Document:

SECURED
      CONVERTIBLE NOTE

     

    NEITHER
      THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
      THE
      SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
      LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
      (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
      SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION
      OF COUNSEL, IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION
      IS
      NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144
      OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES
      MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
      OR
      FINANCING ARRANGEMENT SECURED BY THE SECURITIES. ANY TRANSFEREE OF THIS NOTE
      SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE.

     

    NATURAL
      NUTRITION, INC.

     

    SECURED
      CONVERTIBLE NOTE

     

    
      
        	Issuance Date: May 31,
                2007	
                 Original
                  Principal Amount:

                U.S.
                  $9,292,894.00

              

      

    

     

    FOR
      VALUE RECEIVED,
      NATURAL
      NUTRITION, INC.,
      a
      Nevada corporation (the “Company”),
      hereby promises to pay to the order of CORNELL
      CAPITAL PARTNERS, L.P.
      or its
      registered assigns (“the Holder”)
      the
      amount set out above as the Original Principal Amount (as reduced pursuant
      to
      the terms hereof pursuant to redemption, conversion or otherwise, the
“Principal”)
      when
      due, whether upon the Maturity Date (as defined below), on any Installment
      Date
      with respect to the Installment Amount due on such Installment Date (each,
      as
      defined herein), acceleration, redemption or otherwise (in each case in
      accordance with the terms hereof) and to pay interest (“Interest”)
      on the
      outstanding Principal at the applicable Interest Rate from the date set out
      above as the Issuance Date (the “Issuance
      Date”)
      until
      the same becomes due and payable, whether upon an Interest Date (as defined
      below), any Installment Date or the Maturity Date or acceleration, conversion,
      redemption or otherwise (in each case in accordance with the terms hereof).
      This
      Secured Convertible Note (including all convertible notes issued in exchange,
      transfer or replacement hereof, this “Note”)
      is
      issued pursuant to the Securities Purchase Agreement on the Closing Date.
      Certain capitalized terms used herein are defined on Exhibit A
      hereto.
      Capitalized terms not otherwise defined herein shall have the respective
      meanings ascribed to such terms in the Securities Purchase
      Agreement.

     

    The
      obligations of the Company to the Holder as evidenced by this Note are secured
      by (x) the collateral identified and described as security therefor in the
      Amended and Restated Security Agreement of even date herewith (the “Security
      Agreement”)
      executed by the Company in favor of the Holder, and (y) the Guaranty and related
      General Security Agreement, of even date herewith, each executed by INII in
      favor of the Holder.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (1)  PAYMENTS
      OF PRINCIPAL.
      (a)
      Beginning January 1, 2008, on each Installment Date the Company shall pay
      to the Holder as a repayment of Principal hereunder an amount in cash equal
      to
      the Installment Amount.

     

    (b) On
      the
      Maturity Date, the Company shall pay to the Holder an amount in cash
      representing all outstanding Principal, accrued and unpaid Interest and accrued
      and unpaid Late Charges on such Principal and Interest. The “Maturity
      Date”
means,
      unless extended by the Holder, the earlier of (i) June 1, 2012, (ii) the
      consummation of a Change of Control and (iii) the occurrence of an Event of
      Default or any event that with the passage of time and the failure to cure
      would
      result in an Event of Default.

     

    (c) The
      Company may prepay this Note at any time upon not less than thirty (30) days
      prior written notice to the Holder; provided, that any such prepayments shall
      applied first to unpaid Late Charges on Principal and Interest, if any, then
      to
      unpaid Interest and then unpaid Principal.

     

    (2)  INTEREST;
      INTEREST RATE.
      Interest on this Note shall commence accruing on the Issuance Date and shall
      be
      computed on the basis of a 360-day year comprised of twelve (12)
      thirty  (30) day months and shall be compounded monthly and added to the
      unpaid Principal hereunder. Unless required to be paid sooner hereunder, accrued
      and unpaid Interest shall be payable at Maturity. From and after the occurrence
      and during the continuance of an Event of Default, the Interest Rate shall
      be
      increased from twelve percent (12%) to eighteen percent (18%). In the event
      that
      such Event of Default is subsequently cured, the adjustment referred to in
      the
      preceding sentence shall cease to be effective as of the date of such cure;
      provided that the Interest as calculated and unpaid at such increased rate
      during the continuance of such Event of Default shall continue to apply to
      the
      extent relating to the days after the occurrence of such Event of Default
      through and including the date of cure of such Event of Default.

     

    (3)  CONVERSION
      OF NOTES.
      This
      Note shall be convertible into shares of the Company’s common stock, par value
      $0.001 per share (the “Common
      Stock”),
      on
      the terms and conditions set forth in this Section 3.

     

    (a)  Conversion
      Right.
      Subject
      to the provisions of Section 3(d), at any time or times on or after the
      Issuance Date, the Holder shall be entitled to convert any portion of the
      outstanding and unpaid Conversion Amount (as defined below) into fully paid
      and
      nonassessable shares of Common Stock in accordance with Section 3(c), at
      the Conversion Rate (as defined below). The Company shall not issue any fraction
      of a share of Common Stock upon any conversion. If the issuance would result
      in
      the issuance of a fraction of a share of Common Stock, the Company shall round
      such fraction of a share of Common Stock up to the nearest whole share. The
      Company shall pay any and all transfer, stamp and similar taxes that may be
      payable with respect to the issuance and delivery of Common Stock upon
      conversion of any Conversion Amount.

     

    (b)  Conversion
      Rate.
      The
      number of shares of Common Stock issuable upon conversion of any Conversion
      Amount pursuant to Section 3(a) shall be determined by dividing
      (x) such Conversion Amount by (y) the Conversion Price (the
“Conversion
      Rate”).

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    (i) “Conversion
      Amount”
means
      the portion of the Principal to be converted, redeemed or otherwise with respect
      to which this determination is being made.

     

    (ii) “Conversion
      Price”
means,
      as of any Conversion Date (as defined below) or other date of determination,
      the
      lesser or (x) $0.05, subject to adjustment as provided herein, and (y) 80%
      of
      the lowest daily Weighted Average Price of the Common Stock during the
      five (5) Trading Days immediately preceding the conversion
      date.

     

    (c)  Mechanics
      of Conversion.

     

    (i)  Optional
      Conversion.
      To
      convert any Conversion Amount into shares of Common Stock on any date (a
“Conversion
      Date”),
      the
      Holder shall (A) transmit by facsimile (or otherwise deliver) a copy of an
      executed notice of conversion in the form attached hereto as Exhibit B
      (the
“Conversion
      Notice”)
      to the
      Company and (B) if required by this Section 3(c), surrender this Note to
      the Company (or an indemnification undertaking with respect to this Note in
      the
      case of its loss, theft or destruction). Promptly following (but in any event
      not more than one Business Day following the date of receipt of a Conversion
      Notice), the Company shall transmit by facsimile a confirmation of receipt
      of
      such Conversion Notice to the Holder and the Company’s transfer agent (the
“Transfer
      Agent”).
      On or
      before the second Business Day following the date of receipt of a Conversion
      Notice (the “Share
      Delivery Date”),
      the
      Company shall (1) (X) if legends are not required to be placed on
      certificates of Common Stock pursuant to the Securities Purchase Agreement
      and
      provided that the Transfer Agent is participating in the Depository Trust
      Company’s (“DTC”)
      Fast
      Automated Securities Transfer Program, credit such aggregate number of shares
      of
      Common Stock to which the Holder shall be entitled to the Holder’s or its
      designee’s balance account with DTC through its Deposit Withdrawal Agent
      Commission system or (Y) if the Transfer Agent is not participating in the
      DTC Fast Automated Securities Transfer Program, issue and deliver to the address
      as specified in the Conversion Notice, a certificate, registered in the name
      of
      the Holder or its designee, for the number of shares of Common Stock to which
      the Holder shall be entitled which certificates shall not bear any restrictive
      legends unless required pursuant to the Securities Purchase Agreement; and
      (2) pay to the Holder in cash an amount equal to the accrued and unpaid
      Interest on the Conversion Amount up to and including the Conversion Date.
      If
      this Note is physically surrendered for conversion as required by this Section
      3(c) and the outstanding Principal of this Note is greater than the Principal
      portion of the Conversion Amount being converted, then the Company shall as
      soon
      as practicable and in no event later than five (5) Business Days after receipt
      of this Note and at its own expense, issue and deliver to the holder a new
      Note
      representing the outstanding Principal not converted. The Person or Persons
      entitled to receive the shares of Common Stock issuable upon a conversion of
      this Note shall be treated for all purposes as the record holder or holders
      of
      such shares of Common Stock on the Conversion Date. In the event of a partial
      conversion of this Note pursuant hereto, the principal amount converted shall
      be
      deducted from the Installment Amounts relating to the Installment Dates as
      set
      forth in the Conversion Notice.

     

    (ii)  Company’s
      Failure to Timely Convert.
      If
      within five (5) Trading Days after the Company’s receipt of the facsimile copy
      of a Conversion Notice the Company shall fail to issue and deliver a certificate
      to the Holder or credit the Holder’s balance account with DTC for the number of
      shares of Common Stock to which the Holder is entitled upon such holder’s
      conversion of any Conversion Amount (a “Conversion
      Failure”),
      and
      if on or after such Trading Day the Holder purchases (in an open market
      transaction or otherwise) Common Stock to deliver in satisfaction of a sale
      by
      the Holder of Common Stock issuable upon such conversion that the Holder
      anticipated receiving from the Company (a “Buy-In”),
      then
      the Company shall, within five (5) Business Days after the Holder’s request and
      in the Holder’s discretion, either (i) pay cash to the Holder in an amount
      equal to the Holder’s total purchase price (including brokerage commissions and
      other out of pocket expenses, if any) for the shares of Common Stock so
      purchased (the “Buy-In
      Price”),
      at
      which point the Company’s obligation to deliver such certificate (and to issue
      such Common Stock) shall terminate, or (ii) promptly honor its obligation
      to deliver to the Holder a certificate or certificates representing such Common
      Stock and pay cash to the Holder in an amount equal to the excess (if any)
      of
      the Buy-In Price over the product of (A) such number of shares of Common
      Stock, times (B) the Closing Bid Price on the Conversion Date.

     

    
      
        
        

      

      
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    (iii)  Book-Entry.
      Notwithstanding anything to the contrary set forth herein, upon conversion
      of
      any portion of this Note in accordance with the terms hereof, the Holder shall
      not be required to physically surrender this Note to the Company unless
      (A) the full Conversion Amount represented by this Note is being converted
      or (B) the Holder has provided the Company with prior written notice (which
      notice may be included in a Conversion Notice) requesting reissuance of this
      Note upon physical surrender of this Note. The Holder and the Company shall
      maintain records showing the Principal, Interest and Late Charges converted and
      the dates of such conversions or shall use such other method, reasonably
      satisfactory to the Holder and the Company, so as not to require physical
      surrender of this Note upon conversion.

     

    (d)  Limitations
      on Conversions - Beneficial Ownership.
      The
      Company shall not effect any conversion of this Note, and the Holder of this
      Note shall not have the right to convert any portion of this Note pursuant
      to
      Section 3(a), to the extent that after giving effect to such conversion,
      the Holder (together with the Holder’s affiliates) would beneficially own in
      excess of 4.99% (the “Maximum
      Percentage”)
      of the
      number of shares of Common Stock outstanding immediately after giving effect
      to
      such conversion. For purposes of the foregoing sentence, the number of shares
      of
      Common Stock beneficially owned by the Holder and its affiliates shall include
      the number of shares of Common Stock issuable upon conversion of this Note
      with
      respect to which the determination of such sentence is being made, but shall
      exclude the number of shares of Common Stock which would be issuable upon
      (A) conversion of the remaining, nonconverted portion of this Note
      beneficially owned by the Holder or any of its affiliates and (B) exercise
      or conversion of the unexercised or nonconverted portion of any other securities
      of the Company (including, without limitation, any warrants) subject to a
      limitation on conversion or exercise analogous to the limitation contained
      herein beneficially owned by the Holder or any of its affiliates. Except as
      set
      forth in the preceding sentence, for purposes of this Section 3(d)(i),
      beneficial ownership shall be calculated in accordance with Section 13(d)
      of the Securities Exchange Act of 1934, as amended (the “1934
      Act”).
      For
      purposes of this Section 3(d)(i), in determining the number of outstanding
      shares of Common Stock, the Holder may rely on the number of outstanding shares
      of Common Stock as reflected in (x) the Company’s most recent Annual Report
      on Form 10-KSB, Quarterly Report on Form 10-QSB or Current Report on
      Form 8-K, as the case may be (y) a more recent public announcement by
      the Company or (z) any other notice by the Company or the Transfer Agent
      setting forth the number of shares of Common Stock outstanding. For any reason
      at any time, upon the written request of the Holder, the Company shall within
      one (1) Business Day confirm in writing to the Holder the number of shares
      of
      Common Stock then outstanding. In any case, the number of outstanding shares
      of
      Common Stock shall be determined after giving effect to the conversion or
      exercise of securities of the Company, including this Note, by the Holder or
      its
      affiliates since the date as of which such number of outstanding shares of
      Common Stock was reported.

     

    
      
        
        

      

      
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    (4)  RIGHTS
      UPON EVENT OF DEFAULT.

     

    (a)  Event
      of Default.
      Each of
      the following events shall constitute an “Event
      of Default”:

     

    (i) the
      failure of the applicable registration statement required to be filed pursuant
      to the Registration Rights Agreement to be declared effective by the SEC on
      or
      prior to the date that is sixty (60) calendar days after the applicable
      effectiveness deadline (as defined in the Registration Rights Agreement), or,
      while the applicable registration statement is required to be maintained
      effective pursuant to the terms of the Registration Rights Agreement, the
      effectiveness of the applicable registration statement lapses for any reason
      (including, without limitation, the issuance of a stop order) or is unavailable
      to any holder of the Notes for sale of all of such holder’s Registrable
      Securities (as defined in the Registration Rights Agreement) in accordance
      with
      the terms of the Registration Rights Agreement, and such lapse or unavailability
      continues for a period of ten (10) consecutive days (other than days during
      an Allowable Grace Period (as defined in the Registration Rights Agreement)
      or
      for more than an aggregate of thirty (30) days in any 365-day period (other
      than
      days during an Allowable Grace Period);

     

    (ii) the
      suspension from trading or failure of the Common Stock to be listed on an
      Eligible Market for a period of five (5) consecutive Trading Days or for
      more than an aggregate of ten (10) Trading Days in any 365-day
      period;

     

    (iii) the
      Company’s (A) failure to cure a Conversion Failure by delivery of the
      required number of shares of Common Stock within ten (10) Business Days
      after the applicable Conversion Date or (B) notice, written or oral, to any
      holder of the Notes, including by way of public announcement, at any time,
      of
      its intention not to comply with a request for conversion of any Notes into
      shares of Common Stock that is tendered in accordance with the provisions of
      the
      Notes, other than pursuant to Section 3(d);

     

    (iv) at
      any
      time following the tenth (10th)
      consecutive Business Day following the Company’s failure to have a sufficient
      number of shares of Common Stock authorized and available for delivery to the
      Holder upon a conversion of the full Conversion Amount of this Note (without
      regard to any limitations on conversion set forth in Section 3(d) or
      otherwise);

     

    (v) the
      Company’s failure to pay to the Holder any amount of Principal, Interest, Late
      Charges or other amounts when and as due under this Note, any other indebtedness
      of the Company or any of its Subsidiaries to the Holder, or any other
      Transaction Document (as defined in the Securities Purchase Agreement) or any
      other agreement, document, certificate or other instrument delivered in
      connection with the transactions contemplated hereby and thereby to which the
      Holder is a party, except, in the case of a failure to pay Interest and Late
      Charges when and as due, in which case only if such failure continues for a
      period of at least ten (10) Business Days;

     

    
      
        
        

      

      
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    (vi) the
      occurrence of any default under, redemption of or acceleration prior to maturity
      of any Indebtedness of the Company or any of its Subsidiaries (as defined in
      Section 3(a) of the Securities Purchase Agreement) which, individually or
      in the aggregate, exceeds $100,000;

     

    (vii) the
      Company or any of its Subsidiaries, pursuant to or within the meaning of
      Title 11, U.S. Code, or any similar Federal, foreign or state law for the
      relief of debtors (collectively, “Bankruptcy
      Law”),
      (A) commences a voluntary case, (B) consents to the entry of an order
      for relief against it in an involuntary case, (C) consents to the
      appointment of a receiver, trustee, assignee, liquidator or similar official
      (a
“Custodian”),
      (D) makes a general assignment for the benefit of its creditors or
      (E) admits in writing that it is generally unable to pay its debts as they
      become due;

     

    (viii) a
      court
      of competent jurisdiction enters an order or decree under any Bankruptcy Law
      that (A) is for relief against the Company or any of its Subsidiaries in an
      involuntary case, (B) appoints a Custodian of the Company or any of its
      Subsidiaries or (C) orders the liquidation of the Company or any of its
      Subsidiaries;

     

    (ix) a
      final
      judgment or judgments for the payment of money aggregating in excess of $100,000
      are rendered against the Company or any of its Subsidiaries and which judgments
      are not, within sixty (60) calendar days after the entry thereof, bonded,
      discharged or stayed pending appeal, or are not discharged within
      sixty (60) calendar days after the expiration of such stay;

     

    (x) the
      Company or any Subsidiary breaches any representation, warranty, covenant or
      other term or condition of this Note, any other indebtedness or agreement of
      the
      Company or any of its Subsidiaries with the Holder, or any Transaction Document,
      which breach has or is likely to have a cost or adverse impact on the Company
      or
      the Holder in excess of $100,000, except, in the case of a breach of a covenant
      or other term or condition which is curable, only if such breach continues
      for a
      period of at least five (5) consecutive Business Days;

     

    (xi) the
      Company’s breach or failure in any material respect to comply with any covenant
      in this Note; or

     

    (xii) any
      Event
      of Default (as defined in the Subsidiary Note) occurs with respect to the
      Subsidiary Note.

     

    
      
        
        

      

      
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    (b)  Redemption
      Right.
      Upon
      the occurrence of an Event of Default with respect to this Note or the
      Subsidiary Note, the Company shall within five (5) Business Days deliver
      written notice thereof via facsimile and overnight courier (an “Event
      of Default Notice”)
      to the
      Holder. At any time after the earlier of the Holder’s receipt of an Event of
      Default Notice and the Holder becoming aware of an Event of Default, the Holder,
      in addition to any other rights or remedies available to it, including enforcing
      its rights under the Security Agreement, may require the Company to redeem
      all
      or any portion of this Note by delivering written notice thereof (the
“Event
      of Default Redemption Notice”)
      to the
      Company, which Event of Default Redemption Notice shall indicate the portion
      of
      this Note the Holder is electing to redeem. Each portion of this Note subject
      to
      redemption by the Company pursuant to this Section 4(b) shall be redeemed
      by the Company at a price equal to the greater of (i) the product of
      (A) the sum of the Conversion Amount to be redeemed together with accrued
      and unpaid Interest with respect to such Conversion Amount and accrued and
      unpaid Late Charges with respect to such Conversion Amount and Interest and
      (B) the Redemption Premium and (ii) the product of (A) the
      Conversion Rate with respect to such sum of the Conversion Amount together
      with
      accrued and unpaid Interest with respect to such Conversion Amount and accrued
      and unpaid Late Charges with respect to such Conversion Amount and Interest
      in
      effect at such time as the Holder delivers an Event of Default Redemption Notice
      and (B) the product of (1) the Equity Value Redemption Premium and
      (2) the greater of (x) the Closing Sale Price of the Common Stock on
      the date immediately preceding such Event of Default, (y) the Closing Sale
      Price of the Common Stock on the date immediately after such Event of Default
      and (z) the Closing Sale Price of the Common Stock on the date the Holder
      delivers the Event of Default Redemption Notice (the “Event
      of Default Redemption Price”).
      Redemptions required by this Section 4(b) shall be made in accordance with
      the provisions of Section 4(c). To the extent redemptions required by this
      Section 4(b) are deemed or determined by a court of competent jurisdiction
      to be prepayments of the Note by the Company, such redemptions shall be deemed
      to be voluntary prepayments. In the event of a partial redemption of this Note
      pursuant hereto, the principal amount redeemed shall be deducted from the
      Installment Amounts relating to the applicable Installment Dates as set forth
      in
      the Event of Default Redemption Notice. The parties hereto agree that in the
      event of the Company’s redemption of any portion of the Note under this
      Section 4(b), the Holder’s damages would be uncertain and difficult to
      estimate because of the parties’ inability to predict future interest rates and
      the uncertainty of the availability of a suitable substitute investment
      opportunity for the Holder. Accordingly, any Redemption Premium due under this
      Section 4(b) is intended by the parties to be, and shall be deemed, a
      reasonable estimate of the Holder’s actual loss of its investment opportunity
      and not as a penalty.

     

    (c)  Mechanics.
      The
      Company shall deliver the applicable Event of Default Redemption Price to the
      Holder within five (5) Business Days after the Company’s receipt of the
      Holder’s Event of Default Redemption Notice. In the event of a redemption of
      less than all of the Conversion Amount of this Note, the Company shall promptly
      cause to be issued and delivered to the Holder a new Note (in accordance with
      Section 14(d)) representing the outstanding Principal which has not been
      redeemed. In the event that the Company does not pay the applicable Redemption
      Price to the Holder within the time period required, at any time thereafter
      and
      until the Company pays such unpaid Redemption Price in full, the Holder shall
      have the option, in lieu of redemption, to require the Company to promptly
      return to the Holder all or any portion of this Note representing the Conversion
      Amount that was submitted for redemption and for which the applicable Redemption
      Price (together with any Late Charges thereon) has not been paid. Upon the
      Company’s receipt of such notice, (x) the applicable Redemption Notice
      shall be null and void with respect to such Conversion Amount, (y) the
      Company shall immediately return this Note, or issue a new Note (in accordance
      with Section 14(d)) to the Holder representing the sum of such Conversion
      Amount to be redeemed together with accrued and unpaid Interest with respect
      to
      such Conversion Amount and accrued and unpaid Late Charges with respect to
      such
      Conversion Amount and Interest and (z) the Conversion Price of this Note or
      such new Notes shall be adjusted to the lesser of (A) the Conversion Price
      as in effect on the date on which the applicable Redemption Notice is voided
      and
      (B) the lowest Closing Bid Price of the Common Stock during the period
      beginning on and including the date on which the applicable Redemption Notice
      is
      delivered to the Company and ending on and including the date on which the
      applicable Redemption Notice is voided. The Holder’s delivery of a notice
      voiding a Redemption Notice and exercise of its rights following such notice
      shall not affect the Company’s obligations to make any payments of Late Charges
      which have accrued prior to the date of such notice with respect to the
      Conversion Amount subject to such notice.

     

    
      
        
        

      

      
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    (5)  RIGHTS
      UPON FUNDAMENTAL TRANSACTION AND CHANGE OF CONTROL.
      The
      Company shall not enter into or be party to a Fundamental Transaction unless
      (i)
      the Successor Entity assumes in writing all of the obligations of the Company
      under this Note and the other Transaction Documents in accordance with the
      provisions of this Section 5(a) pursuant to written agreements in form and
      substance reasonably satisfactory to the Holder and approved by the Holder
      (which such approval shall not be unreasonably withheld) prior to such
      Fundamental Transaction, including agreements to deliver to the Holder of the
      Note in exchange for such Note a security of the Successor Entity evidenced
      by a
      written instrument substantially similar in form and substance to the Note,
      and
      reasonably satisfactory to the Holder and (ii) the Successor Entity (including
      its Parent Entity) is a publicly traded corporation whose common stock is quoted
      on or listed for trading on an Eligible Market (a “Public
      Successor Entity”).
      Upon
      the occurrence of any Fundamental Transaction, the Successor Entity shall
      succeed to, and be substituted for (so that from and after the date of such
      Fundamental Transaction, the provisions of this Note referring to the
“Company”
shall
      refer instead to the Successor Entity), and may exercise every right and power
      of the Company and shall assume all of the obligations of the Company under
      this
      Note with the same effect as if such Successor Entity had been named as the
      Company herein. Upon consummation of the Fundamental Transaction, the Successor
      Entity shall deliver to the Holder confirmation that there shall be issued
      upon
      conversion of this Note at any time after the consummation of the Fundamental
      Transaction, in lieu of the shares of Common Stock (or other securities, cash,
      assets or other property) issuable upon the conversion of the Note prior to
      such
      Fundamental Transaction, such shares of the publicly traded common stock (or
      their equivalent) of the Successor Entity (including its Parent Entity), as
      adjusted in accordance with the provisions of this Note. The provisions of
      this
      Section shall apply similarly and equally to successive Fundamental Transactions
      and shall be applied without regard to any limitations on the conversion of
      this
      Note.

     

    
      
        
        

      

      
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    (6)  RIGHTS
      UPON ISSUANCE OF PURCHASE RIGHTS AND OTHER CORPORATE EVENTS.

     

    (a)  Purchase
      Rights.
      If at
      any time the Company grants, issues or sells any Options, Convertible Securities
      or rights to purchase stock, warrants, securities or other property pro rata
      to
      the record holders of any class of Common Stock (the “Purchase
      Rights”),
      then
      the Holder will be entitled to acquire, upon the terms applicable to such
      Purchase Rights, the aggregate Purchase Rights which the Holder could have
      acquired if the Holder had held the number of shares of Common Stock acquirable
      upon complete conversion of this Note (without taking into account any
      limitations or restrictions on the convertibility of this Note) immediately
      before the date on which a record is taken for the grant, issuance or sale
      of
      such Purchase Rights, or, if no such record is taken, the date as of which
      the
      record holders of Common Stock are to be determined for the grant, issue or
      sale
      of such Purchase Rights.

     

    (b)  Other
      Corporate Events.
      In
      addition to and not in substitution for any other rights hereunder, prior to
      the
      consummation of any Fundamental Transaction pursuant to which holders of shares
      of Common Stock are entitled to receive securities or other assets with respect
      to or in exchange for shares of Common Stock (a “Corporate
      Event”),
      the
      Company shall make appropriate provision to insure that the Holder will
      thereafter have the right to receive upon a conversion of this Note, at the
      Holder’s option, (i) in addition to the shares of Common Stock receivable
      upon such conversion, such securities or other assets to which the Holder would
      have been entitled with respect to such shares of Common Stock had such shares
      of Common Stock been held by the Holder upon the consummation of such Corporate
      Event (without taking into account any limitations or restrictions on the
      convertibility of this Note) or (ii) in lieu of the shares of Common Stock
      otherwise receivable upon such conversion, such securities or other assets
      received by the holders of shares of Common Stock in connection with the
      consummation of such Corporate Event in such amounts as the Holder would have
      been entitled to receive had this Note initially been issued with conversion
      rights for the form of such consideration (as opposed to shares of Common Stock)
      at a conversion rate for such consideration commensurate with the Conversion
      Rate. The provisions of this Section shall apply similarly and equally to
      successive Corporate Events and shall be applied without regard to any
      limitations on the conversion or redemption of this Note.

     

    (7)  RIGHTS
      UPON ISSUANCE OF OTHER SECURITIES.

     

    (a)  Adjustment
      of Conversion Price upon Issuance of Common Stock.
      If and
      whenever on or after the Subscription Date, the Company issues or sells, or
      in
      accordance with this Section 7(a) is deemed to have issued or sold, any
      shares of Common Stock (including the issuance or sale of shares of Common
      Stock
      owned or held by or for the account of the Company, but excluding shares of
      Common Stock deemed to have been issued or sold by the Company in connection
      with any Excluded Security) for a consideration per share less than a price
      equal to the Conversion Price in effect immediately prior to such issue or
      sale
      (such price the “Applicable
      Price”)
      (the
      foregoing a “Dilutive
      Issuance”),
      then
      immediately after such Dilutive Issuance the Conversion Price for purposes
      of
      Section 3(b)(ii)(x) then in effect shall be reduced to an amount equal to
      the product of (A) the Conversion Price for purposes of
      Section 3(b)(ii)(x) in effect immediately prior to such Dilutive Issuance
      and (B) the quotient determined by dividing (1)  the sum of
      (I) the product derived by multiplying the Conversion Price for purposes of
      Section 3(b)(ii)(x) in effect immediately prior to such Dilutive Issuance and
      the number of shares of Common Stock Deemed Outstanding immediately prior to
      such Dilutive Issuance plus (II) the consideration, if any, received by the
      Company upon such Dilutive Issuance, by (2) the product derived by
      multiplying (I) the Conversion Price for purposes of
      Section 3(b)(ii)(x) in effect immediately prior to such Dilutive Issuance
      by (II) the number of shares of Common Stock Deemed Outstanding immediately
      after such Dilutive Issuance. For purposes of determining the adjusted
      Conversion Price under this Section 7(a), the following shall be
      applicable:

     

    
      
        
        

      

      
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    (i)  Issuance
      of Options.
      If the
      Company in any manner grants or sells any Options and the lowest price per
      share
      for which one share of Common Stock is issuable upon the exercise of any such
      Option or upon conversion or exchange or exercise of any Convertible Securities
      issuable upon exercise of such Option is less than the Applicable Price, then
      such share of Common Stock shall be deemed to be outstanding and to have been
      issued and sold by the Company at the time of the granting or sale of such
      Option for such price per share. For purposes of this Section 7(a)(i), the
“lowest price per share for which one share of Common Stock is issuable upon
      the
      exercise of any such Option or upon conversion or exchange or exercise of any
      Convertible Securities issuable upon exercise of such Option” shall be equal to
      the sum of the lowest amounts of consideration (if any) received or receivable
      by the Company with respect to any one share of Common Stock upon granting
      or
      sale of the Option, upon exercise of the Option and upon conversion or exchange
      or exercise of any Convertible Security issuable upon exercise of such Option.
      No further adjustment of the Conversion Price shall be made upon the actual
      issuance of such share of Common Stock or of such Convertible Securities upon
      the exercise of such Options or upon the actual issuance of such Common Stock
      upon conversion or exchange or exercise of such Convertible
      Securities.

     

    (ii)  Issuance
      of Convertible Securities.
      If the
      Company in any manner issues or sells any Convertible Securities and the lowest
      price per share for which one share of Common Stock is issuable upon such
      conversion or exchange or exercise thereof is less than the Applicable Price,
      then such share of Common Stock shall be deemed to be outstanding and to have
      been issued and sold by the Company at the time of the issuance or sale of
      such
      Convertible Securities for such price per share. For the purposes of this
      Section 7(a)(ii), the “lowest price per share for which one share of Common
      Stock is issuable upon such conversion or exchange or exercise” shall be equal
      to the sum of the lowest amounts of consideration (if any) received or
      receivable by the Company with respect to any one share of Common Stock upon
      the
      issuance or sale of the Convertible Security and upon the conversion or exchange
      or exercise of such Convertible Security. No further adjustment of the
      Conversion Price shall be made upon the actual issuance of such share of Common
      Stock upon conversion or exchange or exercise of such Convertible Securities,
      and if any such issue or sale of such Convertible Securities is made upon
      exercise of any Options for which adjustment of the Conversion Price had been
      or
      are to be made pursuant to other provisions of this Section 7(a), no
      further adjustment of the Conversion Price shall be made by reason of such
      issue
      or sale.

     

    
      
        
        

      

      
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    (iii)  Change
      in Option Price or Rate of Conversion.
      If the
      purchase price provided for in any Options, the additional consideration, if
      any, payable upon the issue, conversion, exchange or exercise of any Convertible
      Securities, or the rate at which any Convertible Securities are convertible
      into
      or exchangeable or exercisable for Common Stock changes at any time, the
      Conversion Price in effect at the time of such change shall be adjusted to
      the
      Conversion Price which would have been in effect at such time had such Options
      or Convertible Securities provided for such changed purchase price, additional
      consideration or changed conversion rate, as the case may be, at the time
      initially granted, issued or sold. For purposes of this Section 7(a)(iii),
      if the terms of any Option or Convertible Security that was outstanding as
      of
      the Subscription Date are changed in the manner described in the immediately
      preceding sentence, then such Option or Convertible Security and the Common
      Stock deemed issuable upon exercise, conversion or exchange thereof shall be
      deemed to have been issued as of the date of such change. No adjustment shall
      be
      made if such adjustment would result in an increase of the Conversion Price
      then
      in effect.

     

    (iv)  Calculation
      of Consideration Received.
      In case
      any Option is issued in connection with the issue or sale of other securities
      of
      the Company, together comprising one integrated transaction in which no specific
      consideration is allocated to such Options by the parties thereto, the Options
      will be deemed to have been issued for the difference of (x) the aggregate
      fair market value of such Options and other securities issued or sold in such
      integrated transaction, less (y) the fair market value of the securities
      other than such Option, issued or sold in such transaction and the other
      securities issued or sold in such integrated transaction will be deemed to
      have
      been issued or sold for the balance of the consideration received by the
      Company. If any Common Stock, Options or Convertible Securities are issued
      or
      sold or deemed to have been issued or sold for cash, the consideration received
      therefor will be deemed to be the gross amount raised by the Company; provided,
      however, that such gross amount is not greater than 110% of the net amount
      received by the Company therefor. If any Common Stock, Options or Convertible
      Securities are issued or sold for a consideration other than cash, the amount
      of
      the consideration other than cash received by the Company will be the fair
      value
      of such consideration, except where such consideration consists of securities,
      in which case the amount of consideration received by the Company will be the
      Closing Sale Price of such securities on the date of receipt. If any Common
      Stock, Options or Convertible Securities are issued to the owners of the
      non-surviving entity in connection with any merger in which the Company is
      the
      surviving entity, the amount of consideration therefor will be deemed to be
      the
      fair value of such portion of the net assets and business of the non-surviving
      entity as is attributable to such Common Stock, Options or Convertible
      Securities, as the case may be. The fair value of any consideration other than
      cash or securities will be determined jointly by the Company and the Holder.
      If
      such parties are unable to reach agreement within ten (10) calendar days after
      the occurrence of an event requiring valuation (the “Valuation
      Event”),
      the
      fair value of such consideration will be determined within five (5) Business
      Days after the tenth (10th)
      calendar day following the Valuation Event by an independent, reputable
      appraiser jointly selected by the Company and the Holder. The determination
      of
      such appraiser shall be deemed binding upon all parties absent manifest error
      and the fees and expenses of such appraiser shall be borne by the
      Company.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

    (v)  Record
      Date.
      If the
      Company takes a record of the holders of Common Stock for the purpose of
      entitling them (A) to receive a dividend or other distribution payable in
      Common Stock, Options or in Convertible Securities or (B) to subscribe for
      or purchase Common Stock, Options or Convertible Securities, then such record
      date will be deemed to be the date of the issue or sale of the Common Stock
      deemed to have been issued or sold upon the declaration of such dividend or
      the
      making of such other distribution or the date of the granting of such right
      of
      subscription or purchase, as the case may be.

     

    (b)  Adjustment
      of Conversion Price upon Subdivision or Combination of Common
      Stock.
      If the
      Company at any time on or after the Subscription Date subdivides (by any stock
      split, stock dividend, recapitalization or otherwise) one or more classes of
      its
      outstanding shares of Common Stock into a greater number of shares, the
      Conversion Price in effect immediately prior to such subdivision will be
      proportionately reduced. If the Company at any time on or after the Subscription
      Date combines (by combination, reverse stock split or otherwise) one or more
      classes of its outstanding shares of Common Stock into a smaller number of
      shares, the Conversion Price in effect immediately prior to such combination
      will be proportionately increased.

     

    (c)  Other
      Events.
      If any
      event occurs of the type contemplated by the provisions of this Section 7
      but not expressly provided for by such provisions (including, without
      limitation, the granting of stock appreciation rights, phantom stock rights
      or
      other rights with equity features), then the Company’s Board of Directors (the
“Board”)
      will
      make an appropriate adjustment in the Conversion Price so as to protect the
      rights of the Holder under this Note; provided that no such adjustment will
      increase the Conversion Price as otherwise determined pursuant to this
      Section 7.

     

    (8)  NONCIRCUMVENTION.
      The
      Company hereby covenants and agrees that the Company will not, by amendment
      of
      its Articles of Incorporation, Bylaws or through any reorganization, transfer
      of
      assets, consolidation, merger, scheme of arrangement, 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 Note, and will at all
      times in good faith carry out all of the provisions of this Note and take all
      action as may be required to protect the rights of the Holder of this
      Note.

     

    (9)  RESERVATION
      OF AUTHORIZED SHARES.

     

    (a)  Reservation.
      The
      Company shall initially reserve out of its authorized and unissued Common Stock
      a number of shares of Common Stock equal to 130% of the Conversion Rate with
      respect to the Conversion Amount of the Note as of the Issuance Date. So long
      as
      the Note is outstanding, the Company shall take all action necessary to reserve
      and keep available out of its authorized and unissued Common Stock, solely
      for
      the purpose of effecting the conversion of the Note, 130% of the number of
      shares of Common Stock as shall from time to time be necessary to effect the
      conversion of the Note; provided that at no time shall the number of shares
      of
      Common Stock so reserved be less than the number of shares required to be
      reserved by the previous sentence (without regard to any limitations on
      conversions) (the “Required
      Reserve Amount”).

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    (b)  Insufficient
      Authorized Shares.
      If at
      any time while the Note remains outstanding the Company does not have a
      sufficient number of authorized and unreserved shares of Common Stock to satisfy
      its obligation to reserve for issuance upon conversion of the Note at least
      a
      number of shares of Common Stock equal to the Required Reserve Amount (an
“Authorized
      Share Failure”),
      then
      the Company shall immediately take all action necessary to increase the
      Company’s authorized shares of Common Stock to an amount sufficient to allow the
      Company to reserve the Required Reserve Amount. Without limiting the generality
      of the foregoing sentence, as soon as practicable after the date of the
      occurrence of an Authorized Share Failure, but in no event later than
      ninety (90) calendar days after the occurrence of such Authorized Share
      Failure, the Company shall hold a meeting of its stockholders for the approval
      of an increase in (the “Authorized
      Share Failure Deadline”),
      the
      number of authorized shares of Common Stock. In connection with such meeting,
      the Company shall provide each stockholder with a proxy statement and shall
      use
      its best efforts to solicit its stockholders’ approval of such increase in
      authorized shares of Common Stock and to cause the Board to recommend to the
      stockholders that they approve such proposal.

     

    (10)  COVENANTS.

     

    (a)  Rank.
      All
      payments due under this Note shall be senior to all other Indebtedness of the
      Company and its Subsidiaries other than Permitted Indebtedness of the type
      described in clause (iii) of the definition thereof.

     

    (b)  Incurrence
      of Indebtedness.
      So long
      as this Note is outstanding, the Company shall not, and the Company shall not
      permit any of its Subsidiaries to, directly or indirectly, incur or guarantee,
      assume or suffer to exist any Indebtedness, other than (i) the Indebtedness
      evidenced by this Note and the Subsidiary Note and (ii) other Permitted
      Indebtedness.

     

    (c)  Existence
      of Liens.
      So long
      as this Note is outstanding, the Company shall not, and the Company shall not
      permit any of its Subsidiaries to, directly or indirectly, allow or suffer
      to
      exist any mortgage, lien, pledge, charge, security interest or other encumbrance
      upon or in any property or assets (including accounts and contract rights)
      owned
      by the Company or any of its Subsidiaries (collectively, “Liens”)
      other
      than Permitted Liens.

     

    (d)  Restricted
      Payments.
      The
      Company shall not, and the Company shall not permit any of its Subsidiaries
      to,
      (i) directly or indirectly, redeem, defease, repurchase, repay or make any
      payments in respect of, by the payment of cash or cash equivalents (in whole
      or
      in part, whether by way of open market purchases, tender offers, private
      transactions or otherwise), all or any portion of any Permitted Indebtedness,
      whether by way of payment in respect of principal of (or premium, if any) or
      interest on, such Indebtedness if at the time such payment is due or is
      otherwise made or, after giving effect to such payment, (i) an event
      constituting an Event of Default has occurred and is continuing or (ii) an
      event that with the passage of time and without being cured would constitute
      an
      Event of Default has occurred and is continuing, or (iii) make any payments
      to Turnaround Partners, Inc. (“TAP”),
      Corporate Strategies, Inc. (“CSI”)
      or any
      of their members, partners, employees, stockholders, or any of their respective
      affiliates, except (1) with the prior consent of the Holder,
      (2) pursuant to either that certain Employment Agreement, dated as of the
      date hereof, by and among the Company and Fred S. Zeidman or that certain
      Agreement, dated as of the date hereof, by and among the Company, Timothy J.
      Connolly on behalf of CSI, and the Holder (relating to the payment to
Turnaround
      Partners, Inc., an affiliate of the Company, of
      shares
      of
      common stock of INII representing ten percent (10%) of the common stock of
      INII
      outstanding as of the date hereof),
      in
      each case as in effect on the date hereof, (3) reasonable rent and overhead
      charges allocable to the Company in respect of shared space with CSI,
      (4) so long as Mr. Connolly is serving as CEO of the Company, the
      reimbursement to Mr. Connolly for all direct expenses incurred by Mr. Connolly
      in connection with such service and (5) payments by CSI Business Finance,
      Inc. (“CSIBF”)
      to Mr.
      Connolly for compensation payable to Mr. Connolly solely out of cash generated
      from CSIBF’s operations.

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    (e)  Restriction
      on Redemption and Cash Dividends.
      Until
      the Note has been converted, redeemed or otherwise satisfied in full in
      accordance with its terms, the Company shall not, directly or indirectly,
      redeem, repurchase, or declare or pay any cash dividend or distribution on,
      its
      capital stock without the prior express written consent of the
      Holder.

     

    (f)  Restriction
      on Mergers, Etc..
      Until
      the Note has been converted, redeemed or otherwise satisfied in full in
      accordance with its terms, the Company shall not, directly or indirectly, (i)
      subject to Section 5 of this Note, merge, dissolve, liquidate, consolidate
      with
      or into another person, or dispose of or otherwise transfer (whether in one
      transaction or in a series of transactions) all or substantially all of its
      assets (whether now owned or hereafter acquired) to or in favor of any person,
      or (ii) acquire any assets or business or any interest in any person or entity
      in excess of $100,000, except for purchases of inventory, raw materials and
      equipment in the ordinary course of business.

     

    (g)  Financial
      Covenants.

     

    (i)  EBITDA
      Test.
      So long
      as this Note is outstanding, for each accounting period identified on
Exhibit
      C
      hereto,
      the Company shall maintain EBITDA for such accounting period which equals or
      exceeds the applicable EBITDA Threshold for such accounting period (the
“EBITDA
      Test”).

     

    (ii)  Operating
      Results Announcement.
      The
      Company shall announce its operating results (the “Operating
      Results”)
      from
      which compliance with the EBITDA Test can be determined for each accounting
      period no later than the forty-fifth (45th)
      calendar day after the end of the applicable accounting period or, with respect
      to any fiscal year, the ninetieth (90th)
      calendar day after the end of such fiscal year (the “Announcement
      Date”)
      and,
      in the event the Company shall have satisfied the EBITDA Test at all times
      during the applicable accounting period, such announcement shall include a
      statement to the effect that the Company satisfied the EBITDA Test at all times
      throughout such accounting period; provided, however, that in the event the
      Company is delayed in announcing its Operating Results for any accounting
      period, by the Announcement Date the Company shall, in lieu of the foregoing,
      (A) make a statement to the effect that it has complied with all of its
      covenants under the Note, including, without limitation, the EBITDA Test, and
      (B) provide to the Holder a certification, in accordance with terms of the
      next sentence, certifying the same. On the Announcement Date, the Company shall
      also provide to the Holder a certification, executed on behalf of the Company
      by
      the Chief Financial Officer of the Company, certifying that the Company
      satisfied the EBITDA Test at all times throughout the applicable accounting
      period.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

    Until
      the
      Note has been converted, redeemed or otherwise satisfied in full in accordance
      with its terms, the Company shall not, directly or indirectly, redeem,
      repurchase or declare or pay any cash dividend or distribution on its capital
      stock without the prior express written consent of the Holder.

     

    (11)  PARTICIPATION.
      The
      Holder, as the holder of this Note, shall be entitled to receive such dividends
      paid and distributions made to the holders of Common Stock to the same extent
      as
      if the Holder had converted this Note into Common Stock (without regard to
      any
      limitations on conversion herein or elsewhere) and had held such shares of
      Common Stock on the record date for such dividends and distributions. Payments
      under the preceding sentence shall be made concurrently with the dividend or
      distribution to the holders of Common Stock.

     

    (12)  AMENDMENT.
      No
      provision of this Note or the Subsidiary Note shall be altered, amended or
      waived without the prior written consent of the Holder.

     

    (13)  TRANSFER.
      This
      Note and any shares of Common Stock issued upon conversion of this Note may
      be
      offered, sold, assigned or transferred by the Holder without the consent of
      the
      Company, subject only to the provisions of applicable securities
      laws.

     

    (14)  REISSUANCE
      OF THIS NOTE.

     

    (a)  Transfer.
      If this
      Note is to be transferred, the Holder shall surrender this Note to the Company,
      whereupon the Company will, subject to the satisfaction of the transfer
      provisions of applicable securities laws, forthwith issue and deliver upon
      the
      order of the Holder a new Note (in accordance with subsection (d) of this
      Section), registered in the name of the registered transferee or assignee,
      representing the outstanding Principal being transferred by the Holder and,
      if
      less then the entire outstanding Principal is being transferred, a new Note
      (in
      accordance with subsection (d) of this Section) to the Holder representing
      the
      outstanding Principal not being transferred.

     

    (b)  Lost,
      Stolen or Mutilated Note.
      Upon
      receipt by the Company of evidence reasonably satisfactory to the Company of
      the
      loss, theft, destruction or mutilation of this Note, and, in the case of loss,
      theft or destruction, of any indemnification undertaking by the Holder to the
      Company in customary form and, in the case of mutilation, upon surrender and
      cancellation of this Note, the Company shall execute and deliver to the Holder
      a
      new note (in accordance with subsection (d) of this Section) representing the
      outstanding Principal.

     

    (c)  Note
      Exchangeable for Different Denominations.
      This
      Note is exchangeable, upon the surrender hereof by the Holder at the principal
      office of the Company, for a new note or notes (in accordance with subsection
      (d) of this Section) representing in the aggregate the outstanding Principal
      of
      this Note, and each such new Note will represent such portion of such
      outstanding Principal as is designated by the Holder at the time of such
      surrender.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

    (d)  Issuance
      of New Notes.
      Whenever the Company is required to issue a new note pursuant to the terms
      of
      this Note, such new note (i) shall be of like tenor with this Note,
      (ii) shall represent, as indicated on the face of such new Note, the
      Principal remaining outstanding (or in the case of a new Note being issued
      pursuant to subsection (a) or (c) of this Section), the Principal designated
      by
      the Holder which, when added to the principal represented by the other new
      Notes
      issued in connection with such issuance, does not exceed the Principal remaining
      outstanding under this Note immediately prior to such issuance of new Notes),
      (iii) shall have an issuance date, as indicated on the face of such new
      Note, which is the same as the Issuance Date of this Note, (iv) shall have
      the same rights and conditions as this Note, and (v) shall represent
      accrued and unpaid Interest and Late Charges on the Principal and Interest
      of
      this Note, from the Issuance Date.

     

    (15)  REMEDIES,
      CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE
      RELIEF.
      The
      remedies provided in this Note shall be cumulative and in addition to all other
      remedies available under this Note and any of the other Transaction Documents
      at
      law or in equity (including a decree of specific performance and/or other
      injunctive relief), and nothing herein shall limit the Holder’s right to pursue
      actual and consequential damages for any failure by the Company to comply with
      the terms of this Note. Amounts set forth or provided for herein with respect
      to
      payments, conversion and the like (and the computation thereof) shall be the
      amounts to be received by the Holder and shall not, except as expressly provided
      herein, be subject to any other obligation of the Company (or the performance
      thereof). The Company acknowledges that a breach by it of its obligations
      hereunder will cause irreparable harm to the Holder and that the remedy at
      law
      for any such breach may be inadequate. The Company therefore agrees that, in
      the
      event of any such breach or threatened breach, the Holder shall be entitled,
      in
      addition to all other available remedies, to an injunction restraining any
      breach, without the necessity of showing economic loss and without any bond
      or
      other security being required.

     

    (16)  PAYMENT
      OF COLLECTION, ENFORCEMENT AND OTHER COSTS.
      If
      (a) this Note is placed in the hands of an attorney for collection or
      enforcement or is collected or enforced through any legal proceeding or the
      Holder otherwise takes action to collect amounts due under this Note or to
      enforce the provisions of this Note or (b) there occurs any bankruptcy,
      reorganization, receivership of the Company or other proceedings affecting
      Company creditors’ rights and involving a claim under this Note, then the
      Company shall pay the costs incurred by the Holder for such collection,
      enforcement or action or in connection with such bankruptcy, reorganization,
      receivership or other proceeding, including, but not limited to, attorneys’ fees
      and disbursements.

     

    (17)  CONSTRUCTION;
      HEADINGS.
      This
      Note shall be deemed to be jointly drafted by the Company and the Holder and
      shall not be construed against any person as the drafter hereof. The headings
      of
      this Note are for convenience of reference and shall not form part of, or affect
      the interpretation of, this Note.

     

    
      
        
        

      

      
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    (18)  FAILURE
      OR INDULGENCE NOT WAIVER.
      No
      failure or delay on the part of the Holder in the exercise of any power, right
      or privilege hereunder shall operate as a waiver thereof, nor shall any single
      or partial exercise of any such power, right or privilege preclude other or
      further exercise thereof or of any other right, power or privilege.

     

    (19)  DISPUTE
      RESOLUTION.
      In the
      case of a dispute as to the determination of the Closing Bid Price, the Closing
      Sale Price or the Weighted Average Price or the arithmetic calculation of the
      Conversion Rate or any Redemption Price, the Company shall submit the disputed
      determinations or arithmetic calculations via facsimile within five (5)
      Business Days of receipt, or deemed receipt, of the Conversion Notice or
      Redemption Notice or other event giving rise to such dispute, as the case may
      be, to the Holder. If the Holder and the Company are unable to agree upon such
      determination or calculation within five (5) Business Days of such disputed
      determination or arithmetic calculation being submitted to the Holder, then
      the
      Company shall, within two (2) Business Days submit via facsimile
      (a) the disputed determination of the Closing Bid Price, the Closing Sale
      Price or the Weighted Average Price to an independent, reputable investment
      bank
      selected by the Company and approved by the Holder or (b) the disputed
      arithmetic calculation of the Conversion Rate or any Redemption Price to the
      Company’s independent, outside accountant. The Company, at the Company’s
      expense, shall cause the investment bank or the accountant, as the case may
      be,
      to perform the determinations or calculations and notify the Company and the
      Holder of the results no later than five (5) Business Days from the time it
      receives the disputed determinations or calculations. Such investment bank’s or
      accountant’s determination or calculation, as the case may be, shall be binding
      upon all parties absent demonstrable error.

     

    (20)  NOTICES;
      PAYMENTS.

     

    (a)  Notices.
      Whenever notice is required to be given under this Note, unless otherwise
      provided herein, such notice shall be given in accordance with the Securities
      Purchase Agreement. The Company shall provide the Holder with prompt written
      notice of all actions taken pursuant to this Note, including in reasonable
      detail a description of such action and the reason therefore. Without limiting
      the generality of the foregoing, the Company will give written notice to the
      Holder (i) immediately upon any adjustment of the Conversion Price, setting
      forth in reasonable detail, and certifying, the calculation of such adjustment
      and (ii) at least twenty (20) days prior to the date on which the
      Company closes its books or takes a record (A) with respect to any dividend
      or distribution upon the Common Stock, (B) with respect to any pro rata
      subscription offer to holders of Common Stock or (C) for determining rights
      to vote with respect to any Fundamental Transaction, dissolution or liquidation,
      provided in each case that such information shall be made known to the public
      prior to or in conjunction with such notice being provided to the
      Holder.

     

    (b)  Payments.
      Whenever any payment of cash is to be made by the Company to any Person pursuant
      to this Note, such payment shall be made in lawful money of the United States
      of
      America by a check drawn on the account of the Company and sent via overnight
      courier service to such Person at such address as previously provided to the
      Company in writing; provided that the Holder may elect to receive a payment
      of
      cash via wire transfer of immediately available funds by providing the Company
      with prior written notice setting out such request and the Holder’s wire
      transfer instructions. Whenever any amount expressed to be due by the terms
      of
      this Note is due on any day which is not a Business Day, the same shall instead
      be due on the next succeeding day which is a Business Day and, in the case
      of
      any Interest Date which is not the date on which this Note is paid in full,
      the
      extension of the due date thereof shall not be taken into account for purposes
      of determining the amount of Interest due on such date. Any amount of Principal
      or other amounts due under the Transaction Documents, other than Interest,
      which
      is not paid when due shall result in a late charge being incurred and payable
      by
      the Company in an amount equal to interest on such amount at the rate of twenty
      percent (20%) per annum from the date such amount was due until the same is
      paid in full (“Late
      Charge”).

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

    (21)  CANCELLATION.
      After
      all Principal, accrued Interest and other amounts at any time owed on this
      Note
      have been paid in full, this Note shall automatically be deemed canceled, shall
      be surrendered to the Company for cancellation and shall not be
      reissued.

     

    (22)  WAIVER
      OF NOTICE.
      To the
      extent permitted by law, the Company hereby waives demand, notice, protest
      and
      all other demands and notices in connection with the delivery, acceptance,
      performance, default or enforcement of this Note and the Securities Purchase
      Agreement.

     

    (23)  GOVERNING
      LAW.
      This
      Note shall be construed and enforced in accordance with, and all questions
      concerning the construction, validity, interpretation and performance of this
      Note shall be governed by, the internal laws of the State of New Jersey, without
      giving effect to any choice of law or conflict of law provision or rule (whether
      of the State of New Jersey or any other jurisdictions) that would cause the
      application of the laws of any jurisdictions other than the State of New Jersey.
      The Company hereby irrevocably submits to the exclusive jurisdiction of the
      state and federal courts sitting in the City of Jersey City, New Jersey for
      the
      adjudication of any dispute hereunder or in connection herewith or with any
      transaction contemplated hereby or discussed herein, and hereby irrevocably
      waives, and agrees not to assert in any suit, action or proceeding, any claim
      that it is not personally subject to the jurisdiction of any such court, that
      such suit, action or proceeding is brought in an inconvenient forum or that
      the
      venue of such suit, action or proceeding is improper. Nothing contained herein
      shall be deemed to limit in any way any right to serve process in any manner
      permitted by law. In the event that any provision of this Note is invalid or
      unenforceable under any applicable statute or rule of law, then such provision
      shall be deemed inoperative to the extent that it may conflict therewith and
      shall be deemed modified to conform with such statute or rule of law. Any such
      provision which may prove invalid or unenforceable under any law shall not
      affect the validity or enforceability of any other provision of this Note.
      Nothing contained herein shall be deemed or operate to preclude the Holder
      from
      bringing suit or taking other legal action against the Company in any other
      jurisdiction to collect on the Company’s obligations to the Holder, to realize
      on any collateral or any other security for such obligations, or to enforce
      a
      judgment or other court ruling in favor of the Holder. THE
      COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
      REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
      CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED
      HEREBY.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    (24)  DISCLOSURE.
      Upon
      receipt or delivery by the Company of any notice in accordance with the terms
      of
      this Note, unless the Company has in good faith determined that the matters
      relating to such notice do not constitute material, nonpublic information
      relating to the Company or its Subsidiaries, the Company shall within
      four (4) Business Days after any such receipt or delivery publicly disclose
      such material, nonpublic information on a Current Report on Form 8-K or
      otherwise. In the event that the Company believes that a notice contains
      material, nonpublic information relating to the Company or its Subsidiaries,
      the
      Company so shall indicate to the Holder contemporaneously with delivery of
      such
      notice, and in the absence of any such indication, the Holder shall be allowed
      to presume that all matters relating to such notice do not constitute material,
      nonpublic information relating to the Company or its Subsidiaries. In the event
      of a breach of the foregoing covenant by the Company, any of its Subsidiaries,
      or any of its or their respective officers, directors, employees and agents,
      in
      addition to any other remedy provided herein or in the Transaction Documents,
      the Holder shall have the right to make a public disclosure, in the form of
      a
      press release, public advertisement or otherwise, of such material, nonpublic
      information without the prior approval by the Company, its Subsidiaries, or
      any
      of its or their respective officers, directors, employees or agents. The Holder
      shall have no liability to the Company, its Subsidiaries, or any of its or
      their
      respective officers, directors, employees, stockholders or agents for any such
      disclosure.

     

    [Signature
      Page Follows]

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the Company has caused this Secured Convertible Note to be
      duly
      executed as of the Issuance Date set out above.

     

    
      	 	 	 
	 	
              NATURAL
                NUTRITION, INC.

            
	 
 	 
 	 
 
	 	By:  	/s/ Timothy
              J. Connolly
	 	
              
                

              

              Name: Timothy
                J. Connolly

              Title: Chief
                Executive Officer

            

    

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    Exhibit
      A - Certain Definitions

     

    For
      purposes of the Secured Convertible Note dated May 31, 2007 issued by
      Natural Nutrition, Inc. to Cornell Capital Partners, L.P., the following terms
      shall have the following meanings:

     

    (a) “Approved
      Stock Plan”
means
      any employee benefit plan which has been approved by the Board of Directors
      of
      the Company, pursuant to which the Company’s securities may be issued to any
      employee, consultant, officer or director for services provided to the Company;
      provided, that, as a condition to any issuances thereunder, each grantee shall
      enter into an agreement substantially in the form of the Lock-Up Agreements.
      The
      foregoing lock-up shall not apply to grantees who are independent directors,
      employees or consultants provided they are not affiliated with TAP, CSI, or
      any
      of their members, partners, stockholders, or any of their respective
      affiliates.

     

    (b) “Bloomberg”
means
      Bloomberg Financial Markets.

     

    (c) “Business
      Day”
means
      any day other than Saturday, Sunday or other day on which commercial banks
      in
      the City of Newark, New Jersey are authorized or required by law to remain
      closed.

     

    (d) “Change
      of Control”
means
      any Fundamental Transaction other than (i) any reorganization,
      recapitalization or reclassification of the Common Stock or business combination
      in which the Company is the publicly traded surviving entity in which holders
      of
      the Company’s voting power immediately prior to such reorganization,
      recapitalization or reclassification or business combination continue after
      such
      reorganization, recapitalization or reclassification or business combination
      to
      hold publicly traded securities and, directly or indirectly, the voting power
      of
      the surviving entity or entities necessary to elect a majority of the members
      of
      the board of directors (or their equivalent if other than a corporation) of
      such
      entity or entities, or (ii) pursuant to a migratory merger effected solely
      for the purpose of changing the jurisdiction of incorporation of the
      Company.

     

    (e) “Closing
      Bid Price”
and
      “Closing
      Sale Price”
means,
      for any security as of any date, the last closing bid price and last closing
      trade price, respectively, for such security on the Principal Market, as
      reported by Bloomberg, or, if the Principal Market begins to operate on an
      extended hours basis and does not designate the closing bid price or the closing
      trade price, as the case may be, then the last bid price or last trade price,
      respectively, of such security prior to 4:00:00 p.m., New York Time, as reported
      by Bloomberg, or, if the Principal Market is not the principal securities
      exchange or trading market for such security, the last closing bid price or
      last
      trade price, respectively, of such security on the principal securities exchange
      or trading market where such security is listed or traded as reported by
      Bloomberg, or if the foregoing do not apply, the last closing bid price or
      last
      trade price, respectively, of such security in the over-the-counter market
      on
      the electronic bulletin board for such security as reported by Bloomberg, or,
      if
      no closing bid price or last trade price, respectively, is reported for such
      security by Bloomberg, the average of the bid prices, or the ask prices,
      respectively, of any market makers for such security as reported in the
“pink
      sheets”
by
      Pink
      Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Closing Bid
      Price or the Closing Sale Price cannot be calculated for a security on a
      particular date on any of the foregoing bases, the Closing Bid Price or the
      Closing Sale Price, as the case may be, of such security on such date shall
      be
      the fair market value as mutually determined by the Company and the Holder.
      If
      the Company and the Holder are unable to agree upon the fair market value of
      such security, then such dispute shall be resolved pursuant to Section 19.
      All such determinations to be appropriately adjusted for any stock dividend,
      stock split, stock combination or other similar transaction during the
      applicable calculation period.

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

    (f) “Closing
      Date”
shall
      have the meaning set forth in the Securities Purchase Agreement, which date
      is
      the date the Company initially issued the Note pursuant to the terms of the
      Securities Purchase Agreement.

     

    (g) “Common
      Stock Deemed Outstanding”
means,
      at any given time, the number of shares of Common Stock outstanding at such
      time, plus the number of shares of Common Stock deemed to be outstanding
      pursuant to Sections 7(a)(i) and 7(a)(ii) hereof regardless of whether the
      Options or Convertible Securities are actually exercisable at such time, but
      excluding any Common Stock owned or held by or for the account of the Company
      or
      issuable upon conversion or exercise, as applicable, of the Note and the
      Warrant.

     

    (h) “Consolidated
      Net Income”
means,
      for any applicable period, the net income (loss) of the Company and its
      Subsidiaries for such period, determined on a consolidated basis and in
      accordance with GAAP, but excluding from the determination of Consolidated
      Net
      Income (without duplication) (a) any extraordinary or non recurring gains
      or losses or gains or losses from Dispositions, (b) restructuring charges,
      (c) any tax refunds, net operating losses or other net tax benefits,
      (d) effects of discontinued operations and (e) interest income
      (including interest paid-in-kind).

     

    (i) “Consolidated
      Net Interest Expense”
means,
      for any applicable period, gross interest expense of the Company and its
      Subsidiaries for such period determined on a consolidated basis and in
      accordance with GAAP, less (i) the sum of (A) interest income for such
      period and (B) gains for such period on Hedging Agreements (to the extent
      not included in interest income above and to the extent not deducted in the
      calculation of gross interest expense), plus (ii) the sum of
      (A) losses for such period on Hedging Agreements (to the extent not
      included in gross interest expense) and (B) the upfront costs or fees for
      such period associated with Hedging Agreements (to the extent not included
      in
      gross interest expense), in each case, determined on a consolidated basis and in
      accordance with GAAP.

     

    (j) “Contingent
      Obligation”
means,
      as to any Person, any direct or indirect liability, contingent or otherwise,
      of
      that Person with respect to any Indebtedness, lease, dividend or other
      obligation of another Person if the primary purpose or intent of the Person
      incurring such liability, or the primary effect thereof, is to provide assurance
      to the obligee of such liability that such liability will be paid or discharged,
      or that any agreements relating thereto will be complied with, or that the
      holders of such liability will be protected (in whole or in part) against loss
      with respect thereto.

     

    (k) “Convertible
      Securities”
means
      any stock or securities (other than Options) directly or indirectly convertible
      into or exercisable or exchangeable for Common Stock.

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

    (l) “EBITDA”
means,
      with respect to any Person and its Subsidiaries for any accounting period,
      the
      Consolidated Net Income of such Person and its Subsidiaries as set forth in
      the
      financial statements of the Company contained in the Company’s Quarterly Report
      on Form 10-QSB or Company’s Annual Report on Form 10-KSB of the
      Company for the applicable accounting period, plus without duplication, the
      sum
      of the following amounts of the Company and its Subsidiaries for such accounting
      period to the extent deducted in determining Consolidated Net Income of such
      Persons for such accounting period: (i) Consolidated Net Interest Expense,
      (ii) income tax expense, (iii) depreciation expense and
      (iv) amortization expense.

     

    (m) “EBITDA
      Threshold”
means,
      (x) for each annual accounting period set forth on Exhibit C hereto, 90% of
      the projected EBITDA target for such annual accounting period as set forth
      on
      such Exhibit, and (y) for each three, six and nine month accounting period
      set
      forth on Exhibit C hereto, 80% of the projected EBITDA target for each such
      three, six and nine month accounting period set forth on such
      Exhibit.

     

    (n) “Eligible
      Market”
means
      the Principal Market, The New York Stock Exchange, Inc., the American Stock
      Exchange, the Nasdaq National Market, the Nasdaq Capital Market or the pink
      sheets (as reported by Pink Sheets LLC).

     

    (o) “Equity
      Value Redemption Premium”
means
      120%.

     

    (p) “Excluded
      Securities”
means
      any Common Stock issued or issuable: (i) in connection with any Approved
      Stock Plan; (ii) upon conversion, adjustment or redemption of the Note or
      the exercise of the Warrant; (iii) pursuant to a bona fide firm commitment
      underwritten public offering with a nationally recognized underwriter which
      generates gross proceeds to the Company in excess of $50,000,000 (other than
      an
“at-the-market
      offering”
as
      defined in Rule 415(a)(4) under the 1933 Act and “equity
      lines”);
      (iv) in connection with any acquisition by the Company, whether through an
      acquisition of stock or a merger of any business, assets or technologies the
      primary purpose of which is not to raise equity capital; (v) in connection
      with any other strategic transaction or alliance the primary purpose of which
      is
      not to raise equity capital, and (vi) upon conversion or exercise of any
      Options or Convertible Securities which are outstanding on the day immediately
      preceding the Subscription Date, provided that the conversion or exercise price
      of such Options or Convertible Securities is not amended, modified or changed
      on
      or after the Subscription Date.

     

    (q) “Fundamental
      Transaction”
means
      that the Company shall, directly or indirectly, in one or more related
      transactions, (i) consolidate or merge with or into (whether or not the
      Company is the surviving corporation) another Person or Persons, or
      (ii) sell, assign, transfer, convey or otherwise dispose of all or
      substantially all of the properties or assets of the Company to another Person,
      or (iii) allow another Person to make a purchase, tender or exchange offer
      that is accepted by the holders of more than 50% of the outstanding shares
      of
      Voting Stock (not including any shares of Voting Stock held by the Person or
      Persons making or party to, or associated or affiliated with the Persons making
      or party to, such purchase, tender or exchange offer), or (iv) consummate a
      stock purchase agreement or other business combination (including, without
      limitation, a reorganization, recapitalization, spin-off or scheme of
      arrangement) with another Person whereby such other Person acquires more than
      the 50% of the outstanding shares of Voting Stock (not including any shares
      of
      Voting Stock held by the other Person or other Persons making or party to,
      or
      associated or affiliated with the other Persons making or party to, such stock
      purchase agreement or other business combination), or (v) reorganize,
      recapitalize or reclassify its Common Stock, or (vi) any “person”
or
      “group”
(as
      these terms are used for purposes of Sections 13(d) and 14(d) of the 1934
      Act) is or shall become the “beneficial
      owner”
(as
      defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of 50%
      of the aggregate Voting Stock of the Company.

     

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

    (r) “GAAP”
means
      United States generally accepted accounting principles, consistently
      applied.

     

    (s) “Indebtedness”
of
      any
      Person means, without duplication (i) all indebtedness for borrowed money,
      (ii) all obligations issued, undertaken or assumed as the deferred purchase
      price of property or services, including (without limitation) “capital
      leases”
in
      accordance with GAAP (other than trade payables entered into in the ordinary
      course of business), (iii) all reimbursement or payment obligations with
      respect to letters of credit, surety bonds and other similar instruments,
      (iv) all obligations evidenced by notes, bonds, debentures or similar
      instruments, including obligations so evidenced incurred in connection with
      the
      acquisition of property, assets or businesses, (v) all indebtedness created
      or arising under any conditional sale or other title retention agreement, or
      incurred as financing, in either case with respect to any property or assets
      acquired with the proceeds of such indebtedness (even though the rights and
      remedies of the seller or bank under such agreement in the event of default
      are
      limited to repossession or sale of such property), (vi) all monetary
      obligations under any leasing or similar arrangement which, in connection with
      GAAP, consistently applied for the periods covered thereby, is classified as
      a
      capital lease, (vii) all indebtedness referred to in clauses (i)
      through (vi) above secured by (or for which the holder of such Indebtedness
      has
      an existing right, contingent or otherwise, to be secured by) any mortgage,
      lien, pledge, charge, security interest or other encumbrance upon or in any
      property or assets (including accounts and contract rights) owned by any Person,
      even though the Person which owns such assets or property has not assumed or
      become liable for the payment of such indebtedness, and (viii) all
      Contingent Obligations in respect of indebtedness or obligations of others
      of
      the kinds referred to in clauses (i) through (vii) above.

     

    (t) “INII”
means
      Interactive Nutrition International, Inc., a company incorporated under the
      laws
      of Canada and wholly-owned subsidiary of the Company.

     

    (u) “Installment
      Amount”
means
      with respect to any Installment Date, Cdn $375,000, together with and accrued
      and unpaid Late Charges, if any, with respect to such Principal amount and
      any
      interest thereon.

     

    (v) “Installment
      Date”
means
      each January 1, April 1, July 1 and October 1 of each
      calendar year while this Note is outstanding from and after (and including)
      January 1, 2008.

     

    (w) “Interest
      Rate”
means,
      initially twelve percent (12%) per annum, subject to adjustment as provided
      herein.

     

    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

    (x) “Options”
means
      any rights, warrants or options to subscribe for or purchase shares of Common
      Stock or Convertible Securities.

     

    (y) “Parent
      Entity”
of
      a
      Person means an entity that, directly or indirectly, controls the applicable
      Person and whose common stock or equivalent equity security is quoted or listed
      on an Eligible Market, or, if there is more than one such Person or Parent
      Entity, the Person or Parent Entity with the largest public market
      capitalization as of the date of consummation of the Fundamental
      Transaction.

     

    (z) “Permitted
      Indebtedness”
means
      (i) the Indebtedness evidenced by this Note, (ii) the Cornell Debenture (as
      such
      term is defined in the Securities Purchase Agreement) and the related
      transactions in connection therewith, (iii) the INII Vendor Debt (as such term
      is defined in the Securities Purchase Agreement), and (iv) total Indebtedness
      of
      the Company not to exceed $500,000 in the aggregate outstanding at any one
      time;
      provided such Indebtedness permitted pursuant to clause (iv) hereof shall be
      made expressly subordinate in right of payment to the Indebtedness evidenced
      by
      this Note, as reflected in a written agreement approved by the Holder in
      writing.

     

    (aa) “Permitted
      Liens”
means
      (i) other than the INII Tax Liens, any Lien for taxes not yet due or delinquent
      or being contested in good faith by appropriate proceedings for which adequate
      reserves have been established in accordance with GAAP, (ii) any statutory
      Lien arising in the ordinary course of business by operation of law with respect
      to a liability that is not yet due or delinquent, (iii) any Lien created by
      operation of law, such as materialmen’s liens, mechanics’ liens and other
      similar liens, arising in the ordinary course of business with respect to a
      liability that is not yet due or delinquent or that are being contested in
      good
      faith by appropriate proceedings, (iv) Liens (A) upon or in any
      equipment (as defined in the Security Agreement) acquired or held by the Company
      or any of its Subsidiaries to secure the purchase price of such equipment or
      indebtedness incurred solely for the purpose of financing the acquisition or
      lease of such equipment, or (B) existing on such equipment at the time of
      its acquisition, provided that the Lien is confined solely to the property
      so
      acquired and improvements thereon, and the proceeds of such equipment, (v)
      leases or subleases and licenses and sublicenses granted to others in the
      ordinary course of the Company’s business, not interfering in any material
      respect with the business of the Company and its Subsidiaries taken as a whole
      and (vi) the INII Tax Liens (as such term is defined in the Securities Purchase
      Agreement).

     

    (bb) “Person”
means
      an individual, a limited liability company, a partnership, a joint venture,
      a
      corporation, a trust, an unincorporated organization, any other entity and
      a
      government or any department or agency thereof.

