EXHIBIT 4.2.A
                          SECURED CONVERTIBLE DEBENTURE
                               DUE APRIL __, 2006


                                                                       EXHIBIT A

NEITHER THESE  SECURITIES  NOR THE  SECURITIES  INTO WHICH THESE  SECURITIES ARE
CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE  COMMISSION OR
THE  SECURITIES  COMMISSION  OF ANY STATE IN  RELIANCE  UPON AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH  EFFECT,  THE  SUBSTANCE  OF WHICH SHALL BE  REASONABLY  ACCEPTABLE  TO THE
COMPANY.  THESE SECURITIES AND THE SECURITIES  ISSUABLE UPON CONVERSION OF THESE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.

Original Issue Date: April __, 2004
Original Conversion Price (subject to adjustment herein): $0.08

                                                                $_______________


                          SECURED CONVERTIBLE DEBENTURE
                               DUE APRIL __, 2006

         THIS  DEBENTURE  is one of a  series  of  duly  authorized  and  issued
Convertible  Debentures of Usurf America,  Inc., a Nevada corporation,  having a
principal  place of  business  at 6005  Delmonico  Drive,  Suite  140,  Colorado
Springs, Colorado, 80919 (the "Company"),  designated as its Secured Convertible
Debenture, due April __, 2006 (the "Debentures").

         FOR   VALUE    RECEIVED,    the    Company    promises    to   pay   to
________________________ or its registered assigns (the "Holder"), the principal
sum of  $_______________  on  April  ___,  2006  or  such  earlier  date  as the
Debentures  are required or permitted  to be repaid as provided  hereunder  (the
"Maturity Date"), and to pay interest to the Holder on the aggregate unconverted
and then  outstanding  principal  amount of this Debenture at the rate of 8% per
annum,  payable  quarterly  on March 31, June 30,  September 30 and December 31,
beginning  on June 30, 2004 and on each  Conversion  Date (as to that  principal
amount then being  converted) and on the Maturity Date (except that, if any such
date  is not a  Business  Day,  then  such  payment  shall  be  due on the  next
succeeding  Business Day) (each such date, an "Interest  Payment Date"), in cash
or shares of Common Stock; provided,  however, payment in shares of Common Stock
may only occur if during the 20 Trading Days immediately prior to the applicable
Interest Payment Date all of the Equity Conditions have been met and the Company
shall  have give the Holder  irrevocable  notice in  accordance  with the notice
requirements set forth below.  Subject to the terms and conditions  herein,  the
decision  whether to pay  interest  hereunder  in shares of Common Stock or cash
shall be at the  discretion of the Company.  Not less than 20 Trading Days prior
to each  Interest  Payment  Date,  the  Company  shall  provide  the Holder with
irrevocable  written notice of its election to pay interest  hereunder either in
cash or shares of Common Stock (the Company may indicate in such notice that the
election  contained  in such  notice  shall  continue  for later  periods  until
revised).  Within  20  Trading  Days  prior to an  Interest  Payment  Date,  the
Company's  election (whether specific to an Interest Payment Date or continuous)
shall  be  irrevocable  as  to  such  Interest  Payment  Date.  Subject  to  the
aforementioned  conditions,  failure to timely provide such written notice shall
be deemed an  election  by the  Company  to pay the  interest  on such  Interest


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Payment Date in cash.  Interest  shall be  calculated  on the basis of a 360-day
year and shall accrue daily  commencing on the Original Issue Date until payment
in full of the principal sum,  together with all accrued and unpaid interest and
other amounts which may become due hereunder, has been made. Payment of interest
in shares of Common  Stock shall  otherwise  occur  pursuant to Section 4(b) and
only for  purposes of the payment of interest in shares,  the  Interest  Payment
Date shall be deemed the  Conversion  Date.  Interest shall cease to accrue with
respect to any  principal  amount  converted,  provided that the Company in fact
delivers  the  Underlying  Shares  within the time  period  required  by Section
4(b)(i).  Interest  hereunder  will be paid to the  Person  in whose  name  this
Debenture is registered on the records of the Company regarding registration and
transfers of Debentures (the "Debenture Register"). Except as otherwise provided
herein, if at anytime the Company pays interest  partially in cash and partially
in shares of Common Stock, then such payment shall be distributed  ratably among
the Holders based upon the principal  amount of Debentures  held by each Holder.
All overdue accrued and unpaid interest to be paid hereunder shall entail a late
fee at the rate of 18% per  annum (or such  lower  maximum  amount  of  interest
permitted  to be charged  under  applicable  law) ("Late Fee") which will accrue
daily,  from the date such interest is due  hereunder  through and including the
date of payment.  Notwithstanding  anything to the contrary contained herein, if
on any  Interest  Payment Date the Company has elected to pay interest in Common
Stock  and is not  able to pay  accrued  interest  in the form of  Common  Stock
because  it does not then  satisfy  the  conditions  for  payment in the form of
Common Stock set forth above, then, at the option of the Holder, the Company, in
lieu of delivering  either shares of Common Stock  pursuant to this Section 4 or
paying the regularly  scheduled cash interest  payment,  shall  deliver,  within
three Trading Days of each applicable  Interest  Payment Date, an amount in cash
equal  to the  product  of the  number  of  shares  of  Common  Stock  otherwise
deliverable  to the Holder in  connection  with the payment of interest due such
Interest  Payment Date and the highest VWAP during the period  commencing on the
Interest  Payment  Date and  ending  on the  Trading  Day prior to the date such
payment is made. The Company may not prepay any portion of the principal  amount
of this Debenture without the prior written consent of the Holder.

         This Debenture is subject to the following additional provisions:

         Section  1.  This  Debenture  is  exchangeable  for an equal  aggregate
principal  amount  of  Debentures  of  different  authorized  denominations,  as
requested by the Holder  surrendering  the same. No service  charge will be made
for such registration of transfer or exchange.

         Section 2. This Debenture has been issued subject to certain investment
representations  of the original Holder set forth in the Purchase  Agreement and
may be transferred or exchanged only in compliance  with the Purchase  Agreement
and applicable  federal and state securities laws and regulations.  Prior to due
presentment to the Company for transfer of this  Debenture,  the Company and any
agent of the Company may treat the Person in whose name this  Debenture  is duly
registered  on the  Debenture  Register  as the owner  hereof for the purpose of
receiving payment as herein provided and for all other purposes,  whether or not
this  Debenture is overdue,  and neither the Company nor any such agent shall be
affected by notice to the contrary.

         Section 3. Events of Default.

                  b) "Event of Default",  wherever used herein, means any one of
         the  following  events  (whatever  the reason  and  whether it shall be
         voluntary or involuntary or effected by operation of law or pursuant to
         any  judgment,  decree or order of any  court,  or any  order,  rule or
         regulation of any administrative or governmental body):

                           i) any default in the payment of (A) the principal of
                  amount of any Debenture, or (B) interest (including Late Fees)
                  on, or  liquidated  damages in respect of, any  Debenture,  in
                  each case free of any claim of subordination,  as and when the
                  same shall  become due and payable  (whether  on a  Conversion
                  Date or the Maturity  Date or by  acceleration  or  otherwise)
                  which  default,  solely in the case of an interest  payment or
                  other default under clause (B) above, is not cured,  within 10
                  Trading Days;


<PAGE>


                           ii) the Company  shall fail to observe or perform any
                  other covenant or agreement contained in this Debenture or any
                  of the other Transaction Documents (other than a breach by the
                  Company of its  obligations  to deliver shares of Common Stock
                  to the Holder upon  conversion  which  breach is  addressed in
                  clause (xii) below) which failure is not cured, if possible to
                  cure, within the earlier to occur of (A) 10 Trading Days after
                  notice  of such  default  sent by the  Holder  or by any other
                  Holder and (B) 15 Trading Days after the Company  shall become
                  or should have become aware of such failure;

                           iii)a  default  or event of default  (subject  to any
                  grace or cure period provided for in the applicable agreement,
                  document or instrument and subject to final resolution if such
                  breach is the  subject of a  bona-fide  dispute)  shall  occur
                  under  (A) any of the  Transaction  Documents  other  than the
                  Debentures,  or  (B)  any  other  material  agreement,  lease,
                  document or instrument to which the Company or any  Subsidiary
                  is bound;

                           iv) any  representation  or warranty made herein,  in
                  any  other  Transaction  Document,  in any  written  statement
                  pursuant hereto or thereto, or in any other report,  financial
                  statement  or  certificate  made or delivered to the Holder or
                  any other holder of Debentures shall be untrue or incorrect in
                  any material respect as of the date when made or deemed made;

                           v) the  Company  or any  of  its  subsidiaries  shall
                  commence,  or there shall be commenced  against the Company or
                  any such subsidiary a case under any applicable  bankruptcy or
                  insolvency laws as now or hereafter in effect or any successor
                  thereto, or the Company or any Subsidiary  commences any other
                  proceeding under any reorganization,  arrangement,  adjustment
                  of  debt,  relief  of  debtors,  dissolution,   insolvency  or
                  liquidation or similar law of any jurisdiction  whether now or
                  hereafter in effect  relating to the Company or any subsidiary
                  thereof  or there is  commenced  against  the  Company  or any
                  subsidiary  thereof any such  bankruptcy,  insolvency or other
                  proceeding which remains  undismissed for a period of 60 days;
                  or  the  Company  or any  subsidiary  thereof  is  adjudicated
                  insolvent or  bankrupt;  or any order of relief or other order
                  approving  any such  case or  proceeding  is  entered;  or the
                  Company or any subsidiary  thereof  suffers any appointment of
                  any  custodian or the like for it or any  substantial  part of
                  its property which  continues  undischarged  or unstayed for a
                  period of 60 days;  or the Company or any  subsidiary  thereof
                  makes a general  assignment  for the benefit of creditors;  or
                  the  Company  shall  fail to pay,  or shall  state  that it is
                  unable to pay, or shall be unable to pay, its debts  generally
                  as they become due; or the Company or any  subsidiary  thereof
                  shall call a meeting of its creditors with a view to arranging
                  a composition,  adjustment or  restructuring  of its debts; or
                  the  Company  or any  subsidiary  thereof  shall by any act or
                  failure to act expressly  indicate its consent to, approval of
                  or acquiescence  in any of the foregoing;  or any corporate or
                  other action is taken by the Company or any subsidiary thereof
                  for the purpose of effecting any of the foregoing;

                           vi) the Company or any  Subsidiary  shall  default in
                  any of its obligations under any mortgage, credit agreement or
                  other facility,  indenture  agreement,  factoring agreement or
                  other instrument under which there may be issued,  or by which
                  there  may  be  secured  or  evidenced  any  indebtedness  for
                  borrowed  money or money due under  any long term  leasing  or
                  factoring  arrangement  of the Company in an amount  exceeding
                  $300,000,  whether  such  indebtedness  now  exists  or  shall
                  hereafter  be created and such  default  shall  result in such
                  indebtedness  becoming or being declared due and payable prior
                  to the  date  on  which  it  would  otherwise  become  due and
                  payable;


<PAGE>


                           vii) the  Common  Stock  shall  not be  eligible  for
                  quotation  on or quoted for trading on a Principal  Market and
                  shall  not again be  eligible  for and  quoted  or listed  for
                  trading thereon within 10 Trading Days;

                           viii) the  Company  shall be a party to any Change of
                  Control Transaction,  shall agree to sell or dispose of all or
                  in  excess of 33% of its  assets  in one or more  transactions
                  (whether or not such sale would constitute a Change of Control
                  Transaction)  or shall  redeem  or  repurchase  more than a de
                  minimis  number of its  outstanding  shares of Common Stock or
                  other equity securities of the Company (other than redemptions
                  of Underlying Shares and repurchases of shares of Common Stock
                  or other equity securities of departing officers and directors
                  of  the  Company;   provided  such  repurchases  shall  exceed
                  $250,000,  in the  aggregate,  for all officers and  directors
                  during the term of this Debenture);

                           ix) a  Registration  Statement  shall  not have  been
                  declared  effective by the Commission on or prior to the 210th
                  calendar day after the Original  Issue Date or any other Event
                  (as defined in the Registration  Rights  Agreement) shall have
                  occurred;

                           x) if, during the Effectiveness Period (as defined in
                  the Registration  Rights Agreement),  the effectiveness of the
                  Registration  Statement  lapses  for any  reason or the Holder
                  shall not be permitted to resell  Registrable  Securities  (as
                  defined  in  the  Registration  Rights  Agreement)  under  the
                  Registration  Statement,  in  either  case,  for more  than 25
                  consecutive  Trading Days or 35  non-consecutive  Trading Days
                  during any 12 month  period;  provided,  however,  that in the
                  event that the Company is negotiating a merger, consolidation,
                  acquisition or sale of all or substantially  all of its assets
                  or a similar transaction and in the written opinion of counsel
                  to the Company, the Registration Statement,  would be required
                  to  be  amended  to  include   information   concerning   such
                  transactions  or the parties  thereto that is not available or
                  may not be publicly  disclosed at the time,  the Company shall
                  be permitted an additional 15 consecutive  Trading Days during
                  any 12 month period relating to such an event;

                           xi) an Event (as defined in the  Registration  Rights
                  Agreement)  shall not have been cured to the  satisfaction  of
                  the Holder  prior to the  expiration  of thirty  days from the
                  Event Date (as defined in the Registration  Rights  Agreement)
                  relating thereto (other than an Event resulting from a failure
                  of an Registration  Statement to be declared  effective by the
                  Commission on or prior to the  Effectiveness  Date (as defined
                  in the Registration Rights Agreement),  which shall be covered
                  by Section 3(a)(vii));

                           xii) the Company shall fail for any reason to deliver
                  certificates to a Holder prior to the 10th Trading Day after a
                  Conversion  Date  pursuant to and in  accordance  with Section
                  4(b)  or the  Company  shall  provide  notice  to the  Holder,
                  including by way of public  announcement,  at any time, of its
                  intention not to comply with requests for  conversions  of any
                  Debentures in accordance with the terms hereof; or

                           (xiv)  the  Company  shall  fail  for any  reason  to
                  deliver the  payment in cash  pursuant to a Buy-In (as defined
                  herein)  within 10 days  after  notice  thereof  is  delivered
                  hereunder.


                  c) If any Event of Default occurs,  the full principal  amount
         of this  Debenture,  together  with interest and other amounts owing in
         respect  thereof,  to the date of  acceleration  shall  become,  at the
         Holder's  election,  immediately due and payable in cash. The aggregate
         amount payable upon an Event of Default shall be equal to the Mandatory
         Prepayment Amount.  Commencing 5 days after the occurrence of any Event
         of Default that results in the eventual acceleration of this Debenture,
         the interest rate on this Debenture shall accrue at the rate of 18% per
         annum, or such lower maximum amount of interest permitted to be charged
         under  applicable  law.  All  Debentures  for which the full  Mandatory
         Prepayment Amount hereunder shall have been paid in accordance herewith


<PAGE>


         shall  promptly be  surrendered  to or as directed by the Company.  The
         Holder need not provide and the Company hereby waives any  presentment,
         demand,  protest  or other  notice  of any  kind,  and the  Holder  may
         immediately and without  expiration of any grace period enforce any and
         all of its  rights  and  remedies  hereunder  and  all  other  remedies
         available to it under applicable law. Such declaration may be rescinded
         and annulled by Holder at any time prior to payment  hereunder  and the
         Holder shall have all rights as a Debenture  holder until such time, if
         any, as the full payment under this Section shall have been received by
         it. No such rescission or annulment  shall affect any subsequent  Event
         of Default or impair any right consequent thereon.

         Section 4. Conversion.

                  a) i) At any time  after the  Original  Issue  Date until this
         Debenture is no longer outstanding, this Debenture shall be convertible
         into shares of Common Stock at the option of the Holder, in whole or in
         part at any time and from time to time (subject to the  limitations  on
         conversion  set forth in Section  4(a)(ii)  hereof).  The Holder  shall
         effect  conversions  by delivering to the Company the form of Notice of
         Conversion  attached  hereto  as Annex A (a  "Notice  of  Conversion"),
         specifying  therein the principal  amount of Debentures to be converted
         and the date on which such  conversion is to be effected (a "Conversion
         Date").  If no Conversion  Date is specified in a Notice of Conversion,
         the Conversion Date shall be the date that such Notice of Conversion is
         provided hereunder.  To effect conversions hereunder,  the Holder shall
         not be  required  to  physically  surrender  Debentures  to the Company
         unless the entire  principal  amount of this Debenture plus all accrued
         and  unpaid  interest  thereon  has  been  so  converted.   Conversions
         hereunder shall have the effect of lowering the  outstanding  principal
         amount  of  this  Debenture  in  an  amount  equal  to  the  applicable
         conversion.  The Holder and the Company shall maintain  records showing
         the principal  amount converted and the date of such  conversions.  The
         Company shall deliver any objection to any Notice of Conversion  within
         1 Business Day of receipt of such  notice.  In the event of any dispute
         or  discrepancy,  the records of the Holder  shall be  controlling  and
         determinative  in the  absence of  manifest  error.  The Holder and any
         assignee, by acceptance of this Debenture,  acknowledge and agree that,
         by reason of the provisions of this paragraph,  following conversion of
         a portion  of this  Debenture,  the unpaid  and  unconverted  principal
         amount of this Debenture may be less than the amount stated on the face
         hereof.

                           ii) Conversion Limitations.

                                    (A) Reserved.

                                    (B)  The   Company   shall  not  effect  any
                           conversion  of this  Debenture,  and the Holder shall
                           not have the right to  convert  any  portion  of this
                           Debenture,  pursuant to Section 4(a)(i) or otherwise,
                           to the  extent  that  after  giving  effect  to  such
                           conversion,  the Holder  (together  with the Holder's
                           affiliates), as set forth on the applicable Notice of
                           Conversion, would beneficially own in excess of 9.99%
                           of  the  number  of  shares  of  the   Common   Stock
                           outstanding  immediately  after giving effect to such
                           conversion.  For purposes of the foregoing  sentence,
                           the  number of shares  of Common  Stock  beneficially
                           owned by the Holder and its affiliates  shall include
                           the number of shares of Common  Stock  issuable  upon
                           conversion  of this  Debenture  with respect to which
                           the determination of such sentence is being made, but
                           shall  exclude  the number of shares of Common  Stock
                           which would be issuable  upon (A)  conversion  of the
                           remaining,  nonconverted  portion  of this  Debenture
                           beneficially  owned  by  the  Holder  or  any  of its
                           affiliates  and (B)  exercise  or  conversion  of the
                           unexercised  or  nonconverted  portion  of any  other
                           securities   of  the  Company   (including,   without
                           limitation,  any other  Debentures  or the  Warrants)
                           subject to a  limitation  on  conversion  or exercise
                           analogous   to  the   limitation   contained   herein
                           beneficially  owned  by  the  Holder  or  any  of its
                           affiliates.  Except  as set  forth  in the  preceding


<PAGE>


                           sentence,  for  purposes  of this  Section  4(a)(ii),
                           beneficial   ownership   shall   be   calculated   in
                           accordance with Section 13(d) of the Exchange Act. To
                           the  extent  that the  limitation  contained  in this
                           section  applies,  the  determination of whether this
                           Debenture  is  convertible   (in  relation  to  other
                           securities  owned  by  the  Holder)  and of  which  a
                           portion of this Debenture is convertible  shall be in
                           the  sole  discretion  of  such  Holder.   To  ensure
                           compliance with this restriction,  the Holder will be
                           deemed  to  represent  to the  Company  each  time it
                           delivers a Notice of  Conversion  that such Notice of
                           Conversion  has not  violated  the  restrictions  set
                           forth in this paragraph and the Company shall have no
                           obligation  to verify or confirm the accuracy of such
                           determination. For purposes of this Section 4(a)(ii),
                           in determining  the number of  outstanding  shares of
                           Common  Stock,  the  Holder may rely on the number of
                           outstanding  shares of Common  Stock as  reflected in
                           (x) the Company's most recent Form 10-Q or Form 10-K,
                           as  the  case  may  be,  (y)  a  more  recent  public
                           announcement  by the Company or (z) any other  notice
                           by  the  Company  or  the  Company's  Transfer  Agent
                           setting  forth the  number of shares of Common  Stock
                           outstanding.  Upon the written or oral request of the
                           Holder,  the Company  shall  within two Trading  Days
                           confirm  orally  and in  writing  to the  Holder  the
                           number of shares of Common Stock then outstanding. In
                           any case, the number of outstanding  shares of Common
                           Stock shall be determined  after giving effect to the
                           conversion  or exercise of securities of the Company,
                           including  this  Debenture,  by  the  Holder  or  its
                           affiliates  since the date as of which such number of
                           outstanding shares of Common Stock was reported.  The
                           provisions of this Section  4(a)(ii) may be waived by
                           the Holder upon,  at the election of the Holder,  not
                           less than 61 days' prior notice to the  Company,  and
                           the  provisions  of this  Section  4(a)(ii)(B)  shall
                           continue  to apply until such 61st day (or such later
                           date,  as  determined  by  the  Holder,   as  may  be
                           specified in such notice of waiver).

                                    iii)   Underlying   Shares   Issuable   Upon
                           Conversion of Principal Amount.  The number of shares
                           of Common Stock  issuable upon a conversion  shall be
                           determined  by the quotient  obtained by dividing (x)
                           the outstanding principal amount of this Debenture to
                           be converted by (y) the Set Price.

                  (b) i) Not later than three Trading Days after any  Conversion
         Date,  the  Company  will  deliver  to  the  Holder  a  certificate  or
         certificates  representing the Underlying Shares which shall be free of
         restrictive legends and trading restrictions (other than those required
         by the Purchase Agreement)  representing the number of shares of Common
         Stock being acquired upon the conversion of Debentures  (including,  if
         so timely elected by the Company,  shares of Common Stock  representing
         the payment of accrued  interest) and (B) a bank check in the amount of
         accrued and unpaid  interest (if the Company is required to pay accrued
         interest in cash). The Company shall, if available and if allowed under
         applicable  securities  laws,  use its  best  efforts  to  deliver  any
         certificate  or  certificates  required to be  delivered by the Company
         under  this  Section   electronically   through  the  Depository  Trust
         Corporation  or another  established  clearing  corporation  performing
         similar  functions.  If in the case of any  Notice of  Conversion  such
         certificate or certificates  are not delivered to or as directed by the
         applicable Holder by the fifth Trading Day after a Conversion Date, the
         Holder  shall be entitled by written  notice to the Company at any time
         on  or  before  its  receipt  of  such   certificate  or   certificates
         thereafter,  to rescind  such  conversion,  in which  event the Company
         shall  immediately  return the certificates  representing the principal
         amount of Debentures tendered for conversion.

