Document:

Exhibit 4.1.1

NEITHER THESE SECURITIES NOR THE SECURITIES FOR WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE
SECURITIES OR BLUE SKY LAWS, AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE
TRANSFEROR REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES AND THE
SECURITIES ISSUABLE UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH
SECURITIES.

                                   LMIC, INC.

                                     WARRANT

Warrant No. [__] Dated March 12, 2004

LMIC, Inc., a Delaware corporation (the "Company"), hereby certifies that, for
value received, ______________________________, a ________, or his or its
registered assigns (the "Holder"), is entitled to purchase from the Company up
to a total of [__________] shares of common stock, $0.001 par value per share
(the "Common Stock"), of the Company (each such share, a "Warrant Share" and all
such shares, the "Warrant Shares") at an exercise price equal to $1.50 per share
(as adjusted from time to time as provided in Section 9, the ("Exercise Price"),
at any time and from time to time from and after the date hereof and through and
including March __, 2009 (the "Expiration Date"), and subject to the following
terms and conditions.

This Warrant (this "Warrant") is one of a series of similar warrants issued
pursuant to that certain Warrant Purchase Agreement, dated as of the date
hereof, by and among the Company and the Purchasers identified therein (the
"Purchase Agreement"). All such warrants are referred to herein, collectively,
as the "Warrants" and entitle all holders thereof (including the Holder) to
purchase an aggregate of 3,333,333 Warrant Shares.

    1. DEFINITIONS.

In addition to the terms defined elsewhere in this Warrant, capitalized terms
that are not otherwise defined herein have the meanings given to such terms in
the Purchase Agreement.

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    2. REGISTRATION OF WARRANT.

The Company shall register this Warrant, upon records to be maintained by the
Company for that purpose (the "Warrant Register"), in the name of the record
Holder hereof from time to time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose of any
exercise hereof or any distribution to the Holder, and for all other purposes,
absent actual notice to the contrary.

    3. REGISTRATION OF TRANSFERS.

The Company shall, subject to compliance with the restrictions on transfer
contained in the Purchase Agreement, register the transfer of any portion of
this Warrant in the Warrant Register, upon surrender of this Warrant, with the
Form of Assignment attached hereto duly completed and signed, with such other
documents as the Transfer Agent may reasonably request, to the Transfer Agent or
to the Company at its address specified herein. Upon any such registration or
transfer, a new warrant to purchase Common Stock, in substantially the form of
this Warrant (any such new warrant, a "New Warrant"), evidencing the portion of
this Warrant so transferred shall be issued to the transferee and a New Warrant
evidencing the remaining portion of this Warrant not so transferred, if any,
shall be issued to the transferring Holder. The acceptance of the New Warrant by
the transferee thereof shall be deemed the acceptance by such transferee of all
of the rights and obligations of a holder of a Warrant.

    4. EXERCISE AND DURATION OF WARRANTS.

(a) This Warrant shall be exercisable by the registered Holder at any time and
from time to time on or after the date hereof to and including the Expiration
Date. At 6:30 P.M., New York City time on the Expiration Date, the portion of
this Warrant not exercised prior thereto shall be and become void and of no
value; provided that, not earlier than 90 days and not later than 30 days prior
to the Expiration Date, the Company shall give written notice to the Holder of
the pending expiration of this Warrant. Notwithstanding anything to the contrary
herein, the Expiration Date shall be extended for each day following the
Effective Date that the Registration Statement is not effective.

(b) A Holder may exercise this Warrant by delivering to the Company (i) an
exercise notice, in the form attached hereto (the "Exercise Notice"),
appropriately completed and duly signed, and (ii) payment of the Exercise Price
for the number of Warrant Shares as to which this Warrant is being exercised
(which may take the form of a "cashless exercise" pursuant to this Section 10
below if so indicated in the Exercise Notice), and the date such items are
delivered to the Company (as determined in accordance with the notice provisions
hereof) is an "Exercise Date." The Holder shall not be required to deliver the
original Warrant in order to effect an exercise hereunder. Execution and
delivery of the Exercise Notice shall have the same effect as cancellation of
the original Warrant and issuance of a New Warrant evidencing the right to
purchase the remaining number of Warrant Shares. Holder shall deliver the
original Warrant to the Company within five (5) Trading Days of the exercise
Date.

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    5. DELIVERY OF WARRANT SHARES.

(a) Upon exercise of this Warrant, the Company shall promptly (but in no event
later than three Trading Days after the Exercise Date) issue or cause to be
issued and cause to be delivered to or upon the written order of the Holder and
in such name or names as the Holder may designate, a certificate for the Warrant
Shares issuable upon such exercise, which certificate shall contain customary
restrictive legends until such time as (i) such Warrant Shares may be sold
pursuant to a registration statement covering the resale of the Warrant Shares
and naming the Holder as a selling stockholder thereunder is then effective or
(ii) the Warrant Shares are freely transferable without volume restrictions
pursuant to Rule 144 under the Securities Act. The Holder, or any Person so
designated by the Holder to receive Warrant Shares, shall be deemed to have
become holder of record of such Warrant Shares as of the Exercise Date. The
Company shall, upon request of the Holder and if issuable without restrictive
legend, use its best efforts to deliver Warrant Shares hereunder electronically
through the Depository Trust Corporation or another established clearing
corporation performing similar functions.

(b) This Warrant is exercisable, either in its entirety or, from time to time,
for a portion of the number of Warrant Shares. Upon surrender of this Warrant
following one or more partial exercises, the Company shall issue or cause to be
issued, at its expense, a New Warrant evidencing the right to purchase the
remaining number of Warrant Shares.

(c) In addition to any other rights available to a Holder, if the Company fails
to deliver to the Holder a certificate representing Warrant Shares by the fifth
Trading Day after the date on which delivery of such certificate is required by
this Warrant, and if after such fifth Trading Day the Holder purchases (in an
open market transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by the Holder of the Warrant Shares that the Holder
anticipated receiving from the Company (a "Buy-In"), then the Company shall,
within three Trading Days after the Holder's request and in the Holder's
discretion, either (i) pay cash to the Holder in an amount equal to the Holder's
total purchase price (including brokerage commissions, if any) for the shares of
Common Stock so purchased (the "Buy-In Price"), at which point the Company's
obligation to deliver such certificate (and to issue such Common Stock) shall
terminate, or (ii) promptly honor its obligation to deliver to the Holder a
certificate or certificates representing such Common Stock and pay cash to the
Holder in an amount equal to the excess (if any) of the Buy-In Price over the
product of (A) such number of shares of Common Stock, times (B) the Closing
Price on the date of the event giving rise to the Company's obligation to
deliver such certificate.

(d) The Company's obligations to issue and deliver Warrant Shares in accordance
with the terms hereof are absolute and unconditional, irrespective of any action
or inaction by the Holder to enforce the same, any waiver or consent with
respect to any provision hereof, the recovery of any judgment against any Person
or any action to enforce the same, or any setoff, counterclaim, recoupment,
limitation or termination, or any breach or alleged breach by the Holder or any
other Person of any obligation to the Company or any violation or alleged
violation of law by the Holder or any other Person, and irrespective of any
other circumstance which might otherwise limit such obligation of the Company to
the Holder in connection with the issuance of Warrant Shares. Nothing herein
shall limit a Holder's right to pursue any other remedies available to it

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hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company's
failure to timely deliver certificates representing shares of Common Stock upon
exercise of the Warrant as required pursuant to the terms hereof.

    6. CHARGES, TAXES AND EXPENSES.

Issuance and delivery of certificates for shares of Common Stock upon exercise
of this Warrant shall be made without charge to the Holder for any issue or
transfer tax, withholding tax, transfer agent fee or other incidental tax or
expense in respect of the issuance of such certificates, all of which taxes and
expenses shall be paid by the Company; provided, however, that the Company shall
not be required to pay any tax which may be payable in respect of any transfer
involved in the registration of any certificates for Warrant Shares or Warrants
in a name other than that of the Holder or an Affiliate thereof. The Holder
shall be responsible for all other tax liability that may arise as a result of
holding or transferring this Warrant or receiving Warrant Shares upon exercise
hereof.

    7. REPLACEMENT OF WARRANT.

If this Warrant is mutilated, lost, stolen or destroyed, the Company shall issue
or cause to be issued in exchange and substitution for and upon cancellation
hereof, or in lieu of and substitution for this Warrant, a New Warrant, but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction and customary and reasonable indemnity, if requested.
Applicants for a New Warrant under such circumstances shall also comply with
such other reasonable regulations and procedures and pay such other reasonable
third-party costs as the Company may prescribe.

    8. RESERVATION OF WARRANT SHARES.

The Company covenants that it will at all times reserve and keep available out
of the aggregate of its authorized but unissued and otherwise unreserved Common
Stock, solely for the purpose of enabling it to issue Warrant Shares upon
exercise of this Warrant as herein provided, the number of Warrant Shares which
are then issuable and deliverable upon the exercise of this entire Warrant, free
from preemptive rights or any other contingent purchase rights of persons other
than the Holder (taking into account the adjustments and restrictions of Section
9). The Company covenants that all Warrant Shares so issuable and deliverable
shall, upon issuance and the payment of the applicable Exercise Price in
accordance with the terms hereof, be duly and validly authorized, issued and
fully paid and nonassessable. The Company will take all such action as may be
necessary to assure that such shares of Common Stock may be issued as provided
herein without violation of any applicable law or regulation, or of any
requirements of any securities exchange or automated quotation system upon which
the Common Stock may be listed.

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    9. CERTAIN ADJUSTMENTS.

The Exercise Price and number of Warrant Shares issuable upon exercise of this
Warrant are subject to adjustment from time to time as set forth in this Section
9.

(a) Stock Dividends and Splits. If the Company, at any time while this Warrant
is outstanding, (i) pays a stock dividend on its Common Stock or otherwise makes
a distribution on any class of capital stock that is payable in shares of Common
Stock, (ii) subdivides outstanding shares of Common Stock into a larger number
of shares, or (iii) combines outstanding shares of Common Stock into a smaller
number of shares, then in each such case the Exercise Price shall be multiplied
by a fraction of which the numerator shall be the number of shares of Common
Stock outstanding immediately before such event, on a fully diluted basis, and
of which the denominator shall be the number of shares of Common Stock
outstanding immediately after such event, on a fully diluted basis. Any
adjustment made pursuant to clause (i) of this paragraph shall become effective
immediately after the record date for the determination of stockholders entitled
to receive such dividend or distribution, and any adjustment pursuant to clause
(ii) or (iii) of this paragraph shall become effective immediately after the
effective date of such subdivision or combination.

(b) Pro Rata Distributions. If the Company, at any time while this Warrant is
outstanding, distributes to holders of Common Stock (i) evidences of its
indebtedness, (ii) any security (other than a distribution of Common Stock
covered by the preceding paragraph), (iii) rights or warrants to subscribe for
or purchase any security, or (iv) any other asset (in each case, "Distributed
Property"), then in each such case the Exercise Price in effect immediately
prior to the record date fixed for determination of stockholders entitled to
receive such distribution shall be adjusted (effective on such record date) to
equal the product of such Exercise Price times a fraction of which the
denominator shall be the average of the Closing Prices for the five Trading Days
immediately prior to (but not including) such record date and of which the
numerator shall be such average less the then fair market value of the
Distributed Property distributed in respect of one outstanding share of Common
Stock, as determined by the Company's Board of Directors in good faith;
provided, however, in no event shall the Exercise Price be reduced by more than
the fair market value of such Distributed Property. In such event, the Holder,
after receipt of the determination by the Company's Board of Directors, disputes
such valuation of the Distributed Property, the Holder shall have the right to
select an appraiser (which shall be a nationally recognized accounting firm), in
which case such fair market value shall be deemed to equal the average of the
values determined by each of such accounting firm and the Board of Directors of
the Company. As an alternative to the foregoing adjustment to the Exercise
Price, at the request of the Holder delivered before the 90th day after such
record date, the Company will deliver to such Holder, within five Trading Days
after any exercise of the Warrant that occurs after such record date, such
Distributed Property, in addition to the Warrant Shares otherwise issuable upon
such exercise (if applicable).

