REVOLVING NOTE OF EP MEDSYSTEMS, INC., AND PROCATH CORPORATION

Exhibit 10.3

REVOLVING NOTE

OF

EP MEDSYSTEMS, INC.,

AND

PROCATH CORPORATION

FOR VALUE RECEIVED, each of the following (each of the following being hereinafter individually referred to as “Borrower” and both of the following being hereinafter collectively referred to as “Borrowers”), i.e.,

EP MEDSYSTEMS, INC., a New Jersey corporation bearing federal employer identification number 22 ###-###-#### and New Jersey state organizational number 0100541773 and having its principal place of business at 575 Route 73 North, Building D, West Berlin, Camden County, New Jersey 08091

and

PROCATH CORPORATION, a New Jersey corporation bearing federal employer identification number 22 ###-###-#### and New Jersey state organizational number 0100568383 and having its principal place of business at 575 Route 73 North, Building D, West Berlin, Camden County, New Jersey 08091

hereby JOINTLY AND SEVERALLY promises to pay to the order of KELTIC FINANCIAL PARTNERS, LP (“Lender”) at 580 White Plains Road, Suite 610, Tarrytown, New York 10591, or at such other place as Lender may from time to time in writing designate, the principal sum of each Advance made by Lender to Borrowers under that certain Revolving/Term Loan Agreement of even date herewith by and among Borrowers and Lender. Such certain Revolving/Term Loan Agreement and all extensions, modifications, amendments, restatements and replacements thereof hereafter made are collectively called the “Loan Agreement” in this Note.

The aggregate unpaid principal balance hereof shall not exceed at any time the sum of ONE MILLION FIVE HUNDRED THOUSAND DOLLARS and 00/100 ($1,500,000.00).

Capitalized terms used herein but not otherwise defined shall have the meanings set forth in the Loan Agreement.

The entire unpaid principal balance hereof, together with the accrued interest thereon and accrued late charges, if any, and all other sums due hereunder shall be due and payable on the Termination Date unless sooner paid or accelerated as provided herein.

Each Borrower also JOINTLY AND SEVERALLY promises to pay interest to Lender monthly, in arrears, on April 1, 2008 on the average daily unpaid principal balance of this Note at the rate set forth in Section 3.1 of the Loan Agreement.

This Note is the “Revolving Note” referred to in the Loan Agreement and in that certain General Security Agreement of even date herewith given by Borrowers in favor of Lender. Such certain General Security Agreement and all extensions, modifications, amendments, restatements and replacements thereof hereafter made are collectively called the “Security Agreement” in this Note. The Loan Agreement and the Security Agreement, together with all of the other documents, instruments or agreements executed in connection therewith, as the same may be extended, modified, amended, restated or replaced from time to time, are collectively called the “Loan Documents” in this Note. The Lender is entitled to the benefit of all of the terms and conditions and the security of all of the security interests and liens granted by Borrower or any other person to Lender pursuant to the Loan Agreement, the Security Agreement and/or any of the other Loan Documents executed in connection herewith or therewith, including, without limitation, supplemental provisions regarding mandatory and optional prepayment rights and premiums.

If any of the following occurs, a default (each an “Event of Default”) under this Note shall exist:

Upon the occurrence of any Event of Default, the entire unpaid principal amount owed to Lender hereunder shall, upon demand therefor, become immediately due and payable at the option of the holder hereof without further notice or demand and Lender shall have all of the rights and remedies set forth in the Loan Agreement, the Security Agreement, the other Loan Documents and at law and in equity.

Whenever any payment to be made under this Note shall be stated to be due on a day other than a Banking Day, such payment shall be made on the next succeeding Banking Day, and such extension of time shall be included in the computation of any interest then due and payable hereunder.

This Note shall be binding upon each Borrower’s successors and assigns. Lender shall have the right, without the necessity of any further consent or authorization by either Borrower to sell, assign, securitize or grant participations in all, or a portion of, Lender’s interest in this Note, to financial institutions of the Lender’s choice and on such terms as are acceptable to Lender in its sole discretion.

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Each Borrower and all other parties who, at any time, may be liable hereon in any capacity waive presentment, demand for payment, protest and notice of dishonor of this Note. This Note may not be changed orally, but only by an agreement in writing which is signed by the holder and the party or parties against whom enforcement of any waiver, change, modification or discharge is sought.

ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR EITHER BORROWER ARISING OUT OF OR RELATING TO THIS NOTE SHALL BE INSTITUTED IN THE SOLE OPTION OF LENDER IN ANY FEDERAL OR STATE COURT LOCATED IN WESTCHESTER COUNTY, NEW YORK, PURSUANT TO § 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND LENDER AND BORROWERS WAIVE ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND LENDER AND EACH BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. EACH BORROWER SHALL DESIGNATE FROM TIME TO TIME AN AUTHORIZED AGENT HAVING AN OFFICE IN THE STATE OF NEW YORK TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT LOCATED IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF PROCESS UPON SUCH AGENT AT SUCH ADDRESS AND WRITTEN NOTICE OF SUCH SERVICE ON SUCH BORROWER MAILED OR DELIVERED TO SUCH BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON SUCH BORROWER IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK. EACH BORROWER (1) SHALL GIVE PROMPT NOTICE TO LENDER OF ANY CHANGE OF ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (2) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH OFFICE SHALL BE DESIGNATED AS THE ADDRESS FOR SERVICE OF PROCESS), AND (3) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN WESTCHESTER COUNTY, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR. EACH BORROWER REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS CONSENT TO JURISDICTION PROVISION WITH ITS LEGAL COUNSEL, AND HAS MADE THIS WAIVER KNOWINGLY AND VOLUNTARILY.

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IN WITNESS WHEREOF, each Borrower has executed this Note the day and year first above written.

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