Document:

EX-10.5

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

                        CALLABLE SECURED CONVERTIBLE NOTE

Troy, Michigan
January 31, 2006                                                     $__________

                  FOR  VALUE  RECEIVED,   REDOX  TECHNOLOGY  CORPORATION  (A/K/A
MIDNIGHT AUTO HOLDING CORP.),  a Delaware  corporation  (hereinafter  called the
"BORROWER"),  hereby  promises to pay to the order of  _____________________  or
registered  assigns (the "HOLDER") the sum of  $__________,  on January 31, 2009
(the  "MATURITY  DATE"),  and to pay  interest on the unpaid  principal  balance
hereof at the rate of ten  percent  (10%) per annum from  January  31, 2006 (the
"ISSUE  DATE") until the same  becomes due and  payable,  whether at maturity or
upon  acceleration  or by prepayment  or  otherwise.  Any amount of principal or
interest on this Note which is not paid when due shall bear interest at the rate
of fifteen  percent  (15%) per annum from the due date thereof until the same is
paid ("DEFAULT  INTEREST").  Interest shall commence accruing on the issue date,
shall be computed on the basis of a 365-day  year and the actual  number of days
elapsed and shall be payable,  quarterly on March 31, June 30,  September 30 and
December  31 of each year  beginning  on the last day of the first full  quarter
after Issue Date.  All payments due hereunder (to the extent not converted  into
common stock,  $.00005 par value per share, of the Borrower (the "COMMON STOCK")
in accordance with the terms hereof) shall be made in lawful money of the United
States of  America.  All  payments  shall be made at such  address as the Holder
shall  hereafter give to the Borrower by written notice made in accordance  with
the  provisions  of this Note.  Whenever  any amount  expressed to be due by the
terms of this Note is due on any day which is not a business day, the same shall
instead be due on the next  succeeding  day which is a business  day and, in the
case of any  interest  payment  date which is not the date on which this Note is
paid in full,  the  extension  of the due date  thereof  shall not be taken into
account for purposes of determining  the amount of interest due on such date. As
used in this  Note,  the term  "business  day"  shall  mean any day other than a
Saturday, Sunday or a day on which commercial banks in the city of New York, New
York are authorized or required by law or executive order to remain closed. Each
capitalized term used herein, and not otherwise defined,  shall have the meaning
ascribed thereto

<PAGE>

in that certain Securities Purchase Agreement,  dated January 31, 2006, pursuant
to which this Note was originally issued (the "PURCHASE AGREEMENT").

         This Note is free from all taxes,  liens,  claims and encumbrances with
respect to the issue  thereof and shall not be subject to  preemptive  rights or
other  similar  rights  of  shareholders  of the  Borrower  and will not  impose
personal  liability  upon the holder  thereof.  The  obligations of the Borrower
under  this Note  shall be secured by that  certain  Security  Agreement  by and
between the Borrower and the Holder of even date herewith.

         The following terms shall apply to this Note:

                          ARTICLE I. CONVERSION RIGHTS

                  1.1      CONVERSION  RIGHT.  The  Holder  shall have the right
from  time to  time,  and at any  time on or  prior  to the  earlier  of (i) the
Maturity Date and (ii) the date of payment of the Default  Amount (as defined in
Article III) pursuant to Section 1.6(a) or Article III, the Optional  Prepayment
Amount (as  defined in Section  5.1) or (iii) any  payments  pursuant to Section
1.7, each in respect of the remaining  outstanding principal amount of this Note
to convert all or any part of the  outstanding  and unpaid  principal  amount of
this Note into fully paid and  non-assessable  shares of Common  Stock,  as such
Common Stock exists on the Issue Date,  or any shares of capital  stock or other
securities  of the  Borrower  into which such Common  Stock shall  hereafter  be
changed  or  reclassified  at the  conversion  price  (the  "CONVERSION  PRICE")
determined as provided herein (a "CONVERSION");  PROVIDED,  HOWEVER,  that in no
event shall the Holder be entitled to convert any portion of this Note in excess
of that portion of this Note upon  conversion of which the sum of (1) the number
of shares of Common Stock  beneficially  owned by the Holder and its  affiliates
(other  than  shares of Common  Stock  which  may be deemed  beneficially  owned
through the ownership of the unconverted portion of the Notes or the unexercised
or unconverted portion of any other security of the Borrower (including, without
limitation,  the  warrants  issued  by the  Borrower  pursuant  to the  Purchase
Agreement)  subject to a limitation on  conversion or exercise  analogous to the
limitations  contained  herein)  and (2) the  number of  shares of Common  Stock
issuable  upon the  conversion of the portion of this Note with respect to which
the  determination  of this proviso is being made,  would  result in  beneficial
ownership by the Holder and its affiliates of more than 4.9% of the  outstanding
shares of Common Stock. For purposes of the proviso to the immediately preceding
sentence,  beneficial  ownership  shall be determined in accordance with Section
13(d) of the Securities Exchange Act of 1934, as amended,  and Regulations 13D-G
thereunder,  except as  otherwise  provided in clause (1) of such  proviso.  The
number of shares of Common Stock to be issued upon each  conversion of this Note
shall be determined by dividing the Conversion  Amount (as defined below) by the
applicable  Conversion  Price then in effect on the date specified in the notice
of  conversion,  in the form  attached  hereto  as  Exhibit  A (the  "NOTICE  OF
CONVERSION"), delivered to the Borrower by the Holder in accordance with Section
1.4 below;  provided that the Notice of Conversion is submitted by facsimile (or
by other means resulting in, or reasonably expected to result in, notice) to the
Borrower  before 6:00 p.m., New York, New York time on such conversion date (the
"CONVERSION  DATE").  The term  "CONVERSION  AMOUNT" means,  with respect to any
conversion of this Note, the sum of (1) the principal  amount of this Note to be
converted in such  conversion PLUS (2) accrued and unpaid  interest,  if any, on
such principal amount at the interest

