Document:

Exhibit 10.1

 

EMPLOYMENT
AGREEMENT

 

Coreen Sawdon

 

                                                THIS
AGREEMENT is made and entered into as of the 16th  day of October, 2007, by and between Shuffle
Master, Inc., a Minnesota corporation (the “Company”), and Coreen Sawdon
(the “Employee”), a resident of the State of Nevada.

 

RECITALS:

 

                                                A.                                   The Company is
in the business of developing, manufacturing, distributing and otherwise
commercializing gaming equipment, games (live, electronic and simulated),
operating systems for gaming equipment, and related products and services
throughout the United States and in Canada and other countries (the “Business”).

 

                                                B.                                     Company and
Employee want to create an at-will employment relationship that protects the
Company with appropriate confidentiality and non-compete covenants, and
compensates the Employee for performing her obligations appropriately.

 

                                                C.                                     The Company and
Employee desire that Employee be employed by the Company on the terms and
conditions of this Agreement.

 

AGREEMENT

 

                                                In
consideration of the mutual promises contained herein, Employee and the Company
agree as follows:

 

1.                                       Employment.  The Company hereby employs Employee as its
Senior Vice President — Finance and Chief Accountant reporting to the Chief
Financial Officer of the Company and indirectly to the Chair of the Board of
Director’s Audit Committee.  Employee
shall perform the normal duties of that position and as otherwise directed as
contained in Exhibit A.  Employee’s
employment under this Agreement with the Company is for a term of two (2) years
(the “Term”), beginning on August 1, 2007 (the “Commencement Date”),
through July 31, 2009.

 

2.                                       Salary,
Bonus and Benefits.

 

a.               From the Commencement Date
through July 31, 2008, and retroactively to February 18, 2007,
Employee shall be paid an annual base salary of Two Hundred Thousand Dollars
($200,000.00), for the period January 1, 2007 through February 17,
2007, Employee shall be paid an annual base salary of One Hundred Seventy-Seven
Thousand Six Hundred Seventy Five Dollars ($177,675.00) paid in the same
intervals as other Employees of the Company; and if employed through October 31,
2007, Employee will be eligible to receive an executive bonus in accordance
with the terms and conditions of the executive bonus program and/or the
individual performance bonus program authorized by the Board of Directors of
the Company (the “Board”) for other comparable senior vice president-level
employees of the Company for fiscal year 2007, 

 

1

 

with a bonus in a range of percentages, but with a target bonus of 40%
of Employee’s base salary.

 

b.              During the second fiscal
year of this Agreement, Employee will receive an annualized base salary of no
less than Two Hundred Thousand Dollars ($200,000), and will also be eligible to
participate in an executive bonus program and/or in an individual performance
bonus program that applies to other comparable senior vice-president level
employees of the Company as authorized by the Board, up to a target bonus of
45% of Employee’s base salary.  Employee
will not, however, be eligible to participate in the Company’s non-executive
bonus program.  Employee acknowledges
receipt of any bonuses or incentives applicable to fiscal years 2005 and 2006
and any equity grants promised to Employee in her Letter Agreement with the
Company, dated June 17, 2005. 
Employee also acknowledges receipt of 5,000 restricted shares on July 17,
2007, in anticipation of this Agreement.

 

c.               Any stock options or
restricted stock units granted at any time to Employee shall vest in accordance
with the terms and conditions set forth in the applicable grant by the Board
and, as otherwise may be applicable, with any relevant terms and conditions of
the 2004 Equity Incentive Plan as amended (the “Plan”).  Employee acknowledges that any option grants
are at the sole discretion of the Board.

 

d.              Employee’s salary is set in
the expectation that (except for vacation days and holidays) Employee’s full
time will be devoted to Employee’s duties hereunder.

 

e.               During Employee’s employment
with the Company, the Company will promptly pay or reimburse Employee for
reasonable travel, entertainment and other expenses incurred by Employee in the
furtherance of or in connection with the performance of Employee’s duties.  Such reimbursement will be in accordance with
Company policies in existence from time to time.

 

f.                 For as long as the Company
makes the following benefits available to any comparable senior vice
president-level employees of the Company, Company agrees to provide Employee
with:

 

i.                  Club Sport
Family membership;

ii.               Premiere Care
medical services.

 

g.              Notwithstanding any other
provision contained herein, Employee shall be and is an employee “at will,”
terminable at any time, with or without just cause or notice.

 

3.                                       Outside
Services or Consulting. 
Employee shall devote Employee’s full professional time and best
professional efforts to the Company. 
Employee may render other professional or consulting services to other
persons or businesses from time to time during the Term, only if Employee meets
all of the following requirements:

 

a.               The services do not
interfere in any manner with the Employee’s ability to fulfill all of her
duties and obligations to the Company.

 

2

 

b.              The services are not
rendered to any business that may compete with the Company in any area of the
Business or do not otherwise violate paragraph 4 hereof.

 

c.               The services do not relate
to any products or services, which form part of the Business.

 

d.              Employee informs and obtains
the consent of the Chief Executive Officer of the Company.

 

4.                                       Non-competition.  In consideration of the provisions of this
Agreement, Employee hereby agrees that she shall not, during the term of her
full-time employment and for a period of twelve (12) months thereafter:

 

a.               Directly or indirectly own,
manage, operate, participate in, consult with or work for any business, which
is engaged in the Business anywhere in the United States or Canada.

 

b.              Either alone or in
conjunction with any other person, partnership or business, directly or
indirectly, solicit, hire, or divert or attempt to solicit, hire or divert any
of the Employees, independent contractors, or agents of the Company (or its
affiliates or successors) to work for or represent any competitor of the
Company (or its affiliates or successors), or to call upon any of the customers
of the Company (or its affiliates or successors).

 

c.               Directly or indirectly
provide any services to any person, company or entity, which is engaged in the Business
anywhere in the United States or Canada.

 

5.                                       Confidentiality;
Inventions.

 

a.               Employee shall fully and
promptly disclose to the Company all inventions, discoveries, software and
writings that Employee may make, conceive, discover, develop or reduce to
practice either solely or jointly with others during Employee’s employment with
the Company, whether or not during usual work hours.  Employee agrees that all such inventions,
discoveries, software and writing shall be and remain the sole and exclusive
property of the Company, and Employee hereby agrees to assign, and hereby
assigns all of Employee’s right, title and interest in and to any such
inventions, discoveries, software and writings to the Company.  Employee agrees to keep complete records of such
inventions, discoveries, software and writings, which records shall be and
remain the sole property of the Company, and to execute and deliver, either
during or after Employee’s employment with the Company, such documents as the
Company shall deem necessary or desirable to obtain such letters patent,
utility models, inventor’s certificates, copyrights, trademarks or other
appropriate legal rights of the United States and foreign countries as the
Company may, in its sole discretion, elect, and to vest title thereto in the
Company, its successors, assigns, or nominees.

 

b.              “Inventions,” as used
herein, shall include inventions, discoveries, improvements, ideas and
conceptions, developments and designs, whether or not patentable, tested,
reduced to practice, subject to copyright or other rights or forms of
protection, or relating to data processing, communications, computer software
systems, programs and procedures.

 

3

 

c.               Employee understands that
all copyrightable work that Employee may create while employed by the Company
is a “work made for hire,” and that the Company is the owner of the copyright
therein.  Employee hereby assigns all
right, title and interest to the copyright therein to the Company.

 

d.              Employee has no inventions,
improvements, discoveries, software or writings useful to the Company or its
subsidiaries or affiliates in the normal course of business, which were
conceived, made or written prior to the date of this Agreement.

 

e.               Employee will not publish or
otherwise disclose, either during or after Employee’s employment with the
Company, any published or proprietary or confidential information or secret
relating to the Company, the Business, the Company’s operations or the Company’s
products or services.  Employee will not
publish or otherwise disclose proprietary or confidential information of others
to which Employee has had access or obtained knowledge in the course of
Employee’s employment with the Company. 
Upon termination of Employee’s employment with the Company, Employee
will not, without the prior written consent of the Company, retain or take with
Employee any drawing, writing or other record in any form or nature which
relates to any of the foregoing.

 

f.                 Employee understands that Employee’s
employment with the Company creates a relationship of trust and confidence
between Employee and the Company. 
Employee understands that Employee may encounter information in the
performance of Employee’s duties that is confidential to the Company or its
customers.  For the Term hereof, and
until the information falls into the public domain, Employee agrees to maintain
in confidence all information pertaining to the Business or the Company to
which Employee has access including, but not limited to, information relating
to the Company’s products, inventions, trade secrets, know how, systems,
formulas, processes, compositions, customer information and lists, research
projects, data processing and computer software techniques, programs and
systems, costs, sales volume or strategy, pricing, profitability, plans,
marketing strategy, expansion or acquisition or divestiture plans or strategy
and information of similar nature received from others with whom the Company
does business.  Employee agrees not to use,
communicate or disclose or authorize any other person to use, communicate or
disclose such information orally, in writing, or by publication, either during
Employee’s employment with the Company or thereafter except as expressly
authorized in writing by the Company unless and until such information becomes
generally known in the relevant trade to which it relates without fault on
Employee’s part, or as required by law.

 

6.                                       Termination
or Non-Extension by Company Without Just Cause

 

a.               Employee’s employment by the
Company is “at will” therefore, subject to the terms and conditions hereof, the
Company may terminate Employee’s full-time employment at any time either with
or without just cause. In the event of any termination of Employee’s full-time
employment with the Company without just cause, or in the event that Employee’s
full-time employment is not extended or renewed beyond the Term on terms at
least as favorable to Employee as Employee is receiving during the last year of
the Term, then Employee will remain bound to the covenants not to compete and 

 

4

 

confidentiality obligations
of paragraphs 4 and 5 of this Agreement, according to their terms, and each one
of the following shall apply:

 

i.                                          Employee shall
be paid an amount equal to one-half of her then annual base salary, paid over a
period of twelve (12) months from Employee’s termination, in equal monthly
installments and at the same intervals as other Employees of the Company are
then being paid their base salaries;

 

ii.                                       Employee shall
continue to receive, during the twelve (12) months from Employee’s termination,
all medical insurance and any other benefits (except for the benefit in
paragraph 2(f)(i)) or insurance coverages which Employee would have received
had her employment not been so terminated, or not extended, provided however,
if the Employee is not eligible for said medical insurance, the Company shall
pay the COBRA premiums for continuation coverage during the said twelve (12)
month period;

 

iii.                                    Employee shall
receive additional compensation for her covenant not to compete equal to the
average annual bonus which Employee has received for the three most recent
fiscal years during which Employee was employed, provided however that if
Employee has not been employed for three full fiscal years, then the Company
shall use the actual number of full fiscal years that the Employee was
employed; and if the Employee has not been employed for a full fiscal year,
than the Company shall use the bonus amount, if any, paid to Employee (but
annualized for a full fiscal year) from the most recent partial  fiscal year for which the Employee was
entitled to a bonus under this Agreement, and the amount due under this paragraph
6(a)(iii) shall be paid in the same intervals as other Employees of the
Company are then being paid their base salaries;

 

iv.                                   Notwithstanding
anything else contained herein to the contrary, during the 12-month period
referred to in this paragraph 6, Employee shall remain a part-time employee of
the Company’s and, subject to Employee’s other professional duties, shall be
available to the Chief Financial Officer of the Company.

 

b.              For purposes hereof, any of
the following acts or events shall, at Employee’s option, constitute a
termination without just cause under this paragraph 6 (but the following is not
the entire list of reasons or events which may constitute a “termination
without just cause”):

 

i.                                          any material
diminution or reduction of Employee’s title, position, duties or responsibilities,
except as caused by the acts or omissions of Employee; or

 

ii.                                       any material
breach by Company of this Agreement that is not cured within thirty (30)
days  after written notice by Employee of
such breach.

 

c.               In the event that, at the
end of the Term, the Company elects not to extend or renew Employee’s full-time
employment beyond the Term on terms at least favorably to Employee as Employee
is receiving during the last fiscal year of the Term, then such non-renewal
shall be treated as a termination without cause.  In such case, the provisions of paragraphs
6(a)(i) through (iv) shall apply and Employee shall be bound to the 

 

5

 

provisions of paragraphs 4
and 5 hereof for the period of time during which Employee is being paid
pursuant to paragraph 6(a).

 

7.                                       Early
Termination by Company for Just Cause.  The Company may terminate Employee for just
cause.  In the event the Company
terminates the Employee for just cause, the Employee will remain bound under
the provisions of paragraphs 4 and 5, but will not be entitled to any
compensation or benefits following her termination of employment under this
Agreement.  Termination for “just cause”
shall mean any of the following (and none of the following shall be interpreted
as cumulative):

 

a.               dishonesty as to a matter
which is materially injurious to the Company;

 

b.              the commission of a willful
act or omission intended or likely to materially injure the business of the
Company;

 

c.               a violation of any of the
material provisions of Sections 4 and/or 5 hereof;

 

d.              a determination in good
faith by the CFO or the Board that the Employee has failed to make a good faith
effort to fully perform her duties as assigned by either the CFO or the Board,
which is not remedied by the Employee within fifteen (15) days following the
CFO’s or the Board’s written notice stating such alleged failure;

 

e.               the
Employee is repeatedly inattentive to her duties pursuant to this Agreement and has received written notice of same and, if curable, has
failed to so cure within 15 days of such
written notice;

 

f.                 the Employee fails or is
unable to become licensed in any jurisdiction where licensing is required, or
once licensed, any loss or suspension thereof;

 

8.                                       Voluntary
Termination by Employee.

 

a.               In the event Employee
voluntarily terminates her employment with the Company, Employee will remain
bound under the provisions of paragraphs 4 and 5 hereof, but will not be
entitled to receive any compensation and benefits following her termination of
employment except for any payments or benefits required by law.

 

b.              Voluntary termination means
an intentional termination by the Employee without good reason and without
pressure by the Company; and further, provided that there was not a material
breach of this Agreement by the Company, prior to any such termination which
remains uncured.

 

9.                                       Cooperation
with Change in Control. 
Employee will reasonably cooperate with the Company in the event of a
Change in Control.

 

10.                                 No
Conflicting Agreements. 
Employee has the right to enter into this Agreement, and hereby confirms
Employee has no contractual or other impediments to the performance of Employee’s
obligations including, without limitation, any non-competition or similar
agreement in favor of any other person or entity.

 

6

 

11.                                 Company
Policies.  During the
term of Employee’s employment, Employee shall engage in no activity or
employment which may conflict with the interest of the Company, and Employee
shall comply with all policies and procedures of the Company including, without
limitation, all policies and procedures pertaining to ethics.

 

12.                                 Independent
Covenants.  The
covenants and agreements on the part of the Employee contained in paragraphs 4
and 5 hereof shall be construed as agreements independent of any other
provision in this Agreement; thus, it is agreed that the relief for any claim
or cause of action of the Employee against the Company, whether predicated on
this Agreement or otherwise, shall be measured in damages and shall not
constitute a defense or bar to enforcement by the Company of those covenants
and agreements.

