**Exhibit 4.18**

 

*Execution Version*

 

NEITHER THIS SECURITY NOR THE SECURITIES INTOWHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANYSTATE 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 PURSUANTTO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCEWITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTIONWITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

UNLESS PERMITTED UNDER CANADIAN SECURITIES LEGISLATION,THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (I) [INSERT THEDISTRIBUTION DATE], AND (II) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY OF CANADA.

 

 

 

Original Issue Date: **January__, 2024**

Maturity Date: **January__, 2027**

 

Principal Amount: $  ̈

Loan Amount: $  ̈

 

**FORM OF SENIOR SECURED CONVERTIBLENOTE**

**DUE JANUARY__, 2027**

 

THIS SENIOR SECURED CONVERTIBLENOTE is a duly authorized and validly issued Convertible Promissory Note of Psyence Biomedical Ltd.,a corporation existing under the laws of Ontario, Canada (the “Company”), having its principal place of businessat ________________ designated as its Convertible Note due January__, 2027 (this “Note”).

 

FOR VALUE RECEIVED, theCompany promises to pay to [ ] or its registered assigns (collectively, the “Holder”), or shall have paid pursuantto the terms hereunder, the principal sum of U.S. $[ ], accrued Interest and other amounts due and payable unless prepaid earlier or converted,on January___, 2027, unless the Holder has given notice to the Company that it elects to accelerate the Maturity Date to the extent explicitlypermitted by this Note (the “Maturity Date”). In exchange for delivery of the Note on the Original Issuance Date referredto above, the Holder shall deliver U.S. $[ ] in United States dollars to the Company on the Original Issuance Date. The Holder’sallocation of principal and interest are set forth on Exhibit A hereto. This Note is subject to the following additional provisions:

 

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

 

“AttributionParties” shall have the meaning set forth in Section 5(f).

 

“BankruptcyEvent” 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 SignificantSubsidiary thereof (such law to include any applicable corporations legislation to the extent the relief sought thereunder relates toor involves the compromise, settlement, adjustment or arrangement of debt), (b) there is commenced against the Company or any SignificantSubsidiary thereof any such case or proceeding that is not dismissed within 60 days after commencement, (c) the Company or any SignificantSubsidiary thereof is adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or proceeding isentered, (d) the Company or any Significant Subsidiary thereof suffers any appointment of any custodian, monitor, trustee, receiver, receiver-manageror 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 anySignificant Subsidiary thereof calls a meeting of its creditors with a view to arranging a composition, adjustment or restructuring ofits debts, (g) the Company or any Significant Subsidiary thereof admits in writing that it is insolvent or generally unable to pay itsdebts as they become due, (h) the Company or any Significant Subsidiary thereof, by any act or failure to act, expressly indicates itsconsent to, approval of or acquiescence in any of the foregoing or takes any corporate or other action for the purpose of effecting anyof the foregoing.

 

 

 

“BeneficialOwnership Limitation” shall have the meaning set forth in Section 5(f).

 

“BusinessDay” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any dayon which commercial banking institutions in the State of New York are authorized or required by law or other governmental action to close.

 

“Buy-In”shall have the meaning set forth in Section 5(e)(v).

 

“Changeof Control Transaction” means the occurrence after the date hereof of any of the following: (a) an acquisition after the datehereof by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) ofeffective control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of in excessof 50% of the voting securities of the Company (other than by means of conversion or exercise of this Note and the Securities issued togetherwith this Note, (b) the Company merges into or consolidates with any other Person, or any Person merges into or consolidates with theCompany and, after giving effect to such transaction, the stockholders of the Company immediately prior to such transaction own less than50% of the aggregate voting power of the Company or the successor entity of such transaction, (c) the Company sells or transfers all orsubstantially all of its assets to another Person and the stockholders of the Company immediately prior to such transaction own less than50% of the aggregate voting power of the acquiring entity immediately after the transaction, (d) a replacement at one time or within atwo year period of more than one-half of the members of the Board of Directors which is not approved by a majority of those individualswho are members of the Board of Directors on the Original Issue Date (or by those individuals who are serving as members of the Boardof Directors on any date whose nomination to the Board of Directors was approved by a majority of the members of the Board of Directorswho 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 itis bound, providing for any of the events set forth in clauses (a) through (d) above. Notwithstanding the foregoing, the Business Combinationshall not be deemed to be a Change of Control Transaction for any purposes hereunder.

 

“CommonShares” means the common shares of the Company.

 

“ConversionDate” shall have the meaning set forth in Section 5(e)iii.

 

“ConversionFloor” means an amount equal to $1.00 until the First Reset Date, $0.50 until the Second Reset Date, and none thereafter.

