Document:

EXHIBIT 10.19

THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED OR DISPOSED OF
EXCEPT PURSUANT TO (1) A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR (2) UPON
DELIVERY OF A LEGAL OPINION TO THE COMPANY, IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO THE COMPANY, THAT ANY SUCH TRANSACTION IS EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE
SECURITIES LAWS.

                                                         Dated: October 13, 2006

                                     WARRANT

                       To Purchase _____________ shares of
                          Common Stock, $.01 par value

                                       of

                      PERFORMANCE HEALTH TECHNOLOGIES, INC.

                            Expiring October 13, 2011

         THIS IS TO CERTIFY THAT, for value
received,___________________________, or his registered assigns (hereinafter
referred to as the ("HOLDER"), is entitled to subscribe and purchase from
PERFORMANCE HEALTH TECHNOLOGIES, INC., a Delaware corporation (the "COMPANY"),
commencing on the date hereof, ___________ shares of Common Stock, $.01 par
value, of the Company (the "SHARES"), at the place where the Warrant Agency (as
hereinafter defined) is located, at the Exercise Price (as hereinafter defined),
all subject to adjustment and upon the terms and conditions as hereinafter
provided, and is entitled also to exercise the other appurtenant rights, powers
and privileges hereinafter described.

         Capitalized terms used in this Warrant and not otherwise defined shall
have the meanings set forth in Article V hereof.

                                    ARTICLE I
                              EXERCISE OF WARRANTS

         Section 1.01 METHOD OF EXERCISE. To exercise this Warrant in whole or
in part, the Holder shall deliver to the Company at the Warrant Agency, (a) this
Warrant, (b) a written notice, in substantially the form of the Subscription
Notice attached hereto, of such Holder's election to exercise this Warrant,
which notice shall specify the number of Shares to be purchased, the
denominations of the share certificate or certificates desired and the name or
names in which such certificates are to be registered and (c) the aggregate
Exercise Price for the Shares purchased (unless the Holder chooses the "cashless
exercise" option provided in the third paragraph of this Section 1.01).

                                      -1-
<PAGE>

         The Company shall, as promptly as practicable and in any event within
seventy-two hours thereafter, execute and deliver or cause to be executed and
delivered, in accordance with such notice, a certificate or certificates
representing the aggregate number of Shares specified in said notice. The Share
certificate or certificates so delivered shall be in such denominations as
determined by the Company, or as may be specified in such notice, and shall be
issued in the name of the Holder or such other name or names as shall be
designated in such notice. Such certificate or certificates shall be deemed to
have been issued, and such Holder or any other person so designated to be named
therein shall be deemed for all purposes to have become holders of record of
such Shares, as of the date the aforementioned notice is received by the
Company. If this Warrant shall have been exercised only in part, the Company
shall, at the time of delivery of the certificate or certificates, deliver to
the Holder a new Warrant evidencing the rights to purchase the remaining Shares
called for by this Warrant, which new Warrant shall in all other respects be
identical with this Warrant, or, at the request of the Holder, appropriate
notation may be made on this Warrant which shall then be returned to the Holder.
The Company shall pay all expenses, payable in connection with the preparation,
issuance and delivery of Share certificates and new Warrants as contemplated by
Section 2.07 below (other than transfer, income or similar taxes in connection
with the transfer of securities), except that, if Share certificates or new
Warrants shall be registered in a name or names other than the name of the
Holder, funds sufficient to pay all transfer taxes payable as a result of such
transfer shall be paid by the Holder at the time of delivering the
aforementioned notice of exercise or promptly upon receipt of a written request
of the Company for payment.

         In lieu of a monetary payment of the aggregate Exercise Price, the
Holder may elect to receive, without the payment of any additional
consideration, Shares equal to the value of this Warrant or portion thereof by
the surrender of such Warrant to the Company with the "cashless exercise"
election marked in the form of Subscription Notice. Thereupon, the Company shall
issue to the Holder, such number of fully paid and non-assessable Shares as is
computed using the following formula:

                                   X = Y(A-B)
                                       ------
                                         A

where      X =   the number of Shares to be issued to the Holder pursuant to
                 this Section 1.01 upon such cashless exercise election.

           Y =   the number of Shares covered by this Warrant in
                 respect of which the cashless exercise election is made.

           A =   the Fair Market Value (as defined in Article V
                 hereof) of one Share, as at the time the cashless
                 exercise election is made.

                                      -2-
<PAGE>

           B =   the Exercise Price in effect under this Warrant at
                 the time the cashless exercise election is made.

         Section 1.02 SHARES TO BE FULLY PAID AND NON-ASSESSABLE. All Shares
issued upon the exercise of this Warrant (the "WARRANT SHARES") pursuant to
Section 1.01 above shall be validly issued, fully paid and nonassessable and the
Company shall at all times reserve and keep available out of its authorized
shares of Common Stock a sufficient number of Shares for the purpose of issuance
of the Warrant Shares upon the exercise of this Warrant.

         Section 1.03 NO FRACTIONAL SHARES TO BE ISSUED. The Company shall not
be required to issue fractions of Shares upon exercise of this Warrant. If any
fraction of a Share would, but for this Section, be issuable upon any exercise
of this Warrant, in lieu of such fractional Share the Company shall pay to the
Holder or Holders, as the case may be, in cash, an amount equal to the same
fraction of the Fair Market Value per share of outstanding Shares on the
Business Day immediately prior to the date of such exercise.

         Section 1.04 SHARE LEGEND. Each certificate for Shares issued upon
exercise of this Warrant shall bear the legend set forth below, unless Holder's
Counsel (as defined below) shall render an opinion in form and substance
reasonably satisfactory to the Company that such legend is not required or at
the time of exercise such Shares are registered under the Securities Act:

         THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
         AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED OR
         DISPOSED OF EXCEPT PURSUANT TO (1) A REGISTRATION STATEMENT WHICH HAS
         BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, IN EACH CASE IN
         ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
         UNITED STATES OR (2) UPON DELIVERY OF A LEGAL OPINION TO THE COMPANY,
         IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, THAT ANY
         SUCH TRANSACTION IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE
         SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

         Any certificate issued at any time in exchange or substitution for any
certificate bearing such legend (except a new certificate issued upon completion
of a public distribution pursuant to a registration statement under the
Securities Act) shall also bear such legend unless, in the opinion (in form and
substance reasonably satisfactory to the Company) of counsel selected by the
Holder of such certificate and who is reasonably acceptable to the Company
("HOLDER'S COUNSEL"), the securities represented thereby need no longer be
subject to restrictions on resale under the Securities Act.

                                      -3-
<PAGE>

                                   ARTICLE II
                            WARRANT AGENCY; TRANSFER,
                      EXCHANGE AND REPLACEMENT OF WARRANTS

         Section 2.01 WARRANT AGENCY. Until such time, if any, as an independent
agency shall be appointed by the Company to perform services with respect to the
Warrants described herein (the "WARRANT AGENCY"), the Company shall perform the
obligations of the Warrant Agency provided herein at its principal office
address or such other address as the Company shall specify by prior written
notice to all Holders.

         Section 2.02 OWNERSHIP OF WARRANT. The Company may deem and treat the
person in whose name this Warrant is registered as the holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by any person
other than the Company) for all purposes and shall not be affected by any notice
to the contrary, until presentation of this Warrant for registration of transfer
as provided in this Article II.