 

13.                                 Injunctive
Relief; Attorneys’ Fees.  In
recognition of the irreparable harm that a violation by Employee of any of the
covenants contained in either paragraphs 4 or 5 hereof would cause the Company,
the Employee agrees that, in addition to any other relief afforded by law, an
injunction (both temporary and permanent) against such violation or violations
may be issued against him or her and every other person and entity concerned
thereby, it being the understanding of the parties that both damages and an
injunction shall be proper modes of relief and are not to be considered
alternative remedies.  Employee consents
to the issuance of such injunctive relief without the posting of a bond or
other security.  In the event of any such
alleged violation, THE LOSING PARTY AGREES TO PAY THE COSTS, EXPENSES AND
REASONABLE ATTORNEYS’ FEES INCURRED BY THE PREVAILING PARTY IN PURSUING OR
DEFENDING ANY OF ITS RIGHTS WITH RESPECT TO SUCH ALLEGED VIOLATIONS, IN
ADDITION TO THE ACTUAL DAMAGES SUSTAINED BY THE PREVAILING PARTY AS A RESULT
THEREOF.

 

14.                                 Notice.  Any notice sent by registered mail to the
last known address of the party to whom such notice is to be given shall
satisfy the requirements of notice in this Agreement.

 

15.                                 Entire
Agreement.  This
Agreement is the entire agreement of the parties hereto concerning the subject
matter hereof and supersedes and replaces in its entirety any oral or written
existing agreements or understandings between the Company and the Employee
relating generally to the same subject matter. 
Company and Employee hereby acknowledge that there are no agreements or
understandings of any nature, oral or written, regarding Employee’s employment,
apart from this Agreement, and Employee acknowledges that no promises or
agreements not contained in this Agreement have been made or offered by the
Company.

 

16.                                 Severability.  It is agreed and understood by the parties
hereto that if any provision of this Agreement should be determined by an
arbitrator or court to be unenforceable in whole or in part, it shall be deemed
modified to the minimum extent necessary to make it reasonable and enforceable
under the circumstances, and the court shall be authorized by the parties to
reform this Agreement in the least way necessary in order to make it reasonable
and enforceable.

 

17.                                 Governing
Law.  This Agreement shall be
construed and enforced in accordance with the laws of the State of Nevada,
without giving effect to the principles of conflicts of laws thereof.

 

18.                                 Heirs,
Successors and Assigns.  The
terms, conditions, obligations, agreements and covenants hereof shall extend
to, be binding upon, and inure to the benefit of the parties hereto and 

 

7

 

their
respective heirs, personal representatives, successors, assigns, and/or
acquirers, including any entity which acquires, merges with, or obtain control
of the Company.

 

19.                                 Waiver
of Breach.  The waiver
by either the Company or the Employee of any breach of any provision of this
Agreement shall not operate as or be deemed a waiver of any subsequent breach
by either the Company or the Employee.

 

21.                                 Dispute
Resolution.  Except for the
Company’s right (either pursuant to paragraph 13 hereof or otherwise) to
injunctive relief to enforce the provisions of paragraphs 4 and 5 hereof, the
exclusive forum for the resolution of any dispute arising under this Agreement
or any question of interpretation regarding the provisions of this Agreement
(other than disputes relative to paragraphs 4 or 5 hereof) shall be resolved by
arbitration, to be held in Clark County, Nevada, in accordance with the rules of
the American Arbitration Association. 
Such arbitration shall be before an arbitrator, who must be a member of
the National Academy of Arbitrators; chosen in accordance with the rules then
in effect, of the American Arbitration Association.  In the event the Employee and Company fails
within a reasonable period of time to agree on an arbitrator, the arbitrator
shall be chosen by the American Arbitration Association.  The decision of the arbitrator shall be
final, conclusive and binding upon the Company and Employee.

 

22.                                 Amendment.  This Agreement may be amended only by a
document in writing signed by both the Employee and an officer of the Company,
and no course of dealing or conduct of the Company shall constitute a waiver of
any of the provisions of this Agreement.

 

23.                                 Fees
and Costs.  In any
action bought by one party against the other pursuant to this Agreement or in
the event of any dispute over the meaning of this Agreement, the successful
party, in addition to recovering its awarded damages and other relief, shall be
entitled to recover its attorney’s fees and costs from the unsuccessful party.

 

24.                                 Non-Disparagement
and Cooperation.

 

a.               During any period of time
wherein the Company is paying any base salary to Employee, whether during the
Term hereof or during any time after the termination or expiration of this
Agreement, and for a period of three (3) years thereafter, Employee shall
not disparage or otherwise make any negative comments about the Company, its
policies, products, Employees or management. 
The Company may enforce these non-disparagement provisions by resort to
injunctive relief as set forth in paragraph 13, in addition to any other
damages that it may be entitled to under this Agreement or otherwise at law.

 

b.              Employee agrees to fully
cooperate with the Company and its affiliates during the entire scope and
duration of any litigation or administrative proceedings involving any matters
with which Employee was involved during Employee’s employment with the Company.

 

c.               In the event Employee is
contacted by parties or their legal counsel involved in litigation adverse to
the Company or its affiliates, Employee (i) agrees to provide notice of
such contact as soon as practicable; and (ii) acknowledges that any
communication with or in the presence of legal counsel for the Company
(including without limitation the Company’s outside legal counsel, the Company’s
inside legal counsel, and legal counsel 

 

8

 

of each related or
affiliated entity of the Company) shall be privileged to the extent recognized
by law and, further, will not do anything to waive such privilege unless and
until a court of competent jurisdiction decides that the communication is not
privileged.  In the event the existence
or scope of the privileged communication is subject to legal challenge, then
the Company must either waive the privilege or pursue litigation to protect the
privilege at the Company’s sole expense.

 

25.                                 D &
O Policy.  During
Employee’s employment with the Company under this Agreement, the Company shall
maintain director and officer liability insurance in reasonable scope and
amounts which insurance will cover Employee.

 

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

 

	
  EMPLOYER:

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
  SHUFFLE
  MASTER, INC.

  	
  COREEN
  SAWDON

  
	
   

  	
   

  
	
  By: 

  	
  /s/
  Jerry Smith

  	
   

  	
  By: 

  	
  /s/
  Coreen Sawdon

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Its: 

  	
  Senior
  Vice President & General Counsel.

  	
   

  	
  Its: 

  	
  Senior
  Vice President Finance & Chief Accountant Officer

  	
   

  

 

 

9EXHIBIT 4.2

AMENDED CONVERTIBLE PROMISSORY NOTE

FACE AMOUNT                                                 $1,937,000
PRICE                                                       $1,550,000
INTEREST RATE                                               0% per month
NOTE NUMBER                                                 December - 2006-101
ISSUANCE DATE                                               December 6, 2006
MATURITY DATE                                               July 11, 2008

This Note replaces the Note issued on December 6, 2006. FOR VALUE RECEIVED, On
The Go Healthcare, Inc, a Delaware corporation (the "Company"), (OTC BB: OGOH)
hereby promises to pay DUTCHESS PRIVATE EQUITIES FUND, LTD. as
successor-in-interest to Dutchess Private Equities Fund, L.P. (the "Holder")
within the Maturity Date, or earlier, the Amount of One Million Nine Hundred
and Thirty-Seven Thousand Dollars ($1,937,000) U.S., in such amounts, at such
times and on such terms and conditions as are specified herein, and as may be
amended from time to time (this "Note").  Dutchess and the Company hereby
agree that, as of March 5, 2008, the principal balance on the Note is $632,500
and there is no accrued interest.

