EXHIBIT 4.1.A
                          SECURED CONVERTIBLE DEBENTURE
                              DUE SEPTEMBER 5, 2005

                                                                       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: MARCH 5, 2004
Original Conversion Price (subject to adjustment herein): $0.10

                                                                $---------------


                          SECURED CONVERTIBLE DEBENTURE
                              DUE SEPTEMBER 5, 2005

         THIS DEBENTURE is one of a series of duly authorized and issued Secured
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 September 5, 2005 (the "Debentures").

         FOR   VALUE    RECEIVED,    the    Company    promises    to   pay   to
________________________ or its registered assigns (the "Holder"), the principal
sum of  $_______________  on  September  5,  2005  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 6% 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;
provided,  however,  if during the period  beginning  on the 150th  calendar day
following  the  Original  Issue Date until the date this  Debenture is no longer
outstanding the Equity Conditions are satisfied, no interest shall be payable on
this Debenture. 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").  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. 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:


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         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.

                  a) "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;

                           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


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                  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;

                           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;


<PAGE>


                           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;

                           (xiii)  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; or

                           xiv) any Person shall breach the agreements delivered
                  to the initial  Holders  pursuant to Section  2.2(a)(v) of the
                  Purchase Agreement and the Company does not obtain Shareholder
                  Approval.

                  b) 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
         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


<PAGE>


         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.



<PAGE>



                  ii) Conversion Limitations.

                           (A) Notwithstanding  anything herein to the contrary,
                  if the  Company  has not  obtained  Shareholder  Approval  (as
                  defined  below),  if  required  by the  applicable  rules  and
                  regulations of the Principal Market (or any successor entity),
                  then  the  Company  may  not  issue  upon  conversion  of  the
                  Debentures,  in the  aggregate,  in excess of  19.999%  of the
                  number of shares of Common  Stock  outstanding  on the Trading
                  Day  immediately  preceding  the  Original  Issue Date,  (such
                  number of shares, the "Issuable  Maximum").  Each Holder shall
                  be entitled to a portion of the Issuable  Maximum equal to the
                  quotient  obtained by  dividing  (x) the  aggregate  principal
                  amount of the  Debenture(s)  issued and sold to such Holder on
                  the Original Issue Date by (y) the aggregate  principal amount
                  of all  Debentures  issued  and  sold  by the  Company  on the
                  Original  Issue Date.  If any Holder  shall no longer hold the
                  Debenture(s),  then such  Holder's  remaining  portion  of the
                  Issuable  Maximum  shall  be  allocated   pro-rata  among  the
                  remaining  Holders.   If  on  any  Conversion  Date:  (1)  the
                  applicable  Set Price  then in effect is such that the  shares
                  issuable under this Debenture on any Conversion  Date together
                  with the aggregate number of shares of Common Stock that would
                  then  be  issuable  upon   conversion  in  full  of  all  then
                  outstanding  Debentures would exceed the Issuable Maximum, and
                  (2) the  Company's  shareholders  shall  not  have  previously
                  approved  the  transactions  contemplated  by the  Transaction
                  Documents,  as may be  required  by the  applicable  rules and
                  regulations of the Principal Market (or any successor entity),
                  if any (the  "Shareholder  Approval"),  then the Company shall
                  issue to the Holder requesting a conversion a number of shares
                  of Common Stock equal to such Holder's pro-rata portion (which
                  shall be  calculated  pursuant  to the  terms  hereof)  of the
                  Issuable  Maximum and,  with  respect to the  remainder of the
                  aggregate  principal  amount of the Debentures  (including any
                  accrued  interest)  then  held  by  such  Holder  for  which a
                  conversion in accordance with the applicable  conversion price
                  would  result in an  issuance  of  shares  of Common  Stock in
                  excess  of such  Holder's  pro-rata  portion  (which  shall be
                  calculated  pursuant  to the  terms  hereof)  of the  Issuable
                  Maximum  (the  "Excess  Principal"),   the  Company  shall  be
                  prohibited from converting  such Excess  Principal,  and shall
                  notify the Holder of the reason therefor. This Debenture shall
                  thereafter  be  unconvertible  to such extent until and unless
                  Shareholder Approval is subsequently  obtained or is otherwise
                  not required,  but this Debenture  shall  otherwise  remain in
                  full force and effect.

                           (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


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                  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 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 and (B) a bank
         check in the amount of accrued and unpaid interest.  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.


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                  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 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


<PAGE>


         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
         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  $0.10  (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


<PAGE>


         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.

                  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,


<PAGE>


         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 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.


<PAGE>


         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:


                  "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  Sections   4(a)(ii)(A)  and
         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.

                  "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 March 5, 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 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


<PAGE>


service  shall  constitute  good and  sufficient  service of process  and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve  process in any manner  permitted  by law.  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



<PAGE>



                                                                         ANNEX A

                              NOTICE OF CONVERSION


The undersigned hereby elects to convert principal under the Secured Convertible
Debenture of Usurf America, Inc. (the "Company"), due on September__, 2005, 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:

                                Number of shares of Common Stock to be issued:


                                Signature:

                                Name:

                                Address:



<PAGE>




                                   SCHEDULE 1

                               CONVERSION SCHEDULE

Secured  Convertible  Debentures  due on September  ___,  2005, 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>



<PAGE>