(c) Fundamental Transactions. If, at any time while this Warrant is outstanding,
(i) the Company effects any merger or consolidation of the Company with or into
another Person, (ii) to the extent not provided for in clause (ii) of Section
9(b) above, the Company distributes to its holders of Common Stock any
securities received in connection with any sale of all or

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substantially all of its assets in one or a series of related transactions, or
(iii) the Company effects any reclassification of the Common Stock or any
compulsory share exchange pursuant to which the Common Stock is effectively
converted into or exchanged for other securities, cash or property (other than
as a result of a subdivision or combination of shares of Common Stock covered by
Section 9(a) above) (in any such case, a "Fundamental Transaction"), then the
Holder shall have the right thereafter to receive, upon exercise of this
Warrant, the same amount and kind of securities, cash or property as it would
have been entitled to receive upon the occurrence of such Fundamental
Transaction if it had been, immediately prior to such Fundamental Transaction,
the holder of the number of Warrant Shares then issuable upon exercise in full
of this Warrant (the "Alternate Consideration"). The aggregate Exercise Price
for this Warrant will not be affected by any such Fundamental Transaction, but
the Company shall apportion such aggregate Exercise Price among the Alternate
Consideration in a reasonable manner reflecting the relative value of any
different components of the Alternate Consideration. If holders of Common Stock
are given any choice as to the securities, cash or property to be received in a
Fundamental Transaction, then the Holder shall be given the same choice as to
the Alternate Consideration it receives upon any exercise of this Warrant
following such Fundamental Transaction. At the Holder's request, any successor
to the Company or surviving entity in such Fundamental Transaction shall issue
to the Holder a new warrant consistent with the foregoing provisions and
evidencing the Holder's right to purchase the Alternate Consideration for the
aggregate Exercise Price upon exercise thereof. The terms of any agreement
pursuant to which a Fundamental Transaction is effected shall include terms
requiring any such successor or surviving entity to comply with the provisions
of this paragraph (c) and insuring that the Warrant (or any such replacement
security) will be similarly adjusted upon any subsequent transaction analogous
to a Fundamental Transaction. If the Company completes a "Rule 13e-3
transaction" as defined in Rule 13e-3 under the Exchange Act or other analogous
"going private" transaction, the Company (or any such successor or surviving
entity) will purchase the Warrant from the Holder for a purchase price, payable
in cash within five Trading Days after such request (or, if later, on the
effective date of the Rule 13e-3 transaction), equal to the consideration
payable in the going private transaction for a number of shares equal to the
Warrant Shares less the Exercise Price.

(d) Subsequent Equity Sales.

(i) If, at any time while this Warrant is outstanding, the Company or any
Subsidiary issues additional shares of Common Stock or rights, warrants, options
or other securities or debt convertible, exercisable or exchangeable for shares
of Common Stock or otherwise entitling any Person to acquire shares of Common
Stock (collectively, "Common Stock Equivalents") at an effective net price to
the Company per share of Common Stock (the "Effective Price") less than the
Exercise Price (as adjusted hereunder to such date), then the Exercise Price
shall be reduced to equal the Effective Price. If, at any time while this
Warrant is outstanding, the Company or any Subsidiary issues Common Stock or
Common Stock Equivalents at an Effective Price greater than the Exercise Price
(as adjusted hereunder to such date) but less than the average Closing Price
over the five Business Days prior to such issuance (the "Adjustment Price"),
then the Exercise Price shall be reduced to equal the product of (A) the
Exercise Price in effect immediately prior to such issuance of Common Stock or
Common Stock Equivalents times (B) a fraction, the numerator of which is the sum

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of (1) the number of shares of Common Stock outstanding immediately prior to
such issuance, plus (2) the number of shares of Common Stock which the aggregate
Effective Price of the Common Stock issued (or deemed to be issued) would
purchase at the Adjustment Price, and the denominator of which is the aggregate
number of shares of Common Stock outstanding or deemed to be outstanding
immediately after such issuance. For purposes of this paragraph, in connection
with any issuance of any Common Stock Equivalents, (A) the maximum number of
shares of Common Stock potentially issuable at any time upon conversion,
exercise or exchange of such Common Stock Equivalents (the "Deemed Number")
shall be deemed to be outstanding upon issuance of such Common Stock
Equivalents, (B) the Effective Price applicable to such Common Stock shall equal
the minimum dollar value of consideration payable to the Company to purchase
such Common Stock Equivalents and to convert, exercise or exchange them into
Common Stock (net of any discounts, fees, commissions and other expenses),
divided by the Deemed Number, and (C) no further adjustment shall be made to the
Exercise Price upon the actual issuance of Common Stock upon conversion,
exercise or exchange of such Common Stock Equivalents.

    (ii) If, at any time while this Warrant is outstanding, the Company or any
Subsidiary issues Common Stock Equivalents with an Effective Price or a number
of underlying shares that floats or resets or otherwise varies or is subject to
adjustment based (directly or indirectly) on market prices of the Common Stock
(a "Floating Price Security"), then for purposes of applying the preceding
paragraph in connection with any subsequent exercise, the Effective Price will
be determined separately on each Exercise Date and will be deemed to equal the
lowest Effective Price at which any holder of such Floating Price Security is
entitled to acquire Common Stock on such Exercise Date (regardless of whether
any such holder actually acquires any shares on such date).

    (iii) Notwithstanding the foregoing, no adjustment will be made under this
paragraph (d) in respect to any issuance of Excluded Stock.

(e) Number of Warrant Shares. Simultaneously with any adjustment to the Exercise
Price  pursuant to  paragraphs  (a), (b) or (d) of this Section 9, the number of
Warrant  Shares that may be purchased  upon  exercise of this  Warrant  shall be
increased  or  decreased  proportionately,  so that  after such  adjustment  the
aggregate Exercise Price payable hereunder for the increased or decreased number
of Warrant  Shares shall be the same as the aggregate  Exercise  Price in effect
immediately prior to such adjustment;  provided,  however, any adjustment of the
Exercise Price made pursuant to this section shall adjust back in the event none
of the  convertible  securities  which caused such  adjustment  are converted or
exercised, as the case may be.

(f) Calculations. All calculations under this Section 9 shall be made to the
nearest cent or the nearest 1/100th of a share, as applicable. The number of
shares of Common Stock outstanding at any given time shall not include shares
owned or held by or for the account of the Company, and the disposition of any
such shares shall be considered an issue or sale of Common Stock.

(g) Notice of Adjustments. Upon the occurrence of each adjustment pursuant to
this Section 9, the Company at its expense will promptly compute such adjustment
in accordance with the terms of this Warrant and prepare a certificate setting

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forth such adjustment, including a statement of the adjusted Exercise Price and
adjusted number or type of Warrant Shares or other securities issuable upon
exercise of this Warrant (as applicable), describing the transactions giving
rise to such adjustments and showing in detail the facts upon which such
adjustment is based. Upon written request, the Company will promptly deliver a
copy of each such certificate to the Holder and to the Company's Transfer Agent.

(h) Notice of Corporate Events. If the Company (i) declares a dividend or any
other distribution of cash, securities or other property in respect of its
Common Stock, including without limitation any granting of rights or warrants to
subscribe for or purchase any capital stock of the Company or any Subsidiary,
(ii) authorizes or approves, enters into any agreement contemplating or solicits
stockholder approval for any Fundamental Transaction or (iii) authorizes the
voluntary dissolution, liquidation or winding up of the affairs of the Company,
then the Company shall deliver to the Holder a notice describing the material
terms and conditions of such transaction, at least 15 calendar days prior to the
applicable record or effective date on which a Person would need to hold Common
Stock in order to participate in or vote with respect to such transaction, and
the Company will take all steps reasonably necessary in order to insure that the
Holder is given the practical opportunity to exercise this Warrant prior to such
time so as to participate in or vote with respect to such transaction; provided,
however, that the failure to deliver such notice or any defect therein shall not
affect the validity of the corporate action required to be described in such
notice.

    10. PAYMENT OF EXERCISE PRICE.

The Holder shall pay the Exercise Price either in immediately available funds,
or at the sole option of the Holder, such Holder may satisfy his or its
obligation to pay the Exercise Price through a "cashless exercise," in which
event the Company shall issue to the Holder the number of Warrant Shares
determined as follows:

                X = Y [(A-B)/A]

        where:
                X = the number of Warrant Shares to be issued to the Holder.

                Y = the  number of  Warrant  Shares  with  respect  to
which this Warrant is being exercised.

                A = the average of the Closing  Prices for the five Trading Days
immediately prior to (but not including) the Exercise Date.

                B = the Exercise Price.

For purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the Warrant Shares issued in a cashless
exercise transaction shall be deemed to have been acquired by the Holder, and
the holding period for the Warrant Shares shall be deemed to have commenced, on
the date this Warrant was originally issued pursuant to the Purchase Agreement.

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    11. LIMITATION ON EXERCISE.

Notwithstanding anything to the contrary contained herein, the number of shares
of Common Stock that may be acquired by the Holder upon any exercise of this
Warrant (or otherwise in respect hereof) shall be limited to the extent
necessary to insure that, following such exercise (or other issuance), the total
number of shares of Common Stock then beneficially owned by such Holder and its
Affiliates and any other Persons whose beneficial ownership of Common Stock
would be aggregated with the Holder's for purposes of Section 13(d) of the
Exchange Act, does not exceed 4.999% (the "Maximum Percentage") of the total
number of issued and outstanding shares of Common Stock (including for such
purpose the shares of Common Stock issuable upon such exercise). For such
purposes, beneficial ownership shall be determined in accordance with Section
13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
The Company shall, instead of issuing shares of Common Stock in excess of the
limitation referred to in this Section 11, suspend its obligation to issue
shares in excess of the foregoing limitation until such time, if any, as such
shares of Common Stock may be issued in compliance with such limitation.
Additionally, by written notice to the Company, the Holder may waive the
provisions of this Section 11 or increase or decrease the Maximum Percentage to
any other percentage specified in such notice, but (i) unless such waiver or
increase or decrease shall occur in connection with a "Sale of Control" (as
defined), in which event such waiver or increase or decrease shall be effective
immediately upon written notice thereof, any such waiver or increase will not be
effective until the 61st day after such notice is delivered to the Company, and
(ii) any such waiver or increase or decrease will apply only to the Holder and
not to any other holder of Warrants.

As used herein the term "Sale of Control" shall mean means transaction or series
of transactions in which more than 50% of the voting power of the Company is
disposed of to any one or more persons or entities who are not affiliates of the
Company as at the date hereof, or any other transaction or series of
transactions as a result of which the ability to control the Board of Directors
shall be vested in any person, entity or "group" (as such term is used in
Section 13(d)(3) of the Exchange Act) who is not an affiliate of Kwok Li or the
Company, whether such transaction is effected through an sale of all or
substantially all of the assets or securities of the Company or exchange of
stock, merger, consolidation or like combination.

    12. FRACTIONAL SHARES.

The Company shall not be required to issue or cause to be issued fractional
Warrant Shares on the exercise of this Warrant. If any fraction of a Warrant
Share would, except for the provisions of this Section, be issuable upon
exercise of this Warrant, the number of Warrant Shares to be issued will be
rounded up to the nearest whole share.

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    13. NOTICES.

Any and all notices or other communications or deliveries hereunder (including
without limitation any Exercise Notice) shall be in writing and shall be deemed
given and effective on the earliest of (i) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number
specified in this Section prior to 6:30 p.m. (New York City time) on a Trading
Day, (ii) the next Trading Day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified in
this Section on a day that is not a Trading Day or later than 6:30 p.m. (New
York City time) on any Trading Day, (iii) the Trading Day following the date of
mailing, if sent by nationally recognized overnight courier service, or (iv)
upon actual receipt by the party to whom such notice is required to be given.
The address for such notices or communications shall be as set forth in the
Purchase Agreement.

