THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.  NO SUCH SALE OR DISTRIBUTION
MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO paltar nation Limited
Partnership THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF
1933.

SECURED CONVERTIBLE PROMISSORY NOTE

USD$584,000                                                                                                                                   

Dated: October 14, 2015
Effective: August 4, 2015
                                                                                                                      
  Denver, Colorado

For value received, PALTAR NATION LIMITED PARTNERSHIP, a Delaware limited
partnership (the “Partnership”), promises to pay to David N. Siegel Dynasty
Trust dated November 16, 2015 (the “Holder”), the principal sum of Five Hundred
Eighty-Four Thousand Dollars (USD$584,000). Interest shall accrue from the date
of this Secured Convertible Promissory Note (this “Note”) on the unpaid
principal amount hereunder at a rate equal to 10.00% per annum; provided, that
on and after the Maturity Date (as defined below) or an Event of Default (as
defined below), interest shall accrue from and after such date on the unpaid
principal and all accrued but unpaid interest of this Note at a rate equal to
15.00% per annum.  This Note is one of a number of promissory notes
(collectively, the “Notes”) issued under that certain Secured Convertible Note
Purchase Agreement initially dated as of August 4, 2015, by and among the
Partnership and the Purchasers listed on the signature pages thereto (the
“Purchase Agreement”).  This Note is subject to the following terms and
conditions:

1.            Maturity.  Unless converted as provided herein, all principal and
any accrued but unpaid interest under this Note shall be due and payable on
August 4, 2016 (the “Maturity Date”).  Subject to Section 2 below, interest
shall accrue on this Note and shall be due and payable in full on the Maturity
Date.  Notwithstanding the foregoing, the entire unpaid principal sum of this
Note, together with accrued and unpaid interest thereon, shall become
immediately due and payable upon a material breach by (a) the Partnership of
this Note, another Note or the Purchase Agreement, or (b) Wotan Group Limited,
an Australian limited company (ACN 14998651), of the Pledge Agreement (as
defined below), in each case that is not cured within thirty (30) days of such
breach (an “Event of Default”).

2.            Conversion.

(a)           Qualified Financing.  Upon a sale of the Partnership’s limited
partnership interests (“Interests”) in a single transaction or a series of
related transactions yielding gross cash proceeds to the Partnership of at least
$20,000,000 (including without limitation, this Note and any other Notes issued
under the Purchase Agreement) on or before the Maturity Date (a “Qualified
Financing”), the principal and any accrued but unpaid interest under this Note
shall automatically be converted into Interests upon the terms set forth in
Section 2(b) below.

(b)          Terms of Conversion.  The Interests to be issued to the Holder upon
a conversion pursuant to Section 2(a) shall be equal to the quotient obtained by
dividing (i) the entire principal amount of this Note plus any accrued but
unpaid interest under this Note by (ii) 80.00% of the per-Interest price of the
Interests sold to persons other than holders of Notes in a Qualified Financing. 
The issuance of such Interests upon such conversion shall be substantially upon
the same terms and subject to the same conditions applicable to the Qualified
Financing and the Partnership’s limited partnership agreement and other
documents governing such Qualified Financing.  Upon such conversion of this
Note, the Partnership and the Holder hereby agree to execute and deliver to each
other all transaction documents related to the Qualified Financing necessary to
effect the issuance of the Interests to the Holder.

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3.            Conversion Procedure.

                                                   (A)        CONVERSION.  IF
THIS NOTE IS CONVERTED PURSUANT TO SECTION 2(A), THE PARTNERSHIP SHALL GIVE
WRITTEN NOTICE TO THE HOLDER, NOTIFYING THE HOLDER OF THE CONVERSION TO BE
EFFECTED, THE APPLICABLE CONVERSION PRICE, THE AMOUNT OF PRINCIPAL AND ANY
ACCRUED BUT UNPAID INTEREST TO BE CONVERTED, THE INTERESTS TO BE ISSUED, THE
DATE ON WHICH SUCH CONVERSION IS EXPECTED TO OCCUR AND A REQUEST FOR SUCH HOLDER
TO PHYSICALLY SURRENDER THIS NOTE TO THE PARTNERSHIP.  UPON RECEIPT OF SUCH
NOTICE, THE HOLDER SHALL SURRENDER THIS NOTE AT THE PARTNERSHIP’S PRINCIPAL
EXECUTIVE OFFICE, OR, IF THIS NOTE HAS BEEN LOST, STOLEN, DESTROYED OR
MUTILATED, THEN, IN THE CASE OF LOSS, THEFT OR DESTRUCTION, THE HOLDER SHALL
DELIVER AN INDEMNITY AGREEMENT REASONABLY SATISFACTORY IN FORM AND SUBSTANCE TO
THE PARTNERSHIP OR, IN THE CASE OF MUTILATION, THE HOLDER SHALL SURRENDER AND
CANCEL THIS NOTE.  SUCH CONVERSION SHALL BE DEEMED TO HAVE BEEN MADE IN
CONNECTION WITH THE CLOSING OF THE QUALIFIED FINANCING, AND ON AND AFTER SUCH
DATE THE PERSON ENTITLED TO RECEIVE THE INTERESTS ISSUABLE UPON SUCH CONVERSION
SHALL BE TREATED FOR ALL PURPOSES AS THE RECORD HOLDER OF SUCH INTERESTS.

                                                  (B)        SAME RIGHTS.  UPON
CONVERSION OF THIS NOTE INTO INTERESTS, THE PARTNERSHIP SHALL ENSURE THAT THE
HOLDER IS GIVEN THE SAME RIGHTS WITH RESPECT TO SUCH INTERESTS AS THOSE GRANTED
TO THE SIMILARLY SITUATED PURCHASERS OF INTERESTS IN THE QUALIFIED FINANCING.

 

4.            Payment; Prepayment.  All payments hereunder shall be made in
lawful money of the United States of America at the Holder’s address on the
signature page attached hereto or at such other place as the Holder hereof may
from time to time designate in writing to the Partnership.  The Partnership may
prepay this Note at any time without penalty by providing all holders of the
Notes written notice of the Partnership’s intent to prepay the Notes, but
prepayment shall not occur without the prior written consent of the holders of a
majority of the aggregate outstanding principal amounts owed under all of the
Notes. Such prepayment shall be made on a pro rata basis based on the respective
aggregate outstanding amount of each Note to be prepaid.

5.            Security.  The Holder’s rights under this Note are secured by the
“Pledged Securities”, as defined in the Pledge Agreement, dated as of August
4, 2015, executed by Wotan Group Limited, an Australian limited company, in
favor of the Secured Parties (as defined therein) listed on the signature pages
thereto (including the Holder hereunder) (the “Pledge Agreement”).

6.            Transfer; Successors and Assigns.  The terms and conditions of
this Note shall inure to the benefit of and be binding upon the respective
successors and assigns of the Partnership and the Holder.  Notwithstanding the
foregoing, the Holder may not assign, pledge, or otherwise transfer this Note
without the prior written consent of the Partnership.  Subject to the preceding
sentence, this Note may be transferred only upon surrender of the original Note
(or an indemnity agreement if the Note is lost, stolen or destroyed) for
registration of transfer, duly endorsed, or accompanied by a duly executed
written instrument of transfer in form satisfactory to the Partnership. 
Thereupon, a new note for the same principal amount and interest will be issued
to, and registered in the name of, the transferee.  Interest and principal are
payable only to the registered holder of this Note.  The Partnership cannot
assign this Note or its obligations or rights hereunder without the approval of
the Holder.

7.            Governing Law.  This Note and all acts and transactions pursuant
hereto and the rights and obligations of the Partnership and the Holder shall be
governed, construed and interpreted in accordance with the laws of the state of
Delaware, without giving effect to principles of conflicts of law. 

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

 

8.            Notices.  All notices and other communications given or made
pursuant to this Note shall be in writing and shall be deemed effectively given
upon: (a) personal delivery to the party to be notified, (b) when sent, if
received by electronic mail or facsimile during normal business hours of the
recipient, and if not received during normal business hours, then on the
recipient’s next business day, (c) five (5) business days after having been sent
by registered or certified mail, return receipt requested, postage prepaid, or
(d) three (3) business days after deposit with a nationally recognized overnight
courier, freight prepaid, specifying next business day delivery, with written
verification of receipt.  All communications shall be sent to the respective
parties at their address as set forth on the signature pages to the Purchase
Agreement, or as subsequently modified by written notice.

9.            Amendments and Waivers.  Any term of this Note may be amended only
with the written consent of the Partnership and the holders of a majority of the
aggregate outstanding principal amount owed under all of the Notes; provided,
that the following terms cannot be amended without the consent of the holder of
this Note: a reduction in the interest rate, accrued interest or principal
amount owed on this Note or the convertibility price and/or discount of this
Note.

10.          Entire Agreement.  This Note, any Confidentiality Agreement between
the Partnership and a Purchaser, the Purchase Agreement, the Pledge Agreement
and the documents referred to herein and therein, constitute the entire
agreement between the Partnership and the Holder pertaining to the subject
matter hereof and thereof, and any and all other written or oral agreements
existing between the Partnership and the Holder are expressly canceled.

11.          Interest Rate Limitation.  Notwithstanding anything to the contrary
contained in this Note or the Purchase Agreement (the “Loan Documents”), the
interest paid or agreed to be paid under the Loan Documents shall not exceed the
maximum rate of non-usurious interest permitted by applicable law (the “Maximum
Rate”).  If the Holder shall receive interest in an amount that exceeds the
Maximum Rate, the excess interest shall be applied to the principal remaining
owed under this Note or, if it exceeds such unpaid principal, refunded to the
Partnership.  In determining whether the interest contracted for, charged, or
received by the Holder exceeds the Maximum Rate, the Holder may, to the extent
permitted by applicable law, (a) characterize any payment that is not principal
as an expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and
spread in equal or unequal parts the total amount of interest throughout the
contemplated term of this Note.

12.          Loss of Note.  Upon receipt by the Partnership of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Note and, in the case of loss, theft or destruction, delivery of an
indemnity agreement reasonably satisfactory in form and substance to the
Partnership or, in the case of mutilation, on surrender and cancellation of this
Note, the Partnership shall execute and deliver, in lieu of this Note, a new
Note executed in the same manner as this Note, in the same principal amount as
the unpaid principal amount of this Note and dated the date to which interest
shall have been paid on this Note or, if no interest shall have yet been so
paid, dated the date of this Note.

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the Partnership has executed this Secured Convertible
Promissory Note as of the date first set forth above.

the Partnership:

Paltar nation Limited partnership

By: /s/ Carmen J. Lotito                                  

                           (Signature)

Name: Carmen J. Lotito                                  

Title: Vice President                                        

AGREED TO AND ACCEPTED:

/s/ Robert Telles                                             

Trustee                                                           

David N. Siegel Dynasty Trust dated November 16, 2015

     

 

[Signature Page to Secured Convertible Promissory Note]