<PAGE>

         THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
         REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
         "ACT"). SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED OR
         ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
         FOR THE SECURITIES UNDER SAID ACT, OR AN OPINION OF COUNSEL IN
         FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO COUNSEL
         TO THE BORROWER THAT REGISTRATION IS NOT REQUIRED UNDER SAID
         ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.



                              CONVERTIBLE DEBENTURE


March 10, 2000                                                       $10,000,000

         FOR VALUE RECEIVED, LEARN2.COM, INC., a Delaware corporation
(hereinafter called the "BORROWER"), hereby promises to pay to the order of RGC
INTERNATIONAL INVESTORS, LDC or registered assigns (the "HOLDER") the sum of Ten
Million Dollars ($10,000,000), on March 10, 2003 (the "MATURITY DATE"), and to
pay interest on the unpaid principal balance hereof at the rate of six percent
(6%) per annum from March 10, 2000 (the "ISSUE DATE") until the same becomes due
and payable, whether at maturity or upon acceleration or otherwise. Any amount
of principal or interest on this Debenture which is not paid when due shall bear
interest at the rate of fifteen percent (15%) per annum from the due date
thereof until the same is paid ("DEFAULT INTEREST"). Interest shall commence
accruing on the Issue Date, shall be computed on the basis of a 365-day year and
the actual number of days elapsed and shall be payable at the time of optional
conversion of the principal to which such interest relates in accordance with
Article I below or, to the extent not converted, at maturity or upon
acceleration in accordance with the terms hereof. All payments due hereunder (to
the extent not converted into Common Stock, par value $0.01 per share, of the
Borrower (the "COMMON STOCK") in accordance with the terms hereof) shall be made
in lawful money of the United States of America or, at the option of the
Borrower, in whole or in part, in shares of Common Stock valued at ninety-five
percent (95%) of the average of the volume weighted average prices of the Common
Stock for each Trading Day during the ten (10) consecutive Trading Day (as
defined below) period ending on the Maturity Date; PROVIDED, HOWEVER, that in no
event shall the Borrower be entitled to issue to the Holder shares of Common
Stock to the extent, but only to the extent, that such issuance would, when
aggregated with all other shares of Common Stock held by the Holder and its
affiliates on the Maturity Date,




                                              1

<PAGE>



result in beneficial ownership by the Holder and its affiliates of more than
9.9% of the outstanding shares of Common Stock of the Borrower, with beneficial
ownership being determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), and Regulations 13D-G
thereunder; and, PROVIDED, FURTHER, that in no event shall the Borrower be
entitled to issue to the Holder shares of Common Stock in payment of this
Debenture on the Maturity Date unless (i) all of the shares of Common Stock to
be so issued are then (x) authorized and reserved for issuance, (y) registered
for re-sale under the Securities Act of 1933, as amended (the "1933 ACT"), by
the Holder of this Debenture (or may otherwise be resold publicly without
restriction) and (z) eligible to be traded on the Nasdaq National Market (the
"NNM"), the Nasdaq SmallCap Market (the "NASDAQ SMALLCAP"), the New York Stock
Exchange ("NYSE") or the American Stock Exchange ("AMEX") and (ii) there is not
then a continuing Event of Default (as hereinafter defined) or Trading Market
Redemption Event (as hereinafter defined) and such issuance would not result in
the occurrence of a Trading Market Redemption Event. All payments shall be made
at such address as the Holder shall hereafter give to the Borrower by written
notice made in accordance with the provisions of this Debenture. Whenever any
amount expressed to be due by the terms of this Debenture is due on any day
which is not a business day, the same shall instead be due on the next
succeeding day which is a business day. Except as otherwise expressly provided
herein, this Debenture may not be prepaid by the Borrower. As used in this
Debenture, the term "business day" shall mean any day other than a Saturday,
Sunday or a day on which commercial banks in the City of New York, New York are
authorized or required by law or executive order to remain closed. Each
capitalized term used herein, and not otherwise defined, shall have the meaning
ascribed thereto in that certain Securities Purchase Agreement, dated March 10,
2000, pursuant to which this Debenture was originally issued (the "PURCHASE
AGREEMENT"). For purposes hereof, the term "Debentures" shall be deemed to refer
to this Debenture, all other convertible debentures issued pursuant to the
Purchase Agreement and all convertible debentures issued in replacement hereof
or thereof or otherwise with respect hereto or thereto.

         The following terms shall apply to this Debenture:


                          ARTICLE I. CONVERSION RIGHTS

         1.1      CONVERSION RIGHT.

                  (a)      CONVERSION AMOUNT. Subject to the limitations on
conversion contained herein, the Holder shall have the right from time to time,
and at any time on or prior to the earlier of (i) the Maturity Date and (ii) the
date of payment of the Default Amount (as defined in Article III) pursuant to
Article III or Section 1.6 hereof and (iii) the date of payment of the Optional
Redemption Amount (as defined in Article IV) pursuant to Article IV, to convert
all or any part of the outstanding and unpaid principal amount of this Debenture
into fully paid and non-assessable shares of Common Stock, as such Common Stock
exists on the Issue Date, or any shares of capital stock or other securities of
the Borrower into which such Common Stock shall hereafter be changed or
reclassified, at the Conversion Price (as defined in Section 1.2 below)
determined as provided herein (a "CONVERSION"); PROVIDED, HOWEVER, that in no
event shall the Holder be entitled to convert




                                        2

<PAGE>



any portion of this Debenture in excess of that portion of this Debenture upon
conversion of which the sum of (1) the number of shares of Common Stock
beneficially owned by the Holder and its affiliates (other than shares of Common
Stock which may be deemed beneficially owned through the ownership of the
unconverted portion of the Debentures, the unexercised Warrants or the
unexercised or unconverted portion of any other security of the Borrower subject
to a limitation on conversion or exercise analogous to the limitations contained
herein) and (2) the number of shares of Common Stock issuable upon the
conversion of the portion of this Debenture with respect to which the
determination of this proviso is being made, would result in beneficial
ownership by the Holder and its affiliates of more than 4.99% of the outstanding
shares of Common Stock. For purposes of the proviso to the immediately preceding
sentence and for purposes of the first proviso of the lead-in to this Debenture,
(i) beneficial ownership shall be determined in accordance with Section 13(d) of
the Exchange Act and Regulations 13D-G thereunder, except as otherwise provided
in clause (1) of such proviso to the immediately preceding sentence and (ii)
neither of such provisos may be amended without the consent of the Holder, the
Borrower and a majority of the stockholders of the Borrower. The number of
shares of Common Stock to be issued upon each conversion of this Debenture shall
be determined by dividing the Conversion Amount (as defined below) by the
applicable Conversion Price. The term "CONVERSION AMOUNT" means, with respect to
any conversion of this Debenture, the sum of (1) the principal amount of this
Debenture to be converted in such conversion, PLUS (2) all accrued and unpaid
interest thereon for the period beginning on the Issue Date and ending on the
Conversion Date (as defined in Section 1.4 hereof), PLUS (3) Default Interest,
if any, on the amounts referred to in the immediately preceding clauses (1)
and/or (2), PLUS (4) at the Holder's option, any amounts owed to the Holder
pursuant to Sections 1.3 and 1.4(e) hereof or pursuant to Section 2(c) of that
certain Registration Rights Agreement, dated as of March 10, 2000, executed in
connection with the initial issuance of this Debenture and the other Debentures
issued on the Issue Date (the "REGISTRATION RIGHTS AGREEMENT").

         1.2      CONVERSION PRICE.

                  (a)      Subject to the provisions of Section 1.5 below, the
"CONVERSION PRICE" shall be $6.00 (the "INITIAL CONVERSION PRICE") (subject to
equitable adjustments for stock splits, stock dividends or rights offerings by
the Borrower relating to the Borrower's securities or the securities of any
subsidiary of the Borrower, combinations, recapitalization, reclassifications,
extraordinary distributions and similar events).

                  (b)      In the event that the average of the volume weighted
average prices of the Common Stock for each Trading Day (as defined below)
during the ten (10) consecutive Trading Day period ending on the one-year
anniversary of the Issue Date (the "FIRST ADJUSTED CONVERSION PRICE") is less
than the Initial Conversion Price, then the Conversion Price shall, beginning on
the Trading Day next following the one-year anniversary of the Issue Date and at
all times thereafter, equal the First Adjusted Conversion Price unless the
Borrower elects, by written notice delivered to the Holder in accordance with
the provisions of Article IV hereof, to redeem this Debenture pursuant to
Article IV hereof, PROVIDED, HOWEVER, that (x) if the Registration Statement (as
defined in the Registration Rights Agreement) required to be filed pursuant to
Section 2(a) of the Registration Rights Agreement has not been declared
effective by the SEC prior to the tenth (10th)



                                        3

<PAGE>



Trading Day immediately preceding the one-year anniversary of the Issue Date or
(y) such Registration Statement after its initial effectiveness lapses in effect
or sales of all of the Registrable Securities (as defined in the Registration
Rights Agreement) otherwise cannot be made thereunder, whether by reason of the
Borrower's failure or inability to amend or supplement the prospectus (the
"PROSPECTUS") included therein in accordance with the Registration Rights
Agreement or otherwise, after such Registration Statement becomes effective
(including, without limitation, during an Allowed Delay (as defined in Section
3(f) of the Registration Statement)), then the First Adjusted Conversion Price
shall equal the lowest average of the volume weighted average prices of the
Common Stock for each Trading Day during any ten (10) consecutive Trading Day
period beginning on the tenth (10th) Trading Day immediately preceding the
one-year anniversary of the Issue Date and ending on the tenth (10th) Trading
Day following (i) in the case of an event described in clause (x) of this
proviso, the date on which the Registration Statement is declared effective, or
(ii) in the case of an event described in clause (y) of this proviso, the date
on which the Holder is first notified that sales of all of the Registrable
Securities may again be made under the Prospectus. The Conversion Price (whether
by reference to the Initial Conversion Price or the First Adjusted Conversion
Price) shall be subject to adjustment pursuant to the provisions of Section 1.5.
The "VOLUME WEIGHTED AVERAGE PRICE" for any security as of any date means the
volume weighted average sale price on the NNM as reported by Bloomberg Financial
Markets or an equivalent, reliable reporting service mutually acceptable to and
hereafter designated by holders of a majority in interest of the Debentures and
the Borrower ("BLOOMBERG") or, if the NNM is not the principal trading market
for such security, the volume weighted average sale price of such security on
the principal securities exchange or trading market where such security is
listed or traded as reported by Bloomberg, or if the foregoing do not apply, the
volume weighted average sale price of such security in the over-the-counter
market on the electronic bulletin board for such security, as reported by
Bloomberg, or, if no volume weighted average sale price of such security is
available in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no volume weighted average sale
price is reported for such security, then the last closing trade price of such
security as reported by Bloomberg, or, if no last closing trade price is
reported for such security by Bloomberg, the average of the bid prices of any
market makers for such security that are listed in the "pink sheets" by the
National Quotation Bureau, Inc. If the volume weighted average price cannot be
calculated for such security on such date in the manner provided above, the
volume weighted average price shall be the fair market value as mutually
determined by the Borrower and the holders of a majority in interest of the
Debentures being converted for which the calculation of the volume weighted
average price is required in order to determine the Conversion Price of such
Debentures. "TRADING DAY" shall mean any day on which the Common Sock is traded
for any period on the NNM, or on the principal securities exchange or other
securities market on which the Common Stock is then being traded.

                  (c)      In the event that the average of the volume weighted
average prices of the Common Stock for each Trading Day during the ten (10)
consecutive Trading Day period ending on the two-year anniversary of the Issue
Date (the "SECOND ADJUSTED CONVERSION PRICE") is less than the Conversion Price
then in effect, then the Conversion Price shall, beginning on the Trading Day
next following the two-year anniversary of the Issue Date and at all times
thereafter, equal the Second Adjusted Conversion Price unless the Borrower
elects, by written notice delivered




                                        4

<PAGE>



to the Holder in accordance with the provisions of Article IV hereof, to redeem
this Debenture pursuant to Article IV hereof, PROVIDED, FURTHER, HOWEVER, that
(x) if the Registration Statement (as defined in the Registration Rights
Agreement) required to be filed pursuant to Section 2(a) of the Registration
Rights Agreement has not been declared effective by the SEC prior to the tenth
(10th) Trading Day immediately preceding the two-year anniversary of the Issue
Date or (y) such Registration Statement after its initial effectiveness lapses
in effect or sales of all of the Registrable Securities (as defined in the
Registration Rights Agreement) otherwise cannot be made thereunder, whether by
reason of the Borrower's failure or inability to amend or supplement the
Prospectus included therein in accordance with the Registration Rights Agreement
or otherwise, after such Registration Statement becomes effective (including,
without limitation, during an Allowed Delay (as defined in Section 3(f) of the
Registration Statement)), then the Second Adjusted Conversion Price shall equal
the lowest average of the volume weighted average prices of the Common Stock for
each Trading Day during any ten (10) consecutive Trading Day period beginning on
the tenth (10th) Trading Day immediately preceding the two-year anniversary of
the Issue Date and ending on the tenth (10th) Trading Day following (i) in the
case of an event described in clause (x) of this proviso, the date on which the
Registration Statement is declared effective, or (ii) in the case of an event
described in clause (y) of this proviso, the date on which the Holder is first
notified that sales of all of the Registrable Securities may again be made under
the Prospectus. The Conversion Price shall thereafter be subject to adjustment
pursuant to the provisions of Section 1.5.

                  (d)      Notwithstanding anything to the contrary contained in
this Debenture, the Conversion Price shall not be subject to an initial
adjustment pursuant to Section 1.5(b) above or to a subsequent adjustment
pursuant to Section 1.5(c) above if, prior to the one-year anniversary of the
Issue Date or prior to the two-year anniversary of the Issue Date, as
applicable, the average of the volume weighted average prices of the Common
Stock for each Trading Day during any twenty (20) consecutive Trading Day period
is greater than 150% of the Initial Conversion Price, so long as for at all
times during such twenty (20) Trading Day period, (i) all of the shares of
Common Stock issuable upon conversion of the Debentures are then (x) authorized
and reserved for issuance, (y) registered for resale under the 1933 Act by the
Holders of the Debentures and sales of such shares may be made thereunder (or
such shares may otherwise be resold publicly without restriction) and (z)
eligible to be traded on the NNM, the Nasdaq SmallCap, the NYSE or the AMEX, and
(ii) no Event of Default or Trading Market Redemption Event shall have occurred
and be continuing.

         1.3      RESERVATION OF SHARES. The Borrower covenants that during the
period the conversion right exists, the Borrower will reserve from its
authorized and unissued Common Stock a sufficient number of shares, free from
preemptive rights, to provide for the issuance of Common Stock upon the full
conversion of this Debenture and the other Debentures issued pursuant to the
Purchase Agreement. As of the date of issuance of this Debenture, 3,333,334
authorized and unissued shares of Common Stock have been duly reserved for
issuance upon conversion of this Debenture and the other Debentures issued
pursuant to the Purchase Agreement (the "RESERVED AMOUNT"). The Reserved Amount
shall be increased from time to time in accordance with the Borrower's
obligations pursuant to Section 4(h) of the Purchase Agreement. The Borrower
represents that upon issuance, such shares will be duly and validly issued,
fully paid and non-



                                       5
<PAGE>



assessable. In addition, if the Borrower shall issue any securities or make any
change to its capital structure which would change the number of shares of
Common Stock into which the Debentures shall be convertible at the then
applicable Conversion Price, the Borrower shall at the same time make proper
provision so that thereafter there shall be a sufficient number of shares of
Common Stock authorized and reserved, free from preemptive rights, for
conversion of the outstanding Debentures. The Borrower (i) acknowledges that it
has irrevocably instructed its transfer agent to issue certificates for the
Common Stock issuable upon conversion of this Debenture and (ii) agrees that its
issuance of this Debenture shall constitute full authority to its officers and
agents who are charged with the duty of executing stock certificates to execute
and issue the necessary certificates for shares of Common Stock in accordance
with the terms and conditions of this Debenture.

         If, at any time a Holder of this Debenture submits a Notice of
Conversion, and the Borrower does not have sufficient authorized but unissued
shares of Common Stock available to effect such conversion in accordance with
the provisions of this Article I (a "CONVERSION DEFAULT"), subject to Section
5.8, the Borrower shall issue to the Holder all of the shares of Common Stock
which are then available to effect such conversion. The portion of this
Debenture which the Holder included in its Conversion Notice and which exceeds
the amount which is then convertible into available shares of Common Stock (the
"EXCESS AMOUNT") shall, notwithstanding anything to the contrary contained
herein, not be convertible into Common Stock in accordance with the terms hereof
until (and at the Holder's option at any time after) the date additional shares
of Common Stock are authorized and duly reserved for issuance by the Borrower to
permit such conversion. The Borrower shall pay to the Holder payments
("CONVERSION DEFAULT PAYMENTS") for a Conversion Default in the amount of (x)
the SUM OF (1) the then outstanding principal amount of this Debenture, PLUS (2)
all accrued and unpaid interest thereon through the Authorization Date (as
defined below), PLUS (3) Default Interest, if any, on the amounts referred to in
clauses (1) and/or (2), MULTIPLIED BY (y) .24, MULTIPLIED BY (z) (N/365), where
N = the number of days from the day the Holder submits a Notice of Conversion
giving rise to a Conversion Default (the "CONVERSION DEFAULT DATE") to the date
(the "AUTHORIZATION DATE") that the Borrower authorizes a sufficient number of
shares of Common Stock to effect conversion of the full outstanding principal
balance of this Debenture. The Borrower shall use its best efforts to authorize
a sufficient number of shares of Common Stock as soon as practicable following
the earlier of (i) such time that the Holder notifies the Borrower or that the
Borrower otherwise becomes aware that there are or likely will be insufficient
authorized and unissued shares to allow full conversion thereof and (ii) a
Conversion Default. The Borrower shall send notice to the Holder of the
authorization of additional shares of Common Stock, the Authorization Date and
the amount of the Holder's accrued Conversion Default Payments. The accrued
Conversion Default Payments for each calendar month shall be paid in cash on or
before the fifth (5th) day of the month following the month in which they have
accrued, PROVIDED that if such amounts have not been paid in cash on or before
such date, at the option of the Holder (by written notice to the Borrower), such
payments shall be added to the principal amount of this Debenture, in which
event interest shall accrue thereon in accordance with the terms of this
Debenture and such additional principal amount shall be convertible into Common
Stock in accordance with the terms of this Debenture. Nothing herein shall limit
the Holder's right to pursue actual damages (to the extent in excess of the
Conversion Default Payments) for the Borrower's failure to maintain a sufficient
number of authorized shares of Common Stock, and each Holder shall have the
right to



                                       6
<PAGE>



pursue all remedies available at law or in equity (including a decree of
specific performance and/or injunctive relief).

         1.4      METHOD OF CONVERSION.

                  (a)      MECHANICS OF CONVERSION. Subject to Section 1.1 and
the other provisions of this Debenture, this Debenture may be converted by the
Holder in whole or in part at any time and from time to time after the Issue
Date, by (A) submitting to the Borrower a duly executed notice of conversion in
the form attached hereto as Exhibit A ("NOTICE OF CONVERSION") by facsimile
dispatched prior to Midnight, New York City time (the "CONVERSION NOTICE
DEADLINE") on the date specified therein on the Conversion Date (as defined
below) (or by other means resulting in, or reasonably expected to result in,
written notice to the Borrower on the date specified therein as the Conversion
Date) to the office of the Borrower; which notice shall specify the principal
amount of this Debenture to be converted, the applicable Conversion Price, and
the number of shares of Common Stock issuable upon such conversion; and (B)
subject to Section 1.4(b), surrendering this Debenture at the principal office
of the Borrower.

                  (b)      SURRENDER OF DEBENTURE UPON CONVERSION.
Notwithstanding anything to the contrary set forth herein, upon conversion of
this Debenture in accordance with the terms hereof, the Holder shall not be
required to physically surrender this Debenture to the Borrower unless the
entire unpaid principal amount of this Debenture is so converted. The Holder and
the Borrower shall maintain records showing the principal amount so converted
and the dates of such conversions or shall use such other method, reasonably
satisfactory to the Holder and the Borrower, so as not to require physical
surrender of this Debenture upon each such conversion. In the event of any
dispute or discrepancy, such records of the Borrower shall be controlling and
determinative in the absence of manifest error. Notwithstanding the foregoing,
if any portion of this Debenture is converted as aforesaid, the Holder may not
transfer this Debenture unless the Holder first physically surrenders this
Debenture to the Borrower, whereupon the Borrower will forthwith issue and
deliver upon the order of the Holder a new Debenture of like tenor, registered
as the Holder (upon payment by the Holder of any applicable transfer taxes) may
request, representing in the aggregate the remaining unpaid principal amount of
this Debenture. 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 represented by this Debenture may be less
than the amount stated on the face hereof

                  (c)      PAYMENT OF TAXES. The Borrower shall not be required
to pay any tax which may be payable in respect of any transfer involved in the
issue and delivery of shares of Common Stock or other securities or property on
conversion of this Debenture in a name other than that of the Holder (or in
street name), and the Borrower shall not be required to issue or deliver any
such shares or other securities or property unless and until the person or
persons (other than the Holder or the custodian in whose street name such shares
are to be held for the Holder's account) requesting the issuance thereof shall
have paid to the Borrower the amount of any such tax or shall have established
to the satisfaction of the Borrower that such tax has been paid.



                                       7
<PAGE>



                  (d)      LOST OR STOLEN DEBENTURES. Upon receipt by the
Borrower of evidence of the loss, theft, destruction or mutilation of this
Debenture, and (in the case of loss, theft or destruction) of indemnity
reasonably satisfactory to the Borrower, and upon surrender and cancellation of
this Debenture, if mutilated, the Borrower shall execute and deliver a new
Debenture of like tenor and date.

                  (e)      DELIVERY OF COMMON STOCK UPON CONVERSION. Upon
submission of a notice of Conversion, the Borrower shall, within three business
days after the Conversion Date (the "DELIVERY PERIOD"), issue and deliver (or
cause its Transfer Agent so to issue and deliver) in accordance with the terms
hereof and the Purchase Agreement (including, without limitation, in accordance
with the requirements of Section 2(g) of the Purchase Agreement) to or upon the
order of the Holder that number of shares of Common Stock for the portion of
this Debenture converted as shall be determined in accordance herewith. In
addition to any other remedies available to the Holder, including actual damages
and/or equitable relief, the Borrower shall pay to the Holder $2,000 per day in
cash for each day beyond a two-day grace period following the Delivery Period
that the Borrower failed to deliver Common Stock (a "DELIVERY DEFAULT") issuable
upon conversion of this Debenture pursuant to the Notice of Conversion until
such time as the Borrower has delivered all such Common Stock (the "DELIVERY
DEFAULT PAYMENTS"); PROVIDED, HOWEVER, in the event of a failure by the Borrower
to deliver shares upon conversion as a result of a Conversion Default, the
Holder shall not be entitled to receive Delivery Default Payments but shall be
entitled to receive Conversion Default Payments in accordance with Section 1.3.
Such Delivery Default Payments shall be paid to the Holder on or before the
fifth (5th) day of the month following the month in which they have accrued,
PROVIDED that if such amounts have not been paid in cash on or before such date,
at the option of the Holder (by written notice to the Borrower), such payments
shall be added to the principal amount of this Debenture, in which event
interest shall accrue thereon in accordance with the terms of this Debenture and
such additional principal amount shall be convertible into Common Stock in
accordance with the terms of this Debenture.

                  In lieu of delivering physical certificates representing the
Common Stock issuable upon conversion, provided the Borrower's Transfer Agent is
participating in the Depository Trust Company ("DTC") Fast Automated Securities
Transfer ("FAST") program, upon written request of the Holder and its compliance
with the provisions contained in Section 1.1 and in this Section 1.4, the
Borrower shall use its best efforts to cause its Transfer Agent to
electronically transmit the Common Stock issuable upon conversion to the Holder
by crediting the account of the Holder's Prime Broker with DTC through its
Deposit Withdrawal Agent Commission ("DWAC") system. The time periods for
delivery and penalties described in the immediately preceding paragraph shall
apply to the electronic transmittals described herein.

                  (f)      OBLIGATION OF BORROWER TO DELIVER COMMON STOCK.
Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be
deemed to be the holder of record of the Common Stock issuable upon such
conversion, the outstanding principal amount and the amount of accrued and
unpaid interest on this Debenture shall be reduced to reflect such conversion,
and, unless the Borrower defaults on its obligations hereunder, all rights with
respect to the portion of this Debenture being so converted shall forthwith
terminate except the right to receive the



                                       8
<PAGE>



Common Stock or other securities, cash or other assets, as herein provided, on
such conversion. If the Holder shall have given a Notice of Conversion as
provided herein, the Borrower's obligation to issue and deliver the certificates
for Common Stock shall be absolute and unconditional, irrespective of the
absence of any action by the Holder to enforce the same, any waiver or consent
with respect to any provision thereof, the recovery of any judgment against any
person or any action to enforce the same, any failure or delay in the
enforcement of any other obligation of the Borrower to the holder of record, or
any setoff, counterclaim, recoupment, limitation or termination, or any breach
or alleged breach by the Holder of any obligation to the Borrower, and
irrespective of any other circumstance which might otherwise limit such
obligation of the Borrower to the Holder in connection with such conversion.

                  (g)      NO FRACTIONAL SHARES. If any conversion of this
Debenture would result in a fractional share of Common Stock or the right to
acquire a fractional share of Common Stock, such fractional share shall be
disregarded and the number of shares of Common Stock issuable upon conversion of
this Debenture shall be the next higher number of shares.

                  (h)      CONVERSION DATE. The "CONVERSION DATE" shall be the
date specified in the Notice of Conversion, provided that the Notice of
Conversion is submitted by facsimile (or by other means resulting in, or
reasonably expected to result in, written notice) to the Borrower or its
Transfer Agent before Midnight, New York City time, on the date so specified,
otherwise the Conversion Date shall be the first business day after the date so
specified (provided that the Notice of Conversion is actually received by the
Borrower or its Transfer Agent on such business day). The person or persons
entitled to receive the shares of Common Stock issuable upon conversion shall be
treated for all purposes as the record holder or holders of such securities as
of the Conversion Date and all rights with respect to this Debenture (or portion
thereof surrendered shall forthwith terminate except the rights set forth in
Sections 1.4(f) and Section 1.7 hereof.

         1.5      EFFECT OF CERTAIN EVENTS.

                  (a)      EFFECT OF MERGER, CONSOLIDATION, ETC. At the option
of the Holder, the sale, conveyance or disposition of all or substantially all
of the assets of the Borrower, the effectuation by the Borrower of a transaction
or series of related transactions in which more than 50% of the voting power of
the Borrower is disposed of, or the consolidation, merger or other business
combination of the Borrower with or into any other Person (as defined below) or
Persons when the Borrower is not the survivor shall either: (i) be deemed to be
an Event of Default (as defined in Article III) pursuant to which the Borrower
shall be required to pay to the Holder upon the consummation of and as a
condition to such transaction an amount equal to the Default Amount (as defined
in Article III) or (ii) be treated pursuant to Section 1.5(b) hereof; PROVIDED,
HOWEVER, that in the event of a merger, consolidation or other business
combination of the Borrower with or into any other Person when the Borrower is
not the survivor but where the survivor is an entity whose common stock is
traded on the NNM, the AMEX or the NYSE, such transaction shall be treated
pursuant to Section 1.5(b) hereof . "PERSON" shall mean any individual,
corporation, limited liability company, partnership, association, trust or other
entity or organization.



                                        9
<PAGE>



                  (b)      ADJUSTMENT DUE TO MERGER, CONSOLIDATION, ETC. If, at
any time when this Debenture is issued and outstanding and prior to conversion
of all of the Debentures, there shall be any merger, consolidation, exchange of
shares, recapitalization, reorganization, or other similar event, as a result of
which shares of Common Stock of the Borrower shall be changed into the same or a
different number of shares of another class or classes of stock or securities of
the Borrower or another entity, or in case of any sale or conveyance of all or
substantially all of the assets of the Borrower other than in connection with a
plan of complete liquidation of the Borrower (each, a "CHANGE OF CONTROL
TRANSACTION"), then the Holder of this Debenture shall thereafter have the right
to receive upon conversion of this Debenture, upon the basis and upon the terms
and conditions specified herein and in lieu of the shares of Common Stock
immediately theretofore issuable upon conversion, such stock, securities or
assets which the Holder would have been entitled to receive in such transaction
had this Debenture been converted in full immediately prior to such transaction
(without regard to any limitations on conversion set forth herein), and in any
such case appropriate provisions shall be made with respect to the rights and
interests of the Holder of this Debenture to the end that the provisions hereof
(including, without limitation, provisions for adjustment of the Conversion
Price and of the number of shares issuable upon conversion of the Debenture)
shall thereafter be applicable, as nearly as may be practicable in relation to
any securities or assets thereafter deliverable upon the conversion hereof. The
Borrower shall not effect any transaction described in this Section 1.5(b)
unless (a) it first gives, to the extent practicable, thirty (30) days prior
written notice (but in any event at least fifteen (15) business days prior
written notice) of the record date of the special meeting of shareholders to
approve, or if there is no such record date, the consummation of, such merger,
consolidation, exchange of shares, recapitalization, reorganization or other
similar event or sale of assets (during which time the Holder shall be entitled
to convert this Debenture) and (b) the resulting successor or acquiring entity
(if not the Borrower) and, if an entity different from the successor or
acquiring entity, the entity whose capital stock or assets the holders of Common
Stock are entitled to receive as a result of such Change of Control Transaction,
assumes by written instrument the obligations of this Debenture, including this
Section 1.5(b). The above provisions shall similarly apply to successive
consolidations, mergers, sales, transfers or share exchanges.

                  (c)      ADJUSTMENT DUE TO DISTRIBUTION. If the Borrower shall
declare or make any distribution of its assets (or rights to acquire its assets)
to holders of Common Stock as a dividend, stock repurchase, by way of return of
capital or otherwise (including any dividend or distribution to the Borrower's
shareholders in cash or shares (or rights to acquire shares) of capital stock of
a subsidiary (i.e., a spin-off)) (a "DISTRIBUTION"), then the Holder of this
Debenture shall be entitled, upon any conversion of this Debenture after the
date of record for determining shareholders entitled to such Distribution, to
receive the amount of such assets which would have been payable to the Holder
with respect to the shares of Common Stock issuable upon such conversion had
such Holder been the holder of such shares of Common Stock on the record date
for the determination of shareholders entitled to such Distribution.

                  (d)      PURCHASE RIGHTS. If, at any time when any Debentures
are issued and outstanding, the Borrower issues any convertible securities or
rights to purchase stock, warrants, securities or other property (the "PURCHASE
RIGHTS") pro rata to the record holders of any class of



                                       10
<PAGE>



Common Stock, then the Holder of this Debenture will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights
which such Holder could have acquired if such Holder had held the number of
shares of Common Stock acquirable upon complete conversion of this Debenture
(without regard to any limitations on conversion contained herein) immediately
before the date on which a record is taken for the grant, issuance or sale of
such Purchase Rights or, if no such record is taken, the date as of which the
record holders of Common Stock are to be determined for the grant, issue or sale
of such Purchase Rights.

                  (e)      ANTIDILUTION PROVISIONS. The Conversion Price shall
be subject to adjustment from time to time as provided in this Section 1.5(e).

                           (i)      ADJUSTMENT OF CONVERSION PRICE. If, and
whenever on or after the date of issuance of this Debenture, the Borrower issues
or sells, or in accordance with Section 1.5(c)(ii) hereof is deemed to have
issued or sold, any shares of Common Stock for no consideration or for a
consideration per share (before deduction of reasonable expenses or commissions
or underwriting discounts or allowances in connection therewith) less than the
Market Price (as hereinafter defined) on the date of such issuance (or deemed
issuance) of such shares of Common Stock (a "DILUTIVE ISSUANCE"), then
immediately upon the Dilutive Issuance, the Conversion Price will be reduced to
a price determined by multiplying the Conversion Price in effect immediately
prior to the Dilutive Issuance by a fraction, (i) the numerator of which is an
amount equal to the sum of (x) the number of shares of Common Stock actually
outstanding immediately prior to the Dilutive Issuance, plus (y) the quotient of
the aggregate consideration, calculated as set forth in Section 1.5(e)(ii)
hereof, received by the Borrower upon such Dilutive Issuance divided by the
Market Price in effect immediately prior to the Dilutive Issuance, and (ii) the
denominator of which is the total number of shares of Common Stock Deemed
Outstanding (as defined below) immediately after the Dilutive Issuance.

                           (ii)     EFFECT ON CONVERSION PRICE OF CERTAIN
EVENTS. For purposes of determining the adjusted Conversion Price under Section
1.5(e)(i) hereof, the following will be applicable:

                           A.       ISSUANCE OF RIGHTS OR OPTIONS. If the
Borrower in any manner issues or grants any warrants, rights or options, whether
or not immediately exercisable, to subscribe for or to purchase Common Stock or
other securities convertible into or exchangeable for Common Stock ("CONVERTIBLE
SECURITIES") (such warrants, rights and options to purchase Common Stock or
Convertible Securities are hereinafter referred to as "OPTIONS") and the price
per share for which Common Stock is issuable upon the exercise of such Options
is less than the Market Price on the date of issuance or grant of such Options,
then the maximum total number of shares of Common Stock issuable upon the
exercise of all such Options will, as of the date of the issuance or grant of
such Options, be deemed to be outstanding and to have been issued and sold by
the Borrower for such price per share. For purposes of the preceding sentence,
the "price per share for which Common Stock is issuable upon the exercise of
such Options" is determined by dividing (i) the total amount, if any, received
or receivable by the Borrower as consideration for the issuance or granting of
all such Options, plus the minimum aggregate amount of additional consideration,
if any, payable



                                       11
<PAGE>



to the Borrower upon the exercise of all such Options, plus, in the case of
Convertible Securities issuable upon the exercise of such Options, the minimum
aggregate amount of additional consideration payable upon the conversion or
exchange thereof at the time such Convertible Securities first become
convertible or exchangeable, by (ii) the maximum total number of shares of
Common Stock issuable upon the exercise of all such Options (assuming full
conversion of Convertible Securities, if applicable). No further adjustment to
the Conversion Price will be made upon the actual issuance of such Common Stock
upon the exercise of such Options or upon the conversion or exchange of
Convertible Securities issuable upon exercise of such Options.

                           B.       ISSUANCE OF CONVERTIBLE SECURITIES. If the
Borrower in any manner issues or sells any Convertible Securities, whether or
not immediately convertible (other than where the same are issuable upon the
exercise of Options), and the price per share for which Common Stock is issuable
upon such conversion or exchange is less than the Market Price on the date of
issuance of such Convertible Securities, then the maximum total number of shares
of Common Stock issuable upon the conversion or exchange of all such Convertible
Securities will, as of the date of the issuance of such Convertible Securities,
be deemed to be outstanding and to have been issued and sold by the Borrower for
such price per share. For the purposes of the preceding sentence, the "price per
share for which Common Stock is issuable upon such conversion or exchange" is
determined by dividing (i) the total amount, if any, received or receivable by
the Borrower as consideration for the issuance or sale of all such Convertible
Securities, plus the minimum aggregate amount of additional consideration, if
any, payable to the Borrower upon the conversion or exchange thereof at the time
such Convertible Securities first become convertible or exchangeable, by (ii)
the maximum total number of shares of Common Stock issuable upon the conversion
or exchange of all such Convertible Securities. No further adjustment to the
Conversion Price will be made upon the actual issuance of such Common Stock upon
conversion or exchange of such Convertible Securities.

                           C.       CHANGE IN OPTION PRICE OR CONVERSION RATE.
If there is a change at any time in (i) the amount of additional consideration
payable to the Borrower upon the exercise of any Options; (ii) the amount of
additional consideration, if any, payable to the Borrower upon the conversion or
exchange of any Convertible Securities; or (iii) the rate at which any
Convertible Securities are convertible into or exchangeable for Common Stock
(other than under or by reason of provisions designed to protect against
dilution), the Conversion Price in effect at the time of such change will be
readjusted to the Conversion Price which would have been in effect at such time
had such Options or Convertible Securities still outstanding provided for such
changed additional consideration or changed conversion rate, as the case may be,
at the time initially granted, issued or sold.

                           D.       TREATMENT OF EXPIRED OPTIONS AND UNEXERCISED
CONVERTIBLE SECURITIES. If, in any case, the total number of shares of Common
Stock issuable upon exercise of any Option or upon conversion or exchange of any
Convertible Securities is not, in fact, issued and the rights to exercise such
Option or to convert or exchange such Convertible Securities shall have expired
or terminated, the Conversion Price then in effect will be readjusted to the
Conversion Price which would have been in effect at the time of such expiration
or termination had



                                       12
<PAGE>



such Option or Convertible Securities, to the extent outstanding immediately
prior to such expiration or termination (other than in respect of the actual
number of shares of Common Stock issued upon exercise or conversion thereof),
never been issued.

