Section 2(c) shall similarly apply to
successive reorganizations, consolidations, mergers, sales and transfers and to
the stock or securities of any other corporation that are at the time receivable
upon the conversion of this Debenture. If the per share consideration payable to
the holder hereof for Conversion Shares in connection with any such transaction
is in a form other than cash or marketable securities, then the value of such
consideration shall be determined in good faith by the Company’s Board of
Directors. In all events, appropriate adjustment (as determined in good faith by
the Company’s Board of Directors) shall be made in the application of the
provisions of this Debenture with respect to the rights and interests of the
Holder after the transaction, to the end that the provisions of this Debenture
shall be applicable after that event, as near as reasonably may be, in relation
to any shares or other property deliverable after that event upon conversion of
this Debenture.
 
-3-

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(d) Subsequent Issuances. Except for Excluded Issuances, if and whenever the
Corporation shall issue or sell any shares of Common Stock for a consideration
per share less than the Conversion Price in effect immediately prior to the time
of such issue or sale, then and in each such case (a “Trigger Issuance”) the
then-existing Conversion Price shall be reduced, as of the close of business on
the effective date of the Trigger Issuance, to the lowest per share price at
which such Additional Shares of Common Stock were issued or sold.
 
In case at any time the Corporation shall in any manner grant (directly and not
by assumption in a merger or otherwise) any Warrants or other rights to
subscribe for or to purchase, or any options for the purchase of, Common Stock
or any stock or security convertible into or exchangeable for Common Stock (such
Warrants, rights or options being called “Options” and such convertible or
exchangeable stock or securities being called “Convertible Securities”), whether
or not such Options or the right to convert or exchange any such Convertible
Securities are immediately exercisable, and the price per share for which Common
Stock is issuable upon the exercise of such Options or upon the conversion or
exchange of such Convertible Securities (determined by dividing (A) the sum of
(x) the total amount, if any, received or receivable by the Company as
consideration for the granting of such Options or Convertible Securities, plus
(y) the aggregate amount of additional consideration payable to the Company upon
the conversion of all such Options or the aggregate amount of additional
consideration, if any, payable upon the conversion or exchange of such
Convertible Securities, by (B) the total maximum number of shares of Common
Stock issuable upon the exercise of such Options or upon the conversion or
exchange of all such Convertible Securities) shall be less than the Conversion
Price in effect immediately prior to the time of the granting of such Options or
Convertible Securities, then the Conversion Price shall be adjusted to equal the
price at which Common Stock is issuable upon such conversion or conversion or
exercise. No adjustment of the Conversion Price shall be made upon the actual
issue of such Common Stock upon exercise of such Options or upon the actual
conversion or exchange of such Convertible Securities.
 
In case any shares of Common Stock, Options or Convertible Securities shall be
issued or sold for cash, the consideration received therefor shall be deemed to
be the amount received by the Company therefor, without deduction therefrom of
any expenses incurred or any underwriting commissions or concessions paid or
allowed by the Corporation in connection therewith. In case any shares of Common
Stock, Options or Convertible Securities shall be issued or sold for a
consideration other than cash or for a consideration including cash and such
other consideration, the amount of the consideration other than cash received by
the Corporation shall be deemed to be the fair value of such consideration as
determined in good faith by the Board, without deduction of any expenses
incurred or any underwriting commissions or concessions paid or allowed by the
Company in connection therewith. In case any Options shall be issued in
connection with the issue and sale of other securities of the Company, together
comprising one integral transaction in which no specific consideration is
allocated to such Options by the parties thereto, such Options shall be deemed
to have been issued for such consideration as determined in good faith by the
Board. This determination of the fair value of consideration (or the allocation
thereof) need not be the amount recorded in the books and records of the Company
if the Board determines that the determination of different amounts for
different contexts is in the best interest of the Company and its stockholders
and creditors as a whole.
 