                           ii) If the Company fails for any reason to deliver to
                  the  Holder  such  certificate  or  certificates  pursuant  to
                  Section  4(b)(i) by the third Trading Day after the Conversion
                  Date,  the  Company  shall  pay to such  Holder,  in cash,  as
                  liquidated  damages  and not as a penalty,  for each $5,000 of
                  principal  amount  being   converted,   $50  per  Trading  Day
                  (increasing to $100 per Trading Day after 3 Trading Days after
                  such  damages  begin  to  accrue  and  increasing  to $200 per
                  Trading Day 6 Trading Days after such after such damages begin


<PAGE>


                  to accrue) for each  Trading Day after such third  Trading Day
                  until  such   certificates   are   delivered.   The  Company's
                  obligations  to issue and deliver the  Underlying  Shares upon
                  conversion  of this  Debenture  in  accordance  with the terms
                  hereof are absolute  and  unconditional,  irrespective  of any
                  action or  inaction  by the  Holder to enforce  the same,  any
                  waiver or consent with respect to any  provision  hereof,  the
                  recovery of any  judgment  against any Person or any action to
                  enforce  the same,  or any setoff,  counterclaim,  recoupment,
                  limitation or termination,  or any breach or alleged breach by
                  the  Holder  or any  other  Person  of any  obligation  to the
                  Company or any  violation  or alleged  violation of law by the
                  Holder  or any other  person,  and  irrespective  of any other
                  circumstance  which might  otherwise  limit such obligation of
                  the Company to the Holder in  connection  with the issuance of
                  such Underlying Shares; provided, however, such delivery shall
                  not  operate as a waiver by the Company of any such action the
                  Company may have against the Holder.  In the event a Holder of
                  this  Debenture  shall  elect  to  convert  any  or all of the
                  outstanding  principal  amount  hereof,  the  Company  may not
                  refuse  conversion  based on any claim  that the Holder or any
                  one  associated  or  affiliated  with the  Holder  of has been
                  engaged in any  violation  of law,  agreement or for any other
                  reason,  unless,  an  injunction  from  a  court,  on  notice,
                  restraining and or enjoining conversion of all or part of this
                  Debenture  shall have been sought and obtained and the Company
                  posts a  surety  bond for the  benefit  of the  Holder  in the
                  amount  of  150% of the  principal  amount  of this  Debenture
                  outstanding,  which is subject to the  injunction,  which bond
                  shall   remain   in   effect   until   the    completion    of
                  arbitration/litigation  of the  dispute  and the  proceeds  of
                  which shall be payable to such Holder to the extent it obtains
                  judgment. In the absence of an injunction precluding the same,
                  the Company shall issue  Conversion  Shares or, if applicable,
                  cash, upon a properly noticed conversion. Nothing herein shall
                  limit a Holder's  right to pursue actual damages or declare an
                  Event  of  Default  pursuant  to  Section  3  herein  for  the
                  Company's  failure to  deliver  Conversion  Shares  within the
                  period  specified  herein and such Holder shall have the right
                  to pursue  all  remedies  available  to it at law or in equity
                  including,   without   limitation,   a  decree   of   specific
                  performance and/or injunctive relief. The exercise of any such
                  rights  shall not prohibit the Holders from seeking to enforce
                  damages   pursuant  to  any  other  Section  hereof  or  under
                  applicable law.

                           iii) In addition to any other rights available to the
                  Holder,  if the Company fails for any reason to deliver to the
                  Holder such  certificate or  certificates  pursuant to Section
                  4(b)(i) by the third  Trading Day after the  Conversion  Date,
                  and if after such third  Trading Day the Holder is required by
                  its brokerage firm to purchase (in an open market  transaction
                  or  otherwise)  Common Stock to deliver in  satisfaction  of a
                  sale by such Holder of the Underlying  Shares which the Holder
                  anticipated receiving upon such conversion (a "Buy-In"),  then
                  the Company  shall (A) pay in cash to the Holder (in  addition
                  to any  remedies  available  to or elected by the  Holder) the
                  amount  by  which  (x)  the  Holder's   total  purchase  price
                  (including brokerage commissions, if any) for the Common Stock
                  so  purchased  exceeds  (y) the  product of (1) the  aggregate
                  number of shares of Common Stock that such Holder  anticipated
                  receiving from the  conversion at issue  multiplied by (2) the
                  actual sale price of the Common  Stock at the time of the sale
                  (including brokerage commissions,  if any) giving rise to such
                  purchase  obligation  and  (B) at the  option  of the  Holder,
                  either  reissue  Debentures  in principal  amount equal to the
                  principal amount of the attempted conversion or deliver to the
                  Holder  the  number of shares of Common  Stock that would have
                  been issued had the Company timely  complied with its delivery
                  requirements under Section 4(b)(i). For example, if the Holder
                  purchases  Common  Stock  having  a total  purchase  price  of
                  $11,000  to  cover  a  Buy-In  with  respect  to an  attempted
                  conversion of Debentures with respect to which the actual sale
                  price  of the  Underlying  Shares  at  the  time  of the  sale
                  (including brokerage commissions,  if any) giving rise to such
                  purchase obligation was a total of $10,000 under clause (A) of
                  the  immediately  preceding  sentence,  the  Company  shall be
                  required to pay the Holder  $1,000.  The Holder shall  provide
                  the Company  written notice  indicating the amounts payable to
                  the Holder in respect of the Buy-In.  Notwithstanding anything
                  contained  herein to the  contrary,  if a Holder  requires the


<PAGE>


                  Company to make payment in respect of a Buy-In for the failure
                  to  timely  deliver  certificates  hereunder  and the  Company
                  timely pays in full such  payment,  the  Company  shall not be
                  required to pay such Holder  liquidated  damages under Section
                  4(b)(ii)  in respect  of the  certificates  resulting  in such
                  Buy-In.

                           iv) After the Effective Date, the Company may, within
                  5 Trading Days of the Effective Date,  deliver a notice to the
                  Holder (a  "Forced  Conversion"  and the date  such  notice is
                  received by the Holder,  the "Forced  Conversion Notice Date")
                  to cause the Holder to immediately  convert all or part of the
                  then outstanding  principal  amount of Debentures  pursuant to
                  Section  4(a)(i) and the Holder shall surrender this Debenture
                  to the Company for  conversion  within 30 Trading  Days of the
                  Forced  Conversion  Notice Date. The Company may only effect a
                  Forced  Conversion  Notice if all of the Equity Conditions are
                  met from the period beginning on the Effective Date and ending
                  on the date of the Forced  Conversion.  Any Forced  Conversion
                  shall be applied ratably to all Holders based on their initial
                  purchases of Debentures pursuant to the Purchase Agreement.

                  (c) i) The conversion  price in effect on any Conversion  Date
         shall be  equal  to  $0.08  (subject  to  adjustment  herein)(the  "Set
         Price").

                           ii) If the Company,  at any time while the Debentures
                  are  outstanding:  (A) shall pay a stock dividend or otherwise
                  make a distribution or  distributions  on shares of its Common
                  Stock or any  other  equity or  equity  equivalent  securities
                  payable in shares of Common  Stock  (which,  for  avoidance of
                  doubt,  shall not include any shares of Common Stock issued by
                  the Company pursuant to this Debenture,  including as interest
                  thereon),  (B)  subdivide  outstanding  shares of Common Stock
                  into a larger number of shares,  (C) combine (including by way
                  of reverse  stock  split)  outstanding  shares of Common Stock
                  into  a   smaller   number   of   shares,   or  (D)  issue  by
                  reclassification  of shares of the Common  Stock any shares of
                  capital  stock of the  Company,  then the Set  Price  shall be
                  multiplied by a fraction of which the  numerator  shall be the
                  number of shares of Common Stock  (excluding  treasury shares,
                  if  any)  outstanding  before  such  event  and of  which  the
                  denominator  shall be the  number of  shares  of Common  Stock
                  outstanding  after such event. Any adjustment made pursuant to
                  this Section  shall  become  effective  immediately  after the
                  record date for the determination of stockholders  entitled to
                  receive  such  dividend  or  distribution   and  shall  become
                  effective  immediately after the effective date in the case of
                  a subdivision, combination or re-classification.