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rates provided in this Note to the Conversion Date PLUS (3) Default Interest, if
any, on the amounts referred to in the immediately  preceding clauses (1) and/or
(2) PLUS (4) at the Holder's option,  any amounts owed to the Holder pursuant to
Sections  1.3 and 1.4(g)  hereof or  pursuant  to Section  2(c) of that  certain
Registration  Rights  Agreement,  dated as of  January  31,  2006,  executed  in
connection with the initial  issuance of this Note and the other Notes issued on
the Issue Date (the "REGISTRATION RIGHTS AGREEMENT").

                  1.2      CONVERSION PRICE.

                           (a)      CALCULATION   OF   CONVERSION   PRICE.   The
Conversion  Price shall be the lesser of (i) the Variable  Conversion  Price (as
defined  herein)  and  (ii) the  Fixed  Conversion  Price  (as  defined  herein)
(subject,  in each  case,  to  equitable  adjustments  for stock  splits,  stock
dividends  or  rights  offerings  by the  Borrower  relating  to the  Borrower's
securities or the  securities of any  subsidiary of the Borrower,  combinations,
recapitalization,  reclassifications,  extraordinary  distributions  and similar
events).  The "VARIABLE  CONVERSION PRICE" shall mean the Applicable  Percentage
(as defined herein) multiplied by the Market Price (as defined herein).  "MARKET
PRICE"  means the  average of the lowest  three (3)  Trading  Prices (as defined
below) for the Common Stock during the twenty (20) Trading Day period ending one
Trading Day prior to the date the Conversion Notice is sent by the Holder to the
Borrower via facsimile (the "CONVERSION  DATE").  "TRADING PRICE" means, for any
security as of any date,  the  intraday  trading  price on the  Over-the-Counter
Bulletin  Board  (the  "OTCBB")  as  reported  by a reliable  reporting  service
mutually  acceptable  to and  hereafter  designated  by Holders of a majority in
interest  of the Notes and the  Borrower  or, if the OTCBB is not the  principal
trading market for such security, the intraday trading price of such security on
the  principal  securities  exchange or trading  market  where such  security is
listed or traded or, if no intraday  trading price of such security is available
in any of the foregoing  manners,  the average of the intraday trading prices of
any market  makers for such security that are listed in the "pink sheets" by the
National  Quotation  Bureau,  Inc. If the Trading Price cannot be calculated for
such security on such date in the manner provided above, the Trading Price shall
be the fair market value as mutually  determined by the Borrower and the holders
of a majority in interest of the Notes being converted for which the calculation
of the Trading Price is required in order to determine the  Conversion  Price of
such Notes. "TRADING DAY" shall mean any day on which the Common Stock is traded
for any period on the OTCBB,  or on the principal  securities  exchange or other
securities  market on which the Common Stock is then being  traded.  "APPLICABLE
PERCENTAGE" shall mean 25%; provided,  however,  that the Applicable  Percentage
shall be increased to (i) 30% in the event that the  Registration  Statement (as
defined in the Registration  Rights  Agreement) is filed on or before the Filing
Date (as defined in the Registration Rights Agreement) and (ii) 40% in the event
that  the  Registration   Statement  (as  defined  in  the  Registration  Rights
Agreement) becomes effective on or before the Effectiveness Deadline (as defined
in the Registration Rights Agreement).

                           (b)      CONVERSION PRICE DURING MAJOR ANNOUNCEMENTS.
Notwithstanding  anything  contained in Section  1.2(a) to the contrary,  in the
event  the  Borrower  (i)  makes  a  public  announcement  that  it  intends  to
consolidate  or merge with any other  corporation  (other than a merger in which
the Borrower is the surviving or continuing corporation and its capital stock is
unchanged)  or sell or transfer  all or  substantially  all of the assets of the
Borrower or (ii) any person,  group or entity (including the Borrower)  publicly
announces a tender offer to purchase 50% or more of the Borrower's  Common Stock
(or any

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<PAGE>

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

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

                  If,  at any time a Holder  of this  Note  submits  a Notice of
Conversion,  and the Borrower does not have  sufficient  authorized but unissued
shares of Common Stock  available to effect such  conversion in accordance  with
the  provisions of this Article I (a "CONVERSION  DEFAULT"),  subject to Section
4.8,  the  Borrower  shall issue to the Holder all of the shares of Common Stock
which are then  available  to effect such  conversion.  The portion of this Note
which the Holder included in its Conversion  Notice and which exceeds the amount
which is then  convertible  into  available  shares of Common Stock (the "EXCESS
AMOUNT") shall,  notwithstanding  anything to the contrary contained herein, not
be convertible  into Common Stock in accordance with the terms hereof until (and
at the Holder's option at any time after) the

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<PAGE>

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

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

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

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

                  1.4      METHOD OF CONVERSION.

                           (a)      MECHANICS OF CONVERSION.  Subject to Section
1.1,  this Note may be  converted  by the Holder in whole or in part at any time
from time to time after the Issue  Date,  by (A)  submitting  to the  Borrower a
Notice of Conversion (by facsimile or other reasonable

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means of communication dispatched on the Conversion Date prior to 6:00 p.m., New
York, New York time) and (B) subject to Section 1.4(b),  surrendering  this Note
at the principal office of the Borrower.

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

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

                           (d)      DELIVERY  OF COMMON  STOCK UPON  CONVERSION.
Upon receipt by the  Borrower  from the Holder of a facsimile  transmission  (or
other reasonable means of communication)  of a Notice of Conversion  meeting the
requirements  for conversion as provided in this Section 1.4, the Borrower shall
issue and  deliver or cause to be issued and  delivered  to or upon the order of
the Holder  certificates  for the Common  Stock  issuable  upon such  conversion
within five (5)  business  days after such receipt  (and,  solely in the case of
conversion of the entire unpaid principal amount hereof, surrender of this Note)
(such second  business day being  hereinafter  referred to as the "DEADLINE") in
accordance with the terms hereof and the Purchase Agreement (including,  without
limitation,  in accordance with the requirements of Section 2(g) of the Purchase
Agreement  that  certificates  for shares of Common Stock issued on or after the
effective date of the Registration  Statement upon conversion of this Note shall
not bear any restrictive legend).

                           (e)      OBLIGATION  OF  BORROWER  TO DELIVER  COMMON
STOCK. Upon receipt by the Borrower of a Notice of Conversion,  the Holder shall
be deemed to be the holder

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of record of the Common Stock  issuable upon such  conversion,  the  outstanding
principal  amount  and the amount of accrued  and unpaid  interest  on this Note
shall be reduced to reflect such conversion,  and, unless the Borrower  defaults
on its obligations  under this Article I, all rights with respect to the portion
of this Note being so converted  shall forthwith  terminate  except the right to
receive the Common Stock or other  securities,  cash or other assets,  as herein
provided,  on such  conversion.  If the  Holder  shall  have  given a Notice  of
Conversion as provided  herein,  the Borrower's  obligation to issue and deliver
the  certificates  for  Common  Stock  shall  be  absolute  and   unconditional,
irrespective of the absence of any action by the Holder to enforce the same, any
waiver or consent with  respect to any  provision  thereof,  the recovery of any
judgment  against any person or any action to enforce  the same,  any failure or
delay in the  enforcement of any other  obligation of the Borrower to the holder
of record, or any setoff, counterclaim,  recoupment,  limitation or termination,
or any breach or alleged breach by the Holder of any obligation to the Borrower,
and  irrespective  of any other  circumstance  which might  otherwise limit such
obligation of the Borrower to the Holder in connection with such conversion. The
Conversion  Date  specified in the Notice of Conversion  shall be the Conversion
Date so long as the Notice of Conversion is received by the Borrower before 6:00
p.m., New York, New York time, on such date.

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

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

                  1.5      CONCERNING  THE  SHARES.  The shares of Common  Stock
issuable upon conversion of this Note may not be sold or transferred  unless (i)
such shares are sold pursuant to an effective  registration  statement under the
Act or (ii) the Borrower or its transfer agent shall have been furnished with an
opinion  of  counsel  (which  opinion  shall be in  form,  substance  and  scope
customary for opinions of counsel in comparable transactions) to the effect that
the shares to be sold or transferred  may be sold or transferred  pursuant to an
exemption from such

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registration  or (iii) such shares are sold or transferred  pursuant to Rule 144
under  the Act (or a  successor  rule)  ("RULE  144") or (iv)  such  shares  are
transferred  to an  "affiliate"  (as  defined in Rule 144) of the  Borrower  who
agrees to sell or  otherwise  transfer the shares only in  accordance  with this
Section  1.5 and who is an  Accredited  Investor  (as  defined  in the  Purchase
Agreement).  Except as otherwise provided in the Purchase Agreement (and subject
to the removal  provisions  set forth  below),  until such time as the shares of
Common Stock issuable upon  conversion of this Note have been  registered  under
the Act as contemplated by the Registration Rights Agreement or otherwise may be
sold pursuant to Rule 144 without any restriction as to the number of securities
as of a particular date that can then be immediately  sold, each certificate for
shares of Common Stock  issuable upon  conversion of this Note that has not been
so included in an  effective  registration  statement  or that has not been sold
pursuant to an effective  registration  statement  or an exemption  that permits
removal of the legend,  shall bear a legend substantially in the following form,
as appropriate:

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

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

         1.6      EFFECT OF CERTAIN EVENTS.

                  (a)      EFFECT OF MERGER,  CONSOLIDATION,  ETC. At the option
of the Holder,  the sale,  conveyance or disposition of all or substantially all
of the assets of the Borrower, the effectuation by the Borrower of a transaction
or series of related  transactions in which more than 50% of the voting power of
the  Borrower is disposed  of, or the  consolidation,  merger or other  business
combination  of the Borrower with or into any other Person (as defined

                                       8
<PAGE>

below) or Persons  when the Borrower is not the survivor  shall  either:  (i) be
deemed to be an Event of Default (as defined in Article  III)  pursuant to which
the Borrower shall be required to pay to the Holder upon the consummation of and
as a condition to such  transaction  an amount  equal to the Default  Amount (as
defined in Article III) or (ii) be treated  pursuant to Section  1.6(b)  hereof.
"PERSON" shall mean any  individual,  corporation,  limited  liability  company,
partnership, association, trust or other entity or organization.

