Document:

THIS NOTE AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS.  THIS NOTE AND THE COMMON SHARES ISSUABLE UPON
CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO
THIS NOTE UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO ON THE GO HEALTHCARE, INC.
THAT SUCH REGISTRATION IS NOT REQUIRED.

                 SECURED CONVERTIBLE MINIMUM BORROWING NOTE

FOR VALUE RECEIVED, ON THE GO HEALTHCARE, INC., a Delaware corporation (the
"Borrower") promises to pay to LAURUS MASTER FUND, LTD., c/o M&C Corporate
Services Limited, P.O. Box 309 GT, Ugland House, South Church Street, George
Town, Grand Cayman, Cayman Islands, Fax: 345-949-8080 (the "Holder") or its
registered assigns or successors in interest, on order, the sum of Two
Million five Hundred Thousand Dollars ($2,500,000), or, if different, the
aggregate principal amount of all Loans (as defined in the Security Agreement
referred to below), together with any accrued and unpaid interest hereon,
on July 14, 2008 (the "Maturity Date") if not sooner paid.

Capitalized terms used herein without definition shall have the meanings
ascribed to such terms in the Security and Purchase Agreement between the
Borrower and the Holder dated as of the date hereof (as amended, modified
and/or supplemented from time to time, the "Security Agreement").

The following terms shall apply to this Minimum Borrowing Note (this "Note"):

                                  Article I

CONTRACT RATE

1.1 Contract Rate.  Subject to Sections 4.2 and 5.11, interest payable on the
    outstanding principal amount of this Note (the "Principal Amount") shall
    accrue at a rate per annum equal to the "prime rate" published in The Wall
    Street Journal from time to time (the "Prime Rate"), plus two percent (2%)
    (the "Contract Rate").  The Contract Rate shall be increased or decreased
    as the case may be for each increase or decrease in the Prime Rate in an
    amount equal to such increase or decrease in the Prime Rate; each change
    to be effective as of the day of the change in the Prime Rate.  Subject to
    Section 1.2, the Contract Rate shall not at any time be less than eight
    percent (8%).  Interest shall be (i) calculated on the basis of a 360 day
    year, and (ii) payable monthly, in arrears, commencing on August 1, 2005
    on the first business day of each consecutive calendar month thereafter
    through and including the Maturity Date and on the Maturity Date, whether
    by acceleration or otherwise.

1.2 Contract Rate Adjustments and Payments.  The Contract Rate shall be
    calculated on the last business day of each calendar month hereafter (other
    than for increases or decreases in the Prime Rate which shall be calculated
    and become effective in accordance with the terms of Section 1.1) until
    the Maturity Date (each a "Determination Date") and shall be subject to
    adjustment as set forth herein.  If (i) the Borrower shall have registered
    the shares of the Common Stock underlying the conversion of each Minimum
    Borrowing Note and each Warrant on a registration statement declared
    effective by the Securities and Exchange Commission (the "SEC"), and
    (ii) the market price (the "Market Price") of the Common Stock as
    reported by Bloomberg, L.P. on the Principal Market for the five (5)
    trading days immediately preceding a Determination Date exceeds the
    then applicable Fixed Conversion Price by at least twenty-five percent
    (25%), the Contract Rate for the succeeding calendar month shall
    automatically be reduced by 200 basis points (200 b.p.) (2%) for each
    incremental twenty-five percent (25%) increase in the Market Price of
    the Common Stock above the then applicable Fixed Conversion Price.
    Notwithstanding the foregoing (and anything to the contrary contained
    herein), in no event shall the Contract Rate at any time be less than
    zero percent.

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1.3 Currency.  All principal, interest and other amounts owing under this
    Note, the Security Agreement or any Ancillary Agreement that, in accordance
    with their terms, are to be paid in cash shall be paid in US dollars.
    All amounts denominated in other currencies shall be converted to the
    US dollar equivalent amount in accordance with the Exchange Rate on the
    date of calculation. "Exchange Rate" means, in relation to any amount of
    currency to be converted into US dollars pursuant to this Note, the
    Security Agreement or any Ancillary Agreement, the US dollar exchange
    rate as published in the Wall Street Journal on the relevant date of
    calculation.

1.4 Taxes.

        (a) If permissible by law, any and all payments by the Borrower
            hereunder, including any amounts received on a conversion or
            redemption of the Note and any amounts on account of interest
            or deemed interest, shall be made free and clear of and without
            deduction for any and all present or future taxes, levies,
            imposts, deductions, charges or withholdings, and all liabilities
            with respect thereto, excluding taxes imposed on net income or
            franchise taxes of the Holder by the jurisdiction in which such
            person is organized or has its principal office (all such
            non-excluded taxes, levies, imposts, deductions, charges
            withholdings and liabilities, collectively or individually,
            "Taxes").  If the Borrower shall be required to deduct any
            Taxes from or in respect of any sum payable hereunder to the
            Holder, (i) the sum payable shall be increased by the amount
            (an "additional amount") necessary so that after making all
            required deductions (including deductions applicable to additional
            sums payable under this Section 1.4) the Holder shall receive an
            amount equal to the sum it would have received had no such
            deductions been made, (ii) the Borrower shall make such deductions
            and (iii) the Borrower shall pay the full amount deducted to the
            relevant governmental authority in accordance with applicable law.

        (b) In addition, the Borrower agrees to pay to the relevant
            governmental authority in accordance with applicable law any
            present or future stamp or documentary taxes or any other excise
            or property taxes, charges or similar levies that arise from any
            payment made hereunder or from the execution, delivery or
            registration of, or otherwise with respect to, this Note ("Other
            Taxes").  The Borrower shall deliver to the Holder official
            receipts, if any, in respect of any Taxes or Other Taxes payable
            hereunder promptly after payment of such Taxes or Other Taxes or
            other evidence of payment reasonably acceptable to the Holder.

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        (c) The Borrower hereby indemnifies and agrees to hold the Holder
            harmless from and against Taxes and Other Taxes (including, without
            limitation, Taxes and Other Taxes imposed on any amounts payable
            under this Section 1.4) paid by such person, whether or not such
            Taxes or Other Taxes were correctly or legally asserted.  Such
            indemnification shall be paid within ten (10) days from the date on
            which any such person makes written demand therefor specifying in
            reasonable detail the nature and amount of such Taxes or Other
            Taxes.

        (d) The obligations of the Borrower under this Section 1.4 shall
            survive the termination of this Note and the payment of this Note
            and all other amounts payable hereunder.

                                  Article II

LOANS; PAYMENTS UNDER THIS NOTE

2.1 Loans.  All Loans evidenced by this Note shall be made in accordance with
    the terms and provisions of the Security Agreement.

2.2 No Effective Registration.  Notwithstanding anything to the contrary
    herein, the Holder shall not be required to accept shares of Common Stock
    as payment following a conversion by the Holder if there fails to exist
    an effective current Registration Statement (as defined in the
    Registration Rights Agreement) covering the shares of Common Stock to
    be issued, or if an Event of Default hereunder exists and is continuing,
    unless such requirement is otherwise waived in writing by the Holder in
    whole or in part at the Holder's option.

2.3 Optional Redemption in Cash.  The Borrower will have the option of
    prepaying this Note ("Optional Redemption") by paying to the Holder a sum
    of money equal to one hundred thirty percent (130%) of the principal amount
    of this Note together with accrued but unpaid interest thereon and any
    and all other sums due, accrued or payable to the Holder arising under
    this Note, the Security Agreement, or any other Ancillary Agreement (the
    "Redemption Amount") outstanding on the Redemption Payment Date (as
    defined below).  The Borrower shall deliver to the Holder a written notice
    of redemption (the "Notice of Redemption") specifying the date for such
    Optional Redemption (the "Redemption Payment Date"), which date shall be
    seven (7) days after the date of the Notice of Redemption (the "Redemption
    Period").  A Notice of Redemption shall not be effective with respect to
    any portion of this Note for which the Holder has previously delivered a
    Notice of Conversion (defined below) pursuant to Section 3.1, or for
    conversions elected to be made by the Holder pursuant to Section 3.1
    during the Redemption Period.  The Redemption Amount shall be determined
    as if such Holder's conversion elections had been completed immediately
    prior to the date of the Notice of Redemption.  On the Redemption Payment
    Date, the Redemption Amount (plus any additional interest and fees
    accruing on the Notes during the Redemption Period) must be irrevocably
    paid in full in immediately available funds to the Holder.  In the event
    the Borrowers fail to pay the Redemption Amount on the Redemption Payment
    Date, then such Redemption Notice shall be null and void.

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                                  Article III

CONVERSION RIGHTS AND FIXED CONVERSION PRICE

3.1 Optional Conversion. Subject to the terms of this Article III, the Holder
    shall have the right, but not the obligation, at any time until the
    Maturity Date, or during an Event of Default (as defined in Article IV),
    and, subject to the limitations set forth in Section 3.2 hereof, to convert
    all or any portion of the outstanding Principal Amount and/or accrued
    interest and fees due and payable into fully paid and nonassessable shares
    of the Common Stock at the Fixed Conversion Price.  For purposes hereof,
    subject to Section 3.6 hereof, the initial "Fixed Conversion Price"
    means $1.02.  The shares of Common Stock to be issued upon such conversion
    are herein referred to as the "Conversion Shares."

3.2 Conversion Limitation.  Notwithstanding anything contained herein to the
    contrary, the Holder shall not be entitled to convert pursuant to the terms
    of this Note an amount that would be convertible into that number of
    Conversion Shares which would exceed the difference between (i) 4.99% of
    the outstanding shares of Common Stock and (ii) the number of shares of
    Common Stock beneficially owned by the Holder.  For purposes of the
    immediately preceding sentence, beneficial ownership shall be determined
    in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3
    thereunder.  The Conversion Shares limitation described in this Section 3.2
    shall automatically become null and void without any notice to any
    Borrower upon the occurrence and during the continuance of an Event of
    Default, or upon 75 days prior notice to the Company.  Notwithstanding
    anything contained herein to the contrary, the provisions of this
    Section 3.2 are irrevocable and may not be waived by the Holder or any
    Borrower. The Holder shall be solely responsible for determining its
    ownership pursuant to this Section 3.2.

3.3 Mechanics of Holder's Conversion.  In the event that the Holder elects
    to convert this Note into Common Stock, the Holder shall give notice of
    such election by delivering an executed and completed notice of conversion
    in substantially the form of Exhibit A hereto (appropriately completed)
    ("Notice of Conversion") to the Borrower and such Notice of Conversion
    shall provide a breakdown in reasonable detail of the Principal Amount,
    accrued interest and fees that are being converted.  On each Conversion
    Date (as hereinafter defined) and in accordance with its Notice of
    Conversion, the Holder shall make the appropriate reduction to the
    Principal Amount, accrued interest and fees as entered in its records
    and shall provide written notice thereof to the Borrower within two (2)
    Business Days after the Conversion Date.  Each date on which a Notice
    of Conversion is delivered or telecopied to the Borrower in accordance
    with the provisions hereof shall be deemed a Conversion Date (the
    "Conversion Date").  Pursuant to the terms of the Notice of Conversion,
    the Borrower will issue instructions to the transfer agent accompanied
    by an opinion of counsel within one (1) Business Day of the date of the
    delivery to the Borrower of the Notice of Conversion and shall cause the
    transfer agent to transmit the certificates representing the Conversion
    Shares to the Holder by crediting the account of the Holder's designated
    broker with the Depository Trust Corporation ("DTC") through its Deposit
    Withdrawal Agent Commission ("DWAC") system within three (3) Business
    Days after receipt by the Borrower of the Notice of Conversion (the
    "Delivery Date").  In the case of the exercise of the conversion rights
    set forth herein the conversion privilege shall be deemed to have been
    exercised and the Conversion Shares issuable upon such conversion shall
    be deemed to have been issued upon the date of receipt by the Borrower
    of the Notice of Conversion.  The Holder shall be treated for all
    purposes as the record holder of the Conversion Shares, unless the
    Holder provides the Borrower written instructions to the contrary.

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<PAGE>

3.4 Late Payments.  Each Borrower understands that a delay in the delivery
    of the Conversion Shares in the form required pursuant to this Article
    beyond the Delivery Date could result in economic loss to the Holder.
    As compensation to the Holder for such loss, in addition to all other
    rights and remedies which the Holder may have under this Note, applicable
    law or otherwise, the Borrowers shall, jointly and severally, pay late
    payments to the Holder for any late issuance of Conversion Shares in the
    form required pursuant to this Article III upon conversion of this Note,
    in the amount equal to $500 per Business Day after the Delivery Date.
    The Borrowers shall, jointly and severally, make any payments incurred
    under this Section in immediately available funds upon demand.

3.5 Conversion Mechanics.  The number of shares of Common Stock to be issued
    upon each conversion of this Note shall be determined by dividing that
    portion of the principal and interest and fees to be converted, if any,
    by the then applicable Fixed Conversion Price.

3.6 Adjustment Provisions. The Fixed Conversion Price and number and kind
    of shares or other securities to be issued upon conversion determined
    pursuant to Section 3.1 shall be subject to adjustment from time to time
    upon the occurrence of certain events during the period that this
    conversion right remains outstanding, as follows:

        (a) Reclassification.  If the Borrower at any time shall, by
            reclassification or otherwise, change the Common Stock into the
            same or a different number of securities of any class or classes,
            this Note, as to the unpaid Principal Amount and accrued interest
            thereon, shall thereafter be deemed to evidence the right to
            purchase an adjusted number of such securities and kind of
            securities as would have been issuable as the result of such
            change with respect to the Common Stock (i) immediately prior
            to or (ii) immediately after such reclassification or other
            change at the sole election of the Holder.

        (b) Stock Splits, Combinations and Dividends.  If the shares of Common
            Stock are subdivided or combined into a greater or smaller number
            of shares of Common Stock, or if a dividend is paid on the Common
            Stock or any preferred stock issued by the Borrower in shares of
            Common Stock, the Fixed Conversion Price shall be proportionately
            reduced in case of subdivision of shares or stock dividend or
            proportionately increased in the case of combination of shares,
            in each such case by the ratio which the total number of shares
            of Common Stock outstanding immediately after such event bears
            to the total number of shares of Common Stock outstanding
            immediately prior to such event.

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<PAGE>

        (c) Share Issuances.  Subject to the provisions of this Section 3.6,
            if the Borrower shall at any time prior to the conversion or
            repayment in full of the Principal Amount issue any shares of
            Common Stock or securities convertible into Common Stock to a
            person other than the Holder (except (i) pursuant to Sections
            3.6(a) or (b) above; (ii) pursuant to options, warrants, or
            other obligations to issue shares outstanding on the date hereof
            as disclosed to the Holder in writing;  (iii) pursuant to
            options that may be issued under any employee incentive stock
            option and/or any qualified stock option plan adopted by the
            Company) or (iv) Common Stock issued in connection with
            acquisitions approved by Laurus, which such approval shall not
            be unreasonably withheld, for a consideration per share (the
            "Offer Price") less than the Fixed Conversion Price in effect
            at the time of such issuance, then the Fixed Conversion Price
            shall be immediately reset to such lower Offer Price.  For
            purposes hereof, the issuance of any security of the Borrower
            convertible into or exercisable or exchangeable for Common
            Stock shall result in an adjustment to the Fixed Conversion
            Price upon the issuance of such securities.

        (d) Computation of Consideration.  For purposes of any computation
            respecting consideration received pursuant to Section 3.6(c)
            above, the following shall apply:

                (i) in the case of the issuance of shares of Common Stock
                    for cash, the consideration shall be the amount of
                    such cash, provided that in no case shall any deduction
                    be made for any commissions, discounts or other expenses
                    incurred by the Borrower for any underwriting of the
                    issue or otherwise in connection therewith;

                (ii) in the case of the issuance of shares of Common Stock
                     for a consideration in whole or in part other than cash,
                     the consideration other than cash shall be deemed to be
                     the fair market value thereof as determined in good
                     faith by the Board of Directors of the Borrower
                     (irrespective of the accounting treatment thereof); and

                (iii) upon any such exercise, the aggregate consideration
                      received for such securities shall be deemed to be the
                      consideration received by the Borrower for the issuance
                      of such securities plus the additional minimum
                      consideration, if any, to be received by the Borrower
                      upon the conversion or exchange thereof (the
                      consideration in each case to be determined in the same
                      manner as provided in subsections (i) and (ii) of this
                      Section 3.6(d)).

3.7 Reservation of Shares.  During the period the conversion right exists,
    the Borrower will reserve from its authorized and unissued Common Stock
    a sufficient number of shares to provide for the issuance of Conversion
    Shares upon the full conversion of this Note and the warrant.  The Borrower
    represents that upon issuance, the Conversion Shares will be duly and
    validly issued, fully paid and non-assessable.  The Borrower agrees that
    its issuance of this Note shall constitute full authority to its officers,
    agents, and transfer agents who are charged with the duty of executing and
    issuing stock certificates to execute and issue the necessary certificates
    for the Conversion Shares upon the conversion of this Note.

3.8 Registration Rights.  The Holder has been granted registration rights with
    respect to the Conversion Shares as set forth in a Registration Rights
    Agreement.

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                                  Article IV

EVENTS OF DEFAULT AND DEFAULT RELATED PROVISIONS

4.1 Events of Default.  The occurrence of an Event of Default under the
    Security Agreement shall constitute an event of default ("Event of
    Default") hereunder.

4.2 Default Interest.  Following the occurrence and during the continuance
    of an Event of Default, the Borrowers shall, jointly and severally,
    pay additional interest on the outstanding principal balance of this
    Note in an amount equal to two percent (2%) per month, and all
    outstanding Obligations, including unpaid interest, shall continue
    to accrue interest at such additional interest rate from the date of
    such Event of Default until the date such Event of Default is cured
    or waived.

4.3 Default Payment.  Following the occurrence and during the continuance
    of an Event of Default, the Holder, at its option, may elect, in
    addition to all rights and remedies of the Holder under the Security
    Agreement and the Ancillary Agreements and all obligations of each
    Borrower under the Security Agreement and the Ancillary Agreements,
    to require the Borrowers, jointly and severally, to make a Default
    Payment ("Default Payment").  The Default Payment shall be 130% of
    the outstanding principal amount of the Note, plus accrued but unpaid
    interest, all other fees then remaining unpaid, and all other amounts
    payable hereunder.  The Default Payment shall be applied first to any
    fees due and payable to the Holder pursuant to the Notes and/or the
    Ancillary Agreements, then to accrued and unpaid interest due on the
    Notes, the Security Agreement and then to the outstanding principal
    balance of the Notes.  The Default Payment shall be due and payable
    immediately on the date that the Holder has exercised its rights
    pursuant to this Section 4.3.

                                  Article V

MISCELLANEOUS

5.1 Conversion Privileges.  The conversion privileges set forth in
    Article III shall remain in full force and effect immediately from the
    date hereof until the date this Note is indefeasibly paid in full and
    irrevocably terminated.

5.2 Cumulative Remedies.  The remedies under this Note shall be cumulative.

5.3 Failure or Indulgence Not Waiver.  No failure or delay on the part of
    the Holder hereof in the exercise of any power, right or privilege
    hereunder shall operate as a waiver thereof, nor shall any single or
    partial exercise of any such power, right or privilege preclude other
    or further exercise thereof or of any other right, power or privilege.
    All rights and remedies existing hereunder are cumulative to, and not
    exclusive of, any rights or remedies otherwise available.

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<PAGE>

5.4 Notices.  Any notice herein required or permitted to be given shall
    be in writing and shall be deemed effectively given: (a) upon personal
    delivery to the party notified, (b) when sent by confirmed telex or
    facsimile if sent during normal business hours of the recipient, if
    not, then on the next business day, (c) five days after having been
    sent by registered or certified mail, return receipt requested,
    postage prepaid, or (d) one day after deposit with a nationally
    recognized overnight courier, specifying next day delivery, with
    written verification of receipt.  All communications shall be sent to
    the Borrower at the address provided for such Borrower in the Security
    Agreement executed in connection herewith, and to the Holder at the
    address provided in the Security Agreement for such Holder, with a copy
    to John E. Tucker, Esq., 825 Third Avenue, 14th Floor, New York, New
    York 10022, facsimile number (212) 541-4434, or at such other address
    as the respective Borrower or the Holder may designate by ten days
    advance written notice to the other parties hereto.  A Notice of
    Conversion shall be deemed given when made to the Borrower pursuant
    to the Purchase Agreement.

5.5 Amendment Provision.  The term "Note" and all references thereto, as
    used throughout this instrument, shall mean this instrument as
    originally executed, or if later amended or supplemented, then as so
    amended or supplemented, and any successor instrument as such successor
    instrument may be amended or supplemented.

5.6 Assignability.  This Note shall be binding upon each Borrower and its
    successors and assigns, and shall inure to the benefit of the Holder
    and its successors and assigns, and may be assigned by the Holder in
    accordance with the requirements of the Security Agreement.  No
    Borrower may assign any of its obligations under this Note without the
    prior written consent of the Holder, any such purported assignment
    without such consent being null and void.

5.7 Cost of Collection.  In case of any Event of Default under this Note,
    the Borrowers shall, jointly and severally, pay the Holder's reasonable
    costs of collection, including reasonable attorneys' fees.

5.8 Governing Law, Jurisdiction and Waiver of Jury Trial.

        (a) THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
            ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
            TO PRINCIPLES OF CONFLICTS OF LAW.

        (b) EACH BORROWER HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL
            COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL
            HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR
            DISPUTES BETWEEN ANY BORROWER, ON THE ONE HAND, AND THE HOLDER,
            ON THE OTHER HAND, PERTAINING TO THIS NOTE, THE SECURITY AGREEMENT
            OR ANY OF THE OTHER ANCILLARY AGREEMENTS OR TO ANY MATTER ARISING
            OUT OF OR RELATED TO THIS NOTE, THE SECURITY AGREEMENT OR ANY OF
            THE OTHER ANCILLARY AGREEMENTS; PROVIDED, THAT EACH BORROWER
            ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE
            HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE
            OF NEW YORK; AND FURTHER PROVIDED, THAT NOTHING IN THIS NOTE SHALL
            BE DEEMED OR OPERATE TO PRECLUDE THE HOLDER FROM BRINGING SUIT OR
            TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE

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            OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR
            THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN
            FAVOR OF THE HOLDER.  EACH BORROWER EXPRESSLY SUBMITS AND CONSENTS
            IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN
            ANY SUCH COURT, AND EACH BORROWER HEREBY WAIVES ANY OBJECTION WHICH
            IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER
            VENUE OR FORUM NON CONVENIENS.  EACH BORROWER HEREBY WAIVES
            PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED
            IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS,
            COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
            MAIL ADDRESSED TO THE BORROWERAT THE ADDRESS SET FORTH IN THE
            SECURITY AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED
            COMPLETED UPON THE EARLIER OF THE COMPANY'S ACTUAL RECEIPT
            THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER
            POSTAGE PREPAID.

        (c) EACH BORROWER DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE
            APPLYING SUCH APPLICABLE LAWS.  THEREFORE, TO ACHIEVE THE BEST
            COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF
            ARBITRATION, EACH BORROWER HERETO WAIVES ALL RIGHTS TO TRIAL BY
            JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY
            DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN
            THE HOLDER, AND/OR ANY BORROWER ARISING OUT OF, CONNECTED WITH,
            RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN
            THEM IN CONNECTION WITH THIS NOTE, THE SECURITY AGREEMENT, ANY
            OTHER ANCILLARY AGREEMENT OR THE TRANSACTIONS RELATED HERETO OR
            THERETO.

5.9 Judgment Currency.

        (a) If for the purpose of obtaining or enforcing judgment against the
            Borrower in any court in any jurisdiction it becomes necessary to
            convert into any other currency (such other currency being
            hereinafter in this Section 5.9 referred to as the "Judgment
            Currency") an amount due in US dollars under this Note, the
            conversion shall be made at the Exchange Rate prevailing on the
            business day immediately preceding:

                (i) the date actual payment of the amount due, in the case of
                    any proceeding in the courts of New York or in the courts
                    of any other jurisdiction that will give effect to such
                    conversion being made on such date: or

                (ii) the date on which the foreign court determines, in the
                     case of any proceeding in the courts of any other
                     jurisdiction (the date as of which such conversion is
                     made pursuant to this Section 5.9(a)(ii) being hereinafter
                     referred to as the "Judgment Conversion Date")

        (b) If in the case of any proceeding in the court of any jurisdiction
            referred to in Section 5.9(a)(a)(ii) above, there is a change in
            the Exchange Rate prevailing between the Judgment Conversion Date
            and the date of actual payment of the amount due, the applicable
            party shall pay such adjusted amount as may be necessary to ensure
            that the amount paid in the Judgment Currency, when converted at
            the Exchange Rate prevailing on the date of payment, will produce
            the amount of US dollars which could have been purchased with the
            amount of Judgment Currency stipulated in the judgment or judicial
            order at the Exchange Rate prevailing on the Judgment Conversion
            Date.

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        (c) Any amount due from the Borrower under this provision shall be
            due as a separate debt and shall not be affected by judgment
            being obtained for any other amounts due under or in respect
            of this Note.

5.10 Severability.  In the event that any provision of this Note is invalid or
     unenforceable under any applicable statute or rule of law, then such
     provision shall be deemed inoperative to the extent that it may conflict
     therewith and shall be deemed modified to conform with such statute or
     rule of law.  Any such provision which may prove invalid or unenforceable
     under any law shall not affect the validity or enforceability of any other
     provision of this Note.

5.11 Maximum Payments.  Nothing contained herein shall be deemed to establish
     or require the payment of a rate of interest or other charges in excess
     of the maximum permitted by applicable law.  In the event that the rate
     of interest required to be paid or other charges hereunder exceed the
     maximum rate permitted by such law, any payments in excess of such
     maximum rate shall be credited against amounts owed by the Borrower
     to the Holder and thus refunded to the Borrower.

5.12 Security Interest.  The Holder has been granted a security interest in
     certain assets of the Borrower as more fully described in the Security
     Agreement and pursuant to each of the Master Security Agreement, the
     Subsidiary Guarantee, and the Stock Pledge Agreement, each dated as of
     the date hereof.

5.13 Construction.  Each party acknowledges that its legal counsel
     participated in the preparation of this Note and, therefore, stipulates
     that the rule of construction that ambiguities are to be resolved against
     the drafting party shall not be applied in the interpretation of this
     Note to favor any party against the other.

[Balance of page intentionally left blank; signature page follows]

                                       10
<PAGE>

IN WITNESS WHEREOF, each Borrower has caused this Secured Convertible Minimum
Borrowing Note to be signed in its name effective as of this 14th day of
July, 2005.

                                        ON THE GO HEALTHCARE, INC.

                                        By:/s/Stuart Truk
                                        --------------------------
                                        Name: Stuart Truk
                                        Title:CEO

I/We have authority to bind the corporation.

                                       11
<PAGE>

                                  EXHIBIT A

                             NOTICE OF CONVERSION

 (To be executed by the Holder in order to convert the Secured Convertible
  Minimum Borrowing Note)

The undersigned hereby elects to convert $_________ of the principal and
$_________ of the interest due on the Secured Convertible Minimum Borrowing
Note dated as of _________, 200__ (the "Note") issued by On The Go Healthcare
Inc. (the "Company") into shares of Common Stock of the Company in accordance
with the terms and conditions set forth in the Note, as of the date written
below.

Date of Conversion:

Conversion Price:

Shares To Be Delivered:

Signature:

Print Name:

Address:

Holder  DWAC instructions

                                       12
<PAGE>SECURITY AND PURCHASE AGREEMENT
                            LAURUS MASTER FUND, LTD.
                                     And
                           ON THE GO HEALTHCARE, INC.

                              Dated: July 14, 2005

TABLE OF CONTENTS

ARTICLE 1 GENERAL DEFINITIONS AND TERMS; RULES OF CONSTRUCTION.         1
        1.1     General Definitions.                                    1
        1.2     Accounting Terms.                                       1
        1.3     Other Terms.                                            1
        1.4     Rules of Construction.                                  1
        1.5     Currency                                                2

ARTICLE 2 LOAN FACILITY.                                                2
        2.1     Revolving Loans.                                        2
        2.2     Receivables Purchase.                                   4
        2.3     Minimum Borrowing Amount.                               5
        2.4     Term Loan.                                              5
ARTICLE 3 REPAYMENT OF THE LOANS.                                       5

ARTICLE 4 PROCEDURE FOR REVOLVING LOANS.                                5

ARTICLE 5 INTEREST AND PAYMENTS.                                        6
        5.1     Interest.                                               6
        5.2     Payments; Certain Closing Conditions.                   7

ARTICLE 6 SECURITY INTEREST.                                            8

ARTICLE 7 REPRESENTATIONS, WARRANTIES AND COVENANTS                     9
        7.1     Concerning the Collateral.                              9

ARTICLE 8 PAYMENT OF ACCOUNTS.                                          11

ARTICLE 9 COLLECTION AND MAINTENANCE OF COLLATERAL.                     12

ARTICLE 10 INSPECTIONS AND APPRAISALS.                                  13

ARTICLE 11 FINANCIAL REPORTING.                                         13

ARTICLE 12 ADDITIONAL REPRESENTATIONS AND WARRANTIES.                   14
        12.1    Organization, Good Standing and Qualification.          14
        12.2    Subsidiaries.                                           15
        12.3    Capitalization; Voting Rights.                          15
        12.4    Authorization; Binding Obligations.                     16
        12.5    Liabilities.                                            16
        12.6    Agreements; Action.                                     16
        12.7    Obligations to Related Parties.                         18
        12.8    Changes.                                                18
        12.9    Title to Properties and Assets; Liens, Etc.             20
        12.10   Intellectual Property.                                  20
        12.11   Compliance with Other Instruments.                      20
        12.12   Litigation.                                             21
        12.13   Tax Returns and Payments.                               21
        12.14   Employees.                                              21
        12.15   Registration Rights and Voting Rights.                  22

                                       i
<PAGE>

        12.16   Compliance with Laws; Permits.                          22
        12.17   Environmental and Safety Laws.                          23
        12.18   Valid Offering.                                         23
        12.19   Full Disclosure.                                        23
        12.20   Insurance.                                              23
        12.21   SEC Reports and Financial Statements.                   24
        12.22   Listing.                                                24
        12.23   No Integrated Offering.                                 24
        12.24   Stop Transfer.                                          24
        12.25   Dilution.                                               25
        12.26   Patriot Act.                                            25
        12.27   Company Name; Locations of Offices,
                  Records and Collateral.                               25
        12.28   ERISA.                                                  26
        12.29   No Company maintains or contributes to any
                  Canadian Pension Plan.                                26

ARTICLE 13 COVENANTS.                                                   26
        13.1    Stop-Orders.                                            26
        13.2    Listing.                                                26
        13.3    Market Regulations.                                     27
        13.4    Reporting Requirements.                                 27
        13.5    Use of Funds.                                           27
        13.6    Access to Facilities.                                   27
        13.7    Taxes.                                                  27
        13.8    Insurance.                                              28
        13.9    Intellectual Property.                                  29
        13.10   Properties.                                             29
        13.11   Confidentiality.                                        29
        13.12   Required Approvals.                                     29
        13.13   Reissuance of Securities.                               31
        13.14   Opinion.                                                31
        13.15   Legal Name, etc.                                        31
        13.16   Compliance with Laws.                                   31
        13.17   Notices.                                                31
        13.18   Margin Stock.                                           32
        13.19   Offering Restrictions.                                  32
        13.20   Authorization and Reservation of Shares.                32
        13.21   Financing Right of First Refusal.                       32
        13.22   Additional Investment.                                  33

ARTICLE 14 FURTHER ASSURANCES.                                          33

ARTICLE 15 REPRESENTATIONS, WARRANTIES AND COVENANTS OF LAURUS.         33
        15.1    Requisite Power and Authority.                          34
        15.2    Investment Representations.                             34
        15.3    Laurus Bears Economic Risk.                             34
        15.4    Investment for Own Account.                             34
        15.5    Laurus Can Protect Its Interest.                        34
        15.6    Accredited Investor.                                    35
        15.7    Shorting.                                               35
        15.8    Patriot Act.                                            35
        15.9    Limitation on Acquisition of Common Stock.              35

ARTICLE 16 POWER OF ATTORNEY.                                           37

                                       ii
<PAGE>

ARTICLE 17 TERM OF AGREEMENT.                                           38

ARTICLE 18 TERMINATION OF LIEN.                                         38

ARTICLE 19 EVENTS OF DEFAULT.                                           38

ARTICLE 20 REMEDIES.                                                    41

ARTICLE 21 WAIVERS.                                                     43

ARTICLE 22 EXPENSES.                                                    43

ARTICLE 23 ASSIGNMENT BY LAURUS.                                        44

ARTICLE 24 NO WAIVER; CUMULATIVE REMEDIES.                              44

ARTICLE 25 APPLICATION OF PAYMENTS.                                     44

ARTICLE 26 INDEMNITY.                                                   44

ARTICLE 27 CURRENCY.                                                    45

ARTICLE 28 REVIVAL.                                                     45

ARTICLE 29 NOTICES.                                                     46

ARTICLE 30 GOVERNING LAW, JURISDICTION AND WAIVER OF JURY TRIAL.        47

ARTICLE 31 JUDGMENT CURRENCY.                                           48

ARTICLE 32 LIMITATION OF LIABILITY.                                     49

ARTICLE 33 ENTIRE UNDERSTANDING; MAXIMUM INTEREST.                      49

ARTICLE 34 SEVERABILITY.                                                49

ARTICLE 35 SURVIVAL.                                                    49

ARTICLE 36 CAPTIONS.                                                    50

ARTICLE 37 COUNTERPARTS; TELECOPIER SIGNATURES.                         50

ARTICLE 38 CONSTRUCTION.                                                50

ARTICLE 49 PUBLICITY.                                                   50

ARTICLE 40 JOINDER.                                                     50

ARTICLE 41 LEGENDS.                                                     51

                                       iii
<PAGE>

                        SECURITY AND PURCHASE AGREEMENT

        This Security and Purchase Agreement is made as of  July 14, 2005 by
        and among LAURUS MASTER FUND, LTD., a Cayman Islands corporation
        ("Laurus"),  ON THE GO HEALTHCARE, INC., a Delaware corporation
        (the "Company).

                                  BACKGROUND

        The Company has requested that Laurus make advances available to the
        Company; and

        Laurus has agreed to make such advances on the terms and conditions set
        forth in this Agreement.

                                  AGREEMENT

        NOW, THEREFORE, in consideration of the mutual covenants and
        undertakings and the terms and conditions contained herein, the parties
        hereto agree as follows:

                                  Article 1

GENERAL DEFINITIONS AND TERMS; RULES OF CONSTRUCTION.

1.1 General Definitions.

        Capitalized terms used in this Agreement shall have the meanings
        assigned to them in Annex A.

1.2 Accounting Terms.

        Any accounting terms used in this Agreement which are not specifically
        defined shall have the meanings customarily given them in accordance
        with GAAP and all financial computations shall be computed, unless
        specifically provided herein, in accordance with GAAP consistently
        applied.

1.3 Other Terms.

        All other terms used in this Agreement and defined in the UCC, shall
        have the meaning given therein unless otherwise defined herein.

1.4 Rules of Construction.

        All Schedules, Addenda, Annexes and Exhibits hereto or expressly
        identified to this Agreement are incorporated herein by reference and
        taken together with this Agreement constitute but a single agreement.
        The words "herein", "hereof" and "hereunder" or other words of similar
        import refer to this Agreement as a whole, including the Exhibits,
        Addenda, Annexes and Schedules thereto, as the same may be from time to
        time amended, modified, restated or supplemented, and not to any
        particular section, subsection or clause contained in this Agreement.
        Wherever from the context it appears appropriate, each term stated in
        either the singular or plural shall include the singular and the
        plural, and pronouns stated in the masculine, feminine or neuter
        gender shall include the masculine, the feminine and the neuter.
        The term "or" is not exclusive.  The term "including" (or any form

                                       1
<PAGE>

        thereof) shall not be limiting or exclusive.  All references to
        statutes and related regulations shall include any amendments of same
        and any successor statutes and regulations.  All references in this
        Agreement or in the Schedules, Addenda, Annexes and Exhibits to this
        Agreement to sections, schedules, disclosure schedules, exhibits, and
        attachments shall refer to the corresponding sections, schedules,
        disclosure schedules, exhibits, and attachments of or to this
        Agreement.  All references to any instruments or agreements,
        including references to any of this Agreement or the Ancillary
        Agreements shall include any and all modifications or amendments
        thereto and any and all extensions or renewals thereof.

1.5 Currency

        All principal, interest and other amounts owing under this Agreement
        and any Ancillary Agreements, that, in accordance with their terms,
        are to be paid in cash shall be paid in US dollars.   All amounts
        denominated in other currencies shall be converted into the US dollar
        equivalent amount in accordance with the Exchange Rate on the date of
        calculation.  "Exchange Rate" means, in relation to any amount of
        currency to be converted into US dollars pursuant to this Agreement
        and any Ancillary Agreements, the US dollar exchange rate as published
        in the Wall Street Journal on the relevant date of calculation.

                                  Article 2

LOAN FACILITY.

2.1 Revolving Loans.

        (a) Subject to the terms and conditions set forth herein and in the
            Ancillary Agreements, Laurus may make revolving loans (the
            "Revolving Loans") to Company from time to time during the Term
            which, in the aggregate at any time outstanding, will not exceed
            the lesser of (x) (I) the Capital Availability Amount minus (II)
            such reserves as Laurus may reasonably in its good faith judgment
            deem proper and necessary from time to time (the "Reserves") and
            (y) an amount equal to (I) the Accounts Availability minus (II)
            the Reserves.  The amount derived at any time from Section 2.1(a)
            (y)(I) minus 2.1(a)(y)(II) shall be referred to as the "Formula
            Amount."  The Company shall execute and deliver to Laurus on the
            Closing Date the Revolving Note and a Minimum Borrowing Note
            evidencing the Revolving Loans funded on the Closing Date.  From
            time to time thereafter, the Company shall execute and deliver to
            Laurus immediately prior to the final funding of each additional
            US$2,500,000 tranche of Revolving Loans allocated to any Minimum
            Borrowing Note issued after the date hereof (calculated on a
            cumulative basis for each such tranche) an additional Minimum
            Borrowing Note evidencing such tranche, substantially in the form
            of the Minimum Borrowing Note delivered by the Company to Laurus on
            the Closing Date.  Notwithstanding anything herein to the
            contrary, whenever during the Term the outstanding balance on
            the Minimum Borrowing Note shall be less than the Minimum Borrowing
            Amount (such amount being referred to herein as the "Transferable
            Amount") to the extent that the outstanding balance on the

                                       2
<PAGE>

            Revolving Note should equal or exceed US$1,000,000, that portion
            of the balance of the Revolving Note that exceeds US$1,000,000, but
            does not exceed the Transferable Amount, shall be segregated from
            the outstanding balance under the Revolving Note and allocated to
            and aggregated with the then existing balance of the next unissued
            serialized Minimum Borrowing Note (the "Next Unissued Serialized
            Note"); provided that such segregated amount shall remain subject
            to the terms and conditions of such Revolving Note until a new
            serialized Minimum Borrowing Note is issued as set forth below.
            The Next Unissued Serialized Note shall remain in book entry form
            until the balance thereunder shall equal the Minimum Borrowing
            Amount, at which time a new serialized Minimum Borrowing Note in
            the face amount equal to the Minimum Borrowing Amount will be
            issued and registered as set forth in the Registration Rights
            Agreement (and the outstanding balance under the Revolving Note
            shall at such time be correspondingly reduced in the amount equal
            to the Minimum Borrowing Amount as a result of the issuance of
            such new serialized Minimum Borrowing Note).

        (b) Notwithstanding the limitations set forth above, if requested by
            the Company, Laurus retains the right to lend to the Company from
            time to time such amounts in excess of such limitations as Laurus
            may determine in its sole discretion.

        (c) The Company acknowledges that the exercise of Laurus' discretionary
            rights hereunder may result during the Term in one or more
            increases or decreases in the advance percentages used in
            determining Accounts Availability and the Company hereby consents
            to any such increases or decreases which may limit or restrict
            advances requested by the Company.

        (d) If any interest, fees, costs or charges payable to Laurus hereunder
            are not paid when due, the Company shall thereby be deemed to have
            requested, and Laurus is hereby authorized at its discretion to
            make and charge to the Company' account, a Loan as of such date in
            an amount equal to such unpaid interest, fees, costs or charges.

        (e) If the Company at any time fails to perform or observe any of the
            covenants contained in this Agreement or any Ancillary Agreement,
            Laurus may to the extent permissible by state and federal law, but
            need not, perform or observe such covenant on behalf and in the
            name, place and stead of the Company (or, at Laurus' option, in
            Laurus' name) and may, but need not, take any and all other
            actions which Laurus may deem necessary to cure or correct such
            failure (including the payment of taxes, the satisfaction of
            Liens, the performance of obligations owed to Account Debtors,
            lessors or other obligors, the procurement and maintenance of
            insurance, the execution of assignments, security agreements and
            financing statements, and the endorsement of instruments).  The
            amount of all monies expended and all reasonable costs and
            expenses (including reasonable attorneys' fees and legal expenses)
            incurred by Laurus in connection with or as a result of the
            performance or observance of such agreements or the taking of
            such action by Laurus shall be charged to the Company' account
            as a Loan and added to the Obligations.  To facilitate Laurus'
            performance or observance of such covenants by the Company,
            the Company hereby irrevocably appoints Laurus, or Laurus'
            delegate, acting alone, as the Company's attorney in fact (which
            appointment is coupled with an interest) with the right (but not
            the duty) from time to time to create, prepare, complete, execute,
            deliver, endorse or file in the name and on behalf of the Company
            any and all instruments, documents, assignments, security
            agreements, financing statements, applications for insurance and
            other agreements and writings required to be obtained, executed,
            delivered or endorsed by the Company.

                                       3
<PAGE>

        (f) Laurus will account to the Company monthly with a written
            statement of all Loans and other advances, charges and payments
            made pursuant to this Agreement, and such account rendered by
            Laurus shall be deemed final, binding and conclusive unless Laurus
            is notified by  the Company in writing to the contrary within
            thirty (30) days of the date each account was received by the
            Company specifying the item or items to which objection is made.

        (g) During the Term, the Company may borrow and prepay Loans in
            accordance with the terms and conditions hereof.

        (h) If any Eligible Account is not paid by the Account Debtor within
            ninety (90) days after the date that such Eligible Account was
            invoiced or if any Account Debtor asserts a deduction, dispute,
            contingency, set-off, or counterclaim with respect to any Eligible
            Account, (a "Delinquent Account"), the Company shall(i) reimburse
            Laurus for the amount of the Loans made with respect to such
            Delinquent Account plus an adjustment fee in an amount equal to
            one-half of one percent (0.50%) of the gross face amount of such
            Eligible Account or (ii) immediately replace such Delinquent
            Account with an otherwise Eligible Account.

2.2 Receivables Purchase.

        Following the occurrence and during the continuance of an Event of
        Default, Laurus may, at its option, elect to convert the credit
        facility contemplated hereby to an accounts receivable purchase
        facility.  Upon such election by Laurus (subsequent notice of which
        Laurus shall provide to Company Agent), the Company shall be deemed
        to hereby have sold, assigned, transferred, conveyed and delivered
        to Laurus, and Laurus shall be deemed to have purchased and received
        from the Company, all right, title and interest of the Company in and
        to all Accounts which shall at any time constitute Eligible Accounts
        (the "Receivables Purchase").  All outstanding Loans hereunder shall
        be deemed obligations under such accounts receivable purchase facility.
        The conversion to an accounts receivable purchase facility in
        accordance with the terms hereof shall not be deemed an exercise by
        Laurus of its secured creditor rights under Article 9 of the UCC and
        the PPSA.  Immediately following Laurus' request, the Company shall
        execute all such further documentation as may be required by Laurus to
        more fully set forth the accounts receivable purchase facility herein
        contemplated, including, without limitation, Laurus' standard form of
        accounts receivable purchase agreement and account debtor notification
        letters, but the Company's failure to enter into any such documentation
        shall not impair or affect the Receivables Purchase in any manner
        whatsoever.

                                       4
<PAGE>

2.3 Minimum Borrowing Amount.

        After a registration statement registering the Registrable Securities
        (as defined in the Registration Rights Agreement) has been declared
        effective by the SEC, conversions of the Minimum Borrowing Amount into
        the Common Stock may be initiated as set forth in the respective
        Minimum Borrowing Note.  From and after the date upon which any
        outstanding principal of the Minimum Borrowing Amount (as evidenced by
        the first Minimum Borrowing Note) is converted into Common Stock (the
        "First Conversion Date"), (i) corresponding amounts of all outstanding
        Loans (not attributable to the then outstanding Minimum Borrowing
        Amount) existing on or made after the First Conversion Date will be
        aggregated in accordance with Section 2.1(a) and (ii), the Company
        will issue a new (serialized) Minimum Borrowing Note to Laurus in
        accordance with Section 2.1(a), and (iii)  the Company shall prepare
        and file a subsequent registration statement with the SEC to register
        such subsequent Minimum Borrowing Note as set forth in the Registration
        Rights Agreement.

2.4 Term Loan.

        Subject to the terms and conditions set forth herein and in the
        Ancillary Agreements, Laurus shall make a term loan (the "Term Loan")
        to the Company (for the benefit of Companies) in an aggregate principal
        amount equal to US$500,000.  The Term Loan shall be advanced on the
        Closing Date and shall be, with respect to principal, payable in
        consecutive monthly instalments of principal commencing on
        December 1, 2005 and on the first day of each month thereafter, subject
        to acceleration upon the occurrence of an Event of Default or
        termination of this Agreement.  Principal instalments shall each be
        in the amount of US$15,625.00 and the final instalment shall be in an
        amount equal to the unpaid principal balance of the Term Loan plus all
        accrued and unpaid interest thereon.  The Term Loan shall be evidenced
        by the Secured Convertible Term Note.

                                  Article 3

REPAYMENT OF THE LOANS.

        The Company (a) may prepay the Obligations from time to time in
        accordance with the terms and provisions of the Notes (and Article 17
        hereof if such prepayment is due to a termination of this Agreement);
        (b) shall repay on the expiration of the Term (i) the then aggregate
        outstanding principal balance of the Loans together with accrued and
        unpaid interest, fees and charges and; (ii) all other amounts owed
        Laurus under this Agreement and the Ancillary Agreements; and
        (c) subject to Section 2.1(b) and Section 5.2(b) hereof, shall repay
        on any day on which the then aggregate outstanding principal balance
        of the Loans are in excess of the Formula Amount at such time, Loans
        in an amount equal to such excess. Any payments of principal,
        interest, fees or any other amounts payable hereunder or under any
        Ancillary Agreement shall be made prior to 4:00 pm (New York time)
        on the due date thereof in immediately available funds.

                                       5
<PAGE>

                                  Article 4

PROCEDURE FOR REVOLVING LOANS.

        The Company may by written notice request a borrowing of Revolving
        Loans prior to 12:00 noon (New York time) on the Business Day of its
        request to incur, on the next Business Day, a Revolving Loan.
        Together with each request for a Revolving Loan (or at such other
        intervals as Laurus may request), the Company shall deliver to Laurus
        a Borrowing Base Certificate in the form of Exhibit B attached hereto,
        which shall be certified as true and correct by the Chief Executive
        Officer or Chief Financial Officer of  the Company together with all
        supporting documentation relating thereto.  All Revolving Loans shall
        be disbursed from whichever office or other place Laurus may designate
        from time to time and shall be charged to the Company' account on
        Laurus' books.  The proceeds of each Revolving Loan made by Laurus
        shall be made available to the Company on the Business Day following
        the Business Day so requested in accordance with the terms of this
        Article 4 by way of credit to the applicable Company's operating
        account maintained with such bank as  the Company designated to Laurus.
        Any and all Obligations due and owing hereunder may be charged to the
        Company' account and shall constitute Revolving Loans.

                                  Article 5

INTEREST AND PAYMENTS.

5.1 Interest.

        (a) Except as modified by Section 5.1(c) below, the Company shall pay
            interest at the Contract Rate on the unpaid principal balance of
            each Loan until such time as such Loan is collected in full in
            good funds in dollars of the United States of America.

        (b) Interest and payments shall be computed on the basis of actual
            days elapsed in a year of 360 days.  Consistent with the terms of
            the Loan, Laurus may charge the Company's account for said
            interest.

        (c) Effective upon the occurrence of any  Event of Default and for so
            long as any Event of Default shall be continuing, the Contract
            Rate shall automatically be increased as set forth in the Notes
            (such increased rate, the "Default Rate"), and all outstanding
            Obligations, including unpaid interest, shall continue to accrue
            interest from the date of such Event of Default at the Default
            Rate applicable to such Obligations.

        (d) In no event shall the aggregate interest payable hereunder exceed
            the maximum rate permitted under any applicable law or regulation,
            as in effect from time to time (the "Maximum Legal Rate"), and if
            any provision of this Agreement or any Ancillary Agreement is in
            contravention of any such law or regulation, interest payable
            under this Agreement and each Ancillary Agreement shall be computed
            on the basis of the Maximum Legal Rate (so that such interest will
            not exceed the Maximum Legal Rate).

                                       6
<PAGE>

        (e) The Company shall pay principal, interest and all other amounts
            payable hereunder, or under any Ancillary Agreement, without any
            deduction whatsoever, including any deduction for any set-off or
            counterclaim or deduction or withholding for any taxes, levies,
            imposts, deductions, charges or withholdings of whatever kind or
            nature.  If the Company shall be required by law to deduct or
            withhold any taxes from or in respect of any sum payable hereunder
            to Laurus, then:

                (i) the sum payable to Laurus shall be increased as necessary
                    so that after making all required deductions and
                    withholdings Laurus receives an amount equal to the sum it
                    would have received had no such deductions or withholdings
                    been made;

                (ii) the Company shall make such deductions and withholdings;

                (iii) the Company shall pay the full amount deducted or
                      withheld to the relevant taxing authority or other
                      authority in accordance with applicable law; and

                (iv) without duplication of amounts paid under clause (1), the
                     Company shall also pay to Laurus for the account of
                     Laurus, at the time interest is paid, all additional
                     amounts which Laurus specifies as necessary to preserve
                     the after-tax yield Laurus would have received if such
                     taxes had not been imposed.

5.2 Payments; Certain Closing Conditions.

        (a) Closing/Annual Payments.  Upon execution of this Agreement by the
            Company and Laurus, the Company shall pay to Laurus Capital
            Management, LLC a closing payment in an amount equal to three and
            nine tenths (3.90%) percent of the Total Investment Amount.  Such
            payment shall be deemed fully earned on the Closing Date and shall
            not be subject to rebate or proration for any reason.

        (b) Overadvance Payment.  Without affecting Laurus' rights hereunder
            in the event the Revolving Loans exceed the Formula Amount (each
            such event, an "Overadvance"), and Laurus elects to exercise its
            rights under Section 2.1(b) to make an Overadvance to the Company,
            all such Overadvances shall bear additional interest at a rate
            equal to two percent (2%) per month of the amount of such
            Overadvances for all times such amounts shall be in excess of
            the Formula Amount.  Unless otherwise specified by Laurus in
            writing, all amounts that are incurred pursuant to this
            Section 5.2(b) shall be due and payable by the Company monthly,
            in arrears, on the first business day of each calendar month
            and upon expiration of the Term.

        (c) Financial Information Default.  Without affecting Laurus' other
            rights and remedies, in the event the Company fails to deliver
            the financial information required by Article 11 on or before
            the date required by this Agreement, the Company shall pay Laurus
            an aggregate fee in the amount of US$500.00 per week (or portion
            thereof) for each such failure until such failure is cured to
            Laurus' satisfaction or waived in writing by Laurus.  All amounts
            that are incurred pursuant to this Section 5.2(c) shall be due
            and payable by the Company monthly, in arrears, on the first
            business of each calendar month and upon expiration of the Term.

                                       7
<PAGE>

        (d) Expenses.  The Company shall reimburse Laurus for its expenses
            (including reasonable legal fees and expenses) incurred in
            connection with the preparation and negotiation of this Agreement
            and the Ancillary Agreements, and expenses incurred in connection
            with Laurus' due diligence review of the Company and its
            Subsidiaries and all related matters.  Amounts required to be
            paid under this Section 5.2(d) will be paid on the Closing Date
            and shall not exceed US$52,500 for such expenses referred to in
            this Section 5.2(d).

                                  Article 6

SECURITY INTEREST.

        (a) To secure the prompt payment to Laurus of the Obligations,  the
            Company hereby assigns, pledges and grants to Laurus a continuing
            security interest in and Lien upon all of the Collateral.  All of
            the Company's Books and Records relating to the Collateral shall,
            until delivered to or removed by Laurus, be kept by the Company in
            trust for Laurus until all Obligations have been paid in full.
            Each confirmatory assignment schedule or other form of assignment
            hereafter executed by the Company shall be deemed to include the
            foregoing grant, whether or not the same appears therein. All
            commercial tort claims of the Company are set forth and described
            more particularly on Schedule 6(a) hereto.

        (b) the Company hereby (i) authorizes Laurus to file any financing
            statements, change financing statements, continuation statements
            or amendments thereto that (x) indicate the Collateral (1) as all
            assets and personal property of the Company or words of similar
            effect, regardless of whether any particular asset comprised in
            the Collateral falls within the scope of Article 9 of the UCC of
            such jurisdiction and the PPSA, or (2) as being of an equal or
            lesser scope or with greater detail, and (y) contain any other
            information required by Part 5 of Article 9 of the UCC and the
            PPSA for the sufficiency or filing office acceptance of any
            financing statement, change financing statements, continuation
            statement or amendment and (ii) ratifies its authorization for
            Laurus to have filed any initial financial statements, or
            amendments thereto if filed prior to the date hereof.   The
            Company acknowledges that it is not authorized to file any
            financing statement, change financing statements, discharge
            statement or amendment or termination statement with respect
            to any financing statement without the prior written consent
            of Laurus and agrees that it will not do so without the prior
            written consent of Laurus which will not be unreasonably withheld,
            subject to the Company's rights under Section 9-509(d)(2) of
            the UCC and under the PPSA.

        (c) Reserved.

                                       8
<PAGE>

                                  Article 7

REPRESENTATIONS, WARRANTIES AND COVENANTS

7.1 Concerning the Collateral.

        The Company represents, warrants (each of which such representations
        and warranties shall be deemed repeated upon the making of each request
        for a Revolving Loan and made as of the time of each and every
        Revolving Loan hereunder) and covenants as follows:

        (a) all of the Collateral (i) is owned by it free and clear of all
            Liens (including any claims of infringement) except those in
            Laurus' favor and Permitted Liens and (ii) is not subject to any
            agreement prohibiting the granting of a Lien or requiring notice of
            or consent to the granting of a Lien;

        (b) it shall not encumber, mortgage, pledge, assign or grant any Lien
            in any Collateral or any other assets to anyone other than Laurus
            and except for Permitted Liens;

        (c) Schedule 7.1(c) lists all banks and other financial institutions at
            which it maintains deposits and/or other accounts, and such
            Schedule correctly identifies the name, address and telephone
            number of each such depository, the name in which the account is
            held, a description of the purpose of the account, and the complete
            account number.  It shall not establish any depository or other
            bank account with any financial institution (other than the
            accounts set forth on Schedule 7.1(c)) without Laurus' prior
            written consent;

        (d) the Liens granted pursuant to this Agreement, upon completion of
            the filings and other actions listed on Schedule  7.1(d) (which, in
            the case of all filings and other documents referred to in said
            Schedule, have been delivered to Laurus in duly executed form)
            constitute valid perfected security interests in all of the
            Collateral in favour of Laurus as security for the prompt and
            complete payment and performance of the Obligations, enforceable
            in accordance with the terms hereof against any and all of its
            creditors and purchasers and such security interest is prior to
            all other Liens in existence on the date hereof;

        (e) no effective security agreement, mortgage, deed of trust, financing
            statement, equivalent security or Lien instrument or continuation
            statement covering all or any part of the Collateral is or will be
            on file or of record in any public office, except those relating
            to Permitted Liens;

        (f) it shall not dispose of any of the Collateral whether by sale,
            lease or otherwise except for the sale of Inventory in the ordinary
            course of business and for the disposition or transfer in the
            ordinary course of business during any fiscal year of obsolete and
            worn-out Equipment having an aggregate fair market value of not
            more than US$50,000 and only to the extent that (i) the proceeds
            of any such disposition are used to acquire replacement Equipment
            which is subject to Laurus' first priority security interest or
            are used to repay Loans or to pay general corporate expenses, or
            (ii) following the occurrence of an Event of Default which
            continues to exist the proceeds of which are remitted to Laurus to
            be held as cash collateral for the Obligations;

                                       9
<PAGE>

        (g) it shall defend the right, title and interest of Laurus in and to
            the Collateral against the claims and demands of all Persons
            whomsoever, and take such actions, including (i) all actions
            necessary to grant Laurus "control" of any Investment Property,
            Deposit Accounts, Letter-of-Credit Rights or electronic Chattel
            Paper owned by it, with any agreements establishing control to be
            in form and substance satisfactory to Laurus, (ii) the prompt (but
            in no event later than five (5) Business Days following Laurus'
            request therefor) delivery to Laurus of all original Instruments,
            Chattel Paper, negotiable Documents and certificated Stock owned
            by it (in each case, accompanied by stock powers, allonges or
            other instruments of transfer executed in blank), (iii)
            notification of Laurus' interest in Collateral at Laurus' request,
            and (iv) the institution of litigation against third parties as
            shall be prudent in order to protect and preserve its and/or
            Laurus' respective and several interests in the Collateral;

        (h) it shall promptly, and in any event within five (5) Business Days
            after the same is acquired by it, notify Laurus of any commercial
            tort claim acquired by it and unless otherwise consented by Laurus,
            it shall enter into a supplement to this Agreement granting to
            Laurus a Lien in such commercial tort claim;

        (i) it shall place notations upon its Books and Records and any of its
            financial statements to disclose Laurus' Lien in the Collateral;

        (j) if it retains possession of any Chattel Paper or Instrument with
            Laurus' consent, upon Laurus' request such Chattel Paper and
            Instruments shall be marked with the following legend:  "This
            writing and obligations evidenced or secured hereby are subject
            to the security interest of Laurus Master Fund, Ltd."
            Notwithstanding the foregoing, upon the reasonable request of
            Laurus, such Chattel Paper and Instruments shall be delivered
            to Laurus;

        (k) it shall perform in a reasonable time all other steps requested
            by Laurus to create and maintain in Laurus' favor a valid perfected
            first Lien in all Collateral subject only to Permitted Liens;

        (l) it shall notify Laurus promptly and in any event within three (3)
            Business Days after obtaining knowledge thereof (i) of any event or
            circumstance that, to its knowledge, would cause the Laurus to
            consider any then existing Account as no longer constituting an
            Eligible Account; (ii) of any material delay in its performance of
            any of its obligations to any Account Debtor; (iii) of any
            assertion by any Account Debtor of any material claims, offsets or
            counterclaims; (iv) of any material allowances, credits and/or
            monies granted by it to any Account Debtor; (v) of all material
            adverse information relating to the financial condition of an
            Account Debtor; (vi) of any material return of goods; and (vii)
            of any material loss, damage or destruction of any of the
            Collateral;

                                       10
<PAGE>

        (m) (all Eligible Accounts (i) represent complete bona fide
            transactions which require no further act under any circumstances
            on its part to make such Accounts payable by the Account Debtors,
            (ii) are not subject to any present, future contingent offsets or
            counterclaims, and (iii) do not represent bill and hold sales,
            consignment sales, guaranteed sales, sale or return or other
            similar understandings or obligations of any Affiliate or
            Subsidiary of the Company.  It has not made, nor will it make,
            any agreement with any Account Debtor for any extension of time
            for the payment of any Account, any compromise or settlement for
            less than the full amount thereof, any release of any Account
            Debtor from liability therefor, or any deduction therefrom except
            a discount or allowance for prompt or early payment allowed by it
            in the ordinary course of its business consistent with historical
            practice and as previously disclosed to Laurus in writing;

        (n) it shall keep and maintain its Equipment in good operating
            condition, except for ordinary wear and tear, and shall make all
            necessary repairs and replacements thereof so that the value and
            operating efficiency shall at all times be maintained and
            preserved.  It shall not permit any such items to become a
            Fixture to real estate or accessions to other personal property;

        (o) it shall maintain and keep all of its Books and Records concerning
            the Collateral at its executive offices listed in Schedule 12.27;

        (p) it shall maintain and keep the tangible Collateral at the
            addresses listed in Article 29 hereof, , provided, that it may
            change such locations or open a new location, provided that it
            provides Laurus at least thirty (30) days prior written notice
            of such changes or new location and (ii) prior to such change or
            opening of a new location where Collateral having a value of more
            than US$50,000 will be located, it executes and delivers to Laurus
            such agreements deemed reasonably necessary or prudent by Laurus,
            including landlord agreements, mortgagee agreements and warehouse
            agreements, each in form and substance satisfactory to Laurus, to
            adequately protect and maintain Laurus' security interest in such
            Collateral; and

        (q) it and Laurus have not agreed to postpone the time of attachment of
            the security interest granted hereunder which shall attach up the
            execution of this Agreement and, in the case of Collateral acquired
            after the date hereof, when the Company has rights therein.

                                       11
<PAGE>

                                  Article 8

PAYMENT OF ACCOUNTS.

        (a) The Company will irrevocably direct all of its present and future
            Account Debtors and other Persons obligated to make payments
            constituting Collateral to make such payments directly to the
            lockboxes maintained by the Company (the "Canadian Lockboxes")
            with The Toronto-Dominion Bank or such other financial institution
            accepted by Laurus in writing as may be selected by the Company
            (the "Canadian Lockbox Bank") pursuant to the terms of the certain
            agreements among one or more Companies, Laurus and/or the Canadian
            Lockbox Bank dated as of July 14, 2005.  On or prior to the Closing
            Date, the Company shall and shall cause the Canadian Lockbox Bank
            to enter into all such documentation acceptable to Laurus pursuant
            to which, among other things, the Canadian Lockbox Bank agrees to:
            (a) sweep the Canadian Lockbox as required to pay amounts due and
            payable on the Notes, as provided therein, and deposit all checks
            received therein to lockboxes maintained by the Company (the "US
            Lockboxes") with The Toronto-Dominion Bank or such other financial
            institution accepted by Laurus in writing as may be selected by
            the Company (the "US Lockbox Bank") pursuant to the terms of the
            certain agreements among one or more Companies, Laurus and/or the
            US Lockbox Bank dated as of July 14, 2005, and (b) comply only with
            the instructions or other directions of Laurus concerning the
            Canadian Lockbox.  On or prior to the Closing Date,  the Company
            shall and shall cause the US Lockbox Bank to enter into all such
            documentation acceptable to Laurus pursuant to which, among other
            things, the US Lockbox Bank agrees to:  (a) sweep the US Lockbox
            as required to pay amounts due and payable on the Notes, as
            provided therein,  and deposit all checks received therein to an
            account designated by Laurus in writing and (b) comply only with
            the instructions or other directions of Laurus concerning the
            US Lockbox.  All of the Company's invoices, account statements and
            other written or oral communications directing, instructing,
            demanding or requesting payment of any Account of the Company or
            any other amount constituting Collateral shall conspicuously direct
            that all payments be made to the Canadian Lockbox or such other
            address as Laurus may direct in writing.  If, notwithstanding the
            instructions to Account Debtors, the Company receives any payments,
            the Company shall immediately remit such payments to Laurus in
            their original form with all necessary endorsements.  Until so
            remitted, the Company shall hold all such payments in trust for
            and as the property of Laurus and shall not commingle such
            payments with any of its other funds or property.

        (b) At Laurus' election, following the occurrence of an Event of
            Default which is continuing, Laurus may notify the Company's
            Account Debtors of Laurus' security interest in the Accounts,
            collect them directly and charge the collection costs and expenses
            thereof to Company's and the Eligible Subsidiaries joint and
            several account.

                                  Article 9

COLLECTION AND MAINTENANCE OF COLLATERAL.

        (a) Laurus may verify the Company's Accounts from time to time, but
            not more often than once every three (3) months, unless an Event
            of Default has occurred and is continuing, or Laurus believes that
            such verification is necessary to preserve or protect the
            Collateral utilizing an audit control company or any other agent
            of Laurus.

                                       12
<PAGE>

        (b) Proceeds of Accounts received by Laurus will be deemed received on
            the Business Day after Laurus' receipt of such proceeds in good
            funds in dollars of the United States of America to an account
            designated by Laurus.  Any amount received by Laurus after
            12:00 noon (New York time) on any Business Day shall be deemed
            received on the next Business Day.

        (c) As Laurus receives the proceeds of Accounts of the Company, it
            shall (i) apply such proceeds, as required, to amounts outstanding
            under the Notes, and (ii) remit all such remaining proceeds (net of
            interest, fees and other amounts then due and owing to Laurus
            hereunder) to the Company (for the benefit of the applicable
            Companies) upon request (but no more often than twice a week).
            Notwithstanding the foregoing, following the occurrence and during
            the continuance of an Event of Default, Laurus, at its option, may
            (a) apply such proceeds to the Obligations in such order as Laurus
            shall elect, (b) hold all such proceeds as cash collateral for the
            Obligations and the Company hereby grants to Laurus a security
            interest in such cash collateral amounts as security for the
            Obligations and/or (c) do any combination of the foregoing.

                                  Article 10

INSPECTIONS AND APPRAISALS.

        At all times during normal business hours, Laurus, and/or any
        agent of Laurus shall have the right to (a) have access to, visit,
        inspect, review, evaluate and make physical verification and
        appraisals of the Company's properties and the Collateral, (b) inspect,
        audit and copy (or take originals if necessary) and make extracts
        from  the Company's Books and Records, including management letters
        prepared by the Accountants, and (c) discuss with  the Company's
        directors, principal officers, and independent accountants,  the
        Company's business, assets, liabilities, financial condition, results
        of operations and business prospects.   The Company will deliver to
        Laurus any instrument necessary for Laurus to obtain records from any
        service bureau maintaining records for the Company.  If any
        internally prepared financial information, including that required
        under this Section is unsatisfactory in any manner to Laurus,
        Laurus may request that the Accountants selected by Laurus review
        the same.  .

                                  Article 11

FINANCIAL REPORTING.

        The Company will deliver, or cause to be delivered, to Laurus the
        following, which shall be in form and detail acceptable to Laurus:

        (a) Within ninety (90) days after the end of each fiscal year of the
            Company unless the Company files a NT with the Securities and
            Exchange Commission and, in that case, on the date the Company
            files its financial statements the SEC,  the Company's audited
            financial statements with a report of independent certified
            public accountants of recognized standing selected by the Company
            (the "Accountants"), which annual financial statements shall
            comply with the rules and regulations of the SEC and GAAP,
            together with (i) if and when available, copies of any management
            letters prepared by the Accountants; and (ii) a certificate of
            the Company's President, Chief Executive Officer or Chief
            Financial Officer stating, to that Officer's knowledge, that
            such financial statements have been prepared in accordance with
            GAAP and whether or not such officer has knowledge of the
            occurrence of any Default or Event of Default hereunder and, if
            so, stating in reasonable detail the facts with respect thereto;

                                       13
<PAGE>

        (b) As soon as available and in any event within forty five (45) days
            after the end of each quarter unless the Company files a NT with
            the Securities and Exchange Commission and, in that case, on the
            date the Company files its financial statements the SEC, an
            unaudited/internal balance sheet and statements of income, retained
            earnings and cash flows of the Company as at the end of and for
            such quarter and for the year to date period then ended, prepared
            consistent with the rules and regulations of the SEC and GAAP and
            accompanied by a certificate of the Company's President, Chief
            Executive Officer or Chief Financial Officer, stating to that
            Officer's knowledge (i) that such financial statements have been
            prepared in accordance with GAAP, subject to year-end audit
            adjustments, and (ii) whether or not such officer has knowledge of
            the occurrence of any Default or Event of Default hereunder not
            theretofore reported and remedied and, if so, stating in reasonable
            detail the facts with respect thereto;

        (c) Within fifteen (15) days after the end of each month (or more
            frequently if Laurus so requests), agings of the Company's
            Accounts, unaudited trial balances and their accounts payable and
            a calculation of  the Company's Accounts, Eligible Accounts,
            provided, however, that if Laurus shall request the foregoing
            information more often than as set forth in the immediately
            preceding clause,  the Company shall have fifteen (15) days from
            each such request to comply with Laurus' demand; and

        (d) Promptly after (i) the filing thereof, copies of the Company's
            most recent registration statements and annual, quarterly, monthly
            or other regular reports which the Company files with the
            Securities and Exchange Commission (the "SEC"), and (ii) the
            issuance thereof, copies of such financial statements, reports
            and proxy statements as  the Company shall send to its
            stockholders.

        (e) If any documents required to be delivered pursuant to this
            Section 11 are filed on EDGAR, they shall be deemed delivered to
            Laurus.

                                       14
<PAGE>

                                  Article 12

ADDITIONAL REPRESENTATIONS AND WARRANTIES.

        The Company hereby represents and warrants to Laurus as follows:

12.1 Organization, Good Standing and Qualification.

        The Company and each of its Subsidiaries is a corporation, partnership
        or limited liability company, as the case may be, duly organized,
        validly existing and in good standing under the laws of its
        jurisdiction of organization.  The Company and each of its
        Subsidiaries has the corporate, limited liability company or
        partnership, as the   case may be, power and authority to own and
        operate its properties and assets and, insofar as it is or shall be
        a party thereto, to (i) execute and deliver this Agreement and the
        Ancillary Agreements, (ii) to issue the Notes and the shares of Common
        Stock issuable upon conversion of the Notes (the "Note Shares"),
        (iii) to issue the Warrants and the shares of Common Stock issuable
        upon conversion of the Warrants (the "Warrant Shares"), and to (iv)
        carry out the provisions of this Agreement and the Ancillary Agreements
        and to carry on its business as presently conducted.  The Company and
        each of its Subsidiaries is duly qualified and is authorized to do
        business and is in good standing as a foreign corporation, partnership
        or limited liability company, as the case may be, in all jurisdictions
        in which the nature or location of its activities and of its
        properties (both owned and leased) makes such qualification necessary,
        except for those jurisdictions in which failure to do so has not had,
        or could not reasonably be expected to have, individually or in the
        aggregate, a Material Adverse Effect.

12.2 Subsidiaries.

        Each of its direct and indirect Subsidiaries, the direct owner of
        each such Subsidiary and its percentage ownership thereof, is set forth
        on Schedule 12.2.

12.3 Capitalization; Voting Rights.

        (a) The authorized capital stock of the Company, as of July 12, 2005
            consists of 100,000,000 shares of common stock par value US$0.0001,
            of which 2,344,452 are issued and outstanding, and 1,000,000 are
            shares of preferred stock, par value US$0.01 per share of which
            279,134 shares of preferred stock are issued and outstanding.
            The authorized, issued and outstanding capital stock of each
            Subsidiary of the Company is set forth on Schedule 12.3.

        (b) Except as disclosed on Schedule 12.3, other than:  (i) the shares
            reserved for issuance under the Company's stock option plans; and
            (ii) shares which may be issued pursuant to this Agreement and the
            Ancillary Agreements, there are no outstanding options, warrants,
            rights (including conversion or preemptive rights and rights of
            first refusal), proxy or stockholder agreements, or arrangements
            or agreements of any kind for the purchase or acquisition from the
            Company of any of its securities.  Except as disclosed on
            Schedule 12.3, neither the offer or issuance of any of the Notes
            or the Warrants, or the issuance of any of the Note Shares or the
            Warrant Shares, nor the consummation of any transaction
            contemplated hereby will result in a change in the price or number
            of any securities of the Company outstanding, under anti-dilution
            or other similar provisions contained in or affecting any such
            securities.

                                       15
<PAGE>

        (c) All issued and outstanding shares of the Company's Common Stock:
            (i) have been duly authorized and validly issued and are fully paid
            and nonassessable; and (ii) were issued in compliance with all
            applicable state and federal laws concerning the issuance of
            securities.

        (d) The rights, preferences, privileges and restrictions of the shares
            of the Common Stock are as stated in the Company's Certificate of
            Incorporation (the "Charter").  The Note Shares and the Warrant
            Shares have been duly and validly reserved for issuance.  When
            issued in compliance with the provisions of this Agreement and
            the Company's Charter, the Securities will be validly issued,
            fully paid and nonassessable, and will be free of any liens or
            encumbrances; provided, however, that the Securities may be subject
            to restrictions on transfer under state and/or federal securities
            laws as set forth herein or as otherwise required by such laws
            at the time a transfer is proposed.

12.4 Authorization; Binding Obligations.

        All actions on the Company's and its Subsidiaries' part (including
        their respective officers and directors) necessary for the
        authorization of this Agreement and the Ancillary Agreements, the
        performance of all of its and its Subsidiaries' obligations hereunder
        and under the Ancillary Agreements on the Closing Date and, the
        authorization, issuance and delivery of the Notes and the Warrant has
        been taken or will be taken prior to the Closing Date.  This Agreement
        and the Ancillary Agreements, when executed and delivered and to the
        extent it is a party thereto, will be each of the Company's and its
        Subsidiaries' valid and binding obligations enforceable against the
        Company and its Subsidiary in accordance with their terms, except:

        (a) as limited by applicable bankruptcy, insolvency, reorganization,
            moratorium or other laws of general application affecting
            enforcement of creditors' rights; and

        (b) general principles of equity that restrict the availability of
            equitable or legal remedies.

        (c) The issuance of the Notes and the subsequent conversion of the
            Notes into Note Shares are not and will not be subject to any
            preemptive rights or rights of first refusal that have not been
            properly waived or complied with.  The issuance of the Warrants
            and the subsequent exercise of the Warrants for Warrant Shares are
            not and will not be subject to any preemptive rights or rights of
            first refusal that have not been properly waived or complied with.

                                       16
<PAGE>

12.5 Liabilities.

        Neither the Company nor any of its Subsidiaries has any  liabilities,
        except current liabilities incurred in the ordinary course of business
        and liabilities disclosed in any Exchange Act Filings.

12.6 Agreements; Action.

        Except as set forth on Schedule 12.6 or as disclosed in any Exchange
        Act Filings:

        (a) There are no agreements, understandings, instruments, contracts,
            proposed transactions, judgments, orders, writs or decrees to which
            the Company or any of its Subsidiaries is a party or to its
            knowledge by which it is bound which may involve:  (i) obligations
            (contingent or otherwise) of, or payments to, the Company or any
            of its Subsidiaries in excess of US$50,000 (other than obligations
            of, or payments to, the Company or any of its Subsidiaries arising
            from purchase or sale agreements entered into in the ordinary
            course of business); or (ii) the transfer or license of any patent,
            copyright, trade secret or other proprietary right to or from it
            (other than licenses arising from the purchase of "off the shelf"
            or other standard products); or (iii) provisions restricting the
            development, manufacture or distribution of the Company's or any
            of its Subsidiaries' products or services; or (iv) indemnification
            by the Company or any of its Subsidiaries with respect to
            infringements of proprietary rights.

        (b) Since July 31, 2004 (the "Balance Sheet Date") neither the Company
            nor any of its Subsidiaries has:  (i) declared or paid any
            dividends, or authorized or made any distribution upon or with
            respect to any class or series of its capital stock; (ii)
            incurred any indebtedness for money borrowed or any other
            liabilities (other than ordinary course obligations) individually
            in excess of US$50,000 or, in the case of indebtedness and/or
            liabilities individually less than US$50,000, in excess of
            US$100,000 in the aggregate; (iii) made any loans or advances to
            any Person not in excess, individually or in the aggregate, of
            US$100,000, other than ordinary advances for travel expenses;
            or (iv) sold, exchanged or otherwise disposed of any of its
            assets or rights, other than the sale of its Inventory in the
            ordinary course of business.

