Document:

ex10-4.htm

     

    
      

      

    

    

      THE
        SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
        THE
        SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THE SECURITIES MAY
        NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
        STATEMENT FOR THE SECURITIES UNDER SAID ACT, OR AN OPINION OF COUNSEL IN
        FORM,
        SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS
        THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR UNLESS SOLD PURSUANT
        TO RULE
        144 OR REGULATION S UNDER SAID ACT.

       

      

       

      CALLABLE
        SECURED CONVERTIBLE NOTE

       

      Great
        Neck, NY

       

      December
        26, 2007 $1,300

       

      FOR
        VALUE RECEIVED, JUNIPER GROUP, INC., a Nevada
        corporation (hereinafter called the “Borrower”), hereby
        promises to pay to the order of New Millennium Capital Partners II, LLC or
        registered assigns (the “Holder”) the sum of $1,300, on
        December 26, 2010 (the “Maturity Date”), and to pay interest on
        the unpaid principal balance hereof at the rate of eight percent (8%) (the
        “Interest Rate”) per annum from December 26, 2007 (the
“Issue Date”) until the same becomes due and payable,
        whether
        at maturity or upon acceleration or by prepayment or otherwise.  Any
        amount of principal or interest on this Note which is not paid when due shall
        bear interest at the rate of fifteen percent (15%) per annum from the due
        date
        thereof until the same is paid (“Default
        Interest”).  Interest shall commence accruing on the Issue
        Date, shall be computed on the basis of a 365-day year and the actual number
        of
        days elapsed and shall be payable quarterly provided that no interest shall
        be
        due and payable for any month in which the Trading Price (as such term is
        defined below) is greater than $.0375 for each Trading Day (as such term
        is
        defined below) of the month. All payments due hereunder (to the extent not
        converted into common stock, $.001 par value per share (the “Common
        Stock”) in accordance with the terms hereof) shall be made in lawful
        money of the United States of America.  All payments shall be made at
        such address as the Holder shall hereafter give to the Borrower by written
        notice made in accordance with the provisions of this Note.  Whenever
        any amount expressed to be due by the terms of this Note is due on any day
        which
        is not a business day, the same shall instead be due on the next succeeding
        day
        which is a business day and, in the case of any interest payment date which
        is
        not the date on which this Note is paid in full, the extension of the due
        date
        thereof shall not be taken into account for purposes of determining the amount
        of interest due on such date.  As used in this Note, the term
“business day” shall mean any day other than a Saturday, Sunday or a day on
        which commercial banks in the city of New York, New York are authorized or
        required by law or executive order to remain closed.  Each capitalized
        term used herein, and not otherwise defined, shall have the meaning ascribed
        thereto in that certain Securities Purchase Agreement, dated December 26,
        2007,
        pursuant to which this Note was originally issued (the “Purchase
        Agreement”).

       

      This
        Note
        is free from all taxes, liens, claims and encumbrances with respect to the
        issue
        thereof and shall not be subject to preemptive rights or other similar rights
        of
        shareholders of the

       

      
        
           

        

        
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      Borrower
        and will not impose personal liability upon the holder thereof.  The
        obligations of the Borrower under this Note shall be secured by that certain
        Security Agreement and Intellectual Property Security Agreement, each dated
        December 26, 2007 by and between the Borrower and the Holder.

       

      The
        following terms shall apply to this Note:

       

       

      ARTICLE
        I. CONVERSION RIGHTS

       

      1.1           Conversion
        Right.  The Holder shall have the right
        from time to time, and at any time on or prior to the earlier of (i) the
        Maturity Date and (ii) the date of payment of the Default Amount (as defined
        in
        Article III) pursuant to Section 1.6(a) or Article III, the Optional Prepayment
        Amount (as defined in Section 5.1 or any payments pursuant to Section 1.7,
        each
        in respect of the remaining outstanding principal amount of this Note to
        convert
        all or any part of the outstanding and unpaid principal amount of this Note
        into
        fully paid and non-assessable shares of Common Stock, as such Common Stock
        exists on the Issue Date, or any shares of capital stock or other securities
        of
        the Borrower into which such Common Stock shall hereafter be changed or
        reclassified at the conversion price  (the “Conversion
        Price”) determined as provided herein (a
“Conversion”); provided, however, that in no
        event shall the Holder be entitled to convert any portion of this Note in
        excess
        of that portion of this Note upon conversion of which the sum of (1) the
        number
        of shares of Common Stock beneficially owned by the Holder and its affiliates
        (other than shares of Common Stock which may be deemed beneficially owned
        through the ownership of the unconverted portion of the Notes or the unexercised
        or unconverted portion of any other security of the Borrower (including,
        without
        limitation, the warrants issued by the Borrower pursuant to the Purchase
        Agreement) subject to a limitation on conversion or exercise analogous to
        the
        limitations contained herein) and (2) the number of shares of Common Stock
        issuable upon the conversion of the portion of this Note with respect to
        which
        the determination of this proviso is being made, would result in beneficial
        ownership by the Holder and its affiliates of more than 4.99% of the outstanding
        shares of Common Stock and providedfurther that the Holder shall
        not be entitled to convert any portion of this Note during any month immediately
        succeeding a Determination Date on which the Borrower exercises its prepayment
        option pursuant to Section 5.2 of this Note.  For purposes of the
        proviso to the immediately preceding sentence, beneficial ownership shall
        be
        determined in accordance with Section 13(d) of the Securities Exchange Act
        of
        1934, as amended, and Regulations 13D-G thereunder, except as otherwise provided
        in clause (1) of such proviso.  The number of shares of Common Stock
        to be issued upon each conversion of this Note shall be determined by dividing
        the Conversion Amount (as defined below) by the applicable Conversion Price
        then
        in effect on the date specified in the notice of conversion, in the form
        attached hereto as Exhibit A (the “Notice of Conversion”),
        delivered to the Borrower by the Holder in accordance with Section 1.4 below;
        provided that the Notice of Conversion is submitted by facsimile (or by other
        means resulting in, or reasonably expected to result in, notice) to the Borrower
        before 6:00 p.m., New York, New York time on such conversion date (the
“Conversion Date”).  The term “Conversion
        Amount” means, with respect to any conversion of this Note, the sum of
        (1) the principal amount of this Note to be converted in such conversion
        plus (2) at the Borrower’s option, accrued and unpaid interest, if any,
        on such principal amount at the interest rates provided in this Note to the
        Conversion Date, provided, however, that the Company shall have

       

      
        
           

        

        
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      the
        right
        to pay any or all interest in cash plus (3) at the Borrower’s option,
        Default Interest, if any, on the amounts referred to in the immediately
        preceding clauses (1) and/or (2) plus (4) at the Holder’s option, any
        amounts owed to the Holder pursuant to Sections 1.3 and 1.4(g) hereof or
        pursuant to Section 2(c) of that certain Registration Rights Agreement, dated
        as
        of December 26, 2007, executed in connection with the initial issuance of
        this
        Note and the other Notes issued on the Issue Date (the “Registration
        Rights Agreement”).  The term “Determination Date”
means the last business day of each month after
        the Issue
        Date.

       

      1.2           Conversion
        Price.

       

      (a)           Calculation
        of Conversion Price.  The Conversion
        Price shall be the lesser of (i) the Variable Conversion Price (as defined
        herein) and (ii) the Fixed Conversion Price (subject, in each case, to equitable
        adjustments for stock splits, stock dividends or rights offerings by the
        Borrower relating to the Borrower’s securities or the securities of any
        subsidiary of the Borrower, combinations, recapitalization, reclassifications,
        extraordinary distributions and similar events).  The
“Variable Conversion Price” shall mean the Applicable
        Percentage (as defined herein) multiplied by the Market Price (as defined
        herein).  “Market Price” means the average of the
        lowest three (3) Trading Prices (as defined below) for the Common Stock during
        the twenty (20) Trading Day period ending one Trading Day prior to the date
        the
        Conversion Notice is sent by the Holder to the Borrower via facsimile (the
        “Conversion Date”).  “Trading Price”
means, for any security as of any date,
        the intraday trading price on the
        Over-the-Counter Bulletin Board (the “OTCBB”) as reported by a
        reliable reporting service (“Reporting Service”) mutually
        acceptable to Borrower and Holder and hereafter designated by Holders of
        a
        majority in interest of the Notes and the Borrower or, if the OTCBB is not
        the
        principal trading market for such security, the intraday trading price of
        such
        security on the principal securities exchange or trading market where such
        security is listed or traded or, if no intraday trading price of such security
        is available in any of the foregoing manners, the average of the intraday
        trading prices of any market makers for such security that are listed in
        the
“pink sheets” by the National Quotation Bureau, Inc.  If the Trading
        Price cannot be calculated for such security on such date in the manner provided
        above, the Trading Price shall be the fair market value as mutually determined
        by the Borrower and the holders of a majority in interest of the Notes being
        converted for which the calculation of the Trading Price is required in order
        to
        determine the Conversion Price of such Notes.  “Trading
        Day” shall mean any day on which the Common Stock is traded for any
        period on the OTCBB, or on the principal securities exchange or other securities
        market on which the Common Stock is then being
        traded.  “Applicable Percentage” shall mean 35.0%.
        The “Fixed Conversion Price” shall mean $.05.

       

      (b)           Conversion
        Price During Major
        Announcements.  Notwithstanding anything
        contained in Section 1.2(a) to the contrary, in the event the Borrower (i)
        makes
        a public announcement that it intends to consolidate or merge with any other
        corporation (other than a merger in which the Borrower is the surviving or
        continuing corporation and its capital stock is unchanged) or sell or transfer
        all or substantially all of the assets of the Borrower or (ii) any person,
        group
        or entity (including the Borrower) publicly announces a tender offer to purchase
        50% or more of the Borrower’s Common Stock (or any other takeover scheme) (the
        date of the announcement referred to in clause (i) or (ii) is hereinafter
        referred to as the  “Announcement Date”), then the
        Conversion Price shall, effective upon the Announcement Date and continuing
        through the Adjusted Conversion Price

       

      
        
           

        

        
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      Termination
        Date (as defined below), be equal to the lower of (x) the Conversion Price
        which
        would have been applicable for a Conversion occurring on the Announcement
        Date
        and (y) the Conversion Price that would otherwise be in effect. From and
        after
        the Adjusted Conversion Price Termination Date, the Conversion Price shall
        be
        determined as set forth in this Section 1.2(a).  For purposes
        hereof,  “Adjusted Conversion Price Termination Date”
shall mean, with respect to any proposed transaction or
        tender offer (or
        takeover scheme) for which a public announcement as contemplated by this
        Section
        1.2(b) has been made, the date upon which the Borrower (in the case of clause
        (i) above) or the person, group or entity (in the case of clause (ii) above)
        consummates or publicly announces the termination or abandonment of the proposed
        transaction or tender offer (or takeover scheme) which caused this Section
        1.2(b) to become operative.

       

      1.3           Authorized
        Shares.  Subject to Stockholder Approval
        (as such term is defined in Section 4(k) of the Securities Purchase Agreement),
        the Borrower covenants that during the period the conversion right exists,
        the
        Borrower will reserve from its authorized and unissued Common Stock a sufficient
        number of shares, free from preemptive rights, to provide for the issuance
        of
        Common Stock upon the full conversion of this Note and the other Notes issued
        pursuant to the Purchase Agreement.  The Borrower is required at all
        times to have authorized and reserved two times the number of shares that
        is
        actually issuable upon full conversion of the Notes (based on the Conversion
        Price of the Notes or the Exercise Price of the Warrants in effect from time
        to
        time) (the “Reserved Amount”).  The Reserved Amount
        shall be increased from time to time in accordance with the Borrower’s
        obligations pursuant to Section 4(h) of the Purchase Agreement.  The
        Borrower represents that upon issuance, such shares will be duly and validly
        issued, fully paid and non-assessable.  In addition, if the Borrower
        shall issue any securities or make any change to its capital structure which
        would change the number of shares of Common Stock into which the Notes shall
        be
        convertible at the then current Conversion Price, the Borrower shall at the
        same
        time make proper provision so that thereafter there shall be a sufficient
        number
        of shares of Common Stock authorized and reserved, free from preemptive rights,
        for conversion of the outstanding Notes.  The Borrower (i)
        acknowledges that it has irrevocably instructed its transfer agent to issue
        certificates for the Common Stock issuable upon conversion of this Note,
        and
        (ii) agrees that its issuance of this Note shall constitute full authority
        to its officers and agents who are charged with the duty of executing stock
        certificates to execute and issue the necessary certificates for shares of
        Common Stock in accordance with the terms and conditions of this
        Note.