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

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

                                       9
<PAGE>

                           (d)      ADJUSTMENT DUE TO DILUTIVE ISSUANCE.  If, at
any time when any Notes are  issued  and  outstanding,  the  Borrower  issues or
sells, or in accordance with this Section 1.6(d) hereof is deemed to have issued
or sold, any shares of Common Stock for no  consideration or for a consideration
per  share  (before   deduction  of  reasonable   expenses  or   commissions  or
underwriting  discounts or  allowances in  connection  therewith)  less than the
Fixed  Conversion  Price in  effect  on the  date of such  issuance  (or  deemed
issuance)  of  such  shares  of  Common  Stock  (a  "DILUTIVE  ISSUANCE"),  then
immediately  upon the  Dilutive  Issuance,  the Fixed  Conversion  Price will be
reduced to the amount of the consideration per share received by the Borrower in
such Dilutive Issuance;  PROVIDED that only one adjustment will be made for each
Dilutive Issuance.

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

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

                                       10
<PAGE>

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

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

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

                                       11
<PAGE>

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

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

                         ARTICLE II. CERTAIN COVENANTS

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

                                       12
<PAGE>

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

                  2.3      BORROWINGS.  So long as the  Borrower  shall have any
obligation under this Note, the Borrower shall not, without the Holder's written
consent,  create,  incur,  assume or suffer to exist any  liability for borrowed
money in excess of $50,000,  except (a)  borrowings in existence or committed on
the date hereof and of which the Borrower has informed  Holder in writing  prior
to  the  date  hereof,   (b)   indebtedness  to  trade  creditors  or  financial
institutions incurred in the ordinary course of business or (c) borrowings,  the
proceeds of which shall be used to repay this Note.

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

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

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

                         ARTICLE III. EVENTS OF DEFAULT

                  If any of the following  events of default (each, an "EVENT OF
DEFAULT") shall occur:

                  3.1      FAILURE TO PAY  PRINCIPAL OR  INTEREST.  The Borrower
fails to pay the  principal  hereof or interest  thereon  when due on this Note,
whether at maturity,  upon a Trading Market Prepayment Event pursuant to Section
1.7, upon acceleration or otherwise;

                                       13
<PAGE>

                  3.2      CONVERSION  AND THE  SHARES.  The  Borrower  fails to
issue  shares of Common Stock to the Holder (or  announces or threatens  that it
will not honor  its  obligation  to do so) upon  exercise  by the  Holder of the
conversion rights of the Holder in accordance with the terms of this Note (for a
period of at least sixty (60) days, if such failure is solely as a result of the
circumstances governed by Section 1.3 and the Borrower is using its best efforts
to  authorize  a  sufficient  number  of  shares  of  Common  Stock  as  soon as
practicable),  fails  to  transfer  or cause  its  transfer  agent  to  transfer
(electronically  or in  certificated  form) any certificate for shares of Common
Stock issued to the Holder upon conversion of or otherwise pursuant to this Note
as and when required by this Note or the Registration Rights Agreement, or fails
to remove any restrictive legend (or to withdraw any stop transfer  instructions
in respect  thereof) on any certificate for any shares of Common Stock issued to
the Holder upon  conversion  of or  otherwise  pursuant to this Note as and when
required  by this  Note or the  Registration  Rights  Agreement  (or  makes  any
announcement,  statement  or  threat  that it  does  not  intend  to  honor  the
obligations  described in this  paragraph)  and any such failure shall  continue
uncured (or any  announcement,  statement or threat not to honor its obligations
shall not be rescinded  in writing)  for ten (10) days after the Borrower  shall
have been notified thereof in writing by the Holder;

                  3.3      FAILURE  TO  TIMELY  FILE   REGISTRATION   OR  EFFECT
REGISTRATION. The Borrower fails to file the Registration Statement within sixty
(60) days  following the Closing Date (as defined in the Purchase  Agreement) or
obtain  effectiveness  with  the  Securities  and  Exchange  Commission  of  the
Registration Statement within two hundred fifty (250) days following the Closing
Date (as  defined in the  Purchase  Agreement)  or such  Registration  Statement
lapses in effect  (or  sales  cannot  otherwise  be made  thereunder  effective,
whether  by  reason  of the  Borrower's  failure  to  amend  or  supplement  the
prospectus included therein in accordance with the Registration Rights Agreement
or otherwise) for more than twenty (20)  consecutive  days or forty (40) days in
any twelve month period after the Registration Statement becomes effective;

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

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

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

                                       14
<PAGE>

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

                  3.8      BANKRUPTCY. Bankruptcy, insolvency, reorganization or
liquidation proceedings or other proceedings for relief under any bankruptcy law
or any law for the  relief of debtors  shall be  instituted  by or  against  the
Borrower or any subsidiary of the Borrower;

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

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

                                       15
<PAGE>

the number of shares of Common Stock of the Borrower equal to the Default Amount
divided by the Conversion Price then in effect.

