<PAGE>

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

                          COMMON STOCK PURCHASE WARRANT

            To Purchase ___________________ Shares of Common Stock of

                               Home Director, Inc.

            THIS COMMON STOCK PURCHASE WARRANT CERTIFIES that, for value
received, Spencer Trask Ventures, Inc. (the "Holder"), is entitled, upon the
terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after ________, 2003 (the "Initial Exercise Date")
and on or prior to the close of business on the fifth anniversary of the Initial
Exercise Date (the "Termination Date") but not thereafter, to subscribe for and
purchase from Home Director, Inc., a Delaware corporation (the "Company"), up to
______________ shares (the "Warrant Shares") of Common Stock, par value $.001
per share, of the Company (the "Common Stock"). The purchase price of one share
of Common Stock (the "Exercise Price") under this Warrant shall be $_____
subject to adjustment hereunder. The Exercise Price and the number of Warrant
Shares for which the Warrant is exercisable shall be subject to adjustment as
provided herein. Capitalized terms used and not otherwise defined herein shall
have the meanings set forth in those certain Subscription Agreement(s) (the
"Subscription Agreement"), dated _________________, 2003, between the Company
and the signatories thereto.

<PAGE>

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

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

            3. Exercise of Warrant.

                  (a) Except as provided in Section 4 herein, exercise of the
      purchase rights represented by this Warrant may be made at any time or
      times on or after the Initial Exercise Date and on or before the
      Termination Date by the surrender of this Warrant and the Notice of
      Exercise Form annexed hereto duly executed, at the office of the Company
      (or such other office or agency of the Company as it may designate by
      notice in writing to the registered Holder at the address of such Holder
      appearing on the books of the Company) and upon payment of the Exercise
      Price of the shares thereby purchased by wire transfer or cashier's check
      drawn on a United States bank or by means of a cashless exercise pursuant
      to Section 3(c), the Holder shall be entitled to receive a certificate for
      the number of Warrant Shares so purchased. Certificates for shares
      purchased hereunder shall be delivered to the Holder within three (3)
      Trading Days after the date on which this Warrant shall have been
      exercised as aforesaid. This Warrant shall be deemed to have been
      exercised and such certificate or certificates shall be deemed to have
      been issued, and Holder or any other person so designated to be named
      therein shall be deemed to have become a holder of record of such shares
      for all purposes, as of the date the Warrant has been exercised by payment
      to the Company of the Exercise Price and all taxes required to be paid by
      the Holder, if any, pursuant to Section 5 prior to the issuance of such
      shares, have been paid. If the Company fails to deliver to the Holder a
      certificate or certificates representing the Warrant Shares pursuant to
      this Section 3(a) by the third Trading Day after the date of exercise,
      then the Holder will have the right to rescind such exercise.

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


                                       2
<PAGE>

                  (c) This Warrant may also be exercised, at any time prior to
      the Termination Date, by means of a "cashless exercise" in which the
      Holder shall be entitled to receive a certificate for the number of
      Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by
      (A), where:

           (A)  = the closing bid price on the trading day preceding
                  the date of such election;

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

           (X)  = the number of Warrant Shares issuable upon exercise
                  of the Warrants in accordance with the terms of this
                  Warrant.

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

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

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

            7. Transfer, Division and Combination.

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


                                       3
<PAGE>

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

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

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

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

            8. No Rights as Shareholder until Exercise. This Warrant does not
entitle the Holder to any voting rights or other rights as a shareholder of the
Company prior to the exercise hereof. Upon the surrender of this Warrant and the
payment of the aggregate Exercise Price (or by means of a cashless exercise),
the Warrant Shares so purchased shall be and be deemed to be issued to such
Holder as the record owner of such shares as of the close of business on the
later of the date of such surrender or payment.

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

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


                                       4
<PAGE>

            11. Adjustments of Exercise Price and Number of Warrant Shares.

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

            (b) Exercise Price Adjustment. (i) If and whenever the Company
issues or sells, or is deemed to have issued or sold, any Additional Shares of
Common Stock for an effective consideration per share of less than the then
Exercise Price or for no consideration (such lower price, the "Base Share Price"
and such issuances collectively, a "Dilutive Issuance"), then, the Exercise
Price shall be multiplied by a fraction of which the numerator shall be the
number of shares of Common Stock Outstanding immediately prior to the Dilutive
Issuance plus the number of shares of Common Stock which the aggregate offering
price for such Dilutive Issuance (assuming receipt by the Company in full of all
consideration payable upon exercise of such rights, options or warrants) would
purchase at the Exercise Price, and the denominator of which shall be the sum of
the number of shares of Common Stock Outstanding immediately prior to the
Dilutive Issuance plus the number of shares of Common Stock so issued or
issuable in connection with the Dilutive Issuance; provided, that for purposes
hereof, all shares of Common Stock that are issuable upon conversion, exercise
or exchange of Capital Share Equivalents shall be deemed outstanding immediately
after the issuance of such Common Stock. Such adjustment shall be made whenever
such shares of Common Stock or Capital Share Equivalents are issued. For
purposes of this Section 11(b), "Common Stock Outstanding" as of a given date
shall be the number of shares of Common Stock (excluding treasury shares, if
any) issued and outstanding. Upon each adjustment of the Exercise Price pursuant
to the provisions of this Section 11(b), the number of Warrant Shares issuable
upon the exercise of this Warrant shall be adjusted to the nearest full amount
by multiplying a number equal to the Exercise Price in effect immediately prior
to such adjustment by the number of Warrant Shares issuable upon exercise of the
Warrants immediately prior to such adjustment and dividing the product so
obtained by the adjusted Exercise Price.