       

      If,
        at
        any time a Holder of this Note submits a Notice of Conversion, and the Borrower
        does not have sufficient authorized but unissued shares of Common Stock
        available to effect such conversion in accordance with the provisions of
        this
        Article I (a “Conversion Default”), subject to Section 4.8, the
        Borrower shall issue to the Holder all of the shares of Common Stock which
        are
        then available to effect such conversion.  The portion of this Note
        which the Holder included in its Conversion Notice and which exceeds the
        amount
        which is then convertible into available shares of Common Stock (the
“Excess Amount”) shall, notwithstanding anything to the
        contrary contained herein, not be convertible into Common Stock in accordance
        with the terms hereof until (and at the Holder’s option at any time after) the
        date additional shares of Common Stock are authorized by the Borrower to
        permit
        such conversion, at which time the Conversion Price in respect thereof shall
        be
        the lesser of (i) the Conversion Price on the Conversion Default Date (as
        defined below) and (ii) the Conversion

       

      
        
           

        

        
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      Price
        on
        the Conversion Date thereafter elected by the Holder in respect
        thereof.  In addition, the Borrower shall pay to the Holder payments
        (“Conversion Default Payments”) for a Conversion Default in the
        amount of (x) the sum of (1) the then outstanding principal amount of
        this Note plus (2) accrued and unpaid interest on the unpaid principal
        amount of this Note through the Authorization Date (as defined below)
plus (3) Default Interest, if any, on the amounts referred to in clauses
        (1) and/or (2), multiplied by (y) .24, multiplied by (z) (N/365),
        where N = the number of days from the day the holder submits a Notice of
        Conversion giving rise to a Conversion Default (the “Conversion Default
        Date”) to the date (the “Authorization Date”) that the
        Borrower authorizes a sufficient number of shares of Common Stock to effect
        conversion of the full outstanding principal balance of this
        Note.  The Borrower shall use its best efforts to authorize a
        sufficient number of shares of Common Stock as soon as practicable following
        the
        earlier of (i) such time that the Holder notifies the Borrower or that the
        Borrower otherwise becomes aware that there are or likely will be insufficient
        authorized and unissued shares to allow full conversion thereof and (ii)
        a
        Conversion Default.  The Borrower shall send notice to the Holder of
        the authorization of additional shares of Common Stock, the Authorization
        Date
        and the amount of Holder’s accrued Conversion Default Payments.  The
        accrued Conversion Default Payments for each calendar month shall be paid
        in
        cash or shall be convertible into Common Stock (at such time as there are
        sufficient authorized shares of Common Stock) at the applicable Conversion
        Price, at the Borrower’s option, as follows:

       

      (a)           In
        the event Holder elects to take such payment in cash, cash payment shall
        be made
        to Holder by the fifth (5th) day
        of the month
        following the month in which it has accrued; and

       

      (b)           In
        the event Holder elects to take such payment in Common Stock, the Holder
        may
        convert such payment amount into Common Stock at the Conversion Price (as
        in
        effect at the time of conversion) at any time after the fifth day of the
        month
        following the month in which it has accrued in accordance with the terms
        of this
        Article I (so long as there is then a sufficient number of authorized shares
        of
        Common Stock).

       

      The
        Holder’s election shall be made in writing to the Borrower at any time prior to
        6:00 p.m., New York, New York time, on the third day of the month following
        the
        month in which Conversion Default payments have accrued.  If no
        election is made, the Holder shall be deemed to have elected to receive
        cash.  Nothing herein shall limit the Holder’s right to pursue actual
        damages (to the extent in excess of the Conversion Default Payments) for
        the
        Borrower’s failure to maintain a sufficient number of authorized shares of
        Common Stock, and each holder shall have the right to pursue all remedies
        available at law or in equity (including degree of specific performance and/or
        injunctive relief).

       

      1.4           Method
        of Conversion.

       

      (a)           Mechanics
        of Conversion.  Subject to Section 1.1,
        this Note may be converted by the Holder in whole or in part at any time
        from
        time to time after the Issue Date, by (A) submitting to the Borrower a
        Notice of Conversion (by facsimile or other reasonable means of communication
        dispatched on the Conversion Date prior to 6:00 p.m., New York, New York
        time)
        and (B) subject to Section 1.4(b), surrendering this Note at the principal
        office of the Borrower.

       

      
        
           

        

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

       

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

       

      (d)           Delivery
        of Common Stock Upon Conversion.  Upon
        receipt by the Borrower from the Holder of a facsimile transmission (or other
        reasonable means of communication) of a Notice of Conversion meeting the
        requirements for conversion as provided in this Section 1.4, the Borrower
        shall
        issue and deliver or cause to be issued and delivered to or upon the order
        of
        the Holder certificates for the Common Stock issuable upon such conversion
        within three (3) business days after such receipt (and, solely in the case
        of
        conversion of the entire unpaid principal amount hereof, surrender of this
        Note)
        (such third business day being hereinafter referred to as the
“Deadline”) in accordance with the terms hereof and the
        Purchase Agreement (including, without limitation, in accordance with the
        requirements of Section 2(g) of the Purchase Agreement that certificates
        for
        shares of Common Stock issued on or after the effective date of the Registration
        Statement upon conversion of this Note shall not bear any restrictive
        legend).

       

      (e)           Obligation
        of Borrower to Deliver Common
        Stock.  Upon receipt by the Borrower of
        a Notice of Conversion, the Holder shall be deemed to be the holder of record
        of
        the Common Stock issuable upon such conversion, the outstanding principal
        amount
        and the amount of accrued and unpaid interest on this Note shall be reduced
        to
        reflect such conversion, and, unless the Borrower defaults on its obligations
        under this Article I, all rights with respect to the portion of this Note
        being
        so converted shall forthwith terminate except the

       

      
        
           

        

        
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      right
        to
        receive the Common Stock or other securities, cash or other assets, as herein
        provided, on such conversion.  If the Holder shall have given a Notice
        of Conversion as provided herein, the Borrower’s obligation to issue and deliver
        the certificates for Common Stock shall be absolute and unconditional,
        irrespective of the absence of any action by the Holder to enforce the same,
        any
        waiver or consent with respect to any provision thereof, the recovery of
        any
        judgment against any person or any action to enforce the same, any failure
        or
        delay in the enforcement of any other obligation of the Borrower to the holder
        of record, or any setoff, counterclaim, recoupment, limitation or termination,
        or any breach or alleged breach by the Holder of any obligation to the Borrower,
        and irrespective of any other circumstance which might otherwise limit such
        obligation of the Borrower to the Holder in connection with such
        conversion.  The Conversion Date specified in the Notice of Conversion
        shall be the Conversion Date so long as the Notice of Conversion is received
        by
        the Borrower before 6:00 p.m., New York, New York time, on such
        date.

       

      (f)           Delivery
        of Common Stock by Electronic
        Transfer.  In lieu of delivering
        physical certificates representing the Common Stock issuable upon conversion,
        provided the Borrower’s transfer agent is participating in the Depository Trust
        Company (“DTC”) Fast Automated Securities Transfer
        (“FAST”) program, upon request of the Holder and its compliance
        with the provisions contained in Section 1.1 and in this Section 1.4, the
        Borrower shall use its best efforts to cause its transfer agent to
        electronically transmit the Common Stock issuable upon conversion to the
        Holder
        by crediting the account of Holder’s Prime Broker with DTC through its Deposit
        Withdrawal Agent Commission (“DWAC”) system.

       

      (g)           Failure
        to Deliver Common Stock Prior to
        Deadline.  Without in any way limiting
        the Holder’s right to pursue other remedies, including actual damages and/or
        equitable relief, the parties agree that if delivery of the Common Stock
        issuable upon conversion of this Note is more than two (2) business days
        after
        the Deadline (other than a failure due to the circumstances described in
        Section
        1.3 above, which failure shall be governed by such Section) the Borrower
        shall
        pay to the Holder $2,000 per day in cash, for each day beyond the Deadline
        that
        the Borrower fails to deliver such Common Stock.  Such cash amount
        shall be paid to Holder by the fifth day of the month following the month
        in
        which it has accrued or, at the option of the Holder (by written notice to
        the
        Borrower by the first day of the month following the month in which it has
        accrued), shall be added to the principal amount of this Note, in which event
        interest shall accrue thereon in accordance with the terms of this Note and
        such
        additional principal amount shall be convertible into Common Stock in accordance
        with the terms of this Note.

       

      1.5           Concerning
        the Shares.  The shares of Common Stock
        issuable upon conversion of this Note may not be sold or transferred
        unless  (i) such shares are sold pursuant to an effective registration
        statement under the Act or (ii) the Borrower or its transfer agent shall
        have
        been furnished with an opinion of  counsel (which opinion shall be in
        form, substance and scope customary for opinions of counsel in comparable
        transactions) to the effect that the shares to be sold or transferred may
        be
        sold or transferred pursuant to an exemption from such registration or
        (iii) such shares are sold or transferred pursuant to Rule 144 under the
        Act (or a successor rule) (“Rule 144”) or (iv) such shares are
        transferred to an “affiliate” (as defined in Rule 144) of the Borrower who
        agrees to sell or otherwise transfer the shares only in accordance with this
        Section 1.5 and who is an Accredited Investor (as defined in the Purchase
        Agreement).

       

      
        
           

        

        
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      Except
        as
        otherwise provided in the Purchase Agreement (and subject to the removal
        provisions set forth below), until such time as the shares of Common Stock
        issuable upon conversion of this Note have been registered under the Act
        as
        contemplated by the Registration Rights Agreement or otherwise may be sold
        pursuant to Rule 144 without any restriction as to the number of securities
        as
        of a particular date that can then be immediately sold, each certificate
        for
        shares of Common Stock issuable upon conversion of this Note that has not
        been
        so included in an effective registration statement or that has not been sold
        pursuant to an effective registration statement or an exemption that permits
        removal of the legend, shall bear a legend substantially in the following
        form,
        as appropriate:

       

      “THE
        SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
        THE
        SECURITIES ACT OF 1933, AS AMENDED.  THE SECURITIES MAY NOT BE SOLD,
        TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
        FOR THE SECURITIES UNDER SAID ACT, OR AN OPINION OF COUNSEL IN FORM, SUBSTANCE
        AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT
        REGISTRATION IS NOT REQUIRED UNDER SAID ACT UNLESS SOLD PURSUANT TO RULE
        144 OR
        REGULATION S UNDER SAID ACT.”

       

      The
        legend set forth above shall be removed and the Borrower shall issue to the
        Holder a new certificate therefor free of any transfer legend if (i) the
        Borrower or its transfer agent shall have received an opinion of counsel,
        in
        form, substance and scope customary for opinions of counsel in comparable
        transactions, to the effect that a public sale or transfer of such Common
        Stock
        may be made without registration under the Act and the shares are so sold
        or
        transferred, (ii) such Holder provides the Borrower or its transfer agent
        with
        reasonable assurances that the Common Stock issuable upon conversion of this
        Note (to the extent such securities are deemed to have been acquired on the
        same
        date) can be sold pursuant to Rule 144 or (iii) in the case of the Common
        Stock
        issuable upon conversion of this Note, such security is registered for sale
        by
        the Holder under an effective registration statement filed under the Act
        or
        otherwise may be sold pursuant to Rule 144 without any restriction as to
        the
        number of securities as of a particular date that can then be immediately
        sold.  Nothing in this Note shall (i) limit the Borrower’s obligation
        under the Registration Rights Agreement or (ii) affect in any way the Holder’s
        obligations to comply with applicable prospectus delivery requirements upon
        the
        resale of the securities referred to herein.

       

      1.6           Effect
        of Certain Events.

       

      (a)           Effect
        of Merger, Consolidation, Etc.  At the
        option of the Holder, the sale, conveyance or disposition of all or
        substantially all of the assets of the Borrower, the effectuation by the
        Borrower of a transaction or series of related transactions in which more
        than
        50% of the voting power of the Borrower is disposed of, or the consolidation,
        merger or other business combination of the Borrower with or into any other
        Person (as defined below) or Persons when the Borrower is not the survivor
        shall
        either:  (i) be deemed to be an Event of Default (as defined in
        Article III) pursuant to which the Borrower shall be required to pay to the
        Holder upon the consummation of and as a condition to such transaction an
        amount
        equal to the Default Amount (as defined in Article III) or (ii) be treated
        pursuant to Section

       

      
        
           

        

        
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      1.6(b)
        hereof.  “Person” shall mean any individual,
        corporation, limited liability company, partnership, association, trust or
        other
        entity or organization.