                           ARTICLE IV. MISCELLANEOUS

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

                  4.2      NOTICES.  Any notice herein  required or permitted to
be given  shall be in  writing  and may be  personally  served or  delivered  by
courier  or sent by United  States  mail and shall be deemed to have been  given
upon receipt if personally  served (which shall include telephone line facsimile
transmission)  or sent by courier or three (3) days after being deposited in the
United States mail, certified,  with postage pre-paid and properly addressed, if
sent by mail.  For the  purposes  hereof,  the address of the Holder shall be as
shown on the records of the Borrower;  and the address of the Borrower  shall be
3872 Rochester Road, Troy, MI 48083,  facsimile number:  586-783-1367.  Both the
Holder and the Borrower may change the address for service by service of written
notice to the other as herein provided.

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

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

                  4.5      COST OF COLLECTION. If default is made in the payment
of this Note,  the Borrower  shall pay the Holder  hereof  costs of  collection,
including reasonable attorneys' fees.

                  4.6      GOVERNING LAW. THIS NOTE SHALL BE ENFORCED,  GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO  AGREEMENTS  MADE AND TO BE  PERFORMED  ENTIRELY  WITHIN SUCH STATE,  WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS. THE BORROWER HEREBY SUBMITS TO THE
EXCLUSIVE  JURISDICTION OF THE UNITED STATES FEDERAL COURTS LOCATED IN NEW YORK,
NEW YORK WITH RESPECT TO ANY DISPUTE  ARISING  UNDER THIS NOTE,  THE  AGREEMENTS
ENTERED INTO IN CONNECTION  HEREWITH OR THE TRANSACTIONS  CONTEMPLATED HEREBY OR
THEREBY. BOTH PARTIES IRREVOCABLY WAIVE

                                       16
<PAGE>

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

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

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

                  4.9      DAMAGES  SHARES.  The shares of Common Stock that may
be  issuable  to the Holder  pursuant  to  Sections  1.3 and  1.4(g)  hereof and
pursuant to Section 2(c) of the Registration Rights Agreement ("DAMAGES SHARES")
shall be treated as Common Stock  issuable upon  conversion of this Note for all
purposes  hereof and shall be subject to all of the limitations and afforded all
of the rights of the other shares of Common Stock issuable hereunder,  including
without limitation, the right to be included in the Registration Statement filed
pursuant to the  Registration  Rights  Agreement.  For  purposes of  calculating
interest payable on the outstanding principal amount hereof, except as otherwise
provided herein, amounts convertible into Damages

                                       17
<PAGE>

Shares  ("DAMAGES  AMOUNTS") shall not bear interest but must be converted prior
to  the  conversion  of any  outstanding  principal  amount  hereof,  until  the
outstanding Damages Amounts is zero.

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

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

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

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

                                       18
<PAGE>

                             ARTICLE V. CALL OPTION

                  5.1      CALL OPTION. Notwithstanding anything to the contrary
contained  in this  Article  V, so long as (i) no Event of  Default  or  Trading
Market Prepayment Event shall have occurred and be continuing, (ii) the Borrower
has a  sufficient  number of  authorized  shares of Common  Stock  reserved  for
issuance  upon full  conversion  of the Notes,  then at any time after the Issue
Date,  and (iii) the Common  Stock is  trading  at or below $.04 per share,  the
Borrower  shall have the right,  exercisable  on not less than ten (10)  Trading
Days prior  written  notice to the Holders of the Notes (which notice may not be
sent to the Holders of the Notes until the  Borrower is  permitted to prepay the
Notes pursuant to this Section 5.1), to prepay all of the  outstanding  Notes in
accordance  with this  Section  5.1.  Any  notice of  prepayment  hereunder  (an
"OPTIONAL  PREPAYMENT")  shall be delivered to the Holders of the Notes at their
registered  addresses  appearing  on the books and records of the  Borrower  and
shall state (1) that the Borrower is  exercising  its right to prepay all of the
Notes  issued on the Issue Date and (2) the date of  prepayment  (the  "OPTIONAL
PREPAYMENT NOTICE").  On the date fixed for prepayment (the "OPTIONAL PREPAYMENT
Date"),  the Borrower shall make payment of the Optional  Prepayment  Amount (as
defined  below) to or upon the order of the Holders as  specified by the Holders
in writing to the  Borrower at least one (1)  business day prior to the Optional
Prepayment  Date. If the Borrower  exercises its right to prepay the Notes,  the
Borrower  shall make payment to the holders of an amount in cash (the  "OPTIONAL
PREPAYMENT  AMOUNT") equal to either (i) 135% (for prepayments  occurring within
thirty (30) days of the Issue Date), (ii) 145% for prepayments occurring between
thirty-one  (31) and  ninety  (90) days of the Issue  Date,  or (iii)  150% (for
prepayments  occurring after the ninetieth (90th) day following the Issue Date),
multiplied by the sum of (w) the then outstanding  principal amount of this Note
PLUS (x) accrued and unpaid interest on the unpaid principal amount of this Note
to the  Optional  Prepayment  Date PLUS (y)  Default  Interest,  if any,  on the
amounts  referred  to in clauses  (w) and (x) plus (z) any  amounts  owed to the
Holder pursuant to Sections 1.3 and 1.4(g) hereof or pursuant to Section 2(c) of
the Registration Rights Agreement (the then outstanding principal amount of this
Note to the date of payment PLUS the amounts referred to in clauses (x), (y) and
(z)  shall   collectively   be  known  as  the   "OPTIONAL   PREPAYMENT   SUM").
Notwithstanding notice of an Optional Prepayment, the Holders shall at all times
prior to the Optional  Prepayment  Date maintain the right to convert all or any
portion of the Notes in  accordance  with  Article I and any portion of Notes so
converted  after  receipt  of an  Optional  Prepayment  Notice  and prior to the
Optional  Prepayment  Date set forth in such notice and payment of the aggregate
Optional  Prepayment Amount shall be deducted from the principal amount of Notes
which are  otherwise  subject to  prepayment  pursuant  to such  notice.  If the
Borrower  delivers an Optional  Prepayment  Notice and fails to pay the Optional
Prepayment  Amount due to the Holders of the Notes within two (2) business  days
following the Optional  Prepayment  Date, the Borrower shall forever forfeit its
right to redeem the Notes pursuant to this Section 5.1.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       19
<PAGE>