                           iii) If the  Company or any  subsidiary  thereof,  as
                  applicable,  at any time  while  Debentures  are  outstanding,
                  shall offer, sell, grant any option to purchase or offer, sell
                  or grant any right to reprice  its  securities,  or  otherwise
                  dispose of or issue (or announce any offer, sale, grant or any
                  option to purchase or other disposition) any Capital Shares or
                  Capital  Shares  Equivalents  entitling  any Person to acquire
                  shares of Common Stock,  at an effective  price per share less
                  than the then Set Price  ("Dilutive  Issuance"),  as  adjusted
                  hereunder  (if the  holder of the  Capital  Shares or  Capital
                  Shares  Equivalents  so issued  shall at any time,  whether by
                  operation of purchase  price  adjustments,  reset  provisions,
                  floating conversion, exercise or exchange prices or otherwise,
                  or due to  warrants,  options  or rights  per  share  which is
                  issued  in  connection  with such  issuance,  be  entitled  to
                  receive shares of Common Stock at an effective price per share
                  which  is less  than the Set  Price,  such  issuance  shall be
                  deemed to have occurred for less than the Set Price), then the
                  Set Price shall be reduced to equal the effective  conversion,
                  exchange or purchase  price for such Capital Shares or Capital
                  Shares Equivalents (including any reset provisions thereof) at
                  issue.  Such  adjustment  shall be made  whenever such Capital
                  Shares or Capital Shares  Equivalents are issued.  The Company
                  shall notify the Holder in writing, no later than the business
                  day  following  the issuance of any Capital  Shares or Capital
                  Shares Equivalents subject to this section, indicating therein
                  the applicable  issuance price, or of applicable  reset price,
                  exchange price, conversion price and other pricing terms.


<PAGE>


                           iv) If the Company,  at any time while Debentures are
                  outstanding,  shall  distribute to all holders of Common Stock
                  (and not to Holders)  evidences of its  indebtedness or assets
                  or  rights  or  warrants  to  subscribe  for or  purchase  any
                  security,  then in each  such  case  the Set  Price  shall  be
                  determined  by  multiplying  such price in effect  immediately
                  prior  to  the  record   date  fixed  for   determination   of
                  stockholders  entitled  to  receive  such  distribution  by  a
                  fraction of which the denominator shall be the VWAP determined
                  as of the  record  date  mentioned  above,  and of  which  the
                  numerator shall be such VWAP on such record date less the then
                  fair  market  value at such record date of the portion of such
                  assets or evidence of indebtedness  so distributed  applicable
                  to one outstanding  share of the Common Stock as determined by
                  the Board of  Directors  in good  faith.  In  either  case the
                  adjustments shall be described in a statement  provided to the
                  Holders of the portion of assets or evidences of  indebtedness
                  so distributed or such  subscription  rights applicable to one
                  share of Common Stock.  Such adjustment shall be made whenever
                  any such  distribution  is made  and  shall  become  effective
                  immediately after the record date mentioned above.

                           v) All  calculations  under  this  Section 4 shall be
                  made to the nearest cent or the nearest 1/100th of a share, as
                  the case may be. For purposes of this Section 4, the number of
                  shares of Common Stock outstanding as of a given date shall be
                  the sum of the  number of shares  of Common  Stock  (excluding
                  treasury shares, if any) outstanding.

                           vi)  Whenever  the Set Price is adjusted  pursuant to
                  any of Section 4(c)(ii) - (v), the Company shall promptly mail
                  to each Holder a notice setting forth the Set Price after such
                  adjustment  and setting  forth a brief  statement of the facts
                  requiring  such  adjustment.  If the Company issues a variable
                  rate security, despite the prohibition thereon in the Purchase
                  Agreement,  the Company shall be deemed to have issued Capital
                  Shares or Capital Shares  Equivalents  at the lowest  possible
                  conversion or exercise  price at which such  securities may be
                  converted  or  exercised  in  the  case  of  a  Variable  Rate
                  Transaction  (as defined in the  Purchase  Agreement),  or the
                  lowest  possible  adjustment  price  in  the  case  of an  MFN
                  Transaction (as defined in the Purchase Agreement).

                           vii) If (A) the Company  shall declare a dividend (or
                  any other  distribution)  on the Common Stock; (B) the Company
                  shall  declare a special  nonrecurring  cash  dividend on or a
                  redemption  of  the  Common  Stock;   (C)  the  Company  shall
                  authorize  the  granting  to all  holders of the Common  Stock
                  rights or warrants to subscribe  for or purchase any shares of
                  capital stock of any class or of any rights;  (D) the approval
                  of any  stockholders  of the  Company  shall  be  required  in
                  connection with any  reclassification of the Common Stock, any
                  consolidation  or merger to which the Company is a party,  any
                  sale or transfer of all or substantially  all of the assets of
                  the Company,  of any  compulsory  share  exchange  whereby the
                  Common  Stock is  converted  into  other  securities,  cash or
                  property;  (E) the Company  shall  authorize  the voluntary or
                  involuntary  dissolution,  liquidation  or  winding  up of the
                  affairs of the Company;  then, in each case, the Company shall
                  cause to be filed at each office or agency  maintained for the
                  purpose of conversion of the Debentures, and shall cause to be
                  mailed to the  Holders at their last  addresses  as they shall
                  appear  upon  the  stock  books  of the  Company,  at least 20
                  calendar days prior to the applicable record or effective date
                  hereinafter  specified, a notice stating (x) the date on which
                  a record  is to be taken  for the  purpose  of such  dividend,
                  distribution,  redemption,  rights or warrants, or if a record
                  is not to be taken,  the date as of which the  holders  of the
                  Common  Stock  of  record  to be  entitled  to such  dividend,
                  distributions,  redemption,  rights  or  warrants  are  to  be
                  determined  or (y) the  date on which  such  reclassification,
                  consolidation,  merger,  sale,  transfer or share  exchange is
                  expected  to become  effective  or  close,  and the date as of
                  which it is  expected  that  holders  of the  Common  Stock of


<PAGE>


                  record  shall be  entitled  to  exchange  their  shares of the
                  Common   Stock  for   securities,   cash  or  other   property
                  deliverable upon such reclassification, consolidation, merger,
                  sale, transfer or share exchange;  provided,  that the failure
                  to mail such  notice or any defect  therein or in the  mailing
                  thereof shall not affect the validity of the corporate  action
                  required to be specified in such notice.  Holders are entitled
                  to convert  Debentures during the 20-day period commencing the
                  date  of  such  notice  to the  effective  date  of the  event
                  triggering such notice.

                           viii)  If,  at  any  time  while  this  Debenture  is
                  outstanding,   (A)  the   Company   effects   any   merger  or
                  consolidation of the Company with or into another Person,  (B)
                  the Company  effects any sale of all or  substantially  all of
                  its assets in one or a series of related transactions, (C) any
                  tender  offer or  exchange  offer  (whether  by the Company or
                  another  Person) is  completed  pursuant  to which  holders of
                  Common Stock are permitted to tender or exchange  their shares
                  for other  securities,  cash or  property,  or (D) the Company
                  effects  any  reclassification  of  the  Common  Stock  or any
                  compulsory  share exchange  pursuant to which the Common Stock
                  is   effectively   converted   into  or  exchanged  for  other
                  securities, cash or property (in any such case, a "Fundamental
                  Transaction"),  then upon any  subsequent  conversion  of this
                  Debenture,  the Holder  shall have the right to  receive,  for
                  each Underlying  Share that would have been issuable upon such
                  conversion absent such Fundamental Transaction,  the same kind
                  and amount of  securities,  cash or  property as it would have
                  been   entitled  to  receive  upon  the   occurrence  of  such
                  Fundamental  Transaction if it had been,  immediately prior to
                  such  Fundamental  Transaction,  the  holder  of one  share of
                  Common Stock (the "Alternate Consideration").  For purposes of
                  any such conversion,  the determination of the Set Price shall
                  be   appropriately   adjusted  to  apply  to  such   Alternate
                  Consideration  based on the amount of Alternate  Consideration
                  issuable  in  respect  of one  share of  Common  Stock in such
                  Fundamental  Transaction,  and the Company shall apportion the
                  Set Price among the  Alternate  Consideration  in a reasonable
                  manner   reflecting   the  relative  value  of  any  different
                  components  of the  Alternate  Consideration.  If  holders  of
                  Common Stock are given any choice as to the  securities,  cash
                  or property to be received in a Fundamental Transaction,  then
                  the Holder shall be given the same choice as to the  Alternate
                  Consideration   it  receives  upon  any   conversion  of  this
                  Debenture  following  such  Fundamental  Transaction.  To  the
                  extent necessary to effectuate the foregoing  provisions,  any
                  successor  to  the  Company  or   surviving   entity  in  such
                  Fundamental  Transaction  shall  issue  to  the  Holder  a new
                  debenture   consistent  with  the  foregoing   provisions  and
                  evidencing  the Holder's  right to convert such debenture into
                  Alternate  Consideration.  The terms of any agreement pursuant
                  to which a Fundamental  Transaction  is effected shall include
                  terms  requiring  any such  successor or  surviving  entity to
                  comply with the  provisions of this paragraph (c) and insuring
                  that this Debenture (or any such replacement security) will be
                  similarly adjusted upon any subsequent  transaction  analogous
                  to a Fundamental Transaction.

