Document:

WWW.EXFILE.COM, INC. -- 13681 -- CDKNET.COM, INC. -- EXHIBIT 10.2 TO FORM 8-K

    
      EXHIBIT
        10.2

      

      NEITHER
        THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON CONVERSION HEREOF HAVE
        BEEN
        REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE
        SECURITIES COMMISSION OF ANY STATE OR UNDER THE SECURITIES ACT OF 1933, AS
        AMENDED (THE “ACT”). THE SECURITIES ARE RESTRICTED AND MAY NOT BE OFFERED,
        RESOLD, PLEDGED OR TRANSFERRED EXCEPT AS PERMITTED UNDER THE ACT PURSUANT
        TO AN
        EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION FROM SUCH REGISTRATION
        REQUIREMENTS.

      

       

      
 

      
        	No.[ ___] 	
                $[______]
                  Principal
                  Amount 

              

      

       

      

      Original
        Issuance: _______, 2005

      

      CDKnet.com,
        Inc.

      

      6%
        CONVERTIBLE SUBORDINATED NOTE DUE JULY 7, 2007

      

      

      THIS
        NOTE
        is issued by
        CDKnet.com, Inc.,
        a
        Delaware corporation (the“Company”),
        and is
        part of an issue of an aggregate of up to Two Million Four Hundred Thousand
        Dollars ($2,400,000) principal amount of 6% Convertible Subordinated Notes
        due
        July 7, 2007 (the “Notes”).

      

      FOR
        VALUE
        RECEIVED, the Company promises to pay to [Holder],
        or
        permitted assigns (the“Holder”),
        the
        principal sum of _______ Thousand and
        00/100 (US $[___,000]) Dollars]
        on July
        7, 2007 (the “Maturity
        Date”)
        and to
        pay simple interest on the principal sum outstanding at the rate of 6% per
        annum. Accrual of interest shall commence on the date of initial issuance
        set
        forth the above (“Original
        Issuance”)
        and
        continue daily on the basis of a 360 day year until payment in full of the
        principal sum has been made or duly provided for. If the Maturity Date is
        not a
        business day in the State of New York, then such payment shall be made on
        the
        next succeeding business day. Subject to the provisions of Section 4 below,
        principal and accrued interest on this Note are payable in cash on the Maturity
        Date, at the address last appearing on the Note Register of the Company as
        designated in writing by the Holder from time to time. The Company will pay
        the
        principal of and any accrued but unpaid interest due upon this Note on the
        Maturity Date, less any amounts required by law to be deducted, to the
        registered holder of this Note as of the Maturity Date and addressed to such
        holder at the last address appearing on the Note register maintained by or
        on
        behalf of the Company (the “Note
        Register”).
        The
        forwarding of such check representing immediately available funds shall
        constitute a payment of principal and interest hereunder and shall satisfy
        and
        discharge the liability for principal and interest on this Note to the extent
        of
        the sum represented by such check, plus any amounts so deducted. This Note
        has
        been executed and delivered pursuant to the Securities
        Purchase Agreement between the Company and the original Holder (the “Purchase
        Agreement”),
        and is
        subject to the terms and conditions of the Purchase 

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      Agreement,
        which are, by this reference, incorporated herein and made a part hereof.
        Capitalized terms used and not otherwise defined herein shall have the meanings
        set forth for such terms in the Purchase Agreement.

      

      

      This
        Note
        is subject to the following additional provisions:

      

      1. Withholding
        and Issuance Taxes.
        The
        Company shall be entitled to withhold from all payments of principal of,
        and
        interest on, this Note any amounts required to be withheld under the applicable
        provisions of the United States income tax laws or other applicable laws
        at the
        time of such payments, and Holder shall execute and deliver all documentation
        reasonably required in connection therewith. The issuance of certificates
        for
        shares of common stock, $0.0001 par value (the “Common Stock”), of the Company
        upon conversion of this Note shall be made without charge to the Holder for
        any
        United States issuance tax in respect thereof, provided that the Company
        shall
        not be required to pay any tax that may be payable in respect of any transfer
        involved in the issuance and delivery of any certificate in a name other
        than
        that of the Holder of this Note.

      

      2. Transfer
        of Note.
        This
        Note has been issued subject to investment representations of the original
        purchaser hereof and may be transferred or exchanged only in compliance with
        the
        Securities Act of 1933, as amended (the “Securities
        Act”),
        and
        other applicable state and foreign securities laws. The Holder shall deliver
        written notice to the Company of any proposed transfer of this Note. In the
        event of any proposed transfer of this Note, the Company may require, prior
        to
        issuance of a new Note in the name of such other person, that it receive
        reasonable transfer documentation including legal opinions (at the Company’s
        expense) that the issuance of the Note in such other name does not and will
        not
        cause a violation of the Securities Act or any applicable state or foreign
        securities laws. Prior to due presentment for transfer of this Note, the
        Company
        and any agent of the Company may treat the person in whose name this Note
        is
        duly registered on the Company’s Note Register as the owner hereof for the
        purpose of receiving payment as herein provided and for all other purposes,
        whether or not this Note be overdue, and neither the Company nor any such
        agent
        shall be affected by notice to the contrary. 

      3. Conversion.
        The
        Holder of this Note is entitled, at its option, to convert, at any time during
        a
“Conversion
        Period”
        and
        subject to the applicable “Conversion
        Minimum”
        (each
        as defined below), the Principal Amount of this Note or any portion thereof,
        together with accrued and unpaid interest on such Principal Amount, into
        shares
        of Common Stock as follows:

      

      (a) Right
        to Convert.
        Subject
        to the terms, conditions, and restrictions of this Section 3, at any time
        during
        a Conversion Period (defined below), the Holder of this Note shall have the
        right to convert not less than the applicable Conversion Minimum (defined
        below)
        all or any portion of the Principal Amount of this Note, together with the
        accrued and unpaid interest on such Principal Amount so converted, into that
        number of fully-paid and non-assessable shares of Common Stock (rounded to
        the
        nearest whole share in accordance with Subsection 3(e)), at the Conversion
        Rate
        (as defined below).

       

      
        
           

        

        
          -2-

          
            

          

        

        
           

        

      

      
 

      (b) Conversion
        Rate and Other Definitions.
        The
        number of shares of Common Stock issuable upon conversion of all or any portion
        of the Principal Amount of this Note pursuant to Subsection (3)(a) shall
        be
        determined according to the following formula (the “Conversion
        Rate”):

      

      Conversion
        Amount

      Conversion
        Price.

      

      “Closing
        Bid Price”or“Closing
        Ask Price”
        means,
        for any security as of any date, the last closing bid or ask price, as the
        case
        may be, for such security on the Principal Market (as defined below) as reported
        by Bloomberg L.P. (“Bloomberg”),
        or,
        if the Principal Market is not the principal securities exchange or trading
        market for such security, the last closing bid or ask price of such security
        on
        the principal securities exchange or trading market where such security is
        listed or traded as reported by Bloomberg, or if the foregoing do not apply,
        the
        last closing bid or ask price of such security in the over-the-counter market
        on
        the electronic bulletin board for such security as reported by Bloomberg,
        or, if
        no closing bid or ask price is reported for such security by Bloomberg, the
        last
        closing trade price of such security as reported by Bloomberg, or, if no
        last
        closing trade price is reported for such security by Bloomberg, the average
        of
        the bid or ask prices of any market makers for such security as reported
        in the
“pink sheets” by the National Quotation Bureau, Inc. If the Closing Bid Price or
        Closing Ask Price cannot be calculated for such security on such date on
        any of
        the foregoing bases, the Closing Bid Price or Closing Ask Price of such security
        on such date shall be the fair market value as mutually determined by the
        Company and the holders of a majority of the currently outstanding Principal
        Amount of all Notes. If the Company and the Holders of the Notes are unable
        to
        agree upon the fair market value of the Common Stock, then such dispute shall
        be
        resolved pursuant to Subsection 3 (g). (All such determinations are to be
        appropriately adjusted for any stock dividend, stock split or other similar
        transaction during such period).

      

      “Conversion
        Amount”
        means
        that portion of this Note being converted by such Holder.

      

      “Conversion
        Date”
        means
        the date upon which the relevant Conversion Notice shall have been received
        by
        the Transfer Agent.

      

      “Conversion
        Minimum”
        means,
        with respect to a Conversion Period occasioned by an A Conversion Trigger,
        50%
        of principal amount registered to Holder and 100% during a conversion period
        occasioned by a B Conversion Trigger.

      

      “Conversion
        Period”
        means
        the period of 20 consecutive Trading Days following an A Conversion Trigger
        or a
        B Conversion Trigger.

      

      “Conversion
        Price”
        means,
        as of any Conversion Date or other date of determination (i) $1.125 during
        a
        Conversion Period following the occurrence of an A Conversion Trigger; or
        (ii)
        $1.575 during a Conversion Period following a B conversion Trigger; provided,
        that if a B Conversion Trigger occurs during a conversion Event following
        the
        occurrence of a B Conversion Trigger, the Conversion Price shall be the
        Conversion Price applicable on the day preceding the Conversion Date.

       

      
        
           

        

        
          -3-

          
            

          

        

        
           

        

      

      
 

      “Conversion
        Trigger”
        means, a
        period of five (5) consecutive Trading Days during which the Closing Bid
        Price
        exceeds: (i) in the case of an A Conversion Trigger, $1.50; and (ii) in the
        case
        of a B Conversion Trigger, $2.50.

      

      “Issuance
        Date”
        means
        the Closing Date as set forth in the Purchase Agreement.

      

      “Market
        Price”
        means
        the average of the Closing Bid Prices of the Common Stock on the Principal
        Market as reported by Bloomberg for the five (5) Trading Days immediately
        preceding the date of determination.

      

      “Principal
        Market”
        means
        the American Stock Exchange, the New York Stock Exchange, the NASDAQ National
        Market, the NASDAQ SmallCap Market, or the OTC Bulletin Board, or any other
        quotation medium upon which prices for shares are regularly published, whichever
        is at the time the principal trading exchange or market for the Common Stock,
        based upon share volume.

      

      “Trading
        Day”
        means
        any day during which the Principal Market shall be open for
        business.

