Unassociated Document


    CONVERSION
AGREEMENT

    


    This Conversion Agreement is made by
and between 22nd Century Limited, LLC, a Delaware limited liability company
(“22nd Century”), and ______________________, a ______________
[corporation/partnership/limited liability company] (the “Holder”), effective as
of December ____, 2010.

    


    WHEREAS, 22nd Century previously issued
to Holder a promissory note, dated __________, in the original principal amount
of ___________________ Dollars ($________________) made payable to Holder (the
“Note”);

    


    WHEREAS, the total amount due under the
Note is $_____________ as of the effective date hereof; and

    


    WHEREAS,
Holder desires to convert and exchange the amount of ___________________ Dollars
($________________) of this indebtedness evidenced by the Note for _______ Units
of 22nd Century as described in the Private Placement Memorandum, dated December
16, 2010 (the “Units”).

    


    NOW, THEREFORE, in consideration for
the mutual premises set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto intending to be legally bound do hereby agree as
follows:

    


    1.           Holder
hereby sells, assigns, conveys, transfers, converts, exchanges and delivers to
22nd Century, and 22nd Century hereby accepts, all of Holder’s right, title and
interest in and to the indebtedness evidenced by the Note in the amount of
___________________ Dollars ($________________), free and clear of all liens,
claims, encumbrances and interests in property of every kind and
nature.

    


    2.           Holder
acknowledges and confirms receipt of (i) the Units in exchange for the
above-described amount of the indebtedness evidenced by the Note and, if
necessary, (ii) a new promissory note issued by 22nd Century to Holder for the
remaining, unconverted balance of the Note in the amount of ___________________
Dollars ($________________).

    


    3.           At
any time and from time to time, upon request of 22nd Century, Holder agrees to
do, execute, acknowledge and deliver, or cause to be done, executed,
acknowledged and delivered, such further acts, instruments, documents, deeds,
assignments, transfers, mortgages, conveyances, powers of attorney,
confirmations and assurances as 22nd Century may reasonably request to more
effectively convey, perfect, assign and transfer to and vest in 22nd Century,
its successors and assigns, full legal right, title and interest in and actual
possession of the above-described amount of the Note which has been converted
under this Conversion Agreement.

    


    IN WITNESS WHEREOF, the parties have
executed this Conversion Agreement as of the date written above.

    


    
      
        	
                22nd
      Century Limited, LLC

              	 
      	
                [_________________________]

              
	 
      	 
      	 
      
	
                By: 

              	
                  

              	
                   

              	
                By: 

              	
                  

              
	
                Name:

              	 
      	
                Name:

              
	
                Title:

              	 
      	
                Title: