SETTLEMENT
        AGREEMENT
        AND MUTUAL RELEASE

      


      THIS
        SETTLEMENT AGREEMENT AND MUTUAL RELEASE
        (this
“Agreement”)
        is
        made and entered into as of this 23rd
        day of
        September, 2008 (the “Execution
        Date”),
        by
        and among Paul Guez and Elizabeth Guez (collectively the “Guezes”),
        The
        Paul and Beth Guez Living Trust (the “Trust”),
        Blue
        Concept, LLC, a California limited liability company (“Blue
        Concept”),
        Taverniti Holdings, LLC, a California limited liability company (“Taverniti
        Holdings”),
        Yanuk
        Jeans, LLC, a California limited liability company (“Yanuk
        Jeans”
and
        together with the Guezes, the Trust, Blue Concept and Taverniti Holdings,
        the
“Guez
        Parties”),
        and
        Blue Holdings, Inc., a Nevada corporation (together with any and all of its
        subsidiaries as appropriate, the “Company”).

       

      RECITALS

       

      A. Paul
        Guez
        serves as the Chairman of the Company’s Board of Directors (the “Board”).

       

      B. From
        time
        to time Paul Guez and Elizabeth Guez made advances to the Company to support
        its
        working capital needs. These advances were non-interest bearing and unsecured,
        with no formal terms of repayment. On July 1, 2006, the Company converted
        these
        advances to a line of credit in an agreement with Paul Guez which allows
        the
        Company to borrow from him up to a maximum of $3,000,000 at an interest rate
        of
        6% per annum (the “Revolving
        Line”).
        The
        Company may repay the advances in full or in part at any time until the
        Revolving Line expires and repayment is required on December 31,
        2008.

       

      C. Pursuant
        to that certain Common Stock Purchase Agreement dated March 5, 2008, between
        the
        Company and Paul Guez (the “Purchase
        Agreement”),
        Paul
        Guez cancelled $1,400,000 of indebtedness under the Revolving Line in
        consideration of the Company’s issuance of 1,750,000 shares (the “Conversion
        Shares”)
        of the
        Company’s common stock, par value $0.001 per share (“Common
        Stock”),
        to
        Paul Guez and Elizabeth Guez.

       

      D. Paul
        Guez
has
        informed the Company of his claims for sums he believes are due and owing
        to him
        pursuant to advances made to and payments made on behalf of the Company separate
        from the Revolving Line.
        The
        Company’s books and records reflect additional sums owed by Paul Guez to the
        Company. The Board has performed an investigation of these claims.

       

      E. Based
        on
        the foregoing, the parties
        desire to enter into a final and binding settlement with respect to all claims
        pursuant to which (i) the Company and Paul Guez will rescind the transactions
        under the Purchase Agreement, (ii) Paul Guez will cancel all amounts owed
        under
        the Revolving Line and the Company will issue a new note for certain amounts
        thereunder and (iii) Paul Guez and Elizabeth Guez will indemnify the Company
        for
        claims arising in connection with units of product shipped to the Company
        by
        Seven Licensing Co. LLC.

       

      F. As
        a
        material inducement to the Company’s execution of this Agreement, the parties
        further desire (with certain exceptions) to mutually
        release each other from claims existing as of the date of this Agreement
        on the
        terms set forth herein.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      AGREEMENT

       

      NOW,
        THEREFORE,
        in
        consideration of the premises, the parties hereto agree as follows:

       

      1. Definitions.

       

      1.1 “Affiliate”
means,
        with respect to any specified Person, any other Person who or which, directly
        or
        indirectly, controls, is controlled by, or is under common control with such
        specified Person where control (including with correlative meaning, controlled
        by and under common control with) as used with respect to any Person, means
        the
        possession, directly or indirectly, of the power to direct or cause the
        direction of the management and policies of such Person, through the ownership
        of voting securities, or by written contract, including, without limitation,
        any
        general partner, officer, director or manager of such Person.

       

      1.2 “Person”
means
        any individual, firm, corporation, company, partnership, trust, incorporated
        or
        unincorporated association, limited liability company, joint venture, joint
        stock company, government (or an agency or political subdivision thereof)
        or
        other entity of any kind, and shall include any successor (by merger or
        otherwise) of any such entity.

       

      2. Rescission
        of Purchase Agreement; Rescission of Rent Waiver.

       

      2.1 Effective
        as of March 5, 2008:

       

      2.1.1 The
        Parties hereby rescind and unwind the transactions consummated under the
        Purchase Agreement such that Paul Guez and Elizabeth Guez hereby transfer
        and
        assign to the Company all right, title and interest in and to the Conversion
        Shares, and relinquish all claims to ownership of the Conversion Shares and
        any
        and all rights therein, and the Company hereby transfers and assigns to Paul
        Guez all right, title and interest in and to the consideration paid by Paul
        Guez
        for the Conversion Shares consisting of indebtedness under the Revolving
        Line in
        the amount of $1,400,000, and such indebtedness is hereby reinstated under
        the
        Revolving Line; and

       

      2.1.2 The
        Purchase Agreement and the transactions consummated thereunder shall be deemed
        null and void and of no further force and effect.

       

      2.2 The
        foregoing rescission shall be effective so as to allow the Federal income
        tax
        doctrine of rescission to be applied thereto, and, each party acknowledges
        and
        agrees that it has been returned to its situation existing immediately prior
        to
        the consummation of the transactions contemplated by the Purchase
        Agreement.

       

      3. Settlement
        of Outstanding Indebtedness.

       

      3.1 The
        parties hereby agree and acknowledge that as of the Execution Date the Company’s
        total indebtedness to the Guez Parties and their Affiliates, other than the
        2008
        Amounts (defined below), consists of $1,618,093.15. For purposes hereof,
        the
“2008
        Amounts”
means
        $72,000 due to Paul and Elizabeth Guez for fiscal 2008 rental expense in
        connection with commercial space located at 1042 Princeton Drive, Marina
        Del
        Rey, CA 90292, and $197,005 due to Taverniti Holdings for fiscal 2008 royalties
        under the Taverniti So Jeans License Agreement executed May 1, 2004, between
        Taverniti Holdings and Taverniti So Jeans, LLC, a wholly-owned subsidiary
        of the
        Company.


      
        
          
          

        

        
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      3.2 The
        parties hereby further agree and acknowledge that as of the Execution Date
        Paul
        Guez, Elizabeth Guez and each of their Affiliates are not indebted to the
        Company.

       

      3.3 Effective
        as of the Execution Date, the $1,400,000 balance under the Revolving Line
        shall
        be terminated and cancelled (with the same effect as if the Company had repaid
        such balance), and the parties agree and acknowledge that the outstanding
        balance on the Revolving Line shall be $0.

       

      3.4 On
        the
        Execution Date, the Company shall issue to Paul Guez, in full satisfaction
        of
        all amounts owed to Paul Guez, Elizabeth Guez and their Affiliates as of
        the
        Execution Date, a new 8% Senior Convertible Note substantially in the form
        attached hereto as Exhibit A (the “Note”),
        in
        the principal amount of $1,618,093.15 bearing interest at the rate of 8%
        per
        annum. The Note shall be unsecured and shall be subordinated in payment to
        indebtedness held by FTC Commercial Corp. and Gemini Master Fund,
        Ltd.

       

      4. Indemnification.
        The
        Guezes hereby agree to indemnify and hold the Company and/or its Affiliates
        harmless from and against any and all liabilities, losses, damages, costs
        and
        expenses (including reasonable attorneys’ fees) based upon or in connection with
        any action or claim by Seven Licensing Co. LLC arising out of or in connection
        with units of product shipped from Seven Licensing Co. LLC to the Company
        and/or
        the Company’s Affiliates as of the Execution Date. The Company shall solely
        conduct the defense of any such claim or action and all negotiations for
        its
        settlement or compromise; provided, however, that no settlement or compromise
        affecting the financial obligations of the Guezes shall be entered into or
        agreed to without their prior approval (such approval not to be unreasonably
        withheld).

       

      5. Non-Admission
        of Wrongdoing.
        This
        Agreement shall not in any way be construed as an admission by any party
        hereto
        that it acted wrongfully with respect to any other party hereto, or any other
        person or entity.

       

      6. Mutual
        Release.

       

      6.1 Release
        by the Guez Parties.
        As a
        material inducement for the Company to enter into this Agreement, and as
        partial
        consideration for the Company’s obligations hereunder, each of the Guez Parties,
        individually and for and on behalf of each of their Affiliates (collectively
        the
“Guez
        Releasing Parties”),
        knowingly and voluntarily waive and release all rights and claims, known
        and
        unknown, which the Guez Releasing Parties may have against the Company, and/or
        any of the Company’s related or affiliated entities or successors, or any of
        their current or former parents,
        subsidiaries, partners, affiliates, shareholders, directors, officers,
        employees, agents, representatives, predecessors, successors or
        assigns
        (the
“Company
        Releasees”),
        including without limitation, any and all charges, complaints, claims,
        liabilities, obligations, promises, agreements, contracts, controversies,
        damages, actions, causes of action, suits, rights, demands, costs, losses,
        debts
        and expenses of any kind arising out of, resulting from or in any manner
        relating to the Guez Releasing Parties’ relationship with the Company up to the
        date of this Agreement or the parties’ entry into this Agreement. The Guezes
general
        release under this Agreement includes, but is not limited to, claims for
        employment discrimination, harassment, wrongful termination, constructive
        termination, violation of public policy, breach of any express or implied
        contract, breach of any implied covenant, fraud, intentional or negligent
        misrepresentation, emotional distress, defamation, libel, or any other claims
        relating to the Guez
        Releasing Parties’
        relationship with the Company. The
        Guez
        Releasing Parties are not releasing any claims (a) based on acts or events
        occurring after the signing of this Agreement, (b) to indemnification as
        a
        director or officer under or pursuant to the Company’s Articles of Incorporation
        or Bylaws, (c) to any rights to Directors’ and Officers’ insurance coverage, and
        (d) related to the 2008 Amounts. The
        matters that are the subject of the releases referred to in this Section
        6.1
        are
        referred to herein as the “Guez
        Released Matters.”


      
        
          
          

        

        
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      6.2 Release
        by the Company.
        As a
        material inducement for the Guezes to enter into this Agreement, and as partial
        consideration for the Guezes’ obligations hereunder, the Company, for and on
        behalf of itself and each of its Affiliates (collectively the “Company
        Releasing Parties”
and
        together with the Guez Releasing Parties, the “Releasing
        Parties”),
        knowingly and voluntarily waives and release all rights and claims, known
        and
        unknown, which the Company Releasing Parties may have against the Guez Releasing
        Parties, and/or any of their predecessors,
        successors or assigns
        (the
“Guez
        Releasees”
and
        together with the Company Releasees, the “Releasees”),
        including without limitation, any and all charges, complaints, claims,
        liabilities, obligations, promises, agreements, contracts, controversies,
        damages, actions, causes of action, suits, rights, demands, costs, losses,
        debts
        and expenses of any kind arising out of, resulting from or in any manner
        relating to the Guez Releasing Parties’ relationship with the Company up to the
        date of this Agreement or the parties’ entry into this Agreement. The Company
        Releasing Parties’ release
        under this Agreement includes, but is not limited to, claims for violation
        of
        public policy, breach of any express or implied contract, breach of any implied
        covenant, fraud, intentional or negligent misrepresentation, defamation,
        libel,
        or any other claims relating to the Guez
        Releasing Parties’
        relationship with the Company. The
        Company Releasing Parties are not releasing any claims based on acts or events
        occurring after the signing of this Agreement. The
        matters that are the subject of the releases referred to in this Section
        6.2
        are
        referred to herein as the “Company
        Released Matters.”
The
        Guez Released Matters and the Company Released Matters are hereinafter
        collectively referred to as the “Released
        Matters.”

       

      6.3 Unknown
        Claims.
        The
        parties acknowledge that there is a risk that subsequent to the execution
        of
        this Agreement, the Releasing Parties will incur or suffer damage, loss or
        injury to persons or property that is unknown or unanticipated at the time
        of
        the execution of this Agreement. The Releasing Parties hereby specifically
        assume such risk and agree that this Agreement and the releases contained
        herein
        shall and do apply to all unknown or unanticipated claims, as well as those
        currently known or anticipated. Accordingly, the Releasing Parties acknowledge
        that they have read the provisions of California Civil Code Section 1542,
        which
        provides as follows:

       

      “A
        general release does not extend to claims which the creditor does not know
        or
        suspect to exist in his or her favor at the time of executing the release,
        which
        if known by him or her must have materially affected his settlement with
        the
        debtor.”


      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      


      Notwithstanding
        the provisions of Section 1542, and for the purpose of implementing a full
        and
        complete release and discharge of the Releasees, the Releasing Parties expressly
        acknowledge that this Agreement is intended to include and does include in
        its
        effect, without limitation, all claims which the Releasing Parties do not
        know
        or suspect to exist in their favor against the Releasees with respect to
        the
        Released Matters, and
        that
        this Agreement contemplates the extinguishment of any such claim or
        claims.

      


      6.4 Assumption
        of Risk; Investigation of Facts.
        The
        Releasing Parties hereby expressly assume the risk of any mistake of fact
        or
        that the true facts might be other than or different from the facts now known
        or
        believed to exist, and it is the Releasing Parties’ express intention to forever
        settle, adjust and compromise any and all disputes between and among the
        Releasing
        Parties
        and the
        Releasees with respect to the Released Matters, finally and forever, and
        without
        regard to who may or may not have been correct in their respective
        understandings of the facts or the law relating thereto. In making and executing
        this Agreement, each Releasing Party jointly and severally represents and
        warrants, individually and on behalf of its Affiliates, that such parties
        have
        made such investigation of the facts and the law pertaining to the matters
        described in this Agreement as they deem necessary, and have not relied upon
        any
        statement or representation, oral or written, made by the Releasees with
        respect
        to any of the facts involved in any dispute or possible dispute between the
        parties hereto, or with respect to any of their rights or asserted rights,
        or
        with respect to the advisability of making and executing this
        Agreement.

       

      6.5 Ownership
        of Claims.
        Each
        Releasing Party jointly and severally represents and warrants, individually
        and
        on behalf of its Affiliates, that such
        parties have not assigned or transferred, or attempted to assign or transfer,
        to
        any person or entity, any of the Released Matters, as applicable.

       

      6.6 No
        Representations.
        Each
        party represents and agrees that no promises, statements or inducements have
        been made to such party that caused such party to sign this Agreement other
        than
        those expressly stated in this Agreement.

       

      7. Covenant
        Not to Sue.

       

      7.1 Each
        party agrees, individually and on behalf of its Affiliates, that they will
        not
        file or cause to be filed a lawsuit, administrative complaint or charge of
        any
        kind with any court, governmental or administrative agency or arbitrator
        against
        the other parties hereto, or any of their Affiliates,
        predecessors, successors or assigns,
        asserting any claims that are released in this Agreement.

       

      7.2 Each
        party hereto jointly and severally represents and warrants, individually
        and on
        behalf of its Affiliates, that before signing this Agreement they have not
        filed
        or pursued, or caused to be filed or pursued, any complaints, charges or
        lawsuits of any kind with any court, governmental or administrative agency
        or
        arbitrator against the other parties hereto or any of their
        Affiliates,
        predecessors, successors or assigns,
        asserting any claims that are released in this Agreement.


      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      


      8. Goodwill
        and Reputation of the Company and the Guezes.
        Each of
        the parties hereto further agrees not to take actions or make statements,
        written or oral, that disparage or defame the goodwill or reputation of any
        other party hereto, or any of their respective parents, subsidiaries, partners,
        affiliates, shareholders, directors, officers, employees, agents,
        representatives, predecessors, successors, assigns, heirs, executors or
        administrators.

       

      9. Attorney’s Fees.
        The
        losing party shall be liable to the prevailing party for its reasonable costs
        and attorney’s fees, including the costs of the arbitrator in any arbitration,
        incurred in any action to enforce this Agreement.

       

      10. Independent
        Counsel; Interpretation.
        EACH
        OF
        THE GUEZ PARTIES HEREBY EXPRESSLY REPRESENTS, ACKNOWLEDGES AND CONFIRMS,
        JOINTLY
        AND SEVERALLY, THAT STUBBS ALDERTON & MARKILES, LLP IS NOT REPRESENTING THE
        GUEZ PARTIES OR ANY OF THEIR AFFILIATES (OTHER THAN THE COMPANY), THAT HE/SHE/IT
        HAS BEEN ADVISED TO SEEK AND OBTAIN LEGAL ADVICE FROM INDEPENDENT COUNSEL
        REPRESENTING HIS/HER/ITS INTERESTS WITH RESPECT TO THIS AGREEMENT, THAT
        HE/SHE/IT HAS HAD THE FULL RIGHT AND OPPORTUNITY TO CONSULT WITH SUCH COUNSEL,
        THAT HE/SHE/IT HAS AVAILED HIMSELF/HERSELF/ITSELF OF THIS RIGHT AND OPPORTUNITY,
        THAT HE/SHE/IT HAS CAREFULLY READ AND FULLY UNDERSTANDS THIS AGREEMENT IN
        ITS
        ENTIRETY, THAT HE/SHE/IT IS FULLY AWARE OF THE CONTENTS HEREOF AND THE MEANING,
        INTENT AND LEGAL EFFECT OF THIS AGREEMENT, AND THAT HE/SHE/IT HAS EXECUTED
        THIS
        AGREEMENT FREE FROM COERCION, DURESS OR UNDUE INFLUENCE. SPECIFICALLY, BY
        SIGNING THIS AGREEMENT, EACH GUEZ PARTY UNDERSTAND, AND HEREBY JOINTLY AND
        SEVERALLY ACKNOWLEDGES AND CONFIRMS, THAT HE/SHE/IT MAY BE GIVING UP SIGNIFICANT
        LEGAL RIGHTS. SHOULD ANY PROVISION OF THIS AGREEMENT REQUIRE JUDICIAL
        INTERPRETATION, IT IS AGREED THAT A COURT INTERPRETING OR CONSTRUING THE
        SAME
        SHALL NOT APPLY A PRESUMPTION THAT THE TERMS HEREOF SHALL BE MORE STRICTLY
        CONSTRUED AGAINST ANY PARTY BY REASON OF THE RULE OF CONSTRUCTION THAT A
        DOCUMENT IS TO BE CONSTRUED MORE STRICTLY AGAINST THE PARTY WHO ITSELF OR
        THROUGH ITS AGENT PREPARED THE SAME, IT BEING AGREED THAT ALL PARTIES HERETO
        HAVE PARTICIPATED IN THE PREPARATION OF THIS AGREEMENT.

       

      11. Notices.
        Any
        notice required to be given or delivered by one party to the other hereunder
        shall be in writing and addressed as specified below or at such other addresses
        as shall be specified by the parties by like notice. All notices shall be
        deemed
        effectively given (a) upon personal delivery, (b) five (5) days after deposit
        in
        the United States mail by certified or registered mail (return receipt
        requested), (c) two (2) business day after its deposit with any return receipt
        express courier (prepaid), or (d) one (1) business day after transmission
        by
        facsimile or electronic mail.


      
        
          
          

        

        
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        	If to the
                Company:	 	If
                to the Guez Parties:
	 	 	 
	
                Blue
                  Holdings, Inc.

              	 	
                Paul
                  and Elizabeth Guez

              
	
                4901
                  Zambrano Street

              	 	
                972
                  Palisades Beach Road

              
	
                Commerce,
                  CA 90040

              	 	
                Santa
                  Monica, CA 90403

              
	
                Fax:
                  323-726-6857

              	 	
                Fax:
                  310-458-0224

              
	
                e-mail:
                  glenn.palmer@blueholdings.com

              	 	
                e-mail:
                  paulguez@blueholdings.com

              


      

      


      With
        a
        copy to:

      (which
        shall not constitute notice)

      


      Stubbs
        Alderton & Markiles, LLP

      15260
        Ventura Boulevard, 20th
        Floor

      Sherman
        Oaks, CA 91403

      Attn:
        Gregory Akselrud, Esq.

      Fax:
        818-444-6303

      e-mail:
        gakselrud@biztechlaw.com

      


      12. Further
        Actions.
        Whether
        or not specifically required under the terms of this Agreement, each party
        hereto shall execute and deliver such documents and take such further actions
        as
        shall be necessary in order for such party to perform all of its obligations
        specified herein or reasonably implied from the terms hereof.

       

      13. Successors,
        Third Party Beneficiaries.

       

      13.1 This
        Agreement is personal to the Guezes and, without the prior written consent
        of
        the Company, is not assignable by the Guezes. This Agreement will inure to
        the
        benefit of and be enforceable by the Guezes’ legal representatives (including
        any duly appointed guardian) acting in their capacities as such pursuant
        to
        applicable law.