                           E.       CALCULATION OF CONSIDERATION RECEIVED. If
any Common Stock, Options or Convertible Securities are issued, granted or sold
for cash, the consideration received therefor for purposes of this Debenture
will be the amount received by the Borrower therefor, before deduction of
reasonable commissions, underwriting discounts or allowances or other reasonable
expenses paid or incurred by the Borrower in connection with such issuance,
grant or sale. In case any Common Stock, Options or Convertible Securities are
issued or sold for a consideration part or all of which shall be other than
cash, the amount of the consideration other than cash received by the Borrower
will be the fair value of such consideration, except where such consideration
consists of securities, in which case the amount of consideration received by
the Borrower will be the Market Price (as defined below) thereof as of the date
of receipt. In case any Common Stock, Options or Convertible Securities are
issued in connection with any acquisition, merger or consolidation in which the
Borrower is the surviving corporation, the amount of consideration therefor will
be deemed to be the fair value of such portion of the net assets and business of
the non-surviving corporation as is attributable to such Common Stock, Options
or Convertible Securities, as the case may be. The fair value of any
consideration other than cash or securities will be determined in good faith by
the Board of Directors of the Borrower.

                           F.       EXCEPTIONS TO ADJUSTMENT OF CONVERSION
PRICE. No adjustment to the Conversion Price will be made: (i) upon the exercise
of any warrants, options or convertible securities granted, issued and
outstanding on the date of issuance of this Debenture; (ii) upon the grant or
exercise of any stock or options which may hereafter be granted or exercised
under any employee benefit plan of the Borrower now existing or to be
implemented in the future, so long as the issuance of such stock or options is
approved by a majority of the independent members of the Board of Directors of
the Borrower or a majority of the members of a committee of independent
directors established for such purpose; (iii) upon the conversion of the
Debentures; (iv) upon the issuance, within 180 days of the Closing Date (as
defined in the Purchase Agreement), in a single transaction to a Strategic
Investor (as defined below) of (A) up to $10 million of Common Stock (or
securities convertible into Common Stock) for a price per share of Common Stock
(or, in the case of convertible securities, having a conversion price per share
of Common Stock) of not less than 80% of the Market Price in effect on the date
of issuance of such Common Stock (or security convertible into Common Stock) and
(B) options or warrants to purchase up to 19.99% of the outstanding Common Stock
of the Borrower at an exercise price per share of Common Stock of not less than
80% of the Market Price in effect on the date of issuance of such options or
warrants; or (v) upon the issuance, simultaneous with the closing of the
transactions referred to in clause (iv) above, to an executive officer of the
Strategic Investor of options to purchase up to one million shares of Common
Stock at an exercise price per share of Common Stock of not less than $4.00 in
connection with such individual's agreement to serve on the Board of Directors
of the Borrower following the closing of the transactions described in clause
(iv) above; PROVIDED, HOWEVER, that in the case of the events described in
clauses (iv) and (v) hereof, if the Market Price of the Common Stock in effect
on the thirtieth (30th) calendar day following the public announcement of the
material



                                       13
<PAGE>



terms of such transactions is less than the Market Price of the Common Stock in
effect on the Trading Day immediately preceding the public announcement of the
material terms of such transactions, then the Conversion Price shall be subject
to adjustment effective on the later of (x) the thirtieth (30th) calendar day
following the public announcement of the material terms of such transactions and
(y) the date of consummation of such transactions, in accordance with the
provisions of Section 1.5(e)(i) hereof on the same basis as if the transactions
set forth in clauses (iv) and (v) hereof were not excepted hereby; and PROVIDED,
FURTHER, HOWEVER, that the transactions set forth in clauses (iv) and (v) hereof
will not be excepted from the provisions of Section 1.5(e)(i) hereof pursuant
hereto if the public announcement of the material terms of such transactions
precedes the consummation of such transactions by more than seventy-five (75)
calendar days. "STRATEGIC INVESTOR" shall mean a corporation (or a wholly-owned
subsidiary thereof) whose capital stock is listed for trading on one of the
NYSE, AMEX or NNM, has a market capitalization at the time of its investment in
the Borrower of not less than $1 billion and whose principal business is
advertising and marketing services (including Internet applications relating
thereto).

                           (iii)    SUBDIVISION OR COMBINATION OF COMMON STOCK.
If the Borrower at any time subdivides (by any stock split, stock dividend,
recapitalization, reorganization, reclassification or otherwise) the shares of
Common Stock acquirable hereunder into a greater number of shares, then, after
the date of record for effecting such subdivision, the Conversion Price in
effect immediately prior to such subdivision will be proportionately reduced. If
the Borrower at any time combines (by reverse stock split, recapitalization,
reorganization, reclassification or otherwise) the shares of Common Stock
acquirable hereunder into a smaller number of shares, then, after the date of
record for effecting such combination, the Conversion Price in effect
immediately prior to such combination will be proportionately increased.

                           (iv)     CERTAIN DEFINITIONS.

                           A.       "MARKET PRICE," for any security as of any
date, (i) means the average of the last reported sale prices for such security
on the NNM for the five (5) Trading Days immediately preceding such date as
reported by Bloomberg, L.P. ("BLOOMBERG"), or (ii) if the NNM is not the
principal trading market for such security, the average of the last reported
sale prices on the principal trading market for such security during the same
period as reported by Bloomberg, or (iii) if market value cannot be calculated
as of such date on any of the foregoing bases, the Market Price shall be the
fair market value as reasonably determined in good faith by (a) the Board of
Directors of the Borrower or (b) at the option of a majority-in-interest of the
holders of the outstanding Debentures, by an independent investment bank of
nationally recognized standing in the valuation of businesses similar to the
business of the issuing corporation.

                           B.       "COMMON STOCK," for purposes of this Section
1.5(e), includes the Common Stock, par value $0.01 per share, and any additional
class of stock of the Borrower having no preference as to dividends or
distributions on liquidation, provided that the shares purchasable pursuant to
this Debenture shall include only shares of Common Stock, no par value per
share, in respect of which this Debenture is exercisable, or shares resulting
from any



                                       14
<PAGE>



subdivision or combination of such Common Stock, or any reorganization,
reclassification, consolidation or merger involving the Borrower.

                           C.       "COMMON STOCK DEEMED OUTSTANDING" shall mean
the number of shares of Common Stock actually outstanding (not including shares
of Common Stock held in the treasury of the Borrower), plus (x) pursuant to
Section 1.5(e)(ii)(A) hereof, the maximum total number of shares of Common Stock
issuable upon the exercise of Options, as of the date of such issuance or grant
of such Options, if any, and (y) pursuant to Section 1.5(e)(ii)(B) hereof, the
maximum total number of shares of Common Stock issuable upon conversion or
exchange of Convertible Securities, as of the date of issuance of such
Convertible Securities, if any.

                  (f)      NOTICE OF ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Conversion Price as a result of the events
described in this Section 1.5, the Borrower, at its expense, shall promptly
compute such adjustment or readjustment and prepare and furnish to the Holder of
a certificate setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is based. The
Borrower shall, upon the written request at any time of the Holder, furnish to
such Holder a like certificate setting forth (i) such adjustment or
readjustment, (ii) the Conversion Price at the time in effect and (iii) the
number of shares of Common Stock and the amount, if any, of other securities or
property which at the time would be received upon conversion of the Debenture.

         1.6      TRADING MARKET LIMITATIONS. Unless (i) permitted by the
applicable rules and regulations of the principal securities market on which the
Common Stock is then listed or traded or (ii) the Borrower has obtained approval
of the issuance of Common Stock upon conversion of the Debentures in accordance
with applicable law and the rules and regulations of any stock exchange,
interdealer quotation system or other self-regulatory organization with
jurisdiction over the Borrower or any of its securities (the "STOCKHOLDER
APPROVAL"), in no event shall the total number of shares of Common Stock issued
upon conversion of this Debenture and the other Debentures issued pursuant to
the Purchase Agreement (including any shares of capital stock or rights to
acquire shares of capital stock issued by the Borrower which are aggregated or
integrated with the Common Stock issued or issuable upon conversion of the
Debentures for purposes of any such rule or regulation) exceed the maximum
number of shares of Common Stock that the Borrower can issue pursuant to any
rule of the principal United States securities market on which the Common Stock
is then traded (including Rule 4460(i) of Nasdaq) (the "MAXIMUM SHARE AMOUNT"),
which, as of the Issue Date shall be 10,485,478 shares (19.99% of the total
shares outstanding on the Issue Date), subject to adjustment from time to time
for stock splits, stock dividends, combinations, capital reorganizations and
similar events relating to the Common Stock occurring after the Issue Date. With
respect to each Holder of Debentures, the Maximum Share Amount shall refer to
such Holder's PRO RATA share thereof determined in accordance with Section 5.8
below. In the event that the sum of (i) the aggregate number of shares of Common
Stock issued upon conversion of this Debenture and the other Debentures issued
pursuant to the Purchase Agreement PLUS (ii) the aggregate number of shares of
Common Stock that remain issuable upon conversion of this Debenture and the
other Debentures issued pursuant to the Purchase Agreement, represents at least
one hundred percent (100%) of the Maximum Share Amount (the "TRIGGERING EVENT"),
the Borrower will use its best



                                       15
<PAGE>



efforts to seek and obtain Stockholder Approval (or obtain such other relief as
will allow conversions hereunder in excess of the Maximum Share Amount) as soon
as practicable following the Triggering Event. If any Debentures cease to be
convertible as a result of the limitations described in this Section 1.6 (a
"TRADING MARKET REDEMPTION EVENT"), and the Borrower has not prior to, or within
thirty (30) days of the date that such Trading Market Redemption Event arises,
(i) obtained the Stockholder Approval or (ii) eliminated any prohibition under
application law or the rules or regulations of any stock exchange, interdealer
quotation system or other self-regulatory organization with jurisdiction over
the Borrower or any of its securities on the Borrower's ability to issue shares
of Common Stock in excess of the Maximum Share Amount then the Borrower shall be
obligated to redeem immediately all of the then outstanding Debentures, in
accordance with this Section 1.6. An irrevocable redemption notice (the "TRADING
MARKET REDEMPTION NOTICE") shall be delivered promptly to the Holders of
Debentures at their registered address appearing on the records of the Borrower
and shall state (i) that the Maximum Share Amount has been issued upon
conversion of the Debentures, (ii) that the Borrower is obligated to redeem all
of the outstanding Debentures, and (iii) the date of redemption, which shall be
a date within five (5) business days of the earlier of (a) the date of the
Trading Market Redemption Notice or (b) the date on which the Holders of the
Debentures notify the Borrower of the occurrence of a Trading Market Redemption
Event. On the date of redemption, the Borrower shall make payment of the Default
Amount (as defined in Article III) in cash.

         1.7      STATUS AS SHAREHOLDER. Upon submission of a Notice of
Conversion by a Holder, (i) the shares covered thereby (other than the shares,
if any, which cannot be issued because their issuance would exceed such Holder's
allocated portion of the Reserved Amount or Maximum Share Amount) shall be
deemed converted into shares of Common Stock and (ii) the Holder's rights as a
Holder of such converted portion of this Debenture shall cease and terminate,
excepting only the right to receive certificates for such shares of Common Stock
and to any remedies provided herein or otherwise available at law or in equity
to such Holder because of a failure by the Borrower to comply with the terms of
this Debenture. Notwithstanding the foregoing, if a Holder has not received
certificates for all shares of Common Stock prior to the tenth (10th) business
day after the expiration of the Deadline with respect to a conversion of any
portion of this Debenture for any reason, then (unless the Holder otherwise
elects to retain its status as a holder of Common Stock by so notifying the
Borrower) the Holder shall regain the rights of a Holder of this Debenture with
respect to such unconverted portions of this Debenture and the Borrower shall,
as soon as practicable, return such unconverted Debenture to the Holder or, if
the Debenture has not been surrendered, adjust its records to reflect that such
portion of this Debenture has not been converted. In all cases, the Holder shall
retain all of its rights and remedies (including, without limitation, the right
to receive Conversion Default Payments pursuant to Section 1.3 to the extent
required thereby for such Conversion Default and any subsequent Conversion
Default) for the Borrower's failure to convert this Debenture.



                                       16
<PAGE>



                          ARTICLE II. CERTAIN COVENANTS

         2.1      DISTRIBUTIONS ON CAPITAL STOCK. So long as the Borrower shall
have any obligation under this Debenture, the Borrower shall not, without the
Holder's written consent, (a) pay, declare or set apart for such payment, any
dividend or other distribution (whether in cash, property or other securities)
on shares of capital stock other than dividends on shares of Common Stock solely
in the form of additional shares of Common Stock or (b) directly or indirectly
or through any subsidiary make any other payment or distribution in respect of
its capital stock; PROVIDED, HOWEVER, that the Borrower shall not be prohibited
from distributing or issuing shares (or rights to acquire shares) of the
subsidiary listed on Schedule 2.1 hereto so long as any such distribution or
issuance would otherwise be subject to the provisions of Sections 1.5(c) and (d)
hereof.

         2.2      RESTRICTION ON STOCK REPURCHASES. So long as the Borrower
shall have any obligation under this Debenture, the Borrower shall not, without
the Holder's written consent, redeem, repurchase or otherwise acquire (whether
for cash or in exchange for property or other securities or otherwise) in any
one transaction or series of related transactions any shares of capital stock of
the Borrower or any warrants, rights or options to purchase or acquire any such
shares, except for any such repurchases made by the Borrower in connection with
the termination of employment of any of its employees, PROVIDED that such
repurchases are (i) made at no greater than the Market Price of such shares of
capital stock and (ii) approved by a majority of the Borrower's disinterested
directors.

         2.3      BORROWINGS. So long as the Borrower shall have any obligation
under this Debenture, the Borrower shall not, without the Holder's written
consent, create, incur, assume or suffer to exist any liability for borrowed
money, except (a) borrowings in existence or committed on the date hereof and of
which the Borrower has informed the Holder in writing prior to the date hereof,
(b) indebtedness to trade creditors incurred in the ordinary course of business,
(c) borrowings, the proceeds of which shall be used to repay this Debenture, (d)
asset-based borrowings involving accounts receivable or inventory financing or
leaseholds or (e) pledges by the Borrower of the capital stock of the subsidiary
listed on Schedule 2.1 hereto as collateral in connection with a BONA FIDE
lending arrangement, the proceeds of which are used by the Borrower to finance
the operations of such subsidiary.

         2.4     ADVANCES AND LOANS. So long as the Borrower shall have any
obligation under this Debenture, the Borrower shall not, without the Holder's
written consent, lend money, give credit or make advances to any person, firm,
joint venture or corporation, including, without limitation, officers,
directors, employees, subsidiaries and affiliates of the Borrower, except loans,
credits or advances (a) in existence or committed on the date hereof and which
the Borrower has informed the Holder in writing prior to the date hereof, (b)
made in the ordinary course of business, as determined by a majority of the
Borrower's disinterested directors or (c) relating to (i) the recruitment or
retention of employees or (ii) transactions with joint venture partners or
subsidiaries,



                                       17
<PAGE>



provided that such loans, credits or advances referred to in (i) and (ii) are
approved by a majority of the Borrower's disinterested directors.

         2.5      CONTINGENT LIABILITIES. So long as the Borrower shall have any
obligation under this Debenture, the Corporation shall not without the Holder's
written consent, assume, guarantee, endorse, contingently agree to purchase or
otherwise become liable upon the obligation of any person, firm, partnership,
joint venture or corporation, except by the endorsement of negotiable
instruments for deposit or collection and except assumptions, guarantees,
endorsements and contingencies (a) in existence or committed on the date hereof
and which the Borrower has informed the Holder in writing prior to the date
hereof, (b) made in the ordinary course of business, as determined by a majority
of the Borrower's disinterested directors or (c) relating to (i) the recruitment
or retention of employees or (ii) transactions with joint venture partners or
subsidiaries, provided that such assumptions, guarantees, endorsements and
contingencies referred to in (i) and (ii) are approved by a majority of the
Borrower's disinterested directors.


                         ARTICLE III. EVENTS OF DEFAULT

         If any of the following events of default (each, an "EVENT OF DEFAULT")
shall occur:

         3.1      FAILURE TO PAY PRINCIPAL OR INTEREST. The Borrower fails to
pay the principal hereof or interest thereon when due on this Debenture, whether
at maturity, upon mandatory prepayment pursuant to Section 1.6, upon
acceleration or otherwise;

         3.2      CONVERSION AND THE SHARES. The Borrower (a) fails to issue
shares of Common Stock to the Holder (or announces or states in writing that it
will not honor its obligation to do so) upon exercise by the Holder of the
conversion rights of the Holder in accordance with the terms of this Debenture
(for a period of at least sixty (60) days, if such failure is solely as a result
of the circumstances governed by Section 1.3 and the Borrower is using its best
efforts to authorize a sufficient number of shares of Common Stock as soon as
practicable), (b) fails to transfer or cause its transfer agent to transfer
(electronically or in certificated form) any certificate for shares of Common
Stock issued to the Holder upon conversion of this Debenture as and when
required by this Debenture or the Registration Rights Agreement, or (c) fails to
remove any restrictive legend (or to withdraw any stop transfer instructions in
respect thereof) on any certificate for any shares of Common Stock issued to the
Holder upon conversion of this Debenture as and when required by this Debenture,
the Purchase Agreement or the Registration Rights Agreement (or makes any
announcement or written statement that it does not intend to honor the
obligations described in this paragraph) and any such failure shall continue
uncured (or any announcement or written statement not to honor its obligations
shall not be rescinded in writing) for ten (10) days after the Borrower shall
have been notified thereof in writing by the Holder;

         3.3      FAILURE TO EFFECT REGISTRATION. The Borrower fails to obtain
effectiveness with the Securities and Exchange Commission prior to July 31, 2000
of the Registration Statement(s) (as defined in the Registration Rights
Agreement) required to be filed pursuant to Section 2(a) of the



                                       18
<PAGE>



Registration Rights Agreement, or fails to obtain the effectiveness of any
additional Registration Statement (required to be filed pursuant to Section 3(b)
of the Registration Rights Agreement) within 60 days after the Registration
Trigger Date (as defined in the Registration Rights Agreement), or any such
Registration Statement, after its initial effectiveness and during the
Registration Period (as defined in the Registration Rights Agreement), lapses in
effect or sales of all of the Registrable Securities (as defined in the
Registration Rights Agreement) cannot otherwise be made thereunder (whether by
reason of the Borrower's failure to amend or supplement the prospectus included
therein in accordance with the Registration Rights Agreement, the Borrower's
failure to file and obtain effectiveness with the SEC of an additional
Registration Statement required pursuant to Section 3(b) of the Registration
Rights Agreement or otherwise) for more than twenty (20) consecutive days or
sixty (60) days in any twelve month period after such Registration Statement
becomes effective;

         3.4     BREACH OF COVENANTS. The Borrower breaches any material
covenant or other material term or condition contained in Article II hereof or
in Sections 1.3, 1.5 or 1.6 of this Debenture, or Sections 4(c), 4(d), 4(e),
4(h), 4(i), 4(j) or 5 of the Purchase Agreement and such breach continues for a
period of ten (10) business days after written notice thereof to the Borrower
from the Holder;