                  IN WITNESS WHEREOF, Borrower has caused this Note to be signed
in its name by its duly authorized officer this 31st day of January, 2006.

                                             REDOX TECHNOLOGY CORPORATION

                                             By:_______________________________
                                                  Nicholas Cocco
                                                  Chief Executive Officer

                                       20
<PAGE>

                                    EXHIBIT A

                              NOTICE OF CONVERSION
                    (To be Executed by the Registered Holder
                         in order to Convert the Notes)

                  The   undersigned   hereby   irrevocably   elects  to  convert
$__________  principal  amount of the Note (defined below) into shares of common
stock,  par  value  $.00005  per share  ("COMMON  STOCK"),  of Redox  Technology
Corporation, a Delaware corporation (the "BORROWER") according to the conditions
of the  convertible  Notes of the  Borrower  dated as of January  31,  2006 (the
"Notes"),  as of the date written  below.  If securities are to be issued in the
name of a  person  other  than the  undersigned,  the  undersigned  will pay all
transfer  taxes  payable with respect  thereto and is  delivering  herewith such
certificates.  No fee will be charged to the Holder for any  conversion,  except
for transfer  taxes, if any. A copy of each Note is attached hereto (or evidence
of loss, theft or destruction thereof).

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

         Name of DTC Prime Broker:______________________________________________
         Account Number:________________________________________________________

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

         Name:__________________________________________________________________
         Address:_______________________________________________________________

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

                  Date of Conversion:___________________________
                  Applicable Conversion Price:__________________
                  Number of Shares of Common Stock to be Issued Pursuant to
                  Conversion of the Notes:______________
                  Signature:___________________________________
                  Name:________________________________________
                  Address:_____________________________________

                                       21
<PAGE>

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

                                       22THIS WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT
         HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
         EXCEPT AS OTHERWISE SET FORTH HEREIN OR IN A SECURITIES PURCHASE
         AGREEMENT DATED AS OF JANUARY 31, 2006, NEITHER THIS WARRANT NOR ANY OF
         SUCH SHARES MAY BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN
         EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER SAID ACT OR,
         AN OPINION OF COUNSEL, IN FORM, SUBSTANCE AND SCOPE, CUSTOMARY FOR
         OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT REGISTRATION IS
         NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 OR
         REGULATION S UNDER SUCH ACT.

                                                                   Right to
                                                                   Purchase
                                                                   ________
                                                                   Shares of
                                                                   Common
                                                                   Stock, par
                                                                   value $.00005
                                                                   per share

                             STOCK PURCHASE WARRANT

         THIS CERTIFIES THAT, for value received, _____________ or its
registered assigns, is entitled to purchase from REDOX TECHNOLOGY CORPORATION
(A/K/A MIDNIGHT AUTO HOLDINGS CORP.), a Delaware corporation (the "Company"), at
any time or from time to time during the period specified in Paragraph 2 hereof,
________ fully paid and nonassessable shares of the Company's Common Stock, par
value $.00005 per share (the "Common Stock"), at an exercise price per share
equal to $.08 (the "Exercise Price"). The term "Warrant Shares," as used herein,
refers to the shares of Common Stock purchasable hereunder. The Warrant Shares
and the Exercise Price are subject to adjustment as provided in Paragraph 4
hereof. The term "Warrants" means this Warrant and the other warrants issued
pursuant to that certain Securities Purchase Agreement, dated January 31, 2006,
by and among the Company and the Buyers listed on the execution page thereof
(the "Securities Purchase Agreement").

