THIS
        NOTE
        HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES
        LAWS
        OF ANY STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT
        TO AN
        EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES
        LAWS OR AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH
        ACT AND
        SUCH LAWS. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER FEDERAL
        OR STATE REGULATORY AUTHORITY HAS PASSED ON OR ENDORSED THE MERITS OF THIS
        NOTE.


      


      PROMISSORY
        NOTE

       

      U.S.
        $30,000.00

      Payee:
        Richard
        Kraniak
        (Fifth
        3rd Bank Account) Original Issue Date: October 27, 2006

      101
        West Long Lake Road

      Bloomfield
        Hills, MI 48304


      


      FOR
        VALUE
        RECEIVED, POWER 3 MEDICAL PRODUCTS, INC., a New York corporation (the “Maker”),
        promises to pay to the order of Rick
        Kraniak
        , (the
“Payee”), pursuant to the terms and conditions contained in this promissory note
        (this “Note”) the principal sum of Thirty
        thousand Dollars ($30,000.00),
        together with interest on the unpaid principal balance from the date hereof
        until paid in full on October 27, 2007 or converted at the Payee’s option into
        restricted common stock of Power3 Medical Products, Inc. at the price of
        $0.06
        per common share on the terms provided herein.

      


      1. Terms
        and Payment.
        Principal
        and interest of this Note shall be payable as follows:

      


      
        	
              	(i)	
                The
                  entire unpaid principal balance of this Note shall be payable,
                  in cash,
                  within one year from the date of the original issue date and is
                  due on
                  October 27, 2007 unless the note is converted into restricted common
                  stock
                  of Power3 Medical Products, Inc.

              


      

      


      
        	
              	(ii)	
                Interest,
                  computed on the unpaid principal balance of this Note, shall be
                  due and
                  payable at Payee’s option, as follows:


              


      

      


      (A) the
        accrued and unpaid interest shall be paid, in cash, concurrently upon the
        Payment Date; or 

      


      
        	
              	(B)	
                the
                  accrued and unpaid interest payable on this Note shall be considered
                  paid,
                  in full, upon Maker’s issuance and delivery of restricted shares of
                  Maker’s common stock. 

              


      

      


      
        
          
            	
                  	(iii)	
                    Warrants,
                      as further consideration of this note, the Payee is entitled
                      to subscribe
                      for, and purchase up to
                      Five hundred thousand (500,000)
                      shares of the Company’s common stock, at any time or from time to time
                      during the period commencing on the date hereof (the “Initial Exercise
                      Date”) and terminating at 5:00 p.m., Houston, Texas local time,
                      on the
                      third anniversary of the Initial Exercise Date (the “Exercise Period”).
                      This Warrant is exercisable at an exercise price per share
                      equal to $0.08
                      per share (the “Exercise Price”).


                  


          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      If
        the
        Payment of interest or principal is due on a day that is not a Business Day
        (as
        hereinafter defined), such payment shall be made on the first Business Day
        following such payment date. For
        purposes of this Note, “Business Day” means any day other than Saturday, Sunday
        or any other day on which national banking associations in the State of New
        York
        generally are closed for commercial banking business.

      


      2. Interest
        Rate.
        During
        the period ending on the Payment Date (the “Payment Period”), the unpaid
        principal balance of this Note shall bear simple interest at a per annum
        rate
        equal to seven percent (7%) for such period determined in accordance with
        this
        Section 2. Notwithstanding the foregoing, upon an Event of Default (as
        hereinafter defined) with respect to the Payment and until such Event of
        Default
        shall have been cured, such
        Payment shall bear interest at a
        rate of
        ten percent (10%) per annum.
        Interest
        shall be payable as provided in Section 1 above.

      


      3.
        Event
        of Default.
        It is
        expressly provided that upon failure in the punctual payment of the principal
        due hereunder, as the same shall become due and payable, and the passage
        of
        thirty (30) days following when such payment was due and payable, during
        which
        period the Maker may make such payment(s) as are due and payable and prevent
        a
        default of this Note, an “Event of Default” will have occurred. Upon an Event of
        Default and until such Event of Default shall have been cured, the holder
        of
        this Note may, at its option, without further notice or demand, (i) declare
        the
        outstanding principal balance of this Note, and accrued but unpaid interest
        payable on this Note in cash at the rate provided in Section 2 hereof, at
        once due and payable, (ii) pursue any and all rights, remedies and recourses
        available to the holder hereof, including but not limited to any such rights,
        remedies or recourses at law or in equity, or (iii) pursue any combination
        of
        the foregoing; and in the event default is made in the prompt payment of
        this
        Note when due or declared due, and the same is placed in the hands of an
        attorney for collection, or suit is brought on the same, or the same is
        collected through probate, bankruptcy or other judicial proceedings, then
        the
        Maker agrees and promises to pay all costs of collection, including reasonable
        attorney’s fees. 

      


      4. Right
        of Prepayment.
        The
        Maker
        shall have the right to prepay all or any part of the unpaid principal or
        interest hereon within ten (10) days written notice without premium or penalty
        and at said time, the Payee shall have the right to convert the note during
        this
        ten (10) day notification period. Any and all prepayments with respect to
        this
        Note shall be applied first to payment of accrued interest as of the date
        of
        such prepayment and the balance, if any, shall be applied in reduction of
        the
        unpaid principal. 

      


      5. No
        Right of Setoff.
        THE
        PAYEE
        ACKNOWLEDGES AND AGREES THAT THE MAKER HAS NO RIGHTS OF SETOFF AGAINST THE
        PAYMENT AND THEREFORE SHALL NOT WITHHOLD OR REDUCE THE PAYMENT ON THIS NOTE
        BY
        ANY AMOUNTS DUE FROM THE PAYEE TO THE MAKER.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      6. Registration
        Rights. 

       

      
        	 	
                (i)

              	
                If
                  the Company shall at any time seek to register or qualify any of
                  its
                  common stock or the securities holdings of any of its controlling
                  shareholders, on each such occasion it shall, without cost or expense,
                  include all of the Payee’s Shares that have been converted per the terms
                  of this agreement, and all shares underlying the warrants issued
                  in this
                  transaction, in such registration or qualification. The Company
                  shall keep
                  the registration effective until such time as the Purchaser has
                  sold its
                  Shares or the Shares are eligible to be transferred without restriction
                  pursuant to the provisions of Rule 144(k) which was promulgated
                  by the
                  Securities and Exchange Commission pursuant to §4(1) of the Securities Act
                  of 1933, as amended. The Purchaser agrees to provide an opinion
                  of counsel
                  with respect to any sales of the Shares by the Purchaser if such
                  sale is
                  permissible under Rule 144(k).

              


      

      


      
        	 	
                (ii)

              	
                All
                  expenses in connection with preparing and filing any registration
                  statement under Paragraph “A” of this Article “6” of this Agreement shall
                  be borne in full by the Company; provided, however, that the Purchaser
                  shall pay any and all underwriting commissions and expenses and
                  the fees
                  and expenses of any legal counsel selected by the Purchaser to
                  represent
                  it with respect to the sale of the
                  Securities.

              


      

      


      7. No
        Usury Intended; Usury Savings Clause.
        In
        no
        event shall interest contracted for, charged or received hereunder, plus
        any
        other charges in connection herewith which constitute interest, exceed the
        maximum interest permitted by applicable law. The amounts of such interest
        or
        other charges previously paid to the holder of the Note in excess of the
        amounts
        permitted by applicable law shall be applied by the holder of the Note to
        reduce
        the principal of the indebtedness evidenced by the Note, or, at the option
        of
        the holder of the Note, be refunded. To the extent permitted by applicable
        law,
        determination of the legal maximum amount of interest shall at all times
        be made
        by amortizing, prorating, allocating and spreading in equal parts during
        the
        period of the full stated term of the loan and indebtedness, all interest
        at any
        time contracted for, charged or received from the Maker hereof in connection
        with the loan and indebtedness evidenced hereby, so that the actual rate
        of
        interest on account of such indebtedness is uniform throughout the term
        hereof. 

       

      8. Waivers.
        The
        Maker hereby waives presentment, protest, demand for payment, notice of dishonor
        and all other notices of any kind. No waiver of any default shall operate
        as a
        waiver of any other default or of the same default on any future occasion,
        and
        no action to enforce payment hereunder nor any indulgences or other arrangements
        granted to the Maker, including any extension of time for payment due thereon,
        shall release, waive or otherwise affect any right of the owner or holder
        hereof.

      


      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      9. Governing
        Law.
        This
        Note
        will be governed by the laws of the State of Texas without giving effect
        to any
        choice or conflict of law principles of any jurisdiction. 

      


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        rest
        of this page is intentionally left blank.]


      
        
          
          

        

        
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      IN
        WITNESS WHEREOF, the Maker has caused this Note to be executed as of the
        day and
        year first above written.

       

      
        	 	 	 
	 	
                POWER3
                  MEDICAL PRODUCTS, INC.

              
	 
 	 
 	 
 
	
              	By:  	/s/ Steven B. Rash 
	 	
                

                Name:
                  Steven B. Rash

                Title:
                  Chairman and CEO

              
	 	 


      

      

        	 	 	 
	 	
                RICHARD
                  KRANIAK

              
	 
 	 
 	 
 
	 	By:  	/s/ Richard Kraniak 
	 	
                
Name:
                Richard
                Kraniak (Fifth
                3rd Bank Account)
	 	 
	 	Title:
                
	 	
                 

                  

                

              


      

       

      
        
          
          

        

        
          5