    14. WARRANT AGENT.

The Company shall serve as warrant agent under this Warrant. Upon 30 days'
notice to the Holder, the Company may appoint a new warrant agent. Any
corporation into which the Company or any new warrant agent may be merged or any
corporation resulting from any consolidation to which the Company or any new
warrant agent shall be a party or any corporation to which the Company or any
new warrant agent transfers substantially all of its corporate trust or
stockholders services business shall be a successor warrant agent under this
Warrant without any further act. Any such successor warrant agent shall promptly
cause notice of its succession as warrant agent to be mailed (by first class
mail, postage prepaid) to the Holder at the Holder's last address as shown on
the Warrant Register.

    15. MISCELLANEOUS.

(a) Subject to the restrictions on transfer set forth on the first page hereof,
this Warrant may be assigned by the Holder. This Warrant may not be assigned by
the Company except to a successor in the event of a Fundamental Transaction.
This Warrant shall be binding on and inure to the benefit of the parties hereto
and their respective successors and assigns. Subject to the preceding sentence,
nothing in this Warrant shall be construed to give to any Person other than the
Company and the Holder any legal or equitable right, remedy or cause of action
under this Warrant. This Warrant may be amended only in writing signed by the
Company and the Holder and their successors and assigns.

(b) The Company will not, by amendment of its governing documents or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the Holder against impairment. Without limiting the generality of
the foregoing, the Company (i) will not increase the par value of any Warrant
Shares above the amount payable therefore on such exercise, (ii) will take all
such action as may be reasonably necessary or appropriate in order that the
Company may validly and legally issue fully paid and

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nonassessable Warrant Shares on the exercise of this Warrant, and (iii) will not
close its stockholder books or records in any manner which interferes with the
timely exercise of this Warrant.

(c) GOVERNING LAW; VENUE; WAIVER OF JURY TRIAL. ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS WARRANT SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION
OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK, BOROUGH OF
MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED HEREIN
(INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE TRANSACTION DOCUMENTS),
AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR
PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF
ANY SUCH COURT, THAT VENUE OF SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH
PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO
PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY
THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH EVIDENCE OF
DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS
AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT
SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL BE DEEMED
TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.
THE COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.

(d) The headings herein are for convenience only, do not constitute a part of
this Warrant and shall not be deemed to limit or affect any of the provisions
hereof.

(e) In case any one or more of the provisions of this Warrant shall be invalid
or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Warrant shall not in any way be affected
or impaired thereby and the parties will attempt in good faith to agree upon a
valid and enforceable provision which shall be a commercially reasonable
substitute therefore, and upon so agreeing, shall incorporate such substitute
provision in this Warrant.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK, SIGNATURE PAGE FOLLOWS]

                                       11
<PAGE>

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by
its authorized officer as of the date first indicated above.

                        LMIC, INC.

                        By:_____________________________________
                        Name:___________________________________
                        Title:__________________________________

                                       12
<PAGE>

                FORM OF EXERCISE NOTICE

(To be executed by the Holder to exercise the right to purchase shares of Common
Stock under the foregoing Warrant)

To: LMIC, INC.
The undersigned is the Holder of Warrant No. _______ (the "Warrant") issued by
LMIC, Inc., a Delaware corporation (the "Company"). Capitalized terms used
herein and not otherwise defined have the respective meanings set forth in the
Warrant.

1.  The Warrant is currently  exercisable to purchase a total of  ______________
    Warrant Shares.

2.  The   undersigned   Holder   hereby   exercises   its   right  to   purchase
    _________________ Warrant Shares pursuant to the Warrant.

3.  The Holder  intends  that  payment of the  Exercise  Price  shall be made as
    (check one):

        ____ "Cash Exercise" under Section 10

        ____ "Cashless Exercise" under Section 10 (if permitted)

4.  If the holder has elected a Cash Exercise, the holder shall pay the sum of
    $____________ to the Company in accordance with the terms of the Warrant.

5.  Pursuant  to  this  exercise,  the  Company  shall  deliver  to  the  holder
    _______________ Warrant Shares in accordance with the terms of the Warrant.

6.  Following  this  exercise,  the Warrant shall be  exercisable  to purchase a
    total of ______________ Warrant Shares.

Dated:_______________,__                Name of Holder:

                        (Print)

                        By:_____________________________________
                        Name:___________________________________
                        Title:__________________________________

                        (Signature  must  conform  in all  respects  to  name of
                        holder as specified on the face of the Warrant.)

                                       13
<PAGE>

                FORM OF ASSIGNMENT

[To be completed and signed only upon transfer of Warrant]

FOR VALUE  RECEIVED,  the undersigned  hereby sells,  assigns and transfers unto
________________________________  the right represented by the within Warrant to
purchase  ____________  shares of Common Stock of LMIC, Inc. to which the within
Warrant relates and appoints ________________ attorney to transfer said right on
the books of LMIC, Inc. with full power of substitution in the premises.

Dated:________________,__

                        ____________________________________
                        (Signature  must  conform  in all  respects  to  name of
                        holder as specified on the face of the Warrant)

                        ____________________________________
                        Address of Transferee

                        ____________________________________

                        ____________________________________

In the presence of:

____________________________________EXHIBIT 4.2.1

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE
HAVE  BEEN  REGISTERED  WITH  THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR THE
SECURITIES   COMMISSION  OF  ANY  STATE  IN  RELIANCE  UPON  AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS  EVIDENCED BY A LEGAL  OPINION OF COUNSEL TO THE  TRANSFEROR
REASONABLY  ACCEPTABLE  TO THE COMPANY TO SUCH  EFFECT,  THE  SUBSTANCE OF WHICH
SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THE TRANSFER OF THIS SECURITY AND
THE  SECURITIES  ISSUABLE  UPON  CONVERSION  OF THIS  SECURITY IS SUBJECT TO THE
RESTRICTIONS  ON TRANSFER SET FORTH  HEREIN.  THIS  SECURITY AND THE  SECURITIES
ISSUABLE UPON  CONVERSION  OF THIS SECURITY MAY BE PLEDGED IN CONNECTION  WITH A
BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

                                                Date of Issuance: March 11, 2004

                                                                      $5,000,000

                            4% CONVERTIBLE DEBENTURE
                             DUE SEPTEMBER 11, 2006

            This  DEBENTURE is one of a series of duly  authorized and issued 4%
Convertible Debentures of LMIC, Inc., a Delaware corporation, having a principal
place of business at 6435 Virginia Manor Road,  Beltsville,  Maryland 20705 (the
"Company"),  designated as its 4% Convertible Debenture,  due September 11, 2006
(the "Debentures").

         FOR VALUE RECEIVED, the Company promises to pay to Omicron Master Trust
or its  registered  assigns (the  "Holder"),  the principal sum of $5,000,000 on
September  11, 2006 or such  earlier date as the  Debentures  are required to be
repaid as provided  hereunder (the "Maturity Date"),  and to pay interest to the
Holder on the aggregate  unconverted and then  outstanding  principal  amount of
this  Debenture  at the rate of 4% per annum,  payable  quarterly  on January 1,
April 1,  July 1 and  October  1,  beginning  on the first  such date  after the
Original Issue Date and on each  Conversion  Date (as to that  principal  amount
then being converted) and on the Maturity Date (except that, if any such date is
not a  Business  Day,  then  such  payment  shall be due on the next  succeeding
Business Day) (each such date, an "Interest Payment Date"), in cash

<PAGE>

or shares of Common  Stock at the Interest  Conversion  Rate,  or a  combination
thereof; provided,  however, payment in shares of Common Stock may only occur if
during the 20 Trading Days  immediately  preceding the Interest Payment Date all
of the  Equity  Conditions  have been met and the  Company  shall have given the
Holder  notice in  accordance  with the  notice  requirements  set forth  below.
Subject to the terms and conditions herein, the decision whether to pay interest
hereunder  in shares of Common Stock or cash shall be at the  discretion  of the
Company.  Not less than 20 Trading Days prior to each Interest Payment Date, the
Company  shall  provide the Holder with  written  notice of its  election to pay
interest  hereunder  either in cash or shares of Common  Stock (the  Company may
indicate  in such  notice  that the  election  contained  in such  notice  shall
continue for later  periods until  revised).  Within 20 Trading Days prior to an
Interest Payment Date, the Company's  election  (whether specific to an Interest
Payment Date or continuous)  shall be  irrevocable  as to such Interest  Payment
Date. Subject to the aforementioned  conditions,  failure to timely provide such
written notice shall be deemed an election by the Company to pay the interest on
such Interest Payment Date in cash. Interest shall be calculated on the basis of
a 360-day  year and shall  accrue daily  commencing  on the Original  Issue Date
until payment in full of the principal sum, together with all accrued and unpaid
interest  and other  amounts  which may  become  due  hereunder,  has been made.
Payment of interest in shares of Common Stock shall  otherwise occur pursuant to
Section  4(b) and only for  purposes of the  payment of interest in shares,  the
Interest Payment Date shall be deemed the Conversion Date.  Interest shall cease
to accrue with respect to any principal  amount  converted,  when the Company in
fact delivers the  Underlying  Shares.  Interest  hereunder  will be paid to the
Person in whose name this  Debenture is registered on the records of the Company
regarding  registration and transfers of Debentures (the "Debenture  Register").
Except as otherwise  provided  herein,  if at anytime the Company pays  interest
partially  in cash and  partially in shares of Common  Stock,  then such payment
shall be distributed  ratably among the Holders based upon the principal  amount
of Debentures then held by each Holder.  All overdue accrued and unpaid interest
to be paid  hereunder  shall  entail a late fee at the rate of 18% per annum (or
such lower maximum amount of interest  permitted to be charged under  applicable
law) ("Late Fee") which will accrue  daily,  from the date such  interest is due
hereunder  through and including the date of payment.  Except as provided for in
Section 5, the  Company may not prepay any  portion of the  principal  amount of
this Debenture without the prior written consent of the Holder.

         This Debenture is subject to the following additional provisions:

         Section 1. Exchange of Debentures.  This Debenture is exchangeable  for
an equal  aggregate  principal  amount of  Debentures  of  different  authorized
denominations,  as requested  by the Holder  surrendering  the same.  No service
charge will be made for such registration of transfer or exchange, provided that
the Company  shall not be required to pay any tax that may be payable in respect
of any transfer involved in the issuance and delivery of any such certificate in
a name other than that of the then present  Holder of such  Debentures,  and the
Company  shall not be required to issue or deliver such  certificates  unless or
until the person or persons  requesting the issuance  thereof shall have paid to
the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid. Notwithstanding

                                       2
<PAGE>

anything to the contrary in this  Debenture,  the Holder and its transferees may
only transfer or assign this Debenture if all of the following criteria are met:
(a) the transfer or assignment is in an increment of $500,000  principal  amount
(or lesser outstanding  amount),  (b) no more than three transfer or assignments
in the  aggregate by all holders of  Debentures  in any 12 month period shall be
permitted,  and (c) such  transfer  or  assignment  is to a person that is not a
competitor (or an affiliate of a competitor) of the Company.

         Section 2. Registration and Transfer of Debentures.  This Debenture has
been issued subject to certain investment representations of the original Holder
set forth in the Purchase  Agreement and may be transferred or exchanged only in
compliance  with  the  Purchase  Agreement  and  applicable  federal  and  state
securities  laws and  regulations.  Prior to due  presentment to the Company for
transfer of this  Debenture,  the Company and any agent of the Company may treat
the Person in whose name this  Debenture  is duly  registered  on the  Debenture
Register  as the owner  hereof for the  purpose of  receiving  payment as herein
provided and for all other  purposes,  whether or not this Debenture is overdue,
and  neither  the  Company nor any such agent shall be affected by notice to the
contrary.

