Document:

EXHIBIT 10.3

                               FARMOUT AGREEMENT

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                                FARMOUT AGREEMENT

                                     BETWEEN

                 DUBLIN INTERNATIONAL PETROLEUM (EGYPT) LIMITED
                          a wholly-owned subsidiary of
                           TANGANYIKA OIL COMPANY LTD.

                                       and

                             DRUCKER PETROLEUM INC.
                          a wholly-owned subsidiary of
                             DRUCKER INDUSTRIES LTD.

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                                    I N D E X

Article Number        Heading                                              Page
  1.1_                Definitions                                            2
  2.0                 Obligations of the Parties                             3
  3.0                 Representations and Warranties                         4
  4.0                 Relationship of the Parties                            6
  5.0                 Information                                            6
  6.0                 Applicable Law & Resolution of Disputes                7
  7.0                 Miscellaneous                                          7

Annexure "A"               Concession Agreement
Annexure "B"               Deed of Assignment

<PAGE>

                                FARMOUT AGREEMENT

THIS AGREEMENT is made and entered into as of the 28th day of April 1998, by and
between:

         DUBLIN INTERNATIONAL PETROLEUM (EGYPT) LIMITED, a company organised and
         existing  under the laws of the  Republic  of  Ireland  ("Dublin")  and
         wholly-owned  subsidiary  of  TANGANYIKA  OIL COMPANY  LTD.,  a company
         organised and existing under the laws of Canada ("Tanganyika") and;

         DRUCKER PETROLEUM INC., a company organised and existing under the laws
         of the British Virgin Islands  ("Drucker") and wholly-owned  subsidiary
         of DRUCKER  INDUSTRIES LTD., a company organised and existing under the
         laws of the United States.

WITNESSETH WHEREAS:

1.       On November 17,  1997,  Dublin was  notified of the  acceptance  by the
         Exploration   Offers  Committee  of  the  Egyptian  General   Petroleum
         Corporation (EGPC) of Dublin=s  application in a concession covering an
         area of  approximately  2,320 square  kilometres known as Block H, West
         Gharib, Gulf of Suez, Egypt.

2.       On December 1, 1997,  Dublin and EGPC initiated a concession  agreement
         (the "CA")  pursuant  to which  Dublin was granted the right to explore
         for  and  exploit  petroleum  on  the  Contract  Area  (as  hereinafter
         defined).  The CA is subject to  ratification  by the Government of the
         Arab Republic of Egypt (the "Government").

3.       On  December  28,  1997,  Dublin and EGPC signed a  Pre-Effective  Date
         Expenditure   Agreement   pursuant   to   which   Dublin's   Concession
         expenditures  would be recoverable  under the CA prior to the effective
         date of the CA.

4.       On March 24, 1998 Dublin was notified by  EGPC that Law No. 15 for 1998
         concerning the CA was issued.

<PAGE>

5.       Subject to the approvals of the Government and EGPC,  Dublin is willing
         to transfer and assign to Drucker an  undivided  twenty  percent  (20%)
         Participating  Interest  in  the  CA,  together  with  all  rights  and
         obligations pertaining thereto; and

6.       Drucker  is  desirous  of  acquiring  the  said  twenty  percent  (20%)
         Participating  Interest  on the basis of the terms and  conditions  set
         forth herein.

NOW THEREFORE in consideration of the mutual promises,  agreements and covenants
hereinafter set forth, the parties hereto agree as follows:

1.1_     DEFINITIONS

1.01 The terms defined in the recitals hereof or at other instances herein shall
have the meanings attributed to them thereby.  In addition,  the following words
and  expressions  shall,  for the purpose of this  Agreement,  bear the meanings
respectively set opposite them:

"Acquired Interest"      means a  twenty  (20%) undivided Participating Interest
                         free and clear of  all  encumbrances  to be transferred
                         and  assigned  as  contemplated  herein  by  Dublin  to
                         Drucker;

"Affiliate"              means in relation to each Party, any company,
                         corporation or other entity
                         1.       which is directly or indirectly controlled by
                                  such Party; or

                         2.       which directly or indirectly controls such
                                  Party; or

                         3.       which is directly or indirectly  controlled by
                                  a company,  corporation  or other entity  that
                                  also directly or indirectly controls such
                                  Party.

                         To this effect, control is conclusive by fact of owning
                         directly or indirectly shares in the company
                         representing more than fifty percent (50%) of the  vote
                         in general meeting.

"Agreement"              means this Farmout Agreement;

<PAGE>

"Contract Area"          means the area described in the Concession Agreement
                         (CA);

"Contract Depth"         means at depth of 200 feet into the Nubia  Formation or
                         9,000 feet whichever is shallower.

"Deed of  Assignment"    means  the  instrument  of transfer to be submitted  to
                         the  Government and EGPC for the  purpose of  obtaining
                         all the  necessary official  consents to the assignment
                         of  the Acquired Interest by Dublin to  Drucker,  which
                         instrument will substantially  be in the form set forth
                         in Annex "B" attached hereto;

"Effective Date"         means the date of execution of this Agreement;

"Joint Operating         means the Joint Operating Agreement to be entered into
Argeement" or "JOA"      between the Parties;

"Participating Interest" means an undivided percentage interest in the CA and
                         the JOA and all rights and obligations pertaining
                         thereto;

"Party"                  means a party to this Agreement.

All other terms specifically defined in the CA and not defined herein shall have
the  meanings  assigned  to them in the CA unless the context  clearly  requires
otherwise. A copy of the CA is attached hereto as Annexure AA@.

1.02 Unless the context  otherwise  requires,  reference to any Article is to an
Article of this Agreement. In addition, where the context requires, the singular
shall include the plural and the plural shall include the singular.

2.0      OBLIGATIONS OF THE PARTIES

2.01     Drucker shall, within seven (7) days of the Effective Date, pay to
         Dublin the following:

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         a.       thirty-four thousand United States Dollars (US$34,000),  being
                  twenty percent (20%) of all costs incurred prior to the
                  Effective Date;

         b.       three hundred  thousand  United States  Dollars  (US$300,000),
                  being forty percent  (40%) of the  Signature  Bonus payable to
                  EGPC;

         c.       eight thousand United States Dollars (US$8,000),  being twenty
                  percent (20%) of the CA administration costs payable to EGPC;

         1.       ten thousand United States Dollars  (US$10,000),  being twenty
                  percent (20%) of the annual training bonus payable to EGPC.

Payments shall be effected to  Tanganyika=s  bank account  numbered  1489057.202
with Cantrade  Ormond Burrus  Banque  Privee S.A., 12 rue  Ami-Lullin,  P.O. Box
3142, CH-1211, Geneva 3, Switzerland.

2.02  From and after the  Effective  date,  Drucker  shall  bear and pay  twenty
percent  (20%) of all  costs  and  expenses  including  but not  limited  to the
Financial Obligations related to the CA.

2.03 Drucker  shall bear and pay forty  percent  (40%) of the costs and expenses
associated with the drilling of an exploratory  well to Contract Depth including
casing to total depth and subsequent  testing or abandonment of said well in the
Initial Exploration Period. Notwithstanding the above, upon the earlier to occur
of (a)  the  drilling  and  testing  of  this  exploratory  well,  or (b)  total
cumulative costs incurred in drilling and completing or abandoning the said well
equal to one million five hundred thousand United States Dollars (US$1,500,000),
or a maximum  cost to Drucker of six  hundred  thousand  United  States  Dollars
(US$600,000);  thereafter,  Drucker shall pay twenty  percent (20%) of all costs
and expenses with any further activity related to this well.

2.04 Drucker shall,  within seven (7) days of the Effective Date, provide either
Dublin or  Tanganyika  (at Dublin=s  option) with a bank  guarantee  from a bank
acceptable  to  Dublin   equivalent  to  two  million   United  States   Dollars
(US$2,000,000),  being  forty  percent  (40%) of the Letter of  Guarantee.  Both

<PAGE>

Dublin and Tanganyika shall  immediately  provide Drucker with a Trust Agreement
covering  the 20% working  interest  of Drucker  until a Deed of  Assignment  is
approved by EGPC and the Government.

2.05 Dublin shall, upon receipt of the sums set out in Article 2.01 and the bank
guarantee  set out in  Article  2.04,  prepare,  execute  and submit the Deed of
Assignment to Drucker for execution by Drucker.

2.06 Dublin shall, as soon as possible following the date of receiving the fully
executed  Deed of  Assignment,  submit  the  same for  approval  by EGPC and the
Government and will use its best efforts to obtain said approvals.

2.07  Following  the  approval  of the  Deed  of  Assignment  by  EGPC  and  the
Government,  the respective  Participating  Interests of the Parties shall be as
follows:

                                            Dublin             50%
                                            GHP                30%
                                            Drucker            20%
                                                              ----
                                                              100%

2.08 Drucker agrees to assume its respective share of the rights and obligations
of Dublin  arising from and under the CA with  respect to the Acquired  Interest
from and after the date of execution of the Deed of Assignment.

2.09 The Parties shall use  reasonable  efforts to execute the JOA,  which shall
take effect as of the Effective Date, within thirty (30) days after execution of
this Agreement.

2.10 The Parties  agree that the Operator  shall be Dublin.  The Operator  shall
conduct all operations in accordance with the provisions of the CA and the JOA.

<PAGE>

3.0      REPRESENTATIONS AND WARRANTIES

3.01     Dublin hereby represents and warrants to Drucker that:

         a.       it is duly  established  and existing under the laws of the
                  Republic of Ireland and has the power and authority to own its
                  own assets and to conduct the business which it carries on;

         b.       it has the corporate power to enter into this  Agreement,  the
                  JOA  and  the  Deed  of  Assignment   and  to  carry  out  the
                  transactions  provided for therein and has taken all necessary
                  corporate  action to authorise  the  execution and delivery of
                  this  Agreement,  the Deed of  Assignment  and the JOA,  which
                  agreements constitute legally binding obligations on it;

         c.       the  CA is  valid,  approved  by  Majlis  Al  Shaab  (Egyptian
                  Parliament) and in good standing and there has been no default
                  by Dublin under, or breach by Dublin of the CA; and

         d.       Law No. 15 for 1998 has been issued by the  Government  giving
                  the beneficial  title to the Acquired  Interest and such title
                  is free and clear of all charges and claims of all persons and
                  entities  (and will be so assigned  free and clear at the date
                  of  assignment)  other than those of the  Government and EGPC,
                  whose charges and claims are fully set forth in the CA;

         e.       there is no  pending  of  threatened  litigation  which  would
                  materially  affect the consumption of, and benefits under this
                  Agreement, the Deed of Assignment and/or the JOA; and

         f.       it shall,  pursuant  to  Article  2, use its best  efforts  to
                  obtain all official consents to the Deed of Assignment.

<PAGE>

3.02     Drucker hereby represents and warrants to Dublin that:

         a.       it is duly established and existing under the laws of the
                  British Virgin Islands;

         b.       it has the corporate power to enter into this  Agreement,  the
                  Deed  of  Assignment  and  the  JOA,  and  to  carry  out  the
                  transactions  provided for therein and has taken all necessary
                  corporate  action to authorise  the  execution and delivery of
                  this  Agreement,  the  Deed of  Assignment  and the JOA  which
                  agreements constitute legally binding obligations on it.

4.0      RELATIONSHIP OF THE PARTIES

4.01 The rights, duties, obligations and liabilities of the Parties herein shall
be several and not joint or collective;  and nothing herein contained shall ever
be construed as creating a partnership of any kind, an association,  or a trust,
or as  imposing  upon any or all of the  Parties  hereto any  partnership  duty,
obligation or liability.  Each Party shall be individually  responsible only for
its obligations as set out in this Agreement.

5.0      INFORMATION

5.01 On the Effective  Date,  Dublin will make  available and furnish to Drucker
all data and information related to the Contract Area and the CA.

5.02  Subject  to the CA,  the  Parties  hereto  agree  that  the  terms of this
Agreement  shall be  considered  confidential  and shall not be disclosed to any
third party,  except to the extent  provided by (d) below.  Neither Party shall,
without  the prior  written  consent  of the other  Party,  disclose  during the
currency of this Agreement to any third party any data or  information  acquired
or obtained by any of them under the CA,  provided  that any Party may  disclose
any such information or data:

         a.       to the Government and EGPC;

         b.       to an Affiliate;

<PAGE>

         c.       to any technical,  financial or other professional  consultant
                  retained  by  it  or  its   Affiliate,   which   requires  the
                  information or data to provide professional services to Dublin
                  or Drucker;

         d.       to the extent required:
                  i.       by law, or
                  ii.      by the rules and  regulations  of any stock  exchange
                           upon  which  the  shares or other  securities  of any
                           Party or an  Affiliate  are  listed or in  connection
                           with an application to any stock exchange for listing
                           of any such shares or other securities;

         e.       to any  third  party with  which bona  fide negotiations for a
                  Participating  Interest  are conducted; or

         f.       to the extent that the information is in the public domain;

provided  always that with the exception of disclosure  under (a), (b), (d), and
(f) hereinabove,  the recipient of any information agrees in writing to keep the
same strictly confidential.

6.0      APPLICABLE LAW AND RESOLUTION OF DISPUTES

6.01 This  Agreement  shall be governed by and construed in accordance  with the
laws of Canada, excluding, however, any of its conflict of law rules which would
direct  or  refer  to the  laws of  another  jurisdiction.  The  Parties  hereto
specifically  attorn and submit  themselves to the jurisdiction of the courts of
Canada. In addition,  each Party  irrevocably  waives any objection which it may
now or  hereafter  have to  laying of venue of any  suit,  action or  proceeding
arising  out of or  relating  to this  Agreement  in the courts of  Canada,  and
irrevocably waives any claim that any such suit, action or proceeding brought in
the  courts of Canada  has been  brought in an  inconvenient  forum and  further
irrevocably waives the right to object,  with respect to such claim, suit action
or  proceeding  brought in the  courts of Canada,  that such court does not have
jurisdiction over such Party.

7.0      MISCELLANEOUS

7.01     This Agreement is subject to regulatory body approval.

<PAGE>

7.02 Any obligation of the Parties  hereunder  shall be suspended  while they or
any of them is prevented or hindered  from  complying  therewith by any cause of
force  majeure as that term is defined in the Force  Majeure  Article of the CA.
Any time limitations set forth in the Agreement shall be automatically  extended
for the same period of time that the obligations are so suspended.

7.03 The terms,  conditions,  warranties and  representations  in this Agreement
shall survive the execution of the Deed of Assignment and the JOA.

7.04 This  Agreement  may be  amended  in any  manner  and at any time only by a
written instrument executed by the Parties hereto.

7.05 Whether or not the transactions  contemplated  herein shall be consummated,
each of the Parties shall (except as otherwise specifically provided herein) pay
his own expenses  incidental to the  preparation,  execution and  performance of
this Agreement.

7.06 Either of the Parties  shall  execute and deliver such other  certificates,
agreements and other  documents and take such other actions as may reasonably be
requested  by  the  other  Party  in  order  to   consummate  or  implement  the
transactions contemplated by this Agreement.

7.07 All notices,  requests,  demands or other communications hereunder shall be
in writing,  and shall be delivered by hand or sent by courier.  Notices sent by

<PAGE>

fax are deemed to be  received on the  working  day of the  recipient  following
dispatch provided that the recipient acknowledge receipt by return fax.

         a.       If to DUBLIN INTERNATIONAL PETROLEUM (EGYPT) LIMITED:
                  Suite 1320-885 West Georgia Street
                  Vancouver, BC
                  Canada  V6V 3E8
                  Attention:        Mr. Lukas Lundin
                  Telephone:        (604) 689 7842
                  Facsimile:        (604) 689 4250

         2.       If to DRUCKER PETROLEUM INC.:
                  Suite 900, 789 West Pender Street
                  Vancouver, B.C.
                  Canada  V6C 1H2
                  Attention:        Mr. Ernest Cheung
                  Telephone:        (604) 685-3193
                  Facsimile:        (604) 681-7536

The address of each Party  hereto may be changed for any or all  purposes of the
Agreement by five (5) days advance written  notification from the Party changing
its address to the other Party.

7.08 This  Agreement  and all the  provisions  hereof  shall be binding upon and
enure to the benefit of the Parties hereto and their  respective  successors and
permitted assigns, but neither this Agreement nor any of the rights, interest or
obligations  hereunder  shall be  assigned,  by  operation  of law or  otherwise
consent of the other Parties,  which consent shall not be unreasonably withheld.
Notwithstanding the foregoing,  each Party shall be entitled, upon notification,
to assign to an Affiliate without the consent of the other Party.

7.09 This  Agreement may be executed in one or more  counterparts,  all of which
will constitute one and the same instrument.

<PAGE>

7.10 The section  headings in this Agreement are for  convenience  and reference
only and shall not be deemed to alter or affect the meaning or interpretation of
any provision thereof.

7.11 This  Agreement  hereby  supersedes any and all other  agreements,  oral or
written,  and  constitutes  the entire  agreement  among the  Parties  hereto in
respect of the subject matter of this Agreement.

<PAGE>

IN WITNESS  WHEREOF,  the Parties  hereto have executed this Agreement as of the
day and year first above written.

DUBLIN INTERNATIONAL PETROLEUM (EGYPT) LIMITED

"Edward L. Molnar"
-----------------------------
Name:    Edward L. Molnar
Title:   President

DRUCKER PETROLEUM INC.

"Ernest Cheung"
-----------------------------
Name:
Title:

<PAGE>

                                  ANNEXURE "A"

                              CONCESSION AGREEMENT

<PAGE>

                                  ANNEXURE "B"

                               DEED OF ASSIGNMENT

<PAGE>

                               DEED OF ASSIGNMENT

THIS DEED OF ASSIGNMENT is made as of this day of April, 1998 between:

         DUBLIN INTERNATIONAL  PETROLEUM (EGYPT) LIMITED, a company incorporated
         under the laws of the Republic of Ireland ("Dublin"); and

         DRUCKER  PETROLEUM INC., a company  incorporated  under the laws of the
         British Virgin Islands ("Drucker").

WHEREAS:

A. On April $____, 1998 Dublin signed a Concession Agreement (the "CA") with the
Government  of the Arab  Republic of Egypt (the  "Government")  and the Egyptian
General Petroleum  Corporation ("EGPC") pursuant to which Dublin was granted the
right to explore for and exploit petroleum from areas described in the CA;

B.  Subject to the  approval of the  Government  and EGPC,  Dublin is willing to
transfer and assign to Drucker an undivided  twenty percent (20%)  participating
interest in the CA, together with all rights and obligations pertaining thereto;
and

C. Drucker is desirous of acquiring the said thirty percent (20%)  participating
interest on the basis of the terms and conditions set forth herein.

NOW THEREFORE, the Parties hereto agree as follows:

1.  Dublin  hereby  assigns  to  Drucker  an  undivided   twenty  percent  (20%)
participating  interest in and to the CA and the  Drucker  hereby  accepts  such
assignment.

2.  Dublin  hereby  expressly  states  that the  rights  and  privileges  of the
Government  and EGPC under the CA shall not be prejudiced  by the  provisions of
this Agreement.

<PAGE>

3. Drucker hereby expressly  agrees to be bound by all the obligations  provided
for under the CA.

4. For the purposes of the CA, Drucker=s address is as follows:

         Suite 900, 789 West Pender Street
         Vancouver, B.C.
         Canada  V6C 1H2
         Attention:        Mr. Ernest Cheung
         Telephone:        (604) 685-3193
         Facsimile:        (604) 681-7536

5.  This  Assignment  shall be  effective  upon  obtaining  the  consent  of the
Government and EGPC hereto in accordance with Article 21 of the CA.

IN WITNESS  WHEREOF,  the Parties  hereto have executed this Agreement as of the
day and year first above written.

DUBLIN INTERNATIONAL PETROLEUM (EGYPT) LIMITED

---------------------------------
Name:
Title:

DRUCKER PETROLEUM INC.

---------------------------------
Name:
Title:This Note,  and the securities  issuable upon the conversion of this Note,  have
not been registered  under the Securities Act of 1933, as amended (the "Act") or
applicable state law and may not be sold,  transferred or otherwise  disposed of
unless  registered  under the Act and any  applicable  state  act or unless  the
Company  receives an opinion from  counsel for the holder and is satisfied  that
this Note and the underlying  securities may be transferred without registration
under the Act.

                                CONVERTIBLE NOTE

$200,000                                                 As of December 14, 1999
                                                         Palm Beach, Florida

FOR  VALUE  RECEIVED,  PLATINUM  AND  GOLD,  INC.,  a  Nevada  corporation  (the
"Company"),  hereby  promises to pay to the order of  Professional  Acquisitions
Management  &  Marketing  Corp.,  or any  subsequent  holder  of this  Note (the
"Payee"),  at 607 S. Alexander  Street,  Suite 107, Plant City, FL 33566,  or at
such other place as may be  designated  by the Payee from time to time by notice
to the Company,  the principal sum of Two Hundred Thousand  Dollars  ($200,000),
together with simple interest from the date hereof (the "Issuance  Date") on the
unpaid  principal amount at an annual rate equal to nine percent (9%) per annum.
Such  principal  and  interest  shall be paid in  accordance  with the  terms of
Section 1 below, to such account as the Payee shall direct.

1.       PAYMENTS.

(a) The unpaid  principal  amount of this Note shall be converted  into Rule 144
Restricted  Common Stock of the Company as provided herein on or before December
14, 2000 (the "Maturity Date").

(b)  Interest on the unpaid  principal  balance of this Note at the rate of nine
percent (9%) per annum shall accrue from the date hereof and shall be payable to
the Payee in shares of Common  Stock of the Company at the  Maturity  Date,  the
number of which shall be equal to the product of such interest  payment  divided
by the Conversion Price, as defined herein, with the overage, if any, payable in
cash. Interest shall be calculated on the basis of a 365 day year.

(c) In the event that any payment of principal and/or interest hereunder becomes
due and payable on a Saturday,  Sunday or other day on which commercial banks in
the State of  Florida  are  authorized  or  required  by law to close,  then the
maturity  thereof  shall be  extended  to the  next  succeeding  "Business  Day"
(defined as any days on which  national  banks in the United States are open for
business); and during any such extension,  interest on principal amounts payable
shall accrue and be payable at the applicable rate.

                                                                              1

<PAGE>

2.       RANKING OF NOTE.

         Subject  at all  times to the  subordination  provisions  set  forth in
Section 9 hereof,  this Note shall constitute  senior  securities of the Company
and, except as provided below, shall rank pari passu with all other indebtedness
for money borrowed by the Company and senior to any other indebtedness for money
borrowed by the Company which, by its terms shall be made expressly  subject and
subordinated to this Note.

3.       PREPAYMENT OF NOTE.

(a) Prior to the  Maturity  Date,  the Company  shall  provide the holder with a
notice that a  prepayment  event has occurred  (the  "Prepayment  Notice").  The
holder  shall have  thirty (30) days from the date of the  Prepayment  Notice to
elect (i) to take prepayment of the principal amount of the Note and any accrued
but unpaid  interest in whole  without  premium or penalty or (ii) to convert in
accordance with Section 4 hereof.

(b)  Notwithstanding  anything to the contrary set forth in Section 3(a) hereof,
subject at all times to the holder's right to convert all or any portion of this
Note into Common Stock  pursuant to Section 4 hereof,  the  principal  amount of
this Note and any accrued and unpaid  interest may be prepaid,  at the option of
the Company,  in whole or in part,  without  premium or penalty,  at any time or
from time to time from and after that date which  shall be the  earlier to occur
of (i) the Maturity  Date or (ii) the date on which the Company  shall  register
for resale  pursuant to the  Securities  Act of 1933, as amended (the "Act") all
"Conversion  Shares" (as herein defined)  issuable upon conversion of the entire
principal  amount of this Note,  pursuant  to a  Registration  Statement  on the
appropriate  registration form declared effective by the Securities and Exchange
Commission  (the  "SEC").  If either  event set forth in this Section 3(b) shall
occur, the Company shall provide the holder with a Prepayment Notice.

(c) Each Prepayment Notice shall specify the principal amount of this Note to be
redeemed.  Each prepayment of principal of this Note shall be accompanied by the
payment of all interest  accrued and unpaid to the prepayment date on the amount
so prepaid.  Each such prepayment  shall be made by wire transfer of immediately
available  funds or by bank  cashier's  check payable to the Payee.  Any partial
prepayment of this Note,  whether optional or mandatory,  shall be applied first
to accrued and unpaid interest  hereon,  and then to the  outstanding  principal
amount of this Note in the inverse order of maturity.

4.       CONVERSION.

Subject at all times to the  Company's  right to prepay the Notes as provided in
Section 3 hereof,  the holders of the Notes shall have the following  conversion
rights (the "Conversion Rights"):

(a)  Voluntary  Conversion.  At any  time or from  time  to time  following  the
Issuance  Date,  the holder of this Note may elect to convert up to one  hundred
(100%) percent of the original principal amount of this Note and any accrued but
unpaid interest, into shares of Common Stock of the

                                        2

<PAGE>

Company at the  Conversion  Price,  by written  notice  given to the  Company in
accordance with the provisions of Section 4(g) hereof (the "Conversion Notice").
In no event may the holder of this Note effect a conversion of less than $10,000
principal  amount of this Note.  Such  right of  Voluntary  Conversion  shall be
effected by the surrender of this Note to the Company for conversion at any time
during normal  business hours at the office of the Company,  accompanied  (i) by
the  Conversion  Notice,  (ii) if so required by the Company,  by instruments of
transfer, in a form satisfactory to the Company, duly executed by the registered
holder or by his duly authorized attorney and (iii) transfer tax stamps or funds
therefore, if required pursuant to Section 4(f) herein.

(b) Automatic  Conversion.  Effective as of the Maturity Date, to the extent not
previously converted by the holder, all remaining principal amount of this Note,
together  with all accrued  interest  hereon,  shall  automatically  and without
further  action on the part of such holder be converted into Common Stock of the
Company at the Conversion Price.

(c)  Conversion  Price.  Subject to adjustment  from time to time as provided in
Section 4(d) below,  the term  "Conversion  Price" shall mean $1.00 per share of
common stock.

(d) Adjustments of Conversion Price. The Conversion Price in effect from time to
time shall be,  subject to adjustment in accordance  with the provisions of this
Section 4(d).

         (i) Adjustments for Stock Splits and Combinations. If the Company shall
at any time or from time to time after the Issuance  Date,  effect a stock split
of the  outstanding  Common Stock,  the Conversion  Price in effect  immediately
prior to the stock  split  shall be  proportionately  decreased.  If the Company
shall at any time or from time to time  after the  Issuance  Date,  combine  the
outstanding  shares of Common Stock, the Conversion Price in effect  immediately
prior to the combination  shall be  proportionately  increased.  Any adjustments
under this  Section  4(d)(i)  shall be effective at the close of business on the
date the stock split or combination occurs.

         (ii)  Adjustments  for  Certain  Dividends  and  Distributions.  If the
Company shall at any time or from time after the Issuance Date, make or issue or
set a record date for the  determination  of holders of Common Stock entitled to
receive a dividend  or other  distribution  payable  in shares of Common  Stock,
then, and in each event,  the Conversion  Price in effect  immediately  prior to
such event shall be decreased  as of the time of such  issuance or, in the event
such a record  date shall have been  fixed,  as of the close of business on such
record date, by multiplying the Conversion Price then in effect by a fraction;

                  (A) the numerator of which shall be the total number of shares
of Common Stock  issued and  outstanding  immediately  prior to the time of such
issuance or the close of business on such record date; and

                  (B) the  denominator  of which  shall be the  total  number of
shares of Common Stock issued and outstanding  immediately  prior to the time of
such  issuance  or the close of  business on such record date plus the number of
shares of Common Stock issuable in payment of such dividend or distribution.

                                       3

<PAGE>

         (iii) Adjustments for Other Dividends and Distributions. If the Company
shall at any time or from time to time after the Issuance Date, make or issue or
set a record date for the  determination  of holders of Common Stock entitled to
receive a dividend or other distribution  payable in other than shares of Common
Stock, then, and in each event, an appropriate  revision to the Conversion Price
shall be made and  provision  shall be made (by  adjustments  of the  Conversion
Price  or  otherwise)  so that  the  holder  of this  Note  shall  receive  upon
conversions  thereof,  in  addition  to the  number of  shares  of Common  Stock
receivable  thereon,  the number of  securities  of the Company which they would
have received had this Note been converted into Common Stock on the date of such
event and had  thereafter,  during the period from the date of such event to and
including the  Conversion  Date,  retained such  securities  (together  with any
distributions  payable  thereon during such period),  giving  application to all
adjustments  called for during such period  under this  Section  4(c)(iii)  with
respect to the rights of the holders of the Note.

         (iv) Adjustments for Reclassification, Exchange or Substitution. If the
Common Stock  issuable upon  conversion of this Note at any time or from time to
time  after the  Issuance  Date shall be  changed  into the same or a  different
number of shares of any class or classes of stock,  whether by reclassification,
exchange,  substitution  or  otherwise  (other  than by way of a stock  split or
combination of shares or stock dividends provided for in Sections 4(d)(i),  (ii)
and  (iii),  or a  reorganization,  merger,  consolidation,  or sale  of  assets
provided  for in Section  4(d)(v)),  then,  and in each  event,  an  appropriate
revision to the Conversion  Price shall by made and provisions shall be made (by
adjustments  of the  Conversion  Price of  otherwise) so that the holder of this
Note shall  have the right  thereafter  to  convert  such Note into the kind and
amount  of  shares  of  stock  and  other   securities   receivable   upon  such
reclassification,  exchange,  substitution  or other  change,  by holders of the
number of shares of Common Stock into which such Note might have been  converted
immediately  prior to such  reclassification,  exchange,  substitution  or other
change, all subject to further adjustment as provided herein.

         (v) Adjustments for Reorganization,  Merger,  Consolidation or Sales of
Assets.  If at any time or from time to time after the Issuance Date there shall
be a capital  reorganization  of the Company (other than by way of a stock split
or combination  of shares or stock  dividends or  distributions  provided for in
Section 4(d)(i), (ii) and (iii), or a reclassification, exchange or substitution
of shares provided for in Section 4(d)(iv)), or a merger or consolidation of the
Company with or into another  corporation,  or the sale of all or  substantially
all of the Company's properties or assets to any other person, then as a part of
such reorganization,  merger, consolidation, or sale, an appropriate revision to
the Conversion  Price shall be made and provision  shall be made (by adjustments
of the Conversion Price or otherwise) so that the holder of this Note shall have
the right  thereafter to convert this Note into the kind and amount of shares of
stock  and  other  securities  or  property  of the  Company  or  any  successor
corporation resulting from such reorganization,  merger, consolidation, or sale,
to which a holder of Common Stock  deliverable  upon  conversion  of such shares
would have been entitled upon such  reorganization,  merger,  consolidation,  or
sale. In any such case,  appropriate adjustment shall be made in the application
of the  provisions  of this  Section  4(d)(v)  with respect to the rights of the
holders of this Note after the reorganization, merger, consolidation, or sale to
the end that the provisions of this Section 4(c)(v) (including any adjustment in

                                        4

<PAGE>

the  Conversion  Price then in effect and the number of shares of stock or other
securities deliverable upon conversion of this Note) shall be applied after that
event in as nearly an equivalent manner as may be practicable.

(d) No  Impediment.  The Company shall not, by amendment of its  Certificate  of
Incorporation or through any reorganization,  transfer of assets, consolidation,
merger, dissolution,  issue or sale of securities or any other voluntary action,
avoid or seek to avoid the  observance or  performance of any of the terms to be
observed or performed  hereunder  by the Company,  but will at all times in good
faith, assist in the carrying out of all the provisions of this Section 4 and in
the taking of all such action as may be  necessary  or  appropriate  in order to
protect  the  conversion  rights  of the  holders  of the Note set forth in this
Section 4 against impairment.

(e)  Certificate  as to  Adjustments.  Upon  occurrence  of each  adjustment  or
readjustment  of the  Conversion  Price or number  of  shares  of  Common  Stock
issuable upon  conversion of the Note pursuant to this Section 4, the Company at
its  expense,   shall  promptly  compute  such  adjustment  or  readjustment  in
accordance  with the terms hereof and furnish notice to the holder of this Note,
a certificate setting forth such adjustment and readjustment,  showing in detail
the facts upon which such  adjustment  or  readjustment  is based.  The  Company
shall, upon written request of the holder of this Note, at any time,  furnish or
cause to be  furnished  to such  holder a like  certificate  setting  forth such
adjustments and readjustments,  the applicable Conversion Price in effect at the
time and the number of shares of Common  Stock and the amount,  if any, of other
securities or property  which at the time would be received upon the  conversion
of such Note.  Notwithstanding the foregoing, the Company shall not be obligated
to deliver a certificate  unless such  certificate  would reflect an increase or
decrease of at least one percent (1%) of such adjusted amount.

(f) Issue  Taxes.  The  Company  shall  pay any and all  issue and other  taxes,
excluding  federal,  state or local income taxes, that may be payable in respect
of any issue or delivery of shares of Common  Stock on  conversion  of this Note
pursuant hereto;  provided,  however, that the Company shall not be obligated to
pay any transfer taxes  resulting  from any transfer  requested by any holder in
connection with any such conversion.

(g)  Notices  and  Delivery  of Shares.  All  notices  and other  communications
hereunder shall be in writing and shall be deemed given (i) on the same date, if
delivered  personally  or by facsimile by not later than 5:00 p.m.  Florida time
(provided,  that a copy of such facsimile shall be simultaneously sent to Donald
F. Mintmire, Esq. at (561)659-5371,  or (ii) three business days following being
mailed  by  certified  or  registered  mail,  postage  prepaid,   return-receipt
requested, addressed to the party in accordance with Section 7 hereof. Not later
than  seven (7)  Business  Days  following  receipt of notice of  conversion  as
provided herein (the "Delivery Date"),  the Company shall deliver to the holders
of  this  Note,  against  delivery  of this  Note  surrendered  for  conversion,
certificates evidencing all shares of Common Stock into which this Note shall be
converted.

(h) Fractional Shares. No fractional shares of Common Stock shall be issued upon
conversion  of the Note.  In lieu of any  fractional  shares to which the holder
would otherwise be entitled,  the Company shall pay cash equal to the product of
such fraction  multiplied by the Conversion  Price of one share of the Company's
Common Stock on the applicable Conversion Date.

                                        5

<PAGE>

(i) Reservation of Common Stock. The Company shall at all times reserve and keep
available, out of its authorized but unissued shares of Common Stock, solely for
the purpose of effecting the  conversion of the Note,  the full number of shares
deliverable upon conversion of all the Note from time to time  outstanding.  The
Company  shall,  from  time  to time  in  accordance  with  the  Nevada  General
Corporations Law, as amended, increase the authorized number of shares of Common
Stock if at any time the  unissued  number  of  authorized  shares  shall not be
sufficient to permit the conversion of all of the Note at the time  outstanding.
In such connection, the Company shall hold a special meeting of stockholders not
later than 180 days after any date in which the Company shall have  insufficient
shares of Common  Stock so reserved  for the purpose of  authorizing  additional
shares of Common Stock.

(j)  Retirement  of Note.  Conversion  of this Note shall be deemed to have been
effected on the  applicable  Conversion  Date.  The  converting  holder shall be
deemed  to have  become a  stockholder  of  record  of the  Common  Stock on the
applicable  Conversion Date. Upon conversion of only a portion of this Note, the
Company  shall issue and deliver to such holder,  at the expense of the Company,
against receipt of the original Note delivered for partial  cancellation,  a new
Note representing the unconverted portion of this Note so surrendered and Common
Stock equal to the portion converted.

(k)      Regulatory Compliance.

         (i) If any shares of Common  Stock to be  reserved  for the  purpose of
conversion of this Note require  registration or listing with or approval of any
government authority,  stock exchange or other regulatory body under any federal
or state law or regulation or otherwise before such shares may be validly issued
or delivered upon  conversion,  the Company shall, at its sole cost and expense,
in good  faith  and as  expeditiously  as  possible,  endeavor  to  secure  such
registration, listing or approval, as the case may be.

         (ii) The shares of Common Stock  issuable  upon the election to convert
shall be Rule 144 restricted shares (the "Restricted Securities").

         (iii) The holder of such shares shall have the  following  registration
rights:

                  (A) Neither this Note nor the Shares  underlying  it have been
registered under the Securities Act of 1933, as amended (the "Act").  Unless and
until registered  under the Act, this Note and all replacement  Notes shall bear
the following legend:

         This Note,  and the  securities  issuable  upon the  conversion of this
         Note,  have not been  registered  under the  Securities Act of 1933, as
         amended  (the  "Act")  or  applicable  state  law and may not be  sold,
         transferred or otherwise  disposed of unless  registered  under the Act
         and any  applicable  state act or unless the Company is satisfied  that
         this  Note and the  underling  securities  may be  transferred  without
         registration under the Act.

                                        6

<PAGE>

         (a) This  offering is being  conducted  pursuant to Section 3(b) of the
Securities  Act of 1933,  as amended (the "Act"),  and Rule 504 of  Regulation D
promulgated thereunder ("Rule 504") or other applicable provisions, although the
shares  issuable  upon  conversion  of this  Note  shall be Rule 144  restricted
shares. The Company expects to file for an exemption for shares under Regulation
A in the near future.  In the event the Company acquires such an exemption under
Regulation A, the Company shall issue Regulation A exempt shares in lieu of such
restricted shares. In addition, upon conversion of this Note, and after issuance
of the  Shares,  at any  time  that  the  Company  proposes  to  file a  Company
registration statement on Form S-1 under the Act (the "Registration Statement"),
either for its own account or for the account of a stockholder or  stockholders,
the Company shall give the Holder  written  notice of its intention to do so and
of the intended method of sale (the  "Registration  Notice") within a reasonable
time  prior  to  the  anticipated  filing  date  of the  Company's  Registration
Statement effecting such Company  registration.  Holder may request inclusion of
any Restricted  Securities in such  Registration  Statement by delivering to the
Company, within ten (10) Business Days after receipt of the Registration Notice,
a written  notice (the  "Piggyback  Notice")  stating  the number of  Restricted
Securities  proposed to be  included  and that such shares are to be included in
any  underwriting  only on the same terms and conditions as the shares of Common
Stock otherwise being sold through  underwriters under such Company Registration
Statement.  The  Company  shall use its best  efforts  to cause  all  Restricted
Securities  specified  in the  Piggyback  Notice to be  included  in the Company
Registration  Statement and any related offering, all to the extent requisite to
permit the sale by the Holder of its  Restricted  Securities in accordance  with
the method of sale  applicable  to the other shares of Common Stock  included in
such Company Registration  Statement;  provided,  however,  that if, at any time
after giving  written  notice of its  intention to register any  securities  and
prior to the  effective  date of the  Company  Registration  Statement  filed in
connection  with such  registration,  the Company shall determine for any reason
not to register or to delay registration of Holder's Restricted Securities,  the
Company may, at its  election,  give  written  notice of such  determination  to
Holder and, thereupon:

                  (i) in the ease of a determination  not to register,  shall be
relieved  of its  obligation  to  register  Holder's  Restricted  Securities  in
connection  with  such  registration  (but not from  its  obligation  to pay the
registration expenses in connection therewith), and

                  (ii) in the case of a delay in registering, shall be permitted
to delay registering  Holder's Restricted  Securities for the same period as the
delay in registering such other securities.

         (b) The  Company's  obligation  to include  Restricted  Securities in a
Company's Registration Statement shall be subject to the following limitations:

                  (i) The  Company  may  elect,  at its sole  option and for any
reason, not to register Holder's Restricted Shares,  provided however, that this
right is  limited to one (1) time and  relative  to one (1)  particular  Company
Registration Statement.

                  (ii)  The  Company  shall  not be  obligated  to  include  any
Restricted Securities in a registration statement filed on Form S-4, Form S-8 or
such other similar successor forms then in effect under the Securities Act.

                                        7

<PAGE>

                  (iii)  If  a  Company   Registration   Statement  involves  an
underwritten  offering  and the  managing  underwriter  advises  the  Company in
writing that in its opinion,  the number of securities  requested to be included
in such Company  Registration  Statement exceeds the number which can be sold in
such  offering  without  adversely  affecting  the  offering,  the Company shall
include in such Company  Registration  Statement  the number of such  securities
which the Company is so advised can be sold in such offering  without  adversely
affecting the offering, determined as follows:

                           (A) first, the securities  proposed by the Company to
be sold for it own account, and

                           (B) second, any Restricted Securities requested to be
included  in such  registration  and any  other  securities  of the  Company  in
accordance with the  priorities,  if and then existing among the holders of such
securities pro rata among the holders thereof  requesting  such  registration on
the basis of the number of shares of such securities requested to be included by
such holders.

                  (iv) The Company shall not be obligated to include  Restricted
Securities in more than one (1) Company Registration Statement.

         (c) To the extent  Holder's  Restricted  Securities  are intended to be
included  in a Company  Registration  Statement,  Holder may  include any of its
Restricted  Securities in such Company  Registration  Statement pursuant to this
Agreement  only if Holder  furnishes to the Company in writing,  within ten (10)
business days after receipt of a written  request  therefore,  such  information
specified in Item 507 of Regulation S-K under the Act or such other  information
as the Company may  reasonably  request for use in  connection  with the Company
Registration  Statement or Prospectus or preliminary Prospectus included therein
and in any application to the NASD. Holder as to which the Company  Registration
Statement  is being  effected  agrees to furnish  promptly  to the  Company  all
information required to be disclosed in order to make all information previously
furnished to the Company by Holder not materially misleading.

5.       EVENTS OF DEFAULT.

The  occurrence and  continuance  of any one or more of the following  events is
herein referred to as an Event of Default:

(a) If the Company shall default in converting the applicable  principal  amount
of this Note into Common Stock and delivering  stock  certificates in respect of
such conversion  within thirty (30) Business Days from the Company's  receipt of
the applicable notice of conversion  pursuant to the provisions hereof,  whether
on the Maturity Date or otherwise; or

(b) If the Company shall default in the payment of any  installment  of interest
on this Note when  payable in  accordance  with the terms  thereof for more than
sixty (60)  calendar  days after the same shall  become due if the Payee has not
elected to take such interest in Common  Stock;  and if the Payee has elected to
take such interest in Common  Stock,  if the Company shall default in delivering

                                        8

<PAGE>

stock  certificates  in respect of such election within sixty (60) Business Days
from the Company's receipt of the notice of such election; or

(c) If the  Company  shall not,  at the time of receipt of a  Conversion  Notice
hereunder,  have a sufficient  number of authorized  and unissued  shares of its
Common Stock  available for issuance to the holder of this Note upon  conversion
of all or any portion of this Note in accordance with the terms hereof, and such
default shall not have been remedied  within one hundred  eighty (180)  calendar
days from the date of such Conversion Notice; or

(d) If the Company shall default in the performance of or compliance with any of
its material covenants or agreements contained herein and such default shall not
have been remedied within thirty (30) calendar days after written notice thereof
shall  have  been  delivered  to the  Company  by the  holder  of  this  Note in
accordance with the notice provisions herein; or

(e) If any  representation  or  warranty  made in writing by or on behalf of the
Company in connection with the transactions  contemplated  hereby shall prove to
have been false or  incorrect  in any  material  respect on the date as of which
made; or

(f) If the Company or any of its "Significant  Subsidiaries" (as defined herein)
shall make an assignment for the benefit of creditors, or shall admit in writing
its  inability  to pay its debts as they  become  due, or shall file a voluntary
petition in  bankruptcy  or shall have an order for relief under the  Bankruptcy
Act granted against it or them, or shall be adjudicated a bankrupt or insolvent,
or shall file any  petition  or answer  seeking  for itself any  reorganization,
arrangement,  composition,  readjustment,  liquidation,  dissolution  or similar
relief under any present or future statute, law or regulation, or shall file any
answer admitting or not contesting the material  allegations of a petition filed
against  the  Company  or any  of  its  Significant  Subsidiaries  in  any  such
proceeding,  or shall seek or consent to or acquiesce in the  appointment of any
trustee,  custodian,  receiver  or  liquidator  of the  Company or of all or any
substantial  part of the  properties  of the  Company or any of its  Significant
Subsidiaries,  or the Company or its directors  shall take any action looking to
the  dissolution  or  liquidation  of the  Company  or  any  of its  Significant
Subsidiaries. For purposes of this Section 5(f), the term Significant Subsidiary
shall mean and include any other person,  firm or corporation  (i) more than 50%
of the  common  stock or  equity  interests  of which are owned of record by the
Company or any  Subsidiary of the Company,  and (ii) the net income before taxes
or total assets of which represent more than 15% of the  consolidated net income
before taxes or consolidated  assets of the Company and all of its Subsidiaries;
or

(g) If, within sixty (60) days after the commencement of any proceeding  against
the  Company  or  any  Significant   Subsidiary   seeking  any   reorganization,
arrangement,  composition,  readjustment,  liquidation,  dissolution  or similar
relief under any present or future statute,  law or regulation,  such proceeding
shall  not have  been  dismissed,  or if,  within  sixty  (60)  days  after  the
appointment,  without  the  consent  or  acquiescence  of  the  Company  or  any
Significant Subsidiary, of any trustee, receiver or liquidator of the Company or
any Significant  Subsidiary or of all or any substantial  part of the properties
of the Company or any Significant  Subsidiary,  such appointment  shall not have
been vacated.

                                        9

<PAGE>

6.       REMEDIES ON DEFAULT; ACCELERATION.

Upon the  occurrence  and during the  continuance  of an Event of  Default,  the
entire  unpaid  balance of  principal  and accrued  interest on this Note may be
accelerated and declared to be immediately due and payable by the holder in Rule
144  Restricted  Shares of the  Company's  Common  Stock.  Unless  waived by the
written  consent of the  holder,  such holder may proceed to protect and enforce
its rights by an action at law, suit in equity or other appropriate  proceeding,
whether for the specific  performance of any agreement  contained herein, or for
an injunction  against a violation of any of the terms hereof,  or in aid of the
exercise of any power granted  hereby or by law. Upon the occurrence of an Event
of Default,  the Company  agrees to pay to the holder of this Note such  further
amount as shall be  sufficient  to cover  the cost and  expense  of  collection,
including,  without  limitation,  reasonable  attorneys'  fees and expenses.  No
course  of  dealing  and no  delay  on the part of the  holder  of this  Note in
exercising  any right,  power or remedy  shall  operate  as a waiver  thereof or
otherwise prejudice such holder's rights,  powers and remedies.  No right, power
or remedy  conferred  hereby upon the holder  hereof  shall be  exclusive of any
other right,  power or remedy referred to herein nor now or hereafter  available
at law, in equity, by statute or otherwise.

7.       NOTICES.

All notices,  requests,  demands or other  communications  hereunder shall be in
writing and  personally  addressed or sent by  telecopier  or by  registered  or
certified  mail,  return  receipt  requested,  postage  pre- paid,  addressed or
telecopied  as follows or to such other  address or  telecopier  number of which
notice has been given pursuant hereto:

         If to the Company:                 Platinum and Gold, Inc.
                                            12724 N.W. 11th Court
                                            Sunrise, FL 33323
                                            Attn: Carol Neal
                                            Telephone: (800) 525-8495
                                            Fax: (954) 845-0656

         with copy to:                      Mintmire & Associates
                                            265 Sunrise Avenue, Suite 204
                                            Palm Beach, FL  33480
                                            Attn:  Donald F. Mintmire, Esq.
                                            Telephone: (561) 832-5696
                                            Fax: (561) 659-5371

 If to the Holder:  to such  Holder at the  address  set forth on the records of
                    the  Company.  In  addition,  copies of all such  notices or
                    other communications shall be concurrently  delivered by the
                    person   giving  the  same  to  each  person  who  has  been
                    identified  to the Company by such Holder as a person who is
                    to receive copies of such notices.

                                       10

<PAGE>

8.       GOVERNING LAW.

This Note shall be governed by, and  construed  and  interpreted  in  accordance
with, the laws of the State of Nevada,  without giving effect to conflict of law
principles.

9.       SUBORDINATION TO SENIOR DEBT.

(a) Payment of the  principal of and interest on this Note is  subordinated,  to
the  extent  and in the  manner  provided  herein,  to the prior  payment of all
indebtedness of the Company and/or all  Subsidiaries  of the Company,  for money
borrowed  or  other   obligations   which  is  now  or  may  hereafter  be  owed
(collectively,  "Senior Debt") to any bank, commercial finance company,  factor,
insurance  company or other  institution  the  lending  activities  of which are
regulated by law  (individually,  a "Senior  Lender" and  collectively,  "Senior
Lenders"),  which may,  hereafter on any one or more occasions provide financing
to the Company or any of its Subsidiaries, secured by liens on any of the assets
and properties of the Company and/or any of its Subsidiaries  (individually  and
collectively, an "Institutional Borrower").