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

         1.       MANNER OF EXERCISE; ISSUANCE OF CERTIFICATES; PAYMENT FOR
SHARES. Subject to the provisions hereof, this Warrant may be exercised by the
holder hereof, in whole or in part, by the surrender of this Warrant, together
with a completed exercise agreement in the form attached hereto (the "Exercise
Agreement"), to the Company during normal business hours on any business day at
the Company's principal executive offices (or such other office or agency of the
Company as it may designate by notice to the holder hereof), and upon (i)
payment to the Company in cash, by certified or official bank check or by wire
transfer for the account of the

<PAGE>

Company of the Exercise Price for the Warrant Shares specified in the Exercise
Agreement or (ii) if the resale of the Warrant Shares by the holder is not then
registered pursuant to an effective registration statement under the Securities
Act of 1933, as amended (the "Securities Act"), delivery to the Company of a
written notice of an election to effect a "Cashless Exercise" (as defined in
Section 11(c) below) for the Warrant Shares specified in the Exercise Agreement.
The Warrant Shares so purchased shall be deemed to be issued to the holder
hereof or such holder's designee, as the record owner of such shares, as of the
close of business on the date on which this Warrant shall have been surrendered,
the completed Exercise Agreement shall have been delivered, and payment shall
have been made for such shares as set forth above. Certificates for the Warrant
Shares so purchased, representing the aggregate number of shares specified in
the Exercise Agreement, shall be delivered to the holder hereof within a
reasonable time, not exceeding five (5) business days, after this Warrant shall
have been so exercised. The certificates so delivered shall be in such
denominations as may be requested by the holder hereof and shall be registered
in the name of such holder or such other name as shall be designated by such
holder. If this Warrant shall have been exercised only in part, then, unless
this Warrant has expired, the Company shall, at its expense, at the time of
delivery of such certificates, deliver to the holder a new Warrant representing
the number of shares with respect to which this Warrant shall not then have been
exercised. In addition to all other available remedies at law or in equity, if
the Company fails to deliver certificates for the Warrant Shares within five (5)
business days after this Warrant is exercised, then the Company shall pay to the
holder in cash a penalty (the "Penalty") equal to 2% of the number of Warrant
Shares that the holder is entitled to multiplied by the Market Price (as
hereinafter defined) for each day that the Company fails to deliver certificates
for the Warrant Shares. For example, if the holder is entitled to 100,000
Warrant Shares and the Market Price is $2.00, then the Company shall pay to the
holder $4,000 for each day that the Company fails to deliver certificates for
the Warrant Shares. The Penalty shall be paid to the holder by the fifth day of
the month following the month in which it has accrued.

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

         2.       PERIOD OF EXERCISE. This Warrant is exercisable at any time or
from time to time on or after the date on which this Warrant is issued and
delivered pursuant to the terms of the

                                     - 2 -
<PAGE>

Securities Purchase Agreement and before 6:00 p.m., New York, New York time on
the fifth (5th) anniversary of the date of issuance (the "Exercise Period").

         3.       CERTAIN AGREEMENTS OF THE COMPANY. The Company hereby
covenants and agrees as follows:

                  (a)      SHARES TO BE FULLY PAID. Subject to the completion of
the Charter Amendment Actions (as such term is defined in the Securities
Purchase Agreement), all Warrant Shares will, upon issuance in accordance with
the terms of this Warrant, be validly issued, fully paid, and nonassessable and
free from all taxes, liens, and charges with respect to the issue thereof.

                  (b)      RESERVATION OF SHARES. Subject to the completion of
the Charter Amendment Actions, during the Exercise Period, the Company shall at
all times have authorized, and reserved for the purpose of issuance upon
exercise of this Warrant, a sufficient number of shares of Common Stock to
provide for the exercise of this Warrant.

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

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

                  (e)      SUCCESSORS AND ASSIGNS. This Warrant will be binding
upon any entity succeeding to the Company by merger, consolidation, or
acquisition of all or substantially all the Company's assets.

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

                                     - 3 -
<PAGE>

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

                  (a)      ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES
UPON ISSUANCE OF COMMON STOCK. Except as otherwise provided in Paragraphs 4(c)
and 4(e) hereof, if and whenever on or after the date of issuance of this
Warrant, the Company issues or sells, or in accordance with Paragraph 4(b)
hereof is deemed to have issued or sold, any shares of Common Stock for no
consideration or for a consideration per share (before deduction of reasonable
expenses or commissions or underwriting discounts or allowances in connection
therewith) less than the Market Price on the date of issuance (a "Dilutive
Issuance"), then immediately upon the Dilutive Issuance, the Exercise Price will
be reduced to a price determined by multiplying the Exercise Price in effect
immediately prior to the Dilutive Issuance by a fraction, (i) the numerator of
which is an amount equal to the sum of (x) the number of shares of Common Stock
actually outstanding immediately prior to the Dilutive Issuance, plus (y) the
quotient of the aggregate consideration, calculated as set forth in Paragraph
4(b) hereof, received by the Company upon such Dilutive Issuance divided by the
Market Price in effect immediately prior to the Dilutive Issuance, and (ii) the
denominator of which is the total number of shares of Common Stock Deemed
Outstanding (as defined below) immediately after the Dilutive Issuance.

                  (b)      EFFECT ON EXERCISE PRICE OF CERTAIN EVENTS. For
purposes of determining the adjusted Exercise Price under Paragraph 4(a) hereof,
the following will be applicable:

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

                           (ii)     ISSUANCE OF CONVERTIBLE SECURITIES. If the
Company in any manner issues or sells any Convertible Securities, whether or not
immediately convertible (other than where the same are issuable upon the
exercise of Options) and the price per share for which

                                     - 4 -
<PAGE>

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

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

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

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

                                     - 5 -
<PAGE>

therefor will be deemed to be the fair value of such portion of the net assets
and business of the non-surviving corporation as is attributable to such Common
Stock, Options or Convertible Securities, as the case may be. The fair value of
any consideration other than cash or securities will be determined in good faith
by the Board of Directors of the Company.

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

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

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

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

                                     - 6 -
<PAGE>

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

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

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

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

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

                  (j)      OTHER NOTICES. In case at any time:

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

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

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

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

                                     - 7 -
<PAGE>

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

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

                  (l)      CERTAIN DEFINITIONS.

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

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

                           (iii)    "COMMON STOCK," for purposes of this
Paragraph 4, includes the Common Stock, par value $.00005 per share, and any
additional class of stock of the Company

                                     - 8 -
<PAGE>

having no preference as to dividends or distributions on liquidation, provided
that the shares purchasable pursuant to this Warrant shall include only shares
of Common Stock, par value $.00005 per share, in respect of which this Warrant
is exercisable, or shares resulting from any subdivision or combination of such
Common Stock, or in the case of any reorganization, reclassification,
consolidation, merger, or sale of the character referred to in Paragraph 4(e)
hereof, the stock or other securities or property provided for in such
Paragraph.

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

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

         7.       TRANSFER, EXCHANGE, AND REPLACEMENT OF WARRANT.

                  (a)      RESTRICTION ON TRANSFER. This Warrant and the rights
granted to the holder hereof are transferable, in whole or in part, upon
surrender of this Warrant, together with a properly executed assignment in the
form attached hereto, at the office or agency of the Company referred to in
Paragraph 7(e) below, provided, however, that any transfer or assignment shall
be subject to the conditions set forth in Paragraph 7(f) hereof and to the
applicable provisions of the Securities Purchase Agreement. Until due
presentment for registration of transfer on the books of the Company, the
Company may treat the registered holder hereof as the owner and holder hereof
for all purposes, and the Company shall not be affected by any notice to the
contrary. Notwithstanding anything to the contrary contained herein, the
registration rights described in Paragraph 8 are assignable only in accordance
with the provisions of that certain Registration Rights Agreement, dated January
31, 2006, by and among the Company and the other signatories thereto (the
"Registration Rights Agreement").

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

                  (c)      REPLACEMENT OF WARRANT. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction, or
mutilation of this Warrant and, in the case of any such loss, theft, or
destruction, upon delivery of an indemnity agreement reasonably satisfactory in
form and amount to the Company, or, in the case of any such mutilation, upon
surrender and cancellation of this Warrant, the Company, at its expense, will
execute and deliver, in lieu thereof, a new Warrant of like tenor.

                                     - 9 -
<PAGE>

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

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

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

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

         9.       NOTICES. All notices, requests, and other communications
required or permitted to be given or delivered hereunder to the holder of this
Warrant shall be in writing, and shall be personally delivered, or shall be sent
by certified or registered mail or by recognized overnight mail courier, postage
prepaid and addressed, to such holder at the address shown for such holder on
the books of the Company, or at such other address as shall have been furnished
to the Company by notice from such holder. All notices, requests, and other
communications required or permitted to be given or delivered hereunder to the
Company shall be in writing, and shall be personally delivered, or shall be sent
by certified or registered mail or by recognized overnight mail courier, postage
prepaid and addressed, to the office of the Company at 3872 Rochester Road,
Troy, MI 48083, Attention: Chief Executive Officer, or at such other address as
shall have been furnished to the holder of this Warrant by notice from the
Company. Any such notice, request, or other communication may be sent by
facsimile, but shall in such case be subsequently confirmed by a writing
personally delivered or sent by certified or registered mail or by recognized
overnight mail courier as provided above. All notices, requests, and other
communications shall be deemed to have been given either at the time of the
receipt thereof by

                                     - 10 -
<PAGE>

the person entitled to receive such notice at the address of such person for
purposes of this Paragraph 9, or, if mailed by registered or certified mail or
with a recognized overnight mail courier upon deposit with the United States
Post Office or such overnight mail courier, if postage is prepaid and the
mailing is properly addressed, as the case may be.

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

         11.      MISCELLANEOUS.

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

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

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

                                     - 11 -
<PAGE>

example, if the holder is exercising 100,000 Warrants with a per Warrant
exercise price of $0.75 per share through a cashless exercise when the Common
Stock's current Market Price per share is $2.00 per share, then upon such
Cashless Exercise the holder will receive 62,500 shares of Common Stock.

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

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                     - 12 -
<PAGE>

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

                                             REDOX TECHNOLOGY CORPORATION

                                             By: _______________________________
                                                  Nicholas Cocco
                                                  Chief Executive Officer

Dated as of January 31, 2006

<PAGE>

                           FORM OF EXERCISE AGREEMENT

                                                        Dated: ________ __, 200_

To:      ______________________

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

                                        Name:
                                                --------------------------------

                                        Signature:
                                        Address:
                                                --------------------------------

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

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

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

<PAGE>

                               FORM OF ASSIGNMENT

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

NAME OF ASSIGNEE                ADDRESS                            NO OF SHARES

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

Dated:   ________ __, 200_

In the presence of:
                                            ------------------------------------

                                     Name:
                                            ------------------------------------

                                     Signature:
                                               ---------------------------------
                                                   Title of Signing Officer
                                                       or Agent (if any):

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

                                      Address: ---------------------------------

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

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

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}]]