Document:

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                                                                   EXHIBIT 10.39

                                     WARRANT

                      To Purchase Shares of Common Stock of

                                BIO-PLEXUS, INC.

                             At a Purchase Price of
                                 $3.00 per Share
                   (Subject to Adjustment as Provided herein)

                    No. of Shares of Common Stock: _________
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                             TABLE OF CONTENTS
                             -----------------

<TABLE>
<CAPTION>
Section                                                                 Page
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<S>                                                                     <C>
1.   DEFINITIONS                                                          1
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2.   EXERCISE OF WARRANT                                                  4
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2.1. MANNER OF EXERCISE.                                                  4
2.2. PAYMENT OF TAXES.                                                    5
2.3. FRACTIONAL SHARES.                                                   5

3.   TRANSFER, DIVISION AND COMBINATION                                   6
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</TABLE>
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<TABLE>
<S>                                                                      <C>
3.1. TRANSFER.                                                            6
3.2. DIVISION AND COMBINATION.                                            6
3.3. EXPENSES.                                                            6
3.4. MAINTENANCE OF BOOKS.                                                6

4.   ADJUSTMENTS                                                          6
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4.1. STOCK DIVIDENDS, SUBDIVISIONS AND COMBINATIONS.                      6
4.2. CERTAIN OTHER DISTRIBUTIONS.                                         7
4.3. ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK.                       8
4.4. ISSUANCE OF WARRANTS OR OTHER RIGHTS.                                8
4.5. ISSUANCE OF CONVERTIBLE SECURITIES.                                  9
4.6. SUPERSEDING ADJUSTMENT.                                             10
4.7. OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS UNDER THIS SECTION.      10
4.8. REORGANIZATION, RECLASSIFICATION, MERGER, CONSOLIDATION
     OR DISPOSITION OF ASSETS.                                           12
4.9. OTHER ACTION AFFECTING COMMON STOCK.                                13
4.10.CERTAIN LIMITATIONS.                                                13

5.   NOTICES TO WARRANT HOLDERS                                          13
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5.1. NOTICE OF ADJUSTMENTS.                                              13
5.2. NOTICE OF CORPORATE ACTION.                                         13

6.   RIGHTS OF HOLDERS                                                   14
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6.1  NO IMPAIRMENT.                                                      14

7.   RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION
     WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY                      15
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</TABLE>
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<TABLE>
<S>                                                                      <C>
8.   TAKING OF RECORD; STOCK AND WARRANT TRANSFER BOOKS                  15
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9.   RESTRICTIONS ON TRANSFERABILITY                                     15
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9.1. RESTRICTIVE LEGEND.                                                 15
9.2. NOTICE OF PROPOSED TRANSFERS; REQUESTS FOR REGISTRATION.            16
9.3. TERMINATION OF RESTRICTIONS.                                        16

10.  PREEMPTIVE RIGHTS                                                   16
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11.  SUPPLYING INFORMATION                                               17
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12.  LOSS OR MUTILATION                                                  17
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13.  LIMITATION OF LIABILITY                                             18
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14.  MISCELLANEOUS                                                       18
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14.1. NONWAIVER AND EXPENSES.                                            18
14.2. NOTICE GENERALLY.                                                  18
14.3. REMEDIES.                                                          19
14.4. SUCCESSORS AND ASSIGNS.                                            19
14.5. AMENDMENT.                                                         19
</TABLE>
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<TABLE>
<S>                                                                      <C>
14.6. SEVERABILITY.                                                      19
14.7. HEADINGS.                                                          19
14.8. GOVERNING LAW.                                                     19
</TABLE>
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THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS
OF SUCH ACT OR SUCH LAWS

No. of Shares of Common Stock:
                               ----------

                                     WARRANT

                      To Purchase Shares of Common Stock of

                                BIO-PLEXUS, INC.

          THIS IS TO CERTIFY THAT _______________, or its registered
assigns (the "Holder"), is entitled, at any time prior to the Expiration
Date (as hereinafter defined), to purchase from BIO-PLEXUS, INC., a
Connecticut corporation (the "Company"), _________ (subject to adjustment
as provided herein) shares of Common Stock (as hereinafter defined), in
whole or in part, at a purchase price of $3.00 per share (subject to
adjustment as provided herein), all on the terms and conditions and
pursuant to the provisions hereinafter set forth.

1.   DEFINITIONS

          As used in this Warrant, the following terms have the respective
meanings set forth below:

          "Additional Shares of Common Stock" shall mean all shares of
Common Stock issued by the Company after the Issue Date, other than (i)
Warrant Stock, (ii) shares of Common Stock issuable upon the conversion of
the Convertible Notes to be issued under the Convertible Note Purchase
Agreement and (iii) shares of Common Stock issuable upon exercise of the $7
Warrants to be issued pursuant to the Convertible Note Purchase Agreement.

          "Average Market Price" shall mean, in respect of any share of
Common Stock on any date herein specified, the daily volume weighted
average sale price per share of Common Stock for such date. The closing
price for each day shall be the last quoted sale price or, if not so
quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of
Securities Dealers, Inc., Automated Quotation System or such other system
then in use, or, if on any such date the Common Stock or such other
<PAGE>   7
securities are not quoted by any such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making a market
in the Common Stock selected by the Board of Directors of the Company. If the
Common Stock is listed or admitted to trading on a national securities exchange,
the closing price shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Common Stock is not listed or
admitted to trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Common Stock is listed
or admitted to trading.

          "Business Day" shall mean any day that is not a Saturday or
Sunday or a day on which banks are required or permitted to be closed in
the State of New York.

          "Capital Stock" means, in the case of the Company, any and all
shares (however designated) of the capital stock of the Company now or
hereafter outstanding.

          "Commission" shall mean the Securities and Exchange Commission or
any other federal agency then administering the Securities Act and other
federal securities laws.

          "Common Stock" shall mean (except where the context otherwise
indicates) the Common Stock, no par value, of the Company as constituted on
the Issue Date, and any capital stock into which such Common Stock may
thereafter be changed, and shall also include (i) capital stock of the
Company of any other class (regardless of how denominated) issued to the
holders of shares of Common Stock upon any reclassification thereof and
(ii) shares of common stock of any successor or acquiring corporation (as
defined in Section 4.8) received by or distributed to the holders of Common
Stock of the Company in the circumstances contemplated by Section 4.8.

          "Convertible Note Purchase Agreement" shall mean the convertible
note purchase agreement to be entered into by and among the Company, the
purchasers listed on Exhibit A thereto and Appaloosa Management L.P., as
collateral agent.

          "Convertible Notes" shall mean the notes to be issued pursuant to
the Convertible Note Purchase Agreement.

          "Convertible Securities" shall mean evidences of indebtedness,
shares of stock or other securities which are convertible into or
exchangeable or exercisable, with or without payment of additional
consideration in cash or property, for Additional Shares of Common Stock,
either immediately or upon the occurrence of a specified date or a
specified event.

          "Current Market Price" shall mean, in respect of any share of
<PAGE>   8
Common Stock on any date herein specified, the average of the Average Market
Price for the twenty Business Days ending five days prior to such date.

          "Current Warrant Price" shall mean, in respect of a share of
Common Stock at any date herein specified, the price at which a share of
Common Stock may be purchased pursuant to this Warrant on such date. The
Current Warrant Price as of the date of the issuance of this Warrant is
$3.00.

          "Expiration Date" shall mean a date which is nine years from the
issuance of this Warrant.

          "Holder" shall mean the Person in whose name this Warrant is
registered on the books of the Company maintained for such purpose.
"Holders" shall mean, collectively, each Holder of a Warrant, in the event
of any division of this Warrant.

          "Issue Date" shall mean __________, 2000.

          "Majority Holders" shall mean the holders of Warrants exercisable
for in excess of 50% of the aggregate number of shares of Warrant Stock
then purchasable upon exercise of all Warrants.

          "Other Property" shall have the meaning set forth in Section 4.8.

          "Outstanding" shall mean, when used with reference to Common
Stock, at any date as of which the number of shares thereof is to be
determined, all issued shares of Common Stock, except shares then owned or
held by or for the account of the Company or any subsidiary thereof, and
shall include all shares issuable in respect of outstanding scrip or any
certificates representing fractional interests in shares of Common Stock.
For the purposes of Sections 4.3, 4.4, 4.5, 4.6 and 4.7, Common Stock
Outstanding shall include all shares of Common Stock issuable in respect of
options or warrants to purchase, or securities convertible into, shares of
Common Stock, the exercise or conversion price of which is less than the
Current Market Price as of any date on which the number of shares of Common
Stock Outstanding is to be determined.

          "Permitted Issuances" shall mean issuances of shares of Common
Stock and upon exercise of the warrants and options and other convertible
securities, in each case listed on Schedule 1.

          "Person" shall mean any individual, firm, corporation,
partnership or other entity, and shall include any successor by merger or
otherwise of such entity.

          "Restricted Common Stock" shall mean shares of Common Stock which
are, or which upon their issuance on the exercise of this Warrant would be,
evidenced by a certificate bearing the restrictive legend set forth in
Section 9.1(a).
<PAGE>   9
          "Securities Act" shall mean the Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of
the Commission thereunder, all as the same shall be in effect at the time.

          "Security" or "Securities" shall mean any equity or debt security
of the Company (including, without limitation, subscriptions, options,
warrants, rights, stock-based or stock-related awards or convertible or
exchangeable securities to which the Company is a party or by which the
Company may be bound of any character relating to, or obligating the
Company to issue, grant, award, transfer or sell any issued or unissued
shares of the Company's Capital Stock or other securities of the Company).

          "Trading Day" means a Business Day or, if the Common Stock is
listed or admitted to trading in any national securities exchange, a day on
which such exchange is open for the transaction of business.

          "Transfer" shall mean any disposition of any Warrant or Warrant
Stock or of any interest in either thereof, which would constitute a sale
thereof within the meaning of the Securities Act.

          "Transfer Notice" shall have the meaning set forth in Section
9.2.

          "Warrants" shall mean this Warrant and all warrants issued upon
transfer, division or combination of, or in substitution for, any thereof.
All Warrants shall at all times be identical as to terms and conditions and
date, except as to the number of shares of Common Stock for which they may
be exercised.

          "Warrant Stock" shall mean the shares of Common Stock purchased
by the holders of the Warrants upon the exercise thereof.

2.   EXERCISE OF WARRANT

     2.1. MANNER OF EXERCISE. At any time or from time to time from and
after the Issue Date and until 5:00 P.M., New York time, on the Expiration
Date, Holder may exercise this Warrant, on any Business Day, for all or any
part of the number of shares of Common Stock purchasable hereunder.

          In order to exercise this Warrant, in whole or in part, Holder
shall deliver to the Company at its principal office at 129 Reservoir Road,
Vernon, CT 06066 (i) a written notice of Holder's election to exercise this
Warrant, which notice shall specify the number of shares of Common Stock to
be purchased, (ii) payment of the aggregate Current Warrant Price for such
shares and (iii) this Warrant. Such notice shall be substantially in the
form appearing at the end of this Warrant as Exhibit A, duly executed by
Holder. Thirty days after receipt of the items specified in the second
<PAGE>   10
preceding sentence, the Company shall execute or cause to be executed and
deliver or cause to be delivered to Holder a certificate or certificates
representing the aggregate number of full shares of Common Stock issuable upon
such exercise, together with cash in lieu of any fraction of a share, as
hereinafter provided. The stock certificate or certificates so delivered shall
be in such denomination or denominations as Holder shall request in the notice
and shall be registered in the name of Holder or, subject to Section 9, such
other name as shall be designated in the notice. This Warrant shall be deemed to
have been exercised and such certificate or certificates shall be deemed to have
been issued, and Holder or any other Person so designated shall be deemed to
have become a holder of record of such shares for all purposes, as of the date
which is thirty days after the date of the notice, together with the Current
Warrant Price and this Warrant, are received by the Company as described above.
If this Warrant shall have been exercised in part, the Company shall, at the
time of delivery of the certificate or certificates representing Warrant Stock,
deliver to Holder a new Warrant evidencing the right of Holder to purchase the
unpurchased shares of Common Stock called for by this Warrant, which new Warrant
shall in all other respects be identical with this Warrant, or, at the request
of Holder, appropriate notation may be made on this Warrant and the same
returned to Holder.

          Payment of the Current Warrant Price shall be made at the option
of Holder by (i) certified or official bank check, (ii) wire transfer of
immediately available funds, (iii) tendering Convertible Notes having an
Accreted Value (as defined in the Convertible Note Purchase Agreement)
equal to the Current Warrant Price (the Company hereby agreeing to reissue
any Convertible Notes of a Holder into one or more Convertible Notes in
denominations requested by such Holder) or (iv) the surrender of this
Warrant to the Company, with a duly executed exercise notice marked to
reflect "Net Issue Exercise," and, in either case, specifying the number of
shares of Common Stock to be purchased, during normal business hours on any
Business Day. Upon a Net Issue Exercise, Holder shall be entitled to
receive shares of Common Stock equal to the value of this Warrant (or the
portion thereof being exercised by Net Issue Exercise) by surrender of this
Warrant to the Company together with notice of such election, in which
event the Company shall issue to Holder a number of shares of the Company's
Common Stock computed as of the date of surrender of this Warrant to the
Company using the following formula:

          X = Yx(A-B)
              -------
                A

     Where  X = the number of shares of Common Stock to be issued to the
                Holder
     Y = the number of shares of Warrant Stock being exercised under this
<PAGE>   11
         Warrant;
     A = the Current Market Price of one share of the Company's Common
         Stock (at the date of such calculation);
     B = the Current Warrant Price (as adjusted to the date of such
         calculation).

     2.2. PAYMENT OF TAXES. All shares of Common Stock issuable upon the
exercise of this Warrant shall be validly issued, fully paid and
nonassessable. The Company shall pay all expenses in connection with, and
all taxes (other than income taxes or capital gain tax of the Holder) and
other governmental charges that may be imposed with respect to, the issue
or delivery thereof.

     2.3. FRACTIONAL SHARES. The Company shall not be required to issue a
fractional share of Common Stock upon exercise of this Warrant. As to any
fraction of a share which Holder would otherwise be entitled to purchase
upon such exercise, the Company shall pay a cash adjustment in respect of
such fraction in an amount equal to the same fraction of the Current Market
Price per share of Common Stock on the date of exercise.

3.   TRANSFER, DIVISION AND COMBINATION

     3.1. TRANSFER. Subject to compliance with Section 9, transfer of this
Warrant and all rights hereunder, in whole or in part, shall be registered
on the books of the Company to be maintained for such purpose, upon
surrender of this Warrant at the principal office of the Company referred
to in Section 2.1, together with a written assignment of this Warrant
substantially in the form of Exhibit B hereto duly executed by Holder and
funds sufficient to pay any transfer taxes payable upon the making of such
transfer. Upon such surrender and, if required, such payment, the Company
shall, subject to Section 9, execute and deliver a new Warrant or Warrants
in the name of the assignee or assignees and in the denomination specified
in such instrument of assignment, and shall issue to the assignor a new
Warrant evidencing the portion of this Warrant not so assigned, and this
Warrant shall promptly be canceled. A Warrant, if properly assigned in
compliance with Section 9, may be exercised by a new Holder for the
purchase of shares of Common Stock without having a new Warrant issued.

     3.2. DIVISION AND COMBINATION. Subject to Section 9, this Warrant may
be divided into multiple Warrants or combined with other Warrants upon
presentation hereof at the aforesaid office or agency of the Company,
together with a written notice specifying the names and denominations in
which new Warrants are to be issued, signed by Holder. Subject to
compliance with Section 3.1 and with Section 9, as to any transfer which
may be involved in such division or combination, the Company shall execute
and deliver a new Warrant or Warrants in exchange for the Warrant or
Warrants to be divided or combined in accordance with such notice.
<PAGE>   12
     3.3. EXPENSES. The Company shall prepare, issue and deliver at its own
expense (other than transfer taxes) the new Warrant or Warrants under this
Section 3.

     3.4. MAINTENANCE OF BOOKS. The Company agrees to maintain, at its
aforesaid office, books for the registration and the registration of
transfer of the Warrants.

4.   ADJUSTMENTS

          The number of shares of Common Stock for which this Warrant is
exercisable and/or the price at which such shares may be purchased upon
exercise of this Warrant, shall be subject to adjustment from time to time
as set forth in this Section 4. The Company shall give each Holder notice
of any event described below which requires an adjustment pursuant to this
Section 4 at the time of such event.

     4.1. STOCK DIVIDENDS, SUBDIVISIONS AND COMBINATIONS. If at any time
the Company shall:

          (a) take a record of the holders of its Common Stock for the
     purpose of entitling them to receive a dividend payable in, or other
     distribution of, Additional Shares of Common Stock,

          (b) subdivide its outstanding shares of Common Stock into a
     larger number of shares of Common Stock, or

          (c) combine its outstanding shares of Common Stock into a smaller
     number of shares of Common Stock,

then (i) the number of shares of Common Stock for which this Warrant is
exercisable immediately after the occurrence of any such event shall be
adjusted to equal the number of shares of Common Stock which a record
holder of the same number of shares of Common Stock for which this Warrant
is exercisable immediately prior to the occurrence of such event would own
or be entitled to receive after the happening of such event, and (ii) the
Current Warrant Price per share shall be adjusted to equal (A) the Current
Warrant Price multiplied by the number of shares of Common Stock for which
this Warrant is exercisable immediately prior to the adjustment divided by
(B) the number of shares for which this Warrant is exercisable immediately
after such adjustment.

     4.2. CERTAIN OTHER DISTRIBUTIONS. If at any time the Company shall
take a record of the holders of its Common Stock for the purpose of
entitling them to receive any dividend or other distribution of:

          (a) cash,

          (b) any evidences of its indebtedness, any shares of stock or any
<PAGE>   13
     other securities or property of any nature whatsoever (other than
     cash, Convertible Securities or Additional Shares of Common Stock), or

          (c) any warrants or other rights to subscribe for or purchase any
     evidences of its indebtedness, any shares of its stock or any other
     securities or property of any nature whatsoever (other than cash,
     Convertible Securities or Additional Shares of Common Stock),

then (i) the number of shares of Common Stock for which this Warrant is
exercisable shall be adjusted to equal the product of the number of shares
of Common Stock for which this Warrant is exercisable immediately prior to
such adjustment and a fraction (A) the numerator of which shall be the
Current Market Price per share of Common Stock at the date of taking such
record and (B) the denominator of which shall be such Current Market Price
per share of Common Stock minus the amount allocable to one share of Common
Stock of any such cash so distributable and of the fair value (as
determined in good faith by the Board of Directors of the Company) of any
and all such evidences of indebtedness, shares of stock, other securities
or property or warrants or other subscription or purchase rights so
distributable, and (ii) the Current Warrant Price shall be adjusted to
equal (A) the Current Warrant Price multiplied by the number of shares of
Common Stock for which this Warrant is exercisable immediately prior to the
adjustment divided by (B) the number of shares for which this Warrant is
exercisable immediately after such adjustment. A reclassification of the
Common Stock (other than a change in par value, or from par value to no par
value or from no par value to par value) into shares of Common Stock and
shares of any other class of stock shall be deemed a distribution by the
Company to the holders of its Common Stock of such shares of such other
class of stock within the meaning of this Section 4.2 and, if the
outstanding shares of Common Stock shall be changed into a larger or
smaller number of shares of Common Stock as a part of such
reclassification, such change shall be deemed a subdivision or combination,
as the case may be, of the outstanding shares of Common Stock within the
meaning of Section 4.1.

     4.3. ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. (a) If at any time
the Company shall (except as hereinafter provided) issue or sell any
Additional Shares of Common Stock, other than Permitted Issuances, in
exchange for consideration in an amount per Additional Share of Common
Stock less than the Current Warrant Price at the time the Additional Shares
of Common Stock are issued, then (i) the Current Warrant Price as to the
number of shares for which this Warrant is exercisable prior to such
adjustment shall be reduced to a price determined by multiplying (A) the
Current Warrant Price by (B) a fraction, the numerator of which shall be
the sum of (x) the number of shares of Common Stock Outstanding immediately
prior to such issue or sale multiplied by the then applicable Current
Warrant Price (the "Adjustment Price") and (y) the aggregate consideration
receivable by the Company for the total number of shares of Common Stock
<PAGE>   14
so issued, and the denominator of which shall be the sum of (a) the total number
of shares of Common Stock Outstanding on such date and (b) the number of
Additional Shares issued, multiplied by the Adjustment Price; and (ii) the
number of shares of Common Stock for which this Warrant is exercisable shall be
adjusted to equal the product obtained by multiplying the Current Warrant Price
in effect immediately prior to such issue or sale by the number of shares of
Common Stock for which this Warrant is exercisable immediately prior to such
issue or sale and dividing the product thereof by the Current Warrant Price
resulting from the adjustment made pursuant to clause (i) above. For purposes of
this Section 4.3 and for the purposes of making adjustments of the number of
shares of Common Stock for which this Warrant is exercisable and the Current
Warrant Price as provided in this Section 4, the aggregate consideration
receivable by the Company in connection with the issuance of shares of Common
Stock or of rights, warrants or other securities convertible into shares of
Common Stock shall be deemed to be equal to the sum of the aggregate offering
price (before deduction of underwriting discounts or commissions and expenses
payable to third parties) of all such Common Stock, rights, warrants and
convertible securities plus the aggregate amount (as determined on the date of
issuance), if any, payable upon exercise or conversion of any such rights,
warrants and convertible securities into shares of Common Stock. If, subsequent
to the date of issuance of such rights, warrants or Convertible Securities, the
exercise or conversion price thereof is reduced, such aggregate amount shall be
recalculated and the Current Warrant Price and number of shares of Common Stock
for which the Warrant is exercisable adjusted retroactively to give effect to
such reduction. If Common Stock is sold as a unit with other securities, the
aggregate consideration received for such Common Stock shall be deemed to be net
of the Fair Market Value of such other securities.

     4.4. ISSUANCE OF WARRANTS OR OTHER RIGHTS. If at any time the Company
shall take a record of the holders of its Common Stock for the purpose of
entitling them to receive a distribution of, or shall in any manner
(whether directly or by assumption in a merger in which the Company is the
surviving corporation) issue or sell, any warrants or other rights to
subscribe for or purchase any Additional Shares of Common Stock or any
Convertible Securities (other than Permitted Issuances), whether or not the
rights to exchange or convert thereunder are immediately exercisable, and
the price per share for which Common Stock is issuable upon the exercise of
such warrants or other rights or upon conversion or exchange of such
Convertible Securities shall be less than the Current Warrant Price in
effect immediately prior to the time of such issue or sale, then the number
of shares for which this Warrant is exercisable and the Current Warrant
Price shall be adjusted as provided in Section 4.3 on the basis that the
maximum number of Additional Shares of Common Stock issuable pursuant to
all such warrants or other rights or necessary to effect the conversion or
exchange of all such Convertible Securities shall be deemed to have been
<PAGE>   15
issued and outstanding and the Company shall have received all of the
consideration payable therefor, if any, as of the date of the actual issuance of
the number such warrants or other rights. No further adjustments of the Current
Warrant Price shall be made upon the actual issue of such Common Stock or of
such Convertible Securities upon exercise of such warrants or other rights or
upon the actual issue of such Common Stock upon such conversion or exchange of
such Convertible Securities. Notwithstanding the foregoing, no adjustment shall
be required under this Section 4.4 solely by reason of the issuance or
distribution of stock purchase rights pursuant to a shareholder rights plan or
any other rights plan of the Company, provided that the adjustments required by
this Section 4.4 shall be made if any "flip-in" or "flip-over" event shall occur
under such stockholder rights plan.

     4.5. ISSUANCE OF CONVERTIBLE SECURITIES. If at any time the Company
shall take a record of the holders of its Common Stock for the purpose of
entitling them to receive a distribution of, or shall in any manner
(whether directly or by assumption in a merger in which the Company is the
surviving corporation) issue or sell, any Convertible Securities (other
than Permitted Issuances), whether or not the rights to exchange or convert
thereunder are immediately exercisable, and the price per share for which
Common Stock is issuable upon such conversion or exchange shall be less
than the Current Warrant Price in effect immediately prior to the time of
such issue or sale, then the number of shares for which this Warrant is
exercisable and the Current Warrant Price shall be adjusted as provided in
Section 4.3 on the basis that the maximum number of Additional shares of
Common Stock necessary to effect the conversion or exchange of all such
Convertible Securities shall be deemed to have been issued and outstanding
and the Company shall have received all of the consideration payable
therefor, if any, as of the date of actual issuance of such Convertible
Securities. No adjustment of the number of shares for which this Warrant is
exercisable and the Current Warrant Price shall be made under this Section
4.5 upon the issuance of any Convertible Securities which are issued
pursuant to the exercise of any warrants or other subscription or purchase
rights therefor, if any such adjustment shall previously have been made
upon the issuance of such warrants or other rights pursuant to Section 4.4.
No further adjustments of the number of shares for which this Warrant is
exercisable and the Current Warrant Price shall be made upon the actual
issue of such Common Stock upon conversion or exchange of such Convertible
Securities and, if any issue or sale of such Convertible Securities is made
upon exercise of any warrant or other right to subscribe for or to purchase
any such Convertible Securities for which adjustments of the number of
shares for which this Warrant is exercisable and the Current Warrant Price
have been or are to be made pursuant to other provisions of this Section 4,
<PAGE>   16
no further adjustments of the number of shares for which this Warrant is
exercisable and the Current Warrant Price shall be made by reason of such issue
or sale.

     4.6. SUPERSEDING ADJUSTMENT. If, at any time after any adjustment of
the number of shares for which this Warrant is exercisable and the Current
Warrant Price shall have been made pursuant to Section 4.4 or Section 4.5
as the result of any issuance of warrants, rights or Convertible
Securities, such warrants or rights, or the right of conversion or exchange
in such other Convertible Securities, shall expire, and all of such
warrants or rights, or the right of conversion or exchange with respect to
all or a portion of such other Convertible Securities, as the case may be,
shall not have been exercised and no outstanding Warrant shall have been
exercised (in whole or in part), then for each outstanding Warrant such
previous adjustment shall be rescinded and annulled and the Additional
Shares of Common Stock which were deemed to have been issued by virtue of
the computation made in connection with the adjustment so rescinded and
annulled shall no longer be deemed to have been issued by virtue of such
computation.

     4.7. OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS UNDER THIS SECTION.
The following provisions shall be applicable to the making of adjustments
of the number of shares of Common Stock for which this Warrant is
exercisable and the Current Warrant Price provided for in this Section 4:

          (a) Computation of Consideration. To the extent that any
Additional Shares of Common Stock or any Convertible Securities or any
warrants or other rights to subscribe for or purchase any Additional Shares
of Common Stock or any Convertible Securities shall be issued for cash
consideration, the consideration received by the Company therefor shall be
the amount of the cash received by the Company therefor, or, if such
Additional Shares of Common Stock or Convertible Securities are offered by
the Company for subscription, the subscription price, or, if such
Additional Shares of Common Stock or Convertible Securities are sold to
underwriters or dealers for public offering without a subscription
offering, the public offering price (in any such case subtracting any
amounts paid or receivable for accrued interest or accrued dividends). To
the extent that such issuance shall be for a consideration other than cash,
then, except as herein otherwise expressly provided, the amount of such
consideration shall be deemed to be the fair value of such consideration at
the time of such issuance as determined in good faith by the Board of
Directors of the Company. In case any Additional Shares of Common Stock or
any Convertible Securities or any warrants or other rights to subscribe for
or purchase such Additional Shares of Common Stock or Convertible
Securities shall be issued in connection with any merger in which the
Company issues any securities, the amount of consideration therefor shall
<PAGE>   17
be deemed to be the fair value, as determined in good faith by the Board of
Directors of the Company, of such portion of the assets and business of the
nonsurviving corporation as such Board in good faith shall determine to be
attributable to such Additional Shares of Common Stock, Convertible Securities,
warrants or other rights, as the case may be. The consideration for any
Additional Shares of Common Stock issuable pursuant to any warrants or other
rights to subscribe for or purchase the same shall be the consideration received
by the Company for issuing such warrants or other rights plus the additional
consideration payable to the Company upon exercise of such warrants or other
rights. The consideration for any Additional Shares of Common Stock issuable
pursuant to the terms of any Convertible Securities shall be the consideration
received by the Company for issuing warrants or other rights to subscribe for or
purchase such Convertible Securities, plus the consideration paid or payable to
the Company in respect of the subscription for or purchase of such Convertible
Securities, plus the additional consideration, if any, payable to the Company
upon the exercise of the right of conversion or exchange in such Convertible
Securities. In case of the issuance at any time of any Additional Shares of
Common Stock or Convertible Securities in payment or satisfaction of any
dividends upon any class of stock other than Common Stock, the Company shall be
deemed to have received for such Additional Shares of Common Stock or
Convertible Securities a consideration equal to the amount of such dividend so
paid or satisfied.

          (b) When Adjustments to Be Made. The adjustments required by this
Section 4 shall be made whenever and as often as any specified event
requiring an adjustment shall occur, except that any adjustment of the
number of shares of Common Stock for which this Warrant is exercisable that
would otherwise be required may be postponed (except in the case of a
subdivision or combination of shares of the Common Stock, as provided for
in Section 4.1) up to, but not beyond the date of exercise if such
adjustment either by itself or with other adjustments not previously made
results in an increase or decrease of less than 1% of the shares of Common
Stock for which this Warrant is exercisable immediately prior to the making
of such adjustment. Any adjustment representing a change of less than such
minimum amount (except as aforesaid) which is postponed shall be carried
forward and made as soon as such adjustment, together with other
adjustments required by this Section 4 and not previously made, would
result in a minimum adjustment or on the date of exercise. For the purpose
of any adjustment, any specified event shall be deemed to have occurred at
the close of business on the date of its occurrence.

          (c) Fractional Interests. In computing adjustments under this
Section 4, fractional interests in Common Stock shall be taken into account
to the nearest 1/100th of a share.
<PAGE>   18
          (d) When Adjustment Not Required. If the Company shall take a
record of the holders of its Common Stock for the purpose of entitling them
to receive a dividend or distribution or subscription or purchase rights
and shall, thereafter and before the distribution to stockholders thereof,
legally abandon its plan to pay or deliver such dividend, distribution,
subscription or purchase rights, then thereafter no adjustment shall be
required by reason of the taking of such record and any such adjustment
previously made in respect thereof shall be rescinded and annulled.

          (e) Escrow of Warrant Stock. If Holder exercises this Warrant
after any property becomes distributable pursuant to this Section 4 by
reason of the taking of any record of the holders of Common Stock, but
prior to the occurrence of the event for which such record is taken, any
additional shares of Common Stock issuable upon exercise by reason of such
adjustment shall be deemed the last shares of Common Stock for which this
Warrant is exercised (notwithstanding any other provision to the contrary
herein) and such shares or other property shall be held in escrow for
Holder by the Company to be issued to Holder when and to the extent that
the event actually takes place, upon payment of the then Current Warrant
Price. Notwithstanding any other provision to the contrary herein, if the
event for which such record was taken fails to occur or is rescinded, then
such escrowed shares shall be canceled by the Company and escrowed property
returned.

          (f) Challenge to Good Faith Determination. Whenever the Board of
Directors of the Company shall be required to make a determination in good
faith of the fair value of any item under this Section 4, such
determination may be challenged in good faith by the Majority Holders, and
any dispute shall be resolved by an investment banking firm of recognized
national standing selected by the Majority Holders and acceptable to the
Company.

     4.8. REORGANIZATION, RECLASSIFICATION, MERGER, CONSOLIDATION OR
DISPOSITION OF ASSETS. In case the Company shall reorganize its capital,
reclassify its capital stock, consolidate or merge with or into another
corporation (where the Company is not the surviving corporation or where
there is a change in or distribution with respect to the Common Stock of
the Company), or sell, transfer or otherwise dispose of all or
substantially all its property, assets or business to another corporation
and, pursuant to the terms of such reorganization, reclassification,
merger, consolidation or disposition of assets, shares of common stock of
the successor or acquiring corporation, or any cash, shares of stock or
other securities or property of any nature whatsoever (including warrants
or other subscription or purchase rights) in addition to or in lieu of
common stock of the successor or acquiring corporation ("Other Property"),
are to be received by or distributed to the holders of Common Stock of the
Company, then Holder shall have the right thereafter to receive, upon
exercise of this Warrant and payment of the Current Warrant Price, the
<PAGE>   19
number of shares of common stock of the successor or acquiring corporation or of
the Company, if it is the surviving corporation, and Other Property receivable
upon or as a result of such reorganization, reclassification, merger,
consolidation or disposition of assets by a holder of the number of shares of
Common Stock for which this Warrant is exercisable immediately prior to such
event. In case of any such reorganization, reclassification, merger,
consolidation or disposition of assets, the successor or acquiring corporation
(if other than the Company) shall expressly assume the due and punctual
observance and performance of each and every covenant and condition of this
Warrant to be performed and observed by the Company and all the obligations and
liabilities hereunder, subject to such modifications as may be deemed
appropriate (as determined by resolution of the Board of Directors of the
Company) in order to provide for adjustments of shares of the Common Stock for
which this Warrant is exercisable which shall be as nearly equivalent as
practicable to the adjustments provided for in this Section 4. For purposes of
this Section 4.8, "common stock of the successor or acquiring corporation" shall
include stock of such corporation of any class which is not preferred as to
dividends or assets over any other class of stock of such corporation and which
is not subject to redemption and shall also include any evidences of
indebtedness, shares of stock or other securities which are convertible into or
exchangeable for any such stock, either immediately or upon the arrival of a
specified date or the happening of a specified event and any warrants or other
rights to subscribe for or purchase any such stock. The foregoing provisions of
this Section 4.8 shall similarly apply to successive reorganizations,
reclassifications, mergers, consolidations or disposition of assets.

     4.9. OTHER ACTION AFFECTING COMMON STOCK. In case at any time or from
time to time the Company shall take any action in respect of its Common
Stock, other than any action described in this Section 4, then, unless such
action will not have a materially adverse effect upon the rights of the
Holders, the number of shares of Common Stock or other stock for which this
Warrant is exercisable and/or the purchase price thereof shall be adjusted
in such manner as may be equitable in the circumstances.

     4.10. CERTAIN LIMITATIONS. Notwithstanding anything herein to the
contrary, the Company agrees not to enter into any transaction which, by
reason of any adjustment hereunder, would cause the Current Warrant Price
to be less than the par value per share of Common Stock.

5.   NOTICES TO WARRANT HOLDERS
<PAGE>   20
     5.1. NOTICE OF ADJUSTMENTS. Whenever the number of shares of Common
Stock for which this Warrant is exercisable, or whenever the price at which
a share of such Common Stock may be purchased upon exercise of the
Warrants, shall be adjusted pursuant to Section 4, the Company shall
forthwith prepare a certificate to be executed by the chief financial
officer of the Company setting forth, in reasonable detail, the event
requiring the adjustment and the method by which such adjustment was
calculated (including a description of the basis on which the Board of
Directors of the Company determined the fair value of any evidences of
indebtedness, shares of stock, other securities or property or warrants or
other subscription or purchase rights referred to in Section 4.2 or
4.7(a)), specifying the number of shares of Common Stock for which this
Warrant is exercisable and (if such adjustment was made pursuant to Section
4.8 or 4.9) describing the number and kind of any other shares of stock or
Other Property for which this Warrant is exercisable, and any change in the
purchase price or prices thereof, after giving effect to such adjustment or
change. The Company shall promptly cause a signed copy of such certificate
to be delivered to each Holder in accordance with Section 14.2. The Company
shall keep at its principal office copies of all such certificates and
cause the same to be available for inspection at said office during normal
business hours by any Holder or any prospective purchaser of a Warrant
designated by a Holder thereof.

     5.2. NOTICE OF CORPORATE ACTION. If at any time

          (a) the Company shall take a record of the holders of its Common
     Stock for the purpose of entitling them to receive a dividend (other
     than a cash dividend payable out of earnings or earned surplus legally
     available for the payment of dividends under the laws of the
     jurisdiction of incorporation of the Company) or other distribution,
     or any right to subscribe for or purchase any evidences of its
     indebtedness, any shares of stock of any class or any other securities
     or property, or to receive any other right, or

          (b) there shall be any capital reorganization of the Company, any
     reclassification or recapitalization of the capital stock of the
     Company or any consolidation or merger of the Company with, or any
     sale, transfer or other disposition of all or substantially all the
     property, assets or business of the Company to, another corporation,
     or

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

then, in any one or more of such cases, the Company shall give to Holder
(i) at least 20 days' prior written notice of the date on which a record
date shall be selected for such dividend, distribution or right or for
determining rights to vote in respect of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
dissolution, liquidation or winding up, and (ii) in the case of any such
reorganization, reclassification, merger, consolidation, sale, transfer,
disposition,
<PAGE>   21
dissolution, liquidation or winding up, at least 20 days' prior written notice
of the date when the same shall take place. Such notice in accordance with the
foregoing clause also shall specify (i) the date on which any such record is to
be taken for the purpose of such dividend, distribution or right, the date on
which the holders of Common Stock shall be entitled to any such dividend,
distribution or right, and the amount and character thereof, and (ii) the date
on which any such reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up is to take place
and the time, if any such time is to be fixed, as of which the holders of Common
Stock shall be entitled to exchange their shares of Common Stock for securities
or other property deliverable upon such reorganization, reclassification,
merger, consolidation, sale, transfer, disposition, dissolution, liquidation or
winding up. Each such written notice shall be sufficiently given if addressed to
Holder at the last address of Holder appearing on the books of the Company and
delivered in accordance with Section 13.2.

6.   RIGHTS OF HOLDERS

     6.1 NO IMPAIRMENT. The Company shall not by any action, including,
without limitation, amending its Certificate of Incorporation, by-laws or
comparable governing instruments or through any reorganization, transfer of
assets, consolidation, merger, dissolution, issue or sale of securities or
any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking
of all such actions as may be necessary or appropriate to protect the
rights of Holder against impairment. Without limiting the generality of the
foregoing, the Company will (a) not increase the par value of any shares of
Common Stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise immediately prior to such increase in
par value, (b) take all such action 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, and
(c) use its best efforts to obtain all such authorizations, exemptions or
consents from any public regulatory body having jurisdiction thereof as may
be necessary to enable the Company to perform its obligations under this
Warrant.

          Upon the request of Holder, the Company will at any time during
the period this Warrant is outstanding acknowledge in writing, in form
reasonably satisfactory to Holder, the continuing validity of this Warrant
and the obligations of the Company hereunder.
<PAGE>   22
7.   RESERVATION AND AUTHORIZATION OF COMMON STOCK;
     REGISTRATION WITH OR APPROVAL OF ANY GOVERNMENTAL AUTHORITY

          From and after the Issue Date, the Company shall at all times
reserve and keep available for issue upon the exercise of Warrants such
number of its authorized but unissued shares of Common Stock as will be
sufficient to permit the exercise in full of all outstanding Warrants. All
shares of Common Stock which shall be so issuable, when issued upon
exercise of any Warrant and payment therefor in accordance with the terms
of such Warrant, shall be duly and validly issued and fully paid and
nonassessable.

8.   TAKING OF RECORD; STOCK AND WARRANT TRANSFER BOOKS

          In the case of all dividends or other distributions by the
Company to the holders of its Common Stock with respect to which any
provision of Section 4 refers to the taking of a record of such holders,
the Company will in each such case take such a record and will take such
record as of the close of business on a Business Day. The Company will not
at any time, except upon dissolution, liquidation or winding up of the
Company, close its stock transfer books or Warrant transfer books so as to
result in preventing or delaying the exercise or transfer of any Warrant.

9.   RESTRICTIONS ON TRANSFERABILITY

          The Warrants and the Warrant Stock shall not be transferred,
hypothecated or assigned before satisfaction of the conditions specified in
this Section 9, which conditions are intended to ensure compliance with the
provisions of the Securities Act with respect to the Transfer of any
Warrant or any Warrant Stock. Holder, by acceptance of this Warrant, agrees
to be bound by the provisions of this Section 9.

     9.1. RESTRICTIVE LEGEND. Except as otherwise provided in this Section
9, each Warrant and each certificate for Warrant Stock initially issued
upon the exercise of a Warrant, and each certificate for Warrant Stock
issued to any subsequent transferee of any such certificate, shall be
stamped or otherwise imprinted with a legend in substantially the following
form:

               "[THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY] [THE
          SECURITIES REPRESENTED BY THIS CERTIFICATE] HAVE NOT BEEN
          REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
          SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OTHERWISE
          DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
          STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR
          AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH
          ACT OR SUCH LAWS."

     9.2. NOTICE OF PROPOSED TRANSFERS; REQUESTS FOR REGISTRATION. Prior to
any Transfer or attempted Transfer of any Warrants or any shares of
<PAGE>   23
Restricted Common Stock, the holder of such Warrants or Restricted Common Stock
shall give ten days' prior written notice (a "Transfer Notice") to the Company
of such holder's intention to effect such Transfer, describing the manner and
circumstances of the proposed Transfer, and obtain from counsel to such holder
who shall be reasonably satisfactory to the Company, an opinion that the
proposed Transfer of such Warrants or such Restricted Common Stock may be
effected without registration under the Securities Act. After receipt of the
Transfer Notice and opinion, the Company shall, within five days thereof, notify
the holder of such Warrants or such Restricted Common Stock as to whether such
opinion is reasonably satisfactory and, if so, such holder shall thereupon be
entitled to Transfer such Warrants or such Restricted Common Stock, in
accordance with the terms of the Transfer Notice. Each certificate, if any,
evidencing such shares of Restricted Common Stock issued upon such Transfer and
each Warrant issued upon such Transfer shall bear the restrictive legend set
forth in Section 9.1, unless in the opinion of such counsel such legend is not
required in order to ensure compliance with the Securities Act. The holder of
the Warrants or the Restricted Common Stock, as the case may be, giving the
Transfer Notice shall not be entitled to Transfer such Warrants or such
Restricted Common Stock until receipt of notice from the Company under this
Section 9.2 that such opinion is reasonably satisfactory.

     9.3. TERMINATION OF RESTRICTIONS. Notwithstanding the foregoing
provisions of this Section 9, the restrictions imposed by this Section upon
the transferability of the Warrants, the Warrant Stock and the Restricted
Common Stock and the legend requirements of Section 9.1 shall terminate as
to any particular Warrant or share of Warrant Stock or Restricted Common
Stock (i) when and so long as such security shall have been effectively
registered under the Securities Act and disposed of pursuant thereto or
(ii) when the Company shall have received an opinion of counsel reasonably
satisfactory to it that such shares may be transferred without registration
thereof under the Securities Act.

10.  PREEMPTIVE RIGHTS

          (a) The Company shall not issue, sell or exchange, or agree to
issue, sell or exchange (collectively, "Issue," and any issuance, sale or
exchange resulting therefrom, an "Issuance") any Securities unless the
Company shall have first given written notice (the "Section 10 Notice") to
each holder of Warrants or Warrant Stock (for purposes of this Section,
each a "Section 10 Offeree") that shall (i) state the Company's intention
to Issue Securities, the amount to be issued, sold or exchanged, the terms
of such Securities, the purchase price therefor and a summary of the other
<PAGE>   24
material terms of the proposed issuance, sale or exchange and (ii) offer (a
"Section 10 Offer") to Issue to each Section 10 Offeree and their affiliates
such Section 10 Offeree's Proportionate Percentage (as defined below) of such
Securities (with respect to each Section 10 Offeree, the "Offered Securities")
upon the terms and subject to the conditions set forth in the Section 10 Notice,
which Section 10 Offer by its terms shall remain open and irrevocable for a
period of 15-days from the date it is delivered by the Company to such holder,
as the case may be (and, to the extent the Section 10 Offer is accepted during
such 15-day period, until the closing of the Issuance contemplated by the
Section 10 Offer). "Proportionate Percentage" for the purposes of this Section
shall mean the quotient obtained by dividing: (A) the Warrant Stock held by such
Section 10 Offeree (assuming for purposes of this Section 10 that all issued and
outstanding Warrants have been exercised) on the date of the Section 10 Offer,
by (B) the Warrant Stock issued and outstanding on the date of the Section 10
Offer.

          (b) Notice of a Section 10 Offeree's intention to accept a
Section 10 Offer, in whole or in part, shall be evidenced by a writing
signed by such party and delivered to the Company prior to the end of the
15-day period of such Section 10 Offer (each, a "Notice of Acceptance"),
setting forth the portion of the Offered Securities that the Section 10
Offeree elects to purchase, which election shall be binding.

          (c) In the event that a Notice of Acceptance is not given by a
Section 10 Offeree in respect of all the Offered Securities, the Company
shall have 60 days following the 15-day period referred to in clause (b)
above to Issue all or any part of such remaining Offered Securities not
covered by the Notice of Acceptance to any other Person(s), but only at a
price not less than the price, and on terms no more favorable to the person
than the terms, stated in the Section 10 Offer Notice. If the Company does
not consummate the Issuance of all or part of the remaining Offered
Securities to such other Person(s) within such period, the right provided
hereunder shall be deemed to be revived and such securities shall not be
offered unless first re-offered to each Section 10 Offeree in accordance
with this Section 10. Upon the closing of the Issuance to such other
Person(s) (the "Other Buyers") of all or part of the remaining Offered
Securities, each Section 10 Offeree shall purchase from the Company, and
the Company shall Issue to each such Section 10 Offeree, the Offered
Securities covered by the Notice of Acceptance delivered to the Company by
the Section 10 Offeree, on the terms specified in the Section 10 Offer. The
purchase by a Section 10 Offeree of any Offered Securities is subject in
all cases to the execution and delivery by the Company and the Section 10
Offeree of a purchase agreement relating to such Offered Securities in form
and substance similar in all material respects to the extent applicable to
that executed and delivered between the Company and the Other Buyers.

11.  SUPPLYING INFORMATION
<PAGE>   25
          The Company shall cooperate with each Holder of a Warrant and
each holder of Restricted Common Stock in supplying such information as may
be reasonably necessary for such holder to complete and file any reports or
forms presently or hereafter required by the Commission as a condition to
the availability of an exemption from the Securities Act for the sale of
any Warrant or Restricted Common Stock.

12.  LOSS OR MUTILATION

          Upon receipt by the Company from any Holder of evidence
reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of this Warrant and indemnity reasonably
satisfactory to it (it being understood that, in the case of the initial
holder, the written agreement of Appaloosa Management L.P. shall be
sufficient indemnity), and in case of mutilation upon surrender and
cancellation hereof, the Company will execute and deliver in lieu hereof a
new Warrant of like tenor to such Holder; provided, in the case of
mutilation, no indemnity shall be required if this Warrant in identifiable
form is surrendered to the Company for cancellation.

13.  LIMITATION OF LIABILITY

          No provision hereof, in the absence of affirmative action by
Holder to purchase shares of Common Stock, and no enumeration herein of the
rights or privileges of Holder hereof, shall give rise to any liability of
such Holder for the purchase price of any Common Stock or as a stockholder
of the Company, whether such liability is asserted by the Company or by
creditors of the Company.

14.  MISCELLANEOUS

     14.1. NONWAIVER AND EXPENSES. No course of dealing or any delay or
failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice Holder's rights, powers or
remedies. If the Company fails to make, when due, any payments provided for
hereunder, or fails to comply with any other provision of this Warrant, the
Company shall pay to Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys'
fees, including those of appellate proceedings, incurred by Holder in
collecting any amounts due pursuant hereto or in otherwise enforcing any of
its rights, powers or remedies hereunder.

     14.2. NOTICE GENERALLY. Any notice, demand, request, consent,
approval, declaration, delivery or other communication hereunder to be made
pursuant to the provisions of this Warrant shall be sufficiently given or
made if in writing and either delivered in person with receipt acknowledged
or sent by registered or certified mail, return receipt requested, postage
<PAGE>   26
prepaid, or by telecopy and confirmed by telecopy answerback, addressed as
follows:

          (a) If to any Holder or holder of Warrant Stock, at its last
     known address appearing on the books of the Company maintained for
     such purpose.

          (b) If to the Company at

              Bio-Plexus, Inc.
              129 Reservoir Road
              Vernon, CT 06066
              Attention:  Mr. Carl Sahi
              Fax:  (860) 870-6118

or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice, demand,
request, consent, approval, declaration, delivery or other communication
hereunder shall be deemed to have been duly given or served on the date on
which personally delivered, with receipt acknowledged, telecopied and
confirmed by telecopy answerback, or three Business Days after the same
shall have been deposited in the United States mail. Failure or delay in
delivering copies of any notice, demand, request, approval, declaration,
delivery or other communication to the person designated above to receive a
copy shall in no way adversely affect the effectiveness of such notice,
demand, request, approval, declaration, delivery or other communication.

     14.3. REMEDIES. Each holder of Warrant and Warrant Stock, in addition
to being entitled to exercise all rights granted by law, including recovery
of damages, will be entitled to specific performance of its rights under of
this Warrant. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of
the provisions of this Warrant and hereby agrees to waive the defense in
any action for specific performance that a remedy at law would be adequate.

     14.4. SUCCESSORS AND ASSIGNS. Subject to the provisions of Sections
3.1 and 9, this Warrant and the rights evidenced hereby shall inure to the
benefit of and be binding upon the successors of the Company and the
successors and assigns of Holder. The provisions of this Warrant are
intended to be for the benefit of all Holders from time to time of this
Warrant and, with respect to Section 9 hereof, holders of Warrant Stock,
and shall be enforceable by any such Holder or holder of Warrant Stock.

     14.5. AMENDMENT. This Warrant and all other Warrants may be modified
or amended or the provisions hereof waived with the written consent of the
Company and the Majority Holders, provided that no such Warrant may be
modified or amended to reduce the number of shares of Common Stock for
which such Warrant is exercisable or to increase the price at which such
shares may be purchased upon exercise of such Warrant (before giving effect
to any adjustment as provided therein) without the prior written consent of
<PAGE>   27
the Holder thereof, provided however, that the foregoing shall not limit the
operation of Section 4.6.

     14.6. SEVERABILITY. Wherever possible, each provision of this Warrant
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Warrant shall be prohibited by
or invalid under applicable law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Warrant.

     14.7. HEADINGS. The headings used in this Warrant are for the
convenience of reference only and shall not, for any purpose, be deemed a
part of this Warrant.

     14.8. GOVERNING LAW. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT
TO THE PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE EXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED
STATES OF AMERICA, IN EACH CASE LOCATED IN THE COUNTY OF NEW YORK, FOR ANY
ACTION, PROCEEDING OR INVESTIGATION IN ANY COURT OR BEFORE ANY GOVERNMENTAL
AUTHORITY ("LITIGATION") ARISING OUT OF OR RELATING TO THIS WARRANT AND THE
TRANSACTIONS CONTEMPLATED HEREBY (AND AGREES NOT TO COMMENCE ANY LITIGATION
RELATING THERETO EXCEPT IN SUCH COURTS), AND FURTHER AGREES THAT SERVICE OF
ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT BY U.S. REGISTERED MAIL TO ITS
RESPECTIVE ADDRESS SET FORTH IN THIS WARRANT SHALL BE EFFECTIVE SERVICE OF
PROCESS FOR ANY LITIGATION BROUGHT AGAINST IT IN ANY SUCH COURT. EACH OF
THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY
OBJECTION TO THE LAYING OF VENUE OF ANY LITIGATION ARISING OUT OF THIS
WARRANT OR THE TRANSACTIONS CONTEMPLATED HEREBY IN THE COURTS OF THE STATE
OF NEW YORK OR THE UNITED STATES OF AMERICA, IN EACH CASE LOCATED IN THE
COUNTY OF NEW YORK, AND HEREBY FURTHER IRREVOCABLY AND UNCONDITIONALLY
WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH
LITIGATION BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. EACH OF THE PARTIES IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHTS TO TRIAL BY
JURY IN CONNECTION WITH ANY LITIGATION ARISING OUT OF OR RELATING TO THIS
WARRANT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

          IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed by an officer thereunto duly authorized.

Dated:
       -----------------

                                        BIO-PLEXUS, INC.

                                        By:
                                           ---------------------------
                                           Name:
                                           Title:
<PAGE>   28
                                    EXHIBIT A

                                SUBSCRIPTION FORM

                 [To be executed only upon exercise of Warrant]

                      Net Issue Exercise _____No ______Yes

          The undersigned registered owner of this Warrant irrevocably
exercises this Warrant for the purchase of _____ shares of Common Stock of
Bio-Plexus, Inc. and herewith makes payment therefor, all at the price and
on the terms and conditions specified in this Warrant and requests that
certificates for the shares of Common Stock hereby purchased (and any
securities or other property issuable upon such exercise) be issued in the
name of and delivered to _____________ whose address is ________________
and, if such shares of Common Stock shall not include all of the shares of
Common Stock issuable as provided in this Warrant, that a new Warrant of
like tenor and date for the balance of the shares of Common Stock issuable
hereunder be delivered to the undersigned.

                                        -----------------------------------
                                        (Name of Registered Owner)

                                        -----------------------------------
                                        (Signature of Registered Owner)

                                        -----------------------------------
                                        (Street Address)

                                        -----------------------------------
                                        (City)   (State)         (Zip Code)

NOTICE:   The signature on this subscription must correspond with the name
          as written upon the face of the within Warrant in every
          particular, without alteration or enlargement or any change
          whatsoever.
<PAGE>   29
                                    EXHIBIT B

                                 ASSIGNMENT FORM

          FOR VALUE RECEIVED the undersigned registered owner of this
Warrant hereby sells, assigns and transfers unto the Assignee named below
all of the rights of the undersigned under this Warrant, with respect to
the number of shares of Common Stock set forth below:

Name and Address of Assignee               No. of Shares of Common Stock
----------------------------               -----------------------------

and does hereby irrevocably constitute and appoint ________________
attorney-in-fact to register such transfer on the books of BIO-PLEXUS, INC.
maintained for the purpose, with full power of substitution in the
premises.

Dated:                               Print Name:
      ------------------                        ----------------------------
                                     Signature:
                                               -----------------------------
                                     Witness:
                                             -------------------------------

NOTICE:   The signature on this assignment must correspond with the name as
          written upon the face of the within Warrant in every particular,
          without alteration or enlargement or any change whatsoever.<PAGE>   1
                                                                   EXHIBIT 10.40

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES
LAWS OF ANY STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF
SUCH ACT OR SUCH LAWS.

                                BIO-PLEXUS, INC.

                                15% SECURED NOTE

No. R-1                                       Dated as of January 5, 2000

$1,650,000

FOR VALUE RECEIVED, the undersigned, BIO-PLEXUS, INC. (herein called the
"Company"), a corporation organized and existing under the laws of the State of
Connecticut, hereby unconditionally promises to pay to the order of Appaloosa
Investment Limited Partnership I, or its registered assigns (the "Holder"), the
principal sum of ONE MILLION SIX HUNDRED FIFTY THOUSAND
<PAGE>   2
DOLLARS ($1,650,000) in immediately available lawful money of the United States
of America, together with interest on the unpaid balance hereof, in accordance
with the terms and conditions set forth below.

     1.   Payment.

          1.1. Principal. The entire unpaid principal balance of this Note
shall be paid in full by the Company on the Due Date.

          1.2. Home Office Payment. The Company will pay to each Holder or any
transferee thereof all sums becoming due on this Note at the account/address to
be specified by such Holder or transferee for such purpose by notice to the
Company, by wire transfer of immediately available funds, or at such other
address or by such other method as such Holder or transferee shall have
designated by notice to the Company.

          1.3. Prepayment. After all amounts owed under the 7.5% Secured Note
issued by the Company to the Holder on October 21, 1999 (as amended from time to
time, the "7.5% Note") have been repaid in full, subject to Section 8.8, (i)
upon at least ten days prior notice to the Holder, this Note may be prepaid,
without premium or penalty, in whole or in part by the Company at any time and
from time to time and (ii) concurrently with the receipt of any proceeds
received by the Company in respect of any sale of Debentures pursuant to section
1.4 of the Subscription Agreement, the Company shall make a mandatory prepayment
of the Note in an amount equal to 100% of such proceeds; provided, that, upon
any prepayment under (i) or (ii) above, all accrued and unpaid interest shall be
paid on the principal of the Note being repaid.

          1.4. Interest. The unpaid principal balance of this Note outstanding
at any time shall accrue interest, at a rate per annum equal to 15% (including
during the pendency of any bankruptcy or similar proceeding, whether or not a
claim for post-petition interest is allowed as a claim in any such bankruptcy or
proceeding). Interest shall begin to accrue from the date hereof and shall be
computed on the basis of a year of 360 days and actual days elapsed and shall be
payable in one lump sum on the Due Date.

          1.5. Default Interest. If the Company shall fail to pay any principal
amount of, or interest on, or other amount payable under, this Note when due and
payable (whether at the Due Date, the Acceleration Date or otherwise), such
principal amount, interest or other amount shall thereafter bear interest, until
paid in full (after as well as before judgment) to the extent lawful, at a rate
per annum equal to 15% (including during the pendency of any bankruptcy or
similar proceeding, whether or not a claim for post-petition interest is allowed
as a claim in any such bankruptcy or proceeding). The Company shall pay such
default interest in
<PAGE>   3
cash on demand from time to time.

          1.6. Limitation on Interest. No provision of this Note shall require
the payment or permit the collection of interest in excess of the maximum rate
which is permitted by Law. If any such excess interest is provided for herein,
or shall be adjudicated to be so provided for, then the Company shall not be
obligated to pay such interest in excess of the maximum rate permitted by Law,
and the right to demand payment of any such excess interest is hereby waived,
any other provisions in this Note to the contrary notwithstanding.

          1.7. Allocation. The parties hereto agree that the fair market value
of this Note is $1,600,000 and the fair market value of the warrants to be
issued to one or more Affiliates of the Holder on the Maturity Date pursuant to
the section (c) of the side letter, dated December 30, 1999, between the Company
and the Holder is $50,000. Each party agrees to file all tax returns consistent
with such allocation and to take no position inconsistent with such allocation,
unless required by Law.

     2. Deliveries by the Company. Simultaneously with the execution of this
Note, the Company is delivering to the Holder the following:

          (a) an opinion of the Company's counsel, dated as of the date hereof,
addressed to such Holder in the form of Exhibit 2(a) hereto;

          (b) a good standing certificate for the Company, dated no earlier than
seven days prior to the date hereof, from the State of Connecticut;

          (c) a copy of the resolutions of the Board of Directors authorizing
the execution of each of the Transaction Documents and the performance of the
transactions contemplated by the Transaction Documents which shall be certified
as true, correct and effective as of the date hereof by an officer of the
Company; and

          (d) the Holder's costs and expenses (including the reasonable fees and
expenses of its counsel, Fried, Frank, Harris, Shriver & Jacobson, in an
aggregate amount not to exceed $100,000 which amounts shall be deducted from the
proceeds of this Note and shall be wired transferred by the Holder, on behalf of
the Company, to one or more accounts designated by such party on or prior to the
date hereof) incurred in connection with the transactions contemplated hereby.

     3. Representations and Warranties of the Company. The Company represents
and warrants to the Holder as follows:

          3.1. Organization; Subsidiaries. (a) The Company is a corporation duly
organized and existing in good standing under the laws of the State of
Connecticut and has the corporate power to own its property and to carry on its
business as now being conducted. The Company is duly qualified as a foreign
corporation to do business and is in good standing in every jurisdiction in
which the nature of the business conducted or property
<PAGE>   4
owned by it makes such qualification necessary and where the failure to so
qualify could, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect.

          (b) The Company does not have any Subsidiaries. Except as set forth on
Schedule 3.1(b), the Company does not own, directly or indirectly, or have the
right or obligation to acquire, any interest in any business association or
other Person.

          3.2. Due Authorization. (a) The Company has all right, power and
authority to enter into, deliver and perform the Transaction Documents to which
it is a party and to consummate the transactions contemplated thereby. The
execution and delivery of each Transaction Document by the Company and the
performance by it of the transactions contemplated thereby (including, without
limitation, the issuance and sale of this Note) and compliance by the Company
with all the provisions of each Transaction Document (as applicable) has been
duly authorized by all requisite corporate proceedings on the part of the
Company. Each of the Transaction Documents has been duly executed and delivered
on behalf of the Company, and each such Transaction Document constitutes the
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its respective terms, except to the extent that such
enforceability (i) may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to creditors' rights generally or (ii)
is subject to general principles of equity.

          (b) The Board of Directors has taken all necessary action so that no
"fair price," "moratorium," "control share acquisition," "interested holder" or
other similar anti-takeover statute or regulation (including, without
limitation, Sections 33-840 through 33-845 of the Connecticut Business
Corporation Act) or any applicable anti-takeover provision in the Company's
Certificate of Incorporation or By-Laws is applicable to the transactions
contemplated by the Transaction Documents. To the knowledge of the Company, no
other state takeover statute is applicable to the transactions contemplated by
the Transaction Documents.

          3.3. Capitalization. The authorized capital stock of the Company
consists of (i) 25,000,000 shares of Common Stock, of which, as of the date
hereof, 14,004,239 shares were issued and outstanding, 579,650 shares were
reserved for issuance upon the exercise of outstanding stock options pursuant to
the Company's option plans, 3,957,588 shares were reserved for issuance upon the
exercise of the outstanding warrants, and 2,111,880 shares were reserved for
issuance upon the conversion of certain 6% Convertible Debentures due 2004 and
(ii) 3,000,000 shares of Preferred Stock, no par value (the "Preferred Stock"),
of which, as of the date hereof, no shares were issued and outstanding. All of
the outstanding shares of Common Stock are validly issued and are fully paid and
nonassessable. No class of Capital Stock of the Company is entitled to
preemptive rights. Except as set forth on Schedule 3.3, there are no
<PAGE>   5
outstanding options, warrants, preemptive rights, subscription rights, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, shares of any class of Capital Stock of the Company, or
Contracts, by which the Company is or may become bound to issue additional
shares of its Capital Stock or options, warrants or other rights to purchase or
acquire any shares of its Capital Stock. Except as set forth on Schedule 3.3, no
warrants, bonds, debentures, notes or other Indebtedness or other security
having the right to vote (or convertible into or exercisable for securities
having the right to vote) on any matters on which stockholders may vote were
issued or outstanding. Except as set forth on Schedule 3.3 or as contemplated by
the Transaction Documents, the Company is not a party to, and, to the Company's
best knowledge, there are, and immediately after the Closing, there will be, no
agreement, restriction or encumbrance (such as a preemptive or similar right of
first refusal, right of first offer, proxy, voting agreement, voting trust,
registration rights agreement, shareholders' agreement, etc., whether or not the
Company is a party thereto) with respect to the purchase, sale or voting of any
shares of Capital Stock of the Company (whether outstanding or issuable upon
conversion, exchange or exercise of outstanding securities) or other securities
of the Company pursuant to any provision of Law, the Certificate of
Incorporation or By-Laws, any agreement or otherwise. Except as set forth on
Schedule 3.3, no person has the right to nominate or elect one or more directors
of the Company. Immediately following the transactions contemplated hereby, the
Company's capitalization will be as set forth on Schedule 3.3. The Company has
not declared or paid any dividend or made any other distribution of cash, stock
or other property to its stockholders since January 1, 1996.

          3.4. SEC Reports Correspondence. The Company has filed all proxy
statements, reports and other documents required to be filed by it under the
Exchange Act from and after January 1, 1995 (collectively, the "SEC Reports").
Each SEC Report was in compliance in all material respects with the requirements
of its respective report form and did not on the date of filing contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, and as of the date
hereof there is no fact or facts not disclosed in the SEC Reports which relate
specifically to the Company and which could, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

          3.5. Financial Statements. The financial statements (including
<PAGE>   6
any related schedules and/or notes) included in the SEC Reports have been
prepared in accordance with GAAP consistently followed (except as indicated in
the notes thereto) throughout the periods involved and fairly present the
consolidated financial condition, results of operations, cash flows and changes
in stockholders' equity of the Company as of the respective dates thereof and
for the respective periods then ended (in each case subject, as to interim
statements, to changes resulting from year-end adjustments, none of which were
material in amount or effect). Except as set forth on Schedule 3.5, the Company
is not subject to any Liabilities, except (i) Liabilities in the respective
amounts reflected or reserved against in the Company's balance sheet as of
December 31, 1998 included in the SEC Reports or (ii) Liabilities incurred in
the ordinary course of business since December 31, 1998 which could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

          3.6. No Material Adverse Change. Since December 31, 1998, no event has
occurred or failed to occur which could, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

          3.7. Intellectual Property Rights. Schedule 3.7 sets forth a complete
and correct list of all Intellectual Property of the Company (the "Company
Intellectual Property"). Except as set forth on Schedule 3.7, the Company owns
and possesses all right, title and interest in, or possesses adequate licenses
to (without the making of any payment to others or the obligation to grant
rights to others in exchange) all the Company Intellectual Property, free and
clear of any Liens, licenses or other restrictions. The Company has the right to
require the applicant of any Company Intellectual Property which is an
application, including but not limited to patent applications, trademark
applications, service mark applications, copyright applications, or mask work
applications, to transfer ownership to the Company of the application and of the
registration once it issues. All registered patents, trademarks, service marks
and copyrights listed on Schedule 3.7 are valid and subsisting and in full force
and effect. The Company Intellectual Property is all the Intellectual Property
that is necessary for the ownership, maintenance and operation of the Company's
properties and assets and the Company has the right to use all of the Company
Intellectual Property in all jurisdictions in which the Company conducts or
proposes to conduct its business, and the consummation of the transactions
contemplated hereby will not alter or impair any such rights. The Company has
never agreed to indemnify any person for or against any interference,
infringement, misappropriation or other conflict with respect to any Company
Intellectual Property. Except as set forth in Schedule 3.7, no third party has
interfered with, infringed upon, misappropriated or otherwise come into conflict
with any Company Intellectual Property. The Company has taken all reasonably
necessary and desirable action to maintain and protect each item of Company
<PAGE>   7
Intellectual Property. The validity, ownership, enforceability, use or legality
of the Company Intellectual Property is not being questioned or opposed in any
Litigation or Order to which the Company or any Person who has granted a license
of Intellectual Property to the Company, is a party or subject, nor, to the
knowledge of the Company, is any such Litigation or Order threatened. The
conduct of the Company as currently conducted and as currently proposed to be
conducted does not and will not infringe, interfere with, misappropriate or
otherwise come into conflict with any Intellectual Property of any other Person,
and the Company has not received any charge, complaint, claim, demand or notice
alleging any such infringement, interference, misappropriation or conflict
(including any claim that the Company must license or refrain from using any
Intellectual Property of any other Person). Except as set forth on Schedule 3.7,
the Company has not granted any licenses of Intellectual Property to any Person.

          3.8. Existing Indebtedness; Future Liens. (a) Schedule 3.8 sets forth
a complete and correct list of all outstanding Indebtedness of the Company as of
the date hereof. Except as set forth on Schedule 3.8, the Company has not
defaulted and no waiver of default is currently in effect, in the payment of any
principal or interest on any such Indebtedness and no event or condition exists
with respect to any such Indebtedness that would permit (or that with notice or
the lapse of time, or both, would permit) one or more Persons to cause such
Indebtedness to become due and payable before its stated maturity or before its
regularly scheduled dates of payment. The Company has not received any notice
from any Person declaring or threatening to declare any Indebtedness owed by the
Company to such Person due and payable prior to the stated maturity of such
Indebtedness or before its regularly scheduled dates of payment.

               (b) The Company has not agreed or consented to cause or permit in
the future (upon the happening of a contingency or otherwise) any of its
property, whether now owned or hereafter acquired, to be subject to any Lien
(other than Permitted Liens).

          3.9. Litigation. (a) Except as set forth on Schedule 3.9, there is no
Litigation pending or, to the knowledge of the Company, threatened against the
Company or any of its properties or assets by or before any court, arbitrator or
other Governmental Entity.

          (b) The Company is not in default under or in breach of any Order of
any court, arbitrator or other Governmental Entity, and the Company is not
subject to or a party to any Order of any court, arbitrator or other
Governmental Entity arising out of any claim, demand, notice, action, suit or
proceeding under any Law.

          3.10. Compliance with Laws. The Company is in compliance with all
applicable Laws including, without limitation, all rules, regulations
<PAGE>   8
and other Laws of the Food and Drug Administration relating to the design,
development, manufacturing, sales and distribution of safety medical products
and accessories, except where the failure to comply could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect. No
Order has been issued nor any Law enacted which prevents, nor does any Law
prohibit the consummation of the transactions contemplated by any of the
Transaction Documents.

          3.11. Offering of the Securities. In connection with the offering of
this Note, neither the Company nor any Person acting on its behalf has offered
the Note, or any similar securities of the Company for sale to, solicited any
offers to buy the Note, or any similar securities of the Company from or
otherwise approached or negotiated with respect to the Company with any Person
other than the Purchasers and other "accredited investors" (as defined in Rule
501(a) under the Securities Act). Neither the Company nor any Person acting on
its behalf has taken or, except as contemplated hereby will take any action
(including, without limitation, any offering of any securities of the Company
under circumstances which would require the integration of such offering with
the offering of the Note under the Securities Act) which could reasonably be
expected to subject the offering, issuance or sale of the Note and the Warrants
to the registration requirements of Section 5 of the Securities Act or violate
the provisions of any securities, "blue sky", or similar law of any applicable
jurisdiction.

          3.12. Solvency. The Company is not, and after giving effect to the
issuance of this Note and the application of the proceeds therefrom will not be,
insolvent within the meaning of Title 11 of the United States Code or any
comparable state law provision.

          3.13. Security Documents. Except as set forth in Schedule 3.13, upon
proper filing of the Financing Statements (or assignments thereof) in the
offices of the Secretary of State of Connecticut with respect to the Company (or
assignments thereof) and in the locations identified in the Security Agreement,
the Liens granted under the Transaction Documents shall constitute a fully
perfected first priority security interest in all right, title and interest of
the Company in and to the personal property therein prior to any other security
interests against such property or interests therein.

          3.14. Disclosure. Neither any Transaction Document nor any Schedule
hereto and thereto, nor any certificate furnished to any Holder by or on behalf
of the Company in connection with the transactions contemplated hereby and
thereby, contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements contained herein and
therein not misleading. The financial forecasts furnished by the Company to the
Holder has been prepared in good faith based upon reasonable assumptions. There
is no fact or information
<PAGE>   9
relating to the Company that could reasonably be expected to be material to the
Company that has not been disclosed to the Holder.

     4. Covenants of the Company. The Company covenants that for so long as this
Note is outstanding or any amounts are due and unpaid hereunder:

          4.1. Limitation on Indebtedness. The Company shall not, and shall not
permit any of its Subsidiaries to, create, incur, assume or directly or
indirectly guarantee or in any other manner become directly or indirectly liable
for the payment of any Indebtedness (excluding Permitted Indebtedness and
Indebtedness which is a Guaranty of an Indebtedness of the Company or any of its
Subsidiaries that is otherwise Permitted Indebtedness).

          4.2. Limitation on Encumbrances. The Company shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, create, incur, assume
or otherwise suffer to exist or cause or otherwise suffer to become effective
any Lien in or on any right, title or interest to any property (real or
personal) that constitutes all or any portion of the Collateral (a "Restricted
Encumbrance," which term excludes the Lien created in favor of the Holder)
unless such Restricted Encumbrance is a Permitted Lien.

          4.3. Limitation on Dividends; Stock Issuances. The Company shall not
offer or issue any shares of Preferred Stock or Common Stock for any purpose
whatsoever, except pursuant to Schedule 4.3. The Company shall not declare any
dividends on any shares of its Capital Stock, or make any payment on account of,
or set apart assets for a sinking or other analogous fund for, the purchase,
redemption, retirement, exchange or other acquisition of any shares of its
Capital Stock, whether now or hereafter outstanding, or make any other
distribution in respect thereof, either directly or indirectly, whether in cash,
securities, property or in obligations of the Company or any of its
Subsidiaries.

          4.4. Stockholders' Meetings. As promptly as practicable hereafter but
in no event no later than February 28, 2000, the Company shall take all action
necessary, in accordance with applicable Law and its Certificate of
Incorporation and By-laws, to convene a special meeting of its stockholders (the
"Company Meeting") for the purpose of considering and voting upon the approval
of the Rollover Transactions, including, without limitation, the issuance and
sale of the Convertible Notes, the Shares and the Rollover Warrants, and any
other transactions contemplated in furtherance thereof under applicable Law;
provided, however, that the Company shall adjourn the Company Meeting from time
to time until all of the conditions set forth in Section 6.2 are satisfied or
waived (other than those conditions that by their nature are to be satisfied on
the Rollover Date), such that the
<PAGE>   10
Company Meeting shall take place on the same day as the Rollover Date in
accordance with Section 6.1. The Company will use its best efforts to obtain
such stockholders' approval, including, without limitation, taking all lawful
actions to solicit such approval. The Board of Directors will recommend that its
stockholders vote in favor of and approve the Rollover Transactions, including,
without limitation, the issuance and sale of the Convertible Notes, the Shares
and the Rollover Warrants, and any other transactions contemplated in
furtherance thereof under applicable Law.

          4.5. Proxy Statement. The Proxy Statement shall comply as to form in
all material respects with the applicable provisions of the Exchange Act and the
rules and regulations thereunder. The Company shall use its best efforts, and
the Holder will cooperate with the Company, to have the Proxy Statement cleared
by the SEC as promptly as practicable. The Company shall, as promptly as
practicable, provide copies of any written comments received from the SEC with
respect to the Proxy Statement to the Holder and advise the Holder of any oral
comments with respect to the Proxy Statement received from the SEC. The Holder
agrees that none of the information supplied or to be supplied by it for
inclusion or incorporation by reference in the Proxy Statement and each
amendment or supplement thereto, at the time of mailing thereof and at the time
of the Company Meeting, will contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. The Company agrees that none of the information supplied
or to be supplied by the Company for inclusion or incorporation by reference in
the Proxy Statement and each amendment or supplement thereto, at the time of
mailing thereof and at the time of the Company Meeting, will contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Company will
provide the Holder with a reasonable opportunity to review and comment on the
Proxy Statement and any amendment or supplement thereto prior to filing such
with the SEC, and will provide the Holder with a copy of all such filings made
with the SEC. No amendment or supplement to the information supplied by the
Holder for inclusion in the Proxy Statement shall be made without the approval
of such Holder, which approval shall not be unreasonably withheld or delayed.

          4.6. Operations in Accordance with the Business Plan. The business and
operations of the Company and its Subsidiaries shall be conducted in accordance
with a business plan of the Company approved by the
<PAGE>   11
Holder.

          4.7. Proceeds. The proceeds of the sale of this Note shall be used for
the purposes set forth on Schedule 4.7. No part of the proceeds from the sale of
this Note hereunder shall be used, directly or indirectly, for the purpose of
"purchasing" or "carrying" any "margin stock" within the respective meanings of
Regulation U of the Board of Governors of the Federal Reserve System or for any
purpose which violates or would be inconsistent with the provisions of
Regulations T, U or X of said Board.

          4.8. Additional Offerings of Securities. The Company shall not seek
financing from any third party consisting of an issuance of Equity Securities
without the written consent of the Holder (which may be withheld at the Holder's
absolute discretion).

          4.9. Existence. Neither the Company nor any of its Subsidiaries shall
enter into any transaction for the acquisition of, or merger or consolidation or
amalgamation with, any other Person (including any Subsidiary or Affiliate of
the Company or any of its Subsidiaries), or enter into any transaction or series
of transactions that could result in a Change of Control, or sell, transfer or
otherwise dispose of ("Transfer") all or substantially all of its assets in one
transaction or series of transactions to any Person, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), or make any material
change in the present method of conducting business or engage in any type of
business other than of same general type now conducted by it. The Company shall
not, and shall not permit any of its Subsidiaries to, Transfer any property or
assets, unless the property or asset that is the subject of such Transfer
constitutes (i) inventory held for sale, (ii) marketable securities available
for sale, or (iii) real estate, equipment, fixtures, supplies or materials no
longer required in the operation of the business of the Company or such
Subsidiary or that is obsolete, and, in the case of any Transfer described in
clause (i) or (iii), such Transfer is in the ordinary course of business
consistent with past practice.

          4.10. Access. Subject to a written confidentiality agreement, the
Company shall, and shall cause the Company's officers, directors, employees and
agents to, afford to the Holder and each of its Affiliates, officers, directors,
employees, counsel, investment bankers, accountants, advisors, agents and other
representatives (collectively, "Representatives"), reasonable access during
normal business hours to its officers, employees, accountants, agents,
properties, offices and other facilities, and to the books and records of the
Company (including, without limitation, all interim financial statements, tax
returns and work papers of its accountants), legal documents of the Company, and
shall furnish the Holder and its Representatives all financial, operating,
technical and other
<PAGE>   12
data and information which any of them may from time to time reasonably request.

          4.11. 6% Convertible Debentures due 2004. The Company shall not
exercise its Put Option without the written consent of the Holder.

          4.12. Security. The Secured Obligations will be secured by the
Collateral, subject to the terms and conditions of the Collateral
Documentation.

     5. Events of Default and Remedies.

          5.1. Events of Default and Remedies. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any Order of any court or any Order, rule or
regulation of any Governmental Entity) (or if the giving of notice or lapse of
time or both is required, then, prior to such notice or lapse of time, a
"Default"):

               (a) default in the payment of any interest upon this Note
     when it becomes due and payable; or

               (b) default in the payment of any principal of this Note when it
     becomes due and payable; or

               (c) default in the performance of any agreement or covenant in,
     or provision of, this Note or the other documents executed and delivered in
     connection with this Note (including any other Transaction Document) and to
     which the Company or any of its Subsidiaries is a party (other than a
     covenant or a default in whose performance is elsewhere in this Section
     specifically dealt with) which is not cured within thirty (30) days, or any
     representation or warranty made in any document executed and delivered in
     connection with this Note (including any other Transaction Document) was
     false in any material respect on the date as of which made or deemed made;
     or

               (d) the Company Meeting shall not have been held on or prior to
     February 28, 2000 or the approval of the Company's stockholders described
     in Section 4.4 shall not have been obtained at the Company Meeting on or
     prior to February 28, 2000; or

               (e) the Company or any of its Subsidiaries shall: (A) default in
     any payment of principal of or interest on any Indebtedness (other than
     this Note and any intercompany debt) or in the payment of any Guarantee,
     beyond the period of grace, if any, provided in the instrument or agreement
     under which such Indebtedness or Guarantee was
<PAGE>   13
     created; or (B) default in the observance or performance of any other
     agreement or condition relating to any such Indebtedness or Guarantee or
     contained in any instrument or agreement evidencing, securing or relating
     thereto, or any other event shall occur or condition exist, the effect of
     which default or other event or condition is to cause, or to permit the
     holder or holders of such Indebtedness or beneficiary or beneficiaries of
     such Guarantee (or a trustee or agent on behalf of such holder or holders
     or beneficiary or beneficiaries) to cause, with the giving of notice if
     required, such Indebtedness to become due prior to its stated maturity, any
     applicable grace period having expired, or such Guarantee to become
     payable, any applicable grace period having expired, provided that the
     aggregate principal amount of all such Indebtedness and Guarantee which
     would then become due or payable as described in this Section 5.1(e) would
     equal or exceed $100,000; or

               (f) a final judgment or judgments for the payment of money are
     entered by a court or courts of competent jurisdiction against the Company
     or any of its Subsidiaries and such remains undischarged for a period
     (during which execution shall not effectively be stayed) of 60 days,
     provided that the aggregate of all such judgments that are not covered by
     insurance under which the Company or a Subsidiary is a beneficiary exceeds
     $100,000, or the Holder shall determine that any regulatory body having
     jurisdiction over the Company or any of its Subsidiaries including, without
     limitation, the SEC, shall have taken or proposed to take any action that
     the Holder believes could, individually or in the aggregate, reasonably be
     expected to have a Material Adverse Effect or that adversely affects the
     Holder's security interest in the Collateral; or

               (g) the Company or any of its Subsidiaries (i) is generally not
     paying, or admits in writing its inability to pay, its debts as they become
     due, (ii) files, or consents by answer or otherwise to the filing against
     it of, a petition for relief or reorganization or arrangement or any other
     petition in bankruptcy, for liquidation or to take advantage of any
     bankruptcy, insolvency, reorganization, moratorium or other similar law of
     any jurisdiction, (iii) makes an assignment for the benefit of its
     creditors, (iv) consents to the appointment of a custodian, receiver,
     trustee or other officer with similar powers with respect to it or with
     respect to any substantial part of its property, (v) is adjudicated as
     insolvent or to be liquidated, or (vi) takes corporate action for the
     purpose of any of the foregoing; or

               (h) a court or other Governmental Entity of competent
<PAGE>   14
     jurisdiction enters an Order appointing, without consent by the Company or
     any of its Subsidiaries, a custodian, receiver, trustee or other officer
     with similar powers with respect to it or with respect to any substantial
     part of its property, or constituting an order for relief or approving a
     petition for relief or reorganization or any other petition in bankruptcy
     or for liquidation or to take advantage of any bankruptcy or insolvency law
     of any jurisdiction, or ordering the dissolution, winding-up or liquidation
     of the Company or any of its Subsidiaries, or any such petition shall be
     filed against the Company or any of its Subsidiaries and such petition
     shall not be dismissed within 60 days; or

               (i) a court or other Governmental Entity of competent
     jurisdiction enters a final judgment holding this Note or any of the
     documents delivered in connection with this Note (including any other
     Transaction Document) to be invalid or unenforceable and such judgment
     remains unstayed and in effect for a period of 20 consecutive days; or the
     Company or any of its Subsidiaries shall assert, in any pleading filed in
     such a court, that this Note or any of the documents delivered in
     connection with this Note (including any other Transaction Document) are
     invalid or unenforceable; or

               (j) any material provision of any Transaction Document shall for
     any reason cease to be valid, binding and enforceable in accordance with
     its terms (or the Company or any of its Subsidiaries shall challenge the
     enforceability of any Transaction Document or shall assert in writing, or
     engage in any action or inaction based on any such assertion, that any
     provision of any of the Transaction Documents has ceased to be or otherwise
     is not valid, binding and enforceable in accordance with its terms), or any
     first priority security interest created under any Transaction Document
     shall cease to be a valid and perfected security interest, or Lien in any
     of the Collateral purported to be covered thereby; or

               (k) the Company or any of its Subsidiaries shall default in the
     payment of any amounts due pursuant to the terms of any document executed
     and delivered by the Company or such Subsidiary in connection with this
     Note (other than payments elsewhere in this Section specifically dealt
     with).

          5.2. Acceleration of Maturity. If any Event of Default (other than an
Event of Default specified in clause (g), (h), (i) or (j) of Section 5.1) shall
have occurred and be continuing, the Holder may, by notice to the Company,
declare the entire unpaid principal amount of this Note, plus all accrued and
unpaid interest thereon (together with the Holder's costs and expenses pursuant
to Section 8.8), to be immediately
<PAGE>   15
due and payable, and upon such declaration all of such amount shall be
immediately due and payable (the "Declared Acceleration Date"), in each and
every case without presentment, demand, protest or further notice, all of which
are hereby waived, anything in this Note to the contrary notwithstanding;
provided that if an Event of Default under clause (g), (h), (i) or (j) of
Section 5.1 shall have occurred, the entire unpaid principal amount of this Note
(to the full extent permitted by applicable Law), plus all accrued and unpaid
interest thereon (together with the Holder's costs and expenses pursuant to
Section 8.8), shall immediately become due and payable (the "Automatic
Acceleration Date"), without any declaration and without presentment, demand,
protest or further notice, all of which are hereby waived, anything in this Note
to the contrary notwithstanding.

          5.3. Other Remedies. If any Event of Default shall have occurred and
be continuing, from and including the date of such Event of Default to but not
including the date such Event of Default is cured or waived, each Holder may
enforce its rights by suit in equity, by action at law, or by any other
appropriate proceedings, whether for the specific performance (to the extent
permitted by Law) of any covenant or agreement contained in this Note or in aid
of the exercise of any power granted in this Note, and each Holder may enforce
the payment of any Note held by such Holder and any of its other legal or
equitable rights.

          5.4. Conduct; No Waiver; Collection Expenses. No course of dealing on
the part of the Holder, nor any delay or failure on the part of the Holder to
exercise any of its rights, shall operate as a waiver of such right or otherwise
prejudice the Holder's rights, powers and remedies. If the Company fails to pay,
when due, any payment in respect of this Note, the Company will pay such Holder,
to the extent permitted by Law, on demand, all costs and expenses incurred by
such Holder in the collection of any amount due in respect of this Note
hereunder, including reasonable legal fees incurred by such Holder in enforcing
its rights hereunder.

          5.5. Annulment of Acceleration. If a declaration is made in accordance
with Section 5.2, then and in every such case, the Holder may, by an instrument
delivered to the Company, annul such declaration and the consequences thereof.

          5.6. Remedies Cumulative. No right or remedy conferred upon or
reserved to the Holder under this Note is intended to be exclusive of any other
right or remedy, and every right and remedy shall be cumulative and in addition
to every other right and remedy given hereunder or now and hereafter existing
under applicable Law. Every right and remedy given by this Note or by applicable
Law to the Holder may be exercised from time to
<PAGE>   16
time and as often as may be deemed expedient by such Holder.

     6.   Rollover

          6.1. Rollover. On the same day that the stockholders' approval
referred to in Section 4.4 has been obtained (the "Rollover Date"), subject to
Section 6.2, the Company and the Purchasers shall enter into (i) the Convertible
Note Purchase Agreement attached hereto as Exhibit 6.1(i) (the "Convertible Note
Purchase Agreement"), (ii) warrants to purchase 1,500,000 shares of Common Stock
at an exercise price of $7 attached hereto as Exhibit 6.1(ii) (the "Rollover
Warrant"), (iii) the Registration Rights Agreement attached hereto as Exhibit
6.1(iii) (the "Rollover Registration Rights Agreement") and (iv) the Convertible
Note Security Agreement attached hereto as Exhibit 6.1(iv) (the "Convertible
Note Security Agreement"); provided, however, that if a Governmental Entity
shall determine that any of the transactions contemplated by the Rollover
Transactions violate any applicable rules or regulations of such Governmental
Entity, the Holder shall, at the Holder's sole discretion, either (i) abandon
the Rollover Transactions or (ii) modify the structure of the Rollover
Transactions in a manner to comply with such rule or regulation.

          6.2. Conditions to Rollover. (a) The obligation of each party to
consummate the Rollover Transactions shall be subject to there having been no
enactment, issuance, promulgation, enforcement or entering into of any Law by a
Governmental Entity that effects or has the effect of making any of the Rollover
Transactions illegal or otherwise restraining or prohibiting such transactions.

               (b) The obligation of the Purchasers to consummate the Rollover
Transactions shall be subject to the following conditions:

                    (i) no change (or any condition, event or development
          involving a prospective change) shall have occurred or be threatened
          that could, individually or in the aggregate, reasonably be expected
          to have a Material Adverse Effect;

                    (ii) no Default shall have occurred and be continuing under
          this Note and no Default (as defined in the 7.5% Secured Note) shall
          have occurred and be continuing under the 7.5% Secured Note;

                    (iii) concurrently with the consummation of the Rollover
          Transactions, the principal amount of this Note (plus all accrued and
          unpaid interest on this Note) and the 7.5% Secured Note (plus all
          accrued and unpaid interest on the 7.5% Secured Note) shall have been
          repaid in full;

                    (iv) the Company shall have delivered to the Purchasers any
          document, instrument or certificate required to be delivered by the
          Company pursuant to the Rollover Transaction Documents;
<PAGE>   17
          and

                    (v) each Purchaser shall have received such other
          instruments and documents reasonably requested by such Purchaser.

               (c) The obligation of the Company to consummate the Rollover
Transactions shall be subject to the delivery by each Purchaser to the Company
of any document, instrument or certificate required to be delivered by such
Purchaser pursuant to the Rollover Transaction Documents.

          6.3. Failure to Consummate the Rollover Transactions. Notwithstanding
anything herein to the contrary, if the Company shall fail to consummate the
Rollover Transactions described in Section 6.1 for any reason whatsoever, then
the Company's sole liability to the Holder will be the: (i) payment of the
Holder's costs and, in each case, expenses pursuant to Section 8.8; (ii) payment
of principal and interest under this Note and the 7.5% Note (and, in each case,
default interest, if applicable); and (iii) execution of the Registration Rights
Agreement by the Company pursuant to Section 6.4.

          6.4. Registration Rights Agreement. In the event the approval of the
Company's stockholders described in Section 4.4 shall not have been obtained at
the Company Meeting on or prior to February 28, 2000, or in the event that the
Rollover Transactions shall not have occurred on or prior to the Rollover Date,
the Company shall immediately execute the Registration Rights Agreement attached
hereto as Exhibit 6.4 (the "Registration Rights Agreement") and deliver such
executed Registration Rights Agreement by fax to the Holder.

     7.   Interpretation.

          7.1. Definitions.

          "7.5% Note" shall have the meaning ascribed thereto in Section
1.3.

          "Acceleration Date" shall mean the Declared Acceleration Date or the
Automatic Acceleration Date, as the case may be.

          "Action" shall have the meaning ascribed thereto in Section
8.1(b)(i).

          "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under
the Exchange Act. "Affiliate" shall also include partners of a Person.
Notwithstanding the foregoing, "Affiliate" shall not include the limited
partners of the Holder or any limited partners of a limited partner
<PAGE>   18
of the Holder.

          "Automatic Acceleration Date" shall have the meaning ascribed thereto
in Section 5.2.

          "Board of Directors" shall mean the Board of Directors of the
Company.

          "Business Day" shall mean any day other than a Saturday, Sunday, or a
day on which banking institutions in the State of New York are authorized or
obligated by Law or executive order to close.

          "Capital Stock" means, in the case of the Company, any and all shares
(however designated) of the capital stock of the Company now or hereafter
outstanding.

          "Capitalized Lease" shall mean, with respect to any Person, any lease
or any other agreement for the use of property which, in accordance with
generally accepted accounting principles, should be capitalized on the lessee's
or user's balance sheet.

          "Capitalized Lease Obligation" of any Person shall mean and include,
as of any date as of which the amount thereof is to be determined, the amount of
the liability capitalized or disclosed (or which should be disclosed) in a
balance sheet of such Person in respect of a Capitalized Lease of such Person.

          "Change of Control" shall mean

                    (a) the acquisition by any individual, entity or group
          (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange
          Act) of beneficial ownership (within the meaning of Rule 13d-3
          promulgated under the Exchange Act) of 30% or more of the combined
          voting power of the then outstanding Voting Securities of the Company,
          but excluding, for this purpose, any such acquisition by (i) the
          Company or any Subsidiary), (ii) any Benefit Plan (or related trust)
          of the Company or any Subsidiary or (iii) the Holder or any of its
          Affiliates or in connection with the Rollover Transactions; or

                    (b) the Incumbent Board shall cease for any reason to
          constitute at least 50% of the members of the Board.

          "Collateral" means all real and personal property and interests in
real and personal property including, without limitation, Intellectual Property,
rights under leases and royalty rights and agreements, now owned or hereafter
acquired by the Company or its Subsidiaries in or upon which a Lien is granted
or made under the Collateral Documentation.

          "Collateral Documentation" means the Security Agreement, the
<PAGE>   19
Financing Statements, and all other deeds of trust, assignments, endorsements,
pledged stock, collateral assignments and other instruments, documents,
agreements or conveyances at any time creating or evidencing Liens or assigning
Liens to the Holder, to secure the obligations of the Company or any of its
Subsidiaries under this Note and the Registration Rights Agreement.

          "Common Stock" shall mean the Common Stock, no par value, of the
Company.

          "Company" shall have the meaning ascribed thereto in the
Preamble.

          "Company Meeting" shall have the meaning ascribed thereto in
Section 4.4.

          "Contracts" shall mean all agreements, contracts, leases, purchase
orders, arrangements, commitments and licenses to which the Company or any of
its Subsidiaries is a party or by which the Company or any of its Subsidiaries
is bound.

          "Convertible Note Purchase Agreement" shall have the meaning ascribed
thereto in Section 6.1.

          "Convertible Note Security Agreement" shall have the meaning ascribed
thereto in Section 6.1.

          "Debentures" shall have the meaning ascribed thereto in the
Subscription Agreement.

          "Declared Acceleration Date" shall have the meaning ascribed thereto
in Section 5.2.

          "Default" shall have the meaning ascribed thereto in Section 5.1.

          "Due Date" shall mean the earlier of the Maturity Date and the
Acceleration Date, as applicable.

          "Environmental Laws" means any and all Laws, permits, concessions,
grants, franchises, licenses, agreements or governmental restrictions relating
to pollution and the protection of the environment or the release of any
materials into the environment, including but not limited to those related to
hazardous substances or wastes, air emissions and discharges to waste or public
systems.

          "Equity Interests" means any capital stock, partnership interest,
joint venture interest or other equity interest or warrants, options or other
rights to acquire any capital stock, partnership interest, joint venture
interest or other equity interest.

          "Equity Securities" shall mean with respect to any Person, shares of
capital stock or other equity interest of such Person, and any rights, options
or warrants to purchase stock or other securities exchangeable for or
convertible into capital stock of or other equity interest in the Company.
<PAGE>   20
          "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.

          "Event of Default" shall have the meaning ascribed thereto in
Section 5.1.

          "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, or any successor federal statute, and the rules and regulations of the
SEC thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Exchange Act of 1934, as amended, shall
include reference to the comparable section, if any, of any such successor
federal statute.

          "Financing Statements" means Form UCC-1 financing statements filed in
all jurisdictions necessary or desirable in order to perfect the Holder's
security interest in the Collateral and shall include any Form UCC-1 financing
statements assigned to the Holder and filings to be made in the U.S. Patent and
Trademark Office and the U.S. Copyright Office.

          "GAAP" shall mean U.S. generally accepted accounting principles.

          "Governmental Entity" shall mean any supernational, national, foreign,
federal, state or local judicial, legislative, executive, administrative or
regulatory or self-regulatory body or authority.

          "Guaranty" or "Guarantee" by any Person shall mean all obligations
(other than endorsements in the ordinary course of business of negotiable
instruments for deposit or collection) of any Person guaranteeing, or in effect
guaranteeing, any Indebtedness, dividend or other obligation of any other Person
(the "primary obligor") in any manner, whether directly or indirectly,
including, without limitation, all obligations incurred through an agreement,
contingent or otherwise, by such Person: (i) to purchase such Indebtedness or
obligation or any property or assets constituting security therefor, (ii) to
advance or supply funds (x) for the purchase or payment of such Indebtedness or
obligation, (y) to maintain working capital or other balance sheet condition or
otherwise to advance or make available funds for the purchase or payment of such
Indebtedness or obligation, (iii) to lease property or to purchase securities or
other property or services primarily for the purpose of assuring the owner of
such Indebtedness or obligation of the ability of the primary obligor to make
payment of such Indebtedness or obligation, or (iv) otherwise to assure the
owner of the Indebtedness or obligation of the primary obligor against loss in
respect thereof. For the purposes of any computations made under this Note, a
Guarantee in respect of any Indebtedness for borrowed money shall be deemed to
be Indebtedness equal to the outstanding amount of the Indebtedness for borrowed
money which has been guaranteed, and a Guarantee in respect of any other
Liability or any
<PAGE>   21
dividend shall be deemed to be Indebtedness equal to the maximum aggregate
amount of such Liability or dividend.

          "Holder" shall have the meaning ascribed thereto in the Preamble.

          "Incumbent Board" shall mean the individuals who, immediately after
the Closing, constitute the Board of Directors; provided, however, that any
individual becoming a director subsequent to the Closing whose election, or
nomination for election by the Company's stockholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board shall
be deemed to be a member of the Incumbent Board

          "Indebtedness" shall mean, with respect to any Person, (i) all
obligations of such Person for borrowed money, or with respect to deposits or
advances of any kind, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (iii) all obligations of such Person
under conditional sale or other title retention agreements relating to property
purchased by such Person, (iv) all obligations of such Person issued or assumed
as the deferred purchase price of property or services (other than accounts
payable to suppliers and similar accrued liabilities incurred in the ordinary
course of business and paid in a manner consistent with industry practice), (v)
all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any lien or security interest on property owned or acquired by such Person
whether or not the obligations secured thereby have been assumed, (vi) all
Capitalized Lease Obligations of such Person, (vii) all Guarantees of such
Person, (viii) all obligations (including but not limited to reimbursement
obligations) relating to the issuance of letters of credit for the account of
such Person, (ix) all obligations arising out of foreign exchange contracts, and
(x) all obligations arising out of interest rate and currency swap agreements,
cap, floor and collar agreements, interest rate insurance, currency spot and
forward contracts and other agreements or arrangements designed to provide
protection against fluctuations in interest or currency exchange rates.

          "Indemnified Person" shall have the meaning ascribed thereto in
Section 8.1(b).

          "Intellectual Property" means (a) Patents, (b) all trademarks, service
marks, trade dress, logos, trade names, domain names and corporate names,
together with all translations, adaptations, derivations and combinations
thereof and including all goodwill associated therewith, and all applications,
registrations and renewals in connection therewith, (c) all copyrightable works,
all copyrights and all applications, registrations and renewals in connection
therewith, (d) all mask works and all applications, registrations and renewals
in connection therewith, (e)
<PAGE>   22
all trade secrets and confidential business information (including ideas,
research and development, know-how, formulas, compositions, manufacturing and
production processes and techniques, technical data, designs, drawings,
specifications, customer and supplier lists, pricing and cost information and
business and marketing plans and proposals), (f) all computer software
(including data and related documentation), (g) all other proprietary rights,
(h) all copies and tangible embodiments of the foregoing (in whatever form or
medium) and (i) all licenses, sublicenses, permissions or agreements in
connection with the foregoing.

          "Law" shall include any foreign, federal, state, or local law,
statute, rule, regulation, Order or other restriction of any court or other
Governmental Entity.

          "Liability" shall mean any debt, liability or obligation, whether
known or unknown, asserted or unasserted, accrued, absolute, contingent or
otherwise, whether due or to become due.

          "Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).

          "Litigation" shall mean any claim, demand, notice, action, suit,
proceeding, arbitration, investigation, civil, criminal or administrative
action, audit, inquiry or hearing by or before any Governmental Entity or
private arbitration tribunal.

          "Material Adverse Effect" shall mean a material adverse effect on (a)
the properties, business, prospects, operations, earnings, assets, Liabilities
or the condition (financial or otherwise) of the Company and its Subsidiaries
taken as a whole, whether or not in the ordinary course of business, (b) the
ability of the Company or any of its Subsidiaries to perform its obligations
under any of the Transaction Documents to which it is a party, (c) the validity
or enforceability of any of the Transaction Documents, (d) the rights, remedies,
powers and privileges of the Holder under any of the Transaction Documents or
(e) the timely payment or performance of the Secured Obligations.

          "Maturity Date" shall mean the earlier of February 28, 2000 and the
Rollover Date.

          "Order" shall mean any judgment, order, injunction, ruling, decree,
stipulation or award of any Governmental Entity or private
<PAGE>   23
arbitration tribunal.

          "Patents" shall mean, collectively, (a) all inventions (whether
patentable or unpatentable and whether or not reduced to practice) and all
improvements thereon, (b) all patents, patent applications and patent
disclosures, (c) all reissues, divisions, continuations, revisions
reexaminations, renewals, extensions and continuations-in-part thereof) and (d)
all rights, now existing or hereafter coming into existence, (i) to all income,
royalties, damages, and other payments (including in respect of all past,
present and future infringements) now or hereafter due or payable under or with
respect to any of the foregoing, (ii) to sue for all past, present and future
infringements with respect to any of the foregoing and (iii) otherwise accruing
under or pertaining to any of the foregoing throughout the world, including all
inventions and improvements described or discussed in all such patents and
patent applications.

          "Permitted Indebtedness" means, without duplication, any of the
following Indebtedness of the Company or any of its Subsidiaries, as the case
may be: (i) Indebtedness and obligations under this Note; (ii) any Indebtedness
and obligations outstanding on the date hereof, as set forth on Schedule 4.1; or
(iii) Indebtedness incurred in the ordinary course of business and consistent
with past practice not to exceed $10,000 individually or in the aggregate.

          "Permitted Liens" means: (i) Liens existing on the date hereof and set
forth on Schedule 4.2, all of which are subordinate to the Lien of the
Collateral Documentation except as set forth in Schedule 4.2; (ii) Liens (other
than any Lien imposed under ERISA or any Environmental Laws) for taxes,
assessments or charges of any Governmental Entity for claims not yet due or
which are being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted, and with respect to which adequate reserves
or other appropriate provisions are being maintained in accordance with the
provisions of GAAP and enforcement thereof is stayed; (iii) Liens of landlords,
carriers, warehousemen, mechanics, materialmen and other Liens (other than any
Lien imposed under ERISA) not voluntarily granted for amounts not yet due or
which are being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted, and with respect to which adequate reserves
or other appropriate provisions are being maintained in accordance with the
provisions of GAAP, and enforcement thereof is stayed; (iv) Liens (other than
any Lien imposed under ERISA), incurred or deposited made in the ordinary course
of business, including without limitation, surety bonds and appeal bonds, in
connection with workers' compensation, unemployment insurance and other types of
social security benefits or to secure the performance of tenders, bids, leases,
contracts (other than for the repayment of indebtedness), statutory obligations
and other similar
<PAGE>   24
obligations or arising as a result of progress payments under government
contracts; (v) easements (including without limitation reciprocal easement
agreements and utility agreements), rights-of-way, covenants, consents,
reservations, encroachments, variations and other similar restrictions, charges
or encumbrances (whether or not recorded) and other Liens incurred in the
ordinary course of business, which do not secure indebtedness or the deferred
purchase price of any asset and which do not interfere materially with the
ordinary conduct of the business of the Company or any Subsidiary of the Company
and which do not materially detract from the value of the property to which they
attach or materially impair the use thereof to the Company or any Subsidiary of
the Company; and (vi) building restrictions, zoning laws and other statutes,
laws, rules, regulations, ordinances and restrictions, and any amendments
thereto, now or at any time hereafter adopted by any Governmental Entity having
jurisdiction.

          "Person" shall mean any individual, firm, corporation, limited
liability company, partnership, company or other entity, and shall include any
successor (by merger or otherwise) of such entity.

          "Preferred Stock" shall have the meaning ascribed thereto in
Section 3.3.

          "Proxy Statement" shall mean the proxy statement in a definitive form
relating to the Company Meeting.

          "Put Option" shall have the meaning ascribed thereto in the
Subscription Agreement.

          "Purchaser" shall mean the purchasers listed on Exhibit A to the
Convertible Note Purchase Agreement.

          "Registration Rights Agreement" shall have the meaning ascribed
thereto in Section 6.4.

          "Representatives" shall have the meaning ascribed thereto in
Section 4.10.

          "Restricted Encumbrance" shall have the meaning ascribed thereto
in Section 4.2.

          "Rollover Date" shall have the meaning ascribed thereto in
Section 6.1.

          "Rollover Registration Rights Agreement" shall have the meaning
ascribed thereto in Section 6.1.

          "Rollover Transactions" shall mean the transactions contemplated by
Section 6.1 of this Note.

          "Rollover Transaction Documents" shall mean the Convertible Note
<PAGE>   25
Purchase Agreement, the Rollover Warrant, the Rollover Registration Rights
Agreement, the Convertible Note Security Agreement and any documents and
instruments required to be executed or delivered pursuant to any of the
foregoing agreements.

          "Rollover Warrant" shall have the meaning ascribed thereto in
Section 6.1.

          "SEC" shall mean the United States Securities and Exchange
Commission.

          "SEC Reports" shall have the meaning ascribed thereto in Section
3.4.

          "Secured Obligations" shall mean any and all obligations of the
Company or any of its Subsidiaries at any time and from time to time for the
performance of its agreements, covenants and undertakings under or in respect of
the Transaction Documents to which it is a party.

          "Securities Act" shall mean the Securities Act of 1933, as amended, or
any successor federal statute, and the rules and regulations of the SEC
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Act shall include reference to the
comparable section, if any, of such successor federal statute.

          "Security Agreement" shall mean the agreement, dated as of October 21,
1999, between Appaloosa Investment Limited Partnership I, L.P. and the Company,
providing for a security interest in the Collateral.

          "Subscription Agreement" shall mean the Subscription Agreement, dated
as of April 21, 1999, by and among the Company and certain subscribers thereto.

          "Subsidiary" means, with respect to any Person, (i) a corporation a
majority of whose capital stock with voting power, under ordinary circumstances,
to elect directors is at the time, directly or indirectly, owned by such Person,
by one or more Subsidiaries of such Person or by such Person and one or more
Subsidiaries thereof, (ii) any other Person (other than a corporation),
including without limitation a joint venture, in which such Person, one or more
Subsidiaries thereof or such Person and one or more Subsidiaries thereof,
directly or indirectly, at the date of determination thereof, has at least
majority ownership interest entitled to vote in the election of directors,
managers or trustees thereof (or other Persons performing similar functions),
(iii) the management of which is otherwise controlled, directly or indirectly,
by such Person or (iv) any other Person required to be consolidated with such
Person in accordance with generally accepted accounting principles. For purposes
of this definition (and for the determination of whether or not a Subsidiary is
a wholly-owned Subsidiary of a Person), any directors' qualifying shares
<PAGE>   26
or investment by foreign nationals mandated by applicable law shall be
disregarded in determining the ownership of a Subsidiary.

          "Tax" and "Taxes" shall mean any federal, state, local or foreign
income, gross receipts, property, sales, use, value added, license, excise,
franchise, capital, net worth, estimated, withholding, employment, payroll,
premium, withholding, alternative or added minimum, ad valorem, inventory,
asset, gains, transfer or excise tax, or any other tax, levy, custom, duty,
impost, governmental fee or other like assessment or charge of any kind
whatsoever, together with any interest, penalty or additions to tax,
imposed by any Governmental Entity and, including, without limitation, any
Taxes of another Person owing under a contract, as transferee or successor,
under Treas. Reg. ss. 1.1502-6 or analogous state, local or foreign law, or
otherwise.

          "Tax Return" shall mean any return, report or similar statement
required to be filed with respect to any Tax (including any attached schedules),
including, without limitation, any information return, claim for refund, amended
return or declaration of estimated Tax.

          "Transaction Documents" shall mean this Note, the 7.5% Note, the side
letter, dated December 30, 1999, between the Company and the Holder, the
Security Agreement, the Registration Rights Agreement, the warrants to be issued
to Affiliates of the Holder pursuant to section (c) of the aforesaid side letter
and the Warrants (as defined in the 7.5% Note).

          "Transfer" shall have the meaning ascribed thereto in 4.9.

          "Voting Securities" shall mean at any time shares of any class of
Capital Stock of the Company (or other corporation) which are then entitled to
vote generally in the election of directors of the Company (or such other
corporation).

          7.2. Accounting Principles. The character or amount of any asset,
liability, capital account or reserve and of any item of income or expense
required to be determined pursuant to this Note, and any consolidation or other
accounting computation required to be made pursuant to this Note, and the
construction of any definition in this Note containing a financial term, shall
be determined or made, as the case may be, in accordance with GAAP, to the
extent applicable, unless such principles are inconsistent with the express
requirements of this Note.

     8.   Miscellaneous.
<PAGE>   27
          8.1. Payment; Indemnity; Taxes. (a) If the date on which any payment
under this Note is required to be made occurs on a day other than a Business
Day, such payment shall be due and payable on the next succeeding Business Day.

                (b) (i) The Company and its Subsidiaries shall jointly and
severally indemnify and hold harmless the Holder and its Representatives (each,
an "Indemnified Person") from and against any and all suits, actions,
proceedings, claims (collectively, "Actions"), damages, losses, Liabilities and
out-of-pocket expenses (including reasonable attorneys' fees and disbursements
and other costs of investigation or defense, including those incurred upon any
appeal) which may be instituted or asserted against or incurred by any such
Indemnified Person as the result of credit having been extended, suspended or
terminated under this Note and the other Transaction Documents and the
administration of such credit, and in connection with or arising out of the
transactions contemplated hereunder and thereunder and any actions or failures
to act in connection therewith.

                    (ii) Upon receipt by any Indemnified Person of any Action
against such Indemnified Person with respect to which indemnity may be sought
under this Note or any other Transaction Document, such Indemnified Person shall
promptly notify the Company in writing, provided that failure so to notify the
Company shall not relieve the Company from any liability which the Company may
have on account of this indemnity or otherwise, except to the extent the Company
shall have been materially prejudiced by such failure. The Company shall, at its
option, assume the defense of any Action including the employment of counsel
reasonably satisfactory to the Indemnified Person. Any Indemnified Person shall
have the right to employ separate counsel in any such action and participate in
the defense thereof but the fees and expenses of such counsel shall be at the
expense of such Indemnified Person, unless: (i) the Company has failed promptly
to assume the defense and employ counsel or (ii) the named parties to such
Action (including any impleaded parties) include such Indemnified Person and the
Company, and such Indemnified Person and the Company shall have been advised by
counsel that there may be one or more legal defenses available to it which are
different from or in addition to those available to the Company or there is or
may be a conflict between the Company and any Indemnified Person (in which case
the Company may not assume the defense). In the event that any Indemnified
Person shall become entitled to separate counsel under this Note or any other
Transaction Document, the Company shall not in such event be responsible
hereunder for the fees and expenses of more than one firm of separate counsel in
connection with any Action
<PAGE>   28
in the same jurisdiction, in addition to any local counsel. In addition, the
Company will not, without prior written consent of the Indemnified Person,
settle, compromise or consent to the entry of any judgment in or otherwise seek
to terminate any pending or threatened Action in which indemnification may be
sought hereunder (whether or not any Indemnified Person is a party thereto)
unless such settlement, compromise, consent or termination includes an
unconditional release of such Indemnified Person from all liabilities and
expenses arising out of such Action.

               (c) The Company shall bear all sales, documentary, transfer,
stamp or other similar taxes and all filing fees and expenses incurred in
connection with the transactions contemplated by this Note and shall indemnify
and hold harmless each Indemnified Purchaser from and against any such taxes.

          8.2. Severability. If any term, provision, covenant or restriction of
this Note or any exhibit hereto is held by a court of competent jurisdiction to
be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Note and such exhibits shall remain in full
force and effect and shall in no way be affected, impaired or invalidated. It is
hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions
without including any of such which may be hereafter declared invalid, void or
unenforceable.

          8.3. Specific Enforcement. The Holder, on the one hand, and the
Company, on the other, acknowledge and agree that irreparable damage would occur
in the event that any of the provisions of this Note were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the Holder shall be entitled to an injunction to prevent
breaches of the provisions of this Note and to enforce specifically the terms
and provisions hereof in any court of the United States or any state thereof
having jurisdiction, this being in addition to any other remedy to which they
may be entitled at Law or equity.

          8.4. Entire Agreement. The Transaction Documents (including the
Schedules and Exhibits hereto and thereto) contain the entire understanding of
the parties with respect to the transactions contemplated hereby and thereby.

          8.5. Notices and other Communications. All notices, consents,
requests, instructions, approvals, financial statements, proxy statements,
reports and other communications provided for herein shall be deemed given,
<PAGE>   29
if in writing and delivered personally, by telecopy or sent by registered mail,
postage prepaid, if to:

          The Company, to:

          129 Reservoir Road
          Vernon, CT  06066
          Attention:  Carl Sahi
          Fax: (860) 870-6118

          With a copy to:

          Pepe & Hazard LLP
          Goodwin Square
          Hartford, CT  06103
          Attention: Walter W. Simmers, Esq.
          Fax: (860) 522-2796

          The Holder, to:

          c/o Appaloosa Management, L.P.
          26 Main Street, 1st Floor
          Chatham, New Jersey  07928
          Attention:  Mr. James Bolin
          Fax: (973) 701-7055

          With a copy to:

          Fried, Frank, Harris, Shriver & Jacobson
          One New York Plaza
          New York, NY  10004
          Attention:  Robert C. Schwenkel, Esq.
          Fax: (212) 859-4000

or to such other address as any party may, from time to time, designate in a
written notice given in a like manner.

          8.6. Successors and Assigns. All covenants and agreements contained
herein shall bind and inure to the benefit of the Holder and its respective
successors and assigns. The Company many not assign this Note without the
written consent of the Holder.

          8.7. Amendments. No amendment or waiver of any provision of this Note,
nor consent to any departure by the Company therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Holder and then
such amendment, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.

          8.8. Expenses. The Company agrees to promptly (but in no event later
than 2 business days) pay the Holder all costs and expenses (including the fees
and expenses of its counsel) incurred by it in connection with the transactions
contemplated hereby (to the extent not already paid by the Company on the date
hereof) and the Rollover Transactions (regardless of whether the Rollover
Transactions are consummated) upon the earlier to occur of (i) the prepayment of
the entire outstanding principal amount of the Note in accordance with Section
1.3 and (ii) the Due Date. In addition, the Company agrees to pay to the Holder
<PAGE>   30
all reasonable costs and expenses incurred by the Holder relating to any future
amendment or supplement to any of the Transaction Documents (or any proposal by
the Company for such amendment or supplement) whether or not consummated or any
waiver or consent with respect thereto (or any proposal for such waiver or
consent) whether or not consummated, and all costs and expenses of such Holder
relating to the enforcement of any of the Transaction Documents

          8.9 Survival. All covenants, agreements, representations and
warranties contained herein in connection with the transactions contemplated
hereby shall survive the date hereof and the delivery of the Transaction
Documents, regardless of any investigation made by or on behalf of any party;
provided, that, all covenants, agreements, representations and warranties
contained herein shall terminate when this Note and any amounts due hereunder
have been indefeasibly repaid in full; provided, however, that notwithstanding
anything to the contrary contained herein, Sections 6.3, 8.1(b), 8.2, 8.3, 8.4,
8.5 and 8.8 shall survive forever.

          8.10. Public Announcements. Neither the Company nor the Holder shall
make any public statements, including, without limitation, any press releases,
with respect to this Note or the other Transaction Documents and the
transactions contemplated hereby or thereby without the prior written consent of
the other party (which consent shall not be unreasonably withheld) except as may
be required by Law. If a public statement is required to be made by Law, the
parties shall consult with each other in advance as to the contents and timing
thereof.

          8.11. GOVERNING LAW. THIS NOTE AND THE OTHER TRANSACTION DOCUMENTS
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE
PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK EXCLUDING
CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE
APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.

          8.12. Submission to Jurisdiction. If any Litigation shall be brought
by the Holder in order to enforce any right or remedy under this Note or any of
the other Transaction Documents, the Company hereby consents and will submit,
and will cause each of its Subsidiaries to submit, to the jurisdiction of any
state or federal court of competent jurisdiction sitting within the area
comprising the Southern District of New York on the date of this Note. The
Company hereby irrevocably waives any objection, including, but not limited to,
any objection to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of any such
Litigation in such jurisdiction.

          8.13. Service of Process. Nothing herein shall affect the right of the
Holder to serve process in any other manner permitted by Law or to commence
legal proceedings or otherwise proceed against the Company in any
<PAGE>   31
other jurisdiction.

          8.14. WAIVER OF JURY TRIAL. THE COMPANY HEREBY WAIVES ANY RIGHT IT MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS NOTE OR
ANY OF THE OTHER TRANSACTION DOCUMENTS

          IN WITNESS WHEREOF, the Company has caused this Note to be duly
executed as of the date first above written.

                                         BIO-PLEXUS, INC.

                                         By: /s/ Carl Sahi
                                            -----------------------------
                                            Name:  Carl Sahi
                                            Title:

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