       

      (b)           Adjustment
        Due to Merger, Consolidation, Etc.  If,
        at any time when this Note is issued and outstanding and prior to conversion
        of
        all of the Notes, there shall be any merger, consolidation, exchange of shares,
        recapitalization, reorganization, or other similar event, as a result of
        which
        shares of Common Stock of the Borrower shall be changed into the same or
        a
        different number of shares of another class or classes of stock or securities
        of
        the Borrower or another entity, or in case of any sale or conveyance of all
        or
        substantially all of the assets of the Borrower other than in connection
        with a
        plan of complete liquidation of the Borrower, then the Holder of this Note
        shall
        thereafter have the right to receive upon conversion of this Note, upon the
        basis and upon the terms and conditions specified herein and in lieu of the
        shares of Common Stock immediately theretofore issuable upon conversion,
        such
        stock, securities or assets which the Holder would have been entitled to
        receive
        in such transaction had this Note been converted in full immediately prior
        to
        such transaction (without regard to any limitations on conversion set forth
        herein), and in any such case appropriate provisions shall be made with respect
        to the rights and interests of the Holder of this Note to the end that the
        provisions hereof (including, without limitation, provisions for adjustment
        of
        the Conversion Price and of the number of shares issuable upon conversion
        of the
        Note) shall thereafter be applicable, as nearly as may be practicable in
        relation to any securities or assets thereafter deliverable upon the conversion
        hereof.  The Borrower shall not effect any transaction described in
        this Section 1.6(b) unless (a) it first gives, to the extent practicable,
        thirty
        (30) days prior written notice (but in any event at least fifteen (15) days
        prior written notice) of the record date of the special meeting of shareholders
        to approve, or if there is no such record date, the consummation of, such
        merger, consolidation, exchange of shares, recapitalization, reorganization
        or
        other similar event or sale of assets (during which time the Holder shall
        be
        entitled to convert this Note) and (b) the resulting successor or acquiring
        entity (if not the Borrower) assumes by written instrument the obligations
        of
        this Section 1.6(b).  The above provisions shall similarly apply to
        successive consolidations, mergers, sales, transfers or share
        exchanges.

       

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

       

      (d)           Adjustment
        Due to Dilutive Issuance.  If, at any
        time when any Notes are issued and outstanding, the Borrower issues or sells,
        or
        in accordance with this Section 1.6(d) hereof is deemed to have issued or
        sold,
        any shares of Common Stock for no consideration or for a consideration per
        share
        (before deduction of reasonable expenses or commissions or underwriting
        discounts or allowances in connection therewith) less than the Fixed
        Conversion

       

      
        
           

        

        
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            -

          
            

          

        

        
           

        

      

      Price
        in
        effect on the date of such issuance (or deemed issuance) of such shares of
        Common Stock (a “Dilutive Issuance”), then immediately upon the
        Dilutive Issuance, the Fixed Conversion Price will be reduced to the amount
        of
        the consideration per share received by the Borrower in such Dilutive Issuance;
        provided that only one adjustment will be made for each Dilutive
        Issuance. Notwithstanding anything contained in this Section 1.6 to the
        contrary, the Holder hereby acknowledges that the issuance of any shares
        of
        Common Stock in connection with any of the transactions set forth on Schedule
        A, attached hereto, shall not be deemed a Dilutive Issuance and accordingly
        there will be no reduction to  the Fixed Conversion
        Price.

       

      The
        Borrower shall be deemed to have issued or sold shares of Common Stock if
        the
        Borrower in any manner issues or grants any warrants, rights or options (not
        including employee stock option plans), whether or not immediately exercisable,
        to subscribe for or to purchase Common Stock or other securities convertible
        into or exchangeable for Common Stock (“Convertible
        Securities”) (such warrants, rights and options to purchase Common
        Stock or Convertible Securities are hereinafter referred to as
“Options”) and the price per share for which Common Stock is
        issuable upon the exercise of such Options is less than the Fixed Conversion
        Price then in effect, then the Fixed Conversion Price shall be equal to such
        price per share.  For purposes of the preceding sentence, the “price
        per share for which Common Stock is issuable upon the exercise of such Options”
is determined by dividing (i) the total amount, if any, received or receivable
        by the Borrower as consideration for the issuance or granting of all such
        Options, plus the minimum aggregate amount of additional consideration, if
        any,
        payable to the Borrower upon the exercise of all such Options, plus, in the
        case
        of Convertible Securities issuable upon the exercise of such Options, the
        minimum aggregate amount of additional consideration payable upon the conversion
        or exchange thereof at the time such Convertible Securities first become
        convertible or exchangeable, by (ii) the maximum total number of shares of
        Common Stock issuable upon the exercise of all such Options (assuming full
        conversion of Convertible Securities, if applicable).  No further
        adjustment to the Conversion Price will be made upon the actual issuance
        of such
        Common Stock upon the exercise of such Options or upon the conversion or
        exchange of Convertible Securities issuable upon exercise of such
        Options.

       

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

       

      
        
           

        

        
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            10
            -

          
            

          

        

        
           

        

      

      (e)           Purchase
        Rights.  If, at any time when any Notes
        are issued and outstanding, the Borrower issues any convertible securities
        or
        rights to purchase stock, warrants, securities or other property (the
“Purchase Rights”) pro rata to the record holders of any class
        of Common Stock, then the Holder of this Note will be entitled to acquire,
        upon
        the terms applicable to such Purchase Rights, the aggregate Purchase Rights
        which such Holder could have acquired if such Holder had held the number
        of
        shares of Common Stock acquirable upon complete conversion of this Note (without
        regard to any limitations on conversion contained herein) immediately before
        the
        date on which a record is taken for the grant, issuance or sale of such Purchase
        Rights or, if no such record is taken, the date as of which the record holders
        of Common Stock are to be determined for the grant, issue or sale of such
        Purchase Rights.

       

      (f)           Notice
        of Adjustments.  Upon the occurrence of
        each adjustment or readjustment of the Conversion Price as a result of the
        events described in this Section 1.6, the Borrower, at its expense, shall
        promptly compute such adjustment or readjustment and prepare and furnish
        to the
        Holder of a certificate setting forth such adjustment or readjustment and
        showing in detail the facts upon which such adjustment or readjustment is
        based.  The Borrower shall, upon the written request at any time of
        the Holder, furnish to such Holder a like certificate setting forth (i) such
        adjustment or readjustment, (ii) the Conversion Price at the time in effect
        and
        (iii) the number of shares of Common Stock and the amount, if any, of other
        securities or property which at the time would be received upon conversion
        of
        the Note.

       

      1.7           Trading
        Market Limitations. Unless permitted by the
        applicable rules and regulations of the principal securities market on which
        the
        Common Stock is then listed or traded, in no event shall the Borrower issue
        upon
        conversion of or otherwise pursuant to this Note and the other Notes issued
        pursuant to the Purchase Agreement more than the maximum number of shares
        of
        Common Stock that the Borrower can issue pursuant to any rule of the principal
        United States securities market on which the Common Stock is then traded
        (the
“Maximum Share Amount”), which shall be 19.99% of the total
        shares outstanding on the Closing Date (as defined in the Purchase Agreement),
        subject to equitable adjustment from time to time for stock splits, stock
        dividends, combinations, capital reorganizations and similar events relating
        to
        the Common Stock occurring after the date hereof.  Once the Maximum
        Share Amount has been issued (the date of which is hereinafter referred to
        as
        the “Maximum Conversion Date”), if the Borrower fails to
        eliminate any prohibitions under applicable law or the rules or regulations
        of
        any stock exchange, interdealer quotation system or other self-regulatory
        organization with jurisdiction over the Borrower or any of its securities
        on the
        Borrower’s ability to issue shares of Common Stock in excess of the Maximum
        Share Amount (a “Trading Market Prepayment Event”), in lieu of
        any further right to convert this Note, and in full satisfaction of the
        Borrower’s obligations under this Note, the Borrower shall pay to the Holder,
        within fifteen (15) business days of the Maximum Conversion Date (the
“Trading Market Prepayment Date”), an amount equal to 130%
times the sum of (a) the then outstanding principal
        amount of this
        Note immediately following the Maximum Conversion Date, plus (b) accrued
        and unpaid interest on the unpaid principal amount of this Note to the Trading
        Market Prepayment Date, plus (c) Default Interest, if any, on the amounts
        referred to in clause (a) and/or (b) above, plus (d) any optional amounts
        that may be added thereto at the Maximum Conversion Date by the Holder in
        accordance with the terms hereof (the then outstanding principal amount of
        this
        Note immediately following the Maximum Conversion Date, plus the amounts
        referred to in clauses (b), (c) and (d) above shall collectively be
        referred

       

      
        
           

        

        
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      to
        as the
“Remaining Convertible Amount”).  With respect to
        each Holder of Notes, the Maximum Share Amount shall refer to such Holder’s
prorata share thereof determined in accordance with Section 4.8
        below.  In the event that the sum of (x) the aggregate number of
        shares of Common Stock issued upon conversion of this Note and the other
        Notes
        issued pursuant to the Purchase Agreement plus (y) the aggregate number
        of shares of Common Stock that remain issuable upon conversion of this Note
        and
        the other Notes issued pursuant to the Purchase Agreement, represents at
        least
        one hundred percent (100%) of the Maximum Share Amount (the “Triggering
        Event”), the Borrower will use its best efforts to seek and obtain
        Shareholder Approval (or obtain such other relief as will allow conversions
        hereunder in excess of the Maximum Share Amount) as soon as practicable
        following the Triggering Event and before the Maximum Conversion
        Date.  As used herein, “Shareholder Approval” means
        approval by the shareholders of the Borrower to authorize the issuance of
        the
        full number of shares of Common Stock which would be issuable upon full
        conversion of the then outstanding Notes but for the Maximum Share
        Amount.

       

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

       

       

      ARTICLE
        II. CERTAIN COVENANTS

       

      2.1           Distributions
        on Capital Stock.  So long as the
        Borrower shall have any obligation under this Note, the Borrower shall not
        without the Holder’s written consent (a) pay, declare or set apart for such
        payment, any dividend or other distribution (whether in cash, property or
        other
        securities) on shares of capital stock other than dividends on shares of
        Common
        Stock solely in the form of additional shares of Common Stock or (b) directly
        or
        indirectly or through any subsidiary make any other payment or distribution
        in
        respect of its capital stock except for distributions pursuant to any
        shareholders’ rights plan which is approved by a majority of the Borrower’s
        disinterested directors.

       

      
        
           

        

        
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      2.2           Restriction
        on Stock Repurchases.  So long as the
        Borrower shall have any obligation under this Note, the Borrower shall not
        without the Holder’s written consent redeem, repurchase or otherwise acquire
        (whether for cash or in exchange for property or other securities or otherwise)
        in any one transaction or series of related transactions any shares of capital
        stock of the Borrower or any warrants, rights or options to purchase or acquire
        any such shares.

       

      2.3           Borrowings.  So
        long as the Borrower shall have any obligation under this Note, the Borrower
        shall not, without the Holder’s written consent, create, incur, assume or suffer
        to exist any liability for borrowed money, except (a) borrowings in existence
        or
        committed on the date hereof and of which the Borrower has informed Holder
        in
        writing prior to the date hereof, (b) indebtedness to trade creditors or
        financial institutions incurred in the ordinary course of business or (c)
        borrowings, the proceeds of which shall be used to repay this Note.

       

      2.4           Sale
        of Assets.  So long as the Borrower
        shall have any obligation under this Note, the Borrower shall not, without
        the
        Holder’s written consent, sell, lease or otherwise dispose of any significant
        portion of its assets outside the ordinary course of business.  Any
        consent to the disposition of any assets may be conditioned on a specified
        use
        of the proceeds of disposition.

       

      2.5           Advances
        and Loans.  So long as the Borrower
        shall have any obligation under this Note, the Borrower shall not, without
        the
        Holder’s written consent, lend money, give credit or make advances to any
        person, firm, joint venture or corporation, including, without limitation,
        officers, directors, employees, subsidiaries and affiliates of the Borrower,
        except loans, credits or advances (a) in existence or committed on the date
        hereof and which the Borrower has informed Holder in writing prior to the
        date
        hereof, (b) made in the ordinary course of business or (c) not in excess
        of
        $50,000.