       

      13.2 This
        Agreement will inure to the benefit of and be binding on the Company and
        its
        successors and assigns. The Company will be entitled to assign all of its
        obligations hereunder to any successor (direct or indirect and whether by
        purchase, merger, consolidation, share exchange or otherwise) to the business,
        properties and assets of the Company; provided,
        however,
        that
        the Company will remain liable for the full, timely performance of all the
        obligations so assigned as if such assignment had not been made.

       

      13.3 Except
        as
        otherwise expressly provided in this Agreement, this Agreement is not intended,
        and shall not be construed, deemed or interpreted, to confer on any person
        or entity not a party hereto any rights or remedies hereunder.

       

      14. Execution
        In Counterparts.
        This
        Agreement may be executed in two (2) or more counterparts (including via
        facsimile or portable document format signatures), all of which taken together
        shall constitute one agreement.


      
        
          
          

        

        
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      15. Severability
        and Governing Law.

       

      15.1 Should
        any of the provisions in this Agreement be declared or be determined to be
        illegal or invalid, all remaining parts, terms or provisions, or any sections,
        subsections, paragraph or subparagraphs, shall be valid, and the illegal
        or
        invalid part, term or provision, or section, subsection, paragraph or
        subparagraph, shall be deemed not to be a part of this Agreement.

       

      15.2 This
        Agreement is made and entered into in the State of California and shall in
        all
        respects be interpreted, enforced and governed under the laws of California,
        without
        regard to conflict of law principles thereof.

       

      16. Proper
        Construction.

       

      16.1 The
        language of all parts of this Agreement shall in all cases be construed as
        a
        whole according to its fair meaning, and not strictly for or against any
        of the
        parties.

       

      16.2 As
        used
        in this Agreement, singular or plural number shall be deemed to include the
        other, the term “it” shall be deemed to include the terms “he” and “she” and the
        term “or” shall be deemed to include the term “and/or” whenever the context so
        indicates or requires.

       

      16.3 The
        paragraph headings used in this Agreement are intended solely for convenience
        of
        reference and shall not in any manner amplify, limit, modify or otherwise
        be
        used in the interpretation of any of the provisions hereof.

       

      17. Entire
        Agreement. This
        Agreement is the entire agreement between the Guezes and the Company, and
        fully
        supersedes any and all prior agreements or understandings between the parties
        pertaining to its subject matter.

       

      [Signatures
        appear on next page]


      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      


      IN
        WITNESS WHEREOF, the parties have
        executed
        this Settlement Agreement and Mutual Release as of the date first above
        written.

       

      
        	BLUE
                HOLDINGS, INC.	 	 
	 	 	 	 
	
                By:

              	
                /s/
                  Glenn S. Palmer

              	 	
                /s/
                  Paul Guez

              
	 	
                Glenn
                  S. Palmer

              	 	
                Paul
                  Guez

              
	 	
                Chief
                  Executive Officer

              	 	 
	 	 	 	 
	 	 	 	
                /s/
                  Elizabeth Guez 

              
	 	 	 	
                Elizabeth
                  Guez

              


      

      


      
        	THE
                PAUL AND BETH GUEZ
	LIVING
                TRUST
	 	 
	
                By:

              	
                /s/
                  Paul Guez

              
	 	
                Paul
                  Guez, Trustee

              
	 	 
	
                By:

              	
                /s/
                  Elizabeth Guez

              
	 	
                Elizabeth
                  Guez, Trustee

              
	 	 
	BLUE
                CONCEPT, LLC
	 	 
	
                By:

              	
                /s/
                  Paul Guez

              
	 	
                Paul
                  Guez, Manager

              
	
              	 
	TAVERNITI
                HOLDINGS, LLC
	 	 
	
                By:

              	
                /s/
                  Paul Guez

              
	 	
                Paul
                  Guez, Manager

              
	 	 
	YANUK
                JEANS, LLC
	 	 
	
                By:

              	
                /s/
                  Paul Guez

              
	 	
                Paul
                  Guez, Manager

              


      


      
        
          
          

        

        
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      EXHIBIT
        A

      


      8%
        SENIOR CONVERTIBLE NOTE