Article 1  Payment

Payments made by the Company in satisfaction of this Note (each a "Payment,"
and collectively, the "Payments") to the Holder shall be made monthly on the
tenth (10th) business day of each month, in an amount totaling one hundred
and twenty six thousand five hundred dollars ($126,500) per month ("Payment
Amount"). The Payment Amount will be paid in the Company's common stock
pursuant to a conversion as outlined in Section 1.1, herein, par value
$0.0001 per share (the "Common Stock"), or cash as set forth herein. Failure
to make Payments will constitute an Event of Default under this Note, subject
to opportunity to cure, and the Holder may seek to take actions as described
under Article 4 of this Note.

Notwithstanding any provision to the contrary in this Note, the Company may
pay in full to the Holder the Face Amount, or any balance remaining thereof,
in shares of Common Stock or cash at any time and from time to time without
penalty ("Prepayment").  Prepayments will be applied to the next payment due
on the payment schedule and subsequent payments afterwards.

After the effective date of this Note, if the Company receives in excess of
one million dollars ($1,000,000) in financing, debt or equity, be it from
the Holder or another source, including any sale, disposition or transfer of
assets except in the ordinary course of business, the Company must make a
Prepayment to the Holder when the aggregate amount of financing received by
the Company is in excess of one million dollars ($1,000,000) ("Threshold
Amount"). The calculation of the Threshold Amount will exclude all broker's
fees, commissions, inducement shares of stock or warrants and other expenses
of the financing or sale.  The Company agrees to pay one hundred percent
(100%) of any proceeds raised by the Company over the Threshold Amount
toward the Prepayment of the Note until the Face Amount is paid in full.
The payments shall be made to the Holder upon the Company's receipt of the
financing. Failure to do so will result in an Event of Default.

<PAGE>

Section 1.1 Method of Payment

        (a) Cash.
                a. The Company will pay the Holder, at its sole option, in
                   Common Stock pursuant to a conversion as set forth in
                   Section 1.1 (b), below.  Commencing on the eleventh (11th)
                   of the month until the tenth (10th) of the next month
                   ("Payment Period"), if the amount converted by the Holder
                   has a value less than the Payment Amount, the Company shall
                   immediately pay to the Holder in cash (each, a "Cash
                   Payment") the difference between the amount converted and
                   the Payment Amount on the tenth (10th) day of the month
                   wherein the Payment is due, and subtracting those amounts
                   converted into Common Stock by the Holder for the prior
                   Payment Period.

        (b) Conversion.

                (i)  Payment in satisfaction of the Note will be in shares of
                     Common Stock.  The number of shares of Common Stock
                     issuable upon the conversion of the Note shall be
                     determined pursuant to Section 1.1(e).

                (ii) In the event all or any portion of the Note remains
                     outstanding on the Maturity Date, the Holder shall retain
                     the sole right to request the Residual Amount, as defined
                     in Article 3, to be automatically converted into shares of
                     Common Stock, or due in cash, on such date.

        (c) Conversion Procedure. The Holder will convert into Common Stock the
            unpaid Face Amount of this Note.  Such conversion shall be
            effectuated by surrendering to the Company, or its attorney, the
            Note to be converted together with a facsimile or original of the
            signed notice of conversion (the "Notice of Conversion"). The date
            on which the Notice of Conversion is effective ("Conversion Date")
            shall be deemed to be the date on which the Holder has delivered
            to the Company a facsimile or original of the signed Notice of
            Conversion, as long as the original Note to be converted is
            received by the Company within five (5) business days thereafter.
            At such time that the original Note has been received by the
            Company, the Holder can elect whether a reissuance of the Note is
            warranted, or whether the Company can retain the Note as to a
            continual conversion by the Holder.  Notwithstanding the foregoing,
            if no Notice of Conversion is provided to the Company, the
            Conversion Date shall be deemed to be the date Payment would
            otherwise be due to Holder.

<PAGE>

        (d) Common Stock to be Issued. Upon the conversion of any Payment made
            in satisfaction of the Note, the Company shall instruct its
            transfer agent to issue stock certificates in such denominations
            to be specified at conversion representing the number of shares of
            Common Stock issuable upon such conversion, as applicable. In the
            event that the Common Stock underlying the Note is deemed sellable
            under Rule 144, the Company shall cause its counsel to issue a
            legal opinion to the Company's transfer agent promptly upon any
            such request, so long as the Holder provides the Company's counsel
            with all such information counsel reasonably and customarily
            requests to provide such opinion.  The Company is responsible to
            provide all costs associated with the issuance of the shares,
            including but not limited to the opinion letter, FedEx of the
            certificates and any other costs that arise. The Company shall act
            as registrar and shall maintain an appropriate ledger containing
            the necessary information with respect to the Note. The Company
            warrants that no instructions, other than these instructions, have
            been given or will be given to the transfer agent and that the
            Common Stock shall otherwise be freely resold, except as may be set
            forth herein or subject to applicable law.

        (e) Conversion Rate.  The Company will convert the Note at 80% (eighty
            percent) of the lowest closing best bid price of the Common Stock
            for the ten (10) Trading Days prior to the Conversion Date
            ("Conversion Price"). No fractional shares or scrip representing
            fractions of shares will be issued on conversion, but the number
            of shares issuable shall be rounded up or down, as the case may be,
            to the nearest whole share. Notwithstanding the foregoing, no
            single issuance of Common Stock shall exceed 4.99% of the total
            outstanding common stock of the Company at the time of each
            issuance.

        (f) Nothing contained in the Note shall be deemed to establish or
            require the payment of interest to the Holder at a rate in excess
            of the maximum rate permitted by governing law.  In the event
            that the rate of interest required to be paid exceeds the maximum
            rate permitted by governing law, the rate of interest required to
            be paid there under shall be automatically reduced to the maximum
            rate permitted under the governing law and such excess shall be
            returned with reasonable promptness by the Holder to the Company.

        (g) It shall be the Company's responsibility to take all necessary
            actions and to bear all such costs to issue the Common Stock
            as provided herein, including the responsibility and cost for
            delivery of an opinion letter to the transfer agent, if so
            required.  Holder shall be treated as a shareholder of record
            on the date Common Stock is issued to the Holder. If the Holder
            shall designate another person as the entity in the name of
            which the stock certificates issuable upon conversion of the
            Note are to be issued prior to the issuance of such certificates,
            the Holder shall provide to the Company evidence that either no
            tax shall be due and payable as a result of such transfer or that
            the applicable tax has been paid by the Holder or such person.
            Upon surrender of any Note that is to be converted in part, the
            Company shall issue to the Holder a new Note equal to the
            unconverted amount, if so requested in writing by the Holder.

<PAGE>

        (h) Within three (3) business days after receipt of the documentation
            referred to above in Section 1.1(c), the Company shall deliver a
            certificate, for the number of shares of Common Stock issuable
            upon the conversion. In the event the Company does not make
            delivery of the Common Stock as instructed by Holder within
            three (3) business days after the Conversion Date, then in such
            event the Company shall pay to the Holder one percent(1%) in
            cash of the dollar value of the Face Amount of the Note remaining
            after said conversion, compounded daily, per each day after the
            third (3rd) business day following the Conversion Date that the
            Common Stock is not delivered to the Holder.  The Company
            acknowledges that its failure to deliver the Common Stock within
            five (5) business days after the Conversion Date will cause the
            Holder to suffer damages in an amount that will be difficult to
            ascertain. Accordingly, the parties agree that it is appropriate
            to include in this Note a provision for liquidated damages.  The
            parties acknowledge and agree that the liquidated damages
            provision set forth in this section represents the parties'
            good faith effort to quantify such damages and, as such, agree
            that the form and amount of such liquidated damages are reasonable
            and will not constitute a penalty.  The payment of liquidated
            damages shall not relieve the Company from its obligations to
            deliver the Common Stock pursuant to the terms of this Note.