       

      2.6           Contingent
        Liabilities.  So long as the Borrower
        shall have any obligation under this Note, the Borrower shall not, without
        the
        Holder’s written consent, which shall not be unreasonably withheld, assume,
        guarantee, endorse, contingently agree to purchase or otherwise become liable
        upon the obligation of any person, firm, partnership, joint venture or
        corporation, except by the endorsement of negotiable instruments for deposit
        or
        collection and except assumptions, guarantees, endorsements and contingencies
        (a) in existence or committed on the date hereof and which the Borrower has
        informed Holder in writing prior to the date hereof, and (b) similar
        transactions in the ordinary course of business.

       

       

      ARTICLE
        III. EVENTS OF DEFAULT

       

      If
        any of
        the following events of default (each, an “Event of Default”)
        shall occur:

       

      3.1           Failure
        to Pay Principal or Interest.  The
        Borrower fails to pay the principal hereof or interest thereon when due on
        this
        Note, whether at maturity, upon a Trading Market Prepayment Event pursuant
        to
        Section 1.7, upon acceleration or otherwise;

       

      
        
           

        

        
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      3.2           Conversion
        and the Shares.  The Borrower fails to
        issue shares of Common Stock to the Holder (or announces or threatens that
        it
        will not honor its obligation to do so) upon exercise by the Holder of the
        conversion rights of the Holder in accordance with the terms of this Note
        (for a
        period of at least sixty (60) days, if such failure is solely as a result
        of the
        circumstances governed by Section 1.3 and the Borrower is using its best
        efforts
        to authorize a sufficient number of shares of Common Stock as soon as
        practicable), fails to transfer or cause its transfer agent to transfer
        (electronically or in certificated form) any certificate for shares of Common
        Stock issued to the Holder upon conversion of or otherwise pursuant to this
        Note
        as and when required by this Note or the Registration Rights Agreement, or
        fails
        to remove any restrictive legend (or to withdraw any stop transfer instructions
        in respect thereof) on any certificate for any shares of Common Stock issued
        to
        the Holder upon conversion of or otherwise pursuant to this Note as and when
        required by this Note or the Registration Rights Agreement (or makes any
        announcement, statement or threat that it does not intend to honor the
        obligations described in this paragraph) and any such failure shall continue
        uncured (or any announcement, statement or threat not to honor its obligations
        shall not be rescinded in writing) for three (3) business days after the
        Borrower shall have been notified thereof in writing by the Holder;

       

      3.3           Failure
        to Timely File Registration or Effect
        Registration.  The Borrower fails to
        file the Registration Statement within forty-five (45) days following the
        Closing Date (as defined in the Purchase Agreement) or obtain effectiveness
        with
        the Securities and Exchange Commission of the Registration Statement within
        one
        hundred and twenty (120) days following the Closing Date (as defined in the
        Purchase Agreement) or such Registration Statement lapses in effect (or sales
        cannot otherwise be made thereunder effective, whether by reason of the
        Borrower’s failure to amend or supplement the prospectus included therein in
        accordance with the Registration Rights Agreement or otherwise) for more
        than
        ten (10) consecutive days or twenty (20) days in any twelve month period
        after
        the Registration Statement becomes effective;

       

      3.4           Breach
        of Covenants.  The Borrower breaches any
        material covenant or other material term or condition contained in Sections
        1.3,
        1.6 or 1.7 of this Note, or Sections 4(c), 4(e), 4(h), 4(i), 4(j) or 5 of
        the
        Purchase Agreement and such breach continues for a period of ten (10) days
        after
        written notice thereof to the Borrower from the Holder;

       

      3.5           Breach
        of Representations and Warranties.  Any
        representation or warranty of the Borrower made herein or in any agreement,
        statement or certificate given in writing pursuant hereto or in connection
        herewith (including, without limitation, the Purchase Agreement and the
        Registration Rights Agreement), shall be false or misleading in any material
        respect when made and the breach of which has (or with the passage of time
        will
        have) a material adverse effect on the rights of the Holder with respect
        to this
        Note, the Purchase Agreement or the Registration Rights Agreement;

       

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

       

      
        
           

        

        
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      3.7           Judgments.  Any
        money judgment, writ or similar process shall be entered or filed against
        the
        Borrower or any subsidiary of the Borrower or any of its property or other
        assets for more than $50,000, and shall remain unvacated, unbonded or unstayed
        for a period of twenty (20) days unless otherwise consented to by the Holder,
        which consent will not be unreasonably withheld;

       

      3.8           Bankruptcy.  Bankruptcy,
        insolvency, reorganization or liquidation proceedings or other proceedings
        for
        relief under any bankruptcy law or any law for the relief of debtors shall
        be
        instituted by or against the Borrower or any subsidiary of the Borrower,
        unless
        such proceeding shall be stayed within thirty (30) days;

       

      3.9           Delisting
        of Common Stock.  The Borrower shall
        fail to maintain the listing of the Common Stock on at least one of the OTCBB
        or
        an equivalent replacement exchange, the Nasdaq National Market, the Nasdaq
        SmallCap Market, the New York Stock Exchange, or the American Stock Exchange;
        or

       

      3.10           Default
        Under Other Notes.  An Event of Default
        has occurred and is continuing under any of the other Notes issued pursuant
        to
        the Purchase Agreement,

       

      then,
        upon the occurrence and during the continuation of any Event of Default
        specified in Section 3.1, 3.2, 3.3, 3.4, 3.5, 3.7, 3.9, or 3.10, at the option
        of the Holders of a majority of the aggregate principal amount of the
        outstanding Notes issued pursuant to the Purchase Agreement exercisable through
        the delivery of written notice to the Borrower by such Holders (the
“Default Notice”), and upon the occurrence of an Event of
        Default specified in Section 3.6 or 3.8 (unless, under Section 3.8, such
        proceeding shall be stayed within 30 days), the Notes shall become immediately
        due and payable and the Borrower shall pay to the Holder, in full satisfaction
        of its obligations hereunder, an amount equal to the greater of (i) 130%
        times the sum of (w) the then outstanding principal amount of this
        Note plus (x) accrued and unpaid interest on the unpaid principal amount
        of this Note to the date of payment (the “Mandatory Prepayment
        Date”) plus (y) Default Interest, if any, on the amounts
        referred to in clauses (w) and/or (x) plus (z) any amounts owed to the
        Holder pursuant to Sections 1.3 and 1.4(g) hereof or pursuant to Section
        2(c) of
        the Registration Rights Agreement (the then outstanding principal amount
        of this
        Note to the date of payment plus the amounts referred to in clauses (x),
        (y) and (z) shall collectively be known as the “Default Sum”)
        or (ii) the “parity value” of the Default Sum to be prepaid, where parity value
        means (a) the highest number of shares of Common Stock issuable upon conversion
        of or otherwise pursuant to such Default Sum in accordance with Article I,
        treating the Trading Day immediately preceding the Mandatory Prepayment Date
        as
        the “Conversion Date” for purposes of determining the lowest applicable
        Conversion Price, unless the Default Event arises as a result of a breach
        in
        respect of a specific Conversion Date in which case such Conversion Date
        shall
        be the Conversion Date), multiplied by (b) the highest Closing Price for
        the Common Stock during the period beginning on the date of first occurrence
        of
        the Event of Default and ending one day prior to the Mandatory Prepayment
        Date
        (the “Default Amount”) and all other amounts payable hereunder
        shall immediately become due and payable, all without demand, presentment
        or
        notice, all of which hereby are expressly waived, together with all costs,
        including, without limitation, legal fees and expenses, of collection, and
        the
        Holder shall be entitled to exercise all other rights and remedies available
        at
        law or in equity.  If the Borrower fails to pay the Default Amount
        within five (5) business days of written notice that such amount

       

      
        
           

        

        
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      is
        due
        and payable, then the Holder shall have the right at any time, so long as
        the
        Borrower remains in default (and so long and to the extent that there are
        sufficient authorized shares), to require the Borrower, upon written notice,
        to
        immediately issue, in lieu of the Default Amount, the number of shares of
        Common
        Stock of the Borrower equal to the Default Amount divided by the Conversion
        Price then in effect.

       

       

      ARTICLE
        IV. MISCELLANEOUS

       

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

       

      4.2           Notices.  Any
        notice herein required or permitted to be given shall be in writing and may
        be
        personally served or delivered by courier or sent by United States mail and
        shall be deemed to have been given upon receipt if personally served (which
        shall include telephone line facsimile transmission) or sent by courier or
        three
        (3) days after being deposited in the United States mail, certified, with
        postage pre-paid and properly addressed, if sent by mail.  For the
        purposes hereof, the address of the Holder shall be as shown on the records
        of
        the Borrower; and the address of the Borrower shall be 20283 State Road,
        Boca
        Raton, FL 33498, facsimile number: (561) 482-9328.  Both the Holder
        and the Borrower may change the address for service by service of written
        notice
        to the other as herein provided.

       

      4.3           Amendments.  This
        Note and any provision hereof may only be amended by an instrument in writing
        signed by the Borrower and the Holder.  The term “Note” and all
        reference thereto, as used throughout this instrument, shall mean this
        instrument (and the other Notes issued pursuant to the Purchase Agreement)
        as
        originally executed, or if later amended or supplemented, then as so amended
        or
        supplemented.

       

      4.4           Assignability.  This
        Note shall be binding upon the Borrower and its successors and assigns, and
        shall inure to be the benefit of the Holder and its successors and
        assigns.  Each transferee of this Note must be an “accredited
        investor” (as defined in Rule 501(a) of the 1933
        Act).  Notwithstanding anything in this Note to the contrary, this
        Note may be pledged as collateral in connection with a bonafide
        margin account or other lending arrangement.

       

      4.5           Cost
        of Collection.  If default is made in
        the payment of this Note, the Borrower shall pay the Holder hereof costs
        of
        collection, including reasonable attorneys’ fees.

       

      4.6           Governing
        Law.  THIS NOTE SHALL BE ENFORCED,
        GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
        YORK
        APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE,
        WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS.  THE BORROWER
        HEREBY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE UNITED STATES FEDERAL
        COURTS
        LOCATED IN NEW YORK, NEW YORK

       

      
        
           

        

        
          -
            16
            -

          
            

          

        

        
           

        

      

      WITH
        RESPECT TO ANY DISPUTE ARISING UNDER THIS NOTE, THE AGREEMENTS ENTERED INTO
        IN
        CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. BOTH
        PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE
        MAINTENANCE OF SUCH SUIT OR PROCEEDING.  BOTH PARTIES FURTHER AGREE
        THAT SERVICE OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE
        DEEMED
        IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH
        SUIT OR
        PROCEEDING.  NOTHING HEREIN SHALL AFFECT EITHER PARTY’S RIGHT TO SERVE
        PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.  BOTH PARTIES AGREE THAT
        A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE
        CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT
        OR IN ANY OTHER LAWFUL MANNER.  THE PARTY WHICH DOES NOT PREVAIL IN
        ANY DISPUTE ARISING UNDER THIS NOTE SHALL BE RESPONSIBLE FOR ALL FEES AND
        EXPENSES, INCLUDING ATTORNEYS’ FEES, INCURRED BY THE PREVAILING PARTY IN
        CONNECTION WITH SUCH DISPUTE.

       

      4.7           Certain
        Amounts.  Whenever pursuant to this Note
        the Borrower is required to pay an amount in excess of the outstanding principal
        amount (or the portion thereof required to be paid at that time) plus accrued
        and unpaid interest plus Default Interest on such interest, the Borrower
        and the
        Holder agree that the actual damages to the Holder from the receipt of cash
        payment on this Note may be difficult to determine and the amount to be so
        paid
        by the Borrower represents stipulated damages and not a penalty and is intended
        to compensate the Holder in part for loss of the opportunity to convert this
        Note and to earn a return from the sale of shares of Common Stock acquired
        upon
        conversion of this Note at a price in excess of the price paid for such shares
        pursuant to this Note.  The Borrower and the Holder hereby agree that
        such amount of stipulated damages is not plainly disproportionate to the
        possible loss to the Holder from the receipt of a cash payment without the
        opportunity to convert this Note into shares of Common Stock.