         3.5      BREACH OF REPRESENTATIONS AND WARRANTIES. Any representation
or warranty of the Borrower made herein or in any agreement, statement or
certificate given in writing pursuant hereto (including, without limitation,
pursuant to the Purchase Agreement and the Registration Rights Agreement), shall
be false or misleading in any material respect when made and the breach of which
has a material adverse effect on the rights of the Holder with respect to this
Debenture, the Purchase Agreement or the Registration Rights Agreement;

         3.6      RECEIVER OR TRUSTEE. The Borrower or any subsidiary of the
Borrower shall make an assignment for the benefit of creditors, or apply for or
consent to the appointment of a receiver or trustee for it or for a substantial
part of its property or business, or such a receiver or trustee shall otherwise
be appointed;

         3.7      JUDGMENTS. Any money judgment, writ or similar process shall
be entered or filed by a court against the Borrower or any subsidiary of the
Borrower or any of its property or other assets for more than $1,000,000, and
shall remain unvacated, unbonded or unstayed for a period of twenty (20) days
unless otherwise consented to by the Holder, which consent will not be
unreasonably withheld;

         3.8      BANKRUPTCY. Bankruptcy, insolvency, reorganization or
liquidation proceedings or other proceedings for relief under any bankruptcy law
or any law for the relief of debtors shall be instituted by or against the
Borrower or any "significant subsidiary" (as defined in Rule 1-02(w) of
Regulation S-X promulgated under the 1933 Act) of the Borrower;

         3.9      DELISTING OF COMMON STOCK. The Borrower shall fail to maintain
the listing of the Common Stock on at least one of the NNM, the Nasdaq SmallCap,
the NYSE, or the AMEX; or

\


                                       19
<PAGE>



         3.10     DEFAULT UNDER OTHER DEBENTURES. An Event of Default has
occurred and is continuing under any of the other Debentures issued pursuant to
the Purchase Agreement.

then, upon the occurrence and during the continuation of any Event of Default
specified in Section 3.1, 3.2, 3.3, 3.4, 3.5, 3.7, 3.9, or 3.10, at the option
of the Holders of a majority of the aggregate principal amount of the
outstanding Debentures issued pursuant to the Purchase Agreement exercisable
through the delivery of written notice to the Borrower by such Holders (the
"DEFAULT NOTICE"), and upon the occurrence of an Event of Default specified in
Section 3.6 or 3.8, the Debentures shall become immediately due and payable and
the Borrower shall pay to the Holder, in full satisfaction of its obligations
hereunder, an amount equal to the greater of (i) 115% TIMES the SUM of (w) the
then outstanding principal amount of this Debenture, PLUS (x) all accrued and
unpaid interest thereon for the period beginning on the Issue Date and ending on
the date of payment of the Default Amount (the "MANDATORY PREPAYMENT DATE"),
plus (y) Default Interest, if any, on the amounts referred to in clauses (w)
and/or (x), PLUS (z) any amounts owed to the Holder pursuant to Sections 1.3 and
1.4(e) hereof or pursuant to Section 2(b) of the Registration Rights Agreement
(the then outstanding principal amount of this Debenture to the date of payment
PLUS the amounts referred to in clauses (x), (y) and (z) shall collectively be
known as the "DEFAULT SUM"), or (ii) the "parity value" of the Default Sum to be
prepaid, where parity value means (a) the highest number of shares of Common
Stock issuable upon conversion of such Default Sum in accordance with Article I
(without giving any effect to any limitation on conversion of the Debenture
contained herein,) MULTIPLIED BY (b) the highest Closing Price (as defined
below) for the Common Stock during the period beginning on the date of first
occurrence of the Event of Default and ending one day prior to the Mandatory
Prepayment Date (the greater of such amounts being referred to herein as the
"DEFAULT AMOUNT"). The Default Amount, together with all other amounts payable
hereunder, shall immediately become due and payable, all without demand,
presentment or notice, all of which hereby are expressly waived, together with
all costs, including, without limitation, legal fees and expenses, of
collection, and the Holder shall be entitled to exercise all other rights and
remedies available at law or in equity. "CLOSING PRICE," as of any date, means
the last sale price of the Common Stock on the NNM as reported by Bloomberg or,
if the NNM is not the principal trading market for such security, the last sale
price of such security on the principal securities exchange or trading market
where such security is listed or traded as reported by Bloomberg, or if the
foregoing do not apply, the last sale price of such security in the
over-the-counter market on the electronic bulletin board for such security as
reported by Bloomberg, or, if no last sale price of such security is available
in the over-the-counter market on the electronic bulletin board for such
security or in any of the foregoing manners, the average of the bid prices of
any market makers for such security that are listed in the "pink sheets" by the
National Quotation Bureau, Inc. If the Closing Price cannot be calculated for
such security on such date in the manner provided above, the Closing Price shall
be the fair market value as mutually determined by the Borrower and the Holder.

         If the Borrower fails to pay the Default Amount within five (5)
business days of written notice that such amount is due and payable, then the
Holder shall have the right at any time, so long as the Borrower remains in
default (and so long and to the extent that there are sufficient authorized
shares), to require the Borrower, upon written notice, to immediately issue, in
lieu of the



                                       20
<PAGE>



Default Amount, the number of shares of Common Stock of the Borrower equal to
the Default Amount divided by the Conversion Price then in effect.


                         ARTICLE IV. OPTIONAL REDEMPTION

         So long as for at all times during the period beginning thirty (30)
Trading Days prior to the date of the Optional Redemption Notice (as defined
below) and ending on the Optional Redemption Date (as defined below) (i) all of
the shares of Common Stock issuable upon conversion of the Debentures are then
(x) authorized and reserved for issuance, (y) registered for resale under the
1933 Act by the Holders of the Debentures and sales of such shares may be made
thereunder (or such shares may otherwise be resold publicly without restriction)
and (z) eligible to be traded on the NNM, the Nasdaq SmallCap, the NYSE or the
AMEX and (ii) no Event of Default or Trading Market Redemption Event shall have
occurred and be continuing, then the Borrower shall have the right on or prior
to 5:00 p.m., New York City time, on each of the one-year anniversary of the
Issue Date and the two-year anniversary of the Issue Date, to deliver written
notice to the holders of the Debentures (which notice may only be sent to the
holders of the Debentures (A) if, on the one-year anniversary of the Issue Date,
the First Adjusted Conversion Price is less than the Initial Conversion Price or
if, on the two-year anniversary of the Issue Date, the Second Adjusted
Conversion Price is less than the Conversion Price then in effect and (B) if, in
each such case, the Conversion Price would otherwise be adjusted pursuant to
Section 1.2(b) or (c) hereof, as applicable) of its intention to redeem all of
the outstanding Debentures in accordance with this Article IV. Any notice (the
"OPTIONAL REDEMPTION NOTICE") of redemption hereunder (an "OPTIONAL REDEMPTION")
shall be delivered to the holders of the Debentures at their registered
addresses appearing on the books and records of the Borrower and shall state (1)
that the Borrower is exercising its right to redeem all of the outstanding
Debentures issued and (2) the date of redemption (the "OPTIONAL REDEMPTION
DATE"), which date shall be twenty (20) Trading Days after the date of delivery
of the Optional Redemption Notice. On the Optional Redemption Date, the Borrower
shall make payment of the Optional Redemption Amount (as defined below) to or
upon the order of the holders as specified by the holders in writing to the
Borrower at least one (1) business day prior to the Optional Redemption Date. If
the Borrower exercises its right to redeem the Debentures, the Borrower shall
make payment to the holders of an amount in cash (the "OPTIONAL REDEMPTION
AMOUNT") equal to (a) the then outstanding principal amount of the Debentures,
PLUS (b) all accrued and unpaid interest thereon for the period beginning on the
Issue Date and ending on the Optional Redemption Date, PLUS (c) Default
Interest, if any, on the amounts referred to in clauses (a) and/or (b), PLUS (d)
all Conversion Default Payments, Delivery Default Payments and any other amounts
owed to such holder pursuant to Section 2(c) of the Registration Rights
Agreement. Notwithstanding notice of an Optional Redemption, the holders shall
at all times prior to the Optional Redemption Date maintain the right to convert
all or any portion of the Debentures at the Conversion Price in effect prior to
the delivery of such Optional Redemption Notice (as the same may be adjusted
pursuant to Section 1.5) in accordance with Article I and any portion of the
Debentures so converted after receipt of an Optional Redemption Notice and prior
to the Optional Redemption Date set forth in such notice and payment of the
aggregate Optional Redemption Amount shall be deducted from the Debentures which
are otherwise subject to redemption pursuant to such notice. If the Borrower



                                       21
<PAGE>



delivers an Optional Redemption Notice and fails to pay the Optional Redemption
Amount due to the holders of the Debentures within two (2) business days
following the Optional Redemption Date, the Borrower shall forever forfeit its
right to redeem the Debentures pursuant to this Article IV.


                            ARTICLE V. MISCELLANEOUS

         5.1      FAILURE OR INDULGENCE NOT WAIVER. No failure or delay on the
part of the Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power, right or privilege preclude other or further exercise thereof or
of any other right, power or privileges. All rights and remedies existing
hereunder are cumulative to, and not exclusive of, any rights or remedies
otherwise available.

