Document:

Exhibit
      4.6

    

    21ST
      CENTURY HOLDING COMPANY

    3661
      WEST
      OAKLAND PARK BOULEVARD

    LAUDERDALE
      LAKES, FL 33311

    

    UNIT
      PURCHASE AGREEMENT

    

    TO
      THE
      PURCHASERS LISTED IN

    THE
      ATTACHED SCHEDULE A:

    

    Ladies
      and Gentlemen:

    

    21st
      Century Holding Company, a Florida corporation (the "Company"), agrees with
      the
      Purchasers listed in the attached Schedule A (the "Purchasers") to this Unit
      Purchase Agreement (this "Agreement") as follows:

    

    SECTION
      1. CERTAIN DEFINITIONS.

    

    As
      used
      herein, the following terms have the respective meanings set forth below or
      set
      forth in the Section hereof following such term:

    

    "Affiliate"
      means, at any time, and with respect to any Person, (a) any other Person that
      at
      such time directly or indirectly through one or more intermediaries Controls,
      or
      is Controlled by, or is under common Control with, such first Person, and (b)
      any Person beneficially owning or holding, directly or indirectly, 10% or more
      of any class of equity interests of the Company or any Subsidiary or any
      corporation of which the Company and its Subsidiaries beneficially own or hold,
      in the aggregate, directly or indirectly, 10% or more of any class of equity
      interests. As used in this definition, "Control" means the possession, directly
      or indirectly, of the power to direct or cause the direction of the management
      and policies of a Person, whether through the ownership of voting securities,
      by
      contract or otherwise.

    

    "Business
      Day" means any day other than a Saturday, a Sunday or a day on which the Nasdaq
      National Market ("Nasdaq") is required or authorized to be closed.

    

    "Capital
      Lease" means, at any time, a lease with respect to which the lessee is required
      concurrently to recognize the acquisition of an asset and the incurrence of
      a
      liability in accordance with GAAP.

    

    "Capital
      Lease Obligation" means, with respect to any Person and a Capital Lease, the
      amount of the obligation of such Person as the lessee under such Capital Lease
      which would, in accordance with GAAP, appear as a liability on a balance sheet
      of such Person.

    

    "Change
      of Control" is defined in Section 7.2(h).

    

    "Code"
      means the Internal Revenue Code of 1986, as amended from time to time, and
      the
      rules and regulations promulgated thereunder from time to time. 

    

    
      
        
        

      

      
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    "Confidential
      Information" is defined in Section 20.

    

    "Default"
      means an event or condition the occurrence or existence of which would, with
      the
      lapse of time or the giving of notice or both, become an Event of
      Default.

    

    "Eligible
      Subsidiary" means each of the Company's Subsidiaries, except such Subsidiaries
      which are regulated by the Florida Department of Financial Service or successor
      entity.

    

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

    

    "Fair
      Market Value" means, at any time and with respect to any property, the sale
      value of such property that would be realized in an arm's-length sale at such
      time between an informed and willing buyer and an informed and willing seller
      (neither being under a compulsion to buy or sell), as reasonably determined
      in
      the good faith opinion of the Company's board of directors.

    

    "GAAP"
      means generally accepted accounting principles as in effect from time to time
      in
      the United States of America.

    

    "Guarantor"
      shall mean those certain Eligible Subsidiaries of the Company which shall be
      a
      party to a Subsidiary Guarantee.

    

    "Guaranty"
      means, with respect to any Person, any obligation (except the endorsement in
      the
      ordinary course of business of negotiable instruments for deposit or collection)
      of such Person guaranteeing or in effect guaranteeing any Indebtedness, dividend
      or other obligation of any other Person in any manner, whether directly or
      indirectly, including (without limitation) obligations incurred through an
      agreement, contingent or otherwise, by such Person: (a) to purchase such
      Indebtedness or obligation or any property constituting security therefor
      primarily for the purpose of assuring the owner of such Indebtedness or
      obligation of the ability of any other Person to make payment of the
      Indebtedness or obligation; (b) to advance or supply funds (i) for the purchase
      or payment of such Indebtedness or obligation, or (ii) to maintain any working
      capital or other balance sheet condition or any income statement condition
      of
      any other Person or otherwise to advance or make available funds for the
      purchase or payment of such Indebtedness or obligation; (c) to lease properties
      or to purchase properties or services primarily for the purpose of assuring
      the
      owner of such Indebtedness or obligation of the ability of any other Person
      to
      make payment of the Indebtedness or obligation; or (d) otherwise to assure
      the
      owner of such Indebtedness or obligation against loss in respect
      thereof.

    

    In
      any
      computation of the Indebtedness or other liabilities of the obligor under any
      Guaranty, the Indebtedness or other obligations that are the subject of such
      Guaranty shall be assumed to be direct obligations of such obligor, provided
      that the amount of such Indebtedness outstanding for purposes of this Agreement
      shall not be exceed the maximum amount of Indebtedness that is the subject
      of
      such Guaranty.

    

    "Holder"
      means, with respect to any Note, the Person in whose name such Note is
      registered in the register maintained by the Company pursuant to Section
      14.1.

    
 

    
      
        
          
          

        

        
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    "Indebtedness"
      means, with respect to any Person, without duplication, (a) all liabilities
      of
      such Person for borrowed money (including overdrafts) or for the deferred
      purchase price of property or services, excluding any trade payables and other
      accrued current liabilities incurred in the ordinary course of business, but
      including, without limitation, all obligations, contingent or otherwise, of
      such
      Person in connection with any letters of credit and acceptances issued under
      letter of credit facilities, acceptance facilities or other similar facilities,
      (b) all obligations of such Person evidenced by bonds, notes, debentures or
      other similar instruments, (c) all indebtedness of such Person created or
      arising under any conditional sale or other title retention agreement with
      respect to property acquired by such Person (even if the rights and remedies
      of
      the seller or lender under such agreement in the event of default are limited
      to
      repossession or sale of such property), but excluding trade payables arising
      in
      the ordinary course of business, (d) all Capitalized Lease Obligations of such
      Person, (e) all Indebtedness referred to in (but not excluded from) the
      preceding clauses of other Persons and all dividends of other Persons, the
      payment of which is secured by (or for which the holder of such Indebtedness
      has
      an existing right, contingent or otherwise, to be secured by) any Lien upon
      or
      with respect to property (including, without limitation, accounts and contract
      rights) owned by such Person, even though such Person has not assumed or become
      liable for the payment of such Indebtedness (the amount of such obligation
      being
      deemed to be the lesser of the Fair Market Value of such property or asset
      or
      the amount of the obligation so secured), and (f) all guarantees by such Person
      of Indebtedness referred to in this definition of any other Person.

    

    "Interest
      Shares" is defined in Section 9.

    

    "Investments"
      shall mean all investments, in cash or by delivery of property made, directly
      or
      indirectly in any Person, whether by acquisition of shares of capital stock,
      indebtedness or other obligations or securities or by loan, advance, capital
      contribution or otherwise.

    

    "Lien"
      means, with respect to any Person, any mortgage, lien, pledge, charge, security
      interest or other encumbrance, or any interest or title of any vendor, lessor,
      lender or other secured party to or of such Person under any conditional sale
      or
      other title retention agreement or Capital Lease, upon or with respect to any
      property or asset of such Person.

    

    "Material"
      means material in relation to the business, operations, affairs, financial
      condition, assets or properties of the Company and its Subsidiaries taken as
      a
      whole.

    

    "Material
      Adverse Effect" means a material adverse effect on (a) the business, operations,
      affairs, financial condition, assets or properties of the Company and its
      Subsidiaries taken as a whole, or (b) the ability of the Company to perform
      its
      obligations under this Agreement, the Notes and the Warrants, or (c) the
      validity or enforceability of this Agreement, the Notes or the
      Warrants.

    

    "Notes"
      is defined in Section 2.

    

    "Offering
      Document" is defined in Section 6.3.

    

    "Permitted
      Indebtedness" means any of the following:

    
 

    
      
        
          
          

        

        
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    (a)
      Indebtedness of the Company or its Subsidiary outstanding as of the date
      hereof;

    

    (b)
      Indebtedness of the Company pursuant to the Notes issued at Closing or of any
      Subsidiary pursuant to the Subsidiary Guarantee, and any additional indebtedness
      in an aggregate amount (including the issuing of the Notes) which does not
      exceed $15 million at any one time outstanding represented by additional senior
      subordinated notes issued on a pari passu basis with the Notes and guaranteed
      by
      guarantees of one or more of the Subsidiaries on a pari passu basis with the
      Subsidiary Guarantee.

    

    (c)
      Indebtedness of the Company owing to any Subsidiary; provided that any
      Indebtedness of the Company owing to any such Subsidiary is unsecured and is
      subordinated in right of payment from and after such time as the Notes shall
      become due and payable to the payment and performance of the Company's
      obligations under the Notes; provided further that any disposition, pledge
      or
      transfer of any such Indebtedness to a Person (other than a disposition, pledge
      or transfer to the Company or another Subsidiary) shall be deemed to be an
      incurrence of such Indebtedness by the Company not permitted by this clause
      (c);

    

    (d)
      Indebtedness of a Subsidiary owing to the Company or to another Subsidiary;
      provided that any such Indebtedness of any Subsidiary is subordinated in right
      of payment to the Guaranty of such Subsidiary; provided further that any
      disposition, pledge or transfer of any such Indebtedness to a Person (other
      than
      a disposition, pledge or transfer to the Company or a Subsidiary) shall be
      deemed to be an incurrence of such Indebtedness by such Subsidiary not permitted
      by this clause (d);

    

    (e)
      Indebtedness of the Company or any Subsidiary in respect of purchase money
      obligations, Capitalized Lease Obligations of the Company or any Subsidiary
      and
      Subordinated Indebtedness of the Company or any Subsidiary in an aggregate
      amount which does not exceed $5 million at any one time
      outstanding;

    

    (f)
      Indebtedness of the Company or any Subsidiary consisting of guarantees,
      indemnities or obligations in respect of purchase price adjustments in
      connection with the acquisition or disposition of assets, including, without
      limitation, shares of capital stock of Subsidiaries;

    

    (g)
      Indebtedness of the Company or any Subsidiary represented by (x) letters of
      credit for the account of the Company or any Subsidiary or (y) other obligations
      to reimburse third parties pursuant to any surety bond or other similar
      arrangements, which letters of credit or other obligations, as the case may
      be,
      are intended to provide security for workers' compensation claims, payment
      obligations in connection with self-insurance or other similar requirements
      in
      the ordinary course of business;

    

    (h)
      Any
      renewals, extensions, substitutions, refinancings or replacements (each, for
      purposes of this clause, a "refinancing") of any Indebtedness, referred to
      herein, including any successive refinancings, so long as (i) any such new
      Indebtedness shall be in a principal amount that does not exceed the principal
      amount (or, if such Indebtedness being refinanced provides for an amount less
      than the principal amount thereof to be due and payable upon a declaration
      of
      acceleration thereof, such lesser amount as of the date of determination) so
      refinanced, plus the lesser of the amount of any premium required to be paid
      in
      connection with such refinancing pursuant to the terms of the Indebtedness
      refinanced or the amount of any premium reasonably determined as necessary
      to
      accomplish such refinancing, (ii) in the case of any refinancing by the Company
      of Subordinated Indebtedness, such new Indebtedness is made pari passu with
      or
      subordinate to the Notes at least to the same extent as the Indebtedness being
      refinanced, and (iii) in the case of any refinancing by any Subsidiary of
      Subordinated Indebtedness, such new Indebtedness is made pari passu with or
      subordinate to the Guaranty of such Guarantor at least to the same extent as
      the
      Indebtedness being refinanced; and

    

    
      
        
        

      

      
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    (i)
      Indebtedness of the Company not otherwise permitted herein incurred in
      connection with a merger, acquisition, sales of assets or similar business
      combinations, with the consent of the Holders of 50% of the principal amount
      of
      Notes then outstanding.

    

    "Person"
      means an individual, partnership, corporation, limited liability company,
      association, trust, unincorporated organization, or a government or agency
      or
      political subdivision thereof.

    

    "Prepayment
      Shares" is defined in Section 7.2(d)

    

    "Principal
      Shares" is defined in Section 7.1.

    

    "Property"
      or "properties" means, unless otherwise specifically limited, real or personal
      property of any kind, tangible or intangible, choate or inchoate.

    

    "Purchasers"
      means the purchasers of the Units named in Schedule A hereto.

    

    "Required
      Holders" means, at any time, the holders of at least 51% in principal amount
      of
      the Notes at the time outstanding (exclusive of Notes then owned by the Company
      or any of its Affiliates).

    

    "Responsible
      Officer" means any officer of the Company with responsibility for the
      administration of the relevant portion of this Agreement.

    

    "Sale
      and
      Leaseback Transaction" means any transaction or series of related transactions
      pursuant to which the Company or a Subsidiary sells or transfers any property
      or
      asset in connection with the leasing of such property or asset to the seller
      or
      transferor.

    

    "SEC"
      means the Securities and Exchange Commission.

    

    "Securities
      Act" means the Securities Act of 1933, as amended from time to
      time.

    

    "Senior
      Indebtedness" means the principal of, premium, if any, and interest on all
      other
      Indebtedness of the Company (other than the Notes), whether outstanding on
      the
      date of Closing or thereafter created, incurred or assumed, unless, in the
      case
      of any particular Indebtedness, the instrument creating or evidencing the same
      or pursuant to which the same is outstanding expressly provides that such
      Indebtedness shall not be senior in right of payment to the Notes.
      Notwithstanding the foregoing, "Senior Indebtedness" shall not include (i)
      Indebtedness evidenced by the Notes, (ii) Indebtedness of the Company that
      is
      expressly subordinated in right of payment to any Senior Indebtedness of the
      Company or the Notes, (iii) Indebtedness of the Company that by operation of
      law
      is subordinate to any general unsecured obligations of the Company, (iv)
      Indebtedness of the Company to the extent incurred in violation of any covenant
      of this Agreement, (v) any liability for federal, state or local taxes or other
      taxes, owed or owing by the Company, (vi) Indebtedness for goods, materials
      or
      services purchased in the ordinary course of business or Indebtedness consisting
      of trade account payables or other current liabilities (other than the current
      portion of long-term Indebtedness which would constitute Senior Indebtedness
      but
      for the operation of this clause (vi)), (vii) amounts owed by the Company for
      compensation to employees or for services rendered to the Company, (viii)
      Indebtedness of the Company to any Subsidiary or any other Affiliate of the
      Company or any such Affiliate's Subsidiaries, (ix) amounts owing under leases
      and (x) Indebtedness which when incurred and without respect to any election
      under Section 1111(b) of Title 11 of the United States Code is without recourse
      to the Company or any Subsidiary.

    

    

      
        
          
          

        

        
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    "Subordinated
      Indebtedness" means, as of the date of any determination thereof, all unsecured
      Indebtedness of the Company which shall contain or have applicable thereto
      subordination provisions providing for the subordination thereof to other the
      Indebtedness of the Company (including, without limitation, the
      Notes).

    

    "Subsidiary"
      means, as to any Person, any corporation, association or other business entity
      in which such Person or one or more of its Subsidiaries or such Person and
      one
      or more of its Subsidiaries owns sufficient equity or voting interests to enable
      it or them (as a group) ordinarily, in the absence of contingencies, to elect
      a
      majority of the directors (or Persons performing similar functions) of such
      entity, and any partnership or joint venture if more than a 50% interest in
      the
      profits or capital thereof is owned by such Person or one or more of its
      Subsidiaries or such Person and one or more of its Subsidiaries (unless such
      partnership can and does ordinarily take major business actions without the
      prior approval of such Person or one or more of its Subsidiaries). Unless the
      context otherwise clearly requires, any reference to a "Subsidiary"
      is a reference to a Subsidiary of the Company.

    

    "Subsidiary
      Guarantee" is defined in Section 3.2.

    

    "Transaction
      Shares" means collectively, the Principal Shares, the Interest Shares, the
      Prepayment Shares and the Warrant Shares.

    

    "Warrant
      Shares" means the shares of Common Stock issuable upon exercise of the
      Warrants.

    

    SECTION
      2. AUTHORIZATION
      OF UNITS; PRIORITY

    

    2.1
      AUTHORIZATION OF UNITS. The Company will authorize the issue and sale of up
      to
      12,500 units (the "Units") at a price (the "Subscription Price") of $1,000
      per
      Unit. Each Unit consists of (i) a $1,000 6% Senior Subordinated Note (the
      "Note"), and (ii) warrants to purchase shares of the Company's common stock,
      par
      value $0.01 per share (the "Common Stock") for an exercise price per share
      as
      set forth therein (the "Warrant"). The Note and Warrant shall be substantially
      in the forms set out in Exhibits A and B, respectively.

    

    

      
        
          
          

        

        
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    2.2
      PRIORITY OF NOTES. The Notes shall rank pari passu in terms of payment and
      shall
      be equal in priority to the 6% Senior Subordinated Notes dated July 31, 2003
      in
      the original principal amount of $7,500,000.

    

    SECTION
      3. SALE
      AND
      PURCHASE OF UNITS.

    

    3.1
      UNITS. Subject to the terms and conditions of this Agreement, the Company will
      issue and sell to each Purchaser and each Purchaser will purchase from the
      Company, at the Closing provided for in Section 4, such number of Units
      specified opposite such Purchaser's name in Schedule A at the aggregate
      Subscription Price. The obligations of each Purchaser hereunder are several
      and
      not joint obligations and each Purchaser shall have no obligation and no
      liability to any Person for the performance or nonperformance by any other
      Purchaser hereunder.

    

    3.2
      SUBSIDIARY GUARANTEE. The payment by the Company of all amounts due with respect
      to the Notes and the performance by the Company of its obligations under this
      Agreement will be unconditionally guaranteed by all Eligible Subsidiaries of
      the
      Company (the "Guarantors") under the subsidiary guarantee (the "Subsidiary
      Guarantee") which shall be in substantially the form attached hereto as Exhibit
      C.

    

    SECTION
      4. CLOSING.

    

    The
      sale
      and purchase of the Units to be purchased by each Purchaser shall occur at
      10:00
      am Miami time, at a closing (the "Closing") on September 29, 2004 or on such
      other Business Day as may be agreed upon by the Company and the Purchasers.
      At
      the Closing, the Company will deliver to J. Giordano Securities, LLC, as agent
      for each Purchaser, the Units to be purchased by such Purchaser dated the date
      of the Closing and registered in such Purchaser's name, against delivery by
      such
      Purchaser to the Company or its order of immediately available funds in the
      amount of the Subscription Price therefor by wire transfer of immediately
      available funds for the account of the Company to account number 9660323321,
      account name 21st Century Holding Company Operating, at Union Planters Bank,
      ABA
      Number 067008414. If at the Closing the Company shall fail to tender such Units
      to any Purchaser as provided above in this Section 4, such Purchaser shall,
      at
      such Purchaser's election, be relieved of all further obligations under this
      Agreement, without thereby waiving any rights such Purchaser may have by reason
      of such failure or such nonfulfillment.

    

    SECTION
      5. REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY.

    

    The
      Company represents and warrants to each Purchaser that:

    

    5.1
      ORGANIZATION. The Company is a corporation duly organized, validly existing
      and
      in good standing under the laws of Florida with full power and authority to
      own,
      lease, license and use its properties and assets and to carry out the businesses
      in which it is engaged in. The Company is duly qualified to transact the
      business in which it is engaged and is in good standing as a foreign corporation
      in every jurisdiction in which its ownership, leasing, licensing or use of
      property or assets or the conduct of its business make such qualification
      necessary, except where the failure to be so qualified would not individually
      or
      in the aggregate have a Material Adverse Effect.

