Common use of Conversion Limitation Clause in Contracts

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the Borrower. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of Default. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this the Note an amount that would (a) be convertible into that number of Conversion Shares which would exceed the difference between shares of Common Stock which, when added to the number of shares of Common Stock otherwise beneficially owned by such Holder or including those issuable upon exercise of warrants held by such Holder and would exceed 4.99% of the outstanding shares of Common Stock of the Borrower at the time of conversion or (b) exceed thirty-five percent (35%) of the aggregate dollar trading volume of the Common Stock for the twenty-two (22) day trading period immediately preceding delivery of a Notice of Conversion to the Borrower. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share conversion limitation described in this Section 3.2 shall automatically become null and void without any notice to Borrower upon the occurrence and during the continuance beyond any applicable grace period of an Event of Default which has had, or could reasonably be expected to have a Material Adverse Effect, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Borrower, except that at no time shall the beneficial ownership exceed 19.99% of Defaultthe Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 1.75 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 4,457,995 shares of the Borrower's ’s Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's ’s shareholders, if required by applicable law or regulation. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, Note or the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related AgreementWarrant, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void following notice to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Parent, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a an average price below $2.48 1.295 per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 2,520,966 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's Parent’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed be limited by the Maximum Common Stock Issuance but for this Section 3.2preceding sentence, the Borrower Parent shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the Borrower. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of Default. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the issued and outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 shall automatically become null and void following notice to the Company upon the occurrence and during the continuance of an Event of Default, upon 75 days prior notice to the Borrower Company, or without any notice requirement upon an Event receipt by the Holder of Defaulta Notice of Redemption, except that at no time shall the number of shares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable or issued by the Borrower and acquirable by the Holder Company at a price below $2.48 2.55 per share pursuant to the terms of this Note, the Purchase Agreement Agreement, or any other Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 1,454,593 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's Company’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement, any other Related Agreement or any Related Agreementotherwise, together with the number of shares of Common Stock that would then be issuable by the Borrower Company to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Company shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or the Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would (i) exceed the difference between the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerBorrower or (ii) exceed twenty five percent (25%) of the aggregate dollar trading volume of the Common Stock for the ten (10) day trading period immediately preceding any conversion made pursuant to the terms of this Note. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of Default. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 $ 1.06 [market price of the stock at closing] per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of and/or the Warrant issued on by the Closing Date under Borrower to the January 2005 Holder pursuant to that certain Securities Purchase AgreementAgreement dated April 26, 2004 (the "April Transaction Documents"), shall not exceed an aggregate of 436,012 459,770 shares of the Borrower's Common Stock Stock, (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the Stock)(the "Maximum Common Stock Issuance"), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, April Transaction Documents would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly promptly, but no later than July 31, 2004, call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the issued and outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 shall automatically become null and void following notice to the Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Company, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder a exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Company and acquirable by the Holder at a price below $2.48 0.95 per share pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 2,367,666 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's Company’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Company to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Company shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or the Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between 4.99% of the outstanding shares of Common Stock of the Borrower and the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder. The Holder and 4.99% shall not take a long position in the Borrower’s Common Stock for the purpose, or any other reason, that would result in the Holder’s inability to convert this Note into Common Stock because of the outstanding shares of Common Stock of the Borrowerlimitations contained in this provision. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of Default, without any notice requirement beyond any applicable grace period. At no time shall the beneficial ownership exceed 19.99% of the issued and outstanding Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 0.49 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 shares of the Borrower's ’s Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's ’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Holder’s actions shall be stayed, and B▇▇▇▇▇▇▇ shall promptly call a shareholders meeting within (90) ninety days of H▇▇▇▇▇’s notice to Borrower of such an event to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such the Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the Borrower. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void without any notice to the Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Company, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the aggregate number of shares of Common Stock issuable by the Borrower Company and acquirable by the Holder at a an average price below $2.48 3.10 per share pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 1,428,458 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's Company’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Company to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Company shall promptly call a shareholders meeting and use its best efforts to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or the Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in the first sentence of this Section 3.2 shall automatically become null and void following notice to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Parent, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a price below $2.48 0.91 per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 8,738,173 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's Parent’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Parent shall promptly call a shareholders meeting to solicit consider the shareholder approval approval. The Holder shall not be entitled to vote its shares for any proposal for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void following notice to any Company upon 75 the occurrence and during the continuance of an Event of Default, or upon 120 days prior notice to the Borrower or without any notice requirement upon an Event Parent, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the total number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a price below $2.48 2.65 per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 2,339,050 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's shareholdersParent’s shareholders in accordance with applicable state and federal laws. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Parent shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the issued and outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such the Holder or and issuable to the Holder upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerWarrants. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 2.2 shall automatically become null and void following written notice to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower Parent, except that at no time shall the number of shares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock, or without any notice requirement upon an Event of Defaultsuch lesser amount as required by the applicable Principal Market on which the Parent's Common Stock is listed, unless such shall first be approved by the Parent's stockholders. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a price below $2.48 .81 per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 5,095,933 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the BorrowerParent's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.22.2, the Borrower Parent shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 2.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert exercise pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares shares of Common Stock which would exceed the difference between the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants any option or warrant held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerCompany. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 2.2 shall automatically become null and void without any notice to the Company upon 75 the occurrence and during the continuance beyond any applicable grace period of an Event of Default, or upon 65 days prior notice to the Borrower or without any notice requirement upon an Event Company, except that at no time shall the beneficial ownership exceed 19.99% of Defaultthe Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Company and acquirable by the Holder at a price below $2.48 1.10 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Security Agreement, when aggregated with any Ancillary Agreement, the Secured Convertible Term Note made by the Company to the Holder dated the date hereof (i) as amended, modified and/or supplemented from time to time, the shares of Common Stock issuable upon conversion of all or a portion of "TERM NOTE"), the Note referred to in the January 2005 Purchase Agreement (as defined belowin the Term Note) plus or any Related Agreement (iias defined in the Term Note) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 754,492 shares of the BorrowerCompany's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock IssuanceMAXIMUM COMMON STOCK ISSUANCE"), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the BorrowerCompany's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Security Agreement, any Ancillary Agreement, the Term Note, the Purchase Agreement or any Related Agreement, Agreement together with the number of shares of Common Stock that would then be issuable by the Borrower Company to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Security Agreement, any Ancillary Agreement, the Term Note, the Purchase Agreement or any Related Agreement, Agreement would exceed the Maximum Common Stock Issuance but for this Section 3.2paragraph, the Borrower Company shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Shares of Common Stock which may not be issued due to the limitations set forth in this Section 2.2 shall not be deemed to be Conversion Shares under this Note unless and until their issuance is otherwise permitted as contemplated herein.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between which, when added to the number of shares of Common Stock otherwise beneficially owned by such Holder or including those issuable upon exercise of warrants held by such Holder and would exceed 4.99% of the outstanding shares of Common Stock of the BorrowerBorrower at the time of conversion. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void without any notice to Borrower upon the occurrence and during the continuance beyond any applicable grace period of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of DefaultBorrower. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 2.65 per share pursuant to the terms of this Note, the Secured Convertible Term Note and/or Warrants issued by the Borrower to the Holder pursuant to that certain Securities Purchase Agreement or any Related Agreementdated February 19, when aggregated with 2004 (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement“February Transaction Documents”), shall not exceed an aggregate of 436,012 5,776,614 shares of the Borrower's ’s Common Stock Stock, (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's ’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related AgreementFebruary Transaction Documents, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related AgreementFebruary Transaction Documents, would exceed the Maximum Common Stock Issuance but for this Section 3.2Section, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.” 2. The foregoing amendment shall be effective as of the date hereof. 3. There are no other amendments to the Term Note. 4. The Borrower hereby represents and warrants to Laurus that as of the date hereof all representations, warranties and covenants made by Borrower in connection with the Term Note are true correct and complete and all of Borrower’s covenants requirements have been met. As of the date hereof, no Event of Default under any Related Agreements (as defined in the Securities Purchase Agreement) has occurred or is continuing.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this the Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between shares of Common Stock which, when added to the number of shares of Common Stock otherwise beneficially owned by such Holder or including those issuable upon exercise of warrants held by such Holder and would exceed 4.99% of the outstanding shares of Common Stock of the BorrowerBorrower at the time of conversion. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share conversion limitation described in this Section 3.2 shall automatically become null and void without any notice to Borrower upon the occurrence and during the continuance beyond any applicable grace period of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Borrower, except that at no time shall the beneficial ownership exceed 8.33% of Defaultthe Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) Agreement at a price below the shares market price of the Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreementdate of this Note, shall not exceed an aggregate of 436,012 shares 8.33% of the Borrower's Common Stock shares outstanding (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's ’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void following written notice to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior written notice to the Borrower Parent, except that at no time shall the number of shares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock, or without any notice requirement upon an Event of Defaultsuch lesser amount as required by the applicable Principal Market on which the Parent's Common Stock is listed, unless such shall first be approved by the Parent's stockholders. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a price below $2.48 .81 per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 5,095,933 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock IssuanceMAXIMUM COMMON STOCK ISSUANCE"), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the BorrowerParent's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Parent shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void following written notice to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior written notice to the Borrower Parent, except that at no time shall the number of shares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock, or without any notice requirement upon an Event of Defaultsuch lesser amount as required by the applicable Principal Market on which the Parent's Common Stock is listed, unless such shall first be approved by the Parent's stockholders. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a price below $2.48 .81 per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 5,095,933 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the BorrowerParent's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Parent shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this the Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between shares of Common Stock which, when added to the number of shares of Common Stock otherwise beneficially owned by such Holder or including those issuable upon exercise of warrants held by such Holder and would exceed 4.99% of the outstanding shares of Common Stock of the BorrowerBorrower at the time of conversion. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share conversion limitation described in this Section 3.2 shall automatically become null and void without any notice to Borrower upon the occurrence and during the continuance beyond any applicable grace period of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Borrower, except that at no time shall the beneficial ownership exceed 8.33% of Defaultthe Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) Agreement at a price below the shares market price of the Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreementdate of this Note, shall not exceed an aggregate of 436,012 shares 8.33% of the Borrower's Common Stock shares outstanding (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's ’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between shares of Common Stock which, when added to the number of shares of Common Stock otherwise beneficially owned by such Holder or including those issuable upon exercise of warrants held by such Holder and would exceed 4.99% of the outstanding shares of Common Stock of the BorrowerBorrower at the time of conversion. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share conversion limitation described in the first sentence of this Section 3.2 shall automatically become null and void without any notice to Borrower upon the occurrence and during the continuance beyond any applicable grace period of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of DefaultBorrower. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Company and acquirable by the Holder at a price below $2.48 per share pursuant to the terms of this Note, the Purchase Agreement Agreement, the Warrant (as defined in the Purchase Agreement) or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) in the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement) at a weighted average issue price of below $0.47 taking into account all such issuances, shall not exceed an aggregate of 436,012 6,491,440 shares of the BorrowerCompany's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the BorrowerCompany's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement Agreement, the Warrant or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement Agreement, the Warrant or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, from the date hereof until such time as the Borrower's shareholders have approved an increase in the number of authorized shares of Common Stock, the number of shares of Common Stock issuable by the Borrower pursuant to the term of this Note or any Related Agreement shall not exceed an aggregate of 8,202,012 shares of Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock). The Borrower shall promptly after the date hereof call a shareholders meeting to solicit shareholder approval of an increase in its authorized number of shares of Common Stock.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the issued and outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 shall automatically become null and void following notice to the Company upon the occurrence and during the continuance of an Event of Default, upon 75 days prior notice to the Borrower Company, or without any notice requirement upon an Event receipt by the Holder of Defaulta Notice of Redemption. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Company and acquirable by the Holder at a price below $2.48 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 10,154,300 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance hereunder shall first be approved by the Borrower's Company’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued issuable pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Company to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Company shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess . Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Maximum Common Stock IssuanceHolder or the Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the issued and outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such the Holder or and issuable to the Holder upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerWarrants. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 2.2 shall automatically become null and void without any notice to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Parent, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a price below $2.48 2.30 [insert the greater of market price or book value of the Common Stock as of the date hereof] per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 664,104 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the BorrowerParent's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.22.2, the Borrower Parent shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 2.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between which, when added to the number of shares of Common Stock otherwise beneficially owned by such Holder or including those issuable upon exercise of warrants held by such Holder and would exceed 4.99% of the outstanding shares of Common Stock of the BorrowerBorrower at the time of conversion. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void without any notice to Borrower upon the occurrence and during the continuance beyond any applicable grace period of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of DefaultBorrower. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 1.80 per share pursuant to the terms of this Notethe Secured Convertible Minimum Borrowing Notes, Secured Revolving Note and/or Warrants issued by the Purchase Borrower to the Holder pursuant to that certain Security Agreement or any Related Agreementdated December 3, when aggregated with 2003 (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement“December Transaction Documents”), shall not exceed an aggregate of 436,012 5,595,705 shares of the Borrower's ’s Common Stock Stock, (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's ’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related AgreementDecember Transaction Documents, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related AgreementDecember Transaction Documents, would exceed the Maximum Common Stock Issuance but for this Section 3.2Section, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. 2. The foregoing amendment shall be effective as of the date hereof. 3. There are no other amendments to the MB Note. 4. The Borrower hereby represents and warrants to Laurus that as of the date hereof all representations, warranties and covenants made by Borrower in connection with the MB Note are true correct and complete and all of Borrower’s covenants requirements have been met. As of the date hereof, no Event of Default under any Ancillary Agreements (as defined in the Security Agreement) has occurred or is continuing.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the issued and outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 shall automatically become null and void following notice to the Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Company, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder a exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Company and acquirable by the Holder at a price below $2.48 3.10 per share pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 1,377,533 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's Company’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Company to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any other Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Company shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or the Company. Except for conversions of lesser amounts made pursuant to Section 2.1(a) above, the Holder shall not, pursuant to any Notice of Conversion (defined below) convert an amount less than Ten Thousand Dollars (US$10,000).

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between (i) 4.99% of the outstanding shares of Common Stock and (ii) the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder and 4.99% of the outstanding shares of Common Stock of the BorrowerHolder. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share Shares limitation described in this Section 3.2 shall automatically become null and void without any notice to any Company upon the occurrence and during the continuance of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event Parent, except that at no time shall the number of Defaultshares of Common Stock beneficially owned by the Holder exceed 19.99% of the outstanding shares of Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Parent and acquirable by the Holder at a price below $2.48 2.30 [insert the greater of market price or book value of the Common Stock as of the date hereof] per share pursuant to the terms of this Note, the Purchase Security Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase other Ancillary Agreement, shall not exceed an aggregate of 436,012 664,104 shares of the Borrower's Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "Maximum Common Stock Issuance"), unless the issuance of shares Common Stock hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the BorrowerParent's shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower Parent to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Security Agreement or any Related other Ancillary Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Parent shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance. Notwithstanding anything contained herein to the contrary, the provisions of this Section 3.2 are irrevocable and may not be waived by the Holder or any Company.

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between shares of Common Stock which, when added to the number of shares of Common Stock otherwise beneficially owned by such Holder or including those issuable upon exercise of warrants held by such Holder and would exceed 4.99% of the outstanding shares of Common Stock of the BorrowerBorrower at the time of conversion. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share conversion limitation described in the first sentence of this Section 3.2 shall automatically become null and void without any notice to Borrower upon the occurrence and during the continuance beyond any applicable grace period of an Event of Default, or upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of DefaultBorrower. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower Company and acquirable by the Holder at a price below $2.48 per share pursuant to the terms of this Note, the Purchase Agreement Agreement, the Warrant (as defined in the Purchase Agreement), the Warrant issued to the Holder on May 5, 2005 (as amended, modified or supplemented from time to time, the “Additional Warrant”) or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) in the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement) at a weighted average issue price of below $0.47 taking into account all such issuances, shall not exceed an aggregate of 436,012 6,491,440 shares of the Borrower's Company’s Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's Company’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement Agreement, the Warrant, the Additional Warrant or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement Agreement, the Warrant, the Additional Warrant or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower shall promptly call a shareholders meeting to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.” 7. Section 10 of the Original Warrant shall be amended to read in full as follows:

Conversion Limitation. Notwithstanding anything contained herein to the contrary, the Holder shall not be entitled to convert pursuant to the terms of this Note an amount that would be convertible into that number of Conversion Shares which would exceed the difference between 4.99% of the outstanding shares of Common Stock of the Borrower and the number of shares of Common Stock beneficially owned by such Holder or issuable upon exercise of warrants held by such Holder. The Holder and 4.99% shall not take a long position in the Borrower’s Common Stock for the purpose, or any other reason, that would result in the Holder’s inability to convert this Note into Common Stock because of the outstanding shares of Common Stock of the Borrowerlimitations contained in this provision. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. The Holder may void the Conversion Share limitation described in this Section 3.2 upon 75 days prior notice to the Borrower or without any notice requirement upon an Event of Default, without any notice requirement beyond any applicable grace period. At no time shall the beneficial ownership exceed 19.99% of the issued and outstanding Common Stock. Notwithstanding anything contained herein to the contrary, the number of shares of Common Stock issuable by the Borrower and acquirable by the Holder at a price below $2.48 0.49 per share pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, when aggregated with (i) the shares of Common Stock issuable upon conversion of all or a portion of the Note referred to in the January 2005 Purchase Agreement (as defined below) plus (ii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant plus (iii) the shares of Common Stock issuable upon exercise of all or a portion of the Warrant issued on the Closing Date under the January 2005 Purchase Agreement, shall not exceed an aggregate of 436,012 shares of the Borrower's ’s Common Stock (subject to appropriate adjustment for stock splits, stock dividends, or other similar recapitalizations affecting the Common Stock) (the "“Maximum Common Stock Issuance"”), unless the issuance of shares hereunder in excess of the Maximum Common Stock Issuance shall first be approved by the Borrower's ’s shareholders. If at any point in time and from time to time the number of shares of Common Stock issued pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, together with the number of shares of Common Stock that would then be issuable by the Borrower to the Holder in the event of a conversion or exercise pursuant to the terms of this Note, the Purchase Agreement or any Related Agreement, would exceed the Maximum Common Stock Issuance but for this Section 3.2, the Borrower Holder’s actions shall be stayed, and ▇▇▇▇▇▇▇▇ shall promptly call a shareholders meeting within (90) ninety days of ▇▇▇▇▇▇’s notice to Borrower of such an event to solicit shareholder approval for the issuance of the shares of Common Stock hereunder in excess of the Maximum Common Stock Issuance.