Document:

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                                                                Exhibit 10(k)(i)

                                                                 EXECUTION COPY

                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT

         This Amended and Restated Employment Agreement, dated as of the 27th
day of September, 2000 (this "Agreement"), is entered into by and between NAHC,
Inc, a Delaware corporation (the "Company"), and David R. Burt (the
"Executive").

                              W I T N E S S E T H:

         WHEREAS, the Company wishes to employ the Executive as Chief Executive
Officer on the terms and conditions outlined herein;

         WHEREAS, the Executive is willing to serve in such capacity on the
terms and conditions outlined herein; and

         WHEREAS, this Agreement amends and restates in its entirety that
certain employment agreement dated as of the 5th day of May, 2000 by and between
the Company and the Executive (the "Original Employment Agreement").

         NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the parties hereto hereby agree as follows:

         1. EMPLOYMENT, TERM, EXTENSIONS.

         1.1. EMPLOYMENT. The Company agrees to employ the Executive, and the
Executive agrees to serve in the employ of the Company, for the term set forth
in Sections 1.2 and 1.3, in the positions and with the responsibilities, duties
and authority set forth in Section 2 and on the other terms and conditions set
forth in this Agreement.

         1.2. TERM. The term of the Executive's employment under this Agreement
shall commence on May 5, 2000 (the "Employment Date") and shall terminate on
May 5, 2005, unless sooner terminated in accordance with this Agreement.

         1.3. EXTENSIONS. This Agreement shall automatically be renewed for a
period of one year beginning as of May 5, 2005, and May 5 of each subsequent
year (each an "Automatic Renewal Date") unless either party shall have given
written notice of non-extension 90 days prior to such Automatic Renewal Date.

         2. POSITION, DUTIES. The Executive shall serve in the position of Chief
Executive Officer of the Company. As Chief Executive Officer, the Executive
shall have supervision and control over, and responsibility for, the management
and operational functions of the Company, and shall have such other powers and
duties as may from time to time be prescribed by the Board of Directors (the
"Board"), so long as such powers and duties are reasonable and customary for the
Chief Executive Officer of an enterprise comparable to the Company. The
Executive shall perform, faithfully and diligently, such duties as Chief
Executive

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Officer. As Chief Executive Officer, the Executive shall report to the
Board of Directors. The Company acknowledges that the Executive is currently the
President, Chief Executive Officer and a director of Ergo Science Corporation.
The amount of time Executive shall devote to his duties and responsibilities
hereunder will vary from week to week. On a monthly basis, however, the
Executive shall devote at least fifty percent (50%) of his business time and
attention to the performance of his duties and responsibilities hereunder. The
Company acknowledges that the Executive may conduct some of his business
activities on behalf of the Company from his offices in the Boston area.

         3. COMPENSATION: SALARY, NOTE AND BONUSES.

         3.1. SALARY. During the term of the Executive's employment, in
consideration of the performance by the Executive of the services set forth in
Section 2 and his observance of the other covenants set forth herein, the
Company shall pay to the Executive, and the Executive shall accept, a base
salary at least equal to $250,000 per annum, payable in accordance with the
standard payroll practices of the Company (the "Base Salary"). During the term
of the Executive's employment, the Base Salary shall be reviewed at least
annually by the Compensation Committee of the Board (the "Compensation
Committee") and shall be increased at any time and from time to time as the
Compensation Committee shall consider appropriate in accordance with the
compensation practices and guidelines of the Company for its executive officers.
In addition, on or prior to March 31 of each year, whether or not the
Executive's employment has been terminated for any reason on or after January 1
but prior to the date of such payment, the Executive shall receive a bonus, the
amount of which shall be determined by the Board in its discretion based on the
Executive's performance in his duties during the previous calendar year (the
"Performance Bonus"); provided, however that in each year the Performance Bonus
shall not be less than $20,000.

         3.2. NOTE.

         (a) In consideration of the Executive's efforts in settling during the
month of July 2000 the disputes related to the sale of certain assets of the
Company to Hanger Orthopedic Group, Inc., Chance Murphy, Inc. and Select Medical
Corporation (collectively, the "Asset Sale Disputes"), concurrently with the
execution of this Agreement the Company shall issue to the Executive a 10%
convertible subordinated promissory note (the "Note") substantially in the form
attached hereto as Exhibit A, in the principal amount of $60,000.

         (b) With the consent of the Company, which consent shall not be
unreasonably withheld, the Executive shall select an investment bank, accounting
firm or other entity which shall provide the Executive and the Company with a
written appraisal as to the fair market value of the Note on the date of
issuance, determined without regard to the Repurchase Right (as defined in the
Note) (the "Appraisal"). The Company shall pay all reasonable costs associated
with the Appraisal.

         (c) The Executive shall make an election under Section 83(b) of the
Code to include the value of the Note, based upon the Appraisal, in his gross
income for federal income tax purposes in the year of the Note's issuance.

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         3.3. GROSS-UP BONUS.

         (a) Also in consideration of the Executive's efforts in obtaining
settlement of the Asset Sale Disputes, the Company shall pay to Executive,
within ten (10) days after the Appraisal, an amount (the "Gross-Up Bonus") such
that after the payment by Executive of all federal, state or local income taxes
(including any interest or penalties imposed with respect thereto) imposed upon
the receipt of the Gross-Up Bonus, the Executive retains an amount of the
Gross-Up Bonus equal to the federal, state and local income taxes imposed on the
receipt of the Note. The Gross-Up Bonus shall be paid whether or not the
Executive's employment has been terminated for any reason prior to the elapse of
(ten) 10 days following the Appraisal. For purposes of determining the amount of
the Gross-Up Bonus, the Executive shall be deemed to pay federal income taxes at
the highest marginal rates of federal income taxation applicable to individuals
in the calendar year in which the Gross-Up Bonus is to be made and state and
local income taxes at the highest marginal rates of taxation applicable to
individuals as are in effect in the state and locality of the Executive's
residence in the calendar year in which the Gross-Up Bonus is to be made, net of
the maximum reduction of federal income taxes that can be obtained from
deduction of such state and local taxes, taking into account any limitations
applicable to individuals subject to federal income tax at the highest marginal
rates. If it is subsequently established (as provided in paragraph (c) below)
that the federal, state and local income taxes payable by the Executive with
respect to the receipt of the Note and the original Gross-Up Bonus exceeds the
original Gross-Up Bonus, the Company shall make an additional Gross-Up Bonus to
the Executive in respect of such excess at the time set forth in paragraph (c)
below.

         (b) The Executive shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment by
the Company of an additional Gross-Up Bonus. Such notification shall be given as
soon as practicable but no later than ten business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The failure
of the Executive to give such notice shall not relieve the Company of its
obligations under this Agreement except to the extent the Company is actually
materially prejudiced by such failure to give such notice. The Executive shall
not pay such claim prior to the expiration of the thirty (30) calendar day
period following the date on which it gives such notice to the Company (or such
shorter period ending on the date that any payment of taxes with respect to such
claim is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:

                  (i) give the Company any information reasonably requested by
         the Company relating to such claim,

                  (ii) take such action in connection with contesting such claim
         as the Company shall reasonably request in writing from time to time,
         including, without limitation, accepting legal representation with
         respect to such claim by an attorney reasonably selected by the
         Company,

                  (iii) cooperate with the Company in good faith in order to
         effectively contest such claim, and

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                  (iv) permit the Company to participate in any proceedings
         relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including legal and accounting fees and additional interest and
penalties) incurred in connection with such contest and shall indemnify and hold
the Executive harmless, on an after-tax basis, for any income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this section, the Company shall control all proceedings
taken in connection with such contest and, at its sole option, may pursue or
forgo any and all administrative appeals, proceedings, hearings and conferences
with the taxing authority in respect of such claim and may, at its sole option,
either direct the Executive to pay the tax claimed and sue for a refund or
contest the claim in any permissible manner, and the Executive agrees to
prosecute such contest to a determination before any administrative tribunal, in
a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs the
Executive to pay such claim and sue for a refund, the Company shall advance the
amount of such payment to the Executive, on an interest-free basis, and shall
indemnify and hold the Executive harmless, on an after-tax basis, from any
income tax (including interest or penalties with respect thereto) imposed with
respect to such advance or with respect to any imputed income with respect to
such advance; and further provided that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Executive
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Company's control of the
contest shall be limited to issues with respect to which a Gross-Up Bonus would
be payable hereunder and the Executive shall be entitled to settle or contest,
as the case may be, any other issue raised by the Internal Revenue Service or
any other taxing authority.

         (c) If any such claim referred to in paragraph (b) is made by the
Internal Revenue Service and the Company does not request the Executive to
contest the claim within the 30 calendar day period following notice of the
claim, the Company shall pay to the Executive the amount of any Gross-Up Bonus
owed to the Executive, but not previously paid, immediately upon the expiration
of such thirty (30) calendar day period. If any such claim is made by the
Internal Revenue Service and the Company requests the Executive to contest such
claim, but does not advance the amount of such claim to the Executive for
purposes of such contest, the Company shall pay to the Executive the amount of
any Gross-Up Bonus owed to the Executive, but not previously paid, within 5
business days of a Final Determination of the liability of the Executive for
such income tax. For purposes of this Agreement, a "Final Determination" shall
be deemed to occur with respect to a claim when (i) there is a decision,
judgment, decree or other order by any court of competent jurisdiction, which
decision, judgment, decree or other order has become final, i.e., all allowable
appeals pursuant to this section have been exhausted by either party to the
action, (ii) there is a closing agreement made under Section 7121 of the Code,
or (iii) the time for instituting a claim for refund has expired, or if a claim
was filed, the time for instituting suit with respect thereto has expired.

         3.4. RECEIVABLES BONUS. The Executive also shall be entitled to receive
from the Company an amount in cash equaling ten percent (10%) of collections on
each receivable of the Company (each, a "Receivables Bonus") in excess of the
amount at which such receivable is

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booked on the balance sheet contained in the Annual Report on Form 10-K for the
fiscal year ended June 30, 2000 (the "Booked Amount"); provided, however, that
(i) no Receivables Bonus shall apply with respect to (a) the "prudent buyer"
receivables listed on Schedule 3.4(a) hereof or (b) receivables listed on
Schedule 3.4(b) hereof that are the subject of similar arrangements between the
Company and certain of its Employees, (ii) to the extent not already reflected
in the Booked Amount, the Company's costs from and after the date hereof
associated with collecting on any receivable shall be deducted in determining
the amount of collection with respect to a receivable, and (iii) the aggregate
amount receivable by the Executive in the form of Receivables Bonuses shall not
exceed $500,000. Receivables Bonuses shall be paid within ten (10) days after
collection by the Company on the related receivable and shall be payable
following the Executive's termination of employment, unless such termination is
pursuant to Sections 6.3 or 6.5, in which case only Receivables Bonuses for
collections prior to such termination shall be payable.

         3.5. LITIGATION BONUS. The Executive also shall be entitled to receive
from the Company an amount in cash equaling 10% of the amount determined by
subtracting (i) the aggregate of the amounts to be paid following settlement or
final judgment on each of the legal actions against the Company listed on
Schedule 3.5 hereto (the "Legal Actions"), including the Company's costs from
and after the date hereof associated with reaching settlement or final judgment
on such Legal Actions., from (ii) the aggregate settlement values given for such
Legal Actions on the books of the Company as of the date hereof (the "Litigation
Bonus" and together with the Performance Bonus, the Gross-Up Bonus and the
Receivable Bonus, the "Bonuses"). The Litigation Bonus shall be paid, if at all,
within ten (10) days after settlement or final judgment of all Litigation and
shall be payable following the Executive's termination of employment, unless
such termination is pursuant to Section 6.3 or 6.5, in which case the Executive
shall receive no Litigation Bonus.