    

    

      
        
          
          

        

        
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    5.2
      POWER
      AND AUTHORIZATION. The Company has all requisite power and authority to (i)
      execute, deliver and perform its obligations under this Agreement; and (ii)
      to
      issue and sell the Units. All necessary corporate proceedings of the Company
      have been duly taken to authorize the execution, delivery, and performance
      of
      this Agreement. This Agreement has been duly authorized by the Company and,
      when
      executed and delivered by the Company, will constitute the legal, valid and
      binding obligation of the Company enforceable against the Company in accordance
      with its terms, except (i) as such enforceability may be limited by bankruptcy,
      insolvency, reorganization, moratorium, fraudulent conveyance or similar laws
      affecting creditors' rights generally; (ii) as enforceability of any
      indemnification, contribution or exculpation provision may be limited under
      applicable federal and state securities laws; and (iii) that the remedy of
      specific performance and injunctive and other forms of equitable relief may
      be
      subject to the equitable defenses and to the discretion of the court before
      which any proceeding therefore may be brought.

    

    5.3
      PUBLIC DISCLOSURE. As of their respective filing dates, none of the Company's
      filings with the SEC (the "Public Filings") contained any untrue statement
      of a
      material fact or omitted any material fact required to be stated therein or
      necessary to make the statements made therein, in light of the circumstances
      in
      which they were made, not misleading, except to the extent such filings have
      been prior to the date hereof corrected, updated or superseded by a document
      subsequently filed with the SEC.

    

    SECTION
      6. REPRESENTATIONS
      OF THE PURCHASER.

    

    Each
      Purchaser hereby represents and warrants to, and agrees with, the Company
      as follows:

    

    6.1
      It is
      an "accredited investor" as that term is defined in Rule 501(a) of Regulation
      D
      promulgated under the Securities Act.

    

    6.2
      If a
      natural person, the Purchaser is: a bona fide resident of the state contained
      in
      the address set forth on Schedule A as the Purchaser's home address; at least
      21
      years of age; and legally competent to execute this Agreement. If an entity,
      the
      Purchaser is duly authorized to execute this Agreement and this Agreement
      constitutes the legal, valid and binding obligation of the Purchaser enforceable
      against the Purchaser in accordance with its terms.

    

    6.3
      The
      Purchaser is familiar with the Company's business, plans and financial
      condition, the terms of the offering of the Units (the "Offering"), and any
      other matters relating to the Offering; the Purchaser has received all materials
      that have been requested by the Purchaser; the Purchaser has had a reasonable
      opportunity to ask questions of the Company and its representatives; and the
      Company has answered all inquiries that the Purchaser or the Purchaser's
      representatives have put to it. The Purchaser has had access to all additional
      non-confidential information necessary to verify the accuracy of the information
      set forth in this Agreement and any other materials furnished herewith, and
      has
      taken all the steps necessary to evaluate the merits and risks of an investment
      as proposed hereunder. Without limiting the foregoing, the Purchaser
      acknowledges that it has reviewed certain information regarding the Company,
      its
      business and the terms of this Offering, including but not limited to, the
      information contained in the Offering Document dated September , 2004 (the
      "Offering Document").

    

    

      
        
          
          

        

        
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    6.4
      The
      Purchaser has such knowledge and experience in finance, securities, investments
      and other business matters so as to be able to protect the interests of the
      Purchaser in connection with this transaction, and the Purchaser's investment
      in
      the Company hereunder is not material when compared to the Purchaser's total
      financial capacity.

    

    6.5
      The
      Purchaser understands the various risks of an investment in the Company as
      proposed herein, including without limitation those set forth in the Offering
      Document and in the Public Filings, and can afford to bear such risks,
      including, without limitation, the risks of losing the entire
      investment.

    

    6.6
      The
      Purchaser acknowledges that no market for the Units currently exists and none
      may develop in the future and that the Purchaser may find it impossible to
      liquidate the investment at a time when it may be desirable to do so, or at
      any
      other time.

    

    6.7
      The
      Purchaser has been advised by the Company that the Units have not been
      registered under the Securities Act, that the Securities will be issued on
      the
      basis of the statutory exemption provided by Section 4(2) of the Securities
      Act
      or Regulation D promulgated thereunder, or both, relating to transactions by
      an
      issuer not involving any public offering and under exemptions under certain
      state securities laws, that this transaction has not been reviewed by, passed
      on
      or submitted to any federal or state agency or self-regulatory organization
      where an exemption is being relied upon, and that the Company's reliance thereon
      is based in part upon the representations made by the Purchaser in this
      Agreement. The Purchaser acknowledges that the Purchaser has been informed
      by
      the Company of, or is otherwise familiar with, the nature of the limitations
      imposed by the Securities Act and the rules and regulations thereunder on the
      transfer of the Units. In particular, the Purchaser agrees that the Company
      shall not be required to give any effect to sale, assignment or transfer, unless
      (i) the sale, assignment or transfer of such Units is registered under the
      Securities Act, it being understood that the Units are not currently registered
      for sale and that the Company has no obligation or intention to so register
      the
      Securities except as set forth herein, or (ii) such Units are sold, assigned
      or
      transferred in accordance with all the requirements and limitations of Rule
      144
      under the Securities Act, or (iii) such sale, assignment or transfer is
      otherwise exempt from registration under the Securities Act. The Purchaser
      further understands that an opinion of counsel and other documents may be
      required to transfer the Units. The Purchaser acknowledges that the Units shall
      be subject to stop transfer orders and the certificate or certificates
      evidencing any Units shall bear the following or a substantially similar legend
      or such other legend as may appear on the forms of Units and such other legends
      as may be required by state blue sky laws:

    

    "THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
      FOREIGN SECURITIES LAWS AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN
      MAY
      BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A
      REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES
      ACT AND ANY APPLICABLE STATE OR FOREIGN SECURITIES LAWS, OR (2) THE COMPANY
      RECEIVES AN OPINION OF COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL
      AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES
      MAY
      BE OFFERED, SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED
      WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
      APPLICABLE STATE OR FOREIGN SECURITIES LAWS."

    

    

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

    6.8
      The
      Purchaser will acquire the Units for the Purchaser's own account (or for the
      joint account of the Purchaser and the Purchaser's spouse either in joint
      tenancy, tenancy by the entirety or tenancy in common) for investment and not
      with a view to the sale or distribution thereof or the granting of any
      participation therein, and has no present intention of distributing or selling
      to others any of such interest or granting any participation
      therein.

    

    6.9
      Neither the Company nor any of the officers, directors, shareholders, partners,
      employees or agents of either, or any other Persons, whether expressly or by
      implication, have represented, guaranteed or warranted that,

    

    (a)
      The
      Company or the Purchaser will realize any given percentage of profits and/or
      amount or type of consideration, profit or loss as a result of the Company's
      activities or the Purchaser's investment in the Company; or

    

    (b)
      the
      past performance or experience of the management of the Company, or of any
      other
      person, will in any way indicate the predictable results of the ownership of
      the
      Units or of the Company's activities.

    

    6.10
      No
      oral or written representations have been made other than as stated in this
      Agreement, the Offering Document dated September , 2004, and the Purchaser
      has
      not relied on any oral or written representation from the Company other than
      as
      set forth in this Agreement and the Offering Document in making its investment
      decision. The Purchaser hereby acknowledges that the information and
      representations set forth in this Agreement and the Offering Document supersede
      all prior information and representations provided to the Purchaser in
      connection with the Offering.

    

    6.11
      The
      Purchaser is not purchasing the Units as a result of or subsequent to any
      advertisement, press release, public announcement, article, notice or other
      communication published in any newspaper, magazine or similar media or broadcast
      over television or radio, or presented at any seminar or meeting.

    

    6.12
      The
      Purchaser is not relying on the Company with respect to the tax and other
      economic considerations of an investment.

    

    6.13
      The
      Purchaser understands that the net proceeds from the Offering (after deduction
      for expenses of the Offering) will be used in all material respects for the
      purposes set forth in the Offering Document.

    

    

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

    6.14
      The
      Purchaser acknowledges that the representations, warranties and agreements
      made
      by the Purchaser herein shall survive the execution and delivery of this
      Agreement and the purchase of the Units.

    

    6.15
      Blue
      Sky matters:

    

    THE
      UNITS
      HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT, OR THE SECURITIES LAWS OF
      ANY
      STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE
      REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. THE UNITS HAVE
      NOT BEEN APPROVED OR DISAPPROVED BY THE SEC, ANY STATE SECURITIES COMMISSION
      OR
      OTHER REGULATORY AUTHORITY, NOR HAVE ANY OTHER FOREGOING AUTHORITIES PASSED
      UPON
      OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY
      IS
      UNLAWFUL.

    

    THE
      UNITS
      ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE
      TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND
      APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
      THEREFROM. SUBSCRIBERS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
      FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF
      TIME.

    

    6.16
      The
      Purchaser agrees to use its reasonable best efforts to make all warranties
      and
      representations required by the securities laws of Purchaser's jurisdiction
      of
      domicile necessary to enable the Company to issue the Transaction Shares in
      compliance with such securities laws.

    

    6.17
      The
      Purchaser acknowledges that as a result of its investment hereunder it may
      become subject to the reporting requirements of Sections 13 and 16 of the
      Exchange Act. In the event that Purchaser becomes subject to the reporting
      requirements of Sections 13 and 16, Purchaser agrees to file a Schedule 13-D
      and
      a Form 3 no later than 10 days from the Closing and to keep current such filings
      in accordance with the requirements of Sections 13 and 16.

    

    6.18
      The
      Purchaser has consulted his own financial, legal and tax advisors with respect
      to the economic, legal and tax consequences of an investment in the Units and
      has not relied on the Company, its officers, directors or professional advisors
      for advice as to such consequences.

    

    SECTION
      7. PAYMENT
      OF THE NOTES.