      

      (c) Conversion
        Notice.
        The
        Holder of this Note may exercise its conversion right by giving a written
        conversion notice in the form of Exhibit A hereto (the “Conversion
        Notice”)
        to the
        Company’s transfer agent for its Common Stock, as designated by the Company from
        time to time (the “Transfer
        Agent”),
        (x)
        by facsimile or (y) by registered mail or overnight delivery service, with
        a
        copy by facsimile to the Company. . Upon receipt of a conversion notice from
        the
        Holder, the Company shall make a proper notation on the Note Register as
        to the
        remaining outstanding principal amount of the Notes registered in the name
        of
        the Holder which shall absent error, be conclusive and binding upon the Holder.
        Promptly, but in no event more than five (5) Trading Days after the receipt
        of a
        Conversion Notice converting the entire unpaid Principal Amount of this Note,
        the Holder of this Note shall surrender this Note to the Company (or such
        other
        office or agency of the Company as the Company may designate by notice in
        writing to the holders of the Notes).

      

      (d) Issuance
        of Certificates; Time Conversion Effected.
        

      

      (i) Promptly,
        but in no event more than seven (7) Trading Days after the receipt of the
        Conversion Notice referred to in Subsection 3(c), the Transfer Agent shall
        issue
        and deliver, or the Company shall cause to be issued and delivered, to the
        Holder, registered in such name or names as the Holder may direct, a certificate
        or certificates for the number of whole shares of Common Stock into which
        this
        Note has been converted. In
        the
        alternative, if the Transfer Agent is a participant in the electronic book
        transfer program, the Transfer Agent shall credit such aggregate number of
        shares of Common Stock to which the Holder shall be entitled to the Holder’s or
        its designee’s balance account with The Depository Trust Company. Such
        conversion shall be deemed to have been effected, and the Conversion Date
        shall
        be deemed to have occurred, on the date on which such Conversion Notice shall
        have been received by the Transfer Agent. The rights of the Holder of this
        Note
        shall cease, and the person or persons in whose name or names any certificate
        or
        certificates for shares of Common Stock shall be issuable upon such conversion
        shall be deemed to have become the Holder or Holders of 

       

      
        
           

        

        
          -4-

          
            

          

        

        
           

        

      

       

      record
        of
        the shares represented thereby, on the Conversion Date. Issuance of shares
        of
        Common Stock issuable upon conversion that are requested to be registered
        in a
        name other than that of the registered Holder shall be subject to compliance
        with all applicable federal and state securities laws.

      

      (ii) If,
        at
        any time, (a) the Company challenges, disputes or denies the right of the
        Holder
        to effect the conversion of this Note into Common Stock or otherwise dishonors
        or rejects, or causes the Transfer Agent to dishonor or reject, any Conversion
        Notice properly delivered in accordance with this Section 3 or (b) any third
        party who is not and has never been an affiliate of the Holder obtains a
        judgment or order from any court or public or governmental authority that
        denies, enjoins, limits, modifies, or delays the right of the Holder in addition
        to any and all other rights it may have to effect the conversion of this
        Note
        into Common Stock, then the Holder shall have the right, by written notice
        to
        the Company, to require the Company to promptly redeem this Note in accordance
        with Section 4. Under any of the circumstances set forth above, the Company
        shall indemnify the Holder against and hold it harmless from, and be responsible
        for the payment of, all costs and expenses of the Holder, including its
        reasonable legal fees and expenses, as and when incurred in disputing any
        such
        action or pursuing its rights hereunder (in addition to any other rights
        of the
        Holder), unless the Company or third party prevails. The Company shall not
        refuse to honor, or cause the Transfer Agent to refuse to honor, any Conversion
        Notice unless the Company or the Transfer Agent, as the case may be, has
        actually been enjoined by a court of competent jurisdiction from doing so
        and,
        if so enjoined, the Company shall post with such court a performance bond
        equal
        to 100% of the Conversion Amount of this Note sought to be converted by the
        Holder that is the subject of such injunction.

      

      (iii) The
        Holder of this Note shall be entitled to exercise its conversion privilege
        notwithstanding the commencement of any case under 11 U.S.C. § 101 et seq.
        (the
“Bankruptcy
        Code”).
        The
        Company hereby waives to the fullest extent permitted any rights to relief
        it
        may have under 11 U.S.C. § 362 in respect of the Holder’s conversion privilege,
        if the Company becomes a debtor under the Bankruptcy Code. The Company agrees
        to
        take or consent to any and all action necessary to effectuate relief under
        11
        U.S.C. § 362 without cost or expense to the Holder.

      

      (e) Fractional
        Shares.
        The
        Company shall not, nor shall it cause the Transfer Agent to, issue any fraction
        of a share of Common Stock upon any conversion. All shares of Common Stock
        (including fractions thereof) issuable upon conversion of this Note by the
        Holder shall be aggregated for purposes of determining whether the conversion
        would result in the issuance of a fraction of a share of Common Stock. If,
        after
        such final aggregation, the issuance would result in the issuance of a fraction
        of a share of Common Stock, the Company shall cause the Transfer Agent to
        issue
        one whole share of Common Stock in respect of such fraction of a share of
        Common
        Stock.

      

      (f) Adjustment
        to Conversion Price; Conversion Triggers; Dilution and Other
        Events.
        In order
        to prevent dilution of the rights granted under this Note, the Conversion
        Price
        will be subject to adjustment from time to time as provided in this Subsection
        3(f).

      

      
        
           

        

        
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      (i) Adjustment
        of Applicable Conversion Prices and Triggers upon Subdivision or Combination
        of
        Common Stock.
        If the
        Company at any time subdivides (by any stock split, stock dividend,
        recapitalization or otherwise) one or more classes of its outstanding shares
        of
        Common Stock into a greater number of shares, the applicable Conversion Prices
        immediately prior to such subdivision will be thereafter proportionately
        reduced. If the Company at any time combines (by combination, reverse stock
        split or otherwise) one or more classes of its outstanding shares of Common
        Stock into a smaller number of shares, the applicable Conversion Price and
        Triggers immediately prior to such combination will be thereafter
        proportionately increased.

       

      (ii) Reorganization,
        Reclassification, Consolidation, Merger or Sale.
        Any
        recapitalization, reorganization, reclassification, consolidation, merger,
        sale
        of all or substantially all of the Company’s assets to another Person (as
        defined below) or other transaction which is effected in such a way that
        holders
        of Common Stock are entitled to receive (either directly or upon subsequent
        liquidation) stock, securities or assets with respect to or in exchange for
        Common Stock is referred to herein as an “Organic
        Change.”
        Prior
        to the consummation of any Organic Change, the Company will make appropriate
        provision (in form and substance reasonably satisfactory to the Holder) to
        insure that the Holder will thereafter have the right to acquire and receive
        in
        lieu of or in addition to (as the case may be) the shares of Common Stock
        otherwise acquirable and receivable upon the conversion of this Note, such
        shares of stock, securities or assets as would have been issued or payable
        in
        such Organic Change with respect to or in exchange for the number of shares
        of
        Common Stock that would have been acquirable and receivable had this Note
        been
        converted into shares of Common Stock immediately prior to such Organic Change
        (without taking into account any limitations or restrictions on the timing
        or
        amount of conversions). In any such case, the Company will make appropriate
        provision (in form and substance reasonably satisfactory to the Holder) with
        respect to the Holder’s rights and interests to insure that the provisions of
        this Section 3(f) will thereafter be applicable to this Note (including,
        in the
        case of any such consolidation, merger or sale in which the successor entity
        or
        purchasing entity is other than the Company, an immediate adjustment of the
        Maximum Conversion Price in accordance with Subsection 3(f)(i) using the
        value
        for the Common Stock reflected by the terms of such consolidation, merger
        or
        sale, if the value so reflected is less than the Maximum Conversion Price
        in
        effect immediately prior to such consolidation, merger or sale). The Company
        will not effect any such consolidation, merger or sale, unless prior to the
        consummation thereof, the successor entity (if other than the Company) resulting
        from consolidation or merger or the entity purchasing such assets assumes,
        by
        written instrument (in form and substance reasonably satisfactory to the
        holders
        of a more than fifty percent (50%) of Principal Amount of the Notes then
        outstanding), the obligation to deliver to each holder of Notes such shares
        of
        stock, securities or assets as, in accordance with the foregoing provisions,
        such holder may be entitled to acquire. “Person”
        shall
        mean an individual, a limited liability company, a partnership, a joint venture,
        a corporation, a trust, an unincorporated organization and a government or
        any
        department or agency thereof.

      

      (g) Dispute
        Resolution.
        In the
        case of a dispute as to the determination of the Closing Ask Price or Closing
        Bid Price of any security or the arithmetic calculation of the Conversion
        Rate,
        the Company shall, or shall cause the Transfer Agent to, promptly issue to
        the
        Holder the number of shares of Common Stock that is not disputed and shall
        submit the disputed determinations or arithmetic calculations to the Holder
        via
        facsimile within one (1) business day 

       

      
        
           

        

        
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      of
        receipt of the Holder’s Conversion Notice. If the Holder and the Company are
        unable to agree upon the determination of such Closing Ask Price or Closing
        Bid
        Price, as the case may be, or the arithmetic calculation of the Conversion
        Rate
        within one (1) business day of such disputed determination or arithmetic
        calculation being submitted to the Holder, then the Company shall within
        one (1)
        business day following such date of delivery submit via facsimile (A) the
        disputed determination of the Closing Ask Price or Closing Bid Price, as
        the
        case may be, to an independent, reputable investment bank or (B) the disputed
        arithmetic calculation of the Conversion Rate to its independent certified
        public accounting firm. The Company shall cause the investment bank or the
        accounting firm, as the case may be, to perform the determinations or
        calculations and notify the Company and the Holder of the results no later
        than
        forty-eight (48) hours from the time it receives the disputed determinations
        or
        calculations. Such investment bank’s or accounting firm’s determination or
        calculation, as the case may be, shall be binding upon all parties absent
        manifest error.

      

      4. Redemption;
        Forced Conversion.
        

      

      (a) Redemption
        at the Option of the Company.
        At
        any
        time after the initial issuance of the Notes, the Company, upon delivery
        to the
        holders of the then outstanding Notes of an “Optional
        Redemption Notice” in the manner provided in Subsection 4(b), may redeem in
        whole or in part the Notes (but only with respect to the Amount as to which
        such
        holders have not theretofore furnished a Conversion Notice in compliance
        with
        Subsection 3(c), at a price (the “Optional Redemption Price”) equal to the sum
        of (a) 120% of the Principal Amount and (b) the accrued interest thereon;
        provided
        at the
        time the Optional Redemption Notice is given: 

      

      (i) the
        Company has set aside the full Optional Redemption Price payable and sent
        the
        funds to a bank or trust company solely to act as payment agent;

      

      (ii) the
        shares of the Company’s Common Stock are listed on a national securities
        exchange, traded on Nasdaq or quotations found in the Over-the-Counter Bulletin
        Board; 

      

      (iii) the
        Closing Bid Price for shares of Common Stock have equaled or exceeded the
        A
        Trigger for twenty (20) consecutive Trading Days immediately preceding the
        date
        the Optional Redemption Notice is given and such notice is given, not later
        than
        the 15 Trading Days after this condition is fulfilled;

      

      (iv) not
        less
        than 20,000 shares of Common Stock have traded on each of the twenty (20)
        Trading Days immediately preceding the date the Optional Redemption Notice
        is
        given;

      

      (v) the
        Company is current in its obligation to file periodic reports under Section
        13
        or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)
        and has been current in such filings for at least ninety (90) days preceding
        the
        date of the Optional Redemption Notice; 

      

      (vi) the
        shares of Common Stock issuable upon conversion of the Notes pursuant to
        Section
        3(a) are the subject of an effective registration statement under the Securities
        

       

      
        
           

        

        
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      Act
        that
        would permit the resale of such shares without limitation (other than customary
        limitations and the Company, by the giving of such Option Redemption Notice
        shall agree to keep such registration statement current until such time as
        all
        of such shares may be resold pursuant to Rule 144 without regard to the volume
        limitation of such rule, and provided further that in effecting such
        registration, the Company shall be bound by Section 7.3 of the Purchase
        Agreement; and

      

      (vii) the
        Company is not in breach or default under the note or of any representations,
        warranties or covenants in the Purchase Agreement.

      

      (b) Notice
        of Redemption.
        

      

      (i)
         Notice
        of
        redemption pursuant to Subsection 4(a) (the “Optional Redemption Notice”) shall
        be provided by the Company to the Holder in writing (by overnight courier
        at the
        Holder’s last address appearing in the Note Register not less than fifteen (15)
        nor more than thirty (30) days prior to the date stipulated by the Company
        for
        the redemption of the Notes (the “Optional Redemption Date”), which notice shall
        specify the Optional Redemption Date and refer to Subsection 4(a) and this
        Subsection 4(b).

      

      (ii)
         Upon
        receipt of the Optional Redemption Notice, the Holder shall have the option,
        at
        its sole election, to specify what portion of the Notes called for redemption
        in
        the Optional Redemption Notice shall be redeemed as provided in Subsection
        4(a)
        or converted into Common Stock in the manner provided in Subsection 3(a).
        If the
        Holder elects to convert any portion of the Notes, then such conversion shall
        take place on the Conversion Date specified by the Holder, but in no event
        after
        the Optional Redemption Date, in accordance with the terms of Subsection
        3(a).

      

      (c) Forced
        Conversion.
        During
        a
        period of ten (10) Trading Days following a period of twenty (20) consecutive
        Trading Days during which the Closing Bid Price of shares of Common Stock
        have
        equaled or exceeded the B Trigger, the Company may, at its option, upon notice
        delivered to the Holders of the then outstanding Notes (the “Mandatory
        Conversion Notice”
        in the
        same manner as an Optional Redemption Notice, set a date (a “Mandatory
        Conversion Date”)
        on
        which all such Notes shall be automatically converted into shares of Common
        Stock in the manner set forth in Section 3(b); provided each of the conditions
        set forth in Section 4(a)(i), (ii) and (iv) to (vii) have been
        fulfilled.

      

      (d) Surrender
        of Notes. 

      

      (i) Upon
        any
        redemption of this Note pursuant to Subsection 4(a), the Holder shall either
        deliver the Note by hand to the Company at its principal executive offices
        or
        surrender the same to the Company at such address by express courier. Payment
        of
        the Optional Redemption Price specified in Subsection 4(a) shall be made
        by the
        Company to the Holder against receipt of the Notes by wire transfer of
        immediately available funds to such account(s) as the Holder shall specify
        in
        writing to the Company. Provided the Company has either paid or set aside
        available funds for sufficient to pay the Optional Redemption Price (and
        in the
        latter case, set aside funds are in a segregated account identified to the
        Holder from which the Optional Redemption Price will be paid on or after
        the
        Optional Redemption Date upon demand of the 

       

      
        
           

        

        
          -8-

          
            

          

        

        
           

        

      

       

      Holder),
        from and after the Optional Redemption Date, the Holders rights as a holder
        of
        this Note shall cease, except the right to receive the Optional Redemption
        Price. 

      

      (ii) From
        and
        after the Mandatory Conversion Date, the Holders rights as a holder of this
        Note
        shall cease, except the right to receive the shares of Common Stock issuable
        upon conversion. Delivery of the shares of Common Stock issued upon such
        conversion shall be made against receipt of the Notes.

      

      5. Notices.
        In case
        at any time:

      

      (a) the
        Company shall declare any dividend upon its Common Stock payable in cash
        or
        stock or make any other pro rata distribution to the holders of its Common
        Stock; or 

      

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

      

      (c) there
        shall be any capital reorganization or reclassification of the capital stock
        of
        the Company, or a consolidation or merger of the Company with or into, or
        a sale
        of all or substantially all its assets to, another entity or entities; or
        

      

      (d) there
        shall be a voluntary or involuntary dissolution, liquidation or winding up
        of
        the Company; then, in any one or more of said cases, the Company shall give,
        by
        first class mail, postage prepaid, or by telex or facsimile or by recognized
        overnight delivery service, addressed to the Holder at the address of the
        Holder
        as shown on the books of the Company, (i) at least 10 days’ prior written notice
        of the date on which the books of the Company shall close or a record shall
        be
        taken for such dividend, distribution or subscription rights or for determining
        rights to vote in respect of any such reorganization, reclassification,
        consolidation, merger, sale, dissolution, liquidation or winding up and (ii)
        in
        the case of any such reorganization, reclassification, consolidation, merger,
        sale, dissolution, liquidation or winding up, at least ten (10) days’ prior
        written notice of the date when the same shall take place. Such notice in
        accordance with the foregoing clause (i) shall also specify, in the case
        of any
        such dividend, distribution or subscription rights, the date on which the
        holders of Common Stock shall be entitled thereto and (ii) shall also specify
        the date on which the holders of Common Stock shall be entitled to exchange
        their Common Stock for securities or other property deliverable upon such
        reorganization, reclassification, consolidation, merger, sale, dissolution,
        liquidation or winding up, as the case may be.

      

      6. Stock
        to be Reserved.
        The
        Company has a sufficient number of shares of Common Stock available to reserve
        for issuance upon the conversion of all outstanding Notes. The Company will
        at
        all times reserve and keep available out of its authorized Common Stock,
        solely
        for the purpose of issuance upon the conversion of all of its Notes as herein
        provided, such number of shares of Common Stock as shall then be issuable
        upon
        the conversion of all Notes. The Company covenants that all shares of Common
        Stock that shall be so issued shall be duly and validly issued, fully-paid
        and
        non assessable. The Company will take all such action as may be so taken
        without
        violation of any applicable law or regulation to have a sufficient number
        of
        authorized but unissued shares of Common Stock to issue upon conversion of
        all
        Notes. The Company will not take any action that results in any adjustment
        of
        the conversion rights if the 

       

      
        
           

        

        
          -9-

          
            

          

        

        
           

        

      

       

      total
        number of shares of Common Stock issued and issuable after such action upon
        conversion of this Note would exceed the total number of shares of Common
        Stock
        then authorized by the Company’s Certificate of Incorporation or if the issuance
        thereof would cause the shares to be issued for less than the par value
        thereof.

      

      7. Event
        of Default.
        Each
        of
        the following shall constitute an “Event
        of Default”:

      

      (a) the
        Company shall default in the payment of principal or interest on this Note
        and
        same shall continue for a period of five (5) days; or

      

      (b) any
        of
        the material representations, warranties or covenants made by the Company
        herein, in the Purchase Agreement, or in any agreement, certificate or financial
        or other written statements heretofore or hereafter furnished by the Company
        in
        connection with the execution and delivery of this Note or the Purchase
        Agreement, shall be false or misleading in any material respect at the time
        made, or has breached a material covenant contained in this Note or the Purchase
        Agreement, and such default is not cured within fourteen (14) days of receipt
        of
        written notice specifying the nature of the misrepresentation; or 

      

      (c) the
        Company shall (i) make an assignment for the benefit of creditors or commence
        proceedings for its dissolution; or (ii) apply for or consent to the appointment
        of a trustee, liquidator or receiver for its or for a substantial part of
        its
        property or business; or

      

      (d) a
        trustee, liquidator or receiver shall be appointed for the Company or for
        a
        substantial part of its property or business without its consent and shall
        not
        be discharged within sixty (60) days after such appointment; or

      

      (e) any
        governmental agency or any court of competent jurisdiction at the instance
        of
        any governmental agency shall assume custody or control of the whole or any
        substantial portion of the properties or assets of the Company and shall
        not be
        dismissed within sixty (60) days thereafter; or

      

      (f) any
        final
        money judgment, writ or warrant of attachment, or similar process in excess
        of
        Two Hundred Thousand ($200,000) Dollars in the aggregate shall be entered
        or
        filed against the Company or any of its properties or other assets and shall
        remain unpaid, unvacated, unbonded or unstayed for a period of sixty (60)
        days
        or in any event later than five (5) days prior to the date of any proposed
        sale
        thereunder; or

      

      (g) bankruptcy,
        reorganization, insolvency or liquidation proceedings or other proceedings
        for
        relief under any bankruptcy law or any law for the relief of debtors shall
        be
        instituted by or against the Company and, if instituted against the Company,
        shall not be dismissed within sixty (60) days after such institution or the
        Company shall by any action or answer approve of, consent to, or acquiesce
        in
        any such proceedings or admit the material allegations of, or default in
        answering, a petition filed in any such proceeding. 