(b)  Upon  any  payment  or   distribution   of  assets  or  securities  of  the
Institutional Borrower, as the case may be, of any kind or character, whether in
cash,  property or  securities,  upon any  dissolution or winding up or total or
partial  liquidation or reorganization of the  Institutional  Borrower,  whether
voluntary or  involuntary or in bankruptcy,  insolvency,  receivership  or other
proceedings,  all amounts  payable under Senior Debt shall first be paid in full
in cash, or payment provided for in cash or cash equivalents,  before the holder
hereof  shall be entitled to receive any payment on account of  principal  of or
interest  on this Note.  Before  any  payment  may be made by the  Institutional
Borrower of the principal of or interest on this Note upon any such  dissolution
or winding up or liquidation or  reorganization,  any payment or distribution of
assets or  securities  of the  Institutional  Borrower of any kind of character,
whether in cash,  property or  securities,  to which the holder  hereof would be
entitled,  except  for the  provisions  of this  Section 9, shall be made by the
Institutional  Borrower or by any receiver,  trustee in bankruptcy,  liquidating
trustee, agent or other person making such payment or distribution,  directly to
the holders of Senior Debt or their  representatives  to the extent necessary to
pay all such Senior Debt in full after giving effect to any  concurrent  payment
or distribution to the holders of such Senior Debt.

(c) Upon the happening of any default in payment of the principal of or interest
on any Senior Debt, then, unless and until such default shall have been cured or
waived or shall have  ceased to exist,  no direct or  indirect  payment in cash,
property or securities,  by set-off or otherwise,  shall be made or agreed to be
made by the Institutional Borrower on account of the principal of or interest on
this Note.

(d) Upon the  happening of an event of default  (other than under  circumstances
when the terms of Section 9(c) above are applicable)  with respect to any Senior
Debt  pursuant to which the holder  thereof is entitled  under the terms of such
Senior Debt to accelerate the maturity thereof,  and upon written notice thereof
given to each of the Institutional  Borrower and the holder of this Note by such
holder of Senior Debt ("Payment  Notice"),  then, unless and until such event of
default shall have been

                                       11

<PAGE>

cured or waived or shall have ceased to exist,  no action  shall or may be taken
for collection of any amounts under this Note, and no direct or indirect payment
in cash,  property  or  securities,  by set-off or  otherwise,  shall be made or
agreed to be made by the  Institutional  Borrower an account of the principal of
or interest on this Note until such Senior Debt has been paid in full accordance
with its terms.

(e) In the event that,  notwithstanding  the  provisions  of this Section 9, any
payment shall be made on account of the principal of or interest on this Note in
contravention  of such  provisions,  then  such  payment  shall  be held for the
benefit of, and shall be paid over and  delivered to, the holders of such Senior
Debt  remaining  unpaid to the extent  necessary  to pay in full in cash or cash
equivalents the principal of and interest on such Senior Debt in accordance with
its terms after giving effect to any concurrent  payment or  distribution to the
holders of such Senior Debt.

(f)      Nothing contained in this Section 9 shall

         (i) impair  the  conversion  rights of the holder hereof referred to in
Section 4 above,

         (ii)  impair,  as between the Company and the holder of this Note,  the
obligation of the Company,  which is absolute and  unconditional,  to pay to the
holder  hereof  principal and interest as the same shall become due and payable,
or

         (iii) prevent the holder hereof from exercising all rights,  powers and
remedies  otherwise  provided  herein or by  applicable  law, all subject to the
express limitations provided herein.

(g) Upon the occurrence of an Event of Default, if any Senior Debt shall then be
outstanding,  no  acceleration  of the  maturity of this Note shall be effective
until the earlier of (i) ten (10) days shall have passed  following  the date of
delivery to the  Institutional  Borrower by a Senior Lender(s) of written notice
of acceleration of any Senior Debt, or (ii) the maturity of any then outstanding
Senior  Debt  shall have been  accelerated  by reason of a default  hereon.  The
Company may pay the holder  hereof any  defaulted  payment and all other amounts
due following any such acceleration of the maturity of this Note if this Section
9 would not prohibit such payment to be made at that time.

(h) Upon  payment  in full of all Senior  Debt,  the Payee of this Note shall be
subrogated  to the rights of the holder or holders of Senior Debt to receive all
payments or  distributions  applicable  on such Senior Debt to the extent of the
prior  application  thereto  of moneys or other  assets  which  would  have been
received in respect of this Note, but for these subordination provisions,  until
the principal of, and interest on, this Note shall have been paid in full.

(i)      The Payee, by accepting this Note

         (i) shall be bound by all of the foregoing subordination provisions;

         (ii) agrees expressly for the benefit of the present and future holders
of Senior Debt that this

                                       12

<PAGE>

Note is subject to the foregoing subordination provisions;

         (iii)  authorizes such persons as shall be designated by all holders of
Senior Debt at any given time, on his or its benefit to execute and deliver such
agreements,  assignments,  proofs of claim and other  documents  appropriate  to
effectuate the foregoing subordination provisions; and

          (iv) hereby appoints the person so designated his or its  attorney-in-
fact for such purpose.

(j) The  foregoing  subordination  provisions  shall be for the  benefit  of all
holders of Senior Debt from time to time  outstanding,  and each of such holders
may proceed to enforce such provisions either directly against the holder hereof
or in any other manner provided by law.

10.      PERMITTED PAYMENTS.

Notwithstanding  the  provisions of Section 9 of this Note, and provided that no
default or event of default (or event which,  with the passage of time or giving
of notice  or both)  has  occurred,  will  occur as a result  of the  "Permitted
Payment" (herein  defined),  or will occur with the passage of time or giving of
notice or both,  under any document or instrument  evidencing  such Senior Debt,
the Company may pay to the Payee, and the Payee may accept from the Company, the
principal  payments of, and/or interest  payments on, the outstanding  principal
amount of this  Note  when due on an  unaccelerated  basis  (herein,  "Permitted
Payments");  it being  understood and agreed by the Payee by accepting this Note
that neither:

(a)      the payment terms set forth in Section l of this Note;

(b)      the subordination provisions contained in Section 9 of this Note, nor

(c)      the  provisions  of this  Section 10 of this Note,  may be  modified or
         amended  without the prior written  consent of each and every holder of
         Senior Debt.

11.      SUCCESSORS AND ASSIGNS.

This Note shall be binding  upon and inure to the benefit of the Company and the
holder hereof and their respective  successors and permitted assigns;  provided,
however,  that the  Company  may not  transfer  or assign  any of its  rights or
obligations  hereunder  without the prior written  consent of the holder hereof;
and  provided,  further,  that  transfer  or  assignment  by  the  holder  is in
accordance with the rules governing Restricted Securities.

IN WITNESS WHEREOF,  the Company has caused this Note to be executed by its duly
authorized officers as of the date first set forth above.

                                       13

<PAGE>

                               PLATINUM AND GOLD, INC.

                               By: /s/ Carol Neal
                              ------------------------
                              Carol Neal, President

Attest: /s/ Terry Ritchie
        ---------------------

                                       14

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