        (c) For the purposes of subsections (a) and (b) of this Section 12.6,
            all indebtedness, liabilities, agreements, understandings,
            instruments, contracts and proposed transactions involving the
            same Person (including Persons it or any of its applicable
            Subsidiaries has reason to believe are affiliated therewith or
            with any Subsidiary thereof) shall be aggregated for the purpose
            of meeting the individual minimum dollar amounts of such
            subsections.

        (d) the Company maintains disclosure controls and procedures
            ("Disclosure Controls") designed to ensure that information
            required to be disclosed by  the Company in the reports that
            it files or submits under the Exchange Act is recorded,
            processed, summarized, and reported, within the time periods
            specified in the rules and forms of the SEC.

                                       17
<PAGE>

        (e) the Company makes and keeps books, records, and accounts, that,
            in reasonable detail, accurately and fairly reflect the
            transactions and dispositions of its assets.  It maintains
            internal control over financial reporting ("Financial Reporting
            Controls") designed by, or under the supervision of, its principal
            executive and principal financial officers, and effected by its
            board of directors, management, and other personnel, to provide
            reasonable assurance regarding the reliability of financial
            reporting and the preparation of financial statements for
            external purposes in accordance with GAAP, including that:

                  (i) transactions are executed in accordance with management's
                      general or specific authorization;

                 (ii) unauthorized acquisition, use, or disposition of the
                      Company's assets that could have a material effect on the
                      financial statements are prevented or timely detected;

                (iii) transactions are recorded as necessary to permit
                      preparation of financial statements in accordance with
                      GAAP, and that its receipts and expenditures are being
                      made only in accordance with authorizations of the
                      Company's management and board of directors;

                 (iv) transactions are recorded as necessary to maintain
                      accountability for assets; and

                  (v) the recorded accountability for assets is compared with
                      the existing assets at reasonable intervals, and
                      appropriate action is taken with respect to any
                      differences.

        (f) To the Company's knowledge, there is no material weakness in any of
            the Company's Disclosure Controls or Financial Reporting Controls
            that is required to be disclosed in any of the Exchange Act
            Filings, except as so disclosed.

12.7 Obligations to Related Parties.

        Except as described in the Company's SEC filings or set forth on
        Schedule 12.7, neither the Company nor any of its Subsidiaries has
        any obligations to their respective officers, directors, stockholders
        or employees other than:

        (a) for payment of salary for services rendered and for bonus payments;

        (b) reimbursement for reasonable expenses incurred on its or its
            Subsidiaries' behalf;

        (c) for other standard employee benefits made generally available
            to all employees (including stock option agreements outstanding
            under any stock option plan approved by its and its Subsidiaries'
            Board of Directors, as applicable); and

                                       18
<PAGE>

        (d) obligations listed in its and each of its Subsidiary's financial
            statements or disclosed in any of the Company's Exchange Act
            Filings.

        Except as described in the Company's SEC filings or set forth on
        Schedule 12.7, none of the Company's officers, directors or, to the
        best of its knowledge, key employees or 10% or greater stockholders,
        any of its Subsidiaries or any members of their immediate families,
        are indebted to it or any of its Subsidiaries, individually or in the
        aggregate, in excess of US$60,000 or have any direct or indirect
        ownership interest in any Person with which the Company or any of its
        Subsidiaries is affiliated or with which the Company or any of its
        Subsidiaries has a business relationship, other than passive
        investments in publicly traded companies (representing less than one
        percent (1%) of the Company). Except as described in the Company's SEC
        filings or set forth on Schedule 12.7, none of its officers, directors
        or 10% or greater stockholders, or any member of their immediate
        families, is, directly or indirectly, interested in any material
        contract with the Company or any of its Subsidiaries and no agreements,
        understandings or proposed transactions are contemplated between the
        Company or any of its Subsidiaries and any such Person.  Except as
        described in the Company's SEC filings or set forth on Schedule 12.7,
        neither the Company nor any of its Subsidiaries is a guarantor or
        indemnitor of any indebtedness of any other Person.

12.8 Changes.

        Since July 31, 2004, except as disclosed in any Exchange Act Filing or
        in any Schedule to this Agreement or to any of the Ancillary
        Agreements, there has not been:

        (a) any change in the Company's or any of its Subsidiaries' business,
            assets, liabilities, condition (financial or otherwise),
            properties, operations or prospects, which, individually or in
            the aggregate, has had, or could reasonably be expected to have,
            a Material Adverse Effect;

        (b) any resignation or termination of any of the Company's or its
            Subsidiaries' officers, key employees or groups of employees;

        (c) any material change, except in the ordinary course of business,
            in the Company's or any of its Subsidiaries' contingent obligations
            by way of guaranty, endorsement, indemnity, warranty or otherwise;

        (d) any damage, destruction or loss, whether or not covered by
            insurance, which has had, or could reasonably be expected to have,
            individually or in the aggregate, a Material Adverse Effect;

        (e) any waiver by the Company's or any of its Subsidiaries of a
            valuable right or of a material debt owed to it;

        (f) any direct or indirect material loans made by the Company or any
            of its Subsidiaries to any of its or any of its Subsidiaries'
            stockholders, employees, officers or directors, other than advances
            made in the ordinary course of business;

                                       19
<PAGE>

        (g) any material change in any compensation arrangement or agreement
            with any employee, officer, director or stockholder;

        (h) any declaration or payment of any dividend or other distribution of
            the Company's or any of its Subsidiaries' assets;

        (i) any labor organization activity related to the Company or any of
            its Subsidiaries;

        (j) any debt, obligation or liability incurred, assumed or guaranteed
            by the Company or any of its Subsidiaries, except those for
            immaterial amounts and for current liabilities incurred in the
            ordinary course of business;

        (k) any sale, assignment or transfer of any Intellectual Property or
            other intangible assets;

        (l) any change in any material agreement to which the Company or any
            of its Subsidiaries is a party or by which either the Company or
            any of its Subsidiaries is bound which, either individually or in
            the aggregate, has had, or could reasonably be expected to have,
            individually or in the aggregate, a Material Adverse Effect;

        (m) any other event or condition of any character that, either
            individually or in the aggregate, has had, or could reasonably be
            expected to have, individually or in the aggregate, a Material
            Adverse Effect; or

        (n) any arrangement or commitment by the Company or any of its
            Subsidiaries to do any of the acts described in subsection (a)
            through (m) of this Section 12.8.

12.9 Title to Properties and Assets; Liens, Etc.

        Except as set forth on Schedule 12.9, the Company and each of its
        Subsidiaries has good and marketable title to their respective
        properties and assets, and good title to its leasehold interests, in
        each case subject to no Lien, other than Permitted Liens.

        All facilities, Equipment, Fixtures, vehicles and other properties
        owned, leased or used by the Company or any of its Subsidiaries are
        in good operating condition and repair and are reasonably fit and
        usable for the purposes for which they are being used.  Except as set
        forth on Schedule 12.9,  the Company and each of its Subsidiaries
        is in compliance with all material terms of each lease to which it
        is a party or is otherwise bound.

12.10 Intellectual Property.

        (a) The Company and each of its Subsidiaries owns or possesses
            sufficient legal rights to all Intellectual Property necessary
            for their respective businesses as now conducted and, to their
            knowledge as presently proposed to be conducted, without any
            known infringement of the rights of others.  There are no
            outstanding options, licenses or agreements of any kind
            relating to Company's or any of its Subsidiary's Intellectual
            Property, nor is its or any of its Subsidiaries bound by or a
            party to any options, licenses or agreements of any kind with
            respect to the Intellectual Property of any other Person other
            than such licenses or agreements arising from the purchase of
            "off the shelf" or standard products.

                                       20
<PAGE>

        (b) Neither the Company nor any of its Subsidiaries has received
            any communications alleging that the Company or any of its
            Subsidiaries has violated any of the Intellectual Property or
            other proprietary rights of any other Person, nor is the Company
            or any of its Subsidiaries aware of any basis therefor.

        (c) Neither the Company nor any of its Subsidiaries believes it is
            or will be necessary to utilize any inventions, trade secrets or
            proprietary information of any of its employees made prior to
            their employment by it or any of its Subsidiaries, except for
            inventions, trade secrets or proprietary information that have
            been rightfully assigned to it or any of its Subsidiaries.

12.11 Compliance with Other Instruments.

        Neither the Company nor any of its Subsidiaries is in violation or
        default of (x) any term of its Charter or Bylaws, or (y) any provision
        of any indebtedness, mortgage, indenture, contract, agreement or
        instrument to which it is party or by which it is bound or of any
        judgment, decree, order or writ, which violation or default, in
        the case of this clause (y), has had, or could reasonably be expected
        to have, either individually or in the aggregate, a Material Adverse
        Effect.  The execution, delivery and performance of and compliance
        with this Agreement and the Ancillary Agreements to which it is a
        party, and the issuance of the Notes and the other Securities each
        pursuant hereto and thereto, will not, with or without the passage
        of time or giving of notice, result in any such material violation,
        or be in conflict with or constitute a default under any such term
        or provision, or result in the creation of any Lien upon any of its
        or any of its Subsidiary's properties or assets or the suspension,
        revocation, impairment, forfeiture or nonrenewal of any permit,
        license, authorization or approval applicable to it or any of its
        Subsidiaries, their businesses or operations or any of their assets
        or properties.

12.12 Litigation.

        Except as set forth on Schedule 12.12, there is no action, suit,
        proceeding or investigation pending or, to its knowledge, currently
        threatened against the Company or any of its Subsidiaries that
        prevents the Company or any of its Subsidiaries from entering into
        this Agreement or the Ancillary Agreements, or from consummating
        the transactions contemplated hereby or thereby, or which has had,
        or could reasonably be expected to have, either individually or in
        the aggregate, a Material Adverse Effect, or could result in any
        change in its or any of its Subsidiaries' current equity ownership,
        nor is it aware that there is any basis to assert any of the
        foregoing.  Neither the Company nor any of its Subsidiaries is a
        party to or subject to the provisions of any order, writ,
        injunction, judgment or decree of any court or government agency
        or instrumentality.  There is no action, suit, proceeding or
        investigation by the Company or any of its Subsidiaries currently
        pending or which the Company or any of its Subsidiaries intends to
        initiate.

                                       21
<PAGE>

12.13 Tax Returns and Payments.

        The Company and each of its Subsidiaries  has timely filed all tax
        returns (federal, state, provincial and local) required to be filed
        by it.  All taxes shown to be due and payable on such returns, any
        assessments imposed, and all other taxes due and payable by the
        Company and each of its Subsidiaries  on or before the Closing
        Date, have been paid or will be paid prior to the time they become
        delinquent.  Except as set forth on Schedule 12.13, neither the
        Company nor any of its Subsidiaries has been advised:

        (a) that any of its returns, federal, state, provincial or other,
            have been or are being audited as of the date hereof; or

        (b) of any adjustment, deficiency, assessment or court decision in
            respect of its federal, state, provincial or other taxes.

        Neither the Company nor any of its Subsidiaries has any knowledge of
        any liability of any tax to be imposed upon its properties or assets
        as of the date of this Agreement that is not adequately provided for.

12.14 Employees.

        Except as set forth on Schedule 12.14, neither the Company nor any of
        its Subsidiaries has any collective bargaining agreements with any of
        its employees.  There is no labor union organizing activity pending or,
        to its knowledge, threatened with respect to it or any of its
        Subsidiaries.  Except as disclosed in the Exchange Act Filings or
        on Schedule 12.14, neither the Company nor any of its Subsidiaries
        is a party to or bound by any currently effective employment contract,
        deferred compensation arrangement, bonus plan, incentive plan, profit
        sharing plan, retirement agreement or other employee compensation
        plan or agreement for its executive officers.  To its knowledge,
        none of its or any of its Subsidiaries' employees, nor any consultant
        with whom the Company or any of its Subsidiaries has contracted, is in
        material violation of any term of any employment contract, proprietary
        information agreement or any other agreement relating to the right of
        any such individual to be employed by, or to contract with, the
        Company or any of its Subsidiaries because of the nature of the
        business to be conducted by it or any of its Subsidiaries; and to
        its knowledge the continued employment by it and its Subsidiaries
        of their present employees, and the performance of its and its
        Subsidiaries contracts with its independent contractors, will not
        result in any such violation.  Neither the Company nor any of its
        Subsidiaries is aware that any of its or any of its Subsidiaries'
        employees is obligated under any contract (including licenses,
        covenants or commitments of any nature) or other agreement, or
        subject to any judgment, decree or order of any court or
        administrative agency that would interfere with their duties
        to it or any of its Subsidiaries.  Neither the Company nor any
        of its Subsidiaries has received any notice alleging that any
        such violation has occurred.  Except for employees who have a
        current effective employment agreement with it or any of its
        Subsidiaries, none of its or any of its Subsidiaries' employees has
        been granted the right to continued employment by the Company or any
        of its Subsidiaries or to any material compensation following
        termination of employment with it or any of its Subsidiaries.  Except
        as set forth on Schedule 12(n), neither the Company nor any of its
        Subsidiaries is aware that any officer, key employee or group of
        employees intends to terminate his, her or their employment with it
        or any of its Subsidiaries, as applicable, nor does the Company or
        any of its Subsidiaries have a present intention to terminate the
        employment of any officer, key employee or group of employees.

                                       22
<PAGE>

12.15 Registration Rights and Voting Rights.

        Except as set forth on Schedule 12.15 and except as disclosed in
        Exchange Act Filings, neither the Company nor any of its Subsidiaries
        is presently under any obligation, and neither the Company nor any of
        its Subsidiaries has granted any rights, to register any of its or
        any of its Subsidiaries' presently outstanding securities or any of
        its securities that may hereafter be issued.  Except as set forth on
        Schedule 12.15 and except as disclosed in Exchange Act Filings, to its
        knowledge, none of its or any of its Subsidiaries' stockholders has
        entered into any agreement with respect to its or any of its
        Subsidiaries' voting of equity securities.

12.16 Compliance with Laws; Permits.

        Neither the Company nor any of its Subsidiaries is in violation,
        as applicable, of the Sarbanes-Oxley Act of 2002, any applicable
        Canadian corporate governance law or any SEC related regulation or
        rule or any rule of the Principal Market promulgated thereunder or
        any other applicable statute, rule, regulation, order or restriction
        of any domestic or foreign government or any instrumentality or
        agency thereof in respect of the conduct of its business or the
        ownership of its properties which has had, or could reasonably be
        expected to have, either individually or in the aggregate, a Material
        Adverse Effect.  No governmental orders, permissions, consents,
        approvals or authorizations are required to be obtained and no
        registrations or declarations are required to be filed in connection
        with the execution and delivery of this Agreement or any Ancillary
        Agreement and the issuance of any of the Securities, except such as
        have been duly and validly obtained or filed, or with respect to any
        filings that must be made after the Closing Date, as will be filed
        in a timely manner.  The Company and each of its Subsidiaries  has
        all material franchises, permits, licenses and any similar authority
        necessary for the conduct of its business as now being conducted by
        it, the lack of which could, either individually or in the aggregate,
        reasonably be expected to have a Material Adverse Effect.

12.17 Environmental and Safety Laws.

        Neither the Company nor any of its Subsidiaries is in violation of
        any applicable statute, law or regulation relating to the environment
        or occupational health and safety, and to its knowledge, no material
        expenditures are or will be required in order to comply with any such
        existing statute, law or regulation.  Except as set forth on
        Schedule 12.17, no Hazardous Materials (as defined below) are used
        or have been used, stored, or disposed of by the Company or any of
        its Subsidiaries or, to its knowledge, by any other Person on any
        property owned, leased or used by it or any of its Subsidiaries.
        For the purposes of the preceding sentence, "Hazardous Materials"
        shall mean:

        (a) materials which are listed or otherwise defined as "hazardous"
            or "toxic" under any applicable local, state, federal and/or
            foreign laws and regulations that govern the existence and/or
            remedy of contamination on property, the protection of the
            environment from contamination, the control of hazardous wastes,
            or other activities involving hazardous substances, including
            building materials; and

                                       23
<PAGE>

        (b) any petroleum products or nuclear materials.

12.18 Valid Offering.

        Assuming the accuracy of the representations and warranties of
        Laurus contained in this Agreement and the securities are issued as
        contemplated by this Agreement, the offer and issuance of the
        Securities will be exempt from the registration requirements of the
        Securities Act of 1933, as amended (the "Securities Act"), and will
        have been registered or qualified (or are exempt from registration
        and qualification) under the registration, permit or qualification
        requirements of all applicable state securities laws.

12.19 Full Disclosure.

        The Company and each of its Subsidiaries has provided Laurus with
        all information requested by Laurus in connection with Laurus'
        decision to enter into this Agreement.  Neither this Agreement, the
        Ancillary Agreements nor the exhibits and schedules hereto and
        thereto nor any other document delivered by the Company or any of
        its Subsidiaries to Laurus or its attorneys or agents in connection
        herewith or therewith or with the transactions contemplated hereby
        or thereby, contain any untrue statement of a material fact nor omit
        to state a material fact necessary in order to make the statements
        contained herein or therein, in light of the circumstances in which
        they are made, not misleading.,  Any financial projections and other
        estimates provided to Laurus by the Company or any of its Subsidiaries
        were based on its and its Subsidiaries' experience in the industry
        and on assumptions of fact and opinion as to future events which it
        or any of its Subsidiaries, at the date of the issuance of such
        projections or estimates, believed to be reasonable.

12.20 Insurance.

        The Company and each of its Subsidiaries has general commercial,
        product liability, fire and casualty insurance policies with coverage
        which it believes are customary for companies similarly situated to it
        and its Subsidiaries in the same or similar business.

12.21 SEC Reports and Financial Statements.

        Except as set forth on Schedule 12.21, the Company and each of its
        Subsidiaries has filed all proxy statements, reports and other
        documents required to be filed by it under the Exchange Act.   The
        Company has made available or furnished Laurus with copies of:
        (i) its Annual Report on Form 10-KSB for its fiscal years ended
        July 31, 2004; and (ii) its Quarterly Reports on Form 10-QSB for
        its fiscal quarters ended April 30, 2005, January 31, 2005 and
        April 30, 2004, and the Form 8-K filings which it has made during

                                       24
<PAGE>

        its fiscal year 2005 to date (collectively, the "SEC Reports").
        Except as set forth on Schedule 12.21, each SEC Report was, at
        the time of its filing, in substantial compliance with the
        requirements of its respective form and none of the SEC Reports,
        nor the financial statements (and the notes thereto) included in
        the SEC Reports, as of their respective filing dates, contained
        any untrue statement of a material fact or omitted to state a
        material fact required to be stated therein or necessary to make
        the statements therein, in light of the circumstances under which
        they were made, not misleading.  Such financial statements have
        been prepared in accordance with GAAP applied on a consistent
        basis during the periods involved (except (i) as may be otherwise
        indicated in such financial statements or the notes thereto or
        (ii) in the case of unaudited interim statements, to the extent
        they may not include footnotes or may be condensed) and fairly
        present in all material respects the financial condition, the
        results of operations and cash flows of the Company and its
        Subsidiaries, on a consolidated basis, as of, and for, the periods
        presented in each such SEC Report.

12.22 Listing.

        The Company's Common Stock is listed or quoted, as applicable, on
        the Principal Market and satisfies all requirements for the
        continuation of such listing or quotation, as applicable, and
        the Company shall do all things necessary for the continuation of
        such listing or quotation, as applicable.   The Company has not
        received any notice that its Common Stock will be delisted from,
        or no longer quoted on, as applicable, the Principal Market or that
        its Common Stock does not meet all requirements for such listing
        or quotation, as applicable.

12.23 No Integrated Offering.

        Neither it, nor any of its Subsidiaries nor any of its Affiliates,
        nor any Person acting on its or their behalf, has directly or
        indirectly made any offers or sales of any security or solicited
        any offers to buy any security under circumstances that would cause
        the offering of the Securities pursuant to this Agreement or any
        Ancillary Agreement to be integrated with prior offerings by it
        for purposes of the Securities Act which would prevent it from
        issuing the Securities pursuant to Rule 506 under the Securities
        Act, or any applicable exchange-related stockholder approval
        provisions, nor will it or any of its Affiliates or Subsidiaries
        take any action or steps that would cause the offering of the
        Securities to be integrated with other offerings.

12.24 Stop Transfer.

        The Securities are restricted securities as of the date of this
        Agreement.  Neither the Company nor any of its Subsidiaries will
        issue any stop transfer order or other order impeding the sale
        and delivery of any of the Securities at such time as the Securities
        are registered for public sale or an exemption from registration
        is available, except as required by law.

                                       25
<PAGE>

12.25 Dilution.

        It specifically acknowledges that the Company's obligation to issue
        the shares of Common Stock upon conversion of the Notes and exercise
        of the Warrants is binding upon  the Companyand enforceable regardless
        of the dilution such issuance may have on the ownership interests of
        other shareholders of the Company.

12.26 Patriot Act.

        It certifies that, to the best of its knowledge, neither the Company
        nor any of its Subsidiaries has been designated, nor is or shall be
        owned or controlled, by a "suspected terrorist" as defined in Executive
        Order 13224.  It hereby acknowledges that Laurus seeks to comply with
        all applicable laws concerning money laundering and related activities.
        In furtherance of those efforts, it hereby represents, warrants and
        covenants that:  (i) none of the cash or property that the Company
        or any of its Subsidiaries will pay or will contribute to Laurus has
        been or shall be derived from, or related to, any activity that is
        deemed criminal under United States law; and (ii) no contribution or
        payment by the Company or any of its Subsidiaries to Laurus, to the
        extent that they are within its or any such Subsidiary's control
        shall cause Laurus to be in violation of the United States Bank
        Secrecy Act, the United States International Money Laundering Control
        Act of 1986 or the United States International Money Laundering
        Abatement and Anti-Terrorist Financing Act of 2001 or the Canadian
        Proceeds of Crime (Money Laundering) and Terrorist Financing Act.
        It shall promptly notify Laurus if any of these representations,
        warranties and covenants ceases to be true and accurate regarding
        it or any of its Subsidiaries.  It shall provide Laurus with any
        additional information regarding it and each Subsidiary thereof
        that Laurus deems necessary or convenient to ensure compliance
        with all applicable laws concerning money laundering and similar
        activities.  It understands and agrees that if at any time it is
        discovered that any of the foregoing representations, warranties
        and covenants are incorrect, or if otherwise required by applicable
        law or regulation related to money laundering or similar activities,
        Laurus may undertake appropriate actions to ensure compliance with
        applicable law or regulation, including but not limited to
        segregation and/or redemption of Laurus' investment in it.  It
        further understands that Laurus may release confidential information
        about it and its Subsidiaries and, if applicable, any underlying
        beneficial owners, to proper authorities if Laurus, in its sole
        discretion, determines that it is in the best interests of Laurus
        in light of relevant rules and regulations under the laws set
        forth in subsection (ii) above.

12.27 Company Name; Locations of Offices, Records and Collateral.

        Schedule 12.27 sets forth  the Company's name as it appears in
        official filings in the state of its organization, the type of
        entity of  the Company, the organizational identification number
        issued by  the Company's state of organization or a statement that
        no such number has been issued,  the Company's state of organization,
        and the location of  the Company's chief executive office, corporate
        offices, warehouses, other locations of Collateral and locations
        where records with respect to Collateral are kept (including in each
        case the county of such locations) and, except as set forth in such
        Schedule 12.27, such locations have not changed during the preceding
        twelve months.  As of the Closing Date, during the prior five years,
        except as set forth in Schedule 12.27 or described in its Exchange
        Act filings, the Company has not been known as or conducted business
        in any other name.   The Company is incorporated in Delaware.

                                       26
<PAGE>

12.28 ERISA.

        To the extent subject thereto, the Company, based upon the Employee
        Retirement Income Security Act of 1974 ("ERISA"), and the regulations
        and published interpretations thereunder:  (i) neither the Company
        nor any of its Subsidiaries, to the extent subject thereto, has
        engaged in any Prohibited Transactions (as defined in Section 406
        of ERISA and Section 4975 of the Code); (ii) to the extent subject
        thereto, the Company and each of its Subsidiaries  has met all
        applicable minimum funding requirements under Section 302 of ERISA
        in respect of its plans; (iii) neither the Company nor any of its
        Subsidiaries has any knowledge of any event or occurrence which
        would cause the Pension Benefit Guaranty Corporation to institute
        proceedings under Title IV of ERISA to terminate any employee benefit
        plan(s); (iv) neither the Company nor any of its Subsidiaries has
        any fiduciary responsibility for investments with respect to any
        plan existing for the benefit of persons other than its or such
        Subsidiary's employees; and (v) neither the Company nor any of
        its Subsidiaries has withdrawn, completely or partially, from any
        multi-employer pension plan so as to incur liability under the
        Multiemployer Pension Plan Amendments Act of 1980.
..

12.29  The Company and its Subsidiaries maintains or contributes to any
       Canadian Pension Plan.

                                  Article 13

COVENANTS.

        The Company covenants and agrees with Laurus as follows:

13.1 Stop-Orders.

        It shall advise Laurus, promptly after it receives notice of issuance
        by the SEC, any state securities commission or any other regulatory
        authority of any stop order or of any order preventing or suspending
        any offering of any securities of the Company, or of the suspension
        of the qualification of the Common Stock of  the Companyfor offering
        or sale in any jurisdiction, or the initiation of any proceeding for
        any such purpose.

13.2 Listing.

        It shall promptly secure the listing or quotation, as applicable, of
        the shares of Common Stock issuable upon conversion of the Notes and
        exercise of the Warrants on the Principal Market upon which shares of
        Common Stock are listed or quoted, as applicable, (subject to official
        notice of issuance) and shall maintain such listing or quotation, as
        applicable, so long as any other shares of Common Stock shall be so
        listed or quoted, as applicable.   the Companyshall maintain the
        listing or quotation, as applicable, of its Common Stock on the
        Principal Market, and will comply in all material respects with the
        Company's reporting, filing and other obligations under the bylaws
        or rules of the National Association of Securities Dealers ("NASD")
        and such exchanges, as applicable.

                                       27
<PAGE>

13.3 Reserved.

13.4 Reporting Requirements.

        It shall timely file with the SEC all reports required to be filed
        pursuant to the Exchange Act and refrain from terminating its status
        as an issuer required by the Exchange Act to file reports thereunder
        even if the Exchange Act or the rules or regulations thereunder would
        permit such termination until at least such time as this Agreement
        terminates.

13.5 Use of Funds.

        It shall use the proceeds of the Loans for general working capital
        purposes and to fund an inter-company loan to the Eligible Subsidiary
        and to acquire Infinity Technologies Inc. only and to pay off a debt
        to Dutchess.

13.6 Access to Facilities.

        It shall, and shall cause each of its Subsidiaries to, permit any
        representatives designated by Laurus (or any successor of Laurus),
        upon reasonable notice and during normal business hours at Company's
        expense, and accompanied by a representative of  the Company(provided
        that no such prior notice shall be required to be given and no such
        representative shall be required to accompany Laurus in the event
        Laurus believes such access is necessary to preserve or protect the
        Collateral or following the occurrence and during the continuance
        of an Event of Default), to:

        (a) visit and inspect any of its or any such Subsidiary's properties;

        (b) examine its or any such Subsidiary's corporate and financial
            records (unless such examination is not permitted by federal,
            state or local law or by contract) and make copies thereof or
            extracts therefrom; and

        (c) discuss its or any such Subsidiary's affairs, finances and
            accounts with its or any such Subsidiary's directors, officers
            and Accountants.

        Notwithstanding the foregoing, neither the Company nor any of its
        Subsidiaries shall provide any material, non-public information to
        Laurus unless Laurus signs a confidentiality agreement and otherwise
        complies with Regulation FD and insider trading laws, under the
        federal securities laws.

                                       28
<PAGE>

13.7 Taxes.

        It shall, and shall cause each of its Subsidiaries to, promptly pay
        and discharge, or cause to be paid and discharged, when due and
        payable, all lawful taxes, assessments and governmental charges or
        levies imposed upon it and its Subsidiaries' income, profits, property
        or business, as the case may be; provided, however, that any such tax,
        assessment, charge or levy need not be paid currently if (i) the
        validity thereof shall currently and diligently be contested in good
        faith by appropriate proceedings, (ii) such tax, assessment, charge or
        levy shall have no effect on the Lien priority of Laurus in the
        Collateral, and (iii) if it and/or such Subsidiary, as applicable,
        shall have set aside on its and/or such Subsidiary's books adequate
        reserves with respect thereto in accordance with GAAP; and provided,
        further, that it shall, and shall cause each of its Subsidiaries to,
        pay all such taxes, assessments, charges or levies forthwith upon the
        commencement of proceedings to foreclose any lien which may have
        attached as security therefor.

13.8 Insurance.

        It shall bear the full risk of loss from any loss of any nature
        whatsoever with respect to the Collateral.  The Company and each of its
        Subsidiaries  shall keep its assets which are of an insurable
        character insured by financially sound and reputable insurers against
        loss or damage by fire, explosion and other risks customarily insured
        against by companies in similar business similarly situated as it and
        its Subsidiaries; and it and its Subsidiaries shall maintain, with
        financially sound and reputable insurers, insurance against other
        hazards and risks and liability to persons and property to the extent
        and in the manner which it and/or such Subsidiary thereof reasonably
        believes is customary for companies in similar business similarly
        situated as it and its Subsidiaries and to the extent available on
        commercially reasonable terms.  The Company and each of its
        Subsidiaries  will cause Laurus to be named as first loss payee or
        additional insured on all of the policies of insurance relating to
        the assets pledged to Laurus as security for its obligations
        hereunder and under the Ancillary Agreements.  At its own cost and
        expense in amounts and with carriers reasonably acceptable to Laurus,
        the Company and each of its Subsidiaries  shall (i) keep all their
        insurable properties and properties in which they have an interest
        insured against the hazards of fire, flood, sprinkler leakage, those
        hazards covered by extended coverage insurance and such other hazards,
        and for such amounts, as is customary in the case of companies
        engaged in businesses similar to it or the respective Subsidiary's
        including business interruption insurance; (ii) maintain a bond in
        such amounts as is customary in the case of companies engaged in
        businesses similar to it and its Subsidiaries' insuring against
        larceny, embezzlement or other criminal misappropriation of insured's
        officers and employees who may either singly or jointly with others
        at any time have access to its or any of its Subsidiaries assets or
        funds either directly or through governmental authority to draw upon
        such funds or to direct generally the disposition of such assets;
        (iii) maintain public and product liability insurance against

                                       29
<PAGE>

        claims for personal injury, death or property damage suffered by
        others; (iv) maintain all such worker's compensation or similar
        insurance as may be required under the laws of any state or
        jurisdiction in which the Company or any of its Subsidiaries is
        engaged in business; and (v) furnish Laurus with (x) copies of all
        policies and evidence of the maintenance of such policies at least
        thirty (30) days before any expiration date, (y) excepting its and
        its Subsidiaries' workers' compensation policy, endorsements to such
        policies naming Laurus as "co-insured" or "additional insured" and
        appropriate loss payable endorsements in form and substance
        satisfactory to Laurus, naming Laurus as lenders loss payee, and
        (z) evidence that as to Laurus the insurance coverage shall not be
        impaired or invalidated by any act or neglect of the Company or any
        of its Subsidiaries and the insurer will provide Laurus with at least
        thirty (30) days notice prior to cancellation.  It shall instruct the
        insurance carriers that in the event of any loss thereunder, the
        carriers shall make payment for such loss to Laurus and not to the
        Company or any of its Subsidiaries and Laurus jointly.  If any
        insurance losses are paid by check, draft or other instrument payable
        to the Company and/or any of its Subsidiaries and Laurus jointly,
        Laurus may endorse, as applicable, the Company's and/or any of its
        Subsidiaries' name thereon and do such other things as Laurus may
        deem advisable to reduce the same to cash.  Laurus is hereby authorized
        to adjust and compromise claims.  All loss recoveries received by
        Laurus upon any such insurance may be applied to the Obligations,
        in such order as Laurus in its sole discretion shall determine or
        shall otherwise be delivered to  the Companyfor the benefit of the
        applicable Company and/or its Subsidiaries.  Any surplus shall be
        paid by Laurus to  the Companyfor the benefit of the applicable
        Company and/or its Subsidiaries, or applied as may be otherwise
        required by law.  Any deficiency thereon shall be paid, as
        applicable, by Companies and their Subsidiaries to Laurus, on demand.

13.9 Intellectual Property.

        It shall, and shall cause each of its Subsidiaries to, maintain in
        full force and effect its corporate existence, rights and franchises
        and all licenses and other rights to use Intellectual Property owned
        or possessed by it and reasonably deemed to be necessary to the conduct
        of its business.

13.10 Properties.

        It shall, and shall cause each of its Subsidiaries to, keep its
        properties in good repair, working order and condition, reasonable wear
        and tear excepted, and from time to time make all needful and proper
        repairs, renewals, replacements, additions and improvements thereto;
        and it shall, and shall cause each of its Subsidiaries to, at all times
        comply with each provision of all leases to which it is a party or
        under which it occupies property if the breach of such provision could
        reasonably be expected to have a Material Adverse Effect.

                                       30
<PAGE>

13.11 Confidentiality.

        It shall not, and shall not permit any of its Subsidiaries to,
        disclose, and will not include in any public announcement, the name of
        Laurus, unless expressly agreed to by Laurus or unless and until such
        disclosure is required by law or applicable regulation, and then only
        to the extent of such requirement.  Notwithstanding the foregoing,  the
        Company and its Subsidiaries may disclose Laurus' identity and the
        terms of this Agreement to its current and prospective debt and equity
        financing sources.

13.12 Required Approvals.

        It shall not, and shall not permit any of its Subsidiaries to, without
        the prior written consent of Laurus, (i) create, incur, assume or
        suffer to exist any indebtedness (exclusive of trade debt) whether
        secured or unsecured other than  the Company's indebtedness to Laurus
        and as set forth on Schedule 13.12 attached hereto and made a part
        hereof; (ii) cancel any debt owing to it in excess of US$50,000 in the
        aggregate during any 12 month period; (iii) assume, guarantee, endorse
        or otherwise become directly or contingently liable in connection with
        any obligations of any other Person, except the endorsement of
        negotiable instruments by it or its Subsidiaries for deposit or
        collection or similar transactions in the ordinary course of business;
        (iv) directly or indirectly declare, pay or make any dividend or
        distribution on any class of its Stock or apply any of its funds,
        property or assets to the purchase, redemption or other retirement of
        any of its or its Subsidiaries' Stock outstanding on the date hereof,
        or issue any preferred stock; (v) purchase or hold beneficially any
        Stock (except stock issued pursuant to the Vital Baby Transaction, upon
        the terms and subject to the conditions disclosed to Laurus on the
        date hereof and set forth on the Company's 8-K filing dated
        July 5, 2005) or other securities or evidences of indebtedness of,
        make or permit to exist any loans or advances to, or make any
        investment or acquire any interest whatsoever in, any other Person,
        including any partnership or joint venture, except (x) travel
        advances, (y) loans to its and its Subsidiaries' officers and
        employees not exceeding at any one time an aggregate of US$10,000,
        and (z) loans to its existing Subsidiaries so long as such
        Subsidiaries are designated as either a co-borrower hereunder or
        has entered into such guaranty and security documentation required
        by Laurus, including, without limitation, to grant to Laurus a
        first priority perfected security interest in substantially all
        of such Subsidiary's assets to secure the Obligations; (vi) create
        or permit to exist any Subsidiary, other than any Subsidiary in
        existence on the date hereof and listed in Schedule 12.2 unless
        such new Subsidiary is a wholly-owned Subsidiary and is designated
        by Laurus as either a co-borrower or guarantor hereunder and such
        Subsidiary shall have entered into all such documentation required
        by Laurus, including, without limitation, to grant to Laurus a first
        priority perfected security interest in substantially all of such
        Subsidiary's assets to secure the Obligations; (vii) directly or
        indirectly, prepay any indebtedness (other than to Laurus and in
        the ordinary course of business), or repurchase, redeem, retire or
        otherwise acquire any indebtedness (other than to Laurus and in the
        ordinary course of business) except to make scheduled payments of
        principal and interest thereof; (viii) enter into any merger,
        consolidation or other reorganization with or into any other Person
        or acquire all or a portion of the assets or Stock of any Person or

                                       31
<PAGE>

        permit any other Person to consolidate with or merge with it,
        unless (1) the Company is the surviving entity of such merger or
        consolidation, (2) no Event of Default shall exist immediately prior
        to and after giving effect to such merger or consolidation, (3) the
        Company shall have provided Laurus copies of all documentation
        relating to such merger or consolidation and (4) the Company shall
        have provided Laurus with at least thirty (30) days' prior written
        notice of such merger or consolidation; (ix) materially change the
        nature of the business in which it is presently engaged; (x) become
        subject to (including, without limitation, by way of amendment to or
        modification of) any agreement or instrument which by its terms
        would (under any circumstances) restrict its or any of its
        Subsidiaries' right to perform the provisions of this Agreement
        or any of the Ancillary Agreements; (xi) change its fiscal year
        or make any changes in accounting treatment and reporting practices
        without prior written notice to Laurus except as required by GAAP or
        in the tax reporting treatment or except as required by law; (xii)
        enter into any transaction with any employee, director or Affiliate,
        except in the ordinary course on arms-length terms; (xiii) bill
        Accounts under any name except the present name of the Company and
        its other trade names; or (xiv) sell, lease, transfer or otherwise
        dispose of any of its properties or assets, or any of the properties
        or assets of its Subsidiaries, except for (1) routine leases in the
        ordinary course of business; (2) the sale of Inventory in the
        ordinary course of business and (3) the disposition or transfer
        in the ordinary course of business during any fiscal year of
        obsolete and worn-out Equipment and only to the extent that (x)
        the proceeds of any such disposition are used to acquire replacement
        Equipment which is subject to Laurus' first priority security
        interest or are used to repay Loans or to pay general corporate
        expenses, or (y) following the occurrence of an Event of Default
        which continues to exist, the proceeds of which are remitted to
        Laurus to be held as cash collateral for the Obligations.

13.13 Reissuance of Securities.

        The Company shall reissue certificates representing the Securities
        without the legends set forth in Article 39 below at such time as:

        (a) the holder thereof is permitted to dispose of such Securities
            pursuant to Rule 144(k) under the Securities Act if the holder
            otherwise complies with Rule 144(k); or

        (b) upon resale subject to an effective registration statement after
            such Securities are registered under the Securities Act.

        The Company agrees to cooperate with Laurus in connection with all
        resales pursuant to Rule 144(d) and Rule 144(k) and provide legal
        opinions necessary to allow such resales provided  the Company and
        its counsel receive the representations and information necessary
        for a Rule 144 sale  from Laurus and its broker.

                                       32
<PAGE>

13.14 Opinion.

        On the Closing Date, it shall deliver to Laurus an opinion acceptable
        to Laurus from  the Company's legal counsel.   The Company will
        provide such other legal opinions in the future as are reasonably
        necessary for the conversion of the Notes and the exercise of the
        Warrants if Laurus provides the appropriate documentation and
        representations to support such legal opinions.

13.15 Legal Name, etc.

        It shall not, without providing Laurus with 30 days prior written
        notice, change (i) its name as it appears in the official filings in
        the jurisdiction of its organization, (ii) the type of legal entity
        it is, (iii) its organization identification number, if any, issued by
        its jurisdiction of organization, (iv) its jurisdiction of organization
        or (v) amend its certificate of incorporation, by-laws or other
        organizational document.

13.16 Compliance with Laws.

        The operation of each of its and each of its Subsidiaries' business is
        and shall continue to be in  compliance in all material respects with
        all applicable federal, state and local laws, rules and ordinances,
        including to all laws, rules, regulations and orders relating to taxes,
        payment and withholding of payroll taxes, employer and employee
        contributions and similar items, securities, employee retirement and
        welfare benefits, employee health and safety and environmental matters.

13.17 Notices.

        The Company and each of its Subsidiaries shall promptly inform Laurus
        in writing of:  (i) to its knowledge, the commencement of all
        proceedings and investigations by or before and/or the receipt of any
        notices from, any governmental or nongovernmental body and all actions
        and proceedings in any court or before any arbitrator against or in any
        way concerning any event which could reasonably be expected to have
        singly or in the aggregate, a Material Adverse Effect; (ii) any change
        which has had, or could reasonably be expected to have, a Material
        Adverse Effect; (iii) to the Company's knowledge, any Event of Default
        or Default in contracts entered into by the Company or its Subsidiaries
        which could reasonably be expected to have a Material Adverse Effect;
        and (iv) any default or any event which with the passage of time or
        giving of notice or both would constitute a default under any agreement
        for the payment of money to which the Company or any of its
        Subsidiaries is a party or by which the Company or any of its
        Subsidiaries or any of its or any such Subsidiary's properties may be
        bound the breach of which would have a Material Adverse Effect.

13.18 Margin Stock.

        It shall not permit any of the proceeds of the Loans made hereunder to
        be used directly or indirectly to "purchase" or "carry" "margin stock"
        or to repay indebtedness incurred to "purchase" or "carry" "margin
        stock" within the respective meanings of each of the quoted terms under
        Regulation U of the Board of Governors of the Federal Reserve System as
        now and from time to time hereafter in effect.

                                       33
<PAGE>

13.19 Offering Restrictions.

        Except as previously disclosed in the SEC Reports or in the Exchange
        Act Filings, or registered or restricted stock or stock options granted
        to its employees, directors or consultants, neither the Company nor any
        of its Subsidiaries shall, prior to the full repayment or conversion of
        the Notes (together with all accrued and unpaid interest and fees
        related thereto), (x) enter into any equity line of credit agreement
        or similar agreement or (y) issue, or enter into any agreement to
        issue, any securities with a variable/floating conversion and/or
        pricing feature which are or could be (by conversion or registration)
        free-trading securities (i.e. common stock subject to a registration
        statement).

13.20 Authorization and Reservation of Shares.

        The Company shall at all times have authorized and reserved a
        sufficient number of shares of Common Stock to provide for the
        conversion of the Notes and exercise of the Warrants.

13.21 Financing Right of First Refusal.

        (a) It hereby grants to Laurus a right of first refusal for two years
            from the date of this Agreement to provide any Additional Financing
            (as defined below) to be issued by the Company and/or any of its
            Subsidiaries (the "Additional Financing Parties"), subject to the
            following terms and conditions.  From and after the date hereof,
            prior to the incurrence of any additional indebtedness and/or the
            sale or issuance of any equity interests of the Additional
            Financing Parties (an "Additional Financing"),  the Company shall
            notify Laurus of such Additional Financing.  In connection
            therewith, the Company shall submit a fully negotiated term sheet,
            substantially in final form (a "Proposed Term Sheet"), to Laurus
            setting forth the terms, conditions and pricing of any such
            Additional Financing (such financing to be negotiated on "arm's
            length" terms and the terms thereof to be negotiated in good
            faith) proposed to be entered into by the Additional Financing
            Parties.  Laurus shall have the right, but not the obligation,
            to deliver to the Company its own proposed term sheet (the
            "Laurus Term Sheet") setting forth the terms and conditions
            upon which Laurus would be willing to provide such Additional
            Financing to the Additional Financing Parties.  The Laurus
            Term Sheet shall contain terms no less favorable to the
            Additional Financing Parties than those outlined in Proposed
            Term Sheet.  Laurus shall deliver to  the Company the Laurus
            Term Sheet within  five (5) Business Days of receipt of each
            such Proposed Term Sheet.  If the provisions of the Laurus
            Term Sheet are at least as favorable to the Additional Financing
            Parties as the provisions of the Proposed Term Sheet, the
            Additional Financing Parties shall enter into and consummate
            the Additional Financing transaction outlined in the Laurus Term
            Sheet.   Notwithstanding the foregoing, the Company shall not be
            obligated to enter into any Additional Financing with Laurus or
            any third party whether or not Laurus exercises the right of
            first refusal, but may instead elect not to consummate any such
            Additional Financing.

                                       34
<PAGE>

        (b) It shall not, and shall not permit its Subsidiaries to, agree,
            directly or indirectly, to any restriction with any Person which
            limits the ability of Laurus to consummate an Additional
            Financing with it or any of its Subsidiaries.

13.22 Additional Investment.

        It agrees and acknowledges that Laurus shall have the right (at its
        sole option), on or prior to the date which is 270 calendar days
        following the Closing Date, to provide to the Company additional
        financing in an aggregate principal amount of up to US$2,200,000 on
        the same terms and conditions (including, without limitation, the same
        interest rate, the Fixed Conversion Price (as defined in each Note)
        then in effect, proportionate warrant coverage (at the same exercise
        prices, a proportionate amortization schedule, etc.) set forth in this
        Agreement and the Ancillary Agreements.  Laurus will notify the Company
        in writing fifteen (15) days prior to issuing additional financing
        pursuant to this section 13.22.

                                  Article 14

FURTHER ASSURANCES.

        At any time and from time to time, upon the written request of Laurus
        and at the sole expense of Company,  the Company shall promptly and
        duly execute and deliver any and all such further instruments and
        documents and take such further action as Laurus may request (a) to
        obtain the full benefits of this Agreement and the Ancillary
        Agreements, (b) to protect, preserve and maintain Laurus' rights in
        the Collateral and under this Agreement or any Ancillary Agreement,
        and/or (c) to enable Laurus to exercise all or any of the rights and
        powers herein granted or any Ancillary Agreement.

                                  Article 15

REPRESENTATIONS, WARRANTIES AND COVENANTS OF LAURUS.

        Laurus hereby represents, warrants and covenants to the Company
        as follows:

15.1 Requisite Power and Authority.

        Laurus has all necessary power and authority under all applicable
        provisions of law to execute and deliver this Agreement and the
        Ancillary Agreements and to carry out their provisions.  All
        corporate action on Laurus' part required for the lawful execution
        and delivery of this Agreement and the Ancillary Agreements have
        been or will be effectively taken prior to the Closing Date.
        Upon their execution and delivery and during the term of this
        Agreement, this Agreement and the Ancillary Agreements shall be
        valid and binding obligations of Laurus, enforceable in accordance
        with their terms, except (a) as limited by applicable bankruptcy,
        insolvency, reorganization, moratorium or other laws of general
        application affecting enforcement of creditors' rights, and (b)
        as limited by general principles of equity that restrict the
        availability of equitable and legal remedies.

                                       35
<PAGE>

15.2 Investment Representations.

        Laurus understands that the Securities are being offered pursuant
        to an exemption from registration contained in the Securities Act
        based in part upon Laurus' representations contained in this Agreement,
        including, without limitation, that Laurus is an "accredited investor"
        within the meaning of Regulation D under the Securities Act.  Laurus
        has received or has had full access to all the information it
        considers necessary or appropriate to make an informed investment
        decision with respect to the Notes and warrants to be issued to it
        under this Agreement and the Securities acquired by it upon the
        conversion of the Notes and warrants.

15.3 Laurus Bears Economic Risk.

        Laurus has substantial experience in evaluating and investing in
        private placement transactions of securities in companies similar
        to the Company so that it is capable of evaluating the merits and
        risks of its investment in  the Company and has the capacity to protect
        its own interests.  Laurus will bear the economic risk of this
        investment until the Securities are sold pursuant to (i) an effective
        registration statement under the Securities Act, or (ii) an exemption
        from registration is available.  Laurus acknowledges that the
        investment contemplated by this Agreement and the Ancillary Agreements
        is speculative and involves a high degree of risk.

15.4 Investment for Own Account.

        Laurus is acquiring the securities as a principal for its own account
        and not with a view to or for distributing or reselling such securities
        or any part thereof, has no present intention of distributing any of
        such securities and has no arrangement or understanding with any other
        persons regarding the distribution of such securities.  Laurus is
        acquiring the securities hereunder in the ordinary course of its
        business. Laurus does not have any agreement or understanding,
        directly or indirectly, with any entity or person to distribute
        any of the securities.

15.5 Laurus Can Protect Its Interest.

        Laurus represents that by reason of its, or of its management's,
        business and financial experience, Laurus has the capacity to evaluate
        the merits and risks of its investment in the Notes, and the Securities
        and to protect its own interests in connection with the transactions
        contemplated in this Agreement, and the Ancillary Agreements.
        Further, Laurus is aware of no publication of any advertisement
        in connection with the transactions contemplated in the Agreement
        or the Ancillary Agreements.

15.6 Accredited Investor.

        Laurus represents that it is an accredited investor within the
        meaning of Regulation D under the Securities Act.   Laurus is not
        required to be registered as a broker-dealer under Section 15 of
        the Exchange Act.

                                       36
<PAGE>

15.7 Shorting.

        Neither Laurus nor any of its Affiliates or investment partners has,
        will, or will cause any Person, to directly engage in "short sales"
        of the Company's Common Stock during the term of this Agreement or
        for as long as any Minimum Borrowing Note shall be outstanding,
        whichever is longer.

15.8 Patriot Act.

        Laurus certifies that, to the best of Laurus' knowledge, Laurus has
        not been designated, and is not owned or controlled, by a "suspected
        terrorist" as defined in Executive Order 13224.  Laurus seeks to
        comply with all applicable laws concerning money laundering and
        related activities.  In furtherance of those efforts, Laurus hereby
        represents, warrants and covenants that:  (i) none of the cash or
        property that Laurus will use to make the Loans has been or shall
        be derived from, or related to, any activity that is deemed criminal
        under United States law; and (ii) no disbursement by Laurus to the
        Company to the extent within Laurus' control, shall cause Laurus to
        be in violation of the United States Bank Secrecy Act, the United
        States International Money Laundering Control Act of 1986 or the
        United States International Money Laundering Abatement and
        Anti-Terrorist Financing Act of 2001 or the Canadian Proceeds of
        Crime (Money Laundering) and Terrorist Financing Act.  Laurus shall
        promptly notify the  Company if any of these representations ceases
        to be true and accurate regarding Laurus.  Laurus agrees to provide
        the Company any additional information regarding Laurus that the
        Company deems necessary or convenient to ensure compliance with all
        applicable laws concerning money laundering and similar activities.
        Laurus understands and agrees that if at any time it is discovered
        that any of the foregoing representations are incorrect, or if
        otherwise required by applicable law or regulation related to money
        laundering similar activities, Laurus may undertake appropriate
        actions to ensure compliance with applicable law or regulation,
        including but not limited to segregation and/or redemption of Laurus'
        investment in the Company.  Laurus further understands that the
        Company may release information about Laurus and, if applicable,
        any underlying beneficial owners, to proper authorities if the
        Company, in its sole discretion, determines that it is in the best
        interests of  the Company in light of relevant rules and regulations
        under the laws set forth in subsection (ii) above.