       

      4.8           Allocations
        of Maximum Share Amount and Reserved
        Amount.  The Maximum Share Amount and
        Reserved Amount shall be allocated pro rata among the Holders of Notes based
        on
        the principal amount of such Notes issued to each Holder.  Each
        increase to the Maximum Share Amount and Reserved Amount shall be allocated
        pro
        rata among the Holders of Notes based on the principal amount of such Notes
        held
        by each Holder at the time of the increase in the Maximum Share Amount or
        Reserved Amount.  In the event a Holder shall sell or otherwise
        transfer any of such Holder’s Notes, each transferee shall be allocated a pro
        rata portion of such transferor’s Maximum Share Amount and Reserved
        Amount.  Any portion of the Maximum Share Amount or Reserved Amount
        which remains allocated to any person or entity which does not hold any Notes
        shall be allocated to the remaining Holders of Notes, pro rata based on the
        principal amount of such Notes then held by such Holders.

       

      4.9           Damages
        Shares.  The shares of Common Stock that
        may be issuable to the Holder pursuant to Sections 1.3 and 1.4(g) hereof
        and
        pursuant to Section 2(c) of the Registration Rights Agreement (“Damages
        Shares”) shall be treated as Common Stock issuable upon conversion of
        this Note for all purposes hereof and shall be subject to all of the limitations
        and afforded all of the rights of the other shares of Common Stock issuable
        hereunder, including

       

      
        
           

        

        
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            17
            -

          
            

          

        

        
           

        

      

      without
        limitation, the right to be included in the Registration Statement filed
        pursuant to the Registration Rights Agreement.  For purposes of
        calculating interest payable on the outstanding principal amount hereof,
        except
        as otherwise provided herein, amounts convertible into Damages Shares
        (“Damages Amounts”) shall not bear interest but must be
        converted prior to the conversion of any outstanding principal amount hereof,
        until the outstanding Damages Amounts is zero.

       

      4.10           Denominations.  At
        the request of the Holder, upon surrender of this Note, the Borrower shall
        promptly issue new Notes in the aggregate outstanding principal amount hereof,
        in the form hereof, in such denominations of at least $50,000 as the Holder
        shall request.

       

      4.11           Purchase
        Agreement.  By its acceptance of this
        Note, each Holder agrees to be bound by the applicable terms of the Purchase
        Agreement.

       

      4.12           Notice
        of Corporate Events.  Except as
        otherwise provided below, the Holder of this Note shall have no rights as
        a
        Holder of Common Stock unless and only to the extent that it converts this
        Note
        into Common Stock.  The Borrower shall provide the Holder with prior
        notification of any meeting of the Borrower’s shareholders (and copies of proxy
        materials and other information sent to shareholders).  In the event
        of any taking by the Borrower of a record of its shareholders for the purpose
        of
        determining shareholders who are entitled to receive payment of any dividend
        or
        other distribution, any right to subscribe for, purchase or otherwise acquire
        (including by way of merger, consolidation, reclassification or
        recapitalization) any share of any class or any other securities or property,
        or
        to receive any other right, or for the purpose of determining shareholders
        who
        are entitled to vote in connection with any proposed sale, lease or conveyance
        of all or substantially all of the assets of the Borrower or any proposed
        liquidation, dissolution or winding up of the Borrower, the Borrower shall
        mail
        a notice to the Holder, at least twenty (20) days prior to the record date
        specified therein (or thirty (30) days prior to the consummation of the
        transaction or event, whichever is earlier), of the date on which any such
        record is to be taken for the purpose of such dividend, distribution, right
        or
        other event, and a brief statement regarding the amount and character of
        such
        dividend, distribution, right or other event to the extent known at such
        time.  The Borrower shall make a public announcement of any event
        requiring notification to the Holder hereunder substantially simultaneously
        with
        the notification to the Holder in accordance with the terms of this Section
        4.12.

       

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

       

      
        
           

        

        
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      ARTICLE
        V. CALL
        OPTION

       

      5.1           Call
        Option.  Notwithstanding anything to the
        contrary contained in this Article V, so long as (i) no Event of Default or
        Trading Market Prepayment Event shall have occurred and be continuing,
        (ii) the Borrower has a sufficient number of authorized shares of Common
        Stock reserved for issuance upon full conversion of the Notes, then at any
        time
        after the Issue Date, and (iii) the Common Stock is trading at or below
        $.15 per share, the Borrower shall have the right, exercisable on not less
        than
        ten (10) Trading Days prior written notice to the Holders of the Notes (which
        notice may not be sent to the Holders of the Notes until the Borrower is
        permitted to prepay the Notes pursuant to this Section 5.1), to prepay all
        of
        the outstanding Notes in accordance with this Section 5.1.  Any notice
        of prepayment hereunder (an “Optional Prepayment”) shall be
        delivered to the Holders of the Notes at their registered addresses appearing
        on
        the books and records of the Borrower and shall state (1) that the Borrower
        is
        exercising its right to prepay all of the Notes issued on the Issue Date
        and (2)
        the date of prepayment (the “Optional Prepayment
        Notice”).  On the date fixed for prepayment (the
“Optional Prepayment Date”), the Borrower shall make payment of
        the Optional Prepayment Amount (as defined below) to or upon the order of
        the
        Holders as specified by the Holders in writing to the Borrower at least one
        (1)
        business day prior to the Optional Prepayment Date.  If the Borrower
        exercises its right to prepay the Notes, the Borrower shall make payment
        to the
        holders of an amount in cash (the “Optional Prepayment Amount”)
        equal to either (i) 125% (for prepayments occurring within thirty (30) days
        of the Issue Date), (ii) 135% for prepayments occurring between thirty-one
        (31) and sixty  (60) days of the Issue Date, or (iii) 150% (for
        prepayments occurring after the sixtieth (60th) day
        following the
        Issue Date), multiplied by the sum of (w) the then outstanding principal
        amount
        of this Note plus (x) accrued and unpaid interest on the unpaid
        principal amount of this Note to the Optional Prepayment Date plus (y)
        Default Interest, if any, on the amounts referred to in clauses (w) and (x)
        plus (z) any amounts owed to the Holder pursuant to Sections 1.3 and
        1.4(g) hereof or pursuant to Section 2(c) of the Registration Rights Agreement
        (the then outstanding principal amount of this Note to the date of payment
        plus the amounts referred to in clauses (x), (y) and (z) shall
        collectively be known as the “Optional Prepayment Sum”).
        Notwithstanding notice of an Optional Prepayment, the Holders shall at all
        times
        prior to the Optional Prepayment Date maintain the right to convert all or
        any
        portion of the Notes in accordance with Article I and any portion of Notes
        so
        converted after receipt of an Optional Prepayment Notice and prior to the
        Optional Prepayment Date set forth in such notice and payment of the aggregate
        Optional Prepayment Amount shall be deducted from the principal amount of
        Notes
        which are otherwise subject to prepayment pursuant to such notice.  If
        the Borrower delivers an Optional Prepayment Notice and fails to pay the
        Optional Prepayment Amount due to the Holders of the Notes within two (2)
        business days following the Optional Prepayment Date, the Borrower shall
        forever
        forfeit its right to redeem the Notes pursuant to this Section 5.1.

       

      5.2           Partial
        Call Option.  Notwithstanding anything to the contrary
        contained in this Article V, in the event that the Average Daily Price of
        the
        Common Stock, as reported by the Reporting Service, for each day of the month
        ending on any Determination Date is below $.15 per share, the Borrower may,
        at
        its option, prepay a portion of the outstanding principal amount of the Notes
        equal to 104% of the principal amount hereof divided by thirty-six (36) plus
        one
        month’s interest.

       

      
        
           

        

        
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      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK]

       

      
        
           

        

        
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      IN
        WITNESS WHEREOF, Borrower has caused this Note to be signed in its name
        by its duly authorized officer this 26th day of
        December,
        2007.

       

      

      JUNIPER
        GROUP, INC.

      

      

      

      By:           ______________________________

      Vlado
        P. Hreljanovic

      Chief
        Executive Officer

      
        
           

        

        
          -
            21
            -

          
            

          

        

        
           

        

      

      EXHIBIT
        A

       

      NOTICE
        OF CONVERSION

       

      (To
        be
        Executed by the Registered Holder

       

      in
        order
        to Convert the Notes)

       

      The
        undersigned hereby irrevocably elects to convert $__________ principal amount
        of
        the Note (defined below) into shares of common stock, par value $.001 per
        share
        (“Common Stock”), of Juniper Group, Inc., a Nevada corporation
        (the “Borrower”) according to the conditions of the convertible
        Notes of the Borrower dated as of December 26, 2007 (the
“Notes”), as of the date written below.  If
        securities are to be issued in the name of a person other than the undersigned,
        the undersigned will pay all transfer taxes payable with respect thereto
        and is
        delivering herewith such certificates.  No fee will be charged to the
        Holder for any conversion, except for transfer taxes, if any.  A copy
        of each Note is attached hereto (or evidence of loss, theft or destruction
        thereof).

       

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

       

      Name
        of
        DTC Prime
        Broker:                                                                                                                     

      Account
        Number:                                                                                                                     

       

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

       

      Name:                                                                                                                     

      Address:                                                                                                                     

       

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

       

      Date
        of
        Conversion:___________________________

      Applicable
        Conversion Price:____________________

      Number
        of
        Shares of Common Stock to be Issued Pursuant to

      Conversion
        of the Notes:______________

      Signature:___________________________________

      Name:______________________________________

      Address:____________________________________

       

      
        
           

        

        
          -
            22
            -

          
            

          

        

        
           

        

      

      The
        Borrower shall issue and deliver shares of Common Stock to an overnight courier
        not later than three business days following receipt of the original Note(s)
        to
        be converted, and shall make payments pursuant to the Notes for the number
        of
        business days such issuance and delivery is late.

      
        
           

        

        
          -
            23
            -ex10-5.htm

     

    
      

      

    

    

      THIS
        WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE NOT
        BEEN
        REGIS­TERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  EXCEPT
        AS OTHERWISE SET FORTH HEREIN OR IN A SECURITIES PURCHASE AGREEMENT DATED
        AS OF
        DECEMBER 26, 2007, NEITHER THIS WARRANT NOR ANY OF SUCH SHARES MAY BE SOLD,
        TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRA­TION
        STATEMENT FOR SUCH SECURITIES UNDER SAID ACT OR, AN OPINION OF COUNSEL, IN
        FORM,
        SUBSTANCE AND SCOPE, CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE
        TRANSACTIONS, THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS
        SOLD
        PURSUANT TO RULE 144 OR REGULATION S UNDER SUCH ACT.

       

      Right
        to
        Purchase 934,000 Shares of Common Stock, par value $.001 per share

       

      STOCK
        PURCHASE WARRANT

       

      THIS
        CERTIFIES THAT, for value received, AJW Master Fund, Ltd. or its
        registered assigns, is entitled to purchase from Juniper Group,
        Inc., a Nevada corporation (the “Company”), at any time or from time to
        time during the period specified in Paragraph 2 hereof, 934,000 fully paid
        and nonassessable shares of the Company’s Common Stock, par value $.001 per
        share (the “Common Stock”), at an exercise price per share equal to $.005 (the
“Exercise Price”).  The term “Warrant Shares,” as used herein, refers
        to the shares of Common Stock purchasable hereunder.  The Warrant
        Shares and the Exercise Price are subject to adjustment as provided in Paragraph
        4 hereof.  The term “Warrants” means this Warrant and the other
        warrants issued pursuant to that certain Securities Purchase Agreement, dated
        December 26, 2007, by and among the Company and the Buyers listed on the
        execution page thereof (the “Securities Purchase Agreement”).

       

      This
        Warrant is subject to the following terms, provisions, and
        conditions:

       

      1.           Manner
        of Exercise; Issuance of Certificates; Payment for
        Shares.

       

      
        	
                Subject
                  to the provisions hereof, this Warrant may be exercised by the
                  holder
                  hereof, in whole or in part, by the surrender of this Warrant,
                  together
                  with a completed exercise agreement in the form attached hereto
                  (the
                  “Exercise Agreement”), to the Company during normal business hours on any
                  business day at the Company’s principal executive offices (or such other
                  office or agency of the Company as it may designate by notice to
                  the
                  holder hereof), and upon (i) payment to the Company in cash, by
                  certified
                  or offi­cial bank check or by wire transfer for the account of the
                  Company of the Exercise Price for the Warrant Shares specified
                  in the
                  Exercise Agreement or (ii) if the resale of the Warrant Shares
                  by the
                  holder is not then registered pursuant to an effective registration
                  statement under the Securities Act of 1933, as amended (the “Securities
                  Act”), delivery to the Company of a written notice of an election to
                  effect a “Cashless Exercise” (as defined in Section 11(c) below) for the
                  Warrant Shares specified in the Exercise
                  Agreement.