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As used herein, “Excluded Issuances” shall mean any issuance of Common Stock (A)
to directors, officers, employees or consultants of the Company, (B) upon the
conversion or conversion of Options or Convertible Securities issued prior to
the date hereof, unless such securities have been amended or modified in any
manner after the date hereof, (C) pursuant to the Investment Agreement and other
agreements in effect on the date hereof and securities issued upon the
conversion or conversion of those securities, (D) by reason of a dividend, stock
split or other distribution on shares of Common Stock; (E) to David Saltman or
Cheryl Bostater pursuant to the terms of their employment agreements; and (F) in
connection with the acquisition of a business or technology, the formation of a
joint venture or a strategic investment.
 
(e) Milestone Adjustments. The Conversion Price shall be adjusted as, when and
to the extent provided in this paragraph (e); provided, however, no further
adjustments to the Conversion Price shall be made pursuant to this paragraph (e)
with respect to any fiscal quarter ended after November 30, 2006 if: (x) there
was no Milestone Failure with respect to the fiscal quarter ended November 30,
2006; and (y) the VWAP for any twenty (20) consecutive Trading Days after the
Milestone Announcement Date with respect to the fiscal quarter ended November
30, 2006 is at least $4.00 per share (which per share amount shall be adjusted
pro rata in the case of any split, dividend, combination or other event
affecting the number of outstanding shares of Common Stock). Upon each Milestone
Failure Date, the Conversion Price in effect on such Milestone Failure Date
shall, at the election of the Registered Holder, be decreased to the VWAP for
the five (5) Trading Days immediately following such Milestone Failure Date
multiplied by the Designated Discount Rate applicable to such Milestone Failure
as set forth in the Milestone table below. With respect to each fiscal quarter
ended after a Milestone Failure Date, if the cumulative Net Sales through such
fiscal quarter ended exceed the cumulative Milestones through such fiscal
quarter, then all prior adjustments to this paragraph (e) shall be reversed. For
purposes of this Debenture, the following terms shall have the following
meanings:
 

(i) “Milestone” means, with respect to a given fiscal quarter, the dollar amount
of Net Sales for such fiscal quarter, as set forth in the table immediately
below:
 

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Milestones
Fiscal
Milestone
Designated
Quarter Ended
Threshold
Discount Rate
     
February 28, 2006
$100,000
75%
May 31, 2006
$1,400,000
75%
August 31, 2006
$4,500,000
80%
November 30, 2006
$8,000,000
80%
February 28, 2007
$9,000,000
85%
May 31, 2007
$12,000,000
85%
August 31, 2007
$15,000,000
90%
November 30, 2007
$18,000,000
90%

 
(ii) “Milestone Announcement Date” shall mean, with respect to each fiscal
quarter ended during 2006 and 2007, the date on which the Company files the
Periodic Report applicable to such quarter; it being understood if the Company
amends any such Periodic Report after its initial filing, then all calculations,
determinations and adjustments, if any, under this Debenture with respect to the
fiscal quarter for which such Periodic Report was filed shall, upon the filing
of such amendment, be re-calculated, re-determined and re-adjusted, if
applicable, as though the information contained in such amendment were contained
in the original filing.
 
(iii) “Milestone Failure” shall be deemed to occur, with respect to a fiscal
quarter specified in the table contained in the definition of the term
“Milestone”, if the Net Sales for such fiscal quarter do not exceed the
Milestone for such fiscal quarter, as reported in the applicable Periodic
Report.
 
(iv) “Milestone Failure Date” shall mean a Milestone Announcement Date on which
a Milestone Failure is deemed to occur.
 
(v) “Net Sales” means the revenues generated in the ordinary course of business
by the Company, determined in accordance with GAAP, as reported in the Company’s
applicable Periodic Report.
 
(vi) “Periodic Report” shall mean the quarterly report on Form 10-Q, 10-QSB or
such other form the Company is then eiligible to use, or, in the case of the
fourth fiscal quarter of a given fiscal year, the annual report on Form 10-K,
10-KSB or such other form the Company is then eligible to use, in each case,
filed by the Company with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act.
 