                           ix) Notwithstanding the foregoing, no adjustment will
                  be  made  under  this  paragraph  (c) in  respect  of (A)  the
                  granting or issuance of shares of capital  stock or of options
                  to employees,  officers and directors of the Company  pursuant
                  to any stock option plan agreement or arrangement duly adopted
                  or approved by a majority of the  non-employee  members of the
                  Board of Directors of the Company or a majority of the members
                  of a committee of non-employee  directors established for such
                  purpose,  (B) upon the exercise of this Debenture or any other
                  Debenture  of this  series or of any other  series or security
                  issued by the Company in connection with the offer and sale of
                  this Company's  securities pursuant to the Purchase Agreement,
                  or (C) upon  the  exercise  of or  conversion  of any  Capital
                  Shares  Equivalents,  rights,  options or warrants  issued and
                  outstanding  on  the  Original   Issue  Date,   provided  such
                  securities  have  not  been  amended  since  the  date  of the
                  Purchase   Agreement  except  as  a  result  of  the  Purchase
                  Agreement,  or (D) issuance of securities  in connection  with
                  acquisitions,  strategic investments,  or strategic partnering
                  arrangements,  the  primary  purpose  of which is not to raise
                  capital.


<PAGE>


                  (d) The Company  covenants  that it will at all times  reserve
         and keep available out of its authorized and unissued  shares of Common
         Stock  solely  for the  purpose  of  issuance  upon  conversion  of the
         Debentures  and payment of interest  on the  Debenture,  each as herein
         provided,  free from preemptive  rights or any other actual  contingent
         purchase  rights of persons other than the Holders,  not less than such
         number  of  shares  of  the  Common  Stock  as  shall  (subject  to any
         additional requirements of the Company as to reservation of such shares
         set forth in the Purchase  Agreement) be issuable  (taking into account
         the adjustments  and  restrictions of Section 4(b)) upon the conversion
         of the  outstanding  principal  amount of the Debentures and payment of
         interest  hereunder.  The Company  covenants  that all shares of Common
         Stock that shall be so issuable shall,  upon issue, be duly and validly
         authorized,   issued  and  fully  paid,   nonassessable   and,  if  the
         Registration  Statement is then  effective  under the  Securities  Act,
         registered  for  public  sale  in  accordance  with  such  Registration
         Statement.

                  (e) Upon a  conversion  hereunder  the  Company  shall  not be
         required to issue stock certificates  representing  fractions of shares
         of the  Common  Stock,  but  may if  otherwise  permitted,  make a cash
         payment in respect of any final  fraction  of a share based on the VWAP
         at such time. If the Company  elects not, or is unable,  to make such a
         cash payment,  the Holder shall be entitled to receive,  in lieu of the
         final fraction of a share, one whole share of Common Stock.

                  (f) The  issuance  of  certificates  for  shares of the Common
         Stock on conversion of the  Debentures  shall be made without charge to
         the Holders thereof for any documentary stamp or similar taxes that may
         be payable in respect  of the issue or  delivery  of such  certificate,
         provided that the Company shall not be required to pay any tax that may
         be payable in respect of any  transfer  involved  in the  issuance  and
         delivery of any such  certificate  upon conversion in a name other than
         that of the Holder of such  Debentures  so  converted  and the  Company
         shall not be required to issue or deliver such  certificates  unless or
         until the person or persons  requesting the issuance thereof shall have
         paid to the Company the amount of such tax or shall have established to
         the satisfaction of the Company that such tax has been paid.

                  (g) Any and all notices or other  communications or deliveries
         to be provided by the Holders hereunder, including, without limitation,
         any Notice of Conversion, shall be in writing and delivered personally,
         by  facsimile,  sent  by  a  nationally  recognized  overnight  courier
         service,  addressed  to the  Company,  at the address set forth  above,
         facsimile number (719) 260-6456,  Attn: Douglas O. Mckinnon,  President
         or such other  address or  facsimile  number as the Company may specify
         for such purposes by notice to the Holders delivered in accordance with
         this Section. Any and all notices or other communications or deliveries
         to be  provided  by the  Company  hereunder  shall  be in  writing  and
         delivered  personally,  by facsimile,  sent by a nationally  recognized
         overnight  courier  service  addressed to each Holder at the  facsimile
         telephone  number or address of such Holder  appearing  on the books of
         the  Company,  or if no such  facsimile  telephone  number  or  address
         appears,  at the principal place of business of the Holder.  Any notice
         or other  communication  or deliveries  hereunder shall be deemed given
         and effective on the earliest of (i) the date of transmission,  if such
         notice or  communication  is delivered  via  facsimile at the facsimile
         telephone number specified in this Section prior to 5:30 p.m. (New York
         City  time),  (ii) the date  after  the date of  transmission,  if such
         notice or  communication  is delivered  via  facsimile at the facsimile
         telephone  number  specified in this Section  later than 5:30 p.m. (New
         York City time) on any date and earlier than 11:59 p.m.  (New York City
         time) on such date, (iii) the second Business Day following the date of
         mailing, if sent by nationally recognized overnight courier service, or
         (iv) upon  actual  receipt by the party to whom such notice is required
         to be given.


         Section 5.  Definitions.  For the purposes  hereof,  in addition to the
terms defined  elsewhere in this Debenture:  (a) capitalized terms not otherwise
defined herein have the meanings given to such terms in the Purchase  Agreement,
and (b) the following terms shall have the following meanings:


<PAGE>


                  "Business Day" means any day except  Saturday,  Sunday and any
         day which shall be a federal  legal  holiday in the United  States or a
         day on  which  banking  institutions  in the  State  of  New  York  are
         authorized or required by law or other government action to close.

                  "Change of Control Transaction" means the occurrence after the
         date  hereof of any of (i) an  acquisition  after the date hereof by an
         individual or legal entity or "group" (as described in Rule 13d-5(b)(1)
         promulgated  under the  Exchange  Act) of  effective  control  (whether
         through legal or beneficial  ownership of capital stock of the Company,
         by contract or otherwise) of in excess of 45% of the voting  securities
         of the Company (provided a Change of Control Transaction shall not have
         occurred  as a  result  of  the  transactions  contemplated  under  the
         Purchase  Agreement or the acquisitions which may occur which have been
         disclosed orally to the original  Holder,  or (ii) a replacement at one
         time or within a three year period of more than one-half of the members
         of the Company's board of directors which is not approved by a majority
         of those  individuals  who are members of the board of directors on the
         date hereof (or by those  individuals who are serving as members of the
         board  of  directors  on any  date  whose  nomination  to the  board of
         directors  was  approved  by a majority  of the members of the board of
         directors who are members on the date  hereof),  or (iii) the execution
         by the  Company of an  agreement  to which the Company is a party or by
         which it is bound,  providing  for any of the events set forth above in
         (i) or (ii).

                  "Commission" means the Securities and Exchange Commission.

                  "Common  Stock" means the common  stock,  $.0001 par value per
         share,  of the  Company  and stock of any other  class  into which such
         shares may hereafter have been reclassified or changed.

                  "Conversion  Date" shall have the meaning set forth in Section
         4(a)(i) hereof.

                  "Equity Conditions" shall mean, during the period in question,
         (i) the Company shall have duly honored all conversions and redemptions
         scheduled  to occur or  occurring  by virtue of one or more  Conversion
         Notices, if any, (ii) all liquidated damages and other amounts owing in
         respect  of the  Debentures  shall have been  paid;  (iii)  there is an
         effective  Registration  Statement  pursuant  to which  the  Holder  is
         permitted  to utilize the  prospectus  thereunder  to resell all of the
         shares issuable pursuant to the Transaction  Documents (and the Company
         believes,   in  good  faith,  that  such  effectiveness  will  continue
         uninterrupted  for the  foreseeable  future),  (iv) the Common Stock is
         trading on the Principal Market and all of the shares issuable pursuant
         to the  Transaction  Documents  are listed for  trading on a  Principal
         Market (and the Company  believes,  in good faith,  that trading of the
         Common Stock on a Principal Market will continue  uninterrupted for the
         foreseeable future), (v) there is a sufficient number of authorized but
         unissued  and  otherwise  unreserved  shares  of  Common  Stock for the
         issuance  of all of the shares  issuable  pursuant  to the  Transaction
         Documents,  (vi)  there is then  existing  no Event of Default or event
         which,  with  the  passage  of  time or the  giving  of  notice,  would
         constitute  and Event of Default and (vii) all of the shares  issued or
         issuable  pursuant to the transaction  documents in full,  ignoring for
         such purposes any conversion or exercise limitation therein,  would not
         violate the  limitations  set forth in Section  4(a)(ii)(B) and (ix) no
         public announcement of a pending or proposed Fundamental Transaction or
         acquisition transaction has occurred that has not been consummated.

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

                  "Interest  Conversion  Rate"  means the  lesser of (a) the Set
         Price  and (b) 90% of the  lesser  of (i) the  average  of the 20 VWAPS
         immediately  prior to the applicable  Interest Payment Date or (ii) the
         average of the 20 VWAPs  immediately  prior to the date the  applicable
         interest  payment shares are issued and delivered if after the Interest
         Payment Date.

                  "Late  Fees"  shall have the  meaning  set forth in the second
         paragraph to this Debenture.


<PAGE>


                  "Mandatory  Prepayment  Amount" for any Debentures shall equal
         the sum of (i) the  greater  of:  (A) 130% of the  principal  amount of
         Debentures to be prepaid, plus all accrued and unpaid interest thereon,
         or (B) the principal amount of Debentures to be prepaid, plus all other
         accrued and unpaid interest hereon, divided by the Set Price on (x) the
         date the  Mandatory  Prepayment  Amount is demanded or otherwise due or
         (y) the date the Mandatory Prepayment Amount is paid in full, whichever
         is  less,  multiplied  by  the  VWAP  on (x)  the  date  the  Mandatory
         Prepayment  Amount is  demanded  or  otherwise  due or (y) the date the
         Mandatory  Prepayment Amount is paid in full, whichever is greater, and
         (ii) all other amounts,  costs,  expenses and liquidated damages due in
         respect of such Debentures.

                  "Original  Issue  Date"  shall  mean  the  date  of the  first
         issuance of the Debentures regardless of the number of transfers of any
         Debenture  and  regardless  of the number of  instruments  which may be
         issued to evidence such Debenture.

                  "Person" means a corporation,  an association,  a partnership,
         organization,  a business,  an  individual,  a government  or political
         subdivision thereof or a governmental agency.

                  "Purchase  Agreement" means the Securities Purchase Agreement,
         dated as of April ___,  2004,  to which the  Company  and the  original
         Holder are parties,  as amended,  modified or supplemented from time to
         time in accordance with its terms.

                  "Registration  Rights Agreement" means the Registration Rights
         Agreement, dated as of the date of the Purchase Agreement, to which the
         Company and the original  Holder are parties,  as amended,  modified or
         supplemented from time to time in accordance with its terms.

                  "Registration   Statement"  means  a  registration   statement
         meeting  the  requirements   set  forth  in  the  Registration   Rights
         Agreement,  covering  among other  things the resale of the  Underlying
         Shares and naming the Holder as a "selling stockholder" thereunder.

                  "Securities Act" means the Securities Act of 1933, as amended,
         and the rules and regulations promulgated thereunder.

                  "Set  Price"  shall  have the  meaning  set  forth in  Section
         4(c)(i).

                  "Trading  Day"  means (a) a day on which the  shares of Common
         Stock are  traded on a  Principal  Market on which the shares of Common
         Stock are then listed or quoted,  or (b) if the shares of Common  Stock
         are not  quoted on a  Principal  Market,  a day on which the  shares of
         Common Stock are quoted in the  over-the-counter  market as reported by
         the National Quotation Bureau Incorporated (or any similar organization
         or agency succeeding its functions of reporting prices); provided, that
         in the event that the  shares of Common  Stock are not listed or quoted
         as set forth in (a), (b) and (c) hereof,  then Trading Day shall mean a
         Business Day.

                  "Transaction  Documents"  shall have the  meaning set forth in
         the Purchase Agreement.

                  "Underlying  Shares" means the shares of Common Stock issuable
         upon  conversion  of Debentures or as payment of interest in accordance
         with the terms hereof.

                  "VWAP" means,  for any date, the price determined by the first
         of the following clauses that applies:  (a) if the Common Stock is then
         listed or quoted  on a  Principal  Market,  the daily  volume  weighted
         average  price  of the  Common  Stock  for such  date  (or the  nearest
         preceding  date) on the  Principal  Market on which the Common Stock is
         then listed or quoted as reported by Bloomberg Financial L.P. (based on
         a trading day from 9:30 a.m.  Eastern Time to 4:02 p.m.  Eastern Time);
         (b) if the  Common  Stock is not then  listed or quoted on a  Principal
         Market and if prices for the  Common  Stock are then  quoted on the OTC


<PAGE>


         Bulletin Board,  the volume weighted  average price of the Common Stock
         for  such  date (or the  nearest  preceding  date) on the OTC  Bulletin
         Board;  (c) if the Common Stock is not then listed or quoted on the OTC
         Bulletin  Board and if prices for the Common Stock are then reported in
         the  "Pink  Sheets"   published  by  the  National   Quotation   Bureau
         Incorporated  (or a similar  organization  or agency  succeeding to its
         functions of reporting prices),  the most recent bid price per share of
         the  Common  Stock so  reported;  or (d) in all other  cases,  the fair
         market value of a share of Common Stock as determined by an independent
         appraiser  selected  in good  faith by the  Purchasers  and  reasonably
         acceptable to the Company.

         Section 6. Reserved.

         Section 7. Except as expressly  provided  herein,  no provision of this
Debenture shall alter or impair the obligation of the Company, which is absolute
and unconditional,  to pay the principal of, interest and liquidated damages (if
any) on,  this  Debenture  at the  time,  place,  and  rate,  and in the coin or
currency,  herein prescribed.  This Debenture is a direct debt obligation of the
Company and,  pursuant to the Security  Agreement is secured by a first priority
security  interest  in all of the assets of the  Company  for the benefit of the
Holders.  This  Debenture  ranks  pari passu  with all other  Debentures  now or
hereafter issued under the terms set forth herein.  As long as this Debenture is
outstanding,  the  Company  shall not and shall  cause it  subsidiaries  not to,
without the consent of the Holder,  (a) amend its certificate of  incorporation,
bylaws or other  charter  documents so as to adversely  affect any rights of the
Holder; (b) repay, repurchase or offer to repay, repurchase or otherwise acquire
more than a de  minimis  number of shares of its  Common  Stock or other  equity
securities  other than as to the  Underlying  Shares to the extent  permitted or
required  under the  Transaction  Documents  or as  otherwise  permitted  by the
Transaction  Documents;  or (c) enter into any agreement  with respect to any of
the foregoing.