    

    7.1
      REQUIRED PAYMENTS.

    

    (a)
      PRINCIPAL. The principal amount of the Notes shall be due and payable in equal
      quarterly installments commencing on January 31, 2005 with the last installment
      due on September 29, 2007 (the date due of each quarterly installment is
      referred to herein as a "Quarterly Payment Date" and the last Quarterly Payment
      Date on September 29, 2007 is referred to as the "Maturity Date"). Each
      principal payment shall be paid in United States dollars or, to the extent
      legally permitted, in shares of Common Stock (the "Principal Shares"), at the
      Company's option; provided, however, that the Company shall make principal
      payments in Principal Shares only to the extent provided in Section 12 hereof.
      If such principal payment is paid in Principal Shares, then the number of
      Principal Shares to be issued on account of the principal payment shall be
      equal
to
      (i)
      the amount of the principal payment due divided by (ii) 95% of the
      weighted-average volume price for the Common Stock on Nasdaq as reported by
      Bloomberg Financial Markets ("Bloomberg") for the 20 consecutive trading days
      prior to the Quarterly Payment Date (the "Calculation Price"). In the event
      the
      Company elects to pay the principal amount due in Principal Shares, (a) it
      shall
      notify the Holder of its election no later than 15 days prior to the
      commencement of the 20 consecutive trading day period referenced above, (b)
      it
      shall issue the applicable Principal Shares on the Quarterly Payment Date,
      and
      (c) it shall file a registration statement covering resale of the applicable
      Principal Shares (the "Registration Statement") no later than two Business
      Days
      following the Quarterly Payment Date.

    

    

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

    (b)
      COMPENSATORY PAYMENT. If a principal payment is made in Principal Shares and
      (i)
      the date of effectiveness (the "Effective Date") of the applicable Registration
      Statement is more than 10 Business Days after the relevant Quarterly Payment
      Date and (ii) the weighted-average volume price for the Common Stock on Nasdaq
      as reported by Bloomberg for the three Business Day period ending on (and
      including) the Effective Date (the "Post-Issuance Average Price") is less than
      the Calculation Price, then the Company shall pay to each holder of the Notes
      an
      amount equal to (i) the difference between the Calculation
      Price and the Post-Issuance Average Price, multiplied by (ii) the number of
      Principal Shares issued on the applicable Quarterly Payment Date. Such amount
      shall be paid to each holder of the Notes in cash not later than 10 Business
      Days following the Effective Date of the applicable Registration
      Statement."

    

    7.2
      CHANGE IN CONTROL.

    

    (a)
      NOTICE OF CHANGE IN CONTROL OR CONTROL EVENT. The Company will, within 15
      Business Days after any Responsible Officer has knowledge of the occurrence
      of
      any Change in Control or Control Event (subject in the case of any Control
      Event
      to contractual limitations on disclosure and disclosure limitations imposed
      by
      applicable securities laws), give written notice of such Change in Control
      or
      Control Event to each holder of Notes unless notice in respect of such Change
      in
      Control (or the Change in Control contemplated by such Control Event) shall
      have
      been given pursuant to this Section 7.2. If a Change in Control has occurred,
      such notice shall contain and constitute an offer to prepay
      Notes as described in of this Section 7.2 and shall be accompanied by the
      certificate described in this Section 7.2.

    

    (b)
      OFFER
      TO PREPAY NOTES. The offer to prepay Notes contemplated by this Section 7.2(b)
      shall be an offer to prepay, in accordance with and subject to this Section
      7.2,
      all, but not less than all, the Notes held by each holder (in this case only,
      "holder" in respect of any Note registered in the name of a nominee for a
      disclosed beneficial owner shall mean such beneficial owner) on a date specified
      in such offer (the "Proposed Prepayment Date"). If such Proposed Prepayment
      Date
      is in connection with an offer contemplated by this Section 7.2, such date
      shall
      be not less than 30 days and not more than 60 days after the date of such offer
      (if the Proposed Prepayment Date shall not be specified in such offer, the
      Proposed Prepayment Date shall be the 30th day after the date of such
      offer).

    

    

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

    (c)
      ACCEPTANCE. A holder of Notes may accept the offer to prepay made pursuant
      to
      this Section 7.2 by causing a notice of such acceptance to be delivered to
      the
      Company at least 15 days prior to the Proposed Prepayment Date. A failure by
      a
      holder of Notes to respond to an offer to prepay made pursuant to this Section
      7.2 shall be deemed to constitute a rejection of such offer by such
      holder.

    

    (d)
      PREPAYMENT. Prepayment of the Notes to be prepaid pursuant to this Section
      7.2
      shall be at 101% of the then-outstanding principal amount of such Notes together
      with interest on such Notes accrued to the date of prepayment (the "Change
      in
      Control Prepayment"). The prepayment shall be made on the Proposed Prepayment
      Date except as provided in Section 7.2(e). The Company may pay the Change in
      Control Prepayment in United States dollars or in shares of Common Stock (the
      "Prepayment Shares"), at the Company's option. In the event the Company pays
      the
      Change in Control Prepayment in Prepayment Shares, it shall prepare and file
      with the Securities and Exchange Commission, a Registration Statement on Form
      S-3 covering the resale of the Prepayment Shares within 5 days of the issuance
      of the Prepayment Shares. The Company shall pay the Change in Control
      Prepayment in Prepayment Shares only to the extent provided in Section 12
      hereof. If the Change in Control Prepayment is paid in Prepayment Shares, then
      the number of Prepayment Shares to be issued on account of the prepayment shall
      be equal to the amount of the Change in Control Prepayment divided by 95% of
      the
      weighted-average volume price for the Common Stock on Nasdaq as reported by
      Bloomberg for the 20 consecutive trading days prior to the date of the Proposed
      Prepayment Date. In the event the Company elects to pay the Change in Control
      Prepayment in Prepayment Shares, it shall notify the Holder of its election
      no
      later than 15 days prior to the commencement of the 20 consecutive trading
      day
      period referenced above.

    

    (e)
      DEFERRAL PENDING CHANGE IN CONTROL. The obligation of the Company to prepay
      Notes pursuant to the offer required by this Section 7.2 is subject to the
      occurrence of the Change in Control in respect of which such offer and
      acceptance shall have been made. In the event that such Change in Control does
      not occur on the Proposed Prepayment Date in respect thereof, the prepayment
      shall be deferred until, and shall be made on the date on which, such Change
      in
      Control occurs. The Company shall keep each holder of Notes reasonably and
      timely informed of (i) any such deferral of the date of prepayment, (ii) the
      date on which such Change in Control and the prepayment are expected to occur,
      and (iii) any determination by the Company that efforts to effect such Change
      in
      Control have ceased or been abandoned (in which case the offers and acceptances
      made pursuant to this Section 7.2 in respect of such Change in Control shall
      be
      deemed rescinded).

    

    (f)
      CONTENT OF OFFER. Each offer to prepay the Notes pursuant to this Section 7.2
      shall, specify:

    

    (i)
      the
      Proposed Prepayment Date;

    

    (ii)
      that
      such offer is made pursuant to this Section 7.2;

    

    (iii)
      the
      principal amount of each Note offered to be prepaid;

    

    

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

    (iv)
      the
      interest that would be due on each Note offered to be prepaid, accrued to the
      Proposed Prepayment Date;

    

    (v)
      that
      the conditions of this Section 7.2 have been fulfilled; and

    

    (vi)
      in
      reasonable detail, the nature and date or proposed date of the Change in
      Control.

    

    (g)
      "CHANGE IN CONTROL" DEFINED. "Change in Control" means each and every issue,
      sale or other disposition of shares of stock of the Company which results in
      any
      person (as such term is used in Section 13(d) and Section 14(d)(2) of the
      Exchange Act) or related persons constituting a group (as such term is used
      in
      Rule 13d-5 under the Exchange Act) (herein, an "Acquiring Person") becoming
      the
      "beneficial owners" (as such term is used in Rule 13d-3 under the Exchange
      Act
      as in effect on the date of the Closing), directly or indirectly, of more than
      50% (by total voting power) of the issued and outstanding capital stock of
      the
      Company which is entitled to vote in the election of the members of the
      Company's board of directors.

    

    (h)
      "CONTROL EVENT" DEFINED. "Control Event" means:

    

    (i)
      the
      execution by the Company or any of its Subsidiaries or Affiliates of any
      agreement or letter of intent with respect to any proposed transaction or event
      or series of transactions or events which, individually or in the aggregate,
      may
      reasonably be expected to result in a Change in Control, or

    

    (ii)
      the
      execution of any written agreement which, when fully performed by the parties
      thereto, would result in a Change in Control.

    

    SECTION
      8. SUBORDINATION
      OF NOTES AND GUARANTY.

    

    8.1
      NOTES
      SUBORDINATE TO SENIOR INDEBTEDNESS. The Company covenants and agrees, and each
      Purchaser of a Note, by its acceptance thereof, likewise covenants and agrees,
      for the benefit of the holders, from time to time, of Senior Indebtedness that,
      to the extent and in the manner hereinafter set forth in this Section, the
      Indebtedness represented by the Notes and the payment of the principal of (and
      premium, if any) and interest on each and all of the Notes are hereby expressly
      made subordinate and subject in right of payment as provided in this Section
      to
      the prior payment in full in cash or cash equivalents or in any other form
      acceptable to each holder of Senior Indebtedness, of all Senior Indebtedness;
      provided, however, that the Notes, the Indebtedness represented thereby and
      the
      payment of the principal of (and premium, if any) and interest on the Notes
      in
      all respects shall rank equally with, or prior to, all existing and future
      senior subordinated indebtedness (including, without limitation, Indebtedness)
      of the Company that is subordinated to Senior Indebtedness.

    

    8.2
      SUBORDINATION OF GUARANTY. The Guaranty issued by any Guarantor will be
      unsecured senior subordinated obligations of such Guarantor, ranking pari passu
      with all other existing and future senior subordinated indebtedness of such
      Guarantor, if any. The Indebtedness evidenced by such Subsidiary Guarantee
      will
      be subordinated on the same basis as the guaranty of any Senior Indebtedness
      of
      such Guarantor as the Notes are subordinated to Senior
      Indebtedness.

    

    

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

    SECTION
      9. PAYMENT
      OF INTEREST.

    

    9.1
      INTEREST. The principal amount of the Notes outstanding shall bear interest
      at
      the rate of 6% per annum beginning on the date of issuance. Interest shall
      be
      payable quarterly beginning on January 31, 2005. Each interest payment shall
      be
      paid in United States dollars or, to the extent legally permitted, in shares
      of
      Common Stock (the "Interest Shares"), at the Company's option; provided,
      however, that the Company shall make interest payments in Interest Shares only
      to the extent provided in Section 12 hereof. If such interest payment is paid
      in
      Interest Shares, then the number of Interest Shares to be issued on account
      of
      the interest payment shall be equal to (i) the amount of the interest payment
      due divided by (ii) the Calculation Price. In the event the Company elects
      to
      pay the interest amount due in Interest Shares, (a) it shall notify the Holder
      of its election no later than 15 days prior to the commencement of the 20
      consecutive trading day period referenced in Section 7.1 above, (b) it shall
      issue the applicable Interest Shares on the Quarterly Payment Date, and (c)
      it
      shall file the Registration Statement covering resale of the applicable Interest
      Shares no later than two Business Days following the Quarterly Payment
      Date.

    

    9.2
      COMPENSATORY PAYMENT. If an interest payment is made in Interest Shares and
      (i)
      the Effective Date of the applicable Registration Statement is more than 10
      Business Days after the relevant Quarterly Payment Date and (ii) the
      Post-Issuance Average Price of the applicable Interest Shares is less than
      the
      Calculation Price, then the Company shall pay to each holder of the Notes an
      amount equal to (i) the difference between the Calculation Price and the
      Post-Issuance Average Price, multiplied by (ii) the number of Interest Shares
      issued on the applicable Quarterly Payment Date. Such amount shall be paid
      to
      each holder of the Notes in cash not later than 10 Business Days following
      the
      Effective Date of the applicable Registration Statement."

    

    SECTION
      10. NEGATIVE
      COVENANTS.

    

    The
      Company covenants that so long as any of the Notes are outstanding:

    

    10.1
      LIMITATION ON LIENS. The Company will not, and will not permit any of its
      Subsidiaries to, directly or indirectly create, incur, assume or permit to
      exist
      (upon the happening of a contingency or otherwise), any Lien on or with respect
      to any property or asset (including, without limitation, any document or
      instrument in respect of goods or accounts receivable) of the Company or any
      such Subsidiary, whether now owned or held or hereafter acquired, or any income
      or profits therefrom, or assign or otherwise convey any right to receive income
      or profits except:

    

    (a)
      Liens
      for taxes, assessments or other governmental charges which are not yet due
      and
      payable;

    

    (b)
      Liens
      incidental to the conduct of business or the ownership of properties and assets
      (including landlords', carriers', warehousemen's, mechanics', materialmen's
      and
      other similar Liens) and Liens to secure the performance of bids, tenders,
      leases, or trade contracts, or to secure statutory obligations (including
      obligations under workers compensation, unemployment insurance and other social
      security legislation), surety or appeal bonds or other Liens incurred in the
      ordinary course of business and not in connection with the borrowing of
      money;

    

    

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

    
      (c)
        leases or subleases entered into by the Company or its Subsidiaries as either
        lessors or sublessors, easements, rights-of-way, restrictions and other similar
        charges or encumbrances (including zoning restrictions), in each case incidental
        to the ownership of property or assets or the ordinary conduct of the business
        of the Company or any of its Subsidiaries, provided that such Liens do not,
        in
        the aggregate, detract from the value of such property in any material
        way;

      

      (d)
        Liens
        incidental to minor survey exceptions and similar Liens, provided that such
        Liens do not, in the aggregate, materially detract from the value of such
        property;

      

      (e)
        Liens
        on property or assets of Subsidiaries securing Indebtedness owing to the
        Company
        or to another Subsidiary;

      

      (f)
        Liens
        existing on the date of Closing which secure outstanding Indebtedness of
        the
        Company and its Subsidiaries;

      

      (g)
        any
        Lien existing on property of a Person immediately prior to its being
        consolidated with or merged into the Company or a Subsidiary or its becoming
        a
        Subsidiary, or any Lien existing on any property acquired by the Company
        or any
        Subsidiary at the time such property is so acquired (whether or not the
        Indebtedness secured thereby shall have been assumed; and

      

      (h)
        Liens
        pursuant to indebtedness created in connection with or incidental to a merger,
        acquisition, purchase of assets or other business combinations.

      

      (i)
        any
        extensions, renewals or replacements of any Lien permitted by the preceding
        subparagraphs of this Section 10.1, provided that (i) no additional property
        shall be encumbered by such Liens, (ii) the unpaid principal amount of the
        Indebtedness secured thereby shall not be increased prior to or on or after
        the
        date of any extension, renewal or replacement, (iii) the weighted average
        life
        to maturity of the Indebtedness secured by such Liens shall not be reduced,
        and
        (iv) at such time and immediately after giving effect thereto, no Default
        or
        Event of Default would exist.

    

    

    10.2
      MERGER, CONSOLIDATION. The Company will not, and will not permit any

    Subsidiary
      to, consolidate with or be a party to a merger with any other Person; provided,
      however, that:

    

    
      
        (a)
          any
          Subsidiary may merge or consolidate with or into the Company, so long as
          in any
          merger or consolidation involving the Company, the Company shall be the
          surviving entity;

    

    

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

    (b)
      any
      Subsidiary may merge or consolidate with or into any other Person if either
      (x)
      the Subsidiary shall be the surviving entity, or (y) if the Subsidiary is not
      the surviving entity, such transaction is permitted by Section 10.3;
      and

    

    (c)
      the
      Company may consolidate or merge with any other Person if (i) either (x) the
      Company shall be the surviving entity, or (y) if the surviving entity is other
      than the Company, such entity expressly assumes, by written agreement reasonably
      satisfactory in scope and form to the Required Holders, all obligations of
      the
      Company under the Notes, the Warrants and this Agreement, and (ii) at the time
      of such consolidation or merger and after giving effect thereto, no Default
      or
      Event of Default shall have occurred and be continuing.

    

    10.3
      SALES OF ASSETS. The Company will not, and will not permit any Subsidiary to,
      sell, lease or otherwise dispose of substantially all of the assets of the
      Company and its Subsidiaries unless the consideration received by the Company
      or
      such Subsidiary for such sale is not less than the Fair Market Value of the
      assets sold (as determined by the Board of Directors of the Company, whose
      determination shall be conclusive and evidenced by a Board
      Resolution).

    

    10.4
      TRANSACTIONS WITH AFFILIATES. The Company will not, and will not permit any
      Subsidiary to enter into, directly or indirectly, any Material transaction
      or
      Material group of related transactions (including without limitation the
      purchase, lease, sale or exchange of properties of any kind or the rendering
      of
      any service) with any Affiliate (other than the Company or another Subsidiary),
      except upon fair and reasonable terms no less favorable to the Company or such
      Subsidiary than would be obtainable in a comparable

    arm's-length
      transaction with a Person not an Affiliate.

    

    10.5
      LIMITATION ON INDEBTEDNESS. The Company will not, and will not permit any
      Subsidiary to, create, issue, assume, guarantee or in any manner become directly
      or indirectly liable for the payment of, or otherwise incur (collectively,
      "incur"), any Indebtedness (including any Acquired Indebtedness), other than
      Permitted Indebtedness.

    

    10.6
      LIMITATION ON RESTRICTED PAYMENTS.

    

    (a)
      The
      Company will not, and will not permit any Subsidiary to, directly or
      indirectly:

    

    (i)
      declare or pay any dividend on, or make any distribution to holders of, any
      shares of the Common Stock of the Company or any Subsidiary (other than the
      declaration or payment of dividends or distributions to the extent declared
      or
      paid to the Company or any Subsidiary or in accordance with the Company's
      dividend payment policy);

    

    (ii)
      purchase, redeem or otherwise acquire or retire for value, directly or
      indirectly, any shares of Common Stock of the Company or any Affiliate of the
      Company (other than as authorized by the Board of Directors or Common Stock
      of
      any Subsidiary) or any options, warrants or other rights to acquire such shares
      of Common Stock; or

    

    (iii)
      make any principal payment on, or repurchase, redeem, defease or otherwise
      acquire or retire for value, prior to any scheduled principal payment, sinking
      fund payment or maturity, any Subordinated Indebtedness of the Company or any
      Subsidiary.

    

    

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

    10.7
      LIMITATION ON SALE AND LEASEBACK TRANSACTIONS. The Company shall not, and shall
      not permit any Subsidiary to, directly or indirectly, enter into any Sale and
      Leaseback Transaction with respect to any property or assets (whether now owned
      or hereafter acquired), unless (i) the sale or transfer of such property or
      assets to be leased is treated as a sale of assets and the Company complies
      with
      Section 10.3, and (ii) the Company or such Subsidiary would be permitted to
      incur Indebtedness under Section 10.5 in the amount of the Capitalized Lease
      Obligations incurred in respect of such Sale and Leaseback
      Transaction.

    

    SECTION
      11. EVENTS
      OF
      DEFAULT.

    

    An
      "Event
      of Default" shall exist if any of the following conditions or events shall
      occur
      and be continuing:

    

    
      (a)
        the
        Company defaults in the payment of any principal on any Note for more than
        10
        Business Days after the same becomes due and payable, whether at maturity
        or at
        a date fixed for prepayment or by declaration or otherwise; or

      

      (b)
        the
        Company defaults in the payment of any interest on any Note for more than
        five
        Business Days after the same becomes due and payable, whether at a date fixed
        for payment or by declaration or otherwise; or

      

      (c)
        the
        Company defaults in the performance of or compliance with any Material terms
        contained herein and such default is not remedied within 30 days after receipt
        of written notice from the Required Holders of such default; or

      

      (d)
        any
        representation or warranty made in writing by or on behalf of the Company
        or any
        Guarantor or by any officer of the Company or any Guarantor in this Agreement,
        any or in any writing furnished in connection with the transactions contemplated
        hereby or thereby proves to have been false or incorrect in any Material
        respect
        on the date as of which made; or

      

      (e)
        the
        Company defaults in the payment of any principal or interest on any Indebtedness
        of the Company, in any case in an amount in excess of $1,000,000, which default
        continues for more than the applicable cure period, if any, and/or is not
        waived
        in writing by the other party thereto;

      

      (f)
        the
        Company or any Guarantor (i) is generally not paying, or admits in writing
        its
        inability to pay, its debts as they become due, (ii) files, or consents by
        answer or otherwise to the filing against it of, a petition for relief or
        reorganization or arrangement or any other petition in bankruptcy, for
        liquidation or to take advantage of any bankruptcy, insolvency, reorganization,
        moratorium or other similar law of any jurisdiction, (iii) makes an assignment
        for the benefit of its creditors, (iv) consents to the appointment of a
        custodian, receiver, trustee or other officer with similar powers with respect
        to it or with respect to any substantial part of its property, (v) is
        adjudicated as insolvent or to be liquidated, or (vi) takes corporate action
        for
        the purpose of any of the foregoing; or

      

      (g)
        a
        court or governmental authority of competent jurisdiction enters an order
        appointing, without consent by the Company or any of the Guarantors, a
        custodian, receiver, trustee or other officer with similar powers with respect
        to it or with respect to any substantial part of its property, or constituting
        an order for relief or approving a petition for relief or reorganization
        or any
        other petition in bankruptcy or for liquidation or to take advantage of any
        bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution,
        winding-up or liquidation of the Company or any of the Guarantors, or any
        such
        petition shall be filed against the Company or any of the Guarantors and
        such
        petition shall not be dismissed within 60 days.

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

    SECTION
      12. LIMITATION
      ON ISSUANCE OF COMMON STOCK.

    

    Notwithstanding
      anything to the contrary contained herein or in the Offering Document, the
      Company shall not:

    

    (a)
      (i)
      Issue any of the Transaction Shares, or (ii) adjust the number of Warrant Shares
      in accordance with the terms of the Warrants, if such issuance or adjustment
      would, either individually or together with other one or more other issuances
      or
      adjustments, cause the issuance of shares of Common Stock to exceed the number
      of shares that the Company could then issue in compliance with Section 4350(i)
      of the rules and regulations of Nasdaq (the "Nasdaq Rules") or any successor
      rule or regulation. Under Section 4350(i) of the Nasdaq Rules, a company may
      not
      issue shares, and may not issue securities convertible into shares, where the
      shares issued could in the aggregate equal 20% or more of the voting power
      of
      the shares outstanding, without obtaining shareholder approval. The foregoing
      limitation shall only apply until such time as the Company obtains the requisite
      approval of its shareholders for the issuance of the Transaction Shares, as
      required by Section 4350(i) of the Nasdaq Rules or any successor rule or
      regulation. The Company covenants and agrees that it shall include a proposal
      for the approval of the issuance of the Transaction Shares in the Company's
      proxy statement for its next annual meeting of shareholders. If, due to the
      foregoing limitation, the Company cannot adjust the Warrant Shares as provided
      in Section 8.3 of the Warrant, then, subject to NASD approval, the Company
      agrees that the exercise price thereof shall be reduced to equal the Issuance
      Price(s) of the shares of Common Stock that triggered the 

    

    (b)
      Issue
      any of the Transaction Shares, if such issuance would violate the securities
      laws of the jurisdiction in which any Purchaser receiving such shares is
      located.

    

    SECTION
      13. REMEDIES
      ON DEFAULT, ETC.

    

    13.1
      ACCELERATION.

    

    (a)
      If an
      Event of Default with respect to the Company described in Section 11 has
      occurred, all the Notes then outstanding may at any time thereafter at the
      Holder's option, by notice or notices to the Company, be declared immediately
      due and payable.

    

    Upon
      any
      Note becoming due and payable under this Section 13.1, such Note will forthwith
      mature and the entire unpaid principal amount of such Note, plus (i) all accrued
      and unpaid interest thereon shall all be immediately due and payable, in each
      and every case without presentment, demand, protest or further notice, all
      of
      which are hereby waived.

    

    13.2
      OTHER REMEDIES. If any Default or Event of Default has occurred and is
      continuing, and irrespective of whether any Notes have become or have been
      declared immediately due and payable under Section 13.1, the Required Holders
      at
      the time outstanding may proceed to protect and enforce the rights of the
      holders by an action at law, suit in equity or other appropriate proceeding,
      whether for the specific performance of any agreement contained herein or in
      any
      Note, or for an injunction against a violation of any of the terms hereof or
      thereof, or in aid of the exercise of any power granted hereby or thereby or
      by
      law or otherwise.

    

    

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    13.3
      RESCISSION. At any time after any Notes have been declared due and payable
      pursuant to Section 13.1, the holders of not less than 50% in principal amount
      of the Notes, taken individually, then outstanding, by written notice to the
      Company, may rescind and annul any such declaration and its consequences if
      (a)
      the Company has paid all overdue interest on the Notes and, all principal if
      any, on any Notes that are due and payable and are unpaid other than by reason
      of such declaration, (b) all Events of Default and Defaults, other than
      non-payment of amounts that have become due solely by reason of such
      declaration, have been cured or have been waived pursuant to Section 18, and
      (c)
      no judgment or decree has been entered for the payment of any monies due
      pursuant hereto or to any Notes. No rescission and annulment under this Section
      13.3 will extend to or affect any subsequent Event of Default or Default or
      impair any right consequent thereon.

    

    13.4
      NO
      WAIVERS OR ELECTION OF REMEDIES, EXPENSES, ETC. No course of dealing and no
      delay on the part of any holder of any Note in exercising any right, power
      or
      remedy shall operate as a waiver thereof or otherwise prejudice such holder's
      rights, powers or remedies. No right, power or remedy conferred by this
      Agreement or by any Note upon any holder thereof shall be exclusive of any
      other
      right, power or remedy referred to herein or therein or now or hereafter
      available at law, in equity, by statute or otherwise. The Company will pay
      to
      the holder of each Note on demand such further amount as shall be sufficient
      to
      cover all costs and expenses of such holder incurred in any enforcement or
      collection under this Section 12, including, without limitation, the reasonable
      attorneys' fees, expenses and disbursements for the holders.

    

    SECTION
      14. REGISTRATION;
      EXCHANGE; SUBSTITUTION OF NOTES.

    

    14.1
      REGISTRATION OF NOTES. The Company shall keep at its principal executive office
      a register for the registration and registration of transfers of Notes. The
      name
      and address of each holder of one or more Notes, each transfer thereof and
      the
      name and address of each transferee of one or more Notes shall be registered
      in
      such register. Prior to due presentment for registration of transfer, the Person
      in whose name any Note shall be registered shall be deemed and treated as the
      owner and holder thereof for all purposes hereof, and the Company shall not
      be
      affected by any notice or knowledge to the contrary.

    

    14.2
      TRANSFER AND EXCHANGE OF NOTES. Upon surrender of any Note at the principal
      executive office of the Company for registration of transfer or exchange (and
      in
      the case of a surrender for registration of transfer, duly endorsed or
      accompanied by a written instrument of transfer duly executed by the registered
      holder of such Note or its attorney duly authorized in writing and accompanied
      by the address for notices of each transferee of such Note or part thereof),
      the
      Company shall execute and deliver not more than five Business Days following
      surrender of such Note, at the Company's expense (except as provided below),
      one
      or more new Notes (as requested by the holder thereof) in exchange therefor,
      in
      an aggregate principal amount equal to the unpaid principal amount of the
      surrendered Note. Each such new Note shall be payable to such Person as such
      holder may request and shall be substantially in the form of the Note originally
      issued hereunder. Each such new Note shall be dated and bear interest from
      the
      date to which interest shall have been paid on the surrendered Note or dated
      the
      date of the surrendered Note if no interest shall have been paid thereon. The
      Company may require payment of a sum sufficient to cover any stamp tax or
      governmental charge imposed in respect of any such transfer of Notes. Notes
      shall not be transferred in denominations of less than $100,000, provided that
      if necessary to enable the registration of transfer by a holder of its entire
      holding of Notes, one Note may be in a denomination of less than $100,000.
      Any
      transferee, by its acceptance of a Note registered in its name (or the name
      of
      its nominee), shall be deemed to have made the representation set forth in
      Section 6.

    

    

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

    14.3
      REPLACEMENT OF NOTES. Upon receipt by the Company of evidence reasonably
      satisfactory to it of the ownership of and the loss, theft, destruction or
      mutilation of any Note, and

    

    (a)
      in
      the case of loss, theft or destruction, of indemnity reasonably satisfactory
      to
      it (provided that if the holder of such Note is, or is a nominee for, an
      original Purchaser or another holder of a Note with a minimum net worth of
      at
      least $50,000,000, such Person's own unsecured agreement of indemnity shall
      be
      deemed to be satisfactory), or

    

    (b)
      in
      the case of mutilation, upon surrender and cancellation thereof, the Company
      at
      its own expense shall execute and deliver not more than five Business Days
      following satisfaction of such conditions, in lieu thereof, a new Note, dated
      and bearing interest from the date to which interest shall have been paid on
      such lost, stolen, destroyed or mutilated Note or dated the date of such lost,
      stolen, destroyed or mutilated Note if no interest shall have been paid
      thereon.

    

    SECTION
      15. PAYMENTS
      ON NOTES.

    

    The
      Company will pay all sums becoming due on the Notes for principal, and interest
      by the method and at the address specified for such purpose for such Purchaser
      on Schedule A hereto or by such other method or at such other address as such
      Purchaser shall have from time to time specified to the Company in writing
      for
      such purpose, without the presentation or surrender of such Note or the making
      of any notation thereon, except that upon written request of the Company made
      concurrently with or reasonably promptly after payment or prepayment in full
      of
      any Note, such Purchaser shall surrender such Note for cancellation, reasonably
      promptly after any such request, to the Company at its principal executive
      office or at the place of payment most recently designated by the Company
      pursuant to Section 19. Prior to any sale or other disposition of any Note
      held
      by any Purchaser, such Person will, at its election, either endorse thereon
      the
      amount of principal paid thereon and the last date to which interest has been
      paid thereon or surrender such Note to the Company in exchange for a new Note
      or
      Notes pursuant to Section 14.2.

    

    

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    SECTION
      16. REGISTRATION
      RIGHTS.

    

    The
      Purchasers have entered into a registration rights agreement (the "Registration
      Rights Agreement") pursuant to which the Company has agreed to grant Purchasers
      certain registration rights with respect to the resale of the Transaction Shares
      and the Warrants.

    

    SECTION
      17. SURVIVAL
      OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

    

    All
      representations and warranties contained herein shall survive the execution
      and
      delivery of this Agreement and the related Units, the purchase or transfer
      by
      any Purchaser of any such Units or portion thereof or interest therein and
      may
      be relied upon by any subsequent holder of any such Units, regardless of any
      investigation made at any time by or on behalf of any Purchaser or any other
      holder of any such Units. This Agreement, the Subsidiary Guarantee, the Notes,
      the Warrants, and the Registration Rights Agreement embody the entire agreement
      and understanding between the Purchasers and the Company and supersede all
      prior
      agreements and understandings relating to the subject matter
      hereof.

    

    SECTION
      18. AMENDMENT
      AND WAIVER.

    

    18.1
      REQUIREMENTS.

    

    (a)
      This
      Agreement and the Notes may be amended, and the observance of any term hereof
      including subsection (i) of Section 1 hereof or of the Notes may be waived
      (either retroactively or prospectively), with (and only with) the written
      consent of the Company and the holders of Notes holding more than 50% in
      aggregate principal amount of the Notes at the time outstanding, except that
      unless otherwise provided herein (a) no amendment or waiver of any of the
      provisions of Section 1, 2, 3, 4, 5, or 6 hereof or the corresponding provision
      of any Supplement, or any defined term (as it is used in any such Section or
      such corresponding provision of any Supplement), will be effective as to any
      holder of Notes unless consented to by such holder of Notes in writing, and
      (b)
      no such amendment or waiver may, without the written consent of all of the
      holders of Notes at the time outstanding affected thereby, (i) subject to the
      provisions of Section 10 relating to acceleration or rescission, change the
      amount or time of any prepayment or payment of principal of, or reduce the
      rate
      or change the time of payment or method of computation of interest on the Notes,
      (ii) change the percentage of the principal amount of the Notes the holders
      of
      which are required to consent to any such amendment or waiver, or (iii) amend
      any of Sections 7, 10, 11.1, 14 or 16.

    

    18.2
      SOLICITATION OF HOLDERS OF NOTES.

    

    (a)
      SOLICITATION. The Company will provide each holder of the Notes (irrespective
      of
      the amount of Notes then owned by it) with sufficient information, sufficiently
      far in advance of the date a decision is required, to enable such holder to
      make
      an informed and considered decision with respect to any proposed amendment,
      waiver or consent in respect of any of the provisions hereof, or of the Notes.
      The Company will deliver executed or true and correct copies of each amendment,
      waiver or consent effected pursuant to the provisions of this Section 18 to
      each
      holder of outstanding Notes promptly following the date on which it is executed
      and delivered by, or receives the consent or approval of, the requisite holders
      of Notes.

    

    

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

    (b)
      PAYMENT. The Company will not directly or indirectly pay or cause to be paid
      any
      remuneration, whether by way of supplemental or additional interest, fee or
      otherwise, or grant any security, to any holder of Notes as consideration for
      or
      as an inducement to the entering into by any holder of Notes of any waiver
      or
      amendment of any of the terms and provisions hereof unless such remuneration
      is
      concurrently paid, or security is concurrently granted, on the same terms,
      ratably to each holder of Notes then outstanding even if such holder did not
      consent to such waiver or amendment.

    

    18.3
      BINDING EFFECT, ETC. Any amendment or waiver consented to as provided in this
      Section 18 applies equally to all holders of Notes and is binding upon them
      and
      upon each future holder of any Note and upon the Company without regard to
      whether such Note has been marked to indicate such amendment or waiver. No
      such
      amendment or waiver will extend to or affect any obligation, covenant,
      agreement, Default or Event of Default not expressly amended or waived or impair
      any right consequent thereon. No course of dealing between the Company and
      the
      holder of any Note nor any delay in exercising any rights hereunder or under
      any
      Note shall operate as a waiver of any rights of any holder of such Note. As
      used
      herein, the term "this Agreement" and references thereto shall mean this
Agreement
      as it may from time to time be amended or supplemented.

    

    18.4
      NOTES HELD BY COMPANY, ETC. Solely for the purpose of determining whether the
      holders of the requisite percentage of the aggregate principal amount of Notes
      then outstanding approved or consented to any amendment, waiver or consent
      to be
      given under this Agreement or the Notes, or have directed the taking of any
      action provided herein or in the Notes to be taken upon the direction of the
      holders of a specified percentage of the aggregate principal amount of Notes
      then outstanding, Notes directly or indirectly owned by the Company or any
      of
      its Affiliates shall be deemed not to be outstanding.

    

    SECTION
      19. NOTICES.

    

    All
      notices and communications provided for hereunder shall be in writing and sent
      (a) by telefacsimile if the sender on the same day sends a confirming copy
      of
      such notice by a recognized overnight delivery service (charges prepaid), or
      (b)
      by registered or certified mail with return receipt requested (postage prepaid),
      or (c) by a recognized overnight delivery service (with charges prepaid). Any
      such notice must be sent:

    

    (i)
      if to
      a Purchaser, to such Purchaser at the address specified for such communications
      in Schedule A to this Agreement, or at such other address as such Purchaser
      shall have specified to the Company in writing pursuant to this Section 19,
      or

    

    (ii)
      if
      to the Company, to the Company at its address set forth at the beginning hereof
      to the attention of Chief Financial Officer, with a copy to the General Counsel,
      or at such other address as the Company shall have specified to the holder
      of
      each Note in writing.

    

    Notices
      under this Section 19 will be deemed given only when actually
      received.

    

    

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

    SECTION
      20. CONFIDENTIAL
      INFORMATION.

    

    For
      the
      purposes of this Section 20, "Confidential Information" means information
      delivered to any Purchaser by or on behalf of the Company or any Subsidiary
      in
      connection with the transactions contemplated by or otherwise pursuant to this
      Agreement that is proprietary in nature and that was clearly marked or labeled
      or otherwise adequately identified when received by such Purchaser as being
      confidential information of the Company or such Subsidiary, provided that such
      term does not include information that (a) was publicly known or otherwise
      known
      to such Purchaser prior to the time of such disclosure, (b) subsequently becomes
      publicly known through no act or omission by such Purchaser or any Person acting
      on such Purchaser's behalf, or (c) otherwise becomes known to
      such
      Purchaser other than through disclosure by the Company or any Subsidiary. Each
      Purchaser will maintain the confidentiality of such Confidential Information
      in
      accordance with procedures adopted by such Purchaser in good faith to protect
      confidential information of third parties delivered to such Purchaser, provided
      that such Purchaser may deliver or disclose Confidential Information to (w)(i)
      such Purchaser's directors, trustees, officers, employees, agents, attorneys
      and
      affiliates (to the extent such disclosure reasonably relates to the
      administration of the investment represented by such Purchaser's Notes), (ii)
      such Purchaser's financial advisors and other professional advisors who agree
      to
      hold confidential the Confidential Information substantially in accordance
      with
      the terms of this Section 20, or (iii) any other holder of any Note (x) to
      effect compliance with any law, Rule, regulation or order applicable to such
      Purchaser, (y) in response to any subpoena or other legal process, provided
      that, to the extent permitted by law, each holder will use reasonable efforts
      to
      notify the Company of any request to disclose Confidential Information requested
      pursuant to any subpoena or other legal process, provided further that the
      failure to notify the Company of any such request shall not result in any
      liability to such holder, or (z) if an Event of Default has occurred and is
      continuing, to the extent such Purchaser may reasonably determine such delivery
      and disclosure to be necessary or appropriate in the enforcement or for the
      protection of the rights and remedies under such Purchaser's Notes and this
      Agreement. Each holder of a Note, by its acceptance of a Note, will be deemed
      to
      have agreed to be bound by and to be entitled to the benefits of this Section
      20
      as though it were a party to this Agreement. On reasonable request by the
      Company in connection with the delivery to any holder of a Note of information
      required to be delivered to such holder under this Agreement or requested by
      such holder (other than a holder that is a party to this Agreement or its
      nominee), such holder will enter into an agreement with the Company embodying
      the provisions of this Section 20.

    

    SECTION
      21. MISCELLANEOUS.

    

    21.1
      SUCCESSORS AND ASSIGNS. All covenants and other agreements contained in this
      Agreement by or on behalf of any of the parties hereto bind and inure to the
      benefit of their respective successors and assigns (including, without
      limitation, any subsequent holder of a Note) whether so expressed or
      not.

    

    21.2
      PAYMENTS DUE ON NON-BUSINESS DAYS. Anything in this Agreement or the Notes
      to
      the contrary notwithstanding, any payment of principal of or interest on any
      Note that is due on a date other than a Business Day shall be made on the next
      succeeding Business Day without including the additional days elapsed in the
      computation of the interest payable on such next succeeding Business
      Day.

    

    

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

    21.3
      SEVERABILITY. Any provision of this Agreement that is prohibited or
      unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
      to the extent of such prohibition or unenforceability without invalidating
      the
      remaining provisions hereof, and any such prohibition or unenforceability in
      any
      jurisdiction shall (to the full extent permitted by law) not invalidate or
      render unenforceable such provision in any other jurisdiction.

    

    21.4
      CONSTRUCTION. Each covenant contained herein shall be construed (absent express
      provision to the contrary) as being independent of each other covenant contained
      herein, so that compliance with any one covenant shall not (absent such an
      express contrary provision) be deemed to excuse compliance with any other
      covenant. Where any provision herein refers to action to be taken by any Person,
      or which such Person is prohibited from taking, such provision shall be
      applicable whether such action is taken directly or indirectly by such
      Person.

    

    21.5
      COUNTERPARTS. This Agreement may be executed in any number of counterparts,
      each
      of which shall be an original but all of which together shall constitute one
      instrument. Each counterpart may consist of a number of copies hereof, each
      signed by less than all, but together signed by all, of the parties
      hereto.