       

      8. Acceleration
        and Remedies

      

      (a) Acceleration
        of Maturity.
        If any
        Event of Default shall have occurred and be 

       

      
        
           

        

        
          -10-

          
            

          

        

        
           

        

      

       

      continuing,
        the Holder or Holders of at least 50% in aggregate principal amount of
        outstanding Notes may, by notice to the Company, declare the entire outstanding
        principal balance of the Notes, and all accrued and unpaid interest the thereon,
        to be due and payable immediately, and upon any such declaration the entire
        outstanding principal balance of the Notes, if any, and said accrued and
        unpaid
        interest shall become and be immediately due and payable, without presentment,
        demand, protest or other notice. whatsoever, all of which are hereby expressly
        waived, anything in the Notes or in this Agreement to the contrary
        notwithstanding; provided
        that if
        an Event of Default under paragraph (a), (c), (d), (e) or (g) of Section
        7 with
        respect to the Company or any Subsidiary shall have occurred, the outstanding
        principal amount of all of the Notes, and all accrued and unpaid interest
        thereon, shall immediately become due and payable in cash, without any
        declaration and without presentment, demand, protest or other notice whatsoever,
        all of which are hereby expressly waived, anything in this Note to the contrary
        notwithstanding.

       

      (b) Other
        Remedies.
        If any
        Event of Default shall have occurred and be continuing, from and including
        the
        date of such Event of Default to but not including the date such Event of
        Default is cured or waived, interest will accrue at an annual default rate
        of
        12% and, any Holder may enforce its rights by suit in equity, by action at
        law,
        or by any other appropriate proceedings, whether for the specific performance
        (to the extent permitted by law) of any covenant or agreement contained in
        the
        Purchase Agreement or the Notes or in aid of the exercise of any power granted
        or theNotes, and any Holder may enforce the payment of any Note held by such
        Holder and any of its other legal or equitable rights.

      

      (c)
         Conduct
        no Waiver; Collection Expenses.
        No
        course of dealing on the part of any Holder, nor any delay or failure on
        the
        part of any Holder to exercise any of its rights, shall operate as a waiver
        of
        such right or otherwise prejudice such Holders rights, powers and remedies.
        If
        the Company fails to pay, when due, the principal or the premium, if any,
        or the
        interest on any Note, the Company will pay to each Holder, to the extent
        permitted by law, on demand, all costs and expenses incurred by such Holder
        in
        the collection of any amount due in respect of any Note hereunder, including
        reasonable legal fees incurred by such Holder in enforcing its rights
        hereunder.

      

      (d) Annulment
        of Acceleration.
        If a
        declaration is made in accordance with paragraph 8(a), then and in every
        such
        case, the Holder or Holders of at least 50% in aggregate principal amount
        of
        outstanding Notes may, by an instrument delivered to the Company, annul such
        declaration and the consequences thereof, provided
        that at
        the time such declaration is annulled:

      

      (i) no
        judgment or decree has been entered for the payment of any monies due on
        the
        Notes or pursuant to the Purchase Agreement;

       

      (ii) all
        arrears of interest on the Notes and all other sums payable on the Notes
        and
        pursuant to this Agreement (except any principal of or interest or premium
        on
        the Notes which has become due and payable by reason of such declaration)
        shall
        have been duly paid; and

       

      (iii)
        every other Event of Default shall have been duly waived or otherwise made
        good
        or cured;

       

      provided, however,
        that
        only the Holder of the Note or Notes making the declaration permitted

       

      
        
           

        

        
          -11-

          
            

          

        

        
           

        

      

       

      by
        the of
        paragraph 8(b) may annul such declaration; and provided, further,
        that no
        such annulment
        shall extend to or affect any subsequent Event of Default or impair any right
        consequent thereon.

      

      (e) Remedies
        Cumulative.
        No
        right or remedy conferred upon or reserved to the Holders of Notes is intended
        to be exclusive of any other right or remedy, and every right and remedy
        shall
        be cumulative and in addition to every other right and remedy given hereunder
        or
        now and hereafter existing under applicable law. Every right and remedy given
        by
        the Purchase Agreement or by applicable Law to the Holders of Notes may be
        exercised from time to time and as often as may be deemed expedient by the
        Holders. Without limiting the generality of the foregoing, if the Event of
        Default is the result of the Company’s breach of its obligation to convert the
        indebtedness evidenced by the Notes into Common Stock in accordance with
        the
        terms and conditions hereof, the Holder shall be entitled to specific
        performance of such obligation of the Company; it being expressly acknowledged
        and agreed by the Company that no adequate remedy at law exists for any such
        breach and that the Holder will be irreparably harmed by any such breach
        by the
        Company.

      

      9. No
        Recourse to Stockholders, etc.
        No
        recourse shall be had for the payment of the principal of, or the interest
        on,
        this Note, or for any claim based hereon, or otherwise in respect hereof,
        against any incorporator, shareholder, employee, officer or director, as
        such,
        past, present or future, of the Company or any successor corporation, whether
        by
        virtue of any statute or rule of law, or by the enforcement of any assessment
        or
        penalty or otherwise, all such liability being, by the acceptance hereof
        and as
        part of the consideration for the issue hereof, expressly waived and
        released.

       

      10. Subordination
        of Notes.

      

      (a) Subordination
        of Notes
        to Senior Indebtedness.
        The
        indebtedness evidenced by the Notes and all renewals and extensions thereof,
        all
        other instruments and agreements arising out of or relating to any or all
        of the
        foregoing and all renewals and extensions thereof (collectively, the
“Junior
        Indebtedness”)
        shall
        at all times be wholly subordinate and junior in right of payment to any
        and all
        Senior Indebtedness of the Company (including any claims by the holders of
        such
        Senior Indebtedness for interest accruing after any assignment for the benefit
        of creditors by the Company or the institution by or against the Company
        of any
        proceedings under the Bankruptcy Code or any law for the relief of or relating
        to debtors, or any other claim by such holders for any such interest which
        would
        have accrued in the absence of such assignment or the institution of such
        proceedings) in the manner and with the force and effect hereafter set
        forth:

      

      (i) In
        the
        event of any liquidation, dissolution or winding up of the Company, or of
        any
        execution, sale, receivership, insolvency, bankruptcy, liquidation,
        readjustment, reorganization or other similar proceeding relative to the
        Company
        or its property, all sums owing on all Senior Indebtedness of the Company
        (including cash collateral and amounts not yet due and payable) shall first
        be
        paid in full in cash, or provision shall be made for such payment in money
        or
        money’s worth, before any payment is made upon the Junior Indebtedness; and if
        in any such event any payment or distribution, whether in cash, property,
        or
        securities shall be made upon or in respect of the Junior Indebtedness at
        a time
        when such payment is prohibited 

       

      
        
           

        

        
          -12-

          
            

          

        

        
           

        

      

       

      under
        this Section 10, the same shall be paid over to the holders of the Senior
        Indebtedness of the Company, pro rata, for application in payment thereof
        unless
        and until such Senior Indebtedness shall have been paid or satisfied in full
        in
        cash, or provision shall be made for such payment in money or money’s
        worth.

      

      In
        case
        of any assignment for the benefit of creditors by the Company or in case
        any
        proceedings under the Bankruptcy Code or any other law for the relief of
        or
        relating to debtors are instituted by or against the Company, or in case
        of the
        appointment of any receiver for the Company’s business or assets, or in case of
        any dissolution or winding up of the affairs of the Company, the Company
        and any
        assignee, trustee in bankruptcy, receiver, debtor in possession or other
        person
        or persons in charge are hereby directed to pay to the holders of the Senior
        Indebtedness of the Company the full amount of such holders claims against
        the
        Company (including interest to the date of payment) in cash, or provision
        shall
        be made for such payment in money or money’s worth, before making any payments
        to the holders of Junior Indebtedness, and insofar as may be necessary for
        that
        purpose, each holder of the Notes hereby assigns and transfers to the holders
        of
        Senior Indebtedness of the Company all rights to any payments, dividends
        or
        other distributions.

      

      (ii) In
        the
        event that all or any part of the Junior Indebtedness is declared or becomes
        due
        and payable because of the occurrence of any Event of Default or otherwise
        than
        at the option of the Company (other than pursuant to its terms at its final
        maturity or upon a Change in Control), under circumstances when the foregoing
        clause (a) shall not be applicable, the holders of the Junior Indebtedness
        shall
        be entitled to payments only after there shall first have been paid in full
        in
        cash, or provision shall be made for such payment in money or money’s worth, all
        Senior Indebtedness of the Company or payment shall have been provided therefor
        in a manner satisfactory to the holders of such Senior
        Indebtedness.

      

      (iii) For
        purposes of this Section 10 only, the words “cash, property or
        securities” shall
        (so
        long as the effect of this paragraph is not to cause the Note to be treated
        in
        any case or proceeding or other event described in this Section as part of
        the
        same class of claims as any Senior Indebtedness or any class of claims on
        a
        parity with or senior to any Senior Indebtedness for any payment or
        distribution) not be deemed to include shares of stock of the Company as
        reorganized or readjusted, or securities of the Company or any other corporation
        provided for by a plan of reorganization or readjustment which are subordinated
        in right of payment to all Senior Indebtedness which may at the time be
        outstanding to substantially the same extent as, or to a greater extent than,
        the Notes are so subordinated as provided in this Section 10. The consolidation
        of the Company with, or the merger of the Company into, another Person or
        the
        liquidation or dissolution of the Company following the sale or transfer
        of its
        properties and assets substantially as an entirety to another Person upon
        the
        terms and conditions set forth in this Agreement shall not be deemed a
        dissolution, winding up, liquidation, reorganization, assignment for the
        benefit
        of creditors or marshaling of assets and liabilities of the Company for the
        purposes of this Section if the Person formed by such consolidation or into
        which the Company is merged or which acquires by sale or transfer such
        properties and assets substantially as an entirety, as the case may be, shall,
        as a part of such consolidation, merger, sale or transfer, comply with the
        conditions set forth in this Agreement.

       

      
        
           

        

        
          -13-

          
            

          

        

        
           

        

      

      
 

      In
        the
        event and during the continuance of any event of default with respect to
        any
        Senior Indebtedness pursuant to which the maturity thereof may be accelerated,
        upon receipt by the Company and the holders of the Notes of written notice
        of
        such event of default from the holders of such Senior Indebtedness, then,
        unless
        and until such event of default shall have been cured or waived or shall
        have
        ceased to exist, no direct or indirect payment (in cash, property, securities,
        by set-off or otherwise) shall be made or agreed to be made on account of
        the
        principal of, premium, if any, or interest on the Junior Indebtedness, or
        in
        respect of any retirement, purchase or other acquisition by the Company of
        any
        of the Junior Indebtedness, for a period (a “Blockage
        Period”)
        commencing as of the earlier of the date of receipt of such notice or, if
        applicable, the date of such acceleration of the Senior Indebtedness, and
        ending
        one-hundred-twenty (120) days thereafter (unless such Blockage Period shall
        be
        terminated by written notice to the holders of the Notes from such holders
        of
        Senior Indebtedness commencing the Blockage Period). Not more than one (1)
        Blockage Period may be commenced with respect to the Junior Indebtedness
        during
        any period of 360 consecutive days. For all purposes of this paragraph (c),
        no
        event of default which existed or was continuing on the date of the commencement
        of any Blockage Period shall be, or be made, the basis for the commencement
        of a
        second Blockage Period by the holders of such Senior Indebtedness whether
        or not
        within a period of three-hundred-sixty (360) consecutive days unless such
        event
        of default shall have been cured or waived for a period of not less than
        ninety
        (90) consecutive days.

      

      (iv) All
        payments, cash, or noncash distributions made to the holders of Junior
        Indebtedness which should have been made to the holders of Senior Indebtedness
        of the Company shall be received and held by the former in trust for the
        benefit
        of the latter, and the holders of Junior Indebtedness shall forthwith remit
        such
        payments, cash, or noncash distributions to the holders of the Senior
        Indebtedness of the Company, pro rata, in the form in which it was received,
        together with such endorsements or documents as may be necessary to effectively
        negotiate or transfer the same to the holders of the Senior Indebtedness
        of the
        Company.

      

      (v) Each
        holder of Senior Indebtedness of the Company is hereby authorized by the
        holders
        of Junior Indebtedness to:

      

      
        	 	
                (A)

              	
                renew,
                  compromise, extend, accelerate or otherwise change the time of
                  payment, or
                  any other terms, of any Senior Indebtedness of the Company held
                  by such
                  holder;

              

      

      

      
        	 	
                (B)

              	
                increase
                  or decrease the rate of interest payable thereon or any part
                  thereof

              

      

      

      
        	 	
                (C)

              	
                exchange,
                  enforce, waive or release any security
                  therefor;

              

      

      

      
        	 	
                (D)
                  

              	
                apply
                  such security and direct the order or manner of sale thereof in
                  such
                  manner as such holder may at its discretion determine;
                  and/or

              

      

      

      
        	 	
                (E)

              	
                release
                  the Company or any guarantor of any Senior Indebtedness of the
                  Company
                  from liability;

              

      

       

      
        
           

        

        
          -14-

          
            

          

        

        
           

        

      

      
 

      all
        without notice to any holder of Junior Indebtedness and without affecting
        the
        subordination provided by this Agreement.

      

      Notwithstanding
        anything set forth in this paragraph 10(a), nothing set forth herein shall
        restrict holders of the Notes from exercising their rights of conversion
        hereunder.

      

      (b) Proofs
        of Claim of Holders of Senior Indebtedness; Voting.
        Each
        holder of Junior Indebtedness undertakes and agrees for the benefit of each
        holder of Senior Indebtedness of the Company to execute, verify, deliver
        and
        file any proofs of claim relating to the Junior Indebtedness which any holder
        of
        such Senior Indebtedness may at any time require in order to prove and realize
        upon any rights or claims pertaining to the Junior Indebtedness and to
        effectuate the full benefit of the subordination contained herein. Upon failure
        of any holder of Junior Indebtedness to file the required proof or proofs
        of
        claim prior to thirty (30) days before the expiration of the time to file
        claims
        in such proceeding, each holder of Senior Indebtedness of the Company is
        hereby
        irrevocably appointed by such holder of Junior Indebtedness to be such holder’s
        agent to file the appropriate claim or claims and if such holder of Senior
        Indebtedness elects at its sole discretion to file such claim or claims (i)
        to
        accept or reject any plan of reorganization or arrangement on behalf of such
        holder, and (ii) to otherwise vote such holder’s claim in respect of the Junior
        Indebtedness in any manner deemed appropriate for the benefit and protection
        of
        the holders of the Senior Indebtedness of the Company.

      

      (c)
         Rights
        of Holders of Senior Indebtedness Unimpaired.
        No
        right of any holder of any Senior Indebtedness to enforce subordination as
        herein provided shall at any time or in any way be affected or impaired by
        any
        failure to act on the part of the Company or the holders of Senior Indebtedness,
        or by any noncompliance by the Company with any of the terms, provisions
        and
        covenants of this Agreement, regardless of any knowledge thereof that any
        such
        holder of Senior Indebtedness may have or be otherwise charged
        with.

      

      (d) Effects
        of Event of Default.
        The
        Company agrees, for the benefit of the holders of Senior Indebtedness, that
        in
        the event that any Note is declared due and payable before its maturity because
        of the occurrence of an Event of Default, the Company will give prompt notice
        in
        writing of such happening to the holders of Senior Indebtedness.

      

      (e) Company’s
        Obligations Unimpaired.
        The
        provisions of this Article

      10
        are
        solely for the purpose of defining the relative rights of the holders of
        Senior
        Indebtedness on the one hand, and the holders of Junior Indebtedness on the
        other hand, and nothing herein shall impair, as between the Company and the
        holders of Junior Indebtedness, the obligation of the Company which is
        unconditional and absolute, to pay the principal, premium, if any, and interest
        on the Notes in accordance with this Agreement and the terms of the Notes,
        nor
        shall anything herein prevent any holder of Junior Indebtedness from exercising
        all remedies otherwise permitted by applicable law or under this Agreement
        or
        the Notes upon the occurrence of an Event of Default, subject to the rights
        of
        the holders of Senior Indebtedness as herein provided for.

      

      (f) Subrogation.
        Subject
        to the payment in full of Senior Indebtedness, holders of the Notes shall
        be
        subrogated to the rights of the holders of Senior Indebtedness to receive
        payments or distributions of cash, property or securities made on the Senior
        Indebtedness until 

       

      
        
           

        

        
          -15-

          
            

          

        

        
           

        

      

       

      the
        Senior Indebtedness shall be paid in hill in cash; and, for the purposes
        of such
        subrogation, payments or distributions to the holders of Senior Indebtedness
        of
        any cash, property or securities to which any holder of Notes would be entitled
        except for the provisions of this Agreement shall, as between the Company
        and
        its creditors other than the holders of Senior Indebtedness and holders of
        the
        Notes, be deemed to be a payment by the Company to or on account of the Notes,
        it being understood that the provisions of this Agreement are and are intended
        solely for the purpose of defining the relative rights of the holders of
        the
        Notes on the one hand, and the holders of Senior Indebtedness, on the other
        hand. The purpose of this paragraph 10(f) is to grant to holders of the Notes
        the same rights against the Company with respect to the aggregate amount
        of such
        payments or distributions as the holders of Senior Indebtedness would have
        against the Company if such aggregate amount were considered overdue Senior
        Indebtedness.

      

      11. No
        Rights as Stockholder.
        No
        provision of this Note shall be construed as conferring upon the Holder the
        right to vote or to receive dividends or to consent or receive notice as
        a
        stockholder in respect of any meeting of stockholders or any rights whatsoever
        as a stockholder of the Company, unless and to the extent converted in
        accordance with the terms hereof.

      

      12. Definitions.
        As used
        in this Note, 

      

      (a) “Affiliate”
        and
“Associate”
        shall
        have the respective meanings ascribed to such terms in Rule 12b-2 of the
        General
        Rules and Regulations under the Exchange Act. 

      

      (b) “Beneficially
        Owned”
        with
        respect to any securities shall mean having “beneficial ownership” of such
        securities (as determined pursuant to Rule 13d-3 under the Exchange Act),
        including pursuant to any agreement, arrangement or understanding, whether
        or
        not in writing.

      

      (c) “Common
        Stock”
        shall
        mean and include the Company’s authorized common stock, $0.0001 par value, as
        constituted on the issuance date of this Note, and shall also include any
        capital stock of any class of the Company thereafter authorized that shall
        neither be limited to a fixed sum or percentage of par value in respect of
        the
        rights of the holders thereof to participate in dividends nor entitled to
        a
        preference in the distribution of assets upon the voluntary or involuntary
        liquidation, dissolution or winding up of the Company; provided that the
        shares
        of Common Stock receivable upon conversion of this Note shall include only
        shares designated as Common Stock of the Company on the issuance date of
        this
        Note, or in case of any reorganization, reclassification, or stock split
        of the
        outstanding shares thereof, the stock, securities or assets provided for
        in
        Sections 3(f) and (g). Any capitalized terms used in this Note but not defined
        herein shall have the meanings set forth in the Purchase Agreement.

      

      (d) “Purchase
        Agreement
        shall
        mean the several agreements under which the Holders of the Notes have purchased
        the Notes from the Company on the date of Original Issuance.

      

      (e) “Senior
        Indebtedness”
        shall
        mean, as of any date as of which the amount thereof is to be determined,
        the
        principal of and premium, if any, and interest due on (i) any indebtedness
        

       

      
        
           

        

        
          -16-

          
            

          

        

        
           

        

      

       

      for
        money
        borrowed from banks, insurance companies or commercial finance companies
        that
        provide credit in the regular course of their business, whether outstanding
        on
        the date of this Note or thereafter created, incurred or assumed, except
        for any
        such indebtedness that by the terms of the instrument or instruments by which
        such indebtedness was created or incurred expressly provides that it (A)
        is
        subordinated in right of payment to the Notes or (B) ranks pari passu in
        right
        of payment with the Notes and (ii) any amendments, renewals, extensions,
        modifications and refundings of any such indebtedness.

      

      13. Loss,
        Theft, Destruction of Note.
        Upon
        receipt of evidence satisfactory to the Company of the loss, theft, destruction
        or mutilation of this Note and, in the case of any such loss, theft or
        destruction, upon receipt of indemnity reasonably satisfactory to the Company
        (which shall not include the posting of any bond), or, in the case of any
        such
        mutilation, upon surrender and cancellation of this Note, the Company shall
        make, issue and deliver, in lieu of such lost, stolen, destroyed or mutilated
        Note, one or more new Notes of like tenor. This Note shall be held and owned
        upon the express condition that the provisions of this Section 13 are exclusive
        with respect to the replacement of mutilated, destroyed, lost or stolen Notes
        and shall preclude any and all other rights and remedies notwithstanding
        any law
        or statute existing or hereafter enacted to the contrary with respect to
        the
        replacement of negotiable instruments or other securities without the surrender
        thereof.