         4. EXPENSE REIMBURSEMENT. The Company shall reimburse the Executive for
all reasonable costs and expenses incurred by him in connection with the
performance of his duties hereunder, upon the presentation of proper accounts
therefore in accordance with the Company's policies. In particular, the Company
acknowledges that Executive's primary residence is in the Boston, Massachusetts
area, and Company agrees to reimburse Executive for all reasonable costs and
expenses incurred by Executive in traveling to and from the Boston area to the
Company's offices.

         5. BENEFITS. During the Executive's employment, and thereafter to the
extent provided in Section 6, the Executive shall be entitled to participate in
all employee benefit plans and programs which may be made available to the
Company's senior executives or to its employees generally, as such plans or
programs may be in effect from time to time, including, without limitation, any
hospitalization insurance, surgical insurance, and major medical insurance for
Executive, his spouse, and any dependent, profit sharing plans, savings and
similar plans, group life insurance, accidental death and dismemberment
insurance, travel accident insurance, short-term and long-term disability
insurance, sick leave (including salary continuation arrangements), holidays,
and any other employee benefit plans or programs that may be sponsored by the
Company from time to time, including any plans that supplement the above-listed
types of plans, whether funded or unfunded (the "Benefit Plans"). The Company
shall also provide the Executive with two weeks of paid vacation each year. Any
unused vacation

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days, and any other accrued paid time off as of December 31 of each year, shall
be carried over from year to year to the extent unused without limitation.

         6. TERMINATION OF EMPLOYMENT.

         6.1. DEATH. In the event of the death of the Executive, the Company
shall (i) pay to the Beneficiary (a) within ten (10) business days after the
Executive's death, the Base Salary (at the annual rate then in effect) accrued
to the date of the Executive's death and not theretofore paid to the Executive
and (b) any Bonuses which are then or shall thereafter become payable pursuant
to Section 3.

         6.2. DISABILITY. If the Executive shall become incapacitated by reason
of sickness, accident or other physical or mental disability and shall be unable
to perform his normal duties hereunder for a period of six (6) consecutive
months, then, at any time following the conclusion of such six (6) month period,
the employment of the Executive hereunder may be terminated by the Company or
the Executive, upon thirty (30) days' notice to the other. In the event of such
termination, the Company shall (a) within ten (10) business days after such
termination, pay to the Executive the Base Salary (at the annual rate then in
effect) accrued to the date of such termination and not theretofore paid and (b)
pay to the Executive any Bonuses which are then or shall thereafter become
payable under Section 3.

         6.3. DUE CAUSE. The employment of the Executive hereunder may be
terminated by the Company at any time for Due Cause (as hereinafter defined). In
the event of such termination, the Company shall pay to the Executive within ten
(10) business days after the date of such termination the Base Salary (at the
annual rate then in effect) accrued to the date of such termination and not
theretofore paid to the Executive. The Company shall also pay to the Executive
any Bonus which is then or shall thereafter become payable to the Executive
under Section 3. For purposes hereof, "Due Cause" shall mean (i) willful, gross
neglect or willful, gross misconduct in the Executive's discharge of his duties
and responsibilities under this Agreement, or (ii) the Executive's conviction of
a felony; provided, however, that the Executive shall be given written notice by
a majority of the Board of Directors of the Company that it intends to terminate
the Executive's employment for Due Cause, which written notice shall specify the
act or acts upon which the majority of the Board of Directors of the Company
intends so to terminate the Executive's employment, and the Executive shall then
be given the opportunity, within fifteen (15) days of his receipt of such
notice, to have a meeting with the Board of Directors of the Company to discuss
such act or acts. If the basis of such written notice is other than an act or
acts described in clause (ii), the Executive shall be given seven (7) days after
such meeting within which to cease or correct the performance (or
nonperformance) giving rise to such written notice and, upon failure of the
Executive within such seven (7) days to cease or correct such performance (or
nonperformance), the Executive's employment by the Company shall automatically
be deemed terminated hereunder for Due Cause.

         6.4. TERMINATION BY THE COMPANY WITHOUT CAUSE. The Company may
terminate the Executive's employment at any time for whatever reason it deems
appropriate or without reason; provided, however, that in the event that such
termination is not pursuant to Section 6.1 (Death), 6.2 (Disability), 6.3 (Due
Cause), 6.5 (Voluntary Termination), 6.6 (Constructive Termination) or 6.7
(Termination Following a Change in Control), such

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termination shall be considered a Termination Without Cause and, in such case,
the Company shall pay to the Executive within ten (10) business days of the date
of Termination Without Cause: (i) the Base Salary (at the annual rate then in
effect) accrued to the date of termination and not theretofore paid to the
Executive; and (ii) severance pay, in the form of a lump sum equal to one (1)
year of Executive's Base Salary (at the annual rate then in effect).

         In addition, the Company shall pay to the Executive any Bonuses which
are then or shall thereafter become payable pursuant to Section 3.

         6.5. VOLUNTARY TERMINATION. The Executive, for any reason, may
terminate his employment with the Company at any time upon sixty (60) days'
prior written notice to the Company. In the event of such termination (unless
such termination is within one year following a Change in Control of the
Company, in which case the provisions of Section 6.7 hereof shall be
applicable), the Company shall pay to the Executive within ten (10) days after
the date of such termination the Base Salary (at the annual rate then in effect)
accrued to the date of such termination and not theretofore paid to the
Executive. The Company shall also pay to the Executive any Bonuses which are
then or shall thereafter become payable pursuant to Section 3.

         6.6. CONSTRUCTIVE TERMINATION. Anything herein to the contrary
notwithstanding, if the Company:

                  (A) demotes the Executive to a position lesser than Chief
         Executive Officer;

                  (B) causes a material change in the nature or scope of the
         authorities, powers, functions, duties, or responsibilities of the
         Executive as described in Section 2;

                  (C) decreases the Executive's base salary or eliminates health
         insurance coverage for the Executive;

                  (D) by vote of its Board of Directors or shareholders
         determines to liquidate the Company and 90 days from such determination
         has elapsed; or

                  (E) without limiting the generality or effect of the
         foregoing, materially breaches an obligation or covenant of this
         Agreement, the Note or the Indemnification Agreement between the
         Company and the Executive dated May 5, 2000 (the "Indemnification
         Agreement")

then, within thirty (30) days after receiving written notice of such action (or
inaction) or within thirty (30) days of learning of such action (or inaction),
whichever is later, the Executive may advise the Company in writing that the
action (or inaction) constitutes a termination of his employment by the Company
(other than for Due Cause), in which event the Company shall have thirty (30)
days (the "Correction Period") in which to correct such action (or inaction). If
the Company does not correct such action (or inaction) during the Correction
Period, such action (or inaction) shall constitute a termination of the
Executive's employment by the Company pursuant to Section 6.4 (Without Cause)
effective on the first business day following the end of the Correction Period.

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         6.7. TERMINATION OF EMPLOYMENT FOLLOWING A CHANGE IN CONTROL. Anything
herein to the contrary notwithstanding, the Executive may terminate his
employment with the Company during the one (1) year period following a Change in
Control, and such termination shall constitute a termination of the Executive's
employment by the Company pursuant to Section 6.4 (Without Cause). For purposes
of this Agreement, a Change in Control of the Company shall be deemed to have
occurred if:

                  (A) a "person" (meaning an individual, a partnership, or other
         group or association as defined in Sections 13(d) and 14(d) of the
         Securities Exchange Act of 1934, as amended (the "`34 Act")), other
         than the Executive, either (i) acquires beneficial ownership of thirty
         percent (30%) or more of the combined voting power of the outstanding
         securities of the Company having a right to vote in elections of
         directors and such acquisition shall not have been approved within
         sixty (60) days following such acquisition by a majority of the
         Continuing Directors (as hereinafter defined) then in office or (ii)
         acquires beneficial ownership of fifty percent (50%) or more of the
         combined voting power of the outstanding securities of the Company
         having a right to vote in elections of directors; or

                  (B) Continuing Directors shall for any reason cease to
         constitute a majority of the Board of Directors of the Company; or

                  (C) all or substantially all of the business and/or assets of
         the Company are disposed of by the Company to a party or parties other
         than a subsidiary or other affiliate of the Company (other than
         factoring the Company's current receivables or escrows due), in which
         the Company owns less than a majority of the stock entitled to vote for
         the election of directors, pursuant to a partial or complete
         liquidation of the Company, sale of assets (including stock of a
         subsidiary of the Company) or otherwise.

         For purposes of this Agreement (a) "Continuing Director" shall mean a
member of the Board of Directors of the Company who either was a member of the
Board of Directors on the Employment Date or who subsequently became a Director
and whose election, or nomination for election, was approved by a vote of at
least two-thirds of the Continuing Directors then in office, and (b) "beneficial
ownership" shall be determined pursuant to Rule 13d-3 of the `34 Act.

         6.8. ACCELERATION OF PAYMENTS. In the event that the Company shall fail
to pay to the Executive any amount payable pursuant to this Section 6 at the
time such payment is due (after written notice and thirty (30) business days
period to cure), all amounts to be paid to the Executive (or his estate or legal
representative) pursuant to this Section 6, Section 3 and any other provision of
this Agreement, shall become immediately due and payable without any further
action by the Executive (or his estate or legal representative).

         6.9. NO MITIGATION. In the event the Executive's employment is
terminated for any reason whatever, the Executive shall be under no obligation
to seek other employment and

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shall be under no obligation to offset any amounts earned from such other
employment (whether as an employee, a consultant or otherwise) against any
payments received hereunder.

         6.10. BENEFIT PLANS. In the event that the Executive's employment is
terminated for any reason whatever, all rights and benefits of the Executive and
his transferee, as applicable, under the Benefit Plans, shall be determined in
accordance therewith.

         6.11. EXPENSES. In the event the Executive's employment is terminated
for any reason whatever, the Company shall pay to the Executive within 10 days
after the date of such termination any expenses for which the Executive is due
for reimbursement pursuant to the terms of the Agreement.

         7. SECTION 16 OF THE `34 ACT. The Company agrees to take all actions
necessary to provide that the issuance and conversion of the Note is exempt
under Section 16 of the `34 Act.

         8. CONFIDENTIAL INFORMATION.

         8.1. NONDISCLOSURE. The Executive shall, during the term of his
employment and at all times thereafter, treat as confidential and, except as
required in the performance of his duties and responsibilities under this
Agreement (as determined by the Executive in good faith) and except pursuant to
legal process, not disclose, publish or otherwise make available to the public
or to any individual, firm or corporation any confidential information (as
hereinafter defined).

         8.2. CONFIDENTIAL INFORMATION DEFINED. For the purposes hereof, the
term "confidential information" shall mean all information acquired by the
Executive in the course of the Executive's employment with the Company in any
way concerning the products, projects, activities, business or affairs of the
Company or the Company's customers, including, without limitation, all
information concerning trade secrets and the products or projects of the Company
and/or any improvements therein, all sales and financial information concerning
the Company, all customer and supplier lists, all information concerning
projects in research and development or marketing plans for any such products or
projects, and all information in any way concerning the products, projects,
activities, business or affairs of customers of the Company which is furnished
to the Executive by the Company or any of its agents or customers, as such;
provided, however, that the term "confidential information" shall not include
information which (a) becomes generally available to the public other than as a
result of a disclosure by the Executive, (b) was available to the Executive on a
non-confidential basis prior to his employment with the Company or (c) becomes
available to the Executive on a non-confidential basis from a source other than
the Company or any of its agents or customers provided that such source is not
bound by a confidentiality agreement with the Company or any of such agents or
customers.

         9. EQUITABLE RELIEF. In the event of a breach or threatened breach by
the Executive of any of the provisions of Section 8 of this Agreement, the
Executive hereby consents and agrees that the Company shall be entitled to an
injunction or similar equitable relief from any court of competent jurisdiction
restraining the Executive from committing or continuing any such breach or
threatened breach or granting specific performance of any act required to be

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performed by the Executive under any of such provisions, without the necessity
of showing any actual damage or that money damages would not afford an adequate
remedy and without the necessity of posting any bond or other security. Nothing
herein shall be construed as prohibiting the Company from pursuing any other
remedies at law or in equity which it may have.