         Section  8. If this  Debenture  shall be  mutilated,  lost,  stolen  or
destroyed,  the Company shall execute and deliver,  in exchange and substitution
for  and  upon  cancellation  of a  mutilated  Debenture,  or in  lieu  of or in
substitution for a lost, stolen or destroyed Debenture,  a new Debenture for the
principal amount of this Debenture so mutilated,  lost,  stolen or destroyed but
only upon  receipt  of  evidence  of such  loss,  theft or  destruction  of such
Debenture,  and of the  ownership  hereof,  and  indemnity,  if  requested,  all
reasonably satisfactory to the Company.

         Section 9. Except with respect to the possible acquisitions referred to
in the definition of "Change of Control Transaction",  so long as any portion of
this Debenture is  outstanding,  the Company will not and will not permit any of
its subsidiaries to, directly or indirectly,  enter into, create,  incur, assume
or suffer to exist any  indebtedness or liens of any kind, on or with respect to
any of its  property or assets now owned or  hereafter  acquired or any interest
therein  or any  income or  profits  therefrom  that is senior to, or pari passu
with, in any respect, the Company's obligations under the Debentures without the
prior consent of the Holder, which consent shall not be unreasonably withheld.

         Section  10.  All  questions  concerning  the  construction,  validity,
enforcement  and  interpretation  of this  Debenture  shall be  governed  by and
construed and enforced in accordance  with the internal laws of the State of New
York,  without regard to the principles of conflicts of law thereof.  Each party
agrees that all legal proceedings  concerning the  interpretations,  enforcement
and defense of the transactions contemplated by any of the Transaction Documents
(whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, employees or agents) shall be commenced in the state and
federal courts  sitting in the City of New York,  Borough of Manhattan (the "New
York  Courts").  Each party hereto hereby  irrevocably  submits to the exclusive
jurisdiction  of the  New  York  Courts  for  the  adjudication  of any  dispute
hereunder or in connection herewith or with any transaction  contemplated hereby
or discussed  herein  (including  with respect to the  enforcement of any of the
Transaction Documents),  and hereby irrevocably waives, and agrees not to assert
in any suit, action or proceeding,  any claim that it is not personally  subject
to the  jurisdiction  of any such court, or such New York Courts are improper or
inconvenient  venue for such proceeding.  Each party hereby  irrevocably  waives
personal  service of process and  consents to process  being  served in any such
suit, action or proceeding by mailing a copy thereof via registered or certified
mail or  overnight  delivery  (with  evidence of  delivery) to such party at the
address in effect for  notices to it under this  Debenture  and agrees that such
service  shall  constitute  good and  sufficient  service of process  and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right


<PAGE>


to serve  process in any manner  permitted  by law.  Each  party  hereto  hereby
irrevocably  waives,  to the fullest extent permitted by applicable law, any and
all right to trial by jury in any legal proceeding arising out of or relating to
this Debenture or the transactions  contemplated  hereby.  If either party shall
commence an action or  proceeding to enforce any  provisions of this  Debenture,
then the  prevailing  party in such action or proceeding  shall be reimbursed by
the other party for its  attorneys  fees and other costs and  expenses  incurred
with  the   investigation,   preparation  and  prosecution  of  such  action  or
proceeding.

         Section  11. Any waiver by the Company or the Holder of a breach of any
provision of this Debenture  shall not operate as or be construed to be a waiver
of any other breach of such provision or of any breach of any other provision of
this  Debenture.  The failure of the Company or the Holder to insist upon strict
adherence to any term of this  Debenture on one or more  occasions  shall not be
considered a waiver or deprive that party of the right thereafter to insist upon
strict  adherence to that term or any other term of this  Debenture.  Any waiver
must be in writing.

         Section 12. If any provision of this  Debenture is invalid,  illegal or
unenforceable,  the balance of this Debenture shall remain in effect, and if any
provision is inapplicable to any person or circumstance,  it shall  nevertheless
remain applicable to all other persons and  circumstances.  If it shall be found
that any  interest  or other  amount  deemed  interest  due  hereunder  violates
applicable laws governing  usury,  the applicable rate of interest due hereunder
shall  automatically be lowered to equal the maximum permitted rate of interest.
The Company  covenants  (to the extent that it may lawfully do so) that it shall
not at any time insist upon,  plead, or in any manner  whatsoever  claim or take
the benefit or advantage of, any stay, extension or usury law or other law which
would  prohibit  or forgive  the  Company  from paying all or any portion of the
principal of or interest on this  Debenture  as  contemplated  herein,  wherever
enacted,  now or at any time  hereafter  in  force,  or  which  may  affect  the
covenants or the performance of this  indenture,  and the Company (to the extent
it may lawfully do so) hereby  expressly waives all benefits or advantage of any
such law,  and  covenants  that it will not, by resort to any such law,  hinder,
delay or impeded the  execution of any power herein  granted to the Holder,  but
will  suffer and permit  the  execution  of every such as though no such law has
been enacted.

         Section 13. Whenever any payment or other obligation hereunder shall be
due on a day other than a Business  Day,  such payment shall be made on the next
succeeding Business Day.


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


<PAGE>

         IN WITNESS WHEREOF,  the Company has caused this Convertible  Debenture
to be duly  executed  by a duly  authorized  officer as of the date first  above
indicated.

                                                 USURF AMERICA, INC.


                                                 By: /s/ Douglas O. McKinnon
                                                   -----------------------------
                                                   Name:  Douglas O. McKinnon
                                                   Title: President & CEO



<PAGE>



                                                                         ANNEX A

                              NOTICE OF CONVERSION


The  undersigned  hereby  elects to  convert  principal  under  the  Convertible
Debenture of Usurf America, Inc. (the "Company"),  due on April ____, 2006, into
shares of common stock, $0.0001 par value per share (the "Common Stock"), of the
Company  according to the conditions  hereof,  as of the date written below.  If
shares are to be issued in the name of a person other than the undersigned,  the
undersigned  will pay all transfer  taxes  payable  with respect  thereto and is
delivering  herewith such  certificates and opinions as reasonably  requested by
the Company in  accordance  therewith.  No fee will be charged to the holder for
any conversion, except for such transfer taxes, if any.

By the delivery of this Notice of  Conversion  the  undersigned  represents  and
warrants  to the  Company  that the  conversion  hereunder  will not  cause  its
beneficial  ownership  of the  Company's  Common  Stock  to  exceed  the  amount
determined in accordance with Section 4(a)(II)(B) of this Debenture.

The undersigned agrees to comply with the prospectus delivery requirements under
the applicable  securities laws in connection with any transfer of the aforesaid
shares of Common Stock.

Conversion calculations:
                           Date to Effect Conversion:

                           Principal Amount of Debentures to be Converted:

                           Payment of Interest in Common Stock __ yes  __ no
                                    If yes, $_____ of Interest Accrued on
                                    Account of Conversion at Issue.

                           Number of shares of Common Stock to
be issued:


                           Signature:

                           Name:

                           Address:



<PAGE>


                                   Schedule 1

                               CONVERSION SCHEDULE

Convertible  Debentures  due on April ____,  2006,  in the  aggregate  principal
amount of $____________ issued by Usurf America,  Inc.. This Conversion Schedule
reflects conversions made under Section 4 of the above referenced Debenture.

                                     Dated:

<TABLE>
<CAPTION>


                                                           AGGREGATE PRINCIPAL
                                                             AMOUNT REMAINING
      DATE OF CONVERSION                                      SUBSEQUENT TO
(OR FOR FIRST ENTRY, ORIGINAL                                   CONVERSION
         ISSUE DATE)              AMOUNT OF CONVERSION         (OR ORIGINAL              COMPANY ATTEST
                                                            PRINCIPAL AMOUNT)
------------------------------- ------------------------- ----------------------- ------------------------------
<S>                             <C>                       <C>                     <C>



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</TABLE>