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<td width="15%" valign="top"><p>&#160;</p>
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<td width="69%" style="border-top: 0.0133333in solid; border-bottom: 0.0133333in solid" align="center" valign="top"><p>EXHIBIT 10.2</p>
</td>
<td width="16%" valign="top"><p>&#160;</p>
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<td width="100%" valign="top"><p>&#160;</p>
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<td width="100%" valign="top"><p>THESE SECURITIES, INCLUDING THE SECURITIES INTO WHICH THEY MAY BE
CONVERTED, HAVE BEEN ISSUED IN RELIANCE UPON THE EXEMPTION FROM
REGISTRATION AFFORDED BY SECTION 4(2) OF THE SECURITIES ACT OF 1933,
AS AMENDED, AND MAY NOT BE TRANSFERRED WITHOUT AN OPINION OF
COUNSEL SATISFACTORY TO THE CORPORATION TO THE EFFECT THAT ANY
SUCH PROPOSED TRANSFER IS IN ACCORDANCE WITH ALL APPLICABLE LAWS,
RULES AND REGULATIONS.</p>
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<td width="100%" valign="top"><p>&#160;</p>
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<td width="100%" align="center" valign="top"><p>Diamond I, Inc.</p>
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<td width="100%" align="center" valign="top"><p>(Incorporated Under the Laws of the State of Delaware)</p>
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<td width="100%" align="center" valign="top"><p>3,500,000 COMMON STOCK PURCHASE WARRANTS</p>
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<td width="100%" align="center" valign="top"><p>(EACH WARRANT ENTITLES THE HOLDER TO PURCHASE ONE COMMON SHARE)</p>
<p>INITIAL WARRANT EXERCISE PRICE $.04</p>
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<td width="100%" valign="top"><p>&#160;</p>
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<td width="100%" valign="top"><p>THIS CERTIFIES THAT, for value received, NORTHEAST SECURITIES, INC. (the
&#8220;Holder&#8221;), as registered owner of this Common Stock Purchase Warrant (a &#8220;Warrant&#8221; or the
&#8220;Warrants&#8221;), is entitled at any time or from time to time after issuance hereof at or before 5:00
p.m., Central Time, on November 30, 2010 (the &#8220;Expiration Date&#8221;), to subscribe for, purchase
and receive the above-specified, fully-paid and non-assessable Common Shares, $.001 par
value per share (the &#8220;Common Shares&#8221;), of Diamond I, Inc., a Delaware corporation (the
&#8220;Company&#8221;), at the purchase price of $.04 per share (the &#8220;Exercise Price&#8221;), upon presentation
and surrender of this Warrant and payment of the Exercise Price for such Common Shares of
the Company at the principal office of the Company, but only subject to the conditions set
forth herein.  The Exercise Price and the number of Common Shares purchasable upon
exercise of each Warrant are subject to adjustments upon the occurrence of certain events
described herein.</p>
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<td width="100%" valign="top"><p>Upon due presentment for transfer of this Warrant at the principal office of the Company, a
new Warrant of like tenor and evidencing, in the aggregate, a like number of Warrants, subject
to any adjustments made in accordance with the provisions hereof, shall be issued to the
transferee in exchange for this Warrant, subject to the limitations provided herein, upon
payment of any tax or governmental charge imposed in connection with such transfer.</p>
</td>
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</table>
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<td width="100%" valign="top"><p>The holder of the Warrants evidenced hereby may exercise all or any whole number of such
Warrants during the period and in the manner stated herein.  The Exercise Price payable in
lawful money of the United States of America and in cash or by certified or bank cashier&#8217;s
check or bank draft payable to the order of the Company.  If, upon exercise of any Warrants
evidenced hereby, the number of Warrants exercised shall be less than the total number of
Warrants so evidenced, there shall be issued to the Warrantholder a new Warrant evidencing
the number of Warrants not so exercised.</p>
</td>
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</table>
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<td width="100%" valign="top"><p>No Warrant may be exercised after 5:00 p.m., Central Time, on the Expiration Date and any
Warrant not exercised by such time shall become void, unless extended by the Company.</p>
</td>
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<td width="100%" valign="top"><p>The Company covenants that it will, at all times, reserve and have available from its