         Section 3.  Events of Default.

                  a) "Event of Default",  wherever used herein, means any one of
         the  following  events  (whatever  the reason  and  whether it shall be
         voluntary or involuntary or effected by operation of law or pursuant to
         any  judgment,  decree or order of any  court,  or any  order,  rule or
         regulation of any administrative or governmental body):

                           i) any  default in the payment of the  principal  of,
                  interest  (including  Late Fees) on, or liquidated  damages in
                  respect   of,   any   Debentures,   free  of  any   claim   of
                  subordination,  as and  when  the same  shall  become  due and
                  payable  (whether on a Conversion Date or the Maturity Date or
                  by acceleration  or otherwise)  which default is not cured, if
                  possible  to cure,  within 5  Trading  Days of  notice of such
                  default sent by the Holder;

                           ii) the Company  shall fail to observe or perform any
                  other  covenant,   agreement  or  warranty  contained  in,  or
                  otherwise commit any material breach of any of the Transaction
                  Documents   (other  than  a  breach  by  the  Company  of  its
                  obligations  to deliver  shares of Common  Stock to the Holder
                  upon conversion or interest  payment which breach is addressed
                  in clause (vi) below) which is not cured, if possible to cure,
                  within 10 Trading  Days after  notice of such  default sent by
                  the Holder;

                           iii) the  Company  or any of its  subsidiaries  shall
                  commence,  or there shall be commenced  against the Company or
                  any such subsidiary a case under any applicable  bankruptcy or
                  insolvency laws as now or hereafter in effect or any successor
                  thereto, or the Company or any Subsidiary  commences any other

                                       3
<PAGE>

                  similar  proceeding  under  any  reorganization,  arrangement,
                  adjustment of debt, relief of debtors, dissolution, insolvency
                  or liquidation or similar law of any jurisdiction  whether now
                  or  hereafter  in  effect  relating  to  the  Company  or  any
                  Subsidiary  thereof or there is commenced  against the Company
                  or any Subsidiary  thereof any such bankruptcy,  insolvency or
                  other proceeding which remains  undismissed for a period of 60
                  days; or the Company or any subsidiary  thereof is adjudicated
                  insolvent or bankrupt; or any order of relief or other similar
                  order approving any such case or proceeding is entered; or the
                  Company or any Subsidiary  thereof  suffers any appointment of
                  any  custodian or the like for it or any  substantial  part of
                  its property which  continues  undischarged  or unstayed for a
                  period of 60 days;  or the Company or any  Subsidiary  thereof
                  makes a general  assignment  for the benefit of creditors;  or
                  the  Company  shall  fail to pay,  or shall  state  that it is
                  unable to pay, or shall be unable to pay, its debts  generally
                  as they become due; or the Company or any  Subsidiary  thereof
                  shall  expressly  indicate  its  consent  to,  approval  of or
                  acquiescence in any of the foregoing;

                           iv) the Company or any  Subsidiary  shall  default in
                  any  of its  obligations  under  any  other  Debenture  or any
                  mortgage, credit agreement or other credit facility, indenture
                  agreement, factoring agreement or other instrument under which
                  there  may be  issued,  or by which  there may be  secured  or
                  evidenced,  any  indebtedness  for borrowed money or money due
                  under any long term  leasing or factoring  arrangement  of the
                  Company in an amount  exceeding  $500,000 in the aggregate for
                  the Company and its  Subsidiaries,  whether such  indebtedness
                  now exists or shall  hereafter  be created,  and such  default
                  shall result in such  indebtedness  becoming or being declared
                  due and payable prior to the date on which it would  otherwise
                  become due and payable;

                           v) the Company shall redeem or repurchase more than a
                  de minimis number of its outstanding shares of Common Stock or
                  other equity securities of the Company (other than redemptions
                  of Underlying Shares and repurchases of shares of Common Stock
                  or other equity securities of departing officers and directors
                  of the Company;  provided no repurchase  shall exceed $100,000
                  for any officer or director);

                           vi) the Company  shall fail for any reason to deliver
                  certificates  to a Holder on or prior to the 10th  Trading Day
                  after a Conversion  Date  pursuant to and in  accordance  with
                  Section  4(b)  or the  Company  shall  provide  notice  to the
                  Holder, including by way of public announcement,  at any time,
                  of its intention  not to comply with requests for  conversions
                  of any Debentures in accordance with the terms hereof; or

                                       4
<PAGE>

                           vii) the Company shall fail for any reason to deliver
                  the payment in cash  pursuant to a Buy-In (as defined  herein)
                  within fifteen  Trading Days after notice thereof is delivered
                  hereunder.

                  b) If any Event of Default occurs,  the full principal  amount
         of this  Debenture,  together  with interest and other amounts owing in
         respect  thereof,  to the date of  acceleration,  shall become,  at the
         Holder's  election,  immediately due and payable in cash. The aggregate
         amount payable upon acceleration following an Event of Default shall be
         equal to the Mandatory Prepayment Amount.  Commencing five Trading Days
         after  the  occurrence  of any Event of  Default  that  results  in the
         eventual  acceleration  of this  Debenture,  the interest  rate on this
         Debenture  shall  accrue at the rate of (18%) per annum (or such  lower
         maximum  amount of interest  permitted to be charged  under  applicable
         laws).  All  Debentures  for  which  the  Mandatory  Prepayment  Amount
         hereunder shall have been paid in accordance herewith shall promptly be
         surrendered  to or as  directed  by the  Company.  The Holder  need not
         provide and the Company hereby waives any presentment,  demand, protest
         or other notice of any kind, and the Holder may immediately and without
         expiration  of any grace  period  enforce any and all of its rights and
         remedies  hereunder  and  all  other  remedies  available  to it  under
         applicable  law. Such  declaration may be rescinded and annulled by the
         Holder at any time prior to payment hereunder and the Holder shall have
         all rights as a Debenture  holder until such time,  if any, as the full
         payment  under this  Section  shall have been  received  by it. No such
         rescission or annulment shall affect any subsequent Event of Default or
         impair any right consequent thereon.

         Section 4.  Conversion.

                  a) i) At any time  after the  Original  Issue  Date until this
                  Debenture is no longer  outstanding,  this Debenture  shall be
                  convertible  into shares of Common  Stock at the option of the
                  Holder,  in whole or in part at any time and from time to time
                  (subject to the limitations on conversion set forth in Section
                  4(a)(ii)  hereof).  The Holder  shall  effect  conversions  by
                  delivering  to the  Company  the form of Notice of  Conversion
                  attached  hereto  as  Annex  A  (a  "Notice  of  Conversion"),
                  specifying  therein the  principal  amount of Debentures to be
                  converted  and the  date on  which  such  conversion  is to be
                  effected (a "Conversion  Date"),  which date shall not be more
                  than  10  Trading  Days  after   delivery  of  the  Notice  of
                  Conversion and the Conversion  Certificate  (as defined in the
                  Custodial  Agreement) as to such conversion.  If no Conversion
                  Date is specified in a Notice of  Conversion,  the  Conversion
                  Date  shall be the date that  such  Notice  of  Conversion  is
                  provided  hereunder.  To  effect  conversions  hereunder,  the
                  Holder   shall  not  be  required  to   physically   surrender
                  Debentures to the Company unless the entire  principal  amount
                  of this Debenture plus all accrued and unpaid interest thereon
                  has been so converted.  Conversions  hereunder  shall have the
                  effect of lowering the  outstanding  principal  amount of this
                  Debenture in an amount equal

                                       5
<PAGE>

                  to the applicable conversion. The Holder and the Company shall
                  maintain  records showing the principal  amount  converted and
                  the date of such  conversions.  The Company  shall deliver any
                  objection  to any Notice of  Conversion  within 3 Trading Days
                  after receipt of such notice. The Holder and any assignee,  by
                  acceptance of this  Debenture,  acknowledge and agree that, by
                  reason  of  the  provisions  of  this   paragraph,   following
                  conversion  of a portion  of this  Debenture,  the  unpaid and
                  unconverted  principal  amount of this  Debenture  may be less
                  than the amount stated on the face hereof.

                           ii)  Conversion  Limitations.  The Company  shall not
                  effect any conversion of this Debenture,  and the Holder shall
                  not have the right to convert any  portion of this  Debenture,
                  pursuant to Section  4(a)(i) or otherwise,  to the extent that
                  after giving effect to such  conversion,  the Holder (together
                  with the Holder's affiliates),  as set forth on the applicable
                  Notice  of  Conversion,  would  beneficially  own in excess of
                  4.99% of the number of shares of the Common Stock  outstanding
                  immediately  after  giving  effect  to  such  conversion.  For
                  purposes of the  foregoing  sentence,  the number of shares of
                  Common  Stock   beneficially  owned  by  the  Holder  and  its
                  affiliates  shall include the number of shares of Common Stock
                  issuable  upon  conversion of this  Debenture  with respect to
                  which the  determination  of such sentence is being made,  but
                  shall exclude the number of shares of Common Stock which would
                  be issuable upon (A) conversion of the remaining, nonconverted
                  portion of this Debenture  beneficially owned by the Holder or
                  any of its  affiliates  and (B) exercise or  conversion of the
                  unexercised or nonconverted portion of any other securities of
                  the Company  (including any other  Debentures or the Warrants)
                  subject to a limitation on conversion or exercise analogous to
                  the  limitation  contained  herein  beneficially  owned by the
                  Holder  or any of its  affiliates.  Except as set forth in the
                  preceding  sentence,  for purposes of this  Section  4(a)(ii),
                  beneficial  ownership  shall be calculated in accordance  with
                  Section  13(d) of the  Exchange  Act.  To the extent  that the
                  limitation  contained in this Section  4(a)(ii)  applies,  the
                  determination  of whether this  Debenture is  convertible  (in
                  relation to other securities owned by the Holder) and of which
                  a portion of this  Debenture  is  convertible  shall be in the
                  sole discretion of such Holder. To ensure compliance with this
                  restriction,  the Holder  will be deemed to  represent  to the
                  Company each time it delivers a Notice of Conversion that such
                  Notice of  Conversion  has not violated the  restrictions  set
                  forth  in  this  paragraph  and  the  Company  shall  have  no
                  obligation   to  verify  or  confirm  the   accuracy  of  such
                  determination.  For  purposes  of this  Section  4(a)(ii),  in
                  determining the number of outstanding  shares of Common Stock,
                  the  Holder may rely on the  number of  outstanding  shares of
                  Common Stock as reflected in the most recent of the following:
                  (x) the  Company's  most recent Form 10-Q or Form 10-K, as the
                  case may be,  (y) a more  recent  public  announcement  by the
                  Company  or  (z)  any  other  notice  by  the  Company  or the
                  Company's transfer agent setting forth the number of shares of
                  Common Stock outstanding.  Upon the

                                       6
<PAGE>

                  written  or oral  request of the  Holder,  the  Company  shall
                  within two Trading Days  confirm  orally and in writing to the
                  Holder the number of shares of Common Stock then  outstanding.
                  In any case, the number of outstanding  shares of Common Stock
                  shall be determined  after giving effect to the  conversion or
                  exercise  of  securities  of  the  Company,   including   this
                  Debenture,  by the Holder or its affiliates  since the date as
                  of which such number of outstanding shares of Common Stock was
                  reported.

                           iii)  Underlying  Shares  Issuable Upon Conversion of
                  Principal  Amount.  The  number  of  shares  of  Common  Stock
                  issuable upon a conversion shall be determined by the quotient
                  obtained by dividing (x) the outstanding  principal  amount of
                  this Debenture to be converted by (y) the Set Price.