     

    (cc) “Principal
      Market”
means
      the OTC Bulletin Board.

     

    (dd) “Redemption
      Premium”
means
      120%.

     

    (ee) “Registration
      Rights Agreement”
means
      that certain registration rights agreement dated as of the Subscription Date
      by
      and among the Company and the initial Holder of the Note relating to, among
      other things, the registration of the resale of the Common Stock issuable upon
      conversion of the Note and exercise of the Warrant.

     

    
      
        
        

      

      
        -25-

        
          

        

      

      
        
        

      

    

    (ff) “SEC”
means
      the United States Securities and Exchange Commission.

     

    (gg) “Securities
      Purchase Agreement”
means
      that certain securities purchase agreement, dated as of the Subscription Date,
      by and between the Company and the initial Holder of the Note pursuant to which
      the Company issued the Note and Warrant.

     

    (hh) “Subsidiary
      Note”
means
      the Convertible Promissory Note, dated March 31, 2004, originally issued to
      Nesracorp Inc. (under its former name Interactive Nutrition, Inc.) jointly
      by
      Bio-One Corporation and INII in the principal amount of $15,000,000, as such
      note may be amended from time to time. Such note has since been purchased by
      the
      Company.

     

    (ii) “Subscription
      Date”
means
      the original issue date of this Note.

     

    (jj) “Successor
      Entity”
means
      the Person, which may be the Company, formed by, resulting from or surviving
      any
      Fundamental Transaction or the Person with which such Fundamental Transaction
      shall have been made, provided that if such Person is not a publicly traded
      entity whose common stock or equivalent equity security is quoted or listed
      for
      trading on an Eligible Market, Successor Entity shall mean such Person’s Parent
      Entity.

     

    (kk) “Trading
      Day”
means
      any day on which the Common Stock is traded on the Principal Market, or, if
      the
      Principal Market is not the principal trading market for the Common Stock,
      then
      on the principal securities exchange or securities market on which the Common
      Stock is then traded; provided that “Trading
      Day”
shall
      not include any day on which the Common Stock is scheduled to trade on such
      exchange or market for less than 4.5 hours or any day that the Common Stock
      is
      suspended from trading during the final hour of trading on such exchange or
      market (or if such exchange or market does not designate in advance the closing
      time of trading on such exchange or market, then during the hour ending at
      4:00:00 p.m., New York Time).

     

    (ll) “Voting
      Stock”
of
      a
      Person means capital stock of such Person of the class or classes pursuant
      to
      which the holders thereof have the general voting power to elect, or the general
      power to appoint, at least a majority of the board of directors, managers or
      trustees of such Person (irrespective of whether or not at the time capital
      stock of any other class or classes shall have or might have voting power by
      reason of the happening of any contingency).

     

    (mm) “Warrant”
has
      the
      meaning ascribed to such term in the Securities Purchase Agreement, and shall
      include all warrants issued in exchange therefor or replacement
      thereof.

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

    (nn) “Weighted
      Average Price”
means,
      for any security as of any date, the dollar volume-weighted average price for
      such security on the Principal Market during the period beginning at 9:30:01
      a.m., New York Time (or such other time as the Principal Market publicly
      announces is the official open of trading), and ending at 4:00:00 p.m., New
      York
      Time (or such other time as the Principal Market publicly announces is the
      official close of trading) as reported by Bloomberg through its “Volume
      at Price”
      functions, or, if the foregoing does not apply, the dollar volume-weighted
      average price of such security in the over-the-counter market on the electronic
      bulletin board for such security during the period beginning at 9:30:01 a.m.,
      New York Time (or such other time as such market publicly announces is the
      official open of trading), and ending at 4:00:00 p.m., New York Time (or such
      other time as such market publicly announces is the official close of trading)
      as reported by Bloomberg, or, if no dollar volume-weighted average price is
      reported for such security by Bloomberg for such hours, the average of the
      highest closing bid price and the lowest closing ask price of any of the market
      makers for such security as reported in the “pink
      sheets”
by
      Pink
      Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Weighted
      Average Price cannot be calculated for a security on a particular date on any
      of
      the foregoing bases, the Weighted Average Price of such security on such date
      shall be the fair market value as mutually determined by the Company and the
      Holder. If the Company and the Holder are unable to agree upon the fair market
      value of such security, then such dispute shall be resolved pursuant to
      Section 19. All such determinations to be appropriately adjusted for any
      stock dividend, stock split, stock combination or other similar transaction
      during the applicable calculation period.

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

     

    NATURAL
      NUTRITION, INC.

     

    CONVERSION
      NOTICE

     

    Reference
      is made to the Secured Convertible Note (the “Note”)
      issued
      to the undersigned by Natural Nutrition, Inc. (the “Company”).
      In
      accordance with and pursuant to the Note, the undersigned hereby elects to
      convert the Conversion Amount (as defined in the Note) of the Note indicated
      below into shares of Common Stock par value $0.001 per share (the “Common
      Stock”)
      of the
      Company, as of the date specified below.

     

    Date
      of
      Conversion:   ___________________________________________ 

     

    Aggregate
      Conversion Amount  

    to
      be
      converted:______________________________________________

     

    Please
      confirm the following information:

     

    Conversion
      Price:_____________________________________________

     

    Number
      of
      shares of Common Stock to be

    issued:_____________________________________________________

     

    Please
      issue the Common Stock into which the Note is being converted in the following
      name and to the following address:

     

    Issue
      to:  _____________________________________________

          _____________________________________________  

    
            _____________________________________________  

    

    
            _____________________________________________  

    

     

    Facsimile
      Number:_______________________________________

     

    Authorization: 

     

    By:___________________________________________

                  Name:

              Title:

              Dated:
      ___________________________________

     

    Account
      Number:

    (if
      electronic book entry transfer)___________________________

     

    Transaction
      Code Number:

    (if
      electronic book entry transfer)___________________________

     

    Installment
      Amounts to be reduced and amount of 

    reduction:____________________________________________

     

    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    

    ACKNOWLEDGMENT

     

    The
      Company hereby acknowledges this Conversion Notice and hereby directs
      ______________________ (the “Transfer Agent”) to issue the above indicated
      number of shares of Common Stock in accordance with the Transfer Agent
      Instructions dated _______ __, 200_ from the Company and acknowledged and agreed
      to by the Transfer Agent.

     

    
       

      
        	 	 	 
	 	
                NATURAL
                  NUTRITION, INC.

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                
                  

                

                Name: 

                Title: 

              

      

      
        
          
          

        

      

    

     

    
      
        
        

      

      
        -30-

        
          

        

      

      
        
        

      

    

    EXHIBIT
      C

     

    EBITDA
      THRESHOLDS

     

    
      
        	 	 	 	 	
                 Interactive
                  Nutrition International Inc.

              	 	 	 	 	 
	 	 	 	 	
                 Income
                  Statement (CDN)

              	 	 	 	 	 
	 	 	 	 	
                 Actual
                  and projected

              	 	 	 	 	 
	 	 	 	 	
                 For
                  the years ended 

              	 	 	 	 	 
	 	 	 	 	 	 	 	
                 

              	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	
                Actual
                  

              	 	
                Projected
                  

              	 	
                Projected
                  

              	 	
                Projected
                  

              	 	
                Projected
                  

              	 	
                Projected
                  

              	 
	 	 	
                2006

              	 	
                2007

              	 	
                2008

              	 	
                2009

              	 	
                2010

              	 	
                2011

              	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Revenue

              	 	
                $

              	
                15,324,645

              	 	
                $

              	
                15,324,645

              	 	
                $

              	
                16,857,110

              	 	
                $

              	
                20,228,531

              	 	 	
                24,274,238
                  

              	 	 	
                29,129,085
                  

              	 
	
                Cost
                  of Sales

              	 	 	
                11,226,298
                  

              	 	 	
                11,173,302
                  

              	 	 	
                12,308,132
                  

              	 	 	
                14,769,758
                  

              	 	 	
                17,723,710
                  

              	 	 	
                21,268,452
                  

              	 
	
                Gross
                  Profit

              	 	 	
                4,098,347
                  

              	 	 	
                4,151,343
                  

              	 	 	
                4,548,978
                  

              	 	 	
                5,458,773
                  

              	 	 	
                6,550,528
                  

              	 	 	
                7,860,634
                  

              	 
	
                  
                  (gross margin)

              	 	 	
                26.74

              	
                %

              	 	
                27.09

              	
                %

              	 	
                26.99

              	
                %

              	 	
                26.99

              	
                %

              	 	
                26.99

              	
                %

              	 	
                26.99

              	
                %

              
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Operating
                  expenses

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Selling

              	 	 	
                499,043
                  

              	 	 	
                394,730
                  

              	 	 	
                410,519
                  

              	 	 	
                426,940
                  

              	 	 	
                444,018
                  

              	 	 	
                461,779
                  

              	 
	
                  General
                  and
                  Administrative

              	 	 	
                918,066
                  

              	 	 	
                1,213,743
                  

              	 	 	
                1,321,198
                  

              	 	 	
                1,374,046
                  

              	 	 	
                1,429,008
                  

              	 	 	
                1,486,168
                  

              	 
	
                  Legal
&
                  accounting

              	 	 	
                120,000
                  

              	 	 	
                400,000
                  

              	 	 	
                220,000
                  

              	 	 	
                245,000
                  

              	 	 	
                275,000
                  

              	 	 	
                310,000
                  

              	 
	
                  Amortization

              	 	 	
                253,150
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 
	
                  Interest
                  expense

              	 	 	
                981,011
                  

              	 	 	
                1,029,008
                  

              	 	 	
                1,666,000
                  

              	 	 	
                1,666,000
                  

              	 	 	
                1,666,000
                  

              	 	 	
                1,666,000
                  

              	 
	
                  Contingency

              	 	 	
                -
                  

              	 	 	
                263,636
                  

              	 	 	
                285,197
                  

              	 	 	
                336,315
                  

              	 	 	
                397,435
                  

              	 	 	
                470,528
                  

              	 
	
                Total
                  Expense

              	 	 	
                2,771,270
                  

              	 	 	
                3,551,117
                  

              	 	 	
                4,152,914
                  

              	 	 	
                4,298,301
                  

              	 	 	
                4,461,460
                  

              	 	 	
                4,644,474
                  

              	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Income
                  before unusual item

              	 	 	
                1,327,077
                  

              	 	 	
                600,226
                  

              	 	 	
                396,064
                  

              	 	 	
                1,160,473
                  

              	 	 	
                2,089,068
                  

              	 	 	
                3,216,159
                  

              	 
	
                Trustee
                  in bankruptcy fees

              	 	 	
                141,070
                  

              	 	 	
                50,000
                  

              	 	 	
                -
                  

              	 	 	
                -
                  

              	 	 	
                -
                  

              	 	 	
                -
                  

              	 
	
                Net
                  income before income taxes

              	 	 	
                1,186,007
                  

              	 	 	
                550,226
                  

              	 	 	
                396,064
                  

              	 	 	
                1,160,473
                  

              	 	 	
                2,089,068
                  

              	 	 	
                3,216,159
                  

              	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Income
                  taxes

              	 	 	
                489,496
                  

              	 	 	
                227,078
                  

              	 	 	
                163,455
                  

              	 	 	
                478,927
                  

              	 	 	
                862,158
                  

              	 	 	
                1,327,309
                  

              	 
	
                Net
                  income

              	 	
                $

              	
                696,511

              	 	
                $

              	
                323,148

              	 	
                $

              	
                232,608

              	 	
                $

              	
                681,546

              	 	
                $

              	
                1,226,910

              	 	
                $

              	
                1,888,850

              	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                EBITDA

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Amortization

              	 	 	
                253,150
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 	 	
                250,000
                  

              	 
	
                  Interest
                  expense

              	 	 	
                981,011
                  

              	 	 	
                1,029,008
                  

              	 	 	
                1,666,000
                  

              	 	 	
                1,666,000
                  

              	 	 	
                1,666,000
                  

              	 	 	
                1,666,000
                  

              	 
	
                  Corporate
                  Taxes

              	 	 	
                489,496
                  

              	 	 	
                227,078
                  

              	 	 	
                163,455
                  

              	 	 	
                478,927
                  

              	 	 	
                862,158
                  

              	 	 	
                1,327,309
                  

              	 
	
                  EBITDA*

              	 	
                $

              	
                2,420,168

              	 	
                $

              	
                1,829,234

              	 	
                $

              	
                2,312,064

              	 	
                $

              	
                3,076,473

              	 	
                $

              	
                4,005,068

              	 	
                $

              	
                5,132,159

              	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Assumed
                  sale at 8 times EBITDA

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
                $

              	
                41,057,274

              	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                *
                  Annual EBITDA targets are shown; quarterly EBITDA targets shall
                  be
                  3/12ths, 6/12ths and 9/12th of the annual targets for each of the
                  first
                  three quarterly periods of each year.

              
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Adjustments
                  to P&L beginning in July 2007: 

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Cost
                  of sales
                  

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Joe
                  Nesrallah elimination 

              	 	 	 	 	 	
                (89,996

              	
                )

              	 	
                (179,993

              	
                )

              	 	
                (359,986

              	
                )

              	 	 	 	 	 	 
	
                    Trevo Holroyd
                  salary increase
                  

              	 	 	 	 	 	
                12,000
                  

              	 	 	
                24,000
                  

              	 	 	
                24,001
                  

              	 	 	 	 	 	 	 
	
                  Total
                  adjustments
                  

              	 	 	 	 	 	
                (77,996

              	
                )

              	 	
                (155,993

              	
                )

              	 	
                (335,985

              	
                )

              	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Selling
                  expenses
                  

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Eli
                  Nesrallah elimination 

              	 	 	 	 	 	
                (179,993

              	
                )

              	 	
                (359,986

              	
                )

              	 	
                (359,986

              	
                )

              	 	 	 	 	 	 
	
                    New
                  sales position 

              	 	 	 	 	 	
                -
                  

              	 	 	
                150,000
                  

              	 	 	
                150,000
                  

              	 	 	 	 	 	 	 
	
                    Increased
                  marketing budget 

              	 	 	 	 	 	
                73,680
                  

              	 	 	
                147,360
                  

              	 	 	
                147,360
                  

              	 	 	 	 	 	 	 
	
                  Total
                  adjustments
                  

              	 	 	 	 	 	
                (106,313

              	
                )

              	 	
                (62,626

              	
                )

              	 	
                (62,626

              	
                )

              	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  G&A
                  expenses
                  

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                    Pam
                  Nesrallah elimination 

              	 	 	 	 	 	
                (119,995

              	
                )

              	 	
                (239,990

              	
                )

              	 	
                (239,990

              	
                )

              	 	 	 	 	 	 
	
                    Rachel
                  (current controller elimination) 

              	 	 	 	 	 	
                (32,994

              	
                )

              	 	
                (65,988

              	
                )

              	 	
                (65,988

              	
                )

              	 	 	 	 	 	 
	
                    New
                  controller 

              	 	 	 	 	 	
                48,000
                  

              	 	 	
                96,000
                  

              	 	 	
                96,000
                  

              	 	 	 	 	 	 	 
	
                    Severance
                  to
                  controller 

              	 	 	 	 	 	
                16,667
                  

              	 	 	
                8,333
                  

              	 	 	
                -
                  

              	 	 	 	 	 	 	 
	
                    New
                  CEO
                  

              	 	 	 	 	 	
                144,000
                  

              	 	 	
                288,000
                  

              	 	 	
                288,000
                  

              	 	 	 	 	 	 	 
	
                    TAP
                  fee
                  

              	 	 	 	 	 	
                120,000
                  

              	 	 	
                240,000
                  

              	 	 	
                240,000
                  

              	 	 	 	 	 	 	 
	
                    Systems
                  licensing (June) 

              	 	 	 	 	 	
                5,000
                  

              	 	 	
                5,000
                  

              	 	 	
                5,000
                  

              	 	 	 	 	 	 	 
	
                    Systems
                  upgrades (August) 

              	 	 	 	 	 	
                7,500
                  

              	 	 	
                50,000
                  

              	 	 	
                25,000
                  

              	 	 	 	 	 	 	 
	
                    IP
                  valuation (May) 

              	 	 	 	 	 	
                25,000
                  

              	 	 	
                -
                  

              	 	 	
                -
                  

              	 	 	 	 	 	 	 
	
                    Transaction
                  fees - closing & foreclosure (May - Aug) 

              	 	 	 	 	 	
                200,000
                  

              	 	 	
                -
                  

              	 	 	
                -
                  

              	 	 	 	 	 	 	 
	
                    Travel
                  expenses 

              	 	 	 	 	 	
                80,000
                  

              	 	 	
                80,000
                  

              	 	 	
                80,000
                  

              	 	 	 	 	 	 	 
	
                    Public
                  company accounting fees (Qtrly) 

              	 	 	 	 	 	
                80,000
                  

              	 	 	
                100,000
                  

              	 	 	
                125,000
                  

              	 	 	 	 	 	 	 
	
                  Total
                  adjustments
                  

              	 	 	 	 	 	
                573,177
                  

              	 	 	
                561,355
                  

              	 	 	
                553,022
                  

              	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                Bonus
                  pool: 

              	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Production
                  

              	 	 	 	 	 	
                25,000
                  

              	 	 	
                17,500
                  

              	 	 	 	 	 	 	 	 	 	 
	
                  Selling
                  

              	 	 	 	 	 	
                2,000
                  

              	 	 	
                2,000
                  

              	 	 	 	 	 	 	 	 	 	 
	
                  G&A
                  

              	 	 	 	 	 	
                2,500
                  

              	 	 	
                2,500
                  

              	 	 	 	 	 	 	 	 	 	 

      

      
        
          
          

        

        
          -31-

          
            

          

        

        
          
          

        

      

       

      
        
          	 	 	 	 	 	 	 	 	 	 	
                  INII

                	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	
                   Cash
                    flow projections

                	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	
                  2007

                	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	
                  Jan.
                    2007

                	 	
                  Feb.
                    2007 

                	 	
                  Mar.
                    2007 

                	 	
                  Apr.
                    2007

                	 	
                  May.
                    2007

                	 	
                  June.
                    2007

                	 	
                  July.
                    2007

                	 	
                  Aug.
                    2007 

                	 	
                  Sept.
                    2007 

                	 	
                  Oct.
                    2007

                	 	
                  Nov.
                    2007 

                	 	
                  Dec.
                    2007

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Cash
                    at beginning of period

                	 	 	
                  408,837
                    

                	 	 	
                  790,268
                    

                	 	 	
                  350,609
                    

                	 	 	
                  480,551
                    

                	 	 	
                  209,636
                    

                	 	 	
                  1,446,114
                    

                	 	 	
                  1,152,576
                    

                	 	 	
                  1,410,359
                    

                	 	 	
                  1,353,325
                    

                	 	 	
                  1,435,420
                    

                	 	 	
                  1,630,106
                    

                	 	 	
                  2,133,791
                    

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Net
                    Profit for Month

                	 	 	
                  47,674
                    

                	 	 	
                  66,176
                    

                	 	 	
                  176,670
                    

                	 	 	
                  (35,268

                	
                  )

                	 	
                  74,351
                    

                	 	 	
                  (54,226

                	
                  )

                	 	
                  (23,261

                	
                  )

                	 	
                  (51,226

                	
                  )

                	 	
                  88,626
                    

                	 	 	
                  259,709
                    

                	 	 	
                  281,451
                    

                	 	 	
                  (507,528

                	
                  )

                
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Prepaid
                    Expenses Disbursed

                	 	 	
                  (58,782

                	
                  )

                	 	
                  (2,975

                	
                  )

                	 	
                  3,533
                    

                	 	 	
                  (2,172

                	
                  )

                	 	
                  1,086
                    

                	 	 	
                  (541

                	
                  )

                	 	
                  184
                    

                	 	 	
                  290
                    

                	 	 	
                  (233

                	
                  )

                	 	
                  (2,088

                	
                  )

                	 	
                  3,489
                    

                	 	 	
                  (654

                	
                  )

                
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  (Investment)-Reduction
                    in Inventory

                	 	 	
                  (54,900

                	
                  )

                	 	
                  (174,500

                	
                  )

                	 	
                  292,300
                    

                	 	 	
                  (242,540

                	
                  )

                	 	
                  101,450
                    

                	 	 	
                  (70,290

                	
                  )

                	 	
                  12,870
                    

                	 	 	
                  (16,890

                	
                  )

                	 	
                  (63,950

                	
                  )

                	 	
                  (32,500

                	
                  )

                	 	
                  318,150
                    

                	 	 	
                  (230,100

                	
                  )

                
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  (Investment)-Reduction
                    in AR

                	 	 	
                  305,596
                    

                	 	 	
                  (470,000

                	
                  )

                	 	
                  (380,000

                	
                  )

                	 	
                  270,000
                    

                	 	 	
                  139,000
                    

                	 	 	
                  (217,000

                	
                  )

                	 	
                  106,000
                    

                	 	 	
                  (60,000

                	
                  )

                	 	
                  40,000
                    

                	 	 	
                  (103,000

                	
                  )

                	 	
                  (130,000

                	
                  )

                	 	
                  580,000
                    

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Use
                    of Trade Credit (AP) and Other Liab.

                	 	 	
                  53,346
                    

                	 	 	
                  63,163
                    

                	 	 	
                  188,981
                    

                	 	 	
                  (357,872

                	
                  )

                	 	
                  247,674
                    

                	 	 	
                  (123,377

                	
                  )

                	 	
                  64,614
                    

                	 	 	
                  (26,563

                	
                  )

                	 	
                  3,069
                    

                	 	 	
                  58,003
                    

                	 	 	
                  16,050
                    

                	 	 	
                  (361,046

                	
                  )

                
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Payment
                    to Securied Creditor

                	 	 	 	 	 	 	 	 	
                  (250,000

                	
                  )

                	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Capital
                    Leases

                	 	 	
                  (2,984

                	
                  )

                	 	
                  (3,004

                	
                  )

                	 	
                  (3,023

                	
                  )

                	 	
                  (3,044

                	
                  )

                	 	
                  (3,064

                	
                  )

                	 	
                  71,915
                    

                	 	 	
                  (4,105

                	
                  )

                	 	
                  (4,126

                	
                  )

                	 	
                  (4,147

                	
                  )

                	 	
                  (4,168

                	
                  )

                	 	
                  (4,189

                	
                  )

                	 	
                  (4,211

                	
                  )

                
	
                  Working
                    capital proceeds from Cornell

                	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
                  600,000
                    

                	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Noncash
                    interest accrual for taxes

                	 	 	
                  81,751
                    

                	 	 	
                  81,751
                    

                	 	 	
                  81,751
                    

                	 	 	
                  81,751
                    

                	 	 	
                  81,751
                    

                	 	 	
                  81,751
                    

                	 	 	
                  81,751
                    

                	 	 	
                  81,751
                    

                	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Capital
                    Purchases

                	 	 	
                  (11,103

                	
                  )

                	 	
                  (21,103

                	
                  )

                	 	
                  (1,103

                	
                  )

                	 	
                  (2,603

                	
                  )

                	 	
                  (26,603

                	
                  )

                	 	
                  (2,603

                	
                  )

                	 	
                  (1,103

                	
                  )

                	 	
                  (1,103

                	
                  )

                	 	
                  (2,103

                	
                  )

                	 	
                  (2,103

                	
                  )

                	 	
                  (2,103

                	
                  )

                	 	
                  (1,103

                	
                  )

                
	
                  Amortization

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,833
                    

                	 	 	
                  20,837
                    

                	 	 	
                  20,833
                    

                	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
                  Cash
                    at end of period

                	 	 	
                  790,268
                    

                	 	 	
                  350,609
                    

                	 	 	
                  480,551
                    

                	 	 	
                  209,636
                    

                	 	 	
                  1,446,114
                    

                	 	 	
                  1,152,576
                    

                	 	 	
                  1,410,359
                    

                	 	 	
                  1,353,325
                    

                	 	 	
                  1,435,420
                    

                	 	 	
                  1,630,106
                    

                	 	 	
                  2,133,791
                    

                	 	 	
                  1,629,982
                    

                	 

        

      

       

      
        
          
          

        

        
          -32-NEITHER
      THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
      THE
      SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
      LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
      (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE
      SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION
      OF COUNSEL, IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION
      IS
      NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144
      OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES
      MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
      OR
      FINANCING ARRANGEMENT SECURED BY THE SECURITIES. ANY TRANSFEREE OF THIS WARRANT
      SHOULD CAREFULLY REVIEW THE TERMS OF THIS WARRANT.

     

    NATURAL
      NUTRITION, INC.

     

    WARRANT
      TO PURCHASE COMMON STOCK

     

    Warrant
      No.:

    Number
      of
      Shares of Common Stock: 61,952,626

    Date
      of
      Issuance: May 312007 (“Issuance
      Date”)

     

    Natural
      Nutrition, Inc., a Nevada corporation (the “Company”),
      hereby certifies that, for good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, CORNELL CAPITAL PARTNERS, LP,
      the
      registered holder hereof or its permitted assigns (the “Holder”),
      is
      entitled, subject to the terms set forth below, to purchase from the Company,
      at
      the Exercise Price (as defined below) then in effect, upon surrender of this
      Warrant to Purchase Common Stock (including any Warrants to Purchase Common
      Stock issued in exchange, transfer or replacement hereof, the “Warrant”),
      at
      any time or times on or after the date hereof, but not after 11:59 p.m., New
      York time, on the Expiration Date (as defined below), SIXTY ONE MILLION NINE
      HUNDRED FIFTY TWO THOUSAND SIX HUNDRED TWENTY SIX (61,952,626) fully paid
      nonassessable shares of Common Stock (as defined below) (the “Warrant
      Shares”).
      Except as otherwise defined herein, capitalized terms in this Warrant shall
      have
      the meanings set forth in Section 15 hereto. This Warrant is issued
      pursuant to that certain Securities Purchase Agreement, dated as of the Issuance
      Date (the “Subscription
      Date”),
      by
      and between the Company and the Holder (the “Buyer”)
      (the
“Securities
      Purchase Agreement”).

     

    1.  EXERCISE
      OF WARRANT.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (a)  Mechanics
      of Exercise.
      Subject
      to the terms and conditions hereof (including, without limitation, the
      limitations set forth in Section 1(f)), this Warrant may be exercised by
      the Holder on any day on or after the date hereof, in whole or in part, by
      (i) delivery of a written notice, in the form attached hereto as
Exhibit A
      (the
“Exercise
      Notice”),
      of
      the Holder’s election to exercise this Warrant (accompanied by the attached
      Warrant Shares Exercise Log) to the Company and (ii) (A) payment to
      the Company of an amount equal to the applicable Exercise Price multiplied
      by
      the number of Warrant Shares as to which this Warrant is being exercised (the
      “Aggregate
      Exercise Price”)
      in
      cash or by wire transfer of immediately available funds or (B) by notifying
      the Company that this Warrant is being exercised pursuant to a Cashless Exercise
      (as defined in Section 1(d)). The Holder shall not be required to deliver
      the original Warrant in order to effect an exercise hereunder. Execution and
      delivery of the Exercise Notice with respect to less than all of the Warrant
      Shares shall have the same effect as cancellation of the original Warrant and
      issuance of a new Warrant evidencing the right to purchase the remaining number
      of Warrant Shares. On or before the second (2nd)
      Business Day following the date on which the Company has received each of the
      Exercise Notice and the Aggregate Exercise Price (or notice of a Cashless
      Exercise) (the “Exercise
      Delivery Documents”),
      the
      Company shall transmit by facsimile an acknowledgment of confirmation of receipt
      of the Exercise Delivery Documents to the Holder and the Company’s transfer
      agent (the “Transfer
      Agent”).
      For
      purposes hereof, any Exercise Delivery Documents delivered on or after 5:00
      p.m., New York City time shall be deemed to have been delivered on the next
      Business Day. On or before the fifth (5th)
      Business Day following the date on which the Company has received all of the
      Exercise Delivery Documents (the “Share
      Delivery Date”),
      the
      Company shall (X) if legends are not required to be placed on certificates
      of Common Stock pursuant to the Securities Purchase Agreement and provided
      that
      the Transfer Agent is participating in The Depository Trust Company
      (“DTC”)
      Fast
      Automated Securities Transfer Program, upon the request of the Holder, credit
      such aggregate number of Warrant Shares to which the Holder is entitled pursuant
      to such exercise to the Holder’s or its designee’s balance account with DTC
      through its Deposit Withdrawal Agent Commission system, or (Y) if the
      Transfer Agent is not participating in the DTC Fast Automated Securities
      Transfer Program, issue and dispatch by overnight courier to the address as
      specified in the Exercise Notice, a certificate, registered in the Company’s
      share register in the name of the Holder or its designee, for the number of
      shares of Common Stock to which the Holder is entitled pursuant to such exercise
      which certificates shall not bear any restrictive legends unless required
      pursuant to the Securities Purchase Agreement. Upon delivery of the Exercise
      Delivery Documents, the Holder shall be deemed for all corporate purposes to
      have become the holder of record of the Warrant Shares with respect to which
      this Warrant has been exercised, irrespective of the date such Warrant Shares
      are credited to the Holder’s DTC account or the date of delivery of the
      certificates evidencing such Warrant Shares as the case may be. If this Warrant
      is submitted in connection with any exercise pursuant to this Section 1(a)
      and the number of Warrant Shares represented by this Warrant submitted for
      exercise is greater than the number of Warrant Shares being acquired upon an
      exercise, then the Company shall as soon as practicable and in no event later
      than five (5) Business Days after any exercise and at its own expense, issue
      subject to such prior exercise a new Warrant (in accordance with Section 7)
      representing the right to purchase the number of Warrant Shares purchasable
      immediately prior to such exercise under this Warrant, less the number of
      Warrant Shares with respect to which this Warrant is exercised. No fractional
      shares of Common Stock are to be issued upon the exercise of this Warrant,
      but
      rather the number of shares of Common Stock to be issued shall be rounded up
      to
      the nearest whole number. The Company shall pay any and all taxes which may
      be
      payable with respect to the issuance and delivery of Warrant Shares upon
      exercise of this Warrant.

     

    (b)  Exercise
      Price.
      For
      purposes of this Warrant, “Exercise
      Price”
means
      $0.01, subject to adjustment as provided herein.

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

    (c)  Company’s
      Failure to Timely Deliver Securities.
      If
      within three (3) Trading Days after the Company’s receipt of the facsimile copy
      of a Exercise Notice the Company shall fail to issue and deliver a certificate
      to the Holder and register such shares of Common Stock on the Company’s share
      register or credit the Holder’s balance account with DTC for the number of
      shares of Common Stock to which the Holder is entitled upon the Holder’s
      exercise hereunder, and if on or after such Trading Day the Holder purchases
      (in
      an open market transaction or otherwise) shares of Common Stock to deliver
      in
      satisfaction of a sale by the Holder of shares of Common Stock issuable upon
      such exercise that the Holder anticipated receiving from the Company (a
“Buy-In”),
      then
      the Company shall, within three (3) Trading Days after the Holder’s request and
      in the Holder’s discretion, either (i) pay cash to the Holder in an amount
      equal to the Holder’s total purchase price (including brokerage commissions, if
      any) for the shares of Common Stock so purchased (the “Buy-In
      Price”),
      at
      which point the Company’s obligation to deliver such certificate (and to issue
      such Warrant Shares) shall terminate, or (ii) promptly honor its obligation
      to deliver to the Holder a certificate or certificates or if legends are not
      required to be placed on certificates of Common Stock pursuant to the Securities
      Purchase Agreement, provided that the Transfer Agent is participating in DTC
      Fast Automated Securities Transfer Program, upon the request of the Holder,
      credit such aggregate number of Warrant Shares to which the Holder is entitled
      pursuant to such exercise to the Holder’s or its designee’s balance account with
      DTC through its Deposit Withdrawal Agent Commission system and pay cash to
      the
      Holder in an amount equal to the excess (if any) of the Buy-In Price over the
      product of (A) such number of shares of Common Stock, times (B) the
      Closing Bid Price on the date of exercise.

     

    (d)  Cashless
      Exercise.
      So long
      as the Company is in default under any of the Transaction Documents or the
      Warrant Shares are not subject to an effective Registration Statement (as such
      term is defined in the Registration Rights Agreement of even date herewith)
      and
      notwithstanding anything contained herein to the contrary, the Holder may,
      in
      its sole discretion during such time, exercise this Warrant in whole or in
      part
      and, in lieu of making the cash payment otherwise contemplated to be made to
      the
      Company upon such exercise in payment of the Aggregate Exercise Price, elect
      instead to receive upon such exercise the “Net
      Number”
of
      shares of Common Stock determined according to the following formula (a
“Cashless
      Exercise”):

     

    

     

    For
      purposes of the foregoing formula:

     

    A=
      the
      total number of shares with respect to which this Warrant is then being
      exercised.

     

    B=
      the
      Closing Sale Price of the shares of Common Stock (as reported by Bloomberg)
      on
      the date immediately preceding the date of the Exercise Notice.

     

    C=
      the
      Exercise Price then in effect for the applicable Warrant Shares at the time
      of
      such exercise.

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    (e)  Disputes.
      In the
      case of a dispute as to the determination of the Exercise Price or the
      arithmetic calculation of the Warrant Shares, the Company shall promptly issue
      to the Holder the number of Warrant Shares that are not disputed and resolve
      such dispute in accordance with Section 12.

     

    (f)  Limitations
      on Exercises.
      The
      Company shall not effect the exercise of this Warrant, and the Holder shall
      not
      have the right to exercise this Warrant, to the extent that after giving effect
      to such exercise, such Person (together with such Person’s affiliates) would
      beneficially own in excess of 4.99% of the shares of Common Stock outstanding
      immediately after giving effect to such exercise. For purposes of the foregoing
      sentence, the aggregate number of shares of Common Stock beneficially owned
      by
      such Person and its affiliates shall include the number of shares of Common
      Stock issuable upon exercise of this Warrant with respect to which the
      determination of such sentence is being made, but shall exclude shares of Common
      Stock which would be issuable upon (i) exercise of the remaining,
      unexercised portion of this Warrant beneficially owned by such Person and its
      affiliates and (ii) exercise or conversion of the unexercised or
      unconverted portion of any other securities of the Company beneficially owned
      by
      such Person and its affiliates (including, without limitation, any convertible
      notes or convertible preferred stock or warrants) subject to a limitation on
      conversion or exercise analogous to the limitation contained herein. Except
      as
      set forth in the preceding sentence, for purposes of this paragraph, beneficial
      ownership shall be calculated in accordance with Section 13(d) of the
      Securities Exchange Act of 1934, as amended. For purposes of this Warrant,
      in
      determining the number of outstanding shares of Common Stock, the Holder may
      rely on the number of outstanding shares of Common Stock as reflected in
      (1) the Company’s most recent report on Form 10-KSB, Form 10-QSB,
      Current Report on Form 8-K or other public filing with the U.S. Securities
      and Exchange Commission, as the case may be, (2) a more recent public
      announcement by the Company or (3) any other notice by the Company or the
      Transfer Agent setting forth the number of shares of Common Stock outstanding.
      For any reason at any time, upon the written request of the Holder, the Company
      shall within one (1) Business Day confirm in writing to the Holder the number
      of
      shares of Common Stock then outstanding. In any case, the number of outstanding
      shares of Common Stock shall be determined after giving effect to the conversion
      or exercise of securities of the Company by the Holder and its affiliates since
      the date as of which such number of outstanding shares of Common Stock was
      reported.