15.9 Limitation on Acquisition of Common Stock.

        Notwithstanding anything to the contrary contained in this Agreement,
        any Ancillary Agreement, or any document, instrument or agreement
        entered into in connection with any other transaction entered into
        by and between Laurus and the Company (and/or Subsidiaries or
        Affiliates of the Company), Laurus shall not acquire stock in the
        Company (including, without limitation, pursuant to a contract to
        purchase, by exercising an option or warrant, by converting any
        other security or instrument, by acquiring or exercising any other
        right to acquire, shares of stock or other security convertible
        into shares of stock in the Company, or otherwise, and such options,

                                       37
<PAGE>

        warrants, conversion or other rights shall not be exercisable) to the
        extent such stock acquisition would cause any interest (including
        any original issue discount) payable by the Company to Laurus not
        to qualify as portfolio interest, within the meaning of
        Section 881(c)(2) of the Internal Revenue Code of 1986, as amended
        (the "Code") by reason of Section 881(c)(3) of the Code, taking
        into account the constructive ownership rules under
        Section 871(h)(3)(C) of the Code (the "Stock Acquisition
        Limitation").  The Stock Acquisition Limitation shall
        automatically become null and void without any notice to the
        Company upon the earlier to occur of either (a) the Company's
        delivery to Laurus of a Notice of Redemption (as defined in the
        Notes) or (b) the existence of an Event of Default at a time
        when the average closing price of the Common Stock as reported
        by Bloomberg, L.P. on the Principal Market for the immediately
        preceding five trading days is greater than or equal to 150% of
        the Fixed Conversion Price (as defined in the Notes).

15.10 Reserved.

15.11 Laurus acknowledges that the Company has discussed its Vital Baby
      Transaction with Laurus and the transaction as contemplated by the
      Company will not violate this Agreement or the Ancillary agreements.
      Additionally, Laurus waives all notice provisions relating to the
      Vital Baby Transaction and by entering into this Agreement acknowledges
      that the Vital Baby Transaction will not cause an Event of Default
      or other breach of this Agreement of the Ancillary Agreements.

15.12 The execution, delivery and performance of this Agreement by Laurus and
      the consummation by Laurus of the transactions contemplated thereby and
      hereby do not and will not (i) violate any provision of Laurus' charter
      or organizational documents, (ii) conflict with, or constitute a
      default (or an event which with notice or lapse of time or both would
      become a default) under, or give to others any rights of termination,
      amendment, acceleration or cancellation of, any agreement, mortgage,
      deed of trust, indenture, note, bond, license, lease agreement,
      instrument or obligation to which Laurus is a party or by which
      Laurus' respective properties or assets are bound, or (iii) result
      in a violation of any federal, state, local or foreign statute, rule,
      regulation, order, judgment or decree (including federal and state
      securities laws and regulations) applicable to Laurus or by which any
      property or asset of Laurus is bound or affected, except, in all cases,
      other than violations pursuant to clauses (i) or (iii) (with respect
      to federal and state securities laws) above, except, for such conflicts,
      defaults, terminations, amendments, acceleration, cancellations and
      violations as would not, individually or in the aggregate, materially
      and adversely affect Laurus' ability to perform its obligations under
      this Agreement.

15.13 Laurus understands that the securities issued pursuant to this Agreement
      and the Ancillary Agreements must be held  as required by applicable
      law unless such securities are registered under the Securities Act or
      an exemption from registration is available.  Laurus acknowledges that
      it is familiar with Rule 144 of the rules and regulations of the
      Commission, as amended, promulgated pursuant to the Securities Act
      ("Rule 144"), and that Laurus has been advised that Rule 144 permits
      resales only under certain circumstances.  Laurus understands that to
      the extent that Rule 144 is not available, Laurus will be unable to
      sell any securities without either registration under the Securities
      Act or the existence of another exemption from such registration
      requirement.

                                       38
<PAGE>

15.14 Laurus understands that the securities are being offered and sold in
      reliance on a transactional exemption from the registration requirements
      of federal and state securities laws and the Company is relying upon
      the truth and accuracy of the representations, warranties, agreements,
      acknowledgments and understandings of Laurus set forth herein in order
      to determine the applicability of such exemptions and the suitability
      of Laurus to acquire the securities.

15.15 Laurus has not employed any broker or finder or incurred any liability
      for any brokerage or investment banking fees, commissions, finders'
      structuring fees, financial advisory fees or other similar fees in
      connection with this Agreement or the Ancillary Agreements.

15.16 Laurus is not purchasing the securities as a result of any advertisement,
      article, notice or other communication regarding the securities published
      in any newspaper, magazine or similar media or broadcast over television
      or radio or presented at any seminar or any other general solicitation or
      general advertisement.

15.17 Laurus will comply with Regulation M under the Exchange Act.

                                  Article 16

POWER OF ATTORNEY.

        The Company hereby appoints Laurus as the Company's attorney, with
        power to:  (i) endorse the Company's name on any checks, notes,
        acceptances, money orders, drafts or other forms of payment or
        security that come into Laurus' possession consistent with this
        Agreement and the Ancillary Agreements; (ii) sign the Company's
        name on any invoice or bill of lading relating to any Accounts,
        drafts against Account Debtors, schedules and assignments of
        Accounts, notices of assignment, financing statements and other
        public records relating to any Accounts, verifications of Account
        and notices to or from Account Debtors; (iii) verify the validity,
        amount or any other matter relating to any Account by mail,
        telephone, telegraph or otherwise with Account Debtors, however
        Laurus will notify the Company in writing prior to contacting any
        of its customers or clients and will use its best efforts to
        maintain the Company's goodwill with its customers and clients;
        (iv) do all things reasonably necessary to carry out this
        Agreement, any Ancillary Agreement and all related documents;
        and (v) on or after the occurrence and during the continuation
        of an Event of Default, notify the post office authorities to
        change the address for delivery of the Company's mail to an
        address designated by Laurus, and to receive and open mail addressed
        to the Company however any mail not relating to the Accounts will
        immediately be forwarded to the Company.    Neither Laurus, nor
        the attorney will be liable for any acts or omissions or for any
        error of judgment or mistake of fact or law, except for gross
        negligence or willful misconduct.  This power, being coupled with
        an interest, is irrevocable until the Obligations have been fully
        satisfied or the Agreement terminates, whichever is later.

                                       39
<PAGE>

                                  Article 17

TERM OF AGREEMENT.

        Laurus' agreement to make Loans and extend financial accommodations
        under and in accordance with the terms of this Agreement or any
        Ancillary Agreement shall continue in full force and effect until
        the expiration of the Term.  At Laurus' election following the
        occurrence of an Event of Default, Laurus may terminate this Agreement
        upon written notice to the Company.  The termination of the Agreement
        shall not affect any of Laurus' rights hereunder or any Ancillary
        Agreement and the provisions hereof and thereof shall continue to be
        fully operative until all transactions entered into, rights or
        interests created and the Obligations have been irrevocably disposed
        of, concluded or liquidated.  Notwithstanding the foregoing, Laurus
        shall release its security interests at any time after thirty (30) days
        notice upon irrevocable payment to it of all Obligations if  the
        Company shall have (i) provided Laurus with an executed release of
        any and all claims which the Company may have or thereafter have
        under this Agreement and all Ancillary Agreements and (ii) paid to
        Laurus an early payment fee in an amount equal to (1) five percent
        (5.0%) of the Total Investment Amount if such payment occurs prior
        to the first anniversary of the Closing Date, (2) four percent
        (4.0%) of the Total Investment Amount if such payment occurs on or
        after the first anniversary of the Closing Date and prior to the
        second anniversary of the Closing Date and (3) three percent
        (3.0%) of the Total Investment Amount if such termination occurs
        thereafter during the Term; such fee being intended to compensate
        Laurus for its costs and expenses incurred in initially approving
        this Agreement or extending same. Such early payment fee shall be
        due and payable jointly and severally by the Company to Laurus
        upon termination by acceleration of this Agreement by Laurus due
        to the occurrence and continuance of an Event of Default.

                                  Article 18

TERMINATION OF LIEN.

        The Liens and rights granted to Laurus hereunder and any Ancillary
        Agreements and the financing statements filed in connection herewith
        or therewith shall continue in full force and effect, notwithstanding
        the termination of this Agreement or the fact that the Company's
        account may from time to time be temporarily in a zero or credit
        position, until all of the Obligations have been indefeasibly paid
        or performed in full after the termination of this Agreement.
        Laurus shall not be required to send termination statements to the
        Company, or to file them with any filing office, unless and until
        this Agreement and the Ancillary Agreements shall have been
        terminated in accordance with their terms and all Obligations
        indefeasibly paid in full in immediately available funds.

                                       40
<PAGE>

                                  Article 19
EVENTS OF DEFAULT.

        The occurrence of any of the following shall constitute an
        "Event of Default":

        (a) failure to make payment of any of the Obligations when required
            hereunder, and, in any such case, such failure shall continue for
            a period of three (3) days following the date upon which any
            such payment was due;

        (b) failure by the Company or any of its Subsidiaries to pay any taxes
            when due unless such taxes are being contested in good faith by
            appropriate proceedings and with respect to which adequate reserves
            have been provided on the Company's and/or such Subsidiary's books;

        (c) failure to perform under, and/or committing any breach of, in any
            material respect, this Agreement or any covenant contained
            herein, which failure or breach shall continue without remedy
            for a period of fifteen (15) days after the occurrence thereof;

        (d) any representation, warranty or statement made by the Company or
            any of its Subsidiaries hereunder, in any Ancillary Agreement, any
            certificate, statement or document delivered pursuant to the
            terms hereof, or in connection with the transactions contemplated
            by this Agreement should prove to be false or misleading in any
            material respect on the date as of which made or deemed made;

        (e) the occurrence of any default (or similar term) in the observance
            or performance of any other agreement or condition relating to
            any indebtedness or contingent obligation of the Company or any
            of its Subsidiaries beyond the period of grace (if any), the
            effect of which default is to cause, or permit the holder or
            holders of such indebtedness or beneficiary or beneficiaries of
            such contingent obligation to cause, such indebtedness to become
            due prior to its stated maturity or such contingent obligation to
            become payable;

        (f) attachments or levies in excess of US$50,000 in the aggregate are
            made upon the Company's assets or a judgment is rendered against
            the Company's property involving a  liability of more than
            US$50,000 which shall not have been vacated, discharged, stayed
            or bonded within thirty (30) days from the entry thereof;

        (g) any change in the Company's or any of its Subsidiary's condition
            or affairs (financial or otherwise) which in Laurus' reasonable,
            good faith opinion, could reasonably be expected to have a
            Material Adverse Effect;

        (h) any Lien created hereunder or under any Ancillary Agreement for any
            reason ceases to be or is not a valid and perfected Lien having a
            first priority interest;

                                       41
<PAGE>

        (i) the Company or any of its Subsidiaries shall (i) apply for, consent
            to or suffer to exist the appointment of, or the taking of
            possession by, a receiver, custodian, trustee or liquidator of
            itself or of all or a substantial part of its property, (ii) make
            a general assignment for the benefit of creditors, (iii) commence
            a voluntary case under the Canadian federal (including without
            limitation, the Bankruptcy and Insolvency Act (Canada) or the
            Company Creditors Arrangement Act) bankruptcy laws (as now or
            hereafter in effect), (iv) be adjudicated a bankrupt or insolvent,
            (v) file a petition seeking to take advantage of any other law
            providing for the relief of debtors, (vi) acquiesce to without
            challenge within ten (10) days of the filing thereof, or failure
            to have dismissed within thirty (30) days, any petition filed
            against it in any involuntary case under such bankruptcy laws,
            or (vii) take any action for the purpose of effecting any of the
            foregoing;

        (j) the Company or any of its Subsidiaries shall admit in writing its
            inability, or be generally unable, to pay its debts as they become
            due or cease operations of its present business;

        (k) the Company or any of its Subsidiaries directly or indirectly
            sells, assigns, transfers, conveys, or suffers or permits to occur
            any sale, assignment, transfer or conveyance of any assets of the
            Company or any interest therein, except as permitted herein;

        (l) any "Person" or "group" (as such terms are defined in Sections
            13(d) and 14(d) of the Exchange Act, as in effect on the date
            hereof), other than the Holder, is or becomes the "beneficial
            owner" (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange
            Act), directly or indirectly, of 35% or more on a fully diluted
            basis of the then outstanding voting equity interest of  the
            Company (other than a "Person" or "group" that beneficially
            owns 35% or more of such outstanding voting equity interests of
            the Company on the date hereof)  (ii) the Board of Directors of
            the Company shall cease to consist of a majority of the Board of
            Directors of  the Company on the date hereof (or directors
            appointed by a majority of the board of directors in effect
            immediately prior to such appointment) or (iii)  the Company
            or any of its Subsidiaries merges or consolidates with, or sells
            all or substantially all of its assets to, any other person or
            entity;

        (m) the indictment of the Company or any of its Subsidiaries or any
            executive officer of the Company or any of its Subsidiaries
            under any felony criminal statute, or commencement of criminal
            or civil proceeding against the Company or any of its Subsidiaries
            or any executive officer of the Company or any of its Subsidiaries
            pursuant to which statute or proceeding penalties or remedies
            sought or available include forfeiture of any of the property of
            the Company or any of its Subsidiaries other than routine
            litigation in the ordinary course of business;

        (n) an Event of Default (or similar term) shall occur under and as
            defined in any Note or in any other Ancillary Agreement;

                                       42
<PAGE>

        (o) the Company or any of its Subsidiaries shall breach any term or
            provision of any Ancillary Agreement to which it is a party, in
            any material respect which breach is not cured within any
            applicable cure or grace period provided in respect thereof
            (if any);

        (p) any proceeding shall be brought to challenge the validity,
            binding effect of any Ancillary Agreement or any Ancillary
            Agreement ceases to be a valid, binding and enforceable
            obligation of the Company or any of its Subsidiaries (to the
            extent such Persons are a party thereto);

        (q) an SEC stop trade order or Principal Market trading suspension
            of the Common Stock shall be in effect for five (5) consecutive
            days or five (5) days during a period of ten (10) consecutive
            days, excluding in all cases a suspension of all trading on a
            Principal Market, provided that  the Company shall not have
            been able to cure such trading suspension within thirty (30)
            days of the notice thereof or list the Common Stock on another
            Principal Market within sixty (60) days of such notice;

        (r) The Company's failure to deliver Common Stock to Laurus pursuant
            to and in the form required by the Notes and this Agreement, if
            such failure to deliver Common Stock shall not be cured within
            two (2) Business Days or the Company is required to issue a
            replacement Note to Laurus and the Company shall fail to deliver
            such replacement Note within seven (7) Business Days.

                                  Article 20

REMEDIES.

        (a) Following the occurrence of an Event of Default, Laurus shall have
            the right to demand repayment in full of all Obligations, whether
            or not otherwise due.  Until all Obligations have been fully and
            indefeasibly satisfied, Laurus shall retain its Lien in all
            Collateral.  To the extent applicable, both before and after the
            occurrence of an Event of Default, Laurus shall have, in addition
            to all other rights provided herein and in each Ancillary
            Agreement, the rights and remedies of a secured party under the
            UCC, the PPSA and under other applicable law, all other legal
            and equitable rights to which Laurus may be entitled, including
            the right to take immediate possession of, collect, demand, sue
            on, enforce, recover and receive the Collateral, give valid and
            binding receipts and discharges therefor and in respect thereof,
            to require  the Company to assemble the Collateral, at Companies'
            joint and several expense, and to make it available to Laurus at
            a place designated by Laurus which is reasonably convenient to
            both parties and to enter any of the premises of the Company or
            wherever the Collateral shall be located, with or without force
            or process of law, and to keep and store the same on said
            premises until sold (and if said premises be the property of
            the Company, the Company agrees not to charge Laurus for
            storage thereof).  Further, Laurus may, at any time or times
            after the occurrence of an Event of Default, sell and deliver
            all Collateral held by or for Laurus at public or private sale
            for cash, upon credit or otherwise, at such prices and upon
            such terms as Laurus, in Laurus' sole discretion, deems advisable
            or Laurus may otherwise recover upon the Collateral in any

                                       43
<PAGE>

            commercially reasonable manner as Laurus, in its sole discretion,
            deems advisable.  The requirement of reasonable notice shall be
            met if such notice is mailed postage prepaid to the Company at
            Company's address as shown in Laurus' records, at least ten (10)
            days before the time of the event of which notice is being given.
            Laurus may be the purchaser at any sale, if it is public. The
            proceeds of sale shall be applied first to all costs and expenses
            of sale, including operating the Company's accounts, preparing
            and enforcing this Agreement, taking and maintaining custody of,
            preserving, repairing, possessing, preparing for disposition and
            disposing of Collateral and enforcing or collecting indebtedness
            and all such costs, charges and expenses, including legal fees,
            and second to the payment (in whatever order Laurus elects) of all
            Obligations.  After the indefeasible payment and satisfaction in
            full of all of the Obligations, and after the payment by Laurus of
            any other amount required by any provision of law, including
            Section 9 608(a)(1) of the UCC and the PPSA (but only after Laurus
            has received what Laurus considers reasonable proof of a
            subordinate party's security interest), the surplus, if any,
            shall be paid to the Company (for the benefit of the applicable
            Companies) or its representatives or to whosoever may be lawfully
            entitled to receive the same, or as a court of competent
            jurisdiction may direct.  The Company shall remain liable to
            Laurus for any deficiency.  In addition, the Company shall pay
            Laurus a liquidation fee ("Liquidation Fee") in the amount of five
            percent (5%) of the actual amount collected in respect of each
            Account outstanding at any time during a Liquidation Period".
            For purposes hereof, "Liquidation Period" means a period:
            (i) beginning on the earliest date of (x) an event referred to
            in Section Article 19(i) or (j), or (y) the cessation of the
            Company's business; and (ii) ending on the date on which Laurus
            has actually received all Obligations due and owing it under this
            Agreement and the Ancillary Agreements.  The Liquidation Fee
            shall be paid on the date on which Laurus collects the applicable
            Account by deduction from the proceeds thereof.   The Company and
            Laurus acknowledge that the actual damages that would be incurred
            by Laurus after the occurrence of an Event of Default would be
            difficult to quantify and that the Company and Laurus have agreed
            that the fees and obligations set forth in this Section and in
            this Agreement would constitute fair and appropriate liquidated
            damages in the event of any such termination.

        (b) Upon the occurrence of and during the continuance of any Event of
            Default, Laurus may appoint or reappoint by instrument in writing,
            any person or persons, whether an officer or officers or an
            employee or employees of Laurus or not, to be an interim receiver,
            receiver or receivers (hereinafter called a "Receiver", which term
            when used herein shall include a receiver and manager) of any
            Collateral of the Company (including any interest, income or
            profits therefrom) and may remove any Receiver so appointed and
            appoint another in his/her/its stead.  Any such Receiver shall,
            so far as concerns responsibility for his/her/its acts, be deemed
            the agent of the Company and not Laurus, and Laurus shall not be
            in any way responsible for any misconduct, negligence or
            non-feasance on the part of any such Receiver or his/her/its
            servants, agents or employees.  Subject to the provisions of the
            instrument appointing him/her/it, any such Receiver shall have
            power to take possession of Collateral, to preserve Collateral
            or its value, to carry on or concur in carrying on all or any
            part of the business of the Company and to sell, lease, license
            or otherwise dispose of or concur in selling, leasing, licensing
            or otherwise disposing of Collateral.  To facilitate the foregoing

                                       44
<PAGE>
            powers, any such Receiver may, to the exclusion of all others,
            including the Company, enter upon, use and occupy all premises
            owned or occupied by the Company wherein Collateral may be
            situate, maintain Collateral upon such premises, borrow money
            on a secured or unsecured basis and use Collateral directly in
            carrying on the Company's business or as security for loans or
            advances to enable the Receiver to carry on the Company's
            business or otherwise, as such Receiver shall, in its discretion,
            determine.  Except as may be otherwise directed by Laurus, all
            money received from time to time by such Receiver in carrying out
            his/her/its appointment shall be received in trust for and be
            paid over to Laurus.  Every such Receiver may, in the discretion
            of Laurus, be vested with all or any of the rights and powers of
            Laurus.

                                  Article 21

WAIVERS.

        To the full extent permitted by applicable law, the Company hereby
        waives (a) presentment, demand and protest, and notice of presentment,
        dishonor, intent to accelerate, acceleration, protest, default,
        nonpayment, maturity, release, compromise, settlement, extension or
        renewal of any or all of this Agreement and the Ancillary Agreements
        or any other notes, commercial paper, Accounts, contracts, Documents,
        Instruments, Chattel Paper and guaranties at any time held by Laurus
        on which the Company may in any way be liable, and hereby ratifies
        and confirms whatever Laurus may do in this regard; (b) all rights
        to notice and a hearing prior to Laurus' taking possession or control
        of, or to Laurus' replevy, attachment or levy upon, any Collateral or
        any bond or security that might be required by any court prior to
        allowing Laurus to exercise any of its remedies; and (c) the benefit
        of all valuation, appraisal and exemption laws.   the Company
        acknowledges that it has been advised by counsel of its choices and
        decisions with respect to this Agreement, the Ancillary Agreements
        and the transactions evidenced hereby and thereby.

                                  Article 22

EXPENSES.

        The Company shall pay Laurus' out-of-pocket costs and expenses,
        including reasonable fees and disbursements of in-house or outside
        counsel and appraisers, in connection with the preparation, execution
        and delivery of this Agreement and the Ancillary Agreements, and in
        connection with the prosecution or defense of any action, contest,
        dispute, suit or proceeding concerning any matter in any way arising
        out of, related to or connected with this Agreement or any Ancillary
        Agreement.  The Company shall also pay all of Laurus' reasonable
        fees, charges, out-of-pocket costs and expenses, including fees and
        disbursements of counsel and appraisers, in connection with (a) the
        preparation, execution and delivery of any waiver, any amendment
        thereto or consent proposed or executed in connection with the
        transactions contemplated by this Agreement or the Ancillary
        Agreements, (b) Laurus' obtaining performance of the Obligations
        under this Agreement and any Ancillary Agreements, including, but
        not limited to, the enforcement or defense of Laurus' security
        interests, assignments of rights and Liens hereunder as valid
        perfected security interests, (c) any attempt to inspect, verify,
        protect, collect, sell, liquidate or otherwise dispose of any
        Collateral, (d) any appraisals or re appraisals of any property
        (real or personal) pledged to Laurus by the Company or any of
        its Subsidiaries as Collateral for, or any other Person as security
        for, the Obligations hereunder and (e) any consultations in
        connection with any of the foregoing.  The Company shall also pay
        Laurus' customary bank charges for all bank services (including
        wire transfers) performed or caused to be performed by Laurus for

                                       45
<PAGE>

        the Company or any of its Subsidiaries at the Company's or such
        Subsidiary's request or in connection with the Company's loan
        account with Laurus.  All such costs and expenses together with
        all filing, recording and search fees, taxes and interest payable
        by the Company to Laurus shall be payable on demand and shall be
        secured by the Collateral.  If any tax by any Governmental
        Authority is or may be imposed on or as a result of any transaction
        between the Company and/or any Subsidiary thereof, on the one hand,
        and Laurus on the other hand, which Laurus is or may be required
        to withhold or pay, the Company hereby indemnifies and holds Laurus
        harmless in respect of such taxes, and the Company will repay to
        Laurus the amount of any such taxes which shall be charged to the
        Company' account upon written notice to the Company of the amount
        and nature of the taxes; and until the Company shall furnish Laurus
        with indemnity therefor (or supply Laurus with evidence satisfactory
        to it that due provision for the payment thereof has been made),
        Laurus may hold without interest any balance standing to  the
        Company's credit and Laurus shall retain its Liens in any and all
        Collateral.

                                  Article 23
ASSIGNMENT BY LAURUS.

        Laurus may  assign any or all of the Obligations together with any
        or all of the security therefor to any Person.  Any such assignee shall
        succeed to all of Laurus' rights with respect thereto.  Laurus shall
        not be permitted to effect any such assignment to a competitor of the
        Company unless an Event of Default has occurred and is continuing.
        Upon such assignment, Laurus shall be released from all
        responsibility for the Collateral to the extent same is assigned to
        any transferee.  Laurus may from time to time sell or otherwise grant
        participations in any of the Obligations and the holder of any such
        participation shall, subject to the terms of any agreement between
        Laurus and such holder, be entitled to the same benefits as Laurus
        with respect to any security for the Obligations in which such holder
        is a participant.   The Company agrees that each such holder may
        exercise any and all rights of banker's lien, set-off and counterclaim
        with respect to its participation in the Obligations as fully as
        though the Company were directly indebted to such holder in the amount
        of such participation.

                                  Article 24

NO WAIVER; CUMULATIVE REMEDIES.

        Failure by Laurus to exercise any right, remedy or option under this
        Agreement, any Ancillary Agreement or any supplement hereto or thereto
        or any other agreement between or among the Company and Laurus or delay
        by Laurus in exercising the same, will not operate as a waiver; no
        waiver by Laurus or the Company will be effective unless it is in
        writing and then only to the extent specifically stated.  Laurus'
        rights and remedies under this Agreement and the Ancillary Agreements
        will be cumulative and not exclusive of any other right or remedy
        which Laurus may have.

                                       46
<PAGE>

                                  Article 25

APPLICATION OF PAYMENTS.