         Section 2.03 TRANSFER OF WARRANT. The Company agrees to maintain at the
Warrant Agency books for the registration of transfers of this Warrant and all
rights hereunder shall be registered, in whole or in part, on such books, upon
surrender of this Warrant at the Warrant Agency, together with a written
assignment of this Warrant duly executed by the Holder or its duly authorized
agent or attorney. Subject to applicable law and regulation and Section 2.04
hereof, upon surrender of this Warrant as provided for herein, the Company shall
execute and deliver a new Warrant or Warrants in the name of the assignee or
assignees and in the denominations specified in the instrument of assignment,
and this Warrant shall promptly be canceled. Notwithstanding the foregoing, a
Warrant may be exercised by a new Holder which has become the registered Holder
of such Warrant without having a new Warrant issued.

         Section 2.04 RESTRICTIONS ON TRANSFER. The Holder, by its acceptance
hereof, represents that this Warrant is being acquired for its own account, as
an investment and not with a view towards the further resale or the distribution
thereof in violation of the Securities Act, and agrees that this Warrant may not
be transferred, sold, assigned, hypothecated or otherwise disposed of, in whole
or in part, except as provided in the legend on the first page hereof and
provided that the Holder shall have furnished to the Company an opinion of
Holder's Counsel, in form and substance reasonably satisfactory to the Company,
to the effect that such transfer is exempt from the registration requirements of
the Securities Act and any applicable state securities laws.

         Section 2.05 DIVISION OR COMBINATION OF WARRANTS. This Warrant may be
divided or combined with other Warrants upon surrender hereof and of any Warrant
or Warrants with which this Warrant is to be combined at the Warrant Agency,
together with a written notice specifying the names and denominations in which
the new Warrant or Warrants are to be issued, signed by the holders hereof and
thereof or their respective duly authorized agents or attorneys. Subject to
compliance with Section 2.04 as to any transfer which may be involved in the
division or combination, the Company shall execute and deliver a new Warrant or
Warrants in exchange for the Warrant or Warrants to be divided or combined in
accordance with such notice.

                                      -4-
<PAGE>

         Section 2.06 LOSS, THEFT, DESTRUCTION OF WARRANT CERTIFICATES. Upon
receipt by the Company of a written notice (or other evidence reasonably
satisfactory to the Company) of the loss, theft, destruction or mutilation of
any Warrant and, in the case of any such loss, theft or destruction, upon
receipt of indemnity or security reasonably satisfactory to the Company or, in
the case of any such mutilation, upon surrender and cancellation of such
Warrant, the Company will make and deliver, in lieu of such lost, stolen,
destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same aggregate number of Shares.

         Section 2.07 EXPENSES OF DELIVERY OF WARRANTS. The Company shall pay
all expenses (other than transfer taxes) and other charges payable in connection
with the preparation, issuance and delivery of Warrants and Warrant Shares
hereunder.

                                   ARTICLE III
                      COMPANY COVENANTS AND REPRESENTATIONS

         Section 3.01 COMPANY COVENANTS. In case at any time the Company shall
(a) declare any dividend or distribution on its Shares, whether payable in cash,
stock or other property, (b) offer to all holders of Shares any additional
shares of Common Stock, or any option, right or warrant to subscribe therefore,
or (c) declare a dissolution, liquidation or winding up of the Company (other
than in connection with a consolidation or merger) or propose a sale of
substantially all of its property, assets and business as an entirety, then the
Company shall give written notice to the Holder of the date on which the books
of the Company shall close or a record shall be taken for such action. Such
notice shall also specify the date as of which the holders of Shares of record
shall participate in such dividend or distribution. Such written notice shall be
given at least 30 days and not more than 90 days prior to the action in
question, and not less than 15 days prior to the relevant record date or the
date fixed for determining stockholders entitled to participate therein, as the
case may be.

         Section 3.02 AUTHORITY, EXECUTION AND DELIVERY. The Company hereby
represents and warrants that the Company has full corporate power and authority
to enter into this Warrant and to issue Shares in accordance with the terms
hereof. The execution, delivery and performance of this Warrant by the Company
have been duly and effectively authorized by the Company. This Warrant has been
duly executed and delivered by the Company and constitutes the legal, valid and
binding obligation of the Company enforceable against the Company in accordance
with its terms.

         Section 3.03 INFORMATION REQUIREMENTS. To the extent applicable, the
Company shall promptly furnish the Holder with copies of all reports, proxy
statements and similar materials that it mails to holders of its Common Stock.

                                   ARTICLE IV
                               CERTAIN DEFINITIONS

         The following terms, as used in this Warrant, have the following
respective meanings:

         "BUSINESS DAYS" means each day in which banking institutions in New
York are not required or authorized by law or executive order to close.

                                      -5-
<PAGE>

         "EXERCISE PRICE" means $0.50 per share, subject to adjustment pursuant
to Article V.

                                    ARTICLE V
                                   ADJUSTMENTS

         Section 5.01 ADJUSTMENT OF WARRANT EXERCISE PRICE UPON SUBDIVISION OR
COMBINATION OF COMMON STOCK. If the Company at any time after the date of
issuance of this Warrant subdivides (by any stock split, stock dividend,
recapitalization or otherwise) one or more classes of its outstanding shares of
Common Stock into a greater number of shares, any Warrant Exercise Price in
effect immediately prior to such subdivision will be proportionately reduced and
the number of shares of Common Stock obtainable upon exercise of this Warrant
will be proportionately increased. If the Company at any time after the date of
issuance of this Warrant combines (by combination, reverse stock split or
otherwise) one or more classes of its outstanding shares of Common Stock into a
smaller number of shares, any Warrant Exercise Price in effect immediately prior
to such combination will be proportionately increased and the number of Warrant
Shares issuable upon exercise of this Warrant will be proportionately decreased.
Any adjustment under this Section 8(d) shall become effective at the close of
business on the date the subdivision or combination becomes effective.

         Section 5.02 NOTICES. Immediately upon any adjustment of the Warrant
Exercise Price, the Company will give written notice thereof to the holder of
this Warrant, setting forth in reasonable detail, and certifying, the
calculation of such adjustment.

                                   ARTICLE VI
                                  MISCELLANEOUS

         Section 6.01 NOTICES. Any notice or other communication to be given
hereunder shall be in writing and shall be delivered by recognized courier,
telecopy or certified mail, return receipt requested, and shall be conclusively
deemed to have been received by a party hereto and to be effective on the day on
which delivered or telecopied to such party at its address set forth below (or
at such other address as such party shall specify to the other parties hereto in
writing), or, if sent by certified mail, on the third business day after the day
on which mailed, addressed to such party at such address. In the case of the
Holder, such notices and communications shall be addressed to its address as
shown on the books maintained by the Warrant Agency, unless the Holder shall
notify the Company and the Warrant Agency that notices and communications should
be sent to a different address, in which case such notices and communications
shall be sent to the address specified by the Holder, and in either case a copy
of such notices and communications shall be sent to Thomas P. Gallagher,
Gallagher, Briody & Butler, 155 Village Boulevard, Princeton, New Jersey 08540
Fax: (609) 454-0090. In the case of the Company, such notices and communications
shall be addressed as follows (until notice of a change is given as provided
herein): Performance Health Technologies, Inc., 427 River View Plaza, Trenton,
New Jersey 08611, Attention: Robert Prunetti, Fax: (609) 656-0869.

                                      -6-
<PAGE>

         Section 6.02 WAIVERS; AMENDMENTS. No failure or delay of the Holder in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of such right or power, or any abandonment
or discontinuance of steps to enforce such a right or power, preclude any other
or further exercise thereof or the exercise of any other right or power. The
rights and remedies of the Holder are cumulative and not exclusive of any rights
or remedies which it would otherwise have. The provisions of this Warrant may be
amended, modified or waived with (and only with) the written consent of the
Company and Holders holding a majority of Warrants at the time outstanding (or
any permitted transferee of all of the Warrant). In the event of any such
amendment, modification or waiver the Company shall give prompt notice thereof
to all Holders of Warrants and, if appropriate, notation thereof shall be made
on all Warrants thereafter surrendered for registration of transfer or exchange.
No notice or demand on the Company in any case shall entitle the Company to any
other or further notice or demand in similar or other circumstances.

         Section 6.03 GOVERNING LAW. This Warrant shall be construed in
accordance with and governed by the laws of the State of Delaware without regard
to choice of law doctrine.

         Section 6.04 COVENANTS TO BIND SUCCESSOR AND ASSIGNS. All covenants,
stipulations, promises and agreements in this Warrant contained by or on behalf
of the Company shall bind its successors and assigns, whether so expressed or
not.

         Section 6.05 SEVERABILITY. In case any one or more of the provisions
contained in this Warrant shall be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein and therein shall not in any way be affected or impaired
thereby. The parties shall endeavor in good faith negotiations to replace the
invalid, illegal or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.

         Section 6.06 SECTION HEADINGS. The section headings used herein are for
convenience of reference only, are not part of this Warrant and are not to
affect the construction of or be taken into consideration in interpreting this
Warrant.

         Section 6.07 NO RIGHTS AS STOCKHOLDER. This Warrant shall not entitle
the Holder to any rights as a stockholder of the Company.

         Section 6.08 NO REQUIREMENT TO EXERCISE. Nothing contained in this
Warrant shall be construed as requiring the Holder to exercise this Warrant.

         IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
in its corporate name by one of its officers thereunto duly authorized, and
attested by its Secretary or an Assistant Secretary, all as of the day and year
first above written.

                                  PERFORMANCE HEALTH TECHNOLOGIES, INC.

                                  By:
                                     ------------------------------------
                                     Robert D. Prunetti
                                     President and Chief Executive Officer

                                      -7-
<PAGE>

                               SUBSCRIPTION NOTICE

                    (To be executed upon exercise of Warrant)

To:  Performance Health Technologies, Inc. (the "Company")

The undersigned hereby irrevocably elects:

                  (i) to exercise the right of purchase represented by the
         attached Warrant for, and to purchase thereunder, __________ Shares, as
         provided for therein, and tenders herewith payment of the Exercise
         Price in full in the form of certified or bank cashier's check or wire
         transfer; or

                  (ii) the "cashless exercise" of its rights under the Section
         1.01 of the attached Warrant with respect to ___________ Shares
         otherwise available for purchase to it under the Warrant and receive
         such number of Shares as provided in the formula set forth in such
         Section 1.01.

Please issue a certificate or certificates for such Shares in the following name
or names and denominations:

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

------------------------------------------------------------------------------ .

In connection with the exercise of the Warrant, the undersigned hereby
represents and warrants that:

         (i) it recognizes that the Shares issuable pursuant to the attached
Warrant have not been registered under the Securities Act and may not be sold,
pledged or otherwise transferred except pursuant to the exceptions set forth on
the legend on such Shares which is also set forth in Section 1.04 of the
attached Warrant;

         (ii) it has received all material information with respect to the
Company which it deems necessary with its decision to exercise the attached
Warrant and it has been given an opportunity to ask questions and receive
answers from representatives of the Company;

         (iii) it is purchasing the Shares for its own account, for the purpose
of investment only, and not with a view towards the further resale or
distribution thereof; and

         (iv) it is an "Accredited Investor" within the meaning of Rule 501 of
Regulation D under the Securities Act of 1933, as amended.

                                      -8-
<PAGE>

If said number of Shares shall not be all the Shares issuable upon exercise of
the attached Warrant, a new Warrant is to be issued in the name of the
undersigned for the balance remaining of such Shares less any fraction of a
Share paid in cash.

                                  By:
                                        ----------------------------------------
                                  Name:
                                        ----------------------------------------
                                  Its:
                                        ----------------------------------------

Dated: ____________________       NOTE:  The above signatory should  correspond
                                         exactly with the name on the face of
                                         the attached  Warrant or with the name
                                         of the assignee appearing in the
                                         assignment form below.

                                      -9-
<PAGE>

                                   ASSIGNMENT

                   (To be executed upon assignment of Warrant)

For value received and in accordance with Section 2.03 of the attached Warrant,
____________________ hereby sells, assigns and transfers unto
___________________________ the attached Warrant, together with all right, title
and interest therein, and does hereby irrevocably constitute and appoint
__________________ attorney to transfer said Warrant on the books of Performance
Health Technologies, Inc. with full power of substitution in the premises.

                                  By:
                                        ----------------------------------------
                                  Name:
                                        ----------------------------------------
                                  Its:
                                        ----------------------------------------
Dated:____________________

                                  NOTE: The above signatory should correspond
                                        exactly with the name on the face of the
                                        attached Warrant.

Consented to and approved in accordance with
Section 2.03 of the attached Warrant

PERFORMANCE HEALTH TECHNOLOGIES, INC.

By:
      ----------------------------------------
Name:
      ----------------------------------------
Its:
      ----------------------------------------

                                      -10-EXHIBIT 10.20

THIS NOTE AND THE SECURITIES ISSUABLE UPON CONVERSION HEREOF OR IN PAYMENT OF
INTEREST HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED OR DISPOSED OF EXCEPT PURSUANT TO (1) A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, IN EACH
CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR (2) UPON DELIVERY OF A LEGAL OPINION TO THE COMPANY, IN FORM
AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, THAT ANY SUCH TRANSACTION
IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY
APPLICABLE STATE SECURITIES LAWS.

                            AMENDED AND RESTATED NOTE

                                            Note No.
                                                     ---------------------------
$__________ U.S.D. , ____
                                            --------------------------,---------

         FOR VALUE RECEIVED, PERFORMANCE HEALTH TECHNOLOGIES, INC., a Delaware
corporation (the "COMPANY"), promises to pay to the order of [INSERT NAME OF
LENDER] (whether one or more, "LENDER"), in lawful money of the United States of
America, in the manner and at the times provided hereinafter, (i) Principal (as
hereinafter defined); (ii) Interest (as hereinafter defined) and Default
Interest (as hereinafter defined), if any; and (iii) all other amounts due and
payable pursuant to and in accordance with the terms of this Note.

1. DEFINITIONS. In addition to the terms defined elsewhere in this Note, for
purposes of this Note, the following terms shall have the following meanings:

         1.1      "COMMON STOCK" shall have the meaning in Section 6.1.

         1.2 "DEFAULT INTEREST" shall mean interest computed at 10% per annum,
on (i) the Principal from and after such amount becomes due and payable (whether
by maturity, acceleration, or otherwise), and (ii) any and all other unpaid
amounts due pursuant to the terms and provisions of this Note (including, but
not limited to, accrued but unpaid Interest) from and after the respective dates
on which those amounts become due and payable, whether by maturity,
acceleration, or otherwise; in each case from and after any applicable grace
period has expired. Default Interest shall be computed for the actual number of
days elapsed, predicated on a year consisting of 360 days, and shall be payable
on demand. Notwithstanding anything to the contrary contained herein, for any
period in which Default Interest is accruing, Interest shall not accrue.

         1.3 "FUNDAMENTAL CHANGE" shall mean (i) a sale or transfer of all or
substantially all of the assets of the Company in any transaction or series of
transactions (other than sales in the ordinary course of business); (ii) a
merger or consolidation in which the Company is not the survivor; or (iii) the
sale or exchange of all or substantially all of the outstanding shares of the
Common Stock (including by way of merger, consolidation, or other business
combination); or (iv) the consummation by the Company of a public offering
pursuant to an effective registration statement under the Securities Act of
1933, as amended, covering the offer and sale by the Company of its Common Stock
under the Securities Act of 1933, as amended, with minimum gross proceeds to the
Company of $7,500,000.

                                      -1-
<PAGE>

         1.4 "INTEREST" shall mean interest computed at 8.5% per annum on the
Principal. Interest shall be computed on the actual number of days elapsed,
predicated on a year consisting of 360 days.

         1.5 "MATURITY DATE" shall mean the earlier of (a) [INSERT DATE 5 YEARS
AFTER DATE OF NOTE]; or (b) the occurrence of a Fundamental Change.

         1.6 "PRINCIPAL" shall mean $[INSERT AMOUNT OF LOAN, IN INCREMENTS OF
$1,000] or so much thereof as may from time to time be outstanding hereunder.

         1.7 "PRIVATE PLACEMENT MEMORANDUM" shall mean the Company's
Confidential Private Placement Memorandum dated August 20, 2003, as such
Memorandum may be amended or supplemented, describing the Offering pursuant to
which this Note was issued by the Company.

2.       BORROWING, PAYMENTS, MATURITY.

         2.1 BORROWING. Subject to the terms of this Note, the Company has
borrowed and Lender has lent to the Company $[INSERT AMOUNT OF LOAN, IN
INCREMENTS OF $1,000].

         2.2 INTEREST. Interest shall accrue commencing on the date of this
Note. All accrued and unpaid Interest will be payable on each of the first four
anniversaries of this Note and at Maturity. Interest shall be payable at the
option of the Company in cash, Common Stock, or a combination of cash and Common
Stock. If the Company elects to pay interest in Common Stock, upon each such
payment the Company shall deliver to the Holder a certificate representing the
number of shares of Common Stock equal to (i) the dollar amount of Interest so
paid DIVIDED BY (ii) the Conversion Price (as defined in Section 6.4); PROVIDED,
HOWEVER, in the event on any of the first four anniversaries of this Note the
Company elects to pay all Interest then due in Common Stock and such payment
would result in the issuance of a fractional share of Common Stock, the Company
may elect to defer the payment of that amount of Interest that would result in
the issuance of the fractional share until the next anniversary of this Note.
Default Interest shall be payable in cash on demand.

         2.3 MATURITY. All outstanding and unpaid Principal and Interest shall
be due and payable on the Maturity Date, unless otherwise specified herein or
unless accelerated in accordance with the terms or provisions hereof.

                                      -2-
<PAGE>

         2.4 INTEREST. Notwithstanding any provision to the contrary contained
in this Note or in any of the other documents or instruments referred to in this
Note, if at any time or times the interest and any sums considered for such
purpose to be interest, payable under or by reason of this Note or any such
other documents or instruments, should exceed the maximum which, by the laws of
the State having jurisdiction, may be charged with respect to the loan evidenced
hereby, given the nature and all of the pertinent circumstances of such loan,
then all such sums in excess of such maximum shall be deemed not to be interest,
but rather to be payments on account of Principal, and without further agreement
of the parties shall be so applied without regard to any other provision of this
Note; PROVIDED, HOWEVER, that Lender may elect instead that no sums shall be
payable in excess of such maximum, whereupon this Note and such other documents
and instruments shall be deemed amended accordingly without further action by
any party.

3.       COVENANTS.

         3.1 NEGATIVE PLEDGE. The Company shall not grant a security interest
in, pledge, or mortgage any of its assets except the Company may grant or incur
liens, security interests, pledges, mortgages, and other encumbrances, voluntary
or involuntary, covering its assets so long as the loans, borrowings, or other
obligations secured thereby do not exceed $500,000 in the aggregate.

         3.2 VETO RIGHT WITH RESPECT TO CERTAIN ACTIONS. Before the Company
shall amend its Certificate of Incorporation (other than a certificate setting
forth the designations and preferences with respect to any Preferred Stock) or
Bylaws or merge with any other company and following such merger the Company
will be the survivor, the Company will give notice of such action to the Lender.
The notice will contain a summary of the action to be taken, the date on which
the action will be taken (the "Effective Date"), which Effective Date will not
be sooner than thirty (30) days following the date the notice is given, a
statement that the proposed action will be taken unless there is a Convertible
Note Veto (as defined below), the United States address where a Convertible Note
Veto must be sent, and such other information as the Company shall deem
appropriate. If, prior to the Effective Date, the Company shall receive a
Convertible Note Veto, the Company will not take the action described in the
notice. A Convertible Note Veto shall be deemed to occur if, prior to the
Effective Date of the action, the Company shall receive in writing an objection
(which objection will be effective upon either actual receipt by the Company or
the refusal of the Company to accept delivery) to the action from holders of
Eligible Convertible Notes (as hereinafter defined) representing 66-2/3% of the
principal of all Eligible Convertible Notes then outstanding. The Eligible
Convertible Notes shall mean (a) the Convertible Note issued to The Holding
Company at the first closing of the sale of Units as described in the Private
Placement Memorandum, and (b) all other Convertible Notes issued by the Company
pursuant to the Private Placement Memorandum other than Convertible Notes held
by any officer or director of the Company or any person or entity whom an
officer or director of the Company possesses, directly or indirectly, the power
to direct, or cause the direction of, the management or policy of the person or
entity, whether through the ownership of voting securities, by contract, or
otherwise.

         3.3 PREEMPTIVE RIGHTS WITH RESPECT TO PREFERRED STOCK. The Company
hereby grants to the Lender the right to purchase a pro rata portion of any
Preferred Stock issued by the Company at any time while any portion of the
Principal is outstanding. For purposes of this Section 3.3, Lender's pro rata
portion of any Preferred Stock will be that portion of the Preferred Stock to be
issued (rounded to a whole number) multiplied by a fraction the numerator of
which is the Principal then outstanding and the denominator of which will be the

                                      -3-
<PAGE>

principal then outstanding of all Convertible Notes (including this Note) issued
by the Company pursuant to the Private Placement Memorandum. In the event the
Company intends to issue Preferred Stock, it shall give Lender written notice of
such intention, describing the Preferred Stock to be issued, the price thereof,
the number of Preferred Stock that the Lender will be eligible to purchase under
this Section 3.3, the general terms upon which the Company proposes to effect
such issuance, and the United States address where Lender must send notice of
Lender's election to purchase all or part of its Pro Rata Share of the Preferred
Stock. The Lender shall have 30 days from the date of any such notice to agree
to purchase all or part of its Pro Rata Share of the Preferred Stock for the
price and upon the general terms and conditions specified in the Company's
notice by giving written notice to the Company stating the number of shares of
Preferred Stock to be so purchased, which notice will be effective only if
actually received by the Company in such 30-day period or if the Company refuses
to accept delivery of the notice in such 30-day period. In the event the Lender
fails to exercise the foregoing purchase right with respect to any Preferred
stock within such 30-day period, the Company may thereafter sell any or all of
such Preferred Stock not agreed to be purchased by the Lender at the same price
and upon substantially the same terms as those specified in the notice given to
the Lender.

4.       PREPAYMENT.

         4.1 RIGHT OF PREPAYMENT. This Note may be prepaid, in whole or in part,
at any time by the Company without premium or penalty. Any prepayment pursuant
to this Section 4 shall be accompanied by payment of any Interest (which may be
paid in cash, Common Stock, or a combination of cash and Common Stock as
provided in Section 2.2) and Default Interest, if any, accrued and unpaid
through the date of such prepayment.

         4.2 PROCEDURE FOR PREPAYMENT. In the event the Company elects to prepay
all or a portion of this Note, the Company shall mail a notice of prepayment
(the "Prepayment Notice") to Lender, certified mail, return receipt requested,
not later than the 30th day before the date fixed for prepayment (the
"Prepayment Date"), at Lender's address as shall appear on the Company's books.
The Prepayment Notice shall specify (i) the amount of this Note to be prepaid,
(ii) the Prepayment Date, (iii) the place where this Note shall be delivered,
and (iv) that the right to convert this Note pursuant to Section 5 shall
terminate at 5:00 p.m. (Colorado time) on the business day immediately preceding
the Prepayment Date. Any right to convert this Note into Common Stock with
respect to the amount to be prepaid shall terminate at 5:00 p.m. (Colorado time)
on the business day immediately preceding the Prepayment Date. On and after the
Prepayment Date, Lender shall have no further rights under this Note except to
receive, upon surrender of this Note, the amount of the prepayment and if the
prepayment does not pay in full all Principal, Interest, and Default Interest a
new Note for the balance not converted. From and after the Prepayment Date, the
Company shall, at the place specified in the Prepayment Notice, upon
presentation and surrender to the Company by or on behalf of Lender deliver or
cause to be delivered to or upon the written order of Lender a sum in cash equal
to the prepayment amount for this Note so presented and surrendered and if the
prepayment does not pay in full all Principal, Interest, and Default Interest a
new Note for the balance not converted.

                                      -4-
<PAGE>

         4.3 REGISTRATION UPON CONVERSION. In the event Lender elects to convert
all or any portion of this Note pursuant to Section 5 after Lender receives the
Prepayment Notice, Lender shall have the registration rights provided in the
Registration Rights Agreement dated ________________, 2003 by the Company.

5.       CONVERSION.

         5.1 RIGHT TO CONVERT. At any time and from time to time, Lender may,
elect to receive shares of Common Stock in lieu of payment of that portion of
Principal, Interest, and Default Interest specified in such notice.

         5.2 PROCEDURE. In order to make such election, Lender shall deliver to
the Company this Note and a written notice, in substantially the form of the
Conversion Notice attached hereto, of Lender's election to convert this Note,
which notice shall specify the amount of Principal, Interest, and Default
Interest to be converted and shall be effective only upon actual receipt by the
Company or upon the Company's refusal to accept delivery of the notice. Upon
such election, the Company shall issue to Lender (a) a certificate representing
the number of shares of Common Stock equal to (i) the dollar amount of
Principal, Interest, and Default Interest that Lender so elects to convert,
DIVIDED BY (ii) the Conversion Price (as defined in Section 6.4) and (b) if only
a portion of the Principal, Interest, and Default Interest shall be converted, a
new Note evidencing the Principal not converted, which new Note shall in all
other respects be identical with this Note, together with appropriate notation
about accrued and unpaid Interest or Default Interest; PROVIDED, HOWEVER, that
such issuance does not violate any federal or state securities laws or
regulation. Upon the issuance of such Common Stock, amounts owing by the Company
to Lender (including, without limitation, Principal, Interest and Default
Interest) that are not converted shall remain outstanding in accordance with the
terms of this Note. Such certificate and, if applicable, such replacement Note
shall be deemed to have been issued, and Lender shall be deemed for all purposes
to have become holders of record as of the date the aforementioned notice is
received by the Company or the Company refuses to accept delivery of the notice.
The Company shall pay all expenses, payable in connection with the preparation,
issuance and delivery of Share certificates and new Notes.

         5.3 FULLY PAID; FRACTIONAL SHARES. All Common Stock issued upon the
conversion of this Note shall be validly issued, fully paid and nonassessable
and the Company shall at all times reserve and keep available out of its
authorized shares of Common Stock a sufficient number of Shares for the purpose
of issuance upon the conversion of this Note. The Company shall not be required
to issue fractions of Shares upon conversion of this Note. If any fraction of a
Share would, but for this Section 5.3, be issuable upon any conversion of this
Note, in lieu of such fractional Share the Company, shall pay to Lender the
amount of Principal, Interest, or Default Interest that would result in such
fractional share.

6. COMMON STOCK.

         6.1 COMMON STOCK. As used in this Note, "Common Stock" shall mean the
Company's Common Stock, par value $.01 per share, subject to adjustment as
provided in Section 6.5.

                                      -5-
<PAGE>

         6.2 RESTRICTIONS. Lender understands that Common Stock issued or
to-be-issued hereunder (the "SECURITIES") will be issued without registration
pursuant to the Securities Act of 1933, as amended (the "1933 Act") and without
registration pursuant to any state securities laws, in each case in reliance
upon an exemption from the registration requirements of the Act and such state
securities laws. As a result, Lender understands that any document or
certificate evidencing any of the Securities may contain a restrictive legend
substantially as follows:

                  THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ACQUIRED
                  WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
                  AMENDED (THE "1933 ACT"), OR OTHER APPLICABLE STATE SECURITIES
                  LAWS. NO TRANSFER OR SALE OF THESE SECURITIES OR ANY INTEREST
                  THEREIN MAY BE MADE EXCEPT UNDER AN EFFECTIVE REGISTRATION
                  STATEMENT UNDER THE 1933 ACT AND SAID STATE SECURITIES LAWS
                  COVERING SAID SECURITIES UNLESS THE ISSUER HAS RECEIVED AN
                  OPINION OF COUNSEL SATISFACTORY TO IT THAT SUCH TRANSFER OR
                  SALE DOES NOT REQUIRE REGISTRATION UNDER THE 1933 ACT OR SAID
                  STATE SECURITIES LAWS.

Lender further agrees that if any transfer or distribution of any Securities is
proposed to be made otherwise than pursuant to registration under the 1933 Act
and applicable state securities laws, such action shall be taken only after
submission to the Company of an opinion of counsel, reasonably satisfactory in
form and substance to the Company's counsel, to the effect that the proposed
transfer or distribution will not be in violation of the Act or of applicable
state securities laws.

         6.3 NO RIGHTS AS STOCKHOLDER. This Note does not entitle Lender to any
rights whatsoever as a stockholder of the Company. PROVIDED, HOWEVER, Lender
shall have the same rights to review the books and records of the Company as
would a stockholder of the Company under the General Corporation Law of the
State of Delaware.

         6.4 CONVERSION PRICE. For purposes of converting Principal, Interest,
or Default Interest into Common Stock pursuant to Section 5.1 and payment of
Interest in shares of Common Stock pursuant to Section 2.2, the Conversion Price
is $0.25, such that for each $0.25 of Principal, Interest, or Default Interest
to be converted or paid, it will be converted or paid by one share of Common
Stock. The Conversion Price shall be subject to adjustment from time to time as
provided in Section 6.5.

         6.5      ADJUSTMENTS TO CONVERSION PRICE FOR DILUTING ISSUES.

                  (a) SPECIAL DEFINITIONS. For purposes of this Section 6.5, the
following definitions shall apply:

                                      -6-
<PAGE>

                  (1) "OPTION" shall mean rights, options, or warrants to
subscribe for, purchase or otherwise acquire either Common Stock or Convertible
Securities.

                  (2) "ORIGINAL ISSUE DATE" shall mean the date on which the
first Convertible Note was issued pursuant to the Private Placement Memorandum.

                  (3) "CONVERTIBLE SECURITIES" shall mean any evidences of
indebtedness, shares (other than Convertible Notes), or other securities
directly or indirectly convertible into or exchangeable for Common Stock.

                  (4) "ADDITIONAL SHARES OF COMMON STOCK" shall mean all shares
of Common Stock issued (or, pursuant to Section 6.5(c), deemed to be issued) by
the Company after the Original Issue Date, other than shares of Common Stock
issued or issuable (or so deemed to be issued):

                           [A] upon the issue of any Common Stock or the
Convertible Notes (including Common Stock issued upon conversion of any
Convertible Note or in payment of any interest under any Convertible Note)
pursuant to the Offering described in the Private Placement Memorandum;

                           [B] upon issue of any Common Stock or upon issue or
exercise of any options to officers, directors or employees of, or consultants
to, the Company pursuant to any stock Option, incentive, employment or
consulting, bonus or compensation program or agreement so long as any such
shares do not exceed at any time up to an aggregate of 20% of the issued and
outstanding shares of Common Stock (excluding any shares issued before the
Original Issue Date) and so long as with respect to any Options issued after the
Original Issue Date, the exercise price is not below $.50 per share;

                           [C] upon exercise of any Options issued prior to the
Original Issue Date or upon issue or exercise of any Options issued upon the
exercise of any warrants issued prior to the Original Issue Date;

                           [D] by way of dividend or other distribution on
shares Common Stock excluded from the definition of Additional Shares of Common
Stock by the foregoing clauses [A], [B], [C], or this clause [D] or on shares of
Common Stock so excluded; or

                           [E] for which adjustment is made in the Conversion
Price pursuant to Section 6.5(f).

                  (b) NO ADJUSTMENT OF CONVERSION PRICE. No adjustment in the
Conversion Price shall be made in respect of the issuance of Additional Shares
of Common Stock or otherwise, unless the consideration per share for such
Additional Shares of Common Stock issued or deemed to be issued by the Company
is less than the Conversion Price in effect on the date of, and immediately
prior to, the issue of such Additional Shares.

                                      -7-
<PAGE>

                  (c) ISSUE OF OPTIONS AND CONVERTIBLE SECURITIES DEEMED ISSUE
OF ADDITIONAL SHARES OF COMMON STOCK. In the event the Company at any time or
from time to time after the Original Issue Date shall issue any Options or
Convertible Securities or shall fix a record date for the determination of
holders of any class of securities entitled to receive any such Options or
Convertible Securities, then the maximum number of shares (as set forth in the
instrument relating thereto without regard to any provisions contained therein
for a subsequent adjustment of such number) of Common Stock issuable upon the
exercise of such Options or, in the case of Convertible Securities and Options
therefor, the conversion or exchange of such Convertible Securities, shall
(except as provided in Section 6.5(a)(4)) be deemed to be Additional Shares of
Common Stock issued as of the time of such issue or, in case such a record date
shall have been fixed, as of the close of business on such record date, provided
that Additional Shares of Common Stock shall not be deemed to have been issued
unless the consideration per share (determined pursuant to Section 6.5(e)) of
such Additional Shares of Common Stock would be less than the Conversion Price
in effect on the date of and immediately prior to such issue, or such record
date, as the case may be, and provided further that in any such case in which
Additional Shares of Common Stock are deemed to be issued:

                  (1) no further adjustment in the Conversion Price shall be
made upon the subsequent issue of Convertible Securities or shares of Common
Stock upon the exercise of such Options or conversion or exchange of such
Convertible Securities;

                  (2) if such Options or Convertible Securities by their terms
provide, with the passage of time or otherwise, for any increase in the
consideration payable to the Company, or decrease in the number of shares of
Common Stock issuable, upon the exercise, conversion or exchange thereof, the
Conversion Price computed upon the original issue thereof (or upon the
occurrence of a record date with respect thereto), and any subsequent
adjustments based thereon, shall, upon any such increase or decrease becoming
effective, be recomputed to reflect such increase or decrease insofar as it
affects such Options or the rights of conversion or exchange under such
Convertible Securities;

                  (3) upon the expiration of any such Options or any rights of
conversion or exchange under such Convertible Securities which shall not have
been exercised, the Conversion Price computed upon the original issue thereof
(or upon the occurrence of a record date with respect thereto) and any
subsequent adjustments based thereon shall, upon such expiration, be recomputed
as if:

                           [A] in the case of Convertible Securities or Options
for Common Stock, the only Additional Shares of Common Stock issued were the
shares of Common Stock, if any, actually issued upon the exercise of such
Options or the conversion or exchange of such Convertible Securities and the
consideration received therefor was the consideration actually received by the
Company for the issue of all such Options, whether or not exercised, plus the
consideration actually received by the Company upon such exercise, or for the
issue of all such Convertible Securities which were actually converted or
exchanged, plus the additional consideration, if any, actually received by the
Company upon such conversion or exchange, and

                                      -8-
<PAGE>

                           [B] in the case of Options for Convertible
Securities, only the Convertible Securities, if any, actually issued upon the
exercise thereof were issued at the time of issue of such Options, and the
consideration received by the Company for the Additional Shares of Common Stock
deemed to have been then issued was the consideration actually received by the
Company for the issue of all such Options, whether or not exercised, plus the
consideration deemed to have been received by the Company (determined pursuant
to Section 6.5(e)) upon the issue of the Convertible Securities with respect to
which such Options were actually exercised;

                  (4) no readjustment pursuant to clause (1) or (2) above shall
have the effect of increasing the Conversion Price to an amount which exceeds
the lower of [A] the Conversion Price on the original adjustment date, or [B]
the Conversion Price that would have resulted from any issuance of Additional
Shares of Common Stock between the original adjustment date and such
readjustment date;

                  (5) in the case of any Options which expire by their terms not
more than thirty (30) days after the date of issue thereof, no adjustment of the
Conversion Price shall be made until the expiration or exercise of all such
Options, whereupon such adjustment shall be made in the same manner provided in
clause (3) above; and

                  (6) if such record date shall have been fixed and such Options
or Convertible Securities are not issued on the date fixed therefor, the
adjustment previously made in the Conversion Price which became effective on
such record date shall be cancelled as of the close of business on such record
date, and thereafter the Conversion Price shall be adjusted pursuant to this
Section 6.5(c) as of the actual date of their issuance.

         (d) ADJUSTMENT OF CONVERSION PRICE UPON ISSUANCE OF ADDITIONAL SHARES
OF COMMON STOCK. In the event the Company shall issue Additional Shares of
Common Stock (including Additional Shares of Common Stock deemed to be issued
pursuant to Section 6.5(c)) without consideration or for a consideration per
share less than the Conversion Price in effect on the date of and immediately
prior to such issue, then and in such event, the Conversion Price shall be
reduced, concurrently with such issue, to an amount (calculated to the nearest
cent) determined by multiplying such Conversion Price in effect immediately
prior to such issuance by a fraction, (x) the numerator of which shall be (A)
the number of shares of Common Stock outstanding immediately prior to such issue
(including shares of Common Stock issuable upon conversion of any outstanding
Convertible Notes and Convertible Securities and the exercise of any Options,
except for Options excluded from the definition of "Additional Shares of Common
Stock" under Section 6.5(a)(4)), plus (B) the number of shares of Common Stock
which the net aggregate consideration, if any, received by the Company for the
total number of such additional shares of Common Stock so issued would purchase
at such Conversion Price in effect immediately prior to such issuance, and (y)
the denominator of which shall be (A) the number of shares of Common Stock
outstanding immediately prior to such issue (including shares of Common Stock
issuable upon conversion of any outstanding Preferred Stock and Convertible
Securities and the exercise of any Options (except for Options excluded from the
definition of "Additional Shares of Common Stock" under Section 6.5(a)(4)), plus
(B) the total number of such Additional Shares of Common Stock so issued.

                                      -9-
<PAGE>

         (e) DETERMINATION OF CONSIDERATION. For purposes of this Section 6.5,
the consideration received by the Company for the issue of any Additional Shares
of Common Stock shall be computed as follows:

                  (1) CASH AND PROPERTY. Such consideration shall:

                           [A] insofar as it consists of cash, be computed at
the aggregate amount of cash received by the Company excluding amounts paid or
payable for accrued interest or accrued dividends;

                           [B] insofar as it consists of property other than
cash, be computed at the fair value thereof at the time of such issue, as
determined in good faith by the Board of Directors; and

                           [C] in the event Additional Shares of Common Stock
are issued together with other shares or securities or other assets of the
Company for consideration which covers both, be the proportion of such
consideration so received, computed as provided in clauses [A] and [B] above, as
determined in good faith by the Board of Directors.

                  (2) OPTIONS AND CONVERTIBLE SECURITIES. The consideration per
share received by the Company for Additional Shares of Common Stock deemed to
have been issued pursuant to Section 6.5(c), relating to Options and Convertible
Securities, shall be determined by dividing (x) the total amount, if any,
received or receivable by the Company as consideration for the issue of such
Options or Convertible Securities, plus the minimum aggregate amount of
additional consideration (as set forth in the instruments relating thereto,
without regard to any provision contained therein for a subsequent adjustment of
such consideration until such subsequent adjustment occurs) payable to the
Company upon the exercise of such Options or the conversion or exchange of such
Convertible Securities or in the case of Options for Convertible Securities, the
exercise of such Options for Convertible Securities and the conversion or
exchange of such Convertible Securities, by (y) the maximum number of shares of
Common Stock (as set forth in the instruments relating thereto, without regard
to any provision contained therein for a subsequent adjustment of such number
until such subsequent adjustment occurs) issuable upon the exercise of such
Options or the conversion or exchange of such Convertible Securities.

         (f) ADJUSTMENT FOR DIVIDENDS, ETC.

                  (1) STOCK DIVIDENDS, DISTRIBUTIONS, OR SUBDIVISIONS. In the
event the Company at any time or from time to time after the Original Issue Date
shall declare or pay any dividend or make any other distribution on the Common
Stock payable in Common Stock, or effect a subdivision of the outstanding shares
of Common Stock (by reclassification or otherwise than by payment of a dividend
in Common Stock), then and in any such event, the Conversion Price shall be
proportionately decreased to reflect such dividend, distribution or subdivision
as of: [A] in the case of any such dividend or distribution, immediately after
the close of business on the record date for the determination of holders of any
class of securities entitled to receive such dividend or distribution, or [B] in

                                      -10-
<PAGE>

the case of any such subdivision, at the close of business on the date
immediately prior to the date upon which such corporate action becomes
effective. If such record date or other effective date shall have been fixed and
such dividend, distribution or subdivision shall not have been fully paid or
effected on the date fixed therefor, the adjustment previously made in the
Conversion Price which became effective on such record date or other date shall
be cancelled as of the close of business on such record date or other date, and
thereafter the Conversion Price shall be adjusted pursuant to this Section
6.5(c) as of the time of actual payment of such dividend, distribution or
effectiveness of such subdivision.

                  (2) COMBINATIONS OR CONSOLIDATIONS. In the event the
outstanding shares of Common Stock shall be combined or consolidated, by
reclassification or otherwise, into a lesser number of shares of Common Stock,
the Conversion Price in effect immediately prior to such combination or
consolidation shall, concurrently with the effectiveness of such combination or
consolidation, be proportionately increased.

         (g) ADJUSTMENT FOR MERGER OR REORGANIZATION. In case of any capital
reorganization or reclassification of the capital stock of the Company (other
than a reclassification covered by Section 6.5(f)(2)), the Principal, Interest,
and Default Interest shall thereafter be convertible into and Interest shall be
payable by the number of shares of stock or other securities or property to
which a holder of the number of shares of Common Stock would be entitled upon
such reorganization or reclassification. In any such case, appropriate
adjustment (as determined by the Board of Directors) shall be made in the
application of these provisions set forth with respect to the rights and
interest thereafter of the Lender, to the end that these provisions (including
provisions with respect to changes in and other adjustments of the Conversion
Price) shall thereafter be applicable, as nearly as reasonably may be, in
relation to any shares of stock or other property thereafter deliverable upon
the conversion of Principal, Interest, and Default Interest or the payment of
Interest.

         6.6 MINIMAL ADJUSTMENTS. No adjustment in the Conversion Price need be
made if such adjustment would result in a change in the Conversion Price of less
than $0.0001. Any adjustment of less than $0.0001 which is not made shall be
carried forward and shall be made at the time of and together with any
subsequent adjustment which, on a cumulative basis, amounts to an adjustment of
$0.0001 or more in the Conversion Price.

         6.7 CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Conversion Price pursuant to Section 6.5, the
Company at its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and prepare and furnish to the Lender a
certificate setting forth such adjustment or readjustment and showing in detail
the facts upon which such adjustment or readjustment is based. The Company
shall, upon written request at any time of the Lender, furnish or cause to be
furnished to the Lender a like certificate setting forth (a) such adjustments
and readjustments, (b) the Conversion Price at the time in effect, and (c) the
number of shares of Common Stock and the amount, if any, of other property which
at the time would be received upon the conversion of Principal, Interest, or
Default Interest or the payment of Interest.

                                      -11-
<PAGE>

7. RESTRICTIONS ON TRANSFER.

         7.1 OWNERSHIP OF NOTE. The Company may deem and treat the Lender as the
holder and owner hereof (notwithstanding any notations of ownership or writing
hereon made by any person other than the Company) for all purposes and shall not
be affected by any notice to the contrary, until presentation of this Note for
registration of transfer as provided in this Section 7.

         7.2 TRANSFER OF NOTE. The Company agrees to maintain books for the
registration of transfers of this Note and all rights hereunder shall be
registered, in whole or in part, on such books, upon surrender of this Note to
the Company, together with a written assignment of this Note duly executed by
Lender or its duly authorized agent or attorney. Subject to applicable law and
regulation and Section 7 of this Note, upon surrender of this Note as provided
for herein, the Company shall execute and deliver a new Note in the name of the
assignee or assignees, and this Note shall promptly be canceled.

         7.3 RESTRICTIONS ON TRANSFER. Lender, by its acceptance hereof,
represents that this Note is being acquired for Lender's own account, as an
investment and not with a view towards the further resale or the distribution
thereof in violation of the Securities Act, and agrees that this Note may not be
transferred, sold, assigned, hypothecated or otherwise disposed of, in whole or
in part, except as provided in the legend on the first page hereof and provided
that Lender shall have furnished to the Company an opinion of Lender's Counsel,
in form and substance reasonably satisfactory to the Company, to the effect that
such transfer is exempt from the registration requirements of the Securities Act
and any applicable state securities laws.

8. EVENTS OF DEFAULT AND REMEDIES.

         8.1 EVENTS OF DEFAULT. The following shall constitute events of default
hereunder (an "EVENT OF DEFAULT"): (i) a default in the payment of any amounts
due hereunder occurring on or prior to the Maturity Date and such default is not
cured within 10 days of the date such payment is due; (ii) a default by the
Company in the performance of its obligations under Section 3.1; (iii) a default
by the Company in the performance of any covenant (other than those provided in
(i) and (ii)) under this Note and such default is not cured within 30 days of
the date it occurs; (iv) any representation or warranty made by the Company
contained in the Subscription Agreement and Questionnaire of Lender pursuant to
which this Note was issued shall prove to have been incorrect in any material
respect when made; (v) any assignment for the benefit of creditors by the
Company; (vi) the appointment of a receiver for the Company or for a substantial
portion of the property of the Company unless such appointment shall be
dismissed within 90 days of the filing thereof; (vii) the filing of a petition
in bankruptcy by or against the Company unless such filing shall be dismissed
within 90 days thereof; or (viii) the termination of existence or dissolution of
the Company.