    

    21.6
      GOVERNING LAW. This Agreement shall be construed and enforced in accordance
      with, and the rights of the parties shall be governed by, the law of the State
      of Florida excluding choice-of-law principles of the law of such state that
      would require the application of the laws of a jurisdiction other than such
      state.

    

    21.7
      LEGAL RATE OF INTEREST. Regardless of any provision contained in this Agreement
      or in any Guaranty, the rate of interest borne by the Notes shall not exceed
      the
      maximum amount of nonusurious interest that may be contracted for, taken,
      reserved, charged or received under any applicable law; any interest in excess
      of that maximum amount shall be credited on the principal of the Notes or,
      if
      that has been paid, refunded. On any acceleration or required or permitted
      prepayment, any such excess shall be canceled automatically as of the
      acceleration or prepayment or, if already paid, credited on the principal of
      the
      Notes or, if the principal of the Notes has been paid, refunded. In determining
      whether or not the interest paid or payable, under any specific contingency,
      exceeds the maximum amount of nonusurious interest, the Company and holders
      of
      the Notes shall, to the maximum extent permitted under applicable law, (a)
      characterize any nonprincipal payment as an expense, fee or premium rather
      than
      as interest, (b) exclude voluntary prepayments and the effects thereof, and
      (c)
      spread the total amount of interest throughout the entire contemplated term
      of
      the Notes.

    

    21.8
      SUBMISSION TO PROCESS. THE COMPANY AND THE PURCHASERS HEREBY AGREE THAT ANY
      LEGAL ACTION OR PROCEEDING AGAINST THE COMPANY WITH RESPECT TO THIS AGREEMENT,
      OR THE NOTES SHALL BE BROUGHT IN THE COURTS OF THE STATE OF FLORIDA OR (TO
      THE
      EXTENT THEY HAVE SUBJECT MATTER JURISDICTION) OF THE UNITED STATES OF AMERICA
      FOR THE SOUTHERN DISTRICT OF FLORIDA AS THE HOLDERS OF 51% IN PRINCIPAL AMOUNT
      OF THE NOTES MAY ELECT, AND, BY EXECUTION AND DELIVERY HEREOF, THE COMPANY
      ACCEPTS AND CONSENTS, FOR ITSELF AND IN RESPECT TO ITS PROPERTY, GENERALLY
      AND
      UNCONDITIONALLY, TO THE JURISDICTION OF THE AFORESAID COURTS AND AGREES THAT
      SUCH JURISDICTION SHALL BE EXCLUSIVE, UNLESS WAIVED BY THE COMPANY AND THE
      HOLDERS OF 51% IN PRINCIPAL AMOUNT OF THE NOTES IN WRITING. THE COMPANY WAIVES
      (TO THE EXTENT PERMITTED BY APPLICABLE LAW) ANY RIGHT TO STAY OR TO DISMISS
      ANY
      ACTION OR PROCEEDING BROUGHT BEFORE SAID COURTS ON THE BASIS OF FORUM NON
      CONVENIENS.

    

    

      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

    21.9
      WAIVERS. THE COMPANY WAIVES (A) THE RIGHT TO TRIAL BY JURY (WHICH EACH HOLDER
      OF
      NOTES HEREBY ALSO WAIVES) IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF
      ANY
      KIND ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY SECURITY DOCUMENT OR
      THE
      NOTES; (B) PRESENTMENT, DEMAND AND PROTEST AND NOTICE OF PRESENTMENT, PROTEST,
      DEFAULT, NON-PAYMENT, INTENT TO ACCELERATE, ACCELERATION, MATURITY, RELEASE,
      COMPROMISE, SETTLEMENT, EXTENSION OR RENEWAL OF ANY OR ALL DOCUMENTS,
      INSTRUMENTS, AND GUARANTIES AT ANY TIME HELD BY THE HOLDERS OF NOTES (OR ANY
      AGENT THEREFOR) ON WHICH THE COMPANY MAY IN ANY WAY BE LIABLE AND HEREBY
      RATIFIES AND CONFIRMS WHATEVER THE HOLDERS OF NOTES MAY DO IN THIS REGARD;
      AND
      (C) NOTICE OF ACCEPTANCE HEREOF. THE COMPANY ACKNOWLEDGES THAT THE FOREGOING
      WAIVERS ARE A MATERIAL INDUCEMENT TO THE HOLDERS' ENTERING INTO THIS AGREEMENT
      AND THAT THE HOLDERS ARE RELYING UPON THE FOREGOING WAIVERS IN THEIR FUTURE
      DEALINGS WITH THE COMPANY. THE COMPANY WARRANTS AND REPRESENTS THAT IT HAS
      REVIEWED THE FOREGOING WAIVERS WITH ITS LEGAL COUNSEL AND HAS KNOWINGLY AND
      VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
      COUNSEL. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS WRITTEN
      CONSENT TO A TRIAL BY THE COURT.

    

    21.10
      EXCULPATION. Each party to this Agreement acknowledges that Brown Raysman
      Millstein Felder & Steiner, LLP represented J. Giordano Securities, LLC in
      the transactions contemplated by this Agreement and has not represented either
      the Company or any Purchaser in connection with such transaction.

    

    The
      execution hereof by the Purchasers shall constitute a contract among the Company
      and the Purchasers for the uses and purposes hereinabove set forth.

    

     

    

    
      	 	 	 
	 	Very
              truly
              yours,

21ST CENTURY HOLDING COMPANY
	 
 	 
 	 
 
	 	By  	 
	 	
              
Richard
              A. Widdicombe,
Chief Executive
              Officer
	 	 

    

     

    

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

    Accepted
      as of the first date written above.

    

    
      	 	 	 
	 	PURCHASER:
	 
 	 
 	 
 
	 	By  	 
	 	
              
Name:
              _______________________________________________________
	 	Title:  
              _______________________________________________________

    

    

      
        
          
          

        

        
          27

          
            

          

        

        
          
          

        

      

    EXHIBIT
      A

    

    FORM
      OF
      NOTE

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

    

    FORM
      OF
      WARRANT

    

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    EXHIBIT
      C

    

    FORM
      OF
      SUBSIDIARY GUARANTEE

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      A

    

    PURCHASERSEXHIBIT
      4.7

    21ST
      CENTURY
      HOLDING COMPANY

     

    6%
      SENIOR
      SUBORDINATED NOTE DUE SEPTEMBER 29, 2007

    

    No.
      __

    September,
      __, 2004

    $
      ______________

    

    FOR
      VALUE
      RECEIVED, the undersigned, 21STCENTURY
      HOLDING COMPANY (herein called
      the “Company”), a
      corporation organized and existing under the laws of the State of Florida
      ,
      hereby
      promises to pay to _____________________ or
      registered
      assigns,
      the principal sum of _____________________ ($________)
      with
      interest
      (computed on the basis of a 360-day year of twelve 30-day months) (a) on the
      unpaid balance
      thereof at the rate of 6% per annum from the date hereof, payable quarterly
      beginning on January
      31, 2005.

    

    This
      Note
      is one of a series of Senior Subordinated Notes (herein called the “Notes”)
      issued pursuant
      to the Unit Purchase Agreement, dated as of September 29, 2004 (as from time
      to
      time amended, supplemented or modified, the “Unit Purchase Agreement”), between
      the Company and
      the
      respective Purchasers named therein and is entitled to the benefits thereof.
      Each holder of
      this
      Note will be deemed,
      by
      its
      acceptance hereof, (i) to have agreed to the confidentiality provisions
      set forth in Section 20 of the Unit Purchase Agreement and (ii) to have made
      the
representations
      set forth in Section 6 of the Unit Purchase Agreement.

    

    This
      Note
      shall rank pari passu in terms of payment and shall be equal in priority to
      the
      6% Senior
      Subordinated Note dated as of July 31, 2003 in the original principal amount
      of
$7,500,000.

    

    Payments
      of principal of and interest on this Note are to be made, at the Company’s
      option, inlawful
      money of the United States of America or,
      in
      whole or
      in part, by the issuance to the holder
      hereof of Interest Shares, as defined in and in accordance with the Unit
      Purchase Agreement.

    

    This
      Note
      is a registered Note and, as provided in the Unit Purchase Agreement, upon
      surrender of
      this
      Note for registration of transfer, duly endorsed, or accompanied by a written
      instrument of transfer duly executed, by the registered holder hereof or such
      holder's attorney duly authorized in
      writing, a new Note for a like principal amount will be issued to, and
      registered in the name of,
      the
      transferee. Prior to due presentment for registration of transfer, the Company
      may treat the
      person in whose name this Note is registered as the owner hereof for the purpose
      of receiving payment
      and for all other purposes, and the Company will not be affected by any notice
      to the contrary.

    

    The
      Company will make required prepayments of principal on the dates and in the
      amounts specified
      in the Unit Purchase Agreement. This Note is also subject to optional
      prepayment, in whole
      or
      from time to time in part, at the times and on the terms specified in the Unit
      Purchase Agreement,
      but not otherwise.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

      If
        an
        Event
        of Default, as defined in the Unit Purchase Agreement, occurs and is continuing,
        the principal
        of
        this
        Note
        may be declared or otherwise become due and payable in the manner, at
the
        price
        and with the effect provided in the Unit Purchase Agreement.

      

      Pursuant
        to the Subsidiary Guarantee dated as of September 29, 2004 (the “Subsidiary
        Guarantee”), certain subsidiaries of the Company have absolutely and
        unconditionally guaranteed
        payment in full of the principal of, and interest on this Note and the
        performance by the
        Company of all of its obligations contained in the Unit Purchase Agreement
        all
        as more fully set
        forth
        in said Subsidiary Guarantee.

      

      This
        Note
        shall be construed and enforced in accordance with, and the rights of the
        Company and
        the
        holder hereof shall be governed by, the law of the State of Florida, excluding
        the choice-of-law
        principles of such state that would require the application of the laws of
        a
        jurisdiction other
        than such state.

       

      
        	 	 	 
	 	21ST
                CENTURY
                HOLDING COMPANY
	 
 	 
 	 
 
	 	By:  	 
	 	
                
Richard
                A. Widdicombe,
	 	Chief
                Executive Officer

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