(vii) “Trading Day” shall mean a day, other than a Saturday or Sunday, on which
The New York Stock Exchange, Inc. is open for trading.
 
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(viii) “VWAP” means, with respect to a period of specified Trading Days, the
volume weighted average price per share of the Common Stock measured over each
of the days during such period, which shall be equal to the average of the
quotient(s) for each Trading Day during such period of (x) the aggregate dollar
amount of Common Stock traded (i.e., the sale prices multiplied by the number of
shares traded) for such Trading Day, divided by (y) the total number of shares
of Common Stock traded during such Trading Day.
 
(f) Certificate as to Adjustments. Upon the occurrence of each adjustment or
readjustment pursuant to this Section 2, the Company at its expense shall
promptly compute such adjustment or readjustment in accordance with the terms
hereof and furnish to the Registered Holder a certificate setting forth such
adjustment or readjustment (including the kind and amount of securities, cash or
other property for which this Debenture shall be exercisable, the Conversion
Price and the method of calculation of each) and showing in detail the facts
upon which such adjustment or readjustment is based.
 
(g) Adjustment to Conversion Shares. Whenever the Conversion Price is adjusted
pursuant to this Section 2, there shall be a corresponding adjustment made to
the number of Conversion Shares upon conversion hereof.
 
3. FRACTIONAL SHARES. The Company shall not be required upon the conversion of
this Debenture to issue any fractional shares, and shall round any fractional
shares to the next highest whole number of shares. If a fractional share
interest arises upon any conversion or conversion of the Debenture, the Company
shall eliminate such fractional share interest by paying the Registered Holder
an amount computed by multiplying the fractional interest by the Fair Market
Value of a full share of common Stock.
 
The “Fair Market Value” per share of Common Stock shall be determined as
 
(i) if the Common Stock is listed on a national securities exchange, the NASDAQ
Small Cap Market, the NASDAQ National Market, the OTCBB or another nationally
recognized trading system as of the Conversion Date, the Fair Market Value per
share of Common Stock shall be deemed to be the average of the high and low
reported sale prices per share of Common Stock thereon on the trading day
immediately preceding the Conversion Date (provided that if no such price is
reported on such day, the Fair Market Value per share of Common Stock shall be
determined pursuant to clause (ii)).
 
(ii) In all other cases, the Fair Market Value per share of Common Stock shall
be deemed to be the amount most recently determined by the Board of Directors to
represent the fair market value per share of the Common Stock. Notwithstanding
the foregoing, if the Board of Directors has not made such a determination
within the three-month period prior to the Conversion Date, then (A) the Board
of Directors shall make a determination of the Fair Market Value per share of
the Common Stock within 20 days of a request by the Registered Holder that it do
so, and (B) the conversion of this Debenture pursuant to this subsection 1(b)
shall be delayed until such determination is made.
 
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4. REPRESENTATIONS AND WARRANTIES BY THE REGISTERED HOLDER. The Registered
Holder represents and warrants to the Company that upon each conversion hereof,
the Registered Holder affirms to the Company that the representations and
Debenturies contained in Sections 4.01 and 4.04 through 4.08 of the Investment
Agreement are true and correct as if made by the Registered Holder on the date
of conversion.
 
5. REQUIREMENTS FOR TRANSFER.
 
(a) This Debenture and the Conversion Shares shall not be sold or transferred
unless either (i) they first shall have been registered under the Act and under
applicable state securities or blue sky laws, or (ii) the Company first shall
have been furnished with an opinion of legal counsel, reasonably satisfactory to
the Company, to the effect that such sale or transfer is exempt from the
registration requirements of the Act.
 
(b) Each certificate representing Conversion Shares shall bear a legend
substantially in the following form:
 
“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT
AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH SHARES MAY
NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION IN EFFECT UNDER
SUCH ACT UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL OR OTHER EVIDENCE
REASONABLY ACCEPTABLE TO IT DEMONSTRATING THAT SUCH SALE OR TRANSFER IS EXEMPT
FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT OR UNLESS
SOLD PURSUANT TO RULE 144 OF SUCH ACT.
 