 

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

 

“ConversionReset” means the reset of the Conversion Price at the following times and amounts:

 

(i) the fivetime downward adjustment of the Conversion Price on the following dates (i) the date that is five days prior to the date on which theRegistration Statement is declared effective (the “First Reset Date”), (ii) the three month anniversary of the closingof the Business Combination (the “Second Reset Date”), (iii) the six month anniversary of the closing of the BusinessCombination, (iv) the nine month anniversary of the closing of the Business Combination, and (v) the twelve month anniversary of the closingof the Business Combination, upon which times the Conversion Price shall be reset to the lower of (a) the Initial Conversion Price or(b) the average daily VWAP for the previous ten (10) Trading Days prior to such reset but in no event lower than the Conversion Floor;

 

 

 

(ii) in theevent that the Company sells, enters any agreement to sell or grants any right to reprice, or otherwise disposes of or issues (or announceany offer, sale, grant or any option to purchase or other disposition) any Common Shares or any securities of the Company or any of itssubsidiaries which would entitle the holder thereof to acquire or sell on behalf of the Company at any time Common Shares (including,without limitation, through conversion or other option rights (including pursuant to any debt, preferred stock, right, option, warrantor other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereofto receive Common Shares or other securities)) at an effective price per share less than the then existing Conversion Price, then theConversion Price shall be modified to equal such reduced price as of such date; provided that, such offering shall include, for the avoidanceof doubt, any Variable Rate Transaction or other registered offering or similar financing; or

 

(iii) in theevent that the Company shall fail for any reason to remain listed as a public company on The Nasdaq Stock Market LLC or on another nationalexchange, the Conversion Price shall be reset to the average daily VWAP of the five prior Trading Days and the Conversion Floor will beeliminated;

 

“ConversionShares” means, collectively, the Common Shares issuable upon conversion of this Note in accordance with the terms hereof.

 

“Eventof Default” shall have the meaning set forth in Section 6(a).

 

“FundamentalTransaction” means the occurrence after the date hereof of any of the following: (i) the Company, directly or indirectly, inone or more related transactions effects any merger, amalgamation, or consolidation of the Company with or into another Person, (ii) theCompany, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantiallyall of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchangeoffer (whether by the Company or another Person) is completed pursuant to which holders of Common Shares are permitted to sell, tenderor exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstandingCommon Shares, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganizationor recapitalization of the Common Shares or any compulsory share exchange pursuant to which the Common Shares is effectively convertedinto or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactionsconsummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization,spin-off or scheme of arrangement) with another Person whereby such other Person acquires more than 50% of the outstanding Common Shares(not including any Common Shares held by the other Person or other Persons making or party to, or associated or affiliated with the otherPersons making or party to, such stock or share purchase agreement or other business combination). Notwithstanding the foregoing, theBusiness Combination shall not be deemed to be a Fundamental Transaction for any purposes hereunder.

 

“Indebtedness”means: (a) all obligations for borrowed money; (b) all obligations evidenced by bonds, debentures, notes, or other similar instrumentsand all reimbursement or other obligations in respect of letters of credit, bankers acceptances, current swap agreements, interest ratehedging agreements, interest rate swaps, or other financial products; (c) all obligations or liabilities secured by a lien or encumbranceon any asset of the Company, irrespective of whether such obligation or liability is assumed; and (d) any obligation guaranteeing or intendedto guarantee (whether directly or indirectly guaranteed, endorsed, co-made, discounted or sold with recourse) any of the foregoing obligationsof any other person.

 

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

 

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

 

 

 

“MandatoryDefault Amount” means the (a) the outstanding principal amount of this Note, (b) accrued but unpaid Interest, and (c) all otheramounts, costs, expenses and liquidated damages due in respect of this Note.

 

“NewYork Courts” shall have the meaning set forth in Section 8(d).

 

“Note”means this Senior Secured Convertible Note;

 

“NoteRegister” means the ledger that records the record owners of the Notes as maintained by the Company.

 

“Noticeof Conversion” shall have the meaning set forth in Section 5(c)(ii).

 

“OriginalIssue Date” means the date of issuance of this Note.

 

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

 

“PurchaseAgreement” means the Securities Purchase Agreement, dated as of __, 2024 among, inter alios, the Company and the Purchaser,as amended, modified or supplemented from time to time in accordance with its terms.

 

“RegistrationRights Agreement” means the Registration Rights Agreement, dated as of the date hereof, among the Company and the original Purchaser,in the form of Exhibit B attached to the Purchase Agreement.

 

“RegistrationStatement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and coveringthe resale of the Underlyingi Shares for this Note and the Second Tranche Note (as such term is defined in the Purchase Agreement) byHolder as provided for in the Registration Rights Agreement.

 

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

 

“SecurityAgreement” means that certain General Security Agreement, dated as of [__________], 2024, from the Company and Psyence in favorof Purchaser.

 

“ShareDelivery Date” shall have the meaning set forth in Section 5(c)(iii).

 

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

 

“TradingMarket” means any of the following markets or exchanges on which the Common Shares is listed or quoted for trading on the datein question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York StockExchange, the OTCQB, or the OTCQX (or any successors to any of the foregoing).

 

“VariableRate Transactions” has the meaning contained in the Purchase Agreement.

 

“VWAP”means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Shares is then listedor quoted on a Trading Market, the daily volume weighted average price of the Common Shares for such date (or the nearest preceding date)on the Trading Market on which the Common Shares is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30a.m. (New York City time) to 4:02 p.m. (New York City time)); provided, however, that if the Common Shares is then listed or quoted onmore than one Trading Market, then the Trading Market for purposes of any calculations to be made pursuant to the terms of this Note shallbe the Trading Market selected by the Holder in its sole discretion, (b) if OTCQB or OTCQX is not a Trading Market, the volume weightedaverage price of the Common Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Sharesis not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Shares are then reported in the “Pink Sheets”published by OTC Markets, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recentbid price per share of the Common Shares so reported, or (d) in all other cases, the fair market value of a share of Common Shares asdetermined by an independent appraiser selected in good faith by the Purchasers of a majority in interest of the Securities then outstandingand reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

 

 

 

Section 2. Interest.

 

(a) Intereston this Note shall commence accruing on the Original Issuance Date at 8% per annum (the “Interest”) based on the outstandingprincipal amount of this Note and shall be computed on the basis of a 360-day year assuming a 30-day month (i.e. 30/360 basis) and shallbe payable by the Company to the Holder in cash or in Common Shares (at the Conversion Price) at the option of the Company. Interest shallbe payable monthly in arrears (each such date the interest payment is due, an “Interest Payment Date”).

 

(b) From andafter the occurrence of any Event of Default, the Interest rate shall automatically be increased to the lower of 20% per annum (the “DefaultInterest”) or the highest amount permitted by law, shall compound monthly, and shall be due and payable on the first TradingDay of each calendar month.

 

(c) For thepurposes of the Interest Act (Canada) and disclosure thereunder, whenever any interest or any fee to be paid hereunder or in connectionherewith is to be calculated on the basis of a 360-day or 365-day year, the yearly rate of interest to which the rate used in such calculationis equivalent is the rate so used multiplied by the actual number of days in the calendar year in which the same is to be ascertainedand divided by 360 or 365, as applicable. The rates of interest under this Note are nominal rates, and not effective rates or yields.The principle of deemed reinvestment of interest does not apply to any interest calculation under this Note.

 

(d) If any provisionof this Note would oblige the Company to make any payment of interest or other amount payable to the Holder in an amount or calculatedat a rate which would be prohibited by law or would result in a receipt by the Holder of “interest” at a “criminal rate”(as such terms are construed under the Criminal Code (Canada)), then, notwithstanding such provision, such amount or rate shall be deemedto have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibitedby applicable law or so result in a receipt by the Holder of “interest” at a “criminal rate”, such adjustmentto be effected, to the extent necessary (but only to the extent necessary), as follows:

 

(i) first, byreducing the amount or rate of interest; and

 

(ii) thereafter,by reducing any fees, commissions, costs, expenses, premiums and other amounts required to be paid which would constitute interest forpurposes of section 347 of the Criminal Code (Canada).

 

(e) All paymentsunder this Note or any other Transaction Document shall be made free and clear of and without deduction or withholding for any taxes exceptas required by applicable law; provided that if the payor shall be required to deduct or withhold any taxes from such payments, then thesum payable by the payor shall be increased as necessary so that, after making all required deductions or withholdings (including deductionsor withholdings applicable to additional sums payable under this clause) the Holder receives an amount equal to the sum it would havereceived had no such deduction or withholding been made.

 

Section 3. Reserved.

 

Section 4. Registrationof Transfers and Exchanges.

 

 a) DifferentDenominations. This Note is exchangeable for an equal aggregate principal amount of Notes of different authorized denominations, asrequested by the Holder surrendering the same. No service charge will be payable for such registration of transfer or exchange.

 

 

 

 b) InvestmentRepresentations. This Note has been issued subject to certain investment representations of the original Holder set forth in the PurchaseAgreement and may be transferred or exchanged only in compliance with the Purchase Agreement and applicable federal and state securitieslaws and regulations.

 

 c) Relianceon Note Register. Prior to due presentment for transfer to the Company of this Note, the Company and any agent of the Company maytreat the Person in whose name this Note is duly registered on the Note Register as the owner hereof for the purpose of receiving paymentas herein provided and for all other purposes, whether or not this Note is overdue, and neither the Company nor any such agent shall beaffected by notice to the contrary.

 

 Section 5. Conversion.

 

 a) ConversionPrivilege. The Holder shall have the right, at the Holder’s sole option, on any business day to convert all or any portion ofthe Note on any Conversion Date at the Conversion Price.

 

 b) ConversionPrice. The Conversion Price commencing on the first Trading Day following the closing of the Business Combination shall be $10.00;provided, however, that in the event that Holder and its Affiliates have not received at least the sum of Five Million Dollars ($5,000,000)as a return on its investment prior to the First Reset Date (including through the sale of Structuring Shares received pursuant to thePurchase Agreement), the Conversion Price shall be adjusted, at any time, to the lower of (i) $10.00 and (ii) the lowest daily VWAP duringthe period commencing on the First Tranche Closing date until the earlier of (i) the Conversion Date or (ii) First Reset Date (the “InitialConversion Price”); which Initial Conversion Price shall be subject to a Conversion Reset as set forth in this Note (as adjustedor reset, the “Conversion Price”).

 

c) Dividends;Stock Splits. If the Company, at any time while this Note is outstanding: (i) pays a share dividend or otherwise makes a distributionor distributions payable in Common Shares on Common Shares or any Common Share Equivalents (which, for avoidance of doubt, shall not includeany Common Shares issued by the Company upon conversion of, or payment of interest on, the Notes), (ii) subdivides outstanding CommonShares into a larger number of shares, (iii) combines (including by way of a reverse share split) outstanding Common Shares into a smallernumber of shares or (iv) issues, in the event of a reclassification of Common Shares, any shares of capital stock of the Company, thenthe Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of Common Shares (excluding any treasuryshares of the Company) outstanding immediately before such event, and of which the denominator shall be the number of Common Shares outstandingimmediately after such event. Any adjustment made pursuant to this Section shall become effective immediately after the record date forthe determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effectivedate in the case of a subdivision, combination or re-classification. Any adjustment pursuant to this Section 5(c) shall become effectiveimmediately after the effective date of such subdivision or combination. If any event requiring an adjustment under this Section 5(c)occurs during the period that a Conversion Price is calculated hereunder, then the calculation of such Conversion Price shall be adjustedappropriately to reflect such event.

 

d) Nothing hereinshall limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to Section 5 hereof and the Holdershall have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree ofspecific performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damagespursuant to any other Section hereof or under applicable law.

 

 e) Mechanicsof Conversion.

 

 i. ConversionShares Issuable Upon Conversion. The number of Conversion Shares issuable upon a conversion hereunder shall be determined by the quotientobtained by dividing (x) the outstanding principal amount of this Note to be converted, by the Conversion Price.

 

 

 

 ii. Noticeof Conversion. Before the Holder of the Note shall be entitled to convert all or any portion of the Note as set forth above, the Holdershall (1) complete, manually sign and deliver an irrevocable notice to the Company as set forth in the Form of Notice of Conversion (ora facsimile or electronic version thereof) in substantially the form attached hereto as Exhibit A (a “Notice of Conversion”)at the office of the Company, if applicable, and state in writing therein the principal amount of Notes to be converted, the numbers ConversionShares and the name or names (with addresses) in which the Holder wishes the Common Shares to be delivered upon settlement of the conversionto be registered, and (2) if required, pay all transfer or similar taxes, if any.

 

iii. Deliveryof Conversion Shares Upon Conversion. The Note shall be deemed to have been converted immediately prior to the close of business onany date (the “Conversion Date”) that the Holder has complied with the requirements set forth in subsection (ii) above.Not later than two (2) Business Days following the applicable conversion of the Note (the “Share Delivery Date”), theCompany shall electronically deliver, or cause to be delivered via DWAC transfer, to the Holder the Conversion Shares. The Company shalldeliver any Conversion Shares required to be delivered by the Company under this Section 5(c) electronically through the Depository TrustCompany or another established clearing corporation performing similar functions.

 

iv. ObligationAbsolute; Partial Liquidated Damages. The Company’s obligation to issue and deliver the Conversion Shares upon conversion ofthis Note in accordance with the terms hereof is absolute and unconditional, irrespective of any action or inaction by the Holder to enforcethe same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action toenforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder orany other Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person, andirrespective of any other circumstance which might otherwise limit such obligation of the Company to the Holder in connection with theissuance of such Conversion Shares; provided, however, that such delivery shall not operate as a waiver by the Company ofany such action the Company may have against the Holder. Upon the Closing, the Company may not refuse conversion based on any claim thatthe 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 Note shall havebeen sought and obtained, and the Company posts a surety bond for the benefit of the Holder in the amount of 150% the outstanding principalamount of this Note, which is subject to the injunction, which bond shall remain in effect until the completion of arbitration/litigationof the underlying dispute and the proceeds of which shall be payable to the Holder to the extent it obtains judgment. In the absence ofsuch injunction, the Company shall issue Conversion Shares or, if applicable, cash, upon a conversion. If the Company fails for any reasonto deliver to the Holder such Conversion Shares pursuant to Section 5(c)(iii) by the Share Delivery Date, the Company shall pay to theHolder, in cash, as liquidated damages and not as a penalty, for each $1,000 of principal amount being converted, $7 per Trading Day (increasingto $10 per Trading Day on the fifth (5th) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such ShareDelivery Date until such Conversion Shares are delivered or Holder rescinds such conversion. Nothing herein shall limit a Holder’sright to pursue actual damages or declare an Event of Default pursuant to Section 6 hereof for the Company’s failure to deliverConversion 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 suchrights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law.

 

v. Compensationfor 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 Share Delivery Date pursuant to Section 5(c)(iii),and if after such Share 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, Common Shares to deliver in satisfaction of a sale by the Holder of the ConversionShares which the Holder was entitled to receive upon the conversion relating to such Share 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 Common Shares so purchasedexceeds (y) the product of (1) the aggregate number of Common Shares that the Holder was entitled to receive from the conversion at issuemultiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokeragecommissions) and (B) at the option of the Holder, either reissue (if surrendered) this Note in a principal amount equal to the principalamount of the attempted conversion (in which case such conversion shall be deemed rescinded) or deliver to the Holder the number of CommonShares that would have been issued if the Company had timely complied with its delivery requirements under Section 5(c)(iii). For example,if the Holder purchases Common Shares having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversionof this Note with respect to which the actual sale price of the Conversion Shares (including any brokerage commissions) giving rise tosuch purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Company shall be requiredto pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respectof the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit the Holder’s rightto pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performanceand/or injunctive relief with respect to the Company’s failure to timely deliver Conversion Shares upon conversion of this Noteas required pursuant to the terms hereof.

 

 

 

 vi. Reservationof Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available out of its authorizedand unissued Common Shares for the sole purpose of issuance upon conversion of this Note, each as herein provided, free from preemptiverights or any other actual contingent purchase rights of Persons other than the Holder, not less than the greater of (i) 300% of suchaggregate number of shares of the Common Shares as shall (subject to the terms and conditions set forth in the Purchase Agreement) beissuable upon the conversion of the then outstanding principal amount of this Note assuming a minimum Conversion Price of $0.50 untilthe Second Reset Date and the actual Conversion Price thereafter, . The Company covenants that all Common Shares that shall be so issuableshall, upon issue, be duly authorized, validly issued, fully paid and nonassessable and, if the Registration Statement is then effectiveunder the Securities Act, shall be registered for public resale in accordance with such Registration Statement (subject to such Holder’scompliance with its obligations under the Registration Rights Agreement).

 

 vii FractionalShares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of all or any portionof this Note. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion, the Companyshall at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied bythe Conversion Price or Amortization Conversion Price, as applicable, or round up to the next whole share.

 

 viii. TransferTaxes and Expenses. The issuance of Conversion Shares on conversion of this Note shall be made without charge to the Holder hereoffor any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such Conversion Shares, providedthat the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and deliveryof any such Conversion Shares upon conversion in a name other than that of the Holder of this Note so converted and the Company shallnot be required to issue or deliver such Conversion Shares unless or until the Person or Persons requesting the issuance thereof shallhave 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.The Company shall pay 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.

 

 f) Holder’sConversion Limitations. The Company shall not effect any conversion of this Note to the extent that after giving effect to the conversion,the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the Holder or any of theHolder’s Affiliates (such Persons, “Attribution Parties”)) would beneficially own in excess of the BeneficialOwnership Limitation (as defined below). For purposes of the foregoing sentence, the number of Common Shares beneficially owned by theHolder and its Affiliates and Attribution Parties shall include all Common Shares beneficially owned by the Attribution Parties pursuantto the terms of the Purchase Agreement and the number of Common Shares issuable upon conversion of this Note with respect to which suchdetermination is being made, but shall exclude the number of Common Shares which are issuable upon (i) conversion of the remaining, unconvertedprincipal amount of this Note beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversionof the unexercised or unconverted portion of any other securities of the Company beneficially owned by the Holder or any of its Affiliatesor Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 5(d), beneficial ownership shall becalculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. To the extent thatthe limitation contained in this Section 5(d) applies, the determination of whether this Note is convertible (in relation to other securitiesowned by the Holder together with any Affiliates and Attribution Parties) and of which principal amount of this Note is convertible shallbe in the sole discretion of the Holder, and the submission of a Notice of Conversion shall be deemed to be the Holder’s determinationof whether this Note may be converted (in relation to other securities owned by the Holder together with any Affiliates or AttributionParties) and which principal amount of this Note is convertible, in each case subject to the Beneficial Ownership Limitation. To ensurecompliance with this restriction, the Holder will be deemed to represent to the Company that the conversion has not violated the restrictionsset forth in this paragraph 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 Actand the rules and regulations promulgated thereunder. For purposes of this Section 5(d), in determining the number of outstanding CommonShares, the Holder may rely on the number of outstanding Common Shares as stated in the most recent of the following: (i) the Company’smost recent periodic or annual report filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company,or (iii) a more recent written notice by the Company or the Company’s transfer agent setting forth the number of Common Shares outstanding.Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder thenumber of Common Shares then outstanding. In any case, the number of outstanding Common Shares shall be determined after giving effectto the conversion or exercise of securities of the Company, including this Note, by the Holder or its Affiliates since the date as ofwhich such number of outstanding Common Shares was reported. The “Beneficial Ownership Limitation” shall be 9.9% ofthe number of shares of the Common Shares outstanding immediately after giving effect to the issuance Common Shares issuable upon conversionof this Note held by the Holder. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strictconformity with the terms of this Section 5(d) to correct this paragraph (or any portion hereof) which may be defective or inconsistentwith the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properlygive effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Note.

