Exhibit 10.2


 


Execution Copy


 


NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. NOTWITHSTANDING THE FOREGOING, THIS
SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY SUCH SECURITIES. ANY TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE TERMS OF
THIS NOTE, INCLUDING SECTIONS 3(c)(iii) AND 15(a) HEREOF. THE PRINCIPAL AMOUNT REPRESENTED BY THIS NOTE AND, ACCORDINGLY, THE
SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS THAN THE AMOUNTS SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 3(c)(iii)
OF THIS NOTE. THIS NOTE HAS BEEN ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”). PURSUANT TO TREASURY
REGULATION §1.1275-3(b)(1), LESLIE BUTTORFF, A REPRESENTATIVE OF THE COMPANY WILL, BEGINNING TEN DAYS AFTER THE ISSUANCE THIS
NOTE, PROMPTLY MAKE AVAILABLE TO THE HOLDER UPON REQUEST THE INFORMATION DESCRIBED IN TREASURY REGULATION §1.1275-3(b)(1)(i).
LESLIE BUTTORFF MAY BE REACHED AT TELEPHONE NUMBER (303) 434-0215.


 


SENIOR
CONVERTIBLE NOTE OF


PANACEA
LIFE SCIENCES HOLDINGS, INC.


 


	Issuance
    Date: March 3, 2022	Original
    Principal Amount: $385,000


 


FOR
VALUE RECEIVED, Panacea Life Sciences Holdings, Inc., a Nevada corporation (the “Company”), hereby promises to
pay to the order of FirstFire Global Opportunities Fund, LLC or its registered assigns (“Holder”) the amount set forth
above as the Original Principal Amount (as reduced pursuant to the terms hereof pursuant to redemption, conversion or otherwise, the
“Principal”) when due, whether upon the Maturity Date, or upon acceleration, redemption or otherwise (in each case
in accordance with the terms hereof) and, if an Event of Default has occurred and is continuing, to pay interest (“Interest”)
on any outstanding Principal, in the case of an Event of Default, at the Default Rate (as defined below), in each case until the same
becomes due and payable, whether upon the Maturity Date, or upon acceleration, conversion, redemption or otherwise (in each case in accordance
with the terms hereof).


 




    	-1-



     


    

 


This
Senior Convertible Note (including all Senior Convertible Notes issued in exchange, transfer or replacement hereof, this “Note”
(the “Other Notes”) is issued pursuant to the Exchange Agreement, dated as of March 3, 2023, between the Company
and the Holder. Certain capitalized terms used herein are defined in Section 26 of this Note. Capitalized terms used, but not otherwise
defined herein, shall have the meaning set forth in that certain Securities Purchase Agreement dated as of November 30, 2021 between
the Company and Lincoln Park Capital Fund, LLC (the “Purchase Agreement).


 


1.
PAYMENTS OF PRINCIPAL. On the Maturity Date, the Company shall pay to the Holder an amount in cash representing all outstanding Principal,
accrued and unpaid Interest, if any, and accrued and unpaid Late Charges (as defined in Section 20(c)), if any, on such Principal and
Interest. Other than as specifically permitted by this Note, the Company may not prepay any portion of the outstanding Principal, accrued
and unpaid Interest or accrued and unpaid Late Charges on Principal and Interest, if any. Notwithstanding anything herein to the contrary,
with respect to any conversion or redemption hereunder, as applicable, the Company shall convert or redeem, as applicable, First,
all accrued and unpaid Interest hereunder, if any, Second, all accrued and unpaid Late Charges on any Principal and Interest hereunder,
if any, and Third, after extinguishment of all such accrued and unpaid Interest and Late Charges, if any, all Principal outstanding
hereunder.


 


2.
INTEREST; INTEREST RATE; DEFAULT RATE.


 


(a)
No Interest shall accrue hereunder until an Event of Default (as defined below) has occurred. From and after the occurrence and during
the continuance of any Event of Default, Interest shall accrue hereunder at eighteen percent (18.0%) per annum (the “Default
Rate”) and shall be computed on the basis of a 365-day year and the actual number of days elapsed. Accrued and unpaid Interest,
if any, shall be payable by way of inclusion of such Interest in the Conversion Amount (as defined below) on each Conversion Date (as
defined below) in accordance with Section 3(b)(i), or upon any redemption in accordance with Section 9 or any required payment upon any
Bankruptcy Event of Default (as defined in Section 4(a) below).


 


(b)
If such Event of Default is subsequently cured, and if no other Event of Default has occurred and is then continuing, Interest shall
cease to accrue hereunder as of the calendar day immediately following the date on which such Event of Default is cured; provided
that the Interest as calculated and unpaid during the continuance of such Event of Default shall continue to apply in respect of
the full calendar-day period commencing on the date on which such Event of Default initially occurred, and ending on the date on which
such Event of Default is cured; provided, further, that for the purpose of this Section 2, such Event of Default shall
not be deemed cured unless and until any and all accrued and unpaid Interest accrued at the Default Rate shall have been paid to the
record Holder of this Note in cash; and provided, further, that notwithstanding any prior cure of such Event of Default,
Interest shall again accrue hereunder at the Default Rate upon the occurrence and during the continuance of any other Event of Default,
and shall be computed and shall be payable as set forth in this Section 2.


 




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3.
CONVERSION OF NOTES. This Note is convertible into validly issued, fully paid and non-assessable shares of Common Stock (as defined
below), on the terms and conditions set forth in this Section 3.


 


(a)
Conversion Right. Subject to the provisions of Section 3(c)(vi), at any time or times on or after the Issuance Date, the Holder
shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount (as defined below) into validly issued, fully
paid and non-assessable shares of Common Stock in accordance with Section 3(c), at the Conversion Rate (as defined below).


 


(b)
Conversion Rate. The number of shares of Common Stock issuable upon conversion of any Conversion Amount pursuant to Section 3(a)
shall be determined by dividing (x) such Conversion Amount by (y) the Conversion Price (the “Conversion Rate”).


 


(i)
“Conversion Amount” means the sum of (x) the portion of the Principal to be converted, redeemed or otherwise with
respect to which this determination is being made and (y) all accrued and unpaid Interest with respect to such portion of the Principal
amount and accrued and unpaid Late Charges with respect to such portion of such Principal and such Interest, if any.


 


(ii)
“Conversion Price” means, with respect to any Conversion Date or other date of determination, (w) if no Event of Default
has occurred prior to the Maturity Date, the Fixed Conversion Price then in effect, and (x) if an Event of Default has occurred prior
to the Maturity Date, the Default Conversion Price; provided that (I) if such Event of Default is cured on or prior to the fifteenth
(15th) calendar day immediately following the date on which such Event of Default initially occurred, and if no other Event
of Default has occurred and is then continuing, the term “Conversion Price” shall mean, with respect to any Conversion
Date or other date of determination on or after the calendar day immediately following the date on which such Event of Default is cured,
and (y) if no Event of Default has occurred on or after such calendar day immediately following the date of such cure and prior to the
Maturity Date, the Fixed Conversion Price then in effect, and (z) if an Event of Default has occurred on or after such calendar day immediately
following the date of such cure and prior to the Maturity Date, the Default Conversion Price (subject again to the terms of this proviso,
mutatis mutandis, for as long as any portion of this Note shall remain outstanding), and (II) if such Event of Default is not
cured on or prior to the fifteenth (15th) calendar day immediately following the date on which such Event of Default initially
occurred, or if any other Event of Default has occurred and is then continuing on such fifteenth (15th) calendar day immediately
following the date on which such Event of Default initially occurred, the term “Conversion Price” shall mean, with
respect to any Conversion Date or other date of determination on or after the date on which such Event of Default initially occurred
and through and including the Maturity Date, the Default Conversion Price; and provided, further, that (1) notwithstanding
any prior cure of an Event of Default on or prior to the fifteenth (15th) calendar day immediately following the date on which
such Event of Default initially occurred, the Default Conversion Price shall continue to apply with respect to any conversion(s) of any
portion of this Note at the Default Conversion Price at any time during the full calendar-day period commencing on the date on which
such Event of Default initially occurred, and ending on the date on which such Event of Default is cured, and (2) for the purpose of
this Section 3(b)(ii), if the Holder has elected to convert this Note in whole or in part, such Event of Default shall not be deemed
cured unless and until, a certificate or certificates, registered in the name of the Holder or its designee, for the number of shares
of Common Stock to which the Holder is entitled upon the Holder’s conversion(s) of this Note at the Default Conversion Price shall
be timely issued and delivered to the Holder in accordance with Section 3(c), or a credit to the balance account of the Holder or the
Holder’s designee with DTC for such number of shares of Common Stock to which the Holder is entitled upon the Holder’s conversion(s)
at the Default Conversion Price of this Note (as the case may be) shall be timely credited to the Holder’s or its designee’s
balance account with DTC through its Deposit/Withdrawal at Custodian system in accordance with Section 3(c).


 




    	-3-



     


    

 


(iii)
“Fixed Conversion Price” means, with respect to any Conversion Date or other date of determination, $1.40, subject
to adjustment as provided herein; provided, however, that notwithstanding any adjustment to the Fixed Conversion Price
that may be required by Section 7 with respect to a Qualified Offering, if the closing of a Qualified Offering has occurred prior to
the Maturity Date and the Fixed Conversion Price in effect immediately prior to the closing of such Qualified Offering (the date on which
the closing of such Qualified Offering occurs, the “Qualified Offering Date”) is greater than an amount equal to the
product of (x) 0.90 and (y) the Public Offering Price Per Share in such Qualified Offering, the term “Fixed Conversion Price”
shall mean, with respect to any Conversion Date or other date of determination at any time on or after the Qualified Offering Date, an
amount equal to the product of (I) 0.90 and (II) the Public Offering Price Per Share in such Qualified Offering, subject to further adjustment
as provided herein.


 


(iv)
“Default Conversion Price” means, as of any Conversion Date or other date of determination, an amount equal to the
product of (x) 0.80 and (y) the Fixed Conversion Price then in effect, subject to further adjustment as provided herein.


 


(c)
Mechanics of Conversion.


 


(i)
Optional Conversion. To convert any Conversion Amount into shares of Common Stock on any date (a “Conversion Date”),
the Holder shall deliver (via facsimile or electronic mail), for receipt on or prior to 11:59 p.m., New York time, on such date, a copy
of an executed notice of conversion in the form attached hereto as Exhibit I (the “Conversion Notice”) to the
Company. Any Conversion Notice received by the Company in accordance with the terms of this Note after 11:59 p.m., New York time, on
any day shall be deemed received by the Company on the next following Trading Day. If required by Section 3(c)(iii), within two (2) Trading
Days following a conversion of this Note as aforesaid, the Holder shall surrender this Note to a nationally recognized overnight delivery
service for delivery to the Company (or an indemnification undertaking with respect to this Note in the case of its loss, theft or destruction
as contemplated by Section 15(b)). On or before the first (1st) Trading Day following the date of receipt of a Conversion Notice, the
Company shall transmit by facsimile or electronic mail an acknowledgment of confirmation and representation as to whether such shares
of Common Stock are eligible to be resold pursuant to Rule 144 or an effective and available registration statement, in the form attached
hereto as Exhibit II, of receipt of such Conversion Notice to the Holder and the Transfer Agent which confirmation shall constitute
an instruction to the Transfer Agent to process such Conversion Notice in accordance with the terms herein. On or before the second (2nd)
Trading Day following the date on which the Company has received (or is deemed to have received) a Conversion Notice (or such earlier
date as required pursuant to the Exchange Act or other applicable law, rule or regulation for the settlement of a trade initiated on
the applicable Conversion Date of such shares of Common Stock issuable pursuant to such Conversion Notice) (the “Share Delivery
Deadline”), the Company shall, (1) after the Resale Eligibility Date and provided that the Transfer Agent is participating
in The Depository Trust Company’s (“DTC”) Fast Automated Securities Transfer Program, credit such aggregate
number of shares of Common Stock to which the Holder shall be entitled pursuant to such conversion to the Holder’s or its designee’s
balance account with DTC through its Deposit/Withdrawal at Custodian system, which balance account Holder shall designate in the applicable
Conversion Notice, or (2) prior to the Resale Eligibility Date or if the Transfer Agent is not participating in the DTC Fast Automated
Securities Transfer Program, upon the request of the Holder, issue and send (via reputable overnight courier) to the address as specified
in the Conversion Notice, a certificate, registered in the name of the Holder or its designee, for the number of shares of Common Stock
to which the Holder shall be entitled pursuant to such conversion. If this Note is physically surrendered for conversion pursuant to
Section 3(c)(iii) and the outstanding Principal of this Note is greater than the Principal portion of the Conversion Amount being converted,
then the Company shall as soon as practicable and in no event later than two (2) Business Days after receipt of this Note and at its
own expense, issue and deliver to the Holder (or its designee) a new Note (in accordance with Section 15(d)) representing the outstanding
Principal not converted. The Person or Persons entitled to receive the shares of Common Stock issuable upon a conversion of this Note
shall be treated for all purposes as the record holder or holders of such shares of Common Stock on the Conversion Date. Notwithstanding
anything to the contrary contained in this Note, after the Resale Eligibility Date, the Company shall cause the Transfer Agent to deliver
unlegended shares of Common Stock to the Holder (or its designee) in connection with any sale of Conversion Shares, and for which the
Holder has not yet settled.


 




    	-4-



     


    

 


(ii)
Company’s Failure to Timely Convert. If the Company shall fail, for any reason, on or prior to the applicable Share Delivery
Deadline, either (I) prior to the Resale Eligibility Date or if the Transfer Agent is not participating in the DTC Fast Automated Securities
Transfer Program, to issue and deliver to the Holder (or its designee) a certificate for the number of shares of Common Stock to which
the Holder is entitled and register such shares of Common Stock on the Company’s share register, or (II) after the Resale Eligibility
Date and if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program, to credit the balance account
of the Holder or the Holder’s designee with DTC for such number of shares of Common Stock to which the Holder is entitled upon
the Holder’s conversion of this Note (as the case may be) (each, a “Conversion Failure”), then, in addition
to all other remedies available to the Holder, (1) the Company shall pay in cash to the Holder on each day after such Share Delivery
Deadline that the issuance of such shares of Common Stock is not timely effected an amount equal to 2.0% of the product of (A) the sum
of the number of shares of Common Stock not issued to the Holder on or prior to the Share Delivery Deadline and to which the Holder is
entitled, multiplied by (B) any trading price of the Common Stock selected by the Holder in writing as in effect at any time during the
period beginning on the applicable Conversion Date and ending on the applicable Share Delivery Deadline and (2) the Holder, upon written
notice to the Company, may void its Conversion Notice with respect to, and retain or have returned (as the case may be) any portion of
this Note that has not been converted pursuant to such Conversion Notice, provided that the voiding of a Conversion Notice shall not
affect the Company’s obligations to make any payments which have accrued prior to the date of such notice pursuant to this Section
3(c)(ii) or otherwise. In addition to the foregoing, if on or prior to the Share Delivery Deadline and after the Resale Eligibility Date
either (A) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, the Company shall fail to
issue and deliver to the Holder (or its designee) a certificate and register such shares of Common Stock on the Company’s share
register or, (B) if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program, the Transfer Agent shall
fail to credit the balance account of the Holder or the Holder’s designee with DTC for the number of shares of Common Stock to
which the Holder is entitled upon the Holder’s conversion hereunder, and if on or after such Share Delivery Deadline the Holder
purchases (in an open market transaction or otherwise) shares of Common Stock corresponding to all or any portion of the number of shares
of Common Stock issuable upon such conversion that the Holder is entitled to receive from the Company and has not received from the Company
in connection with such Conversion Failure (a “Buy-In”), then, in addition to all other remedies available to the
Holder, the Company shall, within two (2) Business Days after receipt of the Holder’s request and in the Holder’s discretion,
either: (I) pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions and
other out-of-pocket expenses, if any) for the shares of Common Stock so purchased (including, without limitation, by any other Person
in respect, or on behalf, of the Holder) (the “Buy-In Price”), at which point the Company’s obligation to so
issue and deliver such certificate (and to issue such shares of Common Stock) or credit the balance account of such Holder or such Holder’s
designee, as applicable, with DTC for the number of shares of Common Stock to which the Holder is entitled upon the Holder’s conversion
hereunder (as the case may be) (and to issue such shares of Common Stock) shall terminate, or (II) promptly honor its obligation to so
issue and deliver to the Holder a certificate or certificates representing such shares of Common Stock or credit the balance account
of such Holder or such Holder’s designee, as applicable, with DTC for the number of shares of Common Stock to which the Holder
is entitled upon the Holder’s conversion hereunder (as the case may be) and pay cash to the Holder in an amount equal to the excess
(if any) of the Buy-In Price over the product of (x) such number of shares of Common Stock multiplied by (y) the lowest Closing Sale
Price of the Common Stock on any Trading Day during the period commencing on the date of the applicable Conversion Notice and ending
on the date of such issuance and payment under this clause (II) (the “Buy-In Payment Amount”). Nothing shall limit
the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including, without limitation,
a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates
representing shares of Common Stock (or to electronically deliver such shares of Common Stock) upon the conversion of this Note as required
pursuant to the terms hereof.


 




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(iii)
Registration; Book-Entry. The Company shall maintain a register (the “Register”) for the recordation of the
names and addresses of the holders of each Note and the principal amount of the Note held by such holders (the “Registered Notes”).
The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Company and the holders of the
Notes shall treat each Person whose name is recorded in the Register as the owner of a Note for all purposes (including, without limitation,
the right to receive payments of Principal and Interest hereunder) notwithstanding notice to the contrary. A Registered Note may be assigned,
transferred or sold in whole or in part only by registration of such assignment or sale on the Register. Upon its receipt of a written
request to assign, transfer or sell all or part of any Registered Note by the holder thereof, the Company shall record the information
contained therein in the Register and issue one or more new Registered Notes in the same aggregate principal amount as the principal
amount of the surrendered Registered Note to the designated assignee or transferee pursuant to Section 15, provided that if the Company
does not so record an assignment, transfer or sale (as the case may be) of all or part of any Registered Note within two (2) Business
Days of such a request, then the Register shall be automatically deemed updated to reflect such assignment, transfer or sale (as the
case may be). Notwithstanding anything to the contrary set forth in this Section 3, following conversion of any portion of this Note
in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Company unless (A) the
full Conversion Amount represented by this Note is being converted (in which event this Note shall be delivered to the Company following
conversion thereof as contemplated by Section 3(c)(i)) or (B) the Holder has provided the Company with prior written notice (which notice
may be included in a Conversion Notice) requesting reissuance of this Note upon physical surrender of this Note. The Holder and the Company
shall maintain records showing the Principal, Interest and Late Charges converted and/or paid (as the case may be) and the dates of such
conversions and/or payments (as the case may be) or shall use such other method, reasonably satisfactory to the Holder and the Company,
so as not to require physical surrender of this Note upon conversion. If the Company does not update the Register to record such Principal,
Interest and Late Charges converted and/or paid (as the case may be) and the dates of such conversions, and/or payments (as the case
may be) within two (2) Business Days of such occurrence, then the Register shall be automatically deemed updated to reflect such occurrence.
The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of this paragraph,
following the conversion of a portion of the Principal due hereunder, the number of the Principal outstanding under this Noted and the
number of Conversion Shares available for conversion hereunder at any given time may be less than the amount stated on the face hereof.


 


(iv)
Pro Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from this Note and one or more holders
of Other Notes for the same Conversion Date and the Company can convert some, but not all, of such portions of this Note and the Other
Notes submitted for conversion, the Company, subject to Section 3(d), shall convert from the Holder and each holder of Other Notes electing
to have this Note or the Other Notes converted on such date a pro rata amount of such holder’s portion of the Note and its Other
Notes submitted for conversion based on the Principal amount of this Note and the Other Notes submitted for conversion on such date by
such holder relative to the aggregate Principal amount of this Note and all Other Notes submitted for conversion on such date. In the
event of a dispute as to the number of shares of Common Stock issuable to the Holder in connection with a conversion of this Note, the
Company shall issue to the Holder the number of shares of Common Stock not in dispute.


 


(v)
No Fractional Shares. The Company shall not issue any fraction of a share of Common Stock upon conversion of any Conversion Amount.
If the issuance would result in the issuance of a fraction of a share of Common Stock, the Company shall round such fraction of a share
of Common Stock up to the nearest whole share.


 


(vi)
Charges, Taxes and Expenses. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses
(including, without limitation, fees and expenses of the transfer agent of the Company (the “Transfer Agent”)) that
may be payable with respect to the issuance and delivery of Conversion Shares upon conversion of any portion of this Note.


 




    	-6-



     


    

 


(d)
Beneficial Ownership Limitation. The Company shall not effect the conversion of any portion of this Note, and the Holder shall
not have the right to convert any portion of this Note pursuant to the terms and conditions of this Note and any such conversion shall
be null and void and treated as if never made, to the extent that after giving effect to such conversion, the Holder together with the
other Attribution Parties collectively would beneficially own in excess of 4.99% (the “Maximum Percentage”) of the
shares of Common Stock outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence, the aggregate
number of shares of Common Stock beneficially owned by the Holder and the other Attribution Parties shall include the number of shares
of Common Stock held by the Holder and all other Attribution Parties plus the number of shares of Common Stock issuable upon conversion
of this Note with respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would
be issuable upon (A) conversion of the remaining, non-converted portion of this Note beneficially owned by the Holder or any of the other
Attribution Parties and (B) exercise or conversion of the unexercised or non-converted portion of any other securities of the Company
(including the Other Notes, or convertible preferred stock or warrants, including, without limitation, the Warrants and the Additional
Warrants (if issued) ) beneficially owned by the Holder or any other Attribution Party subject to a limitation on conversion or exercise
analogous to the limitation contained in this Section 3(d). For purposes of this Section 3(d), beneficial ownership shall be calculated
in accordance with Section 13(d) of the Exchange Act. For purposes of determining the number of outstanding shares of Common Stock the
Holder may acquire upon the conversion of this Note without exceeding the Maximum Percentage, the Holder may rely on the number of outstanding
shares of Common Stock as reflected in (x) the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q,
Current Report on Form 8-K or other public filing with the SEC, as the case may be, (y) a more recent public announcement by the Company
or (z) any other written notice by the Company or the Transfer Agent, if any, setting forth the number of shares of Common Stock outstanding
(the “Reported Outstanding Share Number”). If the Company receives a Conversion Notice from the Holder at a time when
the actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number, the Company shall notify
the Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Conversion Notice would otherwise
cause the Holder’s beneficial ownership, as determined pursuant to this Section 3(d), to exceed the Maximum Percentage, the Holder
must notify the Company of a reduced number of shares of Common Stock to be purchased pursuant to such Conversion Notice. For any reason
at any time, upon the written or oral request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing
or by electronic mail to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares
of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Note,
by the Holder and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event
that the issuance of shares of Common Stock to the Holder upon conversion of this Note results in the Holder and the other Attribution
Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common
Stock (as determined under Section 13(d) of the Exchange Act), the number of shares so issued by which the Holder’s and the other
Attribution Parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall
be deemed null and void and shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the Excess Shares.
Upon delivery of a written notice to the Company, the Holder may from time to time increase (with such increase not effective until the
sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess
of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first
(61st) day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder
and the other Attribution Parties and not to any other holder of Notes that is not an Attribution Party of the Holder. For purposes of
clarity, the shares of Common Stock issuable pursuant to the terms of this Note in excess of the Maximum Percentage shall not be deemed
to be beneficially owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the Exchange Act.
No prior inability to convert this Note pursuant to this paragraph shall have any effect on the applicability of the provisions of this
paragraph with respect to any subsequent determination of convertibility. The provisions of this paragraph shall be construed and implemented
in a manner otherwise than in strict conformity with the terms of this Section 3(d) to the extent necessary to correct this paragraph
(or any portion of this paragraph) which may be defective or inconsistent with the intended beneficial ownership limitation contained
in this Section 3(d) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation
contained in this paragraph may not be waived and shall apply to a successor holder of this Note.


 




    	-7-



     


    

 


4.
RIGHTS UPON EVENT OF DEFAULT.


 


(a)
Event of Default. Each of the following events shall constitute an “Event of Default” and each of the events
in clauses (vii), (viii) and (ix) shall constitute a “Bankruptcy Event of Default”:


 


(i)
the suspension from trading or the failure of the Common Stock to be trading or listed (as applicable) on an Eligible Market for a period
of ten (10) consecutive Trading Days;


 


(ii)
the Company’s notice, written or oral, to the Holder or any holder of the Other Notes (if issued) , or to any holder of Warrants
or holder of Additional Warrants (if issued), including, without limitation, by way of public announcement or through any of its agents,
at any time, of its intention not to comply, as required, with a request for conversion of this Note or any Other Notes (as applicable)
into shares of Common Stock that is requested in accordance with the provisions of this Note or the Other Notes (as applicable), other
than pursuant to Section 3(d), or a request for exercise of any Warrants or any Additional Warrants (as applicable) for shares of Common
Stock in accordance with the provisions of the Warrants or the Additional Warrants (as applicable);


 


(iii)
at any time following the tenth (10th) consecutive Trading Day that the number of shares of Common Stock reserved by the Company
for conversions of this Note and the Warrants is less than (A) the number of shares of Common Stock that the Holder would be entitled
to receive upon a conversion of the full Conversion Amount of this Note (without regard to any limitations on conversion set forth in
Section 3(c)(vi) or otherwise), and (B) the number of shares of Common Stock that the Holder would be entitled to receive upon exercise
in full of the Holder’s Warrants (without regard to any limitations on exercise set forth in the Warrants);


 


(iv)
the Company’s or any Subsidiary’s failure to pay to the Holder any amount of Principal, Interest, Late Charges or other amounts
when and as due under this Note (including, without limitation, the Company’s or any Subsidiary’s failure to pay any redemption
payments or amounts hereunder) or any other agreement, document, certificate or other instrument delivered in connection with the transactions
contemplated hereby and thereby, except, in the case of a failure to pay Interest and Late Charges when and as due, in which case only
if such failure remains uncured for a period of at least two (2) Trading Days;


 




    	-8-



     


    

 


(v)
the Company either (A) fails to cure a Conversion Failure or a Delivery Failure (as defined in the Warrants) by delivery of the required
number of shares of Common Stock within three (3) Trading Days after the applicable Conversion Date or exercise date (as the case may
be) or (B) fails to remove any restrictive legend on any certificate or any shares of Common Stock issued to the Holder upon conversion
or exercise (as the case may be) of any Securities (as defined in the Purchase Agreement) acquired by the Holder under the Exchange Agreement
(including this Note) as and when required by such Securities or the Exchange Agreement, unless otherwise then prohibited by applicable
federal securities laws, and any such failure remains uncured for at least three (3) Trading Days;


 


(vi)
the occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $100,000 of Indebtedness
(as defined in the Purchase Agreement) of the Company or any of its Subsidiaries, other than with respect to this Note or any Other Notes
or any notes issued pursuant to the Purchase Agreement;


 


(vii)
bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted
by or against the Company or any Subsidiary and, if instituted against the Company or any Subsidiary by a third party, shall not be dismissed
within thirty (30) days of their initiation;


 


(viii)
the commencement by the Company or any Subsidiary of a voluntary case or proceeding under any applicable federal, state or foreign bankruptcy,
insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the
consent by it to the entry of a decree, order, judgment or other similar document in respect of the Company or any Subsidiary in an involuntary
case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking
reorganization or relief under any applicable federal, state or foreign law, or the consent by it to the filing of such petition or to
the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official
of the Company or any Subsidiary or of any substantial part of its property, or the making by it of an assignment for the benefit of
creditors, or the execution of a composition of debts, or the occurrence of any other similar federal, state or foreign proceeding, or
the admission by it in writing of its inability to pay its debts generally as they become due, the taking of corporate action by the
Company or any Subsidiary in furtherance of any such action or the taking of any action by any Person to commence a Uniform Commercial
Code foreclosure sale or any other similar action under federal, state or foreign law;


 




    	-9-



     


    

 


(ix)
the entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company or any Subsidiary of a voluntary
or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other similar
law or (ii) a decree, order, judgment or other similar document adjudging the Company or any Subsidiary as bankrupt or insolvent, or
approving as properly filed a petition seeking liquidation, reorganization, arrangement, adjustment or composition of or in respect of
the Company or any Subsidiary under any applicable federal, state or foreign law or (iii) a decree, order, judgment or other similar
document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or any
Subsidiary or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance
of any such decree, order, judgment or other similar document or any such other decree, order, judgment or other similar document unstayed
and in effect for a period of thirty (30) consecutive days;


 


(x)
a final judgment or judgments for the payment of money aggregating in excess of $100,000 are rendered against the Company and/or any
of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged, settled or stayed
pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, any judgment which
is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $100,000 amount set forth
above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which written statement
shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an indemnity and the Company
or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within thirty (30) days of the issuance
of such judgment;


 


(xi)
the Company and/or any Subsidiary, individually or in the aggregate, either (i) fails to pay, when due, or within any applicable grace
period, any payment with respect to any Indebtedness in excess of $100,000 due to any third party (other than, with respect to unsecured
Indebtedness only, payments contested by the Company and/or such Subsidiary (as the case may be) in good faith by proper proceedings
and with respect to which adequate reserves have been set aside for the payment thereof in accordance with GAAP) or is otherwise in breach
or violation of any agreement for monies owed or owing in an amount in excess of $100,000, which breach or violation permits the other
party thereto to declare a default or otherwise accelerate amounts due thereunder, or (ii) suffer to exist any other circumstance or
event that would, with or without the passage of time or the giving of notice, result in a default or event of default under any agreement
binding the Company or any Subsidiary, which default or event of default would or is likely to have a material adverse effect on the
business, assets, operations (including results thereof), liabilities, properties, condition (including financial condition) or prospects
of the Company or any of its Subsidiaries, individually or in the aggregate;


 


(xii)
other than as specifically set forth in another clause of this Section 4(a), the Company or any Subsidiary breaches any representation
or warranty in any material respect (other than the representations or warranties subject to material adverse effect or materiality limitations,
which may not be breached in any respect) or any covenant or other term or condition of any Transaction Document, except, in the case
of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured for a period of five (5) consecutive
Trading Days;


 


(xiii)
a materially false or inaccurate certification (including a materially false or inaccurate deemed certification) by the Company as to
whether any Event of Default has occurred;


 


(xiv)
any breach or failure in any respect by the Company or any Subsidiary to comply with any provision of Section 11 of this Note;


 


(xv)
any Material Adverse Effect (as defined in the Purchase Agreement) occurs;


 


(xvi)
if the Qualified Offering Date relating to a Qualified Offering shall not have occurred prior to the Maturity Date of this Note;


 


(xvii)
any material provision of any Transaction Document shall at any time for any reason (other than pursuant to the express terms thereof)
cease to be valid and binding on or enforceable against the parties thereto in any material respect, or the validity or enforceability
thereof shall be contested by any party thereto, or a proceeding shall be commenced by the Company or any Subsidiary or any governmental
authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability thereof, or the Company or any
Subsidiary shall deny in writing that it has any liability or obligation purported to be created under any Transaction Document; or


 


(xviii)
any Event of Default (as defined in the Other Notes) occurs with respect to any Other Notes.


 




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(b)
Notice of an Event of Default; Redemption Right. Upon the occurrence of an Event of Default with respect to this Note or any Other
Note, the Company shall within one (1) Business Day of becoming aware of such Event of Default deliver written notice thereof via facsimile
or electronic mail and overnight courier (with next day delivery specified) (an “Event of Default Notice”) to the
Holder. The Event of Default Notice shall include (i) a reasonable description of the applicable Event of Default, (ii) a certification
as to whether, in the opinion of the Company, such Event of Default is capable of being cured and, if applicable, a reasonable description
of any existing plans of the Company to cure such Event of Default, and (iii) a certification as to the date on which such Event of Default
initially occurred and, if cured on or prior to the date of such Event of Default Notice, the applicable Event of Default Right Expiration
Date (as defined below), which Event of Default Right Expiration Date shall not occur prior to the fifteenth (15th) calendar
day immediately following the date on which such Event of Default initially occurred. At any time after the earlier of (X) the date of
receipt by the Holder of an Event of Default Notice and (Y) the date the Holder becomes aware of an Event of Default (such earlier date,
an “Event of Default Right Commencement Date”), and ending on the later of (I) the fifteenth (15th) calendar
day immediately following the date on which such Event of Default initially occurred, (II) the date such Event of Default is cured and
(III) the date of receipt by the Holder of an Event of Default Notice (such ending date, an “Event of Default Right Expiration
Date”, and each such period following the occurrence of an Event of Default with respect to this Note or any Other Note, an
“Event of Default Redemption Right Period”), the Holder may require the Company to redeem all or any portion of this
Note by delivering written notice thereof (an “Event of Default Redemption Notice”) to the Company, which Event of
Default Redemption Notice shall indicate the portion of this Note the Holder is electing to require the Company to redeem. Each portion
of this Note subject to redemption by the Company pursuant to this Section 4(b) shall be redeemed by the Company at a price equal to
the product of (i) the Conversion Amount to be redeemed multiplied by (ii) the Event of Default Redemption Premium (the “Event
of Default Redemption Price”). Redemptions required by this Section 4(b) shall be made in accordance with the provisions of
Section 9. To the extent redemptions required by this Section 4(b) are deemed or determined by a court of competent jurisdiction to be
prepayments of this Note by the Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the
contrary in this Section 4, but subject to Section 3(c)(vi), until the Event of Default Redemption Price (together with any Late Charges
thereon) is paid in full, the Conversion Amount submitted for redemption under this Section 4(b) (together with any Late Charges thereon)
may be converted, in whole or in part, by the Holder into Common Stock pursuant to Section 3. In the event of the Company’s redemption
of any portion of this Note under this Section 4(b), the Holder’s damages would be uncertain and difficult to estimate because
of the parties’ inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment
opportunity for the Holder. Accordingly, any Event of Default Redemption Premium due under this Section 4(b) is intended by the parties
to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its investment opportunity and not as a penalty.
Any redemption upon an Event of Default shall not constitute an election of remedies by the Holder, and all other rights and remedies
of the Holder shall be preserved.


 


(c)
Mandatory Redemption upon Bankruptcy Event of Default. Notwithstanding anything to the contrary herein, and notwithstanding any
conversion that is then required or in process, upon any Bankruptcy Event of Default, whether occurring prior to or following the Maturity
Date, the Company shall immediately pay to the Holder an amount in cash representing (a) all outstanding Principal, accrued and unpaid
Interest and accrued and unpaid Late Charges on such Principal and Interest and any and all other amounts due hereunder multiplied (b)
by the Event of Default Redemption Premium, without the requirement for any notice or demand or other action by the Holder or any other
person or entity; provided that the Holder may, in its sole discretion, waive such right to receive payment upon a Bankruptcy Event of
Default, in whole or in part, and any such waiver shall not affect any other rights of the Holder hereunder, including any other rights
in respect of such Bankruptcy Event of Default, any right to conversion, and any right to payment of the Event of Default Redemption
Price or any other Redemption Price, as applicable.


 




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5.
RIGHTS UPON FUNDAMENTAL TRANSACTION.


 


(a)
Assumption. The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes
in writing all of the obligations of the Company under this Note and the other Transaction Documents in accordance with the provisions
of this Section 5(a) pursuant to written agreements in form and substance satisfactory to the Holder and approved by the Holder prior
to such Fundamental Transaction, including agreements to deliver to each holder of Notes in exchange for such Notes a security of the
Successor Entity evidenced by a written instrument substantially similar in form and substance to the Notes, including, without limitation,
having a principal amount and interest rate equal to the principal amounts then outstanding and the interest rates of the Notes, respectively,
held by such holder, having similar conversion rights as the Notes and having similar ranking and security to the Notes, and satisfactory
to the Holder and (ii) the Successor Entity is a publicly traded corporation whose common stock is quoted on or listed for trading on
an Eligible Market. Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for
(so that from and after the date of such Fundamental Transaction, the provisions of this Note and the other Transaction Documents referring
to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and
shall assume all of the obligations of the Company under this Note and the other Transaction Documents with the same effect as if such
Successor Entity had been named as the Company herein. Upon consummation of a Fundamental Transaction, the Successor Entity shall deliver
to the Holder confirmation that there shall be issued upon conversion or redemption of this Note at any time after the consummation of
such Fundamental Transaction, in lieu of the shares of Common Stock or other securities, cash, assets or other property (except such
items still issuable under Sections 6 and 12, which shall continue to be receivable thereafter) issuable upon the conversion or redemption
of the Notes prior to such Fundamental Transaction, such shares of the publicly traded common stock (or their equivalent) of the Successor
Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening of such Fundamental Transaction
had this Note been converted immediately prior to such Fundamental Transaction (without regard to any limitations on the conversion of
this Note), as adjusted in accordance with the provisions of this Note. Notwithstanding the foregoing, the Holder may elect, at its sole
option, by delivery of written notice to the Company to waive this Section 5(a) to permit the Fundamental Transaction without the assumption
of this Note. The provisions of this Section 5(a) shall apply similarly and equally to successive Fundamental Transactions and shall
be applied without regard to any limitations on the conversion of this Note.


 




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(b)
Notice of a Change of Control; Redemption Right. No sooner than twenty (20) Trading Days nor later than ten (10) Trading Days
prior to the consummation of a Change of Control (the “Change of Control Date”), but not prior to the public announcement
of such Change of Control, the Company shall deliver written notice thereof via facsimile or electronic mail and overnight courier to
the Holder (a “Change of Control Notice”). At any time during the period beginning after the Holder’s receipt
of a Change of Control Notice or the Holder becoming aware of a Change of Control if a Change of Control Notice is not delivered to the
Holder in accordance with the immediately preceding sentence (as applicable) and ending on the later of twenty (20) Trading Days after
(A) consummation of such Change of Control or (B) the date of receipt of such Change of Control Notice, the Holder may require the Company
to redeem all or any portion of this Note by delivering written notice thereof (“Change of Control Redemption Notice”)
to the Company, which Change of Control Redemption Notice shall indicate the Conversion Amount the Holder is electing to redeem. The
portion of this Note subject to redemption pursuant to this Section 5(b) shall be redeemed by the Company in cash at a price equal to
the product of (i) the Change of Control Redemption Premium multiplied by (ii) the Conversion Amount being redeemed (the “Change
of Control Redemption Price”). Redemptions required by this Section 5(b) shall be made in accordance with the provisions of
Section 9 and shall have priority to payments to stockholders in connection with such Change of Control. To the extent redemptions required
by this Section 4(c)(b) are deemed or determined by a court of competent jurisdiction to be prepayments of this Note by the Company,
such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section 5(b), but subject
to Section 3(c)(vi), until the Change of Control Redemption Price (together with any Late Charges thereon) is paid in full, the Conversion
Amount submitted for redemption under this Section 5(b) (together with any Late Charges thereon) may be converted, in whole or in part,
by the Holder into Common Stock pursuant to Section 3. In the event of the Company’s redemption of any portion of this Note under
this Section 5(b), the Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to
predict future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for the Holder.
Accordingly, any Change of Control Redemption Premium due under this Section 5(b) is intended by the parties to be, and shall be deemed,
a reasonable estimate of the Holder’s actual loss of its investment opportunity and not as a penalty.


 


(c)
Qualified Offering. No later than one (1) Trading Day immediately prior to the Qualified Offering Date, the Company shall deliver
written notice thereof via facsimile or electronic mail and overnight courier to the Holder (a “Qualified Offering Notice”),
which shall include (i) the Company’s reasonable estimate of the amount of Qualified Offering Proceeds for such Qualified Offering,
(ii) the Public Offering Price Per Share in such Qualified Offering, (iii) a calculation of the Fixed Conversion Price in effect as of
the Qualified Offering Date, giving effect to any adjustment to the Fixed Conversion Price as a result of such Qualified Offering. At
any time beginning on the second (2nd) Trading Day immediately following the Qualified Offering Date, the Company may, at
its sole option and in its sole discretion, redeem (a “Qualified Offering Redemption”), all or part of the Conversion
Amount of this Note (the “Qualified Offering Redemption Amount”) by delivering written notice thereof (the “Qualified
Offering Redemption Notice”) to the Holder. The Qualified Offering Redemption Notice shall state (i) the Qualified Offering
Redemption Amount to be redeemed in such Qualified Offering Redemption pursuant to this Section 5(c), (ii) the date the Company is required
to pay to the Holder the Qualified Offering Redemption Price (as defined below) (the “Qualified Offering Redemption Date”),
which date shall be no earlier than fifteen (15) calendar days following the date of delivery of such Qualified Offering Redemption Notice.
Each portion of this Note subject to redemption pursuant to this Section 5(c) shall be redeemed by the Company in cash at a price equal
to the product of (i) the Qualified Offering Redemption Premium multiplied by (ii) the Qualified Offering Redemption Amount (the “Qualified
Offering Redemption Price”). Redemptions required by this Section 5(c) shall be made in accordance with the provisions of Section
9. Notwithstanding anything herein to the contrary, but subject to Section 3(d), at any time prior to the date the Qualified Offering
Redemption Price (together with any Late Charges thereon) is paid, in full, the Qualified Offering Redemption Amount may be converted,
in whole or in part, by the Holder, at its option and in its sole discretion, into Common Stock pursuant to Section 3; provided,
however, that if the Qualified Offering involves the sale of Common Stock together with any Options or Convertible Securities,
in any combination thereof, as a unit, the Qualified Offering Redemption Amount may be converted, in whole or in part, by the Holder,
at its option and in its sole discretion, into such units at the Conversion Price in effect immediately following the consummation of
such Qualified Offering, giving effect to any adjustment to the Fixed Conversion Price in effect immediately prior thereto as a result
of the issuance of securities by the Company in such Qualified Offering and the consummation thereof on the Qualified Offering Date.
To the extent redemptions required by this Section 5(c) are deemed or determined by a court of competent jurisdiction to be prepayments
of the Note by the Company, such redemptions shall be deemed to be voluntary prepayments.


 




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6.
RIGHTS UPON ISSUANCE OF PURCHASE RIGHTS AND OTHER CORPORATE EVENTS.


 


(a)
Purchase Rights. In addition to any adjustments pursuant to Section 7 below, if at any time the Company grants, issues or sells
any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to all or substantially
all of the record holders of any class of Common Stock (the “Purchase Rights”), then the Holder will be entitled to
acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the
Holder had held the number of shares of Common Stock acquirable upon complete conversion of this Note (without taking into account any
limitations or restrictions on the convertibility of this Note and assuming for such purpose that the Note was converted at the Conversion
Price as of the applicable record date) immediately prior to the date on which a record is taken for the grant, issuance or sale of such
Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined
for the grant, issue or sale of such Purchase Rights (provided, however, that to the extent that the Holder’s right
to participate in any such Purchase Right would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage,
then the Holder shall not be entitled to participate in such Purchase Right to the extent of the Maximum Percentage (and shall not be
entitled to beneficial ownership of such shares of Common Stock as a result of such Purchase Right (and beneficial ownership) to the
extent of any such excess) and such Purchase Right to such extent shall be held in abeyance (and, if such Purchase Right has an expiration
date, maturity date or other similar provision, such term shall be extended by such number of days held in abeyance, if applicable) for
the benefit of the Holder until such time or times, if ever, as its right thereto would not result in the Holder and the other Attribution
Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such right (and any Purchase Right granted,
issued or sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance (and, if such Purchase Right
has an expiration date, maturity date or other similar provision, such term shall be extended by such number of days held in abeyance,
if applicable)) to the same extent as if there had been no such limitation).


 


(b)
Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any
Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other assets with respect
to or in exchange for shares of Common Stock (a “Corporate Event”), the Company shall make appropriate provision to
ensure that the Holder will thereafter have the right to receive upon a conversion of this Note, at the Holder’s option (i) in
addition to the shares of Common Stock receivable upon such conversion, such securities or other assets to which the Holder would have
been entitled with respect to such shares of Common Stock had such shares of Common Stock been held by the Holder upon the consummation
of such Corporate Event (without taking into account any limitations or restrictions on the convertibility of this Note) or (ii) in lieu
of the shares of Common Stock otherwise receivable upon such conversion, such securities or other assets received by the holders of shares
of Common Stock in connection with the consummation of such Corporate Event in such amounts as the Holder would have been entitled to
receive had this Note initially been issued with conversion rights for the form of such consideration (as opposed to shares of Common
Stock) at a conversion rate for such consideration commensurate with the Conversion Rate. Provision made pursuant to the preceding sentence
shall be in a form and substance satisfactory to the Holder. The provisions of this Section 6 shall apply similarly and equally to successive
Corporate Events and shall be applied without regard to any limitations on the conversion or redemption of this Note.


 


7.
RIGHTS UPON ISSUANCE OF OTHER SECURITIES.


 


(a)
Adjustment of Fixed Conversion Price upon Dilutive Issuance. If and whenever on or after the Exchange Date the Company issues
or sells, or in accordance with this Section 7(a) is deemed to have issued or sold, any shares of Common Stock (including the issuance
or sale of shares of Common Stock owned or held by or for the account of the Company, but excluding any Excluded Securities (as defined
in the Purchase Agreement) issued or sold or deemed to have been issued or sold) for a consideration per share (the “New Issuance
Price”) less than a price equal to the Fixed Conversion Price in effect immediately prior to such issuance or sale or deemed
issuance or sale (such Fixed Conversion Price then in effect is referred to herein as the “Applicable Price”) (the
foregoing a “Dilutive Issuance”), then, immediately after such Dilutive Issuance, the Fixed Conversion Price then
in effect shall be reduced to an amount equal to the New Issuance Price. For all purposes of the foregoing (including, without limitation,
determining the adjusted Fixed Conversion Price and the New Issuance Price under this Section 7(a)), the following shall be applicable:


 


(i)
Issuance of Options. If the Company in any manner grants or sells any Options and the lowest price per share for which one share
of Common Stock is at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Convertible
Securities issuable upon exercise of any such Option or otherwise pursuant to the terms thereof is less than the Applicable Price, then
such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the granting
or sale of such Option for such price per share. For purposes of this Section 7(a)(i), the “lowest price per share for which one
share of Common Stock is at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Convertible
Securities issuable upon exercise of any such Option or otherwise pursuant to the terms thereof” shall be equal to (1) the lower
of (x) the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to any one share of
Common Stock upon the granting or sale of such Option, upon exercise of such Option and upon conversion, exercise or exchange of any
Convertible Security issuable upon exercise of such Option or otherwise pursuant to the terms thereof and (y) the lowest exercise price
set forth in such Option for which one share of Common Stock is issuable (or may become issuable assuming all possible market conditions)
upon the exercise of any such Options or upon conversion, exercise or exchange of any Convertible Securities issuable upon exercise of
any such Option or otherwise pursuant to the terms thereof, minus (2) the sum of all amounts paid or payable to the holder of such Option
(or any other Person) with respect to any one share of Common Stock upon the granting or sale of such Option, upon exercise of such Option
and upon conversion, exercise or exchange of any Convertible Security issuable upon exercise of such Option or otherwise pursuant to
the terms thereof plus the value of any other consideration consisting of cash, debt forgiveness, assets or any other property received
or receivable by, or benefit conferred on, the holder of such Option (or any other Person). Except as contemplated below, no further
adjustment of the Fixed Conversion Price shall be made upon the actual issuance of such share of Common Stock or of such Convertible
Securities upon the exercise of such Options or otherwise pursuant to the terms thereof or upon the actual issuance of such shares of
Common Stock upon conversion, exercise or exchange of such Convertible Securities.


 








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(ii)
Issuance of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities and the lowest price
per share for which one share of Common Stock is at any time issuable upon the conversion, exercise or exchange thereof or otherwise
pursuant to the terms thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and
to have been issued and sold by the Company at the time of the issuance or sale of such Convertible Securities for such price per share.
For the purposes of this Section 7(a)(ii), the “lowest price per share for which one share of Common Stock is at any time issuable
(or may become issuable assuming all possible market conditions) upon the conversion, exercise or exchange thereof or otherwise pursuant
to the terms thereof” shall be equal to (1) the lower of (x) the sum of the lowest amounts of consideration (if any) received or
receivable by the Company with respect to one share of Common Stock upon the issuance or sale of the Convertible Security and upon conversion,
exercise or exchange of such Convertible Security or otherwise pursuant to the terms thereof and (y) the lowest conversion price set
forth in such Convertible Security for which one share of Common Stock is issuable upon conversion, exercise or exchange thereof or otherwise
pursuant to the terms thereof minus (2) the sum of all amounts paid or payable to the holder of such Convertible Security (or any other
Person) with respect to any one share of Common Stock upon the issuance or sale of such Convertible Security plus the value of any other
consideration received or receivable consisting of cash, debt forgiveness, assets or other property by, or benefit conferred on, the
holder of such Convertible Security (or any other Person). Except as contemplated below, no further adjustment of the Fixed Conversion
Price shall be made upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange of such Convertible
Securities or otherwise pursuant to the terms thereof, and if any such issuance or sale of such Convertible Securities is made upon exercise
of any Options for which adjustment of the Fixed Conversion Price has been or is to be made pursuant to other provisions of this Section
7(a), except as contemplated below, no further adjustment of the Fixed Conversion Price shall be made by reason of such issuance or sale.


 


(iii)
Change in Option Price or Rate of Conversion. If the purchase or exercise price provided for in any Options, the additional consideration,
if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exercisable or exchangeable for shares of Common Stock increases or decreases at any time (other than
proportional changes in conversion or exercise prices, as applicable, in connection with an event referred to in Section 7(b) below),
the Fixed Conversion Price in effect at the time of such increase or decrease shall be adjusted to the Fixed Conversion Price which would
have been in effect at such time had such Options or Convertible Securities provided for such increased or decreased purchase price,
additional consideration or increased or decreased conversion rate (as the case may be) at the time initially granted, issued or sold.
For purposes of this Section 7(a)(iii), if the terms of any Option or Convertible Security that was outstanding as of the Exchange Date
are increased or decreased in the manner described in the immediately preceding sentence, then such Option or Convertible Security and
the shares of Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the
date of such increase or decrease. No adjustment pursuant to this Section 7(a) shall be made if such adjustment would result in an increase
of the Fixed Conversion Price then in effect.


 


(iv)
Calculation of Consideration Received. If any shares of Common Stock, Option or Convertible Securities are sold in an offering
(other than a Qualified Offering) as an integrated unit, the consideration received will be apportioned among the securities offered
according to the value their fair market value as determined jointly by the Company and the holders of at least a majority of Principal
of this Note and the Other Notes (“Majority in Interest”). If any shares of Common Stock, Options or Convertible Securities
are issued or sold or deemed to have been issued or sold for cash, the consideration received therefor will be deemed to be the net amount
of consideration received by the Company therefor. If any shares of Common Stock, Options or Convertible Securities are issued or sold
for a consideration other than cash, the amount of such consideration received by the Company will be the fair value of such consideration,
except where such consideration consists of publicly traded securities, in which case the amount of consideration received by the Company
for such securities will be the arithmetic average of the VWAPs of such security for each of the five (5) Trading Days immediately preceding
the date of receipt. If any shares of Common Stock, Options or Convertible Securities are issued to the owners of the non-surviving entity
in connection with any merger in which the Company is the surviving entity, the amount of consideration therefor will be deemed to be
the fair value of such portion of the net assets and business of the non-surviving entity as is attributable to such shares of Common
Stock, Options or Convertible Securities (as the case may be). The fair value of any consideration other than cash or publicly traded
securities will be determined jointly by the Company and the Majority in Interest. If such parties are unable to reach agreement within
ten (10) days after the occurrence of an event requiring valuation (the “Valuation Event”), the fair value of such
consideration will be determined within five (5) Business Days after the tenth (10th) day following the Valuation Event by an independent,
reputable appraiser jointly selected by the Company and the Majority in Interest. The determination of such appraiser shall be final
and binding upon all parties absent manifest error and the fees and expenses of such appraiser shall be borne by the Company.


 




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(b)
Adjustment of Fixed Conversion Price upon Subdivision or Combination of Common Stock. Without limiting any provision of Section
5(a), Section 5(b) or Section 7(a) if the Company at any time on or after the Exchange Date subdivides (by any stock split, stock dividend,
stock combination, recapitalization or other similar transaction) one or more classes of its outstanding shares of Common Stock into
a greater number of shares, the Fixed Conversion Price in effect immediately prior to such subdivision will be proportionately reduced.
Without limiting any provision of Section 5(a), Section 5(b) or Section 7(a), if the Company at any time on or after the Exchange Date
combines (by any stock split, stock dividend, stock combination, recapitalization or other similar transaction) one or more classes of
its outstanding shares of Common Stock into a smaller number of shares, the Fixed Conversion Price in effect immediately prior to such
combination will be proportionately increased. Any adjustment pursuant to this Section 7(b) shall become effective immediately after
the effective date of such subdivision or combination. If any event requiring an adjustment under this Section 7(b) occurs during the
period that a Fixed Conversion Price is calculated hereunder, then the calculation of such Fixed Conversion Price shall be adjusted appropriately
to reflect such event.


 


(c)
Holder’s Right of Adjusted Conversion Price. If the Company in any manner issues or sells or enters into any agreement to
issue or sell, any Common Stock, Options or Convertible Securities (any such securities, “Variable Price Securities”)
after the Exchange Date that are issuable pursuant to such agreement or convertible into or exchangeable or exercisable for shares of
Common Stock pursuant to such Options or Convertible Securities, as applicable, at a price which varies or may vary with the market price
of the shares of Common Stock, including by way of one or more reset(s) to a fixed price, but exclusive of such formulations reflecting
customary anti-dilution provisions (such as share splits, share combinations, share dividends and similar transactions) (each of the
formulations for such variable price being herein referred to as, the “Variable Price”), the Company shall provide
written notice thereof via facsimile or electronic mail and overnight courier to the Holder on the date of such agreement and/or the
issuance of such Convertible Securities or Options, as applicable. From and after the date the Company enters into such agreement or
issues any such Variable Price Securities, the Holder shall have the right, but not the obligation, in its sole discretion to substitute
the Variable Price for the Conversion Price upon conversion of this Note by designating in the Conversion Notice delivered upon any conversion
of this Note that solely for purposes of such conversion the Holder is relying on the Variable Price rather than the Conversion Price
then in effect. The Holder’s election to rely on a Variable Price for a particular conversion of this Note shall not obligate the
Holder to rely on a Variable Price for any future conversion of this Note.


 


(d)
Other Events. In the event that the Company (or any Subsidiary) shall take any action to which the provisions hereof are not strictly
applicable, or, if applicable, would not operate to protect the Holder from dilution or if any event occurs of the type contemplated
by the provisions of this Section 7 but not expressly provided for by such provisions (including, without limitation, the granting of
stock settled stock appreciation rights, phantom stock rights or other rights with equity features), then the Company’s board of
directors shall in good faith determine and implement an appropriate adjustment in the Fixed Conversion Price so as to protect the rights
of the Holder, provided that no such adjustment pursuant to this Section 7(d) will increase the Fixed Conversion Price as otherwise determined
pursuant to this Section 7, provided further that if the Holder does not accept such adjustments as appropriately protecting its interests
hereunder against such dilution, then the Company’s board of directors and the Holder shall agree, in good faith, upon an independent
investment bank of nationally recognized standing to make such appropriate adjustments, whose determination shall be final and binding
absent manifest error and whose fees and expenses shall be borne by the Company.


 


(e)
Calculations. All calculations under this Section 7 shall be made by rounding to the nearest cent or the nearest 1/100th
of a share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or
held by or for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Common Stock.


 


(f)
Voluntary Adjustment by Company. The Company may at any time during the term of this Note, with the prior written consent of the
Required Holders, reduce the then current Fixed Conversion Price of each of the Notes to any amount and for any period of time deemed
appropriate by the board of directors of the Company.


 




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8.
NONCIRCUMVENTION; RESERVATION OF SHARES.


 


(a)
Non-Circumvention. The Company hereby covenants and agrees that the Company will not, by amendment of its Charter (as defined
in the Purchase Agreement), Bylaws (as defined in the Purchase Agreement) or through any reorganization, transfer of assets, consolidation,
merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Note, and will at all times in good faith carry out all of the provisions of this Note and
take all action as may be required to protect the rights of the Holder of this Note. Without limiting the generality of the foregoing
or any other provision of this Note or the other Transaction Documents, the Company (a) shall not increase the par value of any shares
of Common Stock receivable upon conversion of this Note above the Conversion Price then in effect, and (b) shall take all such actions
as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of Common
Stock upon the conversion of this Note. Notwithstanding anything herein to the contrary, if after the sixty (60) calendar day anniversary
of the Issuance Date, the Holder is not permitted to convert this Note in full for any reason (other than pursuant to restrictions set
forth in Section 3(d) hereof), the Company shall use its best efforts to promptly remedy such failure, including, without limitation,
obtaining such consents or approvals as necessary to permit such conversion into shares of Common Stock.


 


(b)
Reservation. So long as any Notes remain outstanding, the Company shall at all times reserve at least the number of shares of
Common Stock as shall from time to time be necessary to effect the conversion of all of the Notes then outstanding (without regard to
any limitations on conversions and assuming such Notes remain outstanding until the Maturity Date) (the “Required Reserve Amount”).
The Required Reserve Amount (including, without limitation, each increase in the number of shares so reserved) shall be allocated pro
rata among the holders of the Notes based on the original principal amount of the Notes held by each holder on the Closing Date or increase
in the number of reserved shares, as the case may be (the “Authorized Share Allocation”). In the event that a holder
shall sell or otherwise transfer any of such holder’s Notes, each transferee shall be allocated a pro rata portion of such holder’s
Authorized Share Allocation.


 


(c)
Insufficient Authorized Shares. If, notwithstanding Section 8(b), and not in limitation thereof, at any time while any of the
Notes remain outstanding the Company does not have a sufficient number of authorized and unreserved shares of Common Stock to satisfy
its obligation to reserve for issuance upon conversion of the Notes at least a number of shares of Common Stock equal to the Required
Reserve Amount (an “Authorized Share Failure”), then the Company shall immediately take all action necessary to increase
the Company’s authorized shares of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount
for the Notes then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the
occurrence of an Authorized Share Failure, but in no event later than sixty (60) days after the occurrence of such Authorized Share Failure,
the Company shall hold a meeting of its stockholders for the approval of an increase in the number of authorized shares of Common Stock.
In connection with such meeting, the Company shall provide each stockholder with a proxy statement and shall use its best efforts to
solicit its stockholders’ approval of such increase in authorized shares of Common Stock and to cause its board of directors to
recommend to the stockholders that they approve such proposal. In the event that the Company is prohibited from issuing shares of Common
Stock pursuant to the terms of this Note due to the failure by the Company to have sufficient shares of Common Stock available out of
the authorized but unissued shares of Common Stock (such unavailable number of shares of Common Stock, the “Authorized Failure
Shares”), in lieu of delivering such Authorized Failure Shares to the Holder, the Company shall pay cash in exchange for the
redemption of such portion of the Conversion Amount convertible into such Authorized Failure Shares at a price equal to the sum of (i)
the product of (x) such number of Authorized Failure Shares and (y) the greatest Closing Sale Price of the Common Stock on any Trading
Day during the period commencing on the date the Holder delivers the applicable Conversion Notice with respect to such Authorized Failure
Shares to the Company and ending on the date of such issuance and payment under this Section 8(c); and (ii) to the extent the Holder
purchases (in an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of Authorized
Failure Shares, any brokerage commissions and other out-of-pocket expenses, if any, of the Holder incurred in connection therewith.


 




    	-17-



     


    

 


9.
REDEMPTIONS.


 


(a)
Mechanics. The Company shall deliver the applicable Event of Default Redemption Price to the Holder in cash within five (5) Business
Days after the Company’s receipt of the Holder’s Event of Default Redemption Notice. If the Holder has submitted a Change
of Control Redemption Notice in accordance with Section 5(b), the Company shall deliver the applicable Change of Control Redemption Price
to the Holder (i) concurrently with the consummation of such Change of Control if such notice is received prior to the consummation of
such Change of Control and (ii) within five (5) Business Days after the Company’s receipt of such notice otherwise. The Company
shall deliver the Qualified Offering Redemption Price to the Holder in cash on the applicable Qualified Offering Redemption Date. Notwithstanding
anything herein to the contrary, in connection with any redemption hereunder at a time the Holder is entitled to receive a cash payment
under any of the other Transaction Documents, at the option of the Holder delivered in writing to the Company, the applicable Redemption
Price hereunder shall be increased by the amount of such cash payment owed to the Holder under such other Transaction Document and, upon
payment in full or conversion in accordance herewith, shall satisfy the Company’s payment obligation under such other Transaction
Document. In the event of a redemption of less than all of the Conversion Amount of this Note, the Company shall promptly cause to be
issued and delivered to the Holder a new Note (in accordance with Section 15(d)) representing the outstanding Principal which has not
been redeemed.


 


(b)
Default. In the event that the Company does not pay the applicable Redemption Price to the Holder within the time period required,
at any time thereafter and until the Company pays such unpaid Redemption Price in full, the Holder shall have the option, in lieu of
redemption, to require the Company to promptly return to the Holder all or any portion of this Note representing the Conversion Amount
that was submitted for redemption and for which the applicable Redemption Price (together with any Late Charges thereon) has not been
paid. Upon the Company’s receipt of such notice, (x) the applicable Redemption Notice shall be null and void with respect to such
Conversion Amount, (y) the Company shall immediately return this Note, or issue a new Note (in accordance with Section 5(d)), to the
Holder. The Holder’s delivery of a notice voiding a Redemption Notice and exercise of its rights following such notice shall not
affect the Company’s obligations to make any payments of Late Charges which have accrued prior to the date of such notice with
respect to the Conversion Amount subject to such notice.


 




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(c)
Redemption by Other Holders. Upon the Company’s receipt of notice from any of the holders of the Other Notes for redemption
or repayment as a result of an event or occurrence substantially similar to the events or occurrences described in Section 4(b), Section
4(c), Section 5(b) or Section 5(c) or pursuant to equivalent provisions set forth in the Other Notes (each, an “Other Redemption
Notice”), the Company shall immediately, but no later than one (1) Business Day of its receipt thereof, forward to the Holder
by facsimile or electronic mail a copy of such notice. If the Company receives a Redemption Notice and one or more Other Redemption Notices,
during the seven (7) Business Day period beginning on and including the date which is three (3) Business Days prior to the Company’s
receipt of the Holder’s Redemption Notice and ending on and including the date which is three (3) Business Days after the Company’s
receipt of the Holder’s Redemption Notice and the Company is unable to redeem all principal, interest and other amounts designated
in such Redemption Notice and such Other Redemption Notices received during such seven (7) Business Day period, then the Company shall
redeem a pro rata amount from the Holder and each holder of the Other Notes (including the Holder) based on the Principal amount of this
Note and the Other Notes submitted for redemption pursuant to such Redemption Notice and such Other Redemption Notices received by the
Company during such seven Business Day period.


 


10.
VOTING RIGHTS. The Holder shall have no voting rights as the holder of this Note, except as required by law (including, without limitation,
the Nevada Revised Statutes) and as expressly provided in this Note.


 


11.
COVENANTS. For so long as this Note is outstanding:


 


(a)
Rank. All payments due under this Note (a) shall rank pari passu with all Other Notes and (b) shall be senior to all other
Indebtedness of the Company and its Subsidiaries, other than Permitted Indebtedness.


 


(b)
Incurrence of Indebtedness. The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly or indirectly,
incur or guarantee, assume or suffer to exist any Indebtedness, other than Permitted Indebtedness.


 


(c)
Existence of Liens. The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly or indirectly,
allow or suffer to exist any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by the Company or any of its Subsidiaries (collectively, “Liens”) other
than Permitted Liens.


 


(d)
Restricted Payments.


 


(i)
The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly or indirectly, redeem, defease, repurchase,
repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part, whether by way of open market
purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness (other than this Note and the Other
Notes and Permitted Indebtedness), whether by way of payment in respect of principal of (or premium, if any) or interest on, such Indebtedness
if at the time such payment is due or is otherwise made or, after giving effect to such payment, an event constituting, or that with
the passage of time and without being cured would constitute, an Event of Default has occurred and is continuing.


 




    	-19-



     


    

 


(ii)
The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly or indirectly, redeem, defease, repurchase,
repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part, whether by way of open market
purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness (including, without limitation,
Permitted Indebtedness other than this Note and the Other Notes), by way of payment in respect of principal of (or premium, if any) such
Indebtedness. For clarity, such restriction shall not preclude the payment of regularly scheduled principal and interest payments which
may accrue under such Permitted Indebtedness.


 


(e)
Restriction on Redemption and Cash Dividends. The Company shall not, and the Company shall not permit any of its Subsidiaries
to, directly or indirectly, redeem or repurchase its Equity Interest, or permit any Subsidiary to redeem or repurchase its Equity Interests
(except on a pro rata basis among all holders thereof) or declare or pay any cash dividend or distribution on any Equity Interest of
the Company or of its Subsidiaries without in each case the prior express written consent of the Holder; provided, however, that notwithstanding
the foregoing, without the prior written consent of the Holder any wholly-owned Subsidiary may pay dividends or otherwise make distributions
to another wholly-owned Subsidiary or the Company.


 


(f)
Change in Nature of Business. The Company shall not make, or permit any of its Subsidiaries to make, any material change in the
nature of its business as described in the Company’s most recent Quarterly Report filed on Form 10-Q with the SEC.


 


(g)
Intellectual Property. The Company shall not, and the Company shall not permit any of its Subsidiaries, directly or indirectly,
to encumber or allow any Liens on, any of its copyright rights, copyright applications, copyright registrations and like protections
in each work of authorship and derivative work, whether published or unpublished, any patents, patent applications and like protections,
including improvements, divisions, continuations, renewals, reissues, extensions, and continuations-in-part of the same, trademarks,
service marks and, to the extent permitted under applicable law, any applications therefor, whether registered or not, and the goodwill
of the business of the Company and its Subsidiaries connected with and symbolized thereby, know-how, operating manuals, trade secret
rights, rights to unpatented inventions, and any claims for damage by way of any past, present, or future infringement of any of the
foregoing, other than Permitted Liens.


 


(h)
Preservation of Existence, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve,
its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to become or remain, duly qualified and
in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its
business makes such qualification necessary, except to the extent that the failure to be so qualified or in good standing would not reasonably
be expected to have a Material Adverse Effect; provided, however, that any wholly-owned Subsidiary may merge with or into another wholly-owned
Subsidiary or the Company.


 








    	-20-



     


    

 


(i)
Maintenance of Properties, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve,
all of its material properties which are necessary in the proper conduct of its business in good working order and condition, ordinary
wear and tear excepted, and comply, and cause each of its Subsidiaries to comply, at all times in all material respects with the provisions
of all material leases to which it is a party as lessee or under which it occupies property, so as to prevent any loss or forfeiture
thereof or thereunder.


 


(j)
Maintenance of Insurance. The Company shall maintain, and cause each of its Subsidiaries to maintain, insurance with responsible
and reputable insurance companies or associations (including, without limitation, comprehensive general liability, hazard, rent and business
interruption insurance) with respect to its properties (including all real properties leased or owned by it) and business, in such amounts
and covering such risks as is required by any governmental authority having jurisdiction with respect thereto or as management determines
is appropriate in light of the risks faced by the business.


 


(k)
Transactions with Affiliates. The Company shall not, nor shall it permit any of its Subsidiaries to, enter into, renew, extend
or be a party to, any transaction or series of related transactions (including, without limitation, the purchase, sale, lease, transfer
or exchange of property or assets of any kind or the rendering of services of any kind) with any Affiliate, except as listed on Schedule
11(k) or in the ordinary course of business in a manner and to an extent consistent with past practice and necessary or desirable
for the prudent operation of its business, for fair consideration and on terms no less favorable to it or its Subsidiaries than would
be obtainable in a comparable arm’s length transaction with a Person that is not an Affiliate thereof.


 


(l)
Restricted Issuances. The Company shall not, directly or indirectly, without the prior written consent of the Holder, (i) issue
any Other Notes or Warrants (other than as contemplated by this Note and the Warrants) or (ii) issue any other securities that would
cause a breach or default under this Note, the Other Note, the Warrants or the Additional Warrants.


 


(m)
Independent Investigation. At the request of the Holder either (x) at any time when an Event of Default has occurred and is continuing,
(y) upon the occurrence of an event that with the passage of time or giving of notice would constitute an Event of Default or (z) at
any time the Holder reasonably believes an Event of Default may have occurred or be continuing, the Company shall hire an independent,
reputable investment bank selected by the Company and approved by the Holder to investigate as to whether any breach of this Note has
occurred (the “Independent Investigator”). If the Independent Investigator determines that such breach of this Note
has occurred, the Independent Investigator shall notify the Company of such breach and the Company shall deliver written notice to each
holder of a Note of such breach. In connection with such investigation, the Independent Investigator may, during normal business hours,
inspect all contracts, books, records, personnel, offices and other facilities and properties of the Company and its Subsidiaries and,
to the extent available to the Company after the Company uses reasonable efforts to obtain them, the records of its legal advisors and
accountants (including the accountants’ work papers) and any books of account, records, reports and other papers not contractually
required of the Company to be confidential or secret, or subject to attorney-client or other evidentiary privilege, and the Independent
Investigator may make such copies and inspections thereof as the Independent Investigator may reasonably request. The Company shall furnish
the Independent Investigator with such financial and operating data and other information with respect to the business and properties
of the Company as the Independent Investigator may reasonably request. The Company shall permit the Independent Investigator to discuss
the affairs, finances and accounts of the Company with, and to make proposals and furnish advice with respect thereto to, the Company’s
officers, directors, key employees and independent public accountants or any of them (and by this provision the Company authorizes said
accountants to discuss with such Independent Investigator the finances and affairs of the Company and any Subsidiaries), all at such
reasonable times, upon reasonable notice, and as often as may be reasonably requested.


 








    	-21-



     


    

 


12.
DISTRIBUTION OF ASSETS. In addition to any adjustments pursuant to Section 7, if the Company shall declare or make any dividend or
other distributions of its assets (or rights to acquire its assets) to any or all holders of shares of Common Stock, by way of return
of capital or otherwise (including without limitation, any distribution of cash, stock or other securities, property or options by way
of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (the “Distributions”),
then the Holder will be entitled to such Distributions as if the Holder had held the number of shares of Common Stock acquirable upon
complete conversion of this Note (without taking into account any limitations or restrictions on the convertibility of this Note and
assuming for such purpose that the Note was converted at the Conversion Price as of the applicable record date) immediately prior to
the date on which a record is taken for such Distribution or, if no such record is taken, the date as of which the record holders of
Common Stock are to be determined for such Distributions (provided, however, that to the extent that the Holder’s right to participate
in any such Distribution would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder
shall not be entitled to participate in such Distribution to the extent of the Maximum Percentage (and shall not be entitled to beneficial
ownership of such shares of Common Stock as a result of such Distribution (and beneficial ownership) to the extent of any such excess)
and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time or times, if ever, as its
right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times
the Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution or on any subsequent
Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).


 


13.
VOTE TO ISSUE, OR CHANGE THE TERMS OF, NOTES. The affirmative vote at a meeting duly called for such purpose or the written consent
without a meeting of the Holder shall be required for any change or amendment or waiver of any provision to this Note or any of the Other
Notes. Any change, amendment or waiver by the Company and the Holder shall be binding on the Holder of this Note and all holders of the
Other Notes. No consideration shall be offered or paid to the Holder to amend or consent to a waiver or modification of any provision
of this Note unless the same consideration is also offered to all of the holders of the Other Notes. The Holder shall be entitled, at
its option, to the benefit of any amendment to any of the Other Notes or adjustment to the Conversion Price pursuant to Section 7(b)
of the Other Notes.


 


14.
TRANSFER. This Note and any shares of Common Stock issued upon conversion of this Note may be offered, sold, assigned or transferred
by the Holder without the consent of the Company, subject only to the provisions of this Section 14. The Holder understands that except
as provided in this Section 14: (i) the Securities have not been and are not being registered under the 1933 Act or any state securities
laws, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder, (B) the Holder shall
have delivered to the Company (if requested by the Company) an opinion of counsel to the Holder, in a form reasonably acceptable to the
Company, to the effect that such Securities to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption
from such registration, or (C) the Holder provides the Company with reasonable assurance that such Securities can be sold, assigned or
transferred pursuant to Rule 144 or Rule 144A promulgated under the 1933 Act (or a successor rule thereto) (collectively, “Rule
144”); (ii) any sale of the Securities made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144,
and further, if Rule 144 is not applicable, any resale of the Securities under circumstances in which the seller (or the Person through
whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some
other exemption under the 1933 Act or the rules and regulations of the SEC promulgated thereunder; and (iii) neither the Company nor
any other Person is under any obligation to register the Securities under the 1933 Act or any state securities laws or to comply with
the terms and conditions of any exemption thereunder. Notwithstanding anything to the contrary contained in this Note, the Company acknowledges
and agrees that the Securities may be pledged by the Holder in connection with a bona fide margin agreement or other loan or financing
arrangement that is secured by the Securities. The pledge of Securities shall not be deemed to be a transfer, sale or assignment of the
Securities hereunder, and the Holder effecting a pledge of Securities shall not be required to provide the Company with any notice thereof
or otherwise make any delivery to the Company pursuant to this Note. The Company hereby agrees to execute and deliver such documentation
as a pledgee of the Securities may reasonably request in connection with a pledge of the Securities to such pledgee by the Holder.


 


15.
REISSUANCE OF THIS NOTE.


 


(a)
Transfer. If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith
issue and deliver upon the order of the Holder a new Note (in accordance with Section 1515(d)), registered as the Holder may request,
representing the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal is being transferred,
a new Note (in accordance with Section 15(d)) to the Holder representing the outstanding Principal not being transferred. The Holder
and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of Section 3(c)(iii) following
conversion or redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal
stated on the face of this Note.


 




    	-22-



     


    

 


(b)
Lost, Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Note (as to which a written certification and the indemnification contemplated below shall suffice
as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company in
customary and reasonable form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company shall execute
and deliver to the Holder a new Note (in accordance with Section 15(d)) representing the outstanding Principal.


 


(c)
Note Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the principal
office of the Company, for a new Note or Notes (in accordance with Section 15(d) and in principal amounts of at least $1,000) representing
in the aggregate the outstanding Principal of this Note, and each such new Note will represent such portion of such outstanding Principal
as is designated by the Holder at the time of such surrender.


 


(d)
Issuance of New Note. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note (i)
shall be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding
(or in the case of a new Note being issued pursuant to Section 15(a) or Section 15(c), the Principal designated by the Holder which,
when added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal
remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated
on the face of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have the same rights and conditions as
this Note, and (v) shall represent accrued and unpaid Interest and Late Charges on the Principal and Interest of this Note, from the
Issuance Date.


 


16.
REMEDIES, CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in this Note shall be cumulative
and in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity (including
a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s right to pursue actual
and consequential damages for any failure by the Company to comply with the terms of this Note. No failure on the part of the Holder
to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single
or partial exercise by the Holder of any right, power or remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. In addition, the exercise of any right or remedy of the Holder at law or equity or under this Note or any
of the documents shall not be deemed to be an election of Holder’s rights or remedies under such documents or at law or equity.
The Company covenants to the Holder that there shall be no characterization concerning this instrument other than as expressly provided
herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall
be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of
the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable
harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event
of any such breach or threatened breach, the Holder shall be entitled, in addition to all other available remedies, to specific performance
and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction in any such
case without the necessity of proving actual damages and without posting a bond or other security. The Company shall provide all information
and documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with the
terms and conditions of this Note (including, without limitation, compliance with Section 7).


 




    	-23-



     


    

 


17.
PAYMENT OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in the hands of an attorney for collection or enforcement
or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this Note
or to enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings
affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay the costs incurred by the
Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership or other proceeding,
including, without limitation, attorneys’ fees and disbursements. The Company expressly acknowledges and agrees that no amounts
due under this Note shall be affected, or limited, by the fact that the purchase price paid for this Note was less than the original
Principal amount hereof.


 


18.
CONSTRUCTION; HEADINGS. This Note shall be deemed to be jointly drafted by the Company and the initial Holder and shall not be construed
against any such Person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part of,
or affect the interpretation of, this Note. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed to include
the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,” “include”
and words of like import shall be construed broadly as if followed by the words “without limitation.” The terms “herein,”
“hereunder,” “hereof” and words of like import refer to this entire Note instead of just the provision in which
they are found. Unless expressly indicated otherwise, all section references are to sections of this Note. Terms used in this Note and
not otherwise defined herein, but defined in the other Transaction Documents, shall have the meanings ascribed to such terms on the Closing
Date in such other Transaction Documents unless otherwise consented to in writing by the Holder.


 


19.
FAILURE OR INDULGENCE NOT WAIVER. No failure or delay on the part of the Holder in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and
signed by an authorized representative of the waiving party. Notwithstanding the foregoing, nothing contained in this Section 19 shall
permit any waiver of any provision of Section 3(c)(vi).


 




    	-24-



     


    

 


20.
NOTICES; CURRENCY; PAYMENTS.


 


(a)
Notices. Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given
in accordance with Section 6.3 of the Exchange Agreement. The Company shall provide the Holder with prompt written notice of all actions
taken pursuant to this Note, including in reasonable detail a description of such action and the reason therefore. Without limiting the
generality of the foregoing, the Company will give written notice to the Holder (i) immediately upon any adjustment of the Conversion
Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen (15) days prior
to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Common
Stock, (B) with respect to any grant, issuances, or sales of any Options, Convertible Securities or rights to purchase stock, warrants,
securities or other property to holders of shares of Common Stock or (C) for determining rights to vote with respect to any Fundamental
Transaction, dissolution or liquidation, provided in each case that such information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder.


 


(b)
Currency. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, unless otherwise expressly
set forth herein, such payment shall be made in lawful money of the United States of America by a certified or bank check drawn on the
account of the Company and sent via overnight courier service to such Person at such address as previously provided to the Company in
writing (which address, in the case of the Holder named in the Exchange Agreement, shall initially be as set forth in the Exchange Agreement),
provided that the Holder may elect to receive a payment of cash via wire transfer of immediately available funds by providing the Company
with prior written notice setting out such request and the Holder’s wire transfer instructions.


 


(c)
Payments. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a Business Day, the
same shall instead be due on the next succeeding day which is a Business Day. Any amount of Principal or other amounts due under the
Transaction Documents which is not paid when due (except to the extent such amount is simultaneously accruing Interest at the Default
Rate hereunder) shall result in a late charge being incurred and payable by the Company in an amount equal to interest on such amount
at the rate of eighteen percent (18%) per annum from the date such amount was due until the same is paid in full (“Late Charge”).


 


21.
CANCELLATION. After all Principal, accrued Interest, Late Charges and other amounts at any time owed on this Note have been paid
in full, this Note shall automatically be deemed canceled, shall be surrendered to the Company for cancellation and shall not be reissued.


 


22.
WAIVER OF NOTICE. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment, protest and
all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note and the Exchange
Agreement.


 




    	-25-



     


    

 


23.
GOVERNING LAW. This Note shall be construed and enforced in accordance with, and all questions concerning the construction, validity,
interpretation and performance of this Note shall be governed by, the internal laws of the State of New York, without giving effect to
any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause
the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and
agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court,
that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.
Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall
be deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction
to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations,
or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE
TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS
NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY.


 


24.
SEVERABILITY. If any provision of this Note is prohibited by law or otherwise determined to be invalid or unenforceable by a court
of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply
to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Note so long as this Note as so modified continues to express, without material change,
the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the
provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or the practical
realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations
to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible
to that of the prohibited, invalid or unenforceable provision(s).


 


25.
MAXIMUM PAYMENTS. Without limiting Section 6.5 of the Exchange Agreement, nothing contained herein shall be deemed to establish or
require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event that the
rate of interest required to be paid or other charges hereunder exceed the maximum permitted by such law, any payments in excess of such
maximum shall be credited against amounts owed by the Company to the Holder and thus refunded to the Company.


 




    	-26-



     


    

 


26.
CERTAIN DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:


 


(a)
“Additional Warrants” shall mean all warrants issued in exchange for any Warrants issued pursuant to the Exchange
Agreement or replacement thereof.


 


(b)
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled
by, or is under common control with, such Person, it being understood for purposes of this definition that “control” of a
Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of
directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.


 


(c)
“Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including,
any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed
or advised by the Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of
the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or
any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common Stock would or could be aggregated
with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the Exchange Act. For clarity, the purpose
of the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.


 


(d)
“Bloomberg” means Bloomberg, L.P.


 


(e)
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New
York are authorized or required by law to remain closed.


 


(f)
“Change of Control” means any Fundamental Transaction other than (i) any merger of the Company or any of its, direct
or indirect, wholly-owned Subsidiaries with or into any of the foregoing Persons, (ii) any reorganization, recapitalization or reclassification
of the shares of Common Stock in which holders of the Company’s voting power immediately prior to such reorganization, recapitalization
or reclassification continue after such reorganization, recapitalization or reclassification to hold publicly traded securities and,
directly or indirectly, are, in all material respects, the holders of the voting power of the surviving entity (or entities with the
authority or voting power to elect the members of the board of directors (or their equivalent if other than a corporation) of such entity
or entities) after such reorganization, recapitalization or reclassification, or (iii) pursuant to a migratory merger effected solely
for the purpose of changing the jurisdiction of incorporation of the Company or any of its Subsidiaries.


 


(g)
“Change of Control Redemption Premium” means 125%.


 




    	-27-



     


    

 


(h)
“Closing Sale Price” means, for any security as of any date, the last closing trade price for such security on the
Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours basis and does not designate
the closing trade price then the last trade price of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or,
if the Principal Market is not the principal securities exchange or trading market for such security, the last trade price of such security
on the principal securities exchange or trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing
do not apply, the last trade price of such security in the over-the-counter market on the electronic bulletin board for such security
as reported by Bloomberg, or, if no last trade price is reported for such security by Bloomberg, the average of the bid prices, or the
ask prices, respectively, of any market makers for such security as reported in the “pink sheets” by OTC Markets Group Inc.
(formerly Pink Sheets LLC). If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing
bases, the Closing Sale Price of such security on such date shall be the fair market value as mutually determined by the Company and
the Holder. All such determinations shall be appropriately adjusted for any stock splits, stock dividends, stock combinations, recapitalizations
or other similar transactions during such period.


 


(i)
“Closing Date” shall have the meaning set forth in the Exchange Agreement, which date is the date the Company initially
issued Notes pursuant to the terms of the Exchange Agreement.


 


(j)
“Common Stock” means (i) the Company’s shares of common stock, par value $0.0001 per share, and (ii) any capital
stock into which such common stock shall have been changed or any share capital resulting from a reclassification of such common stock.


 


(k)
“Conversion Shares” means shares of Common Stock issuable by the Company pursuant to the terms of any of the Notes,
including any related Interest and Late Charges so converted, amortized or redeemed.


 


(l)
“Convertible Securities” means any stock or other security (other than Options) that is at any time and under any
circumstances, directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof
to acquire, any shares of Common Stock.


 


(m)
“Equity Interests” means (a) all shares of capital stock (whether denominated as common capital stock or preferred
capital stock), equity interests, beneficial, partnership or membership interests, joint venture interests, participations or other ownership
or profit interests in or equivalents (regardless of how designated) of or in a Person (other than an individual), whether voting or
non-voting and (b) all securities convertible into or exchangeable for any of the foregoing and all warrants, options or other rights
to purchase, subscribe for or otherwise acquire any of the foregoing, whether or not presently convertible, exchangeable or exercisable.


 


(n)
“Eligible Market” means a National Exchange or the Principal Market.


 


(o)
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.


 




    	-28-



     


    

 


 A.




(p)
“Exchange Date” means March 3, 2022.


 


(q)
“Event of Default Redemption Premium” means 125%.


 


(r)
“Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through subsidiaries,
Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the
surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all
of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation
S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject
to or have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that
is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares of
Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with any Subject
Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock
such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or
exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of at least 50% of the outstanding
shares of Common Stock, or (iv) consummate a stock or share purchase agreement or other business combination (including, without limitation,
a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities,
individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of Common Stock, (y) at least 50% of the
outstanding shares of Common Stock calculated as if any shares of Common Stock held by all the Subject Entities making or party to, or
Affiliated with any Subject Entity making or party to, such stock purchase agreement or other business combination were not outstanding;
or (z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined in
Rule 13d-3 under the Exchange Act) of at least 50% of the outstanding shares of Common Stock, or (v) reorganize, recapitalize or reclassify
its Common Stock, (B) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one
or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate to be or become the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, whether through acquisition, purchase, assignment,
conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination,
reorganization, recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise
in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common
Stock, (y) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by all such
Subject Entities as of the date of this Note calculated as if any shares of Common Stock held by all such Subject Entities were not outstanding,
or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding shares of Common Stock or other equity
securities of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction requiring
other shareholders of the Company to surrender their shares of Common Stock without approval of the shareholders of the Company or (C)
directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of
or the entering into any other instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this
definition in which case this definition shall be construed and implemented in a manner otherwise than in strict conformity with the
terms of this definition to the extent necessary to correct this definition or any portion of this definition which may be defective
or inconsistent with the intended treatment of such instrument or transaction. Provided, however, clauses (x) and (y) of
subsection (B) shall not apply to the Company’s Chief Executive Officer and her affiliates.


 




    	-29-



     


    

 


(s)
“GAAP” means United States generally accepted accounting principles, consistently applied.


 


(t)
“Group” means a “group” as that term is used in Section 13(d) of the Exchange Act and as defined in Rule
13d-5 thereunder.


 


(u)
“Indebtedness” shall have the meaning ascribed to such term in the Purchase Agreement.


 


(v)
“Maturity Date” shall mean March 3, 2023,; provided, however, the Maturity Date may be extended at the option
of the Holder (i) in the event that, and for so long as, an Event of Default shall have occurred and be continuing or any event shall
have occurred and be continuing that with the passage of time and the failure to cure would result in an Event of Default or (ii) through
the date that is twenty (20) Business Days after the consummation of a Fundamental Transaction in the event that a Fundamental Transaction
is publicly announced or Qualified Offering Notice is delivered prior to the Maturity Date, provided further that if a Holder elects
to convert some or all of this Note pursuant to Section 3 hereof, and the Conversion Amount would be limited pursuant to Section 3(c)(vi)
hereunder, the Maturity Date shall automatically be extended until such time as such provision shall not limit the conversion of this
Note.


 


(w)
“National Exchange” means the New York Stock Exchange, the NYSE American, The Nasdaq Global Select Market, The Nasdaq
Global Market or The Nasdaq Capital Market (or any nationally recognized successor to any of the foregoing).


 


(x)
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities.


 


(y)
“Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose
common stock or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent
Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.


 




    	-30-



     


    

 


(z)
“Permitted Indebtedness” means (i) Indebtedness evidenced by this Note and the Other Notes, (ii) Indebtedness set
forth on Schedule 4(d) to the Purchase Agreement, as in effect as of the Exchange Date and (iii) Indebtedness secured by Permitted
Liens or unsecured but as described in clauses (iv) and (v) of the definition of Permitted Liens.


 


(aa)
“Permitted Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate
proceedings for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising in the ordinary
course of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation
of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business
with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings, (iv)
Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries to secure the purchase price of such equipment
or Indebtedness incurred solely for the purpose of financing the acquisition or lease of such equipment, or (B) existing on such equipment
at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and improvements thereon, and the
proceeds of such equipment, in either case, with respect to Indebtedness in an aggregate amount not to exceed $100,000, (v) Liens incurred
in connection with the extension, renewal or refinancing of the Indebtedness secured by Liens of the type described in clause (iv) above,
provided that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal
amount of the Indebtedness being extended, renewed or refinanced does not increase, (vi) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payments of custom duties in connection with the importation of goods, and (vii) Liens arising from
judgments, decrees or attachments in circumstances not constituting an Event of Default under Section 4(a)(vii).


 


(bb)
“Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust,
an unincorporated organization, any other entity or a government or any department or agency thereof.


 


(cc)
“Principal Market” means the OTCQB operated by OTC Markets Group, Inc. (or any recognized successor thereto).


 


(dd)
“Public Offering Price Per Share” means, with respect to any Qualified Offering, the gross public offering price per
share of Common Stock paid by public investors in such Qualified Offering, (i) prior to deducting any underwriting discounts or commissions,
any placement agent or other fees or commissions, and any other offering fees or expenses payable by the Company in connection with such
Qualified Offering and (ii) excluding (A) any amounts paid or payable by public investors in the Qualified Offering for any Options or
Convertible Securities sold to the public investors in such Qualified Offering, whether such Options or Convertible Securities are sold
as a unit or otherwise together with the Common Stock sold in such Qualified Offering, in any combination, or otherwise, and (B) any
amounts paid or payable for any shares of Common Stock that may be acquired pursuant to the exercise or conversion of any Options or
Convertible Securities sold to the public investors together with the Common Stock in such Qualified Offering (not taking into account
any cashless exercise provisions).


 




    	-31-



     


    

 


(ee)
“Qualified Offering” means a public offering by the Company of Common Stock, either alone or together with any Options
or Convertible Securities, in any combination thereof, as a unit or otherwise, pursuant to an effective registration statement (other
than on Forms S-4 or S-8 or successors to such forms) filed after the Issuance Date by the Company with the SEC under the Securities
Act, resulting in Qualified Offering Proceeds equal to or greater than $10,000,000, and in connection with which the Common Stock shall
be approved for listing and, upon consummation of such public offering, listed for trading on a National Exchange.


 


(ff)
“Qualified Offering Redemption Premium” means 115%.


 


(gg)
“Qualified Offering Proceeds” means, with respect to any Qualified Offering, an amount equal to the total aggregate
gross cash proceeds to the Company from such Qualified Offering, (i) prior to deducting any underwriting discounts or commissions, any
placement agent or other fees or commissions, and any other offering fees or expenses payable by the Company in connection with such
Qualified Offering, including, without limitation, any direct out-of-pocket actual and estimated professional fees, disbursements and
other costs or expenses incurred by the Company in connection with such Qualified Offering and (ii) excluding any amounts paid or payable
for any shares of Common Stock that may be acquired pursuant to the exercise or conversion of any Options or Convertible Securities sold
to the public investors in such Qualified Offering.


 


(hh)
“Redemption Notices” means, collectively, the Event of Default Redemption Notices, the Change of Control Redemption
Notices, and the Qualified Offering Redemption Notices, each of the foregoing, individually, a Redemption Notice.


 


(ii)
“Resale Eligibility Date” means earlier of (i) the date a registration statement, registering the resale of the Conversion
Shares that are issuable upon conversion of this Note by the Holder is declared effective by the SEC under the Securities Act, and (ii)
the initial date any of the Conversion Shares are eligible to be resold pursuant to Rule 144.


 


(jj)
“SEC” means the United States Securities and Exchange Commission or the successor thereto.


 


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


 


(ll)
“Exchange Date” means March 3, 2022.


 




    	-32-



     


    

 


(mm)
“Subsidiaries” means, as of any date of determination, collectively, any Person in which the Company, directly or
indirectly, (i) owns any of the outstanding capital stock or holds any equity or similar interest of such Person or (ii) controls or
operates all or any part of the business, operations or administration of such Person.


 


(nn)
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.


 


(oo)
“Successor Entity” means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting from
or surviving any Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental
Transaction shall have been entered into.


 


(pp)
“Trading Day” means, as applicable, (x) with respect to all price or trading volume determinations relating to the
Common Stock, any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the principal trading
market for the Common Stock, then on the principal securities exchange or securities market on which the Common Stock is then traded,
provided that “Trading Day” shall not include any day on which the Common Stock is scheduled to trade on such exchange or
market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the final hour of trading on such exchange
or market (or if such exchange or market does not designate in advance the closing time of trading on such exchange or market, then during
the hour ending at 4:02:00 p.m., New York time) unless such day is otherwise designated as a Trading Day in writing by the Holder or
(y) with respect to all determinations other than price determinations relating to the Common Stock, any day on which The New York Stock
Exchange (or any successor thereto) is open for trading of securities.


 


(qq)
“VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal
Market (or, if the Principal Market is not the principal trading market for such security, then on another Eligible Market on which such
security is then traded) during the period beginning at 9:30:01 a.m., New York time, and ending at 4:02:00 p.m., New York time, as reported
by Bloomberg through its “AQR” function (set to weighted average) or, if the foregoing does not apply, the dollar volume-weighted
average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning
at 9:30:01 a.m., New York time, and ending at 4:02:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted
average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest
closing ask price of any of the market makers for such security as reported in the “pink sheets” by OTC Markets Group Inc.
(formerly Pink Sheets LLC). If the VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP of
such security on such date shall be the fair market value as mutually determined by the Company and the Holder. All such determinations
shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other similar transaction
during such period.


 


(rr)
“Warrants” has the meaning ascribed to such term in the Exchange Agreement, and shall include all warrants issued
in exchange therefor or replacement thereof.


 


27.
DISCLOSURE. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless the Company has
in good faith determined that the matters relating to such notice do not constitute material, non-public information relating to the
Company or any of its Subsidiaries, the Company shall within one (1) Business Day of such receipt or prior to (or simultaneous with)
such delivery, as applicable, publicly disclose such material, non-public information on a Current Report on Form 8-K or otherwise. In
the event that the Company believes that a notice contains material, non-public information relating to the Company or any of its Subsidiaries,
the Company so shall indicate to the Holder contemporaneously with delivery of such notice, and in the absence of any such indication,
the Holder shall be allowed to presume that all matters relating to such notice do not constitute material, non-public information relating
to the Company or any of its Subsidiaries. If the Company or any of its Subsidiaries provides material non-public information to the
Holder that is not simultaneously filed in a Current Report on Form 8-K and the Holder has not agreed to receive such material non-public
information, the Company hereby covenants and agrees that the Holder shall not have any duty of confidentiality to the Company, any of
its Subsidiaries or any of their respective officers, directors, employees, affiliates or agents with respect to, or a duty to any of
the foregoing not to trade on the basis of, such material non-public information.


 


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


 


(Signature
Page Follows)


 




    	-33-



     


    

 


IN
WITNESS WHEREOF, the Company has caused this Note to be duly executed as of the Issuance Date set out above.


 


	 	PANACEA
    LIFE SCIENCES HOLDINGS, INC.
	 	 	 
	 	By:	/s/
Leslie Buttorff
	 	Name:	Leslie
    Buttorff
	 	Title:	Chief
    Executive Officer


 




    	-34-



     


    

 


EXHIBIT
I


 


PANACEA
LIFE SCIENCES HOLDINGS, INC.


CONVERSION
NOTICE


 


Reference
is made to the Senior Convertible Note (the “Note”) issued to the undersigned by Panacea Life Sciences Holdings, Inc,
a Nevada corporation (the “Company”). In accordance with and pursuant to the Note, the undersigned hereby elects to
convert the Conversion Amount (as defined in the Note) of the Note indicated below into shares of Common Stock, $0.0001 par value per
share (the “Common Stock”), of the Company, as of the date specified below. Capitalized terms not defined herein shall
have the meaning as set forth in the Note.






 


	Date
    of Conversion:

    
	 	 
	 	 	 
	Aggregate
    Principal to be converted:

    
	 	 
	 	 	 
	Aggregate
    accrued and unpaid Interest and accrued and unpaid Late Charges with respect to such portion of the Aggregate Principal and such
    Aggregate Interest to be converted:

    
	 	 
	 	 	 
	AGGREGATE
    CONVERSION AMOUNT TO BE CONVERTED:

    
	 	 
	 	 	 
	Please
    confirm the following information:

    
	 	 

	 	 	 
	Conversion
    Price:

    
	 	 
	 	 	 
	Number
    of shares of Common Stock to be issued:

    
	 	 


 


	Please
    issue the Common Stock into which the Note is being converted to Holder, or for its benefit, as follows:


 


	 	☐	Check
    here if requesting delivery as a certificate to the following name and to the following address:


 


	 	Issue
    to:	 
	 	 	 
	 	 	 


 


	 	☐	Check
    here if requesting delivery by Deposit/Withdrawal at Custodian as follows:


 


	 	DTC
    Participant:

    
	 
	 	 	 
	 	DTC
    Number:

    
	 
	 	 	 
	 	Account
    Number:

    
	 


 





	Date:
    _____________ __,

    
	 



 


	Name of Registered Holder	 
	 	 	 
	By:	       	
	Name:

	 	 
	Title:

	 	 


 


	Tax ID:	        	
	Facsimile:

		 
	E-mail Address:	 	


 




    	 



    	 



    

 


Exhibit
II


 


ACKNOWLEDGMENT


 


The
Company hereby (a) acknowledges this Conversion Notice, (b) certifies that the above indicated number of shares of Common Stock [are][are
not] eligible to be resold by the Holder either (i) pursuant to Rule 144 (subject to the Holder’s execution and delivery to the
Company of a customary 144 representation letter) or (ii) an effective and available registration statement and (c) hereby directs _________________
to issue the above indicated number of shares of Common Stock in accordance with the Transfer Agent Instructions dated _____________,
20__ from the Company and acknowledged and agreed to by ________________________.


 


	 	[NAME]
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title: