FORM OF SECURED CONVERTIBLE NOTE

                                                                     Exhibit 4.2

                        FORM OF SECURED CONVERTIBLE NOTE

NEITHER THE ISSUANCE AND SALE OF THE SECURITIES  REPRESENTED BY THIS CERTIFICATE
NOR THE  SECURITIES  INTO  WHICH  THESE  SECURITIES  ARE  CONVERTIBLE  HAVE BEEN
REGISTERED  UNDER THE  SECURITIES ACT OF 1933, AS AMENDED,  OR APPLICABLE  STATE
SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,  SOLD,  TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE  REGISTRATION  STATEMENT  FOR
THE SECURITIES  UNDER THE SECURITIES ACT OF 1933, AS AMENDED,  OR (B) AN OPINION
OF COUNSEL,  IN A GENERALLY  ACCEPTABLE FORM, THAT  REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) UNLESS SOLD  PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT.  NOTWITHSTANDING  THE  FOREGOING,  SUBJECT TO  COMPLIANCE  WITH  APPLICABLE
SECURITIES  LAWS, THE  SECURITIES MAY BE PLEDGED IN CONNECTION  WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.
ANY  TRANSFEREE  OF THIS NOTE  SHOULD  CAREFULLY  REVIEW THE TERMS OF THIS NOTE,
INCLUDING  SECTIONS 3(C)(III) AND 18(A) HEREOF. THE PRINCIPAL AMOUNT REPRESENTED
BY THIS NOTE AND,  ACCORDINGLY,  THE SECURITIES  ISSUABLE UPON CONVERSION HEREOF
MAY BE LESS THAN THE AMOUNTS  SET FORTH ON THE FACE  HEREOF  PURSUANT TO SECTION
3(C)(III)  OF  THIS  NOTE.  THIS  INSTRUMENT  IS  SUBJECT  TO  THE  TERMS  OF  A
INTERCREDITOR  AGREEMENT BY AND BETWEEN  FORTRESS CREDIT CORP., AS AGENT (OR ANY
SUCCESSOR OR REPLACEMENT  AGENT) FOR CERTAIN OTHER FINANCIAL  INSTITUTIONS UNDER
THE SENIOR LOAN AGREEMENT (HEREINAFTER DEFINED), AND LAW DEBENTURE TRUST COMPANY
OF NEW YORK (OR ANY SUCCESSOR OR REPLACEMENT  COLLATERAL AGENT), IN ITS CAPACITY
AS  COLLATERAL  AGENT,  FOR THE HOLDER OF THIS NOTE AND THE HOLDERS OF THE OTHER
NOTES,  DATED AS OF NOVEMBER  6, 2006 (AS THE SAME MAY BE AMENDED  SUPPLEMENTED,
RESTATED,  NOVATED OR REPLACED  (INCLUDING IN CONNECTION WITH REPLACEMENT SENIOR
FINANCING) FROM TIME TO TIME, THE "INTERCREDITOR AGREEMENT").

                             AEROBIC CREATIONS, INC.

                            SECURED CONVERTIBLE NOTE

Issuance Date: November 8, 2006      Original Principal Amount: U.S. $__________

            FOR VALUE RECEIVED,  Aerobic Creations, Inc., a Delaware corporation
(which  company has  indicated its intention to change its name to Summit Global
Logistics,  Inc.,  the  "COMPANY"),  hereby  promises  to pay to  the  order  of
[_________]or  registered  permitted assigns ("HOLDER") the amount set out above
as the  Original  Principal  Amount (as  reduced  pursuant  to the terms  hereof
pursuant  to  redemption   (or   prepayment),   conversion  or  otherwise,   the
"PRINCIPAL")  when due,  whether  upon the  Maturity  Date (as  defined  below),
acceleration,

<PAGE>

redemption  (or  prepayment)  or otherwise (in each case in accordance  with the
terms hereof) and to pay interest  ("INTEREST") on any outstanding  Principal at
the applicable Interest Rate, from November 8, 2006 (the "INTEREST  COMMENCEMENT
DATE") until the same becomes due and payable, whether upon an Interest Date (as
defined  below),  the Maturity Date,  acceleration,  conversion,  redemption (or
prepayment)  or otherwise  (in each case in accordance  with the terms  hereof).
This Senior Secured  Convertible Note (including all Senior Secured  Convertible
Notes issued in exchange,  transfer or replacement hereof, as amended, restated,
supplemented and/or modified from time to time in accordance with the provisions
hereof,  this  "NOTE") is one of an issue of Senior  Secured  Convertible  Notes
issued pursuant to the Securities  Purchase  Agreement (as defined below) on the
Closing  Date   (collectively,   the  "NOTES"  and  such  other  Senior  Secured
Convertible Notes, the "OTHER NOTES"). Certain capitalized terms used herein are
defined in Section 28.  Capitalized terms used but not defined herein shall have
the meanings ascribed to them in the Securities Purchase Agreement.