         5.2      NOTICES. Any notice herein required or permitted to be given
shall be in writing and may be personally served or delivered by courier or sent
by United States mail and shall be deemed to have been given upon receipt if
personally served (which shall include telephone line facsimile transmission) or
sent by courier or three (3) days after being deposited in the United States
mail, certified, with postage pre-paid and properly addressed, if sent by mail.
For the purposes hereof, the address of the Holder shall be as shown on the
records of the Borrower; and the address of the Borrower shall be 1311
Mamaroneck Avenue, White Plains, New York 10605, facsimile number (914)
682-4440. Both the Holder and the Borrower may change the address for service by
service of written notice to the other as herein provided.

         5.3      AMENDMENTS. Except as otherwise expressly provided herein,
this Debenture and any provision hereof may only be amended by an instrument in
writing signed by the Borrower and the Holder. The term "Debenture" and all
reference thereto, as used throughout this instrument, shall mean this
instrument (and the other Debentures issued pursuant to the Purchase Agreement)
as originally executed, or if later amended or supplemented, then as so amended
or supplemented.

         5.4      ASSIGNABILITY. This Debenture shall be binding upon the
Borrower and its successors and assigns, and shall inure to be the benefit of
the Holder and its successors and assigns.

         5.5      COST OF COLLECTION. If default is made in the payment of this
Debenture, the Borrower shall pay the Holder hereof costs of collection,
including reasonable attorneys' fees.

         5.6      GOVERNING LAW. This Debenture shall be governed by the
internal laws of the State of Delaware, without regard to the principles of
conflict of laws.

         5.7      CERTAIN AMOUNTS. Whenever pursuant to this Debenture the
Borrower is required to pay an amount in excess of the outstanding principal
amount (or the portion thereof required to be paid at that time) plus accrued
and unpaid interest plus Default Interest on such interest, the Borrower and the
Holder agree that the actual damages to the Holder from the receipt of cash
payment on this Debenture may be difficult to determine and the amount to be so
paid by the Borrower represents stipulated damages and not a penalty and is
intended to compensate the



                                       22
<PAGE>



Holder in part for loss of the opportunity to convert this Debenture and to earn
a return from the sale of shares of Common Stock acquired upon conversion of
this Debenture at a price in excess of the price paid for such shares pursuant
to this Debenture. The Borrower and the Holder hereby agree that such amount of
stipulated damages is not plainly disproportionate to the possible loss to the
Holder from the receipt of a cash payment without the opportunity to convert
this Debenture into shares of Common Stock.

         5.8      ALLOCATIONS OF MAXIMUM SHARE AMOUNT AND RESERVED AMOUNT. The
Maximum Share Amount and Reserved Amount shall be allocated pro rata among the
holders of Debentures based on the principal amount of such Debentures issued to
each Holder. Each increase to the Maximum Share Amount and Reserved Amount shall
be allocated pro rata among the holders of Debentures based on the principal
amount of such Debentures held by each Holder at the time of the increase in the
Maximum Share Amount or Reserved Amount. In the event a Holder shall sell or
otherwise transfer any of such Holder's Debentures, each transferee shall be
allocated a pro rata portion of such transferor's Maximum Share Amount and
Reserved Amount. Any portion of the Maximum Share Amount or Reserved Amount
which remains allocated to any person or entity which does not hold any
Debentures shall be allocated to the remaining Holders of Debentures, pro rata
based on the principal amount of such Debentures then held by such Holders.

         5.9      DAMAGES SHARES. The shares of Common Stock that may be
issuable to the Holder pursuant to Sections 1.3 and 1.4(e) hereof and pursuant
to Section 2(c) of the Registration Rights Agreement ("DAMAGES SHARES") shall be
treated as Common Stock issuable upon conversion of this Debenture for all
purposes hereof and shall be subject to all of the limitations and afforded all
of the rights of the other shares of Common Stock issuable hereunder, including
without limitation, the right to be included in the Registration Statement filed
pursuant to the Registration Rights Agreement. For purposes of calculating
interest payable on the outstanding principal amount hereof, except as otherwise
provided herein, amounts convertible into Damages Shares ("DAMAGES AMOUNTS")
shall not bear interest but must be converted prior to the conversion of any
outstanding principal amount hereof, until the outstanding Damages Amounts is
zero.

         5.10     DENOMINATIONS. At the request of the Holder, upon surrender of
this Debenture, the Borrower shall promptly issue new Debentures in the
aggregate outstanding principal amount hereof, in the form hereof, in such
denominations as the Holder shall request.

         5.11     PURCHASE AGREEMENT. By its acceptance of this Debenture, each
Holder agrees to be bound by the applicable terms of the Purchase Agreement.

         5.12     NOTICE OF CORPORATE EVENTS. Except as otherwise provided in
this Debenture, the Holder of this Debenture shall have no rights as a Holder of
Common Stock unless and only to the extent that it converts this Debenture into
Common Stock. The Borrower shall provide the Holder with prior notification of
any meeting of the Borrower's shareholders (and copies of proxy materials and
other information sent to shareholders). In the event of any taking by the
Borrower of a record of its shareholders for the purpose of determining
shareholders who are entitled to receive payment of any dividend or other
distribution, any right to subscribe for, purchase or otherwise



                                       23
<PAGE>



acquire (including by way of merger, consolidation, reclassification or
recapitalization) any share of any class or any other securities or property, or
to receive any other right, or for the purpose of determining shareholders who
are entitled to vote in connection with any proposed sale, lease or conveyance
of all or substantially all of the assets of the Borrower or any proposed
liquidation, dissolution or winding up of the Borrower, the Borrower shall mail
a notice to the Holder, at least twenty (20) days prior to the record date
specified therein (or thirty (30) days prior to the consummation of the
transaction or event, whichever is earlier), of the date on which any such
record is to be taken for the purpose of such dividend, distribution, right or
other event, and a brief statement regarding the amount and character of such
dividend, distribution, right or other event to the extent known at such time.
The Borrower shall make a public announcement of any event requiring
notification to the Holder hereunder substantially simultaneously with the
notification to the Holder in accordance with the terms of this Section 5.12.

         5.13     REMEDIES. The Borrower acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Holder, by vitiating
the intent and purpose of the transaction contemplated hereby. Accordingly, the
Borrower acknowledges that the remedy at law for a breach of its obligations
under this Debenture will be inadequate and agrees, in the event of a breach or
threatened breach by the Borrower of the provisions of this Debenture, that the
Holder shall be entitled, in addition to all other available remedies at law or
in equity, to an injunction or injunctions restraining, preventing or curing any
breach of this Debenture and to enforce specifically the terms and provisions
thereof, without the necessity of showing economic loss and without any bond or
other security being required.







                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]



                                       24
<PAGE>



         IN WITNESS WHEREOF, Borrower has caused this Debenture to be signed in
its name by its duly authorized officer this day of March 10, 2000.


                                    LEARN2.COM, INC.



                                    By:
                                           -------------------------------------
                                           Stephen P. Gott
                                           President and Chief Executive Officer



                                       25
<PAGE>



                                                                       EXHIBIT A

                              NOTICE OF CONVERSION

                    (To be Executed by the Registered Holder
                       in order to Convert the Debentures)


         The undersigned hereby irrevocably elects to convert $__________
principal amount of the Debenture (defined below) into shares of common stock,
par value $0.01 per share ("Common Stock"), of Learn2.com, Inc., a Delaware
corporation (the "BORROWER") according to the conditions of the convertible
debentures of the Borrower dated as of March 10, 2000 (the "DEBENTURES"), as of
the date written below. If securities 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. No fee will
be charged to the Holder for any conversion, except for transfer taxes, if any.

         The Borrower shall electronically transmit the Common Stock issuable
pursuant to this Notice of Conversion to the account of the undersigned or its
nominee with DTC through its Deposit Withdrawal Agent Commission system ("DWAC
TRANSFER").

         Name of DTC Prime Broker:______________________________
         Account Number:________________________________________

/_/      In lieu of receiving shares of Common Stock issuable pursuant to this
         Notice of Conversion by way of a DWAC Transfer, the undersigned hereby
         requests that the Borrower issue a certificate or certificates for the
         number of shares of Common Stock set forth above (which numbers are
         based on the Holder's calculation attached hereto) in the name(s)
         specified immediately below or, if additional space is necessary, on an
         attachment hereto:

         Name:__________________________________________________

         Address:_______________________________________________
                 _______________________________________________

The undersigned represents and warrants that all offers and sales by the
undersigned of the securities issuable to the undersigned upon conversion of the
Debentures shall be made pursuant to registration of the securities under the
Securities Act of 1933, as amended (the "ACT"), or pursuant to an exemption from
registration under the Act.

                  Date of Conversion:_______________________________
                  Applicable Conversion Price:______________________
                  Number of Shares of Common
                  Stock to be Issued Pursuant to (i)
                  Conversion of the Debentures:_____________________



                                       A-1

<PAGE>



               (ii) Conversion of Conversion Default Payments, Delivery Default
               Payments and/or payments pursuant to Section 2(c) of the
               Registration Rights Agreement:  _________________________________
               Signature:_______________________________________________________
               Name:____________________________________________________________
               Address:_________________________________________________________

               Subject to Section 1.4(b) of the Debenture(s), the Borrower is
not required to issue shares of Common Stock until the original Debenture(s) (or
evidence of loss, theft or destruction thereof) to be converted are received by
the Borrower or its Transfer Agent. The Borrower shall issue and deliver shares
of Common Stock to an overnight courier not later than two business days
following receipt of the original Debenture(s) to be converted, and shall make
payments pursuant to the Debentures for the number of business days such
issuance and delivery is late.



                                       A-2

<PAGE>



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