                  (b) i) Not later than five Trading  Days after any  Conversion
                  Date,  the Company will deliver to the Holder a certificate or
                  certificates representing the Underlying Shares which shall be
                  free of restrictive  legends and trading  restrictions  (other
                  than those  required by the Purchase  Agreement)  representing
                  the number of shares of Common Stock being  acquired  upon the
                  conversion of Debentures  (including,  if so timely elected by
                  the Company,  shares of Common Stock  representing the payment
                  of accrued  interest) and (B) a check in the amount of accrued
                  and unpaid interest (if the Company is required to pay accrued
                  interest in cash) on the principal  amount of Debentures  then
                  being  converted.  The  Company  shall,  if  available  and if
                  allowed under  applicable  securities  laws, use  commercially
                  reasonable  efforts to deliver any certificate or certificates
                  required to be  delivered  by the Company  under this  Section
                  electronically  through the  Depository  Trust  Corporation or
                  another established  clearing  corporation  performing similar
                  functions.  If in the case of any  Notice of  Conversion  such
                  certificate  or  certificates  are  not  delivered  to  or  as
                  directed  by the  applicable  Holder by the third  Trading Day
                  after a  Conversion  Date,  the Holder  shall be  entitled  by
                  written  notice to the  Company  at any time on or before  its
                  receipt of such  certificate or  certificates  thereafter,  to
                  rescind  such  conversion,  in which event the  Company  shall
                  immediately return the certificates representing the principal
                  amount of Debentures tendered for conversion.

                           ii) If the Company fails for any reason to deliver to
                  the  Holder  such  certificate  or  certificates  pursuant  to
                  Section   4(b)(i)  by  the  seventh   Trading  Day  after  the
                  Conversion  Date,  the Company  shall pay to such  Holder,  in
                  cash, as partial liquidated damages and not as a penalty,  for
                  each  $5,000 of  principal  amount  being  converted,  $25 per
                  Trading Day (increasing to $50 per Trading Day after 3 Trading
                  Days after such damages  begin to accrue) for each Trading Day
                  after such  seventh  Trading Day until such  certificates  are
                  delivered.  The Company's obligations to issue and deliver the
                  Underlying   Shares  upon  conversion  of  this  Debenture  in
                  accordance with the terms hereof are absolute and

                                       7
<PAGE>

                  unconditional,  irrespective  of any action or inaction by the
                  Holder to enforce the same, any waiver or consent with respect
                  to any provision hereof,  the recovery of any judgment against
                  any Person or any action to enforce  the same,  or any setoff,
                  counterclaim,  recoupment,  limitation or termination,  or any
                  breach or alleged  breach by the Holder or any other Person of
                  any  obligation  to the  Company or any  violation  or alleged
                  violation  of law by  the  Holder  or  any  other  person  and
                  irrespective of any other  circumstance  which might otherwise
                  limit  such  obligation  of  the  Company  to  the  Holder  in
                  connection  with  the  issuance  of  such  Underlying  Shares;
                  provided, however, such delivery shall not operate as a waiver
                  by the Company of any such action the Company may have against
                  the  Holder.  In the  event a Holder of this  Debenture  shall
                  elect  to  convert  any or all  of the  outstanding  principal
                  amount hereof,  the Company may not refuse conversion based on
                  any claim that the Holder or any one  associated or affiliated
                  with the Holder of has been  engaged in any  violation of law,
                  agreement or for any other reason,  unless, an injunction from
                  a court, on notice, restraining and or enjoining conversion of
                  all or part of this  Debenture  shall  have  been  sought  and
                  obtained. In the absence of an injunction precluding the same,
                  the Company shall issue  Conversion  Shares or, if applicable,
                  cash, upon a properly noticed conversion. Nothing herein shall
                  limit a Holder's  right to pursue actual damages or declare an
                  Event  of  Default  pursuant  to  Section  3  herein  for  the
                  Company's  failure to  deliver  Conversion  Shares  within the
                  period  specified  herein and such Holder shall have the right
                  to pursue  all  remedies  available  to it at law or in equity
                  including,   without   limitation,   a  decree   of   specific
                  performance and/or injunctive relief. The exercise of any such
                  rights  shall not prohibit the Holders from seeking to enforce
                  damages   pursuant  to  any  other  Section  hereof  or  under
                  applicable  law.   Notwithstanding   anything  herein  to  the
                  contrary,  liquidated  damages hereunder that accrue as to any
                  Conversion  Shares  shall not be payable to a Purchaser if the
                  Purchaser  has  previously  demanded,  as to  such  Conversion
                  Shares,  liquidated  damages pursuant to Section 4.1(d) of the
                  Purchase  Agreement  or  "buy-in"   compensation  pursuant  to
                  Section 4(b)(iii) of this Debenture.

                           (iii) In addition to any other  rights  available  to
                  the Holder,  if the Company fails for any reason to deliver to
                  the  Holder  such  certificate  or  certificates  pursuant  to
                  Section  4(b)(i) by the fifth Trading Day after the Conversion
                  Date,  and if after  such  fifth  Trading  Day the  Holder  is
                  required by its brokerage  firm to purchase (in an open market
                  transaction   or   otherwise)   Common  Stock  to  deliver  in
                  satisfaction of a sale by such Holder of the Underlying Shares
                  which the Holder anticipated receiving upon such conversion (a
                  "Buy-In"),  then  the  Company  shall  (A)  pay in cash to the
                  Holder (in addition to any remedies available to or elected by
                  the  Holder)  the  amount  by  which  (x) the  Holder's  total
                  purchase price (including brokerage  commissions,  if any) for
                  the Common Stock so  purchased  exceeds (y) the product of (1)
                  the  aggregate  number of shares  of  Common  Stock  that such
                  Holder was entitled to receive as a result of the

                                       8
<PAGE>

                  conversion at issue multiplied by (2) the actual sale price of
                  the Common Stock at the time of the sale (including  brokerage
                  commissions,  if any) giving rise to such purchase  obligation
                  and (B) at the option of the Holder, either reissue Debentures
                  in  principal  amount  equal to the  principal  amount  of the
                  attempted  conversion  or  deliver to the Holder the number of
                  shares of Common  Stock that  would  have been  issued had the
                  Company timely complied with its delivery  requirements  under
                  Section 4(b)(i).  For example,  if the Holder purchases Common
                  Stock  having a total  purchase  price of  $11,000  to cover a
                  Buy-In with respect to an attempted  conversion  of Debentures
                  with respect to which the actual sale price of the  Underlying
                  Shares   at  the  time  of  the  sale   (including   brokerage
                  commissions,  if any) giving rise to such purchase  obligation
                  was a total of $10,000  under  clause  (A) of the  immediately
                  preceding  sentence,  the Company shall be required to pay the
                  Holder  $1,000.  The Holder shall provide the Company  written
                  notice indicating the amounts payable to the Holder in respect
                  of the Buy-In.  Notwithstanding  anything  contained herein to
                  the contrary, if a Holder requires the Company to make payment
                  in  respect  of a Buy-In  for the  failure  to timely  deliver
                  certificates  hereunder  and the  Company  timely pays in full
                  such  payment,  the Company  shall not be required to pay such
                  Holder partial  liquidated  damages under Section  4(b)(ii) in
                  respect  of  the   certificates   resulting  in  such  Buy-In.
                  Notwithstanding  anything  herein  to  the  contrary,   Buy-In
                  compensation  hereunder  that is payable as to any  Conversion
                  Shares  shall not be payable to a Purchaser  if the  Purchaser
                  has  previously  demanded,   as  to  such  Conversion  Shares,
                  liquidated  damages pursuant to Section 4.1(d) of the Purchase
                  Agreement or liquidated  damages  pursuant to Section 4(b)(ii)
                  of this Debenture.

                           (iv) Notwithstanding anything herein to the contrary,
                  if  after  the  Effective  Date  the  VWAP  for each of any 15
                  consecutive  Trading  Days  ("Threshold  Period"),   which  15
                  consecutive Trading Day period shall have commenced only after
                  the Effective  Date, is 200% or more of the then effective Set
                  Price (defined below),  the Company may, within 3 Trading Days
                  after  any such  Threshold  Period,  deliver  a notice  to the
                  Holder (a "Forced  Conversion Notice" and the date such notice
                  is  received  by the Holder,  the  "Forced  Conversion  Notice
                  Date") to cause the Holder to immediately  convert all or part
                  of  the  then  outstanding   principal  amount  of  Debentures
                  pursuant to Section 4(a)(i) and the Holder shall surrender (if
                  the entire  Debenture  is  converted)  this  Debenture  to the
                  Company  for  conversion  within 5 Trading  Days of the Forced
                  Conversion  Notice Date.  The Company may only effect a Forced
                  Conversion  Notice if (a) during the period beginning with the
                  Threshold  Period and ending on the 3rd Trading Day  following
                  the  Forced   Conversion   Notice  Date,  all  of  the  Equity
                  Conditions  shall  have  been  met and (b) the  average  daily
                  trading  volume of the Common Stock exceeds  30,000 shares for
                  any 20  consecutive  Trading  Days  immediately  prior  to the
                  Forced Conversion Notice Date. If any of the Equity Conditions
                  shall cease to be  satisfied  at any time during the  required
                  period, then the Forced Conversion

                                       9
<PAGE>

                  Notice shall be null and void,  ab initio.  To the extent that
                  the   limitation  of  Section   4(a)(ii)   would  prevent  the
                  conversion of all or a portion of this Debenture on the Forced
                  Conversion  Notice  Date,  then  from  and  after  the  Forced
                  Conversion  Notice  Date:  (x) the  Debenture  shall  cease to
                  accrue interest, and (y) all Events of Default (other than (A)
                  Events of Default  arising  out of  nonpayment  at maturity or
                  upon a Redemption  Demand following a Holder Redemption Right,
                  (B)  Events of  Default  arising  out of breach of a  covenant
                  contained  in the  Debenture  relating  to  conversion  of the
                  Debentures,  or (C) Event of Default 3(a)(ii) arising out of a
                  Transaction  Document  other  than  the  Debentures)  shall be
                  deemed to be waived  and (z) the  Holder  shall  deliver  (and
                  shall be  deemed  to have  delivered)  a  Consent  Certificate
                  pursuant to the Custodial and Security Agreement releasing all
                  funds on deposit with the Custodian  pursuant to the Custodial
                  and Security Agreement.

                  (c) i) The conversion  price in effect on any Conversion  Date
                  shall be equal to $2.468  (subject to  adjustment  herein)(the
                  "Set Price").

                  ii) If the  Company,  at any time  while  the  Debentures  are
                  outstanding:  (A) shall pay a stock dividend or otherwise make
                  a distribution or  distributions on shares of its Common Stock
                  or any other equity or equity equivalent securities payable in
                  shares of Common Stock (which,  for avoidance of doubt,  shall
                  not include any shares of Common  Stock  issued by the Company
                  pursuant to this  Debenture,  including as interest  thereon),
                  (B)  subdivide its  outstanding  shares of Common Stock into a
                  larger  number of shares,  (C)  combine  (including  by way of
                  reverse  stock split) its  outstanding  shares of Common Stock
                  into  a   smaller   number   of   shares,   or  (D)  issue  by
                  reclassification  of shares of the Common  Stock any shares of
                  capital  stock of the  Company,  then the Set  Price  shall be
                  multiplied by a fraction of which the  numerator  shall be the
                  number of shares of Common Stock  (excluding  treasury shares,
                  if  any)  outstanding  before  such  event  and of  which  the
                  denominator  shall be the  number of  shares  of Common  Stock
                  outstanding  after such event. Any adjustment made pursuant to
                  this Section  shall  become  effective  immediately  after the
                  record date for the determination of stockholders  entitled to
                  receive  such  dividend  or  distribution   and  shall  become
                  effective  immediately after the effective date in the case of
                  a subdivision, combination or re-classification.

                  iii) If the Company or any subsidiary  thereof, as applicable,
                  at any time while  Debentures  are  outstanding,  shall offer,
                  sell, grant any option to purchase or offer, sell or grant any
                  right to reprice its  securities,  or otherwise  dispose of or
                  issue (or  announce  any offer,  sale,  grant or any option to
                  purchase or other  disposition)  any Capital Shares or Capital
                  Shares  Equivalents  entitling any Person to acquire shares of
                  Common  Stock at an  effective  price per share  less than the
                  then Set Price ("Dilutive  Issuance"),  as adjusted  hereunder
                  (if  the  holder  of the  Capital  Shares  or  Capital  Shares
                  Equivalents so issued shall at any time,  whether by operation
                  of purchase  price  adjustments,  reset  provisions,  floating
                  conversion,

                                       10
<PAGE>

                  exercise or exchange prices or otherwise,  or due to warrants,
                  options or rights per share which is issued in connection with
                  such  issuance,  be entitled to receive shares of Common Stock
                  at an  effective  price per  share  which is less than the Set
                  Price, such issuance shall be deemed to have occurred for less
                  than the Set  Price),  then the Set Price  shall be reduced to
                  equal the effective conversion, exchange or purchase price for
                  such Capital Shares or Capital Shares  Equivalents  (including
                  any reset provisions  thereof) at issue. Such adjustment shall
                  be  made  whenever  such  Capital  Shares  or  Capital  Shares
                  Equivalents are issued. The Company shall notify the Holder in
                  writing, no later than the business day following the issuance
                  of any Capital Shares or Capital Shares Equivalents subject to
                  this  section,  indicating  therein  the  applicable  issuance
                  price,   or  of  applicable   reset  price,   exchange  price,
                  conversion price and other pricing terms.

                  iv)  If  the  Company,   at  any  time  while  Debentures  are
                  outstanding,  shall  distribute to all holders of Common Stock
                  (and not to Holders)  evidences of its  indebtedness or assets
                  or  rights  or  warrants  to  subscribe  for or  purchase  any
                  security,1 then in each such case the Set Price shall be equal
                  to the  greater  of (x) the  product  of (I) the Set  Price in
                  effect   immediately  prior  to  the  record  date  fixed  for
                  determination   of  stockholders   entitled  to  receive  such
                  distribution  and (II) a  fraction  of which  the  denominator
                  shall be the VWAP  determined as of the record date  mentioned
                  above,  and of which the numerator  shall be such VWAP on such
                  record  date less the then fair  market  value at such  record
                  date of the portion of such assets or evidence of indebtedness
                  so  distributed  applicable  to one  outstanding  share of the
                  Common Stock as  determined  by the Board of Directors in good
                  faith,  and (y) the Set Price as of the record date  mentioned
                  above,  less the then fair market value at such record date of
                  the  portion of such assets or  evidence  of  indebtedness  so
                  distributed  applicable to one outstanding share of the Common
                  Stock as  determined  by the Board of Directors in good faith.
                  In  either  case  the  adjustments  shall  be  described  in a
                  statement  provided to the Holders of the portion of assets or
                  evidences of indebtedness so distributed or such  subscription
                  rights   applicable  to  one  share  of  Common  Stock.   Such
                  adjustment  shall be made  whenever any such  distribution  is
                  made and shall become effective  immediately  after the record
                  date mentioned above.

                                       11
<PAGE>

                  v) All calculations  under this Section 4 shall be made to the
                  nearest  cent or the nearest  1/100th of a share,  as the case
                  may be. For  purposes of this  Section 4, the number of shares
                  of Common  Stock  outstanding  as of a given date shall be the
                  sum of  the  number  of  shares  of  Common  Stock  (excluding
                  treasury shares, if any) outstanding.

                  vi)  Whenever  the Set Price is  adjusted  pursuant  to any of
                  Section  4(c)(ii) - (v), the Company  shall  promptly  mail to
                  each  Holder a notice  setting  forth the Set Price after such
                  adjustment  and setting  forth a brief  statement of the facts
                  requiring  such  adjustment.  If  the  Company  enters  into a
                  Variable Rate Transaction or an MFN  Transaction,  despite the
                  prohibition  thereon in the  Purchase  Agreement,  the Company
                  shall be  deemed to have  issued  Capital  Shares  or  Capital
                  Shares  Equivalents  at  the  lowest  possible  conversion  or
                  exercise  price at which such  securities  may be converted or
                  exercised in the case of a Variable Rate  Transaction,  or the
                  lowest  possible  adjustment  price  in  the  case  of an  MFN
                  Transaction.

                  vii) If (A) the Company shall declare a dividend (or any other
                  distribution)  on the  Common  Stock;  (B) the  Company  shall
                  declare  a  special   nonrecurring   cash  dividend  on  or  a
                  redemption  of  the  Common  Stock;   (C)  the  Company  shall
                  authorize  the  granting  to all  holders of the Common  Stock
                  rights or warrants to subscribe  for or purchase any shares of
                  capital stock of any class or of any rights;  (D) the approval
                  of any  stockholders  of the  Company  shall  be  required  in
                  connection with any  reclassification of the Common Stock, any
                  consolidation  or merger to which the Company is a party,  any
                  sale or transfer of all or substantially  all of the assets of
                  the Company,  of any  compulsory  share  exchange  whereby the
                  Common  Stock is  converted  into  other  securities,  cash or
                  property;  (E) the Company  shall  authorize  the voluntary or
                  involuntary  dissolution,  liquidation  or  winding  up of the
                  affairs of the Company;  then, in each case, the Company shall
                  cause to be filed at each office or agency  maintained for the
                  purpose of conversion of the Debentures, and shall cause to be
                  mailed to the  Holders at their last  addresses  as they shall
                  appear  upon  the  stock  books  of the  Company,  at least 20
                  calendar days prior to the applicable record or effective date
                  hereinafter  specified, a notice stating (x) the date on which
                  a record  is to be taken  for the  purpose  of such  dividend,
                  distribution,  redemption,  rights or warrants, or if a record
                  is not to be taken,  the date as of which the  holders  of the
                  Common  Stock  of  record  to be  entitled  to such  dividend,
                  distributions,  redemption,  rights  or  warrants  are  to  be
                  determined  or (y) the  date on which  such  reclassification,
                  consolidation,  merger,  sale,  transfer or share  exchange is
                  expected  to become  effective  or  close,  and the date as of
                  which it is  expected  that  holders  of the  Common  Stock of
                  record  shall be  entitled  to  exchange  their  shares of the
                  Common   Stock  for   securities,   cash  or  other   property
                  deliverable upon such reclassification,

                                       12
<PAGE>

                  consolidation,  merger,  sale,  transfer  or  share  exchange;
                  provided,  that the  failure to mail such notice or any defect
                  therein  or in  the  mailing  thereof  shall  not  affect  the
                  validity of the corporate  action  required to be specified in
                  such notice. Holders are entitled to convert Debentures during
                  the 20-day  period  commencing  the date of such notice to the
                  effective date of the event triggering such notice.

                  viii) If, at any time while this Debenture is outstanding, (A)
                  the Company effects any merger or consolidation of the Company
                  with or into another  Person,  or (B) the Company  effects any
                  reclassification  of the Common Stock or any compulsory  share
                  exchange  pursuant  to which the Common  Stock is  effectively
                  converted  into or  exchanged  for other  securities,  cash or
                  property (in any such case, a "Fundamental Transaction"), then
                  upon any subsequent  conversion of this Debenture,  the Holder
                  shall have the right to  receive,  for each  Underlying  Share
                  that would have been issuable upon such conversion absent such
                  Fundamental   Transaction,   the  same  kind  and   amount  of
                  securities, cash or property as it would have been entitled to
                  receive upon the occurrence of such Fundamental Transaction if
                  it  had   been,   immediately   prior   to  such   Fundamental
                  Transaction,  the  holder of one share of  Common  Stock  (the
                  "Alternate   Consideration").   For   purposes   of  any  such
                  conversion,  the  determination  of the  Set  Price  shall  be
                  appropriately    adjusted   to   apply   to   such   Alternate
                  Consideration  based on the amount of Alternate  Consideration
                  issuable  in  respect  of one  share of  Common  Stock in such
                  Fundamental  Transaction,  and the Company shall apportion the
                  Set Price among the  Alternate  Consideration  in a reasonable
                  manner   reflecting   the  relative  value  of  any  different
                  components  of the  Alternate  Consideration.  If  holders  of
                  Common Stock are given any choice as to the  securities,  cash
                  or property to be received in a Fundamental Transaction,  then
                  the Holder shall be given the same choice as to the  Alternate
                  Consideration   it  receives  upon  any   conversion  of  this
                  Debenture  following  such  Fundamental  Transaction.  To  the
                  extent necessary to effectuate the foregoing  provisions,  any
                  successor  to  the  Company  or   surviving   entity  in  such
                  Fundamental  Transaction  shall  issue  to  the  Holder  a new
                  debenture   consistent  with  the  foregoing   provisions  and
                  evidencing  the Holder's  right to convert such debenture into
                  Alternate  Consideration.  The terms of any agreement pursuant
                  to which a Fundamental  Transaction  is effected shall include
                  terms  requiring  any such  successor or  surviving  entity to
                  comply with the  provisions of this paragraph (c) and insuring
                  that this Debenture (or any such replacement security) will be
                  similarly adjusted upon any subsequent  transaction  analogous
                  to a Fundamental Transaction.

                  (ix) Notwithstanding the foregoing, no adjustment will be made
                  under this  paragraph  (c) in respect of (A) the  granting  or
                  issuance  of  shares  of  Capital  Shares  or  of  options  to
                  employees,  officers or directors  of the Company  pursuant to
                  any stock option plan agreement or arrangement duly adopted or
                  approved  by a  majority  of the  non-employee  members of the
                  Board of Directors of the Company

                                       13
<PAGE>

                  or a majority of the members of a  committee  of  non-employee
                  directors  established  for  such  purpose,  or (B)  upon  the
                  exercise  of this  Debenture  or any other  Debenture  of this
                  series  or of any  other  series or any  Warrant  or  security
                  issued by the Company in connection with the offer and sale of
                  this Company's  securities pursuant to the Purchase Agreement,
                  or (C) the issuance of any Common Stock as payment of interest
                  with respect to any Debenture,  or (D) upon the exercise of or
                  conversion of any Capital Shares Equivalents,  rights, options
                  or warrants issued and outstanding on the Original Issue Date,
                  provided  such  securities  have not been  amended in order to
                  reduce the exercise or  conversion  price  thereof or increase
                  the number of Shares issuable thereunder since the date of the
                  Purchase   Agreement  except  as  a  result  of  the  Purchase
                  Agreement,  or (E) pursuant to the Vertical Ventures Financing
                  (as defined in the Purchase Agreement).

                  (d) The Company  covenants  that it will at all times  reserve
         and keep available out of its authorized and unissued  shares of Common
         Stock  solely  for the  purpose  of  issuance  upon  conversion  of the
         Debentures  and payment of interest  on the  Debenture,  each as herein
         provided,  free from preemptive  rights or any other actual  contingent
         purchase  rights of persons other than the Holders,  not less than such
         number  of  shares  of  the  Common  Stock  as  shall  (subject  to any
         additional requirements of the Company as to reservation of such shares
         set forth in the Purchase  Agreement) be issuable  (taking into account
         the adjustments  and  restrictions of Section 4(b)) upon the conversion
         of the  outstanding  principal  amount of the Debentures and payment of
         interest  hereunder.  The Company  covenants  that all shares of Common
         Stock that shall be so issuable shall,  upon issue, be duly and validly
         authorized,   issued  and  fully  paid,   nonassessable   and,  if  the
         Registration  Statement is then  effective  under the  Securities  Act,
         registered  for  public  sale  in  accordance  with  such  Registration
         Statement.

                  (e) Upon a  conversion  hereunder  the  Company  shall  not be
         required to issue stock certificates  representing  fractions of shares
         of the  Common  Stock,  but  may if  otherwise  permitted,  make a cash
         payment in respect of any final  fraction  of a share based on the VWAP
         at such time. If the Company  elects not, or is unable,  to make such a
         cash payment,  the Holder shall be entitled to receive,  in lieu of the
         final fraction of a share, one whole share of Common Stock.

                  (f) The  issuance  of  certificates  for  shares of the Common
         Stock on conversion of the  Debentures  shall be made without charge to
         the Holders thereof for any documentary stamp or similar taxes that may
         be payable in respect  of the issue or  delivery  of such  certificate,
         provided that the Company shall not be required to pay any tax that may
         be payable in respect of any  transfer  involved  in the  issuance  and
         delivery of any such  certificate  upon conversion in a name other than
         that of the Holder of such  Debentures  so  converted  and the  Company
         shall not be required to issue or deliver such  certificates  unless or
         until the person or persons  requesting the issuance thereof shall have

                                       14
<PAGE>

         paid to the Company the amount of such tax or shall have established to
         the satisfaction of the Company that such tax has been paid.