         10. REPRESENTATIONS, WARRANTIES AND PROMISES OF THE COMPANY. The
Company represents and warrants to, and agrees with, the Executive as follows:

                  (i) The Company has been duly incorporated and is validly
         existing as a corporation in good standing under the laws of the State
         of Delaware.

                  (ii) The Company has duly authorized the execution and
         delivery of this Agreement and the issuance and delivery of the Note,
         and this Agreement and the Note constitute valid and legally binding
         agreements of the Company enforceable in accordance with their terms,
         except as such enforceability may be limited by bankruptcy, insolvency,
         or other laws affecting generally the enforceability of creditors'
         rights and by limitations on the availability of equitable remedies.
         The shares issuable upon conversion of the Note (the "Underlying
         Shares"), when issued and delivered in accordance with the Note, shall
         have been duly issued and shall be validly outstanding, fully paid and
         non-assessable shares of the Company's common stock, par value $0.01
         per share (the "Common Stock"). The Underlying Shares have been
         reserved for issuance by the Company.

                  (iii) Concurrently with or prior to the execution of this
         Agreement the Company has amended its Bylaws to provide that the
         President of the Company is also its Chief Executive Officer.

         10.2. REPRESENTATIONS, WARRANTIES, AND AGREEMENTS OF THE EXECUTIVE. The
Executive hereby represents and warrants to, and agrees with, the Company as
follows:

                  (i) The Executive is sufficiently experienced in financial and
         business matters to be capable of evaluating the merits and risks of
         this investment. The Executive has the financial capability for making
         the investment.

                  (ii) Prior to the execution hereof, the Executive has had the
         opportunity to ask questions of and receive answers from
         representatives of the Company concerning the finances, operations,
         business and prospects of the Company.

                  (iii) The Executive is acquiring the Note and the Underlying
         Shares for his own account for the purpose of investment and not with a
         view to, or for resale in connection with, the distribution thereof,
         nor with any present intention of distributing the Note or the
         Underlying Shares. The Executive understands that the Note and the
         Underlying Shares have

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         not been registered under the Securities Act of 1933, as amended (the
         "Securities Act") or under any applicable state securities laws, that
         the Note and the Underlying Shares may not be transferred except in
         compliance with such laws, and that the Company may affix legends on
         the note and the Underlying Shares with respect to such restrictions.

         11. REGISTRATION.

         11.1. REGISTRATION REQUESTS. Subject to the provisions of Section
11.15, the Company shall, upon the written request of the Executive (a
"Registration Request"), use reasonable efforts to file and cause to become
effective with the Securities and Exchange Commission (the "Commission"), as
soon as practicable but in no event later than sixty (60) days following receipt
of such request, a registration statement on the appropriate registration form
of the Commission (i) as shall be selected by the Company and as shall be
reasonably acceptable to the Executive, and (ii) as shall permit the resale of
some or all of the Underlying Shares in accordance with the intended method or
methods of disposition specified in the Registration Request, whether pursuant
to a delayed offering pursuant to Rule 415 under the Securities Act or otherwise
(each, a "Registration Statement"); provided, however, that the Executive shall
be entitled to only two (2) such Registration Request pursuant to this Section
11.1. Any Registration Request shall specify the number of Underlying Shares
proposed to be sold by the Executive as well as the intended method of
disposition thereof. A request for registration of Underlying Shares shall not
be considered a Registration Requests pursuant hereto unless (i) a Registration
Statement has been declared effective by the Commission, or (ii) a Registration
Statement is filed with the Commission but (A) is not declared effective as a
result of any action or inaction on the part of the Executive, or (B) is later
withdrawn at the request of the Executive. The Executive may reacquire the right
to a Registration Request lost pursuant to the previous sentence if the
Executive reimburses the Company for any and all expenses associated with such
failed registration. The Company's obligations under this Section 11.1 shall
terminate at such time as (x) the Underlying Shares beneficially owned by the
Executive consist of less than one percent (1%) of the issued and outstanding
shares of the Company and (y) the Executive has held the Note for a period of at
least one (1) year.

         11.2. PIGGYBACK REGISTRATION. If the Company proposes to file a
registration statement under the Securities Act with respect to an offering of
Common Stock for its own account or for the account of any individual,
partnership, corporation, limited liability company, joint venture, association,
joint stock company, trust, unincorporated organization, government or agency or
political subdivision thereof (each a "Person"), other than a registration
statement on Form S-4 or S-8, (or any substitute form or rule, respectively,
that may be adopted by the Commission), the Company shall give written notice of
such proposed filing to the Executive at the address set forth in Section 17
hereof as soon as reasonably practicable (but in no event less than 15 days
before the anticipated filing date), undertaking to provide the Executive the
opportunity to register on the same terms and conditions such number of
Underlying Shares as the Executive may request (a "Piggyback Registration"). The
Executive will have seven business days after receipt of any such notice to
notify the Company as to whether he wishes to participate in a Piggyback
Registration (which notice shall not be deemed to be a Registration Request);
provided that should the Executive fail to provide timely notice to the Company,
the Executive will forfeit any rights to participate in the Piggyback
Registration. In the event that

                                       11
<PAGE>   12

the registration statement is filed on behalf of a Person other than the
Company, the Company will use its reasonable best efforts to have the number of
Underlying Shares that the Executive wishes to sell included in the Registration
Statement. If the Company or the Person for whose account such offering is being
made shall determine in its sole discretion not to register or to delay the
proposed offering, the Company may, at its election, provide written notice of
such determination to the Executive and (i) in the case of a determination not
to effect the proposed offering, shall thereupon be relieved of the obligation
to register such Underlying Shares in connection therewith, and (ii) in the case
of a determination to delay a proposed offering, shall thereupon be permitted to
delay registering such Underlying Shares for the same period as the delay in
respect of the proposed offering. As between the Company and the Executive, the
Company shall be entitled to select the underwriters in connection with any
Piggyback Registration. Notwithstanding the foregoing, if the underwriters
advise the Company that such underwriters cannot purchase the number of shares
of Common Stock that all Persons desire to sell in an offering pursuant to this
Section 11.2, priority shall be given to the shares of Common Stock being sold
by the Company or other Person on whose account the offering is being made.

         11.3. PROSPECTUS DELIVERY. The Company shall as expeditiously as
possible furnish to the Executive such reasonable numbers of copies of any
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as the Executive
may reasonably request in order to facilitate the public sale or other
disposition of the Underlying Shares pursuant to this Section 11.

         11.4. BLUE SKY. The Company shall use its best efforts to register or
qualify the Underlying Shares covered by any Registration Statement under the
securities or Blue Sky laws of such states as the Executive shall reasonably
request, and do any and all other acts and things that may be necessary or
desirable to enable the Executive to consummate the public sale or other
disposition in such states of the Underlying Shares; provided, however, that the
Company shall not be required in connection with this Section 11.4 to qualify as
a foreign corporation or execute a general consent to service of process in any
jurisdiction.

         11.5. AMENDMENTS; SUPPLEMENTS. If the Company has delivered preliminary
or final prospectuses to the Executive and after having done so the prospectus
is amended or supplemented or required to be amended or supplemented to comply
with the requirements of the Securities Act, it shall promptly notify the
Executive and, if requested, the Executive shall immediately cease making offers
of Underlying Shares and return all prospectuses to the Company, other than file
copies. The Company shall promptly provide the Executive with amended or
supplemented prospectuses and, following receipt of the amended or supplemented
prospectuses, the Executive shall be free to resume making offers of the
Underlying Shares.

         11.6. COMPANY RECORDS. The Company shall make available for inspection
by the Executive and any attorney, accountant or other agent retained by the
Executive, all financial and other records, pertinent corporate documents and
properties of the Company, and cause the Company's officers, directors,
employees and independent accountants to supply all information reasonably
requested by any such attorney, accountant or agent in connection with such
Registration Statement.

                                       12
<PAGE>   13

         11.7. COMMISSION RULES. The Company shall comply with all applicable
rules and regulations of the Commission, and make available to its security
holders, as soon as reasonably practicable, an earnings statement covering the
period of at least twelve months beginning with the first day of the Company's
first full calendar quarter after the effective date of the Registration
Statement, which earnings statement shall satisfy the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder.

         11.8. EXECUTIVE AS UNDERWRITER. If the Executive in his reasonable
judgment determines that he might be deemed to be an underwriter or a
controlling person of the Company, the Company shall permit the Executive to
participate in the preparation of any registration or comparable statement filed
pursuant herewith and to require the insertion therein of material in form and
substance satisfactory to the Executive and to the Company and furnished to the
Company in writing, which in the reasonable judgment of the Executive and his
counsel determine should be included.

         11.9. STOP ORDERS. The Company shall as expeditiously as possible
notify the Executive of the threat of issuance by the Commission of any stop
order suspending the effectiveness of any Registration Statement or the
initiation of any proceeding for that purpose, and make every reasonable effort
to prevent the entry of any order suspending the effectiveness of any
Registration Statement. In the event of the issuance of any stop order
suspending the effectiveness of any Registration Statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any Underlying Shares included in such Registration Statement
for sale in any jurisdiction, the Company will use its reasonable best efforts
promptly to obtain the withdrawal of such order.

         11.10. OPINIONS OF COUNSEL. At each closing of an underwritten
offering, the Company shall request opinions of counsel to the Company and
updates thereof (which opinions and updates shall be reasonably satisfactory to
the underwriters of the Underlying Shares being sold) addressed to the
underwriters covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably requested by
such sellers or their counsel.

         11.11. LISTING OF SHARES. The Company shall use its reasonable best
efforts to cause all Underlying Shares to be listed on each securities exchange
on which securities of the same class issued by the Company are then listed and
use its reasonable best efforts to qualify such Underlying Shares for trading on
each system on which securities of the same class issued by the Company are then
qualified.

         11.12. EXPENSES. Except as provided elsewhere in this Agreement, the
Company will pay all Registration Expenses for the registration of Underlying
Shares with the Commission as required under this Agreement. For purposes of
this Section, the term "Registration Expenses" shall mean all expenses incurred
by the Company in complying with this Agreement, including, without limitation,
all registration and filing fees, exchange listing fees, printing expenses, fees
and disbursements of counsel for the Company, state Blue Sky fees and expenses,
and the expense of any special audits incident to or required by any such
registration, but excluding underwriting discounts and selling commissions.

                                       13
<PAGE>   14

         11.13. INDEMNIFICATION BY COMPANY. The Company shall provide customary
indemnification to the Executive for any liability that may be incurred by the
Executive as the result of any misstatement or omission in the Registration
Statement, except insofar as such liability may arise from information provided
in writing by the Executive in his capacity as a selling stockholder under a
Registration Statement.

         11.14. INDEMNIFICATION BY EXECUTIVE. The Executive shall provide
indemnification to the Company to the same extent as the foregoing indemnity,
but only with reference to information provided in writing by the Executive in
his capacity as a selling stockholder under a Registration Statement.

         11.15. SUSPENSION OF REGISTRATION. The obligations of the Company under
this Section 11 are subject to the condition that the Company shall be entitled
to require the Executive to suspend for up to ninety (90) days once in any
twelve month period the sale of Underlying Shares pursuant to a Registration
Statement (or, if applicable, defer the filing of a Registration Statement) if
and for so long as (i) the Board determines in its reasonable judgment that the
sale of Underlying Shares pursuant thereto would materially interfere with any
material financing, acquisition, corporate reorganization or other material
transaction by the Company and (ii) the Company promptly gives the Executive
written notice of such determination. The Company shall have no obligation to
maintain the effectiveness of, or file, a Registration Statement with respect to
Underlying Shares during periods when the Executive is required to suspend the
sale of such Underlying Shares as provided in this Section 11.15. As soon as
possible after the expiration of such period, the Company shall perform all acts
necessary to permit the Executive to sell Underlying Shares pursuant to a
Registration Statement.

         12. SUCCESSORS AND ASSIGNS.

         12.1. ASSIGNMENT BY THE COMPANY. The Company shall require any
successors (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company to assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform if no such
succession had taken place. As used in this Agreement, the "Company" shall mean
the Company as hereinbefore defined and any successor to its business and/or
assets as aforesaid which otherwise becomes bound by all the terms and
provisions of this Agreement by operation of law and this Agreement shall be
binding upon, and inure to the benefit of, the Company, as so defined.

         12.2. ASSIGNMENT BY THE EXECUTIVE. The Executive may not assign this
Agreement or any part thereof without the prior written consent of a majority of
the Board of Directors of the Company; provided, however, that nothing herein
shall preclude one or more beneficiaries of the Executive from receiving any
amount that may be payable following the occurrence of his legal incompetence or
his death and shall not preclude the legal representative of his estate from
receiving such amount or from assigning any right hereunder to the person or
persons entitled thereto under his will or, in the case of intestacy, to the
person or persons entitled thereto under the laws of intestacy applicable to his
estate. The term "Beneficiaries", as used in this Agreement, shall mean a
beneficiary or beneficiaries so designated to receive any

                                       14
<PAGE>   15

such amount or, if no beneficiary has been so designated, the legal
representative of the Executive (in the event of his incompetence) or the
Executive's estate.

         13. GOVERNING LAW. This Agreement shall be deemed a contract made
under, and for all purposes shall be construed in accordance with, the laws of
the State of Delaware. In the event that a court of any jurisdiction shall hold
any of the provisions of this Agreement to be wholly or partially unenforceable
for any reason, such determination shall not bar or in any way affect the
Company's right to relief as provided for herein in the courts of any other
jurisdiction. Such provisions, as they relate to each jurisdiction, are, for
this purpose, severable into diverse and independent covenants. Service of
process on the parties hereto at the addresses set forth herein shall be deemed
adequate service of such process.

         14. ENTIRE AGREEMENT. This Agreement, together with the Indemnification
Agreement and then Note, contains all the understandings and representations
between the parties hereto pertaining to the subject matter hereof and
supersedes all undertakings and agreements, whether oral or in writing, if any
there be, previously entered into by them with respect thereto. The Original
Employment Agreement is superseded in its entirety by this Agreement and is no
longer of any force and effect. The Stock Purchase Agreement and the Option
Agreement, each by and between the Company and the Executive and dated as of May
5, 2000, also are no longer of any force and effect.

         15. AMENDMENT, MODIFICATION, WAIVER. No provision of this Agreement may
be amended or modified unless such amendment or modification is agreed to in
writing and signed by the Executive and by a duly authorized representative of
the Company other than the Executive. Except as otherwise specifically provided
in this Agreement, no waiver by either party hereto of any breach by the other
party hereto of any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of a similar or dissimilar provision
or condition at the same or any prior or subsequent time, nor shall the failure
of or delay by either party hereto in exercising any right, power or privilege
hereunder operate as a waiver thereof to preclude any other or further exercise
thereof or the exercise of any other such right, power or privilege.

         16. ARBITRATION. Any dispute or controversy arising under, out of, or
in connection with or relation to this Agreement shall, at the election and upon
written demand of either the Executive or the Company, be finally determined and
settled by arbitration in the city of the Company's headquarters in accordance
with the rules and procedures of the American Arbitration Association, and
judgment upon the award may be entered in any court having jurisdiction thereof.
Any fees, costs or expenses incurred by Executive in connection with any such
arbitration shall be paid by the Company, as such fees, costs or expenses are
incurred, within 10 days after receipt by the Company of invoices or other
reasonable documentation evidencing such fees, costs or expenses; provided,
however, that all such fees, costs or expenses shall be reimbursed to the
Company if the finder of fact determines that the Company is the prevailing
party in such arbitration.

         17. NOTICES. Any notice to be given hereunder shall be in writing and
delivered personally or sent by certified mail, postage prepaid, return receipt
requested,

                                       15
<PAGE>   16

addressed to the party concerned at the address indicated below or at such other
address as such party may subsequently designate by like notice:

          If to the Company:

                 NAHC, Inc.
                 1018 West Ninth Avenue
                 King of Prussia, Pennsylvania  19406
                 Attention:  President, with a copy to the Chairman of the Board

                 with an additional copy to:

                 James Giddens, Esq.
                 Hughes, Hubbard & Reed
                 Battery Park Plaza
                 New York, NY 10004-1482

          If to the Executive:

                 David R. Burt
                 259 Granville Lane
                 North Andover, MA 01845
                 with one copy sent to davburt@msn.com

          With a copy to:

                 Michael D. Wortley
                 Vinson & Elkins L.L.P.
                 3700 Trammell Crow Center
                 2001 Ross Avenue
                 Dallas, TX  75201

         18. SEVERABILITY. Should any provision of this Agreement be held by a
court or arbitration panel of competent jurisdiction to be enforceable only if
modified, such holding shall not affect the validity of the remainder of this
Agreement, the balance of which shall continue to be binding upon the parties
hereto with any such modification to become a part hereof and treated as though
originally set forth in this Agreement. The parties further agree that any such
court or arbitration panel is expressly authorized to modify any such
unenforceable provision of this Agreement in lieu of severing such unenforceable
provision from this Agreement in its entirety, whether by rewriting the
offending provision, deleting any or all of the offending provision, adding
additional language to this Agreement, or by making such other modifications as
it deems warranted to carry out the intent and agreement of the parties as
embodied herein to the maximum extent permitted by law. The parties expressly
agree that this Agreement as so modified by the court or arbitration panel shall
be binding upon and enforceable against each of them. In any event, should one
or more of the provisions of this Agreement be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions hereof, and if such provision or
provisions

                                       16
<PAGE>   17

are not modified as provided above, this Agreement shall be construed as if such
invalid, illegal or unenforceable provisions had never been set forth herein.

         19. SURVIVORSHIP. The respective rights and obligations of the parties
hereunder shall survive any termination of the Executive's employment to the
extent necessary to the intended preservation of such rights and obligations.

         20. HEADINGS. Headings of the sections and paragraphs of this Agreement
are intended solely for convenience and no provision of this Agreement is to be
construed by reference to the title of any section or paragraph.

         21. COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument.

                [Remainder of this page left blank intentionally]

                                       17
<PAGE>   18

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

                                          NAHC, INC.

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

                                          By
                                             ----------------------------------
                                              David R. Burt

The foregoing Agreement has been
Approved by the Compensation Committee
of the Board of Directors:

----------------------------------
Stephen E. O'Neil
Chairman of Compensation Committee

                                       18<PAGE>   1
                                                               Exhibit 10(k)(ii)

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY APPLICABLE STATE SECURITIES
LAWS, AND MAY ONLY BE OFFERED FOR SALE, SOLD, PLEDGED, TRANSFERRED, OR OTHERWISE
DISPOSED OF IN COMPLIANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND THE
RULES AND REGULATIONS THEREUNDER, OR OF ANY APPLICABLE STATE SECURITIES LAWS AND
THE RULES AND REGULATIONS THEREUNDER.

Payee: David R. Burt                              Principal Amount: $60,000.00

NAHC, Inc.
10% Convertible Subordinated Note

1.       Principal; Payments.

         NAHC, Inc., a Delaware corporation (the "Company"), for value received,
         hereby promises to pay to the order of David R. Burt ("Payee") the
         principal amount of $60,000.00, together with all accrued and unpaid
         interest thereon, on the earlier to occur of demand thereof by a person
         entitled to payment hereunder or May 1, 2006 (the "Due Date") unless
         before such date this Note shall have been prepaid, converted or
         repurchased as provided for below and in the Provisions (hereinafter
         defined), at the principal offices of the Company, 1018 West Ninth
         Avenue, King of Prussia, Pennsylvania 19406.

2.       Note Terms and Provisions.

         This Note (the "Note") is issued under and subject to the provisions of
         the Note Terms and Provisions dated as of September 27, 2000 (the
         "Provisions") and attached hereto as Annex A. The Provisions are
         incorporated by reference as if set forth herein. The Note is a general
         unsecured obligation of the Company.

3.       Interest.

         The Company promises to pay interest on the Stated Value (as defined in
         the Provisions) of this Note at the rate of 10% per annum (not on a
         compound basis). The accrued interest on this Note shall be due and
         payable quarterly, commencing September 30, 2002, and on each December
         31, March 31, June 30, and September 30 thereafter (or, if any such
         date is a Legal Holiday as defined in the Provisions, then such accrued
         interest shall be payable on the next succeeding day which is not a
         Legal Holiday) (each, an "Interest Payment Date") until this Note is
         paid in full or has been converted or repurchased as provided for below
         and in the Provisions. Interest on this Note will accrue from the most
         recent date to which interest has been paid or, if no interest has been
         paid, from its date of issuance. Interest will be computed on the basis
         of a 360-day year of twelve 30-day months.

<PAGE>   2

4.       Method of Payment.

         The Company will pay accrued and unpaid interest on this Note to the
         Payee on each Interest Payment Date. In addition, the outstanding
         principal amount together with all accrued and unpaid interest shall be
         paid on the Due Date. The Company will pay principal and interest on
         this Note in lawful money of the United States of America or by its
         check payable in such money. Unless other arrangements are made, the
         principal and interest payments will be paid by check mailed to the
         persons in whose name this Note is registered in the note register, at
         their respective registered addresses. The Paying Agent (as defined in
         the Provisions) may mail any interest or principal check to a
         registered holder's address.

5.       Prepayment.

         The principal of this Note may not be prepaid without the express
         written consent of the registered holder. All interest accrued on this
         Note shall be paid through the date of any such prepayment.

6.       Conversion.

         This Note shall be convertible into the Company's common stock, par
         value $0.01 per share, according to the terms set forth in Article 5 of
         the Provisions, or such other securities, cash or property as provided
         in Section 5.08 of the Provisions.

7.       Subordination.

         This Note is subordinated to the Senior Debt (as defined in the
         Provisions). To the extent provided in the Provisions, Senior Debt must
         be paid before this note may be paid. By accepting this Note, the
         registered holder agrees to such subordination and authorizes the
         Company to give effect to the same.

8.       Persons Deemed Owners.

         Payee or any subsequent holder may be treated as the owner of this Note
         for all purposes. The Company and Payee agree that Payee may transfer
         all or any portion of this Note to (A) his spouse, former spouse,
         children, stepchildren, grandchildren, parents, stepparents,
         grandparents, siblings, nieces, nephews, mother-in-law, father-in-law,
         sons-in-law, daughters-in-law, brothers-in-law, or sisters-in-law,
         including adoptive relationships, or any other person sharing Payee's
         household (other than a tenant or employee) (collectively, "Immediate
         Family Members"), (B) a trust or trusts in which such Immediate Family
         Members have more than fifty percent of the beneficial interest, (C) a
         foundation in which such Immediate Family Members (or Payee) control
         the management of assets, or (D) any other entity in which such
         Immediate Family Members (or Payee) beneficially own more than fifty
         percent of the voting interests; provided, that there may be no
         consideration paid for any such transfer.

                                       2
<PAGE>   3

9.       Unclaimed Money.

         If money for the payment of principal or interest on this Note remains
         unclaimed for two years, the Paying Agent, if any, will pay the money
         back to the Company at its request. After that, the holder entitled to
         the money must look to the Company for payment unless an applicable
         abandoned property law designates another person.

10.      No Recourse Against Others.

         A director, officer, employee or stockholder, as such, of the Company
         will not have any liability for any obligations of the Company under
         this Note or the Provisions, or for any claim based on, in respect of,
         or by reason of, such obligations or their creation. By accepting this
         Note, Payee and any subsequent holder waive and release all such
         liability. The foregoing waiver and release are part of the
         consideration for the issue of this Note.

11.      Maximum Interest Rate.

         It is the intention of the holder hereof to conform strictly to
         applicable usury laws now or hereafter in force, and therefore all
         agreements between the holder and the Company are expressly limited so
         that in no contingency or event whatsoever, whether by reason of
         advancement of the proceeds hereof, acceleration of the maturity of the
         unpaid principal balance hereof, or otherwise, shall the amount paid or
         agreed to be paid to the holder hereof, for the use, forbearance, or
         detention of the money to be advanced hereunder exceed the highest
         lawful rate permitted under the laws of the State of Delaware.
         Regardless of any provision contained herein, or in any other document
         or instrument executed in connection herewith, the holder shall never
         be entitled to receive, collect, or apply, as interest hereon, any
         amount in excess of the Highest Lawful Rate (as hereinafter defined)
         and in the event the holder ever receives, collects, or applies, as
         interest, any such excess, such amount which would be excessive
         interest shall be deemed a partial prepayment of principal and treated
         hereunder as such; and, if the principal hereof is paid in full, any
         remaining excess shall be refunded to the Company. In determining
         whether or not the interest paid or payable, under any specific
         contingency, exceeds the Highest Lawful Rate, the holder and the
         Company 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) amortize, prorate, allocate and spread the
         total amount of interest throughout the entire contemplated term
         hereof, provided that if the indebtedness evidenced hereby is paid and
         performed in full prior to the end of the entire contemplated term of
         this Note, and if the interest received for the actual period of
         existence thereof exceeds the Highest Lawful Rate, the holder shall
         either apply or refund to the Company the amount of such excess as
         herein provided, and, in such event, the holder shall not be subject to
         any penalties provided by any laws for contracting for, charging, or
         receiving interest in excess of the Highest Lawful Rate.

         As used herein, the term "Highest Lawful Rate" means the maximum
         nonusurious interest rate, if any, that at any time or from time to
         time may be contracted for, taken,

                                       3
<PAGE>   4

         reserved, charged, or received on the indebtedness evidenced hereby
         under the laws of the State of Delaware applicable thereto which are
         presently in effect or, to the extent allowed by law, under such
         applicable laws of the State of Delaware which may hereafter be in
         effect and which allow a higher maximum nonusurious interest rate than
         applicable laws now allow, in any case after taking into account, to
         the extent required by applicable law, any and all relevant payments or
         charges hereunder.

12.      Abbreviations.

         Customary abbreviations may be used in the name of a registered holder,
         such as : TEN COM (= tenants in common), TEN ENT (= tenants by the
         entireties), JT TEN (= joint tenants with right of survivorship and not
         as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
         to Minors Act).

         In witness whereof, the Company has caused this Note to be signed in
its name by its president or one of its vice presidents and to be attested by
its secretary or one of its assistant secretaries, as of the 27th day of
September, 2000

                                              NAHC, INC.

                                              By: _____________________________
                                              [NAME]
                                              [TITLE]

                                       4
<PAGE>   5

                                     ANNEX A

                            NOTE TERMS AND PROVISIONS

         The Note Terms and Provisions (the "Provisions") of the 10% convertible
subordinated note, dated as of September 27, 2000, issued by NAHC, Inc., a
Delaware corporation, to the Holders (hereinafter defined) are as follows:

                                   ARTICLE ONE

                   DEFINITIONS AND INCORPORATION BY REFERENCE

         Section 1.01 Definitions.

         "Affiliate" means a Person, firm, corporation, partnership, limited
liability company or other entity controlling, controlled by, or under common
control with another Person, firm, corporation, partnership, limited liability
company or other entity.

         "Balance Sheet Equity" shall mean (i) the amount listed on the total
shareholders' equity line of the balance sheet contained in the Company's most
recent quarterly or year-end filing pursuant to Section 13 of the Exchange Act
or any audited financial statement, minus (ii) $5,000,000.

         "Board of Directors" means the Board of Directors of the Company.

         "Common Stock" shall mean the common stock, par value $0.01, of the
Company.

         "Company" means NAHC, Inc., a Delaware corporation, until a successor
replaces it and thereafter means the successor.

         "Conversion Price" for any Note initially shall mean $0.04 and, subject
to adjustment as set forth in Article 5 of these Provisions, shall range from
$0.04 to $0.0025 as follows: (i) if the Balance Sheet Equity is less than $3.5
million and the Market Price is less than $0.036 per share, the Conversion Price
shall be $0.04; (ii) if the Balance Sheet Equity is at least $3.5 million but
less than $4.0 million or the Market Price is at least $0.036 but less than
$0.040 per share, the Conversion Price shall be $0.035; (iii) if the Balance
Sheet Equity is at least $4 million but less than $4.5 million or the Market
Price is at least $0.040 but less than $0.046 per share, the Conversion Price
shall be $0.03; (iv) if the Balance Sheet Equity is at least $4.5 million but
less than $5.0 million or the Market Price is at least $0.046 but less than
$0.050 per share, the Conversion Price shall be $0.02; (v) if the Balance Sheet
Equity is at least $5 million but less than $5.5 million or the Market Price is
at least $0.05 but less than $0.056 per share, the Conversion Price shall be
$0.01; (vi) if the Balance Sheet Equity is at least $5.5 million but less than
$6.0 million or the Market Price is at least $0.056 but less than $0.060 per
share, the Conversion Price shall be $0.005; and (vii) if the Balance Sheet
Equity is equal to or greater than $6 million or the Market Price is equal to or
greater than $0.06 per share, in each case with respect to the Market Price, for
any period of at least twenty consecutive trading days, the

                                      A-1
<PAGE>   6

Conversion Price shall be $0.0025; provided; that if the foregoing results in
the possibility of two alternative Conversion Prices, the lower of such
alternatives shall be the Conversion Price. Anything herein to the contrary
notwithstanding, but subject to the adjustment provisions of Article 5 hereof,
at such time that the Conversion Price is reduced to $0.0025 (as such Conversion
Price may be adjusted pursuant to Article 5 hereof) it shall be fixed and no
longer subject to change, regardless of subsequent changes to the Balance Sheet
Equity or the Market Price (a "Conversion Price Setting"). If the Conversion
Price is adjusted pursuant to Article 5 then the Market Price per share set
forth in this definition shall also be adjusted in proportion to the Conversion
Price and rounded to the nearest $0.0001. For purposes of determining the
Conversion Price, the Balance Sheet Equity shall be determined as of the close
of business on the business day immediately preceding any date of determination
of the Conversion Price.

         "Default" means any event which is, or after notice or passage of time
would be, an Event of Default (hereinafter defined).

         "Due Date" shall mean the earlier to occur of demand for payment in
full of all amounts due outstanding under a Note by a Holder of such Note, or
May 1, 2006.

         "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

         "Holder" means the Person or Persons in whose name or names a Note is
registered on the Registrar's books.

         "Majority in Interest" shall mean the Holder or the Holders of more
than 50% of the Stated Value of the Note or Notes at the time in question.

         "Market Price" shall mean (a) in the case of Common Stock listed or
admitted to trading on any securities exchange registered under the Exchange
Act, the closing price, regular way, on such day, or if no sale takes place on
such day, the average of the closing bid and asked prices on such day, (b) in
the case of Common Stock not listed or admitted for trading on any such
securities exchange, the last reported sale price on such day, or if no sale
takes place on such day, the last price reported by a reputable quotation source
designated by the Company, (c) in the case of Common Stock not then listed or
admitted for trading on any such securities exchange and as to which no such
reported sale or price bid and asked prices are available, the average of the
reported high bid and low asked prices on such day, as reported by a reputable
quotation service, or a newspaper of general circulation in the Borough of
Manhattan, City and State of New York, customarily published on each business
day, designated by the Company, or if there shall be no bid and asked prices on
such day, the average of the high bid and low asked prices, as so reported, on
the most recent day (not more than 30 days prior to the date in question) for
which prices have been so reported, and (d) in the case of Common Stock not
listed and for which there are no reported bid and asked prices, the price as
determined in good faith by the Board of Directors.

         "Note" or "Notes" means any 10% convertible subordinated note or notes
of the Company that are issued under these Provisions.

                                      A-2
<PAGE>   7

         "Officer" means the Chairman of the Board, the President, any Vice
President, the Treasurer or the Secretary of the Company.

         "Person" shall mean any individual, Company, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.

         "Provisions" means these Note Terms and Provisions dated as of
September 15, 2000, as amended or supplemented from time to time.

         "Repurchase Price" shall have the meaning set forth in Section 11.01
hereof.

         "Repurchase Right" shall have the meaning set forth in Section 11.01
hereof.

         "Securities Act" shall mean the Securities Act of 1933, as amended.

         "Stated Value" shall mean, at any time, the outstanding principal of
any Note, plus all accrued and unpaid interest thereon; provided, that if the
Company shall rightfully exercise its Repurchase Right pursuant to Section 11.01
hereof and then and thereafter no Default or Event of Default has occurred, the
Stated Value shall be the Repurchase Price.

         "Subsidiary" shall mean any Person of which the Company owns, directly
or indirectly, more than 50% of (i) the voting securities, other voting
ownership or voting partnership interests, or (ii) if there are no such voting
interests, the total equity interests.

         Section 1.02 Other Definitions.

                  Term                               Defined in Section
                  ----                               ------------------

         "Bankruptcy Law"                                     6.01
         "Custodian"                                          6.01
         "Event of Default"                                   6.01
         "Legal Holiday"                                     10.04
         "Paying Agent"                                       2.03
         "Registrar"                                          2.03
         "Senior Debt"                                        9.01

         Section 1.03 Rules of Construction. Unless the context otherwise
requires:

(1)      a term has the meaning assigned to it:

(2)      an accounting term not otherwise defined has the meaning assigned to it
         in accordance with generally accepted accounting principles, applied on
         a consistent basis, set forth in Opinions of the Accounting Principles
         Board of American Institute of Certified Public Accountants and/or in
         statements of the Financial Accounting Standards Board which are
         applicable in the circumstances as of the

                                      A-3
<PAGE>   8

         date in question; and the requirement that such principles be applied
         on a consistent basis means that the accounting principles in a current
         period are comparable in all material respects to those applied in a
         preceding period; and

(3)      words in the singular include the plural, and in the plural include the
         singular.

                                   ARTICLE TWO

                                 THE SECURITIES

         Section 2.01 Form and Dating. Any Note may have notations, legends or
endorsements required by law, stock exchange rule or usage. The Company shall
approve the form of Note and any notation, legend or endorsement thereon. Each
Note shall be dated the date of its authentication.

         Section 2.02. Execution. An Officer shall sign each Note for the
Company by original or facsimile signature. The Company's seal may be reproduced
on each Note.

         Section 2.03. Registrar and Paying Agent. The Company shall maintain an
office where each Note may be presented for registration of transfer or for
exchange ("Registrar") and an office where each Note may be presented for
payment ("Paying Agent"). The Company shall keep a register of the Notes and of
their transfer and exchange. The Company may have one or more co-registrars, one
or more paying agents and one or more conversion agents.

         The Company will initially act as Registrar, Paying Agent and
Conversion Agent.

         Section 2.04 Debt Security Holder Lists. The Company shall preserve in
as current a form as is reasonably practicable the most recent list available to
it of the names and addresses of Holders.

         Section 2.05 Transfer and Exchange. When a Note is presented to the
Company with a request to register a transfer of such Note or any portion
thereof, the Company shall register the transfer as requested if the
requirements of Section 8-401(a) of the Delaware Uniform Commercial Code, as
amended, are met. To permit transfers, the Company shall authenticate any Note
at the Holder's request. The Company may charge the Holder requesting such
transfer a reasonable fee for any transfer or exchange but not for any exchange
pursuant to Section 8.03 hereof.

         Section 2.06 Replacement Notes. If a Holder claims that a Note has been
lost, destroyed or wrongfully taken, the Company shall issue and authenticate a
replacement Note if the requirements of Section 8-405 of the Delaware Business
and Commerce Code, as amended, are met. An indemnity bond must be sufficient in
the judgment of the Company to protect the Company from any loss which it may
suffer if a Note is replaced. The Company may charge such Holder for its
expenses in replacing a Note pursuant to this Section 2.06.

                                      A-4
<PAGE>   9

         Section 2.07 Outstanding Notes. Notes outstanding at any time are all
Notes authenticated by the Company except for those cancelled by it and those
described in this Section. A Note does not cease to be outstanding because the
Company or one of its Affiliates holds the Note.

         If a Note is replaced pursuant to Section 2.06, it ceases to be
outstanding unless the Company receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.

         If the Paying Agent holds on the Due Date money sufficient to pay any
Notes payable on that date, then on and after that date such Notes cease to be
outstanding and interest on them ceases to accrue.

         Section 2.08 Cancellation. The Company and no one else shall cancel and
destroy any Notes surrendered for transfer, payment, or cancellation.

                                  ARTICLE THREE

                                   PREPAYMENT

         Section 3.01 No Right of Prepayment. The principal amount of a Note may
not be prepaid, in whole or in part, without the written consent of the Holder
thereof. All interest accrued on such Note shall be paid through the date of any
such prepayment.

                                  ARTICLE FOUR

                                    COVENANTS

         Section 4.01 Payment of Securities. The Company shall pay the principal
of and interest on any Note on the date and in the manner provided in such Note
unless paid earlier in accordance with Article Three.

                                  ARTICLE FIVE

                                   CONVERSION

         Section 5.01 Conversion Right. Holders shall have the right,
exercisable at any time, to convert any Note or any portion thereof into a
number of shares of Common Stock (calculated as to each conversion to the
nearest 1/100th of a share) determined by dividing the Stated Value of the Note
held by such Holder by the Conversion Price then in effect.

         Section 5.02 Surrender of Notes. In order to exercise the conversion
right, the Holder of a Note or any portion thereof to be converted shall
surrender such Note, duly endorsed or assigned to the Company or in blank, at
the office of the Paying Agent and shall give written notice to the Company in
the form set forth on Exhibit A attached hereto that such Holder elects to
convert such Note or a portion thereof. Such notice shall also state the name or
names (with

                                      A-5
<PAGE>   10

address) in which the certificate or certificates for the shares of Common Stock
which shall be issuable upon such conversion shall be issued, and shall be
accompanied by funds in an amount sufficient to pay any transfer or similar tax
required by the provisions of Section 5.05 below. Each Note surrendered for
conversion shall, unless the shares issuable on conversion are to be issued in
the same name as the name in which such Note is registered, be duly endorsed by,
or be accompanied by instruments of transfer (in each case, in form reasonably
satisfactory to the Company), duly executed by the Holder or such Holder's duly
authorized attorney-in-fact.

         Section 5.03. Issue of Common Stock Upon Conversion. As promptly as
practicable after the surrender of a Note for conversion and the receipt of such
notice and funds, if any, as aforesaid (but in no event more than 10 business
days thereafter), the Company shall issue and shall deliver to such Holder, or
on such Holder's written order, a certificate or certificates for the number of
shares of Common Stock issuable upon the conversion of such Note in accordance
with the provisions of this Article 5, and a check or cash in respect of any
fractional interest in respect of a share of Common Stock arising upon such
conversion, as provided in Section 5.04 below. Each conversion with respect to
any Note shall be deemed to have been effected immediately prior to the close of
business on the date on which the Note shall have been surrendered and such
notice shall have been received by the Company as aforesaid, and the person or
persons entitled to receive the Common Stock issuable upon such conversion shall
be deemed for all purposes to be the record holder or holders of such Common
Stock upon that date. If any Note is only partially converted, then upon
delivery of a certificate of Common Stock, the Company will also deliver a
replacement Note for any unconverted principal amount.

         Section 5.04. No Fractional Shares. No fractional shares of Common
Stock or scrip representing fractional shares shall be issued upon conversion of
a Note. Instead of any fractional share of Common Stock otherwise issuable upon
conversion of any Note, the Corporation shall pay a cash adjustment in respect
to such fraction in an amount equal to the same fraction of the Market Price of
the Common Stock at the close of business on the day of conversion.

         Section 5.05. Taxes. If a Holder converts a Note, the Company shall pay
any and all documentary, stamp or similar issue or transfer tax payable in
respect of the issue or delivery of such Note (or any other securities issued on
account thereof pursuant hereto) or Common Stock upon the conversion; provided,
however, the Company shall not be required to pay any such tax that may be
payable because any such shares are issued in a name other than the name of the
Holder.

         Section 5.06. Reservation of Shares. The Company shall reserve out of
its authorized but unissued Common Stock or its Common Stock held in treasury
enough shares of Common Stock to permit the conversion of the aggregate Stated
Value of the Notes. The Company shall from time to time, in accordance with the
Delaware General Corporation Law, increase the authorized amount of its Common
Stock if at any time the authorized amount of its Common Stock remaining
unissued shall not be sufficient to permit the conversion of the aggregate
Stated Value of the Notes at the time outstanding. If any shares of Common Stock
required to be reserved for issuance upon conversion of Notes hereunder require
registration with or approval of any governmental authority under any federal or
state law before the shares may be issued

                                      A-6
<PAGE>   11

upon conversion, the Company shall in good faith and as expeditiously as
possible endeavor to cause the shares to be so registered or approved. All
shares of Common Stock delivered upon conversion of Notes will, upon delivery,
be duly authorized and validly issued, fully paid and nonassessable, free from
all taxes, liens and charges with respect to the issue thereof.

         Section 5.07. Adjustment of Conversion Price. The Conversion Price
shall be subject to adjustment from time to time as follows:

         (a) In the event that the Company shall (A) pay a dividend or make a
distribution on its Common Stock in shares of its Common Stock, (B) split or
subdivide its outstanding Common Stock into a greater number of shares, (C)
combine its outstanding Common Stock into a smaller number of shares or (D)
issue any shares of capital stock other than Common Stock by reclassification of
its Common Stock, the Conversion Price in effect immediately prior thereto shall
be adjusted so that the Holder of any Note thereafter surrendered for conversion
shall be entitled to receive the number of shares of Common Stock or other
securities of the Company that such Holder would have owned or have been
entitled to receive after the occurrence of any of the events described above
had such Note been converted immediately prior to the occurrence of such event.
An adjustment made pursuant to this Section 5.07(a) shall become effective
immediately after the close of business on the record date in the case of a
dividend or distribution (except as provided in Section 5.11 below) and shall
become effective immediately after the close of business on the effective date
in the case of a subdivision, split, combination or reclassification. Any shares
of Common Stock issuable in payment of a dividend shall be deemed to have been
issued immediately prior to the close of business on the record date for such
dividend for purposes of calculating the number of outstanding shares of Common
Stock under clauses (b) and (c) below.

         (b) In the event that the Company shall commit to issue or distribute
Common Stock (excluding dividends or distributions described in subsection (a)
above) or issue rights, warrants or options entitling the holder thereof to
subscribe for or purchase Common Stock at a price per share less than the Market
Price per share on the earliest of (i) the date the Company shall enter into a
firm contract for such issuance or distribution, (ii) the record date for the
determination of stockholders entitled to receive any such rights, warrants or
options, if applicable, or (iii) the date of actual issuance or distribution of
any such Common Stock or rights, warrants or options (provided that the issuance
of Common Stock upon the exercise of warrants or options will not cause an
adjustment in the Conversion Price if no such adjustment would have been
required at the time such warrant or option was issued), then the Conversion
Price in effect immediately prior to such earliest date shall be adjusted so
that the Conversion Price shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to such earliest date by a fraction
whose numerator shall be the number of shares of Common Stock outstanding on
such date plus the number of shares which the aggregate offering price of the
total number of shares so offered would purchase at such Market Price (such
amount, with respect to any such rights, warrants or options, determined by
multiplying the total number of shares subject thereto by the exercise price of
such rights, warrants or options and dividing the product so obtained by the
Market Price), and of which the denominator shall be the number of shares of
Common Stock outstanding on such date plus the number of additional shares of
Common Stock to be issued or distributed or receivable upon exercise of any such
warrant, right or option.

                                      A-7
<PAGE>   12

         Such adjustment shall be made successively whenever any such Common
Stock, rights, warrants or options are issued or distributed at a price below
the Market Price therefor as in effect on the date of issuance or distribution.
In determining whether any rights, warrants or options entitle the holders to
subscribe for or purchase shares of Common Stock at less than such Market Price,
and in determining the aggregate offering price of shares of Common Stock so
issued or distributed, there shall be taken into account any consideration
received by the Company for such Common Stock, rights, warrants or options, the
value of such consideration, if other than cash, to be determined in good faith
by the Board of Directors. If any right, warrant or option to purchase Common
Stock, the issuance of which resulted in an adjustment in the Conversion Price
pursuant to this subsection (b), shall expire and shall not have been exercised,
the Conversion Price shall immediately upon such expiration be recomputed to the
Conversion Price which would have been in effect had the adjustment of the
Conversion Price made upon the issuance of such right, warrant or option been
made on the basis of offering, subscription or purchase only of that number of
shares of Common Stock actually purchased upon the actual exercise of such
right, warrant or option.

         (c) In the event that the Company shall pay as a dividend or other
distribution to holders of any class of its Common Stock generally or to holders
of any class of capital stock of any subsidiary which is not wholly owned by the
Company evidences of indebtedness or assets (including, without limitation,
shares of capital stock, cash or other securities, but excluding dividends,
rights, warrants, options and distributions for which adjustment is made as
described in subsections (a) and (b) above), then in each such case the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the date of such distribution by a fraction of which the numerator shall be the
Market Price on the record date mentioned below less the fair market value on
such record date (as determined in good faith by the Board of Directors) of the
portion of the capital stock or assets or evidences of indebtedness so
distributed or of such rights or warrants attributable to one share of Common
Stock (the amount so attributable equaling the aggregate fair market value of
such indebtedness or assets, as so determined by the Board of Directors, divided
by the number of shares of Common Stock outstanding on such record date), and
the denominator shall be the Market Price. Such adjustment shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such distribution, except as provided in
Section 5.11 below.

         (d) No adjustment in the Conversion Price shall be required unless the
adjustment would require an increase or decrease of at least 1% in the
Conversion Price then in effect; provided, however, that any adjustments that by
reason of this Section 5.07(d) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 5.07(d) shall be made to the nearest 1/100th of a cent or
nearest 1/1000th of a share.

         (e) Notwithstanding anything to the contrary set forth in this Section
5.07, no adjustment shall be made to the Conversion Price upon the issuance of
shares of Common Stock pursuant to any compensation or incentive plan for
officers, directors, employees or consultants of the Company which plan has been
approved by the Compensation Committee of the Board of

                                      A-8
<PAGE>   13

Directors (or if there is no such committee then serving, by the majority vote
of the Directors then serving who are not employees or officers of the
Corporation, a 5% or greater stockholder of the Company or an officer, employee
or Affiliate of any such 5% or greater stockholder) and, if required by law, the
requisite vote of the stockholders of the Company (unless the exercise price
thereof is changed after the date hereof other than solely by operation of the
anti-dilution provisions thereof or by the Compensation Committee of the Board
of Directors or, if applicable, the Board of Directors and, if required by law,
the stockholders of the Corporation as provided herein).

         (f) In the event that, at any time as a result of an adjustment made
pursuant to Sections 5.07(a) through 5.07(c) above, the Holder of any Note
thereafter surrendered for conversion shall become entitled to receive any
shares of the Company other than shares of the Common Stock, thereafter the
number of such other shares so receivable upon conversion of any Note shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in Sections 5.07(a) through 5.07(e) above, and the other provisions of
this Section 5.07(g) with respect to the Common Stock shall apply on like terms
to any such other shares.