                                       5
<PAGE>

            (c)   As used herein:

                  "Additional Shares of Common Stock" shall mean all shares of
                  Common Stock issued or deemed to be issued by the Company
                  after the date hereof which represent a Dilutive Issuance. If
                  the Company issues any Options or Convertible Securities (as
                  hereinafter defined), the maximum number of shares of Common
                  Stock issuable thereunder, shall be deemed to be Additional
                  Shares of Common Stock issued as of the time of such issue, if
                  the consideration per share of such Additional Shares of
                  Common Stock (as hereinafter determined) is less than
                  then-applicable Exercise Price, until such time as such
                  Options or Convertible Securities shall terminate or be
                  exercised or converted into Common Stock, upon which time the
                  number of shares of Common Stock actually thereupon issued
                  shall be deemed to be Additional Shares of Common Stock. The
                  Company shall be deemed to have issued the maximum number of
                  shares of Common Stock potentially underlying any Options or
                  Convertible Securities. Notwithstanding the foregoing, no
                  issuance or deemed issuance nor Common Stock or options or
                  warrants to purchase Common Stock issued to (i) officers,
                  directors or employees of or consultants to the Company
                  pursuant to any compensation agreement, plan or arrangement or
                  the issuance of Common Stock upon the exercise of any such
                  options or warrants, provided such securities were issued
                  prior to the date hereof or pursuant to a stock option plan
                  that was approved by the board of directors (ii) upon
                  conversion of existing convertible securities outstanding as
                  of the date hereof; (iii) upon exercise of outstanding
                  warrants existing as of the date hereof or this warrant; and
                  (iv) an institution or bank lender in connection with a loan
                  transaction or equipment lease,

                  shall be deemed the issuance of Additional Shares of Common
                  Stock.

                  "Options" shall mean rights, options or warrants to subscribe
                  for, purchase or otherwise acquire either Common Stock or
                  Convertible Securities.

                  "Convertible Securities" shall mean any evidences of
                  indebtedness, shares (other than Common Stock) or other
                  securities directly or indirectly convertible into or
                  exchangeable for Common Stock.

                  With respect to Options and Convertible Securities,
                  "Consideration" per share of Additional Shares of Common Stock
                  shall be determined by adding (x) the aggregate consideration
                  received upon issuance of the Options or Convertible
                  Securities divided by the number of shares receivable upon the
                  exercise or conversion thereof and (y) the minimum possible
                  consideration per share received per share upon the exercise,
                  conversion or exchange of such Options or Convertible
                  Securities for shares of Common Stock.


                                       6
<PAGE>

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

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

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


                                       7
<PAGE>

            15. Notice of Corporate Action. If at any time:

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

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

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

then, in any one or more of such cases (but not in such cases if the rights of
the Holder or holders of Common Stock will not be materially affected thereby,
as for example in the case of a merger to effect a change of domicile), the
Company shall give to Holder (i) at least 20 days' prior written notice of the
date on which a record date shall be selected for such dividend, distribution or
right or for determining rights to vote in respect of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
liquidation or winding up, and (ii) in the case of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
dissolution, liquidation or winding up, at least 20 days' prior written notice
of the date when the same shall take place. Such notice in accordance with the
foregoing clause also shall specify (i) the date on which any such record is to
be taken for the purpose of such dividend, distribution or right, the date on
which the holders of Common Stock shall be entitled to any such dividend,
distribution or right, and the amount and character thereof, and (ii) the date
on which any such reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up is to take place
and the time, if any such time is to be fixed, as of which the holders of Common
Stock shall be entitled to exchange their Warrant Shares for securities or other
property deliverable upon such disposition, dissolution, liquidation or winding
up. Each such written notice shall be sufficiently given if addressed to Holder
at the last address of Holder appearing on the books of the Company and
delivered in accordance with Section 17(d).

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


                                       8
<PAGE>

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

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

            17. Miscellaneous.

                  (a) Jurisdiction. This Warrant shall constitute a contract
      under the laws of New York, without regard to its conflict of law,
      principles or rules.

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

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

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

                  (e) Limitation of Liability. No provision hereof, in the
      absence of any affirmative action by Holder to exercise this Warrant or
      purchase Warrant Shares, and no


                                       9
<PAGE>

      enumeration herein of the rights or privileges of Holder, shall give rise
      to any liability of Holder for the purchase price of any Common Stock or
      as a stockholder of the Company, whether such liability is asserted by the
      Company or by creditors of the Company.

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

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

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

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

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

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


                                       10
<PAGE>

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

Dated:  December ___, 2003
                                HOME DIRECTOR, INC.


                                By:____________________________________________
                                   Name: Daryl Stemm
                                   Title: Chief Financial Officer and Secretary


                                       11
<PAGE>

                               NOTICE OF EXERCISE

To: Home Director, Inc.

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

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

                           |_| in lawful money of the United States; or

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

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

                           Name:
                                      ------------------------------------------
                           Address:
                                      ------------------------------------------

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

                           SS or Tax
                           ID number:
                                      ------------------------------------------

The Warrant Shares shall be delivered to the following:

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

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

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

                                               [Warrant holder]

                                               By:
                                                  ------------------------------
                                                     Name:
                                                     Title:

                                               Dated:
                                                     ---------------------------

<PAGE>

                                 ASSIGNMENT FORM

                   (To assign the foregoing warrant, execute
                   this form and supply required information.
                 Do not use this form to exercise the warrant.)

            FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced
thereby are hereby assigned to

________________________________________________whose address is

_______________________________________________________________.

_______________________________________________________________

                                                   Dated:________________, _____

                           Holder's Signature:    ______________________________

                           Holder's Address:      ______________________________

                                                  ______________________________

Signature Guaranteed:  ___________________________________________

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