     

    (g)  Insufficient
      Authorized Shares.
      If at
      any time while the Warrant remains outstanding the Company does not have a
      sufficient number of authorized and unreserved shares of Common Stock to satisfy
      its obligation to reserve for issuance upon exercise of the Warrant at least
      a
      number of shares of Common Stock equal to 130% of the number of shares of Common
      Stock as shall from time to time be necessary to effect the exercise of the
      Warrant in full (the “Required
      Reserve Amount”)
      (an
“Authorized
      Share Failure”),
      then
      the Company shall immediately take all action necessary to increase the
      Company’s authorized shares of Common Stock to an amount sufficient to allow the
      Company to reserve the Required Reserve Amount for the Warrant. Without limiting
      the generality of the foregoing sentence, as soon as practicable after the
      date
      of the occurrence of an Authorized Share Failure, but in no event later than
      ninety (90) days after the occurrence of such Authorized Share Failure, the
      Company shall hold a meeting of its stockholders for the approval of an increase
      in the number of authorized shares of Common Stock. In connection with such
      meeting, the Company shall provide each stockholder with a proxy statement
      and
      shall use its best efforts to solicit its stockholders’ approval of such
      increase in authorized shares of Common Stock and to cause its Board of
      Directors (the “Board”)
      to
      recommend to the stockholders that they approve such proposal.

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

    2.  ADJUSTMENT
      OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES.
      The
      Exercise Price and the number of Warrant Shares shall be adjusted from time
      to
      time as follows:

     

    (a)  Adjustment
      upon Issuance of shares of Common Stock.
      If and
      whenever on or after the Subscription Date the Company issues or sells, or
      in
      accordance with this Section 2 is deemed to have issued or sold, any shares
      of Common Stock (including the issuance or sale of shares of Common Stock owned
      or held by or for the account of the Company, but excluding shares of Common
      Stock deemed to have been issued by the Company in connection with any Excluded
      Securities (as defined in the Note) for a consideration per share (the
“New
      Issuance Price”)
      less
      than a price equal to the Exercise Price in effect immediately prior to such
      issue or sale or deemed issuance or sale (the “Applicable
      Price”
and
      the
      foregoing a “Dilutive
      Issuance”),
      then
      immediately after such Dilutive Issuance, the Exercise Price then in effect
      shall be reduced to an amount equal to the New Issuance Price. Upon each such
      adjustment of the Exercise Price hereunder, the number of Warrant Shares shall
      be adjusted to the number of shares of Common Stock determined by multiplying
      the Exercise Price in effect immediately prior to such adjustment by the number
      of Warrant Shares acquirable upon exercise of this Warrant immediately prior
      to
      such adjustment and dividing the product thereof by the Exercise Price resulting
      from such adjustment. For purposes of determining the adjusted Exercise Price
      under this Section 2(a), the following shall be applicable:

     

    (i)  Issuance
      of Options.
      If the
      Company in any manner grants any Options and the lowest price per share for
      which one share of Common Stock is issuable upon the exercise of any such Option
      or upon conversion, exercise or exchange of any Convertible Securities issuable
      upon exercise of any such Option is less than the Applicable Price, then such
      share of Common Stock shall be deemed to be outstanding and to have been issued
      and sold by the Company at the time of the granting or sale of such Option
      for
      such price per share. For purposes of this Section 2(a)(i), the “lowest
      price per share for which one share of Common Stock is issuable upon exercise
      of
      any such Options or upon conversion, exercise or exchange of any Convertible
      Securities issuable upon exercise of such Option” shall be equal to the sum of
      the lowest amounts of consideration (if any) received or receivable by the
      Company with respect to any one share of Common Stock upon the granting or
      sale
      of the Option, upon exercise of the Option and upon conversion, exercise or
      exchange of any Convertible Security issuable upon exercise of such Option.
      No
      further adjustment of the Exercise Price or number of Warrant Shares shall
      be
      made upon the actual issuance of such shares of Common Stock or of such
      Convertible Securities upon the exercise of such Options or upon the actual
      issuance of such shares of Common Stock upon conversion, exercise or exchange
      of
      such Convertible Securities.

     

    (ii)  Issuance
      of Convertible Securities.
      If the
      Company in any manner issues or sells any Convertible Securities and the lowest
      price per share for which one (1) share of Common Stock is issuable upon the
      conversion, exercise or exchange thereof is less than the Applicable Price,
      then
      such share of Common Stock shall be deemed to be outstanding and to have been
      issued and sold by the Company at the time of the issuance or sale of such
      Convertible Securities for such price per share. For the purposes of this
      Section 2(a)(ii), the “lowest price per share for which one share of Common
      Stock is issuable upon the conversion, exercise or exchange” shall be equal to
      the sum of the lowest amounts of consideration (if any) received or receivable
      by the Company with respect to one share of Common Stock upon the issuance
      or
      sale of the Convertible Security and upon conversion, exercise or exchange
      of
      such Convertible Security. No further adjustment of the Exercise Price or number
      of Warrant Shares shall be made upon the actual issuance of such shares of
      Common Stock upon conversion, exercise or exchange of such Convertible
      Securities, and if any such issue or sale of such Convertible Securities is
      made
      upon exercise of any Options for which adjustment of this Warrant has been
      or is
      to be made pursuant to other provisions of this Section 2(a), no further
      adjustment of the Exercise Price or number of Warrant Shares shall be made
      by
      reason of such issue or sale.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

    (iii)  Change
      in Option Price or Rate of Conversion.
      If the
      purchase price provided for in any Options, the additional consideration, if
      any, payable upon the issue, conversion, exercise or exchange of any Convertible
      Securities, or the rate at which any Convertible Securities are convertible
      into
      or exercisable or exchangeable for shares of Common Stock increases or decreases
      at any time, the Exercise Price and the number of Warrant Shares in effect
      at
      the time of such increase or decrease shall be adjusted to the Exercise Price
      and the number of Warrant Shares which would have been in effect at such time
      had such Options or Convertible Securities provided for such increased or
      decreased purchase price, additional consideration or increased or decreased
      conversion rate, as the case may be, at the time initially granted, issued
      or
      sold. For purposes of this Section 2(a)(iii), if the terms of any Option or
      Convertible Security that was outstanding as of the date of issuance of this
      Warrant are increased or decreased in the manner described in the immediately
      preceding sentence, then such Option or Convertible Security and the shares
      of
      Common Stock deemed issuable upon exercise, conversion or exchange thereof
      shall
      be deemed to have been issued as of the date of such increase or decrease.
      No
      adjustment pursuant to this Section 2(a) shall be made if such adjustment
      would result in an increase of the Exercise Price then in effect or a decrease
      in the number of Warrant Shares.

     

    (iv)  Calculation
      of Consideration Received.
      In case
      any Option is issued in connection with the issue or sale of other securities
      of
      the Company, together comprising one integrated transaction in which no specific
      consideration is allocated to such Options by the parties thereto, the Options
      will be deemed to have been issued the difference of (x) the aggregate fair
      market value of such Options and other securities issued or sold in such
      integrated transaction, less (y) the fair market value of the securities
      other than such Option, issued or sold in such transaction and the other
      securities issued or sold in such integrated transaction will be deemed to
      have
      been issued or sold for the balance of the consideration received by the
      Company. If any Common Stock, Options or Convertible Securities are issued
      or
      sold or deemed to have been issued or sold for cash, the consideration received
      therefor will be deemed to be the gross amount raised by the Company; provided,
      however, that such gross amount is not greater than 110% of the net amount
      received by the Company therefor. If any shares of Common Stock, Options or
      Convertible Securities are issued or sold for a consideration other than cash,
      the amount of such consideration received by the Company will be the fair value
      of such consideration, except where such consideration consists of securities,
      in which case the amount of consideration received by the Company will be the
      Closing Sale Price of such security on the date of receipt. If any shares of
      Common Stock, Options or Convertible Securities are issued to the owners of
      the
      non-surviving entity in connection with any merger in which the Company is
      the
      surviving entity, the amount of consideration therefor will be deemed to be
      the
      fair value of such portion of the net assets and business of the non-surviving
      entity as is attributable to such shares of Common Stock, Options or Convertible
      Securities, as the case may be. The fair value of any consideration other than
      cash or securities will be determined jointly by the Company and the Holder.
      If
      such parties are unable to reach agreement within ten (10) calendar days after
      the occurrence of an event requiring valuation (the “Valuation
      Event”),
      the
      fair value of such consideration will be determined within five (5) Business
      Days after the tenth day following the Valuation Event by an independent,
      reputable appraiser jointly selected by the Company and the Holder. The
      determination of such appraiser shall be final and binding upon all parties
      absent manifest error and the fees and expenses of such appraiser shall be
      borne
      by the Company.

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    (v)  Record
      Date.
      If the
      Company takes a record of the holders of shares of Common Stock for the purpose
      of entitling them (A) to receive a dividend or other distribution payable
      in shares of Common Stock, Options or in Convertible Securities or (B) to
      subscribe for or purchase shares of Common Stock, Options or Convertible
      Securities, then such record date will be deemed to be the date of the issue
      or
      sale of the shares of Common Stock deemed to have been issued or sold upon
      the
      declaration of such dividend or the making of such other distribution or the
      date of the granting of such right of subscription or purchase, as the case
      may
      be.

     

    (b)  Adjustment
      upon Subdivision or Combination of Common Stock.
      If the
      Company at any time on or after the Subscription Date subdivides (by any stock
      split, stock dividend, recapitalization or otherwise) one (1) or more classes
      of
      its outstanding shares of Common Stock into a greater number of shares, the
      Exercise Price in effect immediately prior to such subdivision will be
      proportionately reduced and the number of Warrant Shares will be proportionately
      increased. If the Company at any time on or after the Subscription Date combines
      (by combination, reverse stock split or otherwise) one (1) or more classes
      of
      its outstanding shares of Common Stock into a smaller number of shares, the
      Exercise Price in effect immediately prior to such combination will be
      proportionately increased and the number of Warrant Shares will be
      proportionately decreased. Any adjustment under this Section 2(b) shall
      become effective at the close of business on the date the subdivision or
      combination becomes effective.

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

    (c)  Other
      Events.
      If any
      event occurs of the type contemplated by the provisions of this Section 2
      but not expressly provided for by such provisions (including, without
      limitation, the granting of stock appreciation rights, phantom stock rights
      or
      other rights with equity features), then the Board will make an appropriate
      adjustment in the Exercise Price and the number of Warrant Shares so as to
      protect the rights of the Holder; provided that no such adjustment pursuant
      to
      this Section 2(c) will increase the Exercise Price or decrease the number
      of Warrant Shares as otherwise determined pursuant to this
      Section 2.

     

    3.  RIGHTS
      UPON DISTRIBUTION OF ASSETS.
      If the
      Company shall declare or make any dividend or other distribution of its assets
      (or rights to acquire its assets) to holders of shares of Common Stock, by
      way
      of return of capital or otherwise (including, without limitation, any
      distribution of cash, stock or other securities, property or options by way
      of a
      dividend, spin off, reclassification, corporate rearrangement, scheme of
      arrangement or other similar transaction) (a “Distribution”),
      at
      any time after the issuance of this Warrant, then, in each such
      case:

     

    (a) any
      Exercise Price in effect immediately prior to the close of business on the
      record date fixed for the determination of holders of shares of Common Stock
      entitled to receive the Distribution shall be reduced, effective as of the
      close
      of business on such record date, to a price determined by multiplying such
      Exercise Price by a fraction of which (i) the numerator shall be the
      Closing Bid Price of the shares of Common Stock on the trading day immediately
      preceding such record date minus the value of the Distribution (as determined
      in
      good faith by the Board) applicable to one share of shares of Common Stock,
      and
      (ii) the denominator shall be the Closing Bid Price of the shares of Common
      Stock on the trading day immediately preceding such record date;
      and

     

    (b) the
      number of Warrant Shares shall be increased to a number of shares equal to
      the
      number of shares of Common Stock obtainable immediately prior to the close
      of
      business on the record date fixed for the determination of holders of shares
      of
      Common Stock entitled to receive the Distribution multiplied by the reciprocal
      of the fraction set forth in the immediately preceding paragraph (a);
      provided that in the event that the Distribution is of shares of Common Stock
      (or common stock) (“Other
      Shares of Common Stock”)
      of a
      company whose common shares are traded on a national securities exchange or
      a
      national automated quotation system, then the Holder may elect to receive a
      warrant to purchase Other Shares of Common Stock in lieu of an increase in
      the
      number of Warrant Shares, the terms of which shall be identical to those of
      this
      Warrant, except that such warrant shall be exercisable into the number of shares
      of Other Shares of Common Stock that would have been payable to the Holder
      pursuant to the Distribution had the Holder exercised this Warrant immediately
      prior to such record date and with an aggregate exercise price equal to the
      product of the amount by which the exercise price of this Warrant was decreased
      with respect to the Distribution pursuant to the terms of the immediately
      preceding paragraph (a) and the number of Warrant Shares calculated in
      accordance with the first part of this paragraph (b).

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

    4.  PURCHASE
      RIGHTS; FUNDAMENTAL TRANSACTIONS.

     

    (a)  Purchase
      Rights.
      In
      addition to any adjustments pursuant to Section 2 above, if at any time the
      Company grants, issues or sells any Options, Convertible Securities or rights
      to
      purchase stock, warrants, securities or other property pro rata to the record
      holders of any class of shares of Common Stock (the “Purchase
      Rights”),
      then
      the Holder will be entitled to acquire, upon the terms applicable to such
      Purchase Rights, the aggregate Purchase Rights which the Holder could have
      acquired if the Holder had held the number of shares of Common Stock acquirable
      upon complete exercise of this Warrant (without regard to any limitations on
      the
      exercise of this Warrant) immediately before the date on which a record is
      taken
      for the grant, issuance or sale of such Purchase Rights, or, if no such record
      is taken, the date as of which the record holders of shares of Common Stock
      are
      to be determined for the grant, issue or sale of such Purchase
      Rights.

     

    (b)  Fundamental
      Transactions.
      The
      Company shall not enter into or be party to a Fundamental Transaction unless
      (i) the Successor Entity assumes in writing all of the obligations of the
      Company under this Warrant and the other Transaction Documents in accordance
      with the provisions of this Section (4)(b) pursuant to written agreements
      in form and substance reasonably satisfactory to the Holder and approved by
      the
      Holder (which such approval shall not be unreasonably withheld) prior to such
      Fundamental Transaction, including agreements to deliver to the Holder of the
      Warrant in exchange for such Warrant a security of the Successor Entity
      evidenced by a written instrument substantially similar in form and substance
      to
      this Warrant, including, without limitation, an adjusted exercise price equal
      to
      the value for the shares of Common Stock reflected by the terms of such
      Fundamental Transaction, and exercisable for a corresponding number of shares
      of
      capital stock equivalent to the shares of Common Stock acquirable and receivable
      upon exercise of this Warrant (without regard to any limitations on the exercise
      of this Warrant) prior to such Fundamental Transaction, and reasonably
      satisfactory to the Holder and (ii) the Successor Entity (including its
      Parent Entity) is a publicly traded corporation whose common stock is quoted
      on
      or listed for trading on an Eligible Market. Upon the occurrence of any
      Fundamental Transaction, the Successor Entity shall succeed to, and be
      substituted for (so that from and after the date of such Fundamental
      Transaction, the provisions of this Warrant referring to the “Company”
shall
      refer instead to the Successor Entity), and may exercise every right and power
      of the Company and shall assume all of the obligations of the Company under
      this
      Warrant with the same effect as if such Successor Entity had been named as
      the
      Company herein. Upon consummation of the Fundamental Transaction, the Successor
      Entity shall deliver to the Holder confirmation that there shall be issued
      upon
      exercise of this Warrant at any time after the consummation of the Fundamental
      Transaction, in lieu of the shares of the Common Stock (or other securities,
      cash, assets or other property) issuable upon the exercise of the Warrant prior
      to such Fundamental Transaction, such shares of the publicly traded common
      stock
      (or its equivalent) of the Successor Entity (including its Parent Entity) which
      the Holder would have been entitled to receive upon the happening of such
      Fundamental Transaction had this Warrant been converted immediately prior to
      such Fundamental Transaction, as adjusted in accordance with the provisions
      of
      this Warrant. In addition to and not in substitution for any other rights
      hereunder, prior to the consummation of any Fundamental Transaction pursuant
      to
      which holders of shares of Common Stock are entitled to receive securities
      or
      other assets with respect to or in exchange for shares of Common Stock (a
“Corporate
      Event”),
      the
      Company shall make appropriate provision to insure that the Holder will
      thereafter have the right to receive upon an exercise of this Warrant at any
      time after the consummation of the Fundamental Transaction but prior to the
      Expiration Date, in lieu of the shares of the Common Stock (or other securities,
      cash, assets or other property) issuable upon the exercise of the Warrant prior
      to such Fundamental Transaction, such shares of stock, securities, cash, assets
      or any other property whatsoever (including warrants or other purchase or
      subscription rights) which the Holder would have been entitled to receive upon
      the happening of such Fundamental Transaction had the Warrant been exercised
      immediately prior to such Fundamental Transaction. The provisions of this
      Section shall apply similarly and equally to successive Fundamental Transactions
      and Corporate Events and shall be applied without regard to any limitations
      on
      the exercise of this Warrant.

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

    (c) Notwithstanding
      the foregoing and the provisions of Section 4(b) above, in the event of a
      Change of Control, if the Holder has not exercised the Warrant in full prior
      to
      the consummation of the Change of Control, then the Holder shall have the right
      to require such Successor Entity to purchase this Warrant from the Holder by
      paying to the Holder, simultaneously with the consummation of the Change of
      Control and in lieu of the warrant referred to in Section 4(b) cash in the
      amount equal to the value of the remaining unexercised portion of this Warrant
      on the date of such consummation, which value shall be determined by use of
      the
      Black-Scholes Option Pricing Model reflecting (i) a risk-free interest rate
      corresponding to the U.S. Treasury rate for a period equal to the remaining
      term
      of this Warrant as of such date of request and (ii) an expected volatility
      equal to the one hundred (100) day volatility obtained from the HVT function
      on
      Bloomberg; provided that if such function yields a volatility (x) less than
      50%, the expected volatility shall be equal to 50% and (y) greater than
      80%, the expected volatility shall be equal to 80%.