         Section 5.08. Merger; Consolidation; Transfer of Assets. In case of any
reclassification of the Common Stock (other than in a transaction to which
Section 5.07(a) applies), any consolidation of the Company with, or merger of
the Corporation into, any other entity, any merger of another entity into the
Company (other than a merger that does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock of
the Company), any sale or transfer of all or substantially all of the assets of
the Company or any compulsory share exchange, pursuant to which share exchange
the Common Stock is converted into other securities, cash or other property,
then lawful provision shall be made as part of the terms of such transaction
whereby the Holder of a Note then outstanding shall have the right thereafter,
during the period such Note shall be convertible, to convert such Note only into
the kind and amount of securities, cash and other property receivable upon the
reclassification, consolidation, merger, sale, transfer or share exchange by a
holder of the number of shares of Common Stock of the Company into which such
Note might have been converted immediately prior to the reclassification,
consolidation, merger, sale, transfer or share exchange. As a condition to any
such transaction, the Company, the Person formed by the consolidation or
resulting from the merger or which acquires such assets or which acquires the
Company's shares, as the case may be, shall make provisions in its certificate
or articles of incorporation or other constituent document to establish such
right. The certificate or articles of incorporation or other constituent
document shall provide for adjustments which, for events subsequent to the
effective date of the certificate or articles of incorporation or other
constituent document, shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article 5. The provisions of this Section 5.08
shall similarly apply to successive reclassifications, consolidations, mergers,
sales, transfers or share exchanges.

         Section 5.09. Notice to Holders If:

         (a) the Company shall take any action which would require an adjustment
in the Conversion Price pursuant to Section 5.07; or

                                      A-9
<PAGE>   14

         (b) the Company shall authorize the granting to the holders of its
Common Stock generally of rights or warrants to subscribe for or purchase any
shares of any class or any other rights or warrants; or

         (c) there shall be any reclassification or change of the Common Stock
(other than a subdivision or combination of its outstanding Common Stock or a
change in par value) or any consolidation, merger or statutory share exchange to
which the Company is a party and for which approval of any stockholders of the
Company is required, or the sale or transfer of all or substantially all of the
assets of the Company; or

         (d) there shall be a voluntary or involuntary dissolution, liquidation
or winding up of the Company;

then, the Company shall cause to be filed with the Paying Agent and shall cause
to be mailed to the Holders at their addresses as shown on the books of the
Paying Agent, as promptly as possible, but at least 30 days prior to the
applicable date hereinafter specified, a notice stating (A) the date on which a
record is to be taken for the purpose of such dividend, distribution or granting
of rights or warrants, or, if a record is not to be taken, the date as of which
the holders of Common Stock of record to be entitled to such dividend,
distribution or rights or warrants are to be determined or (B) the date on which
such reclassification, change, consolidation, merger, statutory share exchange,
sale, transfer, dissolution, liquidation or winding up is expected to become
effective or occur, and the date as of which it is expected that holders of
Common Stock of record shall be entitled to exchange their shares of Common
Stock for securities or other property deliverable upon such reclassification,
change, consolidation, merger, statutory share exchange, sale, transfer,
dissolution, liquidation or winding up. Failure to give such notice or any
defect therein shall not affect the legality or validity of the proceedings
described in this Section 5.09.

         Section 5.10. Filing of Certificate with Paying Agent. Whenever the
Conversion Price is adjusted as herein provided, the Company shall promptly file
with the Paying Agent a certificate of an officer of the Company setting forth
the Conversion Price after the adjustment and setting forth a brief statement of
the facts requiring such adjustment and a computation thereof. The Company shall
promptly cause a notice of the adjusted Conversion Price to be mailed to each
Holder of a Note.

         Section 5.11. Deferral of Share Issuance. In any case in which Section
5.07 provides that an adjustment shall become effective immediately after a
record date of an event and the date fixed for such adjustment pursuant to
Section 5.07 occurs after such record date but before the occurrence of such
event, the Company may defer until the actual occurrence of such event (i)
issuing to the Holder of any Note converted after such record date and before
the occurrence of such event the additional shares of Common Stock issuable upon
such conversion by reason of the adjustment required by such event over and
above the Common Stock issuable upon such conversion before giving effect to
such adjustment and (ii) paying to such Holder any amount in cash in lieu of any
fractional share pursuant to Section 5.04.

                                      A-10
<PAGE>   15

         Section 5.12. Other Actions by Company. In case the Company shall take
any action affecting the Common Stock, other than actions described in this
Article 5, which in the opinion of the Board of Directors would materially
adversely affect the conversion right of the Holders, the Conversion Price may
be adjusted, to the extent permitted by law, in such manner, if any, and at such
time, as the Board of Directors may determine to be equitable in the
circumstances; provided, however, that in no such event shall the Board of
Directors be required to take any such action.

         Section 5.13 Listing of Shares. The Company will endeavor to list the
shares of Common Stock required to be delivered upon conversion of any Note,
prior to delivery, upon each national securities exchange, the Nasdaq National
Market or any similar system of automated dissemination of securities prices, if
any, upon which the Common Stock is listed at the time of delivery.

                                   ARTICLE SIX

                              DEFAULTS AND REMEDIES

         Section 6.01 Events of Default. An "Event of Default" occurs if:

         (1)      the Company defaults in the payment of interest on any Note
                  when the same becomes due and payable and the default
                  continues for a period of 10 days;

         (2)      the Company defaults in the payment of the principal of any
                  Note when the same becomes due and payable;

         (3)      the Company fails to comply with any of its other agreements
                  related to any Note or these Provisions and the default
                  continues for a period of 30 days following notice to the
                  Company of such default;

         (4)      the liquidation of the Company other than pursuant to
                  subsection (6) hereof below;

         (5)      the Company pursuant to or within the meaning of any
                  Bankruptcy Law (hereinafter defined);

                  (A)      files a voluntary petition for an order for relief,

                  (B)      consents to the entry of an order for relief against
                           it in an involuntary case,

                  (C)      consents to the appointment of a Custodian
                           (hereinafter defined) of it or for all or
                           substantially all of its property, or

                  (D)      makes a general assignment for the benefit of its
                           creditors; or

                                      A-11
<PAGE>   16

         (6)      a court of competent jurisdiction enters an order or decree
                  under any Bankruptcy Law that:

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

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

                  (C)      orders the liquidation of the Company,

                  and the order or decree remains unstayed and in effect for 90
                  days.

         The term "Bankruptcy Law" means the Bankruptcy Code of the United
States, as amended, and all other applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief laws from time to time in effect affecting the rights
of creditors generally. The term "Custodian" means any receiver, trustee,
assignee, liquidator or similar official under any Bankruptcy Law.

         Section 6.02 Acceleration. If an Event of Default (other than an Event
of Default under clauses (1) or (2) of Section 6.01) occurs and is continuing,
the Conversion Price shall automatically become $0.0025 (or such lower amount as
adjusted pursuant to Article Five hereof), and the holders of a Majority in
Interest by notice to the Company may declare the principal of and accrued and
unpaid interest on all Notes to be due and payable immediately. Upon such a
declaration such principal and interest shall be due and payable immediately.
The Holders of a Majority in Interest by notice to the Company may rescind an
acceleration of payment if the rescission would not conflict with any judgment
or decree.

         Section 6.03 Other Remedies. Subject to the other provisions of this
Article Six, if an Event of Default occurs and is continuing, the Holders may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal or interest on the Notes or to enforce the performance of
any provision of the Notes or these Provisions.

         A delay or omission by any Holder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.

         Section 6.04 Waiver of Existing Event of Default. Subject to Section
8.02, the Holders of a Majority in Interest by notice to the Company may waive
an existing Event of Default and its consequences. When an Event of Default is
waived, it is cured and ceases.

         Section 6.05 Control by Majority. The Holders of a Majority in Interest
may direct the time, method and place of conducting any proceeding for any
remedy available to the Holders.

                                      A-12
<PAGE>   17

         Section 6.06 Limitation on Suits. A Holder may not pursue any remedy
with respect to these Provisions or the Notes unless the Holder gives the
Company written notice of a continuing Event of Default.

         A Holder may not use these Provisions to prejudice the rights of
another Holder or to obtain a preference or priority over any other Holder.

         Section 6.07 Rights of Holders to Receive Payment. Subject to the
procedures specified in this Article 6, the right of any Holder to receive
payment of principal and interest on any Note, on or after the respective due
dates expressed in such Note, or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of the Holder, and the right of any Holder to bring suit for
the enforcement of his right to convert the Note shall not be impaired or
affected without the consent of the Holder.

         Section 6.08 Priorities. If the Holders collect any money pursuant to
this Article, they shall pay out the money in the following order:

         First: to all Holders to the extent required by Article 9;

         Second: to Holders for amounts due and unpaid on the Notes for
         principal and interest, ratably, without preference or priority of any
         kind, according to the amounts due and payable on the Notes for
         principal and interest, respectively; and

         Third: to the Company.

         Section 6.09 Undertaking for Costs. In any suit for the enforcement of
any right or remedy under these provisions or in any suit against the Company
for any action taken or omitted by it, a court in its discretion may require the
filing by any party litigant in the suit of an undertaking to pay the costs of
the suit, and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by Holders of a Majority in
Interest.

                                  ARTICLE SEVEN

                             DISCHARGE OF PROVISIONS

         Section 7.01 Termination of Company's Obligations. All obligations of
the Company under any Note and these Provisions will be discharged when all the
principal of and the interest on all of the Notes have been paid or the Notes
have been converted as provided in Article 5.

                                      A-13
<PAGE>   18

                                  ARTICLE EIGHT

                       AMENDMENTS, SUPPLEMENTS AND WAIVERS

         Section 8.01. With Consent of Holders. The Company may amend or
supplement these Provisions or any Note without notice to any Holder but with
the written consent of the Holders of a Majority in Interest. The Holders of a
Majority in Interest may waive compliance by the Company with any provision of
these Provisions or any Note without notice to any Holder. However, without the
consent of each Holder affected, an amendment, supplement or waiver, including a
waiver pursuant to Section 6.04, may not:

         (1)      reduce the outstanding principal amount or Stated Value of
                  Notes whose Holders must consent to an amendment, supplement
                  or waiver;

         (2)      reduce the rate of or extend the time for payment of interest
                  on any Note;

         (3)      reduce the principal of or extend the fixed maturity of any
                  Note; or

         (4)      waive a default in the payment of the principal of or interest
                  on any Note.

         Section 8.02 Revocation and Effect of Consents. A consent to an
amendment, supplement or waiver by a Holder shall bind the Holder and every
subsequent holder of any instrument that evidences the same debt or portion
thereof as the consenting Holder's Note, even if notation of the consent is not
made on such instrument. However, any such Holder or subsequent Holder may
revoke the consent as to his Note if the Company receives the notice of
revocation before the date the amendment, supplement or waiver becomes
effective.

         After an amendment, supplement or waiver becomes effective, it shall
bind every Holder unless it makes a change described in any of clauses (1)
through (4) of Section 8.01. In that case the amendment, supplement or waiver
shall bind each Holder who has consented to it and every subsequent holder of
any instrument that evidences the same debt or portion thereof as the consenting
Holder's Notes.

         Section 8.03 Notation on or Exchange of Notes. If an amendment,
supplement or waiver changes the terms of a Note, the Company may require the
Holder to deliver the Note to the Company. The Company may place an appropriate
notation on such Note about the changed terms and return it to the Holder.
Alternatively, if the Company so determines, the Company in exchange for such
Note shall issue and authenticate a new Note that reflects the changed terms.

         Section 8.04 Company to Sign Amendments. The Company may not sign an
amendment or supplement to the terms of these Provisions or any Note until the
Board of Directors approves it.

         Section 8.05 Bank Consent Required. Notwithstanding any other
provision, the Company may not amend or supplement Article 9 without the written
consent of the holder(s) of at least two-thirds of the principal amount of
Senior Debt.

                                      A-14
<PAGE>   19

                                  ARTICLE NINE

                                  SUBORDINATION

         Section 9.01 Notes Subordinated to Senior Debt. The Company agrees, and
each Holder by his acceptance of a Note likewise agrees, that the payment of the
principal of and interest on any Note is subordinated, to the extent and in the
manner provided in this Article, to the prior payment in full of all Senior
Debt.

         "Senior Debt" means (i) all indebtedness for money borrowed by the
Company and all amounts payable (including fees, expenses, indemnification and
penalties) under any documents or instruments evidencing or facilitating such
indebtedness, whether outstanding on the date of any Note or thereafter created
or incurred; and (ii) all renewals, extensions or refundings of any such
obligation or indebtedness described in clause (i). The term Senior Debt does
not include (i) any indebtedness for money borrowed by the Company if by the
terms of the instrument creating such debt it is not superior in right of
payment to any Note; or (ii) any account payable, purchase money indebtedness
(indebtedness issued or assumed by the Company as all or part of the
consideration for the acquisition of property), or other indebtedness (other
than indebtedness for borrowed money described above) created or assumed by the
Company in the ordinary course of business in connection with the obtaining of
materials or services.

         This Article shall constitute a continuing offer to all persons who, in
reliance upon such provisions, become holders of, or continue to hold, Senior
Debt, and such provisions are made for the benefit of the holders of Senior
Debt, and such holders are made obligees hereunder and they and/or each of them
may enforce such provisions.

         Section 9.02 Company Not to Make Payments with Respect to Notes in
Certain Circumstances.

         (a) Upon the maturity of any Senior Debt by lapses of time,
acceleration or otherwise, all amounts due thereon shall first be paid in full,
or such payment duly provided for in cash or in a manner satisfactory to the
holders of such Senior Debt, before any payment is made on account of the
principal or interest on any Note or to acquire any Note.

         (b) Upon the happening of an event of default with respect to any
Senior Debt (as such event of default is defined therein or in the instrument
under which it is outstanding) permitting the holders to accelerate the maturity
thereof followed by any written notice of such event of default required by the
documents evidencing such Senior Debt being given to the Company by the holders
of such Senior Debt or their representative, no payment shall be made by the
Company with respect to the principal or interest on any Note or to acquire any
Note unless and until such event of default shall have been cured or waived or
shall have ceased to exist.

         Section 9.03 Notes Subordinated to Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of Company. Upon any distribution of
assets or securities of the

                                      A-15
<PAGE>   20

Company (other than shares of stock or subordinated indebtedness provided by a
plan of reorganization or readjustment which does not alter the rights of
holders of Senior Debt) upon any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or otherwise):

         (a) the holders of all Senior Debt shall first be entitled to receive
payment in full of all amounts due thereon before the Holders are entitled to
receive any payment on account of the principal of and/or interest on any Note.

         (b) any payment or distributions of assets of the Company of any kind
or character, whether in cash, property or securities (other than shares of
stock or subordinated indebtedness provided by a plan of reorganization or
readjustment which does not alter the rights of holders of Senior Debt), to
which the Holders would be entitled on account of principal or interest on the
Notes except for the provisions of this Article 9, shall be paid by the
liquidating trustee or agent or other person making such payment or distribution
directly to the holders of Senior Debt or their representative, or to the
trustee under any indenture or other agreement (if any) under which Senior Debt
may have been issued, to the extent necessary to make payment in full of all
Senior Debt remaining unpaid, after giving effect to any concurrent payment or
distribution or provision therefor to the holders of such Senior Debt; and

         (c) in the event that notwithstanding the foregoing provisions of this
Section 9.03, any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities (other than shares of
stock or subordinated indebtedness provided by the plan of reorganization or
readjustment which does not alter the rights of holders of Senior Debt), shall
be received by the Holders on account of principal or interest on any Note
before all Senior Debt is paid in full, such payment (subject to the applicable
provisions of Section 9.06) shall be received and held in trust for and shall be
paid over to the holders of the Senior Debt remaining unpaid or unprovided for
or their representative, or to the trustee under any indenture or other
agreement (if any) under which Senior Debt may have been issued, for application
to the payment of such Senior Debt until all such Senior Debt shall have been
paid in full, after giving effect to any concurrent payment or distribution or
provision therefor to the holders of such Senior Debt.

         The Company shall give prompt written notice to the holders of Senior
Debt of any dissolution, winding up, liquidation or reorganization of the
Company.

         Section 9.04 Holders of Notes to be Subrogated to Right of Holders of
Senior Debt. In the event the Holders receive payments or distributions and are
required to turn over such payments or distributions to the holders of the
Senior Debt, the Holders shall be subrogated to the rights of the holders of
Senior Debt to receive payments or distributions of assets of the Company
applicable to the Senior Debt until all amounts owing on the Notes shall be paid
in full; provided, however, that in no event shall this provision affect the
right of the holders of Senior Debt.

                                      A-16
<PAGE>   21

         Section 9.05 Obligation of the Company Unconditional. Nothing contained
in this Article 9 or elsewhere in these Provisions or in any Note is intended to
or shall impair, as between the Company and the Holders, the obligation of the
Company, which is absolute and unconditional, to pay to the Holders the
principal of, and interest on, the Notes as and when the same shall become due
and payable in accordance with their terms, or is intended to or shall affect
the relative rights of the Holders and creditors of the Company other than the
holders of the Senior Debt, nor shall anything herein or therein prevent the
Holder of any Note from exercising all remedies otherwise permitted by
applicable law upon default under these Provisions, subject to the rights, if
any, under this Article 9 of the holders of Senior Debt in respect of cash,
property or securities of the Company received upon the exercise of any such
remedy. Upon any distribution of assets of the Company referred to in this
Article 9, the Holders shall be entitled to rely upon any order or decree made
by any court of competent jurisdiction in which such dissolution, winding up,
liquidation or reorganization proceedings are pending, or a certificate of the
liquidating trustee or agent or other person making any distribution to the
Holders, for the purpose of ascertaining the persons entitled to participate in
such distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article 9.

         Article 9.06 Holders Entitled to Assume Payments Not Prohibited in
Absence of Notice. Subject to the rights of the holders of Senior Debt to
enforce subordination under this Article 9, the Holders shall not at any time be
charged with knowledge of the existence of any facts that would prohibit the
making of any payment by the Company, unless and until the Holders shall have
received written notice thereof from the Company or from one or more holders of
Senior Debt or from any trustee therefor; and, prior to the receipt of any such
written notice, the Holders shall be entitled to assume conclusively that no
such facts exist.

         Article 9.07 Subordination Rights Not Impaired by Acts or Omissions of
Company or Holders of Senior Debt. No right of any present or future holders of
any Senior Debt to enforce subordination as provided herein shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any good faith act or failure to act on the part of any such
holder, or by any noncompliance by the Company with the terms of these
Provisions, regardless of any knowledge thereof which any such holder may have
or be otherwise charged with.

         Article 9.08 Article 9 Not to Prevent Events of Default. The failure to
make a payment on account of principal or interest by reason of any provision in
this Article 9 shall not be construed as preventing the occurrence of an Event
of Default under Section 6.01

                                   ARTICLE TEN

                                  MISCELLANEOUS

         Section 10.01 Notices. Any notice or communication by any Holder to the
Company shall be sufficiently given if in writing and delivered in person or
mailed by certified or registered mail, return receipt requested, addressed as
follows:

                                      A-17
<PAGE>   22

                  NAHC, Inc.
                  1018 West Ninth Avenue
                  King of Prussia, Pennsylvania  19406

         The Company by notice to the Holders may designate additional or
different addresses for subsequent notices or communications.

         Any notice or communication mailed to a Holder shall be mailed to him
by certified or registered mail, return receipt requested, at his address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.

         Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provide above, it shall be deemed to
have been given on the third business day following its mailing, whether or not
the addressee receives it.

         Section 10.02 Communications by Holders with Other Holders. Any Holder
may communicate with other Holders with respect to their rights under these
Provisions or any Note and the Company shall provide a list of the Holders to
any Holder who so requests in writing.

         Section 10.03 When Treasury Securities Disregarded. In determining
whether the Holders of the required amount of Stated Value have concurred in any
direction, waiver or consent, any Note owned by the Company or a Subsidiary
shall be disregarded.

         Section 10.04 Legal Holiday. A "Legal Holiday" is a Saturday, a Sunday,
a legal holiday or a day on which national banking institutions in the
Commonwealth of Pennsylvania are not required to be open. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.

         Section 10.05 Governing Law. The laws of the State of Delaware shall
govern these Provisions and the Notes.

         Section 10.06 Beneficiaries; No Adverse Interpretation of Other
Agreements. These Provisions are not intended to be for the benefit of, or to
give any rights to enforce these Provisions or otherwise to, any person or
entity other than the Company, the Holders, and the holders of Senior Debt.
These Provisions may not be used to interpret any indenture, loan or debt
agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret these Provisions.

         Section 10.07 Successors. All agreements of the Company in these
Provisions and any Note shall bind the Company's successors. All agreements of
the Holders in these Provisions shall bind their successors and personal
representatives.

                                      A-18
<PAGE>   23

                                 ARTICLE ELEVEN

                                REPURCHASE RIGHT

         Section 11.01 Company Right of Repurchase. Any provision in these
Provisions to the contrary notwithstanding, in the event that the employment of
David R. Burt (the "Executive") with the Company is terminated before September
30, 2002 pursuant to Sections 6.3 or 6.5 of that certain Amended and Restated
Employment Agreement, dated of even date herewith, by and between the Company
and the Executive (the "Employment Agreement"), then the Company shall have the
right (the "Repurchase Right"), subject to Section 11.02 below, to repurchase
any Note at a price (the "Repurchase Price") equal to the sum of (i) the product
of (a) the amount determined by dividing the outstanding principal amount of
such Note by twenty four (24), multiplied by (b) the number of full calendar
months that the Executive was employed by the Company following the date of the
Employment Agreement and prior to the date of termination (the "Elapsed
Months"), plus (ii) ten percent (10%) of the amount determined in clause (i)
multiplied by a fraction, the numerator of which is the Elapsed Months and the
denominator of which is twelve (12); provided, that the provisions of this
Section 11.01 shall not apply in the event that a Conversion Price Setting has
occurred prior to the date of such termination of the Executive. The Company may
exercise its Repurchase Right with respect to any Note by delivering written
notice as set forth in Section 10.01 of these Provisions to the Holder of such
Note within ten (10) days after the date of such termination of the Executive
(the "Repurchase Notice"). Closing on the repurchase of any Note pursuant to
this Section 11.01 shall occur no later than five (5) business days following
receipt by the Holder of the Repurchase Notice. Upon payment of the Repurchase
Price, the Note being repurchased shall be delivered to the Company by the
Holder.

         Section 11.02 Conversion, Demand and Default. After receipt by a Holder
of a Repurchase Notice as set forth in Section 11.01, but prior to closing on
the repurchase of the applicable Note, the Holder thereof shall have the right
to convert the Note for shares of Common Stock pursuant to the terms of Article
5 hereof. After receipt by a Holder of a Repurchase Notice as set forth in
Section 11.01, the Holder agrees not to demand payment of the applicable Note
unless a Default or an Event of Default occurs after such Receipt of the
Repurchase Notice. The Company may not exercise its Repurchase Right if a
Default or an Event of Default has occurred and is continuing. The Company may
not exercise its Repurchase Right after a Change in Control (as defined in the
Employment Agreement).

                                      A-19
<PAGE>   24

                                    EXHIBIT A

                              NOTICE OF CONVERSION

       (To be executed in order to Convert all or any portion of the Note)

The undersigned hereby irrevocably elects to convert [ALL] [___%] of the Stated
Value of the Note issued by NAHC, Inc. (the "Company") to the undersigned into
shares of common stock, par value U.S. $.01 per share ("Common Stock"), of the
Company according to the conditions of the Note, as of the date written below.
If shares are to be issued in the name of a person other than the undersigned,
the undersigned will pay all transfer taxes payable with respect thereto and is
delivering herewith such certificates. No fee will be charged to the holder for
any conversion, except for transfer taxes, if any. The Note is attached hereto
(or evidence of loss, theft or destruction thereof).

Capitalized terms used but not defined herein shall have the meanings ascribed
thereto in or pursuant to the Note.

                                    Date of Conversion:

                                    Applicable Conversion Price:

                                    Percentage of Stated Value to be converted:

                                    Number of shares of Common Stock to be
                                    Issued:

                                    Signature:
                                    Name:

                                    Address:

                                      A-1

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