        (i) The Company shall at all times reserve (or make alternative written
            arrangements for reservation or contribution of shares) and have
            available all Common Stock necessary to meet conversion of the
            Note by the Holder of the entire amount of the Note then
            outstanding. If, at any time the Holder submits a Notice of
            Conversion  or a Conversion Date arises and the Company does not
            have sufficient authorized but unissued shares of Common Stock
            (or alternative shares of Common Stock as may be contributed by
            stockholders of the Company) available to effect, in full, a
            conversion of the Note (a "Conversion Default," the date of such
            default being referred to herein as the "Conversion Default Date"),
            the Company shall issue to the Holder all of the shares of Common
            Stock which are available, and the Notice of Conversion as to any
            portions of the Note requested to be converted but not converted
            (the "Unconverted Note"), may be deemed null and void upon written
            notice sent by the Holder to the Company.  The Company shall
            provide notice of such Conversion Default ("Notice of Conversion
            Default") to the Holder, by facsimile within three (3) business
            days of such default (with the original delivered by overnight
            mail or two day courier), and the Holder shall give notice to the
            Company by facsimile within five (5) business days of receipt of
            the original Notice of Conversion Default (with the original
            delivered by overnight mail or two day courier) of its election
            to either nullify or confirm the Notice of Conversion.

<PAGE>

            The Company agrees to pay the Holder payments for a Conversion
            Default ("Conversion Default Payments") in the amount of (N/365)
            multiplied by 0.24 multiplied by the initial issuance price of
            the outstanding or tendered but Unconverted Note held by the Holder
            where N = the number of days from the Conversion Default Date to
            the date (the "Authorization Date") that the Company authorizes
            a sufficient number of shares of Common Stock to effect conversion
            of all remaining amounts under the Note.  The Company shall send
            notice ("Authorization Notice") to the Holder that additional
            shares of Common Stock have been authorized, the Authorization
            Date, and the amount of Holder's accrued Conversion Default
            Payments.  The accrued Conversion Default shall be paid in cash
            or shall be convertible into Common Stock at the conversion rate
            set forth in the first sentence of this paragraph, upon written
            notice sent by the Holder to the Company, which Conversion Default
            shall be payable as follows:  (i) in the event the Holder elects
            to take such payment in cash, cash payments shall be made to the
            Holder by the fifth (5th) day of the following calendar month, or
            (ii) in the event Holder elects to take such payment in stock, the
            Holder may convert such payment amount into Common Stock at the
            conversion rate set forth in the first sentence of this paragraph
            at any time after the fifth (5th) day of the calendar month
            following the month in which the Authorization Notice was received,
            until the expiration of the mandatory three (3) year conversion
            period.

            The Company acknowledges that its failure to maintain a sufficient
            number of authorized but unissued shares of Common Stock to effect
            in full a conversion of the Note will cause the Holder to suffer
            damages in an amount that will be difficult to ascertain.
            Accordingly, the parties agree that it is appropriate to include
            in this Note a provision for liquidated damages. The parties
            acknowledge and agree that the liquidated damages provision set
            forth in this section represents the parties' good faith effort to
            quantify such damages and, as such, agree that the form and amount
            of such liquidated damages are reasonable and will not constitute
            a penalty. The payment of liquidated damages shall not relieve
            the Company from its obligations to deliver the Common Stock
            pursuant to the terms of this Note.

        (j) If, by the third (3rd) business day after the Conversion Date of
            any portion of the Note to be converted (the "Delivery Date"), the
            transfer agent fails for any reason to deliver the Common Stock
            upon conversion by the Holder and after such Delivery Date, the
            Holder purchases, in an open market transaction or otherwise,
            shares of Common Stock (the "Covering Shares") solely in order to
            make delivery in satisfaction of a sale of Common Stock by the
            Holder (the "Sold Shares"), which delivery such Holder anticipated
            to make using the Common Stock issuable upon conversion
            (a "Buy-In"), the Company shall pay to the Holder, in addition to
            any other amounts due to Holder pursuant to this Note, and not in
            lieu thereof, the Buy-In Adjustment Amount (as defined below).
            The "Buy In Adjustment Amount" is the amount equal to the excess,
            if any, of (x) the Holder's total purchase price (including
            brokerage commissions, if any) for the Covering Shares over (y)
            the net proceeds (after brokerage commissions, if any) received
            by the Holder from the sale of the Sold Shares. The Company shall
            pay the Buy-In Adjustment Amount to the Holder in immediately
            available funds within five (5) business days of written demand
            by the Holder.  By way of illustration and not in limitation of
            the foregoing, if the Holder purchases shares of Common Stock
            having a total purchase price (including brokerage commissions)
            of $11,000 to cover a Buy-In with respect to shares of Common
            Stock it sold for net proceeds of $10,000 the Buy-In Adjustment
            Amount which the Company will be required to pay to the Holder
            will be $1,000.

<PAGE>

        (k) The Company shall defend, protect, indemnify and hold harmless
            the Holder and all of its shareholders, officers, directors,
            employees, counsel, and direct or indirect investors and any of
            the foregoing person's agents or other representatives
            (including, without limitation, those retained in connection
            with the transactions contemplated by this Note) (collectively,
            the "Section 1.1(k)Indemnitees") from and against any and all
            actions, causes of action, suits, claims, losses, costs,
            penalties, fees, liabilities and damages, and expenses in
            connection therewith (irrespective of whether any such
            Section 1.1(k) Indemnitee is a party to the action for which
            indemnification hereunder is sought), and including reasonable
            attorneys' fees and disbursements (the "Section 1.1(k)
            Indemnified Liabilities"), incurred by any Section 1.1(k)
            Indemnitee as a result of, or arising out of, or relating to
            (i) any misrepresentation or breach of any representation or
            warranty made by the Company in this Note or any other certificate,
            instrument or document contemplated hereby or thereby, (ii) any
            breach of any covenant, agreement, or obligation of the Company
            contained in this Note or any other certificate, instrument, or
            document contemplated hereby or thereby, (iii) any cause of action,
            suit, or claim brought or made against such Section 1.1(k)
            Indemnitee by a third party and arising out of or resulting from
            the execution, delivery, performance, or enforcement of this Note
            or any other certificate, instrument, or document contemplated
            hereby or thereby, (iv) any transaction financed or to be financed
            in whole or in part, directly or indirectly, with the proceeds of
            the issuance of the Common Stock underlying the Note
            ("Securities"), or (v) the status of the Holder or holder of the
            Securities as an investor in the Company, except insofar as any
            such  misrepresentation, breach or any untrue statement, alleged
            untrue statement, omission, or alleged omission is made in
            reliance upon and in conformity with written information furnished
            to the Company by the Holder or the investor which is
            specifically intended by the Holder or the investor to be
            relied upon by the Company, including for use in the preparation
            of any such registration statement, preliminary prospectus,  or
            prospectus, or is based on illegal trading of the Common Stock
            by the Holder or the investor. To the extent that the foregoing
            undertaking by the Company may be unenforceable for any reason,
            the Company shall make the maximum contribution to the payment
            and satisfaction of each of the Indemnified Liabilities that is
            permissible under applicable law. The indemnity provisions
            contained herein shall be in addition to any cause of action
            or similar rights the Holder may have, and any liabilities the
            Holder may be subject to.

Article 2  RESERVED

Article 3  Unpaid Amounts

In the event that on the Maturity Date the Company has any remaining amounts
unpaid on this Note (the "Residual Amount"), the Holder can exercise its right
to increase the Face Amount by ten percent (10%) as an initial penalty and two
and one-half percent (2.5%) of the Face Amount per month paid as liquidated
damages ("Liquidated Damages").  The Liquidated Damages will be compounded
daily. If the aforementioned occurs, the Company will be in Default and the
remedies as described in Article 4 may be taken at the Holder's discretion.
It is the intention and acknowledgement of both parties that the Liquidated
Damages not be deemed as interest.

<PAGE>

Article 4  Defaults and Remedies

Section 4.1  Events of Default.

An "Event of Default" or "Default" occurs if any of the following occur:

        (a) the Company does not make the Payment of the Face Amount of this
            Note within three (3) business days of the later of (i) receipt
            of a Notice of Conversion or (ii) a Payment Date; or, a balance
            on the Note exists on the Maturity Date, as applicable, upon
            redemption or otherwise;

        (b) the Company, pursuant to or within the meaning of any Bankruptcy
            Law (as hereinafter defined): (i) commences a voluntary case;
            (ii) consents to the entry of an order for relief against it in
            an involuntary case; (iii) consents to the appointment of a
            Custodian (as hereinafter defined) of it or for all or
            substantially all of its property; (iv) makes a general
            assignment for the benefit of its creditors; or (v) a court
            of  competent jurisdiction enters an order or decree under any
            Bankruptcy Law that:

              (A) is for relief against the Company in an involuntary case;

              (B) appoints a Custodian of the Company or for all or
                  substantially all of its property; or

              (C) orders the liquidation of the Company, and the order or
                  decree remains unstayed and in effect for ninety (90)
                  calendar days;

        (c) the Company's Common Stock is suspended or is no longer listed on
            any recognized exchange, including an electronic over-the-counter
            bulletin board, for in excess of fifteen (15) consecutive trading
            days;

        (d) the Company fails to comply with any of the Articles of this
            Note as outlined.  As used in this Section 4.1, the term
            "Bankruptcy Law" means Title 11 of the United States Code or any
            similar federal or state law for the relief of debtors.  The
            term "Custodian" means any receiver, trustee, assignee, liquidator
            or similar official under any Bankruptcy Law.

After two consecutive Events of Default, as outlined in this Note, the
Holder can exercise its right to increase the Face Amount of the Note by
ten percent (10%) as an initial penalty and for each Event of Default under
this Note.  In addition, the Holder may elect to increase the Face Amount
by two and one-half percent (2.5%) per month paid as a penalty for liquated
damages ("Liquidated Damages"). The Liquated Damages will be compounded daily.
It is the intention and acknowledgement of both parties that the Liquidated
Damages not be deemed as interest.

In the event of a Default hereunder, the Holder may elect to secure a portion
of the Company's assets not to exceed 200% of the Face Amount of the Note,
including, but not limited to: accounts receivable through February 28, 2008,
cash, marketable securities, equipment, building, land or inventory.  The
Holder may also elect to garnish revenue from the Company in an amount that
will repay the Holder for unpaid amounts due under this Note.

For each Event of Default, as outlined in this Note, the Holder can
exercise its right to increase the Face Amount of the Note by ten percent
(10%) as an initial penalty.  In addition, the Holder may elect to increase
the Residual Amount by two and one-half percent (2.5%) per month paid as a
penalty for Liquidated Damages.  The Liquidated Damages will be compounded
daily.  It is the intention and acknowledgement of both parties that the
Liquidated Damages not be deemed as interest.

<PAGE>

Article 5  Additional Financing

The Company shall not, neither directly nor indirectly, without the prior
written consent of Holder, offer Common Stock or file any registration
statement, (except those on Form S-8 or, in the case of an acquisition, on
Form S-4) for any securities (a "Subsequent Financing"), ending on the earlier
to occur of (i) Maturity Date or (ii) the date on which the full Face Amount
on the Note has been paid (each the "Lock Up Period") except with respect to
securities issued pursuant to Company's employee stock option plan or Common
Stock issued for acquisitions. Failure to do so will result in an Event of
Default and the Holder may elect to take the action outlined in Article 4.
The sole exceptions shall be any registration statements required to be filed
by the Company for previous financings completed by Laurus Funds.

Article 6  Mergers

The Company shall not consolidate or merge into, or transfer all or
substantially all of its assets to, any person, unless such person assumes in
writing the obligations of the Company under this Note and immediately after
such transaction no Event of Default exists. Any reference herein to the
Company shall refer to such surviving or transferee corporation and the
obligations of the Company shall terminate upon such written assumption.
Failure to do so will constitute an Event of Default under this Note
and the Holder may immediately seek to take actions as described under
Article 4 of this Note.

Article 7  Notice

Any notices, consents, waivers or other communications required or permitted
to be given under the terms of this Note must be in writing and will be deemed
to have been delivered (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided a confirmation of transmission is
mechanically or electronically generated and kept on file by the sending
party); or (iii) one (1) day after deposit with a nationally recognized
overnight delivery service, in each case properly addressed to the party
to receive the same.  The addresses and facsimile numbers for such
communications shall be:

        If to the Company:

        Stuart Turk
        85 Corstate Avenue, Unit #1
        Concord, Ontario, Canada L4K 4Y2
        Facsimile 905-760-2987

        Copy to:

        Amy Trombly, Esq.
        Trombly Business Law
        1320 Centre Street, Suite 202
        Newton, MA  02459
        Facsimile 617-243-0066

        If to the Holder:

        Dutchess
        Douglas Leighton
        50 Commonwealth Avenue, Suite 2
        Boston, MA  02116
        Phone   617-301-4700
        Facsimile 617-249-0947

<PAGE>

Each party shall provide five (5) business days prior notice to the other
party of any change in address, phone number of facsimile number.

Article 8 Time

Where this Note authorizes or requires the payment of money or the performance
of a condition or obligation on a Saturday or Sunday or a holiday in which
the United States Stock Markets ("US Markets") are closed ("Holiday"), or
authorizes or requires the payment of money or the performance of a condition
or obligation within, before or after a period of time computed from a certain
date, and such period of time ends on a Saturday or a Sunday or a Holiday,
such payment may be made or condition or obligation performed on the next
succeeding business day, and if the period ends at a specified hour, such
payment may be made or condition performed, at or before the same hour of
such next succeeding business day, with the same force and effect as if made
or performed in accordance with the terms of this Note.  A "business day"
shall mean a day on which the US Markets are open for a full day or half day
of trading.

Article 9  No Assignment

This Note shall not be assigned.

Article 10 Rules of Construction.

In this Note, unless the context otherwise requires, words in the singular
number include the plural, and in the plural include the singular, and
words of the masculine gender include the feminine and the neuter, and
when the tense so indicates, words of the neuter gender may refer to any
gender.  The numbers and titles of sections contained in the Note are
inserted for convenience of reference only, and they neither form a part
of this Note nor are they to be used in the construction or interpretation
hereof.  Wherever, in this Note, a determination of the Company is required
or allowed, such determination shall be made by a majority of the Board of
Directors of the Company and, if it is made in good faith, it shall be
conclusive and binding upon the Company and the Holder.

Article 11 Governing Law

The validity, terms, performance and enforcement of this Note shall be
governed and construed by the provisions hereof and in accordance with the
laws of the Commonwealth of Massachusetts applicable to agreements that are
negotiated, executed, delivered and performed solely in the Commonwealth of
Massachusetts.

Article 12 Litigation

The parties to this Note will submit all disputes arising under this
Note to arbitration in Boston, Massachusetts before a single arbitrator
of the American Arbitration Association ("AAA").  The arbitrator shall be
selected by application of the rules of the AAA, or by mutual agreement of
the parties, except that such arbitrator shall be an attorney admitted to
practice law in the Commonwealth of Massachusetts.  No party to this Note
will challenge the jurisdiction or venue provisions as provided in this
section.  Nothing in this section shall limit the Holder's right to obtain
an injunction for a breach of this Note from a court of law.

Article 13 RESERVED

<PAGE>

Article 14 Closing Costs

The Company paid fees associated with the transaction in the amount of
Ninety Thousand Dollars ($90,000) U.S. directly from the Closing of this Note.
No further fee is required for the amendment of this Note.

Article 15 Indemnification

In consideration of the Holder's execution and delivery of this Note and
the acquisition and funding by the Holder of the Note hereunder and in
addition to all of the Company's other obligations under the documents
contemplated hereby, the Company shall defend, protect, indemnify and hold
harmless the Holder and all of its shareholders, officers, directors,
employees, counsel, and direct or indirect investors and any of the
foregoing person's agents or other representatives (including, without
limitation, those retained in connection with the transactions contemplated
by this Note) (collectively, the "Indemnities") from and against any
and all actions, causes of action, suits, claims, losses, costs, penalties,
fees, liabilities and damages, and expenses in connection therewith
(irrespective of whether any such Indemnitee is a party to the action
for which indemnification hereunder is sought), and including reasonable
attorneys' fees and disbursements (the "Indemnified Liabilities" ), incurred
by any Indemnitee as a result of, or arising out of, or relating to (i) any
misrepresentation or breach of any representation or warranty made by the
Company in the Note, or any other certificate, instrument or document
contemplated hereby or thereby (ii) any breach of any covenant, agreement or
obligation of the Company contained in the Note or any other certificate,
instrument or document  contemplated hereby or thereby, except insofar as any
such misrepresentation, breach or any untrue statement, alleged untrue
statement, omission or alleged omission is made in reliance upon and in
conformity with written information furnished to the Company by, or on behalf
of, the Holder or is based on illegal trading of the Common Stock by the
Holder. To the extent that the foregoing undertaking by the Company may be
unenforceable for any reason, the Company shall make the maximum contribution
to the payment and satisfaction of each of the Indemnified Liabilities that
is permissible under applicable law. The indemnity provisions contained herein
shall be in addition to any cause of action or similar rights the Holder may
have, and any liabilities the Holder may be subject to.

Article 16 Waiver

The Holder's delay or failure at any time or times hereafter to require strict
performance by Company of any undertakings, agreements or covenants shall not
waiver, affect, or diminish any right of the Holder under this Note to
demand strict compliance and performance herewith. Any waiver by the Holder of
any Event of Default shall not waive or affect any other Event of Default,
whether such Event of Default is prior or subsequent thereto and whether of
the same or a different type. None of the undertakings, agreements and
covenants of the Company contained in this Note, and no Event of Default,
shall be deemed to have been waived by the Holder, nor may this Note be
amended, changed or modified, unless such waiver, amendment, change or
modification is evidenced by an instrument in writing specifying such waiver,
amendment, change or modification and signed by the Holder.

Article 17 RESERVED

Article 18 RESERVED

Article 19 RESERVED

<PAGE>

Article 20 Transactions With Affiliates.

The Company shall not, and shall cause each of its Subsidiaries not to,
enter into, amend, modify or supplement, or permit any Subsidiary to enter
into, amend, modify or supplement, any agreement, transaction, commitment or
arrangement with any of its or any Subsidiary's officers, directors, persons
who were officers or directors at any time during the previous two years,
shareholders who beneficially own five percent(5%) or more of the Common Stock,
or affiliates or with any individual related by blood, marriage or adoption to
any such individual or with any entity in which any such entity or individual
owns a five percent (5%) or more beneficial interest (each a "Related Party")
during the Lock Up Period.  This Article 20 shall not apply to compensation
arrangements with officers and directors.

Article 21 Investor Shares

The Company  issued four hundred thousand (400,000) shares of unregistered,
restricted Common Stock to the Holder as an incentive for the investment
("Shares").  Provided however, the Incentive Shares issued were not to exceed
4.99% of the total outstanding of the Company's Common Stock at any time
("Maximum Deliverable Shares").  The Maximum Deliverable Shares shall be
delivered immediately to the Holder and shall carry piggyback registration
rights.  Any shares due to the Holder in excess of the Maximum Deliverable
Shares shall be issued to the Holder at such time when the Holder's total
aggregate shares are equal to or less than 2.5% of the total outstanding
shares of the Company ("Additional Incentive Shares").  Upon such time, the
Company will issue to the Holder, in whole or in part, the Additional
Incentive Shares.   In no instance shall the issuance of the Additional
Incentive shares, when combined with the total number of shares then held
by the Holder (including Incentive Shares held pursuant to the Prior Note(s)),
does not exceed 4.99% of the total outstanding Common Stock.  The Investor's
Shares shall be deemed fully earned as of the date hereof valued at sixty
six cents ($0.66) per share.  In the event the Shares are not registered in
the next registration statement, the Company shall pay to the Holder, as a
penalty, four hundred thousand (400,000) additional shares of common stock
for each time a registration statement is filed and the Shares are not
included.  The Holder retains the right to waive such penalty, in the event
Holder chooses to do so.  Failure to do so will result in an Event of Default
and the Holder may elect to take the action outlined in Article 4.  This
Event of Default will survive this Note until such time as the Shares
are no longer under the control of the Holder.

Article 22 Use of Proceeds

The Company will use proceeds for general corporate working capital purposes
or acquisitions. This shall not to be used to pay down long-term debt to any
financial institution.

<PAGE>

Article 23 Miscellaneous

a. All pronouns and any variations thereof used herein shall be deemed to
   refer to the masculine, feminine, impersonal, singular or plural, as the
   identity of the person or persons may require.

b. Neither this Note nor any provision hereof shall be waived, modified,
   changed, discharged, terminated, revoked or canceled, except by an
   instrument in writing signed by the party effecting the same against
   whom any change, discharge or termination is sought.

c. Notices required or permitted to be given hereunder shall be in writing
   and shall be deemed to be sufficiently given when personally delivered
   or sent by facsimile transmission:

   (i)  if to the Company or to the Holder, at the address for correspondence
   set forth in the Article 7 herein, or at such other specified by written
   notice given in accordance with this paragraph.

d. This Note may be executed in two or more counterparts, all of which taken
   together shall constitute one instrument. Execution and delivery of this
   Note by exchange of facsimile copies bearing the facsimile signature of a
   party shall constitute a valid and binding execution and delivery of this
   Note by such party.  Such facsimile copies shall constitute enforceable
   original documents.

e. The execution and delivery of this Note shall not alter the prior written
   agreements between the Company and the Holder, consisting of the prior
   Notes currently due to the Holder.  This Note is the FINAL AGREEMENT
   between the Company and the Holder with respect to the terms and conditions
   set forth herein, and, the terms of this Note may not be contradicted by
   evidence of prior, contemporaneous, or subsequent oral agreements of the
   parties.