The foregoing legend shall be removed from the certificates representing any
Conversion Shares, at the request of the holder thereof, at such time as
(i) they become eligible for resale pursuant to an effective registration
statement or Rule 144(k) under the Act or (ii) the Company shall have received
either an opinion of counsel or a “no-action” letter from the SEC to the effect
that any transfer of the Conversion Shares represented by such certificates will
not violate the Act and applicable state securities laws.
 
6. EVENT OF DEFAULT. The occurrence of any of following events shall constitute
an “Event of Default” hereunder:
 
(a) the failure of the Corporation to make any payment of principal on this
Debenture when due, whether at maturity, upon acceleration or otherwise; or
 
(b) the Corporation makes an assignment for the benefit of creditors or admits
in writing its inability to pay its debts generally as they become due; or an
order, judgment or decree is entered adjudicating the Corporation as bankrupt or
insolvent; or any order for relief with respect to the Corporation is entered
under the Federal Bankruptcy Code or any other bankruptcy or insolvency law; or
the Corporation petitions or applies to any tribunal for the appointment of a
custodian, trustee, receiver or liquidator of the Corporation or of any
substantial part of the assets of the Corporation, or commences any proceeding
relating to it under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation law of any jurisdiction; or any
such petition or application is filed, or any such proceeding is commenced,
against the Corporation and either (i) the Corporation by any act indicates its
approval thereof, consents thereto or acquiescence therein or (ii) such petition
application or proceeding is not dismissed within sixty (60) days.
 
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Upon the occurrence of any such Event of Default all unpaid principal under this
Debenture shall become immediately due and payable.
 
7. NO IMPAIRMENT. The Company will not, by amendment of its charter through
reorganization, transfer of assets, consolidation, merger, dissolution, issuance
or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Debenture, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the holder of this Debenture against impairment.
 
8. NOTICES OF RECORD DATE, ETC. In the event:
 
(a) that the Company shall take a record of the holders of its Common Stock (or
other stock or securities at the time deliverable upon the conversion of this
Debenture) for the purpose of entitling or enabling them to receive any dividend
or other distribution, or to receive any right to subscribe for or purchase any
shares of stock of any class or any other securities, or to receive any other
right; or
 
(b) of any capital reorganization of the Company, any reclassification of the
Common Stock of the Company, any consolidation or merger of the Company with or
into another corporation (other than a consolidation or merger in which the
Company is the surviving entity and its Common Stock is not converted into or
exchanged for any other securities or property), or any transfer of all or
substantially all of the assets of the Company; or
 
(c) of the voluntary or involuntary dissolution, liquidation or winding-up of
the Company, then, and in each such case, the Company will mail or cause to be
mailed to the Registered Holder a notice specifying, as the case may be, (i) the
record date for such dividend, distribution or right, and the amount and
character of such dividend, distribution or right, or (ii) the effective date on
which such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up is to take place, and the time, if any is
to be fixed, as of which the holders of record of Common Stock (or such other
stock or securities at the time deliverable upon the conversion of this
Debenture) shall be entitled to exchange their shares of Common Stock (or such
other stock or securities) for securities or other property deliverable upon
such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up. Such notice shall be mailed at least ten
days prior to the record date or effective date for the event specified in such
notice.
 
9. STOCK FULLY PAID, RESERVATION OF STOCK. All of the Conversion Shares issuable
upon the conversion of the rights represented by this Debenture will, upon
issuance and receipt of the purchase price therefor, be validly issued, fully
paid and nonassessable, and free from all taxes, liens and charges except for
restrictions on transfer provided for herein or under applicable federal and
state securities laws. The Company will at all times reserve and keep available,
solely for issuance and delivery upon the conversion of this Debenture, such
number of shares of Common Stock and other securities, cash and/or property, as
from time to time shall be issuable upon the conversion of this Debenture.
 