        The Company irrevocably waive the right to direct the application of
        any and all payments at any time or times hereafter received by Laurus
        from or on the Company's behalf and  the Company hereby irrevocably
        agrees that Laurus shall have the continuing exclusive right to apply
        and reapply any and all payments received at any time or times
        hereafter against the Obligations hereunder in such manner as Laurus
        may deem advisable notwithstanding any entry by Laurus upon any of
        Laurus' books and records.

                                  Article 26

INDEMNITY.

        The Company indemnifies and holds Laurus, and its respective
        affiliates, employees, attorneys and agents (each, an "Indemnified
        Person"), harmless from and against any and all suits, actions,
        proceedings, claims, damages, losses, liabilities and expenses of
        any kind or nature whatsoever (including reasonable attorneys' fees
        and disbursements and other costs of investigation or defense,
        including those incurred upon any appeal) which may be instituted or
        asserted against or incurred by any such Indemnified Person as the
        result of credit having been extended, suspended or terminated under
        this Agreement or any of the Ancillary Agreements or with respect to
        the execution, delivery, enforcement, performance and administration
        of, or in any other way arising out of or relating to, this Agreement,
        the Ancillary Agreements or any other documents or transactions
        contemplated by or referred to herein or therein and any actions or
        failures to act with respect to any of the foregoing, except to the
        extent that any such indemnified liability is finally determined by
        a court of competent jurisdiction to have resulted solely from such
        Indemnified Person's gross negligence or willful misconduct. NO
        INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR LIABLE TO THE COMPANY OR TO
        ANY OTHER PARTY OR TO ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY
        BENEFICIARY OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH
        SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL
        DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF CREDIT HAVING BEEN
        EXTENDED, SUSPENDED OR TERMINATED UNDER THIS AGREEMENT OR ANY
        ANCILLARY AGREEMENT OR AS A RESULT OF ANY OTHER TRANSACTION
        CONTEMPLATED HEREUNDER OR THEREUNDER.

                                       47
<PAGE>

                                  Article 27

CURRENCY.

        If for the purpose of obtaining judgment in any court it is necessary
        to convert an amount due hereunder in the currency in which it is due
        (the "Original Currency") into another currency (the "Second
        Currency"), the rate of exchange applied shall be that at which,
        in accordance with normal banking procedures, Laurus could purchase,
        in the New York foreign exchange market, the Original Currency with
        the Second Currency on the date two (2) Business Days preceding that
        on which judgment is given.   The Company agrees that its obligation
        in respect of any Original Currency due from it to Laurus hereunder
        shall, notwithstanding any judgment or payment in such other currency,
        be discharged only to the extent that, on the Business Day following
        the date Laurus receives payment of any sum so adjudged to be due
        hereunder in the Second Currency.  Laurus may, in accordance with
        normal banking procedures, purchase, in the New York City foreign
        exchange market, the Original Currency with the amount of the
        Second Currency so paid; and if the amount of the Original Currency
        so purchased or could have been so purchased is less than the
        amount originally due in the Original Currency.  The Company
        agrees as a separate obligation and notwithstanding any such payment
        or judgment to indemnify Laurus against such loss.  The term "rate
        of exchange" in this paragraph means the spot rate at which Laurus,
        in accordance with normal practices, is able on the relevant date to
        purchase the Original Currency with the Second Currency and includes
        any premium and costs of exchange payable in connection with such
        purchase.

                                  Article 28

REVIVAL.

        The Company further agree that to the extent the Company makes a
        payment or payments to Laurus, which payment or payments or any part
        thereof are subsequently invalidated, declared to be fraudulent or
        preferential, set aside and/or required to be repaid to a trustee,
        receiver or any other party under any bankruptcy act, state or federal
        law, common law or equitable cause, then, to the extent of such
        payment or repayment, the obligation or part thereof intended to be
        satisfied shall be revived and continued in full force and effect as
        if said payment had not been made.

                                  Article 29

NOTICES.

        Any notice or request hereunder may be given to the Company,  the
        Company or Laurus at the respective addresses set forth below or as
        may hereafter be specified in a notice designated as a change of
        address under this Section.  Any notice or request hereunder shall
        be given by registered or certified mail, return receipt requested,
        hand delivery, overnight mail or telecopy (confirmed by mail).
        Notices and requests shall be, in the case of those by hand delivery,
        deemed to have been given when delivered to any officer of the party
        to whom it is addressed, in the case of those by mail or overnight
        mail, deemed to have been given three (3) Business Days after the
        date when deposited in the mail or with the overnight mail carrier,
        and, in the case of a telecopy, when confirmed.

                                       48
<PAGE>

        Notices shall be provided as follows:

        (a) If to Laurus:               Laurus Master Fund, Ltd.
                                        c/o Laurus Capital Management, LLC
                                        825 Third Avenue, 14th Fl.
                                        New York, New York 10022

                                        Attention: John E. Tucker, Esq.

                                        Telephone: (212) 541-4434
                                        Telecopier:(212) 541-5800

        With a copy to:

        (b)                             Laurus Master Fund, Ltd.c/o
                                        M&C Corporate Services Limited
                                        P.O.  Box 309 GT
                                        Ugland House
                                        George Town
                                        South Church Street
                                        Grand Cayman, Cayman Islands

                                        Facsimile:  345-949-8080

        (c) If to the Company:          On The Go HealthCare, Inc.
                                        85 Corstate Ave Unit #1
                                        Concord, Ontario, L4K 4Y2

                                        Attention: Stuart Turk

                                        Telephone: (905) 760-2987
                                        Facsimile: (905) 660-5738

        With a copy to:                 Trombly Business Law
                                        80 Dorcar Road
                                        Newton, MA  02461
                                        Attention: Amy Trombly
                                        Telephone: (617) 243-0060
                                        Facsimile: (617) 243-0066

        and such other address as may be designated in writing hereafter
        in accordance with this Section by such Person.

                                  Article 30

GOVERNING LAW, JURISDICTION AND WAIVER OF JURY TRIAL.

        (a) THIS AGREEMENT AND THE ANCILLARY AGREEMENTS SHALL BE GOVERNED BY
            AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
            OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH
            STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

                                       49
<PAGE>

        (b) THE COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL
            COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL
            HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR
            DISPUTES BETWEEN THE COMPANY, ON THE ONE HAND, AND LAURUS, ON THE
            OTHER HAND, PERTAINING TO THIS AGREEMENT OR ANY OF THE ANCILLARY
            AGREEMENTS OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS
            AGREEMENT OR ANY OF THE ANCILLARY AGREEMENTS; PROVIDED, THAT LAURUS
            AND THE COMPANY ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY
            HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF
            NEW YORK, STATE OF NEW YORK; AND FURTHER PROVIDED, THAT NOTHING
            IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE LAURUS
            FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER
            JURISDICTION TO COLLECT THE OBLIGATIONS, TO REALIZE ON THE
            COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO
            ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF LAURUS.
            THE COMPANY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
            JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT,
            AND  THE COMPANY HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE
            BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR
            FORUM NON CONVENIENS.   THE COMPANY HEREBY WAIVES PERSONAL
            SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN
            ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS,
            COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
            MAIL ADDRESSED TO  THE COMPANY AT THE ADDRESS SET FORTH HEREIN
            AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE
            EARLIER OF COMPANY AGENT'S ACTUAL RECEIPT THEREOF OR THREE (3)
            DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID.

        (c) THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE
            APPLYING SUCH APPLICABLE LAWS.  THEREFORE, TO ACHIEVE THE BEST
            COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF
            ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHTS TO TRIAL BY
            JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY
            DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN
            LAURUS, AND/OR THE COMPANY ARISING OUT OF, CONNECTED WITH,
            RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN
            THEM IN CONNECTION WITH THIS AGREEMENT, ANY ANCILLARY AGREEMENT
            OR THE TRANSACTIONS RELATED HERETO OR THERETO.

                                  Article 31

JUDGMENT CURRENCY.

        (a) If for the purpose of obtaining or enforcing judgment against one
            or more of the  Companies in any court in any jurisdiction it
            becomes necessary to convert into any other currency (such other
            currency being hereinafter in this Section referred to as the
            "Judgment Currency") an amount due in US dollars under this
            Security Agreement, the conversion shall be made at the Exchange
            Rate prevailing on the business day immediately preceding:

                (i) the date actual payment of the amount due, in the case
                    of any proceeding in the courts of New York or in the
                    courts of any other jurisdiction that will give effect
                    to such conversion being made on such date: or

                (ii) the date on which the foreign court determines, in the
                     case of any proceeding in the courts of any other
                     jurisdiction (the date as of which such conversion
                     is made pursuant to this Article being hereinafter
                     referred to as the "Judgment Conversion Date")

                                       50
<PAGE>

        (b) If in the case of any proceeding in the court of any jurisdiction
            referred to in (a)(ii) above, there is a change in the Exchange
            Rate prevailing between the Judgment Conversion Date and the date
            of actual payment of the amount due, the applicable party (being
            in the case of one or more Companies, the Company on a joint and
            several basis) shall pay such adjusted amount as may be necessary
            to ensure that the amount paid in the Judgment Currency, when
            converted at the Exchange Rate prevailing on the date of payment,
            will produce the amount of US dollars which could have been
            purchased with the amount of Judgment Currency stipulated in the
            judgment or judicial order at the Exchange Rate prevailing on the
            Judgment Conversion Date.

        (c) Any amount jointly and severally due from the Company under this
            provision shall be due as a separate debt and shall not be affected
            by judgment being obtained for any other amounts due under or
            in respect of this Security Agreement.

                                  Article 32

LIMITATION OF LIABILITY.

        The Company acknowledges and understands that in order to assure
        repayment of the Obligations hereunder Laurus may be required to
        exercise any and all of Laurus' rights and remedies hereunder and
        agrees that, except as limited by applicable law, neither Laurus
        nor any of Laurus' agents shall be liable for acts taken or
        omissions made in connection herewith or therewith except for
        actual bad faith or wilful misconduct.

                                  Article 33

ENTIRE UNDERSTANDING; MAXIMUM INTEREST.

        This Agreement and the Ancillary Agreements contain the entire
        understanding among  the Company and Laurus as to the subject
        matter hereof and thereof and any promises, representations,
        warranties or guarantees not herein contained shall have no force
        and effect unless in writing, signed by  the Company's and Laurus'
        respective officers.  Neither this Agreement, the Ancillary
        Agreements, nor any portion or provisions thereof may be changed,
        modified, amended, waived, supplemented, discharged, cancelled or
        terminated orally or by any course of dealing, or in any manner
        other than by an agreement in writing, signed by the party to be
        charged.  Nothing contained in this Agreement, any Ancillary
        Agreement or in any document referred to herein or delivered in
        connection herewith shall be deemed to establish or require the
        payment of a rate of interest or other charges in excess of the
        maximum rate permitted by applicable law.  In the event that the
        rate of interest or dividends required to be paid or other charges
        hereunder exceed the maximum rate permitted by such law, any
        payments in excess of such maximum shall be credited against
        amounts owed by the Company to Laurus and thus refunded to the
        Company.

                                       51
<PAGE>

                                  Article 34

SEVERABILITY.

        Wherever possible each provision of this Agreement or the Ancillary
        Agreements shall be interpreted in such manner as to be effective
        and valid under applicable law, but if any provision of this
        Agreement or the Ancillary Agreements shall be prohibited by or
        invalid under applicable law such provision shall be ineffective
        to the extent of such prohibition or invalidity, without
        invalidating the remainder of such provision or the remaining
        provisions thereof.

                                  Article 35

SURVIVAL.

        The representations, warranties, covenants and agreements made
        herein shall survive any investigation made by Laurus and the closing
        of the transactions contemplated hereby to the extent provided therein.
        All statements as to factual matters contained in any certificate or
        other instrument delivered by or on behalf of the Company pursuant
        hereto in connection with the transactions contemplated hereby shall
        be deemed to be representations and warranties by the Company
        hereunder solely as of the date of such certificate or instrument.
        All indemnities set forth herein shall survive the execution,
        delivery and termination of this Agreement and the Ancillary
        Agreements and the making and repaying of the Obligations.

                                  Article 36

CAPTIONS.

        All captions are and shall be without substantive meaning or content
        of any kind whatsoever.

                                  Article 37

COUNTERPARTS; TELECOPIER SIGNATURES.

        This Agreement may be executed in one or more counterparts, each of
        which shall constitute an original and all of which taken together
        shall constitute one and the same agreement.  Any signature delivered
        by a party via telecopier transmission shall be deemed to be any
        original signature hereto.

                                  Article 38

CONSTRUCTION.

        The parties acknowledge that each party and its counsel have reviewed
        this Agreement and that the normal rule of construction to the effect
        that any ambiguities are to be resolved against the drafting party
        shall not be employed in the interpretation of this Agreement or any
        amendments, schedules or exhibits thereto.

                                       52
<PAGE>

                                  Article 39

PUBLICITY.

        The Company hereby authorizes Laurus to make appropriate announcements
        of the financial arrangement entered into by and among  the Company and
        Laurus, including, without limitation, announcements which are commonly
        known as tombstones, in such publications and to such selected parties
        as Laurus shall in its sole and absolute discretion deem appropriate,
        or as required by applicable law.

                                  Article 40

JOINDER.

        It is understood and agreed that any Person that desires to become a
        Company hereunder, or is required to execute a counterpart of this
        Agreement after the date hereof pursuant to the requirements of this
        Agreement or any Ancillary Agreement, shall become a Company hereunder
        by (a) executing a Joinder Agreement in form and substance satisfactory
        to Laurus, (b) delivering supplements to such exhibits and annexes to
        this Agreement and the Ancillary Agreements as Laurus shall reasonably
        request and (c) taking all actions as specified in this Agreement as
        would have been taken by the Company had it been an original party to
        this Agreement, in each case with all documents required above to be
        delivered to Laurus and with all documents and actions required above
        to be taken to the reasonable satisfaction of Laurus.

                                  Article 41

LEGENDS.

        The Securities shall bear legends as follows;

        (a) The Notes shall bear substantially the following legend:

        "THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE
        HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
        OR ANY APPLICABLE, STATE SECURITIES LAWS.  THIS NOTE AND THE COMMON
        STOCK ISSUABLE UPON CONVERSION OF THIS NOTE MAY NOT BE SOLD, OFFERED
        FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
        REGISTRATION STATEMENT AS TO THIS NOTE OR SUCH SHARES UNDER SAID ACT
        AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
        REASONABLY SATISFACTORY TO COMPANY THAT SUCH REGISTRATION IS NOT
        REQUIRED."

        (b) Any shares of Common Stock issued pursuant to conversion of the
            Notes or exercise of the Warrants, shall bear a legend which shall
            be in substantially the following form until such shares are
            covered by an effective registration statement filed with the SEC:

        "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
        UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE, STATE
        SECURITIES LAWS.  THESE SHARES MAY NOT BE SOLD, OFFERED FOR SALE,
        PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
        STATEMENT UNDER SUCH SECURITIES ACT AND APPLICABLE STATE SECURITIES
        LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO COMPANY THAT
        SUCH REGISTRATION IS NOT REQUIRED."

                                       53
<PAGE>

        (c) The Warrants shall bear substantially the following legend:

        "THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS
        WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
        AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS.  THIS WARRANT
        AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT
        BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF
        AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT OR THE
        UNDERLYING SHARES OF COMMON STOCK UNDER SAID ACT AND APPLICABLE STATE
        SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
        COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."

        [Balance of page intentionally left blank; signature page follows.]

                                       54
<PAGE>

IN WITNESS WHEREOF, the parties have executed this Security Agreement as of
the date first written above.

ON THE GO HEALTHCARE, INC.

Per:/s/Stuart Turk
--------------------------
Name:Stuart Turk
Title:CEO

LAURUS MASTER FUND, LTD.

By:/s/David Grin
-------------------------
Name:David Grin
Title: Director

                                       55
<PAGE>

                                ANNEX A - DEFINITIONS

"Account Debtor" means any Person who is or may be obligated with respect to,
or on account of, an Account.

"Accountants" has the meaning given to such term in Article 11(a).

"Accounts" means all "accounts", as such term is defined in the UCC and the
PPSA, now owned or hereafter acquired by any Person, including:  (a) all
accounts receivable, other receivables, book debts and other forms of
obligations (other than forms of obligations evidenced by Chattel Paper or
Instruments) (including any such obligations that may be characterized as
an account or contract right under the UCC and the PPSA); (b) all of such
Person's rights in, to and under all purchase orders or receipts for goods
or services; (c) all of such Person's rights to any goods represented by
any of the foregoing (including unpaid sellers' rights of rescission,
replevin, reclamation and stoppage in transit and rights to returned,
reclaimed or repossessed goods); (d) all rights to payment due to such
Person for Goods or other property sold, leased, licensed, assigned or
otherwise disposed of, for a policy of insurance issued or to be issued,
for a secondary obligation incurred or to be incurred, for energy provided
or to be provided, for the use or hire of a vessel under a charter or other
contract, arising out of the use of a credit card or charge card, or for
services rendered or to be rendered by such Person or in connection with
any other transaction (whether or not yet earned by performance on the part
of such Person); and (e) all collateral security of any kind given by any
Account Debtor or any other Person with respect to any of the foregoing.

"Accounts Availability" means up to ninety percent (90%) of the net face amount
of Eligible Accounts.

"Affiliate" means, with respect to any Person, (a) any other Person (other
than a Subsidiary) which, directly or indirectly, is in control of, is
controlled by, or is under common control with such Person or (b) any other
Person who is a director or officer (i) of such Person, (ii) of any Subsidiary
of such Person or (iii) of any Person described in clause (a) above.  For the
purposes of this definition, control of a Person shall mean the power (direct
or indirect) to direct or cause the direction of the management and policies
of such Person whether by contract or otherwise.

"Ancillary Agreements" means the Notes, the Warrants, the Registration Rights
Agreements, each Security Document and all other agreements, instruments,
documents, mortgages, pledges, powers of attorney, consents, assignments,
contracts, notices, security agreements, trust agreements and guarantees
whether heretofore, concurrently, or hereafter executed by or on behalf of
the Company, any of its Subsidiaries or any other Person or delivered to
Laurus, relating to this Agreement or to the transactions contemplated by
this Agreement or otherwise relating to the relationship between or among
the Company and Laurus, as each of the same may be amended, supplemented,
restated or otherwise modified from time to time.

"Available Minimum Borrowing" has the meaning given such term in
Section 2.1(a).

"Balance Sheet Date" has the meaning given such term in Section 12.6(b).

                                       56
<PAGE>

"Books and Records" means all books, records, board minutes, contracts,
licenses, insurance policies, environmental audits, business plans, files,
computer files, computer discs and other data and software storage and media
devices, accounting books and records, financial statements (actual and pro
forma), filings with Governmental Authorities and any and all records and
instruments relating to the Collateral or otherwise necessary or helpful in
the collection thereof or the realization thereupon.

"Business Day" means a day on which Laurus is open for business and that is
not a Saturday, a Sunday or other day on which banks are required or permitted
to be closed in the State of New York or Canada.

"Canadian Pension Plan" means any plan, program or arrangement (other than
the Canada Pension Plan) that is a pension plan for the purposes of any
applicable pension benefits legislation or any tax laws of Canada or a province
thereof, whether or not registered under any such laws, which is maintained
or contributed to by, or to which there is or may be an obligation to
contribute by, the Company in respect of any Person's employment in Canada
with the Company.

"Canadian Lockbox Bank" has the meaning given such term in Article 8(a).

"Canadian Lockboxes" has the meaning given such term in Article 8(a).

"Capital Availability Amount" means Five Million Dollars lawful of the
currency United States (US$5,000,000).

"Charter" has the meaning given such term in Section 12.3(d).

"Chattel Paper" means all "chattel paper," as such term is defined in the UCC,
including electronic chattel paper, now owned or hereafter acquired by any
Person.

"Closing Date" means the date on which the Company shall first receive
proceeds of the initial Loans or the date hereof, if no Loan is made under
the facility on the date hereof.

"Code" has the meaning given such term in Section 15.9.

"Collateral" means all of the Company's property and assets or interest in
property or assets, whether real or personal, tangible or intangible, and
whether now owned or hereafter acquired, or in which it now has or at any
time in the future may acquire any right, title or interests including all
of the following property in which it now has or at any time in the future
may acquire any right, title or interest:

        (a) all Inventory;

        (b) all Equipment;

        (c) all Fixtures;

        (d) all General Intangibles;

        (e) all Accounts;

                                       57
<PAGE>

        (f) all Deposit Accounts, other bank accounts and all funds on deposit
            therein;

        (g) all Investment Property;

        (h) all Stock;

        (i) all Chattel Paper;

        (j) all Letter-of-Credit Rights;

        (k) all Instruments;

        (l) all commercial tort claims set forth on Schedule 6(a) hereto;

        (m) all Books and Records;

        (n) all Intellectual Property;

        (o) all Supporting Obligations including letters of credit and
            guarantees issued in support of Accounts, Chattel Paper, General
            Intangibles and Investment Property;

        (p) (i) all money, cash and cash equivalents and (ii) all cash held as
            cash collateral to the extent not otherwise constituting
            Collateral, all other cash or property at any time on deposit
            with or held by Laurus for the account of the Company (whether
            for safekeeping, custody, pledge, transmission or otherwise); and

        (q) all products and Proceeds of all or any of the foregoing, tort
            claims and all claims and other rights to payment including
            (i) insurance claims against third parties for loss of, damage
            to, or destruction of, the foregoing Collateral and (ii) payments
            due or to become due under leases, rentals and hires of any or
            all of the foregoing and Proceeds payable under, or unearned
            premiums with respect to policies of insurance in whatever form.

"Common Stock" means the shares of stock representing the Company's common
equity interests.

"Contract Rate" has the meaning given such term in the respective Note.

"Default" means any act or event which, with the giving of notice or passage
of time or both, would constitute an Event of Default.

"Deposit Accounts" means all "deposit accounts" as such term is defined in
the UCC, now or hereafter held in the name of any Person, including, without
limitation, the Canadian Lockboxes and the US Lockboxes.

"Disclosure Controls" has the meaning given such term in Section 12.6(d).

"Documents" means all "documents", as such term is defined in the UCC, now
owned or hereafter acquired by any Person, wherever located, including all
bills of lading, dock warrants, dock receipts, warehouse receipts, and other
documents of title, whether negotiable or non-negotiable.

                                       58
<PAGE>

"Eligible Accounts" means each Account of the Company and each Eligible
Subsidiary that  conforms to the following criteria:  (a) shipment of the
merchandise or the rendition of services has been completed; (b) no return,
rejection or repossession of the merchandise has occurred; (c) merchandise or
services shall not have been rejected or disputed by the Account Debtor and
there shall not have been asserted any offset, defense or counterclaim;
(d) continues to be in full conformity with the representations and
warranties made by the Company  to Laurus with respect thereto; (e)
Laurus is, and continues to be, satisfied with the credit standing of
the Account Debtor in relation to the amount of credit extended; (f) there
are no facts existing or threatened which are likely to result in any adverse
change in an Account Debtor's financial condition; (g) is documented by an
invoice in a form approved by Laurus and shall not be unpaid more than ninety
(90) days from invoice date; (h) not more than twenty-five percent (25%) of
the unpaid amount of invoices due from such Account Debtor remains unpaid
more than ninety (90) days from invoice date; (i) is not evidenced by
chattel paper or an instrument of any kind with respect to or in payment
of the Account unless such instrument is duly endorsed to and in possession
of Laurus or represents a check in payment of an Account; (j) the Account
Debtor is located in the United States and Canada; provided, however,
Laurus may, from time to time, in the exercise of its sole discretion and
based upon satisfaction of certain conditions to be determined at such
time by Laurus, deem certain Accounts as Eligible Accounts notwithstanding
that such Account is due from an Account Debtor located outside of the
United States or Canada; (k) Laurus has a first priority perfected Lien in
such Account and such Account is not subject to any Lien other than
Permitted Liens; (l) does not arise out of transactions with any employee,
officer, director, stockholder or Affiliate of the Company ; (m) is payable
to the Company ; (n) does not arise out of a bill and hold sale prior to
shipment and does not arise out of a sale to any Person to which the Company
is indebted; (o) is net of any returns, discounts, claims, credits and
allowances; (p) if the Account arises out of contracts between the Company ,
on the one hand, and the United States, on the other hand, any state, or
any department, agency or instrumentality of any of them, the Company
has so notified Laurus, in writing, prior to the creation of such Account,
and there has been compliance with any governmental notice or approval
requirements, including compliance with the Federal Assignment of Claims
Act; (q) is a good and valid account representing an undisputed bona fide
indebtedness incurred by the Account Debtor therein named, for a fixed sum
as set forth in the invoice relating thereto with respect to an
unconditional sale and delivery upon the stated terms of goods sold by
the Company  or work, labor and/or services rendered by the Company ;
(r) does not arise out of progress billings prior to completion of the
order; (s) the total unpaid Accounts from such Account Debtor does not
exceed twenty-five percent (25%) of all Eligible Accounts; (t) the Company's
right to payment is absolute and not contingent upon the fulfillment of any
condition whatsoever; (u) the Company  is able to bring suit and enforce its
remedies against the Account Debtor through judicial process; (v) does not
represent interest payments, late or finance charges owing to the Company ,
and (w) is otherwise satisfactory to Laurus as determined by Laurus in the
exercise of its sole discretion.  In the event the Company requests that
Laurus include within Eligible Accounts certain Accounts of one or more of
the Company's acquisition targets, Laurus shall at the time of such request
consider such inclusion, but any such inclusion shall be at the sole option
of Laurus and shall at all times be subject to the execution and delivery
to Laurus of all such documentation (including, without limitation,
guaranty and security documentation) as Laurus may require in its sole
discretion.

