Document:

Exhibit
      4.1

     

    NEITHER
      THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
      THE
      SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
      LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
      (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL,
      IN A
      FORM REASONABLY ACCEPTABLE TO THE COMPANY AND ITS LEGAL COUNSEL, THAT
      REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO
      RULE
      144 UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED
      IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING
      ARRANGEMENT SECURED BY THE SECURITIES.

     

    Original
      Issue Date: February 16, 2007

    

    $[ 
      ]

    No.
      1 

     

    MILLENNIUM
      CELL INC.

    CONVERTIBLE
      DEBENTURE

    

    THIS
      DEBENTURE is one of a series of duly authorized and issued debentures of
      Millennium Cell Inc., a corporation organized under the laws of the state of
      Delaware (the “Company”),
      designated as its Convertible Debentures in the aggregate principal amount
      of
      Six Million Dollars ($6,000,000) (each a "Debenture"
      and
      collectively, the “Debentures”).

     

    FOR
      VALUE
      RECEIVED, the Company promises to pay to [PORTSIDE GROWTH & OPPORTUNITY
      FUND] [OTHER BUYERS] or its registered assigns (the “Holder”)
      the
      principal sum of Six Million Dollars ($6,000,000) and any additional sums due
      pursuant to the terms hereof on the Maturity Date (subject to extension as
      herein provided) and to pay interest to the Holder on the principal amount
      of
      this Debenture in accordance with the provisions hereof. Other than as
      specifically permitted by this Debenture, the Company may not prepay any portion
      of the outstanding principal and any accrued and unpaid interest on such
      principal. This Debenture is subject to the following additional
      provisions.

     

    1. Definitions.
      As used
      in this Debenture, the following terms shall have the meanings set forth in
      this
      Section 1:

     

    “Bankruptcy
      Event”
means
      any of the following events: (a) the Company or any subsidiary thereof commences
      a case or other proceeding under any bankruptcy, reorganization, arrangement,
      adjustment of debt, relief of debtors, dissolution, insolvency or Liquidation
      or
      similar law of any jurisdiction relating to the Company or any subsidiary
      thereof; (b) there is commenced against the Company or any subsidiary thereof
      any such case or proceeding that is not dismissed within 60 days after
      commencement; (c) the Company or any subsidiary thereof is adjudicated insolvent
      or bankrupt or any order of relief or other order approving any such case or
      proceeding is entered; (d) the Company or any subsidiary thereof suffers any
      appointment of any custodian or the like for it or any substantial part of
      its
      property that is not discharged or stayed within 60 days; (e) the Company or
      any
      subsidiary thereof makes a general assignment for the benefit of creditors;
      (f)
      the Company or any subsidiary thereof fails to pay, or states that it is unable
      to pay or is unable to pay, its debts generally as they become due; (g) the
      Company or any subsidiary thereof calls a meeting of its creditors with a view
      to arranging a composition, adjustment or restructuring of its debts; or (h)
      the
      Company or any subsidiary thereof, by any act or failure to act, expressly
      indicates its consent to, approval of or acquiescence in any of the foregoing
      or
      takes any corporate or other action for the purpose of effecting any of the
      foregoing.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Business
      Day”
means
      any day except Saturday, Sunday and any day which shall be a federal legal
      holiday or a day on which banking institutions in the State of New York or
      the
      State of New Jersey are authorized or required by law or other governmental
      action to close.

     

    "Cash"
      means,
      at any time, the total amount of "cash and cash equivalents" of the Company
      and
      its subsidiaries as set forth in or reflected on the most recent consolidated
      balance sheet of the Company and its Subsidiaries prepared in accordance with
      GAAP.

     

    "Cash
      to Unsecured Indebtedness Ratio"
      means,
      for any Fiscal Quarter, the ratio of (i) Cash for such Fiscal Quarter to (ii)
      Unsecured Indebtedness for such Fiscal Quarter.

     

    "Change
      of Control"
      means
      any Fundamental Transaction other than (a) any reorganization, recapitalization
      or reclassification of Common Stock, in which holders of the Company's voting
      power immediately prior to such reorganization, recapitalization or
      reclassification continue after such reorganization, recapitalization or
      reclassification to hold publicly traded securities and, directly or indirectly,
      the voting power of the surviving entity or entities necessary to elect a
      majority of the members of the board of directors (or their equivalent if other
      than a corporation) of such entity or entities, or (b) pursuant to a migratory
      merger effected solely for the purpose of changing the jurisdiction of
      incorporation of the Company.

     

    “Closing
      Price”
means,
      for any date, the price determined by the first of the following clauses that
      applies: (a) if the Common Stock is then listed or quoted on an Eligible Market,
      the closing sales price per share of the Common Stock for such date (or the
      nearest preceding date) on the primary Eligible Market on which the Common
      Stock
      is then listed or quoted; (b) if the Common Stock is not then listed or quoted
      on an Eligible Market and if prices for the Common Stock are then quoted on
      the
      OTC Bulletin Board(or any successor thereto), the closing sales price per share
      of the Common Stock for such date (or the nearest preceding date) on the OTC
      Bulletin Board(or any successor thereto); (c) if the Common Stock is not then
      listed or quoted on an Eligible Market or the OTC Bulletin Board (or any
      successor thereto) and if prices for the Common Stock are then reported in
      the
“Pink Sheets” published by Pink Sheets, LLC (or a similar organization or agency
      succeeding to its functions of reporting prices), the most recent sales price
      per share of the Common Stock so reported; or (d) in all other cases, the fair
      market value of a share of Common Stock as determined by an independent
      appraiser selected in good faith by the Holder. All such determinations to
      be
      appropriately adjusted for any stock dividend, stock split, stock combination
      or
      other similar transaction during the applicable calculation period.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    “Commission”
means
      the Securities and Exchange Commission.

     

    “Common
      Stock”
means
      the Company’s common stock, $.001 par value, and stock of any other class into
      which such shares may be reclassified or changed.

     

    "Common
      Stock Deemed Outstanding"
      means,
      at any given time, the number of shares of Common Stock actually outstanding
      at
      such time, plus the number of shares of Common Stock deemed to be outstanding
      pursuant to Sections 5(j)(ii)(A) and 5(j)(ii)(B) hereof regardless of whether
      the Options or Convertible Securities are actually exercisable at such time,
      but
      excluding any shares of Common Stock owned or held by or for the account of
      the
      Company or issuable upon conversion or exercise, as applicable, of the
      Debentures and the Warrants.

     

    “Common
      Stock Equivalents”
means
      any securities of the Company or a subsidiary thereof which entitle the holder
      thereof to acquire Common Stock at any time, including without limitation,
      any
      debt, preferred stock, rights, options, warrants or other instrument that is
      at
      any time convertible into or exchangeable for, or otherwise entitles the holder
      thereof to receive, Common Stock or other securities that entitle the holder
      to
      receive, directly or indirectly, Common Stock. 

     

    “Company
      Conversion Notice”
means
      a
      written notice (together with a Conversion Schedule) in the form attached hereto
      as Exhibit
      B.

     

    "Contingent
      Obligation"
      means,
      as to any Person, any direct or indirect liability, contingent or otherwise,
      of
      that Person with respect to any indebtedness, lease, dividend or other
      obligation of another Person if the primary purpose or intent of the Person
      incurring such liability, or the primary effect thereof, is to provide assurance
      to the obligee of such liability that such liability will be paid or discharged,
      or that any agreements relating thereto will be complied with, or that the
      holders of such liability will be protected (in whole or in part) against loss
      with respect thereto.

     

    “Conversion
      Date”
means
      either a Holder Conversion Date, a Company Election Conversion Date or a Forced
      Conversion Date..

     

    “Conversion
      Notice”
means
      either a Holder Conversion Notice, a Company Conversion Election Notice or
      a
      Forced Conversion Notice.

     

    “Conversion
      Price”
means
      the Initial Conversion Price or the Revised Conversion Price, as applicable,
      subject to adjustment from time to time pursuant to Section 5(j).

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    "Conversion
      Rate"
      means
      the rate determined by dividing (i) the principal amount being converted by
      (ii)
      the Conversion Price.

     

    "Convertible
      Securities"
      means
      any stock or securities (other than Options) directly or indirectly convertible
      into or exchangeable or exercisable for Common Stock.

     

    "Default Rate"
      means
      the Interest Rate in effect as of the date of occurrence of an Event of Default
      plus seven percent (7.0%).

     

    “Delivery
      Date”
means
      the date a Forced Conversion Notice is delivered to the Holder pursuant to
      Section 5(c), or the date a Holder Conversion Notice is delivered pursuant
      to
      the last sentence of Section 5(a).

     

    “Early
      Conversion Amount”
means
      the product of (i) the Holder Pro Rata Amount times
      (ii)
      $1,000,000.

     

    "Effective
      Date"
      has the
      meaning ascribed to such term in the Registration Rights Agreement.

     

    "Eligible
      Market"
      means
      the Principal Market, The New York Stock Exchange, Inc., the American Stock
      Exchange, The NASDAQ Global Market or The NASDAQ Global Select
      Market.

     

    “Equity
      Conditions”
means
      that each of the following conditions is satisfied: (i) on each day during
      the
      period beginning twenty (20) Trading Days prior to the applicable date of
      determination and ending on and including the applicable date of determination
      (the "Equity
      Conditions Measuring Period"),
      the
      number of authorized but unissued and otherwise unreserved shares of Common
      Stock is sufficient for the issuance of Underlying Shares at issue; (ii) during
      the Equity Conditions Measuring Period, either (A) the Underlying Shares are
      registered for resale by the Holder pursuant to an effective registration
      statement in accordance with the terms of the Registration Rights Agreement,
      and
      the prospectus thereunder is available for use by the Holder to sell such shares
      or (B) all such shares may be sold without volume restrictions pursuant to
      Rule
      144(k) under the Securities Act and without the need for registration under
      any
      applicable state securities laws; (iii) during the Equity Conditions
      Measuring Period, the Common Stock is listed or quoted and is not suspended
      from
      trading on an Eligible Market and such shares of Common Stock are approved
      for
      listing on such Eligible Market upon issuance and no delisting or suspension
      by
      such market is effective, pending or threatened in writing to occur within
      90
      days; (iv) such issuance would be permitted in full without violating Section
      5(d)(i), Section 5(d)(ii) or the rules or regulations of the Eligible Market
      on
      which such shares are listed or quoted; (v) during the Equity Conditions
      Measuring Period, no Event of Default nor any event that with the passage of
      time and without being cured would constitute a Event of Default has occurred
      and not been cured, (vi) during the Equity Conditions Measuring Period, no
      public announcement of a pending, proposed or intended Change of Control
      transaction has occurred that has not been consummated; (vii) during the Equity
      Conditions Measuring Period, the Company shall have delivered shares of Common
      Stock upon conversion of the Debentures and shares of Common Stock upon exercise
      of the Warrants on a timely basis as set forth in Section 5(e) hereof (and
      analogous provisions of under the other Debentures) and Sections 1(a) and 1(b)
      of the Warrants; (viii) from and after the Stockholder Meeting Deadline (as
      defined in the Purchase Agreement), the Company shall have obtained the
      Stockholder Approval (as defined in the Purchase Agreement); (ix) the Company
      shall have no knowledge of any fact not caused by the failure of the holders
      of
      Debentures to provide any required information that would cause (A) the
      Registration Statements required pursuant to the Registration Rights Agreement
      not to be effective and available for the resale of all remaining Registrable
      Securities (as defined in the Registration Rights Agreement) in accordance
      with
      the terms of the Registration Rights Agreement or (B) any shares of Common
      Stock
      issuable upon conversion of the Debentures not to be eligible for sale without
      restriction pursuant to Rule 144(k) and any applicable state securities laws
      and
      (x) the Company otherwise shall have been in material compliance with and shall
      not have materially breached any provision, covenant, representation or warranty
      of any Transaction Document.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    "Equity
      Conditions Failure"
      means
      that (i) on any day during the period commencing five (5) Trading Days prior
      to
      the applicable Interest Election Notice Date through the applicable Interest
      Date, (ii) on any day during the period commencing fifteen (15) Trading Days
      prior to the applicable Company Conversion Notice Date through the applicable
      Company Election Conversion Date and (iii) on any day during the period
      commencing five (5) Trading Days prior to the applicable Forced Conversion
      Notice Date through the applicable Forced Conversion Date, the Equity Conditions
      have not been satisfied (or waived in writing by the Holder).

     

    “Event
      of Default”
means
      the occurrence of any one of the following events (whatever the reason and
      whether it shall be voluntary or involuntary or effected by operation of law
      or
      pursuant to any judgment, decree or order of any court, or any order, rule
      or
      regulation of any administrative or governmental body):

     

    (i) any
      default in the payment of principal or liquidated damages (as provided for
      in
      the Registration Rights Agreement) in respect of any Debentures or any other
      “Debenture” (as such term is defined in the Purchase Agreement), as and when the
      same becomes due and payable (whether by acceleration or otherwise), or any
      default in the payment of interest, a Buy-in Price or any other amounts due
      pursuant to the Transaction Documents in respect of any Debentures, within
      five
      Business Days of when the same becomes due and payable;

     

    (ii) a
      Bankruptcy Event;

     

    (iii) the
      Common Stock is not listed or quoted, or is suspended from trading, on an
      Eligible Market for a period of five (5) consecutive Trading Days or for more
      than an aggregate of ten (10) Trading Days in any 365-day period, provided,
      that
      voluntary suspensions of the Common Stock from an Eligible Market by the Company
      for less than one hour at a time to disseminate material information shall
      not
      be included within such number of Trading Days;

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    (iv) the
      Company shall fail for any reason to deliver certificates representing
      Underlying Shares issuable upon a conversion hereunder that comply with the
      provisions hereof prior to the fifth Business Day after the applicable
      Conversion Date or the Company shall provide notice to any Holder, including
      by
      way of public announcement, at any time, of its intention not to comply with
      requests for conversion of Debentures in accordance with the terms
      hereof;

     

    (v) the
      Company shall fail to have available a sufficient number of authorized and
      unreserved shares of Common Stock to issue to such Holder upon a conversion
      hereunder;

     

    (vi) while
      the
      applicable Registration Statement is required to be maintained effective
      pursuant to the terms of the Registration Rights Agreement, the effectiveness
      of
      the applicable Registration Statement lapses for any reason (including, without
      limitation, the issuance of a stop order) or the Holder shall not be permitted
      to resell Registrable Securities (as defined in the Registration Rights
      Agreement) under the applicable Registration Statement, in either case, for
      more
      than seven consecutive Trading Days or an aggregate of twenty Trading Days
      (which need not be consecutive Trading Days);

     

    (vii) any
      breach or failure in any respect to comply with Section 7 of this Debenture;
      

     

    (viii) the
      Company breaches any representation or warranty or defaults in the timely
      performance of any covenant or obligation under the Transaction Documents (other
      than such covenants or obligations which are specifically addressed elsewhere
      in
      this definition) except, in the case of a default in the performance of any
      such
      covenant or obligation of any Transaction Document which is curable, only if
      such default continues uncured for a period of at least ten (10) Trading
      Days;

     

    (ix) the
      failure of the applicable Registration Statement required to be filed pursuant
      to the Registration Rights Agreement to be (A) filed on or prior to the date
      that is sixty
      (60) days after
      the
      applicable Filing Deadline (as defined in the Registration Rights Agreement)
      or
      (B) declared effective by the SEC on or prior to the date that is sixty (60)
      days after the applicable Effectiveness Deadline (as defined in the Registration
      Rights Agreement);

     

    (x) the
      Company or any Subsidiary defaults in any of its obligations under any (A)
      other
      debenture (including without limitation, any Debenture (as defined in the
      Purchase Agreement)) or any mortgage, credit agreement or other facility,
      indenture agreement, factoring agreement or other instrument (other than
      Permitted Pari Passu Indebtedness) under which there may be issued, or by which
      there may be secured or evidenced, any indebtedness for borrowed money or money
      due under any long term leasing or factoring arrangement of the Company or
      any
      Subsidiary in an amount exceeding, individually or in the aggregate, $250,000,
      whether such indebtedness now exists or is hereafter created or (B) Permitted
      Pari Passu Indebtedness;
      or

     

    (xi) a
      final
      judgment or judgments for the payment of money aggregating in excess of $250,000
      are rendered against the Company or any of its Subsidiaries and which judgments
      are not, within sixty (60) days after the entry thereof, bonded, discharged
      or
      stayed pending appeal, or are not discharged within sixty (60) days after the
      expiration of such stay; provided, however, that any judgment which is covered
      by insurance or an indemnity from a credit worthy party shall not be included
      in
      calculating the $250,000 amount set forth above so long as the Company provides
      the Holder a written statement from such insurer or indemnity provider (which
      written statement shall be reasonably satisfactory to the Holder) to the effect
      that such judgment is covered by insurance or an indemnity and the Company
      will
      receive the proceeds of such insurance or indemnity within thirty (30) days
      of
      the issuance of such judgment; or

     

    
      
        
        

      

      
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    (xii) the
      occurrence of an Event of Default (as defined in the Debentures) under any
      other
      Debenture.

     

    “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended.

     

    "Excluded
      Securities"
      means:

     

    (a) Any
      grant
      of an option or warrant for Common Stock or issuance of any shares of Common
      Stock upon the exercise or exchange (but only if such exchange does not,
      directly or indirectly, result in a reduction of the exercise price therefor
      on
      a per share basis) of any options or warrants or the issuance of any restricted
      stock grant to employees, officers and directors of or consultants to the
      Company pursuant to any stock option plan, employee stock purchase plan or
      similar plan or incentive or consulting arrangement approved by the Company’s
      board of directors; 

     

    (b) Any
      Common Stock Equivalents or any rights or agreements to purchase Common Stock
      outstanding on the date hereof and as specified in Schedule
      3.1(g)
      to the
      Purchase Agreement (but not as to any amendments or other modifications to
      the
      number of Common Stock issuable thereunder, the terms set forth therein, or
      the
      exercise price set forth therein) unless such modification is the result of
      a
      provision contained in the Common Stock Equivalent on the date
      hereof);

     

    (c) Any
      Common Stock or Common Stock Equivalents issued for consideration other than
      cash pursuant to a merger, consolidation, acquisition or other similar business
      combination the primary purpose of which is not to raise equity
      capital;

     

    (d) Any
      issuances of Common Stock or Common Stock Equivalents to a Person which is
      or
      will be, itself or through its subsidiaries, an operating company in a business
      related to or complementary with the business of the Company and in which the
      Company receives reasonably material benefits in addition to the investment
      of
      funds, but shall not include a transaction in which the Company is issuing
      securities primarily for the purpose of raising capital or to an entity whose
      primary business is investing in securities; 

     

    (e) Any
      Common Stock Equivalents that entitle the holders thereof to acquire up to
      500,000 shares of Common Stock issued pursuant to any equipment leasing
      arrangement;

     

    
      
        
        

      

      
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    (f) Any
      Common Stock or Common Stock Equivalents issued to pay all or a portion of
      any
      investment banking, finders or similar fee or commission, which entitles the
      holders thereof to acquire shares of Common Stock at a price not less than
      the
      market price of the Common Stock on the date of such issuance and which is
      not
      subject to any adjustments other than on account of stock splits and reverse
      stock splits;

     

    (g) A
      bona
      fide underwritten public offering of the Common Stock resulting in gross
      proceeds in excess of $10 million to the Company (it being understood that
      "at
      the market offerings" as defined in Rule 415(a)(4) under the Securities Act
      or
      equity line transactions, including any on going warrant financing, or any
      similar arrangements shall not constitute a bona fide underwritten public
      offering of the Common Stock for the purposes hereof); 

     

    (h) Any
      Common Stock issued following an adjustment to the Conversion Price pursuant
      to
      Section 5(c);

     

    (i) Any
      Common Stock issued upon the conversion of the Series C2 Preferred Stock;
      and

     

    (j) Any
      Common Stock issued upon the conversion of the Debentures or upon exercise
      of
      the Warrants.

     

    "Fiscal
      Quarter" means
      each of the fiscal quarters adopted by the Company for financial reporting
      purposes that correspond to the Company's fiscal year as of the date hereof
      that
      ends on December 31.

     

    "Forced
      Conversion Conditions"
      means,
      for any applicable date of determination, (a)
      there
      has been no Equity Conditions Failure, (b) the Closing Price on the Forced
      Conversion Date is greater than either (i) if the Closing Price on such date
      is
      $1.00 or greater, 109% of the Revised Conversion Price or (ii) if the Closing
      Price on such date is less than $1.00, 115% of the Revised Conversion Price
      and
      (c) less than $2 million of the Series C Preferred Stock of the Company remains
      outstanding. 

     

    “Forced
      Conversion Date”
means
      the third (3rd)
      Trading
      Day immediately following the date a Forced Conversion Notice is delivered
      to
      the Holder pursuant to Section 5(c).

     

    "Forced
      Conversion Notice Date"
      means,
      with respect to any Forced Conversion notice, the date that the Holder receives
      such Forced Conversion Notice.

     

    
      
        
        

      

      
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    "Fundamental
      Transaction"
      means
      that (a) the Company shall, directly or indirectly, in one or more related
      transactions, (i) consolidate or merge with or into (whether or not the Company
      is the surviving corporation) another Person, or (ii) sell, assign, transfer,
      convey or otherwise dispose of all or substantially all of the properties or
      assets of the Company to another Person, or (iii) allow another Person to make
      a
      purchase, tender or exchange offer that is accepted by the holders of more
      than
      the 50% of the outstanding shares of Common Stock (not including any shares
      of
      Common Stock held by the Person or Persons making or party to, or associated
      or
      affiliated with the Persons making or party to, such purchase, tender or
      exchange offer), or (iv) consummate a stock purchase agreement or other business
      combination (including, without limitation, a reorganization, recapitalization,
      spin-off or scheme of arrangement) with another Person whereby such other Person
      acquires more than the 50% of the outstanding shares of Common Stock (not
      including any shares of Common Stock held by the other Person or other Persons
      making or party to, or associated or affiliated with the other Persons making
      or
      party to, such stock purchase agreement or other business combination), or
      (v)
      reorganize, recapitalize or reclassify its Common Stock (excluding stock splits,
      reverse stock splits or stock combinations), or (b) any "person" or "group"
      (as
      these terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
      Act) is or shall become the "beneficial owner" (as defined in Rule 13d-3 under
      the Exchange Act), directly or indirectly, of 50% of the aggregate ordinary
      voting power represented by issued and outstanding Common Stock or (c) a
      replacement at one time or over time of more than one-half of the members of
      the
      Company’s board of directors which is not approved by a majority of those
      individuals who are members of the board of directors on the Issuance Date
      (or
      by those individuals who are serving as members of the board of directors on
      any
      date whose nomination to the board of directors was approved by a majority
      of
      the members of the board of directors or members of the board’s Nominating and
      Corporate Governance Committee who are also members of the board or the board’s
      Nominating and Corporate Governance Committee, as the case may be, on the
      Issuance Date). A Fundamental Transaction shall not be deemed to include any
      of
      the transactions contemplated by the Stock Purchase Agreement between the
      Company and The Dow Chemical Company dated as of February 27, 2005 as amended
      prior to the Issuance Date.

     

    "GAAP"
      means
      United States generally accepted accounting principles, consistently
      applied.

     

    “Holder Conversion
      Date”
means
      the third (3rd)
      Trading
      Day after a Holder Conversion Notice together with the Conversion Schedule
      is
      delivered to the Company pursuant to Section 5(a). 

     

    “Holder Conversion
      Notice”
means
      a
      written notice (together with a Conversion Schedule) in the form attached hereto
      as Exhibit
      A.

     

    "Holder
      Conversion Notice Date"
      means
      the date that the Holder delivers a Holder Conversion Notice to the Company
      pursuant to Section 5(a).

     

    "Holder
      Pro Rata Amount"
      means a
      fraction, the numerator of which is the original principal amount of this
      Debenture on the Original Issue Date and the denominator of which is the
      aggregate original principal amount of all the Debentures issued to all of
      the
      holders on the Original Issue Date.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    "Indebtedness"
      of any
      Person means, without duplication (i) all indebtedness for borrowed money,
      (ii)
      all obligations issued, undertaken or assumed as the deferred purchase price
      of
      property or services, including (without limitation) "capital leases" in
      accordance with generally accepted accounting principles (other than trade
      payables entered into in the ordinary course of business), (iii) all
      reimbursement or payment obligations with respect to letters of credit, surety
      bonds and other similar instruments, (iv) all obligations evidenced by notes,
      bonds, debentures or similar instruments, including obligations so evidenced
      incurred in connection with the acquisition of property, assets or businesses,
      (v) all indebtedness created or arising under any conditional sale or other
      title retention agreement, or incurred as financing, in either case with respect
      to any property or assets acquired with the proceeds of such indebtedness (even
      though the rights and remedies of the seller or bank under such agreement in
      the
      event of default are limited to repossession or sale of such property), (vi)
      all
      monetary obligations under any leasing or similar arrangement which, in
      connection with generally accepted accounting principles, consistently applied
      for the periods covered thereby, is classified as a capital lease, (vii) all
      indebtedness referred to in clauses (i) through (vi) above secured by (or for
      which the holder of such Indebtedness has an existing right, contingent or
      otherwise, to be secured by) any mortgage, lien, pledge, charge, security
      interest or other encumbrance upon or in any property or assets (including
      accounts and contract rights) owned by any Person, even though the Person which
      owns such assets or property has not assumed or become liable for the payment
      of
      such indebtedness, and (viii) all Contingent Obligations in respect of
      indebtedness or obligations of others of the kinds referred to in clauses (i)
      through (vii) above.

     

    “Index
      Price”
      means
      the arithmetic average of the VWAP’s for the 10 consecutive Trading Days
      immediately preceding the Delivery Date.

     

    “Initial Conversion
      Price”
shall
      equal $1.42 (subject to equitable adjustment for stock splits, recombinations
      and similar events).

     

    "Interest
      Conversion Price"
      means,
      with respect to any Interest Payment Date that
      price which shall be the lower of
      (i) the
      applicable Conversion Price and (ii) the price computed as 91% of the arithmetic
      average of the VWAP on each of the five (5) consecutive Trading Days ending
      on
      the Trading Day immediately preceding the applicable Interest Payment Date
      (each, an "Interest
      Measuring Period").
      All
      such determinations to be appropriately adjusted for any stock split, stock
      dividend, stock combination or other similar transaction during such Interest
      Measuring Period.

     

    "Interest
      Election Notice Due Date"
      means
      the twentieth (20th)
      Trading
      Day prior to the applicable Interest Payment Date.

     

    “Interest
      Payment Date”
means
      each March 31, June 30, September 30 and December 31, beginning on the first
      such date following the Original Issue Date, except if such date is not a
      Trading Day, in which case such Interest Payment Date shall be the next
      succeeding Trading Day.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

    "Interest Rate"
      means
      the Prime Rate as of the first (1st)
      Business Day of each Interest Period.

     

    “Liquidation”
means
      for any Person, any liquidation, dissolution or winding-up of such Person,
      whether voluntary or involuntary, by operation or law or otherwise.

     

    “Majority
      Holders”
means
      holders of Debentures then holding a majority of the outstanding face amount
      of
      Debentures.

     

    “Mandatory
      Convertible Amount”
means
      $500,000, provided,
      that
      with respect to each Forced Conversion Date, such amount may be increased by
      mutual consent of the Majority Holders and the Company reached prior to the
      applicable Forced Conversion Date.

     

    “Mandatory
      Redemption Amount”
means
      for any Debentures: (I) with respect to an Event of Default under clauses (i)
      and (iii)-(xii) thereof, an amount equal to the sum of: (i) the greater of
      (A)
      120% of the principal amount of Debentures to be redeemed and, if applicable,
      the Reinstated Principal, plus all accrued and unpaid interest thereon, and
      (B)
      the principal amount of Debentures to be prepaid and, if applicable, the
      Reinstated Principal, plus all accrued and unpaid interest thereon, divided
      by
      the Conversion Price on the Trading Day immediately preceding (x) the date
      of
      the Event of Default, (y) the date the Mandatory Redemption Amount is paid
      in
      full or (z) the date immediately after the Event of Default, whichever is less,
      multiplied by the Closing Price on (x) the date of the Event of Default, (y)
      the
      date the Mandatory Redemption Amount is paid in full or (z) the date immediately
      after the Event of Default, whichever is greater, and (ii) all other amounts,
      costs, expenses and liquidated damages due in respect of such Debentures; and
      (II) with respect to an Event of Default under clause (ii) thereof, shall equal
      the sum of: (i) the greater of (A) the principal amount of Debentures to be
      prepaid and, if applicable, the Reinstated Principal, plus all accrued and
      unpaid interest thereon, and (B) the principal amount of Debentures to be
      prepaid and, if applicable, the Reinstated Principal, plus all accrued and
      unpaid interest thereon, divided by the Conversion Price on the Trading Day
      immediately preceding (x) the date of the Event of Default, (y) the date the
      Mandatory Redemption Amount is paid in full or (z) the date immediately after
      the Event of Default, whichever is less, multiplied by the Closing Price on
      (x)
      the date of the Event of Default, (y) the date the Mandatory Redemption Amount
      is paid in full or (z) the date immediately after the Event of Default,
      whichever is greater, and (ii) all other amounts, costs, expenses and liquidated
      damages due in respect of such Debentures.

     

    "Maturity
      Date"
      means
      February 16, 2009, as may be extended at the option of the Holder (i) in the
      event that, and for so long as, an Event of Default shall have occurred and
      be
      continuing on the Maturity Date (as may be extended pursuant hereto) or any
      event that shall have occurred and be continuing that with the passage of time
      and the failure to cure would result in an Event of Default and (ii) through
      the
      date that is ten (10) Business Days after the consummation of a Change of
      Control in the event that a Change of Control is publicly announced or a Change
      of Control Notice (as defined in Section 6(b)) is delivered prior to the
      Maturity Date. Notwithstanding the foregoing, the Company and the Holder
      acknowledge that the Maturity Date may be extended by mutual consent of the
      Company and the Majority Holders on up to six occasions by an additional 30
      days
      or such other period mutually agreed.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    "Options"
      means
      any rights, warrants or options to subscribe for or purchase Common Stock or
      Convertible Securities.

     

    “Original
      Issue Date”
means
      the date of the first issuance of any Debentures, regardless of the number
      of
      transfers of any particular Debenture and regardless of the number of
      certificates which may be issued to evidence such Debentures.

     

    "Parent
      Entity"
      of a
      Person means an entity that, directly or indirectly, controls the applicable
      Person and whose common stock or equivalent equity security is quoted or listed
      on an Eligible Market, or, if there is more than one such Person or Parent
      Entity, the Person or Parent Entity with the largest public market
      capitalization as of the date of consummation of the Fundamental
      Transaction.

     

    "Permitted
      Indebtedness"
      means
      (i) unsecured Indebtedness incurred by the Company that is made expressly
      subordinate in right of payment to the Indebtedness evidenced by this Debenture,
      as reflected in a written agreement acceptable to the Holder and approved by
      the
      Holder in writing, and which Indebtedness does not provide at any time for
      (1)
      the payment, prepayment, repayment, repurchase or defeasance, directly or
      indirectly, of any principal or premium, if any, thereon until at least
      ninety-one (91) days after the Maturity Date or later and (2) total interest
      and
      fees at a rate in excess of the Interest Rate per annum, (ii) Indebtedness
      of
      the Company or any Subsidiary existing on the Issuance Date as set forth on
      Schedule 3(s) to the Securities Purchase Agreement, (iii) Indebtedness secured
      by Permitted Liens, (iv) Indebtedness of the Company or any Subsidiary that
      is
pari
      passu
      in right
      of payment to the Indebtedness evidenced by this Debenture, and which
      Indebtedness does not provide at any time (other than upon acceleration
      following the occurrence of an event of default thereunder or upon the
      refinancing of such Indebtedness in accordance with clause (vi) below) for
      the
      payment, prepayment, repayment, repurchase or defeasance, directly or
      indirectly, of any principal or premium, if any, thereon until at least
      ninety-one (91) days after the Maturity Date and does not at any time have
      an
aggregate
      outstanding amount in excess of $10,000,000; notwithstanding the foregoing,
      the
      Holder
      maintains the rights set forth in Section 4(q) of the Securities Purchase
      Agreement in connection with the incurrence of any such Indebtedness (such
      Indebtedness, the "Permitted Pari
      Passu Indebtedness),
      (v)
      Indebtedness under this Debenture and the other Debentures, and (vi)
extensions,
      refinancings and renewals of any Indebtedness referenced in clauses (i) through
      (iv) above, provided that the principal amount is not increased or the terms
      modified to impose more burdensome terms upon the Company or its Subsidiaries,
      as the case may be; provided, however, that with respect to Permitted Pari
      Passu
      Indebtedness, (A) the principal amount of such Indebtedness may be increased
      so
      long as such increase does not result in an aggregate outstanding amount of
      Permitted Pari Passu Indebtedness in excess of $10,000,000 and (B) the principal
      amount of such Indebtedness shall not be less than the principal amount of
      such
      Permitted Pari Passu Indebtedness being extended, refinanced or
      renewed.

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    "Permitted
      Liens"
      means
      (i) any Lien for taxes not yet due or delinquent or being contested in good
      faith by appropriate proceedings for which adequate reserves have been
      established in accordance with GAAP, (ii) any statutory Lien arising in the
      ordinary course of business by operation of law with respect to a liability
      that
      is not yet due or delinquent, (iii) any Lien created by operation of law, such
      as materialmen's liens, mechanics' liens and other similar liens, arising in
      the
      ordinary course of business with respect to a liability that is not yet due
      or
      delinquent or that are being contested in good faith by appropriate proceedings,
      (iv) Liens (A) upon or in any equipment acquired or held by the Company or
      any
      of its Subsidiaries to secure the purchase price of such equipment or
      indebtedness incurred solely for the purpose of financing the acquisition or
      lease of such equipment, or (B) existing on such equipment at the time of its
      acquisition, provided that the Lien is confined solely to the property so
      acquired and improvements thereon, and the proceeds of such equipment, (v)
      Liens
      incurred in connection with the extension, renewal or refinancing of the
      indebtedness secured by Liens of the type described in clauses (i) and (iv)
      above, provided that any extension, renewal or replacement Lien shall be limited
      to the property encumbered by the existing Lien and the principal amount of
      the
      Indebtedness being extended, renewed or refinanced does not increase, (vi)
      leases or subleases and licenses and sublicenses granted to others in the
      ordinary course of the Company's business, not interfering in any material
      respect with the business of the Company and its Subsidiaries taken as a whole,
      (vii) Liens in favor of customs and revenue authorities arising as a matter
      of law to secure payments of custom duties in connection with the importation
      of
      goods, (viii)
      Liens
      arising from judgments, decrees or attachments in circumstances not constituting
      an Event of Default under clause (xi) of such definition and (ix) Liens
      securing Indebtedness incurred in connection with the financing and/or
      consummation of any strategic acquisition or strategic transaction by the
      Company or any Subsidiary; provided, that, (A)
      at the
      time of incurrence of such Liens the Closing Sale Price of the Common Stock
      exceeds 150% of the Initial Conversion Price (as adjusted for any stock split,
      stock dividend, stock combination or other similar transaction) and (B) only
      the
      equity of any Person and/or assets being acquired may be subject to such
      Liens.

     

    “Person”
means
      an individual or corporation, partnership, trust, incorporated or unincorporated
      association, joint venture, limited liability company, joint stock company,
      government (or an agency or subdivision thereof) or other entity of any
      kind.

     

    "Prime
      Rate"
      shall
      mean as of a particular date, the prime rate of interest as published on that
      date in The
      Wall Street Journal
      (Eastern
      Edition), and generally defined therein as "the base rate on corporate loans
      posted by at least 75% of the nation's 30 largest banks." If The
      Wall Street Journal
      is not
      published on a date for which the Prime Rate must be determined, the Prime
      Rate
      shall be the prime rate published in The
      Wall Street Journal
      on the
      nearest-preceding date on which The
      Wall Street Journal
      was
      published.

     

    "Principal
      Market"
      means
      The NASDAQ Capital Market.

     

    “Proceeding”
means
      an action, claim, suit, investigation or proceeding (including, without
      limitation, an investigation or partial proceeding, such as a deposition),
      whether commenced or threatened in writing concerning the interpretation,
      enforcement or defense of any transaction contemplated by any Transaction
      Document (whether brought against a party hereto or such parties affiliates,
      directors, officers, employees or agents).

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

     

    “Purchase
      Agreement”
means
      the Securities Purchase Agreement, dated as of February 15, 2007, to which
      the
      Company and the original Holder are parties, as amended, modified or
      supplemented from time to time in accordance with its terms.

     

    “Registration
      Rights Agreement”
means
      the Registration Rights Agreement, dated as of February 15, 2007, to which
      the
      Company and the original Holder are parties, as amended, modified or
      supplemented from time to time in accordance with its terms.

     

    "Registration
      Statement” shall
      have the meaning set forth in the Registration Rights Agreement.

    

    “Reinstated
      Principal”
means
      the principal amount of Debentures converted during the ten Trading Days
      preceding the delivery of an Event of Default Notice, for which the Company
      issued or was obligated to issue Underlying Shares to the Holder.

     

    "Revised
      Conversion Price"
      means,
      for any applicable date of determination, the lower of (a) the Initial
      Conversion Price and (b) 91% of the Index Price.

     

    “Securities
      Act”
means
      the Securities Act of 1933, as amended.

     

    "Series
      C2 Preferred Stock"
      shall
      mean the Series C2 Convertible Preferred Stock of the Company, par value $0.001
      per share.

     

    "Subscription
      Date"
      means
      February 15, 2007.

     

    "Successor
      Entity"
      means
      the Person, which may be the Company, formed by, resulting from or surviving
      any
      Fundamental Transaction or the Person with which such Fundamental Transaction
      shall have been made, provided that if such Person is not a publicly traded
      entity whose common stock or equivalent equity security is quoted or listed
      for
      trading on an Eligible Market, Successor Entity shall mean such Person's Parent
      Entity.

     

    “Subsidiary”
shall
      have the meaning set forth in the Purchase Agreement.

     

    “Trading
      Day”
means:
      (a) a day on which the shares of Common Stock are traded on an Eligible
      Market, or (b) if the shares of Common Stock are not listed on an Eligible
      Market, a day on which the shares of Common Stock are traded in the
      over-the-counter market, as reported by the OTC Bulletin Board, or (c) if
      the shares of Common Stock are not quoted on the OTC Bulletin Board, a day
      on
      which the shares of Common Stock are quoted in the over-the-counter market
      as
      reported by Pink Sheets, LLC (or any similar organization or agency succeeding
      its functions of reporting prices); provided,
      that in
      the event that the shares of Common Stock are not listed or quoted as set forth
      in (a), (b) and (c) hereof, then Trading Day shall mean a Business
      Day.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    “Transaction
      Documents”
shall
      have the meaning set forth in the Purchase Agreement.

     

    “Underlying
      Shares”
means,
      collectively, the shares of Common Stock issuable upon conversion of Debentures
      in accordance with the terms hereof.

     

    "Unsecured
      Indebtedness"
      means
      at any time, the aggregate unpaid principal amount of all Indebtedness of the
      Company and its Subsidiaries other than Indebtedness of the Company or a
      Subsidiary of the Company secured by any Lien.

     

    "Voting
      Stock"
      of a
      Person means capital stock of such Person of the class or classes pursuant
      to
      which the holders thereof have the general voting power to elect, or the general
      power to appoint, at least a majority of the board of directors, managers or
      trustees of such Person (irrespective of whether or not at the time capital
      stock of any other class or classes shall have or might have voting power by
      reason of the happening of any contingency).

     

    “VWAP”
means
      on any particular Trading Day or for any particular period, the volume weighted
      average trading price per share of Common Stock on such date or for such period
      on an Eligible Market as reported by Bloomberg L.P. (or any successor performing
      similar functions) through its "Volume at Price" functions, or, if the foregoing
      does not apply, the dollar volume-weighted average price of such security in
      the
      over-the-counter market on the electronic bulletin board the Common Stock on
      such date or during such period beginning as reported by Bloomberg (or its
      successor), or, if no dollar volume-weighted average price is reported for
      the
      Common Stock by Bloomberg (or its successor) for such date or period, the
      average of the highest closing bid price and the lowest closing ask price of
      any
      of the market makers for the Common Stock as reported in the "pink sheets"
      by
      Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Weighted
      Average Price cannot be calculated for a security on a particular date or period
      on any of the foregoing bases, the Weighted Average Price of such security
      on
      such date or period shall be the fair market value as determined by an
      independent appraiser selected in good faith by the Holder. All such
      determinations to be appropriately adjusted for any stock dividend, stock split,
      stock combination or other similar transaction during the applicable calculation
      period.

     

    "Warrants"
      has the
      meaning ascribed to such term in the Purchase Agreement, and shall include
      all
      warrants issued in exchange therefor or replacement thereof.

     

    2. Interest.

     

    (a) The
      Company shall pay interest to the Holder on the aggregate unconverted and then
      outstanding principal amount of this Debenture (including any interest added
      to
      such principal in accordance with this Section 2) at an annual rate equal to
      the
      Interest Rate, payable quarterly in arrears on each Interest Payment Date.
      Interest shall be calculated on the basis of a 360-day year and shall accrue
      daily commencing on the Original Issue Date. Subject to the conditions and
      limitations set forth below, the Company will pay interest under this Debenture
      in shares of Common Stock ("Interest
      Shares")
      so
      long as there has been no Equity Conditions Failure; provided however, that
      the
      Company may, at its option following notice to the Holder, pay Interest on
      any
      Interest Date in cash ("Cash
      Interest")
      or in
      a combination of Cash Interest and Interest Shares. The Company shall deliver
      a
      written notice (each, an "Interest
      Election Notice")
      to
      each holder of the Debentures on or prior to the Interest Election Notice Due
      Date (the date such notice is delivered to all of the holder, the "Interest
      Election Notice Date")
      which
      notice (i) either (A) confirms that Interest to be paid on such Interest Payment
      Date shall be paid entirely in Interest Shares or (B) elects to pay Interest
      as
      Cash Interest or a combination of Cash Interest and Interest Shares and
      specifies the amount of Interest that shall be paid as Cash Interest and the
      amount of Interest, if any, that shall be paid in Interest Shares and (ii)
      certifies that there has been no Equity Conditions Failure; provided, however,
      that if the Closing Sale Price of the Common Stock is not greater than $1.00
      on
      each day during the period beginning on the Interest Election Notice Date
      through the Interest Share Delivery Date, then (unless such condition is waived
      by the Holder) the Company shall not be entitled to pay Interest in Interest
      Shares. Each Interest Election Notice shall be irrevocable. If the Company
      does
      not timely provide such written notice in accordance with this Section 2, then
      the Company shall be deemed to have delivered an irrevocable Interest Election
      Notice confirming an election by the Company to pay such interest in shares
      of
      Common Stock and shall be deemed to have certified that the Equity Conditions
      have been satisfied. All interest payable on any Interest Payment Date must
      be
      paid in the same manner with respect to all of the Debentures.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    (b) If
      the
      Equity Conditions are not satisfied as of the Interest Election Notice Date,
      then unless the Company has elected to pay such Interest as Cash Interest,
      the
      Interest Election Notice shall indicate that, unless the Holder waives the
      Equity Conditions, the Interest shall be paid as Cash Interest. If the Equity
      Conditions were satisfied as of the Interest Election Notice Date but the Equity
      Conditions are no longer satisfied at any time prior to the Interest Date,
      the
      Company shall provide the Holder a subsequent notice to that effect indicating
      that, unless the Holder waives the Equity Conditions, the Interest shall be
      paid
      in cash. If the Company is required but fails to pay interest in cash on any
      Interest Payment Date, the Holder may (but shall not be required to), by notice
      to the Company, treat such interest as if it had been accreted to the principal
      amount of this Debenture as of such Interest Payment Date.

     

    (c) By
      the
      third Trading Day after each Interest Payment Date (the "Interest
      Share Delivery Date"),
      the
      Company shall issue or cause to be issued and cause to be delivered to or upon
      the written order of the Holder and in such name or names as the Holder may
      designate a certificate for the Interest Shares issuable on such Interest
      Payment Date which, unless required by the Purchase Agreement, shall be free
      of
      all restrictive legends. If the Company’s transfer agent is eligible to
      participate in the Depositary Trust Corporation DWAC system and no legends
      are
      required to be included on the certificates representing Interest Shares
      pursuant to the Purchase Agreement, the Company shall, upon request of the
      Holder, use its best efforts to deliver Interest Shares hereunder electronically
      through the Depository Trust Corporation or another established clearing
      corporation performing similar functions.

     

    (d) Prior
      to
      the payment of interest on any Interest Payment Date, interest on this Debenture
      shall accrue at the Interest Rate and be payable by way of inclusion of the
      interest in any principal amount converted in accordance with Section 5. From
      and after the occurrence and during the continuance of an Event of Default,
      the
      Interest Rate shall be increased to the applicable Default Rate. In the event
      that such Event of Default is subsequently cured, the adjustment referred to
      in
      the preceding sentence shall cease to be effective as of the date of such cure;
      provided that the Interest as calculated and unpaid at such increased Default
      Rate during the continuance of such Event of Default shall continue to apply
      to
      the extent relating to the days after the occurrence of such Event of Default
      through and including the date of cure of such Event of Default. The Company
      shall pay any and all taxes that may be payable with respect to the issuance
      and
      delivery of Interest Shares; provided
      that the
      Company shall not be required to pay any tax that may be payable in respect
      of
      any issuance of Interest Shares to any Person other than the
      Holder.

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

     

    3. Registration
      of Debentures.
      The
      Company shall maintain a register (the “Debenture
      Register”)
      for
      the recordation of the names and addresses of the holders of each Debenture
      and
      the principal amount of the Debentures held by such holders (the "Registered
      Debentures").
      The
      entries in the Debenture Register shall be conclusive and binding for all
      purposes absent manifest error. The Company and the holders of the Debentures
      shall deem and treat the registered Holder as the absolute owner hereof for
      the
      purpose of any conversion hereof or any payment of interest hereon, and for
      all
      other purposes, notwithstanding notice to the contrary.

     

    4. Registration
      of Transfers and Exchanges.
      A
      Registered Debenture may be assigned or sold in whole or in part only by
      registration of such assignment or sale on the Debenture Register. The Company
      shall register the transfer of any portion of this Debenture in the Debenture
      Register upon surrender of this Debenture to the Company at its address for
      notice set forth herein. Upon any such registration or transfer, a new
      Registered Debenture, in substantially the form of this Debenture (any such
      new
      debenture, a “New
      Debenture”),
      evidencing the portion of this Debenture so transferred to be issued to the
      transferee and a New Debenture evidencing the remaining portion of this
      Debenture not so transferred, if any, to be issued to the transferring Holder.
      The acceptance of the New Debenture by the transferee thereof shall be deemed
      the acceptance by such transferee of all of the rights and obligations of a
      holder of a Debenture. This Debenture is exchangeable for an equal aggregate
      principal amount of Debentures of different authorized denominations, as
      requested by the Holder surrendering the same. No service charge or other fee
      will be imposed in connection with any such registration of transfer or
      exchange. Transfers of this Debenture and the Underlying Shares issuable on
      conversion thereof hereby are governed by Section 2(f) of the Purchase
      Agreement.

     

    5. Conversion
      

     

    (a) At
      the
      option of the Holder.
      The
      principal amount of this Debenture then outstanding is convertible into shares
      of Common Stock at the Conversion Price (subject to limitations set forth in
      Section 5(d)), at the option of the Holder, at any time and from time to time
      from and after the Original Issue Date. Holders shall effect conversions under
      this Section 5(a), by delivering to the Company a Holder Conversion Notice
      together with a schedule in the form of Schedule
      1
      attached
      hereto (the “Conversion
      Schedule”).
      The
      number of Underlying Shares issuable upon any conversion hereunder shall
      (subject to limitations set forth in Section 5(d)) equal the outstanding
      principal amount of this Debenture to be converted, plus any accrued and unpaid
      interest thereon, divided by the Initial Conversion Price. If the Holder is
      converting less than all of the principal amount represented by this Debenture,
      or if a conversion hereunder may not be effected in full due to the application
      of Section 5(d)(i), the Company shall honor such conversion to the extent
      permissible hereunder and shall promptly deliver to the Holder a Conversion
      Schedule indicating the principal amount which has not been converted. In
      addition, at any time after the earlier of the Effective Date or June 15, 2007,
      the Holder shall have the option (subject to limitations set forth in this
      Section 5(a) and in Section 5(d)), upon the delivery of a Holder Conversion
      Notice to the Company, to cause the adjustment of the Conversion Price then
      in
      effect with respect to the Debentures being converted pursuant to such Holder
      Conversion Notice to equal the Revised Conversion Price; provided,
      however,
      that
      such option shall be limited to an aggregate principal amount not to exceed
      the
      Early Conversion Amount during any 10 Trading Day period unless the Company
      otherwise agrees in writing. The Company shall have the one-time right to deny
      the Holder's exercise of its right to such adjustment for a period not to exceed
      20 Trading Days so long as the Company has notified the Holder (the
      "Adjustment
      Denial Notice")
      in
      writing thereof at least two Trading Days prior to the commencement of such
      20
      Trading Day period. For the avoidance of doubt, in the event that the Company
      delivers the Adjustment Denial Notice to the Holder after the delivery by the
      Holder of a Holder Conversion Notice, the Holder shall still be entitled to
      convert any principal amount set forth in such Holder Conversion Notice at
      the
      Revised Conversion Price.

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    (b) At
      the
      option of the Company.
      Subject
      to the conditions set forth in this Section 5(b) and Section 5(d), at any time
      after the first year anniversary of the Effective Date, the Company may require
      a conversion of principal amount of this Debenture, plus any accrued and unpaid
      interest thereon on the Company Election Conversion Date, of all or a portion
      of
      the outstanding principal amount of this Debenture if: (i) the Closing Price
      for
      each of 15 consecutive Trading Days immediately preceding the Company Conversion
      Notice Date (as defined below) is equal to or greater than 135% of the Initial
      Conversion Price and (ii) there has been no Equity Conditions Failure. The
      Company shall exercise its right to require conversions hereunder by delivering
      to the Holder a Company Conversion Notice (and the date such notice is received
      by the Holder, the "Company
      Conversion Notice Date")
      together with a Conversion Schedule that shall indicate (A) the aggregate amount
      of such Debentures the Company has selected for conversion, (B) the date
      selected by the Company for conversion (the "Company
      Election Conversion Date"),
      which
      date shall not be less than twenty (20) Trading Days or more than sixty (60)
      Trading Days after the Company Conversion Notice Date and (C) the Holder
      Pro-Rata Amount. Notwithstanding anything herein to the contrary, if any of
      the
      conditions set forth in clause (ii) herein shall cease to be satisfied during
      the period between the date of the delivery of the Company Conversion Notice
      and
      the Company Election Conversion Date, then the Holder may elect, by written
      notice to the Company given at any time after any such conditions shall cease
      to
      be satisfied, to invalidate ab
      initio
      such
      conversion. The number of Underlying Shares issuable upon any conversion
      hereunder shall (subject to limitations set forth in Section 5(d)) equal the
      outstanding principal amount of this Debenture to be converted (including any
      interest payments accreted to principal pursuant to the terms hereof) divided
      by
      the Initial Conversion Price. The conversion subject to each Company Conversion
      Notice, once given, shall be irrevocable as to the Company. If the conversion
      of
      a principal amount of Debentures indicated in a Company Conversion Notice would
      result in the issuance to the Holder of Underlying Shares in excess of the
      amount permitted pursuant to Section 5(d)(i) and/or Section 5(d)(ii), the
      Company shall: (x) honor the conversion for the maximum principal amount of
      Debentures permitted, pursuant to Section 5(d)(i) and/or Section 5(d)(ii),
      to be
      converted on such Company Election Conversion Date and (y) cancel the Company
      Conversion Notice with respect to the portion of the principal amount of
      Debentures the conversion of which would exceed the amount permitted under
      Section 5(d)(i) and/or Section 5(d)(ii). If the Company elects to cause a
      conversion of this Debenture pursuant to this Section 5(b), then it must
      simultaneously take the same action in the same proportion with respect to
      the
      other Debentures.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    (c) Company’s
      option to adjust Conversion Price and force conversion.
      Subject
      to the conditions set forth in this Section 5(c) and Section 5(d), at any time
      and from time to time after the Effective Date, the Company shall have the
      option to require that up to the Holder Pro Rata Amount of the Mandatory
      Convertible Amount be converted at the Revised Conversion Price provided that
      the Forced Conversion Conditions are satisfied or waived in writing by the
      Holder as of the Forced Conversion Notice Date. The Company shall exercise
      its
      rights hereunder by delivering to each holder of Debentures a Company Conversion
      Notice (a "Forced
      Conversion Notice")
      by
      facsimile between 4:00 p.m. and 6:00 p.m., New York Time on any given date
      (followed by notice by overnight courier). Notwithstanding anything herein
      to
      the contrary, if any of the Forced Conversion Conditions shall cease to be
      satisfied or in effect during the period between the date of the delivery of
      the
      Forced Conversion Notice and the Forced Conversion Date, then the Holder may
      elect, by written notice to the Company given at any time after any such
      conditions shall cease to be in effect, to invalidate ab
      initio
      such
      conversion. Subject to the terms hereof (including, without limitation, Section
      5(d)(i) and (ii)), on each Forced Conversion Date immediately following the
      delivery of such Forced Conversion Notice, the applicable Mandatory Convertible
      Amount, plus any accrued and unpaid interest thereon, shall be converted into
      Underlying Shares at the Revised Conversion Price. Notwithstanding anything
      herein to the contrary, the Company shall not be entitled to deliver a Forced
      Conversion Notice prior to the tenth (10th)
      Trading
      Day immediately following the immediately preceding Forced Conversion Date
      hereunder or within 10 Trading Days of a Company Election Conversion Date under
      Section 5(b). The conversion subject to each Forced Conversion Notice, once
      given, shall be irrevocable as to the Company. If a conversion of the Mandatory
      Convertible Amount would result in the issuance to the Holder of Underlying
      Shares in excess of the amount permitted pursuant to Section 5(d)(i) and/or
      Section 5(d)(ii), the Company shall: (x) honor the conversion for the maximum
      principal amount of Debentures permitted, pursuant to Section 5(d)(i) and/or
      Section 5(d)(ii), to be converted on the applicable Forced Conversion Date
      and
      (y) cancel the Forced Conversion Notice and conversion as to the portion of
      the
      Mandatory Convertible Amount the conversion of which would exceed the amount
      permitted pursuant to Section 5(d)(i) and/or Section 5(d)(ii). If the Company
      elects to cause a conversion of this Debenture pursuant to this Section 5(c),
      then it must simultaneously take the same action in the same proportion with
      respect to the other Debentures.

     

    (d) Certain
      Conversion Restrictions.
      

     

    (i) Notwithstanding
      anything to the contrary contained herein, the Company shall not effect any
      conversion of this Debenture, and the Holder of this Debenture shall not have
      the right to convert any portion of this Debenture pursuant to Section 5(a),
      to
      the extent that after giving effect to such conversion, the Holder (together
      with the Holder's affiliates) would beneficially own in excess of 4.99% (the
      "Maximum
      Percentage")
      of the
      number of shares of Common Stock outstanding immediately after giving effect
      to
      such conversion. For purposes of the foregoing sentence, the number of shares
      of
      Common Stock beneficially owned by the Holder and its affiliates shall include
      the number of shares of Common Stock issuable upon conversion of this Debenture
      with respect to which the determination of such sentence is being made, but
      shall exclude the number of shares of Common Stock which would be issuable
      upon
      (A) conversion of the remaining, unconverted portion of this Debenture
      beneficially owned by the Holder or any of its affiliates and (B) exercise
      or
      conversion of the unexercised or nonconverted portion of any other securities
      of
      the Company (including, without limitation, any other Debentures or warrants)
      subject to a limitation on conversion or exercise analogous to the limitation
      contained in this Section beneficially owned by the Holder or any of its
      affiliates. Except as set forth in the preceding sentence, for purposes of
      this
      Section 5(d)(i), beneficial ownership shall be determined in accordance with
      Section 13(d) of the Exchange Act. For purposes of this Section 5(d)(i), in
      determining the number of outstanding shares of Common Stock, the Holder may
      rely on the number of outstanding shares of Common Stock as reflected in (x)
      the
      Company's most recent Form 10-K, Form 10-Q, Form 8-K or other public filing
      with
      the Commission, as the case may be, (y) a more recent public announcement by
      the
      Company or (z) any other notice by the Company or the Transfer Agent setting
      forth the number of shares of Common Stock outstanding. Upon the written request
      of the Holder, the Company shall within two (2) Business Days confirm orally
      and
      in writing to the Holder the number of shares of Common Stock then outstanding.
      In any case, the number of outstanding shares of Common Stock shall be
      determined after giving effect to the conversion or exercise of securities
      of
      the Company, including this Debenture and the Warrants, by the Holder or its
      affiliates since the date as of which such number of outstanding shares of
      Common Stock was reported. By written notice to the Company, the Holder may
      increase or decrease the Maximum Percentage to any other percentage not in
      excess of 9.99% specified in such notice; provided that (i) any such increase
      or
      decrease will not be effective until the sixty-first (61st)
      day
      after such notice is delivered to the Company, and (ii) any such increase or
      decrease will apply only to the Holder and not to any other holder of
      Debentures. This provision shall not restrict the number of shares of Common
      Stock which a Holder may receive or beneficially own in order to determine
      the
      amount of securities or other consideration that such Holder may receive in
      the
      event of a merger, sale or other business combination or reclassification
      involving the Company as contemplated herein. 

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    (ii) Notwithstanding
      anything to the contrary herein, the Company shall not be obligated to issue
      any
      shares of Common Stock upon conversion of this Debenture or exercise of the
      Warrants if the issuance of such shares of Common Stock would exceed that
      aggregate number of shares of Common Stock which the Company may issue upon
      conversion or exercise, as applicable, of the Debentures and Warrants without
      breaching the Company's obligations under the rules or regulations of the
      Principal Market (the "Exchange
      Cap"),
      except that such limitation shall not apply in the event that the Company (A)
      obtains the approval of its stockholders as required by the applicable rules
      of
      the Principal Market (or any successor rule or regulation) for issuances of
      shares of Common Stock in excess of such amount or (B) obtains a written opinion
      from outside counsel to the Company that such approval is not required, which
      opinion shall be reasonably satisfactory to the Majority Holders. Until such
      approval or written opinion is obtained, no purchaser of the Debentures pursuant
      to the Purchase Agreement (the "Purchasers")
      shall
      be issued in the aggregate, upon conversion of the Debentures or exercise of
      the
      Warrants, shares of Common Stock in an amount greater than the product of (1)
      the Exchange Cap amount multiplied by (2) a fraction, the numerator of which
      is
      the principal amount of Debentures issued to such Purchaser pursuant to the
      Purchase Agreement on the Original Issue Date and the denominator of which
      is
      the aggregate principal amount of all Debentures issued to the Purchasers
      pursuant to the Purchase Agreement on the Original Issue Date (the "Exchange
      Cap Allocation").
      In
      the event that any Purchaser shall sell or otherwise transfer any of such
      Purchaser's Debentures, the transferee shall be allocated a pro rata portion
      of
      such Purchaser's Exchange Cap Allocation. In the event that any holder of
      Debentures shall convert all of such holder's Debentures into a number of shares
      of Common Stock which, in the aggregate, is less than such holder's Exchange
      Cap
      Allocation, then the difference between such holder's Exchange Cap Allocation
      and the number of shares of Common Stock actually issued to such holder shall
      be
      allocated to the respective Exchange Cap Allocations of the remaining holders
      of
      Debentures on a pro rata basis in proportion to the aggregate principal amount
      of the Debentures then held by each such holder.

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    (e) Mechanics
      of Conversion.
      

     

    (i) By
      each
      applicable Conversion Date, the Company shall issue or cause to be issued and
      cause to be delivered to or upon the written order of the Holder and in such
      name or names as the Holder may designate a certificate for the Underlying
      Shares issuable upon such conversion which, unless required by the Purchase
      Agreement, shall be free of all restrictive legends. The Holder, or any Person
      so designated by the Holder to receive Underlying Shares, shall be deemed to
      have become the holder of record of such Underlying Shares as of the Conversion
      Date. If the Company’s transfer agent is eligible to participate in the
      Depositary Trust Corporation ("DTC")
      DWAC
      system and no legends are required to be included on the certificates
      representing Underlying Shares pursuant to the Purchase Agreement, the Company
      shall, upon request of the Holder, use its best efforts to deliver Underlying
      Shares hereunder electronically through the Depository Trust Corporation or
      another established clearing corporation performing similar
      functions.

     

    (ii) In
      the
      event that (A) the Company receives a Holder Conversion Notice from more than
      one holder of Debentures for the same Conversion Date and the Company can
      convert some, but not all, of such portions of the Debentures submitted for
      conversion, the Company, subject to Section 5(d), shall convert from each holder
      of Debentures electing to have Debentures converted on such date a pro rata
      amount of such holder's portion of its Debentures submitted for conversion
      based
      on the principal amount of Debentures submitted for conversion on such date
      by
      such holder relative to the aggregate principal amount of all Debentures
      submitted for conversion on such date or (B) the Company requires conversion
      of
      some, but not all, of the Debentures pursuant to Sections 5(b) or 5(c) on any
      applicable Conversion Date, the Company, subject to Section 5(d), shall convert
      from each holder of Debentures a pro rata amount of such holder's portion of
      its
      Debentures submitted for conversion based on the principal amount of Debentures
      outstanding on such date by such holder relative to the aggregate principal
      amount of all Debentures outstanding on such date.

     

    (f) To
      effect
      conversions hereunder, the Holder shall not be required to physically surrender
      this Debenture unless the aggregate principal amount represented by such
      Debenture is being converted, in which event, the Holder shall deliver such
      Debenture promptly to the Company (it being understood that such delivery is
      not
      a condition precedent to the Company’s obligations to deliver Underlying Shares
      upon such conversion). Conversions hereunder shall have the effect of lowering
      the outstanding principal amount represented by such Debenture in an amount
      equal to the applicable conversion, which shall be evidenced by entries set
      forth in the Conversion Schedule which will be maintained by the Company and
      the
      Holder and be binding on both parties absent manifest error.

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

     

    (g) The
      Company’s obligations to issue and deliver Underlying Shares upon conversion of
      this Debenture in accordance with the terms hereof (including, without
      limitations, Section 5(d)) are absolute and unconditional, irrespective of
      any
      action or inaction by the Holder to enforce the same, any waiver or consent
      with
      respect to any provision hereof, the recovery of any judgment against any Person
      or any action to enforce the same, or any setoff, counterclaim, recoupment,
      limitation or termination, or any breach or alleged breach by the Holder or
      any
      other Person of any obligation to the Company or any violation or alleged
      violation of law by the Holder or any other Person, and irrespective of any
      other circumstance which might otherwise limit such obligation of the Company
      to
      the Holder in connection with the issuance of such Underlying Shares.

     

    (h) If
      by the
      third Trading Day after a Conversion Date the Company fails to deliver to the
      Holder such Underlying Shares in such amounts and in the manner required
      pursuant to Section 5(e), then the Holder will have the right to rescind such
      conversion.

     

    (i) If
      as of
      any Conversion Date, the Company shall fail to issue and deliver a certificate
      to the Holder or credit the Holder's balance account with DTC for the Underlying
      Shares to which the Holder is entitled upon such holder's conversion or the
      Company's conversion, as applicable, of any principal amount,
      and if
      on or after such Trading Day the Holder purchases (in an open market transaction
      or otherwise) shares of Common Stock to deliver in satisfaction of a sale by
      the
      Holder of shares of Common Stock issuable upon such conversion that the Holder
      anticipated receiving from the Company (a "Buy-In"),
      then
      the Company shall, within three (3) Trading Days after the Holder's request
      and
      in the Holder's discretion, either (A) pay cash to the Holder in an amount
      equal
      to the Holder's total purchase price (including reasonable brokerage
      commissions, if any) for the shares of Common Stock so purchased (the
"Buy-In
      Price"),
      at
      which point the Company's obligation to deliver such certificate (and to issue
      such Common Stock) shall terminate, or (B) promptly honor its obligation to
      deliver to the Holder a certificate or certificates, or credit the Holder's
      balance account with DTC, for such Common Stock and pay cash to the Holder
      in an
      amount equal to the excess (if any) of the Buy-In Price over the product of
      (1)
      such number of shares of Common Stock, times (2) the Closing Price on the
      applicable Conversion Date.

     

    (j) Adjustments
      to Conversion Price.
      The
      Conversion Price in effect on any Conversion Date shall be subject to
      adjustments in accordance with this Section 5(j):

     

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

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

     

    (ii) Adjustment
      of Conversion Price upon Issuance of Shares of Common Stock.
      If and
      whenever on or after the Subscription Date, the Company issues or sells, or
      in
      accordance with this Section 5(j)(ii) is deemed to have issued or sold, any
      shares
      of
Common
      Stock (including the issuance or sale of shares
      of
Common
      Stock owned or held by or for the account of the Company, but excluding
shares
      of
Common
      Stock deemed to have been issued or sold by the Company in connection with
      any
      Excluded Security) for a consideration per share less than a price (the
      "Applicable
      Price")
      equal
      to the Conversion Price in effect immediately prior to such issue or sale (the
      foregoing a "Dilutive
      Issuance"),
      then
      immediately after such Dilutive Issuance, the Conversion Price then in effect
      shall be reduced to an amount equal to the
      product of (A) the Conversion Price in effect immediately prior to such
      Dilutive Issuance and (B) the quotient determined by dividing (1) the
      sum of (I) the product derived by multiplying the Conversion Price in effect
      immediately prior to such Dilutive Issuance and the number of shares of Common
      Stock Deemed Outstanding immediately prior to such Dilutive Issuance plus
      (II) the consideration, if any, received by the Company upon such Dilutive
      Issuance, by (2) the product derived by multiplying (I) the Applicable
      Price in effect immediately prior to such Dilutive Issuance by (II) the
      number of shares of Common Stock Deemed Outstanding immediately after such
      Dilutive Issuance. For
      purposes of determining the adjusted Conversion Price under this Section 7(a),
      the following shall be applicable:

     

    (a) Issuance
      of Options.
      If the
      Company in any manner grants or sells any Options and the lowest price per
      share
      for which one share
      of
Common
      Stock is issuable upon the exercise of any such Option or upon conversion or
      exchange or exercise of any Convertible Securities issuable upon exercise of
      such Option is less than the Applicable Price, then such share
      of
Common
      Stock shall be deemed to be outstanding and to have been issued and sold by
      the
      Company at the time of the granting or sale of such Option for such price per
      share. For purposes of this Section 5(j)(ii)(A), the "lowest price per share
      for
      which one share
      of
Common
      Stock is issuable upon the exercise of any such Option or upon conversion or
      exchange or exercise of any Convertible Securities issuable upon exercise of
      such Option" shall be equal to the sum of the lowest amounts of consideration
      (if any) received or receivable by the Company with respect to any one
share
      of
Common
      Stock upon the granting or sale of the Option, upon exercise of the Option
      and
      upon conversion or exchange or exercise of any Convertible Security issuable
      upon exercise of such Option. No further adjustment of the Conversion Price
      shall be made upon the actual issuance of such shares of Common Stock or of
      such
      Convertible Securities upon the exercise of such Options or upon the actual
      issuance of such shares of Common Stock upon conversion or exchange or exercise
      of such Convertible Securities.

     

    (b) Issuance
      of Convertible Securities.
      If the
      Company in any manner issues or sells any Convertible Securities and the lowest
      price per share for which one share of Common Stock is issuable upon such
      conversion or exchange or exercise thereof is less than the Applicable Price,
      then such share of Common Stock shall be deemed to be outstanding and to have
      been issued and sold by the Company at the time of the issuance or sale of
      such
      Convertible Securities for such price per share. For the purposes of this
      Section 5(j)(ii)(A), the "lowest price per share for which one share of Common
      Stock is issuable upon such conversion or exchange or exercise" shall be equal
      to the sum of the lowest amounts of consideration (if any) received or
      receivable by the Company with respect to any one share of Common Stock upon
      the
      issuance or sale of the Convertible Security and upon the conversion or exchange
      or exercise of such Convertible Security. No further adjustment of the
      Conversion Price shall be made upon the actual issuance of such shares of Common
      Stock upon conversion or exchange or exercise of such Convertible Securities,
      and if any such issue or sale of such Convertible Securities is made upon
      exercise of any Options for which adjustment of the Conversion Price had been
      or
      are to be made pursuant to other provisions of this Section 5(j)(ii), no further
      adjustment of the Conversion Price shall be made by reason of such issue or
      sale.

     

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

     

    (c) Change
      in Option Price or Rate of Conversion.
      If the
      purchase price provided for in any Options, the additional consideration, if
      any, payable upon the issue, conversion, exchange or exercise of any Convertible
      Securities, or the rate at which any Convertible Securities are convertible
      into
      or exchangeable or exercisable for Common Stock increases or decreases at any
      time, the Conversion Price in effect at the time of such increase or decrease
      shall be adjusted to the Conversion Price which would have been in effect at
      such time had such Options or Convertible Securities provided for such changed
      purchase price, additional consideration or changed conversion rate, as the
      case
      may be, at the time initially granted, issued or sold. For purposes of this
      Section 5(j)(ii)(C), if the terms of any Option or Convertible Security that
      was
      outstanding as of the Subscription Date are changed in the manner described
      in
      the immediately preceding sentence, then such Option or Convertible Security
      and
      the Common Stock deemed issuable upon exercise, conversion or exchange thereof
      shall be deemed to have been issued as of the date of such increase or decrease.
      No adjustment shall be made if such adjustment would result in an increase
      of
      the Conversion Price then in effect.

     

    (d) Calculation
      of Consideration Received.
      In case
      any Option is issued in connection with the issue or sale of other securities
      of
      the Company, together comprising one integrated transaction in which no specific
      consideration is allocated to such Options by the parties thereto, the Options
      will be deemed to have been issued for a consideration of $0.01. If any shares
      of Common Stock, Options or Convertible Securities are issued or sold or deemed
      to have been issued or sold for cash, such consideration other than cash
      received therefor will be deemed to be the net amount received by the Company
      therefor. If any shares of Common Stock, Options or Convertible Securities
      are
      issued or sold for a consideration other than cash, the amount of the
      consideration other than cash received by the Company will be the fair value
      of
      such consideration, except where such consideration consists of securities,
      in
      which case the amount of consideration received by the Company will be the
      Closing Sale Price of such securities on the date of receipt. If any Common
      Stock, Options or Convertible Securities are issued to the stockholders of
      the
      non-surviving entity in connection with any merger in which the Company is
      the
      surviving entity, the amount of consideration therefor will be deemed to be
      the
      fair value of such portion of the net assets and business of the non-surviving
      entity as is attributable to such Common Stock, Options or Convertible
      Securities, as the case may be. The fair value of any consideration other than
      cash or securities will be determined jointly by the Company and the Majority
      Holders. If such parties are unable to reach agreement within ten (10) days
      after the occurrence of an event requiring valuation (the "Valuation
      Event"),
      the
      fair value of such consideration will be determined within five (5) Business
      Days after the tenth day following the Valuation Event by an independent,
      reputable appraiser jointly selected by the Company and the Majority Holders.
      The determination of such appraiser shall be final and deemed binding upon
      all
      parties absent manifest error. The reasonable expenses of such appraiser in
      making such determination shall be paid by the Company in the event the holders'
      calculation was correct, or by the holders in the event the Company's
      calculation was correct, or equally by the Company and the holders in the event
      that neither the Company's or the holders' calculation was correct.

     

    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

     

    (e) Record
      Date.
      If the
      Company takes a record of the holders of shares of Common Stock for the purpose
      of entitling them (A) to receive a dividend or other distribution payable in
      shares of Common Stock, Options or in Convertible Securities or (B) to subscribe
      for or purchase shares of Common Stock, Options or Convertible Securities,
      then
      such record date will be deemed to be the date of the issue or sale of the
      shares of Common Stock deemed to have been issued or sold upon the declaration
      of such dividend or the making of such other distribution or the date of the
      granting of such right of subscription or purchase, as the case may
      be.

     

    (iii) Other
      Events.
      If any
      event occurs of the type contemplated by the provisions of this Section 5(j)
      but
      not expressly provided for by such provisions (including, without limitation,
      the granting of stock appreciation rights, phantom stock rights or other rights
      with equity features), then the Company's Board of Directors will make an
      appropriate adjustment in the Conversion Price so as to protect the rights
      of
      the Holder under this Debenture; provided that no such adjustment pursuant
      to
      this Section 5(j)(iii) will increase the Conversion Price as otherwise
      determined pursuant to this Section 5(j).

     

    (iv) Calculations.
      All
      calculations under this Section 5(j) shall be made to the nearest cent or the
      nearest 1/100th of a share, as the case may be. The number of shares of Common
      Stock outstanding at any given time shall not include shares owned or held
      by or
      for the account of the Company, and the disposition of any such shares shall
      be
      considered an issue or sale of Common Stock.

     

    (v) Notice
      of Adjustments.
      Whenever the Conversion Price is adjusted pursuant to the terms hereof the
      Company shall promptly mail to each Holder, a notice setting forth the
      Conversion Price after such adjustment and setting forth a brief statement
      of
      the facts requiring such adjustment.

     

    (k) Assumption.
      The
      Company shall not enter into or be party to a Fundamental Transaction unless
      (i)  the Successor Entity assumes in writing all of the obligations of the
      Company under this Debenture and the other Transaction Documents in accordance
      with the provisions of this Section 5(k) pursuant to written agreements in
      connection with the closing of such Fundamental Transaction, including
      agreements to deliver to each holder of Debentures in exchange for such
      Debentures a security of the Successor Entity evidenced by a written instrument
      substantially similar in form and substance to the Debentures, including,
      without limitation, having a principal amount and interest rate equal to the
      principal amounts then outstanding and the interest rates of the Debentures
      held
      by such holder, having similar conversion rights as the Debentures and having
      similar ranking to the Debentures, and (ii) the Successor Entity (including
      its Parent Entity) is a publicly traded corporation whose common stock is quoted
      on or listed for trading on an Eligible Market. Upon the occurrence of any
      Fundamental Transaction, the Successor Entity shall succeed to, and be
      substituted for (so that from and after the date of such Fundamental
      Transaction, the provisions of this Debenture referring to the "Company" shall
      refer instead to the Successor Entity), and may exercise every right and power
      of the Company and shall assume all of the obligations of the Company under
      this
      Debenture with the same effect as if such Successor Entity had been named as
      the
      Company herein. Upon consummation of the Fundamental Transaction, the Successor
      Entity shall deliver to the Holder confirmation that there shall be issued
      upon
      conversion or redemption of this Debenture at
      any
      time after the consummation of the Fundamental Transaction, in lieu of the
      shares of the Company's Common Stock (or
      other
      securities, cash, assets or other property) issuable
      upon the conversion or redemption of the Debentures prior to such Fundamental
      Transaction,
      such
      shares of the publicly traded Common Stock (or its equivalent) of the Successor
      Entity (including its Parent Entity) which the Holder would have been entitled
      to receive upon the happening of such Fundamental Transaction had this Debenture
      been converted immediately prior to such Fundamental Transaction, as adjusted
      in
      accordance with the provisions of this Debenture. The
      provisions of this Section shall apply similarly and equally to successive
      Fundamental Transactions and shall be applied without regard to any limitations
      on the conversion or redemption of this Debenture.

     

    
      
        
        

      

      
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    (l) Other
      Corporate Events.
      In
      addition to and not in substitution for any other rights hereunder, prior to
      the
      consummation of any Fundamental Transaction pursuant to which holders of shares
      of Common Stock are entitled to receive securities or other assets with respect
      to or in exchange for shares of Common Stock (a "Corporate
      Event"),
      the
      Company shall make appropriate provision to insure that the Holder will
      thereafter have the right to receive upon a conversion of this Debenture, (i)
      in
      addition to the shares of Common Stock receivable upon such conversion, such
      securities or other assets to which the Holder would have been entitled with
      respect to such shares of Common Stock had such shares of Common Stock been
      held
      by the Holder upon the consummation of such Corporate Event (without taking
      into
      account any limitations or restrictions on the convertibility of this Debenture)
      or (ii) in lieu of the shares of Common Stock otherwise receivable upon such
      conversion, such securities or other assets received by the holders of shares
      of
      Common Stock in connection with the consummation of such Corporate Event in
      such
      amounts as the Holder would have been entitled to receive had this Debenture
      initially been issued with conversion rights for the form of such consideration
      (as opposed to shares of Common Stock) at a conversion rate for such
      consideration commensurate with the Conversion Rate. Provision made pursuant
      to
      the preceding sentence shall be in a form and substance satisfactory to the
      Majority Holders. The provisions of this Section shall apply similarly and
      equally to successive Corporate Events and shall be applied without regard
      to
      any limitations on the conversion or redemption of this Debenture.

     

    (m) Purchase
      Rights.
      In
      addition to any adjustments pursuant to Section 5(j) above, if at any time
      the
      Company grants, issues or sells any Options, Convertible Securities or rights
      to
      purchase stock, warrants, securities or other property pro rata to the record
      holders of any class of shares of Common Stock (the "Purchase
      Rights"),
      then
      the Holder will be entitled to acquire, upon the terms applicable to such
      Purchase Rights, the aggregate Purchase Rights which the Holder could have
      acquired if the Holder had held the number of shares of Common Stock acquirable
      upon complete conversion of this Debenture (without regard to any limitations
      or
      restrictions on the convertibility of this Debenture) immediately before the
      date on which a record is taken for the grant, issuance or sale of such Purchase
      Rights, or, if no such record is taken, the date as of which the record holders
      of shares of Common Stock are to be determined for the grant, issue or sale
      of
      such Purchase Rights.

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

     

    (n) Participation.
      The
      Holder, as the holder of this Debenture, shall be entitled to receive such
      dividends paid and distributions made to the holders of Common Stock to the
      same
      extent as if the Holder had converted this Debenture into Common Stock (without
      regard to any limitations on conversion herein or elsewhere) and had held such
      shares of Common Stock on the record date for such dividends and distributions.
      Payments under the preceding sentence shall be made concurrently with the
      dividend or distribution to the holders of Common Stock.

     

    (o) Notice
      of Events.
      If (a)
      the Company shall declare a dividend (or any other distribution) on the Common
      Stock, (b) the Company shall declare a special nonrecurring cash dividend on
      or
      a redemption of the Common Stock, (c) the Company shall authorize the granting
      to all holders of Common Stock any Purchase Rights, (d) the approval of any
      stockholders of the Company shall be required in connection with any Change
      of
      Control transaction or Fundamental Transaction, (e) the entering into an
      agreement to effectuate a Change of Control transaction or Fundamental
      Transaction, or (f) the Company shall authorize the Liquidation of the Company;
      then the Company shall file a press release or Current Report on Form 8-K to
      disclose such occurrence and notify the holders at their last addresses as
      they
      shall appear upon the stock books of the Company, at least 20 calendar days
      prior to the applicable record or effective date hereinafter specified, a notice
      stating (x) the date on which a record is to be taken for the purpose of such
      dividend, distribution, redemption, 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, distributions, redemption, rights or warrants are
      to
      be determined or (y) the date on which any such Change of Control transaction
      or
      Fundamental Transaction is expected to become effective or close, and the date
      as of which it is expected that holders of Common Stock of record shall be
      entitled to exchange their Common Stock for securities, cash or other property
      deliverable upon any such Change of Control Transaction or Fundamental
      Transaction. A Holder is entitled to convert principal amount of this Debenture
      during the 20-day period commencing the date of such notice to the effective
      date of the event triggering such notice.

     

    (p) Reservation
      of Authorized Shares.
      

     

    (i) Reservation.
      The
      Company shall initially reserve out of its authorized and unissued Common Stock
      a number of shares of Common Stock for each of the Debentures equal to 130%
      of
      the Conversion Rate with respect to the principal amount of each such Debenture
      as of the Original Issue Date.
      So
      long as any of the Debentures are outstanding, the Company shall take all action
      necessary to reserve and keep available out of its authorized and unissued
      Common Stock, solely for the purpose of effecting the conversion of the
      Debentures, 130% of the number of shares of Common Stock as shall from time
      to
      time be necessary to effect the conversion of all of the Debentures then
      outstanding; provided that at no time shall the number of shares of Common
      Stock
      so reserved be less than the number of shares required to be reserved by the
      previous sentence (without regard to any limitations on conversions) (the
      "Required
      Reserve Amount").
      The
      initial number of shares of Common Stock reserved for conversions of the
      Debentures and each increase in the number of shares so reserved shall be
      allocated pro rata among the holders of the Debentures based on the principal
      amount of the Debentures held by each holder on the Original Issue Date or
      increase in the number of reserved shares, as the case may be (the "Authorized
      Share Allocation").
      In
      the event that a holder shall sell or otherwise transfer any of such holder's
      Debentures, each transferee shall be allocated a pro rata portion of such
      holder's Authorized Share Allocation. Any shares of Common Stock reserved and
      allocated to any Person which ceases to hold any Debentures shall be allocated
      to the remaining holders of Debentures, pro rata based on the principal amount
      of the Debentures then held by such holders.

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

     

    (ii) Insufficient
      Authorized Shares.
      If at
      any time while any of the Debentures remain outstanding the Company does not
      have a sufficient number of authorized and unreserved shares of Common Stock
      to
      satisfy its obligation to reserve for issuance upon conversion of the Debentures
      at least a number of shares of Common Stock equal to the Required Reserve Amount
      (an "Authorized
      Share Failure"),
      then
      the Company shall immediately take all action necessary to increase the
      Company's authorized shares of Common Stock to an amount sufficient to allow
      the
      Company to reserve the Required Reserve Amount for the Debentures then
      outstanding. Without limiting the generality of the foregoing sentence, as
      soon
      as practicable after the date of the occurrence of an Authorized Share Failure,
      but in no event later than ninety (90) days after the occurrence of such
      Authorized Share Failure, the Company shall hold a meeting of its stockholders
      for the approval of an increase in the number of authorized shares of Common
      Stock. In connection with such meeting, the Company shall provide each
      stockholder with a proxy statement and shall use its best efforts to solicit
      its
      stockholders' approval of such increase in authorized shares of Common Stock
      and
      shall use its best efforts to cause its board of directors to recommend to
      the
      stockholders that they approve such proposal.

     

    (q) Fractional
      Shares.
      Upon a
      conversion hereunder the Company shall not be required to issue stock
      certificates representing fractions of shares of Common Stock, but may if
      otherwise permitted, make a cash payment in respect of any final fraction of
      a
      share based on the Closing Price on the applicable Conversion Date. If any
      fraction of an Underlying Share would, except for the provisions of this Section
      5(q), be issuable upon a conversion hereunder, the Company shall pay an amount
      in cash equal to the Conversion Price multiplied by such fraction.

     

    (r) Taxes.
      The
      issuance of certificates for Common Stock on conversion of principal amount
      of
      this Debenture shall be made without charge to the Holders thereof for any
      documentary stamp or similar taxes that may be payable in respect of the issue
      or delivery of such certificate, provided that the Company shall not be required
      to pay any tax that may be payable in respect of any transfer involved in the
      issuance and delivery of any such certificate upon conversion in a name other
      than that of the Holder of such Debentures so converted.

     

    (s) Noncircumvention.
      The
      Company hereby covenants and agrees that the Company will not, by amendment
      of
      its certificate of incorporation, bylaws or through any reorganization, transfer
      of assets, consolidation, merger, scheme of arrangement, dissolution, issue
      or
      sale of securities, or any other voluntary action, avoid or seek to avoid the
      observance or performance of any of the terms of this Debenture, and will at
      all
      times in good faith carry out all of the provisions of this Debenture and take
      all action as may be required to protect the rights of the Holder of this
      Debenture.

     

    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    

     

    (t) Notices
      and Communications.
      Any and
      all notices or other communications or deliveries to be provided by the holders
      of Debentures, including, without limitation, any Conversion Notice, shall
      be in
      writing and delivered personally, by facsimile or sent by a nationally
      recognized overnight courier service, addressed to the attention of the Chief
      Financial Officer of the Company addressed to 1 Industrial Way West, Eatontown,
      New Jersey, Facsimile No.: (732) 542-4010, or to such other address or facsimile
      number as shall be specified in writing by the Company for such purpose, with
      a
      copy to Dickstein Shapiro LLP, 1177 Avenue of the Americas, New York, NY 10036,
      Attention: Malcolm I. Ross, Esq., Facsimile Number (212) 391-7616. Any and
      all
      notices or other communications or deliveries to be provided by the Company
      hereunder shall be in writing and delivered personally, by facsimile or sent
      by
      a nationally recognized overnight courier service, addressed to the Holder
      at
      the facsimile telephone number or address of the Holder appearing on the books
      of the Company, or if no such facsimile telephone number or address appears,
      at
      the principal place of business of the Holder. Any notice or other communication
      or deliveries hereunder shall be deemed given and effective on the earliest
      of
      (i) the date of transmission, if such notice or communication is delivered
      via
      facsimile at the facsimile telephone number specified in this Section 5(q)
      prior
      to 6:59 p.m. (New York City time)(with confirmation of transmission), (ii)
      the
      date after the date of transmission, if such notice or communication is
      delivered via facsimile at the facsimile telephone number specified in this
      Section 5(q) later than 6:59 p.m. (New York City time) on any date and earlier
      than 11:59 p.m. (New York City time) on such date (with confirmation of
      transmission), (iii) upon receipt, if sent by a nationally recognized overnight
      courier service, or (iv) upon actual receipt by the party to whom such notice
      is
      required to be given.

     

    6. Redemptions.

     

    (a) Redemptions
      upon an Event of Default.
      Within
      one Business Day of the occurrence of an Event of Default, the Company shall
      deliver written notice thereof via facsimile and overnight courier (an
      "Event
      of Default Notice")
      to
      each holder of Debentures. At any time after the earlier of the Holder's receipt
      of an Event of Default Notice and such Holder becoming aware of an Event of
      Default, the Holder shall (in addition to all other rights it may have hereunder
      or under applicable law), have the right, exercisable at the sole option of
      the
      Holder and by delivery of a written notice to the Company, to require the
      Company (an “Event
      of Default Redemption Notice”)
      to
      redeem all or a portion of this Debenture and, at the option of the Holder,
      all
      or a portion of the Reinstated Principal, for an amount, in cash, equal to
      the
      Mandatory Redemption Amount. To the extent redemptions required by this Section
      6 are deemed or determined by a court of competent jurisdiction to be
      prepayments of the Debenture by the Company, such redemptions shall be deemed
      to
      be voluntary prepayments. The parties hereto agree that in the event of the
      Company's redemption of any portion of this Debenture under this Section 6,
      the
      Holder's damages would be uncertain and difficult to estimate because of the
      parties' inability to predict future interest rates and the uncertainty of
      the
      availability of a suitable substitute investment opportunity for the Holder.
      Accordingly, any redemption premium due under this Section 4(b) is intended
      by
      the parties to be, and shall be deemed, a reasonable estimate of the Holder's
      actual loss of its investment opportunity and not as a penalty.

     

    
      
        
        

      

      
        -29-

        
          

        

      

      
        
        

      

    

     

    (b) Redemptions
      upon Change of Control.
      No
      sooner than fifteen (15) days nor later than ten (10) days prior to the
      consummation of a Change of Control, but not prior to the public announcement
      of
      such Change of Control, the Company shall deliver written notice thereof via
      facsimile and overnight courier to the Holder (a "Change
      of Control Notice").
      At
      any time during the period beginning on the date of the Holder's receipt of
      a
      Change of Control Notice and ending twenty (20) Trading Days after the
      consummation of such Change of Control, the Holder may require the Company
      to
      redeem all or any portion of this Debenture by delivering written notice thereof
      ("Change
      of Control Redemption Notice")
      to the
      Company, which Change of Control Redemption Notice shall indicate the Conversion
      Amount the Holder is electing to redeem. The portion of this Debenture subject
      to redemption pursuant to this Section 6(b) shall be redeemed by the Company
      in
      cash at a price equal to the sum of (I) the greater of (i) the product of (x)
      the principal amount of Debentures to be redeemed plus all accrued and unpaid
      interest thereon and (y) the quotient determined by dividing (A) the greater
      of
      the Closing Price of the Common Stock immediately prior to the consummation
      of
      the Change of Control, the Closing Price immediately following the public
      announcement of such proposed Change of Control and the Closing Price of the
      Common Stock immediately prior to the public announcement of such proposed
      Change of Control by (B) the Conversion Price and (ii) 120% of the principal
      amount of Debentures to be redeemed plus all accrued and unpaid interest thereon
      and (II) all other amounts, costs, expenses and liquidated damages due in
      respect of such Debentures (the "Change
      of Control Redemption Price").
      The
      Company shall deliver the applicable Change of Control Redemption Price to
      the
      Holder concurrently with the consummation of such Change of Control if such
      notice is received prior to the consummation of such Change of Control and
      within five (5) Business Days after the Company's receipt of such notice
      otherwise. Redemptions required by this Section 6(b) shall have priority to
      payments to stockholders in connection with a Change of Control. To the extent
      redemptions required by this Section 6(b) are deemed or determined by a court
      of
      competent jurisdiction to be prepayments of the Debenture by the Company, such
      redemptions shall be deemed to be voluntary prepayments. Notwithstanding
      anything to the contrary in this Section 6, but subject to Section 5(d), until
      the Change of Control Redemption Price is paid in full, the principal amount
      of
      this Debenture submitted for redemption under this Section 6(b) may be
      converted, in whole or in part, by the Holder into Common Stock pursuant to
      Section 5(a). The parties hereto agree that in the event of the Company's
      redemption of any portion of the Debenture under this Section 6(b), the Holder's
      damages would be uncertain and difficult to estimate because of the parties'
      inability to predict future interest rates and the uncertainty of the
      availability of a suitable substitute investment opportunity for the Holder.
      Accordingly, any redemption premium due under this Section 6(b) is intended
      by
      the parties to be, and shall be deemed, a reasonable estimate of the Holder's
      actual loss of its investment opportunity and not as a penalty.

     

    (c) Holder's
      Right of Optional Redemption.
      In the
      event that any shares of Series C2 Preferred Stock remain outstanding as of
      March 31, 2008, the Holder shall thereafter have the right, in its sole
      discretion, to require that the Company redeem all or any portion of the
      outstanding principal amount of this Debenture by delivering written notice
      thereof to the Company (a "Holder Optional
      Redemption Notice").
      The
      Holder Redemption Notice shall indicate the principal amount of this Debenture
      that the Holder is electing to have redeemed (the "Holder
      Optional Redemption Amount")
      on the
      Holder Optional Redemption Date (as defined in Section 6(d). The portion of
      this
      Debenture subject to redemption pursuant to this Section 6(c) shall be redeemed
      by the Company in cash at a price equal to the sum of (i) the principal amount
      being redeemed, (ii) any accrued and unpaid interest thereon and (iii) all
      other
      amounts, costs, expenses and liquidated damages due in respect of this Debenture
      as of the Holder Optional Redemption Date (the "Holder
      Optional Redemption Price").
      Redemptions required by this Section 6 shall be made in accordance with the
      provisions of Section 6(d).

     

    
      
        
        

      

      
        -30-

        
          

        

      

      
        
        

      

    

     

    (d) Mechanics
      of Redemptions.
      The
      Company shall deliver the applicable Mandatory Redemption Amount to the Holder
      within five Trading Days after the Company's receipt of the Holder's Event
      of
      Default Redemption Notice. If the Holder has submitted a Change of Control
      Redemption Notice in accordance with Section 6(b), the Company shall deliver
      the
      applicable Change of Control Redemption Price to the Holder concurrently with
      the consummation of such Change of Control if such notice is received prior
      to
      the consummation of such Change of Control and within five Business Days after
      the Company's receipt of such notice otherwise. If the Holder has submitted
      a
      Holder Optional Redemption Notice in accordance with Section 6(c), the Company
      shall deliver the applicable Holder Optional Redemption Price to the Holder
      within ten Business Days (the "Holder
      Optional Redemption Date")
      after
      the Company's receipt of such notice. In the event that the Company does not
      pay
      a redemption price or redemption amount to the Holder within the time period
      required, at any time thereafter and until the Company pays such unpaid
      redemption price or redemption amount in full, the Holder shall have the option,
      in lieu of redemption, to require the Company to promptly return to the Holder
      all or any portion of this Debenture representing the outstanding principal
      amount that was submitted for redemption and for which the applicable redemption
      price or redemption amount (together with any interest thereon) has not been
      paid. Upon the Company's receipt of such notice, (x) the applicable redemption
      notice shall be null and void with respect to such outstanding principal amount,
      and (y) if the Holder surrendered this Debenture to the Company in connection
      with any such redemption, the Company shall immediately return this Debenture,
      or issue a new Debenture (in accordance with Section 4) to the Holder
      representing such outstanding principal amount.

     

    (e) Redemption
      by Other Holders.
      Upon
      the Company's receipt of notice from any of the holders of the other Debentures
      for redemption or repayment as a result of an event or occurrence substantially
      similar to the events or occurrences described in Sections 6(a), 6(b) or 6(c)
      (each, an "Other
      Redemption Notice"),
      the
      Company shall immediately, but no later than one (1) Business Day of its receipt
      thereof, forward to the Holder by facsimile a copy of such notice. If the
      Company receives a Redemption Notice and one or more Other Redemption Notices,
      during the seven (7) Business Day period beginning on and including the date
      which is three (3) Business Days prior to the Company's receipt of a redemption
      notice from the Holder (the "Holder's
      Redemption Notice")
      and
      ending on and including the date which is three (3) Business Days after the
      Company's receipt of the Holder's Redemption Notice and the Company is unable
      to
      redeem all principal, interest and other amounts designated in the Holder's
      Redemption Notice and such Other Redemption Notices received during such seven
      (7) Business Day period, then the Company shall redeem a pro rata amount from
      each holder of the Debentures (including the Holder) based on the principal
      amount of the Debentures submitted for redemption pursuant to such Holder's
      Redemption Notice and such Other Redemption Notices received by the Company
      during such seven Business Day period.

     

    
      
        
        

      

      
        -31-

        
          

        

      

      
        
        

      

    

     

    7. Covenants.

     

    (a) Ranking.
      This
      Debenture ranks pari
      passu
      with all
      other Debentures now or hereafter issued pursuant to the Transaction Documents.
      No Indebtedness of the Company is senior to this Debenture in right of payment,
      whether with respect of interest, damages or upon liquidation or dissolution
      or
      otherwise. The Company will not, and will not permit any Subsidiary to, directly
      or indirectly, enter into, create, incur, assume or suffer to exist Indebtedness
      of any kind, on or with respect to any of its property or assets now owned
      or
      hereafter acquired or any interest therein or any income or profits therefrom,
      that is senior in any respect to the Company’s obligations under the Debentures
      or that is pari
      passu
      with the
      Company's obligations under the Debentures other than the Permitted Pari Passu
      Indebtedness. 

     

    (b) Incurrence
      of Indebtedness.
      So long
      as this Debenture is outstanding, the Company shall not, and the Company shall
      not permit any of its Subsidiaries to, directly or indirectly, incur or
      guarantee, assume or suffer to exist any Indebtedness, other than (i) the
      Indebtedness evidenced by this Debenture and the other Debentures and (ii)
      other
      Permitted Indebtedness.

     

    (c) Existence
      of Liens.
      So long
      as this Debenture is outstanding, the Company shall not, and the Company shall
      not permit any of its Subsidiaries to, directly or indirectly, allow or suffer
      to exist any mortgage, lien, pledge, charge, security interest or other
      encumbrance upon or in any property or assets (including accounts and contract
      rights) owned by the Company or any of its Subsidiaries (collectively,
      "Liens")
      other
      than Permitted Liens. 

     

    (d) Restricted
      Payments.
      The
      Company shall not, and the Company shall not permit any of its Subsidiaries
      to,
      directly or indirectly, redeem, defease, repurchase, repay or make any payments
      in respect of, by the payment of cash or cash equivalents (in whole or in part,
      whether by way of open market purchases, tender offers, private transactions
      or
      otherwise), all or any portion of any Permitted Indebtedness (other than this
      Debenture and the other Debentures), whether by way of payment in respect of
      principal of (or premium, if any) or interest on such Indebtedness, if at the
      time such payment is due or is otherwise made or, after giving effect to such
      payment, an event constituting, or that with the passage of time and without
      being cured would constitute, an Event of Default has occurred and is
      continuing.

     

    (e) Restriction
      on Redemption and Cash Dividends.
      Until
      all of the Debentures have been converted, redeemed or otherwise satisfied
      in
      accordance with their terms, the Company shall not, directly or indirectly,
      redeem, repurchase or declare or pay any cash dividend or distribution on its
      capital stock without the prior express written consent of the Majority Holders;
      provided,
      however,
      that
      this Section 7(e) shall not prohibit or restrict the Company’s exercise of its
      rights and/or discharge or satisfaction of its obligations under its Series
      A2
      Convertible Preferred Stock, Series B Convertible Preferred Stock, Series C2
      Preferred Stock and/or the Company’s existing Convertible Debentures Due 2007,
      in each case in accordance with the terms thereof as of the date hereof.

     

    (f) Cash
      and Unsecured Indebtedness Ratio Test; Announcement of Operating
      Results.
      So long
      as this Debenture is outstanding, the Company shall maintain a Cash to Unsecured
      Indebtedness Ratio of at least 0.8 to 1.0 (the "Cash
      and Unsecured Indebtedness Ratio Test").
      Commencing with the Fiscal Quarter ending December 31, 2006, the Company shall
      publicly disclose
      and
      disseminate its operating results (the "Operating
      Results")
      (x)
      for each of the first three Fiscal Quarters of each fiscal year no later than
      the forty-fifth (45th)
      day
      after the end of such Fiscal Quarter and (y) for the fourth Fiscal Quarter
      of each fiscal year, no later than the ninetieth (90th)
      day
      after the end of such Fiscal Quarter. Such Operating Results shall include
      the
      amount of the Cash and Unsecured Indebtedness Ratio for the preceding Fiscal
      Quarter and state whether the Company has satisfied the Cash to Unsecured
      Indebtedness Ratio Test. Concurrently with each such release of Operating
      Results, the Company also shall provide to the holders of Debentures a written
      certification as to the amount of Cash and Unsecured Indebtedness for the
      applicable Fiscal Quarter. In addition, if the Company has failed to meet the
      Cash and Unsecured Indebtedness Ratio Test, the foregoing written certification
      that the Company provides to the holders shall also state that such test has
      not
      been met. 

     

    
      
        
        

      

      
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    8. Disclosure.
      Upon
      receipt or delivery by the Company of any notice in accordance with the terms
      of
      this Debenture, unless the Company has in good faith determined that the matters
      relating to such notice do not constitute material, nonpublic information
      relating to the Company or its Subsidiaries, the Company shall within one (1)
      Business Day after any such receipt or delivery publicly disclose such material,
      nonpublic information on a Current Report on Form 8-K or otherwise. In the
      event
      that the Company believes that a notice contains material, nonpublic
      information, relating to the Company or its Subsidiaries, the Company shall
      indicate to the Holder contemporaneously with delivery of such notice, and
      in
      the absence of any such indication, the Holder shall be allowed to presume
      that
      all matters relating to such notice do not constitute material, nonpublic
      information relating to the Company or its Subsidiaries.

     

    9. Miscellaneous.

     

    (a) This
      Debenture shall be binding on and inure to the benefit of the parties hereto
      and
      their respective successors and assigns. This Debenture may be amended only
      in
      writing signed by the Company and the Majority Holders and their respective
      successors and assigns.

     

    (b) Nothing
      in this Debenture shall be construed to give to any Person other than the
      Company and the Holder any legal or equitable right, remedy or cause under
      this
      Debenture. This Debenture shall inure to the sole and exclusive benefit of
      the
      Company and the Holder.

     

    (c) The
      remedies provided in this Debenture shall be cumulative and in addition to
      all
      other remedies available under this Debenture and any of the other Transaction
      Documents at law or in equity (including a decree of specific performance and/or
      other injunctive relief), and nothing herein shall limit the right of the Holder
      to pursue actual damages for any failure by the Company to comply with the
      terms
      of this Debenture. The Company acknowledges that a breach by it of its
      obligations hereunder will cause irreparable harm to the Holder and that the
      remedy at law for any such breach may be inadequate. The Company therefore
      agrees that, in the event of any such breach or threatened breach, the Holder
      shall be entitled, in addition to all other available remedies, to an injunction
      restraining any breach, without the necessity of showing economic loss and
      without any bond or other security being required.

     

    
      
        
        

      

      
        -33-

        
          

        

      

      
        
        

      

    

     

    (d) If
      (i)
      this Debenture is placed in the hands of an attorney for collection or
      enforcement or is collected or enforced through any legal proceeding or the
      Holder otherwise takes action to collect amounts due under this Debenture or
      to
      enforce the provisions of this Debenture or (ii) there occurs any bankruptcy,
      reorganization, receivership of the Company or other proceedings affecting
      Company creditors' rights and involving a claim under this Debenture, then
      the
      Company shall pay the costs incurred by the Holder for such collection,
      enforcement or action or in connection with such bankruptcy, reorganization,
      receivership or other proceeding, including, but not limited to, financial
      advisory fees and attorneys' fees and disbursements.

     

    (e) In
      the
      case of a dispute as to the arithmetic calculation of any conversion price
      or
      conversion rate or any redemption price, the Company shall submit the disputed
      determinations or arithmetic calculations via facsimile within two Business
      Days
      of receipt, or deemed receipt, of the Conversion Notice or redemption notice
      or
      other event giving rise to such dispute, as the case may be, to the Holder.
      If
      the Holder and the Company are unable to agree upon such determination or
      calculation within two Business Days of such disputed arithmetic calculation
      being submitted to the Holder, then the Company shall, within one Business
      Day
      of such two Business Day period submit via facsimile the disputed arithmetic
      calculation of such conversion price or conversion rate or any redemption price
      to the Company's independent, outside accountant. The Company shall cause the
      accountant to perform the calculations and notify the Company and the Holder
      of
      the results no later than two Business Days from the time it receives the
      disputed calculations. Such accountant's calculation, shall be binding upon
      all
      parties absent demonstrable error. The reasonable expenses of such accountant
      in
      making such determination shall be paid by the Company in the event the Holder's
      calculation was correct, or by the Holder in the event the Company's calculation
      was correct, or equally by the Company and the Holder in the event that neither
      the Company's or the Holder's calculation was correct.

     

    (f) All
      questions concerning the construction, validity, enforcement and interpretation
      of this Debenture shall be governed by and construed and enforced in accordance
      with the internal laws of the State of New York, without regard to the
      principles of conflicts of law thereof. Each party agrees that all Proceedings
      shall be commenced exclusively in the state and federal courts sitting in the
      City of New York, Borough of Manhattan (the “New
      York Courts”).
      Each
      party hereto hereby irrevocably submits to the exclusive jurisdiction of the
      New
      York Courts for any proceeding, and hereby irrevocably waives, and agrees not
      to
      assert in any Proceeding, any claim that it is not personally subject to the
      jurisdiction of any New York Court or that a New York Court is an inconvenient
      forum for such Proceeding. Each party hereto hereby irrevocably waives personal
      service of process and consents to process being served in any such Proceeding
      by mailing a copy thereof via registered or certified mail or overnight delivery
      (with evidence of delivery) to such party at the address in effect for notices
      to it under this Debenture and agrees that such service shall constitute good
      and sufficient service of process and notice thereof. Nothing contained herein
      shall be deemed to limit in any way any right to serve process in any manner
      permitted by law. Each party hereto hereby irrevocably waives, to the fullest
      extent permitted by applicable law, any and all right to trial by jury in any
      legal Proceeding. If either party shall commence a Proceeding, then the
      prevailing party in such Proceeding shall be reimbursed by the other party
      for
      its attorney’s fees and other costs and expenses incurred with the
      investigation, preparation and prosecution of such Proceeding.

     

    
      
        
        

      

      
        -34-

        
          

        

      

      
        
        

      

    

     

    (g) The
      headings herein are for convenience only, do not constitute a part of this
      Debenture and shall not be deemed to limit or affect any of the provisions
      hereof.

     

    (h) In
      case
      any one or more of the provisions of this Debenture shall be invalid or
      unenforceable in any respect, the validity and enforceability of the remaining
      terms and provisions of this Debenture shall not in any way be affected or
      impaired thereby and the parties will attempt in good faith to agree upon a
      valid and enforceable provision which shall be a commercially reasonable
      substitute therefor, and upon so agreeing, shall incorporate such substitute
      provision in this Debenture.

     

    (i) No
      provision of this Debenture may be waived or amended except in a written
      instrument signed by the Company and the Majority Holders. No waiver of any
      default with respect to any provision, condition or requirement of this
      Debenture shall be deemed to be a continuing waiver in the future or a waiver
      of
      any subsequent default or a waiver of any other provision, condition or
      requirement hereof, nor shall any delay or omission of either party to exercise
      any right hereunder in any manner impair the exercise of any such
      right.

     

    (j) If
      it
      shall be found that any interest due hereunder shall violate applicable laws
      governing usury, the applicable rate of interest due hereunder shall be reduced
      to the maximum permitted rate of interest under such law.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGE FOLLOWS]

     

    
      
        
        

      

      
        -35-

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the Company has caused this Convertible Debenture to be duly
      executed by a duly authorized officer as of the date first above
      indicated.

    
      	 	 	 
	 	MILLENNIUM
              CELL
              INC.
	 
 	 
 	 
 
	
            	By:  	/s/
              John
              D. Giolli 
	 	
              

              Name:
                John D. Giolli

              Title:
                Chief Financial Officer

            

    

     

    
      
        
        

      

      
        -36-

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

     

    Convertible
      Debentures 

     

    HOLDER
      CONVERSION NOTICE

    

    (To
      be
      Executed by the Registered Holder

    in
      order
      to convert Debentures)

     

    The
      undersigned hereby elects to convert the principal amount of Debenture indicated
      below, into shares of Common Stock of Millennium Cell Inc., as of the date
      written below. If shares are to be issued in the name of a Person other than
      undersigned, the undersigned will pay all transfer taxes payable with respect
      thereto and is delivering herewith such certificates and opinions as reasonably
      requested by the Company in accordance therewith. No fee will be charged to
      the
      Holder for any conversion, except for such transfer taxes, if any. All terms
      used in this notice shall have the meanings set forth in the
      Debenture.

     

    
      	Conversion calculations:	 	 	 
	 	 	                  
              	 
	 	 	Date to Effect Conversion	 
	 	 	               
              	 
	 	 	
              Principal
                amount of Debenture owned prior to conversion

            	 
	 	 	          
              	 
	 	 	
              Principal
                amount of Debenture to be Converted

              (including
                _______________ of interest added under Section 5(a) of
                the Debenture)

            	 
	 	 	             
              	 
	 	 	
              Principal
                amount of Debenture remaining after Conversion

            	 
	 	 	           
              	 
	 	 	
              Number
                of shares of Common Stock to be Issued

            	 
	 	 	              
              	 
	 	 	
              Applicable
                Conversion Price

            	 
	 	 	 	 
	
              Account
                Number:

            	 	            
              	 
	
              (if
                electronic book entry transfer)

            	 
	 	 	 	 
	
              Transaction
                Code Number:

            	 	                   
              	 
	
              (if
                electronic book entry transfer)

            	 

    

     

    
      	 	 	 
	 	
              
Name
              of Holder 
	 	 	 
	
            	By:  	
            
	 	Name:  	
              
 
	 	Title:	 

    

    
       

    

    
      	 	
              [
                ]

            	
              By
                the delivery of this Conversion Notice the Holder represents and
                warrants
                to the Company that its ownership of the Common Stock does not exceed
                the
                restrictions set forth in Section 5(d)(i) of the
                Debenture.

            

    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    ACKNOWLEDGMENT

     

    The
      Company hereby acknowledges this Holder Conversion Notice and hereby directs
      American Stock Transfer & Trust Company to issue the above indicated number
      of shares of Common Stock in accordance with the Irrevocable Transfer Agent
      Instructions dated January __, 2007 from the Company and acknowledged and agreed
      to by American Stock Transfer & Trust Company.

    
      	 	 	 
	 	MILLENNIUM
              CELL
              INC.
	 
 	 
 	 
 
	
            	By:  	
            
	 	Name:  	
              
 
	 	Title:	
              
 
	 	
              

            
	 	
            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

     

    Convertible
      Debentures

     

    COMPANY
      CONVERSION NOTICE

    

    (To
      be
      executed by the Company

    in
      order
      to convert the Debenture)

    

    The
      undersigned in the name and on behalf of Millennium Cell Inc., hereby elects
      to
      convert the principal amount of Debenture indicated below, into shares of Common
      Stock of Millennium Cell Inc., as of the date written below. If shares are
      to be
      issued in the name of a Person other than the Holder, the Holder will pay all
      transfer taxes payable with respect thereto and is delivering herewith such
      certificates and opinions as reasonably requested by the Company in accordance
      therewith. No fee will be charged to the Holder for any conversion, except
      for
      such transfer taxes, if any. All terms used in this notice shall have the
      meanings set forth in the Debenture.

    
       

      
        	Conversion calculations:	 	 	 
	 	 	                  
                	 
	 	 	Date to Effect Conversion	 
	 	 	               
                	 
	 	 	
                Principal
                  amount of Debenture owned prior to conversion

              	 
	 	 	          
                	 
	 	 	
                
                  Principal
                    amount of Debenture to be Converted

                  (including
                    _______________ of interest added under Section 5(a) of
                    the Debenture)

                

              	 
	 	 	             
                	 
	 	 	
                Principal
                  amount of Debenture remaining after Conversion

              	 
	 	 	           
                	 
	 	 	
                Number
                  of shares of Common Stock to be Issued

              	 
	 	 	              
                	 
	 	 	
                Applicable
                  Conversion Price

              	 
	 	 	 	 
	
                Account
                  Number:

              	 	            
                	 
	
                (if
                  electronic book entry transfer)

              	 
	 	 	 	 
	
                Transaction
                  Code Number:

              	 	                   
                	 
	
                (if
                  electronic book entry transfer)

              	 

      

       

      
        	 	 	 
	 	
                
Name
                of Holder 
	 	 	 
	
              	By:  	
              
	 	Name:  	
                
 
	 	Title:	 

      

       

      
        	 	 	 
	 	MILLENNIUM
                CELL INC.
	 
 	 
 	 
 
	
              	By:  	
              
	 	Name:  	
                
 
	 	Title:	 
	 	 

      

    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    Schedule
      1

     

    CONVERSION
      SCHEDULE

     

    Convertible
      Debentures in the aggregate principal amount of $6,000,000 issued by Millennium
      Cell Inc. This Conversion Schedule reflects conversions made under the above
      referenced
      Debentures.

     

    Dated:

    

    
      	
              Date
                of Conversion

            	 	
              Amount
                of Conversion

            	 	
              Aggregate
                Principal Amount Remaining Subsequent to Conversion

            	 	
              Applicable
                Conversion Price 

            
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
               

            	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

    

    

    
      
        
        

      

      
        -3-Exhibit
        4.2

    

     

    [FORM
      OF WARRANT]

     

    NEITHER
      THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
      THE
      SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
      LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
      (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
      UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL,
      IN A
      FORM AND FROM COUNSEL REASONABLY ACCEPTABLE TO THE ISSUER AND ITS COUNSEL,
      THAT
      REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO
      RULE
      144 UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED
      IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING
      ARRANGEMENT SECURED BY THE SECURITIES.

    

    MILLENNIUM
      CELL INC.

    

      WARRANT
        TO
        PURCHASE
        COMMON
        STOCK

    

    

    Warrant
      No.:    

    Number
      of
      Shares of Common Stock:_____________

    Date
      of
      Issuance: February 16, 2007 ("Issuance
      Date")

    

    Millennium
      Cell Inc., a Delaware corporation (the "Company"),
      hereby certifies that, for good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, PORTSIDE GROWTH AND OPPORTUNITY
      FUND [OTHER BUYERS], the registered holder hereof or its permitted assigns
      (the
      "Holder"),
      is
      entitled, subject to the terms set forth below, to purchase from the Company,
      at
      the Exercise Price (as defined below) then in effect, upon surrender of this
      Warrant to Purchase Common Stock (including any Warrants to Purchase Common
      Stock issued in exchange, transfer or replacement hereof, the "Warrant"),
      at
      any time or times on or after the date hereof, but not after 11:59 p.m., New
      York time, on the Expiration Date (as defined below), ______________
      (_____________)1 
      fully
      paid nonassessable shares of Common Stock (as defined below) (the
      "Warrant
      Shares").
      Except as otherwise defined herein, capitalized terms in this Warrant shall
      have
      the meanings set forth in Section 15. This Warrant is one of the Warrants to
      Purchase Common Stock (the "SPA
      Warrants")
      issued
      pursuant to Section 1 of that certain Securities Purchase Agreement, dated
      as of
      February 15, 2007 (the "Subscription
      Date"),
      by
      and among the Company and the investors (the "Buyers")
      referred to therein (the "Securities
      Purchase Agreement").

    
      
        
           

          
            

          

        

        1 Insert
          a
          number of shares equal to 35% of the quotient obtained by dividing the
          principal
          amount of Debentures issued on the Issuance Date to the Holder by the Exercise
          Price.

         

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.  EXERCISE
      OF WARRANT.

     

    (a)  Mechanics
      of Exercise.
      Subject
      to the terms and conditions hereof (including, without limitation, the
      limitations set forth in Section 1(e)), this Warrant may be exercised by the
      Holder on any day on or after the date hereof, but not after 11:59 p.m. New
      York
      time, on the Expiration Date, in whole or in part, by (i) delivery of a
      written notice, in the form attached hereto as Exhibit
      A
      (the
      "Exercise
      Notice"),
      of
      the Holder's election to exercise this Warrant and (ii) (A) payment to the
      Company of an amount equal to the applicable Exercise Price multiplied by the
      number of Warrant Shares as to which this Warrant is being exercised (the
      "Aggregate
      Exercise Price")
      in
      cash or by wire transfer of immediately available funds to an account designated
      by the Company or (B) by notifying the Company that this Warrant is being
      exercised pursuant to a Cashless Exercise (as defined in Section 1(d)). The
      Holder shall not be required to deliver the original Warrant in order to effect
      an exercise hereunder. Execution and delivery of the Exercise Notice with
      respect to less than all of the Warrant Shares shall have the same effect as
      cancellation of the original Warrant and issuance of a new Warrant evidencing
      the right to purchase the remaining number of Warrant Shares. Execution and
      delivery of the Exercise Notice with respect to all of the Warrant Shares shall
      have the same effect as cancellation of the original Warrant upon such Holder's
      receipt of all of such Warrant Shares. On or before the first Business Day
      following the date on which the Company has received each of the Exercise Notice
      and the Aggregate Exercise Price (or notice of a Cashless Exercise) (the
      "Exercise
      Delivery Documents"),
      the
      Company shall transmit by facsimile an acknowledgment of confirmation of receipt
      of the Exercise Delivery Documents to the Holder and the Company's transfer
      agent (the "Transfer
      Agent").
      On or
      before the third Business Day following the date on which the Company has
      received all of the Exercise Delivery Documents (the "Share
      Delivery Date"),
      the
      Company shall (X) provided that the Transfer Agent is participating in The
      Depository Trust Company ("DTC")
      Fast
      Automated Securities Transfer Program, upon the request of the Holder, credit
      such aggregate number of Warrant Shares to which the Holder is entitled pursuant
      to such exercise to the Holder's or its designee's balance account with DTC
      through its Deposit Withdrawal Agent Commission System, or (Y) if the Transfer
      Agent is not participating in the DTC Fast Automated Securities Transfer
      Program, issue and dispatch by overnight courier to the address as specified
      in
      the Exercise Notice, a certificate dated the date of such exercise and
      registered in the Company's share register in the name of the Holder or its
      designee, for the number of Warrant Shares to which the Holder is entitled
      pursuant to such exercise. Upon delivery of the Exercise Delivery Documents,
      the
      Holder shall be deemed, to the extent permitted by applicable law, for all
      corporate purposes to have become the holder of record of the Warrant Shares
      with respect to which this Warrant has been exercised, irrespective of the
      date
      such Warrant Shares are credited to the Holder's DTC balance account or the
      date
      of delivery of the certificates evidencing such Warrant Shares, as the case
      may
      be. If this Warrant is submitted in connection with any exercise pursuant to
      this Section 1(a) and the number of Warrant Shares represented by this Warrant
      submitted for exercise is greater than the number of Warrant Shares being
      acquired upon an exercise, then the Company shall as soon as practicable and
      in
      no event later than three (3) Business Days after any exercise and at its own
      expense, issue a new Warrant (issued in accordance with Section 7(d))
      representing the right to purchase the number of Warrant Shares purchasable
      immediately prior to such exercise under this Warrant, less the number of
      Warrant Shares with respect to which this Warrant is exercised. No fractional
      shares of Common Stock are to be issued upon the exercise of this Warrant,
      but
      rather the number of shares of Common Stock to be issued shall be rounded up
      to
      the nearest whole number. The Company shall pay any and all taxes which may
      be
      payable with respect to the issuance and delivery of Warrant Shares upon
      exercise of this Warrant; provided,
      however,
      that in
      the event certificates for the Warrant Shares are to be issued in a name other
      than the name of the Holder, the Company may require, as a condition thereto,
      the payment of a sum sufficient to reimburse it for any transfer tax incidental
      thereto.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    (b)  Exercise
      Price.
      For
      purposes of this Warrant, "Exercise
      Price"
      means
      $1.14, subject to adjustment as provided herein.

     

    (c)  Company's
      Failure to Timely Deliver Securities.
      Subject
      to Section 1(f), if within three (3) Business Days after the Company's receipt
      of the Exercise Delivery Documents, the Company shall fail to issue and deliver
      a certificate to the Holder for the number of Warrant Shares to which such
      Holder is entitled or to credit the Holder's balance account with DTC for the
      number of Warrant Shares to which the Holder is entitled upon such holder's
      exercise hereunder, and if on or after such third Business Day but prior to
      the
      Company's cure of such failure, the Holder purchases (in an open market
      transaction or otherwise) shares of Common Stock to deliver in satisfaction
      of a
      sale by the Holder of shares of Common Stock issuable upon such exercise that
      the Holder anticipated receiving from the Company (a "Buy-In"),
      then
      the Company shall, within three (3) Business Days after the Holder's request
      and
      in the Holder's discretion, either (i) pay cash to the Holder in an amount
      equal
      to the Holder's total purchase price (including reasonable brokerage
      commissions, if any) for the shares of Common Stock so purchased (the
"Buy-In
      Price"),
      at
      which point the Company's obligation to deliver such certificate (and to issue
      such Warrant Shares) shall terminate, or (ii) promptly honor its obligation
      to
      deliver to the Holder a certificate or certificates representing such Warrant
      Shares and pay cash to the Holder in an amount equal to the excess (if any)
      of
      the Buy-In Price over the product of (A) such number of Warrant Shares, times
      (B) the Closing Bid Price on the date of exercise.

     

    (d)  Cashless
      Exercise.
       Notwithstanding
      anything contained herein to the contrary, if a Registration Statement (as
      defined in the Registration Rights Agreement) covering the Warrant Shares that
      are the subject of an Exercise Notice (the "Unavailable
      Warrant Shares")
      is not
      available for the resale of such Unavailable Warrant Shares, the Holder may,
      in
      its sole discretion, exercise this Warrant in whole or in part and, in lieu
      of
      making the cash payment otherwise contemplated to be made to the Company upon
      such exercise in payment of the Aggregate Exercise Price, elect instead to
      receive upon such exercise the "Net Number" of shares of Common Stock determined
      according to the following formula (a "Cashless
      Exercise"):

     

    Net
      Number =  (A
      x
      B) - (A x C)

    B

     

    For
      purposes of the foregoing formula:

     

    A=
      the
      total number of shares with respect to which this Warrant is then being
      exercised.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    B=
      the
      Closing Sale Price of the shares of Common Stock (as reported by Bloomberg)
      on
      the date immediately preceding the date of the Exercise Notice.

     

    C=
      the
      Exercise Price then in effect for the applicable Warrant Shares at the time
      of
      such exercise.

    

    (e)  Disputes.
      In the
      case of a dispute as to the determination of the Exercise Price or the
      arithmetic calculation of the Warrant Shares, the Company shall promptly issue
      to the Holder the number of Warrant Shares that are not disputed and resolve
      such dispute in accordance with Section 12.

     

    (f)  Limitations
      on Exercises.

     

    (i)
      Beneficial
      Ownership.
      The
      Company shall not effect the exercise of this Warrant, and the Holder shall
      not
      have the right to exercise this Warrant, to the extent that after giving effect
      to such exercise, the Holder (together with the Holder's affiliates) would
      beneficially own in excess of 4.99% of the number of shares of Common Stock
      outstanding immediately after giving effect to such exercise. For purposes
      of
      the foregoing sentence, the aggregate number of shares of Common Stock
      beneficially owned by such Person and its affiliates shall include the number
      of
      shares of Common Stock issuable upon exercise of this Warrant with respect
      to
      which the determination of such sentence is being made, but shall exclude shares
      of Common Stock which would be issuable upon (i) exercise of the remaining,
      unexercised portion of this Warrant beneficially owned by such Person and its
      affiliates and (ii) exercise or conversion of the unexercised or unconverted
      portion of any other securities of the Company beneficially owned by such Person
      and its affiliates (including, without limitation, any convertible notes or
      convertible preferred stock or warrants) subject to a limitation on conversion
      or exercise analogous to the limitation contained herein. Except as set forth
      in
      the preceding sentence, for purposes of this paragraph, beneficial ownership
      shall be calculated in accordance with Section 13(d) of the Securities Exchange
      Act of 1934, as amended. For purposes of this Warrant, in determining the number
      of outstanding shares of Common Stock, the Holder may rely on the number of
      outstanding shares of Common Stock as reflected in (1) the Company's most recent
      Form 10-K, Form 10-Q, Current Report on Form 8-K or other public filing with
      the
      Securities and Exchange Commission, as the case may be, (2) a more recent public
      announcement by the Company or (3) any other notice by the Company or the
      Transfer Agent setting forth the number of shares of Common Stock outstanding.
      For any reason at any time, upon the written or oral request of the Holder,
      the
      Company shall within two Business Days confirm orally and in writing to the
      Holder the number of shares of Common Stock then outstanding. In any case,
      the
      number of outstanding shares of Common Stock shall be determined after giving
      effect to the conversion or exercise of securities of the Company, including
      the
      SPA Securities and the SPA Warrants, by the Holder and its affiliates since
      the
      date as of which such number of outstanding shares of Common Stock was reported.
      By written notice to the Company, the Holder may increase or decrease the
      Maximum Percentage to any other percentage not in excess of 9.99% specified
      in
      such notice; provided that (i) any such increase will not be effective until
      the
      sixty-first (61st)
      day
      after such notice is delivered to the Company, and (ii) any such increase or
      decrease will apply only to the Holder and not to any other holder of SPA
      Warrants.

     

    
      
        
        

      

      
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    (ii)
      Principal
      Market Regulation.
      The
      Company shall not be obligated to issue any Warrant Shares upon exercise of
      this
      Warrant if the issuance of such Warrant Shares would exceed that number of
      shares of Common Stock which the Company may issue upon exercise of this Warrant
      (including, as applicable, any shares of Common Stock issued upon conversion
      or
      as interest on the SPA Securities) without breaching the Company's obligations
      under the rules or regulations of the Principal Market (the "Exchange
      Cap"),
      except that such limitation shall not apply in the event that the Company (A)
      obtains the approval of its stockholders as required by the applicable rules
      of
      the Principal Market for issuances of shares of Common Stock in excess of such
      amount or (B) obtains a written opinion from outside counsel to the Company
      that
      such approval is not required, which opinion shall be reasonably satisfactory
      to
      the Required Holders. Until such approval or written opinion is obtained, no
      Buyer shall be issued, upon exercise or conversion, as applicable, of any SPA
      Warrants or SPA Securities, shares of Common Stock in an amount greater than
      the
      product of the Exchange Cap multiplied by a fraction, the numerator of which
      is
      the total number of shares of Common Stock underlying this Warrant issued to
      such Buyer pursuant to the Securities Purchase Agreement on the Issuance Date
      and the denominator of which is the aggregate number of shares of Common Stock
      underlying this Warrant issued to the Buyers pursuant to the Securities Purchase
      Agreement on the Issuance Date (with respect to each Buyer, the "Exchange
      Cap Allocation").
      In
      the event that any Buyer shall sell or otherwise transfer any of such Buyer's
      SPA Warrants, the transferee shall agree in writing to be bound by the Exchange
      Cap and shall be allocated a pro rata portion of such Buyer's Exchange Cap
      Allocation, and the restrictions of the prior sentence shall apply to such
      transferee with respect to the portion of the Exchange Cap Allocation allocated
      to such transferee. In the event that any holder of SPA Warrants shall exercise
      all of such holder's SPA Warrants into a number of shares of Common Stock which,
      in the aggregate, is less than such holder's Exchange Cap Allocation, then
      the
      difference between such holder's Exchange Cap Allocation and the number of
      shares of Common Stock actually issued to such holder shall be allocated to
      the
      respective Exchange Cap Allocations of the remaining holders of SPA Warrants
      on
      a pro rata basis in proportion to the shares of Common Stock underlying the
      SPA
      Warrants then held by each such holder. In the event that the Company is
      prohibited from issuing any Warrant Shares for which an Exercise Notice has
      been
      received as a result of the operation of this Section 1(f)(ii), the Company
      shall pay cash in exchange for cancellation of such Warrant Shares, at a price
      per Warrant Share equal to the difference between the Closing Sale Price and
      the
      Exercise Price as of the date of the attempted exercise.

     

    
      
        
        

      

      
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    (g)  Insufficient
      Authorized Shares.
      If at
      any time while any of the Warrants remain outstanding the Company does not
      have
      a sufficient number of authorized and unreserved shares of Common Stock to
      satisfy its obligation to reserve for issuance upon exercise of the Warrants
      at
      least a number of shares of Common Stock equal to 100% (the "Required
      Reserve Amount")
      of the
      number of shares of Common Stock as shall from time to time be necessary to
      effect the exercise of all of the Warrants then outstanding (an "Authorized
      Share Failure"),
      then
      the Company shall immediately take all action necessary to increase the
      Company's authorized shares of Common Stock to an amount sufficient to allow
      the
      Company to reserve the Required Reserve Amount for the Warrants then
      outstanding. Without limiting the generality of the foregoing sentence, as
      soon
      as practicable after the date of the occurrence of an Authorized Share Failure,
      but in no event later than sixty (60) days after the occurrence of such
      Authorized Share Failure, the Company shall hold a meeting of its stockholders
      for the approval of an increase in the number of authorized shares of Common
      Stock. In connection with such meeting, the Company shall provide each
      stockholder with a proxy statement and shall use its best efforts to solicit
      its
      stockholders' approval of such increase in authorized shares of Common Stock
      and
      to cause its board of directors to recommend to the stockholders that they
      approve such proposal.

     

    2.  ADJUSTMENT
      OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES.
      The
      Exercise Price shall be adjusted from time to time as follows:

     

    (a)  Adjustment
      upon Issuance of shares of Common Stock.
      If and
      whenever on or after the Subscription Date the Company issues or sells, or
      in
      accordance with this Section 2 is deemed to have issued or sold, any shares
      of
      Common Stock (including the issuance or sale of shares of Common Stock owned
      or
      held by or for the account of the Company, but excluding shares of Common Stock
      deemed to have been issued by the Company in connection with any Excluded
      Securities (as defined in the SPA Securities)) for a consideration per share
      less than a price (the "Applicable
      Price")
      equal
      to the Exercise Price in effect immediately prior to such issue or sale or
      deemed issuance or sale (the foregoing a "Dilutive
      Issuance"),
      then
      immediately after such Dilutive Issuance, the Exercise Price then in effect
      shall be reduced to an amount equal to the
      product of (A) the Exercise Price in effect immediately prior to such
      Dilutive Issuance and (B) the quotient determined by dividing (1) the
      sum of (I) the product derived by multiplying the Exercise Price in effect
      immediately prior to such Dilutive Issuance and the number of shares of Common
      Stock Deemed Outstanding immediately prior to such Dilutive Issuance plus
      (II) the consideration, if any, received by the Company upon such Dilutive
      Issuance, by (2) the product derived by multiplying (I) the Exercise Price
      in effect immediately prior to such Dilutive Issuance by (II) the number of
      shares of Common Stock Deemed Outstanding immediately after such Dilutive
      Issuance.
      For
      purposes of determining the adjusted Exercise Price under this Section 2(a),
      the
      following shall be applicable:

     

    
      
        
        

      

      
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      (i)
        Issuance of Options. If the Company in any manner grants any Options and
        the lowest price per share for which one share of Common Stock is issuable
        upon
        the exercise of any such Option or upon conversion, exercise or exchange
        of any
        Convertible Securities issuable upon exercise of any such Option is less
        than
        the Applicable Price, then such share of Common Stock shall be deemed to
        be
        outstanding and to have been issued and sold by the Company at the time of
        the
        granting or sale of such Option for such price per share. For purposes of
        this
        Section 2(a)(i), the "lowest price per share for which one share of Common
        Stock
        is issuable upon exercise of such Options or upon conversion, exercise or
        exchange of such Convertible Securities" shall be equal to the sum of the
        lowest
        amounts of consideration (if any) received or receivable by the Company with
        respect to any one share of Common Stock upon the granting or sale of the
        Option, upon exercise of the Option and upon conversion, exercise or exchange
        of
        any Convertible Security issuable upon exercise of such Option. Except as
        provided in Section 2(a)(ii), no further adjustment of the Exercise Price
        shall
        be made upon the actual issuance of such shares of Common Stock or of such
        Convertible Securities upon the exercise of such Options or upon the actual
        issuance of such shares of Common Stock upon conversion, exercise or exchange
        of
        such Convertible Securities. 

    

     

    (ii)
      Issuance
      of Convertible Securities.
      If the
      Company in any manner issues or sells any Convertible Securities and the lowest
      price per share for which one share of Common Stock is issuable upon the
      conversion, exercise or exchange thereof is less than the Applicable Price,
      then
      such share of Common Stock shall be deemed to be outstanding and to have been
      issued and sold by the Company at the time of the issuance or sale of such
      Convertible Securities for such price per share. For the purposes of this
      Section 2(a)(ii), the "lowest price per share for which one share of Common
      Stock is issuable upon the conversion, exercise or exchange" shall be equal
      to
      the sum of the lowest amounts of consideration (if any) received or receivable
      by the Company with respect to one share of Common Stock upon the issuance
      or
      sale of the Convertible Security and upon conversion, exercise or exchange
      of
      such Convertible Security. No further adjustment of the Exercise Price shall
      be
      made upon the actual issuance of such shares of Common Stock upon conversion,
      exercise or exchange of such Convertible Securities, and if any such issue
      or
      sale of such Convertible Securities is made upon exercise of any Options for
      which adjustment of this Warrant has been or is to be made pursuant to other
      provisions of this Section 2(a), no further adjustment of the Exercise Price
      or
      number of Warrant Shares shall be made by reason of such issue or sale.

     

    
      
        
        

      

      
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    (iii)
      Change
      in Option Price or Rate of Conversion.
      If the
      purchase price provided for in any Options, the additional consideration, if
      any, payable upon the issue, conversion, exercise or exchange of any Convertible
      Securities, or the rate at which any Convertible Securities are convertible
      into
      or exercisable or exchangeable for shares of Common Stock increases or decreases
      at any time, the Exercise Price in effect at the time of such increase or
      decrease shall be adjusted to the Exercise Price which would have been in effect
      at such time had such Options or Convertible Securities provided for such
      increased or decreased purchase price, additional consideration or increased
      or
      decreased conversion rate, as the case may be, at the time initially granted,
      issued or sold. For purposes of this Section 2(a)(iii), if the terms of any
      Option or Convertible Security that was outstanding as of the date of issuance
      of this Warrant are increased or decreased in the manner described in the
      immediately preceding sentence, then such Option or Convertible Security and
      the
      shares of Common Stock deemed issuable upon exercise, conversion or exchange
      thereof shall be deemed to have been issued as of the date of such increase
      or
      decrease. No adjustment pursuant to this Section 2(a) shall be made if such
      adjustment would result in an increase of the Exercise Price then in effect
      or a
      decrease in the number of Warrant Shares.

     

    (iv)
      Calculation
      of Consideration Received.
      In case
      any Option is issued in connection with the issue or sale of other securities
      of
      the Company, together comprising one integrated transaction in which no specific
      consideration is allocated to such Options by the parties thereto, the Options
      will be deemed to have been issued for a consideration of $0.01. If any shares
      of Common Stock, Options or Convertible Securities are issued or sold or deemed
      to have been issued or sold for cash, the consideration received therefor will
      be deemed to be the net amount received by the Company therefor. If any shares
      of Common Stock, Options or Convertible Securities are issued or sold for a
      consideration other than cash, the amount of such consideration received by
      the
      Company will be the fair value of such consideration, except where such
      consideration consists of securities, in which case the amount of consideration
      received by the Company will be the Closing Sale Price of such security on
      the
      date of receipt. If any shares of Common Stock, Options or Convertible
      Securities are issued to the owners of the non-surviving entity in connection
      with any merger in which the Company is the surviving entity, the amount of
      consideration therefor will be deemed to be the fair value of such portion
      of
      the net assets and business of the non-surviving entity as is attributable
      to
      such shares of Common Stock, Options or Convertible Securities, as the case
      may
      be. The fair value of any consideration other than cash or securities will
      be
      determined jointly by the Company and the Required Holders. If such parties
      are
      unable to reach agreement within ten (10) days after the occurrence of an event
      requiring valuation (the "Valuation
      Event"),
      the
      fair value of such consideration will be determined within five (5) Business
      Days after the tenth day following the Valuation Event by an independent,
      reputable appraiser jointly selected by the Company and the Required Holders.
      The determination of such appraiser shall be final and binding upon all parties
      absent manifest error. The reasonable expenses of such appraiser in making
      such
      determination shall be paid by the Company in the event the Holder's calculation
      was correct, or by the Holder in the event the Company's calculation was
      correct, or equally by the Company and the Holder in the event that neither
      the
      Company's or the Holder's calculation was correct.

     

    
      
        
        

      

      
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    (v)
      Record
      Date.
      If the
      Company takes a record of the holders of shares of Common Stock for the purpose
      of entitling them (A) to receive a dividend or other distribution payable
      in shares of Common Stock, Options or in Convertible Securities or (B) to
      subscribe for or purchase shares of Common Stock, Options or Convertible
      Securities, then such record date will be deemed to be the date of the issue
      or
      sale of the shares of Common Stock deemed to have been issued or sold upon
      the
      declaration of such dividend or the making of such other distribution or the
      date of the granting of such right of subscription or purchase, as the case
      may
      be.

     

    (b)  Adjustment
      upon Subdivision or Combination of shares of Common Stock.
      If the
      Company at any time on or after the Subscription Date subdivides (by any stock
      split, stock dividend, recapitalization or otherwise) one or more classes of
      its
      outstanding shares of Common Stock into a greater number of shares, the Exercise
      Price in effect immediately prior to such subdivision will be proportionately
      reduced and the number of Warrant Shares will be proportionately increased.
      If
      the Company at any time on or after the Subscription Date combines (by
      combination, reverse stock split or otherwise) one or more classes of its
      outstanding shares of Common Stock into a smaller number of shares, the Exercise
      Price in effect immediately prior to such combination will be proportionately
      increased and the number of Warrant Shares will be proportionately decreased.
      Any adjustment under this Section 2(b) shall become effective at the close
      of
      business on the date the subdivision or combination becomes
      effective.

     

    (c)  Other
      Events.
      If any
      event occurs of the type contemplated by the provisions of this Section 2 but
      not expressly provided for by such provisions (including, without limitation,
      the granting of stock appreciation rights, phantom stock rights or other rights
      with equity features), then the Company's Board of Directors will make an
      appropriate adjustment in the Exercise Price and, if the event is of the type
      contemplated by Section 2(b), the number of Warrant Shares so as to protect
      the
      rights of the Holder; provided that no such adjustment pursuant to this Section
      2(c) will increase the Exercise Price, or, if the event is other than the type
      contemplated by Section 2(b), decrease the number of Warrant Shares as otherwise
      determined pursuant to this Section 2.

     

    
      
        
        

      

      
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    3.  RIGHTS
      UPON DISTRIBUTION OF ASSETS.
      If the
      Company shall declare or make any dividend or other distribution of its assets
      (or rights to acquire its assets) to holders of shares of Common Stock, by
      way
      of return of capital or otherwise (including, without limitation, any
      distribution of cash, stock or other securities, property or options by way
      of a
      dividend, spin off, reclassification, corporate rearrangement, scheme of
      arrangement or other similar transaction) (a "Distribution"),
      at
      any time after the issuance of this Warrant, then, in each such
      case:

     

    (a)  any
      Exercise Price in effect immediately prior to the close of business on the
      record date fixed for the determination of holders of shares of Common Stock
      entitled to receive the Distribution shall be reduced, effective as of the
      close
      of business on such record date, to a price determined by multiplying such
      Exercise Price by a fraction of which (i) the numerator shall be the Closing
      Bid
      Price of the shares of Common Stock on the Trading Day immediately preceding
      such record date minus the value of the Distribution (as determined in good
      faith by the Company's Board of Directors) applicable to one share of Common
      Stock, and (ii) the denominator shall be the Closing Bid Price of the shares
      of
      Common Stock on the Trading Day immediately preceding such record date;
      and

    

    (b)  the
      number of Warrant Shares shall be increased to a number of shares equal to
      the
      number of shares of Common Stock obtainable immediately prior to the close
      of
      business on the record date fixed for the determination of holders of shares
      of
      Common Stock entitled to receive the Distribution multiplied by the reciprocal
      of the fraction set forth in the immediately preceding paragraph (a); provided
      that in the event that the Distribution is of shares of Common Stock (or common
      stock) ("Other
      Shares of Common Stock")
      of a
      company whose common shares are traded on a national securities exchange or
      a
      national automated quotation system, then the Holder may elect to receive a
      warrant to purchase Other Shares of Common Stock in lieu of an increase in
      the
      number of Warrant Shares, the terms of which shall be identical to those of
      this
      Warrant, except that such warrant shall be exercisable into the number of shares
      of Other Shares of Common Stock that would have been payable to the Holder
      pursuant to the Distribution had the Holder exercised this Warrant immediately
      prior to such record date and with an aggregate exercise price equal to the
      product of the amount by which the exercise price of this Warrant was decreased
      with respect to the Distribution pursuant to the terms of the immediately
      preceding paragraph (a) and the number of Warrant Shares calculated in
      accordance with the first part of this paragraph (b).

     

    4.  PURCHASE
      RIGHTS; FUNDAMENTAL TRANSACTIONS.

     

    (a)  Purchase
      Rights.
      In
      addition to any adjustments pursuant to Section 2 above, if at any time the
      Company grants, issues or sells any Options, Convertible Securities or rights
      to
      purchase stock, warrants, securities or other property pro rata to the record
      holders of any class of shares of Common Stock (the "Purchase
      Rights"),
      then
      the Holder will be entitled to acquire, upon the terms applicable to such
      Purchase Rights, the aggregate Purchase Rights which the Holder could have
      acquired if the Holder had held the number of shares of Common Stock acquirable
      upon complete exercise of this Warrant (without regard to any limitations on
      the
      exercise of this Warrant) immediately before the date on which a record is
      taken
      for the grant, issuance or sale of such Purchase Rights, or, if no such record
      is taken, the date as of which the record holders of shares of Common Stock
      are
      to be determined for the grant, issue or sale of such Purchase
      Rights.

     

    
      
        
        

      

      
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    (b)  Fundamental
      Transactions.
      The
      Company shall not enter into or be party to a Fundamental Transaction unless
      (i)  the Successor Entity assumes in writing all of the obligations of the
      Company under this Warrant and the other Transaction Documents in accordance
      with the provisions of this Section (4)(b) pursuant to written agreements in
      connection with the closing of such Fundamental Transaction, including
      agreements to deliver to each holder of the SPA Warrants in exchange for such
      SPA Warrants a security of the Successor Entity evidenced by a written
      instrument substantially similar in form and substance to this Warrant,
      including, without limitation, an adjusted exercise price equal to the value
      for
      the shares of Common Stock reflected by the terms of such Fundamental
      Transaction, and exercisable for a corresponding number of shares of capital
      stock equivalent to the shares of Common Stock acquirable and receivable upon
      exercise of this Warrant (without regard to any limitations on the exercise
      of
      this Warrant), and (ii) the Successor Entity (including its Parent Entity)
      is a publicly traded corporation whose common stock is quoted on or listed
      for
      trading on an Eligible Market. Upon the occurrence of any Fundamental
      Transaction, the Successor Entity shall succeed to, and be substituted for
      (so
      that from and after the date of such Fundamental Transaction, the provisions
      of
      this Warrant referring to the "Company" shall refer instead to the Successor
      Entity), and may exercise every right and power of the Company and shall assume
      all of the obligations of the Company under this Warrant with the same effect
      as
      if such Successor Entity had been named as the Company herein. Upon consummation
      of the Fundamental Transaction, the Successor Entity shall deliver to the Holder
      confirmation that there shall be issued upon exercise of this Warrant
at
      any
      time after the consummation of the Fundamental Transaction, in lieu of the
      shares of the Common Stock (or
      other
      securities, cash, assets or other property) issuable
      upon the exercise of the Warrant
      prior
      to
      such Fundamental Transaction,
      such
      shares of the publicly traded Common Stock (or its equivalent) of the Successor
      Entity (including its Parent Entity) which the Holder would have been entitled
      to receive upon the happening of such Fundamental Transaction had this Warrant
      been converted immediately prior to such Fundamental Transaction, as adjusted
      in
      accordance with the provisions of this Warrant. In addition to and not in
      substitution for any other rights hereunder, prior to the consummation of any
      Fundamental Transaction pursuant to which holders of shares of Common Stock
      are
      entitled to receive securities or other assets with respect to or in exchange
      for shares of Common Stock (a "Corporate
      Event"),
      the
      Company shall make appropriate provision to insure that the Holder will
      thereafter have the right to receive upon an exercise of this Warrant at any
      time after the consummation of the Fundamental Transaction but prior to the
      Expiration Date, in lieu of the shares of the Common Stock (or other securities,
      cash, assets or other property) issuable upon the exercise of this Warrant
      prior
      to such Fundamental Transaction,
      such
      shares of stock, securities, cash, assets or any other property whatsoever
      (including warrants or other purchase or subscription rights) which the Holder
      would have been entitled to receive upon the happening of such Fundamental
      Transaction had this Warrant been exercised immediately prior to such
      Fundamental Transaction. Provision
      made pursuant to the preceding sentence shall be in a form and substance
      reasonably satisfactory to the Required Holders (such approval not to be
      unreasonably withheld or delayed). The provisions of this Section shall apply
      similarly and equally to successive Fundamental Transactions and Corporate
      Events and shall be applied without regard to any limitations on the exercise
      of
      this Warrant. 

     

    
      
        
        

      

      
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    (c)  Notwithstanding
      the foregoing, in the event of a Fundamental Transaction, at the request of
      the
      Holder delivered before the 90th day after such Fundamental Transaction,
the
      Company (or the Successor Entity) shall purchase this Warrant from the Holder
      by
      paying to the Holder, within five Business Days after such request (or, if
      later, on the effective date of the Fundamental Transaction),
      cash in
      an amount equal to the Black Scholes Value of the remaining unexercised portion
      of this Warrant on the date of such Fundamental Transaction. 

     

    5.  NONCIRCUMVENTION.
      The
      Company hereby covenants and agrees that the Company will not, by amendment
      of
      its Certificate of Incorporation, Bylaws or through any reorganization, transfer
      of assets, consolidation, merger, scheme of arrangement, dissolution, issue
      or
      sale of securities, or any other voluntary action, avoid or seek to avoid the
      observance or performance of any of the terms of this Warrant, and will at
      all
      times in good faith carry out all the provisions of this Warrant and take all
      action as may be required to protect the rights of the Holder. Without limiting
      the generality of the foregoing, the Company (i) shall not increase the par
      value of any shares of Common Stock receivable upon the exercise of this Warrant
      above the Exercise Price then in effect, (ii) shall take all such actions
      as may be necessary or appropriate in order that the Company may validly and
      legally issue fully paid and nonassessable shares of Common Stock upon the
      exercise of this Warrant, and (iii) shall, so long as any of the SPA Warrants
      are outstanding, take all action necessary to reserve and keep available out
      of
      its authorized and unissued shares of Common Stock, solely for the purpose
      of
      effecting the exercise of the SPA Warrants, 100% of the number of shares of
      Common Stock as shall from time to time be necessary to effect the exercise
      of
      the SPA Warrants then outstanding (without regard to any limitations on
      exercise).

     

    6.  WARRANT
      HOLDER NOT DEEMED A STOCKHOLDER.
      Except
      as otherwise specifically provided herein, the Holder, solely in such Person's
      capacity as a holder of this Warrant, shall not be entitled to vote or receive
      dividends or be deemed the holder of share capital of the Company for any
      purpose, nor shall anything contained in this Warrant be construed to confer
      upon the Holder, solely in such Person's capacity as the Holder of this Warrant,
      any of the rights of a stockholder of the Company or any right to vote, give
      or
      withhold consent to any corporate action (whether any reorganization, issue
      of
      stock, reclassification of stock, consolidation, merger, conveyance or
      otherwise), receive notice of meetings, receive dividends or subscription
      rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares
      which such Person is then entitled to receive upon the due exercise of this
      Warrant. In addition, nothing contained in this Warrant shall be construed
      as
      imposing any liabilities on the Holder to purchase any securities (upon exercise
      of this Warrant or otherwise) or as a stockholder of the Company, whether such
      liabilities are asserted by the Company or by creditors of the Company.
      Notwithstanding this Section 6, the Company shall provide the Holder with copies
      of the same notices and other information given to the stockholders of the
      Company generally, contemporaneously with the giving thereof to the
      stockholders.

     

    
      
        
        

      

      
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    7.  REISSUANCE
      OF WARRANTS.

     

    (a)  Transfer
      of Warrant.
      If this
      Warrant is to be transferred, the Holder shall surrender this Warrant to the
      Company, whereupon the Company will forthwith issue and deliver upon the order
      of the Holder (subject to the limitations set forth in the legend on the face
      of
      this Warrant) a new Warrant (issued in accordance with Section 7(d)), registered
      as the Holder may request, representing the right to purchase the number of
      Warrant Shares being transferred by the Holder and, if less then the total
      number of Warrant Shares then underlying this Warrant is being transferred,
      a
      new Warrant (issued in accordance with Section 7(d)) to the Holder representing
      the right to purchase the number of Warrant Shares not being
      transferred.

     

    (b)  Lost,
      Stolen or Mutilated Warrant.
      Upon
      receipt by the Company of evidence reasonably satisfactory to the Company of
      the
      loss, theft, destruction or mutilation of this Warrant, and, in the case of
      loss, theft or destruction, of any indemnification undertaking by the Holder
      to
      the Company in customary form and, in the case of mutilation, upon surrender
      and
      cancellation of this Warrant, the Company shall execute and deliver to the
      Holder a new Warrant (issued in accordance with Section 7(d)) representing
      the
      right to purchase the Warrant Shares then underlying this Warrant.

     

    (c)  Exchangeable
      for Multiple Warrants.
      This
      Warrant is exchangeable, upon the surrender hereof by the Holder at the
      principal office of the Company, for a new Warrant or Warrants (issued in
      accordance with Section 7(d)) representing in the aggregate the right to
      purchase the number of Warrant Shares then underlying this Warrant, and each
      such new Warrant will represent the right to purchase such portion of such
      Warrant Shares as is designated by the Holder at the time of such surrender;
      provided, however, that no Warrants for fractional shares of Common Stock shall
      be given.

     

    (d)  Issuance
      of New Warrants.
      Whenever the Company is required to issue a new Warrant pursuant to the terms
      of
      this Warrant, such new Warrant (i) shall be of like tenor with this Warrant,
      (ii) shall represent, as indicated on the face of such new Warrant, the right
      to
      purchase the Warrant Shares then underlying this Warrant (or in the case of
      a
      new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant
      Shares designated by the Holder which, when added to the number of shares of
      Common Stock underlying the other new Warrants issued in connection with such
      issuance, does not exceed the number of Warrant Shares then underlying this
      Warrant), (iii) shall have an issuance date, as indicated on the face of such
      new Warrant which is the same as the Issuance Date, and (iv) shall have the
      same
      rights and conditions as this Warrant.

     

    8.  NOTICES.
      Whenever notice is required to be given under this Warrant, unless otherwise
      provided herein, such notice shall be given in accordance with Section 9(f)
      of
      the Securities Purchase Agreement. The Company shall provide the Holder with
      prompt written notice of all actions taken pursuant to this Warrant, including
      in reasonable detail a description of such action and the reason therefor.
      Without limiting the generality of the foregoing, the Company will give written
      notice to the Holder (i) immediately upon any adjustment of the Exercise Price,
      setting forth in reasonable detail, and certifying, the calculation of such
      adjustment and (ii) at least fifteen days prior to the date on which the Company
      closes its books or takes a record of the holders of shares of Common Stock
      (A)
      with respect to any dividend or distribution upon the shares of Common Stock,
      (B) with respect to any grants, issuances or sales of any Options, Convertible
      Securities or rights to purchase stock, warrants, securities or other property
      to holders of shares of Common Stock or (C) for determining rights to vote
      with
      respect to any Fundamental Transaction, dissolution or liquidation, provided
      in
      each case that such information shall be made known to the public prior to
      or in
      conjunction with such notice being provided to the Holder.

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

     

    9.  AMENDMENT
      AND WAIVER.
      Except
      as otherwise provided herein, the provisions of this Warrant may be amended
      and
      the Company may take any action herein prohibited, or omit to perform any act
      herein required to be performed by it, only if the Company has obtained the
      written consent of the Required Holders and any such amendment or action so
      approved shall be binding upon all existing and future Holders of this Warrant;
      provided that no such action may increase the exercise price of any SPA Warrant
      or decrease the number of shares or class of stock obtainable upon exercise
      of
      any SPA Warrant without the written consent of the Holder. No such amendment
      shall be effective to the extent that it applies to less than all of the holders
      of the SPA Warrants then outstanding.

     

    10.  GOVERNING
      LAW.
      This
      Warrant shall be governed by and construed and enforced in accordance with,
      and
      all questions concerning the construction, validity, interpretation and
      performance of this Warrant shall be governed by, the internal laws of the
      State
      of New York, without giving effect to any choice of law or conflict of law
      provision or rule (whether of the State of New York or any other jurisdictions)
      that would cause the application of the laws of any jurisdictions other than
      the
      State of New York.

     

    11.  CONSTRUCTION;
      HEADINGS.
      This
      Warrant shall be deemed to be jointly drafted by the Company and all the Buyers
      and shall not be construed against any person as the drafter hereof. The
      headings of this Warrant are for convenience of reference and shall not form
      part of, or affect the interpretation of, this Warrant.

     

    12.  DISPUTE
      RESOLUTION.
      In the
      case of a dispute as to the determination of the Exercise Price or the
      arithmetic calculation of the Warrant Shares, the Company shall instruct the
      Transfer Agent to issue to the Holder the number of shares of Common Stock
      that
      is not disputed and shall transmit an explanation of the disputed determinations
      or arithmetic calculations to the Holder via facsimile as soon as possible,
      but
      in no event later than two (2) Business Days after receipt of such Holder's
      Exercise Notice or other date of determination. If such Holder and the Company
      are unable to agree upon the determination of the Exercise Price or arithmetic
      calculation of the Warrant Shares within two (2) Business Days of such disputed
      determination or arithmetic calculation being transmitted to the Holder, then
      the Company shall within one (1) Business Day of such two (2) Business Day
      period submit via facsimile (A) the disputed determination of the Exercise
      Price
      to an independent, reputable investment bank selected by the Company and
      approved by the Holder or (B) the disputed arithmetic calculation of the Warrant
      Shares to the Company's independent, outside accountant. The Company shall
      cause
      the investment bank or the accountant, as the case may be, to perform the
      determinations or calculations and notify the Company and the Holder of the
      results no later than two (2) Business Days from the time it receives the
      disputed determinations or calculations. Such investment bank's or accountant's
      determination or calculation, as the case may be, shall be binding upon all
      parties absent error. The reasonable expenses of such investment bank or
      accountant in making such determination shall be paid by the Company in the
      event the Holder's calculation was correct, or by the Holder in the event the
      Company's calculation was correct, or equally by the Company and the Holder
      in
      the event that neither the Company's or the Holder's calculation was
      correct.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    13.  REMEDIES,
      OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF.
      The
      remedies provided in this Warrant shall be cumulative and in addition to all
      other remedies available under this Warrant and the other Transaction Documents,
      at law or in equity (including a decree of specific performance and/or other
      injunctive relief), and nothing herein shall limit the right of the Holder
      right
      to pursue actual damages for any failure by the Company to comply with the
      terms
      of this Warrant. The Company acknowledges that a breach by it of its obligations
      hereunder will cause irreparable harm to the Holder and that the remedy at
      law
      for any such breach may be inadequate. The Company therefore agrees that, in
      the
      event of any such breach or threatened breach, the holder of this Warrant shall
      be entitled, in addition to all other available remedies, to an injunction
      restraining any breach, without the necessity of showing economic loss and
      without any bond or other security being required.

     

    14.  TRANSFER.
      This
      Warrant may be offered for sale, sold, transferred or assigned without the
      consent of the Company, except as may otherwise be required by Section 2(f)
      of
      the Securities Purchase Agreement.

     

    15.  CERTAIN
      DEFINITIONS.
      For
      purposes of this Warrant, the following terms shall have the following
      meanings:

     

    (a)  "Black
      Scholes Value"
      means
      the value of this Warrant based on the Black and Scholes Option Pricing Model
      obtained from the "OV" function on Bloomberg determined as of the day of closing
      of the applicable Fundamental Transaction for pricing purposes and reflecting
      (i) a risk-free interest rate corresponding to the U.S. Treasury rate for a
      period equal to the remaining term of this Warrant as of such date of request
      and (ii) an expected volatility equal to the greater of 50% and the 100 day
      volatility obtained from the HVT function on Bloomberg as of the day of the
      public announcement of the applicable Fundamental Transaction.

     

    (b)  "Bloomberg"
      means
      Bloomberg Financial Markets.

     

    (c)  "Business
      Day"
      means
      any day other than Saturday, Sunday or other day on which commercial banks
      in
      The City of New York are authorized or required by law to remain
      closed.

     

    (d)  "Closing
      Bid Price"
      and
      "Closing
      Sale Price"
      means,
      for any security as of any date, the last closing bid price and last closing
      trade price, respectively, for such security on the Principal Market, as
      reported by Bloomberg, or, if the Principal Market begins to operate on an
      extended hours basis and does not designate the closing bid price or the closing
      trade price, as the case may be, then the last bid price or last trade price,
      respectively, of such security prior to 4:00:00 p.m., New York time, as reported
      by Bloomberg, or, if the Principal Market is not the principal securities
      exchange or trading market for such security, the last closing bid price or
      last
      trade price, respectively, of such security on the principal securities exchange
      or trading market where such security is listed or traded as reported by
      Bloomberg, or if the foregoing do not apply, the last closing bid price or
      last
      trade price, respectively, of such security in the over-the-counter market
      on
      the electronic bulletin board for such security as reported by Bloomberg, or,
      if
      no closing bid price or last trade price, respectively, is reported for such
      security by Bloomberg, the average of the bid prices, or the ask prices,
      respectively, of any market makers for such security as reported in the "pink
      sheets" by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.).
      If
      the Closing Bid Price or the Closing Sale Price cannot be calculated for a
      security on a particular date on any of the foregoing bases, the Closing Bid
      Price or the Closing Sale Price, as the case may be, of such security on such
      date shall be the fair market value as mutually determined by the Company and
      the Holder. If the Company and the Holder are unable to agree upon the fair
      market value of such security, then such dispute shall be resolved pursuant
      to
      Section 12. All such determinations to be appropriately adjusted for any stock
      dividend, stock split, stock combination or other similar transaction during
      the
      applicable calculation period.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    (e)  "Common
      Stock"
      means
      (i) the Company's shares of Common Stock, par value $0.001 per share, and
      (ii) any share capital into which such Common Stock shall have been changed
      or any share capital resulting from a reclassification of such Common
      Stock.

     

    (f)  "Common
      Stock Deemed Outstanding"
      means,
      at any given time, the number of shares of Common Stock actually outstanding
      at
      such time, plus the number of shares of Common Stock deemed to be outstanding
      pursuant to Sections 2(a)(i) and 2(a)(ii) hereof regardless of whether the
      Options or Convertible Securities are actually exercisable at such time, but
      excluding any shares of Common Stock owned or held by or for the account of
      the
      Company or issuable upon conversion and exercise, as applicable, of the SPA
      Securities and the Warrants.

     

    (g)  "Convertible
      Securities"
      means
      any stock or securities (other than Options) directly or indirectly convertible
      into or exercisable or exchangeable for shares of Common Stock.

     

    (h)  "Eligible
      Market"
      means
      the Principal Market, The New York Stock Exchange, Inc., the American Stock
      Exchange, The NASDAQ Global Market or The NASDAQ Global Select
      Market.

     

    (i)  "Expiration
      Date"
      means
      the date thirty-six months after the Issuance Date or, if such date falls on
      a
      day other than a Business Day, the next date that is a Business
      Day.

     

    (j)  "Fundamental
      Transaction"
      means
      that (a) the Company shall, directly or indirectly, in one or more related
      transactions, (i) consolidate or merge with or into (whether or not the Company
      is the surviving corporation) another Person, or (ii) sell, assign, transfer,
      convey or otherwise dispose of all or substantially all of the properties or
      assets of the Company to another Person, or (iii) allow another Person to make
      a
      purchase, tender or exchange offer that is accepted by the holders of more
      than
      the 50% of the outstanding shares of Common Stock (not including any shares
      of
      Common Stock held by the Person or Persons making or party to, or associated
      or
      affiliated with the Persons making or party to, such purchase, tender or
      exchange offer), or (iv) consummate a stock purchase agreement or other business
      combination (including, without limitation, a reorganization, recapitalization,
      spin-off or scheme of arrangement) with another Person whereby such other Person
      acquires more than the 50% of the outstanding shares of Common Stock (not
      including any shares of Common Stock held by the other Person or other Persons
      making or party to, or associated or affiliated with the other Persons making
      or
      party to, such stock purchase agreement or other business combination), or
      (v)
      reorganize, recapitalize or reclassify its Common Stock, or (b) any "person"
      or
      "group" (as these terms are used for purposes of Sections 13(d) and 14(d) of
      the
      Exchange Act) is or shall become the "beneficial owner" (as defined in Rule
      13d-3 under the Exchange Act), directly or indirectly, of 50% of the aggregate
      ordinary voting power represented by issued and outstanding Common Stock or
      (c)
      a replacement at one time or over time of more than one-half of the members
      of
      the Company’s board of directors which is not approved by a majority of those
      individuals who are members of the board of directors on the Issuance Date
      (or
      by those individuals who are serving as members of the board of directors on
      any
      date whose nomination to the board of directors was approved by a majority
      of
      the members of the board of directors or members of the board’s Nominating and
      Corporate Governance Committee who are also members of the board or the board’s
      Nominating and Corporate Governance Committee, as the case may be, on the
      Issuance Date). A Fundamental Transaction shall not be deemed to include any
      of
      the transactions contemplated by the Stock Purchase Agreement between the
      Company and The Dow Chemical Company dated as of February 27, 2005 as amended
      prior to the Issuance Date, and not amended in any respect material to the
      Holders after the April 25, 2005.

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

     

    (k)  "Options"
      means
      any rights, warrants or options to subscribe for or purchase shares of Common
      Stock or Convertible Securities.

     

    (l)  "Parent
      Entity"
      of a
      Person means an entity that, directly or indirectly, controls the applicable
      Person and whose common stock or equivalent equity security is quoted or listed
      on an Eligible Market, or, if there is more than one such Person or Parent
      Entity, the Person or Parent Entity with the largest public market
      capitalization as of the date of consummation of the Fundamental
      Transaction.

     

    (m)  "Person"
      means
      an individual, a limited liability company, a partnership, a joint venture,
      a
      corporation, a trust, an unincorporated organization, any other entity and
      a
      government or any department or agency thereof.

     

    (n)  "Principal
      Market"
      means
      The NASDAQ Capital Market.

     

    (o)  "Registration
      Rights Agreement"
      means
      that certain registration rights agreement by and among the Company and the
      Buyers.

     

    (p)  "Required
      Holders"
      means
      the holders of the SPA Warrants representing at least a majority of shares
      of
      Common Stock underlying the SPA Warrants then outstanding.

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    (q)  "SPA
      Securities"
      means
      the Debentures issued pursuant to the Securities Purchase
      Agreement.

     

    (r)  "Successor
      Entity"
      means
      the Person (or, if so elected by the Required Holders, the Parent Entity) formed
      by, resulting from or surviving any Fundamental Transaction or the Person (or,
      if so elected by the Required Holders, the Parent Entity) with which such
      Fundamental Transaction shall have been entered into.

     

    (s)  "Trading
      Day"
      means
      any day on which the Common Stock are traded on the Principal Market, or, if
      the
      Principal Market is not the principal trading market for the Common Stock,
      then
      on the principal securities exchange or securities market on which the Common
      Stock are then traded; provided that "Trading Day" shall not include any day
      on
      which the Common Stock are scheduled to trade on such exchange or market for
      less than 4.5 hours or any day that the Common Stock are suspended from trading
      during the final hour of trading on such exchange or market (or if such exchange
      or market does not designate in advance the closing time of trading on such
      exchange or market, then during the hour ending at 4:00:00 p.m., New York
      time).

     

    [Signature
      Page Follows]

    
      

        
          
            
            

          

          
            -18-

            
              

            

          

          
            
            

          

        

      

       

    

    IN
      WITNESS WHEREOF,
      the
      Company has caused this Warrant to Purchase Common Stock to be duly executed
      as
      of the Issuance Date set out above.

    
      	 	 	 
	 	MILLENNIUM CELL
              INC.
	 
 	 
 	 
 
	 	By:  	/s/ John
              D. Giolli
	 	
              

              Name: John
                D. Giolli

              Title: Chief
                Financial Officer

            
	 	
            

    

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    EXERCISE
      NOTICE

    TO
      BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS

    WARRANT
      TO PURCHASE COMMON STOCK

    

    MILLENNIUM
      CELL INC.

     

    The
      undersigned holder hereby exercises the right to purchase _________________
      of
      the shares of Common Stock ("Warrant
      Shares")
      of
      Millennium Cell Inc., a Delaware corporation (the "Company"),
      evidenced by the attached Warrant to Purchase Common Stock (the "Warrant").
      Capitalized terms used herein and not otherwise defined shall have the
      respective meanings set forth in the Warrant.

    

    1.
      Form
      of Exercise Price. The Holder intends that payment of the Exercise Price shall
      be made as:

    

    ____________ a
      "Cash
      Exercise"
      with
      respect to _________________ Warrant Shares; and/or

    

    ____________ a
      "Cashless
      Exercise"
      with
      respect to _______________ Warrant Shares.

    

    2.
      Payment of Exercise Price. In the event that the holder has elected a Cash
      Exercise with respect to some or all of the Warrant Shares to be issued pursuant
      hereto, the holder shall pay the Aggregate Exercise Price in the sum of
      $___________________ to the Company in accordance with the terms of the
      Warrant.

    

    3.
      Delivery of Warrant Shares. The Company shall deliver to the holder __________
      Warrant Shares in accordance with the terms of the Warrant.

    

    4.
      By
      its
      delivery of this Exercise Notice, the undersigned represents and warrants to
      the
      Company that in giving effect to the exercise evidenced hereby the Holder will
      not beneficially own in excess of the number of shares of Common Stock
      (determined in accordance with Section 13(d) of the Securities Exchange Act
      of
      1934) permitted to be owned under Section 1(f)(i) of the Warrant.

     

     

    
      	 	 	 	 	 
	Date: _______________ __,
              ______	 	 	 
	 	 	 	 
	 	
              
Name
              of Registered Holder	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	By:	 	 	 	
            
	 	
              

              Name:

              Title:

            	 	 	
            
	 	 	 	 	
            

    

    
 

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    ACKNOWLEDGMENT

    

    The
      Company hereby acknowledges this Exercise Notice and hereby directs American
      Stock Transfer & Trust Company to issue the above indicated number of shares
      of Common Stock in accordance with the Transfer Agent Instructions dated
      February [ ], 2007 from the Company and acknowledged and agreed to by American
      Stock Transfer & Trust Company.

    
      	 	 	 
	 	MILLENNIUM CELL
              INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
              

              Name:

              Title:

            
	 	 

    
      
        
        

      

      
        -21-

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