Document:

Exhibit 4.1

                                                                       EXHIBIT A

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE
HAVE  BEEN  REGISTERED  WITH  THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR THE
SECURITIES   COMMISSION  OF  ANY  STATE  IN  RELIANCE  UPON  AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH  EFFECT,  THE  SUBSTANCE  OF WHICH SHALL BE  REASONABLY  ACCEPTABLE  TO THE
COMPANY.  THIS  SECURITY AND THE  SECURITIES  ISSUABLE  UPON  CONVERSION OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION  WITH A BONA FIDE MARGIN  ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.

Original Issue Date: June 13, 2005
Original Conversion Price (subject to adjustment herein): $1.1992

                                                                $
                                                                 ---------------

                           7.5% CONVERTIBLE DEBENTURE
                                DUE JUNE 13, 2008

            THIS  7.5%  CONVERTIBLE  DEBENTURE  is  one  of  a  series  of  duly
authorized and issued 7.5% Convertible  Debentures of Secured Services,  Inc., a
Delaware  corporation,  having a principal  place of  business  at 110  Williams
Street,  14th Floor, New York, NY 10038 (the "COMPANY"),  designated as its 7.5%
Convertible Debenture, due June 13, 2008 (the "DEBENTURE(S)").

         FOR   VALUE    RECEIVED,    the    Company    promises    to   pay   to
________________________ or its registered assigns (the "HOLDER"), or shall have
paid pursuant to the terms hereunder,  the principal sum of  $_______________ by
June 13, 2008, or such earlier date as the  Debentures are required or permitted
to be repaid as provided hereunder (the "MATURITY DATE"), and to pay interest to
the Holder on the aggregate unconverted and then outstanding principal amount of
this  Debenture in accordance  with the  provisions  hereof.  This  Debenture is
subject to the following additional provisions:

         SECTION 1.  DEFINITIONS.  For the purposes  hereof,  in addition to the
terms defined  elsewhere in this Debenture:  (a) capitalized terms not otherwise
defined herein have the meanings given to such terms in the Purchase  Agreement,
and (b) the following terms shall have the following meanings:

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                  "ALTERNATE  CONSIDERATION" shall have the meaning set forth in
         Section 5(d).

                  "BASE  CONVERSION  PRICE"  shall have the meaning set forth in
         Section 5(b).

                  "BUSINESS DAY" means any day except  Saturday,  Sunday and any
         day which shall be a federal  legal  holiday in the United  States or a
         day on  which  banking  institutions  in the  State  of  New  York  are
         authorized or required by law or other government action to close.

                  "BUY-IN" shall have the meaning set forth in Section 4(d)(v).

                  "CHANGE OF CONTROL TRANSACTION" means the occurrence after the
         date  hereof of any of (i) an  acquisition  after the date hereof by an
         individual or legal entity or "group" (as described in Rule 13d-5(b)(1)
         promulgated  under the  Exchange  Act) of  effective  control  (whether
         through legal or beneficial  ownership of capital stock of the Company,
         by contract or otherwise) of in excess of 40% of the voting  securities
         of the Company,  or (ii) the Company merges into or  consolidates  with
         any other Person,  or any Person merges into or  consolidates  with the
         Company and, after giving effect to such transaction,  the stockholders
         of the Company  immediately prior to such transaction own less than 60%
         of the aggregate voting power of the Company or the successor entity of
         such  transaction,  or (iii) the Company sells or transfers its assets,
         as an entirety or substantially  as an entirety,  to another Person and
         the stockholders of the Company  immediately  prior to such transaction
         own less than 60% of the aggregate voting power of the acquiring entity
         immediately  after the  transaction,  (iv) a replacement at one time or
         within a three year period 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 date
         hereof (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 who are
         members on the date hereof),  or (v) the execution by the Company of an
         agreement  to which  the  Company  is a party or by which it is  bound,
         providing for any of the events set forth above in (i) or (iv).

                  "COMMON  STOCK" means the common stock,  par value $0.0001 per
         share,  of the Company and stock of any other class of securities  into
         which such  securities may hereafter have been  reclassified or changed
         into.

                  "CONVERSION  DATE" shall have the meaning set forth in Section
         4(a).

                  "CONVERSION PRICE" shall have the meaning set forth in Section
         4(b).

                  "CONVERSION  SHARES" means the shares of Common Stock issuable
         upon  conversion  of Debentures or as payment of interest in accordance
         with the terms.

                  "DEBENTURE  REGISTER"  shall  have the  meaning  set  forth in
         Section 2(c).

                  "DILUTIVE  ISSUANCE"  shall  have  the  meaning  set  forth in
         Section 5(b).

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                  "DILUTIVE ISSUANCE NOTICE" shall have the meaning set forth in
         Section 5(b).

                  "EFFECTIVENESS  PERIOD"  shall have the meaning  given to such
         term in the Registration Rights Agreement.

                  "EQUITY CONDITIONS" shall mean, during the period in question,
         (i) the Company shall have duly honored all conversions and redemptions
         scheduled  to occur or  occurring  by virtue  of one or more  Notice of
         Conversions  of the Holder,  if any,  (ii) all  liquidated  damages and
         other  amounts owing to the Holder in respect of the  Debentures  shall
         have been paid;  (iii)  there is an  effective  Registration  Statement
         pursuant to which the Holder is  permitted  to utilize  the  prospectus
         thereunder  to  resell  all  of the  shares  issuable  pursuant  to the
         Transaction  Documents (and the Company  believes,  in good faith, that
         such  effectiveness  will continue  uninterrupted  for the  foreseeable
         future), (iv) the Common Stock is trading on the Trading Market and all
         of the shares issuable pursuant to the Transaction Documents are listed
         for  trading on a Trading  Market (and the  Company  believes,  in good
         faith,  that  trading  of the  Common  Stock on a Trading  Market  will
         continue  uninterrupted  for the  foreseeable  future),  (v) there is a
         sufficient  number of authorized but unissued and otherwise  unreserved
         shares of Common Stock for the  issuance of all of the shares  issuable
         pursuant to the Transaction  Documents,  (vi) there is then existing no
         Event of Default or event which, with the passage of time or the giving
         of notice, would constitute an Event of Default,  (vii) the issuance of
         the shares in question to the Holder would not violate the  limitations
         set forth in Section  4(c)(i)  and (viii) no public  announcement  of a
         pending  or  proposed  Fundamental   Transaction,   Change  of  Control
         Transaction or acquisition  transaction  has occurred that has not been
         consummated.

                  "EVENT OF DEFAULT" shall have the meaning set forth in Section
         8.

                  "EXCHANGE ACT" means the  Securities  Exchange Act of 1934, as
         amended, and the rules and regulations promulgated thereunder.

                  "FUNDAMENTAL  TRANSACTION" shall have the meaning set forth in
         Section 5(d).

                  "INTEREST  CONVERSION RATE" means 90% of the lesser of (a) the
         average of the 20 VWAPs  immediately  prior to the applicable  Interest
         Payment  Date or (b) the average of the 20 VWAPs  immediately  prior to
         the  date  the  applicable  interest  payment  shares  are  issued  and
         delivered if after the Interest Payment Date.

                  "INTEREST  PAYMENT  DATE"  shall have the meaning set forth in
         Section 2(a).

                  "LATE FEES" shall have the meaning set forth in Section 2(d).

                  "MANDATORY  PREPAYMENT  AMOUNT" for any Debentures shall equal
         the sum of (i) the  greater  of:  (A) 130% of the  principal  amount of
         Debentures to be prepaid, plus all accrued and unpaid interest thereon,
         or (B) the principal amount of Debentures to be

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         prepaid, plus all other accrued and unpaid interest hereon,  divided by
         the Conversion Price on (x) the date the Mandatory Prepayment Amount is
         demanded  or  otherwise  due or (y) the date the  Mandatory  Prepayment
         Amount is paid in full,  whichever is less,  multiplied  by the VWAP on
         (x) the date the Mandatory  Prepayment  Amount is demanded or otherwise
         due or (y) the date the  Mandatory  Prepayment  Amount is paid in full,
         whichever is greater, and (ii) all other amounts,  costs,  expenses and
         liquidated damages due in respect of such Debentures.

                  "NEW YORK COURTS"  shall have the meaning set forth in Section
         9(d).

                  "NOTICE OF  CONVERSION"  shall have the  meaning  set forth in
         Section 4(a).

                   "ORIGINAL  ISSUE  DATE"  shall  mean  the  date of the  first
         issuance of the Debentures regardless of the number of transfers of any
         Debenture  and  regardless  of the number of  instruments  which may be
         issued to evidence such Debenture.

                  "PERSON" means a corporation,  an association,  a partnership,
         organization,  a business,  an  individual,  a government  or political
         subdivision thereof or a governmental agency.

                  "PURCHASE  AGREEMENT" means the Securities Purchase Agreement,
         dated as of June 13, 2005, 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 the date of the Purchase Agreement, 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"  means  a  registration   statement
         meeting  the  requirements   set  forth  in  the  Registration   Rights
         Agreement,  covering  among other  things the resale of the  Conversion
         Shares and naming the Holder as a "selling stockholder" thereunder.

                  "SECURITIES ACT" means the Securities Act of 1933, as amended,
         and the rules and regulations promulgated thereunder.

                  "SUBSIDIARY"  shall have the meaning given to such term in the
         Purchase Agreement.

                  "TRADING  DAY" means a day on which the Common Stock is traded
         on a Trading Market.

                   "TRADING MARKET" means the following  markets or exchanges on
         which the Common  Stock is listed or quoted for  trading on the date in
         question:  the Nasdaq SmallCap Market, the American Stock Exchange, the
         New York Stock Exchange, the Nasdaq National Market or the OTC Bulletin
         Board.

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                  "TRANSACTION  DOCUMENTS"  shall have the  meaning set forth in
         the Purchase Agreement.

                  "VWAP" 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 a Trading Market, the daily volume weighted average
         price of the Common Stock for such date (or the nearest preceding date)
         on the primary  Trading Market on which the Common Stock is then listed
         or quoted as reported by Bloomberg  Financial L.P.  (based on a Trading
         Day from  9:30  a.m.  EST to 4:02  p.m.  Eastern  Time)  using  the VAP
         function;  (b) if the Common  Stock is not then listed or quoted on the
         Trading  Market and if prices for the Common Stock are then reported in
         the  "Pink  Sheets"  published  by the Pink  Sheets,  LLC (or a similar
         organization  or  agency  succeeding  to  its  functions  of  reporting
         prices),  the most  recent bid price per share of the  Common  Stock so
         reported;  or (c) in all other cases,  the fair market value of a share
         of Common Stock as  determined  by a nationally  recognized-independent
         appraiser  selected in good faith by  Purchasers  holding a majority of
         the Stated Value of the shares of Preferred Stock then outstanding.

         SECTION 2. INTEREST.

                  a) PAYMENT OF INTEREST IN CASH OR KIND.  The Company shall pay
         interest  to  the  Holder  on  the  aggregate   unconverted   and  then
         outstanding  principal amount of this Debenture at the rate of 7.5% per
         annum,  payable  quarterly  on  March  31,  June 30,  September  30 and
         December 31,  beginning on the first such date after the Original Issue
         Date, on each Conversion  Date (as to that principal  amount then being
         converted),  and on the Maturity Date (except that, if any such date is
         not a  Business  Day,  then  such  payment  shall  be due  on the  next
         succeeding  Business Day) (each such date, an "INTEREST PAYMENT DATE"),
         in cash or shares of Common Stock at the Interest Conversion Rate, or a
         combination  thereof;  PROVIDED,  HOWEVER,  payment in shares of Common
         Stock may only occur if during the 20 Trading Days immediately prior to
         the applicable Interest Payment Date and through and including the date
         such shares of Common  Stock are issued to the Holder all of the Equity
         Conditions  have been met and the  Company  shall have given the Holder
         notice in accordance with the notice requirements set forth below.

                  b) COMPANY'S  ELECTION TO PAY INTEREST IN KIND. Subject to the
         terms and  conditions  herein,  the  decision  whether to pay  interest
         hereunder in shares of Common Stock or cash shall be at the  discretion
         of the Company.  Not less than 20 Trading  Days prior to each  Interest
         Payment Date,  the Company shall provide the Holder with written notice
         of its election to pay interest  hereunder  either in cash or shares of
         Common Stock (the Company may indicate in such notice that the election
         contained  in such  notice  shall  continue  for  later  periods  until
         revised). Within 20 Trading Days prior to an Interest Payment Date, the
         Company's  election  (whether  specific to an Interest  Payment Date or
         continuous)  shall be  irrevocable  as to such  Interest  Payment Date.
         Subject to the  aforementioned  conditions,  failure to timely  provide
         such  written  notice shall be deemed an election by the Company to pay
         the interest on such  Interest  Payment  Date in cash.  At

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         any time the Company  delivers a notice to the Holders of its  election
         to pay the interest in shares of Common Stock, the Company shall file a
         prospectus supplement pursuant to Rule 424 disclosing such election.

                  c) INTEREST CALCULATIONS.  Interest shall be calculated on the
         basis of a  360-day  year and  shall  accrue  daily  commencing  on the
         Original  Issue  Date  until  payment  in  full of the  principal  sum,
         together  with all accrued and unpaid  interest and other amounts which
         may become due hereunder,  has been made. Payment of interest in shares
         of Common Stock shall otherwise occur pursuant to Section  4(d)(ii) and
         only for  purposes of the payment of interest in shares,  the  Interest
         Payment Date shall be deemed the Conversion Date.  Interest shall cease
         to accrue with respect to any principal amount converted, provided that
         the Company in fact  delivers  the  Conversion  Shares  within the time
         period required by Section 4(d)(ii). Interest hereunder will be paid to
         the Person in whose name this Debenture is registered on the records of
         the Company  regarding  registration  and transfers of Debentures  (the
         "DEBENTURE  REGISTER").  Except as otherwise provided herein, if at any
         time the Company  pays  interest  partially  in cash and  partially  in
         shares of Common Stock, then such payment shall be distributed  ratably
         among the Holders based upon the principal amount of Debentures held by
         each Holder.

                  d) LATE FEE.  All overdue  accrued  and unpaid  interest to be
         paid hereunder shall entail a late fee at the rate of 18% per annum (or
         such lower  maximum  amount of interest  permitted to be charged  under
         applicable  law) ("LATE FEES") which will accrue  daily,  from the date
         such  interest  is due  hereunder  through  and  including  the date of
         payment.  Notwithstanding anything to the contrary contained herein, if
         on any Interest Payment Date the Company has elected to pay interest in
         Common  Stock and is not able to pay  accrued  interest  in the form of
         Common  Stock  because  it does not then  satisfy  the  conditions  for
         payment  in the form of  Common  Stock set forth  above,  then,  at the
         option of the Holder, the Company,  in lieu of delivering either shares
         of Common  Stock  pursuant  to this  Section 2 or paying the  regularly
         scheduled cash interest  payment,  shall deliver,  within three Trading
         Days of each applicable  Interest Payment Date, an amount in cash equal
         to the  product  of the  number of shares  of  Common  Stock  otherwise
         deliverable  to the Holder in  connection  with the payment of interest
         due on such  Interest  Payment  Date and the  highest  VWAP  during the
         period  commencing  on the  Interest  Payment  Date and  ending  on the
         Trading Day prior to the date such payment is made.

                  e)   PREPAYMENT.   Except  as  otherwise  set  forth  in  this
         Debenture,  the  Company  may not prepay any  portion of the  principal
         amount of this  Debenture  without  the prior  written  consent  of the
         Holder.

         SECTION 3. REGISTRATION OF TRANSFERS AND EXCHANGES.

                  a) DIFFERENT DENOMINATIONS. 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 will be made for such  registration of transfer
         or exchange.

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                  b) INVESTMENT REPRESENTATIONS.  This Debenture has been issued
         subject to certain  investment  representations  of the original Holder
         set forth in the Purchase Agreement and may be transferred or exchanged
         only in compliance with the Purchase  Agreement and applicable  federal
         and state securities laws and regulations.

                  c) RELIANCE ON DEBENTURE REGISTER. Prior to due presentment to
         the Company for transfer of this  Debenture,  the Company and any agent
         of the  Company  may treat the Person in whose name this  Debenture  is
         duly  registered on the Debenture  Register as the owner hereof for the
         purpose  of  receiving  payment  as herein  provided  and for all other
         purposes,  whether or not this  Debenture  is overdue,  and neither the
         Company nor any such agent shall be affected by notice to the contrary.

         SECTION 4. CONVERSION.

                  a) VOLUNTARY CONVERSION.  At any time after the Original Issue
         Date until this  Debenture  is no longer  outstanding,  this  Debenture
         shall be  convertible  into shares of Common Stock at the option of the
         Holder,  in whole or in part at any time and from time to time (subject
         to the limitations on conversion set forth in Section 4(c) hereof). The
         Holder shall effect  conversions  by delivering to the Company the form
         of Notice  of  Conversion  attached  hereto  as ANNEX A (a  "NOTICE  OF
         CONVERSION"),  specifying therein the principal amount of Debentures to
         be converted and the date on which such conversion is to be effected (a
         "CONVERSION  DATE").  If no Conversion Date is specified in a Notice of
         Conversion,  the Conversion  Date shall be the date that such Notice of
         Conversion is provided hereunder. To effect conversions hereunder,  the
         Holder shall not be required to physically  surrender Debentures to the
         Company unless the entire  principal  amount of this Debenture plus all
         accrued and unpaid interest thereon has been so converted.  Conversions
         hereunder shall have the effect of lowering the  outstanding  principal
         amount  of  this  Debenture  in  an  amount  equal  to  the  applicable
         conversion.  The Holder and the Company shall maintain  records showing
         the principal  amount converted and the date of such  conversions.  The
         Company shall deliver any objection to any Notice of Conversion  within
         1 Business Day of receipt of such  notice.  In the event of any dispute
         or  discrepancy,  the records of the Holder  shall be  controlling  and
         determinative  in the  absence of  manifest  error.  The Holder and any
         assignee, by acceptance of this Debenture,  acknowledge and agree that,
         by reason of the provisions of this paragraph,  following conversion of
         a portion  of this  Debenture,  the unpaid  and  unconverted  principal
         amount of this Debenture may be less than the amount stated on the face
         hereof.

                  b) CONVERSION  PRICE.  The  conversion  price in effect on any
         Conversion  Date  shall be  equal to  $1.1992  (subject  to  adjustment
         herein)(the "CONVERSION PRICE").

                  c)       CONVERSION LIMITATIONS.

                           i. RESERVED.

                           ii. HOLDER'S  RESTRICTION ON CONVERSION.  The Company
                  shall not effect any  conversion  of this  Debenture,  and the
                  Holder shall not have the right to

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                  convert  any  portion of this  Debenture,  pursuant to Section
                  4(a) or  otherwise,  to the extent that after giving effect to
                  such  conversion,  the  Holder  (together  with  the  Holder's
                  affiliates),   as  set  forth  on  the  applicable  Notice  of
                  Conversion,  would  beneficially own in excess of 4.99% of the
                  number of shares of the 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,  nonconverted
                  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  the  Warrants)  subject  to  a  limitation  on
                  conversion or exercise  analogous to the limitation  contained
                  herein  beneficially  owned  by  the  Holder  or  any  of  its
                  affiliates. Except as set forth in the preceding sentence, for
                  purposes of this Section 4(c)(ii),  beneficial ownership shall
                  be calculated in accordance with Section 13(d) of the Exchange
                  Act.  To the  extent  that the  limitation  contained  in this
                  section applies,  the  determination of whether this Debenture
                  is convertible (in relation to other  securities  owned by the
                  Holder)  and  of  which  a  portion  of  this   Debenture   is
                  convertible shall be in the sole discretion of such Holder. To
                  ensure  compliance with this  restriction,  the Holder will be
                  deemed to  represent  to the  Company  each time it delivers a
                  Notice of Conversion  that such Notice of  Conversion  has not
                  violated the  restrictions set forth in this paragraph and the
                  Company  shall have no  obligation  to verify or  confirm  the
                  accuracy of such  determination.  For purposes of this Section
                  4(c)(ii),  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-QSB or Form  10-KSB,  as the case may be, (y) a
                  more  recent  public  announcement  by the  Company or (z) any
                  other notice by the Company or the  Company's  Transfer  Agent
                  setting   forth  the   number   of  shares  of  Common   Stock
                  outstanding.  Upon the written or oral  request of the Holder,
                  the Company  shall within two Trading 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,  by the  Holder or its  affiliates
                  since the date as of which such number of  outstanding  shares
                  of Common Stock was reported.  The  provisions of this Section
                  4(c) may be  waived  by the  Holder,  at the  election  of the
                  Holder,  upon  not  less  than 61 days'  prior  notice  to the
                  Company,  and  the  provisions  of  this  Section  4(c)  shall
                  continue to apply until such 61st day (or such later date,  as
                  determined  by the Holder,  as may be specified in such notice
                  of waiver).

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                  d)       MECHANICS OF CONVERSION

                           i.  CONVERSION  SHARES  ISSUABLE  UPON  CONVERSION OF
                  PRINCIPAL  AMOUNT.  The  number  of  shares  of  Common  Stock
                  issuable  upon a conversion  hereunder  shall be determined by
                  the  quotient   obtained  by  dividing  (x)  the   outstanding
                  principal  amount of this Debenture to be converted by (y) the
                  Conversion Price.

                           ii.  DELIVERY OF  CERTIFICATE  UPON  CONVERSION.  Not
                  later than three Trading Days after any  Conversion  Date, the
                  Company  will  deliver or cause to be  delivered to the Holder
                  (A) a certificate or certificates  representing the Conversion
                  Shares which shall be free of restrictive  legends and trading
                  restrictions  (other  than  those  required  by  the  Purchase
                  Agreement)  representing  the number of shares of Common Stock
                  being acquired upon the  conversion of Debentures  (including,
                  if so timely  elected by the  Company,  shares of Common Stock
                  representing  the payment of accrued  interest) and (B) a bank
                  check in the amount of accrued  and  unpaid  interest  (if the
                  Company is  required to pay  accrued  interest  in cash).  The
                  Company  shall,  if available and if allowed under  applicable
                  securities   laws,   use  its  best  efforts  to  deliver  any
                  certificate  or  certificates  required to be delivered by the
                  Company   under  this  Section   electronically   through  the
                  Depository Trust Corporation or another  established  clearing
                  corporation performing similar functions.

                           iii. FAILURE TO DELIVER CERTIFICATES.  If in the case
                  of any Notice of Conversion  such  certificate or certificates
                  are not delivered to or as directed by the  applicable  Holder
                  by the fifth Trading Day after a Conversion  Date,  the Holder
                  shall be entitled by written notice to the Company at any time
                  on or before its receipt of such  certificate or  certificates
                  thereafter,  to rescind  such  conversion,  in which event the
                  Company shall immediately return the certificates representing
                  the principal amount of Debentures tendered for conversion.

