Preview | Class B Warrant Agreement |

CLASS B WARRANT AGREEMENT (Agreement), dated as of _____, 2006, by and between Elderwatch, Inc., a Florida corporation (the Company), and ________ (Warrantholder). Certain capitalized terms used herein are defined in Section 14 hereof.

In consideration of the mutual terms, conditions, representations, warranties and agreements herein set forth, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

The Company hereby issues and grants to Warrantholder ____ Class B Warrants (Warrants) to purchase one (1) share of common stock of the Company (the Common Stock) per each Warrant. Commencing on the date hereof (the Warrant Commencement Date), and terminating on June 30, 2009 (the Warrant Expiration Date), the holder shall have the right, subject to the satisfaction of the conditions to exercise set forth in Section 7 of this Agreement, to purchase one (1) share of Common Stock per each Warrant (the shares of Common Stock issuable upon exercise of the Warrants being collectively referred to herein as the Warrant Shares) at an exercise price of $0.30 per Warrant Share (the Exercise Price). The number of Warrant Shares issuable on exercise of each Warrant and the Exercise Price are all subject to adjustment pursuant to Section 8 of this Agreement.

Notwithstanding anything contained herein to the contrary, the Warrantholder agrees and acknowledges that at any time prior to its exercise of the Warrants in accordance with Section 7 below, the Company shall have the right, in its sole and absolute discretion, to redeem the Warrants, in whole or in part, at a redemption price of $0.05 per Warrant. In order to exercise such right, the Company shall send a notice to the Warrantholder along with the applicable redemption price (depending on the number of Warrants held by the Warrantholder that the Company is redeeming), whereupon said number of Warrants held by the Warrantholder shall be automatically terminated and have no further force and effect. The Company may exercise this redemption right as many times it desires prior to the Warrant Expiration Date.

Promptly after the execution and delivery of this Agreement by the parties hereto, the Company may, in its sole and absolute discretion, cause to be executed and delivered to Warrantholder one or more certificates evidencing the Warrants (the Warrant Certificates). Each Warrant Certificate delivered hereunder shall be substantially in the form set forth in Exhibit A attached hereto and may have such letters, numbers or other identification marks and legends, summaries or endorsements printed thereon as the Company may deem appropriate and that are not inconsistent with the terms of this Agreement or as may be required by applicable law, rule or regulation. Each Warrant Certificate shall be dated the date of execution by the Company.

Each Warrant Certificate delivered hereunder shall be signed on behalf of the Company by at least one of the following: its Chief Executive Officer, President, Vice President, Secretary or Assistant Secretary. Each such signature may be in the form of a facsimile thereof and may be imprinted or otherwise reproduced on the Warrant Certificates.

If any officer of the Company who signed any Warrant Certificate ceases to be an officer of the Company before the Warrant Certificate so signed shall have been delivered by the Company, such Warrant Certificate nevertheless may be delivered as though such person had not ceased to be such officer of the Company.