                  (g) Any and all notices or other  communications or deliveries
         to be provided by the Holders hereunder, including, without limitation,
         any Notice of Conversion, shall be in writing and delivered personally,
         by  facsimile  or sent by a  nationally  recognized  overnight  courier
         service,  addressed  to the  Company,  at the address set forth  above,
         facsimile number ___________________ or such other address or facsimile
         number as the Company  may  specify for such  purposes by notice to the
         Holders  delivered in accordance  with this Section  4(h).  Any and all
         notices or other  communications  or  deliveries  to be provided by the
         Company  hereunder  shall be in writing and  delivered  personally,  by
         facsimile,  sent by a nationally  recognized  overnight courier service
         addressed to each Holder at the facsimile  telephone  number or address
         of such Holder  appearing  on the books of the  Company,  or if no such
         facsimile  telephone number or address appears,  at the principal place
         of  business  of the  Holder.  Any  notice  or other  communication  or
         deliveries  hereunder  shall  be  deemed  given  and  effective  on the
         earliest  of  (i)  the  date  of   transmission,   if  such  notice  or
         communication  is  delivered  via  facsimile  at the  facsimile  number
         specified on the signature page attached hereto prior to 5:30 p.m. (New
         York City  time) on a Trading  Day and an  electronic  confirmation  of
         delivery is received by the sender, (ii) the next Trading Day after the
         date of transmission,  if such notice or communication is delivered via
         facsimile at the  facsimile  number  specified in this Section on a day
         that is not a Trading Day or later than 5:30 p.m.  (New York City time)
         on any Trading  Day,  (iii) three  Trading Days  following  the date of
         mailing,  if sent  by  U.S.  nationally  recognized  overnight  courier
         service,  or (iv) upon actual  receipt by the party to whom such notice
         is required to be given.

     Section 5.   Redemption.

                  (a) Optional Redemption at Election of Company. Subject to the
         provisions  of this  Section 5, the Company may deliver a notice to the
         Holders (an  "Optional  Redemption  Notice" and the date such notice is
         deemed delivered  hereunder,  the "Optional Redemption Notice Date") of
         its irrevocable  election to redeem some or all of the then outstanding
         Debentures,  for an amount,  in cash, equal to the Optional  Redemption
         Amount on the 20th Trading Day following the Optional Redemption Notice
         Date (such date, the "Optional  Redemption  Date" and such  redemption,
         the "Optional  Redemption").  The Optional  Redemption Amount is due in
         full on the Optional  Redemption  Date.  The Company may only effect an
         optional  redemption  if during the period  commencing  on the Optional
         Redemption  Notice Date through to the Optional  Redemption  Date,  (i)
         each of the Equity  Conditions shall have been met and (ii) the average
         daily trading  volume of the Common Stock exceeds 30,000 shares for any
         20  consecutive   Trading  Days  immediately   prior  to  the  Optional
         Redemption  Date.  If any of the Equity  Conditions  shall  cease to be
         satisfied at any time during the required  period,  then the Holder may
         elect to nullify the Optional Redemption Notice by notice to the

                                       15
<PAGE>

         Company  within 5  Trading  Days  after the first day on which any such
         Equity Condition has not been met, in which case the Option  Redemption
         Notice shall be null and void,  ab initio.  The Company  covenants  and
         agrees that it will honor all Conversion Notices tendered from the time
         of delivery of the Optional  Redemption Notice through the later of the
         Optional  Redemption Date or the date all amounts owing thereon are due
         and paid in full.

                  (b) Redemption  Procedure.  The payment of cash pursuant to an
         Optional  Redemption shall be made on the Optional  Redemption Date. If
         any portion of the cash payment for an Optional Redemption shall not be
         paid by the Company by the respective  due date,  interest shall accrue
         thereon at the rate of 12% per annum (or the maximum rate  permitted by
         applicable  law,  whichever  is less) until the payment of the Optional
         Redemption  Amount  plus all  amounts  owing  thereon  is paid in full.
         Alternatively, if any portion of the Optional Redemption Amount remains
         unpaid  after such date,  the Holders  subject to such  redemption  may
         elect,  by written notice to the Company given at any time  thereafter,
         to  invalidate  ab initio  such  redemption,  notwithstanding  anything
         herein  contained  to the  contrary,  and,  with respect the failure to
         honor an Optional  Redemption,  the Company shall have no further right
         to exercise such Optional Redemption Right. Notwithstanding anything to
         the contrary in this Section 5, the Company's  determination  to redeem
         in cash shall be applied among the Holders of  Debentures  according to
         each Holder's Pro-Rata Portion. As to any Holder, "Pro Rata Portion" is
         the  ratio of (x) the  principal  amount  of such  Holder's  Debentures
         outstanding on the Optional  Redemption  Notice Date and (y) the sum of
         the aggregate  principal  amounts of the Debentures  outstanding on the
         Optional Redemption Notice Date.

                  (c) Optional  Redemption  at Election of the Holder.  Upon the
         occurrence of a Holder Redemption Right (as defined below),  the Holder
         shall have the  right,  at the  Holder's  sole  election,  to demand (a
         "Redemption  Demand")  an  immediate  redemption  in cash  of the  full
         principal  amount of this  Debenture,  together with interest and other
         amounts  owing in respect  thereof.  If any portion of the cash payment
         for a  Redemption  Demand  shall not be paid by the  Company by the 5th
         Trading Day after a Redemption Demand, interest shall accrue thereon at
         the rate of 12% per annum (or the maximum rate  permitted by applicable
         law,  whichever is less) until such payment is made. All Debentures for
         which the  Redemption  Demand price  hereunder  shall have been paid in
         accordance  herewith shall promptly be surrendered to or as directed by
         the Company.  Such  Redemption  Demand may be rescinded and annulled by
         the Holder at any time prior to payment  hereunder and the Holder shall
         have all rights as a Debenture  holder until such time,  if any, as the
         full payment under this Section shall have been received by it. No such
         rescission or annulment shall affect any subsequent  Redemption  Demand
         or impair any right  consequent  thereon.  The  following  events shall
         constitute a "Holder Redemption Right":

                                       16
<PAGE>

                           (i) a  Registration  Statement  shall  not have  been
                  declared  effective by the Commission on or prior to the 210th
                  calendar day after the Original Issue Date;

                           (ii) if, during the Effectiveness  Period (as defined
                  in the Registration  Rights  Agreement),  the effectiveness of
                  the Registration Statement lapses for any reason or the Holder
                  shall not be permitted to resell  Registrable  Securities  (as
                  defined  in  the  Registration  Rights  Agreement)  under  the
                  Registration  Statement,  in  either  case,  for more  than 25
                  consecutive  Trading Days or 35  non-consecutive  Trading Days
                  during any 12 month  period;  provided,  however,  that in the
                  event that the Company is negotiating a merger, consolidation,
                  acquisition or sale of all or substantially  all of its assets
                  or a similar transaction and in the written opinion of counsel
                  to the Company, the Registration Statement,  would be required
                  to  be  amended  to  include   information   concerning   such
                  transactions  or the parties  thereto that is not available or
                  may not be publicly  disclosed at the time,  the Company shall
                  be permitted an additional 20 consecutive  Trading Days during
                  any 12 month period relating to such an event;

                           (iii) an Event (as defined in the Registration Rights
                  Agreement)  shall not have been cured to the  satisfaction  of
                  the Holder prior to the expiration of forty-five days from the
                  Event Date (as defined in the Registration  Rights  Agreement)
                  relating thereto;

                           (iv) the  Common  Stock  shall  not be  eligible  for
                  quotation  on a Trading  Market for five  consecutive  Trading
                  Days; or

                           (v) in the event of a Change of Control  Transaction,
                  or  the   Company   agrees  to  sell  or  dispose  of  all  or
                  substantially  all of its  assets in one or more  transactions
                  (whether or not such sale would constitute a Change of Control
                  Transaction).

     Section 6.  Definitions.  For the purposes hereof, in addition to the terms
defined elsewhere in this Debenture: (a) capitalized terms not otherwise defined
herein have the meanings given to such terms in the Purchase Agreement,  and (b)
the following terms shall have the following meanings:

                   "Change of Control  Transaction"  means the occurrence  after
         the date hereof of any of (i) an  acquisition  after the date hereof by
         an  individual  or  legal  entity  or  "group"  (as  described  in Rule
         13d-5(b)(1)  promulgated  under the Exchange Act) of effective  control
         (whether through legal or beneficial  ownership of capital stock of the
         Company,  by contract or  otherwise)  of in excess of 40% of the voting
         securities of the Company, other than by the Permitted Holders, or (ii)
         a  replacement  at one time or  within a one year  period  of more than
         one-half of the members of the Company's board of directors which

                                       17
<PAGE>

         is not approved by a majority of those  individuals  who are members of
         the board of directors on the date hereof (or by those  individuals who
         are  serving  as members  of the board of  directors  on any date whose
         nomination  to the board of directors was approved by a majority of the
         members of the board of directors  who are members on the date hereof),
         or (iii) the  execution  by the  Company of an  agreement  to which the
         Company  is a party or by which it is bound,  providing  for any of the
         events set forth above in (i) or (ii).

                  "Commission" means the Securities and Exchange Commission.

                  "Common  Stock" means the common  stock,  $0.001 par value per
         share,  of the  Company  and stock of any other  class  into which such
         shares may hereafter have been reclassified or changed.

                  "Conversion  Date" shall have the meaning set forth in Section
         4(a)(i) hereof.

                  "Equity  Conditions"  shall  mean  (i) the  Company  is not in
         default in honoring all conversions and redemptions  scheduled to occur
         or occurring by virtue of one or more Conversion  Notices, if any, (ii)
         all  liquidated  damages  and other  amounts  owing in  respect  of the
         Debentures   shall  have  been  paid;   (iii)  there  is  an  effective
         Registration  Statement  pursuant to which the Holder is  permitted  to
         utilize the prospectus  thereunder to resell all of the shares issuable
         pursuant to the  Transaction  Documents (and the Company  believes,  in
         good faith, that such effectiveness will continue uninterrupted for the
         foreseeable  future),  (iv) the Common  Stock is trading on the Trading
         Market  and all of the  shares  issuable  pursuant  to the  Transaction
         Documents  are listed for trading on a Trading  Market (and the Company
         believes,  in good faith, that trading of the Common Stock on a Trading
         Market will continue  uninterrupted  for the foreseeable  future),  (v)
         there is a sufficient  number of authorized  but unissued and otherwise
         unreserved shares of Common Stock for the issuance of all of the shares
         issuable  pursuant  to the  Transaction  Documents  (other  than shares
         issuable  in  lieu of  cash  interest  payments),  (vi)  there  is then
         existing no Event of Default or event  which,  with the passage of time
         or the giving of notice, would constitute an Event of Default and (vii)
         all of the  shares  issued  and  still  owned by a Holder  or  issuable
         pursuant to the  Transaction  Documents  to the extent  required by the
         Company  pursuant to the relevant  Section under this Debenture,  would
         not violate the limitations  set forth in Section  4(a)(ii) and (ix) no
         public announcement of a pending or proposed Fundamental Transaction or
         acquisition transaction has occurred that has not been consummated.

                  "Exchange Act" means the  Securities  Exchange Act of 1934, as
         amended.

                  "Interest Conversion Rate" means the lesser of (a) the average
         of the 20 VWAPs  immediately  prior to the applicable  Interest Payment
         Date or (b) the average of the 20

                                       18
<PAGE>

         VWAPs  immediately  prior to the date the applicable  interest  payment
         shares are issued and delivered if after the Interest Payment Date.

                  "Late  Fees"  shall have the  meaning  set forth in the second
         paragraph to this Debenture.