                           iv. OBLIGATION ABSOLUTE;  PARTIAL LIQUIDATED DAMAGES.
                  If the  Company  fails for any reason to deliver to the Holder
                  such certificate or certificates  pursuant to Section 4(d)(ii)
                  by the  third  Trading  Day  after the  Conversion  Date,  the
                  Company  shall  pay to such  Holder,  in cash,  as  liquidated
                  damages  and not as a  penalty,  for each  $2000 of  principal
                  amount being converted, $10 per Trading Day (increasing to $20
                  per Trading Day after 5 Trading Days after such damages  begin
                  to accrue) for each  Trading Day after such fifth  Trading Day
                  until  such   certificates   are   delivered.   The  Company's
                  obligations  to issue and deliver the  Conversion  Shares upon
                  conversion  of this  Debenture  in  accordance  with the terms
                  hereof 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

                                       9
<PAGE>

                  with  the  issuance  of  such  Conversion  Shares;   PROVIDED,
                  HOWEVER,  such  delivery  shall not operate as a waiver by the
                  Company of any such action the  Company  may have  against the
                  Holder. In the event a Holder of this Debenture shall elect to
                  convert any or all of the outstanding principal amount hereof,
                  the Company may not refuse  conversion based on any claim that
                  the Holder or any one associated or affiliated with the Holder
                  has been engaged in any violation of law, agreement or for any
                  other reason,  unless,  an injunction from a court, on notice,
                  restraining and or enjoining conversion of all or part of this
                  Debenture  shall have been sought and obtained and the Company
                  posts a  surety  bond for the  benefit  of the  Holder  in the
                  amount  of  150% of the  principal  amount  of this  Debenture
                  outstanding,  which is subject to the  injunction,  which bond
                  shall   remain   in   effect   until   the    completion    of
                  arbitration/litigation  of the  dispute  and the  proceeds  of
                  which shall be payable to such Holder to the extent it obtains
                  judgment. In the absence of an injunction precluding the same,
                  the Company shall issue  Conversion  Shares or, if applicable,
                  cash, upon a properly noticed conversion. Nothing herein shall
                  limit a Holder's  right to pursue actual damages or declare an
                  Event  of  Default  pursuant  to  Section  8  herein  for  the
                  Company's  failure to  deliver  Conversion  Shares  within the
                  period  specified  herein and such Holder shall have the right
                  to pursue  all  remedies  available  to it at law or in equity
                  including,   without   limitation,   a  decree   of   specific
                  performance and/or injunctive relief. The exercise of any such
                  rights  shall not  prohibit the Holder from seeking to enforce
                  damages   pursuant  to  any  other  Section  hereof  or  under
                  applicable law.

                           v.  COMPENSATION  FOR  BUY-IN  ON  FAILURE  TO TIMELY
                  DELIVER CERTIFICATES UPON CONVERSION. In addition to any other
                  rights  available to the Holder,  if the Company fails for any
                  reason  to  deliver  to  the  Holder   such   certificate   or
                  certificates pursuant to Section 4(d)(ii) by the fifth Trading
                  Day after the Conversion Date, and if after such fifth Trading
                  Day the Holder is required by its  brokerage  firm to purchase
                  (in an open market  transaction or otherwise)  Common Stock to
                  deliver  in  satisfaction  of a sale  by  such  Holder  of the
                  Conversion Shares which the Holder anticipated  receiving upon
                  such  conversion (a "BUY-IN"),  then the Company shall (A) pay
                  in cash to the Holder (in addition to any  remedies  available
                  to or  elected  by the  Holder)  the  amount  by which (x) the
                  Holder's   total   purchase   price    (including    brokerage
                  commissions, if any) for the Common Stock so purchased exceeds
                  (y) the  product  of (1) the  aggregate  number  of  shares of
                  Common Stock that such Holder  anticipated  receiving from the
                  conversion at issue multiplied by (2) the actual sale price of
                  the Common Stock at the time of the sale (including  brokerage
                  commissions,  if any) giving rise to such purchase  obligation
                  and (B) at the option of the Holder, either reissue Debentures
                  in  principal  amount  equal to the  principal  amount  of the
                  attempted  conversion  or  deliver to the Holder the number of
                  shares of Common  Stock that  would  have been  issued had the
                  Company timely complied with its delivery  requirements  under
                  Section 4(d)(ii).  For example, if the Holder purchases Common
                  Stock  having a total  purchase  price of  $11,000  to cover a
                  Buy-In with respect to an attempted  conversion  of Debentures
                  with respect to which the actual sale price of

                                       10
<PAGE>

                  the  Conversion  Shares  at the  time of the  sale  (including
                  brokerage  commissions,  if any) giving rise to such  purchase
                  obligation  was a total of  $10,000  under  clause  (A) of the
                  immediately preceding sentence,  the Company shall be required
                  to pay the Holder $1,000. The Holder shall provide the Company
                  written notice indicating the amounts payable to the Holder in
                  respect  of the  Buy-In.  Notwithstanding  anything  contained
                  herein to the  contrary,  if a Holder  requires the Company to
                  make  payment in respect of a Buy-In for the failure to timely
                  deliver certificates  hereunder and the Company timely pays in
                  full such  payment,  the Company  shall not be required to pay
                  such  Holder  liquidated  damages  under  Section  4(d)(iv) in
                  respect of the certificates resulting in such Buy-In.

                           vi.  RESERVATION OF SHARES ISSUABLE UPON  CONVERSION.
                  The Company  covenants  that it will at all times  reserve and
                  keep available out of its  authorized  and unissued  shares of
                  Common  Stock   solely  for  the  purpose  of  issuance   upon
                  conversion  of the  Debentures  and payment of interest on the
                  Debenture,  each as  herein  provided,  free  from  preemptive
                  rights  or any  other  actual  contingent  purchase  rights of
                  persons  other than the Holder  (and the other  Holders of the
                  Debentures), not less than such number of shares of the Common
                  Stock as shall (subject to any additional  requirements of the
                  Company  as to  reservation  of such  shares  set forth in the
                  Purchase  Agreement)  be  issuable  (taking  into  account the
                  adjustments and restrictions of Section 5) upon the conversion
                  of the  outstanding  principal  amount of the  Debentures  and
                  payment of interest hereunder.  The Company covenants that all
                  shares of Common Stock that shall be so issuable  shall,  upon
                  issue, be duly and validly authorized,  issued and fully paid,
                  nonassessable  and,  if the  Registration  Statement  is  then
                  effective under the Securities Act, registered for public sale
                  in accordance with such Registration Statement.

                           vii. FRACTIONAL SHARES.  Upon a conversion  hereunder
                  the Company shall not be required to issue stock  certificates
                  representing  fractions of shares of the Common Stock, but may
                  if otherwise permitted,  make a cash payment in respect of any
                  final  fraction of a share based on the VWAP at such time.  If
                  the  Company  elects  not,  or is unable,  to make such a cash
                  payment,  the Holder shall be entitled to receive,  in lieu of
                  the  final  fraction  of a share,  one  whole  share of Common
                  Stock.

                           viii.  TRANSFER  TAXES.  The issuance of certificates
                  for shares of the Common Stock on conversion of this Debenture
                  shall be made  without  charge to the  Holder  hereof  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
                  and the Company shall not be required to issue or deliver such
                  certificates  unless or until the person or persons requesting
                  the issuance thereof shall have paid to the

                                       11
<PAGE>

                  Company  the amount of such tax or shall have  established  to
                  the satisfaction of the Company that such tax has been paid.

         SECTION 5. CERTAIN ADJUSTMENTS.

                  a) STOCK  DIVIDENDS AND STOCK SPLITS.  If the Company,  at any
         time while this Debenture is outstanding:  (A) pays a stock dividend or
         otherwise make a distribution or  distributions on shares of its Common
         Stock or any other equity or equity  equivalent  securities  payable in
         shares  of Common  Stock  (which,  for  avoidance  of doubt,  shall not
         include any shares of Common  Stock  issued by the Company  pursuant to
         this  Debenture,   including  as  interest  thereon),   (B)  subdivides
         outstanding  shares of Common Stock into a larger number of shares, (C)
         combines  (including by way of reverse stock split)  outstanding shares
         of Common  Stock  into a smaller  number of  shares,  or (D)  issues by
         reclassification  of shares of the  Common  Stock any shares of capital
         stock of the Company,  then the Conversion Price shall be multiplied by
         a  fraction  of which the  numerator  shall be the  number of shares of
         Common  Stock   (excluding   treasury   shares,   if  any)  outstanding
         immediately before such event and of which the denominator shall be the
         number of shares of Common  Stock  outstanding  immediately  after such
         event.  Any  adjustment  made  pursuant to this  Section  shall  become
         effective  immediately  after the record date for the  determination of
         stockholders  entitled to receive  such  dividend or  distribution  and
         shall become effective immediately after the effective date in the case
         of a subdivision, combination or re-classification.

                  b) SUBSEQUENT  EQUITY SALES.  If the Company or any Subsidiary
         thereof,   as   applicable,   at  any  time  while  this  Debenture  is
         outstanding,  shall offer, sell, grant any option to purchase or offer,
         sell or grant any right to reprice its securities, or otherwise dispose
         of or issue  (or  announce  any  offer,  sale,  grant or any  option to
         purchase  or  other  disposition)  any  Common  Stock or  Common  Stock
         Equivalents  entitling any Person to acquire shares of Common Stock, at
         an effective price per share less than the then Conversion  Price (such
         lower  price,   the  "BASE   CONVERSION   PRICE"  and  such   issuances
         collectively,  a "DILUTIVE  ISSUANCE"),  as adjusted  hereunder (if the
         holder of the Common Stock or Common Stock  Equivalents so issued shall
         at any time, whether by operation of purchase price adjustments,  reset
         provisions,   floating  conversion,  exercise  or  exchange  prices  or
         otherwise,  or due to  warrants,  options or rights per share  which is
         issued in connection with such issuance,  be entitled to receive shares
         of Common Stock at an effective  price per share which is less than the
         Conversion  Price,  such issuance  shall be deemed to have occurred for
         less than the Conversion Price on such date of the Dilutive  Issuance),
         then the Conversion Price shall be reduced to equal the Base Conversion
         Price.  Such  adjustment  shall be made  whenever  such Common Stock or
         Common Stock Equivalents are issued.  Notwithstanding the foregoing, no
         adjustment will be made under this Section 5(b) in respect of an Exempt
         Issuance. The Company shall notify the Holder in writing, no later than
         the Business Day  following  the issuance of any Common Stock or Common
         Stock  Equivalents  subject to this  section,  indicating  therein  the
         applicable  issuance  price,  or of  applicable  reset price,  exchange
         price,  conversion  price and other  pricing  terms  (such  notice  the
         "DILUTIVE ISSUANCE NOTICE"). For purposes of

                                       12
<PAGE>

         clarification,  whether or not the Company provides a Dilutive Issuance
         Notice  pursuant  to this  Section  5(b),  upon the  occurrence  of any
         Dilutive Issuance,  after the date of such Dilutive Issuance the Holder
         is entitled  to receive a number of  Conversion  Shares  based upon the
         Base  Conversion  Price  regardless  of whether  the Holder  accurately
         refers to the Base Conversion Price in the Notice of Conversion.

                  c) PRO RATA  DISTRIBUTIONS.  If the Company, at any time while
         Debentures are  outstanding,  shall distribute to all holders of Common
         Stock (and not to  Holders)  evidences  of its  indebtedness  or assets
         (including  cash and cash dividends) or rights or warrants to subscribe
         for or purchase  any  security,  then in each such case the  Conversion
         Price shall be adjusted by multiplying  such Conversion Price in effect
         immediately  prior  to the  record  date  fixed  for  determination  of
         stockholders  entitled to receive  such  distribution  by a fraction of
         which the  denominator  shall be the VWAP  determined  as of the record
         date mentioned  above, and of which the numerator shall be such VWAP on
         such record date less the then fair market value at such record date of
         the portion of such assets or evidence of  indebtedness  so distributed
         applicable to one  outstanding  share of the Common Stock as determined
         by the Board of Directors in good faith. In either case the adjustments
         shall be described in a statement provided to the Holder of the portion
         of  assets  or  evidences  of   indebtedness  so  distributed  or  such
         subscription  rights  applicable  to one  share of Common  Stock.  Such
         adjustment  shall be made  whenever any such  distribution  is made and
         shall  become  effective  immediately  after the record date  mentioned
         above.

                  d)  FUNDAMENTAL  TRANSACTION.  If,  at  any  time  while  this
         Debenture  is  outstanding,  (A) the  Company  effects  any  merger  or
         consolidation  of the  Company  with or into  another  Person,  (B) the
         Company effects any sale of all or  substantially  all of its assets in
         one or a  series  of  related  transactions,  (C) any  tender  offer or
         exchange offer (whether by the Company or another  Person) is completed
         pursuant to which  holders of Common  Stock are  permitted to tender or
         exchange their shares for other  securities,  cash or property,  or (D)
         the Company  effects any  reclassification  of the Common  Stock or any
         compulsory  share  exchange  pursuant  to  which  the  Common  Stock is
         effectively  converted into or exchanged for other securities,  cash or
         property (in any such case, a "FUNDAMENTAL TRANSACTION"), then upon any
         subsequent  conversion  of this  Debenture,  the Holder  shall have the
         right to  receive,  for each  Conversion  Share  that  would  have been
         issuable upon such  conversion  immediately  prior to the occurrence of
         such Fundamental  Transaction,  the same kind and amount of securities,
         cash or  property as it would have been  entitled  to receive  upon the
         occurrence of such Fundamental  Transaction if it had been, immediately
         prior to such  Fundamental  Transaction,  the  holder  of one  share of
         Common Stock (the "ALTERNATE CONSIDERATION").  For purposes of any such
         conversion,   the  determination  of  the  Conversion  Price  shall  be
         appropriately  adjusted to apply to such Alternate  Consideration based
         on the amount of  Alternate  Consideration  issuable  in respect of one
         share of Common Stock in such Fundamental Transaction,  and the Company
         shall apportion the Conversion Price among the Alternate  Consideration
         in a reasonable  manner  reflecting the relative value of any different
         components of the Alternate  Consideration.  If holders of Common Stock
         are given any choice as to the

                                       13
<PAGE>

         securities,   cash  or  property  to  be  received  in  a   Fundamental
         Transaction,  then the Holder  shall be given the same choice as to the
         Alternate  Consideration  it  receives  upon  any  conversion  of  this
         Debenture  following  such  Fundamental  Transaction.   To  the  extent
         necessary to effectuate the foregoing provisions,  any successor to the
         Company or surviving entity in such Fundamental Transaction shall issue
         to the Holder a new debenture  consistent with the foregoing provisions
         and  evidencing  the  Holder's  right to convert  such  debenture  into
         Alternate Consideration. The terms of any agreement pursuant to which a
         Fundamental  Transaction is effected shall include terms  requiring any
         such  successor or surviving  entity to comply with the  provisions  of
         this  paragraph  (d) and  insuring  that  this  Debenture  (or any such
         replacement  security)  will be similarly  adjusted upon any subsequent
         transaction analogous to a Fundamental Transaction.

                  e) CALCULATIONS.  All calculations  under this Section 5 shall
         be made to the nearest cent or the nearest  1/100th of a share,  as the
         case may be. For  purposes  of this  Section 5, the number of shares of
         Common  Stock  deemed to be issued and  outstanding  as of a given date
         shall be the sum of the  number of shares  of Common  Stock  (excluding
         treasury shares, if any) issued and outstanding.

                  f)       NOTICE TO HOLDERS.

                           i.  ADJUSTMENT  TO  CONVERSION  PRICE.  Whenever  the
                  Conversion  Price is adjusted  pursuant to any of this Section
                  5, 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.  If the Company  issues a variable rate  security,
                  despite the prohibition thereon in the Purchase Agreement, the
                  Company  shall be deemed to have issued Common Stock or Common
                  Stock  Equivalents  at  the  lowest  possible   conversion  or
                  exercise  price at which such  securities  may be converted or
                  exercised  in the  case of a  Variable  Rate  Transaction  (as
                  defined in the Purchase Agreement).

                           ii. NOTICE TO ALLOW CONVERSION BY HOLDER.  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 the Common  Stock  rights or warrants to  subscribe
                  for or purchase any shares of capital stock of any class or of
                  any  rights;  (D)  the  approval  of any  stockholders  of the
                  Company   shall   be   required   in   connection   with   any
                  reclassification  of the Common Stock,  any  consolidation  or
                  merger to which the  Company is a party,  any sale or transfer
                  of all or substantially  all of the assets of the Company,  of
                  any  compulsory  share  exchange  whereby the Common  Stock is
                  converted  into other  securities,  cash or property;  (E) the
                  Company  shall   authorize   the   voluntary  or   involuntary
                  dissolution,  liquidation  or winding up of the affairs of the
                  Company;  then,  in each case,  the Company  shall cause to be
                  filed at each office or agency  maintained  for the purpose of
                  conversion of the Debentures,  and shall cause to be mailed to
                  the Holders at their last  addresses as they shall appear upon
                  the stock

                                       14
<PAGE>

                  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 the 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  such  reclassification,  consolidation,  merger,  sale,
                  transfer or share exchange is expected to become  effective or
                  close, and the date as of which it is expected that holders of
                  the Common Stock of record shall be entitled to exchange their
                  shares  of the  Common  Stock  for  securities,  cash or other
                  property     deliverable    upon    such     reclassification,
                  consolidation,  merger,  sale,  transfer  or  share  exchange;
                  PROVIDED,  that the  failure to mail such notice or any defect
                  therein  or in  the  mailing  thereof  shall  not  affect  the
                  validity of the corporate  action  required to be specified in
                  such notice. Holders are entitled to convert Debentures during
                  the 20-day  period  commencing  the date of such notice to the
                  effective date of the event triggering such notice.

         SECTION 6. RESERVED.

         SECTION 7. NEGATIVE COVENANTS. So long as any portion of this Debenture
is outstanding, the Company will not and will not permit any of its Subsidiaries
to directly or indirectly:

                  a) enter into, create,  incur, assume,  guarantee or suffer to
         exist any  indebtedness  for borrowed money of any kind,  including but
         not limited to, a guarantee,  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 to, or PARI PASSU with,
         in any respect, the Company's obligations hereunder;

                  b) enter into,  create,  incur,  assume or suffer to exist any
         liens 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 to or PARI  PASSU  with,  in any
         respect, the Company's obligations hereunder;

                  c) amend its  certificate  of  incorporation,  bylaws or other
         charter documents so as to adversely affect any rights of the Holder;

                  d)  repay,   repurchase  or  offer  to  repay,  repurchase  or
         otherwise acquire more than a DE MINIMIS number of shares of its Common
         Stock or  Common  Stock  Equivalents  other  than as to the  Conversion
         Shares to the  extent  permitted  or  required  under  the  Transaction
         Documents or as otherwise permitted by the Transaction Documents;

                  e)  enter  into  any  agreement  with  respect  to  any of the
         foregoing; or

                  f) pay cash dividends on any equity securities of the Company.

                                       15
<PAGE>

         SECTION 8. EVENTS OF DEFAULT.

                  a) "EVENT OF DEFAULT",  wherever used herein, means 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 (A) the  principal
                  amount of any Debenture, or (B) interest (including Late Fees)
                  on, or liquidated damages in respect of, any Debenture, as and
                  when the same  shall  become  due and  payable  (whether  on a
                  Conversion  Date or the Maturity  Date or by  acceleration  or
                  otherwise)  which  default,  solely in the case of an interest
                  payment or other default under clause (B) above, is not cured,
                  within 3 Trading Days;

                           ii. the Company  shall fail to observe or perform any
                  other covenant or agreement contained in this Debenture (other
                  than a breach by the  Company  of its  obligations  to deliver
                  shares of Common  Stock to the Holder  upon  conversion  which
                  breach is addressed in clause (xi) below) which failure is not
                  cured, if possible to cure, within the earlier to occur of (A)
                  5 Trading Days after notice of such default sent by the Holder
                  or by any  other  Holder  and  (B)10  Trading  Days  after the
                  Company  shall  become or  should  have  become  aware of such
                  failure;

                           iii. a default or event of  default  (subject  to any
                  grace or cure period provided for in the applicable agreement,
                  document  or  instrument)  shall  occur  under  (A) any of the
                  Transaction  Documents other than the  Debentures,  or (B) any
                  other  material  agreement,  lease,  document or instrument to
                  which the Company or any Subsidiary is bound;

                           iv. any  representation  or warranty made herein,  in
                  any other  Transaction  Documents,  in any  written  statement
                  pursuant hereto or thereto, or in any other report,  financial
                  statement  or  certificate  made or delivered to the Holder or
                  any other holder of Debentures shall be untrue or incorrect in
                  any material respect as of the date when made or deemed made;

                           v. (i) the Company or any of its  Subsidiaries  shall
                  commence,  or there shall be commenced  against the Company or
                  any such Subsidiary, a case under any applicable bankruptcy or
                  insolvency laws as now or hereafter in effect or any successor
                  thereto, or the Company or any Subsidiary  commences any other
                  proceeding under any reorganization,  arrangement,  adjustment
                  of  debt,  relief  of  debtors,  dissolution,   insolvency  or
                  liquidation or similar law of any jurisdiction  whether now or
                  hereafter in effect  relating to the Company or any Subsidiary
                  thereof or (ii) there is commenced  against the Company or any
                  Subsidiary  thereof any such  bankruptcy,  insolvency or other
                  proceeding which remains  undismissed for a period of 60 days;
                  or (iii) the Company or any Subsidiary  thereof is adjudicated
                  by a court of competent jurisdiction insolvent or bankrupt; or
                  any

                                       16
<PAGE>

                  order of  relief  or other  order  approving  any such case or
                  proceeding is entered;  or (iv) the Company or any  Subsidiary
                  thereof  suffers any  appointment of any custodian or the like
                  for it or any substantial part of its property which continues
                  undischarged  or unstayed for a period of 60 days;  or (v) the
                  Company or any Subsidiary  thereof makes a general  assignment
                  for the benefit of  creditors;  or (vi) the Company shall fail
                  to pay,  or shall  state that it is unable to pay, or shall be
                  unable to pay,  its debts  generally  as they  become  due; or
                  (vii) the  Company  or any  Subsidiary  thereof  shall  call a
                  meeting  of  its   creditors   with  a  view  to  arranging  a
                  composition,  adjustment  or  restructuring  of its debts;  or
                  (viii) the Company or any Subsidiary  thereof shall by any act
                  or failure to act expressly  indicate its consent to, approval
                  of or  acquiescence  in any  of the  foregoing;  or  (ix)  any
                  corporate  or other  action  is taken  by the  Company  or any
                  Subsidiary  thereof  for the purpose of  effecting  any of the
                  foregoing;

                           vi. the Company or any  Subsidiary  shall  default in
                  any of its obligations under any mortgage, credit agreement or
                  other facility,  indenture  agreement,  factoring agreement or
                  other instrument 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 in an amount  exceeding
                  $150,000,  whether  such  indebtedness  now  exists  or  shall
                  hereafter  be created and such  default  shall  result in such
                  indebtedness  becoming or being declared due and payable prior
                  to the  date  on  which  it  would  otherwise  become  due and
                  payable;

                           vii.  the  Common  Stock  shall not be  eligible  for
                  quotation  on or quoted for  trading  on a Trading  Market and
                  shall  not again be  eligible  for and  quoted  or listed  for
                  trading thereon within five Trading Days;

                           viii.  the Company  shall be a party to any Change of
                  Control Transaction or Fundamental Transaction, shall agree to
                  sell or  dispose  of all or in excess of 40% of its  assets in
                  one or more  transactions  (whether  or not  such  sale  would
                  constitute a Change of Control Transaction) or shall redeem or
                  repurchase  more than a de minimis  number of its  outstanding
                  shares  of  Common  Stock or other  equity  securities  of the
                  Company  (other  than  redemptions  of  Conversion  Shares and
                  repurchases   of  shares  of  Common  Stock  or  other  equity
                  securities of departing officers and directors of the Company;
                  provided such repurchases  shall not exceed  $100,000,  in the
                  aggregate,  for all officers and directors  during the term of
                  this Debenture);

                           ix. a  Registration  Statement  shall  not have  been
                  declared  effective by the Commission on or prior to the 180th
                  calendar day after the Closing Date;

                           x. if, during the Effectiveness Period (as defined in
                  the Registration  Rights Agreement),  the effectiveness of the
                  Registration  Statement  lapses  for any  reason or the Holder
                  shall not be permitted to resell Registrable Securities (as

                                       17
<PAGE>

                  defined  in  the  Registration  Rights  Agreement)  under  the
                  Registration  Statement,  in  either  case,  for more  than 10
                  consecutive  Trading Days or 15  non-consecutive  Trading Days
                  during any 12 month  period;  PROVIDED,  HOWEVER,  that in the
                  event that the Company is negotiating a merger, consolidation,
                  acquisition or sale of all or substantially  all of its assets
                  or a similar transaction and in the written opinion of counsel
                  to the Company, the Registration Statement,  would be required
                  to  be  amended  to  include   information   concerning   such
                  transactions  or the parties  thereto that is not available or
                  may not be publicly  disclosed at the time,  the Company shall
                  be permitted an additional 10 consecutive  Trading Days during
                  any 12 month period relating to such an event;

                           xi. the Company  shall fail for any reason to deliver
                  certificates  to a Holder prior to the tenth Trading Day after
                  a Conversion  Date pursuant to and in accordance  with Section
                  4(d)  or the  Company  shall  provide  notice  to the  Holder,
                  including by way of public  announcement,  at any time, of its
                  intention not to comply with requests for  conversions  of any
                  Debentures in accordance with the terms hereof.

                  b)  REMEDIES  UPON EVENT OF  DEFAULT.  If any Event of Default
         occurs,  the full  principal  amount of this  Debenture,  together with
         interest and other  amounts  owing in respect  thereof,  to the date of
         acceleration  shall become, at the Holder's  election,  immediately due
         and payable in cash.  The  aggregate  amount  payable  upon an Event of
         Default shall be equal to the Mandatory Prepayment Amount. Commencing 5
         days after the  occurrence  of any Event of Default that results in the
         eventual  acceleration  of this  Debenture,  the interest  rate on this
         Debenture  shall  accrue at the rate of 18% per  annum,  or such  lower
         maximum  amount of interest  permitted to be charged  under  applicable
         law. All  Debentures  for which the full  Mandatory  Prepayment  Amount
         hereunder shall have been paid in accordance herewith shall promptly be
         surrendered  to or as  directed  by the  Company.  The Holder  need not
         provide and the Company hereby waives any presentment,  demand, protest
         or other notice of any kind, and the Holder may immediately and without
         expiration  of any grace  period  enforce any and all of its rights and
         remedies  hereunder  and  all  other  remedies  available  to it  under
         applicable  law.  Such  declaration  may be  rescinded  and annulled by
         Holder at any time prior to payment hereunder and the Holder shall have
         all rights as a Debenture  holder until such time,  if any, as the full
         payment  under this  Section  shall have been  received  by it. No such
         rescission or annulment shall affect any subsequent Event of Default or
         impair any right consequent thereon.

         SECTION 9. MISCELLANEOUS.

                  a)  NOTICES.  Any and all notices or other  communications  or
         deliveries to be provided by the Holder hereunder,  including,  without
         limitation, any Notice of Conversion, shall be in writing and delivered
         personally,  by facsimile,  sent by a nationally  recognized  overnight
         courier  service,  addressed to the  Company,  at the address set forth
         above,  facsimile number 888.445.4467,  ATTN: KING T. MOORE,  PRESIDENT
         AND

                                       18
<PAGE>

         CHIEF  EXECUTIVE  OFFICER or such other address or facsimile  number as
         the  Company  may  specify  for such  purposes by notice to the Holders
         delivered in accordance with this Section. 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,  sent by a
         nationally  recognized  overnight  courier  service  addressed  to each
         Holder at the  facsimile  telephone  number or address  of such  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  prior to 5:30 p.m.  (New York City time),  (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  later  than  5:30 p.m.  (New  York City  time) on any date and
         earlier  than 11:59 p.m.  (New York City time) on such date,  (iii) the
         second  Business  Day  following  the  date  of  mailing,  if  sent  by
         nationally  recognized  overnight courier service,  or (iv) upon actual
         receipt by the party to whom such notice is required to be given.

                  b) ABSOLUTE  OBLIGATION.  Except as expressly provided herein,
         no provision of this Debenture  shall alter or impair the obligation of
         the Company, which is absolute and unconditional,  to pay the principal
         of, interest and liquidated  damages (if any) on, this Debenture at the
         time, place, and rate, and in the coin or currency,  herein prescribed.
         This  Debenture  is a  direct  debt  obligation  of the  Company.  This
         Debenture  ranks PARI PASSU with all other  Debentures now or hereafter
         issued under the terms set forth herein.

                  c) LOST OR MUTILATED  DEBENTURE.  If this  Debenture  shall be
         mutilated,  lost,  stolen or  destroyed,  the Company shall execute and
         deliver,  in exchange and substitution  for and upon  cancellation of a
         mutilated  Debenture,  or in  lieu  of or in  substitution  for a lost,
         stolen or destroyed Debenture, a new Debenture for the principal amount
         of this Debenture so mutilated, lost, stolen or destroyed but only upon
         receipt  of  evidence  of  such  loss,  theft  or  destruction  of such
         Debenture,  and of the ownership hereof,  and indemnity,  if requested,
         all reasonably satisfactory to the Company.

                  d) GOVERNING LAW. 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 legal proceedings
         concerning  the   interpretations,   enforcement  and  defense  of  the
         transactions  contemplated by any of the Transaction Documents (whether
         brought against a party hereto or its respective affiliates, directors,
         officers, shareholders,  employees or agents) shall be commenced 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 the
         adjudication of any dispute hereunder or in connection herewith or with
         any transaction contemplated hereby or discussed herein (including with
         respect to the enforcement of any of the Transaction

                                       19
<PAGE>

         Documents),  and hereby irrevocably waives, and agrees not to assert in
         any suit,  action or  proceeding,  any claim that it is not  personally
         subject to the  jurisdiction of any such court, or such New York Courts
         are  improper or  inconvenient  venue for such  proceeding.  Each party
         hereby  irrevocably  waives personal service of process and consents to
         process being served in any such suit,  action or 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  arising  out  of or  relating  to  this  Debenture  or  the
         transactions  contemplated  hereby.  If either party shall  commence an
         action or proceeding to enforce any provisions of this Debenture,  then
         the prevailing  party in such action or proceeding  shall be reimbursed
         by the other party for its attorneys  fees and other costs and expenses
         incurred with the  investigation,  preparation  and prosecution of such
         action or proceeding.

                  e) WAIVER. Any waiver by the Company or the Holder of a breach
         of any provision of this Debenture shall not operate as or be construed
         to be a waiver of any other  breach of such  provision or of any breach
         of any other provision of this Debenture. The failure of the Company or
         the  Holder  to  insist  upon  strict  adherence  to any  term  of this
         Debenture on one or more occasions  shall not be considered a waiver or
         deprive  that  party of the  right  thereafter  to insist  upon  strict
         adherence to that term or any other term of this Debenture.  Any waiver
         must be in writing.

                  f)  SEVERABILITY.  If  any  provision  of  this  Debenture  is
         invalid, illegal or unenforceable,  the balance of this Debenture shall
         remain in effect, and if any provision is inapplicable to any person or
         circumstance,  it shall  nevertheless  remain  applicable  to all other
         persons and  circumstances.  If it shall be found that any  interest or
         other amount deemed  interest due hereunder  violates  applicable  laws
         governing  usury,  the applicable  rate of interest due hereunder shall
         automatically  be  lowered  to  equal  the  maximum  permitted  rate of
         interest.  The Company covenants (to the extent that it may lawfully do
         so) that it shall not at any time insist upon,  plead, or in any manner
         whatsoever  claim  or take the  benefit  or  advantage  of,  any  stay,
         extension or usury law or other law which would prohibit or forgive the
         Company from paying all or any portion of the  principal of or interest
         on this Debenture as contemplated  herein,  wherever enacted, now or at
         any time  hereafter in force,  or which may affect the covenants or the
         performance  of this  indenture,  and the Company (to the extent it may
         lawfully do so) hereby  expressly  waives all  benefits or advantage of
         any such law,  and  covenants  that it will not,  by resort to any such
         law, hinder, delay or impeded the execution of any power herein granted
         to the Holder,  but will suffer and permit the  execution of every such
         as though no such law has been enacted.

                                       20
<PAGE>

                  g) NEXT BUSINESS DAY. Whenever any payment or other obligation
         hereunder shall be due on a day other than a Business Day, such payment
         shall be made on the next succeeding Business Day.

                  h) HEADINGS. The headings contained 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.

                              *********************

                                       21
<PAGE>

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

                                          SECURED SERVICES, INC.

                                          By:___________________________________
                                             Name:
                                             Title:

                                       22
<PAGE>

                                     ANNEX A

                              NOTICE OF CONVERSION

         The  undersigned  hereby  elects to  convert  principal  under the 7.5%
Convertible  Debenture of Secured  Services,  Inc., a Delaware  corporation (the
"COMPANY"), due on June 13, 2008, into shares of common stock, par value $0.0001
per share (the  "COMMON  STOCK"),  of the Company  according  to the  conditions
hereof,  as of the date written below. If shares are to be issued in the name of
a person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto and is delivering  herewith such  certificates  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.

         By the delivery of this Notice of Conversion the undersigned represents
and  warrants to the Company  that its  ownership  of the Common  Stock does not
exceed the amounts  determined in accordance  with Section 13(d) of the Exchange
Act, specified under Section 4 of this Debenture.

         The  undersigned   agrees  to  comply  with  the  prospectus   delivery
requirements  under  the  applicable  securities  laws in  connection  with  any
transfer of the aforesaid shares of Common Stock.

Conversion calculations:

                           Date to Effect Conversion:

                           Principal Amount of Debentures to be Converted:

                           Payment of Interest in Common Stock __ yes  __ no
                               If yes, $_____ of Interest Accrued on Account of
                               Conversion at Issue.

                           Number of shares of Common Stock to be issued:

                           Signature:

                           Name:

                           Address:

                                       23
<PAGE>

                                   SCHEDULE 1

                               CONVERSION SCHEDULE

The 7.5% Convertible Debentures due on June 13, 2005, in the aggregate principal
amount  of  $____________   issued  by  Secured   Services,   Inc.,  a  Delaware
corporation.  This Conversion Schedule reflects conversions made under Section 4
of the above referenced Debenture.

                                     Dated:

================================================================================
                                               Aggregate
                                               Principal
                                                 Amount
                                               Remaining
  Date of Conversion        Amount of         Subsequent to    Company Attest
 (or for first entry,       Conversion         Conversion
  Original Issue Date)                        (or original
                                                Principal
                                                 Amount)
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

================================================================================

                                       24Exhibit 4.2

                                                                       EXHIBIT C

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
HAVE  BEEN  REGISTERED  WITH  THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR THE
SECURITIES   COMMISSION  OF  ANY  STATE  IN  RELIANCE  UPON  AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH  EFFECT,  THE  SUBSTANCE  OF WHICH SHALL BE  REASONABLY  ACCEPTABLE  TO THE
COMPANY.  THIS  SECURITY  AND THE  SECURITIES  ISSUABLE  UPON  EXERCISE  OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION  WITH A BONA FIDE MARGIN  ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.

                          COMMON STOCK PURCHASE WARRANT

                To Purchase __________ Shares of Common Stock of

                             SECURED SERVICES, INC.

                  THIS COMMON STOCK PURCHASE  WARRANT (the "WARRANT")  certifies
that, for value received,  _____________ (the "HOLDER"),  is entitled,  upon the
terms and subject to the limitations on exercise and the conditions  hereinafter
set forth, at any time on or after the date hereof (the "INITIAL EXERCISE DATE")
and on or prior to the close of  business  on the four year  anniversary  of the
Initial Exercise Date (the "TERMINATION DATE") but not thereafter,  to subscribe
for and  purchase  from Secured  Services,  Inc.,  a Delaware  corporation  (the
"COMPANY"),  up to ______  shares (the "WARRANT  SHARES") of Common  Stock,  par
value $0.0001 per share, of the Company (the "COMMON STOCK"). The purchase price
of one share of Common Stock under this  Warrant  shall be equal to the Exercise
Price, as defined in Section 2(b).

         SECTION  1.  DEFINITIONS.  Capitalized  terms  used  and not  otherwise
defined  herein shall have the  meanings  set forth in that  certain  Securities
Purchase  Agreement (the "PURCHASE  AGREEMENT"),  dated June 13, 2005, among the
Company and the purchasers signatory thereto.

         SECTION 2. EXERCISE.

                  a)  EXERCISE  OF  WARRANT.  Exercise  of the  purchase  rights
         represented  by this Warrant may be made,  in whole or in part,  at any
         time or times on or after the  Initial  Exercise  Date and on or before
         the  Termination  Date by delivery  to the  Company of a duly  executed
         facsimile  copy of the Notice of Exercise Form annexed  hereto (or such
         other office or agency of the Company as it may  designate by notice in
         writing  to  the  registered  Holder  at the  address  of  such  Holder
         appearing on the books of the  Company);

                                       1
<PAGE>

         PROVIDED,  HOWEVER,  within 5 Trading  Days of the date said  Notice of
         Exercise is delivered to the Company, the Holder shall have surrendered
         this Warrant to the Company and the Company shall have received payment
         of the aggregate Exercise Price of the shares thereby purchased by wire
         transfer or cashier's check drawn on a United States bank.

                  b) EXERCISE  PRICE.  The  exercise  price of the Common  Stock
         under this Warrant shall be $1.2791,  subject to  adjustment  hereunder
         (the "EXERCISE PRICE").

                  c) CASHLESS  EXERCISE.  If at any time after one year from the
         date of issuance of this  Warrant  there is no  effective  Registration
         Statement  registering,  or no current  prospectus  available  for, the
         resale of the Warrant Shares by the Holder,  then this Warrant may also
         be  exercised  at such time by means of a "cashless  exercise" in which
         the Holder shall be entitled to receive a certificate for the number of
         Warrant Shares equal to the quotient  obtained by dividing  [(A-B) (X)]
         by (A), where:

                  (A) = the VWAP on the Trading Day  immediately  preceding  the
                        date of such election;

                  (B) = the Exercise Price of this Warrant, as adjusted; and

                  (X) = the number of Warrant  Shares  issuable upon exercise of
                        this  Warrant  in  accordance  with  the  terms  of this
                        Warrant  by  means  of  a  cash  exercise  rather than a
                        cashless exercise.

                  Notwithstanding  anything  herein to the contrary,  unless the
         Company   provides  the  Holder  written  notice,   setting  forth  the
         forthcoming  Termination  Date,  at least 10 Trading  Days prior to the
         Termination  Date, then, on the Termination Date, this Warrant shall be
         automatically  exercised via cashless exercise pursuant to this Section
         2(c).

                  d) EXERCISE  LIMITATIONS;  HOLDER'S  RESTRICTIONS.  The Holder
         shall not have the  right to  exercise  any  portion  of this  Warrant,
         pursuant to Section 2(c) or otherwise,  to the extent that after giving
         effect to such issuance after exercise,  the Holder  (together with the
         Holder's  affiliates),  as  set  forth  on  the  applicable  Notice  of
         Exercise,  would  beneficially  own in excess of 4.99% of the number of
         shares of the Common Stock outstanding  immediately after giving effect
         to such issuance. 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  exercise of this Warrant 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)  exercise  of the
         remaining,  nonexercised  portion of this Warrant 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 shares of Debentures
         or  Warrants)  subject  to  a  limitation  on  conversion  or  exercise
         analogous to the limitation  contained herein beneficially owned by the
         Holder or any of its  affiliates.  Except as set forth in the preceding
         sentence, for purposes of this Section 2(d), beneficial ownership shall
         be calculated in accordance  with Section 13(d) of the Exchange Act, it
         being  acknowledged

                                       2
<PAGE>

         by Holder  that the  Company is not  representing  to Holder  that such
         calculation is in compliance with Section 13(d) of the Exchange Act and
         Holder is solely  responsible for any schedules required to be filed in
         accordance  therewith.  To the extent that the limitation  contained in
         this Section 2(d) applies, the determination of whether this Warrant is
         exercisable (in relation to other  securities  owned by the Holder) and
         of which a portion of this Warrant is exercisable  shall be in the sole
         discretion of such Holder,  and the  submission of a Notice of Exercise
         shall be deemed  to be such  Holder's  determination  of  whether  this
         Warrant is exercisable (in relation to other  securities  owned by such
         Holder) and of which  portion of this Warrant is  exercisable,  in each
         case subject to such aggregate percentage  limitation,  and the Company
         shall have no  obligation  to verify or confirm  the  accuracy  of such
         determination.  For purposes of this Section 2(d), 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-QSB or Form 10-KSB,  as the case may
         be, (y) a more  recent  public  announcement  by the Company or (z) any
         other notice by the Company or the  Company's  Transfer  Agent  setting
         forth  the  number of shares  of  Common  Stock  outstanding.  Upon the
         written or oral  request of the Holder,  the Company  shall  within two
         Trading 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 Warrant,  by the Holder or its affiliates since the date
         as of which  such  number of  outstanding  shares  of Common  Stock was
         reported.  The  provisions  of this  Section  2(d) may be waived by the
         Holder,  at the  election  of the  Holder,  upon not less than 61 days'
         prior notice to the Company,  and the  provisions  of this Section 2(d)
         shall  continue to apply  until such 61st day (or such later  date,  as
         determined  by the  Holder,  as may be  specified  in  such  notice  of
         waiver).

                  e)       MECHANICS OF EXERCISE.

                                    i.  AUTHORIZATION  OF  WARRANT  SHARES.  The
                           Company  covenants  that all Warrant Shares which may
                           be issued upon the  exercise of the  purchase  rights
                           represented  by this Warrant  will,  upon exercise of
                           the purchase rights  represented by this Warrant,  be
                           duly  authorized,  validly  issued,  fully  paid  and
                           nonassessable  and free  from all  taxes,  liens  and
                           charges in respect of the issue  thereof  (other than
                           taxes   in   respect   of  any   transfer   occurring
                           contemporaneously with such issue).

                                    ii. DELIVERY OF CERTIFICATES  UPON EXERCISE.
                           Certificates for shares purchased  hereunder shall be
                           transmitted  by the transfer  agent of the Company to
                           the Holder by  crediting  the account of the Holder's
                           prime  broker  with  the  Depository   Trust  Company
                           through  its  Deposit   Withdrawal  Agent  Commission
                           ("DWAC")  system if the Company is a  participant  in
                           such system,  and  otherwise by physical  delivery to
                           the address  specified by the Holder in the Notice of
                           Exercise  within 3 Trading  Days from the delivery to
                           the Company of the Notice of Exercise Form, surrender
                           of this Warrant and payment of the aggregate Exercise
                           Price as set forth  above  ("WARRANT  SHARE  DELIVERY
                           DATE").  This  Warrant  shall be

                                       3
<PAGE>

                           deemed  to  have  been  exercised  on  the  date  the
                           Exercise  Price  is  received  by  the  Company.  The
                           Warrant  Shares  shall be deemed to have been issued,
                           and Holder or any other  person so  designated  to be
                           named therein shall be deemed to have become a holder
                           of record of such shares for all purposes,  as of the
                           date the Warrant has been exercised by payment to the
                           Company of the Exercise  Price and all taxes required
                           to be paid by the Holder, if any, pursuant to Section
                           2(e)(vii) prior to the issuance of such shares,  have
                           been paid.

                                    iii. DELIVERY OF NEW WARRANTS UPON EXERCISE.
                           If this  Warrant  shall have been  exercised in part,
                           the  Company  shall,  at the time of  delivery of the
                           certificate  or  certificates   representing  Warrant
                           Shares,  deliver to Holder a new  Warrant  evidencing
                           the  rights  of Holder to  purchase  the  unpurchased
                           Warrant Shares called for by this Warrant,  which new
                           Warrant shall in all other respects be identical with
                           this Warrant.

                                    iv. RESCISSION  RIGHTS. If the Company fails
                           to cause its transfer agent to transmit to the Holder
                           a  certificate  or  certificates   representing   the
                           Warrant Shares  pursuant to this Section  2(e)(iv) by
                           the Warrant Share Delivery Date, then the Holder will
                           have the right to rescind such exercise.

                                    v.  COMPENSATION  FOR  BUY-IN ON  FAILURE TO
                           TIMELY  DELIVER   CERTIFICATES   UPON  EXERCISE.   In
                           addition to any other rights available to the Holder,
                           if the Company  fails to cause its transfer  agent to
                           transmit to the Holder a certificate or  certificates
                           representing   the  Warrant  Shares  pursuant  to  an
                           exercise  on or before  the  Warrant  Share  Delivery
                           Date,  and if after such date the Holder is  required
                           by  its  broker  to  purchase   (in  an  open  market
                           transaction  or otherwise)  shares of Common Stock to
                           deliver  in  satisfaction  of a sale by the Holder of
                           the  Warrant  Shares  which  the  Holder  anticipated
                           receiving  upon such exercise (a "BUY-IN"),  then the
                           Company  shall  (1)  pay in cash  to the  Holder  the
                           amount by which (x) the Holder's total purchase price
                           (including  brokerage  commissions,  if any)  for the
                           shares of Common Stock so  purchased  exceeds (y) the
                           amount  obtained  by  multiplying  (A) the  number of
                           Warrant  Shares  that the  Company  was  required  to
                           deliver to the Holder in connection with the exercise
                           at issue  times (B) the price at which the sell order
                           giving rise to such purchase obligation was executed,
                           and (2) at the option of the Holder, either reinstate
                           the portion of the Warrant and  equivalent  number of
                           Warrant  Shares  for  which  such  exercise  was  not
                           honored or deliver to the Holder the number of shares
                           of Common  Stock that would have been  issued had the
                           Company   timely   complied  with  its  exercise  and
                           delivery obligations  hereunder.  For example, if the
                           Holder purchases Common Stock having a total purchase
                           price of $11,000 to cover a Buy-In with respect to an
                           attempted  exercise of shares of Common Stock with an
                           aggregate  sale price  giving  rise to such  purchase
                           obligation  of  $10,000,  under  clause  (1)  of  the
                           immediately  preceding  sentence the Company shall

                                       4
<PAGE>

                           be  required  to pay the  Holder  $1,000.  The Holder
                           shall provide the Company  written notice  indicating
                           the  amounts  payable to the Holder in respect of the
                           Buy-In,  together with applicable  confirmations  and
                           other evidence  reasonably  requested by the Company.
                           Nothing herein shall limit a Holder's right to pursue
                           any other remedies available to it hereunder,  at law
                           or in equity including,  without limitation, a decree
                           of specific performance and/or injunctive relief with
                           respect to the  Company's  failure to timely  deliver
                           certificates representing shares of Common Stock upon
                           exercise of the  Warrant as required  pursuant to the
                           terms hereof.

                                    vi.  NO  FRACTIONAL   SHARES  OR  SCRIP.  No
                           fractional  shares or scrip  representing  fractional
                           shares  shall be  issued  upon the  exercise  of this
                           Warrant.  As to any  fraction of a share which Holder
                           would  otherwise  be entitled  to purchase  upon such
                           exercise,  the Company shall pay a cash adjustment in
                           respect of such final  fraction in an amount equal to
                           such fraction multiplied by the Exercise Price.

                                    vii. CHARGES,  TAXES AND EXPENSES.  Issuance
                           of  certificates  for  Warrant  Shares  shall be made
                           without  charge  to  the  Holder  for  any  issue  or
                           transfer tax or other  incidental  expense in respect
                           of the  issuance  of such  certificate,  all of which
                           taxes and expenses shall be paid by the Company,  and
                           such certificates  shall be issued in the name of the
                           Holder or in such name or names as may be directed by
                           the  Holder;  PROVIDED,  HOWEVER,  that in the  event
                           certificates for Warrant Shares are to be issued in a
                           name other than the name of the Holder,  this Warrant
                           when surrendered for exercise shall be accompanied by
                           the Assignment  Form attached hereto duly executed by
                           the  Holder;  and  the  Company  may  require,  as  a
                           condition thereto, the payment of a sum sufficient to
                           reimburse it for any transfer tax incidental thereto.

                                    viii. CLOSING OF BOOKS. The Company will not
                           close its stockholder  books or records in any manner
                           which  prevents the timely  exercise of this Warrant,
                           pursuant to the terms hereof.

         SECTION 3. CERTAIN ADJUSTMENTS.

                  a) STOCK  DIVIDENDS  AND SPLITS.  If the Company,  at any time
         while  this  Warrant  is  outstanding:  (A)  pays a stock  dividend  or
         otherwise make a distribution or  distributions on shares of its Common
         Stock or any other equity or equity  equivalent  securities  payable in
         shares  of Common  Stock  (which,  for  avoidance  of doubt,  shall not
         include any shares of Common  Stock  issued by the Company  pursuant to
         this Warrant), (B) subdivides outstanding shares of Common Stock into a
         larger  number of shares,  (C)  combines  (including  by way of reverse
         stock split)  outstanding  shares of Common Stock into a smaller number
         of shares,  or (D) issues by  reclassification  of shares of the Common
         Stock any shares of capital stock of the Company, then in each case the
         Exercise Price shall be multiplied by a fraction of which the numerator
         shall be the

                                       5
<PAGE>

         number of shares of Common Stock (excluding  treasury  shares,  if any)
         outstanding  immediately before such event and of which the denominator
         shall be the number of shares of Common Stock  outstanding  immediately
         after such event and the number of shares  issuable  upon  exercise  of
         this Warrant shall be  proportionately  adjusted.  Any adjustment  made
         pursuant to this Section 3(a) shall become effective  immediately after
         the record  date for the  determination  of  stockholders  entitled  to
         receive  such  dividend  or  distribution  and shall  become  effective
         immediately  after  the  effective  date in the case of a  subdivision,
         combination or re-classification.

                  b) SUBSEQUENT  EQUITY SALES.  If the Company or any Subsidiary
         thereof, as applicable,  at any time while this Warrant is outstanding,
         shall offer, sell, grant any option to purchase or offer, sell or grant
         any right to reprice its securities,  or otherwise  dispose of or issue
         (or announce any offer,  sale, grant or any option to purchase or other
         disposition) any Common Stock or Common Stock Equivalents entitling any
         Person to acquire  shares of Common  Stock,  at an effective  price per
         share less than the then  Exercise  Price (such lower price,  the "BASE
         SHARE PRICE" and such issuances  collectively,  a "DILUTIVE ISSUANCE"),
         as  adjusted  hereunder  (if the holder of the  Common  Stock or Common
         Stock Equivalents so issued shall at any time,  whether by operation of
         purchase price  adjustments,  reset  provisions,  floating  conversion,
         exercise or exchange prices or otherwise,  or due to warrants,  options
         or rights per share which is issued in connection  with such  issuance,
         be entitled to receive shares of Common Stock at an effective price per
         share which is less than the Exercise  Price,  such  issuance  shall be
         deemed to have occurred for less than the Exercise  Price),  then,  the
         Exercise  Price  shall be  reduced  and only  reduced to equal the Base
         Share Price and the number of Warrant Shares  issuable  hereunder shall
         be increased such that the aggregate  Exercise Price payable hereunder,
         after taking into account the decrease in the Exercise Price,  shall be
         equal to the aggregate  Exercise Price prior to such  adjustment.  Such
         adjustment  shall be made  whenever  such Common  Stock or Common Stock
         Equivalents are issued.  Notwithstanding the foregoing,  no adjustments
         shall be made,  paid or issued under this Section 3(b) in respect of an
         Exempt  Issuance.  The Company  shall notify the Holder in writing,  no
         later than the Trading Day  following  the issuance of any Common Stock
         or Common Stock Equivalents subject to this section, indicating therein
         the applicable  issuance price, or of applicable reset price,  exchange
         price,  conversion  price and other  pricing  terms  (such  notice  the
         "DILUTIVE ISSUANCE NOTICE"). For purposes of clarification,  whether or
         not the Company  provides a Dilutive  Issuance  Notice pursuant to this
         Section 3(b), upon the occurrence of any Dilutive  Issuance,  after the
         date of such  Dilutive  Issuance  the Holder is  entitled  to receive a
         number of Warrant Shares based upon the Base Share Price  regardless of
         whether  the Holder  accurately  refers to the Base Share  Price in the
         Notice of Exercise.

                  c) PRO RATA  DISTRIBUTIONS.  If the Company, at any time prior
         to the  Termination  Date,  shall  distribute  to all holders of Common
         Stock  (and  not  to  Holders  of  the   Warrants)   evidences  of  its
         indebtedness or assets (including cash and cash dividends) or rights or
         warrants to  subscribe  for or  purchase  any  security  other than the
         Common  Stock (which  shall be subject to Section  3(b)),  then in each
         such case the  Exercise  Price  shall be adjusted  by  multiplying  the
         Exercise Price in effect immediately prior to the record date fixed for
         determination of stockholders  entitled to receive such distribution by

                                       6
<PAGE>

         a fraction of which the denominator  shall be the VWAP determined as of
         the record date mentioned  above,  and of which the numerator  shall be
         such VWAP on such record date less the then per share fair market value
         at such  record  date of the  portion  of such  assets or  evidence  of
         indebtedness so distributed  applicable to one outstanding share of the
         Common Stock as determined by the Board of Directors in good faith.  In
         either case the adjustments shall be described in a statement  provided
         to the Holder of the portion of assets or evidences of  indebtedness so
         distributed  or such  subscription  rights  applicable  to one share of
         Common  Stock.   Such  adjustment  shall  be  made  whenever  any  such
         distribution is made and shall become effective  immediately  after the
         record date mentioned above.

                  d) FUNDAMENTAL TRANSACTION. If, at any time while this Warrant
         is outstanding,  (A) the Company effects any merger or consolidation of
         the Company with or into another  Person,  (B) the Company  effects any
         sale of all or  substantially  all of its  assets in one or a series of
         related  transactions,  (C) any tender offer or exchange offer (whether
         by the  Company  or  another  Person) is  completed  pursuant  to which
         holders  of Common  Stock are  permitted  to tender or  exchange  their
         shares  for other  securities,  cash or  property,  or (D) the  Company
         effects  any  reclassification  of the Common  Stock or any  compulsory
         share  exchange  pursuant  to which  the  Common  Stock is  effectively
         converted into or exchanged for other securities,  cash or property (in
         any such case, a "FUNDAMENTAL TRANSACTION"),  then, upon any subsequent
         exercise of this  Warrant,  the Holder shall have the right to receive,
         for each Warrant Share that would have been issuable upon such exercise
         immediately prior to the occurrence of such Fundamental Transaction, at
         the option of the Holder, (a) upon exercise of this Warrant, the number
         of shares of Common Stock of the successor or acquiring  corporation or
         of the Company, if it is the surviving corporation,  and any additional
         consideration (the "ALTERNATE  CONSIDERATION")  receivable upon or as a
         result of such reorganization,  reclassification, merger, consolidation
         or  disposition of assets by a Holder of the number of shares of Common
         Stock for which this Warrant is exercisable  immediately  prior to such
         event or (b) if the  Company is  acquired  in an all cash  transaction,
         cash equal to the value of this  Warrant as  determined  in  accordance
         with the Black-Scholes option pricing formula. For purposes of any such
         exercise,   the   determination   of  the   Exercise   Price  shall  be
         appropriately  adjusted to apply to such Alternate  Consideration based
         on the amount of  Alternate  Consideration  issuable  in respect of one
         share of Common Stock in such Fundamental Transaction,  and the Company
         shall apportion the Exercise Price among the Alternate Consideration in
         a reasonable  manner  reflecting  the relative  value of any  different
         components of the Alternate  Consideration.  If holders of Common Stock
         are  given any  choice as to the  securities,  cash or  property  to be
         received in a Fundamental  Transaction,  then the Holder shall be given
         the same choice as to the Alternate  Consideration it receives upon any
         exercise of this Warrant following such Fundamental Transaction. To the
         extent necessary to effectuate the foregoing provisions,  any successor
         to the  Company or  surviving  entity in such  Fundamental  Transaction
         shall issue to the Holder a new warrant  consistent  with the foregoing
         provisions  and  evidencing the Holder's right to exercise such warrant
         into Alternate  Consideration.  The terms of any agreement  pursuant to
         which  a  Fundamental  Transaction  is  effected  shall  include  terms
         requiring  any such  successor or  surviving  entity to comply with the
         provisions  of this Section 3(d) and insuring that this Warrant (or any
         such replacement

                                       7
<PAGE>

         security) will be similarly  adjusted upon any  subsequent  transaction
         analogous to a Fundamental Transaction.

                  e) CALCULATIONS.  All calculations  under this Section 3 shall
         be made to the nearest cent or the nearest  1/100th of a share,  as the
         case may be. For  purposes  of this  Section 3, the number of shares of
         Common  Stock  deemed to be issued and  outstanding  as of a given date
         shall be the sum of the  number of shares  of Common  Stock  (excluding
         treasury shares, if any) issued and outstanding.

                  f)  VOLUNTARY  ADJUSTMENT  BY COMPANY.  The Company may at any
         time during the term of this Warrant  reduce the then current  Exercise
         Price to any amount and for any period of time  deemed  appropriate  by
         the Board of Directors of the Company.

                  g)       NOTICE TO HOLDERS.

                                    i.  ADJUSTMENT TO EXERCISE  PRICE.  Whenever
                           the  Exercise  Price  is  adjusted  pursuant  to this
                           Section 3, the Company  shall  promptly  mail to each
                           Holder a notice  setting  forth  the  Exercise  Price
                           after  such  adjustment  and  setting  forth  a brief
                           statement of the facts requiring such adjustment.  If
                           the Company issues a variable rate security,  despite
                           the  prohibition  thereon in the Purchase  Agreement,
                           the  Company  shall be deemed to have  issued  Common
                           Stock  or  Common  Stock  Equivalents  at the  lowest
                           possible  conversion or exercise  price at which such
                           securities  may be converted or exercised in the case
                           of a Variable  Rate  Transaction  (as  defined in the
                           Purchase Agreement).

                                    ii. NOTICE TO ALLOW  EXERCISE BY HOLDER.  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 the Common  Stock  rights or  warrants  to
                           subscribe for or purchase any shares of capital stock
                           of any class or of any  rights;  (D) the  approval of
                           any  stockholders of the Company shall be required in
                           connection  with any  reclassification  of the Common
                           Stock,  any  consolidation  or  merger  to which  the
                           Company is a party,  any sale or  transfer  of all or
                           substantially  all of the assets of the  Company,  of
                           any  compulsory  share  exchange  whereby  the Common
                           Stock is  converted  into other  securities,  cash or
                           property;   (E)  the  Company  shall   authorize  the
                           voluntary or involuntary dissolution,  liquidation or
                           winding up of the affairs of the  Company;  then,  in
                           each case,  the  Company  shall cause to be mailed to
                           the  Holder at its last  address  as it shall  appear
                           upon the Warrant Register 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 the
                           Common  Stock  of  record  to  be  entitled  to  such
                           dividend,   distributions,   redemption,   rights  or
                           warrants

                                       8
<PAGE>

                           are to be  determined  or (y) the date on which  such
                           reclassification,    consolidation,   merger,   sale,
                           transfer  or share  exchange  is  expected  to become
                           effective  or  close,  and the date as of which it is
                           expected  that  holders of the Common Stock of record
                           shall be  entitled to  exchange  their  shares of the
                           Common Stock for  securities,  cash or other property
                           deliverable      upon     such      reclassification,
                           consolidation,   merger,   sale,  transfer  or  share
                           exchange;  PROVIDED,  that the  failure  to mail such
                           notice  or  any  defect  therein  or in  the  mailing
                           thereof   shall  not  affect  the   validity  of  the
                           corporate  action  required to be  specified  in such
                           notice.  The  Holder is  entitled  to  exercise  this
                           Warrant  during the 20-day  period  commencing on the
                           date  of such  notice  to the  effective  date of the
                           event triggering such notice.