 

 

 

g) Maintenanceof Office or Agency. The Company may maintain in the contiguous United States an office or agency where the Notes may be surrenderedfor registration of transfer or exchange or for presentation for payment or repurchase (“Paying Agent”).

 

h) Noticeto Holder. Whenever the Conversion Price is adjusted as a result of any Conversion Reset, the Company shall promptly deliver to theHolder by facsimile or email a notice setting forth the Conversion Price after such Company action or adjustment and any resulting adjustmentto the number of Conversion Shares and setting forth a brief statement of the facts requiring such adjustment.

 

i) Make Whole.If the VWAP (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)) for the thirty (30) TradingDays beginning on the Trading Date following a Conversion Date (the “30 Day VWAP”) is lower than the Conversion Priceon the Conversion Date, the Company shall make a payment in cash or Common Shares, at its election but subject to the limitations setforth below (the “Make Whole Payment”). In the event that the Company elects to make a Make Whole Payment in CommonShares, it shall transfer to the Holder the number of Common Shares (the “Make Whole Shares”) equal to the differencebetween (A) the principal amount converted on the Conversion Date divided by 30 Day VWAP and (B) principal amount converted divided bythe Conversion Price on the Conversion Date. In the event that the Company elects to pay the Make Whole Payment in cash it shall pay anamount equal to the number of Make Whole Shares multiplied by the 30 Day VWAP. The Company shall make the Make Whole Payment no laterthan thirty-five (35) Trading Days after the Conversion Date for which such payment is due. Notwithstanding the foregoing, the Companymay not pay the Make Whole Payment in Conversion Shares if the Make Whole Shares are not registered on an effective Registration Statement,unless waived in writing by the Holder or (ii) if the issuance of the Make Whole Shares would result in the Holder exceeding the BeneficialOwnership Limitation.

 

Section 6. Eventsof Default.

 

a) “Eventof Default” means, wherever used herein, any of the following events (whatever the reason for such event and whether such eventshall 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 defaultin the payment of (A) the principal amount of this Note or (B) liquidated damages and other amounts owing to the Holder on this Note,as and when the same shall become due and payable (whether on the Conversion Date or the Maturity Date or by acceleration or otherwise)which default, solely in the case of default under clause (B) above, is not cured within 10 Trading Days of delivery of a notice of thesame to the Company by the Holder;

 

ii. the Companyshall fail to observe or perform any other covenant, obligation, or agreement contained in this Note (other than a breach by the Companyof its obligations to deliver Common Shares to the Holder upon conversion, which breach is addressed in clause (xi) below) or in any TransactionDocument, which failure is not cured, if possible to cure, within the earlier to occur of (A) 5 Trading Days after notice of such failuresent 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 awareof such failure;

 

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

 

iv. the Companyor 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 Indebtednessfor borrowed money or money due under any long term leasing or factoring arrangement that (a) involves an obligation greater than $100,000,whether such Indebtedness now exists or shall hereafter be created, and (b) results in such Indebtedness becoming or being declared dueand payable prior to the date on which it would otherwise become due and payable;

 

v. other thanwith respect to the Business Combination, the Company shall be a party to any Change of Control Transaction or Fundamental Transactionor 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 (whetheror not such sale would constitute a Change of Control Transaction);

 

vi. the Companyshall fail for any reason to deliver Conversion Shares to the Holder by the Share Delivery Date pursuant to Section 5(c) or the Companyshall provide at any time notice to the Holder, including by way of public announcement, of the Company’s intention to not honora conversion of this Note in accordance with the terms hereof;

 

vii. the Companyshall fail for any reason to remain listed as a public company on The Nasdaq Stock Market LLC (“Nasdaq”);

 

viii. any monetaryjudgment, writ or similar final process shall be entered or filed against the Company, any Subsidiary or any of their respective propertyor other assets for more than $100,000, and such judgment, writ or similar final process shall remain unvacated, unbonded or unstayedfor a period of 45 calendar days;

 

 

 

ix. the Companyor a subsidiary enters into a Variable Rate Transaction or a similar transaction in violation of the terms of the Purchase Agreement withoutthe prior written consent of the Holder;

 

x. the Companyor its subsidiary, directly or indirectly, prepays, repurchases or declares or pays any cash dividend or distribution on any of its capitalstock without the prior written consent of the Holder;

 

xi. the Companyor its subsidiaries, suffer to exist any Lien on the Collateral other than the Lien granted pursuant to the Security Agreement or as otherwisepermitted under the terms of the Purchase Agreement;

 

xii. the Companyfails to cause the Registration Statement to become effective within three (3) months following the First Tranche Closing (as such termis defined in the Purchase Agreement);

 

xiii. the Companyshall have received a deficiency notice from Nasdaq or any other national securities exchange on which the Securities are listed whichhas not been resolved for more than sixty (60) days after notice thereof; or

 

xiv. the CommonShares cease to be listed on a national securities exchange, which for the avoidance of doubt shall exclude the OTCQB, the OTCQX and thePink markets (or any successors to any of the foregoing), or upon the filing of a Form 25.

 

 b) RemediesUpon Event of Default. If any Event of Default occurs, and upon the date specified by Purchaser in a written notice to be deliveredto the Company at Purchaser’s discretion, the outstanding principal amount of this Note, accrued but unpaid Interest through acceleration,plus liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the Holder’selection, immediately due and payable in cash at the Mandatory Default Amount. Additionally, Purchaser may pursue the rights and remediesprovided to Purchaser under the Security Agreement. Upon the payment in full of the Mandatory Default Amount, the Holder shall promptlysurrender this Note 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 withoutexpiration of any grace period enforce any and all of its rights and remedies hereunder and all other remedies available to it under applicablelaw. Such acceleration may be rescinded and annulled by Holder at any time prior to payment hereunder and the Holder shall have all rightsas a holder of the Note until such time, if any, as the Holder receives full payment pursuant to this Section 6(b). No such rescissionor annulment shall affect any subsequent Event of Default or impair any right consequent thereon.

 

Section 7. Prepayment.At any time following one (1) year after the Original Issue Date of the Note, and provided that no Event of Default has occurred and iscontinuing on the applicable prepayment date, but subject in all cases to the terms of the Purchase Agreement, the Company may repay anyportion of the outstanding principal amount of the Note upon at least thirty (30) Trading Days’ written notice (the “PrepaymentNotice Period”) of the Holder (the “Prepayment Notice”) by paying an amount equal to 130% of the principalamount of the Note then being prepaid (representing a 30% prepayment premium payable to the Holder which shall not constitute a principalrepayment) plus accrued but unpaid Interest through the prepayment date. Notwithstanding the foregoing, if the Company elects to prepaythis Note pursuant to the provisions of this Section 7, the Holder shall continue to have the right to exercise Holder’s conversionprivilege in accordance with Section 5 hereof.

 

Section 8. Miscellaneous.

 

 a) Notices.Any and all notices or other communications or deliveries to be provided by the Holder hereunder shall be in writing and delivered personally,by facsimile, by email attachment, or sent by a nationally recognized overnight courier service, addressed to the Company, at the addressset forth above, or such other facsimile number, email address, or address as the Company may specify for such purposes by notice to theHolder delivered in accordance with this Section 8(a). Any and all notices or other communications or deliveries to be provided by theCompany hereunder shall be in writing and delivered personally, by facsimile, by email attachment, or sent by a nationally recognizedovernight courier service addressed to Holder at the facsimile number, email address or address of the Holder appearing on the books ofthe Company, or if no such facsimile number or email attachment or address appears on the books of the Company, at the principal placeof business of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or deliveries hereunder shall bedeemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimileat the facsimile number or email attachment to the email address set forth on the signature pages attached hereto prior to 5:30 p.m. (NewYork City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered viafacsimile at the facsimile number or email attachment to the email address set forth on the signature pages attached hereto on a day thatis 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 dateof mailing, if sent by U.S. nationally recognized overnight courier service or (iv) upon actual receipt by the party to whom such noticeis required to be given.

 

 

 

 b) AbsoluteObligation. Except as expressly provided herein, no provision of this Note shall alter or impair the obligation of the Company, whichis absolute and unconditional, to pay the principal of and liquidated damages, as applicable, on this Note at the time, place, and rate,and in the coin or currency, herein prescribed. This Note is a direct debt obligation of the Company.

 

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

 

 d) GoverningLaw. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construedand 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 byany 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 “NewYork Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudicationof any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respectto the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action orproceeding, any claim that it is not personally subject to the jurisdiction of such New York Courts, or such New York Courts are improperor inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process beingserved in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidenceof delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute goodand sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serveprocess in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent permittedby applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Note or the transactionscontemplated hereby. If any party shall commence an action or proceeding to enforce any provisions of this Note, then the prevailing partyin such action or proceeding shall be reimbursed by the other party for its attorneys fees and other costs and expenses incurred in theinvestigation, preparation and prosecution of such action or proceeding.

 

 e) Amendment;Waiver. The provisions of this Note, including the provisions of this Section 8(e), may not be amended, modified or supplemented,and waivers or consents to departures from the provisions hereof may not be given, unless the same shall be in writing and signed by theCompany and the Holder. Any waiver by the Company or the Holder of a breach of any provision of this Note shall not operate as or be construedto be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Companyor the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprivethat party of the right thereafter to insist upon strict adherence to that term or any other term of this Note on any other occasion.

 

 

 

 f) Severability.If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provisionis inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances. The Companycovenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claimor take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company from payingall or any portion of the principal of this Note as contemplated herein, wherever enacted, now or at any time hereafter in force, or whichmay affect the covenants or the performance of this Note, and the Company (to the extent it may lawfully do so) hereby expressly waivesall benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the executionof 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) Executionand Counterparts. This Note may be executed in two or more counterparts, all of which when taken together shall be considered oneand the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, itbeing understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmissionor by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the partyexecuting (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signaturepage were an original thereof.

 

h) Successorsand Assigns. This Note shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the partiesand shall inure to the benefit of each such holder. Neither party may assign its rights or obligations hereunder without the prior writtenconsent of the other parties hereto.

 

 i) Remedies,Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Note shall be cumulative and inaddition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity (including a decreeof specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s right to pursue actual andconsequential damages for any failure by the Company to comply with the terms of this Note. The Company covenants to the Holder that thereshall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for hereinwith respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by the Holder andshall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). The Companyacknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law forany such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the Holdershall 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 informationand documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with theterms and conditions of this Note.

 

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

 

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

 

l). JudgmentCurrency. If, for the purposes of obtaining judgment in any court in any jurisdiction with respect to this Note or any other TransactionDocument, it becomes necessary to convert into a particular currency (the “Judgment Currency”) any amount due under this Noteor under any other Transaction Document in any currency other than the Judgment Currency (the “Currency Due”), then conversionshall be made at the rate of exchange prevailing on the Business Day before the day on which judgment is given. For this purpose “rateof exchange” means the rate at which the Holder is able, on the relevant date, to purchase the Currency Due with the Judgment Currencyin accordance with its normal practice. In the event that there is a change in the rate of exchange prevailing between the Business Daybefore the day on which the judgment is given and the date of receipt by the Holder of the amount due, the Company will, on the date ofreceipt by the Holder, pay such additional amounts, if any, or be entitled to receive reimbursement of such amount, if any, as may benecessary to ensure that the amount received by the Holder on such date is the amount in the Judgment Currency which when converted atthe rate of exchange prevailing on the date of receipt by the Holder is the amount then due under this Note or such other TransactionDocument in the Currency Due. If the amount of the Currency Due which the Holder is so able to purchase is less than the amount of theCurrency Due originally due to it, the Company shall indemnify and save the Holder harmless from and against all loss or damage arisingas a result of such deficiency. This indemnity shall constitute an obligation separate and independent from the other obligations containedin this Note and the other Transaction Documents, shall give rise to a separate and independent cause of action, shall apply irrespectiveof any indulgence granted by the Holder from time to time and shall continue in full force and effect notwithstanding any judgment ororder for a liquidated sum in respect of an amount due under this Note or any other Transaction Document or under any judgment or order.

 

 

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

 

*(Signature Pages Follow)*

 

 

 

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

 

 

 

 

 

 

** **

 

**Exhibit A**

 

[FORM OF NOTICE OF CONVERSION]

 

  

The undersigned registered ownerof this Note hereby exercises the option to convert this Note, or the portion hereof below designated, into Common Shares in accordancewith the terms of the Note, and directs that any cash payable and any Common Shares issuable and deliverable upon such conversion, togetherwith any cash for any fractional share, and any Notes representing any unconverted principal amount hereof, be issued and delivered tothe registered Holder hereof unless a different name has been indicated below. If any Common Shares or any portion of this Note not convertedare to be issued in the name of a Person other than the undersigned, the undersigned will pay all documentary, stamp or similar issueor transfer taxes, if any in accordance with Section 5(c)(viii) of the Note. Capitalized terms used herein but not defined shallhave the meanings ascribed to such terms in the Note.