Exhibit 10.2


 


EXHIBIT
A


 


NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND
THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.


 


Original
Issue Date: May 17, 2022


 


$2,100,000


 


CONVERTIBLE
DEBENTURE

DUE NOVEMBER 17, 2024


 


THIS
CONVERTIBLE DEBENTURE is one of a series of duly authorized and validly issued Convertible Debentures of Lion Group Holding Ltd., a Cayman
Islands exempted company (the “Company”), having its principal place of business at 3 Phillip Street, #15-04 Royal
Group Building, Singapore 048693, designated as its Convertible Debenture due November 17, 2024 (this debenture, the “Debenture”
and, collectively with the other debentures of such series, the “Debentures”).


 


FOR
VALUE RECEIVED, the Company promises to pay to ATW Opportunities Master Fund, L.P. or its registered assigns (the “Holder”),
or shall have paid pursuant to the terms hereunder, the principal sum of $2,100,000 on November 17, 2024 (the “Maturity
Date”) or such earlier date as this Debenture is required or permitted to be repaid as provided hereunder, and to pay
interest to the Holder on the aggregate unconverted and then outstanding principal amount of this Debenture in accordance with
the provisions hereof. This Debenture is subject to the following additional provisions:


 


Section
1. Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Debenture, (a) capitalized
terms not otherwise defined herein shall have the meanings set forth in the Purchase Agreement and (b) the following terms shall
have the following meanings:


 


“ADS
Delivery Date” shall have the meaning set forth in Section 4(c)(ii).


 






     


     


    

 


“Alternate
Consideration” shall have the meaning set forth in Section 5(e).


 


“Bankruptcy
Event” means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in
Rule 1-02(w) of Regulation S-X) thereof commences a case or other proceeding under any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the
Company or any Significant Subsidiary thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof
any such case or proceeding that is not dismissed within 60 days after commencement, (c) the Company or any Significant Subsidiary
thereof is adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or proceeding is entered,
(d) the Company or any Significant Subsidiary thereof suffers any appointment of any custodian or the like for it or any substantial
part of its property that is not discharged or stayed within 60 calendar days after such appointment, (e) the Company or any Significant
Subsidiary thereof makes a general assignment for the benefit of creditors, (f) the Company or any Significant Subsidiary thereof
calls a meeting of its creditors with a view to arranging a composition, adjustment or restructuring of its debts, (g) the Company
or any Significant Subsidiary thereof admits in writing that it is generally unable to pay its debts as they become due, (h) the
Company or any Significant Subsidiary thereof, by any act or failure to act, expressly indicates its consent to, approval of or
acquiescence in any of the foregoing or takes any corporate or other action for the purpose of effecting any of the foregoing.


 


“Base
Conversion Price” shall have the meaning set forth in Section 5(b).


 


“Beneficial
Ownership Limitation” shall have the meaning set forth in Section 4(d).


 


“Business
Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed
to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential
employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of
any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks
in The City of New York are generally are open for use by customers on such day.


 


“Buy-In”
shall have the meaning set forth in Section 4(c)(v).


 






    2


     


    

 


“Change
of Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date
hereof by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the
Exchange Act) of effective control (whether through legal or beneficial ownership of capital shares of the Company, by
contract or otherwise) of in excess of 33% of the voting securities of the Company (other than by means of conversion of the
Debentures and the Securities issued together with the Debentures), (b) the Company merges into or consolidates with any
other Person, or any Person merges into or consolidates with the Company and, after giving effect to such transaction, the
shareholders of the Company immediately prior to such transaction own less than 66% of the aggregate voting power of the
Company or the successor entity of such transaction, (c) the Company (and all of its Subsidiaries, taken as a whole) sells or
transfers all or substantially all of its assets to another Person and the shareholders of the Company immediately prior to
such transaction own less than 66% of the aggregate voting power of the acquiring entity immediately after the transaction,
(d) a replacement at one time or within a three year period of more than one-half of the members of the Board of Directors
which is not approved by a majority of those individuals who are members of the Board of Directors on the Original Issue Date
(or by those individuals who are serving as members of the Board of Directors on any date whose nomination to the Board of
Directors was approved by a majority of the members of the Board of Directors who are members on the date hereof), or (e) the
execution by the Company of an agreement to which the Company is a party or by which it is bound, providing for any of the
events set forth in clauses (a) through (d) above.


 


“Conversion”
shall have the meaning ascribed to such term in Section 4.


 


“Conversion
Date” shall have the meaning set forth in Section 4(a).


 


“Conversion
Price” shall have the meaning set forth in Section 4(b).


 


“Conversion
Schedule” means the Conversion Schedule in the form of Schedule 1 attached hereto.


 


“Conversion
Shares” means, collectively, the ADSs issuable upon conversion of this Debenture in accordance with the terms hereof.


 


“Debenture
Register” shall have the meaning set forth in Section 2(c).


 


“Dilutive
Issuance” shall have the meaning set forth in Section 5(b).


 


“Dilutive
Issuance Notice” shall have the meaning set forth in Section 5(b).


 






    3


     


    

 


“Equity
Conditions” means, during the period in question, (a) the Company shall have duly honored all conversions and
redemptions scheduled to occur or occurring by virtue of one or more Notices of Conversion of the Holder, if any, (b) the
Company shall have paid all liquidated damages and other amounts owing to the Holder in respect of this Debenture, (c) all of
the Conversion Shares issuable pursuant to the Transaction Documents (and shares issuable in lieu of cash payments of
interest) may be resold pursuant to Rule 144 without volume or manner-of-sale restrictions or current public information
requirements as determined by the counsel to the Company as set forth in a written opinion letter to such effect, addressed
and acceptable to the Depositary and the Holder, (d) the ADSs are trading on a Trading Market and all of the shares issuable
pursuant to the Transaction Documents are listed or quoted for trading on such Trading Market (and the Company believes, in
good faith, that trading of the ADSs on a Trading Market will continue uninterrupted for the foreseeable future), (e) there
is a sufficient number of authorized but unissued and otherwise unreserved Ordinary Shares for the issuance of all of the
ADSs then issuable pursuant to the Transaction Documents, (f) there is no existing Event of Default and no existing event
which, with the passage of time or the giving of notice, would constitute an Event of Default, (g) the issuance of the ADSs
in question to the Holder would not violate the limitations set forth in Section 4(d) herein, (h) there has been no public
announcement of a pending or proposed Fundamental Transaction or Change of Control Transaction that has not been consummated,
(i) the applicable Holder is not in possession of any information provided by the Company, any of its Subsidiaries, or any of
their officers, directors, employees, agents or Affiliates, that constitutes, or may constitute, material non-public
information and (j) for each Trading Day in a period of 20 consecutive Trading Days prior to the applicable date in question,
the daily trading volume for the ADSs on the principal Trading Market exceeds $100,000 per Trading Day.


 


“Event
of Default” shall have the meaning set forth in Section 8(a).


 


“Fundamental
Transaction” shall have the meaning set forth in Section 5(e).


 


“Interest
Conversion Rate” means the lesser of (a) the Conversion Price or (b) 90% of the lesser of (i) the average of the VWAPs
for the five (5) consecutive Trading Days ending on the Trading Day that is immediately prior to the applicable Interest Payment
Date or (ii) the average of the VWAPs for the five (5) consecutive Trading Days ending on the Trading Day that is immediately
prior to the date the applicable Interest Conversion Shares are issued and delivered if such delivery is after the Interest Payment
Date.


 


“Interest
Conversion Shares” shall have the meaning set forth in Section 2(a).


 


“Interest
Notice Period” shall have the meaning set forth in Section 2(a).


 


“Interest
Payment Date” shall have the meaning set forth in Section 2(a).


 


“Interest
ADS Amount” shall have the meaning set forth in Section 2(a).


 


“Late
Fees” shall have the meaning set forth in Section 2(d).


 


“Mandatory
Default Amount” means the sum of (a) the greater of (i) the outstanding principal amount of this Debenture, plus
all accrued and unpaid interest hereon, divided by the Conversion Price on the date the Mandatory Default Amount is either
(A) demanded (if demand or notice is required to create an Event of Default) or otherwise due or (B) paid in full, whichever
has a lower Conversion Price, multiplied by the VWAP on the date the Mandatory Default Amount is either (x) demanded or
otherwise due or (y) paid in full, whichever has a higher VWAP, or (ii) 125% of the outstanding principal amount of this
Debenture, plus 100% of accrued and unpaid interest hereon, and (b) all other amounts, costs, expenses and liquidated damages
due in respect of this Debenture.


 






    4


     


    

 


“New
York Courts” shall have the meaning set forth in Section 9(d).


 


“Notice
of Conversion” shall have the meaning set forth in Section 4(a).


 


“Original
Issue Date” means the date of the first issuance of the Debentures, regardless of any transfers of any Debenture and
regardless of the number of instruments which may be issued to evidence such Debentures.


 


“Permitted
Lien” means the individual and collective reference to the following: (a) Liens for taxes, assessments and other
governmental charges or levies not yet due or Liens for taxes, assessments and other governmental charges or levies being
contested in good faith and by appropriate proceedings for which adequate reserves (in the good faith judgment of the
management of the Company) have been established in accordance with GAAP, (b) Liens imposed by law which were incurred in the
ordinary course of the Company’s business, such as carriers’, warehousemen’s and mechanics’ Liens,
statutory landlords’ Liens, and other similar Liens arising in the ordinary course of the Company’s business, and
which (x) do not individually or in the aggregate materially detract from the value of such property or assets or materially
impair the use thereof in the operation of the business of the Company and its consolidated Subsidiaries or (y) are being
contested in good faith by appropriate proceedings, which proceedings have the effect of preventing for the foreseeable
future the forfeiture or sale of the property or asset subject to such Lien.


 


“Purchase
Agreement” means the Securities Purchase Agreement, dated as of May 17, 2022 among the Company and the original Holders,
as amended, modified or supplemented from time to time in accordance with its terms.


 


“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.


 


“Successor
Entity” shall have the meaning set forth in Section 5(e).


 


“Trading
Day” means a day on which the principal Trading Market is open for trading.


 


“Trading
Market” means any of the following markets or exchanges on which the ADSs are listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New
York Stock Exchange (or any successors to any of the foregoing).


 






    5


     


    

 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the ADSs are then
listed or quoted on a Trading Market, the daily volume weighted average price of the ADSs for such date (or the nearest
preceding date) on the Trading Market on which the ADSs are then listed or quoted as reported by Bloomberg L.P. (based on a
Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX
is not a Trading Market, the volume weighted average price of the ADSs for such date (or the nearest preceding date) on OTCQB
or OTCQX as applicable, (c) if the ADSs are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the
ADSs are then reported on The Pink Open Market (or a similar organization or agency succeeding to its functions of reporting
prices), the most recent bid price per share of ADS so reported, or (d) in all other cases, the fair market value of a share
of ADS as determined by an independent appraiser selected in good faith by the Purchasers of a majority in interest of the
Securities then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the
Company.


 


Section
2. Interest.


 


a) Payment
of Interest in Cash or Kind. The Company shall pay interest to the Holder on the aggregate unconverted and
then outstanding principal amount of this Debenture at the rate of 8.0% per annum to the extent such interest is paid in cash
or 12.0% to the extent such interest is paid in ADSs at the Company’s election, payable quarterly on January 1, April
1, July 1 and October 1, beginning on the first such date after the Original Issue Date, on each Conversion Date (as to that
principal amount then being converted) and on the Maturity Date (each such date, an “Interest Payment
Date”) (if any Interest Payment Date is not a Business Day, then the applicable payment shall be due on the next
succeeding Business Day), in cash or, at the Company’s option, in duly authorized, validly issued, fully paid and
non-assessable ADSs at the Interest Conversion Rate (the dollar amount to be paid in ADSs, the “Interest ADS
Amount”) or a combination thereof; provided, however, that payment of interest in ADSs may only occur
if (i) all of the Equity Conditions have been met (unless waived by the Holder in writing) during the 20 Trading Days
immediately prior to the applicable Interest Payment Date (the “Interest Notice Period”) and through and
including the date such ADSs are actually issued to the Holder, (ii) the Company shall have given the Holder notice in
accordance with the notice requirements set forth below and (iii) as to such Interest Payment Date, prior to such Interest
Notice Period (but not more than five (5) Trading Days prior to the commencement of such Interest Notice Period), the Company
shall have delivered to the Holder’s account with The Depository Trust Company a number of ADSs to be applied against
such Interest ADS Amount equal to the quotient of (x) the applicable Interest ADS Amount divided by (y) the lesser of the (i)
then Conversion Price and (ii) the Interest Conversion Rate assuming for such purposes that the Interest Payment Date is the
Trading Day immediately prior to the commencement of the Interest Notice Period (the “Interest
Conversion Shares”).


 






    6


     


    

 


b) Company’s
Election to Pay Interest in Cash or Kind. Subject to the terms and conditions herein, the decision whether to pay
interest hereunder in cash, ADSs or a combination thereof shall be at the sole discretion of the Company. Prior to
the commencement of any Interest Notice Period, the Company shall deliver to the Holder a written notice of its election to
pay interest hereunder on the applicable Interest Payment Date either in cash, ADSs or a combination thereof and the Interest
ADS Amount as to the applicable Interest Payment Date, provided that the Company may indicate in such notice that the
election contained in such notice shall apply to future Interest Payment Dates until revised by a subsequent notice. During
any Interest Notice Period, the Company’s election (whether specific to an Interest Payment Date or continuous) shall
be irrevocable as to such Interest Payment Date. Subject to the aforementioned conditions, failure to timely deliver such
written notice to the Holder shall be deemed an election by the Company to pay the interest on such Interest Payment Date in
cash. At any time the Company delivers a notice to the Holder of its election to pay the interest in ADSs, the Company shall
timely file a prospectus supplement pursuant to Rule 424 disclosing such election. The aggregate number of ADSs otherwise
issuable to the Holder on an Interest Payment Date shall be reduced by the number of Interest Conversion Shares previously
issued to the Holder in connection with such Interest Payment Date.


 


c)
Interest Calculations. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30 calendar day
periods, and shall accrue daily commencing on the Original Issue Date until payment in full of the outstanding principal, together
with all accrued and unpaid interest, liquidated damages and other amounts which may become due hereunder, has been made. Payment
of interest in ADSs (other than the Interest Conversion Shares issued prior to an Interest Notice Period) shall otherwise occur
pursuant to Section 4(c)(ii) herein and, solely for purposes of the payment of interest in shares, the Interest Payment Date shall
be deemed the Conversion Date. Interest shall cease to accrue with respect to any principal amount converted, provided that, the
Company actually delivers the Conversion Shares within the time period required by Section 4(c)(ii) herein. Interest hereunder
will be paid to the Person in whose name this Debenture is registered on the records of the Company regarding registration and
transfers of this Debenture (the “Debenture Register”). Except as otherwise provided herein, if at any time
the Company pays interest partially in cash and partially in Ordinary Shares to the holders of the Debentures, then such payment
of cash shall be distributed ratably among the holders of the then-outstanding Debentures based on their (or their predecessor’s)
initial purchases of Debentures pursuant to the Purchase Agreement.


 


d) Late
Fee. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate equal to
the lesser of 18% per annum or the maximum rate permitted by applicable law (the “Late Fees”) which
shall accrue daily from the date such interest is due hereunder through and including the date of actual payment in full.
Notwithstanding anything to the contrary contained herein, if, on any Interest Payment Date the Company has elected to pay
accrued interest in the form of ADSs but the Company is not permitted to pay accrued interest in ADSs because it fails to
satisfy the conditions for payment in ADSs set forth in Section 2(a) herein, then, at the option of the Holder, the Company,
in lieu of delivering either ADSs pursuant to this Section 2 or paying the regularly scheduled interest payment in cash,
shall deliver, within three (3) Trading Days of each applicable Interest Payment Date, an amount in cash equal to the product
of (x) the number of ADSs otherwise deliverable to the Holder in connection with the payment of interest due on such Interest
Payment Date multiplied by (y) the highest VWAP during the period commencing on the Interest Payment Date and ending on the
Trading Day prior to the date such payment is actually made. If any Interest Conversion Shares are issued to the Holder in
connection with an Interest Payment Date and are not applied against an Interest ADS Amount, then the Holder shall promptly
return such excess shares to the Company.


 






    7


     


    

 


e)
Prepayment. Except as otherwise set forth in this Debenture, the Company may not prepay any portion of the principal amount
of this Debenture without the prior written consent of the Holder.


 


f)
Interest Make-Whole. Upon the conversion of all of this Debenture prior to the Maturity Date, the Holder shall be entitled
to receive all interest which would have accrued on the principal amount being converted after the date of such conversion, in
any combination of cash or ADSs at the Company’s election and in accordance with the procedures set forth in Section 2(a)
(the “Make-Whole Payment”). Notwithstanding anything in Section 2(a) to the contrary, in the event all of this
Debenture is converted prior to the Maturity Date, the Company shall make the Make-Whole Payment within three (3) Trading Days
of such conversion. In addition to the foregoing, upon the partial conversion of this Debenture prior to the Maturity Date, the
Holder shall be entitled to receive all accrued and unpaid interest plus the interest which would have accrued on the principal
amount being converted after the date of such conversion, in any combination of cash or ADSs at the Company’s election and
in accordance with the procedures set forth in Section 2(a) (the “Partial Make-Whole Payment”). Notwithstanding
anything in Section 2(a) to the contrary, in the event a portion of this Debenture is converted prior to the Maturity Date, the
Company shall make the Partial Make-Whole Payment within three (3) Trading Days of such conversion. For example, if the Holder
converts $100,000 in principal amount of this Debenture on the five (5) month anniversary of the Original Issue Date, the Partial
Make Whole Payment shall equal to all accrued but unpaid interest and twenty-five (25) months of interest that would have accrued
on the converted principal had such principal not been converted prior to the Maturity Date.


 


Section
3. Registration of Transfers and Exchanges.


 


a)
Different Denominations. This Debenture is exchangeable for an equal aggregate principal amount of Debentures of different
authorized denominations, as requested by the Holder surrendering the same. No service charge will be payable for such registration
of transfer or exchange.


 


b)
Investment Representations. This Debenture has been issued subject to certain investment representations of the original
Holder set forth in the Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement
and applicable federal and state securities laws and regulations.


 


c) Reliance
on Debenture Register. Prior to due presentment for transfer to the Company of this Debenture, the Company and any agent
of the Company may treat the Person in whose name this Debenture is duly registered on the Debenture Register as the Person
in whose name this Debenture is duly registered on the Debenture Register as the owner hereof for the purpose of
receiving payment as herein provided and for all other purposes, whether or not this Debenture is overdue, and neither the
Company nor any such agent shall be affected by notice to the contrary.


 






    8


     


    

 


Section
4. Conversion.


 


a)
Voluntary Conversion. At any time after the Original Issue Date until this Debenture is no longer outstanding, this Debenture
shall be convertible, in whole or in part, into ADSs at the option of the Holder, at any time and from time to time (subject to
the conversion limitations set forth in Section 4(d) hereof). The Holder shall effect conversions by delivering to the Company
a Notice of Conversion, the form of which is attached hereto as Annex A (each, a “Notice of Conversion”),
specifying therein the principal amount of this Debenture to be converted and the date on which such conversion shall be effected
(such date, the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion
Date shall be the date that such Notice of Conversion is deemed delivered hereunder. No ink-original Notice of Conversion shall
be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Conversion form be
required. To effect conversions hereunder, the Holder shall not be required to physically surrender this Debenture to the Company
unless the entire principal amount of this Debenture, plus all accrued and unpaid interest thereon, has been so converted in which
case the Holder shall surrender this Debenture as promptly as is reasonably practicable after such conversion without delaying
the Company’s obligation to deliver the shares on the ADS Delivery Date. Conversions hereunder shall have the effect of
lowering the outstanding principal amount of this Debenture in an amount equal to the applicable conversion. The Holder and the
Company shall maintain records showing the principal amount(s) converted and the date of such conversion(s). The Company may deliver
an objection to any Notice of Conversion within one (1) Business Day of delivery of such Notice of Conversion. In the event of
any dispute or discrepancy, the records of the Holder shall be controlling and determinative in the absence of manifest error.
The Holder, and any assignee by acceptance of this Debenture, acknowledge and agree that, by reason of the provisions of this
paragraph, following conversion of a portion of this Debenture, the unpaid and unconverted principal amount of this Debenture
may be less than the amount stated on the face hereof.


 


b)
Conversion Price. The conversion price in effect on any Conversion Date shall be equal to the lesser of (i) $1.00 (the
“Fixed Conversion Price”) or (ii) 85% of the lowest trade price in the last ten (10) Trading Days immediately
prior to conversion, subject to adjustment herein (the “Conversion Price”). Notwithstanding the foregoing,
from the Initial Issue Date until the 183 day anniversary of the Initial Issue Date, the Conversion Price shall not be less than
$0.75 (as adjusted for reverse and forward stock splits, recapitalizations and similar transactions following the date hereof)
(the “Floor Price Period”). The Floor Price Period is subject to renewal or extension upon mutual agreement.


 






    9


     


    

 


c) Mechanics
of Conversion.




 


i. Conversion
Shares Issuable Upon Conversion of Principal Amount. The number of Conversion Shares issuable upon a conversion hereunder
shall be determined by the quotient obtained by dividing (x) the outstanding principal amount of this Debenture to
be converted by (y) the Conversion Price.


 


ii.
Delivery of Conversion Shares Upon Conversion. Not later than the earlier of (i) two (2) Trading Days and (ii) the number
of Trading Days comprising the Standard Settlement Period (as defined below) after each Conversion Date (the “ADS Delivery
Date”), the Company shall deliver, or cause to be delivered, to the Holder (A) the Conversion Shares which, on or after
the earlier of (i) the six month anniversary of the Original Issue Date or (ii) the Effective Date, shall be free of restrictive
legends and trading restrictions (other than those which may then be required by the Purchase Agreement) representing the number
of Conversion Shares being acquired upon the conversion of this Debenture (including, if the Company has given continuous notice
pursuant to Section 2(b) for payment of interest in ADSs at least 20 Trading Days prior to the date on which the Notice of Conversion
is delivered to the Company, ADSs representing the payment of accrued interest otherwise determined pursuant to Section 2(a) but
assuming that the Interest Notice Period is the 20 Trading Days period immediately prior to the date on which the Notice of Conversion
is delivered to the Company and excluding for such issuance the condition that the Company deliver Interest Conversion Shares
as to such interest payment prior to the commencement of the Interest Notice Period) and (B) a bank check in the amount of accrued
and unpaid interest (if the Company has elected or is required to pay accrued interest in cash). On or after the earlier of (i)
the six month anniversary of the Original Issue Date or (ii) the Effective Date, the Company shall deliver any Conversion Shares
required to be delivered by the Company under this Section 4(c) electronically through the Depository Trust Company or another
established clearing corporation performing similar functions. As used herein, “Standard Settlement Period”
means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with
respect to the ADSs as in effect on the date of delivery of the Notice of Conversion.


 


iii.
Failure to Deliver Conversion Shares. If, in the case of any Notice of Conversion, such Conversion Shares are not delivered
to or as directed by the applicable Holder by the ADS Delivery Date, the Holder shall be entitled to elect by written notice to
the Company at any time on or before its receipt of such Conversion Shares, to rescind such Conversion, in which event the Company
shall promptly return to the Holder any original Debenture delivered to the Company and the Holder shall promptly return to the
Company the Conversion Shares issued to such Holder pursuant to the rescinded Conversion Notice.


 






    10


     


    

 


iv.
Obligation Absolute; Partial Liquidated Damages. The Company’s obligations to issue and deliver the Conversion Shares
upon conversion of this Debenture in accordance with the terms hereof are absolute and unconditional, irrespective of any action
or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any
judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination,
or any breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged
violation of law by the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such
obligation of the Company to the Holder in connection with the issuance of such Conversion Shares; provided, however,
that such delivery shall not operate as a waiver by the Company of any such action the Company may have against the Holder. In
the event the Holder of this Debenture shall elect to convert any or all of the outstanding principal amount hereof, the Company
may not refuse conversion based on any claim that the Holder or anyone associated or affiliated with the Holder has been engaged
in any violation of law, agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining
and or enjoining conversion of all or part of this Debenture shall have been sought and obtained, and the Company posts a surety
bond for the benefit of the Holder in the amount of 150% of the outstanding principal amount of this Debenture, which is subject
to the injunction, which bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute
and the proceeds of which shall be payable to the Holder to the extent it obtains judgment. In the absence of such injunction,
the Company shall issue Conversion Shares or, if applicable, cash, upon a properly noticed conversion. If the Company fails for
any reason to deliver to the Holder such Conversion Shares pursuant to Section 4(c)(ii) by the second (2nd) Trading
Day following the ADS Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty,
for each $1,000 of principal amount being converted, $10 per Trading Day (increasing to $20 per Trading Day on the fifth (5th)
Trading Day after such liquidated damages begin to accrue) for each Trading Day after such ADS Delivery Date until such Conversion
Shares are delivered or Holder rescinds such conversion. Nothing herein shall limit a Holder’s right to pursue actual damages
or declare an Event of Default pursuant to Section 8 hereof for the Company’s failure to deliver Conversion Shares within
the period specified herein and the Holder shall have the right to pursue all remedies available to it hereunder, at law or in
equity including, without limitation, a decree of specific performance and/or injunctive relief. The exercise of any such rights
shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law.


 






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v.
Compensation for Buy-In on Failure to Timely Deliver Conversion Shares Upon Conversion. In addition to any other rights
available to the Holder, if the Company fails for any reason to deliver to the Holder such Conversion Shares by the second (2nd)
Trading Day following the ADS Delivery Date pursuant to Section 4(c)(ii), and if after such ADS Delivery Date the Holder is required
by its brokerage firm to purchase (in an open market transaction or otherwise), or the Holder’s brokerage firm otherwise
purchases, ADSs to deliver in satisfaction of a sale by the Holder of the Conversion Shares which the Holder was entitled to receive
upon the conversion relating to such ADS Delivery Date (a “Buy-In”), then the Company shall (A) pay in cash
to the Holder (in addition to any other remedies available to or elected by the Holder) the amount, if any, by which (x) the Holder’s
total purchase price (including any brokerage commissions) for the ADSs so purchased exceeds (y) the product of (1) the aggregate
number of ADSs that the Holder was entitled to receive from the conversion at issue multiplied by (2) the actual sale price at
which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the
option of the Holder, either reissue (if surrendered) this Debenture in a principal amount equal to the principal amount of the
attempted conversion (in which case such conversion shall be deemed rescinded) or deliver to the Holder the number of ADSs that
would have been issued if the Company had timely complied with its delivery requirements under Section 4(c)(ii). For example,
if the Holder purchases ADSs having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion
of this Debenture with respect to which the actual sale price of the Conversion Shares (including any brokerage commissions) giving
rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Company shall
be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the
Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit
a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation,
a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver Conversion
Shares upon conversion of this Debenture as required pursuant to the terms hereof.


 


vi.
Reservation of Ordinary Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep
available out of its authorized and unissued Ordinary Shares for the sole purpose of issuance upon conversion of this Debenture
and payment of interest on this Debenture, each as herein provided, free from preemptive rights or any other actual contingent
purchase rights of Persons other than the Holder (and the other holders of the Debentures), not less than such aggregate number
of Ordinary Shares as shall (subject to the terms and conditions set forth in the Purchase Agreement) required for the issuance
of the ADSs (taking into account the adjustments and restrictions of Section 5) upon the conversion of the then outstanding principal
amount of this Debenture and payment of interest hereunder. The Company covenants that all Ordinary Shares that shall be so issuable
shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable.


 






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vii.
Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of
this Debenture. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion, the
Company shall at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Conversion Price or round up to the next whole share.


 


viii.
Transfer Taxes and Expenses. The issuance of Conversion Shares on conversion of this Debenture shall be made without charge
to the Holder hereof for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such
Conversion Shares, provided that the Company shall not be required to pay any tax that may be payable in respect of any transfer
involved in the issuance and delivery of any such Conversion Shares upon conversion in a name other than that of the Holder of
this Debenture so converted and the Company shall not be required to issue or deliver such Conversion Shares unless or until the
Person or Persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established
to the satisfaction of the Company that such tax has been paid; provided further that the Holder shall pay any one-time initial
issuance fee charged by Deutsche Bank in an amount up to $0.03 per ADS. The Company shall pay all Depositary fees required for
same-day processing of any Notice of Conversion and all fees to the Depository Trust Company (or another established clearing
corporation performing similar functions) required for same-day electronic delivery of the Conversion Shares.


 


d)
Holder’s Conversion Limitations. The Company shall not effect any conversion of this Debenture, and a Holder shall
not have the right to convert any portion of this Debenture, to the extent that after giving effect to the conversion set forth
on the applicable Notice of Conversion, the Holder (together with the Holder’s Affiliates, and any other Persons acting
as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”))
would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence,
the number of Ordinary Shares beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number
of Ordinary Shares issuable upon conversion of this Debenture with respect to which such determination is being made, but shall
exclude the number of Ordinary Shares which would be issuable upon (i) conversion of the remaining, unconverted principal amount
of this Debenture beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion
of the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion or exercise
analogous to the limitation contained herein (including, without limitation, any other Debentures) beneficially owned by the Holder
or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 4(d),
beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. To the extent that the limitation contained in this Section 4(d) applies, the determination of whether this Debenture
is convertible (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and
of which principal amount of this Debenture is convertible shall be in the sole discretion of the Holder, and the submission of
a Notice of Conversion shall be deemed to be the Holder’s determination of whether this Debenture may be converted (in relation
to other securities owned by the Holder together with any Affiliates or Attribution Parties) and which principal amount of this
Debenture is convertible, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation
to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above
shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
For purposes of this Section 4(d), in determining the number of outstanding Ordinary Shares, the Holder may rely on the number
of outstanding Ordinary Shares as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission,
as the case may be, (B) a more recent public announcement by the Company, or (C) a more recent written notice by the Company or
the Company’s Depositary setting forth the number of Ordinary Shares outstanding. Upon the written or oral request of a
Holder, the Company shall within one (1) Trading Day confirm orally and in writing to the Holder the number of Ordinary Shares
then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion
or exercise of securities of the Company, including this Debenture, by the Holder or its Affiliates since the date as of which
such number of outstanding Ordinary Shares was reported. The “Beneficial Ownership Limitation” shall be 4.99%
of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of Ordinary Shares issuable upon
conversion of this Debenture. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation
provisions of this Section 4(d), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of
Ordinary Shares outstanding immediately after giving effect to the issuance of Ordinary Shares upon conversion of this Debenture
held by the Holder and the Beneficial Ownership Limitation provisions of this Section 4(d) shall continue to apply. Any increase
in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the
Company. The Beneficial Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 4(d) to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor
holder of this Debenture.


 






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Section
5. Certain Adjustments.


 


a) Stock
Dividends and Stock Splits. If the Company, at any time while this Debenture is outstanding: (i) pays a stock dividend or
otherwise makes a distribution or distributions payable in Ordinary Shares and/or ADSs on Ordinary Shares or any Ordinary
Shares Equivalents (which, for avoidance of doubt, shall not include any ADSs issued by the Company upon conversion of, or
payment of interest on, the Debentures), (ii) subdivides outstanding ADSs and/or Ordinary Shares into a larger
number of shares, (iii) combines (including by way of a reverse stock split) outstanding ADSs and/or
Ordinary Shares into a smaller number of shares or (iv) issues, in the event of a reclassification of Ordinary Shares, any
shares of capital stock of the Company, then the Fixed Conversion Price shall be multiplied by a fraction of which the
numerator shall be the number of Ordinary Shares (excluding any treasury shares of the Company) outstanding immediately
before such event, and of which the denominator shall be the number of Ordinary Shares outstanding immediately after such
event. Any adjustment made pursuant to this Section shall become effective immediately after the record date for the
determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after
the effective date in the case of a subdivision, combination or re-classification.


 


b) Subsequent
Equity Sales. If, at any time while this Debenture is outstanding, the Company or any Subsidiary, as applicable, sells or
grants any option to purchase or sells or grants any right to reprice, or otherwise disposes of or issues (or announces any
sale, grant or any option to purchase or other disposition), any ADSs, Ordinary Shares or Ordinary Shares Equivalents
entitling any Person to acquire ADSs or Ordinary Shares at an effective price per share that is lower than the then Fixed
Conversion Price (such lower price, the “Base Conversion Price” and such issuances, collectively, a
“Dilutive Issuance”) (if the holder of the ADSs, Ordinary Shares or Ordinary Shares Equivalents so issued
shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or
exchange prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such
issuance, be entitled to receive ADSs or Ordinary Shares at an effective price per share that is lower than the Fixed
Conversion Price, such issuance shall be deemed to have occurred for less than the Fixed Conversion Price on such date of the
Dilutive Issuance), then simultaneously with the consummation (or, if earlier, the announcement) of each Dilutive Issuance
the Fixed Conversion Price shall be reduced to equal the Base Conversion Price. Notwithstanding the foregoing, no adjustment
will be made under this Section 5(b) in respect of an Exempt Issuance. If the Company enters into a Variable Rate
Transaction, despite the prohibition set forth in the Purchase Agreement, the Company shall be deemed to have issued Ordinary
Shares or Ordinary Shares Equivalents at the lowest possible conversion price at which such securities may be converted or
exercised. The Company shall notify the Holder in writing, no later than the Trading Day following the issuance of any
Ordinary Shares and/or ADSs or Ordinary Shares Equivalents subject to this Section 5(b), indicating therein the applicable
issuance price, or applicable reset price, exchange price, conversion price and other pricing terms (such notice, the
“Dilutive Issuance Notice”). For purposes of clarification, whether or not the Company provides a
Dilutive Issuance Notice pursuant to this Section 5(b), upon the occurrence of any Dilutive Issuance, the Holder is entitled
to receive a number of Conversion Shares based upon the Base Conversion Price on or after the date of such Dilutive Issuance,
regardless of whether the Holder accurately refers to the Base Conversion Price in the Notice of Conversion.


 






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c)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 5(a) above, if at any time the Company
grants, issues or sells any Ordinary Shares Equivalents or rights to purchase shares, warrants, securities or other property pro
rata to the record holders of any class of Ordinary Shares (the “Purchase Rights”), then the Holder will be
entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have
acquired if the Holder had held the number of Ordinary Shares acquirable upon complete conversion of this Debenture (without regard
to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the
date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date
as of which the record holders of Ordinary Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided,
however, that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the
Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right
to such extent (or beneficial ownership of such Ordinary Shares as a result of such Purchase Right to such extent) and such Purchase
Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result
in the Holder exceeding the Beneficial Ownership Limitation).


 


d)
Pro Rata Distributions. During such time as this Debenture is outstanding, if the Company shall declare or make any distribution
of its assets (or rights to acquire its assets) to holders of Ordinary Shares, by way of return of capital or otherwise (including,
without limitation, any distribution of cash, shares or other securities, property or options by way of a dividend, spin off,
reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Debenture, then, in each such case, the Holder shall be entitled to participate in such
Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of Ordinary
Shares acquirable upon complete conversion of this Debenture (without regard to any limitations on conversion hereof, including
without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution,
or, if no such record is taken, the date as of which the record holders of shares of Ordinary Shares are to be determined for
the participation in such Distribution (provided, however, that, to the extent that the Holder’s right to
participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder
shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any Ordinary Shares
as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit
of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership
Limitation).


 






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e) Fundamental
Transaction. If, at any time while this Debenture is outstanding, (i) the Company, directly or indirectly, in one or more
related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company (and
all of its Subsidiaries, taken as a whole), directly or indirectly, effects any sale, lease, license, assignment,
transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related
transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or
another Person) is completed pursuant to which holders of ADSs and/or Ordinary Shares are permitted to sell, tender or
exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the
outstanding Ordinary Shares, (iv) the Company, directly or indirectly, in one or more related transactions effects any
reclassification, reorganization or recapitalization of the Ordinary Shares or any compulsory share exchange pursuant to
which the ADSs are effectively converted into or exchanged for other securities, cash or property, or (v) the Company,
directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business
combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement)
with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding ADSs
and/or Ordinary Shares (not including any Ordinary Shares held by the other Person or other Persons making or party to, or
associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business
combination) (each a “Fundamental Transaction”), then, upon any subsequent conversion of this Debenture,
the Holder shall have the right to receive, for each Conversion Share that would have been issuable upon such conversion
immediately prior to the occurrence of such Fundamental Transaction (without regard to any limitation in Section 4(d) on the
conversion of this Debenture), the number of Ordinary Shares of the successor or acquiring corporation or of the Company, if
it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of Ordinary Shares for which this Debenture
is convertible immediately prior to such Fundamental Transaction (without regard to any limitation in Section 4(d) on the
conversion of this Debenture). For purposes of any such conversion, the determination of the Conversion Price shall be
appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in
respect of one (1) Ordinary Share in such Fundamental Transaction, and the Company shall apportion the Conversion Price among
the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate
Consideration. If holders of Ordinary Shares are given any choice as to the securities, cash or property to be received in a
Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon
any conversion of this Debenture following such Fundamental Transaction. The Company shall cause any successor entity in a
Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in
writing all of the obligations of the Company under this Debenture and the other Transaction Documents (as defined in the
Purchase Agreement) in accordance with the provisions of this Section 5(e) pursuant to written agreements in form and
substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such
Fundamental Transaction and shall, at the option of the holder of this Debenture, deliver to the Holder in exchange for this
Debenture a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to
this Debenture which is convertible for a corresponding number of shares of capital stock of such Successor Entity (or its
parent entity) equivalent to the Ordinary Shares acquirable and receivable upon conversion of this Debenture (without regard
to any limitations on the conversion of this Debenture) prior to such Fundamental Transaction, and with a conversion
price which applies the conversion price hereunder to such shares of capital stock (but taking into account the relative
value of the Ordinary Shares pursuant to such Fundamental Transaction and the value of such shares of capital stock, such
number of shares of capital stock and such conversion price being for the purpose of protecting the economic value of this
Debenture immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in
form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed
to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Debenture
and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and
may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Debenture
and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company
herein.


 






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f)
Change in ADS Ratio. If, after the date of issuance, the ADS ratio is increased or reduced, then the number of Conversion
Shares to be provided on conversion of the Debentures will be reduced or increased (respectively) in inverse proportion to the
change in the ADS ratio of ADSs per ADS.


 


g)
Calculations. All calculations under this Section 5 shall be made to the nearest cent or the nearest 1/100th of a share,
as the case may be. For purposes of this Section 5, the number of Ordinary Shares deemed to be issued and outstanding as of a
given date shall be the sum of the number of Ordinary Shares (excluding any treasury shares of the Company) issued and outstanding.


 


 h) Notice to the Holder.




 


i.
Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 5,
the Company shall promptly deliver to each Holder a notice setting forth the Conversion Price after such adjustment and setting
forth a brief statement of the facts requiring such adjustment.


 


ii. Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form)
on the ADSs or Ordinary Shares, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the
Ordinary Shares, (C) the Company shall authorize the granting to all holders of the Ordinary Shares of rights or warrants to
subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any shareholders
of the Company shall be required in connection with any reclassification of the Ordinary Shares, any consolidation or merger
to which the Company(and all of its Subsidiaries, taken as a whole) is a party, any sale or transfer of all or substantially
all of the assets of the Company, or any compulsory share exchange whereby the ADSs are converted into other securities, cash
or property or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the
affairs of the Company, then, in each case, the Company shall cause to be filed at each office or agency maintained for the
purpose of conversion of this Debenture, and shall cause to be delivered to the Holder at its last address as it shall appear
upon the Debenture Register, at least twenty (20) calendar days prior to the applicable record or effective date hereinafter
specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution,
redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Ordinary Shares of
record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on
which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or
close, and the date as of which it is expected that holders of the Ordinary Shares of record shall be entitled to exchange
their Ordinary Shares for securities, cash or other property deliverable upon such reclassification, consolidation, merger,
sale, transfer or share exchange, provided that the failure to deliver such notice or any defect therein or in the delivery
thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any
notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any of the
Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 6-K.
The Holder shall remain entitled to convert this Debenture during the 20-day period commencing on the date of such notice
through the effective date of the event triggering such notice except as may otherwise be expressly set forth
herein.


 






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Section
6. Reserved.


 


Section
7. Negative Covenants. As long as any portion of this Debenture remains outstanding, unless the holders of at least
67% in principal amount of the then outstanding Debentures shall have otherwise given prior written consent, the Company shall
not, and shall not permit any of the Subsidiaries to, directly or indirectly:


 


a)
enter into, create, incur, assume, guarantee or suffer to exist any indebtedness for borrowed money of any kind, including, but
not limited to, a guarantee, on or with respect to any of its property or assets now owned or hereafter acquired or any interest
therein or any income or profits therefrom;


 


b)
other than Permitted Liens, enter into, create, incur, assume or suffer to exist any Liens of any kind, on or with respect to
any of its property or assets now owned or hereafter acquired or any interest therein or any income or profits therefrom;


 


c)
amend its charter documents, including, without limitation, its certificate of incorporation and bylaws, in any manner that materially
and adversely affects any rights of the Holder;


 


d)
repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of Ordinary Shares or
Ordinary Shares Equivalents other than as to (i) the Conversion Shares as permitted or required under the Transaction Documents
and (ii) repurchases of Ordinary Shares or Ordinary Shares Equivalents of departing officers and directors of the Company, provided
that such repurchases shall not exceed an aggregate of $100,000 for all officers and directors during the term of this Debenture;


 


e)
repay, repurchase or offer to repay, repurchase or otherwise acquire any Indebtedness, other than the Debentures if on a pro-rata
basis, other than regularly scheduled principal and interest payments as such terms are in effect as of the Original Issue Date,
provided that such payments shall not be permitted if, at such time, or after giving effect to such payment, any Event of Default
exist or occur;


 


f)
pay cash dividends or distributions on any equity securities of the Company;


 


g)
enter into any transaction with any Affiliate of the Company which would be required to be disclosed in any public filing with
the Commission, unless such transaction is made on an arm’s-length basis and expressly approved by a majority of the disinterested
directors of the Company (even if less than a quorum otherwise required for board approval);


 


h)
alter or change the rights, preferences or privileges of the Debentures as a class;




 


i)
approve the liquidation or dissolution of the Company or any Subsidiary; or


 


j) enter
into any agreement with respect to any of the foregoing.


 






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Section 8. Events of Default.


 


a)
“Event of Default” means, wherever used herein, any of the following events (whatever the reason for such event
and whether such event shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or
order of any court, or any order, rule or regulation of any administrative or governmental body):


 


i.
any default in the payment of (A) the principal amount of any Debenture or (B) interest, liquidated damages and other amounts
owing to a Holder on any Debenture, as and when the same shall become due and payable (whether on a Conversion Date or the Maturity
Date or by acceleration or otherwise) which default, solely in the case of an interest payment or other default under clause (B)
above, is not cured within three (3) Trading Days;


 


ii.
the Company shall fail to observe or perform any other covenant or agreement contained in the Debentures (other than a breach
by the Company of its obligations to deliver ADSs to the Holder upon conversion, which breach is addressed in clause (xi) below)
or in any Transaction Document, which failure is not cured, if possible to cure, within the earlier to occur of (A) 5 Trading
Days after notice of such failure sent by the Holder or by any other Holder to the Company and (B) 10 Trading Days after the Company
has become or should have become aware of such failure;


 


iii.
a default or event of default (subject to any grace or cure period provided in the applicable agreement, document or
instrument) shall occur under (A) any of the Transaction Documents or (B) any other material agreement, lease, document or
instrument to which the Company or any Subsidiary is obligated (and not covered by clause (vi) below);


 


iv.
any representation or warranty made in this Debenture, any other Transaction Documents, any written statement pursuant hereto
or thereto or any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be
untrue or incorrect in any material respect as of the date when made or deemed made;


 


v.
the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to a Bankruptcy
Event;


 


vi.
the Company or any Subsidiary shall default on any of its obligations under any mortgage, credit agreement or other facility,
indenture agreement, factoring agreement or other instrument under which there may be issued, or by which there may be secured
or evidenced, any indebtedness for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves
an obligation greater than $150,000, whether such indebtedness now exists or shall hereafter be created, and (b) results in such
indebtedness becoming or being declared due and payable prior to the date on which it would otherwise become due and payable;


 






    19


     


    

 


vii.
the ADSs shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume listing
or quotation for trading thereon within five Trading Days;


 


viii.
the Company (and all of its Subsidiaries, taken as a whole) shall be a party to any Change of Control Transaction or Fundamental
Transaction or shall agree to sell or dispose of all or in excess of 33% of its assets in one transaction or a series of related
transactions (whether or not such sale would constitute a Change of Control Transaction);


 


ix.
the Company shall fail for any reason to deliver Conversion Shares to a Holder prior to the fifth Trading Day after a Conversion
Date pursuant to Section 4(c) or the Company shall provide at any time notice to the Holder, including by way of public announcement,
of the Company’s intention to not honor requests for conversions of any Debentures in accordance with the terms hereof;


 


x.
any Person shall breach any agreement delivered to the initial Holders pursuant to Section 2.2 of the Purchase Agreement;


 


xi.
the electronic transfer by the Company of ADSs and/or Ordinary Shares through the Depository Trust Company or another established
clearing corporation is no longer available or is subject to a “chill”;


 


xii.
any monetary judgment, writ or similar final process shall be entered or filed against the Company, any subsidiary or any of their
respective property or other assets for more than $50,000, and such judgment, writ or similar final process shall remain unvacated,
unbonded or unstayed for a period of 45 calendar days; or


 


xiii.
a false or inaccurate certification (including a false or inaccurate deemed certification) by the Company that the Equity Conditions
are satisfied or that there has been no Equity Conditions Failure or as to whether any Event of Default has occurred.


 


b) Remedies
Upon Event of Default. If any Event of Default occurs, the outstanding principal amount of this Debenture, plus accrued
but unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration,
shall become, at the Holder’s election, immediately due and payable in cash at the Mandatory Default Amount. Commencing
five (5) days after the occurrence of any Event of Default that results in the eventual acceleration of this Debenture, the
interest rate on this Debenture shall accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate
permitted under applicable law. Upon the payment in full of the Mandatory Default Amount, the Holder shall promptly surrender
this Debenture to or as directed by the Company. In connection with such acceleration described herein, the Holder need not
provide, and the Company hereby waives, any presentment, demand, protest or other notice of any kind, and the Holder may
immediately and without expiration of any grace period enforce any and all of its rights and remedies hereunder and all other
remedies available to it under applicable law. Such acceleration may be rescinded and annulled by Holder at any time prior to
payment hereunder and the Holder shall have all rights as a holder of the Debenture until such time, if any, as the Holder
receives full payment pursuant to this Section 8(b). No such rescission or annulment shall affect any subsequent Event of
Default or impair any right consequent thereon.


 






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Section
9. Miscellaneous.


 


a)
Notices. Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without
limitation, any Notice of Conversion, shall be in writing and delivered personally, by email attachment, or sent by a nationally
recognized overnight courier service, addressed to the Company, at the address set forth above, or such other email address, or
address as the Company may specify for such purposes by notice to the Holder delivered in accordance with this Section 9(a). Any
and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered
personally, by email attachment, or sent by a nationally recognized overnight courier service addressed to each Holder at the
email address or address of the Holder appearing on the books of the Company, or if no such email attachment or address appears
on the books of the Company, at the principal place of business of such Holder, as set forth in the Purchase Agreement. Any notice
or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission,
if such notice or communication is delivered via email attachment to the email address set forth on the signature pages attached
hereto prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the date of transmission, if such
notice or communication is delivered via email attachment to the email address set forth on the signature pages attached hereto
on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day
following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (iv) upon actual receipt by
the party to whom such notice is required to be given.


 


b)
Absolute Obligation. Except as expressly provided herein, no provision of this Debenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable,
on this Debenture at the time, place, and rate, and in the coin or currency, herein prescribed. This Debenture is a direct debt
obligation of the Company. This Debenture ranks pari passu with all other Debentures now or hereafter issued under the
terms set forth herein.


 


c) Lost
or Mutilated Debenture. If this Debenture shall be mutilated, lost, stolen or destroyed, the Company shall execute and
deliver, in exchange and substitution for and upon cancellation of a mutilated Debenture, or in lieu of or in
substitution for a lost, stolen or destroyed Debenture, a new Debenture for the principal amount of this Debenture so
mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such Debenture,
and of the ownership hereof, reasonably satisfactory to the Company.


 






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d)
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Debenture shall
be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the
principles of conflict of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement
and defense of the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto or its
respective Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal courts
sitting in the City of New York, Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably
submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction
Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue for
such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence
of delivery) to such party at the address in effect for notices to it under this Debenture and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to
the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating
to this Debenture or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any
provisions of this Debenture, then the prevailing party in such action or proceeding shall be reimbursed by the other party for
its attorneys fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.


 


e)
Waiver. Any waiver by the Company or the Holder of a breach of any provision of this Debenture shall not operate as or
be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Debenture. The
failure of the Company or the Holder to insist upon strict adherence to any term of this Debenture on one or more occasions shall
not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other
term of this Debenture on any other occasion. Any waiver by the Company or the Holder must be in writing.


 






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f)
Severability. If any provision of this Debenture is invalid, illegal or unenforceable, the balance of this Debenture shall
remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable
to all other Persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates
the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the
maximum rate of interest permitted under applicable law. The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law or other law which would prohibit or forgive the Company from paying all or any portion of the principal
of or interest on this Debenture as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Debenture, and the Company (to the extent it may lawfully do so) hereby expressly
waives all benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or
impede the execution of any power herein granted to the Holder, but will suffer and permit the execution of every such as though
no such law has been enacted.


 


g)
Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Debenture
shall be cumulative and in addition to all other remedies available under this Debenture and any of the other Transaction Documents
at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit
the Holder’s right to pursue actual and consequential damages for any failure by the Company to comply with the terms of
this Debenture. The Company covenants to the Holder that there shall be no characterization concerning this instrument other than
as expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and
the computation thereof) shall be the amounts to be received by the Holder and shall not, except as expressly provided herein,
be subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of
its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate.
The Company therefore agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled, in addition
to all other available remedies, to an injunction restraining any such breach or any such threatened breach, without the necessity
of showing economic loss and without any bond or other security being required. The Company shall provide all information and
documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with
the terms and conditions of this Debenture.


 


h)
Next Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day.


 






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i)
 Headings. The headings contained herein are for convenience only, do not constitute a part of this Debenture and
shall not be deemed to limit or affect any of the provisions hereof.


 


Section
10. Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Debenture,
unless the Company has in good faith determined that the matters relating to such notice do not constitute material,
nonpublic information relating to the Company or its Subsidiaries, the Company shall within two (2) Business Days after such
receipt or delivery publicly disclose such material, nonpublic information on a Current Report on Form 6-K or otherwise. In
the event that the Company believes that a notice contains material, non-public information relating to the Company or its
Subsidiaries, the Company so shall indicate to the Holder contemporaneously with delivery of such notice, and in the absence
of any such indication, the Holder shall be allowed to presume that all matters relating to such notice do not constitute
material, nonpublic information relating to the Company or its Subsidiaries.


 


 


*********************


 


 


(Signature
Page Follows)


 






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IN
WITNESS WHEREOF, the Company has caused this Debenture to be duly executed by a duly authorized officer as of the date first above
indicated.


 


	 	LION GROUP HOLDING LTD.
	 	 	 
	 	By:	/s/ Chunning Wang
	 	 	Name: 	Chunning Wang
	 	 	Title: 	CEO and Director



 





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ANNEX
A


 


NOTICE
OF CONVERSION


 


The
undersigned hereby elects to convert principal under the Convertible Debenture due November ___, 2024 of Lion Group Holding
Ltd., a Cayman Islands exempted company (the “Company”), into ADSs of the Company according to the
conditions hereof, as of the date written below. If ADSs are to be issued in the name of a person other than the undersigned,
the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and
opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder for any
conversion, except for such transfer taxes, if any.


 


By
the delivery of this Notice of Conversion the undersigned represents and warrants to the Company that its ownership of the Ordinary
Shares does not exceed the amounts specified under Section 4 of this Debenture, as determined in accordance with Section 13(d)
of the Exchange Act.


 


The
undersigned agrees to comply with the prospectus delivery requirements under the applicable securities laws in connection with
any transfer of the aforesaid Ordinary Shares.


 


Conversion
calculations:


 


	 	Date
to Effect Conversion:


 


Principal
Amount of Debenture to be Converted:

 

Payment
of Interest in ADSs ____ yes ____ no


If
yes, $ _____of Interest Accrued on Account of Conversion at Issue.


 


Number
of Ordinary Shares to be issued:


 


Signature:

 

Name:


 


Address
for Delivery of ADSs:

 

Or


 


DWAC
Instructions:


 


Broker
No: ___________

  Account No:  ___________





 






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Schedule
1


 


CONVERSION
SCHEDULE


 


The
Convertible Debentures due on November ___, 2024 in the aggregate principal amount of $___________ are issued by Lion Group
Holding Ltd., a Cayman Islands exempted company. This Conversion Schedule reflects conversions made under Section 4 of the
above referenced Debenture.


 


Dated:


 


	Date
of Conversion

(or for first entry, Original Issue Date)
	Amount
of Conversion
	Aggregate
    Principal Amount Remaining Subsequent to Conversion

(or original Principal Amount)	Company
Attest

	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 



 




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