Document:

PROMISSORY NOTE

$500,000.00                                                      January 5, 2005

                  FOR VALUE RECEIVED, XRG, INC. ("Maker") promises to pay to the
order of KENNETH A. STEEL, JR. or his assign ("Payee"), at his address, 1856
North Howe Street, Chicago, Illinois 60614, the principal sum of FIVE HUNDRED
THOUSAND DOLLARS ($500,000.00), together with interest thereon at the rate of
eighteen (18%) per annum (or, if less, the maximum rate permitted by law) from
the date hereof until all paid; provided, however, if the entire principal and
accrued interest under this Promissory Note is not paid in full by the earlier
to occur of (i) February 5, 2005 or (ii) the date Maker closes its next round of
equity or debt financing, the rate of interest payable under this Promissory
Note shall be twenty-four (24%) per annum (or, if less, the maximum rate
permitted by law).

                  The entire unpaid principal and accrued interest under this
Promissory Note shall be due and payable in full upon the earlier to occur of
(i) February 5, 2005 or (ii) the date Maker closes its next round of equity or
debt financing.

                  In addition, to paying Payee the entire unpaid principal and
accrued interest under this Promissory Note:

                           (a) Maker agrees to issue to Payee not later than
         January 15, 2005 a warrant for 60,000 shares of Maker's Common Stock at
         an exercise price of $2.40 per share; and

                           (b) If the entire unpaid principal and accrued
         interest under this Promissory Note are not paid in full by the earlier
         to occur of (i) February 5, 2005 or (ii) the date Maker closes its next
         round of equity or debt financing, Maker agrees to issue to Payee on
         February 6, 2005 and on the 6th day of each month thereafter until the
         entire unpaid principal and accrued interest under this Promissory Note
         are not paid in full (1) 20,000 shares of Maker's Common Stock and (2)
         a warrant for 60,000 shares of Maker's Common Stock at an exercise
         price of $2.40 per share.

By way of example of the intended operation of clauses (a) and (b) above, if the
entire unpaid principal and accrued interest under this Promissory Note is not
paid in full until April 7, 2005, Maker will issue Payee four warrants, each for
60,000 shares of Maker's Common Stock at an exercise price of $2.40 per share,
and 60,000 shares of Maker's Common Stock. All warrants shall expire (A) on
February 5, 2010, if the entire unpaid principal and accrued interest under this
Promissory Note are not paid in full by the earlier to occur of (i) February 5,
2005 or (ii) the date Maker closes its next round of equity or debt financing,
or (B) on February 5, 2015, if the entire unpaid principal and accrued interest
under this Promissory Note are not paid in full by the earlier to occur of (i)
February 5, 2005 or (ii) the date Maker closes its next round of equity or debt
financing. All warrants shall include cashless exercises provisions,
antidilution and adjustment provisions equivalent to the most favorable (to the
warrant holder) antidilution and adjustment provisions in Maker's currently
outstanding warrants, and otherwise be in form and substance satisfactory to
Payee. Payee shall be granted demand registration rights for all shares of
Maker's Common Stock issued to Payee either directly or through exercise of the

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warrants, which registration rights shall be equivalent to the most favorable
(to the security holder) heretofore granted by Maker. The number of shares and
exercise prices specified shall be appropriately adjusted to reflect any stock
splits, stock dividends, recapitalizations, reorganizations and other similar
transaction affecting the outstanding shares of Maker's Common Stock after the
date hereof. Maker agrees to execute and deliver all such further agreements and
documents, take all such further actions, and do all such further things as
Payee may from time to time reasonably request to carry out the purpose and
intent of this paragraph.

                  Maker agrees that the obligations of Maker under this
Promissory Note shall be secured by a first lien and security interest in all of
the vehicle license plates, operating permits, equipment, and accounts
receivable of XRG, Inc and its subsidiaries, and, in the event Maker fails to
perform any of its obligations under this Promissory Note, Payee may exercise
any and all rights of a secured party with respect thereto. Maker agrees to
execute and deliver all such further agreements and documents, take all such
further actions, and do all such further things, and cause its subsidiaries to
execute and deliver all such further agreements and documents, take all such
further actions, and do all such further things, as Payee may from time to time
reasonably request to carry out the purpose and intent of this paragraph.

                  This Promissory Note shall, at the option of Payee, become
immediately due and payable, upon demand, upon the happening of any one of the
following specified events:

                           (a) Maker fails to timely perform any obligation
         under this Promissory Note;

                           (b) the insolvency of Maker or any of its
         subsidiaries (insolvency being defined herein as the inability to pay
         liabilities at normal maturity, or an excess of total liabilities over
         total assets, or both);

                           (c) the making of a general assignment for the
         benefit of creditors by Maker or any of its subsidiaries;

                           (d) the filing of any petition or the commencement of
         any proceeding by or against the Maker or any of its subsidiaries for
         any relief under any bankruptcy, or insolvency laws or any laws related
         to the relief of debtors, readjustment of indebtedness,
         reorganizations, composition or extensions;

                           (e) the appointment of a receiver of, or the issuance
         or making of a writ or order of attachment or garnishment against,
         Maker or any of its subsidiaries or any of their respective property or
         assets, or

                           (f) The cessation or suspension of the transaction of
         the usual business of Maker or any of its subsidiaries.

                  Maker hereby waive presentment for payment, notice of
nonpayment and dishonor, protest and notice of protest; waive trial by jury in
any action or proceedings arising on, out of, under or by reason of this

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Promissory Note; consent to any renewals, extensions and partial payments of
this Promissory Note or the indebtedness for which it is given without notice to
them, and consent that no such renewals, extensions or partial payments or
release or modification of any collateral securing this Promissory Note or the
indebtedness for which it is given, shall discharge any party hereto from
liability hereon in whole or in part. This Promissory Note may not be changed or
terminated orally.

                  If this Promissory Note is not paid in full when due or Maker
otherwise fails to timely perform any obligation under this Promissory Note,
Maker agree to pay all costs and expenses of Payee in enforcing this Promissory
Note, including all attorneys' and experts' fees.

                  The rights and remedies of Payee under this Promissory Note
shall be deemed cumulative, and the exercise of any right or remedy shall not be
regarded as barring the exercise of any other right or remedy. The institution
by Payee of any action under or with respect to this Promissory Note shall not
be deemed a waiver of any other right or action of Payee.

                  Neither the acceptance of any installment or payment by Payee
after the due date hereof, nor the waiver of any breach or default under this
Promissory Note, shall constitute a waiver or prevent Payee from immediately
pursuing any or all of its rights and remedies hereunder.

                  Failure at any time to exercise any of the rights and remedies
of Payee hereunder shall not constitute a waiver of such rights and shall not be
a bar to exercise of any of such rights at a later date.

                  Maker shall have the privilege to prepay the principal of this
Promissory Note at any time, in whole or in part, with interest, and without
penalty. No such prepayment shall relieve or release Maker of its obligations to
issue shares of its Common Stock or warrants to Payee as contemplated hereby.

                  IN WITNESS WHEREOF, the undersigned has caused this Promissory
Note to be duly executed as of the date first written below.

Dated: January 5, 2005                               XRG, INC.

                                                     By:
                                                         -----------------------
                                                     Its Chief Executive Officer

                                       3

MTC/ej/339287PROMISSORY NOTE MODIFICATION AGREEMENT
                                  FOR EXTENSION

     THIS  INSTRUMENT is entered as of the ___ day of  __________,  2005, by and
between XRG, Inc., a Delaware corporation ("Borrower") and KENNETH A.STEELE, JR.
or registered assigns ("Lender").

                                   WITNESSETH:

         WHEREAS, the Lender is the holder of a certain 18% Note on Borrower,
originally dated January 5, 2005 in the face amount of $500,000.00 ("Note"); and

         WHEREAS, said Note provides that the entire outstanding principal
balance of the indebtedness evidenced thereby shall be due and payable on or
before February 5, 2005; and

         WHEREAS, Borrower has requested that the time of payment for the
principal indebtedness and unpaid accrued interest be extended until March 31,
2005; and

         WHEREAS, Lender has agreed to extend the time of payment of the
principal indebtedness upon the terms and conditions hereinafter set forth.

         NOW, THEREFORE, in consideration of ten dollars ($10.00) paid by
Borrower and other good and valuable consideration, receipt of which is
acknowledged by Lender, the parties agree as follows:

         1. Recitals. The above recitals are true and correct and are
incorporated herein by reference.

         2. Extension of Time of Payment. The time of payment of the principal
indebtedness evidenced by the Note, together with any unpaid accrued interest is
hereby extended until March 31, 2005, at which time all unpaid principal,
together with any unpaid interest accrued thereon, if any, shall be due and
payable in full. The parties acknowledge that the current outstanding principal
balance of the Note is $500,000.

         3. Interest. Interest on the original Note shall be paid at the rate of
eighteen percent (18%) per annum, subject to the default rate interest provision
as set forth in the Note, which remains in full force and effect.

         4. Miscellaneous.

                  (a) Except as specifically modified hereby, all terms of the
Note, as modified, are ratified and confirmed.

                  (b) Borrower acknowledges that said Note, as modified, is in
full force and effect and is binding upon Borrower, its successors and assigns
without any right or claim of offset or other sum due. Lender expressly reserves
all rights against Borrower.

<PAGE>

         IN WITNESS WHEREOF, the undersigned have signed this Agreement as of
the date and year first written above.

                         XRG, INC.

                         By:
                            --------------------------------------------------
                         Print Name:
                                    ------------------------------------------
                         Title:
                               -----------------------------------------------

                         KENNETH A. STEELE, JR.

                         By:
                            --------------------------------------------------

                         Print Name:
                                    ------------------------------------------

                         Title:
                               -----------------------------------------------

MTC/cam/339337v1
2/23/2005 9:51 AM

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