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10. REPLACEMENT OF DEBENTURES. Upon receipt of evidence reasonably satisfactory
to the Company of the loss, theft, destruction or mutilation of this Debenture
and (in the case of loss, theft or destruction) upon delivery of an indemnity
agreement (without any obligation for a surety or other security therefor) in an
amount reasonably satisfactory to the Company, or (in the case of mutilation)
upon surrender and cancellation of this Debenture, the Company will issue, in
lieu thereof, a new Debenture of like tenor.
 
11. TRANSFERS, ETC.
 
(a) The Company will maintain a register containing the name and address of the
Registered Holder of this Debenture. The Registered Holder may change its or his
address as shown on the Debenture register by written notice to the Company
requesting such change.
 
(b) This Debenture and all rights hereunder are transferable, in whole or in
part, upon surrender of this Debenture with a properly executed assignment in a
form reasonably acceptable to the Company at the principal executive offices of
the Company.
 
(c) Until any transfer of this Debenture is made in the Debenture register, the
Company may treat the Registered Holder as the absolute owner hereof for all
purposes; provided, however, that if and when this Debenture is properly
assigned in blank, the Company may (but shall not be obligated to) treat the
bearer hereof as the absolute owner hereof for all purposes, notwithstanding any
notice to the contrary.
 
12. MAILING OF NOTICES, ETC. All notices and other communications from the
Company to the Registered Holder shall be mailed by first-class certified or
registered mail, postage prepaid, to the address last furnished to the Company
in writing by the Registered Holder. All notices and other communications from
the Registered Holder or in connection herewith to the Company shall be mailed
by first-class certified or registered mail, postage prepaid, to the Company at
its principal executive office. If the Company should at any time change the
location of its principal executive office to a place other than as set forth
below, it shall give prompt written notice to the Registered Holder and
thereafter all references in this Debenture to the location of its principal
executive office at the particular time shall be as so specified in such notice.
 
13. NO RIGHTS AS STOCKHOLDER. Until the conversion of this Debenture, the
Registered Holder shall not have or conversion any rights by virtue hereof as a
stockholder of the Company.
 
14. CHANGE OR WAIVER. Any term of this Debenture may be amended or waived upon
the written consent of the Company and the Registered Holder.
 
15. SECTION HEADINGS. The Section headings in this Debenture are for the
convenience of the parties and in no way alter, modify, amend, limit or restrict
the contractual obligations of the parties.
 
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16. GOVERNING LAW. This Debenture will be governed by and construed in
accordance with the internal laws of the State of Nevada without giving effect
to the conflict or choice of law provision thereof that would give rise the
application of the domestic substantive law of any other jurisdiction.
 
EXECUTED as of the Date of Issuance indicated above.
 

        BARNABUS ENERGY, INC.  
   
   
    By:      

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Name: David Saltman
Title: President
   

 

 
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EXHIBIT I

PURCHASE FORM
 

To: Barnabus Energy, Inc. (the “Company”)
 Dated: ____________

 
The undersigned, pursuant to the provisions set forth in the attached Debenture,
hereby irrevocably elects to purchase shares of the Common Stock covered by such
Debenture.
 
The undersigned herewith elects to convert $__________ in principal amount of
such Debenture at the Conversion Price provided for in such Debenture, which is
$_________.
 
Please issue a certificate representing said shares of Common Stock in the name
of the undersigned or in such other name as is specified below:
 
The undersigned affirms the representation and warranties contained in Sections
4.01 and 4.04 through 4.08 of that certain Investment Agreement dated the same
date as the attached Debenture, among the Company, the initial holder of the
attached Debenture and the other purchasers listed on the signature page
thereof.

 
Name of Entity: _______________________________________   
 

Signature of
Authorized Person: ____________________________________
 
Address: ____________________________________________
 
___________________________________________________
 
 
Date: _______________________________________________
 

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