     

    5.  NONCIRCUMVENTION.
      The
      Company hereby covenants and agrees that the Company will not, by amendment
      of
      its Articles of Incorporation, Bylaws or through any reorganization, transfer
      of
      assets, consolidation, merger, scheme of arrangement, 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, and will at
      all
      times in good faith carry out all the provisions of this Warrant and take all
      action as may be required to protect the rights of the Holder. Without limiting
      the generality of the foregoing, the Company (i) shall not increase the par
      value of any shares of Common Stock receivable upon the exercise of this Warrant
      above the Exercise Price then in effect, and (ii) shall take all such
      actions as may be necessary or appropriate in order that the Company may validly
      and legally issue fully paid and nonassessable shares of Common Stock upon
      the
      exercise of this Warrant (without regard to any limitations on
      exercise).

     

    6.  WARRANT
      HOLDER NOT DEEMED A STOCKHOLDER.
      Except
      as otherwise specifically provided herein, the Holder, solely in such Person’s
      capacity as a holder of this Warrant, shall not be entitled to vote or receive
      dividends or be deemed the holder of share capital of the Company for any
      purpose, nor shall anything contained in this Warrant be construed to confer
      upon the Holder, solely in such Person’s capacity as the Holder of this Warrant,
      any of the rights of a stockholder of the Company or any right to vote, give
      or
      withhold consent to any corporate action (whether any reorganization, issue
      of
      stock, reclassification of stock, consolidation, merger, conveyance or
      otherwise), receive notice of meetings, receive dividends or subscription
      rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares
      which such Person is then entitled to receive upon the due exercise of this
      Warrant. In addition, nothing contained in this Warrant shall be construed
      as
      imposing any liabilities on the Holder to purchase any securities (upon exercise
      of this Warrant or otherwise) or as a stockholder of the Company, whether such
      liabilities are asserted by the Company or by creditors of the Company.
      Notwithstanding this Section 6, the Company shall provide the Holder with
      copies of the same notices and other information given to the shareholders
      of
      the Company generally, contemporaneously with the giving thereof to the
      shareholders.

     

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

    7.  REISSUANCE
      OF WARRANT.

     

    (a)  Transfer
      of Warrant.
      If this
      Warrant is to be transferred, the Holder shall surrender this Warrant to the
      Company, whereupon the Company will subject to the satisfaction of the transfer
      provisions of the Securities Purchase Agreement forthwith issue and deliver
      upon
      the order of the Holder a new warrant (in accordance with Section 7(d)),
      registered in the name of the registered transferee or assignee, representing
      the right to purchase the number of Warrant Shares being transferred by the
      Holder and, if less then the total number of Warrant Shares then underlying
      this
      Warrant is being transferred, a new warrant (in accordance with
      Section 7(d)) to the Holder representing the right to purchase the number
      of Warrant Shares not being transferred.

     

    (b)  Lost,
      Stolen or Mutilated Warrant.
      Upon
      receipt by the Company of evidence reasonably satisfactory to the Company of
      the
      loss, theft, destruction or mutilation of this Warrant, and, in the case of
      loss, theft or destruction, of any indemnification undertaking by the Holder
      to
      the Company in customary form and, in the case of mutilation, upon surrender
      and
      cancellation of this Warrant, the Company shall execute and deliver to the
      Holder a new warrant (in accordance with Section 7(d)) representing the
      right to purchase the Warrant Shares then underlying this Warrant.

     

    (c)  Exchangeable
      for Multiple Warrants.
      This
      Warrant is exchangeable, upon the surrender hereof by the Holder at the
      principal office of the Company, for a new warrant or warrants (in accordance
      with Section 7(d)) representing in the aggregate the right to purchase the
      number of Warrant Shares then underlying this Warrant, and each such new warrant
      will represent the right to purchase such portion of such Warrant Shares as
      is
      designated by the Holder at the time of such surrender; provided, however,
      that
      no Warrants for fractional shares of Common Stock shall be given.

     

    (d)  Issuance
      of New Warrants.
      Whenever the Company is required to issue a new warrant pursuant to the terms
      of
      this Warrant, such new warrant (i) shall be of like tenor with this
      Warrant, (ii) shall represent, as indicated on the face of such new
      warrant, the right to purchase the Warrant Shares then underlying this Warrant
      (or in the case of a new warrant being issued pursuant to Section 7(a) or
      Section 7(c), the Warrant Shares designated by the Holder which, when added
      to the number of shares of Common Stock underlying the other new warrants issued
      in connection with such issuance, does not exceed the number of Warrant Shares
      then underlying this Warrant), (iii) shall have an issuance date, as
      indicated on the face of such new warrant which is the same as the Issuance
      Date, and (iv) shall have the same rights and conditions as this
      Warrant.

     

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

    8.  NOTICES.
      Whenever notice is required to be given under this Warrant, unless otherwise
      provided herein, such notice shall be given in accordance with the notice
      provision of the Securities Purchase Agreement. The Company shall provide the
      Holder with prompt written notice of all actions taken pursuant to this Warrant,
      including in reasonable detail a description of such action and the reason
      therefore. Without limiting the generality of the foregoing, the Company will
      give written notice to the Holder (i) immediately upon any adjustment of
      the Exercise Price, setting forth in reasonable detail, and certifying, the
      calculation of such adjustment and (ii) at least fifteen (15) days prior to
      the date on which the Company closes its books or takes a record (A) with
      respect to any dividend or distribution upon the shares of Common Stock,
      (B) with respect to any grants, issuances or sales of any Options,
      Convertible Securities or rights to purchase stock, warrants, securities or
      other property to holders of shares of Common Stock or (C) for determining
      rights to vote with respect to any Fundamental Transaction, dissolution or
      liquidation, provided in each case that such information shall be made known
      to
      the public prior to or in conjunction with such notice being provided to the
      Holder.

     

    9.  AMENDMENT
      AND WAIVER.
      No term
      of this Warrant may be amended, modified or waived unless pursuant to a writing
      signed by the Company and the Holder.

     

    10.  GOVERNING
      LAW.
      This
      Warrant shall be governed by and construed and enforced in accordance with,
      and
      all questions concerning the construction, validity, interpretation and
      performance of this Warrant shall be governed by, the internal laws of the
      State
      of New Jersey, without giving effect to any choice of law or conflict of law
      provision or rule (whether of the State of New Jersey or any other
      jurisdictions) that would cause the application of the laws of any jurisdictions
      other than the State of New Jersey.

     

    11.  CONSTRUCTION;
      HEADINGS.
      This
      Warrant shall be deemed to be jointly drafted by the Company and the Buyer
      and
      shall not be construed against any person as the drafter hereof. The headings
      of
      this Warrant are for convenience of reference and shall not form part of, or
      affect the interpretation of, this Warrant.

     

    12.  DISPUTE
      RESOLUTION.
      In the
      case of a dispute as to the determination of the Exercise Price or the
      arithmetic calculation of the Warrant Shares, the Company shall submit the
      disputed determinations or arithmetic calculations via facsimile within three
      (3) Business Days of receipt of the Exercise Notice giving rise to such dispute,
      as the case may be, to the Holder. If the Holder and the Company are unable
      to
      agree upon such determination or calculation of the Exercise Price or the
      Warrant Shares within three (3) Business Days of such disputed determination
      or
      arithmetic calculation being submitted to the Holder, then the Company shall,
      within three (3) Business Days submit via facsimile (a) the disputed
      determination of the Exercise Price to an independent, reputable investment
      bank
      selected by the Company and approved by the Holder or (b) the disputed
      arithmetic calculation of the Warrant Shares to the Company’s independent,
      outside accountant. The Company shall cause at its expense the investment bank
      or the accountant, as the case may be, to perform the determinations or
      calculations and notify the Company and the Holder of the results no later
      than
      ten (10) Business Days from the time it receives the disputed determinations
      or
      calculations. Such investment bank’s or accountant’s determination or
      calculation, as the case may be, shall be binding upon all parties absent
      demonstrable error.

     

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

    13.  REMEDIES,
      OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF.
      The
      remedies provided in this Warrant shall be cumulative and in addition to all
      other remedies available under this Warrant and the other Transaction Documents,
      at law or in equity (including a decree of specific performance and/or other
      injunctive relief), and nothing herein shall limit the right of the Holder
      right
      to pursue actual damages for any failure by the Company to comply with the
      terms
      of this Warrant. The Company acknowledges that a breach by it of its obligations
      hereunder will cause irreparable harm to the Holder and that the remedy at
      law
      for any such breach may be inadequate. The Company therefore agrees that, in
      the
      event of any such breach or threatened breach, the holder of this Warrant shall
      be entitled, in addition to all other available remedies, to an injunction
      restraining any breach, without the necessity of showing economic loss and
      without any bond or other security being required.

     

    14.  TRANSFER.
      This
      Warrant may be offered for sale, sold, transferred or assigned without the
      consent of the Company, except as may otherwise be restricted by
      Section 2(f) of the Securities Purchase Agreement.

     

    15.  CERTAIN
      DEFINITIONS.
      For
      purposes of this Warrant, the following terms shall have the following
      meanings:

     

    (a) “Bloomberg”
means
      Bloomberg Financial Markets.

     

    (b) “Business
      Day”
means
      any day other than Saturday, Sunday or other day on which commercial banks
      in
      The City of Newark, New Jersey are authorized or required by law to remain
      closed.

     

    (c) “Change
      of Control”
means
      any Fundamental Transaction other than (i) any reorganization,
      recapitalization or reclassification of the Common Stock or business combination
      in which the Company is the publicly traded surviving entity in which the
      holders of the Company’s voting power immediately prior to such reorganization,
      recapitalization or reclassification or business combination continue after
      such
      reorganization, recapitalization or reclassification or business combination
      to
      hold publicly traded securities and, directly or indirectly, the voting power
      of
      the surviving entity or entities necessary to elect a majority of the members
      of
      the board of directors (or their equivalent if other than a corporation) of
      such
      entity or entities, or (ii) pursuant to a migratory merger effected solely
      for the purpose of changing the jurisdiction of incorporation of the
      Company.

     

    (d) “Closing
      Bid Price”
and
      “Closing
      Sale Price”
means,
      for any security as of any date, the last closing bid price and last closing
      trade price, respectively, for such security on the Principal Market, as
      reported by Bloomberg, or, if the Principal Market begins to operate on an
      extended hours basis and does not designate the closing bid price or the closing
      trade price, as the case may be, then the last bid price or last trade price,
      respectively, of such security prior to 4:00:00 p.m., New York time, as reported
      by Bloomberg, or, if the Principal Market is not the principal securities
      exchange or trading market for such security, the last closing bid price or
      last
      trade price, respectively, of such security on the principal securities exchange
      or trading market where such security is listed or traded as reported by
      Bloomberg, or if the foregoing do not apply, the last closing bid price or
      last
      trade price, respectively, of such security in the over-the-counter market
      on
      the electronic bulletin board for such security as reported by Bloomberg, or,
      if
      no closing bid price or last trade price, respectively, is reported for such
      security by Bloomberg, the average of the bid prices, or the ask prices,
      respectively, of any market makers for such security as reported in the “pink
      sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If
      the Closing Bid Price or the Closing Sale Price cannot be calculated for a
      security on a particular date on any of the foregoing bases, the Closing Bid
      Price or the Closing Sale Price, as the case may be, of such security on such
      date shall be the fair market value as mutually determined by the Company and
      the Holder. If the Company and the Holder are unable to agree upon the fair
      market value of such security, then such dispute shall be resolved pursuant
      to
      Section 12. All such determinations to be appropriately adjusted for any
      stock dividend, stock split, stock combination or other similar transaction
      during the applicable calculation period.

     

    
      
         

      

      
        -13-

        
          

        

      

      
         

      

    

    (e) “Common
      Stock”
means
      (i) the Company’s shares of Common Stock, par value $0.001 per share, and
      (ii) any share capital into which such Common Stock shall have been changed
      or any share capital resulting from a reclassification of such Common
      Stock.

     

    (f) “Convertible
      Securities”
means
      any stock or securities (other than Options) directly or indirectly convertible
      into or exercisable or exchangeable for shares of Common Stock.

     

    (g) “Eligible
      Market”
means
      the Principal Market, the American Stock Exchange, The New York Stock Exchange,
      Inc., or the Nasdaq National Market.

     

    (h) “Expiration
      Date”
means
      the date eighty-four (84) months after the Issuance Date or, if such date falls
      on a day other than a Business Day or on which trading does not take place
      on
      the Principal Market (a “Holiday”),
      the
      next date that is not a Holiday.

     

    (i) “Fundamental
      Transaction”
means
      that the Company shall, directly or indirectly, in one or more related
      transactions, (i) consolidate or merge with or into (whether or not the
      Company is the surviving corporation) another Person or Persons, or
      (ii) sell, assign, transfer, convey or otherwise dispose of all or
      substantially all of the properties or assets of the Company to another Person,
      or (iii) allow another Person to make a purchase, tender or exchange offer
      that is accepted by the holders of more than 50% of the outstanding shares
      of
      Voting Stock (not including any shares of Voting Stock held by the Person or
      Persons making or party to, or associated or affiliated with the Persons making
      or party to, such purchase, tender or exchange offer), or (iv) consummate a
      stock purchase agreement or other business combination (including, without
      limitation, a reorganization, recapitalization, spin-off or scheme of
      arrangement) with another Person whereby such other Person acquires more than
      the 50% of the outstanding shares of Voting Stock (not including any shares
      of
      Voting Stock held by the other Person or other Persons making or party to,
      or
      associated or affiliated with the other Persons making or party to, such stock
      purchase agreement or other business combination), (v) reorganize,
      recapitalize or reclassify its Common Stock, or (vi) any “person” or
“group” (as these terms are used for purposes of Sections 13(d) and 14(d)
      of the 1934 Act) is or shall become the “beneficial owner” (as defined in
      Rule 13d-3 under the 1934 Act), directly or indirectly, of 50% of the
      aggregate Voting Stock of the Company.

     

    (j) “Options”
means
      any rights, warrants or options to subscribe for or purchase shares of Common
      Stock or Convertible Securities.

     

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

    (k) “Parent
      Entity”
of
      a
      Person means an entity that, directly or indirectly, controls the applicable
      Person and whose common stock or equivalent equity security is quoted or listed
      on an Eligible Market, or, if there is more than one such Person or Parent
      Entity, the Person or Parent Entity with the largest public market
      capitalization as of the date of consummation of the Fundamental
      Transaction.

     

    (l) “Person”
means
      an individual, a limited liability company, a partnership, a joint venture,
      a
      corporation, a trust, an unincorporated organization, any other entity and
      a
      government or any department or agency thereof.

     

    (m) “Principal
      Market”
means
      OTC Bulletin Board.

     

    (n) “Registration
      Rights Agreement”
means
      that certain registration rights agreement by and among the Company and the
      Buyer.

     

    (o) “Successor
      Entity”
means
      the Person (or, if so elected by the Holder, the Parent Entity) formed by,
      resulting from or surviving any Fundamental Transaction or the Person (or,
      if so
      elected by the Holder, the Parent Entity) with which such Fundamental
      Transaction shall have been entered into.

     

    [Signature
      Page Follows]

     

    
      
         

      

      
        -15-

        
          

        

      

      
         

      

    

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to Purchase Common Stock
      to
      be duly executed as of the Issuance Date set out above.

     

    
      	 	 	 
	 	NATURAL
              NUTRITION, INC.
	 
 	 
 	 
 
	 	By:  	/s/ Timothy
              J. Connolly
	 	
              

              Name: Timothy
                J. Connolly

              Title: Chief
                Executive Officer

            

    

    
      
         

      

      
        -16-

        
          

        

      

      
         

      

    

    EXHIBIT
      A

     

    EXERCISE
      NOTICE

     

    TO
      BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS

    WARRANT
      TO PURCHASE COMMON STOCK

     

    NATURAL
      NUTRITION, INC.

     

    The
      undersigned holder hereby exercises the right to purchase __________ of the
      shares of Common Stock (“Warrant
      Shares”)
      of
      Natural Nutrition, Inc., a Nevada corporation (the “Company”),
      evidenced by the attached Warrant to Purchase Common Stock (the “Warrant”).
      Capitalized terms used herein and not otherwise defined shall have the
      respective meanings set forth in the Warrant.

     

    1.  Form
      of Exercise Price.
      The
      Holder intends that payment of the Exercise Price shall be made as (check boxes
      that apply):

     

    o“Cash
      Exercise”
with
      respect to _____________ Warrant Shares; 

     

    and/or

     

    o“Cashless
      Exercise”
with
      respect to _____________ Warrant Shares.

     

    2.  Payment
      of Exercise Price.
      In the
      event that the holder has elected a Cash Exercise with respect to some or all
      of
      the Warrant Shares to be issued pursuant hereto, the holder shall pay the
      Aggregate Exercise Price in the sum of $__________ to the Company in accordance
      with the terms of the Warrant.

     

    3.  Delivery
      of Warrant Shares.
      The
      Company shall deliver to the holder _____________ Warrant Shares in accordance
      with the terms of the Warrant.

     

    4.  By
      its
      delivery of this Exercise Notice, the undersigned represents and warrants to
      the
      Company that in giving effect to the exercise evidenced hereby the Holder will
      not beneficially own in excess of the number of shares of Common Stock
      (determined in accordance with Section 13(d) of the Securities Exchange Act
      of 1934) permitted to be owned under Section 1(f) of this Warrant to which
      this notice relates.

     

    Date:,_______________

     

    __________________

    Name
      of
      Registered Holder

     

    By:
      ___________________

        Name: 

        Title: 

     

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    ACKNOWLEDGMENT

     

    The
      Company hereby acknowledges this Exercise Notice and, if applicable, hereby
      directs [_____________________] (the “Transfer
      Agent”)
      to
      issue the above indicated number of shares of Common Stock in accordance with
      the Transfer Agent Instructions dated May 31, 2007 from the Company and
      acknowledged and agreed to by the Transfer Agent.

    
       

      
        	 	 	 
	 	NATURAL
                NUTRITION, INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
                

                Name: 

                Title: 

              

      

      
        
           

        

      

    

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Warrant
      Shares Exercise Log

     

    
      	
              Date

            	 	
              Number
                of 

              Warrant
                Shares Available to be 

              Exercised

            	 	
              Number
                of 

              Warrant
                Shares 

              Exercised

            	 	
              Number
                of 

              Warrant
                Shares 

              Remaining
                to be Exercised

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