            (1)  MATURITY.  On the Maturity  Date,  the Company shall pay to the
Holder an amount in cash  representing  all outstanding  Principal,  accrued and
unpaid  Interest  and  accrued  and unpaid Late  Charges on such  Principal  and
Interest.  The "MATURITY  DATE" shall be November 8, 2011, as may be extended at
the option of the Holder (i) in the event that,  and for so long as, an Event of
Default (as defined in Section  4(a)) shall have  occurred and be  continuing on
the Maturity  Date (as may be extended  pursuant to this Section 1) or any event
that shall have occurred and be continuing that with the passage of time and the
failure to cure would  result in an Event of Default  and (ii)  through the date
that is ten (10) Business Days after the  consummation of a Change of Control in
the event that a Change of Control is publicly  announced or a Change of Control
Notice (as defined in Section  5(b)) is delivered  prior to the  Maturity  Date.
Except  as  specifically  set  forth  in  Section  8  hereof,  this  Note is not
voluntarily prepayable.

            (2)  INTEREST;  INTEREST  RATE.  (a) Interest on this Note (i) shall
accrue  interest at the Interest Rate,  commencing on the Interest  Commencement
Date,  (ii) shall be computed on the basis of a 360-day year comprised of twelve
(12)  thirty  (30) day  months and (iii)  shall be  payable in arrears  for each
Calendar Quarter on the first day of the succeeding  Calendar Quarter during the
period beginning on the Interest Commencement Date and ending on, and including,
the Maturity Date (each, an "INTEREST  DATE") with the first Interest Date being
January  1,  2007.  Interest  on  this  Note  shall  accrue  from  the  Interest
Commencement  Date  until  the  earlier  to occur of the date (i) the  Principal
Amount is paid or, if a paying agent is engaged by the Company,  transferred  to
such  paying  agent  with  instructions  to pay the same  and  (ii) all  amounts
outstanding under this Note are converted to Common Stock in accordance with the
provisions hereof. Interest shall be payable on each Interest Date to the record
holder of this Note on the applicable  Interest Date, and to the extent that any
principal amount of this Note is converted prior to such Interest Date,  accrued
and unpaid  Interest in respect of such converted  principal  amount and accrued
and  unpaid  Late  Charges in respect  of such  converted  principal  amount and
Interest shall be paid on the  Conversion  Date (as defined below) to the record
holder of this Note on the applicable Conversion Date, in cash.

                  (b) Interest on this Note that is payable,  and is  punctually
paid or duly  provided  for, on any Interest Date shall be paid to the Person in
whose name this Note is  registered  at the close of business on the Record Date
for such  interest  at the office or agency of


                                       2
<PAGE>

the  Company  maintained  for such  purpose or at the office of a payment  agent
located  in the state of New York  engaged  by the  Company  for the  purpose of
making payments under this Note and the Other Notes. Each payment of interest on
this Note shall be made by check  mailed to the address of the Holder  specified
in the register of Notes; PROVIDED,  HOWEVER, that, at the request of the Holder
in writing to the  Company,  interest on the Holder's  Note(s)  shall be paid by
wire transfer in immediately available funds in accordance with the written wire
transfer  instruction supplied by the Holder from time to time to the Company at
least ten (10) Business Days prior to the applicable Interest Date or Conversion
Date.

                  (c) From and after the occurrence  and during the  continuance
of an Event of Default,  the  Interest  Rate shall be  increased  to two percent
(2.0%) in excess of the Interest  Rate  otherwise  payable at such time.  In the
event that such Event of Default is subsequently cured or waived, the adjustment
referred to in the preceding sentence shall cease to be effective as of the date
of such cure or waiver;  provided that the Interest as calculated  and unpaid at
such  increased  rate  during the  continuance  of such  Event of Default  shall
continue  to apply to the extent  relating to the days after the  occurrence  of
such Event of Default to but  excluding the date of cure or waiver of such Event
of  Default.  For  purposes  of this  Section  2(c),  the period of the Event of
Default in respect of Section  4(a)(i) only,  shall commence the first day after
the grace periods  specified  therein expire and shall end on the day upon which
the  applicable  Registration  Statement  becomes  effective  or  again  becomes
available, as applicable.

            (3) CONVERSION OF NOTES.  This Note shall be convertible into shares
of the Company's  common stock, par value $0.001 per share (the "COMMON STOCK"),
on the terms and conditions set forth in this Section 3.

                  (a)  CONVERSION  RIGHT.  Subject to the  provisions of Section
3(d),  at any time or times on or after the date hereof (the  "Issuance  Date"),
the Holder  shall be entitled  to convert  all or any  portion of the  Principal
then-outstanding  into fully paid and  nonassessable  shares of Common  Stock in
accordance  with Section 3(c), at the Conversion  Rate (as defined  below).  The
Company  shall not  issue  any  fraction  of a share of  Common  Stock  upon any
conversion.  If the  issuance  would  result in the  issuance of a fraction of a
share of Common  Stock,  the  Company  shall  round such  fraction of a share of
Common Stock up or down, as applicable,  to the nearest whole share. The Company
shall pay any and all taxes that may be payable in respect of the  issuance  and
delivery of shares of Common Stock upon conversion of any Principal.

                  (b)  CONVERSION  RATE.  The  number of shares of Common  Stock
issuable upon conversion of any Conversion Amount pursuant to Section 3(a) shall
be determined by dividing (x) such Conversion Amount by (y) the Conversion Price
(the "CONVERSION RATE").

                        (i)  "CONVERSION   AMOUNT"  means  the  portion  of  the
Principal  to be  converted,  redeemed  or  otherwise  in  respect  of which the
applicable determination is being made.

                        (ii) "CONVERSION PRICE" means, as of any Conversion Date
(as defined  below) or other date of  determination,  $11.00 per share of Common
Stock after the  effectiveness  of the Reverse  Split  subject to  adjustment as
provided herein.


                                       3
<PAGE>

                  (c) MECHANICS OF CONVERSION.

                        (i)  OPTIONAL  CONVERSION.  To  convert  any  Conversion
Amount into shares of Common Stock on any date (a "CONVERSION DATE"), the Holder
shall (A) transmit by facsimile (or otherwise deliver),  for receipt on or prior
to 11:59 p.m.,  New York Time,  on such date,  a copy of an  executed  notice of
conversion in the form attached hereto as EXHIBIT I (the "CONVERSION NOTICE") to
the Company and (B) if required by Section  3(c)(iii),  surrender this Note to a
common  carrier  for  delivery  to the  Company  as  soon as  practicable  on or
following such date (or an  indemnification  undertaking in respect of this Note
in the case of its loss,  theft or  destruction).  On or before the second (2nd)
Trading Day  following the date of receipt of a Conversion  Notice,  the Company
shall transmit by facsimile a confirmation of receipt of such Conversion  Notice
to the Holder and the Company's  transfer  agent (the "TRANSFER  AGENT"),  which
confirmation  shall  constitute an  instruction to the Transfer Agent to process
such Conversion  Notice in accordance with the terms herein (the "SHARE DELIVERY
DATE"),  and (X)  provided  that  the  Transfer  Agent is  participating  in the
Depository Trust Company ("DTC") Fast Automated Securities Transfer Program, the
applicable  registration  statement is effective under the 1933 Act and provided
that the Holder is  eligible  to receive  shares of Common  Stock  through  DTC,
credit such aggregate number of shares of Common Stock to which the Holder shall
be entitled to the Holder's or its designee's  balance  account with DTC through
its Deposit  Withdrawal Agent Commission system, or (Y) if the Transfer Agent is
not participating in the DTC Fast Automated  Securities  Transfer Program or the
Holder is not eligible to receive  shares of Common Stock through DTC, issue and
deliver to the address as specified in the  Conversion  Notice,  a  certificate,
registered in the name of the Holder or its  designee,  for the number of shares
of Common Stock to which the Holder shall be entitled, pay to the Holder in cash
an amount equal to the accrued and unpaid  Interest and Late Charges (as defined
in Section  25(b)),  if any, on the  Conversion  Amount up to and  including the
Conversion  Date.  The Holder  undertakes  that  whenever  the  Company  credits
securities  as set forth in clause (1)(X) of the  preceding  sentence,  (A) upon
receipt of notice from the Company that the applicable registration statement is
not, or no longer is, effective in respect of the resale of such securities, the
Holder will not transfer such  securities  (other than (I) in connection  with a
transfer,  wherein  the  Holder  provides  ShellCo  with an  opinion  of counsel
reasonably  satisfactory  to ShellCo,  in a generally  acceptable  form,  to the
effect that such transfer may be made without  registration under the applicable
requirements  of the  1933  Act,  or  (II)  the  Holder  provides  ShellCo  with
assurances  reasonably  acceptable  to ShellCo that the transfer may be effected
pursuant to Rule 144 or Rule 144) until the Company notifies the Holder that the
applicable  registration statement becomes effective (again), and (B) the Holder
shall  indemnify and hold the Company  harmless  against any claim of securities
laws  violations  in respect  of the  transfer  (after the  receipt of the first
notice from the Company provided for in clause (A) of this sentence but prior to
the receipt of the second notice from the Company  provided for in clause (A) of
this  sentence) by the Holder of any security as to which such credit at DTC has
been effected. If this Note is physically surrendered for conversion as required
by Section 3(c)(iii) and the outstanding  Principal of this Note is greater than
the Principal  being  converted,  then the Company shall, as soon as practicable
and in no event later than three (3)  Business  Days after  receipt of this Note
(the "NOTE  DELIVERY  DATE")and  at its own  expense,  issue and  deliver to the
holder  a  new  Note  (in  accordance  with  Section  18(d))   representing  the
outstanding  Principal not converted.  The Person or Persons entitled to receive
the shares of Common Stock issuable upon a conversion of this


                                       4
<PAGE>

Note shall be treated for all  purposes as the record  holder or holders of such
shares of Common Stock on the Conversion Date.

                        (ii) COMPANY'S FAILURE TO TIMELY CONVERT.

                        (A)  CONVERSION  FAILURE.   Subject  to  the  terms  and
      conditions  of this Note, if the Company shall fail to issue a certificate
      to the  Holder or credit the  Holder's  balance  account  with DTC for the
      number  of shares of Common  Stock to which the  Holder is  entitled  upon
      conversion of any Conversion Amount on or prior to the date which is three
      (3) Trading Days after the Conversion Date (a "CONVERSION  FAILURE"),  and
      if on or after such  Trading Day the Holder  purchases  (in an open market
      transaction  or otherwise)  Common Stock to deliver in  satisfaction  of a
      sale by the Holder of Common Stock issuable upon such  conversion that the
      Holder  anticipated  receiving  from the Company (a  "BUY-IN"),  then,  in
      addition to all other remedies available to the Holder, the Company shall,
      within  three (3)  Business  Days after the  Holder's  request  and in the
      Holder's discretion,  either (i) pay cash to the Holder in an amount equal
      to the Holder's total purchase price  (including  reasonable out of pocket
      brokerage  commissions,  and other reasonable  out-of-pocket  expenses, if
      any) for the shares of Common Stock so purchased (the "BUY-IN PRICE"),  at
      which point the Company's  obligation to deliver such  certificate (and to
      issue such Common  Stock)  shall  terminate,  or (ii)  promptly  honor its
      obligation  to  deliver  to  the  Holder  a  certificate  or  certificates
      representing  such  Common  Stock and pay cash to the  Holder in an amount
      equal to the excess (if any) of the Buy-In  Price over the  product of (A)
      such number of shares of Common Stock,  times (B) the Closing Bid Price on
      the Conversion Date.

                        (B) NOTICE OF VOID CONVERSION;  ADJUSTMENT TO CONVERSION
      PRICE.  If for any reason the Holder has not received all of the shares of
      Common  Stock  prior to the  tenth  (10th)  Business  Day  after the Share
      Delivery Date in respect of a conversion  of this Note,  other than due to
      the pendency of a dispute being resolved in accordance  with Section 23 (a
      "CONVERSION  FAILURE"),  then  the  Holder,  upon  written  notice  to the
      Company,  may void its Conversion Notice in respect of, and retain or have
      returned,  as the case may be, any  portion of this Note that has not been
      converted pursuant to the Holder's Conversion Notice.

                        (iii)  BOOK-ENTRY.   Notwithstanding   anything  to  the
contrary  set forth  herein,  upon  conversion  of any  portion  of this Note in
accordance with the terms hereof, the Holder shall not be required to physically
surrender  this Note to the  Company  unless (A) all of the  Principal  is being
converted or (B) the Holder has provided the Company with prior  written  notice
(which notice may be included in a Conversion Notice)  requesting  reissuance of
this Note upon physical surrender of this Note. The Holder and the Company shall
maintain  records  showing the  Principal  converted  (and the Interest and Late
Charges paid in respect  thereof) and the dates of such conversions or shall use
such other method,  reasonably satisfactory to the Holder and the Company, so as
not to require physical surrender of this Note upon conversion.  Notwithstanding
the  foregoing,  if this Note is converted or redeemed as aforesaid,  the Holder
may not transfer this Note unless the Holder first  physically  surrenders  this
Note to the Company, whereupon the Company will forthwith issue and deliver upon
the order of the Holder a new Note of like tenor,  registered  as the Holder may
request, representing in the aggregate the


                                       5
<PAGE>

remaining  Principal  represented by this Note. The Holder and any assignee,  by
acceptance of this Note, acknowledge and agree that, by reason of the provisions
of this  paragraph,  following  conversion  or redemption of any portion of this
Note, the Principal of this Note may be less than the principal amount stated on
the face hereof.

                        (iv) PRO RATA  CONVERSION;  DISPUTES.  In the event that
the Company receives a Conversion  Notice from more than one holder of Notes for
the same  Conversion Date and the Company can convert some, but not all, of such
portions of the Notes submitted for conversion,  the Company, subject to Section
3(d),  shall convert from each holder of Notes electing to have Notes  converted
on such date a pro rata amount of such holder's  portion of its Notes  submitted
for conversion  based on the principal  amount of Notes submitted for conversion
on such date by such holder  relative to the aggregate  principal  amount of all
Notes submitted for conversion on such date. In the event of a dispute as to the
number of shares of Common  Stock  issuable to the Holder in  connection  with a
conversion  of this Note,  the  Company  shall issue to the Holder the number of
shares of Common  Stock not in dispute and resolve  such  dispute in  accordance
with Section 23.

                  (d) LIMITATIONS ON CONVERSIONS.

                        (i) BENEFICIAL  OWNERSHIP.  The Company shall not effect
any  conversion  of this  Note,  and the  Holder of this Note shall not have the
right to convert  any  portion of this Note  pursuant  to Section  3(a),  to the
extent that after giving effect to such  conversion,  the Holder  (together with
the Holder's affiliates) would beneficially own in excess of 9.99% (the "MAXIMUM
PERCENTAGE")  of the number of shares of Common  Stock  outstanding  immediately
after giving effect to such conversion;  PROVIDED,  HOWEVER,  that following the
Optional  Redemption  Notice  Date (as  defined  in  Section  8(a)) the  Maximum
Percentage  shall be of no further  force and effect on the Optional  Redemption
Date, solely for purposes of effecting a Optional Redemption pursuant to Section
8. For purposes of the foregoing  sentence,  the  aggregate  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 Note in
respect of 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 Note  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  Notes 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  3(d)(i),
beneficial ownership shall be calculated in accordance with Section 13(d) of the
Securities  Exchange Act of 1934, as amended (the "EXCHANGE  ACT"). For purposes
of this Section  3(d)(i),  in determining  the number of  outstanding  shares of
Common Stock, the Holder may rely on the number of outstanding  shares of Common
Stock as reflected in (x) the Company's most recent Form 10-K, Form 10-KSB, Form
10-Q,  Form  10-QSB or Form 8-K,  as the case may be, (y) a more  recent  public
announcement  by the  Company  or (z) any  other  notice by the  Company  or the
Transfer  Agent setting forth the number of shares of Common Stock  outstanding.
For any reason at any time, upon the written or oral request of the Holder,  the
Company  shall  promptly,  but in no event no later than two (2) Business  Days,
confirm orally and in writing to the Holder the number of shares of Common Stock
then outstanding. In any case,


                                       6
<PAGE>

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 Note, by the Holder or its affiliates  since the date as of which
such  number of  outstanding  shares of Common  Stock was  reported.  By written
notice  to the  Company,  the  Holder  may  increase  or  decrease  the  Maximum
Percentage  to any other  percentage  not in excess of 9.99%  specified  in such
notice;  provided  that (i) any such  increase  will not be effective  until the
sixty-first  (61st) day after such notice is delivered to the Company,  and (ii)
any such increase or decrease will apply only to the Holder and not to any other
holder of Notes.

                        (ii) PRINCIPAL MARKET REGULATION.  The Company shall not
be obligated to issue any shares of Common Stock upon  conversion  of this Note,
and the Holder of this Note shall not have the right to receive upon  conversion
of this Note any  shares of Common  Stock,  if the  issuance  of such  shares of
Common Stock would exceed the  aggregate  number of shares of Common Stock which
the Company may issue upon conversion or exercise,  as applicable,  of the Notes
and Warrants  without  breaching  the Company's  obligations  under the rules or
regulations of the applicable Eligible Market (the number of shares which may be
issued without violating such rules and regulations, the "EXCHANGE CAP"), except
that such  limitation  shall not apply in the event that the Company (A) obtains
the approval of its  stockholders  as required by the  applicable  rules of such
Eligible Market for issuances of shares of Common Stock in excess of such amount
(the  "STOCKHOLDER  APPROVAL")  or (B) obtains a written  opinion  from  outside
counsel to the Company that such approval is not  required,  which opinion shall
be  reasonably  satisfactory  to the  Required  Holders.  Unless  and until such
Stockholder  Approval or written opinion is obtained,  no purchaser of the Notes
pursuant to the Securities  Purchase  Agreement  (each, a "PURCHASER")  shall be
issued  in  the  aggregate,   upon  conversion  or  exercise  or  otherwise,  as
applicable,  of Notes or Warrants,  shares of Common Stock in an amount  greater
than the product of the Exchange Cap multiplied by a fraction,  the numerator of
which is the principal amount of Notes issued to such Purchaser  pursuant to the
Securities  Purchase  Agreement on the Closing Date and the denominator of which
is the aggregate principal amount of all Notes issued to the Purchasers pursuant
to the  Securities  Purchase  Agreement  on the Closing Date (in respect of each
Purchaser, the "EXCHANGE CAP ALLOCATION"). In the event that any Purchaser shall
sell or otherwise  transfer any of such Purchaser's  Notes, the transferee shall
be allocated a pro rata portion of such Purchaser's Exchange Cap Allocation, and
the restrictions of the prior sentence shall apply to such transferee in respect
of the portion of the Exchange Cap Allocation  allocated to such transferee.  In
the event that any holder of Notes shall convert all of such holder's Notes into
a number of shares of Common Stock which,  in the  aggregate,  is less than such
holder's  Exchange Cap  Allocation,  then the  difference  between such holder's
Exchange Cap Allocation and the number of shares of Common Stock actually issued
to such holder shall be allocated to the respective  Exchange Cap Allocations of
the  remaining  holders  of  Notes  on a pro rata  basis  in  proportion  to the
aggregate principal amount of the Notes then held by each such holder.


                                       7
<PAGE>

            (4) RIGHTS UPON EVENT OF DEFAULT.

                  (a)  EVENT OF  DEFAULT.  Each of the  following  events  shall
constitute an "EVENT OF DEFAULT":

                        (i) the failure of the applicable Registration Statement
required  to be  filed  pursuant  to the  Registration  Rights  Agreement  to be
declared  effective  by the SEC on or prior to the date that is sixty  (60) days
after the  applicable  Effectiveness  Deadline  (as defined in the  Registration
Rights Agreement),  or, while the applicable  Registration Statement is required
to be  maintained  effective  pursuant to the terms of the  Registration  Rights
Agreement, the effectiveness of the applicable Registration Statement lapses for
any reason (including,  without limitation,  the issuance of a stop order) or is
unavailable  to any  holder  of the  Notes  for  sale  of all of  such  holder's
Registrable  Securities  (as defined in the  Registration  Rights  Agreement) in
accordance with the terms of the Registration  Rights Agreement,  and such lapse
or  unavailability  continues for a period of ten (10)  consecutive  days or for
more than three  times in any 365-day  period  that does not exceed  thirty (30)
days in the aggregate  (other, in each case, than days during an Allowable Grace
Period or a  Maintenance  Grace  Period (as defined in the  Registration  Rights
Agreement));

                        (ii) the  suspension  from  trading  or  failure  of the
Common  Stock to be  listed  on an  Eligible  Market  for a  period  of five (5)
consecutive  Trading Days or for more than an aggregate of ten (10) Trading Days
in any 365-day period;

                        (iii) the  Company's  (A)  failure to cure a  Conversion
Failure by delivery,  subject to the Conversion Limitations set forth in Section
3(d),  of the  required  number of shares of Common  Stock  within  fifteen (15)
Business Days after the applicable  Conversion Date or (B) written notice to any
holder of the Notes,  including by way of public  announcement or through any of
its  agents,  at any time,  of its  intention  not to comply  with a request for
conversion  of any Notes  into  shares  of  Common  Stock  that is  tendered  in
accordance  with the  provisions  of the Notes,  other than  pursuant to Section
3(d);

                        (iv) after the  effectiveness  of the Reverse Split,  at
any time  following  the  twentieth  (20th)  consecutive  Business  Day that the
Holder's Authorized Share Allocation is less than the number of shares of Common
Stock that the Holder would be entitled to receive upon a conversion of the full
Conversion  Amount of this Note (without regard to any limitations on conversion
set forth in Section 3(d) or otherwise);

                        (v)  the  Company's  failure  to pay to the  Holder  any
amount of Principal  (including,  without limitation,  any redemption payments),
Interest,  Late Charges or other  amounts when and as due under this Note or any
other Transaction  Document (as defined in the Securities Purchase Agreement) or
any other  agreement,  document,  certificate or other  instrument  delivered in
connection with the  transactions  contemplated  hereby and thereby to which the
Holder is a party,  except, (A) in the case of a failure to pay Interest or Late
Charges  when and as due,  in which case only if such  failure  continues  for a
period of at least five (5) Business  Days and (B) if such payment is prohibited
by the  Intercreditor  Agreement  due  solely  to the  existence  of an Event of
Default occurring under any of the Senior Loan Documents


                                       8
<PAGE>

triggered  pursuant to the Intercreditor  Agreement or the Senior Loan Agreement
by the Holder's  breach of this Note or any  Transaction  Document to which such
Holder is a party;

                        (vi) the  Company's or any  Subsidiary's  failure to pay
any  principal of or interest or premium on any of its  Indebtedness  (excluding
Indebtedness  under the Senior  Loan and  Indebtedness  evidenced  by any of the
Notes),  to  the  extent  that  the  aggregate  principal  amount  of  all  such
Indebtedness  exceeds  $2,000,000,  when due  (whether  by  scheduled  maturity,
required prepayment,  acceleration,  demand or otherwise) and such failure shall
continue after the applicable grace period,  if any,  specified in the agreement
or  instrument  relating to such  Indebtedness,  or any other  default under any
agreement or instrument  relating to any such Indebtedness,  or any other event,
shall  occur and shall  continue  after the  applicable  grace  period,  if any,
specified  in such  agreement  or  instrument,  if the effect of such default or
event is to accelerate,  or to permit the  acceleration of, the maturity of such
Indebtedness;  or any such Indebtedness shall be declared to be due and payable,
or  required  to be  prepaid  (other  than  by a  regularly  scheduled  required
prepayment),  redeemed,  purchased  or defeased  or an offer to prepay,  redeem,
purchase or defease  such  Indebtedness  shall be  required to be made,  in each
case, prior to the stated maturity thereof, except, if such failure is caused by
the Holder's  breach of this Note or any of the  Transaction  Documents to which
such Holder is a party;

                        (vii) the Company or any of its  Subsidiaries  (A) shall
institute any  proceeding or voluntary case seeking to adjudicate it bankrupt or
insolvent,  or seeking  dissolution,  liquidation,  winding up,  reorganization,
arrangement,  adjustment,  protection,  relief or composition of it or its debts
under any law relating to bankruptcy,  insolvency,  reorganization  or relief of
debtors,  or seeking  the entry of an order for relief or the  appointment  of a
receiver, administrative receiver, administrator, trustee, custodian, liquidator
or other similar official for any such Person or for any substantial part of its
property, or any other Insolvency Proceeding,  (B) shall be generally not paying
its debts as such debts  become due or shall admit in writing its  inability  to
pay its debts  generally  or shall be unable to pay its debts,  (C) shall make a
general assignment for the benefit of creditors, or (D) shall take any action to
authorize or effect any of the actions set forth above in this subsection (vii);

                        (viii) any  proceeding  shall be instituted  against the
Company  or any  of its  Subsidiaries  seeking  to  adjudicate  it  bankrupt  or
insolvent,  or seeking  dissolution,  liquidation,  winding up,  reorganization,
arrangement,  adjustment, protection, relief of debtors, or seeking the entry of
an order for relief or the appointment of a receiver,  administrative  receiver,
administrator,  trustee, custodian, liquidator or other similar official for any
such Person or for any substantial part of its property, or any other Insolvency
Proceeding  shall be instituted  against the Company or any Subsidiary,  and any
such proceeding shall remain undismissed or unstayed for a period of thirty (30)
days  or any of the  actions  sought  in  such  proceeding  (including,  without
limitation,  the entry of an order for  relief  against  any such  Person or the
appointment  of a receiver,  administrative  receiver,  administrator,  trustee,
custodian,  liquidator or other similar  official for it or for any  substantial
part of its property) shall occur;

                        (ix) any provision of any Note, Security Document or the
Intercreditor  Agreement  or any other  security  document  entered into for the
benefit  of  the  Collateral  Agent  (as  defined  in  the  Securities  Purchase
Agreement)  or any  Holder,  after  delivery  thereof  pursuant  the  Securities
Purchase Agreement or any Note shall at any time for any reason


                                       9
<PAGE>

(other than pursuant to the express terms thereof) cease to be valid and binding
on or enforceable  against the Company or any Guarantor under the Guaranties (as
defined  in  the  Securities   Purchase  Agreement)  (each,  a  "GUARANTOR"  and
collectively,  the "GUARANTORS") intended to be a party thereto, or the validity
or  enforceability  thereof  shall  be  contested  by any  party  thereto,  or a
proceeding   shall  be  commenced  by  the  Company  or  any  Guarantor  or  any
Governmental  Authority  having  jurisdiction  over  any  of  them,  seeking  to
establish the invalidity or unenforceability  thereof, or any the Company or any
Guarantor  shall  deny  in  writing  that  it has any  liability  or  obligation
purported to be created under any Note or Security Document;

                        (x) the Security Agreement, the Intercreditor Agreement,
any Pledge  Agreement,  Guaranty (as each such term is defined in the Securities
Purchase  Agreement) or any other security document entered into for the benefit
of the Collateral Agent (as defined in the Securities Purchase Agreement) or any
Holder, after delivery thereof pursuant the Securities Purchase Agreement or any
Note,  shall for any reason fail or cease to create a valid and  perfected  and,
except to the extent  permitted by the terms hereof or thereof,  second priority
Lien  (subject  to  Permitted  Liens) in favor of the  Collateral  Agent for the
benefit of Holders on any Collateral purported to be covered thereby;

                        (xi) the loss,  suspension or revocation  of, or failure
to renew, any license or permit now held or hereafter acquired by the Company or
any Guarantor,  if such license or permit is not replaced with a similar license
or permit and, after giving effect to such replacement  license or permit,  such
loss,  suspension,  revocation  or failure to renew has or could  reasonably  be
expected to have a Material Adverse Effect;

                        (xii) the  indictment  of the  Company or any  Guarantor
under any criminal  statute,  or commencement  of criminal or civil  proceedings
against the Company or any  Guarantor,  pursuant to which statute or proceedings
the  penalties  or  remedies  sought  or  available  include  forfeiture  to any
Governmental Authority of any material portion of the property of such Person;

                        (xiii) a Change of Control shall have occurred;

                        (xiv) a breach, default, event of default or termination
shall  occur  under any  Acquisition  Document  (as  defined in the Senior  Loan
Agreement) or other Material  Contract  after giving effect to applicable  grace
periods,  if any,  contained in any such Acquisition  Document or other Material
Contract that gives any third party the right to terminate any such  Acquisition
Document  or other  Material  Contract or that  otherwise  could  reasonably  be
expected to have a Material Adverse Effect;

                        (xv)  one or more  final  judgments  or  orders  for the
payment of money is rendered against any the Company or any Subsidiary in excess
of $2,000,000 in the aggregate (provided that, any judgment covered by insurance
where the insurer has assumed  responsibility  in writing for such  judgment and
acknowledged  that the Company or Subsidiary,  as  applicable,  will receive the
proceeds of such  insurance  within thirty (30) days of the issuance of a final,
non-appealable judgment and execution thereon is effectively stayed shall not be
included in calculating such amount) and shall remain  undischarged or unvacated
for a period in excess of sixty (60) days or execution  shall at any time not be
effectively stayed, or any final


                                       10
<PAGE>

judgment  other  than for the  payment  of  money,  or  injunction,  attachment,
garnishment  or execution is rendered  against the Company or any  Subsidiary or
any of the  Collateral  having a value in excess of $2,000,000  and shall remain
undischarged or unvacated for a period in excess of sixty (60) days or execution
shall at any time not be effectively stayed;

                        (xvi) (A) Any  representation  or  warranty  made by the
Company or any  Subsidiary  herein (a)  containing a materiality  threshold,  is
incorrect or misleading  when made or (b) in respect of any such  representation
or  warranty  which  does  not  contain  a  materiality  threshold,  the same is
materially  misleading  or  materially  incorrect  when made or (B) the  Company
breaches any covenant  (other than the covenants set forth in Section 14 of this
Note) or other term or condition of any  Transaction  Document,  except,  in the
case of a breach of a covenant, term or condition which is curable, only if such
breach continues for a period of at least twenty (20) consecutive  Business Days
after notice thereof;

                        (xvii) any  breach or  failure in any  respect to comply
with  Section  14 of  this  Note,  Sections  6(e),  (g),  or (h)  of the  Pledge
Agreement,  or Sections 5(e)(i),  (g), or the first sentence of Section 5 (i) of
the Security Agreement;

                        (xviii)  any Event of Default  (as  defined in the Other
Notes) occurs in respect of any Other Note;

                        (xix)  the  occurrence  of any  acceleration  under  the
Senior Loan Documents in respect of Indebtedness outstanding thereunder;

                        (xx)  the  Company   and/or  any   Guarantor(s)   is/are
enjoined,  restrained  or in any way  prevented by the order of any court or any
Governmental  Authority from conducting all or any material part of its or their
business  for more  than ten (10) days  provided  that  such  curtailment  could
reasonably be expected to have a Material Adverse Effect;

                        (xxi)  any  material  damage  to,  or  loss,   theft  or
destruction of, any Collateral,  whether or not insured, or any strike, lockout,
labor  dispute,  embargo,  condemnation,  act of God or public  enemy,  or other
casualty which causes, for more than ten (10) days, the cessation or substantial
curtailment of revenue producing  activities at any facility of any Obligor,  if
any such event or  circumstance  has or could  reasonably  be expected to have a
Material Adverse Effect; or

                        (xxii)  any  cessation  of a  substantial  part  of  the
business  of the  Company  and/or  any  Guarantor(s)  for a period  which  could
reasonably be expected to have a Material Adverse Effect.

                  (b) REDEMPTION RIGHT. Upon the Company's  obtaining  knowledge
of the  occurrence  of an Event of  Default in respect of this Note or any Other
Note, the Company shall, as soon as possible,  but in any event,  within two (2)
Business  Days  thereafter  deliver  written  notice  thereof via  facsimile and
overnight  courier (an "EVENT OF DEFAULT NOTICE") to the Holder.  Subject to the
provisions of the Intercreditor  Agreement, at any time after the earlier of the
Holder's receipt of such Event of Default Notice and the Holder's becoming aware
of such an Event of  Default  in