      

      14. Record
        Owner.
        The
        Company may deem the person in whose name this Note shall be registered upon
        the
        registry books of the Company to be, and may treat such person as, the absolute
        owner of this Note for the purpose of conversion of this Note and for all
        other
        purposes, and the Company shall not be affected by any notice to the contrary.
        All such payments and such conversion shall be valid and effective to satisfy
        and discharge the liability upon this Note to the extent of the sum or sums
        so
        paid or the conversion so made.

      

      15. Injunctive
        Relief.
        The
        Company acknowledges that a breach by it of its obligations hereunder with
        respect to the conversion of the Notes will cause irreparable harm to the
        Holders of this Note and that the remedy at law for any such breach may be
        inadequate. The Company therefore agrees that, in the event of any such breach
        or threatened breach, the Holders of this Note shall be entitled, in addition
        to
        all other available remedies, to an injunction restraining any breach, without
        the necessity of showing economic loss and without any bond or other security
        being required.

      

      16. No
        Usury.
        All
        agreements between the Company and the Holder are hereby expressly limited
        so
        that in no contingency or event whatsoever, whether by reason of acceleration
        of
        maturity of the indebtedness or otherwise, shall the amount paid or agreed
        to be
        paid to the Holder hereof for the use, forbearance or detention of the
        indebtedness evidenced hereby exceed the maximum permissible amount paid
        or
        agreed to be paid to the Holder hereof under applicable law. If, for any
        circumstances whatsoever, fulfillment of any provision hereof, at the time
        performance of such provision shall be due, shall involve transcending the
        limit
        of validity prescribed by law, then ipso facto the obligation to be fulfilled
        shall be reduced to the limit of such validity, and if from any circumstance
        the
        Holder hereof should ever receive as interest an amount which would exceed
        the
        highest lawful rate, such amount which would be excessive interest shall
        be
        applied to the reduction of the principal amount. As used herein, the term
        “applicable law” shall mean the law in effect as of the date hereof, provided,
        however, that 

       

      
        
           

        

        
          -17-

          
            

          

        

        
           

        

      

       

      in
        the
        event there is a change in the law which results in a higher permissible
        rate of
        interest, then this Note shall be governed by such new law as of its effective
        date.

      

      17. Amendments.
        The
        terms of the outstanding Notes may be amended as to the Holder and its
        respective successors and assigns, and the Company may take any action herein
        prohibited, or omit to perform any act required to be performed by it, if
        the
        Company shall obtain the written consent of the registered holders of not
        less
        than 66-2/3% of the outstanding principal amount of the Notes. This Note
        may not
        be waived, changed, modified, or discharged orally, but only by an agreement
        in
        writing signed by the party or parties against whom enforcement of any waiver,
        change, modification or discharge is sought or by parties with the right
        to
        consent to such waiver, change, modification or discharge on behalf of such
        party.

      

      18. Failure
        or Indulgence Not Waiver.
        No
        failure or delay on the part of the Holder of this Note in the exercise of
        any
        power, right or privilege hereunder shall operate as a waiver thereof (except
        to
        the extent that such power, right or privilege must, in accordance with the
        terms of this Note, be exercised within a specified period of time and such
        period of time has lapsed without such power, right or privilege being
        exercised), 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.

      

      19. Governing
        Law.
        This
        Note
        shall be governed by and construed in accordance with the laws of the State
        of
        New York. Each of the parties consents to the jurisdiction of the United
        States
        District Court for the Eastern or Southern District of New York or the state
        courts of the State of New York located in New York County, New York in
        connection with any dispute arising under this Agreement and hereby waives,
        to
        the maximum extent permitted by law, any objection, including any objection
        based on forum non conveniens, to the bringing of any such proceeding in
        such
        jurisdictions.

      

      [SIGNATURE
        PAGE FOLLOWS]

      

      
        
           

        

        
          -18-

          
            

          

        

        
           

        

      

      IN
        WITNESS WHEREOF, the Company has caused this instrument to be duly executed
        by
        an officer thereunto duly authorized.

       

      
        	 	 	 
	 	
                CDKNET.COM,
                  INC.

              
	 
 	 
 	 
 
	Dated: 	By:  	 
	 	
                

                Name: Oleg Logvinov
	 	Title:
                Chief Executive Officer and President

      

      Attest:

      

      

      ______________________________

      Secretary

      
        
           

        

        
          -19-

          
            

          

        

        
           

        

      

      

      EXHIBIT
        A

      

      NOTICE
        OF CONVERSION

      (To
        be
        Executed by the Registered Holder in order to Convert the Note)

      

      The
        undersigned hereby irrevocably elects to convert $ ________________ of the
        principal amount of the above Note No. ___ into shares of Common Stock of
        CDKnet.com, Inc. (the “Company”) according to the conditions hereof, as of the
        date written below.

      

      Date
        of
        Conversion
        ____________________________________________________________

      

      Applicable
        Conversion Price
        ____________________________________________________

      

      Accrued
        Interest________________________________________________________________

      

      Number
        of
        shares to be
        issued:____________________________________________________

      

      Signature_____________________________________________________________________

      [Name]

      

      Address
        for delivery of shares or DTC account number for deposit of
        shares:______________________________________________________________________

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      
        
           

        

        
          -20-WWW.EXFILE.COM, INC. -- 13681 -- CDKNET.COM, INC. -- EXHIBIT 10.3 TO FORM 8-K

    

      EXHIBIT
        10.3

      

      NEITHER
        THIS WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED
        UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY OTHER
        APPLICABLE SECURITIES LAWS IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION
        REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER
        THIS
        WARRANT NOR THE SHARES ISSUABLE UPON EXERCISE HEREOF MAY BE SOLD, PLEDGED,
        TRANSFERRED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
        REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR IN A TRANSACTION THAT
        IS
        EXEMPT FROM REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT.

      

      STOCK
        PURCHASE WARRANT

      

      No.
        WTPA
        - ___

      

      To
        Purchase____________
        Shares
        of
        Common Stock of

      

      CDKNET.COM,
        INC.

      

      THIS
        CERTIFIES that, for value received, __________________
        (the
        “Holder”) is entitled, upon the terms and subject to the conditions hereinafter
        set forth, at any time prior to the close of business on July 7, 2010 (the
        “Termination Date”), but not thereafter, to subscribe for and purchase from
        CDKnet.com, Inc., a corporation incorporated in Delaware (the “Company”), up to
____________________________________
        (_________)
        shares
        (the “Warrant Shares”) of the common stock, $.0001 par value, of the Company
        (the “Common Stock”). The purchase price of one share of Common Stock (the
“Exercise Price”) under this Warrant shall be $0.35. The Exercise Price and the
        number of shares for which the Warrant is exercisable shall be subject to
        adjustment as provided herein. In the event of any conflict between the terms
        of
        this Warrant and the Securities Purchase Agreement, the Securities Purchase
        Agreement shall control. Capitalized terms used and not otherwise defined
        herein
        shall have the meanings set forth for such terms in the Securities Purchase
        Agreement. This Warrant is part of an authorized class of up to 342,864 Warrants
        of like tenor authorized by the Company pursuant to several Securities Purchase
        Agreements variously dated between the Company and the persons identified
        therein relating to the purchase and sale of Units, consisting of 6% Convertible
        Subordinated Notes and Warrants (the “Purchase Agreement”). Capitalized terms
        used without being identified herein shall have the meaning ascribed to such
        terms by the Purchase Agreement between the Company and the initial
        Holder.

      

      1. Title
        to Warrant.
        Prior
        to and subject to compliance with applicable laws, this Warrant and all rights
        hereunder are transferable, in whole or in part, at the office or agency
        of the
        Company by the Holder hereof in person or by duly authorized attorney, upon
        surrender of this Warrant together with the Assignment Form annexed hereto
        properly endorsed.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
 

      2. Authorization
        of Shares.
        The
        Company covenants that all shares of Common Stock that may be issued upon
        the
        exercise of rights represented by this Warrant will, upon exercise of the
        rights
        represented by this Warrant, be duly authorized, validly issued, fully-paid
        and
        nonassessable and free from all taxes, liens and charges in respect of the
        issue
        thereof (other than taxes in respect of any transfer occurring contemporaneously
        with such issue).

      

      3. Exercise
        of Warrant.
         Except
        as
        otherwise expressly provided herein, exercise of the purchase rights represented
        by this Warrant may be made at any time or times on or before the close of
        business on the Termination Date by the surrender of this Warrant and the
        Notice
        of Exercise form annexed hereto duly executed, at the office of the Company
        (or
        such other office or agency of the Company as it may designate by notice
        in
        writing to the registered Holder hereof at the address of such Holder appearing
        on the books of the Company), and upon payment of the Exercise Price of the
        Warrant Shares thereby purchased by wire transfer or certified check, cashier’s
        check or money order drawn on a United States bank. The Holder of this Warrant
        shall be entitled to receive a certificate for the number of shares of Common
        Stock so purchased. If a registration statement for the resale of the shares
        of
        Common Stock issuable upon exercise of this Warrant has not been declared
        effective by the Securities and Exchange Commission by the first anniversary
        of
        the first closing of the offering contemplated by the Purchase Agreement
        (and
        provided further that (a) such registration statement shall also have been
        kept
        current for at least one year after the effective date thereof and (b) the
        Holder of the Warrant shall be entitled to the benefits of indemnification
        and
        contribution provisions of the Purchase Agreement with respect to such
        registration statement, this Warrant may also be exercised in whole or in
        part
        by means of a “cashless exercise” by means of tendering this Warrant to the
        Company together with a written demand to receive the number of shares of
        Common
        Stock equal in total Market Value (as hereinafter defined) to the difference
        between the total Market Value of the shares of Common Stock issuable upon
        such
        exercise of this Warrant (to the extent exercised) and the total cash Exercise
        Price of that part of the Warrant being exercised. “Market Value” for this
        purpose shall be the price for the last trade of the Common Stock as reported
        by
        Bloomberg L.P. on the close of business on the last Trading Day (as such
        term is
        defined in the Note issued pursuant to the Purchase Agreement) preceding
        the
        tender of the original documentation for such cashless exercise. Certificates
        for shares purchased hereunder shall be delivered to the Holder hereof within
        seven (7) Trading Days after the date on which this Warrant shall have been
        exercised as aforesaid. This Warrant shall be deemed to have been exercised
        and
        such certificate or certificates shall be deemed to have been issued, and
        Holder
        or any other person so designated to be named therein shall be deemed to
        have
        become a holder of record of such shares for all purposes, as of the date
        the
        Warrant has been exercised by payment to the Company of the Exercise Price
        (or
        in the case of a cashless exercise, the date the original documents for such
        cashless exercise have been received by the Company). If this Warrant shall
        have
        been exercised in part, the Company shall, at the time of delivery of the
        certificate or certificates representing Warrant Shares, deliver to Holder
        a new
        Warrant evidencing the rights of Holder to purchase the unpurchased shares
        of
        Common Stock called for by this Warrant; which new Warrant shall in all other
        respects be identical with this Warrant.

      

      The
        Holder is granted the piggy back registration rights set forth in the Purchase
        Agreement, provided such rights may only be assigned in the manner described
        in
        the Securities Purchase Agreement.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      
 

      4. No
        Fractional Shares or Scrip.
        No
        fractional shares or scrip representing fractional shares shall be issued
        upon
        the exercise of this Warrant. As to any fraction of a share that Holder would
        otherwise be entitled to purchase upon such exercise, the Company shall cause
        the Transfer Agent to issue one whole share of Common Stock in respect of
        such
        fraction of a share of Common Stock.

      

      5. Charges,
        Taxes and Expenses.
        Issuance of certificates for shares of Common Stock upon the exercise of
        this
        Warrant shall be made without charge to the Holder hereof for any issue or
        transfer tax or other incidental expense in respect of the issuance of such
        certificate, all of which taxes and expenses shall be paid by the Company,
        and
        such certificates shall be issued in the name of the Holder of this Warrant
        or
        in such name or names as may be directed by the Holder of this Warrant;
        provided, however, that in the event certificates for shares of Common Stock
        are
        to be issued in a name other than the name of the Holder of this Warrant,
        this
        Warrant when surrendered for exercise shall be accompanied by the Assignment
        Form attached hereto duly executed by the Holder hereof; and the Company
        may
        require, as a condition thereto, the payment of a sum sufficient to reimburse
        it
        for any transfer tax incidental thereto.

      

      6. Closing
        of Books.
        The
        Company will not close its shareholder books or records in any manner that
        prevents the timely exercise of this Warrant.

      

      7. Transfer,
        Division and Combination.
        (a)
        Subject to compliance with any applicable securities laws, transfer of this
        Warrant and all rights hereunder, in whole or in part, shall be registered
        on
        the books of the Company to be maintained for such purpose, upon surrender
        of
        this Warrant at the principal office of the Company, together with a written
        assignment of this Warrant substantially in the form attached hereto duly
        executed by Holder or its agent or attorney, and payment of funds sufficient
        to
        pay any transfer taxes payable upon the making of such transfer. Upon such
        surrender and, if required, such payment, the Company shall execute and deliver
        a new Warrant or Warrants in the name of the assignee or assignees and in
        the
        denomination or denominations specified in such instrument of assignment,
        and
        shall issue to the assignor a new Warrant evidencing the portion of this
        Warrant
        not so assigned, and this Warrant shall promptly be cancelled. A Warrant,
        if
        properly assigned, may be exercised by a new Holder for the purchase of shares
        of Common Stock without having a new Warrant issued.

      

      (b) This
        Warrant may be divided or combined with other Warrants upon presentation
        hereof
        at the aforesaid office of the Company, together with a written notice
        specifying the names and denominations in which new Warrants are to be issued,
        signed by Holder or its agent or attorney. Subject to compliance with Section
        7(a), as to any transfer that may be involved in such division or combination,
        the Company shall execute and deliver a new Warrant or Warrants in exchange
        for
        the Warrant or Warrants to be divided or combined in accordance with such
        notice.

      

      (c) The
        Company shall prepare, issue and deliver at its own expense (other than transfer
        taxes) the new Warrant or Warrants under this Section 7.

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      
 

      (d) The
        Company agrees to maintain, at its aforesaid office, books for the registration
        and the registration of transfer of the Warrants.

      

      8. No
        Rights as Shareholder until Exercise.
        This
        Warrant does not entitle the Holder hereof to any voting rights or other
        rights
        as a shareholder of the Company prior to the exercise hereof. Upon the surrender
        of this Warrant and the payment of the aggregate Exercise Price as contemplated
        by Section 3, the Warrant Shares so purchased shall be and be deemed to be
        issued to such Holder as the record owner of such shares as of the close
        of
        business on the later of the date of such surrender or payment. 

      

      9. Loss,
        Theft, Destruction or Mutilation of Warrant.
        The
        Company covenants that upon receipt by the Company of evidence reasonably
        satisfactory to it of the loss, theft, destruction or mutilation of this
        Warrant
        certificate or any stock certificate relating to the Warrant Shares, and
        in case
        of loss, theft or destruction, of indemnity or security reasonably satisfactory
        to it (which shall not include the posting of any bond), and upon surrender
        and
        cancellation of such Warrant or stock certificate, if mutilated, the Company
        will make and deliver a new Warrant or stock certificate of like tenor and
        dated
        as of such cancellation, in lieu of such Warrant or stock
        certificate.

      

      10. Saturdays,
        Sundays, Holidays, etc.
        If the
        last or appointed day for the taking of any action or the expiration of any
        right required or granted herein shall be a Saturday, Sunday or a legal holiday,
        then such action may be taken or such right may be exercised on the next
        succeeding day not a Saturday, Sunday or legal holiday.

      

      11. Adjustments
        of Exercise Price and Number of Warrant Shares.

      

      The
        number and kind of securities purchasable upon the exercise of this Warrant
        and
        the Exercise Price shall be subject to adjustment from time to time upon
        the
        happening of any of the following. 

      

      (a) Reorganization,
        Reclassification, Merger, Consolidation or Disposition of Assets.
        In case
        the Company shall reorganize its capital, reclassify its capital stock,
        consolidate or merge with or into another corporation (where the Company
        is not
        the surviving corporation or where there is a change in or distribution with
        respect to the Common Stock of the Company), or sell, transfer or otherwise
        dispose of all or substantially all its property, assets or business to another
        corporation and, pursuant to the terms of such reorganization, reclassification,
        merger, consolidation or disposition of assets, shares of common stock of
        the
        successor or acquiring corporation, or any cash, shares of stock or other
        securities or property of any nature whatsoever (including warrants or other
        subscription or purchase rights) in addition to or in lieu of common stock
        of
        the successor or acquiring corporation (“Other Property”), are to be received by
        or distributed to the holders of Common Stock of the Company, then Holder
        shall
        have the right thereafter to receive, upon exercise of this Warrant, the
        number
        of shares of common stock of the successor or acquiring corporation or of
        the
        Company, if it is the surviving corporation, and Other Property receivable
        upon
        or as a result of such reorganization, reclassification, merger, consolidation
        or disposition of assets by a holder of the number of shares of Common Stock
        for
        which this Warrant is exercisable immediately prior to 

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

       

      such
        event. In case of any such reorganization, reclassification, merger,
        consolidation or disposition of assets, the successor or acquiring corporation
        (if other than the Company) shall expressly assume the due and punctual
        observance and performance of each and every covenant and condition of this
        Warrant to be performed and observed by the Company and all the obligations
        and
        liabilities hereunder, subject to such modifications as may be deemed
        appropriate (as determined in good faith by resolution of the Board of Directors
        of the Company) in order to provide for adjustments of shares of Common Stock
        for which this Warrant is exercisable which shall be as nearly equivalent
        as
        practicable to the adjustments provided for in this Section 11. For purposes
        of
        this Section 11, “common stock of the successor or acquiring corporation” shall
        include stock of such corporation of any class which is not preferred as
        to
        dividends or assets over any other class of stock of such corporation and
        which
        is not subject to redemption and shall also include any evidences of
        indebtedness, shares of stock or other securities which are convertible into
        or
        exchangeable for any such stock, either immediately or upon the arrival of
        a
        specified date or the happening of a specified event and any warrants or
        other
        rights to subscribe for or purchase any such stock. The foregoing provisions
        of
        this Section 11 shall similarly apply to successive reorganizations,
        reclassifications, mergers, consolidations or disposition of
        assets.

      

      12. Voluntary
        Adjustment by the Company.
        The
        Company may at any time during the term of this Warrant, reduce the then
        current
        Exercise Price to any amount and for any period of time deemed appropriate
        by
        the Board of Directors of the Company, except to the extent such action would
        delay or impair the Holder’s right to publicly resell the Warrant Shares
        pursuant to Rule 144 promulgated under the Securities Act or
        otherwise.

      

      13. Notice
        of Adjustment.
        Whenever the number of Warrant Shares or number or kind of securities or
        other
        property purchasable upon the exercise of this Warrant or the Exercise Price
        is
        adjusted, as herein provided, the Company shall promptly mail by registered
        or
        certified mail, return receipt requested, to the Holder of this Warrant notice
        of such adjustment or adjustments setting forth the number of Warrant Shares
        (and other securities or property) purchasable upon the exercise of this
        Warrant
        and the Exercise Price of such Warrant Shares (and other securities or property)
        after such adjustment, setting forth a brief statement of the facts requiring
        such adjustment and setting forth the computation by which such adjustment
        was
        made. Such notice, in the absence of manifest error, shall be conclusive
        evidence of the correctness of such adjustment.

      

      14. Notice
        of Corporate Action.
        If at
        any time:

      

      (i) the
        Company shall take a record of the holders of its Common Stock for the purpose
        of entitling them to receive a dividend or other distribution, or any right
        to
        subscribe for or purchase any evidences of its indebtedness, any shares of
        stock
        of any class or any other securities or property, or to receive any other
        right,
        or

      

      (ii) there
        shall be any capital reorganization of the Company, any reclassification
        or
        recapitalization of the capital stock of the Company or any consolidation
        or
        merger of the Company with, or any sale, transfer or other disposition of
        all or
        substantially all the property, assets or business of the Company to, another
        corporation or,

      

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

       

      (iii) there
        shall be a voluntary or involuntary dissolution, liquidation or winding up
        of
        the Company; then,
        in
        any one or more of such cases, the Company shall give to Holder (i) at least
        10
        days’ prior written notice of the date on which a record date shall be selected
        for such dividend, distribution or right or for determining rights to vote
        in
        respect of any such reorganization, reclassification, merger, consolidation,
        sale, transfer, disposition, liquidation or winding up, and (ii) in the case
        of
        any such reorganization, reclassification, merger, consolidation, sale,
        transfer, disposition, dissolution, liquidation or winding up, at least 10
        days’
        prior written notice of the date when the same shall take place. Such notice
        in
        accordance with the foregoing clause also shall specify (i) the date on which
        any such record is to be taken for the purpose of such dividend, distribution
        or
        right, the date on which the holders of Common Stock shall be entitled to
        any
        such dividend, distribution or right, and the amount and character thereof,
        and
        (ii) the date on which any such reorganization, reclassification, merger,
        consolidation, sale, transfer, disposition, dissolution, liquidation or winding
        up is to take place and the time, if any such time is to be fixed, as of
        which
        the holders of Common Stock shall be entitled to exchange their shares of
        Common
        Stock for securities or other property deliverable upon such disposition,
        dissolution, liquidation or winding up. Each such written notice shall be
        sufficiently given if addressed to Holder at the last address of Holder
        appearing on the books of the Company and delivered in accordance with Section
        16(d).

      

      15. Authorized
        Shares.
        

      

      (a) The
        Company covenants that during the period the Warrant is outstanding, it will
        reserve from its authorized and unissued Common Stock a sufficient number
        of
        shares to provide for the issuance of the Warrant Shares upon the exercise
        of
        any purchase rights under this Warrant. The Company further covenants that
        its
        issuance of this Warrant shall constitute full authority to its officers
        who are
        charged with the duty of executing stock certificates to execute and issue
        the
        necessary certificates for the Warrant Shares upon the exercise of the purchase
        rights under this Warrant. The Company will take all such reasonable action
        as
        may be necessary to assure that such Warrant Shares may be issued as provided
        herein without violation of any applicable law or regulation, or of any
        requirements of the Principal Market upon which the Common Stock may be listed.
        

      

      (b) The
        Company shall not by any action, including, without limitation, amending
        its
        certificate of incorporation or through any reorganization, transfer of assets,
        consolidation, merger, dissolution, issue or sale of securities or any other
        voluntary action, avoid or seek to avoid the observance or performance of
        any of
        the terms of this Warrant, but will at all times in good faith assist in
        the
        carrying out of all such terms and in the taking of all such actions as may
        be
        necessary or appropriate to protect the rights of Holder against impairment.
        Without limiting the generality of the foregoing, the Company will (i) not
        increase the par value of any shares of Common Stock receivable upon the
        exercise of this Warrant above the amount payable therefor upon such exercise
        immediately prior to such increase in par value, (ii) take all such action
        as
        may be necessary or appropriate in order that the Company may validly and
        legally issue fully paid and nonassessable shares of Common Stock upon the
        exercise of this Warrant, and (iii) use its best efforts to obtain all such
        authorizations, exemptions or 

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      consents
        from any public regulatory body having jurisdiction thereof as may be necessary
        to enable the Company to perform its obligations under this
        Warrant.

       

      (c) Upon
        the
        request of Holder, the Company will at any time during the period this Warrant
        is outstanding acknowledge in writing, in form reasonably satisfactory to
        Holder, the continuing validity of this Warrant and the obligations of the
        Company hereunder.

      

      (d) Before
        taking any action pursuant to Section 11 or 12 that would cause an adjustment
        reducing the current Exercise Price below the then par value, if any, of
        the
        shares of Common Stock issuable upon exercise of the Warrants, the Company
        shall
        take any corporate action that may be necessary in order that the Company
        may
        validly and legally issue fully- paid and nonassessable shares of such Common
        Stock at such adjusted Exercise Price.

      

      (e) Before
        taking any action that would result in an adjustment in the Exercise Price,
        the
        Company shall obtain all such authorizations or exemptions thereof, or consents
        thereto, as may be necessary from any public regulatory body or bodies having
        jurisdiction thereof.

      

      16. Miscellaneous.

      

      (a) Jurisdiction.
        This
        Warrant shall be binding upon any successors or assigns of the Company. This
        Warrant shall constitute a contract under the laws of the State of Delaware
        without regard to its conflict of law principles or rules.

      

      (b) Restrictions.
        The
        Holder hereof acknowledges that the Warrant Shares acquired upon the exercise
        of
        this Warrant, if not registered or exempt from registration, will have
        restrictions upon resale imposed by state and Federal securities
        laws.

      

      (c) Nonwaiver
        and Expenses.
        No
        course of dealing or any delay or failure to exercise any right hereunder
        on the
        part of Holder shall operate as a waiver of such right or otherwise prejudice
        Holder’s rights, powers or remedies; notwithstanding which all rights hereunder
        terminate on the Termination Date. If the Company fails to comply with any
        provision of this Warrant, the Company shall pay to Holder such amounts as
        shall
        be sufficient to cover any costs and expenses including, but not limited
        to,
        reasonable attorneys’ fees, including those of appellate proceedings, incurred
        by Holder in collecting any amounts due pursuant hereto or in otherwise
        enforcing any of its rights, powers or remedies hereunder. The foregoing
        shall
        not contribute a limitation on the rights of the Holder in the event of the
        Company’s breach or default of its obligations hereunder.

      

      (d) Notices.
        Any
        notice, request or other document required or permitted to be given or delivered
        to the Holder hereof by the Company shall be delivered in accordance with
        the
        notice provisions of the Purchase Agreement.

      

      (e) Limitation
        of Liability.
        No
        provision hereof, in the absence of affirmative action by Holder to purchase
        shares of Common Stock, and no enumeration herein of the rights or privileges
        of
        Holder hereof, shall give rise to any liability of Holder for the purchase
        

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

       

      price
        of
        any Common Stock or as a stockholder of the Company, whether such liability
        is
        asserted by the Company or by creditors of the Company.

      

      (f) Remedies.
        Holder,
        in addition to being entitled to exercise all rights granted by law, including
        recovery of damages, will be entitled to specific performance of its rights
        under this Warrant. The Company agrees that monetary damages would not be
        adequate compensation for any loss incurred by reason of a breach by it of
        the
        provisions of this Warrant and hereby agrees to waive the defense in any
        action
        for specific performance that a remedy at law would be adequate.

      

      (g) Successors
        and Assigns.
        Subject
        to applicable securities laws, this Warrant and the rights and obligations
        evidenced hereby shall inure to the benefit of and be binding upon the
        successors of the Company and the successors and permitted assigns of Holder.
        The provisions of this Warrant are intended to be for the benefit of all
        Holders
        from time to time of this Warrant and shall be enforceable by any such Holder
        or
        holder of Warrant Shares.

      

      (h) Indemnification.
        The
        Company agrees to indemnify and hold harmless Holder from and against any
        liabilities, obligations, losses, damages, penalties, actions, judgments,
        suits,
        claims, costs, attorneys’ fees, expenses and disbursements of any kind that may
        be imposed upon, incurred by or asserted against Holder in any manner relating
        to or arising out of any failure by the Company to perform or observe in
        any
        material respect any of its covenants, agreements, undertakings or obligations
        set forth in this Warrant; provided,
        however,
        that
        the Company will not be liable hereunder to the extent that any liabilities,
        obligations, losses, damages, penalties, actions, judgments, suits, claims,
        costs, attorneys’ fees, expenses or disbursements are found in a final
        non-appealable judgment by a court to have resulted from Holder’s negligence,
        bad faith or willful misconduct in its capacity as a stockholder or
        warrantholder of the Company.

      

      (i) Severability.
        Wherever possible, each provision of this Warrant shall be interpreted in
        such
        manner as to be effective and valid under applicable law, but if any provision
        of this Warrant 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 provisions or the remaining
        provisions of this Warrant.

      

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      (j) Headings.
        The
        headings used in this Warrant are for the convenience of reference only and
        shall not, for any purpose, be deemed a part of this Warrant.

      

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

      

      Dated:
        ___________, 2005

       

      
        	 	 	 
	 	
                CDKNET.COM,
                  INC.

              
	 
 	 
 	 
 
	 	By:  	 
	 	
                
Name:

	 	Title: 

      

      
 

      

      ATTEST:

      

      

      __________________________

      Secretary

       

       

      

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      

      NOTICE
        OF
        EXERCISE

      

      

      

      To: CDKnet.com,
        Inc.

      

      (1) The
        undersigned hereby elects to purchase ________ shares of Common Stock (the
        “Common Stock”) of CDKnet.com, Inc., pursuant to the terms of the attached
        Warrant, and [ ] tenders herewith payment of the exercise price in full OR
        [ ]
        tenders the Warrant for cashless exercise, together with all applicable transfer
        taxes, if any.

      

      (2) Calculation
        of cashless exercise value, if
        applicable:_________________________________________________________________________

       

      ___________________________________________________________________________________________________________________________.

      

      (3) Please
        issue a certificate or certificates representing said shares of Common Stock
        in
        the name of the undersigned or in such other name as is specified
        below:

      

      _______________________________

      (Name)

      

      _______________________________

      (Address)

      

      _______________________________

      

      

      Dated:

      

      

      ______________________________

      Signature

      

      

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

       

      

      

      ASSIGNMENT
        FORM

      

      (To
        assign the foregoing Warrant, execute

      this
        form
        and supply required information. 

      Do
        not
        use this form to exercise the Warrant.)

      

      

      

      FOR
        VALUE
        RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby
        assigned to

      

      _______________________________________________
        whose address is

      

      _______________________________________________________________.

      

      _______________________________________________________________

      

      Dated:
        ______________, _______

      

      

      Holder's
        Signature: _____________________________

      

      Holder's
        Address: _____________________________

       _____________________________

      

      

      Signature
        Guaranteed: ___________________________________________

      

      

      NOTE:
        The
        signature to this Assignment Form must correspond with the name as it appears
        on
        the face of the Warrant, without alteration or enlargement or any change
        whatsoever, and must be guaranteed by a bank or trust company. Officers of
        corporations and those acting in a fiduciary or other representative capacity
        should file proper evidence of authority to assign the foregoing
        Warrant.

      

      ASSIGNMENT
        OF THIS WARRANT AND RELATED RIGHTS MAY ONLY BE MADE IN COMPLIANCE WITH
        APPLICABLE LAW AND THE TERMS OF THE SECURITIES PURCHASE AGREEMENT PURSUANT
        TO
        WHICH THIS WARRANT WAS ISSUED. ANY TRANSFER IN VIOLATION THEREOF SHALL BE
        VOID
        NOT BINDING UPON THE COMPANY.

       

       

      
        
           

        

        
          11

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