              

      

       

      
        
           

        

        
          -
            1
            -

          
            

          

        

        
           

        

      

      
        	
                The
                  Warrant Shares so purchased shall be deemed to be issued to the
                  holder
                  hereof or such holder’s designee, as the record owner of such shares, as
                  of the close of business on the date on which this Warrant shall
                  have been
                  surrendered, the completed Exercise Agreement shall have been
                  deliv­ered, and payment shall have been made for such shares as set
                  forth above.  Certifi­cates for the Warrant Shares so
                  purchased, representing the aggregate number of shares specified
                  in the
                  Exercise Agreement, shall be delivered to the holder hereof within
                  a
                  reasonable time, not exceeding five (5) business days, after this
                  Warrant
                  shall have been so exercised.  The certificates so delivered
                  shall be in such denominations as may be requested by the holder
                  hereof
                  and shall be registered in the name of such holder or such other
                  name as
                  shall be designated by such holder.  If this Warrant shall have
                  been exercised only in part, then, unless this Warrant has expired,
                  the
                  Company shall, at its expense, at the time of delivery of such
                  certificates, deliver to the holder a new Warrant representing
                  the number
                  of shares with respect to which this Warrant shall not then have
                  been
                  exercised.  In addition to all other available remedies at law
                  or in equity, if the Company fails to deliver certificates for
                  the Warrant
                  Shares within five (5) business days after this Warrant is exercised,
                  then
                  the Company shall pay to the holder in cash a penalty (the “Penalty”)
                  equal to 2% of the number of Warrant Shares that the holder is
                  entitled to
                  multiplied by the Market Price (as hereinafter defined) for each
                  day that
                  the Company fails to deliver certificates for the Warrant
                  Shares.  For example, if the holder is entitled to 100,000
                  Warrant Shares and the Market Price is $2.00, then the Company
                  shall pay
                  to the holder $4,000 for each day that the Company fails to deliver
                  certificates for the Warrant Shares.  The Penalty shall be paid
                  to the holder by the fifth day of the month following the month
                  in which
                  it has accrued.

              

      

       

      Notwithstanding
        anything in this Warrant to the contrary, in no event shall the holder of
        this
        Warrant be entitled to exercise a number of Warrants (or portions thereof)
        in
        excess of the number of Warrants (or portions thereof) upon exercise of which
        the sum of (i) the number of shares of Common Stock beneficially owned by
        the
        holder and its affiliates (other than shares of Common Stock which may be
        deemed
        beneficially owned through the ownership of the unexercised Warrants and
        the
        unexercised or unconverted portion of any other securities of the Company
        (including the Notes (as defined in the Securities Purchase Agreement)) subject
        to a limitation on conversion or exercise analogous to the limitation contained
        herein) and (ii) the number of shares of Common Stock issuable upon exercise
        of
        the Warrants (or portions thereof) with respect to which the determination
        described herein is being made, would result in beneficial ownership by the
        holder and its affiliates of more than 4.9% of the outstanding shares of
        Common
        Stock.  For purposes of the immediately preceding sentence, beneficial
        ownership shall be determined in accordance with Section 13(d) of the Securities
        Exchange Act of 1934, as amended, and Regulation 13D-G thereunder, except
        as
        otherwise provided in clause (i) of the preceding
        sentence.  Notwithstanding anything to the contrary contained herein,
        the limitation on exercise of this Warrant set forth herein may not be amended
        without (i) the written consent of the holder hereof and the Company and
        (ii)
        the approval of a majority of shareholders of the Company.

       

      2.           Period
        of Exercise.

       

      
        	
                  This
                  Warrant is exercisable at any time or from time to time on or after
                  the
                  date on which this Warrant is issued and delivered pursuant to
                  the terms
                  of the Securities Purchase Agreement and before 6:00 p.m., New
                  York, New
                  York time on the seventh (7th)
                  anniversary
                  of the date of issuance (the “Exercise
                  Period”).

              

      

       

      3.           Certain
        Agreements of the Company.

       

      
        	
                  The
                  Company hereby covenants and agrees as
                  follows:

              

      

       

      
        
           

        

        
          -
            2
            -

          
            

          

        

        
           

        

      

      
        	
                (a)

              	
                Shares
                  to be Fully Paid.  Subject to
                  Stockholder Approval (as such term is defined in the Securities
                  Purchase
                  Agreement), all Warrant Shares will, upon issuance in accordance
                  with the
                  terms of this Warrant, be validly issued, fully paid, and nonassessable
                  and free from all taxes, liens, and charges with respect to the
                  issue
                  thereof.

              

      

       

      (b)           Reservation
        of Shares.  Subject to Stockholder
        Approval (as such term is defined in the Securities Purchase Agreement),
        during
        the Exercise Period, the Company shall at all times have authorized, and
        reserved for the purpose of issuance upon exercise of this Warrant, a
        suf­ficient number of shares of Common Stock to provide for the exercise of
        this Warrant.

       

      (c)           Listing.  The
        Company shall promptly secure the listing of the shares of Common Stock issuable
        upon exercise of the Warrant upon each national securities exchange or automated
        quotation system, if any, upon which shares of Common Stock are then listed
        (subject to official notice of issuance upon exercise of this Warrant) and
        shall
        maintain, so long as any other shares of Common Stock shall be so listed,
        such
        listing of all shares of Common Stock from time to time issuable upon the
        exercise of this Warrant; and the Company shall so list on each national
        securities exchange or automated quotation system, as the case may be, and
        shall
        maintain such listing of, any other shares of capital stock of the Company
        issuable upon the exercise of this Warrant if and so long as any shares of
        the
        same class shall be listed on such national securities exchange or automated
        quotation system.

       

      (d)           Certain
        Actions Prohibited.  The Company will
        not, by amendment of its charter 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 to be observed or performed by it hereunder,
        but will at all times in good faith assist in the carrying out of all the
        provisions of this Warrant and in the taking of all such action as may
        reasonably be requested by the holder of this Warrant in order to protect
        the
        exercise privilege of the holder of this Warrant against dilu­tion or other
        impairment, consistent with the tenor and purpose of this
        Warrant.  Without limiting the general­ity of the foregoing, the
        Company (i) will not increase the par value of any shares of Common Stock
        receivable upon the exercise of this Warrant above the Exercise Price then
        in
        effect, and (ii) will take all such actions as may be necessary or appropriate
        in order that the Company may validly and legally issue fully paid and
        nonassessable shares of Common Stock upon the exercise of this
        Warrant.

       

      (e)           Successors
        and Assigns.  This Warrant will be
        binding upon any entity succeeding to the Company by merger, consolidation,
        or
        acquisition of all or sub­stantially all the Company’s assets.

       

      4.           Antidilution
        Provisions.

       

      During
        the Exercise Period, the Exercise Price and the number of Warrant Shares
        shall
        be subject to adjustment from time to time as provided in this Paragraph
        4.

       

      In
        the
        event that any adjustment of the Exercise Price as required herein results
        in a
        fraction of a cent, such Exercise Price shall be rounded up to the nearest
        cent.

       

      (a)           Adjustment
        of Exercise Price and Number of Shares upon Issuance of Common
        Stock.  Except as otherwise provided in
        Paragraphs 4(c) and 4(e) hereof, if and whenever on or after the date of
        issuance of this Warrant, the Company issues or sells, or in accordance with
        Paragraph 4(b) hereof is deemed to have issued or sold, any shares of
        Common

       

      
        
           

        

        
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      Stock
        for
        no consideration or for a consideration per share (before deduction of
        reasonable expenses or commissions or underwriting discounts or allowances
        in
        connection therewith) less than the Market Price on the date of issuance
        (a
“Dilutive Issuance”), then immediately upon the Dilutive Issuance, the Exercise
        Price will be reduced to a price determined by multiplying the Exercise Price
        in
        effect immediately prior to the Dilutive Issuance by a fraction, (i) the
        numerator of which is an amount equal to the sum of (x) the number of shares
        of
        Common Stock actually outstanding immediately prior to the Dilutive Issuance,
        plus (y) the quotient of the aggregate consideration, calculated as set forth
        in
        Paragraph 4(b) hereof, received by the Company upon such Dilutive Issuance
        divided by the Market Price in effect immediately prior to the Dilutive
        Issuance, and (ii) the denominator of which is the total number of shares
        of
        Common Stock Deemed Outstanding (as defined below) immediately after the
        Dilutive Issuance.  Notwithstanding anything contained in this Section
        4 to the contrary, the holder hereof hereby acknowledges that the issuance
        of
        any shares of Common Stock in connection with any of the transactions set
        forth
        on Schedule A, attached hereto, shall not be deemed a Dilutive Issuance
        and accordingly there will be no reduction to  the Exercise
        Price.

       

      (b)           Effect
        on Exercise Price of Certain
        Events.  For purposes of determining the
        adjusted Exercise Price under Paragraph 4(a) hereof, the following will be
        applicable:

       

      (i)           Issuance
        of Rights or Options.  If the Company in
        any manner issues or grants any warrants, rights or options, whether or not
        immediately exercisable, to subscribe for or to purchase Common Stock or
        other
        securities convertible into or exchangeable for Common Stock (“Convertible
        Securities”) (such warrants, rights and options to purchase Common Stock or
        Convertible Securities are hereinafter referred to as “Options”) and the price
        per share for which Common Stock is issuable upon the exercise of such Options
        is less than the Market Price on the date of issuance or grant of such Options,
        then the maximum total number of shares of Common Stock issuable upon the
        exercise of all such Options will, as of the date of the issuance or grant
        of
        such Options, be deemed to be outstanding and to have been issued and sold
        by
        the Company for such price per share.  For purposes of the preceding
        sentence, the “price per share for which Common Stock is issuable upon the
        exercise of such Options” is determined by dividing (i) the total amount, if
        any, received or receivable by the Company as consideration for the issuance
        or
        granting of all such Options, plus the minimum aggregate amount of additional
        consideration, if any, payable to the Company upon the exercise of all such
        Options, plus, in the case of Convertible Securities issuable upon the exercise
        of such Options, the minimum aggregate amount of additional consideration
        payable upon the conversion or exchange thereof at the time such Convertible
        Securities first become convertible or exchangeable, by (ii) the maximum
        total
        number of shares of Common Stock issuable upon the exercise of all such Options
        (assuming full conversion of Convertible Securities, if
        applicable).  No further adjustment to the Exercise Price will be made
        upon the actual issuance of such Common Stock upon the exercise of such Options
        or upon the conversion or exchange of Convertible Securities issuable upon
        exercise of such Options.

       

      (ii)           Issuance
        of Convertible Securities.  If the
        Company in any manner issues or sells any Convertible Securities, whether
        or not
        immediately convertible (other than where the same are issuable upon the
        exercise of Options) and the price per share for which Common Stock is issuable
        upon such conversion or exchange is less than the Market Price on the date
        of
        issuance, then the maximum total number of shares of Common Stock issuable
        upon
        the

       

      
        
           

        

        
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      conversion
        or exchange of all such Convertible Securities will, as of the date of the
        issuance of such Convertible Securities, be deemed to be outstanding and
        to have
        been issued and sold by the Company for such price per share.  For the
        purposes of the preceding sentence, the “price per share for which Common Stock
        is issuable upon such conversion or exchange” is determined by dividing (i) the
        total amount, if any, received or receivable by the Company as consideration
        for
        the issuance or sale of all such Convertible Securities, plus the minimum
        aggregate amount of additional consideration, if any, payable to the Company
        upon the conversion or exchange thereof at the time such Convertible Securities
        first become convertible or exchangeable, by (ii) the maximum total number
        of
        shares of Common Stock issuable upon the conversion or exchange of all such
        Convertible Securities.  No further adjustment to the Exercise Price
        will be made upon the actual issuance of such Common Stock upon conversion
        or
        exchange of such Convertible Securities.

       

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

       

      (iv)           Treatment
        of Expired Options and Unexercised Convertible
        Securities.  If, in any case, the total
        number of shares of Common Stock issuable upon exercise of any Option or
        upon
        conversion or exchange of any Convertible Securities is not, in fact, issued
        and
        the rights to exercise such Option or to convert or exchange such Convertible
        Securities shall have expired or terminated, the Exercise Price then in effect
        will be readjusted to the Exercise Price which would have been in effect
        at the
        time of such expiration or termination had such Option or Convertible
        Securities, to the extent outstanding immediately prior to such expiration
        or
        termination (other than in respect of the actual number of shares of Common
        Stock issued upon exercise or conversion thereof), never been
        issued.

       

      (v)           Calculation
        of Consideration Received.  If any
        Common Stock, Options or Convertible Securities are issued, granted or sold
        for
        cash, the consideration received therefor for purposes of this Warrant will
        be
        the amount received by the Company therefor, before deduction of reasonable
        commissions, underwriting discounts or allowances or other reasonable expenses
        paid or incurred by the Company in connection with such issuance, grant or
        sale.  In case any Common Stock, Options or Convertible Securities are
        issued or sold for a consideration part or all of which shall be other than
        cash, the amount of the consideration other than cash received by the Company
        will be the fair value of such consideration, except where such consideration
        consists of securities, in which case the amount of consideration received
        by
        the Company will be the Market Price thereof as of the date of
        receipt.  In case any Common Stock, Options or Convertible Securities
        are issued in connection with any acquisition, merger or consolidation in
        which
        the Company is the surviving corporation, the amount of consideration therefor
        will be deemed to be the fair value of such portion of the net assets and
        business of the non-surviving corporation as is attributable to such Common
        Stock, Options or Convertible

       

      
        
           

        

        
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      Securities,
        as the case may be.  The fair value of any consideration other than
        cash or securities will be determined in good faith by the Board of Directors
        of
        the Company.

       

      (vi)           Exceptions
        to Adjustment of Exercise Price.  No
        adjustment to the Exercise Price will be made (i) upon the exercise of any
        warrants, options or convertible securities granted, issued and outstanding
        on
        the date of issuance of this Warrant; (ii) upon the grant or exercise of
        any
        stock or options which may hereafter be granted or exercised under any employee
        benefit plan, stock option plan or restricted stock plan of the Company now
        existing or to be implemented in the future, so long as the issuance of such
        stock or options is approved by a majority of the independent members of
        the
        Board of Directors of the Company or a majority of the members of a committee
        of
        independent directors established for such purpose; or (iii) upon the exercise
        of the Warrants.

       

      (c)           Subdivision
        or Combination of Common Stock.  If the
        Company at any time subdivides (by any stock split, stock dividend,
        recapitalization, reorganization, reclassification or otherwise) the shares
        of
        Common Stock acquirable hereunder into a greater number of shares, then,
        after
        the date of record for effecting such subdivision, the Exercise Price in
        effect
        immediately prior to such subdivision will be proportionately
        reduced.  If the Company at any time combines (by reverse stock split,
        recapitalization, reorganization, reclassification or otherwise) the shares
        of
        Common Stock acquirable hereunder into a smaller number of shares, then,
        after
        the date of record for effecting such combination, the Exercise Price in
        effect
        immediately prior to such combination will be proportionately
        increased.

       

      (d)           Adjustment
        in Number of Shares.  Upon each
        adjustment of the Exercise Price pursuant to the provisions of this Paragraph
        4,
        the number of shares of Common Stock issuable upon exercise of this Warrant
        shall be adjusted by multiplying a number equal to the Exercise Price in
        effect
        immediately prior to such adjustment by the number of shares of Common Stock
        issuable upon exercise of this Warrant immediately prior to such adjustment
        and
        dividing the product so obtained by the adjusted Exercise Price.

       

      (e)           Consolidation,
        Merger or Sale.  In case of any
        consolidation of the Company with, or merger of the Company into any other
        corporation, or in case of any sale or conveyance of all or substantially
        all of
        the assets of the Company other than in connection with a plan of complete
        liquidation of the Company, then as a condition of such consolidation, merger
        or
        sale or conveyance, adequate provision will be made whereby the holder of
        this
        Warrant will have the right to acquire and receive upon exercise of this
        Warrant
        in lieu of the shares of Common Stock immediately theretofore acquirable
        upon
        the exercise of this Warrant, such shares of stock, securities or assets
        as may
        be issued or payable with respect to or in exchange for the number of shares
        of
        Common Stock immediately theretofore acquirable and receivable upon exercise
        of
        this Warrant had such consolidation, merger or sale or conveyance not taken
        place.  In any such case, the Company will make appropriate provision
        to insure that the provisions of this Paragraph 4 hereof will thereafter
        be
        applicable as nearly as may be in relation to any shares of stock or securities
        thereafter deliverable upon the exercise of this Warrant.  The Company
        will not effect any consolidation, merger or sale or conveyance unless prior
        to
        the consummation thereof, the successor corporation (if other than the Company)
        assumes by written instrument the obligations under this Paragraph 4 and
        the
        obligations to deliver to the holder of

       

      
        
           

        

        
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      this
        Warrant such shares of stock, securities or assets as, in accordance with
        the
        foregoing provisions, the holder may be entitled to acquire.

       

      (f)           Distribution
        of Assets.  In case the Company shall
        declare or make any distribution of its assets (including cash) to holders
        of
        Common Stock as a partial liquidating dividend, by way of return of capital
        or
        otherwise, then, after the date of record for determining shareholders entitled
        to such distribution, but prior to the date of distribution, the holder of
        this
        Warrant shall be entitled upon exercise of this Warrant for the purchase
        of any
        or all of the shares of Common Stock subject hereto, to receive the amount
        of
        such assets which would have been payable to the holder had such holder been
        the
        holder of such shares of Common Stock on the record date for the determination
        of shareholders entitled to such distribution.

       

      (g)           Notice
        of Adjustment.  Upon the occurrence of
        any event which requires any adjustment of the Exercise Price, then, and
        in each
        such case, the Company shall give notice thereof to the holder of this Warrant,
        which notice shall state the Exercise Price resulting from such adjustment
        and
        the increase or decrease in the number of Warrant Shares purchasable at such
        price upon exercise, setting forth in reasonable detail the method of
        calculation and the facts upon which such calculation is based.  Such
        calculation shall be certified by the Chief Financial Officer of the
        Company.

       

      (h)           Minimum
        Adjustment of Exercise Price.  No
        adjustment of the Exercise Price shall be made in an amount of less than
        1% of
        the Exercise Price in effect at the time such adjustment is otherwise required
        to be made, but any such lesser adjustment shall be carried forward and shall
        be
        made at the time and together with the next subsequent adjustment which,
        together with any adjustments so carried forward, shall amount to not less
        than
        1% of such Exercise Price.

       

      (i)           No
        Fractional Shares.  No fractional shares
        of Common Stock are to be issued upon the exercise of this Warrant, but the
        Company shall pay a cash adjustment in respect of any fractional share which
        would otherwise be issuable in an amount equal to the same fraction of the
        Market Price of a share of Common Stock on the date of such
        exercise.

       

      (j)           Other
        Notices.  In case at any
        time:

       

      (i)           the
        Company shall declare any dividend upon the Common Stock payable in shares
        of
        stock of any class or make any other distribution (including dividends or
        distributions payable in cash out of retained earnings) to the holders of
        the
        Common Stock;

       

      (ii)           the
        Company shall offer for subscription pro rata to the holders of the Common
        Stock
        any additional shares of stock of any class or other rights;

       

      (iii)           there
        shall be any capital reorganiza­tion of the Company, or reclassification of
        the Common Stock, or consolidation or merger of the Company with or into,
        or
        sale of all or substan­tially all its assets to, another corporation or
        entity; or

       

      (iv)           there
        shall be a voluntary or involun­tary dissolution, liquidation or winding up
        of the Company;

       

      
        
           

        

        
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      then,
        in
        each such case, the Company shall give to the holder of this Warrant (a)
        notice
        of the date on which the books of the Company shall close or a record shall
        be
        taken for determining the holders of Common Stock entitled to receive any
        such
        divi­dend, distribution, or subscription rights or for determining the
        holders of Common Stock entitled to vote in respect of any such reorganization,
        reclassification, consolidation, merger, sale, dissolution, liquidation or
        winding-up and (b) in the case of any such reorganization, reclassification,
        consolidation, merger, sale, dissolution, liquidation or winding-up, notice
        of
        the date (or, if not then known, a reasonable approximation thereof by the
        Company) when the same shall take place.  Such notice shall also
        specify the date on which the holders of Common Stock shall be entitled to
        receive such dividend, distribution, or subscription rights or to exchange
        their
        Common Stock for stock or other securities or property deliverable upon such
        reorganization, re­classification, consolidation, merger, sale, dissolution,
        liquidation, or winding-up, as the case may be.  Such notice shall be
        given at least 30 days prior to the record date or the date on which the
        Company’s books are closed in respect thereto.  Failure to give any
        such notice or any defect therein shall not affect the validity of the
        proceedings referred to in clauses (i), (ii), (iii) and (iv) above.

       

      (k)           Certain
        Events.  If any event occurs of the type
        contemplated by the adjustment provisions of this Paragraph 4 but not expressly
        provided for by such provisions, the Company will give notice of such event
        as
        provided in Paragraph 4(g) hereof, and the Company’s Board of Directors will
        make an appropriate adjustment in the Exercise Price and the number of shares
        of
        Common Stock acquirable upon exercise of this Warrant so that the rights
        of the
        holder shall be neither enhanced nor diminished by such event.

       

      (l)           Certain
        Definitions.

       

      (i)           “Common
        Stock Deemed Outstanding” shall mean the number of
        shares of Common Stock actually outstanding (not including shares of Common
        Stock held in the treasury of the Company), plus (x) pursuant to Paragraph
        4(b)(i) hereof, the maximum total number of shares of Common Stock issuable
        upon
        the exercise of Options, as of the date of such issuance or grant of such
        Options, if any, and (y) pursuant to Paragraph 4(b)(ii) hereof, the maximum
        total number of shares of Common Stock issuable upon conversion or exchange
        of
        Convertible Securities, as of the date of issuance of such Convertible
        Securities, if any.

       

      (ii)           “Market
        Price,” as of any date, (i) means the average of
        the last reported sale prices for the shares of Common Stock on the OTCBB
        for
        the five (5) Trading Days immediately preceding such date as reported by
        Bloomberg, or (ii) if the OTCBB is not the principal trading market for the
        shares of Common Stock, the average of the last reported sale prices on the
        principal trading market for the Common Stock during the same period as reported
        by Bloomberg, or (iii) if market value cannot be calculated as of such date
        on
        any of the foregoing bases, the Market Price shall be the fair market value
        as
        reasonably determined in good faith by (a) the Board of Directors of the
        Company
        or, at the option of a majority-in-interest of the holders of the outstanding
        Warrants by (b) an independent investment bank of nationally recognized standing
        in the valuation of businesses similar to the business of the corporation.
        The
        manner of determining the Market Price of the Common Stock set forth in the
        foregoing definition shall apply with respect to any other security in respect
        of which a determination as to market value must be made hereunder.

       

      
        
           

        

        
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      (iii)           “Common
        Stock,” for purposes of this Paragraph 4, includes
        the Common Stock, par value $.001 per share, and any additional class of
        stock
        of the Company having no preference as to dividends or distributions on
        liquidation, provided that the shares purchasable pursuant to this Warrant
        shall
        include only shares of Common Stock, par value $.001 per share, in respect
        of
        which this Warrant is exercisable, or shares resulting from any subdivision
        or
        combination of such Common Stock, or in the case of any reorganization,
        reclassification, consolidation, merger, or sale of the character referred
        to in
        Paragraph 4(e) hereof, the stock or other securities or property provided
        for in
        such Paragraph.

       

      5.           Issue
        Tax.

       

      
        	
                  The
                  issuance of certificates for Warrant Shares upon the exercise of
                  this
                    Warrant shall be made without charge to the holder of this Warrant
                  or such
                  shares for any issuance tax or other costs in respect thereof,
                  provided
                  that the Company shall not be required to pay any tax which may
                  be payable
                  in respect of any transfer involved in the issuance and delivery
                  of any
                  certificate in a name other than the holder of this
                  Warrant.

              

      

       

      6.           No
        Rights or Liabilities as a Shareholder.

       

      
        	
                  This
                  Warrant shall not entitle the holder hereof to any voting rights
                  or other
                  rights as a shareholder of the Company.  No provision of this
                  Warrant, in the absence of affirmative action by the holder hereof
                  to
                  purchase Warrant Shares, and no mere enumeration herein of the
                  rights or
                  privileges of the holder hereof, shall give rise to any liability
                  of such
                  holder for the Exercise Price or as a shareholder of the Company,
                  whether
                  such liability is asserted by the Company or by creditors of the
                  Company.

              

      

       

      7.           Transfer,
        Exchange, and Replacement of Warrant.

       

      (a)           Restriction
        on Transfer.  This Warrant and the
        rights granted to the holder hereof are transferable, in whole or in part,
        upon
        surrender of this Warrant, together with a properly executed assignment in
        the
        form attached hereto, at the office or agency of the Company referred to
        in
        Paragraph 7(e) below, pro­vided, however, that any transfer or
        assignment shall be subject to the conditions set forth in Paragraph 7(f)
        hereof
        and to the applicable provisions of the Securities Purchase
        Agreement.  Until due presentment for registration of transfer on the
        books of the Company, the Company may treat the registered holder hereof
        as the
        owner and holder hereof for all purposes, and the Company shall not be affected
        by any notice to the con­trary.  Notwithstanding anything to the
        contrary contained herein, the registration rights described in Paragraph
        8 are
        assignable only in accordance with the provisions of that certain Registration
        Rights Agreement, dated December 26, 2007, by and among the Company and the
        other signatories thereto (the “Registration Rights Agreement”).

       

      (b)           Warrant
        Exchangeable for Different
        Denomina­tions.  This Warrant is
        exchange­able, upon the surrender hereof by the holder hereof at the office
        or agency of the Company referred to in Paragraph 7(e) below, for new Warrants
        of like tenor representing in the aggregate the right to purchase the number
        of
        shares of Common Stock which may be purchased hereunder, each of such new
        Warrants to represent the right to purchase such number of shares as shall
        be
        designated by the holder hereof at the time of such surrender.

       

      (c)           Replacement
        of Warrant.  Upon receipt of
        evi­dence reasonably satisfactory to the Company of the loss, theft,
        destruction, or mutilation of this Warrant and, in the case of any such loss,
        theft, or destruc­tion, upon delivery of an indemnity agreement
        reason­ably satisfactory in form and amount to the Company, or, in the case
        of any such mutilation,

       

      
        
           

        

        
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      upon
        surrender and cancellation of this Warrant, the Company, at its expense,
        will
        execute and deliver, in lieu thereof, a new Warrant of like tenor.

       

      (d)           Cancellation;
        Payment of Expenses.  Upon the surrender
        of this Warrant in connection with any trans­fer, exchange, or replacement
        as provided in this Paragraph 7, this Warrant shall be promptly canceled
        by the
        Company.  The Company shall pay all taxes (other than securities
        transfer taxes) and all other expenses (other than legal expenses, if any,
        incurred by the holder or transferees) and charges payable in connection
        with
        the preparation, execution, and delivery of Warrants pursuant to this Paragraph
        7.

       

      (e)           Register.  The
        Company shall maintain, at its principal executive offices (or such other
        office
        or agency of the Company as it may designate by notice to the holder hereof),
        a
        register for this Warrant, in which the Company shall record the name and
        address of the person in whose name this Warrant has been issued, as well
        as the
        name and address of each transferee and each prior owner of this
        Warrant.

       

      (f)           Exercise
        or Transfer Without Registration.  If,
        at the time of the surrender of this Warrant in connection with any exercise,
        transfer, or exchange of this Warrant, this Warrant (or, in the case of any
        exercise, the Warrant Shares issuable hereunder), shall not be registered
        under
        the Securities Act of 1933, as amended (the “Securities Act”) and under
        applicable state securities or blue sky laws, the Company may require, as
        a
        condition of allowing such exercise, transfer, or exchange, (i) that the
        holder
        or transferee of this Warrant, as the case may be, furnish to the Company
        a
        written opinion of counsel, which opinion and counsel are acceptable to the
        Company, to the effect that such exercise, transfer, or exchange may be made
        without registration under said Act and under applicable state securities
        or
        blue sky laws, (ii) that the holder or transferee execute and deliver to
        the
        Company an investment letter in form and substance acceptable to the Company
        and
        (iii) that the transferee be an “accredited investor” as defined in Rule 501(a)
        promulgated under the Securities Act; provided that no such opinion, letter
        or
        status as an “accredited investor” shall be required in connection with a
        transfer pursuant to Rule 144 under the Securities Act.  The first
        holder of this Warrant, by taking and holding the same, represents to the
        Company that such holder is acquiring this Warrant for investment and not
        with a
        view to the distribution thereof.

       

      8.           Registration
        Rights.

       

      
        	
                The
                  initial holder of this Warrant (and certain assignees thereof)
                  is entitled
                  to the benefit of such registration rights in respect of the Warrant
                  Shares as are set forth in Section 2 of the Registration Rights
                  Agreement.

              

      

       

      9.           Notices.

       

      
        	
                  All
                  notices, requests, and other communications required or permitted
                  to be
                  given or delivered hereunder to the holder of this Warrant shall
                  be in
                  writing, and shall be personally delivered, or shall be sent by
                  certified
                  or registered mail or by recognized overnight mail courier, postage
                  prepaid and addressed, to such holder at the address shown for
                  such holder
                  on the books of the Company, or at such other address as shall
                  have been
                  furnished to the Company by notice from such holder.  All
                  notices, requests, and other communications required or permitted
                  to be
                  given or delivered hereunder to the Company shall be in writing,
                  and shall
                  be personally delivered, or shall be sent by certified or registered
                  mail
                  or by recognized overnight mail courier, postage prepaid and addressed,
                  to
                  the office of the Company at 20283 State Road, Suite 400, Boca
                  Raton, FL
                  33498, Attention: Chief Executive Officer, or at such other address
                  as
                  shall have been furnished to the holder of this Warrant by notice
                  from the
                  Company.  Any such

              

      

       

      
        
           

        

        
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                notice,
                  request, or other communication may be sent by facsimile, but shall
                  in
                  such case be subsequently confirmed by a writing personally delivered
                  or
                  sent by certified or registered mail or by recognized overnight
                  mail
                  courier as provided above.  All notices, requests, and other
                  communications shall be deemed to have been given either at the
                  time of
                  the receipt thereof by the person entitled to re­ceive such notice at
                  the address of such person for purposes of this Paragraph 9, or,
                  if mailed
                  by registered or certified mail or with a recognized overnight
                  mail
                  courier upon deposit with the United States Post Office or such
                  overnight
                  mail courier, if postage is prepaid and the mailing is properly
                  addressed,
                  as the case may be.

              

      

       

      10.           Governing
        Law.

       

      
        	
                  THIS
                  WARRANT SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN ACCORDANCE
                  WITH
                  THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
                  AND TO BE
                  PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES
                  OF
                  CONFLICT OF LAWS.  THE PARTIES HERETO HEREBY SUBMIT TO THE
                  EXCLUSIVE JURISDICTION OF THE UNITED STATES FEDERAL COURTS LOCATED
                  IN NEW
                  YORK, NEW YORK WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS WARRANT,
                  THE
                  AGREEMENTS ENTERED INTO IN CONNECTION HEREWITH OR THE TRANSACTIONS
                  CONTEMPLATED HEREBY OR THEREBY. BOTH PARTIES IRREVOCABLY WAIVE
                  THE DEFENSE
                  OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH SUIT OR
                  PROCEEDING.  BOTH PARTIES FURTHER AGREE THAT SERVICE OF PROCESS
                  UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE DEEMED IN EVERY
                  RESPECT
                  EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR
                  PROCEEDING.  NOTHING HEREIN SHALL AFFECT EITHER PARTY’S RIGHT TO
                  SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.  BOTH
                  PARTIES AGREE THAT A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH
                  SUIT OR
                  PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS
                  BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER LAWFUL MANNER.  THE
                  PARTY WHICH DOES NOT PREVAIL IN ANY DISPUTE ARISING UNDER THIS
                  WARRANT
                  SHALL BE RESPONSIBLE FOR ALL FEES AND EXPENSES, INCLUDING ATTORNEYS’ FEES,
                  INCURRED BY THE PREVAILING PARTY IN CONNECTION WITH SUCH
                  DISPUTE.

              

      

       

      11.           Miscellaneous.

       

      (a)           Amendments.  This
        Warrant and any provision hereof may only be amended by an instrument in
        writing
        signed by the Company and the holder hereof.

       

      (b)           Descriptive
        Headings.  The descriptive headings of
        the several paragraphs of this Warrant are in­serted for purposes of
        reference only, and shall not affect the meaning or construction of any of
        the
        provisions hereof.

       

      (c)           Cashless
        Exercise.  Notwithstanding anything to
        the contrary contained in this Warrant, if the resale of the Warrant Shares
        by
        the holder is not then registered pursuant to an effective registration
        statement under the Securities Act, this Warrant may be exercised by
        presentation and surrender of this Warrant to the Company at its principal
        executive offices with a written notice of the holder’s intention to effect a
        cashless exercise, including a calculation of the number of shares of Common
        Stock to be issued upon such exercise in accordance with the terms hereof
        (a
“Cashless Exercise”).  In the event of a Cashless Exercise, in lieu of
        paying the Exercise Price in cash, the holder shall surrender this Warrant
        for
        that number of shares of Common Stock determined by multiplying the number
        of
        Warrant Shares to which it would otherwise be entitled by a fraction, the
        numerator of which shall be the difference between the then current Market
        Price
        per share of the Common Stock and the Exercise Price,  and the
        denominator of which shall be the then current Market Price per share of
        Common
        Stock.  For example, if the holder is exercising 100,000 Warrants with
        a per Warrant exercise price of $0.75 per share through a cashless exercise
        when
        the Common Stock’s current Market Price per share is $2.00 per share, then upon
        such Cashless Exercise the holder will receive 62,500 shares of Common
        Stock.

       

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

       

      

       

      

       

      

       

      

       

      

       

      

       

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK]

       

      
        
           

        

        
          -
            11
            -

          
            

          

        

        
           

        

      

      IN
        WITNESS WHEREOF, the Company has caused this Warrant to be signed by
        its duly authorized officer.

       

      JUNIPER
        GROUP, INC.

      

      

      

      By:
        _______________________________

       Vlado
        Hreljanovic

       Chief
        Executive Officer

      

       

      Dated
        as
        of December 26, 2007

       

      
        
           

        

        
          -
            12
            -

          
            

          

        

        
           

        

      

      FORM
        OF EXERCISE AGREEMENT

       

      

       

      Dated:  ________
        __,
        200_

       

      

       

      To:           ______________________

       

      

       

      

       

      The
        undersigned, pursuant to the provisions set forth in the within Warrant,
        hereby
        agrees to purchase ________ shares of Common Stock covered by such Warrant,
        and
        makes pay­ment herewith in full therefor at the price per share provided by
        such Warrant in cash or by certified or official bank check in the amount
        of,
        or, if the resale of such Common Stock by the undersigned is not currently
        registered pursuant to an effective registration statement under the Securities
        Act of 1933, as amended, by surrender of securities issued by the Company
        (including a portion of the Warrant) having a market value (in the case of
        a
        portion of this Warrant, determined in accordance with Section 11(c) of the
        Warrant) equal to $_________.  Please issue a certificate or
        certifi­cates for such shares of Common Stock in the name of and pay any
        cash for any fractional share to:

       

      

       

      Name:                      ______________________________

      

      

      Signature:

      Address:____________________________

      _____________________________

      

      

      
        	
                 

              	
                Note:

              	
                The
                  above signature should correspond exactly with the name on the
                  face of the
                  within Warrant, if applicable.

              

      

      

       

      and,
        if
        said number of shares of Common Stock shall not be all the shares purchasable
        under the within Warrant, a new Warrant is to be issued in the name of said
        undersigned covering the balance of the shares purchasable thereunder less
        any
        frac­tion of a share paid in cash.

       

      
        
           

        

        
          -
            13
            -

          
            

          

        

        
           

        

      

      FORM
        OF ASSIGNMENT

       

      

       

      

       

      FOR
        VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
        all the rights of the undersigned under the within Warrant, with respect
        to the
        number of shares of Common Stock covered thereby set forth hereinbelow,
        to:

      

       

      Name
        of
        Assignee                                                                Address                                                                No
        of Shares

       

      

       

      

       

      

       

      ,
        and
        hereby irrevocably constitutes and appoints ___________________________________
        as agent and attorney-in-fact to trans­fer said Warrant on the books of the
        within-named corporation, with full power of substitution in the
        premises.

       

      

       

      Dated:                      ________
        __, 200_

       

      

       

      In
        the
        presence
        of:                                                                                    ______________________________

       

      Name:______________________________

      

       

      Signature:_________________________

      Title
        of
        Signing Officer or Agent (if any):

      ______________________________

      Address:                      ______________________________

      ______________________________

      

      

      Note:                      The
        above signature should correspond exactly with the name on the face of the
        within Warrant, if applicable.

      
        
           

        

        
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            14
            -

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