                  "Mandatory  Prepayment  Amount" for any Debentures shall equal
         the sum of (a) the greater of: (i) 105% of the principal  amount of the
         Debentures to be paid prior to January 31, 2005,  103% of the principal
         amount of the  Debentures to be paid prior to January 31, 2006 and 100%
         of the  principal  amount  of the  Debentures  to be  prepaid  plus all
         accrued and unpaid interest  thereon,  or (ii) the principal  amount of
         Debentures to be prepaid,  divided by the Set Price on (A) the date the
         Mandatory  Prepayment  Amount is demanded or  otherwise  due or (B) the
         date the  Mandatory  Prepayment  Amount is paid in full,  whichever  is
         less,  multiplied by the VWAP on (A) the date the Mandatory  Prepayment
         Amount  is  demanded  or  otherwise  due or (B) the date the  Mandatory
         Prepayment Amount is paid in full,  whichever is greater plus all other
         accrued and unpaid interest hereon,  and (b) all other amounts,  costs,
         expenses and liquidated damages due in respect of such Debentures.

                  "Optional  Redemption"  shall  have the  meaning  set forth in
         Section 5(a).

                  "Optional  Redemption Notice" shall have the meaning set forth
         in Section 5(a).

                  "Optional Redemption Amount" shall mean the sum of (i) 115% of
         the principal amount of the Debentures outstanding prior to January 31,
         2005, 110% of the principal amount of the Debentures  outstanding prior
         to January 31, 2006 and 105% of the principal  amount of the Debentures
         outstanding at all other times plus (ii) accrued but unpaid interest.

                  "Original  Issue  Date"  shall  mean  the  date  of the  first
         issuance of the Debentures regardless of the number of transfers of any
         Debenture  and  regardless  of the number of  instruments  which may be
         issued to evidence such Debenture.

                  "Permitted Holders" means Kwok Li, Felice Li, Linsang Partners
         LLC and their Affiliates, family members, and trusts for the benefit of
         the foregoing.

                  "Person"  means an  individual  or  corporation,  partnership,
         trust,  incorporated  or  unincorporated  association,  joint  venture,
         limited  liability  company,  joint stock  company,  government  (or an
         agency or subdivision thereof) or other entity of any kind.

                  "Purchase  Agreement" means the Securities Purchase Agreement,
         dated as of March 11,  2004,  to which  the  Company  and the  original
         Holder are parties,  as amended,  modified or supplemented from time to
         time in accordance with its terms.

                                       19
<PAGE>

                  "Registration  Rights Agreement" means the Registration Rights
         Agreement, dated as of the date of the Purchase Agreement, to which the
         Company and the original  Holder are parties,  as amended,  modified or
         supplemented from time to time in accordance with its terms.

                  "Registration   Statement"  means  a  registration   statement
         meeting the requirements set forth in the Registration Rights Agreement
         and covering among other things the resale of the Underlying  Shares by
         the Holder (as  provided  therein)  and naming the Holder as a "selling
         stockholder" thereunder.

                  "Securities Act" means the Securities Act of 1933, as amended,
         and the rules and regulations promulgated thereunder.

                  "Set  Price"  shall  have the  meaning  set  forth in  Section
         4(c)(i).

                  "Trading Day" shall have the meaning set forth in the Purchase
         Agreement.

                  "Transaction  Documents"  shall have the  meaning set forth in
         the Purchase Agreement.

                  "Underlying  Shares" means the shares of Common Stock issuable
         upon  conversion  of Debentures or as payment of interest in accordance
         with the terms hereof.

                  "VWAP"  shall  have the  meaning  set  forth  in the  Purchase
         Agreement.

      Section 7. Obligation Unconditional.  Except as expressly provided herein,
no  provision  of this  Debenture  shall alter or impair the  obligation  of the
Company, which is absolute and unconditional,  to pay the principal of, interest
and liquidated damages (if any) on, this Debenture at the time, place, and rate,
and in the coin or currency, herein prescribed.  This Debenture is a direct debt
obligation  of the Company and,  pursuant to the Custodial  Agreement  dated the
date hereof by and between the Company and the Purchasers (as defined  therein),
is secured by a first  priority  security  interest  in certain  Collateral  (as
defined therein).  This Debenture ranks pari passu with all other Debentures now
or hereafter issued under the terms set forth herein.

      Section 8. Replacement  Debentures.  If this Debenture shall be mutilated,
lost,  stolen or destroyed,  the Company shall execute and deliver,  in exchange
and substitution for and upon cancellation of a mutilated Debenture,  or in lieu
of or in substitution for a lost, stolen or destroyed Debenture, a new Debenture
for the  principal  amount  of this  Debenture  so  mutilated,  lost,  stolen or
destroyed but only upon receipt of evidence of such loss,  theft or  destruction
of such Debenture, and of the ownership hereof, and indemnity, if requested, all
reasonably satisfactory to the Company.

                                       20
<PAGE>

         Section 9. Limitation on Additional Liens on Secured Proceeds.  So long
as any portion of this Debenture is  outstanding,  the Company will not and will
not permit any of its  subsidiaries  to,  directly  or  indirectly,  enter into,
create,  incur,  assume or  suffer  to exist  any Liens of any kind,  on or with
respect to any of the Secured Proceeds (as that term is defined in the Custodial
Agreement).

      Section 10.  Governing  Law. All questions  concerning  the  construction,
validity,  enforcement and interpretation of this Debenture shall be governed by
and construed and enforced in accordance  with the internal laws of the State of
New York,  without  regard to the  principles of conflicts of law thereof.  Each
party  agrees  that  all  legal  proceedings   concerning  the  interpretations,
enforcement and defense of the  transactions  contemplated by this Debenture and
any of the Transaction  Documents (whether brought against a party hereto or its
respective affiliates,  directors, officers, shareholders,  employees or agents)
shall be commenced  exclusively  in the state and federal  courts sitting in the
City of New York,  borough  of  Manhattan  (the "New York  Courts").  Each party
hereby irrevocably submits to the exclusive  jurisdiction of the New York Courts
for the adjudication of any dispute hereunder or in connection  herewith or with
any transaction  contemplated hereby or discussed herein (including with respect
to the enforcement of any of the Transaction Documents),  and hereby irrevocably
waives,  and agrees not to assert in any suit,  action or proceeding,  any claim
that it is not personally subject to the jurisdiction of any such court, or that
the New York Courts are an improper or inconvenient  venue for such  proceeding.
Each party hereby irrevocably waives personal service of process and consents to
process  being served in any such suit,  action or  proceeding by mailing a copy
thereof via registered or certified mail or overnight delivery (with evidence of
delivery)  to such party at the  address in effect for  notices to it under this
Debenture  and agrees that such service  shall  constitute  good and  sufficient
service of process and notice thereof.  Nothing contained herein shall be deemed
to limit in any way any right to serve  process in any manner  permitted by law.
Each party hereto hereby irrevocably  waives, to the fullest extent permitted by
applicable  law,  any and all  right to trial  by jury in any  legal  proceeding
arising out of or relating to this  Debenture or the  transactions  contemplated
hereby.  If either party shall  commence an action or  proceeding to enforce any
provisions  of this  Debenture,  then the  prevailing  party in such  action  or
proceeding  shall be reimbursed by the other party for its  attorneys'  fees and
other  costs and  expenses  incurred  with the  investigation,  preparation  and
prosecution of such action or proceeding.

      Section 11. Waiver. Any waiver by the Company or the Holder of a breach of
any  provision  of this  Debenture  shall not operate as or be construed to be a
waiver  of any  other  breach of such  provision  or of any  breach of any other
provision of this Debenture.  The failure of the Company or the Holder to insist
upon strict  adherence to any term of this  Debenture  on one or more  occasions
shall not be  considered a waiver or deprive that party of the right  thereafter
to  insist  upon  strict  adherence  to  that  term  or any  other  term of this
Debenture. Any waiver must be in writing.

                                       21
<PAGE>

      Section 12.  Severability.  If any provision of this Debenture is invalid,
illegal or unenforceable,  the balance of this Debenture shall remain in effect,
and if any provision is  inapplicable  to any person or  circumstance,  it shall
nevertheless  remain  applicable to all other persons and  circumstances.  If it
shall be found that any interest or other amount  deemed  interest due hereunder
violates  applicable laws governing  usury,  the applicable rate of interest due
hereunder shall  automatically be lowered to equal the maximum permitted rate of
interest.  The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon,  plead, or in any manner  whatsoever claim
or take the benefit or advantage  of, any stay,  extension or usury law or other
law which would  prohibit or forgive the Company  from paying all or any portion
of the  principal  of or  interest on this  Debenture  as  contemplated  herein,
wherever enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this  indenture,  and the Company (to the extent
it may lawfully do so) hereby  expressly waives all benefits or advantage of any
such law,  and  covenants  that it will not, by resort to any such law,  hinder,
delay or impeded the  execution of any power herein  granted to the Holder,  but
will  suffer and permit  the  execution  of every such as though no such law has
been enacted.

      Section 13.  Payments  Due on  Non-Trading  Days.  Whenever any payment or
other obligation  hereunder shall be due on a day other than a Trading Day, such
payment shall be made on the next succeeding Trading Day.

                              *********************

                                       22
<PAGE>

         IN WITNESS WHEREOF,  the Company has caused this Convertible  Debenture
to be duly  executed  by a duly  authorized  officer as of the date first  above
indicated.

                                    LMIC, INC.

                                    By: /s/
                                        ----------------------------
                                        Name:  Luis P. Negrete
                                        Title: President & CEO

<PAGE>

                                     ANNEX A

                              NOTICE OF CONVERSION

The  undersigned  hereby elects to convert  principal  under the 4%  Convertible
Debenture of LMIC, Inc. (the "Company"),  due on September 11, 2006, into shares
of common stock, $.001 par value per share (the "Common Stock"),  of the Company
according to the conditions  hereof, as of the date written below. If shares are
to be issued in the name of a person other than the undersigned, the undersigned
will pay all  transfer  taxes  payable with  respect  thereto and is  delivering
herewith such  certificates and opinions as reasonably  requested by the Company
in  accordance  therewith.  No fee  will  be  charged  to  the  holder  for  any
conversion, except for such transfer taxes, if any.

By the delivery of this Notice of  Conversion  the  undersigned  represents  and
warrants to the Company that its  ownership of the  Company's  Common Stock does
not exceed the  amounts  determined  in  accordance  with  Section  13(d) of the
Exchange Act, specified under Section 4 of this Debenture.

The undersigned agrees to comply with the prospectus delivery requirements under
the applicable  securities laws in connection with any transfer of the aforesaid
shares of Common Stock.

Conversion calculations:

                                 Date to Effect Conversion:

                                 Principal Amount of Debentures to be Converted:

                                 Number of shares of Common Stock to be issued:

                                 Signature:

                                 Name:

                                 Address:

<PAGE>

                                   Schedule 1

                               CONVERSION SCHEDULE

4% Convertible  Debentures due on September 11, 2006, in the aggregate principal
amount of $5,000,000  issued by LMIC,  Inc. This  Conversion  Schedule  reflects
conversions made under Section 4 of the above referenced Debenture.

                                     Dated:

<TABLE>
<CAPTION>
=============================== ------------------------- ======================= ------------------------------
                                                           Aggregate Principal
                                                             Amount Remaining
      Date of Conversion                                      Subsequent to
(or for first entry, Original                                   Conversion
         Issue Date)              Amount of Conversion         (or original              Company Attest
                                                            Principal Amount)
------------------------------- ------------------------- ----------------------- ------------------------------
<S>                               <C>                      <C>                    <C>

------------------------------- ------------------------- ----------------------- ------------------------------

------------------------------- ------------------------- ----------------------- ------------------------------

------------------------------- ------------------------- ----------------------- ------------------------------

------------------------------- ------------------------- ----------------------- ------------------------------

------------------------------- ------------------------- ----------------------- ------------------------------

------------------------------- ------------------------- ----------------------- ------------------------------

------------------------------- ------------------------- ----------------------- ------------------------------

------------------------------- ------------------------- ----------------------- ------------------------------

=============================== ========================= ======================= ------------------------------
</TABLE>

                                       25

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