         8.2. ACCELERATION. Notwithstanding anything to the contrary contained
herein, upon the occurrence of an Event of Default, then upon the determination
of Lender (in Lender's discretion), and without further demand or notice of any
kind, the following shall become immediately due and payable: (i) the Principal;
(ii) unpaid Interest; (iii) any unpaid Default Interest; and (iv) all other
indebtedness evidenced by this Note.

                                      -12-
<PAGE>

         8.3 GENERAL. Upon the occurrence of an Event of Default, Lender shall
have all of the rights and remedies provided to Lender: (i) under this Note, and
(ii) otherwise at law or in equity. The remedies of Lender, as provided in this
Note, shall be cumulative and concurrent, and may be pursued singularly,
successively, or together, at the sole discretion of Lender, and may be
exercised as often as occasion therefor shall arise. No act or omission of
Lender, including specifically any failure to exercise any right, remedy or
recourse, shall be deemed to be a waiver or release of the same, such waiver or
release to be effected only through a written document executed by Lender and
then only to the extent specifically recited therein. A waiver or release with
reference to any one event shall not be construed as continuing, as a bar to, or
as a waiver or release of, any subsequent right, remedy, or recourse as to a
subsequent event.

         8.4 COSTS AND FEES. If this Note is placed in the hands of an attorney
for collection or is collected through any legal proceeding, the Company
promises to pay, to the extent permitted by law, court costs and reasonable
attorneys' fees incurred by Lender, and all such amounts shall thereafter
constitute other indebtedness evidenced by this Note.

         8.5 WAIVERS. Every person and/or entity now or at any time liable,
whether primarily or secondarily, for the payment of the indebtedness evidenced
hereby, for such person and/or entity and for the heirs, legal representatives,
successors, and assigns of such person and/or entity, expressly waives
presentment for payment, notice of dishonor, protest, notice of protest, and
diligence in collection, and further waives for the benefit of itself and such
other parties, to the extent permitted by law, the benefit of all appraisement,
valuation, marshaling, forbearance, stay, extension, redemption, homestead,
exemption, and moratorium laws now or hereafter in force, and agrees that the
time of payment of Principal, Interest, or Default Interest may be extended,
without in any way modifying, altering, releasing, affecting, or limiting his,
her, or its liability hereunder.

         8.6 APPLICATION OF PAYMENTS. After the Maturity Date or following the
occurrence of an Event of Default, all payments received on account of the
indebtedness evidenced hereby shall be applied, in whatever order, combination
and amounts as Lender, in its sole discretion, decide, to all costs, expenses,
and other indebtedness, if any, owing to Lender by reason of this Note, Default
Interest, Interest, and Principal.

9.       MISCELLANEOUS.

         9.1 SEVERABILITY. If any provision of this Note is unenforceable,
invalid or contrary to law, or its inclusion herein would affect the validity,
legality, or enforcement of this Note, such provision shall be limited to the
extent necessary to render the same valid or shall be excised from this Note, as
the circumstances require, and this Note shall be construed as if said provision
had been incorporated herein as so limited or as if said provision had not been
included herein, as the case may be.

         9.2 BINDING EFFECT. This Note, and the terms and provisions hereof,
shall be binding upon the Company and its successors, administrators, and
assigns, and shall inure to the benefit of' Lender.

                                      -13-
<PAGE>

         9.3 GOVERNING LAW. This Note shall be governed by and construed in
accordance with the internal laws of the State of New York without reference to
(i) its judicially or statutorily pronounced rules regarding conflict of laws or
choice of law; (ii) where any instrument is executed or delivered; (iii) where
any payment or other performance required by any such instrument is made or
required to be made; (iv) where any breach of any provision of any such
instrument occurs, or any cause of action otherwise accrues; (v) where any
action or other proceeding is instituted or pending; (vi) the nationality,
citizenship, domicile, principal place of business, or jurisdiction or
organization or domestication of any party; (vii) whether the laws of the form
jurisdiction otherwise would apply the laws of a jurisdiction other than the
State of New York; or (viii) any combination of the foregoing.

         9.4 NOTICE. Any notice or other communication to be given hereunder
shall be in writing and, unless otherwise provided in this Note, shall be shall
be conclusively deemed given if deposited in the United States mail, postage
prepaid, and addressed to the recipient at the address set forth below (or at
such other address as Lender or the Company shall by notice specify to the
other).

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

                                  Performance Health Technologies, Inc.

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

                                      Notice Address:
[Insert Lender's Address]             427 Riverview Plaza
                                      Trenton, NJ 08611
---------------------------------

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

                                      -14-
<PAGE>

                               CONVERSION ELECTION
                    (To be executed upon conversion of Note)

To:  Performance Health Technologies, Inc. (the "Company")

         Lender hereby irrevocably elects to convert Lender's rights represented
by this Note to purchase _______ shares of Common Stock issuable upon the
conversion of this Note and requests that certificates for such securities shall
be issued in the name of Lender and be delivered to

                     (please print or type name and address)

and if such number of shares of Common Stock shall not be all the shares that
may be acquired pursuant to the conversion of this Note that a new Note for the
balance not converted be registered in the name of and delivered to Lender at
the address stated above.

In connection with the conversion of the Note, Lender hereby represents and
warrants that: (i) Lender recognizes that the Common Stock issuable pursuant to
the attached Note have not been registered under the Securities Act and may not
be sold, pledged or otherwise transferred except pursuant to the exceptions set
forth on the legend on the Common Stock which is also set forth in Section 7 of
the attached Note; (ii) Lender has received all material information with
respect to the Company which Lender deems necessary with its decision to convert
the attached Note and Lender has been given an opportunity to ask questions and
receive answers from representatives of the Company; (iii) Lender is purchasing
the Common Stock for Lender's own account, for the purpose of investment only,
and not with a view towards the further resale or distribution thereof; and (iv)
Lender is an "Accredited Investor" within the meaning of Rule 501 of Regulation
D under the Securities Act of 1933, as amended.

Dated: ________________

                                  ----------------------------------------------
                                   NOTE: The above signatory should correspond
                                   exactly with the name on the face of the
                                   attached Note.

                                  ----------------------------------------------
                                   Taxpayer Identification Number

                                  ----------------------------------------------
                                   Signature Guaranteed

                                      -15-
<PAGE>

                                   ASSIGNMENT
                    (To be executed upon assignment of Note)

For value received and in accordance with Section 7 of the attached Note,
____________________ hereby sells, assigns and transfers unto ____________ the
attached Note, together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint __________________ attorney to
transfer said Note on the books of Performance Health Technologies, Inc. with
full power of substitution in the premises.

Dated: ____________________

                                  ----------------------------------------------
                                   NOTE: The above signatory should correspond
                                   exactly with the name on the face of the
                                   attached Note.

                                  ----------------------------------------------
                                   Signature Guaranteed

Consented to and approved in accordance with
Section 7 of the attached Note

PERFORMANCE HEALTH TECHNOLOGIES, INC.

By:
      ----------------------------------------
Name:
      ----------------------------------------
Its:
      ----------------------------------------

                                      -16-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}]]