f. The execution, delivery and performance of this Note by the Company and
   the consummation by the Company of the transactions contemplated hereby and
   thereby will not

   (i) result in a violation of the Articles of Incorporation, any Certificate
       of Designations, Preferences and Rights of any outstanding series of
       preferred stock of the Company or the By-laws or (ii) conflict with,
       or constitute a material default (or an event which with notice or
       lapse of time or both would become a material default) under, or give
       to others any rights of termination, amendment, acceleration or
       cancellation of, any material agreement, contract, indenture mortgage,
       indebtedness or instrument to which the Company or any of its
       Subsidiaries is a party, or result in a violation of any law, rule,
       regulation, order, judgment or decree, including United States
       federal and state securities laws and regulations and the rules and
       regulations of the principal securities exchange or trading market
       on which the Common Stock is traded or listed (the "Principal Market"),
       applicable to the Company or any of its Subsidiaries or by which any
       property or asset of the Company or any of its Subsidiaries is bound
       or affected. Neither the Company nor its Subsidiaries is in violation
       of any term of, or in default under, the Articles of Incorporation,
       any Certificate of Designations, Preferences and Rights of any
       outstanding series of preferred stock of the Company or the By-laws
       or their organizational charter or by-laws, respectively, or any
       contract, agreement, mortgage, indebtedness, indenture, instrument,

<PAGE>

       judgment, decree or order or any statute, rule or regulation
       applicable to the Company or its Subsidiaries, except for possible
       conflicts, defaults, terminations, amendments, accelerations,
       cancellations and violations that would not individually or in the
       aggregate have a Material Adverse Effect. The business of the Company
       and its Subsidiaries is not being conducted, and shall not be conducted,
       in violation of any law, statute, ordinance, rule, order or regulation
       of any governmental authority or agency, regulatory or self-regulatory
       agency, or court, except for possible violations the sanctions for
       which either individually or in the aggregate would not have a
       Material Adverse Effect.  The Company is not required to obtain
       any consent, authorization, permit or order of, or make any filing
       or registration (except the filing of a registration statement) with,
       any court, governmental authority or agency, regulatory or
       self-regulatory agency or other third party in order for it to
       execute, deliver or perform any of its obligations under, or
       contemplated by, this Note in accordance with the terms hereof or
       thereof. All consents, authorizations, permits, orders, filings and
       registrations which the Company is required to obtain pursuant to the
       preceding sentence have been obtained or effected on or prior to the
       date hereof and are in full force and effect as of the date hereof.
       The Company and its Subsidiaries are unaware of any facts or
       circumstances which might give rise to any of the foregoing. The
       Company is not, and will not be, in violation of the listing
       requirements of the Principal Market as in effect on the date hereof
       and on each of the Closing Dates and is not aware of any facts which
       would reasonably lead to delisting of the Common Stock by the
       Principal Market in the foreseeable future.

g. The Company and its "Subsidiaries" (which for purposes of this Note means
   any entity in which the Company, directly or indirectly, owns capital stock
   or holds an equity or similar interest) are corporations duly organized and
   validly existing in good standing under the laws of the respective
   jurisdictions of their incorporation, and have the requisite corporate
   power and authorization to own their properties and to carry on their
   business as now being conducted. Both the Company and its Subsidiaries are
   duly qualified to do business and are in good standing in every jurisdiction
   in which their ownership of property or the nature of the business
   conducted by them makes such qualification necessary, except to the
   extent that the failure to be so qualified or be in good standing would not
   have a Material Adverse Effect. As used in this Note, "Material Adverse
   Effect" means any material adverse effect on the business, properties,
   assets, operations, results of operations, financial condition or prospects
   of the Company and its Subsidiaries, if any, taken as a whole, or on the
   transactions contemplated hereby or by the agreements and instruments to
   be entered into in connection herewith, or on the authority or ability of
   the Company to perform its obligations under the Note.

h. Authorization; Enforcement; Compliance with Other Instruments.  (i) The
   Company has the requisite corporate power and authority to enter into and
   perform this Note, and to issue the Note and Common Stock upon conversion
   of this Note in accordance with the terms hereof and thereof, (ii) the
   execution and delivery of the Note by the Company and the consummation by
   it of the transactions contemplated hereby and thereby, including without
   limitation the reservation for issuance and the issuance of the Common
   Stock underlying this Note, have been duly and validly authorized by the
   Company's Board of Directors and no further consent or authorization is
   required by the Company, its Board of Directors, or its shareholders,
   (iii) the Note has been duly and validly executed and delivered by the
   Company, and (iv) the Note constitutes the valid and binding obligations
   of the Company enforceable against the Company in accordance with their
   terms, except as such enforceability may be limited by general principles
   of equity or applicable bankruptcy, insolvency, reorganization, moratorium,
   liquidation or similar laws relating to, or affecting generally, the
   enforcement of creditors' rights and remedies.

<PAGE>

i. There are no disagreements of any kind presently existing, or reasonably
   anticipated by the Company to arise, between the Company and the
   accountants, auditors and attorneys formerly or presently used by the
   Company, including but not limited to disputes or conflicts over payment
   owed to such accountants, auditors or attorneys.

j. All representations made by or relating to the Company of a historical
   nature and all undertakings described herein shall relate and refer to
   the Company, its predecessors, and the Subsidiaries.

k. The Company acknowledges that its failure to timely meet any of its
   obligations hereunder, including, but without limitation, its obligations
   to make Payments, deliver shares and, as necessary, to register and maintain
   sufficient number of Shares, will cause the Holder to suffer irreparable
   harm and that the actual damage to the Holder will be difficult to
   ascertain.  Accordingly, the parties agree that it is appropriate to
   include in this Note a provision for liquidated damages.  The parties
   acknowledge and agree that the liquidated damages provision set forth
   in this section represents the parties' good faith effort to quantify
   such damages and, as such, agree that the form and amount of such
   liquidated damages are reasonable and do not constitute a penalty.  The
   payment of liquidated damages shall not relieve the Company from its
   obligations to deliver the Common Stock pursuant to the terms of this
   Note.

l. In the event that any rules, regulations, interpretations or comments
   from the SEC or other governing body, hinder any operation of this
   Note, the parties hereby agree that those specific terms and conditions
   shall be negotiated on similar terms within five (5) business days, and
   shall not alter, diminish or affect any other rights, duties or covenants
   in this Note and that all terms and conditions will remain in full force
   and effect except as is necessary to make those specific terms and
   conditions comply with applicable rule, regulation, interpretation or
   comment.  Failure for the Company to agree to such new terms, shall
   constitute and Event of Default herein, as outlined in Article 4, and
   the Holder may elect to take actions as    outlined in this Note.

Any misrepresentations shall be considered a breach of contract and Default
under this Note and the Holder may seek to take actions as described
under Article 4 of this Note.

                                        *****

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

                                       ON THE GO HEALTHCARE, INC.

                                       By: /s/ Stuart Turk
                                       -----------------------------
                                       Name:  Stuart Turk
                                       Title: Chief Executive Officer

                                       DUTCHESS PRIVATE EQUITIES FUND, LTD
                                       as successor-in-interest to Dutchess
                                       Private Equities Fund, L.P.
                                       BY ITS GENERAL PARTNER DUTCHESS
                                       CAPITAL MANAGEMENT, LLC

                                       By: /s/ Douglas H. Leighton
                                       -----------------------------
                                       Name:  Douglas H. Leighton
                                       Title:  A Managing Member

<PAGE>

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00138-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00138-of-00352.parquet"}]]