| 5% CONVERTIBLE SUBORDINATED PROMISSORY NOTE |
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| No. [   ] | June 4, 2010 |
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| U.S. $ _____________     |         |

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| Securities                          | (1) Series C Preferred Voting Stock (the “Series C Preferred”), initially convertible into an aggregate of up to 4,000,000 shares of the Company’s common stock (“Common Stock”) and (2) a warrant (the “B Warrant”) to purchase an aggregate of up to 4,000,000 shares of Common Stock. |
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| Targeted Closing                    | Definitive agreements and closing by July 7, 2010 (the “Closing Date”) subject to satisfactory completion of due diligence, receipt of required internal approvals, no material adverse change, execution of definitive documentation and compliance with applicable regulatory approvals.                             |
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| Investors                           | Holders of the Company’s 5% Convertible Subordinated Promissory Notes, dated June 4, 2010 (the “Notes”) upon optional exercise of such holders’ Note conversion rights.                                                                                                                                    |
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| Terms of the Series C Preferred:    |                                                                                                                                                                                                                                                                                                                               |
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| Dividends                           | None.                                                                                                                                                                                                                                                                                                                              |
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| Liquidation                         | In the event of any liquidation of the Company, after payment of the liquidation preference to the holders of the Company’s Series A Preferred Stock, the holders of Series C Preferred Stock shall be entitled to receive a per share liquidation preference equal to the current conversion price.                         |
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| Optional Conversion                 | The Series C Preferred will be convertible into Common Stock, at the then applicable conversion rate, at any time at the option of the holder.  The Conversion Price initially shall be $0.50 and shall be subject to adjustment for stock splits, stock dividends and the like.                                         |
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| Adjustments to the Conversion Price | “Full ratchet” based price protection on issuances of equity securities thru March 31, 2011 (the “Outside Date”) for consideration less than the then effective Conversion Price, subject to standard exceptions.                                                                                          |
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| Voting Rights                       | Holders of Preferred Stock shall have the right to vote with the Common Stock as a single class on an ‘as converted’ basis, minus one (1) vote.                                                                                                                                                                        |
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| Covenants                           | Customary affirmative and negative covenants, in a manner which does not violate the terms of the Series A Preferred Shares and the St. Cloud senior indebtedness.                                                                                                                                                                 |

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| Terms of the Warrants: |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
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| Warrants               | The Warrants will have an exercise price of $.50 per share (subject to adjustments for stock splits, stock dividends and the like).  One third of the Warrants will vest immediately, one third will vest one year from issuance and one third will vest two years from issuance.  Each tranche of the Warrants will be exercisable during the five year period commencing the date of vesting.  The Warrants will contain a customary “cashless exercise” provision.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
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| Anti-dilution          | “Full ratchet” price protection on issuances less than the then current exercise price through the Outside Date, subject to standard exceptions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
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| Other Conditions:      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
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| Board of Directors     | Frank Plimpton (the “Lead Investor”) shall be appointed to the Board of Directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
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| Permitted Financings   | Subject to anti-dilution rights set forth in the Preferred Stock and Warrants, any debt and/or equity raise up $3 million.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
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| Registration Rights    | The Company shall file with the SEC a Registration Statement on Form S-1 (or any other applicable form) within 90 days following the Closing Date covering the re-sale of the Common Stock underlying the Preferred Stock and the Warrants.The Company will use commercially reasonable efforts to cause such Registration Statement to go effective within 150 days following the Closing Date (or, if the Registration Statement is not reviewed by the SEC, then the Company shall cause the Registration Statement to be declared effective within 5 business days of notification from the SEC that there will not be a review).  The Company shall also maintain the effectiveness of such Registration Statement until all of the securities covered by the Registration Statement may be sold by the purchasers under Rule 144 without any restriction (including volume restrictions).The purchasers’ registration rights shall be subject to any limitations under Rule 415 of the Securities Act of 1933, as amended, and the registration rights of the other holders of the Company’s securities, in each case as may be negotiated in good faith and as a condition to closing. |
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| Expenses               | Each party shall pay its own fees and expenses with respect to the Series C Preferred financing, except that in the event of a closing the Company will pay the reasonable legal fees and expenses incurred by counsel to converting Noteholders, in an amount not to exceed $25,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

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| Participation Period | For a period commencing from the conversion of the Notes until the Outside Date (the “Participation Period”), the Company agrees, except with respect to Permitted Financings, to provide the Lead Investor a right of first refusal on customary terms (“ROFR”) to match any capital raising transaction, sale or combination of the Company (a “Transaction”) proposed by or that the Company desires to effect with a bona fide third party.  Notwithstanding the foregoing, if prior to the expiration of the Participation Period, the Company’s Board of Directors determines that it must effecuate a Transaction, and that failure to take such action would violate its fiduciary duties under applicable law, the Company may proceed with such Transaction without offering the ROFR, provided, however, that in such event, as a condition to the consummation of the Transaction, the Company must require the counter-party(ies) in the Transaction to include a co-sale right (but not obligation) by all converting Noteholders to sell to said counter-party(ies) all of their shares of Series C Preferred (but not Warrants) at a converted share price as set forth below (the “Makewhole Price”), said co-sale to close (a) simultaneously with the Transaction in the case of non-Insider members who are converting Noteholders, and (b) on the date which is 6 months and 5 business days following the closing of the Note conversion in the case of converting Noteholders who are affiliates of the Company.  The Makewhole Price shall be the greater common share equivalent price in the Transaction and (a) for days 0-90 after the conversion of the Notes, $0.75, (b) for days 91-180, $1.00, (c) for days 181-270, $1.25, and (d) for days 271-360, $1.50. |
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| Documentation        | The definitive documentation will principally consist of a Securities Purchase Agreement, a Certificate of Designation of Series C Preferred Stock, a Registration Rights Agreement and a form of Warrant, each of which shall contain such additional and supplementary provisions, including, without limitation, customary representations, warranties, affirmative and negative covenants, agreements, payments and remedies, as are appropriate to preserve and protect economic benefits intended to be conveyed to the Company and to the purchasers of the Preferred Stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |