MAY NOT BE EXERCISED FOR THE SIX (6)
MONTH PERIOD (THE "NON-CONVERSION PERIOD") FOLLOWING THE DATE ON WHICH THE
BORROWER FILES A REGISTRATION STATEMENT WITH THE SECURITIES AND EXCHANGE
COMMISSION FOR THE PURPOSE OF REGISTERING SHARES TO BE OFFERED BY THE BORROWER
IN A RIGHTS OFFERING TO ITS STOCKHOLDERS, SO LONG AS AT ALL TIMES DURING THE
NON-CONVERSION PERIOD, THE BORROWER IS TAKING ALL REASONABLE STEPS TO EFFECTUATE
THE CONSUMMATION OF THE RIGHTS OFFERING.
THE NUMBER OF SHARES OF COMMON STOCK
INTO WHICH THIS NOTE MAY BE CONVERTED (THE "CONVERSION SHARES") SHALL BE
DETERMINED BY DIVIDING THE CONVERSION PRINCIPAL (AS DETERMINED ON THE DATE THAT
HOLDER EXERCISES THIS CONVERSION RIGHT) BY THE CONVERSION PRICE.
THE INITIAL
CONVERSION PRICE SHALL BE $7.50.
II.
HOLDER SHALL BE ENTITLED TO CONVERT THIS NOTE BY SURRENDERING
THIS NOTE AT THE OFFICE OF THE BORROWER AND SHALL GIVE WRITTEN NOTICE TO THE
BORROWER OF THE ELECTION TO CONVERT THIS NOTE AND SHALL STATE THEREIN THE NAME
OR NAMES IN WHICH THE CERTIFICATE OR CERTIFICATES FOR CONVERSION SHARES ARE TO
BE ISSUED.
III.
SUCH CERTIFICATE OR CERTIFICATES SHALL BEAR SUCH LEGENDS AS ARE
REQUIRED, IN THE OPINION OF COUNSEL TO THE BORROWER, BY APPLICABLE STATE AND
FEDERAL SECURITIES LAWS.
THE BORROWER SHALL, AS SOON AS PRACTICABLE THEREAFTER,
BUT NO LATER THAN SEVEN (7) BUSINESS DAYS, ISSUE AND DELIVER TO HOLDER A
CERTIFICATE OR CERTIFICATES FOR THE NUMBER OF CONVERSION SHARES TO WHICH HOLDER
SHALL BE ENTITLED AS AFORESAID.
SUCH CONVERSION SHALL BE DEEMED TO HAVE BEEN
MADE IMMEDIATELY PRIOR TO THE CLOSE OF BUSINESS ON THE DATE OF SURRENDER OF THIS
NOTE, AND THE PERSON OR PERSONS ENTITLED TO RECEIVE THE CONVERSION SHARES
ISSUABLE UPON SUCH CONVERSION SHALL BE TREATED FOR ALL PURPOSES AS THE RECORD
HOLDER OR HOLDERS OF SUCH CONVERSION SHARES AS OF SUCH DATE.
IV.
NO FRACTIONAL SHARES OF COMMON STOCK SHALL BE ISSUED ON CONVERSION
OF THIS NOTE.
V.
IN THE EVENT THE BORROWER SHOULD AT ANY TIME OR FROM TIME TO
TIME AFTER THE DATE HEREOF FIX A RECORD DATE FOR THE SPLIT OR SUBDIVISION OF THE
OUTSTANDING SHARES OF COMMON STOCK OR THE DETERMINATION OF HOLDERS OF COMMON
STOCK TO RECEIVE DIVIDENDS OR OTHER DISTRIBUTIONS PAYABLE IN ADDITIONAL SHARES
OF COMMON STOCK OR OTHER SECURITIES OR RIGHTS CONVERTIBLE INTO, OR ENTITLING THE
HOLDER THEREOF TO RECEIVE DIRECTLY OR INDIRECTLY, ADDITIONAL SHARES OF COMMON
STOCK ("COMMON STOCK EQUIVALENTS") WITHOUT PAYMENT OF ANY CONSIDERATION BY SUCH
HOLDER FOR THE ADDITIONAL SHARES OF COMMON STOCK OR THE COMMON STOCK
EQUIVALENTS, THEN, AS OF SUCH RECORD DATE (OR THE DATE OF SUCH DIVIDEND
DISTRIBUTION, SPLIT OR SUBDIVISION IF NO RECORD DATE IS FIXED), THE CONVERSION
PRICE OF THIS NOTE SHALL BE APPROPRIATELY DECREASED SO THAT THE NUMBER OF
CONVERSION SHARES ISSUABLE UPON CONVERSION OF THIS NOTE SHALL BE INCREASED IN
PROPORTION TO SUCH INCREASE OR POTENTIAL INCREASE OF OUTSTANDING SHARES OF
COMMON STOCK.
VI.
IF THE NUMBER OF SHARES OF COMMON STOCK OUTSTANDING AT ANY TIME
AFTER THE DATE HEREOF IS DECREASED BY A