         SECTION 4. TRANSFER OF WARRANT.

                  a) TRANSFERABILITY.  Subject to compliance with any applicable
         securities  laws and the conditions set forth in Sections 5(a) and 4(d)
         hereof and to the provisions of Section 4.1 of the Purchase  Agreement,
         this Warrant and all rights hereunder are transferable,  in whole or in
         part,  upon  surrender of this Warrant at the  principal  office of the
         Company,   together   with  a  written   assignment   of  this  Warrant
         substantially  in the form attached  hereto duly executed by the Holder
         or its agent or attorney and funds sufficient to pay any transfer taxes
         payable upon the making of such  transfer.  Upon such surrender and, if
         required,  such  payment,  the Company  shall execute and deliver a new
         Warrant or Warrants in the name of the assignee or assignees and in the
         denomination   or   denominations   specified  in  such  instrument  of
         assignment,  and shall issue to the  assignor a new Warrant  evidencing
         the portion of this  Warrant not so assigned,  and this  Warrant  shall
         promptly  be  cancelled.  A  Warrant,  if  properly  assigned,  may  be
         exercised  by a new holder for the purchase of Warrant  Shares  without
         having a new Warrant issued.

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

                  c) WARRANT REGISTER.  The Company shall register this Warrant,
         upon  records to be  maintained  by the Company for that  purpose  (the
         "WARRANT REGISTER"),  in the name of the record Holder hereof from time
         to time. The Company may deem and treat the  registered  Holder of this
         Warrant as the  absolute  owner  hereof for the purpose of any exercise
         hereof or any  distribution to the Holder,  and for all other purposes,
         absent actual notice to the contrary.

                  d) TRANSFER RESTRICTIONS.  If, at the time of the surrender of
         this  Warrant in  connection  with any  transfer of this  Warrant,  the
         transfer  of  this  Warrant  shall  not be  registered  pursuant  to an
         effective  registration  statement  under the  Securities Act and

                                       9
<PAGE>

         under  applicable  state  securities or blue sky laws,  the Company may
         require,  as a condition of allowing  such transfer (i) that the Holder
         or  transferee  of this  Warrant,  as the case may be,  furnish  to the
         Company a written  opinion of counsel  (which opinion shall be in form,
         substance  and scope  customary  for opinions of counsel in  comparable
         transactions)  to the effect  that such  transfer  may be made  without
         registration  under  the  Securities  Act and  under  applicable  state
         securities or blue sky laws, (ii) that the holder or transferee execute
         and deliver to the Company an  investment  letter in form and substance
         acceptable  to  the  Company  and  (iii)  that  the  transferee  be  an
         "accredited  investor" as defined in Rule  501(a)(1),  (a)(2),  (a)(3),
         (a)(7),  or (a)(8)  promulgated under the Securities Act or a qualified
         institutional  buyer as defined in Rule  144A(a)  under the  Securities
         Act.

         SECTION 5. MISCELLANEOUS.

                  a) TITLE TO WARRANT. Prior to the Termination Date and subject
         to compliance with applicable laws and Section 4 of this Warrant,  this
         Warrant and all rights hereunder are transferable, in whole or in part,
         at the  office or agency of the  Company  by the Holder in person or by
         duly authorized attorney,  upon surrender of this Warrant together with
         the Assignment  Form annexed hereto properly  endorsed.  The transferee
         shall  sign an  investment  letter  in form  and  substance  reasonably
         satisfactory to the Company.

                  b) NO RIGHTS AS SHAREHOLDER UNTIL EXERCISE.  This Warrant does
         not  entitle  the  Holder to any  voting  rights  or other  rights as a
         shareholder  of the  Company  prior to the  exercise  hereof.  Upon the
         surrender  of this  Warrant and the payment of the  aggregate  Exercise
         Price  (or by means of a  cashless  exercise),  the  Warrant  Shares so
         purchased  shall be and be deemed  to be  issued to such  Holder as the
         record owner of such shares as of the close of business on the later of
         the date of such surrender or payment.

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

                  d) SATURDAYS, SUNDAYS, HOLIDAYS, ETC. If the last or appointed
         day for  the  taking  of any  action  or the  expiration  of any  right
         required  or  granted  herein  shall be a  Saturday,  Sunday or a legal
         holiday,  then such action may be taken or such right may be  exercised
         on the next succeeding day not a Saturday, Sunday or legal holiday.

                  e) AUTHORIZED SHARES.

                           The  Company  covenants  that  during  the period the
                  Warrant is  outstanding,  it will reserve from its  authorized
                  and unissued  Common  Stock a  sufficient  number of shares to
                  provide  for the  issuance  of the  Warrant  Shares  upon  the

                                       10
<PAGE>

                  exercise  of any  purchase  rights  under  this  Warrant.  The
                  Company  further  covenants  that its issuance of this Warrant
                  shall  constitute  full  authority  to its  officers  who  are
                  charged  with  the duty of  executing  stock  certificates  to
                  execute and issue the necessary  certificates  for the Warrant
                  Shares upon the  exercise of the  purchase  rights  under this
                  Warrant.  The Company will take all such reasonable  action as
                  may be  necessary  to assure that such  Warrant  Shares may be
                  issued as provided herein without  violation of any applicable
                  law or  regulation,  or of  any  requirements  of the  Trading
                  Market upon which the Common Stock may be listed.

                           Except and to the extent as waived or consented to by
                  the Holder,  the Company  shall not by any action,  including,
                  without limitation,  amending its certificate of incorporation
                  or   through   any   reorganization,   transfer   of   assets,
                  consolidation,   merger,   dissolution,   issue   or  sale  of
                  securities  or any other  voluntary  action,  avoid or seek to
                  avoid the  observance  or  performance  of any of the terms of
                  this  Warrant,  but will at all times in good faith  assist in
                  the  carrying  out of all such  terms and in the taking of all
                  such actions as may be necessary or appropriate to protect the
                  rights  of  Holder  as  set  forth  in  this  Warrant  against
                  impairment.  Without limiting the generality of the foregoing,
                  the Company will (a) not increase the par value of any Warrant
                  Shares above the amount  payable  therefor  upon such exercise
                  immediately  prior to such increase in par value, (b) take all
                  such action as may be necessary or  appropriate  in order that
                  the  Company  may  validly  and  legally  issue fully paid and
                  nonassessable   Warrant  Shares  upon  the  exercise  of  this
                  Warrant, and (c) use commercially reasonable efforts to obtain
                  all  such  authorizations,  exemptions  or  consents  from any
                  public regulatory body having  jurisdiction  thereof as may be
                  necessary  to enable the  Company to perform  its  obligations
                  under this Warrant.

                           Before  taking any action  which  would  result in an
                  adjustment  in the  number of  Warrant  Shares  for which this
                  Warrant is exercisable or in the Exercise  Price,  the Company
                  shall obtain all such authorizations or exemptions thereof, or
                  consents  thereto,   as  may  be  necessary  from  any  public
                  regulatory body or bodies having jurisdiction thereof.

                  f) JURISDICTION.  All questions  concerning the  construction,
         validity,  enforcement  and  interpretation  of this  Warrant  shall be
         determined in accordance with the provisions of the Purchase Agreement.

                  g)  RESTRICTIONS.  The Holder  acknowledges  that the  Warrant
         Shares  acquired upon the exercise of this Warrant,  if not registered,
         will  have  restrictions  upon  resale  imposed  by state  and  federal
         securities laws.

                  h) NONWAIVER AND  EXPENSES.  No course of dealing or any delay
         or failure to exercise any right  hereunder on the part of Holder shall
         operate  as a waiver  of such  right or  otherwise  prejudice  Holder's
         rights,  powers or remedies,  notwithstanding  the fact that all rights
         hereunder  terminate on the Termination  Date. If the Company willfully
         and knowingly fails to comply with any provision of this Warrant, which
         results in any

                                       11
<PAGE>

         material  damages to the Holder,  the Company  shall pay to Holder such
         amounts  as shall  be  sufficient  to  cover  any  costs  and  expenses
         including,  but not limited to, reasonable  attorneys' fees,  including
         those of appellate  proceedings,  incurred by Holder in collecting  any
         amounts  due  pursuant  hereto  or in  otherwise  enforcing  any of its
         rights, powers or remedies hereunder.

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

                  j)  LIMITATION  OF  LIABILITY.  No  provision  hereof,  in the
         absence of any affirmative action by Holder to exercise this Warrant or
         purchase  Warrant  Shares,  and no enumeration  herein of the rights or
         privileges  of Holder,  shall give rise to any  liability of Holder for
         the  purchase  price of any  Common  Stock or as a  stockholder  of the
         Company,  whether  such  liability  is  asserted  by the  Company or by
         creditors of the Company.

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

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

                  m)  AMENDMENT.  This Warrant may be modified or amended or the
         provisions  hereof  waived with the written  consent of the Company and
         the Holder.

                  n)  SEVERABILITY.  Wherever  possible,  each provision of this
         Warrant  shall be  interpreted  in such manner as to be  effective  and
         valid under  applicable law, but if any provision of this Warrant shall
         be prohibited by or invalid under  applicable law, such provision shall
         be ineffective to the extent of such prohibition or invalidity, without
         invalidating   the  remainder  of  such  provisions  or  the  remaining
         provisions of this Warrant.

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

                              ********************

                                       12
<PAGE>

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

Dated:  June 13, 2005

                                      SECURED SERVICES, INC.

                                      By:_______________________________________
                                         Name:
                                         Title:

                                       13
<PAGE>

                               NOTICE OF EXERCISE

TO:  SECURED SERVICES, INC.

         (1)______The  undersigned  hereby elects to purchase  ________  Warrant
Shares of the Company  pursuant to the terms of the  attached  Warrant  (only if
exercised in full),  and tenders herewith payment of the exercise price in full,
together with all applicable transfer taxes, if any.

         (2)______Payment shall take the form of (check applicable box):

                           [ ] in lawful money of the United States; or

                           [ ] the cancellation of such number of Warrant Shares
                           as is necessary,  in accordance  with the formula set
                           forth in  subsection  2(c),  to exercise this Warrant
                           with respect to the maximum  number of Warrant Shares
                           purchasable   pursuant  to  the   cashless   exercise
                           procedure set forth in subsection 2(c).

         (3)______Please  issue a certificate or certificates  representing said
Warrant  Shares  in the  name of the  undersigned  or in such  other  name as is
specified below:

                           ----------------------------------------

The Warrant Shares shall be delivered to the following:

                           ----------------------------------------

                           ----------------------------------------

                           ----------------------------------------

         (4) ACCREDITED INVESTOR. The undersigned is an "accredited investor" as
defined  in  Regulation  D  promulgated  under the  Securities  Act of 1933,  as
amended.

[SIGNATURE OF HOLDER]

Name of Investing Entity: ______________________________________________________
SIGNATURE OF AUTHORIZED SIGNATORY OF INVESTING ENTITY: _________________________
Name of Authorized Signatory: __________________________________________________
Title of Authorized Signatory: _________________________________________________
Date: __________________________________________________________________________

<PAGE>

                                 ASSIGNMENT FORM

                    (To assign the foregoing warrant, execute
                   this form and supply required information.
                 Do not use this form to exercise the warrant.)

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

_______________________________________________ whose address is

_________________________________________________________________.

_________________________________________________________________

                                           Dated:  ______________, _______

                      Holder's Signature:  _________________________

                      Holder's Address:    _________________________

                                           _________________________

Signature Guaranteed:  __________________________________________

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

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00086-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00086-of-00352.parquet"}]]