authorized shares of Common Stock such number of shares of Common Stock as shall then be
issuable on exercise of all outstanding Warrants.  The Company covenants that all Warrant
Shares, when issued, shall be duly and validly issued, fully paid and non-assessable, and free
from all taxes, liens and charges with respect to the issue thereof.</p>
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<td width="50%" style="border-bottom: 0.0133333in solid" valign="top"><p>Adjustment of Exercise Price and Shares</p>
</td>
<td width="50%" valign="top"><p>&#160;</p>
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<td width="8%" align="right" valign="top"><p>A.</p>
</td>
<td width="92%" valign="top"><p>In the event, prior to the expiration of the Warrants by exercise or by their terms, the
Company shall issue any of its Common Stock as a stock dividend or shall subdivide
the number of outstanding shares of Common Stock into a greater number of shares,
then, in either of such events, the Exercise Price in effect at the time of such action
shall be reduced proportionately and the number of shares of Common Stock
purchasable pursuant to the Warrants shall be increased proportionately.  Conversely,
in the event the Company shall reduce the number of its outstanding shares of
Common Stock by combining such shares into a smaller number of shares, then, in
such event, the Exercise Price in effect at the time of such action shall be increased
proportionately and the number of shares of Common Stock at that time purchasable
pursuant to the Warrants shall be decreased proportionately.  Such stock dividend paid
or distributed on the Common Stock in shares of any other class of the Company or
securities convertible into shares of Common Stock shall be treated as a dividend paid
or distributed in shares of Common Stock to the extent shares of Common Stock are
issuable on the payment or conversion thereof.</p>
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<td width="8%" align="right" valign="top"><p>B.</p>
</td>
<td width="92%" valign="top"><p>In the event, prior to the expiration of the Warrants by exercise or by their terms, the
Company shall be recapitalized by reclassifying its outstanding shares of Common
Stock into shares with a different par value, or by changing its outstanding Common
Stock to shares without par value or in the event of any other material change of the
capital structure of the Company or of any successor corporation by reason of any
reclassification, recapitalization or conveyance, prompt, proportionate, equitable,
lawful and adequate provision shall be made whereby any holder of the Warrants shall
thereafter have the right to purchase, on the basis and the terms and conditions
specified in this Agreement, in lieu of the shares of Common Stock of the Company
theretofore purchasable on the exercise of any Warrant, such securities or assets as may
be issued or payable with respect to, or in exchange for, the number of shares of
Common Stock of the Company theretofore purchasable on exercise of the Warrants
had such reclassification, recapitalization or conveyance not taken place; and, in any
such event, the rights of any holder of a Warrant to any adjustment in the number of
shares of Common Stock purchasable on exercise of such Warrant, as set forth above,
shall continue and be preserved in respect of any stock, securities or assets which the
holder becomes entitled to purchase; provided, however, that a merger, acquisition of a
going business or a portion thereof (whether for cash, stock, notes, other securities, or a
combination of cash and securities), exchange of stock for stock, exchange of stock for
assets, or like transaction involving the Company, in which the Company is the
surviving entity, will not be considered a &#8220;material change&#8221; for purposes of this
paragraph, and no adjustment shall be made hereunder by reason of any such merger,
acquisition, exchange of stock for stock, exchange of stock for assets, or like
transaction.</p>
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<td width="8%" align="right" valign="top"><p>C.</p>
</td>
<td width="92%" valign="top"><p>In the event the Company, at any time while the Warrants shall remain unexpired and
unexercised, shall sell all or substantially all of its property, or dissolves, liquidates or
winds up its affairs, prompt, proportionate, equitable, lawful and adequate provision
shall be made as part of the terms of such sale, dissolution, liquidation or winding up
such that the holder of a  Warrant may thereafter receive, on exercise of such Warrant,
in lieu of each share of Common Stock of the Company which such holder would have
been entitled to receive upon exercise of such Warrant, the same kind and amount of
any stock, securities or assets as may be issuable, distributable or payable on any such
sale, dissolution, liquidation or winding up with respect to each share of Common
Stock of the Company; provided, however, that, in the event of any such sale,
dissolution, liquidation or winding up, the right to exercise the Warrants shall
terminate on a date fixed by the Company, such date to be not earlier than 5:00 p.m.,
Central Time, on the 30th day next succeeding the date on which notice of such
termination of the right to exercise the Warrants has been given by mail to the holders
thereof at such addresses as may appear on the books of the Company.</p>
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<td width="8%" align="right" valign="top"><p>D.</p>
</td>
<td width="92%" valign="top"><p>In the event, prior to the expiration of the Warrants by exercise or by their terms, the
Company shall take a record of the holders of its Common Stock for the purpose of
entitling them to purchase shares of its Common Stock at a price per share more than
10% below the then-current market price per share (as defined below) of its Common
Stock at the date of taking such record, then (i) the number of shares of Common Stock
purchasable pursuant to the Warrants shall be redetermined as follows: the number of
shares of Common Stock purchasable pursuant to a Warrant immediately prior to such
adjustment (taking into account fractional interests to the nearest 1,000th of a share)
shall be multiplied by a fraction, the numerator of which shall be the number of shares
of Common Stock of the Company then outstanding (excluding the Common Stock
then owned by the Company) immediately prior to the taking of such record, plus the
number of additional shares offered for purchase, and the denominator of which shall
be the number of shares of Common Stock of the Company outstanding (excluding the
Common Stock owned by the Company) immediately prior to the taking of such
record, plus the number of shares which the aggregate offering price of the total
number of additional shares so offered would purchase at such current market price;
and (ii) the Exercise Price per share of Common Stock purchasable pursuant to a
Warrant shall be redetermined as follows:  the Exercise Price in effect immediately
prior to the taking of such record shall be multiplied by a fraction, the numerator of
which is the number of shares of Common Stock purchasable immediately prior to the
taking of such record, and the denominator of which is the number of shares of
Common Stock purchasable immediately after the taking of such record as determined
pursuant to clause (i) above.  For the purpose hereof, the current market price per share
of Common Stock of the Company at any date shall be deemed to be the average of the
closing prices, as reported by the Company&#8217;s primary trading market, for 20
consecutive business days commencing 15 business days prior to the record date.</p>
</td>
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<td width="8%" align="right" valign="top"><p>E.</p>
</td>
<td width="92%" valign="top"><p>On exercise of the Warrants by the holders, the Company shall not be required to
deliver fractions of shares of Common Stock; provided, however, that prompt,
proportionate, equitable, lawful and adequate adjustment in the Exercise Price payable
shall be made in respect of any such fraction of one share of Common Stock on the
basis of the Exercise Price per share.</p>
</td>
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<td width="8%" align="right" valign="top"><p>F.</p>
</td>
<td width="92%" valign="top"><p>In the event, prior to expiration of the Warrants by exercise or by their terms, the
Company shall determine to take a record of the holders of its Common Stock for the
purpose of determining shareholders entitled to receive any stock dividend, distribution
or other right which will cause any change or adjustment in the number, amount, price
or nature of the Common Stock or other stock, securities or assets deliverable on
exercise of the Warrants pursuant to the foregoing provisions, the Company shall give
to the Registered Holders of the Warrants at the addresses as may appear on the books
of the Company at least 15 days&#8217; prior written notice to the effect that it intends to take
such a record.  Such notice shall specify the date as of which such record is to be taken;
the purpose for which such record is to be taken; and the number, amount, price and
nature of the Common Stock or other stock, securities or assets which will be
deliverable on exercise of the Warrants after the action for which such record will be
taken has been completed.  Without limiting the obligation of the Company to provide
notice to the Registered Holders of the Warrant Certificates of any corporate action
hereunder, the failure of the Company to give notice shall not invalidate such corporate
action of the Company.</p>
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<td width="8%" align="right" valign="top"><p>G.</p>
</td>
<td width="92%" valign="top"><p>The Warrant shall not entitle the holder thereof to any of the rights of shareholders or
to any dividend declared on the Common Stock, unless the Warrant is exercised and
the Warrant Shares purchased prior to the record date fixed by the Board of Directors
of the Company for the determination of holders of Common Stock entitled to such
dividend or other right.</p>
</td>
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<td width="8%" align="right" valign="top"><p>H.</p>
</td>
<td width="92%" valign="top"><p>No adjustment of the Exercise Price shall be made as a result of, or in connection with,
(i) the establishment of one or more employee stock option plans for employees of the
Company, or the modification, renewal or extension of any such plan, or the issuance
of Common Stock on exercise of any options pursuant to any such plan, (ii) the
issuance of individual warrants or options to purchase Common Stock, the issuance of
Common Stock upon exercise of such warrants or options, or the issuance of Common
Stock in connection with compensation arrangements for directors, officers,
employees, consultants or agents of the Company or any Subsidiary, and the like, or
(iii) the issuance of Common Stock in connection with a merger, acquisition of a going
business or a portion thereof (whether for cash, stock, notes, other securities, or a
combination of cash and securities), exchange of stock for stock, exchange of stock for
assets, or like transaction.</p>
</td>
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</table>
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<td width="100%" valign="top"><p>IN WITNESS WHEREOF, the Company has caused this Warrant to be duly signed by its
President.</p>
</td>
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<td width="100%" valign="top"><p>Dated: November 11, 2005.</p>
</td>
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<td width="50%" valign="top"><p>&#160;</p>
</td>
<td width="50%" valign="top"><p>DIAMOND I, INC.</p>
</td>
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</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="50%" valign="top"><p>&#160;</p>
</td>
<td width="50%" valign="top"><p>By: /s/ DAVID LOFLIN</p>
</td>
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<td width="50%" valign="top"><p>&#160;</p>
</td>
<td width="50%" valign="top"><p>David Loflin</p>
</td>
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<td width="50%" valign="top"><p>&#160;</p>
</td>
<td width="50%" valign="top"><p>President</p>
</td>
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</table>
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<td width="100%" valign="top"><p>&#160;</p>
</td>
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</table>
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<td width="100%" align="center" valign="top"><p>FORM OF ASSIGNMENT</p>
</td>
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<td width="100%" align="center" valign="top"><p>To Be Executed by the Registered Holder if He Desires to Assign Warrants Evidenced Hereby</p>
</td>
</tr>
</table>
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<td width="31%" valign="top"><p>FOR VALUE RECEIVED</p>
</td>
<td width="69%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="43%" valign="top"><p>hereby sells, assigns and transfers unto</p>
</td>
<td width="57%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
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<td width="13%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
<td width="87%" valign="top"><p>Warrants, evidenced hereby, and does hereby irrevocably constitute and appoint</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="100%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" valign="top"><p>Attorney to transfer the said Warrants, evidenced hereby on the books of the Company, with
full power of substitution.</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="10%" valign="top"><p>Dated:</p>
</td>
<td width="27%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
<td width="13%" valign="top"><p>&#160;</p>
</td>
<td width="50%" style="border-bottom: 0.0133333in solid" valign="top"><p>X</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="50%" valign="top"><p>&#160;</p>
</td>
<td width="50%" align="center" valign="top"><p>Signature</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="100%" valign="top"><p>NOTICE:  The above signature must correspond with the name as written upon the face of this
Warrant in every particular, without alteration or enlargement or any change whatsoever.</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="100%" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="26%" valign="top"><p>Signature Guaranteed:</p>
</td>
<td width="74%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
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<td width="100%" align="center" valign="top"><p>FORM OF ELECTION TO PURCHASE</p>
</td>
</tr>
<tr>
<td width="100%" align="center" valign="top"><p>To be Executed by the Holder if He Desires to Exercise Warrants Evidenced Hereby</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" valign="top"><p>TO: DIAMOND I, INC.</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="58%" valign="top"><p>The undersigned hereby irrevocably elects to exercise</p>
</td>
<td width="17%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
<td width="25%" valign="top"><p>Warrants evidenced </p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="42%" valign="top"><p>hereby for, and to purchase hereunder,</p>
</td>
<td width="24%" valign="top"><p>&#160;</p>
</td>
<td width="34%" valign="top"><p>full shares of Common Stock </p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="60%" valign="top"><p>issuable upon exercise of said Warrants and delivery of</p>
</td>
<td width="27%" style="border-bottom: 0.0133333in solid" valign="top"><p>$</p>
</td>
<td width="13%" valign="top"><p>and any</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" valign="top"><p>applicable taxes.  The undersigned requests that certificates for such shares be issued in the
name of:</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" style="border-bottom: 0.0133333in solid" align="center" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" align="center" valign="top"><p>(Please print name and address)</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" valign="top"><p>If said number of Warrants shall not be all the Warrants evidenced hereby, the undersigned
requests that a new Warrant Certificate evidencing the Warrants not so exercised be issued in
the name of and delivered to:</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" style="border-bottom: 0.0133333in solid" align="center" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" align="center" valign="top"><p>(Please print name and address)</p>
</td>
</tr>
</table>
<br>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="10%" valign="top"><p>Dated:</p>
</td>
<td width="27%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
</td>
<td width="13%" valign="top"><p>&#160;</p>
</td>
<td width="50%" style="border-bottom: 0.0133333in solid" valign="top"><p>X</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="50%" valign="top"><p>&#160;</p>
</td>
<td width="50%" align="center" valign="top"><p>Signature</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" valign="top"><p>NOTICE:  The above signature must correspond with the name as written upon the face of the
within Warrant Certificate in every particular, without alteration or enlargement or any change
whatsoever, or if signed by any other person the Form of Assignment hereon must be duly
executed and if the certificate representing the shares or any Warrant Certificate representing
Warrants not exercised is to be registered in a name other than in which the within Warrant
Certificate is registered, the signature of the holder hereof must be guaranteed.</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="100%" valign="top"><p>&#160;</p>
</td>
</tr>
</table>
<table width="100%" cellpadding="6" cellspacing="0">
<tr>
<td width="26%" valign="top"><p>Signature Guaranteed:</p>
</td>
<td width="74%" style="border-bottom: 0.0133333in solid" valign="top"><p>&#160;</p>
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<td width="100%" valign="top"><p>SIGNATURE MUST BE GUARANTEED BY A MEDALLION SIGNATURE GUARANTY.</p>
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</html>THE
        SECURITIES REPRESENTED BY THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE UNITED
        STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR UNDER THE
        PROVISIONS OF ANY APPLICABLE STATE SECURITIES LAWS, BUT HAVE BEEN ACQUIRED
        BY
        THE REGISTERED HOLDER HEREOF FOR PURPOSES OF INVESTMENT AND IN RELIANCE ON
        STATUTORY EXEMPTIONS UNDER THE 1933 ACT, AND UNDER ANY APPLICABLE STATE
        SECURITIES LAWS. THESE SECURITIES MAY NOT BE SOLD, PLEDGED, TRANSFERRED OR
        ASSIGNED EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER THE PROVISIONS OF
        THE
        1933 ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EFFECTIVE
        REGISTRATION STATEMENT.

       

      

      

      PROMISSORY
        NOTE

      

      Oakdale,
        California

      August
        4,
        2005

      

      FOR
        VALUE
        RECEIVED, ITec Environmental Group, Inc., a Delaware corporation ("Borrower"),
        hereby promises to pay to the order of Capital Growth Equity Fund I, LLC,
        a
        Florida limited liability company ("Lender"),
        in
        lawful money of the United States at the address of Lender set forth herein,
        the
        principal amount of $100,000 (the “Loan”),
        together with Interest. This Promissory Note ("Note")
        has
        been executed by Borrower on the date set forth above (the "Effective
        Date")
        pursuant to the Loan Agreement entered into as of the date hereof between
        Lender
        and Borrower (the "Loan
        Agreement").
        Capitalized terms use but not defined herein shall have the meanings assigned
        to
        such terms in the Loan Agreement.

      

      1.  Interest.
        The
        Loan shall bear interest at the Interest Rate from the Effective Date and
        continuing until payment in full of the Loan. Upon the occurrence of an Event
        of
        Default and for so long as such Event of Default continues, Interest shall
        accrue on the outstanding Loan amount at the Default Interest Rate.

      

      2.  Maturity
        Date.
        Subject
        to Section 3, all or any portion of the Loan, all accrued Interest thereon
        and
        all other sums due hereunder, shall be due and payable on demand by Lender
        on
        the Maturity Date.

      

      3.  Conversion.
        In
        Lender’s discretion, at any time prior to the consummation of the Private
        Placement, Lender may convert all or any portion of the outstanding principal
        amount of this Note into the securities offered by the Company in the Private
        Placement on the same terms as such securities are sold to the other investors
        in the Private Placement. In such event, any accrued by unpaid interest
        outstanding at the time of the conversion of this Note and any outstanding
        principal under this Note not so converted shall be paid in full by the Company
        simultaneously upon such conversion.

      

      4.  Application
        of Payments.
        

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      4.1.  Except
        as
        otherwise expressly provided herein, payments under this Note shall be applied
        (i) first to the repayment of any sums incurred by Lender for the payment
        of any
        expenses in enforcing the terms of this Note, (ii) then to the payment of
        the
        Default Interest Rate, (iii) then to the payment of the Interest Rate, and
        (iv)
        then to the reduction of the Loan.

      

      4.2.  Upon
        payment in full of the Loan and applicable accrued and unpaid Interest thereon,
        this Note shall be marked "Paid in Full" and returned to Borrower.

       

      5.  Waiver
        of Notice.
        Borrower hereby waives diligence, notice, presentment, protest and notice
        of
        dishonor.

      

      6.  Transfer.
        This
        Note may be transferred by Lender at any time, provided that such transfer
        complies with applicable securities laws.

      

      7.  Events
        of Default.
        The
        occurrence of any of following events (each an "Event
        of Default"),
        not
        cured in any applicable cure period, shall constitute an Event of Default
        of
        Borrower:

      

      7.1.  The
        failure to make when due any payment described in this Note or the Loan
        Agreement, whether on or after the Maturity Date, by acceleration or otherwise;
        and

      

      7.2.  A
        breach
        of any representation, warranty, covenant or other provision of this Note
        or the
        Loan Agreement, which, if capable of being cured, is not cured within three
        days
        following notice thereof to the Company;

       

      7.3.  (i)
        The
        application for the appointment of a receiver or custodian for Borrower or
        the
        property of Borrower, (ii) the entry of an order for relief or the filing
        of a
        petition by or against Borrower under the provisions of any bankruptcy or
        insolvency law, (iii) any assignment for the benefit of creditors by or against
        Borrower, or (iv) the insolvency of Borrower.

      

      Upon
        the
        occurrence of any Event of Default that is not cured within any applicable
        cure
        period, if any, Lender may elect, by written notice delivered to Borrower,
        to
        take at any time any or all of the following actions: (i) declare this Note
        to
        be forthwith due and payable, whereupon the entire unpaid Loan, together
        with
        all accrued and unpaid Interest thereon (including the Default Interest Rate),
        and all other cash obligations hereunder, shall become forthwith due and
        payable, without presentment, demand, protest or any other notice of any
        kind,
        all of which are hereby expressly waived by Borrower, anything contained
        herein
        to the contrary notwithstanding, and (ii) exercise any and all other remedies
        provided hereunder or available at law or in equity. 

      

      8.  Miscellaneous.

      

      8.1.  Successors
        and Assigns.
        Subject
        to the exceptions specifically set forth in this Note and the Loan Agreement,
        the terms and conditions of this Note shall inure to the benefit of and be
        binding upon the respective executors, administrators, heirs, successors
        and
        permitted assigns of the parties. This Note (or a portion hereof) may be
        assigned by Lender without the consent of Borrower.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      8.2.  Loss
        or Mutilation of Note.
        Upon
        receipt by Borrower of evidence satisfactory to Borrower of the loss, theft,
        destruction or mutilation of this Note, together with indemnity reasonably
        satisfactory to Borrower, in the case of loss, theft or destruction, or the
        surrender and cancellation of this Note, in the case of mutilation, Borrower
        shall execute and deliver to Lender a new promissory note of like tenor and
        denomination as this Note.

       

      8.3.  Notices.
        Any
        notice, demand, offer, request or other communication required or permitted
        to
        be given pursuant to the terms of this Note shall be in writing and shall
        be
        deemed effectively given the earlier of (i) when received, (ii) when delivered
        personally, (iii) one business day after being delivered by facsimile (with
        receipt of appropriate confirmation), (iv) one business day after being
        deposited with an overnight courier service, or (v) four days after being
        deposited in the U.S. mail, First Class with postage prepaid, and addressed
        to
        the recipient at the addresses set forth below unless another address is
        provided to the other party in writing:

      

      If
        to
        Borrower, to:

      

      ITec
        Environmental Group, Inc.

      5300
        Claus Road, Box 760

      Riverbank,
        CA 95367

      Attn: Gary
        M.
        De Laurentiis

      Fax: (209)
        881-3529

      

      with
        a
        copy to:

      

      The
        Otto
        Law Group, PLLC

      601
        Union
        Street, Suite 4500

      Seattle,
        WA 98101

      Attn:
         David
        M.
        Otto

      Fax: (206)
        262-9513

      

      if
        to
        Lender, to:

      

      Capital
        Growth Equity Fund I, LLC

      225
        NE
        Mizner Blvd. Ste. 750

      Boca
        Raton, FL 33432

      Attn:
         Alan
        Jacobs

      Fax:
         

      

      8.4 Governing
        Law.
        This
        Note shall be governed in all respects by the laws of the State of California
        as
        applied to agreements entered into and performed entirely within the State
        of
        California by residents thereof, without regard to any provisions thereof
        relating to conflicts of laws among different
        jurisdictions.

      

      8.5 Waiver
        and Amendment.
        Any
        term of this Note may be amended, waived or modified only with the written
        consent of Borrower and Lender.

       

      8.6 Remedies;
        Costs of Collection; Attorneys' Fees.
        No
        delay or omission by Lender in exercising any of its rights, remedies, powers
        or
        privileges hereunder or at law or in equity and no course of dealing between
        Lender and the undersigned or any other person shall be deemed a waiver by
        Lender of any such rights, remedies, powers or privileges, even if such delay
        or
        omission is continuous or repeated, nor shall any single or partial exercise
        of
        any right, remedy, power or privilege preclude any other or further exercise
        thereof by Lender or the exercise of any other right, remedy, power or privilege
        by Lender. The rights and remedies of Lender described herein shall be
        cumulative and not restrictive of any other rights or remedies available
        under
        any other instrument, at law or in equity. If an Event of Default occurs,
        Borrower agrees to pay, in addition to the Loan and Interest payable thereon,
        reasonable attorneys' fees and any other reasonable costs incurred by Lender
        in
        connection with its pursuit of its remedies under this Note.

      *
        * * *
        * 

      
        
          
             

          

           

        

        
          3

          
            

          

        

        
           

          
          

        

      

      

      

      IN
        WITNESS WHEREOF, Borrower has caused this Note to be signed on the Effective
        Date.

      

      

      BORROWER:

      

      ITEC
        ENVIRONMENTAL GROUP, INC.

      

      

      By: _______________________________ 

              Gary
        M.
        De Laurentiis 

        Chief
        Executive Officer

       

      

      
        
           

        

        
          4

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