                                       59
<PAGE>

"Eligible Subsidiary" means each Subsidiary of  the Company set forth on
Exhibit A hereto, as the same may be updated from time to time with Laurus'
written consent.

"Equipment" means all "equipment" as such term is defined in the UCC, now
owned or hereafter acquired by any Person, wherever located, including any
and all machinery, apparatus, equipment, fittings, furniture, Fixtures,
motor vehicles and other tangible personal property (other than Inventory)
of every kind and description that may be now or hereafter used in such
Person's operations or that are owned by such Person or in which such Person
may have an interest, and all parts, accessories and accessions thereto and
substitutions and replacements therefor.

"ERISA" has the meaning given such term in Section 12.28.

"Event of Default" means the occurrence of any of the events set forth in
Article 19.

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

"Exchange Act Filings" means the Company's filings under the Exchange Act
made prior to the date of this Agreement.

"Financial Reporting Controls" has the meaning given such term in
Section 12.6(e).

"Fixtures" means all "fixtures" as such term is defined in the UCC, now owned
or hereafter acquired by any Person.

"Formula Amount" has the meaning given such term in Section 2.1(a).

"GAAP" means generally accepted accounting principles, practices and procedures
in effect from time to time in the United States of America.

"General Intangibles" means all "general intangibles" as such term is defined
in the UCC, now owned or hereafter acquired by any Person including all right,
title and interest that such Person may now or hereafter have in or under any
contract, all Payment Intangibles, customer lists, Licenses, Intellectual
Property, interests in partnerships, joint ventures and other business
associations, permits, proprietary or confidential information, inventions
(whether or not patented or patentable), technical information, procedures,
designs, knowledge, know-how, Software, data bases, data, skill, expertise,
experience, processes, models, drawings, materials, Books and Records,
Goodwill (including the Goodwill associated with any Intellectual Property),
all rights and claims in or under insurance policies (including insurance for
fire, damage, loss, and casualty, whether covering personal property, real
property, tangible rights or intangible rights, all liability, life,
key-person, and business interruption insurance, and all unearned premiums),
uncertificated securities, choses in action, deposit accounts, rights to
receive tax refunds and other payments, rights to received dividends,
distributions, cash, Instruments and other property in respect of or in
exchange for pledged Stock and Investment Property, and rights of
indemnification.

                                       60
<PAGE>

"Goods" means all "goods", as such term is defined in the UCC, now owned
or hereafter acquired by any Person, wherever located, including embedded
software to the extent included in "goods" as defined in the UCC,
manufactured homes, standing timber that is cut and removed for sale and
unborn young of animals.

"Goodwill" means all goodwill, trade secrets, proprietary or confidential
information, technical information, procedures, formulae, quality control
standards, designs, operating and training manuals, customer lists, and
distribution agreements now owned or hereafter acquired by any Person.

"Governmental Authority" means any nation or government, any state or other
political subdivision thereof, and any agency, department or other entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.

"Instruments" means all "instruments", as such term is defined in the UCC,
now owned or hereafter acquired by any Person, wherever located, including
all certificated securities and all promissory notes and other evidences of
indebtedness, other than instruments that constitute, or are a part of a
group of writings that constitute, Chattel Paper.

"Intellectual Property" means any and all patents, trademarks, service marks,
trade names, copyrights, trade secrets, Licenses, information and other
proprietary rights and processes.

"Inventory" means all "inventory", as such term is defined in the UCC, now
owned or hereafter acquired by any Person, wherever located, including all
inventory, merchandise, goods and other personal property that are held by
or on behalf of such Person for sale or lease or are furnished or are to be
furnished under a contract of service or that constitute raw materials,
work in process, finished goods, returned goods, or materials or supplies
of any kind, nature or description used or consumed or to be used or consumed
in such Person's business or in the processing, production, packaging,
promotion, delivery or shipping of the same, including all supplies and
embedded software.

"Investment Property" means all "investment property", as such term is
defined in the UCC, now owned or hereafter acquired by any Person,
wherever located.

"Letter-of-Credit Rights" means "letter-of-credit rights" as such term is
defined in the UCC, now owned or hereafter acquired by any Person, including
rights to payment or performance under a letter of credit, whether or not
such Person, as beneficiary, has demanded or is entitled to demand payment
or performance.

"License" means any rights under any written agreement now or hereafter
acquired by any Person to use any trademark, trademark registration,
copyright, copyright registration or invention for which a patent is in
existence or other license of rights or interests now held or hereafter
acquired by any Person.

                                       61
<PAGE>

"Lien" means any mortgage, security deed, deed of trust, pledge, hypothecation,
assignment, security interest, lien (whether statutory or otherwise), charge,
claim or encumbrance, or preference, priority or other security agreement or
preferential arrangement held or asserted in respect of any asset of any kind
or nature whatsoever including any conditional sale or other title retention
agreement, any lease having substantially the same economic effect as any of
the foregoing, and the filing of, or agreement to give, any financing statement
under the UCC or comparable law of any jurisdiction.

"Loans" means the Revolving Loans, the Term Loan and shall include all other
extensions of credit hereunder and under any Ancillary Agreement.

"Material Adverse Effect" means a material adverse effect on (a) the business,
assets, liabilities, condition (financial or otherwise), properties, operations
or prospects of the Company or any of its Subsidiaries (taken individually and
as a whole), (b) the Company's or any of its Subsidiary's ability to pay or
perform the Obligations in accordance with the terms hereof or any Ancillary
Agreement, (c) the value of the Collateral, the Liens on the Collateral or the
priority of any such Lien or (d) the practical realization of the benefits of
Laurus' rights and remedies under this Agreement and the Ancillary Agreements.

"Minimum Borrowing Amount" means Two Million Five Hundred Thousand Dollars
lawful currency of the United States (US$2,500,000).

"Minimum Borrowing Notes" means that certain Secured Convertible Minimum
Borrowing Note dated as of the Closing Date made by the Company in favor of
Laurus evidencing the Minimum Borrowing Amount and each other Secured
Convertible Minimum Borrowing Note made by the Company in favor of Laurus
which evidences the Minimum Borrowing Amount, as each of the same may be
amended, supplemented, restated and/or otherwise modified from time to
time.

"NASD" has the meaning given such term in Section 13.2.

"Next Unissued Serialized Note" has the meaning given such term in
Section 2.1(a).

"Note Shares" has the meaning given such term in Section 12.1.

"Notes" means the Minimum Borrowing Notes, the Revolving Note and the
Term Note made by Company in favor of Laurus in connection with the
transactions contemplated hereby, as each of the same may be amended,
supplemented, restated and/or otherwise modified from time to time.

                                       62
<PAGE>

"Obligations" means all Loans, all advances, debts, liabilities, obligations,
covenants and duties owing by  the Company and each of its Subsidiaries to
Laurus (or any corporation that directly or indirectly controls or is
controlled by or is under common control with Laurus) of every kind and
description (whether or not evidenced by any note or other instrument and
whether or not for the payment of money or the performance or non-performance
of any act), direct or indirect, absolute or contingent, due or to become due,
contractual or tortious, liquidated or unliquidated, whether existing by
operation of law or otherwise now existing or hereafter arising including any
debt, liability or obligation owing from the Company and/or each of its
Subsidiaries to others which Laurus may have obtained by assignment or
otherwise and further including all interest (including interest accruing at
the then applicable rate provided in this Agreement after the maturity of the
Loans and interest accruing at the then applicable rate provided in this
Agreement after the filing of any petition in bankruptcy, or the commencement
of any insolvency, reorganization or like proceeding, whether or not a claim
for post-filing or post-petition interest is allowed or allowable in such
proceeding), charges or any other payments  the Company and each of its
Subsidiaries is required to make by law or otherwise arising under or as a
result of this Agreement, the Ancillary Agreements or otherwise, together
with all reasonable expenses and reasonable attorneys' fees chargeable to
the Company' or any of their Subsidiaries' accounts or incurred by Laurus
in connection therewith.

"Payment Intangibles" means all "payment intangibles" as such term is defined
in the UCC, now owned or hereafter acquired by any Person, including, a
General Intangible under which the Account Debtor's principal obligation is
a monetary obligation.

"Permitted Liens" means (a) Liens of carriers, warehousemen, artisans, bailees,
mechanics and materialmen incurred in the ordinary course of business securing
sums not overdue; (b) Liens incurred in the ordinary course of business in
connection with worker's compensation, unemployment insurance or other forms
of governmental insurance or benefits, relating to employees, securing sums
(i) not overdue or (ii) being diligently contested in good faith provided
that adequate reserves with respect thereto are maintained on the books of
the Company and their Subsidiaries, as applicable, in conformity with GAAP;
(c) Liens in favor of Laurus; (d) Liens for taxes (i) not yet due or (ii)
being diligently contested in good faith by appropriate proceedings, provided
that adequate reserves with respect thereto are maintained on the books of
the Company and their Subsidiaries, as applicable, in conformity with GAAP;
and which have no effect on the priority of Liens in favor of Laurus or the
value of the assets in which Laurus has a Lien; (e) Purchase Money Liens
securing Purchase Money Indebtedness to the extent permitted in this Agreement
and (f) Liens specified on Schedule 1(A) hereto.

"Person" means any individual, sole proprietorship, partnership, limited
liability partnership, joint venture, trust, unincorporated organization,
association, corporation, limited liability company, institution, public
benefit corporation, entity or government (whether federal, state, county,
city, municipal or otherwise, including any instrumentality, division,
agency, body or department thereof), and shall include such Person's
successors and assigns.

"PPSA" means the Personal Property Security Act (Ontario), as amended from
time to time and any Act substituted therefor.

                                       63
<PAGE>

"Principal Market" means the NASD Over The Counter Bulletin Board, NASDAQ
SmallCap Market, NASDAQ National Market System, American Stock Exchange or
New York Stock Exchange (whichever of the foregoing is at the time the
principal trading exchange or market for the Common Stock).

"Proceeds" means "proceeds", as such term is defined in the UCC and, in any
event, shall include:  (a) any and all proceeds of any insurance, indemnity,
warranty or guaranty payable to the Company or any other Person from time to
time with respect to any Collateral; (b) any and all payments (in any form
whatsoever) made or due and payable to the Company from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of any Collateral by any governmental body, governmental authority,
bureau or agency (or any person acting under color of governmental authority);
(c) any claim of the Company against third parties (i) for past, present or
future infringement of any Intellectual Property or (ii) for past, present
or future infringement or dilution of any trademark or trademark license or
for injury to the goodwill associated with any trademark, trademark
registration or trademark licensed under any trademark License; (d) any
recoveries by the Company against third parties with respect to any
litigation or dispute concerning any Collateral, including claims arising
out of the loss or nonconformity of, interference with the use of,
defects in, or infringement of rights in, or damage to, Collateral; (e)
all amounts collected on, or distributed on account of, other Collateral,
including dividends, interest, distributions and Instruments with respect
to Investment Property and pledged Stock; and (f) any and all other amounts,
rights to payment or other property acquired upon the sale, lease, license,
exchange or other disposition of Collateral and all rights arising out of
Collateral.

"Purchase Money Indebtedness" means (a) any indebtedness incurred for the
payment of all or any part of the purchase price of any fixed asset,
including indebtedness under capitalized leases, (b) any indebtedness
incurred for the sole purpose of financing or refinancing all or any part
of the purchase price of any fixed asset, and (c) any renewals, extensions
or refinancings thereof (but not any increases in the principal amounts
thereof outstanding at that time).

"Purchase Money Lien" means any Lien upon any fixed assets that secures the
Purchase Money Indebtedness related thereto but only if such Lien shall at
all times be confined solely to the asset the purchase price of which was
financed or refinanced through the incurrence of the Purchase Money
Indebtedness secured by such Lien and only if such Lien secures only such
Purchase Money Indebtedness.

"Registration Rights Agreements" means that certain Minimum Borrowing Note
Registration Rights Agreement dated as of the Closing Date by and between
the Company and Laurus and each other registration rights agreement by and
between  the Company and Laurus, as each of the same may be amended,
modified and supplemented from time to time.

"Revolving Loans" has the meaning given such term in Section 2.1(a).

"Revolving Note" means that certain Secured Revolving Note dated as of the
Closing Date made by the Company in favor of Laurus in the original
principal amount of means Five Million Dollars United States currency
(US$5,000,000), as the same may be amended, supplemented, restated and/or
otherwise modified from time to time.

                                       64
<PAGE>

"SEC" means the Securities and Exchange Commission.

"SEC Reports" has the meaning given such term in Section 12.21.

"Securities" means the Notes and the Warrants and the shares of Common
Stock which may be issued pursuant to conversion of such Notes in whole
or in part or exercise of such Warrants.

"Securities Act" has the meaning given such term in Section 12.18.

"Security Documents" means all security agreements, mortgages, cash
collateral deposit letters, pledges and other agreements which are
executed by the Company or any of its Subsidiaries in favor of Laurus.

"Software" means all "software" as such term is defined in the UCC, now
owned or hereafter acquired by any Person, including all computer programs
and all supporting information provided in connection with a transaction
related to any program.

"Stock" means all certificated and uncertificated shares, options, warrants,
membership interests, general or limited partnership interests, participation
or other equivalents (regardless of how designated) of or in a corporation,
partnership, limited liability company or equivalent entity whether voting
or nonvoting, including common stock, preferred stock, or any other "equity
security" (as such term is defined in Rule 3a11-1 of the General Rules and
Regulations promulgated by the SEC under the Securities Exchange Act
of 1934).

"Subsidiary" means, with respect to any Person, (i) any other Person whose
shares of stock or other ownership interests having ordinary voting power
(other than stock or other ownership interests having such power only by
reason of the happening of a contingency) to elect a majority of the
directors or other governing body of such other Person, are owned, directly
or indirectly, by such Person or (ii) any other Person in which such Person
owns, directly or indirectly, more than 50% of the equity interests at such
time.

"Supporting Obligations" means all "supporting obligations" as such term
is defined in the UCC.

"Term" means the Closing Date through the close of business on the day
immediately preceding the third anniversary of the Closing Date, subject
to acceleration at the option of Laurus upon the occurrence of an Event
of Default hereunder or other termination hereunder.

"Term Note" means that certain Secured Convertible Term Note dated as of
the Closing Date made by Company in favor of Laurus in the original
principal amount of US$500,000, as the same may be amended, supplemented,
restated and/or otherwise modified from time to time.

"Total Investment Amount" means Five Million Five Hundred Thousand Dollars
in the lawful currency of the United States (US$5,500,000).

"Transferable Amount" has the meaning given such term in Section 2.1(a).

                                       65
<PAGE>

"UCC" means the Uniform Commercial Code as the same may, from time to time
be in effect in the State of New York; provided, that in the event that, by
reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of, or remedies with respect to, Laurus' Lien on
any Collateral is governed by the Uniform Commercial Code as in effect in
a jurisdiction other than the State of New York, the term "UCC" shall mean
the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions of this Agreement relating to such attachment,
perfection, priority or remedies and for purposes of definitions related
to such provisions; provided further, that to the extent that UCC is used
to define any term herein or in any Ancillary Agreement and such term is
defined differently in different Articles or Divisions of the UCC, the
definition of such term contained in Article or Division 9 shall govern.

"US Lockbox Bank" has the meaning given such term in Article 8(a).

"US Lockboxes" has the meaning given such term in Article 8(a).

"Vital Baby Transaction" means the transaction contemplated by the Company
to spin out its baby business.

"Warrant Shares" has the meaning given such term in Section 12.1.

"Warrants" means that certain Common Stock Purchase Warrant dated as of the
Closing Date made by  the Company in favor of Laurus and each other warrant
made by  the Company in favor of Laurus, as each of the same may be amended,
restated, modified and/or supplemented from time to time.

                                       66
<PAGE>

                                  EXHIBIT A

ELIGIBLE SUBSIDIARIES

        The International Mount Company Ltd., an Ontario corporation

        Infinity Technologies Inc., an Ontario corporation (will sign joinder
        agreement immediately following closing of acquisition)

                                       67
<PAGE>

                                  EXHIBIT B

BORROWING BASE CERTIFICATE

[To be inserted]

                                       68
<PAGE>

Schedule 1(a) Liens and Other Actions

                                     Reference File No.
                                     & Registration Number   Collateral
Secured Party(ies) Debtor (s)        (Registration Period)   Classification

Honda Canada                                                 Consumer Goods,
Finance Inc.       On The Go                                 Equipment, Motor
                   Healthcare Inc.   616110084 -             Vehicle, Amount
                                     20050615 1947 1531 3640 Secured $57,635
                                     (4 years)               Date of Maturity
                                                             20MAY2008,
                                                             2005 Acura MDX
GMAC Leaseco
Corporation        On The Go                                 Consumer Goods,
                   HealthCare        614135358 -             Equipment, Other
                                     20050412 1453 1530 4027 Motor Vehicle
                                     (4 years)               Amount Secured:
                                                             $37,693,
                                                             2005 Cadillac CTS
Porsche Financial
Services Canada    On The Go                                 Consumer Goods,
                   Healthcare Inc.                           Motor Vehicle,
                   Stuart Turk       611281692 -             Amount Secured
                                     20041210 1051 1529 0990 $82,664
                                     (4 years)               Date of Maturity
                                                             06DEC2008,
                                                             2005 Porsche
                                                             Cayenne S

Schedule 6(a) Tort Claims

        N/A

Schedule 7.1(c) List of Bank Accounts

Name on Account              Description  Bank .        Address   Phone No.

On The Go Healthcare, Inc.

On The Go Healthcare         CDN$         TD Commercial  (1)      905 660-5915
On The Go Healthcare         US$          TD Commercial  (1)      905 660-5915

* plus the 2 blocked accounts listed in the Blocked Account Agreement

The International Mount Company Ltd

On The Go                    CDN$         TD Bank        (2)      905 889-6204
On The Go                    US$          TD Bank        (2)      905 889-6204

Compuquest                   CDN$         TD Bank        (2)      905 889-6204
Compuquest                   US$          TD Bank        (2)      905 889-6204

Infinity Technologies Inc.

Infinity Technologies        CDN$         Royal Bank     (3)      905 897-8000
Infinity Technologies        US$          Royal Bank     (3)      905 897-8000

(1) 33 City Centre Drive Mississauga, Ontario L5B 2N5
(2) 441 Clarke Avenue West Thornhill, Ontario L4J 6W7
(3) 2300 Steeles Avenue West 2nd Floor Suite 200

                                       69
<PAGE>

Schedule 7.1(d)

Debtor          Secured Party    Max. Amount  Subordination   Other Action

On The Go
Healthcare      GMAC Leasing     $37,693      NA              Acknowledgement
                                                              that GSA is for
                                                              Vehicle
                                                              (from PPSA)
                Honda Canada
                Finance          $57,635      NA              None, PPSA is
                                                              limited to
                                                              specific
                                                              collateral
                Porsche financial
                Services         $82,664      NA              None, PPSA is
                                                              limited to
                                                              specific
                                                              collateral

Infinity        Jim Pattison     $24,339      NA              Acknowledgement
Technologies,   4 vehicles:      $57,975
Inc.                             $53,818
                                 $42,190

                Newcourt Financial    NA      NA              Discharge

                Business         $71,026      NA              Pay-off at
                Development                                   acquisition by
                Bank of Canada                                OGHC (from funds
                                                              in escrow).
                                                              Undertaking from
                                                              OGHC to make sure
                                                              discharge occurs
                                                              30 days after
                                                              acquisition of
                                                              Infinity

                Royal Bank of
                Canada           $650,000
                                 ($0 outstanding) NA          Undertaking by
                                                              Infinity to keep
                                                              the line of
                                                              credit with RBC
                                                              at a $0 balance.
                                                              Undertaking by
                                                              OGHC to not
                                                              borrow on this
                                                              facility and to
                                                              close the account
                                                              and discharge
                                                              the security
                                                              interest 5 days
                                                              from the  close
                                                              of the
                                                              acquisition of
                                                              Infinity

                                       70
<PAGE>

                Toshiba of Canada      NA       NA            Acknowledgement
                                                              that security
                                                              interest only
                                                              references
                                                              equipment Toshiba
                                                              supplies

The International Ingram Micro   $40,000      Yes             Acknowledgement
Mount Company Ltd.

                Bank of Nova Scotia    NA       NA            Misfiled PPSA,
                                                              have
                                                              acknowledgment
                                                              from Bank of
                                                              Nova Scotia
                                                              that there is
                                                              no security
                                                              interest in The
                                                              International
                                                              Mount Company
                                                              Ltd.

                Synnex of Canada

                Ingram Micro           NA       NA            Acknowledgement
                                                              received and
                                                              Officer's
                                                              Certification
                                                              that the PPSA
                                                              related to these
                                                              accounts do not
                                                              relate to OGHC
                                                              or its
                                                              subsidiaries

                TD Bank Overdraft
                Line of Credit   $25,000
                ($0 outstanding)                NA            Account closed
                                                              (7/12/05) and
                                                              to be discharged

                                       71
<PAGE>

Schedule 12.27 Company Name; Locations of Offices, Records and Collateral

        On The Go Healthcare, Inc.              85 Corstate Ave Unit #1
                                                Concord, Ontario, L4K 4Y2

        The International Mount Company Ltd.    85 Corstate Ave Unit #1
                                                Concord, Ontario, L4K 4Y2

        Infinity Technologies Inc.              5570 Kennedy Road Unit C,
                                                Mississauga, Ont. L4Z 2A9

        Note:   Infinity will relocate to 85 Corstate Ave Unit #1 Concord,
                Ontario, L4K 4Y2 as soon as the new office space is built.
                At the latest, this will occur October 1, 2005.

        ON THE GO HEALTHCARE, INC.
        85 Corstate Avenue, Unit #1
        Concord, Ontario, Canada L4K 4Y2

        Type of Entity:  Corporation
        Organizational ID number:  3263360
        State of Organization:  Delaware, USA

Schedule 12.28 Tangible Collateral

        On The Go Healthcare, Inc.              85 Corstate Ave Unit #1
                                        Concord, Ontario, L4K 4Y2

        The International Mount Company Ltd.    85 Corstate Ave Unit #1
                                        Concord, Ontario, L4K 4Y2

        Infinity Technologies Inc.              5570 Kennedy Road Unit C,
                                        Mississauga, Ont. L4Z 2A9

        Note:   Infinity will relocate to 85 Corstate Ave Unit #1 Concord,
                Ontario, L4K 4Y2 as soon as the new office space is built.
                At the latest, this will occur October 1, 2005.

Schedule 12.2 Subsidiaries

Subsidiary                           Direct Owner               Owner's Percent
                                                                Ownership

The International Mount Company Ltd. On The Go Healthcare, Inc. 100%

Infinity Technologies Inc.           On The Go Healthcare, Inc. 100% upon
                                                                closing of
                                                                share purchase

                                       72
<PAGE>

Schedule 12.3 Subsidiaries Capital Stock

The International Mount Company Ltd.               100 shares Common
                                                 1,000 shares Class A
                                                   100 shares Class B

Infinity Technologies Inc.                         100 shares Common
                                                       (upon closing)

Schedule 12.6 Agreements or Actions

        N/A

Schedule 12.7 Obligations to Related Parties

        None other than standard stock grants, warrants or options given
        to employees based on performance.

Schedule 12.9 Title to Properties and Assets

        N/A

Schedule 12.12 Litigation

        N/A

Schedule 12.13 Tax Returns and Payments

        N/A

Schedule 12.14 Employees

        N/A

Schedule 12(n)

        N/A

                                       73
<PAGE>

Schedule 12.15 Registration Rights and Voting Rights

        The original Shareholders of Infinity Technologies Inc will receive
        a minimum of 1,250,000 common shares or $1,500,000 CDN worth of common
        stock based on the stock price at closing (to be issued on closing).

        Key employees of Infinity Technologies Inc. will split 200,000
        restricted shares (to be issued on closing).

        Nadav Elituv or 964434 Ontario Inc. will be granted 50,000 shares
        and 50,000 "C" Warrants upon integration of Infinity Technologies Inc.
        (to be issued on closing).

        The items below have been issued as indicated:

        Name of Shareholder            Date Issued     Stock Issued     Shares

        DAVID CHILDS                   05/09/05        RESTRICTED       10,000
        DOUG CLARK                     05/09/05        RESTRICTED       25,000
        TONY DIVERONICA                05/09/05        RESTRICTED        7,500
        JENNIFER GARDINER              05/26/05        RESTRICTED       25,000
        STEVEN GRYFE                   03/23/05        RESTRICTED        2,000
        THIRUSENTHIL NAVARATNARAJH     05/09/05        RESTRICTED        5,000
        JOHN PENTONY                   03/23/05        RESTRICTED       17,500
        CAROLINE PILGRIM               05/09/05        RESTRICTED        5,000
        FRANK ABATE                    05/26/05        RESTRICTED      100,000
        BRETT W GOLD                   05/26/05        RESTRICTED       75,000
                                       05/26/05        "C" Warrants     75,000
        AL KAU                         05/09/05        RESTRICTED       20,000
                                       05/09/05       "C" Warrants      50,000

Schedule 12.17 Environmental and Safety Laws

        N/A

Schedule 12.21 SEC Reports and Financial Statements

        N/A

Schedule 13.12 Required Approvals

        N/A

                                       74
<PAGE>

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