Exhibit
4.2


 


 






    	 		 



     


    

 


CERTIFICATE
OF DESIGNATIONS OF THE

SERIES B CONVERTIBLE PREFERRED STOCK OF

BOXLIGHT CORPORATION


 


PURSUANT
TO SECTION 78.195

OF THE NEVADA REVISED STATUTES


 


I,
Sheri Lofgren, hereby certify that I am the Chief Financial Officer of Boxlight Corporation (the “Corporation”),
a corporation organized and existing under the Nevada Revised Statutes, and further do hereby certify:


 


That
pursuant to the authority expressly conferred upon the Board of Directors of the Corporation (the “Board”)
by the Corporation’s Articles of Incorporation, as amended (the “Articles of Incorporation”), the Board
on July 30, 2015, adopted the following resolutions creating a series of preferred stock designated as Series B Convertible Preferred
Stock, none of which have been issued:


 


RESOLVED,
that the Board designates the Series B Convertible Preferred Stock and the number of shares constituting such series, and fixes
the rights, powers, preferences, privileges and restrictions relating to such series in addition to any set forth in the Articles
of Incorporation as follows:


 


TERMS
OF SERIES B CONVERTIBLE PREFERRED STOCK


 


1.
Definitions; Designation and Number.


 


1.1.
Unless otherwise defined elsewhere herein, all capitalized terms used in this Certificate of Designation shall have the meaning
as such terms are defined on Exhibit II attached hereto and made a part hereof.


 


1.2.
A series of Preferred Stock, designated as Series B Convertible Preferred Stock (“Series B Preferred Stock”),
par value $0.0001 per share, is hereby established. The number of authorized shares of Series B Preferred Stock shall be one million
two hundred thousand (1,200,000) shares.


 


1.3.
The initial one million (1,000,000) shares of Series B Preferred Stock (the “Original Series B Preferred Stock”)
will be issued at the “Exchange Date”, as defined in and pursuant to the terms of an Exchange Agreement (the
“Genesis Exchange Agreement”), effective as of September 30, 2014 by, between and among the Corporation, Vert
Capital Corp. (“Vert”), a Delaware corporation, Logical Choice Corporation, a Delaware corporation, Mark Elliott
(“Elliott”), John Cox (“Cox”), Operational Security Systems, Inc. (“OSS”),
The Verta Group, LLC and Tommy Duffey, and, collectively, with Elliott, Cox and OSS, the “Genesis Parties,”
and each, individually, a “Genesis Party”), as the former owners of 100% of the membership interests in Genesis
Collaboration LLC, a Georgia limited liability company. The Exchange Date is referred to herein at the “Original Issue
Date.” On the Original Issue Date all of the shares of Original Series B Preferred Stock will issued at an original
issue price of One Dollar ($1.00) per share (the “Series B Original Issue Price”). The remaining two hundred
thousand (200,000) shares of authorized Series B Preferred Stock (the “Series B Preferred Dividend Stock”)
will be reserved and may only be issued as payment of dividends pursuant to Section 3 below.


 


1.4.
On or before the Original Issue Date, and simultaneous with a Going Public Event (as defined in the Genesis Exchange Agreement
attached hereto), the Corporation intends to consummate one or more acquisitions (collectively, the “Acquisitions”)
of all or a majority of the capital stock, membership interests, partnership interests or other equity of one or more corporations,
limited liability companies, partnerships or other entities (each a “Target Company”) each of which, at the
time of the Acquisition: (i) will not be an Affiliate (as defined in Exhibit II, attached hereto) of the
Corporation or Vert; and (ii) will be engaged in the business of providing of products and services to schools and other
Persons providing educational instruction to children and adults. The Corporation intends to consummate the Acquisitions of the
Target Companies in exchange for cash, notes and shares of series of $0.0001 par value preferred stock of the Corporation which
are authorized by separate certificates of designations to be filed in the future by the Corporation (the “Acquisition
Preferred Stock”).


 




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2.
Rank. As to the payment of cash dividends or a distribution of assets upon a Liquidating Event (as defined in Exhibit
II), all shares of the Series B Preferred Stock shall rank (a) senior to the Corporation’s
Common Stock, $0.0001 par value per share, of the Corporation (the “Common Stock”) and any other class of securities
which is specifically designated as junior to the Series B Preferred Stock (collectively, with the Common Stock, the “Junior
Securities”); (b) pari passu with any then outstanding shares of the Corporation’s (i)
$0.0001 par value Series A Preferred Stock (the “Series A Preferred Stock”), (ii) Acquisition Preferred
Stock, and (iii) series of preferred stock hereafter created which expressly state, by their terms, as on parity with the Series
B Preferred Stock, (collectively, the “Pari Passu Securities”); and (iii) junior to any
notes, convertible securities or class or series of capital stock of the Corporation which are hereafter issued for the purpose
of consummating a Private Placement Financing (as defined in Section 6.3, below) and are expressly ranked, by their
terms, as senior to the Series B Preferred Stock (collectively, the “Senior Securities”).


 


3.
Dividends. Each outstanding share of Original Series B Preferred Stock shall earn dividends equal to 6% per annum of its Series
B Original Issue Price (as defined Section 1.1, above), payable in cash or, at the Corporation’s option, in
additional shares of Series B Preferred Dividend Stock valued at the Series B Original Issue Price. The dividends will accrue
on a per diem basis, based on a 365 day year, and regardless of whether or not declared and
whether or not there are profits, surplus or other funds legally available for payment of dividends; provided, however,
that upon the occurrence of a Going Public Event prior to a Liquidating Event, any shares of Series B Preferred Dividend Stock:
(a) which have previously been issued, will be cancelled; and (b) which have previously been earned, but have not
yet been issued, will be deemed for all purposes to be forfeited.


 


4.
Liquidation Preference. Upon a Liquidating Event (as defined in Exhibit II, attached hereto) which occurs prior
to a Going Public Event (as defined in the Exchange Agreement), each share of Series B Preferred Stock will have an aggregate
liquidation preference equal to its Series B Preferred Stock Original Issue Price plus all accrued dividends which have
not previously been paid or distributed in cash or in additional shares of Series B Preferred Stock (as required by Section
3, above).


 


5.
Voting Rights. Except as expressly set forth to the contrary herein, the Series B Preferred Stock shall vote together (and
not as a separate class) with any then outstanding shares of Common Stock, Series A Preferred Stock and Acquisition Preferred
Stock. Each share of Common Stock will have one vote, and each then outstanding share of Series A Preferred Stock, Series B Preferred
Stock and other Acquisition Preferred Stock entitled to vote shall have a number of votes equal to the number of shares of Common
Stock into it would be converted if it were converted into Common Stock immediately prior to such vote (a “Hypothetical
Conversion”). Each holder of a share of Series B Preferred Stock shall be entitled to notice of any stockholders’
meeting in accordance with the Bylaws of the Corporation and the DGCL. If after a Hypothetical Conversion and after aggregating
all shares of Common Stock into which shares of Series B Preferred Stock held by such holder would be converted), a holder of
shares of the Series B Preferred Stock would be deemed (solely of voting purposes) to own a fractional number of shares of Common
Stock, then (solely of voting purposes) the fractional number of shares of Common Stock deemed owned by such holder of Series
B Preferred Stock shall be rounded to the nearest whole number (with one-half being rounded upward).


 




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6.
Conversion.


 


6.1.
Mandatory Conversion. Upon a occurrence of a Going Public Event (as defined in the Genesis Exchange Agreement),
all, and not less than all, of the shares of Original Series B Preferred Stock (but no shares of Series B Preferred Dividend Stock
which shall be fully cancelled) shall automatically (and without any further action on the part of the Corporation or any holder
of Original Series B Preferred Stock) convert into the Series B Conversion Shares (as defined in Exhibit II, attached
hereto) as computed immediately prior to the Going Public Event, and, thereafter, each holder of Original Series B Preferred Stock
shall be entitled to receive its pro-rata portion of the Series B Conversion Shares. The pro-rata share of the Series B Conversion
Shares of each holder of Original Series B Preferred Stock shall be determined by multiplying the total number of Series B Conversion
Shares by a fraction, the numerator of which number of shares of Original Series B Preferred Stock held by such holder immediately
prior to the Going Public Event (excluding any issued shares of Series B Preferred Dividend Stock) and the denominator of which
is the aggregate number of shares of Original Series B Preferred Stock (excluding any issued shares of Series B Preferred Dividend
Stock) held by all holders of Original Series B Preferred Stock immediately prior to the Going Public Event.


 


6.2.
Optional Conversion.


 


6.2.1.
Time. Beginning one (1) year after the Original Issue Date or upon an earlier Liquidating Event (as defined in Exhibit
II) (assuming no prior Going Public Event), each holder of Series B Preferred Stock will be entitled to elect to convert
its shares of Series B Preferred Stock (excluding any issued shares of Series B Preferred Dividend Stock) into that number of
shares of Common Stock as shall be determined by dividing the number of shares of Series B Preferred Stock which the holder desires
to convert by the Series B Conversion Percentage, as computed at that time.


 


6.2.2.
Information to be Provided. If the Corporation proposes a Liquidating Event, the Corporation will give the holders of Series
B Preferred Stock not less than 10 days’ advance written notice of the proposed closing date or other date of proposed consummation
of the Liquidating Event, which notice shall state reasonable details (including the Series B Conversion Percentage) sufficient
to allow the holder to make an informed decision whether to voluntarily convert. The holder may make an election to convert by
as set forth in Section 6.2.3, below, and such optional conversion shall occur immediately prior to and contingent
upon the closing or completion of the Liquidating Event. If at any time the Corporation determines that the proposed Liquidating
Event shall not be consummated, the Series B Preferred Stock shall not be converted and the Corporation shall return the Series
B Preferred Stock to the holder.


 


6.2.3.
Method for Optional Conversion. In order to effect an optional conversion, a holder of shares of Series B Preferred Stock
shall: (i) fax (or otherwise deliver) a copy of a fully executed notice of conversion (a “Notice of Conversion”),
in the form as attached hereto as Exhibit I, to the Corporation (Attention: Secretary) and (ii) surrender
or cause to be surrendered the original certificates representing the Series B Preferred Stock being converted (the “Series
B Preferred Stock Certificates”), duly endorsed. Upon receipt by the Corporation of the Notice of Conversion from a
holder of Series B Preferred Stock, the Corporation shall promptly send, via facsimile, a confirmation to such holder stating
that the Notice of Conversion has been received, the date upon which the Corporation expects to deliver the Common Stock issuable
upon such conversion and the name and telephone number of a contact person at the Corporation regarding the conversion. The Corporation
shall not be obligated to issue shares of Common Stock upon a conversion unless either the Series B Preferred Stock Certificates
are delivered to the Corporation as provided above, or the holder notifies the Corporation that such Series B Preferred Stock
Certificates have been lost, stolen or destroyed and delivers the documentation to the Corporation required by Section 15.2
below.


 




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6.3.
Anti-Dilution Adjustment. In the event that, after the Original Issue Date and prior to consummation of a Going Public Event,
the Corporation (a) sells any Common Stock at a price lower that the Series B Conversion Price (as then computed, including
any prior adjustments pursuant to this Section) or issues (b) any Common Stock Equivalent (as defined in Exhibit
II) to an unaffiliated third party in connection with a private placement at a conversion price that is lower
than the Series B Conversion Price (as then computed, including any prior adjustments pursuant to this Section), then such Series
B Conversion Price shall be reduced to such lower per share price. Notwithstanding the foregoing, no adjustment of the Series
B Conversion Price will occur upon the sale of Acquisition Preferred Stock, Common Stock or other Common Stock Equivalents if
sold: (x) in connection with the acquisition of all the securities or assets of a Target Company (as defined in Section
2.2(a) below); (y) in a Going Public Event; or (z) to an unaffiliated third party in connection with a Private
Placement Financing (as defined in Exhibit II), of any securities of the Corporation at an issue price equal to
or greater than the Series B Conversion Price would be if then computed.


 


6.4.
Reservation of Common Stock Issuable Upon Conversion. The Corporation shall at all times reserve and keep available out of
its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of the Series
B Preferred Stock, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion
of all outstanding shares of the Series B Preferred Stock; and if at any time the number of authorized but unissued shares of
Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Series B Preferred Stock,
the Corporation will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized
but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose, including, without limitation,
engaging in best efforts to obtain the requisite stockholder approval of any necessary amendment to the Corporation’s Articles
of Incorporation.


 


6.5.
Fractional Shares. No fractional share shall be issued upon the conversion of any share or shares of Series B Preferred Stock.
All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series B Preferred
Stock by a holder thereof shall be aggregated for purposes of determining whether the conversion would result in the issuance
of any fractional share.


 


7.
Limited Preemptive Right. In the event that the Corporation proposes to offer and issue additional Common Stock or Common
Stock Equivalents to Vert or any Affiliate of Vert (other than Common Stock or Common Stock Equivalents currently issued to Vert
or its Affiliate, each individual holder of Series B Preferred Stock will have a preemptive right to invest in such offering and
issuance to the minimum extent necessary to maintain their pro rata ownership of the Fully Diluted Common Stock; provided,
however, that this preemptive right will not apply to a proposed offering or issuance of Common Stock or Common
Stock Equivalents to be issued by the Corporation: (A) in connection with any acquisition of the securities or assets of
another Target Company; (B) in a Going Public Event; or (C) to an unaffiliated third party in connection with a
Private Placement Financing.


 




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8.
Parity. The Series B Preferred Stock will have substantially identical provisions as the the Acquisition Preferred Stock;
provided, however, that the Acquisition Preferred Stock may have different original issue prices and conversion percentages,
will not have preemptive rights and certain of them may not require the payment of a dividend.


 


9.
Reissuance of Series B Preferred Stock. No share or shares of Series B Preferred Stock acquired by the Corporation by reason
of redemption, purchase, conversion or otherwise shall be reissued, and all such shares shall be canceled, retired and eliminated
from the shares which the Corporation shall be authorized to issue.


 


10.
Redemption. The Series B Preferred Stock is not redeemable.


 


11.
Notice. Except as may otherwise be provided for herein, all notices referred to herein shall be in writing, and all notices
hereunder shall be deemed to have been given and received upon the earlier of receipt of such notice or four Business days after
the mailing of such notice, if sent by registered mail, with postage pre-paid, addressed: (a) if to the Corporation, to
the attention of its corporate secretary or to an agent of the Corporation designated as permitted by the Corporation’s
Certificate of Incorporation, as amended; (b) if to any holder of Series B Preferred Stock, to such holder at the address
of such holder as listed in the stock record books of the Corporation (which may include the records of the Corporation’s
transfer agent); or (c) to such other address as the Corporation or holder, as the case may be, shall have designated by
notice similarly given.


 


12.
Amendment. This Certificate of Designation or any provision hereof may be amended by obtaining the affirmative vote at a meeting
duly called for such purpose (or written consent without a meeting in accordance with the DGCL) of (i) the holders of a majority
of the outstanding shares of Series B Preferred Stock, voting separately as a single class, and (ii) with such other stockholder
approval, if any, as may then be required pursuant to the Delaware General Corporation Law and the Certificate of Incorporation.


 


13.
Transfer Restrictions.


 


13.1.
Lock Up Agreements. If In connection with any Going Public Event, the underwriter of the Corporation’s securities or
any purchaser of securities issued by Vert requests that certain Genesis Parties agree, for a period of time, not to Transfer
any or all of the shares of Common Stock issued to them upon the Going Public Event (the “Restricted Stock”),
the Genesis Parties hereby covenant and agree that they shall each execute and deliver an agreement (a “Lock-up Agreement”),
in form and content satisfactory to the Corporation’s Board (or the board of directors of the public company if the Going
Public Event has been accomplished by a Reverse Merger (as defined as part of the definition of Going Public Event), pursuant
to which, inter alia, each such Member or its assignees or nominees (the “Lock-up Parties”) shall agree
not to effect any Transfer (except to members of its immediate family or trusts for the benefit of its immediate family members)
of any shares of Restricted Stock then owned of record or beneficially by it for a period of one year after the consummation of
the IPO or any other Going Public Event (the “Lock-up Period”), and that after the Lock-up Period, it will
not sell more than 25% of the number of the shares of Restricted Stock during any three month period, unless (i) otherwise
approved by the Corporation’s Board (or the board of directors of the public company if the Going Public Event has been
accomplished by a Reverse Merger); or (ii) other shareholders are selling a greater percentage of the shares issued to
them in connection with the IPO or other Going Public Event. Notwithstanding the foregoing, the Lock-up Parties shall not be required
to execute a Lock-up Agreement unless each of Vert and the executive officers and directors of the Corporation and other stockholders
owning more than 10% of the Fully Diluted Common Stock are also required to execute similar Lock-up Agreements containing substantially
identical terms and conditions, including the period of restrictions on Transfer.


 




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13.2.
Legend. After the Lock-Up Period, any legend endorsed on a certificate pursuant to this Section 13 and the stop
transfer instructions with respect to such securities shall be removed and the Company shall promptly, upon request, issue a certificate
without such legend to the holder thereof if: (a) such securities are eligible to be sold by the holder thereof in accordance
with the terms of Rule 144 promulgated under the Securities Act, (b) such securities are registered under the Securities
Act and a prospectus meeting the requirements of Section 10 of the Securities Act is available, or (c) such holder provides
Company with an opinion of counsel for such holder, reasonably satisfactory to legal counsel for Company to the effect that a
Transfer of such securities may be made without registration.


 


14.
Protective Provisions. So long as any shares of Series B Preferred Stock are outstanding, the Corporation shall not, nor shall
it permit any of its subsidiaries to, take any of the following corporate actions without first obtaining the affirmative vote,
at a meeting duly called for such purpose (or written consent without a meeting in accordance with the DGCL), of the holders of
a majority of the outstanding shares of Series B Preferred Stock, voting separately as a single class:


 


14.1.
Adversely alter or change the rights, preferences or privileges of the Series B Preferred Stock, or increase the authorized
number of shares of Series B Preferred Stock;


 


14.2.
issue any shares of Series B Preferred Stock, other than the Original Series B Preferred Stock and the Series B Preferred
Dividend Stock; or


 


14.3.
except in connection with a Private Placement Financings, issue any shares of Preferred Stock that rank senior to the Series
B Preferred Stock.


 


Notwithstanding
the foregoing, no change pursuant to this Section 12 shall be effective to the extent that, by its terms, it applies
to less than all of the holders of shares of Series B Preferred Stock then outstanding.


 


15.
Miscellaneous.


 


15.1.
Cancellation of Series B Preferred Stock. If any shares of Series B Preferred Stock are converted pursuant to this Certificate
of Designations, the shares so converted shall be canceled, shall return to the status of authorized, but unissued Series B Preferred
Stock of no designated series, and shall not be issuable by the Corporation as Series B Preferred Stock.


 


15.2.
Lost or Stolen Certificates. Upon receipt by the Corporation of (a) evidence of the lost, theft, destruction or mutilation
of any Series B Preferred Stock Certificate(s) and (b) (i) in the case of loss, theft or destruction, indemnity
(without any bond or other security) reasonably satisfactory to the Corporation, or (ii) in the case of mutilation, the
Series B Preferred Stock Certificate(s) (surrendered for cancellation), the Corporation shall execute and deliver new Series B
Preferred Stock Certificate(s) of like tenor and date. However, the Corporation shall not be obligated to reissue such lost, stolen,
destroyed or mutilated Series B Preferred Stock Certificate(s) if the holder contemporaneously requests the Corporation to convert
such Series B Preferred Stock.


 




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15.3.
Waiver. Notwithstanding any provision in these Certificate of Designations to the contrary, any provision contained herein
and any right of the holders of Series B Preferred Stock granted hereunder may be waived as to all shares of Series B Preferred
Stock (and the holders thereof) upon the affirmative vote, at a meeting duly called for such purpose (or written consent without
a meeting in accordance with the DGCL), of the holders of a majority of the outstanding shares of Series B Preferred Stock, voting
separately as a single class, unless a higher percentage is required by applicable law, in which case the written consent of the
holders of not less than such higher percentage of shares of Series B Preferred Stock shall be required.


 


15.4.
Information Rights. So long as shares of Series B Preferred Stock are outstanding, the Corporation will deliver to each holder
of Series B Preferred Stock (a) unaudited annual financial statements to the holders of Series B Preferred Stock within
90 days after the end of each fiscal year; and (b) unaudited quarterly financial statements within 45 days of the end of
each fiscal quarter. Notwithstanding the foregoing, in the event and to the extent that such information is electronically available
on the web site of the Securities and Exchange Commission (www.sec.gov), the Corporation need not separately furnish such
documents to holders of the Series B Preferred Stock.


 


The
undersigned declares under penalty of perjury under the laws of the State of Nevada that the matters set forth in this certificate
are true and correct of his own knowledge.


 


The
undersigned has executed this certificate on August , 2015.


 


	 	/s/
    Sheri Lofgren
	 	Sheri
    Lofgren, Chief Financial Officer


 




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EXHIBIT
I


 


BOXLIGHT
CORPORATION

CONVERSION NOTICE


 


Reference
is made to the Certificate of Designations of the Series B Convertible Preferred Stock (the “Certificate of Designations”)
of Boxlight Corporation, a Nevada corporation (the “Corporation”). In accordance with and pursuant to the Certificate
of Designations, the undersigned hereby elects to convert the number of shares of Series B Convertible Preferred Stock, $0.0001
par value per share (the “Series B Preferred Stock”), of the Corporation indicated below into shares of common
stock, $0.0001 value per share (the “Common Stock”), of the Corporation, as of the date specified below.


 


	 	Date
    of Conversion: 
                                                                                                                                                	 
	 	 	 
	 	Number     of
    shares of Series B Preferred Stock to be converted: 
                                                                       	 
	 	 	 
	 	Share
    certificate     no(s). of Series B Preferred Stock to be converted: 
                                                              	 
	 	 	 
	 	Tax     ID Number
    (if applicable): 
                                                                                                                               	 
	 	 	 
	 	Number of shares
    of Common Stock to be issued: 
                                                                                             	 


 


Please
issue the shares of Common Stock into which the shares of Series B Preferred Stock are being converted in the following name and
to the following address:


 


	 	Issue
    to:	                                                                                     
	 	 	 
	 	 	                                                                                     
	 	 	 
	 	Address:
    	                                                                                     
	 	 	 
	 	 	                                                                                     
	 	 	 
	 	Telephone
    Number: 	                                                                                     
	 	 	 
	 	Facsimile
    Number: 	                                                                                     
	 	 	 
	 	Name
    of Holder: 	                                                                                     


 


	 	By:
                                                                                                    
	 	 
	 	Print     Name: 
                                                                                      
	 	 
	 	Print     Title: 
                                                                                        
	 	 
	 	Date:
                                                                                                 


 


	 	Account
    Number (if electronic book entry transfer): 
                                                                                       
	 	 
	 	Transaction
    Code Number (if electronic book entry transfer):                                                                     


  




    	 



    	 



    


 


EXHIBIT
II


 


DEFINITIONS


 


As
used in this Certificate of Designations, the following terms will bear the following meanings:


 


“Affiliate”
means (i) any individual who is a parent, spouse, sibling, or descendant of a party and (ii) any Person
that is controlled by, controls or is under common control with a party, and for the purpose of this definition, “controlled
by”, “controls”, and “under common control with” mean and refer
to the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person,
through the ownership of voting securities, by contract, or otherwise.


 


“Business
Day” means a day, other than a Saturday or Sunday, on which commercial banks in New York City, New York are open
for the general transaction of business.


 


“Common
Stock Equivalents” means all options, warrants, promissory notes, debentures, preferred stock (including the Series
B Preferred Stock and all series of Acquisition Preferred Stock) and other instruments issued by the Corporation which are convertible
into or exercisable for shares of the Corporation’s Common Stock.


 


“Liquidating
Event” means either: (i) the voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, or such of the Corporation’s subsidiaries the assets of which constitute all or substantially all the assets
of the business of the Corporation and its subsidiaries taken as a whole; or (ii) a Sale of Control.


 


“Person”
means any person or entity, whether an individual, trustee, corporation, limited liability company, general partnership, limited
partnership, trust, unincorporated organization, business association, firm, joint venture, governmental agency or authority or
any other for profit or not for profit legal or commercial entity.


 


“Private
Placement Financing(s)” means any one or more private placements for cash of Common Stock or other securities of
the Corporation (including Common Stock Equivalents) in any transaction that is exempt from the registration requirements of the
Securities Act of 1933, as amended.


 


“Sale
of Control” means the sale of all or substantially all of the assets or capital stock of the Corporation and its
subsidiaries, whether by merger, consolidation, tender offer or like combination, to any person who is not an affiliate of the
Corporation or any of the Corporation’s Affiliates.


 


“Series
B Conversion Percentage” is determined by dividing the number of shares of Original Series B Preferred Stock by
the number of Series B Conversion Shares issuable at any specified time.


 


“Series
B Conversion Price” is determined by multiplying the Series B Original Issue Price by the Series B Conversion Percentage.


 


“Series
B Conversion Shares” means that number of shares of Common Stock as would equal four percent (4.0%) of the Fully
Diluted Common Stock at any specified time.


 


“Transfer”
means to sell, transfer, hypothecate or otherwise assign.