Exhibit 10.1 


 


SECURITIES
PURCHASE AGREEMENT


 


This
Securities Purchase Agreement (this “Agreement”) is dated as of April 1, 2020, between Chanticleer Holdings,
Inc., a Delaware corporation (“Chanticleer”), Amergent Hospitality Group, Inc., a Delaware corporation (“Spin-Off”
or the “Company”), Oz Rey, LLC, a Texas limited liability company (“Oz Rey”) and each purchaser
identified on the signature pages hereto (with Oz Rey and each purchaser identified on the signature pages hereto, a “Purchaser”
and collectively, the “Purchasers”).


 


WHEREAS,
on October 10, 2019, Chanticleer, Sonnet BioTherapeutics, Inc., a New Jersey corporation (“Sonnet”), and Biosub
Inc., a Delaware corporation (“Merger Sub”) entered into an Agreement and Plan of Merger (the “Merger
Agreement”) pursuant to which Merger Sub will be merged with and into Sonnet (the “Merger”), with
Sonnet surviving the Merger as a wholly-owned subsidiary of Chanticleer.


 


WHEREAS,
as part of this transaction, Chanticleer will spin-off its current restaurant operations, including all assets and liabilities
(the “Spin Off”), into the Company, the equity of which will be distributed out to the stockholders of Chanticleer
prior to the effective time of the Merger.


 


WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to Section 4(a)(2) of the Securities Act of 1933,
as amended (the “Securities Act”), and Rule 506 promulgated thereunder, the Company desires to issue and sell
to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company
as more fully described in this Agreement.


 


NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as follows:


 


ARTICLE
I. DEFINITIONS


 


1.1
Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings set forth
in this Section 1.1:


 


“Acquiring
Person” shall have the meaning ascribed to such term in Section 4.7.


 


“Action”
shall have the meaning ascribed to such term in Section 3.1(j).


 


“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.


 


“Board
of Directors” means the board of directors of the Company.


 




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


 


“Closing”
means the closing of the purchase and sale of the Securities pursuant to Section 2.1.


 


“Closing
Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable
parties thereto, and all conditions precedent to the Purchasers’ obligations to acquire the Securities have been satisfied
or waived.


 


“Commission”
means the United States Securities and Exchange Commission.


 


“Common
Stock” means the common stock of the Company, par value $0.0001 per share, and any other class of securities into which
such securities may hereafter be reclassified or changed.


 


“Common
Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to
acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument
that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive,
Common Stock.


 


“Company
Counsel” means Libertas Law Group, Inc., with offices located at 225 Santa Monica Boulevard, 5th Floor, Santa
Monica, CA 90401.


 


“Conversion
Shares” means any shares of Common Stock issuable upon conversion of the New Debentures.


 


“Disclosure
Schedules” shall have the meaning ascribed to such term in Section 3.1.


 


“Evaluation
Date” shall have the meaning ascribed to such term in Section 3.1(s).


 


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


 


“FCPA”
means the Foreign Corrupt Practices Act of 1977, as amended.


 


“GAAP”
shall have the meaning ascribed to such term in Section 3.1(h).


 


“Indebtedness”
shall have the meaning ascribed to such term in Section 3.1(bb).


 




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“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3.1(o).


 


“Legend
Removal Date” shall have the meaning ascribed to such term in Section 4.1(c).


 


“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.


 


“Material
Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).


 


“Material
Permits” shall have the meaning ascribed to such term in Section 3.1(m).


 


“Maximum
Rate” shall have the meaning ascribed to such term in Section 5.17.


 


“New
Debentures” means the 10.0% Secured Convertible Debentures issued by the Company to Oz Rey, in the form of Exhibit
A attached hereto.


 


“Old
Debentures” means $6,000,000 in original principal amount of Chanticleer’s 8.0% Secured Debentures, originally
due December 31, 2018, as amended by that certain Amendment to 8% Secured Debentures between Chanticleer and each original holder
of the Old Debentures.


 


“Oz
Rey” means Oz Rey, LLC, a Texas limited liability company.


 


“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.


 


“Pledged
Securities” means any and all certificates and other instruments representing or evidencing all of the capital stock
and other equity interests of the Subsidiaries.


 


“Proceeding”
means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial
proceeding, such as a deposition), whether commenced or threatened.


 


“Purchaser
Party” shall have the meaning ascribed to such term in Section 4.9.


 


“Registration
Rights Agreement” means the Registration Rights Agreement, dated the date hereof, among the Company and the Purchasers,
in the form of Exhibit B attached hereto.


 


“Required
Approvals” shall have the meaning ascribed to such term in Section 3.1(e).


 




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“Required
Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock then issued or potentially issuable
in the future pursuant to the Transaction Documents, including any Warrant Shares issuable upon exercise in full of all Warrants
and any Conversion Shares issuable upon conversion in full of the New Debentures at the Fixed Conversion Price set forth therein,
ignoring any exercise limits set forth therein.


 


“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended from time
to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such Rule.


 


“SEC
Reports” shall have the meaning ascribed to such term in Section 3.1(h).


 


“Securities”
means the New Debentures, the Conversion Shares, the Warrants, and the Warrant Shares.


 


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


 


“Security
Agreement” means the Security Agreement, dated the date hereof, among the Company and Oz Rey, in the form of Exhibit
C attached hereto.


 


“Security
Documents” shall mean the Security Agreement, the Subsidiary Guarantees, the original Pledged Securities, along with
medallion guaranteed executed blank stock powers to the Pledged Securities, and any other documents and filing required thereunder
in order to grant Oz Rey a security interest in the assets of the Company and the Subsidiaries as provided in the Security Agreement,
including all UCC-1 filing receipts.


 


“Shares”
means the Warrant Shares and the Conversion Shares.


 


“Shearman”
means Shearman & Sterling LLP, with offices located at 1100 Louisiana Street, Suite 3300, Houston, Texas 77002.


 


“Subsidiary”
means any subsidiary of the Company as set forth on Schedule 3.1(a) and shall, where applicable, also include any direct
or indirect subsidiary of the Company formed or acquired after the date hereof.


 


“Subsidiary
Guarantee” means the Subsidiary Guarantee, dated the date hereof, by each Subsidiary in favor of Oz Rey, in the form
of Exhibit D attached hereto.


 


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


 




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“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the
New York Stock Exchange (or any successors to any of the foregoing).


 


“Transaction
Documents” means this Agreement, the Debentures, the Warrants, the Security Agreement, the Subsidiary Guarantee, the
Registration Rights Agreement, and all exhibits and schedules thereto and hereto and any other documents or agreements executed
in connection with the transactions contemplated hereunder.


 


“Transfer
Agent” means Securities Transfer Corporation, the transfer agent of the Company, with a mailing address of 901 N Dallas
Parkway, Suite 380 and a facsimile number of (469) 633-0088, and any successor transfer agent of the Company.


 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX
as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common
Stock are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d)
in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the Purchasers of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.


 


“Warrant
Exchange” means the Warrant Exchange whereby Purchasers exercised Warrants to purchase 2,000,000 shares of common stock
of Chanticleer at a reduced exercise price of $0.50 for gross proceeds to Chanticleer of $1,000,000.


 


“Warrants”
means, collectively, the Common Stock purchase warrants delivered to the Purchasers at the Closing in accordance with Section
2.2(a) hereof, which Warrants shall be exercisable from the date of issuance and have a term of exercise equal to ten (10) years,
in the form of Exhibit E attached hereto.


 


“Warrant
Shares” means the shares of Common Stock issuable upon exercise of the Warrants.


 




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ARTICLE
II.


PURCHASE
AND SALE


 


2.1  Closing.
On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution
and delivery of this Agreement by the parties hereto, (a) the Company hereby agrees to sell, and Oz Rey hereby agrees to buy,
the New Debentures in exchange for cancellation of the Old Indentures and the cash payments contemplated herein, and (b) the Company
agrees to issue, and the Purchasers, severally and not jointly, agree to acquire the Warrants in the denominations set forth on
Schedule 2.1. The Company and each Purchaser shall deliver the items set forth in Section 2.2 deliverable at the Closing.
Upon satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of
Shearman or such other location as the parties shall mutually agree. Notwithstanding the foregoing, the Company and Oz Rey may
consummate the Closing between them prior to the execution of this Agreement by any other Purchaser, upon which time the releases
by Oz Rey set forth in Section 4.14 shall become effective. Subsequent Closings may be held to issue Warrants to Purchasers
upon the Company’s receipt of a signed counterpart of this Agreement by such Purchasers.


 


2.2
Deliveries.




 


(a)  On
or prior to the Closing Date, the Company shall deliver or cause to be delivered to the appropriate Purchaser the following:


 


(i)
this Agreement duly executed by the Company;




 


(ii)  a
New Debenture with a principal amount equal to the principal and interest outstanding on the Old Debentures on the date of the
Closing, less $2,000,000, registered in the name of Oz Rey;


 


(iii)  a
Warrant registered in the name of such Purchaser to purchase up to a number of shares of Common Stock set forth on Schedule 2.1
hereto, with an exercise price set forth next to such Purchaser’s name on Schedule 2.1, subject to adjustment therein;


 


(iv)  the
Security Agreement, duly executed by the Company and each Subsidiary, along with all of the Security Documents, including the
Subsidiary Guarantee, duly executed by the parties thereto, the original Pledged Securities and corresponding stock powers;


 


(v)
the Registration Rights Agreement, duly executed by the Company; and




 


(vi)
wire transfer of immediately available funds in the amount of $2,000,000 (less $650,000 previously advanced) payable pursuant
to instructions received from Oz Rey, plus expenses for which Oz Rey is entitled to receive.


 






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(b)  On
or prior to the Closing Date, the appropriate Purchaser shall deliver or cause to be delivered to the Company the following:


 


(i)
this Agreement duly executed by such Purchaser;




 


(ii)
the Security Agreement duly executed by Oz Rey;




 


(iii)
the Registration Rights Agreement, duly executed by the Purchasers;and


 


(iv)
originals of the Old Debentures.




 


2.3
Closing Conditions.




 


(a)  The
obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:


 


(i)  the
accuracy in all material respects on (or, to the extent representations or warranties are qualified by materiality or Material
Adverse Effect, in all respects) the Closing Date of the representations and warranties of the Purchasers contained herein (unless
as of a specific date therein in which case they shall be accurate as of such date);


 


(ii)  all
obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been
performed; and


 


(iv)
the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.


 


(b)  The
respective obligations of the Purchasers hereunder in connection with the Closing are subject to the following conditions being
met:


 


(i)  the
accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse
Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company and Chanticleer
contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);


 


(ii)  all
obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been
performed;


 


(iii)  the
delivery by the Company and Chanticleer of the items set forth in Section 2.2(a) of this Agreement;


 


(v)  there
shall have been no Material Adverse Effect with respect to the Company since the date hereof;


 




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(vi)  all
conditions to the closing of the Merger, other than the transactions contemplated by this Agreement, shall have been satisfied,
and the Common Stock shall have been distributed to the stockholders of Chanticleer entitled thereto pursuant to the Distribution
Agreement; and


 


(vii)  the
Company shall have funded proceeds of $1,500,000 gross third party equity funding on terms reasonably satisfactory to Oz Rey.


 


2.4
Post Closing Covenants.




 


(i)  the
Company’s market maker will submit a Form 211 for the quotation of the Company’s common stock on the OTCQB or OTQX
as soon as practical following closing of the Merger;


 


(ii)  the
Company will file a registration statement under the Exchange Act on Form 10, in form and substance reasonably satisfactory to
Oz Rey, registering the Common Stock under Section 12(g) of the Exchange Act promptly following closing of the Merger


 


(iii)  promptly
following (a) the termination of the Company’s contractual restrictions on assignment thereof, and (b) Oz Rey’s cash
exercise of the Warrants originally exercisable at $0.50 per share (the “$0.50 Warrants”) issued to Oz Rey
pursuant hereto, the Company shall assign to Oz Rey up to 17,792 of the Company’s warrants to purchase shares of common
stock of Chanticleer (“Chanticleer Warrants”). Prior to such transfer, the Company shall not exercise or assign
such Chanticleer warrants except as contractually obligated to do otherwise with Arena Investors, LP. The number of Chanticleer
Warrants to be transferred to Oz Rey shall be determined upon each cash exercise of $0.50 Warrants. Upon the cash exercise of
all 462,600 $0.50 Warrants, all 17,792 Chanticleer Warrants shall be transferred. Upon a partial exercise of the $0.50 Warrants,
one (1) Chanticleer Warrant shall be transferred to Oz Rey for each twenty six (26) $.050 Warrants cash exercised.


 


ARTICLE
III.

 REPRESENTATIONS AND WARRANTIES


 


3.1  Representations
and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure Schedules shall be deemed
a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained in the corresponding
section of the Disclosure Schedules, the Company hereby makes the following representations and warranties to each Purchaser:


 


(a)  Subsidiaries.
All of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a). The Company owns, directly
or indirectly, the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued
and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive
and similar rights to subscribe for or purchase securities.


 




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(b)  Organization
and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power
and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company
nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity
or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business,
prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction
Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been instituted in
any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.


 


(c)
Authorization; Enforcement.




 


(i) The
Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this
Agreement and each of the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The
execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it
of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company
and no further action is required by the Company, the Board of Directors or the Company’s stockholders in connection herewith
or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which
it is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the
terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance
with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by
laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as
indemnification and contribution provisions may be limited by applicable law.


 




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(ii) With
respect to the Subsidiary Guarantee, each of the Subsidiaries has the requisite corporate power and authority to enter into and
to consummate the transactions contemplated by such agreement and otherwise to carry out its obligations thereunder. The execution
and delivery of the Subsidiary Guarantee and the consummation by the Company of the transactions contemplated thereby have been
duly authorized by all necessary action on the part of the Company, and no further action is required by the respective Subsidiary,
its managers or its members in connection therewith. The Subsidiary Guarantee has been (or upon delivery will have been) duly
executed by the respective Subsidiaries and, when delivered in accordance with the terms thereof, will constitute the valid and
binding obligation of the respective Subsidiary enforceable against such Subsidiary in accordance with its terms, except: (A)
as listed by general equitable principals and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors’ rights generally, (B) as limited by laws relating to the availability
of specific performance, injunctive relief or other equitable remedies and (C) insofar as indemnification and contribution provisions
may be limited by applicable law.


 


(d) No
Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to
which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby
and thereby do not and will not: (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate
or articles of incorporation, bylaws or other organizational or charter documents, (ii) conflict with, or constitute a default
(or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon
any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration
or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing
a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which
any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict
with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court
or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations),
or by which any property or asset of the Company or a Subsidiary is bound or affected.


 


(e) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice
to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other
Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i)
the filings required pursuant to Section 4.6 of this Agreement, (ii) the notice and/or application(s) to each applicable Trading
Market for the issuance and sale of the Securities and the listing of the Warrant Shares and Conversion Shares for trading thereon
in the time and manner required thereby, and (iii) the filing of Form D with the Commission and such filings as are required to
be made under applicable state securities laws (collectively, the “Required Approvals”).


 




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(f) Issuance
of the Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction
Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company other
than restrictions on transfer provided for in the Transaction Documents. The Warrant Shares and Conversion Shares, when issued
in accordance with the terms of the Transaction Documents, will be validly issued, fully paid and nonassessable, free and clear
of all Liens imposed by the Company other than restrictions on transfer provided for in the Transaction Documents. The Company
has reserved from its duly authorized capital stock a number of shares of Common Stock for issuance of the Warrant Shares and
Conversion Shares at least equal to the Required Minimum on the date hereof.


 


(g) Capitalization.
The issued, authorized and outstanding capitalization of the Company, including all rights to acquire shares of Common Stock and
the prices upon which such shares may be acquired, immediately following the Closing will be as is as set forth on Schedule
3.1(g). No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate
in the transactions contemplated by the Transaction Documents. Except as a result of the purchase and sale of the Securities,
there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating
to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to
subscribe for or acquire any shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings
or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common
Stock Equivalents or capital stock of any Subsidiary. The issuance and sale of the Securities will not obligate the Company or
any Subsidiary to issue shares of Common Stock or other securities to any Person (other than the Purchasers) and will not result
in a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities.
There are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions,
and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become
bound to redeem a security of the Company or such Subsidiary. The company does not have any stock appreciation rights or “phantom
stock” plans or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized,
validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none
of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities.
No further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale
of the Securities. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s
capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s
stockholders.


 


(h) Litigation.
There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company,
threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator,
governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”).
Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving
a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has
not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving
the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other
order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act
or the Securities Act.


 




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(i) Labor
Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of
the Company. None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s
relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective
bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good. To
the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation
of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition
agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment
of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of
the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws
and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours.


 


(j) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been
waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has
the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture,
loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is
bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any
court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation
of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental
protection, occupational health and safety, product quality and safety and employment and labor matters.


 


(k) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to pollution
or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface
strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants,
or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice
letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”);
(ii) have received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their
respective businesses; and (iii) are in compliance with all terms and conditions of any such permit, license or approval where
in each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate,
a Material Adverse Effect.


 




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(l) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports
(“Material Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating
to the revocation or modification of any Material Permit.


 


(m)Title
to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them
and good and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries,
in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not
materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii)Liens
for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP
and, the payment of which is neither delinquent nor subject to penalties (except as set forth on Schedule (m). Any real property
and facilities held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases
with which the Company and the Subsidiaries are in compliance.


 


(n) Intellectual
Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights
and similar rights as described in the SEC Reports as necessary or required for use in connection with their respective businesses
(collectively, the “Intellectual Property Rights”). None of, and neither the Company nor any Subsidiary has
received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated or been abandoned,
or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement. Neither the Company
nor any Subsidiary has received, since the date of the latest audited financial statements included within the SEC Reports, a
written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights
of any Person. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights. The Company and its Subsidiaries have taken reasonable
security measures to protect the secrecy, confidentiality and value of all of their intellectual properties.


 




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(o) Insurance.
The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including,
but not limited to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe
that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business without a significant increase in cost.


 


(p) Certain
Fees. No brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiaries to any
broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the
transactions contemplated by the Transaction Documents. The Purchasers shall have no obligation with respect to any fees or with
respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section that may be due in
connection with the transactions contemplated by the Transaction Documents.


 


(q) Private
Placement. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, no registration
under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers as contemplated
hereby. The issuance and sale of the Securities hereunder does not contravene the rules and regulations of the Trading Market.


 


(r) Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities, will
not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as
amended. The Company shall conduct its business in a manner so that it will not become an “investment company” subject
to registration under the Investment Company Act of 1940, as amended.


 


(s) Registration
Rights. Other than the holders of Series 2 Convertible Preferred Stock and related warrants, no Person has any right to cause
the Company to effect the registration under the Securities Act of any securities of the Company or any Subsidiaries.


 


(t) Application
of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement)
or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents)
or the laws of its state of incorporation that is or could become applicable to the Purchasers as a result of the Purchasers and
the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation
as a result of the Company’s issuance of the Securities and the Purchasers’ ownership of the Securities.


 




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(u) Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company
confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel
with any information that it believes constitutes or might constitute material, non-public information. The Company understands
and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of the Company.
All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their
respective businesses and the transactions contemplated hereby, including the Disclosure Schedules to this Agreement, is true
and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order
to make the statements made therein, in light of the circumstances under which they were made, not misleading. The press releases
disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any
untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they were made and when made, not misleading. The Company acknowledges
and agrees that no Purchaser makes or has made any representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in Section 3.3 hereof.


 


(v) No
Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2,
neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made
any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering
of the Securities to be integrated with prior offerings by the Company for purposes of (i) the Securities Act which would require
the registration of any such securities under the Securities Act, or (ii) any applicable shareholder approval provisions of any
Trading Market on which any of the securities of the Company are listed or designated.


 


(w) Solvency.
Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the
Company of the proceeds from the sale of the Securities hereunder: (i) the fair saleable value of the Company’s assets exceeds
the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including
known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to
carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular
capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability
thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate
all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in
respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt).
The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation
under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(s)
sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which
the Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x)
any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether
or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business;
and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance
with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness that has not been cured or is
being cured in connection with this Transaction.


 


(x) Tax
Status. Except as set forth on Schedule 3.1(x), the Company and its Subsidiaries each (i) has made or filed all United States
federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction
to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown
or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate
for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Company or of any Subsidiary know of no basis for any such claim.


 




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(y) No
General Solicitation. Neither the Company nor any Person acting on behalf of the Company has offered or sold any of the Securities
by any form of general solicitation or general advertising. The Company has offered the Securities for sale only to the Purchasers
and certain other “accredited investors” within the meaning of Rule 501 under the Securities Act.


 


(z) Foreign
Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent
or other person acting on behalf of the Company or any Subsidiary, has: (i) directly or indirectly, used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any
unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns
from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person
acting on its behalf of which the Company is aware) which is in violation of law or (iv) violated in any material respect any
provision of FCPA.


 


(aa)
Accountants. The Company’s accounting firm is Cherry Bekaert LLP. To the knowledge and belief of the Company, such
accounting firm: (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion
with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ending December
31, 2020.


 


(bb)
Seniority. As of the Closing Date, no Indebtedness or other claim against the Company is senior to the Debentures in right
of payment, whether with respect to interest or upon liquidation or dissolution, or otherwise, other than indebtedness secured
by purchase money security interests (which is senior only as to underlying assets covered thereby) and capital lease obligations
(which is senior only as to the property covered thereby).


 


(cc)
No Disagreements with Accountants and Lawyers. There are no disagreements of any kind presently existing, or reasonably
anticipated by the Company to arise, between the Company and the accountants and lawyers formerly or presently employed by the
Company and the Company is current with respect to any fees owed to its accountants and lawyers which could affect the Company’s
ability to perform any of its obligations under any of the Transaction Documents.


 


(dd)
Acknowledgment Regarding Purchasers’ Purchase of Securities. The Company acknowledges and agrees that each of the
Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the
transactions contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary
of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby
and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction
Documents and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Securities.
The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other
Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company
and its representatives.


 


(ee)
Acknowledgment Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary
notwithstanding (except for Sections 3.2(g) and 4.15 hereof), it is understood and acknowledged by the Company that: (i) none
of the Purchasers has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling,
long and/or short, securities of the Company, or “derivative” securities based on securities issued by the Company
or to hold the Securities for any specified term, (ii) past or future open market or other transactions by any Purchaser, specifically
including, without limitation, Short Sales or “derivative” transactions, before or after the closing of this or future
private placement transactions, may negatively impact the market price of the Company’s publicly-traded securities, (iii)
any Purchaser, and counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or
indirectly, may presently have a “short” position in the Common Stock and (iv) each Purchaser shall not be deemed
to have any affiliation with or control over any arm’s length counter-party in any “derivative” transaction.
The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times
during the period that the Securities are outstanding, including, without limitation, during the periods that the value of the
Warrant Shares and Conversion Shares deliverable with respect to Securities are being determined, and (z) such hedging activities
(if any) could reduce the value of the existing stockholders’ equity interests in the Company at and after the time that
the hedging activities are being conducted. The Company acknowledges that such aforementioned hedging activities do not constitute
a breach of any of the Transaction Documents.


 




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(ff)
Regulation M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly
or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or paid any compensation
for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting
another to purchase any other securities of the Company.


 


(gg)
Office of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director,
officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered
by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).


 


(hh)
U.S. Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation
within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s
request.


 


(ii)
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding
Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve
System (the “Federal Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls,
directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent
or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither
the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank
or any entity that is subject to the BHCA and to regulation by the Federal Reserve.


 


(jj)
Money Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance
with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of
1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money
Laundering Laws”), and no Action or Proceeding by or before any court or governmental agency, authority or body or any
arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of
the Company or any Subsidiary, threatened.


 




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(kk)
No Disqualification Events. With respect to the Securities to be offered and sold hereunder in reliance on Rule 506 under
the Securities Act, none of the Company, any of its predecessors, any affiliated issuer, any director, executive officer, other
officer of the Company participating in the offering hereunder, any beneficial owner of 20% or more of the Company’s outstanding
voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under
the Securities Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person”
and, together, “Issuer Covered Persons”) is subject to any of the “Bad Actor” disqualifications
described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except for
a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any
Issuer Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure
obligations under Rule 506(e), and has furnished to the Purchasers a copy of any disclosures provided thereunder.


 


(ll)
Other Covered Persons. The Company is not aware of any person (other than any Issuer Covered Person) that has been or will
be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale of any Securities.


 


(mm)
Notice of Disqualification Events. The Company will notify the Purchasers in writing, prior to the Closing Date of (i)
any Disqualification Event relating to any Issuer Covered Person and (ii) any event that would, with the passage of time, become
a Disqualification Event relating to any Issuer Covered Person.


 


(nn)
Use of Proceeds. Schedule 3.1(nn) sets forth the use of the proceeds for the $6,000,000 payment made by Sonnet to
the Company, the proceeds of the Warrant Exercises, and the $1,500,000 financing received by the Company.


 


3.2 Representations
and Warranties of Chanticleer. Except as set forth in the Disclosure Schedules, which Disclosure Schedules shall be deemed
a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained in the corresponding
section of the Disclosure Schedules, Chanticleer hereby makes the following representations and warranties to each Purchaser:


 


(a) Organization
and Qualification. Chanticleer is an entity duly incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets
and to carry on its business as currently conducted. Chanticleer is not in violation nor default of any of the provisions of its
certificate of incorporation, bylaws or other organizational or charter documents. Chanticleer is duly qualified to conduct business
and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted
or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity
or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business,
prospects or condition (financial or otherwise) of Chanticleer and its subsidiaries, taken as a whole, or (iii) a material adverse
effect on Chanticleer’s ability to perform in any material respect on a timely basis its obligations under any Transaction
Document (any of (i), (ii) or (iii), a “Chanticleer Material Adverse Effect”), and no Proceeding has been instituted
in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.


 




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(b) Authorization;
Enforcement. Chanticleer has the requisite corporate power and authority to enter into and to consummate the transactions
contemplated by this Agreement and each of the other Transaction Documents and otherwise to carry out its obligations hereunder
and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by Chanticleer and the
consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the
part of Chanticleer and no further action is required by Chanticleer, the Board of Directors or Chanticleer’s stockholders
in connection herewith or therewith. This Agreement and each other Transaction Document to which it is a party has been (or upon
delivery will have been) duly executed by Chanticleer and, when delivered in accordance with the terms hereof and thereof, will
constitute the valid and binding obligation of Chanticleer enforceable against Chanticleer in accordance with its terms, except:
(i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws
of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability
of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions
may be limited by applicable law.


 


(c) No
Conflicts. The execution, delivery and performance by Chanticleer of this Agreement and the other Transaction Documents to
which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby
and thereby do not and will not: (i) conflict with or violate any provision of Chanticleer’s certificate of incorporation,
bylaws or other organizational or charter documents, (ii) conflict with, or constitute a default (or an event that with notice
or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets
of Chanticleer, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice,
lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company debt or otherwise) or
other understanding to which Chanticleer is a party or by which any property or asset of Chanticleer is bound or affected, or
(iii) conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction
of any court or governmental authority to which Chanticleer is subject (including federal and state securities laws and regulations),
or by which any property or asset of Chanticleer is bound or affected; except in the case of each of clauses (ii) and (iii), such
as could not have or reasonably be expected to result in a Chanticleer Material Adverse Effect.


 


(d) Filings,
Consents and Approvals. Chanticleer is not required to obtain any consent, waiver, authorization or order of, give any notice
to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other
Person in connection with the execution, delivery and performance by Chanticleer of the Transaction Documents.


 




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(e) SEC
Reports; Financial Statements. Chanticleer’ has timely filed all reports, statements and documents required under the
Securities Act and Exchange Act (the foregoing materials, including the exhibits thereto and documents incorporated by reference
therein, being collectively referred to herein as the “SEC Reports”). As of their respective dates, the SEC
Reports complied in all material respects with the requirements of the Exchange Act, and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Chanticleer
has never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements of Chanticleer included in
the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission
with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United
States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”),
except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Chanticleer
and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods
then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.


 


(f) Material
Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included
within the SEC Reports: (i) there has been no event, occurrence or development that has had or that could reasonably be expected
to result in a Material Adverse Effect, (ii) the Chanticleer has not incurred any liabilities (contingent or otherwise) other
than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B)
liabilities not required to be reflected in the Chanticleer’s financial statements pursuant to GAAP or disclosed in filings
made with the Commission, (iii) the Chanticleer has not altered its method of accounting, (iv) the Chanticleer has not declared
or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements
to purchase or redeem any shares of its capital stock except for quarterly dividend payment in common stock to its Series 1 Preferred
Unit holders and (v) other than included within the SEC Reports, \Chanticleer has not issued any equity securities to any officer,
director or Affiliate. The Chanticleer does not have pending before the Commission any request for confidential treatment of information.
Except for the issuance of the Securities contemplated by this Agreement or as set forth on Schedule 3.2(f), no event,
liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with
respect to the Chanticleer or its Subsidiaries or their respective businesses, properties, operations, assets or financial condition,
that would be required to be disclosed by the Chanticleer under applicable securities laws at the time this representation is
made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation is
made.


 




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3.3 Representations
and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents and warrants as
of the date hereof and as of the Closing Date to the Company and Chanticleer as follows (unless as of a specific date therein,
in which case they shall be accurate as of such date):


 


(a) Organization;
Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability
company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents
and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and
performance by such Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary
corporate, partnership, limited liability company or similar action, as applicable, on the part of such Purchaser. Each Transaction
Document to which it is a party has been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with
the terms hereof, will constitute the valid and legally binding obligation of such Purchaser, enforceable against it in accordance
with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by
laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as
indemnification and contribution provisions may be limited by applicable law.


 


(b) Own
Account. Such Purchaser understands that the Securities are “restricted securities” and have not been registered
under the Securities Act or any applicable state securities law and is acquiring the Securities as principal for its own account
and not with a view to or for distributing or reselling such Securities or any part thereof in violation of the Securities Act
or any applicable state securities law, has no present intention of distributing any of such Securities in violation of the Securities
Act or any applicable state securities law and has no direct or indirect arrangement or understandings with any other persons
to distribute or regarding the distribution of such Securities in violation of the Securities Act or any applicable state securities
law (this representation and warranty not limiting such Purchaser’s right to sell the Securities pursuant to a registration
statement or otherwise in compliance with applicable federal and state securities laws). Such Purchaser is acquiring the Securities
hereunder in the ordinary course of its business.


 


(c) Purchaser
Status. At the time such Purchaser was offered the Securities, it was, and as of the date hereof it is, and on each date on
which it exercises any Warrants it will be an “accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3),
(a)(7) or (a)(8) under the Securities Act.


 


(d) Experience
of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment
in the Securities, and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk
of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment.


 




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(e) General
Solicitation. Such Purchaser is not, to such Purchaser’s knowledge, purchasing the Securities as a result of any advertisement,
article, notice or other communication regarding the Securities published in any newspaper, magazine or similar media or broadcast
over television or radio or presented at any seminar or any other general solicitation or general advertisement.


 


(f) Access
to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including
all exhibits and schedules thereto) and the SEC Reports and has been afforded (i) the opportunity to ask such questions as it
has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the
offering of the Securities and the merits and risks of investing in the Securities; (ii) access to information about the Company
and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to
evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire
without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.


 


Each
of the Company and Chanticleer acknowledges and agrees that the representations contained in this Section 3.3 shall not modify,
amend or affect such Purchaser’s right to rely on the Company’s or Chanticleer’s representations and warranties
contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other document
or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions contemplated
hereby.


 


ARTICLE
IV.


OTHER
AGREEMENTS OF THE PARTIES


 


4.1
Transfer Restrictions.




 


(a) The
Securities may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of Securities
other than pursuant to an effective registration statement or Rule 144, to the Company or to an Affiliate of a Purchaser or in
connection with a pledge as contemplated in Section 4.1(b), the Company may require the transferor thereof to provide to the Company
an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion
shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such transferred
Securities under the Securities Act. As a condition of transfer, any such transferee shall agree in writing to be bound by the
terms of this Agreement and shall have the rights and obligations of a Purchaser under this Agreement.


 




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(b) The
Purchasers agree to the imprinting, so long as is required by this Section 4.1, of a legend on any of the Securities in the following
form:


 


[NEITHER]
THIS SECURITY [NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE [EXERCISABLE] HAS [NOT] 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 SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS
SECURITY [AND THE SECURITIES ISSUABLE UPON CONVERSION [EXERCISE] OF THIS SECURITY] MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR”
AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.


 


The
Company acknowledges and agrees that a Purchaser may from time to time pledge pursuant to a bona fide margin agreement with a
registered broker-dealer or grant a security interest in some or all of the Securities to a financial institution that is an “accredited
investor” as defined in Rule 501(a) under the Securities Act and, if required under the terms of such arrangement, such
Purchaser may transfer pledged or secured Securities to the pledgees or secured parties. Such a pledge or transfer would not be
subject to approval of the Company and no legal opinion of legal counsel of the pledgee, secured party or pledgor shall be required
in connection therewith. Further, no notice shall be required of such pledge. At the appropriate Purchaser’s expense, the
Company will execute and deliver such reasonable documentation as a pledgee or secured party of Securities may reasonably request
in connection with a pledge or transfer of the Securities.


 


(c) Certificates
evidencing the Shares shall not contain any legend (including the legend set forth in Section 4.1(b) hereof): (i) while a registration
statement covering the resale of such security is effective under the Securities Act, (ii) following any sale of such Shares pursuant
to Rule 144, (iii) if such Shares are eligible for sale under Rule 144 or (iv) if such legend is not required under applicable
requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission).
The Company shall cause its counsel to issue a legal opinion to the Transfer Agent if required by the Transfer Agent to effect
the removal of the legend hereunder. If all or any portion of a Warrant is exercised or a New Debenture is converted at a time
when there is an effective registration statement to cover the resale of the Shares, or if such Shares may be sold under Rule
144 without the requirement for the Company to be in compliance with the current public information required under Rule 144 as
to such Shares and without volume or manner-of-sale restrictions or if such legend is not otherwise required under applicable
requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission)
then such Shares shall be issued free of all legends. The Company agrees that following the Effective Date or at such time as
such legend is no longer required under this Section 4.1(c), it will, no later than the earlier of (i) three (3) Trading Days
and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined below) following the delivery by a Purchaser
to the Company or the Transfer Agent of a certificate representing Shares, as applicable, issued with a restrictive legend (such
third Trading Day, the “Legend Removal Date”), deliver or cause to be delivered to such Purchaser a certificate
representing such shares that is free from all restrictive and other legends. The Company may not make any notation on its records
or give instructions to the Transfer Agent that enlarge the restrictions on transfer set forth in this Section 4. Certificates
for Shares subject to legend removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the account
of the Purchaser’s prime broker with the Depository Trust Company System as directed by such Purchaser. As used herein,
“Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on
the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of a certificate
representing Shares, as applicable, issued with a restrictive legend.


 




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(e)
Each Purchaser, severally and not jointly with the other Purchasers, agrees with the Company that such Purchaser will sell any
Securities pursuant to either the registration requirements of the Securities Act, including any applicable prospectus delivery
requirements, or an exemption therefrom, and that if Securities are sold pursuant to a Registration Statement, they will be sold
in compliance with the plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from
certificates representing Securities as set forth in this Section 4.1 is predicated upon the Company’s reliance upon this
understanding.


 


4.2 Acknowledgment
of Dilution. The Company acknowledges that the issuance of the Securities may result in dilution of the outstanding shares
of Common Stock, which dilution may be substantial under certain market conditions. The Company further acknowledges that its
obligations under the Transaction Documents, including, without limitation, its obligation to issue the Shares pursuant to the
Transaction Documents, are unconditional and absolute and not subject to any right of set off, counterclaim, delay or reduction,
regardless of the effect of any such dilution or any claim the Company may have against any Purchaser and regardless of the dilutive
effect that such issuance may have on the ownership of the other stockholders of the Company.


 


4.3 Furnishing
of Information; Public Information. Until the Warrants have expired and the New Debentures have been paid in full, the Company
covenants to promptly seek and, thereafter, maintain the registration of the Common Stock under Section 12(b) or 12(g) of the
Exchange Act and to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports
required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then subject
to the reporting requirements of the Exchange Act.


 




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4.4 Integration.
The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined
in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require
the registration under the Securities Act of the sale of the Securities or that would be integrated with the offer or sale of
the Securities for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval
prior to the closing of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.


 


4.5
Exercise Procedures.




 


(a) The
form of Notice of Exercise included in the Warrants set forth the totality of the procedures required of the Purchasers in order
to exercise the Warrants. Without limiting the preceding sentences, no ink-original Notice of Exercise shall be required, nor
shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required in order
to exercise the Warrants. No additional legal opinion, other information or instructions shall be required of the Purchasers to
exercise their Warrants. The Company shall honor exercises of the Warrants and shall deliver Shares in accordance with the terms,
conditions and time periods set forth in the Transaction Documents.


 


(b) The
form of Notice of Conversion included in the New Debentures set forth the totality of the procedures required of the Purchasers
in order to convert the New Debentures. Without limiting the preceding sentences, no ink-original Notice of Conversion shall be
required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Conversion form be required
in order to convert the New Debentures. No additional legal opinion, other information or instructions shall be required of the
Purchasers to convert their New Debentures. The Company shall honor conversions of the New Debentures and shall deliver Shares
in accordance with the terms, conditions and time periods set forth in the Transaction Documents.


 


4.6 Securities
Laws Disclosure; Publicity. The Company shall (a) by 9:30 a.m. (New York City time) on the Trading Day immediately following
the date hereof, issue a press release disclosing the material terms of the transactions contemplated hereby, and (b) file a Current
Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission within the time required by the
Exchange Act. From and after the issuance of such press release, the Company represents to the Purchasers that it shall have publicly
disclosed all material, non- public information delivered to any of the Purchasers by the Company or any of its Subsidiaries,
or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction
Documents. In addition, effective upon the issuance of such press release, the Company acknowledges and agrees that any and all
confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries
or any of their respective officers, directors, agents, employees or Affiliates on the one hand, and any of the Purchasers or
any of their Affiliates on the other hand, shall terminate. The Company and each Purchaser shall consult with each other in issuing
any other press releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall
issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect
to any press release of any Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the
Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case
the disclosing party shall promptly provide the other party with prior notice of such public statement or communication. Notwithstanding
the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any
filing with the Commission or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except:
(a) as required by federal securities law in connection with (i) any registration statement contemplated by the Registration Rights
Agreement and (ii) the filing of final Transaction Documents with the Commission and (b) to the extent such disclosure is required
by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior notice of such disclosure
permitted under this clause (b).


 




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4.7 Shareholder
Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that
any Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted
by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of
receiving Securities under the Transaction Documents or under any other agreement between the Company and the Purchasers.


 


4.8 Non-Public
Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction
Documents, which shall be disclosed pursuant to Section 4.6, the Company covenants and agrees that neither it, nor any other Person
acting on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company
reasonably believes constitutes, material non-public information, unless prior thereto such Purchaser shall have consented to
the receipt of such information and agreed with the Company to keep such information confidential. The Company understands and
confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.
To the extent that the Company delivers any material, non-public information to a Purchaser without such Purchaser’s consent,
the Company hereby covenants and agrees that such purchaser shall not have any duty of confidentiality to Company, any of its
Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, and of
its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis of,
such material, non-public information, provided that the Purchaser shall remain subject to applicable law. To the extent that
any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding
the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report
on Form 8-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting
transactions in securities of the Company.


 


4.9 Indemnification
of Purchasers. Subject to the provisions of this Section 4.9, the Company shall indemnify and hold each Purchaser and its
directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent
role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser
(within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders,
agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles
notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”)
harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all
judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such
Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants
or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against
the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is
not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless
such action is based upon a breach of such Purchaser Party’s representations, warranties or covenants under the Transaction
Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or any violations by such
Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which constitutes fraud, gross negligence,
willful misconduct or malfeasance). If any action shall be brought against any Purchaser Party in respect of which indemnity may
be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall
have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any
Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment
thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time
to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material
conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the
Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will
not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s
prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that
a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of the representations, warranties,
covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction Documents. The indemnification
required by this Section 4.9 shall
be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received
or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any
Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.


 




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4.10
Reservation and Listing of Securities.




 


(a) The
Company shall maintain a reserve of the Required Minimum from its duly authorized shares of Common Stock for issuance pursuant
to the Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.


 


(b) If,
on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is less than the Required
Minimum on such date, then the Board of Directors shall use commercially reasonable efforts to amend the Company’s certificate
or articles of incorporation to increase the number of authorized but unissued shares of Common Stock to at least the Required
Minimum at such time, as soon as possible and in any event not later than the 75th day after such date.


 


(c) The
Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such
Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required
Minimum on the date of such application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for
listing or quotation on such Trading Market as soon as possible thereafter, (iii) provide to the Purchasers evidence of such listing
or quotation and (iv) maintain the listing or quotation of such Common Stock on any date at least equal to the Required Minimum
on such date on such Trading Market or another Trading Market. The Company agrees to maintain the eligibility of the Common Stock
for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation,
by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such
electronic transfer.


 


4.11 Form
D; Blue Sky Filings. The Company agrees to timely file a Form D with respect to the Securities as required under Regulation
D and to provide a copy thereof, promptly upon request of any Purchaser. The Company shall take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to qualify the Securities for, sale to the Purchasers
at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide
evidence of such actions promptly upon request of any Purchaser.


 


4.12 Board
of Directors. Contemporaneous with the Closing (or, if requested by Oz Rey, at the earliest practical date after the date
hereof), the Company shall appoint two directors selected Oz Rey (the “Board Appointees”) to the Board of Directors.
Within 3 Trading Days after such appointment the Company shall provide Oz Rey evidence of such appointment by copies of all of
the necessary corporate actions required to be taken by the Company in accordance to its certificate or articles of incorporation,
bylaws or other organizational or charter documents and in accordance with the laws of the State of Delaware. Furthermore, from
the date hereof until Oz Rey no longer holds any Debentures (the “Appointment Period”), Oz Rey shall have the
right, but not the obligation, to appoint the Board Appointees to the Board of Directors and Purchasers holding a majority in
interest of the Debentures may terminate such right by providing written notice to the Company. The Company agrees that it shall
have its Board of Directors or nominating committee, if it has one, re-nominate Board Appointees as a directors pursuant to this
Section 4.12 and to recommend to the Company’s stockholders that that they vote “for” such nominee, and that
all proxies given to management are voted in favor of such nominee. This Section 4.12 is subject to modification based on applicable
law, rules of trading market and, if applicable, rules of Nasdaq Stock Market.


 




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4.13. Shareholder
Approval. The number of Conversion Shares into which the Debenture may be converted and the number of Warrant Shares for which
the Warrants may be exercised shall be limited to 19.9% of the shares of Common Stock outstanding on the Original Issue Date (a)
if such a limitation is necessary to avoid a requirement from the Trading Market to receive shareholder approval of the transactions
contemplated by this Agreement and (b) which limitation will expire if shareholder approval of the transactions contemplated by
this Agreement is received. If shareholder approval is required under the rules of the Trading Market, any holder of Debentures
or Warrants shall have the right to request that the Company submit the transactions contemplated by the Purchase Agreement to
the Company’s shareholders for their approval at any annual meeting of the shareholders of the Company, and the Company
shall solicit such approval from the shareholders at such an annual meeting and recommend that the shareholders vote in favor
of such approval.


 


4.14. Release.
Effective upon the Closing, each Purchaser and the Company (in such capacity, a “Releasor”), on behalf of itself
and any of its past, present, or future affiliates, and all of their respective past and present directors, managers, shareholders,
officers, general or limited partners, members, employees, agents, attorneys, advisors, representatives, successors and assigns
hereby forever releases and discharges Chanticleer, the guarantors of the Old Debentures and all of their respective directors,
managers, shareholders, officers, general or limited partners, members, employees, agents, attorneys, advisors, representatives,
successors and assigns (collectively, the “Releasees”), from, and covenants not to sue any of the Releasees
with respect to, any and all claims, debts, demands, accounts, judgments, rights, causes of action, equitable relief, damages,
costs, charges, complaints, obligations, promises, agreements, controversies, suits, expenses, compensation, responsibility and
liability of every kind and character whatsoever (including attorneys’ fees and costs), whether in law or equity, known
or unknown, asserted or unasserted, suspected or unsuspected (collectively, “Claims”), which such Releasor
has or may have had against such Releasees or any of them on account of or arising out of the Old Debentures or the guarantees
of the Old Debentures or the acts or omissions of any Releasees with respect to the Old Debentures or the guarantees of the Old
Debentures occurring on or prior to the Closing (the “Release”), including, without limitation, any and all
Claims directly or indirectly arising out of, relating to or in any other way involving in any manner whatsoever, with respect
to the Old Debentures and the guarantees of the Old Debentures, at any time heretofore and for all time hereafter. Such Releasor
hereby also irrevocably covenants to refrain from, directly or indirectly, asserting any Claim, or commencing, instituting or
causing to be commenced, any action, arbitration, audit, hearing, investigation, litigation or suit (whether civil, criminal,
administrative, investigative or informal) of any kind against any Releasee, based upon any matter purported to be released hereby.
Notwithstanding anything else herein to the contrary, for the avoidance of doubt, the Release shall not apply to any Claims that
any Releasor may have against the Company pursuant to this Agreement or pursuant to any outstanding Warrant of Chanticleer.


 


4.15. Stock
Splits. For so long as Oz Rey holds any of the Warrants or the Debenture, the Company shall not, directly or indirectly, effect
a reverse stock split without the prior written consent of Oz Rey.


 




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ARTICLE
V.


MISCELLANEOUS


 


5.1 Termination.
This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect
whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing
has not been consummated on or before April 1, 2020; provided, however, that such termination will not affect the
right of any party to sue for any breach by any other party (or parties).


 


5.2 Fees
and Expenses. At the Closing, the Company has agreed to reimburse Oz Rey up to $250,000 for its legal fees and expenses in
connection with the Transaction Documents and its acquisition of the Old Debentures. Except as expressly set forth in the Transaction
Documents to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts,
if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance
of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for same-day
processing of any instruction letter delivered by the Company and any conversion or exercise notice delivered by a Purchaser),
stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.


 


5.3 Entire
Agreement. The Transaction Documents, together with the exhibits and schedules thereto, contain the entire understanding of
the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral
or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.


 


5.4 Notices.
Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and
shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or communication is delivered
via facsimile at the facsimile number or email as set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New
York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication is
delivered via facsimile at the facsimile number or email as set forth on the signature pages attached hereto on a day that is
not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the fifth (5th) Trading Day
following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the
party to whom such notice is required to be given. The address for such notices and communications shall be 7621 Little Avenue,
Suite 414, Charlotte, NC 28226 for Chanticleer and the Company and as set forth on Schedule 2.1 for all the Purchasers.


 


5.5 Amendments;
Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed,
in the case of an amendment, by the Company and Purchasers holding at least 67% in interest of the New Debentures then outstanding
or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought, provided that if any
amendment, modification or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent of
such disproportionately impacted Purchaser (or group of Purchasers) shall also be required. No waiver of any default with respect
to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver
of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission
of any party to exercise any right hereunder in any manner impair the exercise of any such right. Any proposed amendment or waiver
that disproportionately, materially and adversely affects the rights and obligations of any Purchaser relative to the comparable
rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected Purchaser. Any
amendment effected in accordance with accordance with this Section 5.5 shall be binding upon each Purchaser and holder of Securities
and the Company.


 




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5.6 Headings.
The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof.


 


5.7 Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted
assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of
each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any Person to
whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound, with respect
to the transferred Securities, by the provisions of the Transaction Documents that apply to the “Purchasers.”


 


5.8 No
Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors
and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as
otherwise set forth in Section 4.10 and this Section 5.8.


 


5.9 Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall
be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the
principles of conflicts of law thereof. Each party agrees that all legal Proceedings concerning the interpretations, enforcement
and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a
party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be
commenced exclusively in the state and federal courts sitting in the City of New York. Each party 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 (including
with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert
in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such Action
or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives personal service
of process and consents to process being served in any such Action or Proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement
and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If any party hereto shall
commence an Action or Proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations
of the Company under Section 4.10, the prevailing party in such Action or Proceeding shall be reimbursed by the non-prevailing
party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution
of such Action or Proceeding.


 




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5.10 Survival.
The representations and warranties contained herein shall survive the Closing and the delivery of the Securities.


 


5.11 Execution.
This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being
understood that the parties need not sign the same counterpart. Notwithstanding the foregoing, this Agreement shall be binding
upon the Company, Chanticleer and Oz Rey upon the execution of a counterpart of this Agreement by each of them, notwithstanding
that the other Purchasers may not have yet executed this Agreement. With respect to each Purchaser, this Agreement shall become
binding, following the execution hereof by the Company, Chanticleer and Oz Rey, upon such Purchaser when such Purchaser delivers
an executed copy hereof to the Company. No Warrant shall be issued to any Purchaser prior to such Purchaser’s execution
of this Agreement. This Agreement may be executed and delivered in original, via DocuSign, RightSignature or any other comparable
signature software, via facsimile or email with PDF attachment, or other commercially acceptable electronic form, in any number
of counterparts, each of which shall be deemed an original, and all of which shall together constitute but one and the same instrument,
which instrument shall for all purposes be sufficiently evidenced by any such counterpart.


 


5.12 Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain
in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially
reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that
they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.


 


5.13 Rescission
and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of)
any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction
Document and the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser
may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand
or election in whole or in part without prejudice to its future actions and rights; provided, however, that in the
case of a rescission of an exercise of a Warrant, the applicable Purchaser shall be required to return any shares of Common Stock
subject to any such rescinded exercise notice concurrently with the return to such Purchaser of the aggregate exercise price paid
to the Company for such shares and the restoration of such Purchaser’s right to acquire such shares pursuant to such Purchaser’s
Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).


 




    	31



    	 



    

 


5.14 Replacement
of Securities. If any certificate or instrument evidencing any Securities is mutilated, lost, stolen or destroyed, the Company
shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation),
or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory
to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances
shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement
Securities.


 


5.15 Remedies.
In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of
the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that
monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the
Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation
the defense that a remedy at law would be adequate.


 


5.16 Payment
Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document
or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from,
disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person
under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action),
then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived
and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.


 


5.17 Usury.
To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim,
and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at
any time hereafter in force, in connection with any Action or Proceeding that may be brought by any Purchaser in order to enforce
any right or remedy under any Transaction Document. Notwithstanding any provision to the contrary contained in any Transaction
Document, it is expressly agreed and provided that the total liability of the Company under the Transaction Documents for payments
in the nature of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”),
and, without limiting the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated
with any other sums in the nature of interest that the Company may be obligated to pay under the Transaction Documents exceed
such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by law and applicable to the Transaction
Documents is increased or decreased by statute or any official governmental action subsequent to the date hereof, the new maximum
contract rate of interest allowed by law will be the Maximum Rate applicable to the Transaction Documents from the effective date
thereof forward, unless such application is precluded by applicable law. If under any circumstances whatsoever, interest in excess
of the Maximum Rate is paid by the Company to any Purchaser with respect to indebtedness evidenced by the Transaction Documents,
such excess shall be applied by such Purchaser to the unpaid principal balance of any such indebtedness or be refunded to the
Company, the manner of handling such excess to be at such Purchaser’s election.


 




    	32



    	 



    

 


5.18 Independent
Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several
and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance
or non- performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any
other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers
are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction
Documents. Each Purchaser shall be entitled to independently protect and enforce its rights, including, without limitation, the
rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser
to be joined as an additional party in any Proceeding for such purpose. Each Purchaser has been represented by its own separate
legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience only, each
Purchaser and its respective counsel have chosen to communicate with the Company through Shearman. Shearman does not represent
any of the Purchasers other than Oz Rey. The Company has elected to provide all Purchasers with the same terms and Transaction
Documents for the convenience of the Company and not because it was required or requested to do so by any of the Purchasers.


 


5.19 Liquidated
Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction
Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other
amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages
or other amounts are due and payable shall have been canceled.


 


5.20 Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding
Business Day.


 


5.21 Construction.
The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction
Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and
every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse
and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after
the date of this Agreement.


 


5.22WAIVER
OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES
EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY
ANDEXPRESSLY WAIVES FOREVER TRIAL BY JURY.


 


(Signature
Pages Follow)


 




    	33



    	 



    

 


IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by the,ir respective authorized
signatories as of the date first indicated above.


 


	CHANTICLEER	 	COMPANY
	 	 	 
	 	 	Amergent
    Hospitality Group, in
	 	 	 	 
	/s/
    Michael D. Pruitt	 	By:	/s/
    Michael D. Pruitt
	Michael
    D. Pruitt, Chief Executive Officer	 	 	Michael
    D. Pruitt, Chief Executive Officer
	 	 	 	 
	OZREY	 	 	 
	OzRey,
    LLC	 	 	 
	 	 	 	 
	/s/
    Robert S. Hersch	 	 	 
	Robert
    S. Hersch, Manager	 	 	 




 


[SIGNATURE
PAGE
FOR SECURITIES
PURCHASE
AGREEMENT]


 




    	 



    	 



    

 


	PURCHASERS:	 	 	 
	 	 	 	 
	Jonathan
    & Nancy Glaser Family Trust DTD 

    12-16-98	 	Larry
    S. Spitcaufsky, Trustee of Larry 

    Spitcaufsky Family Trust UTD 1-19-88
	 	 	 	 	 
	By:	 	 	By:	 
	Name:	Jonathan
Glaser	 	Name:	Larry
Spitcaufsky
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	Bryan
    Ezralow TTEE of the Bryan Ezralow 1994 

    Trust DTD 12-22-94	 	EMSE,
    LLC, a Delaware limited liability company
	 	 	 	 	 
	By:	 	 	By:	 
	Name:	Bryan
Ezralow	 	Name:	Bryan
Ezralow, as Trustee of the Bryan Ezralow 1994 Trust U/T/D 12-22-94
	Title:	Trustee	 	Title:	Manager
and Member
	 	 	 	 	 
	Marc
    Ezralow 1997 Trust u/t/d 11.26.1997	 	Elevado
    Investment Company, LLC, a 

    Delaware limited liability company
	 	 	 	 	 
	By:	 	 	By:	
	Name:	Mark
Ezralow	 	Name:	Bryan
Ezralow, as Trustee of the Ezralow

                                                         Family
                                         Trust U/T/D 12/09/1980

	Title:	Trustee	 	Title:	Manager
and Member
	 	 	 	 	 
	SPA
    Trust u/t/d 09.13.2004	 	David
    Leff Family Trust u/t/d 02.03.1988
	 	 	 	 	 
	By:	 	 	By:	 
	Name:	Mark
Ezralow	 	Name:	David
Michael Leff
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	C
    and R Irrevocable Trust u/t/d 11.05.2007	 	Freedman
    Family Trust u/t/d 05.25.1982
	 	 	 	 	 
	By:	 	 	By:	 
	Name:	David
Michael Leff	 	Name:	Gary
E. Freedman
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	Freedman
    2006 Irrevocable Trust u/t/d 02.27.2006	 	Haddad
    Family Trust
	 	 	 
	By:	 	 	By:	 
	Name:	Gary
    E. Freedman	 	Name:	David
Haddad
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	 	 	 	Joshua
    and Julie Ofman Family Trust
	 	 	 	 	 
	 	 	 	By:	 
	Douglas
    S. Ramer	 	Name:	Joshua
J. Ofman
	 	 	Title:	 Trustee


 


[SIGNATURE
PAGE
FOR SECURITIES
PURCHASE
AGREEMENT]




 



    	 



    	 



    

 















	 	 	 	TR Capital Growth Fund, LLC
	 	 	 	 	 
	 	 	 	By:	 
	Karen Kang	 	Name:	 
	 	 	Title:	 
	 	 	 	                    
	 	 	 	 
	Russell Steward	 	Michael E. Meyers
	 	 	 
	CCM Holdings, Inc.	 	
        John W. Galuchie Jr. & Marianne C. Galuchie

        TTEES Galuchie Living Trust DTD 9/11/00

	 	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	 
	Title:	 	 	Title:	 
	 	 	 	 	 
	T.R. Winston & Company LLC	 	
        G. Tyler Runnels and Jasmine N. Runnels

        TTEES The Runnels Family Trust DTD 1-11-
        2000

	 	 	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	 
	Title:	 	 	Title:	 
	 	 	 	 	 
	
        Larry Steven Spitcaufsky TTEE Larry

        S. Spitcaufsky Family Trust U/A DTD 08/23/1995
	 	
        Larry Steven Spitcaufsky Charles Schwab & Co Inc.

        Cust Roth Contributory IRA

	 	 	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	 
	Title:	 	 	Title:	 




 


[SIGNATURE
PAGE
FOR SECURITIES
PURCHASE
AGREEMENT]


 







    	 



    	 



    

 


Schedule
2.1


 


	Purchaser	 	No.
    Warrants	 	 	Exercise
    Price	 	 	Contact
	Jonathan
    & Nancy Glaser Family Trust DTD 12-16-98	 	 	200,000	 	 	$	0.125	 	 	 Jon
    Glaser
	Larry
    S. Spitcaufsky, Trustee of Larry Spitcaufsky Family Trust UTD 1-19-88	 	 	400,000	 	 	$	0.125	 	 	Larry
    Spitcaufsky, Diane Peters
	Bryan
    Ezralow TTEE of the Bryan Ezralow 1994 Trust DTD 12-22-94	 	 	300,000	 	 	$	0.125	 	 	 Bryan
    Ezralow and Sherie Ingalls
	EMSE,
    LLC, a Delaware limited liability company	 	 	80,000	 	 	$	0.125	 	 	Bryan
    Ezralow and Sherie Ingalls
	Marc
    Ezralow 1997 Trust u/t/d 11.26.1997	 	 	40,000	 	 	$	0.125	 	 	Bryan
    Ezralow and Sherie Ingalls
	Elevado
    Investment Company, LLC, a Delaware limited liability company	 	 	40,000	 	 	$	0.125	 	 	 Bryan
    Ezralow and Sherie Ingalls
	 SPA
    Trust u/t/d 09.13.2004	 	 	20,000	 	 	$	0.125	 	 	Bryan
    Ezralow and Sherie Ingalls
	David
    Leff Family Trust u/t/d 02.03.1988	 	 	10,000	 	 	$	0.125	 	 	David
    Leff and Sherie Ingalls
	C
    and R Irrevocable Trust u/t/d 11.05.2007	 	 	10,000	 	 	$	0.125	 	 	David
    Leff and Sherie Ingalls
	Freedman
    Family Trust u/t/d 05.25.1982	 	 	10,000	 	 	$	0.125	 	 	Gary
    Freedman and Sherie Ingalls
	Freedman
    2006 Irrevocable Trust u/t/d 02.27.2006	 	 	10,000	 	 	$	0.125	 	 	Gary
    Freedman and Sherie Ingalls
	 Haddad
    Family Trust	 	 	40,000	 	 	$	0.125	 	 	 David
    Haddad
	 Douglas
    S. Ramer	 	 	20,000	 	 	$	0.125	 	 	 Douglas
    Ramer
	Joshua
    and Julie Ofman Family Trust	 	 	20,000	 	 	$	0.125	 	 	 Joshua
    Ofman
	Karen
    Kang	 	 	9,300	 	 	$	0.125	 	 	 
	TR
    Capital Growth Fund, LLC	 	 	5,000	 	 	$	0.125	 	 	 
	Russell
    Steward	 	 	6,580	 	 	$	0.125	 	 	 
	Michael
    E. Myers	 	 	800	 	 	$	0.125	 	 	 
	CCM
    Holdings, Inc.	 	 	800	 	 	$	0.125	 	 	 
	John
    W. Galuchie Jr. & Marianne C. Galuchie TTEES Galuchie Living Trust DTD 9/11/00	 	 	400	 	 	$	0.125	 	 	 
	T.R.
    Winston & Company, LLC	 	 	33,600	 	 	$	0.125	 	 	 
	G.
    Tyler Runnels and Jasmine N. Runnels TTEES The Runnels Family Trust DTD 1-11-2000	 	 	36,120	 	 	$	0.125	 	 	 
	Larry
    Steven Spitcaufsky TTEE Larry S. Spitcaufsky Family Trust U/A DTD 08/23/1995	 	 	30,000	 	 	$	0.125	 	 	 
	Larry
    Steven Spitcaufsky Charles Schwab & Co Inc. Cust Roth Contributory IRA	 	 	40,000	 	 	$	0.125	 	 	 
	Oz
    Rey, LLC	 	 	1,100,000	 	 	$	0.125	 	 	 Robert
    Hersch
	Oz
    Rey, LLC	 	 	462,600	 	 	$	0.50	 	 	 Robert
    Hersch
	Total	 	 	2,925,200	 	 	 	 	 	 	 



 




    	1 



    	 



    

 


Schedule
3.1(a)


The
following are the names and jurisdiction of organization of each Subsidiary.


 


	Name	 	Jurisdiction
                                         of
 Incorporation
	 	Percent
    Owned	 
	CHANTICLEER
    HOLDINGS, INC.	 	DE, USA	 	 	 	 
	 	 	 	 	 	 	 
	American
    Roadside Burgers, Inc.	 	DE, USA	 	 	100	%
	American Burger
    Ally, LLC	 	NC, USA	 	 	100	%
	American Burger
    Morehead, LLC	 	NC, USA	 	 	100	%
	American Burger
    Prosperity, LLC	 	NC, USA	 	 	50	%
	American Roadside
    Burgers Smithtown, Inc.	 	DE, USA	 	 	100	%
	BGR Acquisition,
    LLC	 	NC, USA	 	 	100	%
	BGR Franchising,
    LLC	 	VA, USA	 	 	100	%
	BGR Operations,
    LLC	 	VA, USA	 	 	100	%
	BGR Acquisition
    1, LLC	 	NC, USA	 	 	100	%
	BGR Annapolis, LLC	 	MD, USA	 	 	100	%
	BGR Arlington, LLC	 	VA, USA	 	 	46	%
	BGR Columbia, LLC	 	MD, USA	 	 	100	%
	BGR Michigan Ave,
    LLC	 	DC, USA	 	 	100	%
	BGR Mosaic, LLC	 	VA, USA	 	 	100	%
	BGR Old Keene Mill,
    LLC	 	VA, USA	 	 	100	%
	BGR Washingtonian,
    LLC	 	MD, USA	 	 	46	%
	Capitol Burger,
    LLC	 	MD, USA	 	 	100	%
	BT Burger Acquisition,
    LLC	 	NC, USA	 	 	100	%
	BT’s Burgerjoint
    Rivergate LLC	 	NC, USA	 	 	100	%
	BT’s Burgerjoint
    Sun Valley, LLC	 	NC, USA	 	 	100	%
	LBB Acquisition,
    LLC	 	NC, USA	 	 	100	%
	Cuarto LLC	 	OR, USA	 	 	100	%
	LBB Acquisition
    1 LLC	 	OR, USA	 	 	100	%
	LBB Hassalo LLC	 	OR, USA	 	 	80	%
	LBB Platform LLC	 	OR, USA	 	 	80	%
	LBB Capitol Hill
    LLC	 	WA, USA	 	 	50	%
	LBB Franchising
    LLC	 	NC, USA	 	 	100	%
	LBB Green Lake LLC	 	OR, USA	 	 	50	%
	LBB Lake Oswego
    LLC	 	OR, USA	 	 	100	%
	LBB Magnolia Plaza
    LLC	 	NC, USA	 	 	50	%
	LBB Multnomah Village
    LLC	 	OR, USA	 	 	50	%
	LBB Progress Ridge
    LLC	 	OR, USA	 	 	50	%
	LBB Rea Farms LLC	 	NC, USA	 	 	50	%
	LBB Wallingford
    LLC	 	WA, USA	 	 	50	%
	LBB Downtown PDX
    LLC	 	OR, USA	 	 	100	%
	Noveno LLC	 	OR, USA	 	 	100	%
	Octavo LLC	 	OR, USA	 	 	100	%
	Primero LLC	 	OR, USA	 	 	100	%
	Quinto LLC	 	OR, USA	 	 	100	%
	Segundo LLC	 	OR, USA	 	 	100	%
	Septimo LLC	 	OR, USA	 	 	100	%
	Sexto LLC	 	OR, USA	 	 	100	%
	Jantzen Beach Wings,
    LLC	 	OR, USA	 	 	100	%
	Oregon Owl’s
    Nest, LLC	 	OR, USA	 	 	100	%
	West End Wings LTD	 	United Kingdom	 	 	100	%



 




    	2 



    	 



    

 


Schedule
3.1(g)


 


See
Attached Spreadsheet named “Amergent Cap Table”.


 


Sonnet
- Amergent Cap Table


 





 


	Amergent Capitalization Table	 	 	 	 
	Oustanding Common as of 3/30/2020	 	 	12,855,890	 
	Common Stock issued to Arena	 	 	1,426,845	 
	Maximum No. of Common Underlying the
    Arena Bridge Preferred Stock	 	 	1,573,155	 
	Warrants - Arena	 	 	350,000	 
	Warrants - Oz Rey & Previous Debt
    Holders	 	 	2,925,200	 
	Convertible Debt
    Shares, Fully Diluted	 	 	40,378,890	 
	Total Company Outstanding
    Shares, Fully Diluted	 	 	59,509,980	 



 




    	3 



    	 



    

 


	Purchaser	 	No.
    Warrants	 	 	Exercise
    Price	 
	Jonathan
    & Nancy Glaser Family Trust DTD 12-16-98	 	 	200,000	 	 	$	0.125	 
	Larry
    S. Spitcaufsky, Trustee of Larry Spitcaufsky Family Trust UTD 1-19-88	 	 	400,000	 	 	$	0.125	 
	Bryan
    Ezralow TTEE of the Bryan Ezralow 1994 Trust DTD 12-22-94	 	 	300,000	 	 	$	0.125	 
	EMSE,
    LLC, a Delaware limited liability company	 	 	80,000	 	 	$	0.125	 
	Marc
    Ezralow 1997 Trust u/t/d 11.26.1997	 	 	40,000	 	 	$	0.125	 
	Elevado
    Investment Company, LLC, a Delaware limited liability company	 	 	40,000	 	 	$	0.125	 
	SPA
    Trust u/t/d 09.13.2004	 	 	20,000	 	 	$	0.125	 
	David
    Leff Family Trust u/t/d 02.03.1988	 	 	10,000	 	 	$	0.125	 
	C
    and R Irrevocable Trust u/t/d 11.05.2007	 	 	10,000	 	 	$	0.125	 
	Freedman
    Family Trust u/t/d 05.25.1982	 	 	10,000	 	 	$	0.125	 
	Freedman 2006 Irrevocable
    Trust u/t/d 02.27.2006	 	 	10,000	 	 	$	0.125	 
	Haddad Family Trust	 	 	40,000	 	 	$	0.125	 
	Douglas S. Ramer	 	 	20,000	 	 	$	0.125	 
	Joshua and Julie Ofman Family Trust	 	 	20,000	 	 	$	0.125	 
	Karen Kang	 	 	9,300	 	 	$	0.125	 
	TR Capital Growth Fund, LLC	 	 	5,000	 	 	$	0.125	 
	Russell Steward	 	 	6,580	 	 	$	0.125	 
	Michael E. Myers	 	 	800	 	 	$	0.125	 
	CCM Holdings, Inc.	 	 	800	 	 	$	0.125	 
	John W. Galuchie Jr. & Marianne
    C. Galuchie TTEES Galuchie Living Trust DTD 9/11/00	 	 	400	 	 	$	0.125	 
	T.R. Winston & Company, LLC	 	 	33,600	 	 	$	0.125	 
	G. Tyler Runnels and Jasmine N. Runnels
    TTEES The Runnels Family Trust DTD 1- 11-2000	 	 	36,120	 	 	$	0.125	 
	Larry Steven Spitcaufsky TTEE Larry
    S. Spitcaufsky Family Trust U/A DTD 08/23/1995	 	 	30,000	 	 	$	0.125	 
	Larry Steven Spitcaufsky Charles Schwab
    & Co Inc. Cust Roth Contributory IRA	 	 	40,000	 	 	$	0.125	 
	Oz Rey, LLC	 	 	1,100,000	 	 	$	0.125	 
	Oz Rey, LLC	 	 	462,600	 	 	$	0.500	 
	Total	 	 	2,925,200	 	 	 	 	 



 




    	4 



    	 



    

 


Schedule
3.1(m)


 


None


 




    	5 



    	 



    

 


Schedule
3.1(s)


 


See
Attached Spreadsheet Named Schedule 3.1(s).xlsx.


 




    	6 



    	 



    

 


Schedule
3.1 (s)


 


	 	 	Note
    date	 	Matures	 	 	Rate	 	 	Current	 
	Oz Rey	 	5/4/2017	 	 	3/31/2020	 	 	 	8.00	%	 	$	5,350,000	 
	Paragon (823)	 	 	 	 	8/10/2021	 	 	 	5.25	%	 	 	133,620	 
	BGR Persons Note
    - Annapolis	 	3/5/2018	 	 	3/5/2019	 	 	 	4.00	%	 	 	1,687	 
	BGR Persons Note
    - Columbia	 	10/1/2018	 	 	10/1/2019	 	 	 	4.00	%	 	 	24,163	 
	HOA Systems, LLC
    (Tacoma Wings, LLC)	 	1/7/2020	 	 	12/31/2020	 	 	 	0.00	%	 	 	100,000	 
	Sprout Funding (OKM)	 	1/28/2019	 	 	*	 	 	 	12.00	%	 	 	23,958	 
	LBB Green Lake	 	8/22/2019	 	 	*	 	 	 	12.00	%	 	 	348,269	 
	Toast Capital (LBB
    Wallingford)	 	9/18/2019	 	 	*	 	 	 	14.00	%	 	 	11,722	 
	Toast Capital (ABC
    Ally)	 	9/18/2019	 	 	*	 	 	 	14.00	%	 	 	17,171	 
	Toast Capital (ABC
    Morehead)	 	10/10/2019	 	 	*	 	 	 	14.00	%	 	 	32,751	 
	Toast
    Capital (BGR - OKM)	 	10/10/2019	 	 	*	 	 	 	14.00	%	 	 	27,834	 
	 	 	 	 	 	 	 	 	 	Total
                                         Debt	 	 	$	6,071,175	 
	*Matures
    when full amount is repaid	 	 	 	 	 	 	 	 	 	 	 



 




    	7 



    	 



    

 


Schedule
3.1(x)


 


See
Attached Spreadsheet Named Schedule 3.1(x).xlsx.


 




    	8 



    	 



    

 





	 	 	American
                                         Burger Morehead, LLC 
 NC
	 	 	American
                                         Burger Prosperity, LLC 
 NC
	 	 	American
    Roadside Ally, LLC NC	 	 	American
                                         Roadside Burgers 
 Smithtown
                                         NY
	 	 	American
                                         Roadside McBee, LLC 
 SC
	 	 	American
    Roadside Southpark LLC NC	 	 	BGR
    Annapolis LLC MD	 	 	BGR
    Arlington, LLC VA	 	 	BGR
    Dupont, LLC VA	 	 	BGR
    Columbia MD	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Penalties and Interest	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Q-1 2018	 	 	2,605.36	 	 	 	3,949.48	#	 	 	3,173.59	 	 	 	489.94	 	 	 	4,894.95	#	 	 	4,315.84	#	 	 	-00	##	 	 	8,923.11	 	 	 	9,283.88	#	 	 	-00	#
	Q-2 2018	 	 	2,943.75	 	 	 	529.70	#	 	 	4,374.57	 	 	 	426.36	 	 	 	5,548.46	#	 	 	5,586.87	#	 	 	5,115.07	##	 	 	6,718.17	 	 	 	6,355.54	#	 	 	-00	#
	Q-3 2018	 	 	1,200.87	 	 	 	252.53	#	 	 	3,518.72	 	 	 	108.58	 	 	 	4,673.91	#	 	 	3,961.03	#	 	 	3,283.01	##	 	 	3,663.28	 	 	 	4,179.93	#	 	 	-00	#
	Q-4 2018	 	 	364.30	 	 	 	195.60	#	 	 	1,553.16	 	 	 	227.60	 	 	 	1,664.34	#	 	 	1,506.12	#	 	 	711.47	##	 	 	1,753.82	 	 	 	1,665.01	#	 	 	1,754.69	#
	Q-1 2019	 	 	897.40	 	 	 	422.02	#	 	 	347.45	 	 	 	639.99	 	 	 	108.87	#	 	 	457.38	#	 	 	558.96	##	 	 	1,809.37	 	 	 	1,180.57	#	 	 	704.74	#
	Q-2 2019	 	 	2,178.62	 	 	 	888.76	#	 	 	987.56	 	 	 	1,419.84	 	 	 	-00	#	 	 	1,030.64	#	 	 	864.44	##	 	 	1,329.54	 	 	 	1,256.74	#	 	 	950.90	#
	 	 	 	10,190.29	 	 	 	6,238.09	#	 	 	13,955.05	 	 	 	3,312.30	 	 	 	16,890.54	#	 	 	16,857.87	#	 	 	10,532.95	##	 	 	24,197.29	 	 	 	23,921.67	#	 	 	3,410.33	#
	Federal, State Withholding
    and FUTA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Q-1 2018	 	 	4,874.00	 	 	 	713.89	#	 	 	1,220.56	 	 	 	1,916.63	 	 	 	2,215.07	#	 	 	2,416.73	#	 	 	-00	##	 	 	18,299.43	 	 	 	21,110.25	#	 	 	-00	#
	Q-2 2018	 	 	4,899.23	 	 	 	513.52	#	 	 	10,530.72	 	 	 	2,144.31	 	 	 	12,929.63	#	 	 	15,197.18	#	 	 	-00	##	 	 	16,398.13	 	 	 	16,544.55	#	 	 	-00	#
	Q-3 2018	 	 	3,929.40	 	 	 	1,885.75	#	 	 	14,458.09	 	 	 	2,145.01	 	 	 	16,181.59	#	 	 	16,438.44	#	 	 	8,445.03	##	 	 	18,735.65	 	 	 	18,183.50	#	 	 	-00	#
	Q-4 2018	 	 	3,643.00	 	 	 	1,956.00	#	 	 	12,148.47	 	 	 	2,276.00	 	 	 	13,234.89	#	 	 	9,606.46	#	 	 	12,970.88	##	 	 	13,754.49	 	 	 	13,278.60	#	 	 	15,250.51	#
	Q-1 2019	 	 	8,034.81	 	 	 	3,760.37	#	 	 	3,050.63	 	 	 	5,779.37	 	 	 	1,057.84	#	 	 	4,052.91	#	 	 	5,139.41	##	 	 	15,339.07	 	 	 	10,511.37	#	 	 	6,383.14	#
	Q-2 2019	 	 	18,586.00	 	 	 	7,578.00	#	 	 	8,387.00	 	 	 	12,092.00	 	 	 	-00	#	 	 	8,742.00	#	 	 	7,528.00	##	 	 	11,351.00	 	 	 	10,949.00	#	 	 	8,277.00	#
	 	 	 	43,966.44	 	 	 	16,407.53	#	 	 	49,795.47	 	 	 	26,353.32	 	 	 	45,619.02	#	 	 	56,453.72	#	 	 	34,083.32	##	 	 	93,877.77	 	 	 	90,577.27	#	 	 	29,910.65	#
	Total Liability on Spreadsheet	 	 	54,156.73	 	 	 	22,645.62	#	 	 	63,750.52	 	 	 	29,665.62	 	 	 	62,509.56	#	 	 	73,311.59	#	 	 	44,616.27	##	 	 	118,075.06	 	 	 	114,498.94	#	 	 	33,320.98	#
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Garnishments/Payments
                                  Additional Garnishments/Payments Paydown post rights-offerring 
 Total
                                         Estimated Liability
	 	 	(1,114.00	)	 	 	 	 	 	 	 	 	 	 	(1,810.00	)	 	 	 	 	 	 	(10,500.76	)	 	 	 	 	 	 	 	 	 	 	(10,954.00	)	 	 	 	 


 





    	9 



    	 



    
 


	BGR
    Michigan Ave, LLC VA	 	 	BGR
    Mosaic, LLC VA	 	 	BGR
    Old Keene Mill, LLC VA	 	 	BGR
    Old Town, LLC VA	 	 	BGR
    Springfield Mall, LLC VA	 	 	BGR
    Tysons, LLC VA	 	 	BGR
    Washingtonian, LLC MD	 	 	BT's
    Burgerjoint Biltmore, LLC NC	 	 	BT's
                                         BurgerjointProm enade, LLC 
 NC
	 	 	BT's
    Burgerjoint Rivergate LLC NC	 	 	BT's
    Burgerjoint Sun Valley, LLC NC	 	 	Capitol
    Burger, LLC MD	 	 	Chanticleer
    Holdings, Inc. NC	 
	 	129.50	#	 	 	6,353.62	#	 	 	8,506.05	#	 	 	-00	 	 	 	8,797.62	#	 	 	9,906.24	#	 	 	2,219.15	#	 	 	-00	#	 	 	5,999.03	#	 	 	6,132.91	#	 	 	6,741.16	#	 	 	6,256.17	#	 	 	5,653.30	 
	 	5,254.73	#	 	 	4,281.07	#	 	 	6,480.37	#	 	 	-00	 	 	 	5,855.84	#	 	 	4,789.12	#	 	 	3,567.24	#	 	 	-00	#	 	 	1,499.79	#	 	 	3,237.44	#	 	 	5,426.13	#	 	 	6,273.89	#	 	 	548.22	 
	 	2,641.72	#	 	 	3,013.72	#	 	 	3,678.90	#	 	 	-00	 	 	 	3,882.26	#	 	 	3,824.92	#	 	 	2,857.86	#	 	 	-00	#	 	 	1,013.30	#	 	 	3,634.48	#	 	 	2,503.78	#	 	 	5,086.91	#	 	 	1,930.76	 
	 	1,362.65	#	 	 	1,368.41	#	 	 	1,898.11	#	 	 	-00	 	 	 	1,774.94	#	 	 	1,626.33	#	 	 	17.00	#	 	 	-00	#	 	 	508.97	#	 	 	1,509.99	#	 	 	1,178.42	#	 	 	1,870.38	#	 	 	1,223.60	 
	 	1,373.37	#	 	 	1,039.94	#	 	 	1,754.94	#	 	 	-00	 	 	 	1,640.08	#	 	 	1,172.81	#	 	 	961.90	#	 	 	-00	#	 	 	-00	#	 	 	447.81	#	 	 	408.88	#	 	 	570.60	#	 	 	3,310.58	 
	 	943.34	#	 	 	842.70	#	 	 	1,193.74	#	 	 	-00	 	 	 	1,000.30	#	 	 	996.00	#	 	 	1,919.10	#	 	 	-00	#	 	 	-00	#	 	 	980.14	#	 	 	1,492.62	#	 	 	1,139.34	#	 	 	8,050.54	 
	 	11,705.31	#	 	 	16,899.45	#	 	 	23,512.12	#	 	 	-00	 	 	 	22,951.04	#	 	 	22,315.43	#	 	 	11,542.25	#	 	 	-00	#	 	 	9,021.09	#	 	 	15,942.78	#	 	 	17,750.99	#	 	 	21,197.29	#	 	 	20,717.00	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	1,822.91	#	 	 	13,815.63	#	 	 	17,408.06	#	 	 	-00	 	 	 	17,766.23	#	 	 	20,607.02	#	 	 	2,456.41	#	 	 	-00	#	 	 	11,875.70	#	 	 	12,559.38	#	 	 	13,802.31	#	 	 	17,316.04	#	 	 	12,899.81	 
	 	15,190.36	#	 	 	10,761.03	#	 	 	15,863.39	#	 	 	-00	 	 	 	14,045.41	#	 	 	13,077.99	#	 	 	6,321.20	#	 	 	-00	#	 	 	3,656.15	#	 	 	9,024.11	#	 	 	13,244.90	#	 	 	15,128.35	#	 	 	1,133.34	 
	 	13,906.45	#	 	 	12,751.22	#	 	 	18,716.17	#	 	 	-00	 	 	 	16,364.78	#	 	 	16,230.32	#	 	 	6,643.46	#	 	 	-00	#	 	 	4,217.47	#	 	 	14,803.94	#	 	 	10,313.04	#	 	 	18,448.97	#	 	 	13,726.56	 
	 	10,964.53	#	 	 	10,864.60	#	 	 	14,996.57	#	 	 	-00	 	 	 	13,970.52	#	 	 	12,856.67	#	 	 	170.00	#	 	 	-00	#	 	 	4,011.16	#	 	 	9,107.11	#	 	 	9,207.25	#	 	 	14,994.51	#	 	 	12,236.00	 
	 	11,861.10	#	 	 	8,857.88	#	 	 	14,888.72	#	 	 	-00	 	 	 	13,854.83	#	 	 	10,035.86	#	 	 	8,913.51	#	 	 	-00	#	 	 	-00	#	 	 	3,959.00	#	 	 	3,701.52	#	 	 	5,245.74	#	 	 	29,889.32	 
	 	8,210.00	#	 	 	7,199.00	#	 	 	10,186.00	#	 	 	-00	 	 	 	8,524.00	#	 	 	8,496.00	#	 	 	16,626.00	#	 	 	-00	#	 	 	-00	#	 	 	8,272.00	#	 	 	12,679.00	#	 	 	9,848.00	#	 	 	68,813.00	 
	 	61,955.35	#	 	 	64,249.36	#	 	 	92,058.91	#	 	 	-00	 	 	 	84,525.77	#	 	 	81,303.86	#	 	 	41,130.58	#	 	 	-00	#	 	 	23,760.48	#	 	 	57,725.54	#	 	 	62,948.02	#	 	 	80,981.61	#	 	 	138,698.03	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	73,660.66	#	 	 	81,148.81	#	 	 	115,571.03	#	 	 	-00	 	 	 	107,476.81	#	 	 	103,619.29	#	 	 	52,672.83	#	 	 	-00	#	 	 	32,781.57	#	 	 	73,668.32	#	 	 	80,699.01	#	 	 	102,178.90	#	 	 	159,415.03	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	(10,999.47	)	 	 	 	 	 	 	 	 	 	 	(3,691.00	)	 	 	(650.00	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(4,632.90	)	 	 	 	 	 	 	(2,358.00	)


 




    	10 



    	 



    
 


	LBB
    Cuarto LLC (Eugene) OR	 	 	Jantzen
    Beach Wings, LLC OR	 	 	JF
    Restaurants, LLC NC OR	 	 	LBB
    Hassalo LLC	 	 	LBB
    Magnolia Plaza OR	 	 	LBB
    Multnomah Village LLC OR	 	 	LBB
    Platform LLC OR	 	 	LBB
    Progress  Ridge LLC OR	 	 	LBB
    Rea Farms LLC OR	 	 	LBB
    Wallingford LLC OR	 	 	LBB
    Noveno LLC ( Alberta) OR	 	 	LBB
    Octavo LLC (Hawthorne) OR	 
	 	8,406.80	#	 	 	24,815.96	#	 	 	1,651.29	#	 	 	3,918.41	#	 	 	-00	#	 	 	-00	#	 	 	3,241.79	#	 	 	4,459.32	#	 	 	248.50	#	 	 	248.50	#	 	 	10,004.14	##	 	 	6,766.46	#
	 	6,615.03	#	 	 	26,614.00	#	 	 	111.05	#	 	 	1,277.13	#	 	 	-00	#	 	 	-00	#	 	 	897.58	#	 	 	2,831.23	#	 	 	-00	#	 	 	-00	#	 	 	7,787.80	##	 	 	4,573.54	#
	 	5,122.62	#	 	 	26,142.73	#	 	 	1,450.10	#	 	 	5,390.65	#	 	 	-00	#	 	 	3,050.57	#	 	 	1,925.93	#	 	 	2,016.44	#	 	 	-00	#	 	 	-00	#	 	 	5,045.13	##	 	 	3,950.30	#
	 	2,013.99	#	 	 	10,463.19	#	 	 	1,167.40	#	 	 	572.30	#	 	 	826.17	#	 	 	2,103.59	#	 	 	440.80	#	 	 	577.00	#	 	 	309.37	#	 	 	1,454.06	#	 	 	2,280.41	##	 	 	1,482.16	#
	 	931.07	#	 	 	3,737.93	#	 	 	1,126.55	#	 	 	686.96	#	 	 	262.34	#	 	 	2,667.44	#	 	 	596.66	#	 	 	649.79	#	 	 	160.71	#	 	 	809.04	#	 	 	1,564.40	##	 	 	1,107.18	#
	 	1,632.24	#	 	 	7,109.02	#	 	 	722.66	#	 	 	1,736.52	#	 	 	640.22	#	 	 	2,595.46	#	 	 	1,103.80	#	 	 	1,619.24	#	 	 	769.78	#	 	 	1,998.32	#	 	 	1,744.42	##	 	 	962.86	#
	 	24,721.75	#	 	 	98,882.82	#	 	 	6,229.05	#	 	 	13,581.96	#	 	 	1,728.73	#	 	 	10,417.06	#	 	 	8,206.57	#	 	 	12,153.01	#	 	 	1,488.36	#	 	 	4,509.92	#	 	 	28,426.29	##	 	 	18,842.50	#
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	19,044.72	#	 	 	1,110.85	#	 	 	210.48	#	 	 	5,621.87	#	 	 	-00	#	 	 	-00	#	 	 	5,482.28	#	 	 	6,899.50	#	 	 	-00	#	 	 	-00	#	 	 	22,012.49	##	 	 	14,950.40	#
	 	17,238.57	#	 	 	74,711.87	#	 	 	1,110.47	#	 	 	4,433.82	#	 	 	-00	#	 	 	-00	#	 	 	2,740.82	#	 	 	8,367.40	#	 	 	-00	#	 	 	-00	#	 	 	19,879.03	##	 	 	12,919.19	#
	 	19,738.04	#	 	 	98,803.68	#	 	 	10,194.49	#	 	 	19,435.80	#	 	 	-00	#	 	 	13,915.29	#	 	 	7,838.22	#	 	 	7,881.88	#	 	 	-00	#	 	 	-00	#	 	 	22,334.08	##	 	 	14,944.43	#
	 	16,477.32	#	 	 	84,944.90	#	 	 	11,674.00	#	 	 	5,723.00	#	 	 	6,986.04	#	 	 	17,275.40	#	 	 	4,408.00	#	 	 	5,770.00	#	 	 	2,616.73	#	 	 	12,406.05	#	 	 	18,580.81	##	 	 	12,069.53	#
	 	8,392.26	#	 	 	34,863.72	#	 	 	10,948.98	#	 	 	6,385.10	#	 	 	2,329.71	#	 	 	23,118.58	#	 	 	5,507.85	#	 	 	6,320.74	#	 	 	1,373.73	#	 	 	7,034.62	#	 	 	13,711.91	##	 	 	9,735.24	#
	 	14,120.00	#	 	 	61,930.00	#	 	 	7,122.00	#	 	 	15,101.00	#	 	 	5,446.00	#	 	 	22,667.00	#	 	 	9,605.00	#	 	 	14,154.00	#	 	 	6,536.00	#	 	 	17,127.00	#	 	 	15,183.00	##	 	 	8,402.00	#
	 	95,010.91	#	 	 	356,365.02	#	 	 	41,260.42	#	 	 	56,700.59	#	 	 	14,761.75	#	 	 	76,976.27	#	 	 	35,582.17	#	 	 	49,393.52	#	 	 	10,526.46	#	 	 	36,567.67	#	 	 	111,701.32	##	 	 	73,020.79	#
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	119,732.66	#	 	 	455,247.84	#	 	 	47,489.47	#	 	 	70,282.55	#	 	 	16,490.48	#	 	 	87,393.33	#	 	 	43,788.74	#	 	 	61,546.53	#	 	 	12,014.82	#	 	 	41,077.59	#	 	 	140,127.61	##	 	 	91,863.29	#
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	(6,965.00	)	 	 	(52,311.00	)	 	 	(13,943.00	)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 


 




    	11 



    	 



    
 


	Oregon
    Owl’s Nest, LLC OR	 	 	LBB
    Primero LLC (Pearl) OR	 	 	LBB
                                         LLC Quinto (Division) 
 OR
                                         
	 	 	LBB
                                         Segundo LLC 
 (Mississippi)
                                         
 OR
                                         
	 	 	LBB
    Septimo LLC (NW 23rd) OR	 	 	LBB
    Sexto LLC (Waterfront) OR	 	 	Tacoma
    Wings, LLC WA	 	 	 	 
	 	4,120.35	#	 	 	12,205.55	#	 	 	9,043.36	#	 	 	8,256.28	 	 	 	7,507.35	 	 	 	9,389.39	 	 	 	4,795.86	 	 	 	223,410.20	 
	 	4,384.58	#	 	 	9,148.18	#	 	 	7,109.24	#	 	 	6,082.81	 	 	 	2,595.30	 	 	 	7,079.17	 	 	 	4,677.33	 	 	 	176,596.31	 
	 	3,721.18	#	 	 	7,966.33	#	 	 	5,578.08	#	 	 	4,141.16	 	 	 	2,472.10	 	 	 	6,009.02	 	 	 	1,924.00	 	 	 	144,842.90	 
	 	1,704.95	#	 	 	3,137.06	#	 	 	1,961.17	#	 	 	1,672.61	 	 	 	633.40	 	 	 	2,127.37	 	 	 	614.00	 	 	 	61,275.92	 
	 	658.12	#	 	 	1,470.76	#	 	 	1,103.72	#	 	 	1,149.40	 	 	 	1,053.60	 	 	 	2,130.12	 	 	 	2,149.34	 	 	 	43,822.76	 
	 	1,215.12	#	 	 	2,141.68	#	 	 	1,286.72	#	 	 	1,246.62	 	 	 	1,760.30	 	 	 	1,497.18	 	 	 	5,101.76	 	 	 	66,348.78	 
	 	15,804.30	#	 	 	36,069.57	#	 	 	26,082.28	#	 	 	22,548.89	 	 	 	16,022.04	 	 	 	28,232.25	 	 	 	19,262.29	 	 	 	716,296.87	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	9,105.76	#	 	 	27,165.79	#	 	 	20,176.65	#	 	 	18,471.52	 	 	 	5,577.01	 	 	 	21,217.18	 	 	 	4,256.84	 	 	 	376,399.40	 
	 	11,065.18	#	 	 	23,463.98	#	 	 	18,187.80	#	 	 	15,694.42	 	 	 	6,647.03	 	 	 	18,294.81	 	 	 	1,981.85	 	 	 	433,339.74	 
	 	16,337.26	#	 	 	30,460.74	#	 	 	21,232.24	#	 	 	18,495.05	 	 	 	8,180.61	 	 	 	22,923.17	 	 	 	3,408.91	 	 	 	582,648.73	 
	 	13,801.49	#	 	 	25,599.43	#	 	 	15,966.62	#	 	 	13,685.22	 	 	 	6,334.00	 	 	 	17,379.02	 	 	 	6,140.00	 	 	 	509,335.78	 
	 	6,109.15	#	 	 	13,092.76	#	 	 	9,796.04	#	 	 	10,202.98	 	 	 	9,944.21	 	 	 	18,560.08	 	 	 	19,122.99	 	 	 	390,867.05	 
	 	10,556.00	#	 	 	18,695.00	#	 	 	11,212.00	#	 	 	10,902.00	 	 	 	15,466.00	 	 	 	13,143.00	 	 	 	43,322.00	 	 	 	573,032.00	 
	 	66,974.84	#	 	 	138,477.70	#	 	 	96,571.35	#	 	 	87,451.19	 	 	 	52,148.86	 	 	 	111,517.26	 	 	 	78,232.59	 	 	 	2,865,622.70	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	82,779.14	#	 	 	174,547.27	#	 	 	122,653.63	#	 	 	110,000.08	 	 	 	68,170.90	 	 	 	139,749.51	 	 	 	97,494.88	 	 	 	3,581,919.57	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	(4,033.00	)	 	 	(2,549.96	)	 	 	(2,302.00	)	 	 	(513.00	)	 	 	(813.60	)	 	 	(14,910.00	)	 	 	(145,050.69	)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(48,653.00	)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	(546,847.00	)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	2,841,368.88	 


 




    	12 



    	 



    

 


Schedule
3.1(nn)


 


	Sonnet
    Merger Closing Uses	 
	 	 	$	 
	Repayment Sonnet Loan	 	 	214,083	 
	TowneBank Payoff (Paragon Bank)	 	 	133,620	 
	Redemption of the preferred stock	 	 	880,289	 
	Black-Shoal Investors	 	 	66,900	 
	Arena Escrow Account	 	 	1,250,000	 
	Paydown of Oz Rey Debt	 	 	1,350,000	 
	Shearman & Sterling	 	 	200,000	 
	Libertas Law	 	 	85,000	 
	K&L Gates	 	 	19,335	 
	Elliott Davis	 	 	65,977	 
	Cherry Bekaert	 	 	93,845	 
	Amergent
    Hospitality Group, Inc. (Funded to Spark Team Associate, LLC - 100% owned subsidiary of Amergent)	 	 	1,640,950	 
	Total Uses of Cash	 	$	6,000,000	 




 


	Amergent
    Hospitality Closing Uses	 
	 	 	$	 
	Just Fresh Sellers	 	 	188,000	 
	Ecton Law Firm
    - Settlement for Payroll Tax Cases of Stores	 	 	65,000	 
	Total Uses of Cash	 	$	253,000	 



 




    	13 



    	 



    

 


Schedule
3.2(f)


 


None


 




    	14 



    	 



    

 


Exhibit
A


 


Original
Issue Date: April 1, 2020


 


10.0%
SECURED CONVERTIBLE DEBENTURE DUE APRIL 1, 2022


 


THIS
10.0% SECURED CONVERTIBLE DEBENTURE is one of a series of duly authorized and validly issued 10.0% Secured Convertible Debentures
of Amergent Hospitality Group, Inc., a Delaware corporation (the “Company”), having its principal place of
business at 7621 Little Ave, Suite 414, Charlotte, NC 28226, designated as its 10.0% Secured Convertible Debenture due April 1,
2022 (this debenture, the “Debenture” and, collectively with the other debentures of such series, the “Debentures”).


 


FOR
VALUE RECEIVED, the Company promises to pay to Oz Rey, LLC or its registered assigns (the “Holder”), or shall
have paid pursuant to the terms hereunder, the principal sum of Four Million Dollars ($4,037,889.00) on April 1, 2022 (the “Maturity
Date”) and to pay interest to the Holder on the aggregate then outstanding principal amount of this Debenture in accordance
with the provisions hereof. The Maturity Date may be extended, at the sole option of the Holder for a two-year period. At the
election of the Holder, the Maturity Date may be extended for additional two-year periods, provided that in no event shall the
Maturity Date be extended beyond 10 years from the Original Issue Date. This Debenture is subject to the following additional
provisions:


 


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


 


“Alternate
Consideration” shall have the meaning set forth in Section 6(e).


 


“Bankruptcy
Event” means any of the following events: (a) the Company or any Subsidiary thereof commences a case or other proceeding
under any bankruptcy, reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation
or similar law of any jurisdiction relating to the Company or any Subsidiary thereof, (b) there is commenced against the Company
or any Subsidiary thereof any such case or proceeding that is not dismissed within 60 days after commencement, (c) the Company
or any Subsidiary thereof is adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or
proceeding is entered, (d) the Company or any Subsidiary thereof suffers any appointment of any custodian or the like for it or
any substantial part of its property that is not discharged or stayed within 60 calendar days after such appointment, (e) the
Company or any Subsidiary thereof makes a general assignment for the benefit of creditors, (f) the Company or any Subsidiary thereof
calls a meeting of its creditors with a view to arranging a composition, adjustment or restructuring of its debts, (g) the Company
or any Subsidiary thereof admits in writing that it is generally unable to pay its debts as they become due, (h) the Company or
any Subsidiary thereof, by any act or failure to act, expressly indicates its consent to, approval of or acquiescence in any of
the foregoing or takes any corporate or other action for the purpose of effecting any of the foregoing.


 




    	 



    	 



    




 


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


 


“Change
of Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date hereof
by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act)
of effective control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise)
of a majority of the voting securities of the Company, (b) the Company merges into or consolidates with any other Person, or any
Person merges into or consolidates with the Company and, after giving effect to such transaction, the stockholders of the Company
immediately prior to such transaction own less a majority of the aggregate voting power of the Company or the successor entity
of such transaction, (c) the Company sells or transfers all or substantially all of its assets to another Person and the stockholders
of the Company immediately prior to such transaction own less than a majority of the aggregate voting power of the acquiring entity
immediately after the transaction, (d) a replacement at one time or within a three year period of more than one-half of the members
of the Board of Directors which is not approved by a majority of those individuals who are members of the Board of Directors on
the Original Issue Date (or by those individuals who are serving as members of the Board of Directors on any date whose nomination
to the Board of Directors was approved by a majority of the members of the Board of Directors who are members on the date hereof),
or (e) the execution by the Company of an agreement to which the Company is a party or by which it is bound, providing for any
of the events set forth in clauses (a) through (d) above.


 


“Common
Stock” means the common stock of the Company.


 


“Common
Stock Equivalent” means any securities of the Company entitling the holder thereof to acquire at any time Common Stock,
including, without limitation, any debt, preferred stock, rights, options, warrants or other instrument that is at any time convertible
into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.


 


“Debenture
Register” shall have the meaning set forth in Section 2(b).


 


“EBITDA”
shall equal the Company’s consolidated net income as shown on the Company’s Form 10-K or 10-Q for the applicable period
(excluding extraordinary gains or losses) before provision for interest expense, taxes, depreciation and amortization.


 


“Event
of Default” shall have the meaning set forth in Section 9(a).


 




    	 2



    	 



    

 


“Fixed
Conversion Price” shall initially be $0.10 per share of Common Stock, subject to adjustment as provided for herein.


 


“Fundamental
Transaction” shall have the meaning set forth in Section 4.


 


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


 


“Lien”
means a mortgage, deed of trust, pledge, hypothecation, assignment, security interest, encumbrance, lien or other security interest
or security agreement of any kind or nature whatsoever.


 


“Late
Fees” shall have the meaning set forth in Section 2(c).


 


“New
York Courts” shall have the meaning set forth in Section 10(d).


 


“Notice
of Conversion” means a notice in the form of Attachment A.


 


“Original
Issue Date” means the date of the first issuance of the Debentures, regardless of any transfers of any Debenture and
regardless of the number of instruments which may be issued to evidence such Debentures.


 


“Permitted
Indebtedness” means (a) the indebtedness evidenced by the Debentures and (b) the Indebtedness existing on the Original
Issue Date and set forth on Schedule 3.1(aa) attached to the Purchase Agreement.


 


“Permitted
Lien” means the individual and collective reference to the following:


(a) Liens
for taxes, assessments and other governmental charges or levies not yet due or Liens for taxes, assessments and other governmental
charges or levies being contested in good faith and by appropriate proceedings for which adequate reserves (in the good faith
judgment of the management of the Company) have been established in accordance with GAAP, (b) Liens imposed by law which were
incurred in the ordinary course of the Company’s business, such as carriers’, warehousemen’s and mechanics’
Liens, statutory landlords’ Liens, and other similar Liens arising in the ordinary course of the Company’s business,
and which (x) do not individually or in the aggregate materially detract from the value of such property or assets or materially
impair the use thereof in the operation of the business of the Company and its consolidated Subsidiaries or (y) are being contested
in good faith by appropriate proceedings, which proceedings have the effect of preventing for the foreseeable future the forfeiture
or sale of the property or asset subject to such Lien, (c) Liens incurred in connection with Permitted Indebtedness under clauses
(a) and (b).


 


“Purchase
Agreement” means the Securities Purchase Agreement, dated as of April 1, 2020 among the Company, Chanticleer Holdings,
Inc. and the original Holders, as amended, modified or supplemented from time to time in accordance with its terms.


 


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


 




    	 3



    	 



    

 


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


 


“Trading
Day” means a day on which the principal market or exchange, on which the Common Stock is listed or quoted for trading,
is open (e.g. the Nasdaq Capital Market, the NYSE AMEX Equities Exchange, the New York Stock Exchange, the OTC Bulletin Board,
OTCQX, OTCQB or the Pink Sheets as operated by OTC Markets Group, Inc., etc.).


 


“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the
New York Stock Exchange (or any successors to any of the foregoing).


 


“Conversion
Price” means the lower of (a) the Fixed Conversion Price and (b) the VWAP for the Common Stock on the 10 Trading Days
immediately prior to delivery of the Conversion Notice.


 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX
as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common
Stock are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d)
in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the holders of a majority in principal amount of the Debentures then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.


 


Section
2. Interest.


 


a) Payment
of Interest in Cash. The Company shall pay interest to the Holder on the aggregate then outstanding principal amount of this
Debenture in cash at the rate of 10.0% per annum, payable quarterly on January 1, April 1, July 1 and October 1, beginning on
the first such date after the Original Issue Date, and on the Maturity Date (each such date, an “Interest Payment Date”)
(if any Interest Payment Date is not a Business Day, then the applicable payment shall be due on the next succeeding Business
Day).


 


b) Interest
Calculations. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30 calendar day periods, and
shall accrue daily commencing on the Original Issue Date until payment in full of the outstanding principal, together with all
accrued and unpaid interest, liquidated damages and other amounts which may become due hereunder, has been made. Interest hereunder
will be paid to the Person in whose name this Debenture is registered on the records of the Company regarding registration and
transfers of this Debenture (the “Debenture Register”).


 




    	 4



    	 



    

 


c) Late
Fee. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate equal to the
lesser of 18% per annum or the maximum rate permitted by applicable law (the “Late Fees”) which shall accrue
daily from the date such interest is due hereunder through and including the date of actual payment in full.


 


d) Prepayment.
Except as otherwise set forth in this Debenture, the Company may not prepay any portion of the principal amount of this Debenture
without the prior written consent of the Holder. If the Maturity Date is extended as provided herein, the Debenture will be prepayable
commencing the second anniversary of the Original Issue Date upon 15 days’ written notice to the Holder.


 


Section
3. Registration of Transfers and Exchanges.


 


a) Different
Denominations. This Debenture is exchangeable for an equal aggregate principal amount of Debentures of different authorized
denominations, as requested by the Holder surrendering the same. No service charge will be payable for such registration of transfer
or exchange.


 


b) Investment
Representations. This Debenture has been issued subject to certain investment representations of the original Holder set forth
in the Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and applicable federal
and state securities laws and regulations.


 


c) Reliance
on Debenture Register. Prior to due presentment for transfer to the Company of this Debenture, the Company and any agent of
the Company may treat the Person in whose name this Debenture is duly registered on the Debenture Register as the owner hereof
for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Debenture is overdue,
and neither the Company nor any such agent shall be affected by notice to the contrary.


 


Section
4. Fundamental Transaction. If, at any time while this Debenture is outstanding, (i) the Company, directly or indirectly,
in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell,
tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of
the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification,
reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in
one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby such other Person
acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person
or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share
purchase agreement or other business combination) (each a “Fundamental Transaction”), then, the Company shall
cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”)
to assume in writing all of the obligations of the Company under this Debenture and the other Transaction Documents (as defined
in the Purchase Agreement) in accordance with the provisions of this Section 4 pursuant to written agreements in form and substance
reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction
and shall, at the option of the holder of this Debenture, deliver to the Holder in exchange for this Debenture a security of the
Successor Entity evidenced by a written instrument substantially similar in form and substance to this Debenture, and which is
reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such 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 Debenture 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
Debenture and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.


 




    	 5



    	 



    

 


Section
5. Conversion.


 


a) Conversion
of Outstanding Balance. Beginning on the Original Issue Date and until this Debenture is no longer outstanding, this Debenture
shall be convertible, in whole or in part, into fully paid and nonassessable shares of Common Stock (“Conversion Shares”)
at the option of the Holder, upon delivery of a Notice of Conversion to the Company, at the Conversion Price. The number of Conversion
Shares into which the Debenture may be converted shall be determined by dividing the aggregate principal amount together with
all accrued interest to the date of conversion by the Conversion Price.


 


b) Conversions.
The Holder shall effect any conversions under this section by delivering to the Company a fully completed Notice of Conversion.
To effect conversions hereunder, the Holder shall not be required to physically surrender this Debenture to the Company unless
the entire principal amount of this Debenture, plus all accrued and unpaid interest thereon, has been so converted. Conversions
hereunder shall have the effect of lowering the outstanding amount of this Debenture in an amount equal to the applicable conversion.
The Holder and the Company shall maintain records showing the amount(s) converted and the date of such conversion(s). The Holder,
and any assignee by acceptance of this Debenture, acknowledge and agree that, by reason of the provisions of this paragraph, following
conversion of a portion of this Debenture, the unpaid and unconverted amount of this Debenture may be less than the amount stated
on the face hereof.


 




    	 6



    	 



    

 


c)
Mechanics of Conversion.




 


i. Delivery
of Conversion Shares Upon Conversion. Conversion Shares purchased hereunder shall be transmitted by the Transfer Agent to
the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company
through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such
system and either (A) there is an effective registration statement permitting the issuance of the Conversion Shares to or resale
of the Conversion Shares by the Holder or (B) the Conversion Shares are eligible for resale by the Holder without volume or manner-of-sale
limitations pursuant to Rule 144, and otherwise by physical delivery of a certificate, registered in the Company’s share
register in the name of the Holder or its designee, for the number of Conversion Shares to which the Holder is entitled pursuant
to such conversion to the address specified by the Holder in the Notice of Conversion by the date that is the earlier of (i) three
(3) Trading Days after the delivery to the Company of the Notice of Conversion and (ii) the number of Trading Days comprising
the Standard Settlement Period after the delivery to the Company of the Notice of Conversion (such date, the “Conversion
Share Delivery Date”). Upon delivery of the Notice of Conversion, the Holder shall be deemed for all corporate purposes
to have become the holder of record of the Conversion Shares with respect to which this Debenture has been converted, irrespective
of the date of delivery of the Conversion Shares. If the Company fails for any reason to deliver to the Holder the Conversion
Shares subject to a Notice of Conversion by the Conversion Share Delivery Date, the Company shall pay to the Holder, in cash,
as liquidated damages and not as a penalty, for each $1,000 of Conversion Shares subject to such conversion (based on the VWAP
of the Common Stock on the date of the applicable Notice of Conversion), $10 per Trading Day (increasing to $20 per Trading Day
on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day after such Conversion Share Delivery
Date until such Conversion Shares are delivered or Holder rescinds such conversion. If qualified, the Company agrees to maintain
a transfer agent that is a participant in the FAST program so long as this Debenture remains outstanding and exercisable. As used
herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of Trading
Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the
Notice of Conversion.


 


ii. Delivery
of New Debentures Upon Conversion. If this Debenture shall have been converted in part, the Company shall, at the request
of a Holder and upon surrender of this Debenture, at the time of delivery of the Conversion Shares, deliver to the Holder a new
Debenture evidencing the principal outstanding and the rights of the Holder to acquire Conversion Shares called for by this Debenture,
which new Debenture shall in all other respects be identical with this Debenture.


 


iii. Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Conversion Shares pursuant to Section
5(c)(i) by the Conversion Share Delivery Date, then the Holder will have the right to rescind such conversion.


 




    	 7



    	 



    

 


iv. Compensation
for Buy-In on Failure to Timely Deliver Conversion Shares Upon Conversion. In addition to any other rights available to the
Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Conversion Shares in accordance with the
provisions of Section 5(c)(i) above pursuant to a conversion on or before the Conversion Share Delivery Date, and if after such
date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage
firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Conversion Shares which
the Holder anticipated receiving upon such conversion (a “Buy-In”), then the Company shall (A) pay in cash
to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any)
for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Conversion Shares
that the Company was required to deliver to the Holder in connection with the conversion at issue times (2) the price at which
the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the
portion of the Debenture and equivalent number of Conversion Shares for which such conversion was not honored (in which case such
conversion shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued
had the Company timely complied with its conversion and delivery obligations hereunder. For example, if the Holder purchases Common
Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion of shares of Common Stock
with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding
sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss.
Nothing herein shall limit a 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 shares of Common Stock upon conversion of the Debenture as required pursuant to the terms hereof.


 


v. No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the conversion
of this Debenture. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion,
the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such
fraction multiplied by the Conversion Price or round up to the next whole share.


 


vi. Charges,
Taxes and Expenses. Issuance of Conversion Shares shall be made without charge to the Holder for any issue or transfer tax
or other incidental expense in respect of the issuance of such Conversion Shares, all of which taxes and expenses shall be paid
by the Company, and such Conversion Shares shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that in the event that Conversion Shares are to be issued in a name other than the name of the
Holder, this Debenture when surrendered for conversion shall be accompanied by the Assignment Form attached hereto duly executed
by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer
tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Conversion
and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required
for same-day electronic delivery of the Conversion Shares.


 




    	 8



    	 



    

 


vii. Closing
of Books. The Company will not close its stockholder books or records in any manner which prevents the timely conversion of
this Debenture, pursuant to the terms hereof.


 


Section
6. Certain Adjustments.


 


a) Stock
Dividends and Splits. If the Company, at any time while this Debenture is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable
in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon
conversion of this Debenture), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by
reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Fixed Conversion
Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury
shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common
Stock outstanding immediately after such event. Any adjustment made pursuant to this Section 6(a) shall become effective immediately
after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision, combination or re- classification.


 


b)
Anti-Dilution Protection.




 


(i) Sale
at less than Fixed Conversion Price. If the Company shall at any time or from time to time, issue, sell or otherwise dispose
of any additional shares of Common Stock (including shares owned or held by or for the account of the Company), however designated
(other than shares of Common Stock excepted from the provisions of this Section 6(b) by subsection (v) or otherwise covered by
Sections 6(a), 6(c) or 6(d)) without consideration or for a net consideration per share less than the Fixed Conversion Price in
effect immediately prior to such issuance, then, and in each such case: the Fixed Conversion Price shall be lowered to the price
(but in no event below $.0001 per share) determined by dividing (i) an amount equal to the sum of (x) the number of shares of
Common Stock outstanding immediately prior to such issue or sale multiplied by the then existing Fixed Conversion Price, and (y)
the consideration, if any, received by the Corporation upon such issue or sale, by (ii) the sum of the total number of shares
of Common Stock outstanding immediately prior to such issue or sale plus the number of shares of Common Stock so issued and sold.


 




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(ii) Sale
at less than VWAP. If the Company shall at any time or from time to time, issue, sell or otherwise dispose of any additional
shares of Common Stock (including shares owned or held by or for the account of the Company), however designated (other than shares
of Common Stock excepted from the provisions of this Section 6(b) by subsection (v) or otherwise covered by Sections 6(a), 6(c)
or 6(d)) for a net consideration per share more than the Fixed Conversion Price but less than the VWAP for the five Trading Days
immediately prior to such issuance, then, and in each such case: the Fixed Conversion Price shall be lowered to the price determined
by multiplying the Fixed Conversion Price by a fraction determined by dividing (i) an amount equal to the sum of (x) the number
of shares of Common Stock outstanding immediately prior to such issue or sale multiplied by the VWAP for the five Trading Days
immediately prior to such issuance, and (y) the consideration, if any, received by the Corporation upon such issue or sale, by
(ii) (x) the total number of shares of Common Stock outstanding immediately prior to such issue or sale plus the number of shares
of Common Stock so issued and sold multiplied by (y) the VWAP for the five Trading Days immediately prior to such issuance.


 


(iii) Definitions,
etc. For purposes of this Section 6: The issuance of any warrants, options or other subscription or purchase rights with respect
to shares of Common Stock and the issuance of any securities convertible into or exchangeable for such shares of Common Stock
(or the issuance of any warrants, options or any rights with respect to such convertible or exchangeable securities) shall be
deemed an issuance at such time of such Common Stock if the Net Consideration Per Share which may be received by the Company for
such Common Stock (as hereinafter determined) shall be less than the Fixed Conversion Price at the time of such issuance or the
VWAP for the five Trading Days immediately prior to such issuance and, except as hereinafter provided, an adjustment in the Fixed
Conversion Price shall be made upon each such issuance in the manner provided in subsection (i). Any obligation, agreement or
undertaking to issue warrants, options, or other subscription or purchase rights at any time in the future shall be deemed to
be an issuance at the time such obligation, agreement or undertaking is made or arises. Except as otherwise provided herein, no
adjustment of the Fixed Conversion Price shall be made under subsection (i) upon the issuance of any shares of Common Stock which
are issued pursuant to the exercise of any warrants, options or other subscription or purchase rights or pursuant to the exercise
of any conversion or exchange rights in any convertible securities if any adjustment shall previously have been made upon the
issuance of any such warrants, options or other rights or upon the issuance of any convertible securities (or upon the issuance
of any warrants, options or any rights therefor) as above provided. Any adjustment of the Fixed Conversion Price with respect
to this subsection (ii) which relates to warrants, options or other subscription or purchase rights with respect to shares of
Common Stock shall be disregarded if, as, and when the respective warrant, option or other subscription or purchase rights expire
or are cancelled without being converted, so that the Fixed Conversion Price effective immediately upon such cancellation or expiration
shall be equal to the Fixed Conversion Price in effect at the time of the issuance of the expired or cancelled warrants, options
or other subscriptions or purchase rights, with such additional adjustments as would have been made to that Fixed Conversion Price
had the expired or cancelled warrants, options or other subscriptions or purchase rights not been issued. For purposes of this
subsection (ii), the “Net Consideration Per Share” which may be received by the Company shall be determined as follows:


 




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(A) The
“Net Consideration Per Share” shall mean the amount equal to the total amount of consideration, if any, received
by the Company for the issuance of such warrants, options, subscriptions, or other purchase rights or convertible or exchangeable
securities, plus the minimum amount of consideration, if any, payable to the Company upon exercise or conversion thereof, divided
by the aggregate number of shares of Common Stock that would be issued if all such warrants, options, subscriptions, or other
purchase rights or convertible or exchangeable securities were exercised, exchanged or converted.


 


(B) If
the “Net Consideration Per Share” which may be received by the Company shall change (other than under or by reason
of provisions designed to protect against dilution), the Fixed Conversion Price in effect at the time of such event shall forthwith
be readjusted to the Fixed Conversion Price which would have been in effect at such time had such warrants, options, subscriptions,
or other purchase rights or convertible or exchangeable securities provided for such changed “Net Consideration Per Share”
at the time initially granted, issued or sold, but only if as a result of such adjustment the Fixed Conversion Price then in effect
hereunder is thereby reduced. If the “Net Consideration Per Share” shall be reduced at any time under or by reason
of provisions designed to protect against dilution, then in case of the delivery of Common Stock upon the exercise or conversion
of any such warrants, options, subscriptions, or other purchase rights or convertible or exchangeable securities, the Fixed Conversion
Price then in effect hereunder shall forthwith be adjusted to such amount as would have obtained had such warrant, option, subscription,
or other purchase right or convertible or exchangeable security never been issued as to such Common Stock and had adjustments
been made upon the issuance of the Common Stock delivered as aforesaid, but only if as a result of such adjustment the Fixed Conversion
Price then in effect hereunder is thereby reduced.


 




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For
purposes of this Section 6(c), if a part or all of the consideration received by the Company in connection with the issuance of
shares of the Common Stock or the issuance of any of the securities described in this Section 6(c), consists of property other
than cash, such consideration shall be deemed to have the same value as shall be determined in good faith by the board of directors
of the Company, without deduction of any expenses incurred or any underwriting commissions or concessions paid or allowed by the
Company in connection therewith.


 


(iv) Dilution
in Case of Other Securities. In case any securities other than shares of stock of the Company shall be issued or sold, or
shall become subject to issue upon the conversion or exchange of any shares of stock of the Company (or any other person referred
to in Section 4) or subscription, purchase or other acquisition pursuant to any rights or options granted by the Company (or such
other person), for a consideration per share such as to dilute the conversion rights evidenced by this Debenture, the computations,
adjustments and readjustments provided for in this Section (c) with respect to the Fixed Conversion Price shall be made as nearly
as possible in the manner so provided and applied to determine the amount of other securities from time to time receivable on
the conversion of the Debentures, so as to protect the holders of the Debentures against the effect of such dilution.


 


(v) Certain
Issues of Common Stock. Anything herein to the contrary notwithstanding, the Company shall not be required to make any adjustment
to the Fixed Conversion Price in the case of:


 


(A) the
issuance of Common Stock pursuant to any security outstanding on the Original Issue Date, including Series 2 Preferred Stock;


 


(B) the
issuance of Common Stock pursuant to any officers, directors, employees or consultants pursuant to an equity incentive compensation
plan approved by the Board of Directors.


 


c) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 6(a) above, if at any time the Company grants, issues
or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to all record
holders of any class of shares 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 Debenture immediately
before 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.


 




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d) Pro
Rata Distributions. During such time as this Debenture is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock as a class, 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)
(a “Distribution”), at any time after the issuance of this Debenture, then, in each such case, the Holder shall
be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder
had held the number of shares of Common Stock acquirable upon complete conversion of this Debenture immediately before the date
of which a record is taken for such Distribution, 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 participation in such Distribution.


 


e) Fundamental
Transaction. If, at any time while this Debenture is outstanding, a Fundamental Transaction occurs, then, upon any subsequent
conversion of this Debenture, the Holder shall have the right to receive, for each Conversion Share that would have been issuable
upon such conversion immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder, the number
of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and
any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction
by a holder of the number of shares of Common Stock for which this Debenture is convertible immediately prior to such Fundamental
Transaction. For purposes of any such conversion, the determination of the Fixed Conversion Price shall be appropriately adjusted
to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the Fixed Conversion Price among the Alternate Consideration
in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of
Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the
Holder shall be given the same choice as to the Alternate Consideration it receives upon any conversion of this Debenture following
such Fundamental Transaction. The Company shall cause any Successor Entity to assume in writing all of the obligations of the
Company under this Debenture and the other Transaction Documents in accordance with the provisions of this Section 6(e) pursuant
to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable
delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this
Debenture a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to
this Debenture which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent
entity) equivalent to the shares of Common Stock acquirable and receivable upon conversion of this Debenture prior to such Fundamental
Transaction, and with an conversion price which applies the conversion price hereunder to such shares of capital stock (but taking
into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares
of capital stock, such number of shares of capital stock and such conversion price being for the purpose of protecting the economic
value of this Debenture immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory
in form and substance to the Holder. Upon the occurrence of any such 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 Debenture
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 Debenture and
the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.


 




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f) Calculations.
All calculations under this Section 6 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 6, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall
be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.


 


g)
Notice to Holder.




 


i. Adjustment
to Fixed Conversion Price. Whenever the Fixed Conversion Price is adjusted pursuant to any provision of this Section 6, the
Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Fixed Conversion Price after such
adjustment and setting forth a brief statement of the facts requiring such adjustment.


 


ii. Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C)
the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any
shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in
connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile
or email to the Holder at its last facsimile number or email address as it shall appear upon the Debenture Register of the Company,
at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date
on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record
is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the
Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such
notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified
in such notice. The Holder shall remain entitled to conversion this Debenture during the period commencing on the date of such
notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.


 




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Section
7. Negative Covenants. As long as any portion of this Debenture remains outstanding, unless the holders of at least
67% in principal amount of the then outstanding Debentures shall have otherwise given prior written consent, the Company shall
not, and shall not permit any of the Subsidiaries to, directly or indirectly:


 


a) other
than Permitted Indebtedness, enter into, create, incur, assume, guarantee or suffer to exist any indebtedness for borrowed money
of any kind, including, but not limited to, a guarantee, on or with respect to any of its property or assets now owned or hereafter
acquired or any interest therein or any income or profits therefrom;


 


b) other
than Permitted Liens, enter into, create, incur, assume or suffer to exist any Liens of any kind, on or with respect to any of
its property or assets now owned or hereafter acquired or any interest therein or any income or profits therefrom;


 


c) amend
its charter documents, including, without limitation, its certificate of incorporation and bylaws, in any manner that materially
and adversely affects any rights of the Holder;


 


d) repay,
repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its Common Stock
or Common Stock Equivalents other than as to repurchases of Common Stock or Common Stock Equivalents of departing officers and
directors of the Company, provided that such repurchases shall not exceed an aggregate of $100,000 for all officers and directors
during the term of this Debenture;


 


e) repay,
repurchase or offer to repay, repurchase or otherwise acquire any Indebtedness, other than regularly scheduled principal and interest
payments as such terms are in effect as of the Original Issue Date;


 




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f) pay
cash dividends or distributions (other than in-kind dividends or distributions or dividends and distributions paid only in Common
Stock) on any equity securities of the Company;


 


g) enter
into any transaction with any Affiliate of the Company which would be required to be disclosed in any public filing with the Commission,
unless such transaction is made on an arm’s-length basis and expressly approved by a majority of the disinterested directors
of the Company (even if less than a quorum otherwise required for board approval);


 


h) sell,
lease or assign or agree to sell, lease or assign assets in excess of $25,000 per year outside the ordinary course of business
without prior consent the holders of at least 67% in principal amount of the then outstanding Debentures (which consent shall
not be unreasonably withheld, delayed or conditioned);


 


i)
enter into a Change of Control transaction;




 


j) increase
the number of shares of Common Stock issuable under the Management Incentive Plan;


 


k) incur
capital expenditures in excess of $50,000 per year without prior consent the holders of at least 67% in principal amount of the
then outstanding Debentures (which consent shall not be unreasonably withheld, delayed or conditioned);


 


l) hire
or terminate executive management without prior consent the holders of at least 67% in principal amount of the then outstanding
Debentures (which consent shall not be unreasonably withheld, delayed or conditioned);


 


h)
enter into any agreement with respect to any of the foregoing.


 


Section
8. Affirmative Covenants. As long as any portion of this Debenture remains outstanding, unless the holders of at least
67% in principal amount of the then outstanding Debentures shall have otherwise given prior written consent, the Company shall:


 


a)
maintain a positive EBITDA;




 


b)
timely file all reports required by Section 12(g) or Section 15(d) of the Exchange Act;


 


c)
maintain positive net earnings;




 


d) maintain
a minimum market capitalization (based upon the number of shares of Common Stock outstanding and a 30-day VWAP) of at least $5,500,000;


 


e)
use commercially reasonable efforts to list the Common Stock on the Nasdaq;


 






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f) cause
the Common Stock to be included on the OTCQX or the OTCQB as soon as is practicable following the Closing and in any event, cause
such listing to occur within 90 days of the Closing.


 


Section
9. Events of Default.


 


a) “Event
of Default” means, wherever used herein, any of the following events (whatever the reason for such event and whether
such event shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any
court, or any order, rule or regulation of any administrative or governmental body):


 


i. any
default in the payment of (A) the principal amount of any Debenture or (B) interest, liquidated damages and other amounts owing
to a Holder on any Debenture, as and when the same shall become due and payable (whether on the Maturity Date or by acceleration
or otherwise) which default, solely in the case of an interest payment or other default under clause (B) above, is not cured within
3 Trading Days;


 


ii. the
Company shall fail to observe or perform any other covenant or agreement contained in the Debentures or in any Transaction Document,
which failure is not cured, if possible to cure, within the earlier to occur of (A) 5 Trading Days after notice of such failure
sent by the Holder or by any other Holder to the Company and (B) 10 Trading Days after the Company has become or should have become
aware of such failure;


 


iii. a
default or event of default (subject to any grace or cure period provided in the applicable agreement, document or instrument)
shall occur under any of the Transaction Documents;


 


iv. any
representation or warranty made in this Debenture, any other Transaction Documents, any written statement pursuant hereto or thereto
or any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be untrue or
incorrect in any material respect as of the date when made or deemed made;


 


v. the
Company or any significant Subsidiary shall be subject to a Bankruptcy Event;


 


vi. the
Company or any Subsidiary shall default on any of its obligations under any mortgage, credit agreement or other facility, indenture
agreement, factoring agreement or other instrument under which there may be issued, or by which there may be secured or evidenced,
any indebtedness for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves an obligation
greater than $150,000, whether such indebtedness now exists or shall hereafter be created, and (b) results in such indebtedness
becoming or being declared due and payable prior to the date on which it would otherwise become due and payable; or


 




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vii. any
monetary judgment, writ or similar final process shall be entered or filed against the Company, any subsidiary or any of their
respective property or other assets for more than $100,000, and such judgment, writ or similar final process shall remain unvacated,
unbonded or unstayed for a period of 45 calendar days.


 


Notwithstanding
anything set forth herein to the contrary, an Event of Default is neither triggered nor accrues unless and until the Company receives
notice from holders of at least 67% in principal amount of the then outstanding Debentures declaring an Event of Default.


 


b) Remedies
Upon Event of Default. If any Event of Default occurs, the outstanding principal amount of this Debenture, plus accrued but
unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become,
at the Holder’s election, immediately due and payable in cash. Commencing 5 days after the occurrence of any Event of Default
that results in the eventual acceleration of this Debenture, the interest rate on this Debenture shall accrue at an interest rate
equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. In connection with such acceleration
described herein, the Holder need not provide, and the Company hereby waives, any presentment, demand, protest or other notice
of any kind, and the Holder may immediately and without expiration of any grace period enforce any and all of its rights and remedies
hereunder and all other remedies available to it under applicable law. Such acceleration may be rescinded and annulled by Holder
at any time prior to payment hereunder and the Holder shall have all rights as a holder of the Debenture until such time, if any,
as the Holder receives full payment pursuant to this Section 9(b). No such rescission or annulment shall affect any subsequent
Event of Default or impair any right consequent thereon.


 


Section
10. Miscellaneous


 


a) Notices.
Any and all notices or other communications or deliveries to be provided by the Holder hereunder, shall be in writing and delivered
personally, by facsimile, by email, or sent by a nationally recognized overnight courier service, addressed to the Company, at
the address set forth above, or such other facsimile number, email address, or address as the Company may specify for such purposes
by notice to the Holder delivered in accordance with this Section 10(a). Any and all notices or other communications or deliveries
to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile, by email, or sent by a nationally
recognized overnight courier service addressed to each Holder at the facsimile number, email address or address of the Holder
appearing on the books of the Company, or if no such facsimile number or email or address appears on the books of the Company,
at the principal place of business of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or
deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number or email to the email address set forth on the signature pages attached hereto
prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice
or communication is delivered via facsimile at the facsimile number or email to the email address set forth on the signature pages
attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the
second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (iv) upon
actual receipt by the party to whom such notice is required to be given.


 




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b) Absolute
Obligation. Except as expressly provided herein, no provision of this Debenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable,
on this Debenture at the time, place, and rate, and in the coin or currency, herein prescribed. This Debenture is a direct debt
obligation of the Company. This Debenture ranks pari passu with all other Debentures now or hereafter issued under the
terms set forth herein.


 


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


 


d) Governing
Law. All questions concerning the construction, validity, enforcement and interpretation of this Debenture shall be governed
by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles
of conflict of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense
of the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto or its respective
Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal courts sitting
in the City of New York, Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably
submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction
Documents), 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 such New York Courts, or such New York Courts are improper or inconvenient venue for
such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence
of delivery) to such party at the address in effect for notices to it under this Debenture and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to
the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating
to this Debenture or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any
provisions of this Debenture, then the prevailing party in such action or proceeding shall be reimbursed by the other party for
its attorney’s fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action
or proceeding.


 




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e) Waiver.
Any waiver by the Company or the Holder of a breach of any provision of this Debenture shall not operate as or be construed to
be a waiver of any other breach of such provision or of any breach of any other provision of this Debenture. The failure of the
Company or the Holder to insist upon strict adherence to any term of this Debenture on one or more occasions shall not be considered
a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this
Debenture on any other occasion. Any waiver by the Company or the Holder must be in writing.


 


f) Severability.
If any provision of this Debenture is invalid, illegal or unenforceable, the balance of this Debenture shall remain in effect,
and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons
and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable
law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of
interest permitted under applicable law. The Company covenants (to the extent that it may lawfully do so) that it shall not at
any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury
law or other law which would prohibit or forgive the Company from paying all or any portion of the principal of or interest on
this Debenture as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants
or the performance of this Debenture, and the Company (to the extent it may lawfully do so) hereby expressly waives all benefits
or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution
of any power herein granted to the Holder, but will suffer and permit the execution of every such as though no such law has been
enacted.


 


g) Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Debenture shall be cumulative
and in addition to all other remedies available under this Debenture 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 Debenture. 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 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 an injunction restraining any such breach or any such threatened breach, without the necessity of showing economic loss and
without any bond or other security being required. The Company shall provide all 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
Debenture.


 




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


 


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


 


j) Secured
Obligation. The obligations of the Company under this Debenture are secured by all assets of the Company and each Subsidiary
pursuant to the Security Agreement, dated as of April 1, 2020 between the Company, the Subsidiaries of the Company and the Secured
Parties (as defined therein).


 


k) No
Rights as Stockholder Until Conversion. This Debenture does not entitle the Holder to any voting rights, dividends or other
rights as a stockholder of the Company prior to the exercise hereof.


 


l) Authorized
Shares. The Company covenants that, during the period the Debenture is outstanding, it will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance of the Conversion Shares upon the exercise of
any conversion rights under this Debenture. The Company further covenants that its issuance of this Debenture shall constitute
full authority to its officers who are charged with the duty of issuing the necessary Conversion Shares upon the exercise of the
conversion rights under this Debenture. The Company will take all such reasonable action as may be necessary to assure that such
Conversion Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements
of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Conversion Shares which may be
issued upon the exercise of the conversion rights represented by this Debenture will, upon exercise of the conversion rights represented
by this Debenture in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes,
liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue). Except and to the extent as waived or consented to by the Holder, the Company shall not by
any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of
assets, consolidation, merger, 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 Debenture, but will at all times in good faith assist in the carrying
out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder
as set forth in this Debenture against impairment. Without limiting the generality of the foregoing, the Company will (i) not
increase the par value of any Conversion Shares above the Conversion Price immediately prior to such increase in par value, (ii)
take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and
nonassessable Conversion Shares upon the exercise of this Debenture and (iii) use commercially reasonable efforts to obtain all
such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary
to enable the Company to perform its obligations under this Debenture. Before taking any action which would result in an adjustment
in the number of Conversion Shares for which this Debenture is exercisable or in the Conversion Price, the Company shall obtain
all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies
having jurisdiction thereof.


 


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


 


(Signature
Pages Follow)


 




    	 21



    	 



    

 


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


 


	COMPANY:	 
	 	 
	AMERGENT
    HOSPITALITY GROUP, INC. 	 
	 	 
	By:	 	 
	 	Michael
    D. Pruitt, Chief Executive Officer	 


 


[SIGNATURE
PAGE TO DEBENTURE]


 




    	 



    	 



    

 


ATTACHMENT
A


 


NOTICE
OF CONVERSION


 


The
undersigned hereby elects to convert amounts outstanding under the 10% Secured Convertible Debenture of Amergent Hospitality Group,
Inc., a Delaware corporation (the “Company”), into shares of common stock (the “Common Stock”),
of the Company according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in
the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and
is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will
be charged to the Holders for any conversion, except for such transfer taxes, if any.


 


Date
to Effect Conversion:         _______________________________________


(if
not date is set, conversion date shall be the date this notice is received)


 


Amount
of Debenture to be Converted: $________________________


 


	 	Signature:	 
	 	Name:	 
	 	Address:	 



 



    	 22



    	 



    

 


EXHIBIT
B


 


ASSIGNMENT
FORM


 


(To
assign the foregoing Debenture, execute this form and supply required information. Do not use this form to purchase shares.)


 


FOR
VALUE RECEIVED, the foregoing Debenture and all rights evidenced thereby are hereby assigned to


 


	Name:	 	 
	 	 	(Please Print)
	 	 	 
	Address:	 	 
	 	 	(Please Print)
	 	 	 
	Phone Number:	 	 
	 	 	 
	Email Address:	 	 


 


Dated:


___________________________,


________


 


	Holder’s
    Signature: 	 	 
	 	 	 
	Address:		 


 




    	 23



    	 



    

 


Exhibit
B


 


REGISTRATION
RIGHTS AGREEMENT


 


This
REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made as of April 1, 2020 by and among Amergent Hospitality
Group, Inc. a Delaware corporation (the “Company”), each of parties on the signature page hereto. Each
of the parties on the signature page hereto, including Arena (as defined below) and any person or entity who hereafter becomes
a party to this Agreement pursuant to Section 5.02 of this Agreement, is herein referred to as a “Holder”
and collectively as the “Holders”.


 


RECITALS


 


WHEREAS,
this Agreement is made and entered into in connection with the closing of the transactions (the “Transactions”)
contemplated by the Securities Purchase Agreement (the “Purchase Agreement”) dated as of the date hereof
among Chanticleer Holdings, Inc., a Delaware corporation (“Chanticleer”), the Company and each of the
Holders;


 


WHEREAS,
pursuant to the terms of the Purchase Agreement, the Company issued warrants (the “Warrants”) to purchase
shares of Common Stock and 10% Senior Convertible Debentures (the “Debentures”) that are convertible
into shares of Common Stock;


 


WHEREAS,
the Company has issued Convertible Preferred Stock (“Preferred Stock”) to Arena Investors, LP (“Arena”)
that is convertible into shares of Common Stock;


 


WHEREAS,
the Company and the Holders desire to enter into this Agreement, pursuant to which the Company shall grant the Holders certain
registration rights with respect to certain securities of the Company, as set forth in this Agreement.


 


NOW,
THEREFORE, in consideration of the representations, covenants and agreements contained herein, and certain other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally
bound, hereby agree as follows:


 


ARTICLE
I. DEFINITIONS


 


Section
1.01 Definitions. The terms defined in this Article I shall, for all purposes of this Agreement, have the respective
meanings set forth below:


 


“Adverse
Disclosure” shall mean any public disclosure of material non-public information, which disclosure, in the good faith
judgment of the Chief Executive Officer or principal financial officer of the Company, after consultation with counsel to the
Company, (i) would be required to be made in any Registration Statement or Prospectus in order for the applicable Registration
Statement or Prospectus not to contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements contained therein (in the case of any prospectus and any preliminary prospectus, in the light of the circumstances
under which they were made) not misleading, (ii) would not be required to be made at such time if the Registration Statement were
not being filed, and (iii) the Company has a bona fide business purpose for not making such information public.


 




    	 



    	 



    

 


“Agreement”
shall have the meaning given in the Preamble. “Blackout Period” shall have the meaning given in Section
3.04(b).


 


“Business
Day” shall mean any day of the year on which national banking institutions in New York are open to the public for
conducting business and are not required or authorized to close.


 


“Common
Stock” shall mean the Common Stock, par value $0.0001 per share, of the Company.


 


“Commission”
shall mean the Securities and Exchange Commission. “Company” shall have the meaning given in the Preamble.


“Demanding
Holder” and “Demanding Holders” shall have the meaning given in Section 2.02(a).


 


“Exchange
Act” shall mean the Securities Exchange Act of 1934, as it may be amended from time to time.


 


“Holders”
shall have the meaning given in the Preamble.


 


“Maximum
Number of Securities” shall have the meaning given in Section 2.02(b). “Minimum Amount”
shall have the meaning given in Section 2.02(a).


 


“Misstatement”
shall mean an untrue statement of a material fact or an omission to state a material fact required to be stated in a Registration
Statement or Prospectus, or necessary to make the statements in a Registration Statement or Prospectus in the light of the circumstances
under which they were made not misleading.


 


“Piggyback
Registration” shall have the meaning given in Section 2.03.


 


“Prospectus”
shall mean the prospectus included in any Registration Statement, as supplemented by any and all prospectus supplements and as
amended by any and all post-effective amendments and including all material incorporated by reference in such prospectus.


 


“Registrable
Security” shall mean (a) any shares of Common Stock issued by the Company (i) upon exercise of the Warrants, (ii)
upon conversion of the Debentures, or (iii) upon conversion of the Preferred Stock and (b) any other equity security of the Company
issued or issuable with respect to any such share of Common Stock by way of a stock dividend or stock split or in connection with
a combination of shares, recapitalization, merger, consolidation or reorganization; provided, however, that, as
to any particular Registrable Security, such securities shall cease to be Registrable Securities when: (A) a Registration Statement
with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have
been sold, transferred, disposed of or exchanged in accordance with such Registration Statement; (B) such securities shall have
been otherwise transferred, new certificates for such securities not bearing a legend restricting further transfer shall have
been delivered by the Company and subsequent public distribution of such securities shall not require registration under the Securities
Act; (C) such securities shall have ceased to be outstanding; (D) such securities may be sold without registration pursuant to
Rule 144 promulgated under the Securities Act (or any successor rule promulgated thereafter by the Commission) (but with no volume
or other restrictions or limitations); or (E) such securities have been sold to, or through, a broker, dealer or underwriter in
a public distribution or other public securities transaction.


 




    	2 



    	 



    

 





“Registration”
shall mean a registration effected by preparing and filing a registration statement or similar document in compliance with the
requirements of the Securities Act, and the applicable rules and regulations promulgated thereunder, and such registration statement
becoming effective.


 


“Registration
Expenses” shall mean the out-of-pocket expenses of a Registration, including, without limitation, the following:


 


		(A)	all
                                         registration and filing fees (including fees with respect to filings required to be made
                                         with the Financial Industry Regulatory Authority, Inc.) and any securities exchange on
                                         which the Common Stock is then listed;
	 	 	 
		(B)	fees
                                         and expenses of compliance with securities or blue sky laws (including reasonable fees
                                         and disbursements of counsel for the Underwriters in connection with blue sky qualifications
                                         of Registrable Securities);
	 	 	 
		(C)	printing,
                                         messenger, telephone and delivery expenses;
	 	 	 
		(D)	reasonable
                                         fees and disbursements of counsel for the Company;
	 	 	 
		(E)	reasonable
                                         fees and disbursements of all independent registered public accountants of the Company
                                         incurred specifically in connection with such Registration (including the expenses of
                                         any special audit and “comfort letters” required by or incident to such performance);
                                         and
	 	 	 
		(F)	reasonable
                                         fees and expenses of one (1) legal counsel selected by the Demanding Holders in connection
                                         with an Underwritten Offering.



 


“Registration
Statement” shall mean any registration statement that covers the Registrable Securities pursuant to the provisions
of this Agreement, including the Prospectus included in such registration statement, amendments (including post-effective amendments)
and supplements to such registration statement, and all exhibits to and all material incorporated by reference in such registration
statement.


 


“Securities
Act” shall mean the Securities Act of 1933, as amended from time to time.


 




    	3 



    	 



    

 


“Suspension
Period” shall have the meaning given in Section 3.04(a). “Transactions” shall have
the meaning given in the Recitals.


 


“Underwriter”
shall mean a securities dealer who purchases any Registrable Securities as principal in an Underwritten Offering and not as part
of such dealer’s market-making activities.


 


“Underwritten
Offering” shall mean an offering in which securities of the Company are sold to an Underwriter in a firm commitment
underwriting for distribution to the public.


 


“Underwritten
Offerings Cap” shall have the meaning set forth in Section 2.02(a).


 


ARTICLE
II. REGISTRATIONS


 


Section
2.01 Registration Statement. The Company shall, as soon as practicable after the date hereof, file a Registration Statement
under the Securities Act to permit the public resale of all the Registrable Securities held by the Holders from time to time as
permitted by Rule 415 under the Securities Act (or any successor or similar provision adopted by the Commission then in effect)
on the terms and conditions specified in this Section 2.01 and shall use its commercially reasonable efforts to cause such
Registration Statement to be declared effective as soon as practicable after the filing thereof. The Registration Statement filed
with the Commission pursuant to this Section 2.01 shall be on Form S-1 or such other form of registration statement as
is then available to effect a registration for resale of such Registrable Securities, covering such Registrable Securities, and
shall contain a Prospectus in such form as to permit any Holder to sell such Registrable Securities pursuant to Rule 415 under
the Securities Act (or any successor or similar provision adopted by the Commission then in effect) at any time beginning on the
effective date for such Registration Statement. A Registration Statement filed pursuant to this Section 2.01 shall provide
for the resale pursuant to any method or combination of methods legally available to, and requested by, the Holders. The Company
shall use its reasonable best efforts to cause a Registration Statement filed pursuant to this Section 2.01 to remain effective,
and to be supplemented and amended to the extent necessary to ensure that such Registration Statement is available or, if not
available, that another registration statement is available, for the resale of all the Registrable Securities held by the Holders
until all such Registrable Securities have ceased to be Registrable Securities. As soon as practicable following the effective
date of a Registration Statement filed pursuant to this Section 2.01, but in any event within three (3) Business Days of
such date, the Company shall notify the Holders of the effectiveness of such Registration Statement. When effective, a Registration
Statement filed pursuant to this Section 2.01 (including any documents incorporated therein by reference) will comply as
to form in all material respects with all applicable requirements of the Securities Act and the Exchange Act and will not contain
an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the
statements therein not misleading (in the case of any Prospectus contained in such Registration Statement, in the light of the
circumstances under which such statement is made).


 




    	4 



    	 



    

 


Section
2.02 Underwritten Offering.


 


(a) In
the event that Holders elect to dispose of Registrable Securities under a Registration Statement pursuant to an Underwritten Offering
of all or part of such Registrable Securities that are registered by such Registration Statement and reasonably expect aggregate
gross proceeds in excess of $2,000,000 (the “Minimum Amount”) from such Underwritten Offering, then
the Company shall, upon the written demand from the Holders (any such Holder, a “Demanding Holder” and,
collectively, the “Demanding Holders”), enter into an underwriting agreement in a form as is customary
in Underwritten Offerings of equity securities with the managing Underwriter or Underwriters selected by the Company after consultation
with the Demanding Holders and shall take all such other reasonable actions as are requested by the managing Underwriter or Underwriters
in order to expedite or facilitate the disposition of such Registrable Securities; provided, however, that the Company
shall have no obligation to facilitate or participate in more than four (4) Underwritten Offerings from Oz Rey, LLC and three
(3) Underwritten Offerings from Holders other than Oz Rey, LLC pursuant to this Section 2.02 for all Holders (the “Underwritten
Offerings Cap”); provided further that if an Underwritten Offering is commenced but terminated prior to the
pricing thereof for any reason, such Underwritten Offering will not be counted as an Underwritten Offering pursuant to this Section
2.02. In addition, the Company shall give prompt written notice to each other Holder regarding such proposed Underwritten
Offering, and such notice shall offer such Holders the opportunity to include in the Underwritten Offering such number of Registrable
Securities as each such Holder may request. Each such Holder shall make such request in writing to the Company within five (5)
business days after the receipt of any such notice from the Company, which request shall specify the number of Registrable Securities
intended to be disposed of by such Holder. In connection with any Underwritten Offering contemplated by this Section 2.02,
the underwriting agreement into which each Demanding Holder and the Company shall enter shall contain such representations, covenants,
indemnities (subject to Article IV) and other rights and obligations as are customary in underwritten offerings of equity
securities. No Demanding Holder shall be required to make any representations or warranties to or agreements with the Company
or the Underwriters other than representations, warranties or agreements regarding such Demanding Holder’s authority to
enter into such underwriting agreement and to sell, and its ownership of, the securities being registered on its behalf, its intended
method of distribution and any other representation required by law.


 


(b) If
the managing Underwriter or Underwriters in an Underwritten Offering, in good faith, advises the Company and the Demanding Holders
that the dollar amount or number of Registrable Securities that the Demanding Holders desire to sell, taken together with all
other shares of Common Stock or other equity securities that the Company or any other Holder desires to sell and the shares of
Common Stock, if any, as to which a Registration has been requested pursuant to separate written contractual piggy-back registration
rights held by any other stockholders who desire to sell, exceeds the maximum dollar amount or maximum number of equity securities
that can be sold in the Underwritten Offering without adversely affecting the proposed offering price, the timing, the distribution
method, or the probability of success of such offering (such maximum dollar amount or maximum number of such securities, as applicable,
the “Maximum Number of Securities”), then the Company shall include in such Underwritten Offering, as
follows:


 


(i) first,
the Registrable Securities of the Demanding Holders pro rata based on the respective number of Registrable Securities that each
Demanding Holder has requested be included in such Underwritten Offering and the aggregate number of Registrable Securities that
the Demanding Holders have requested be included in such Underwritten Offering that can be sold without exceeding the Maximum
Number of Securities;


 




    	5 



    	 



    

 


(ii) second,
to the extent that the Maximum Number of Securities has not been reached under the foregoing clause (i), shares of Common
Stock or other equity securities that the Company desires to sell, which can be sold without exceeding the Maximum Number of Securities;
and


 


(iii) third,
to the extent that the Maximum Number of Securities has not been reached under the foregoing clause (i) and clause (ii),
shares of Common Stock or other equity securities of (x) other Holders who have elected to participate in the Underwritten Offering
pursuant to Section 2.02(a) or (y) persons or entities that the Company is obligated to register in a Registration pursuant
to separate written contractual arrangements with such persons, pro rata, which can be sold without exceeding the Maximum Number
of Securities.


 


(c) A
Demanding Holder shall have the right to withdraw all or any portion of its Registrable Securities included in an Underwritten
Offering pursuant to this Section 2.02 for any or no reason whatsoever upon written notification to the Company and the
Underwriter or Underwriters of its intention to withdraw from such Underwritten Offering prior to the pricing of such Underwritten
Offering and such withdrawn amount shall no longer be considered an Underwritten Offering (including, without limitation, for
purposes of the Underwritten Offerings Cap); provided, however, that upon the withdrawal of an amount of Registrable
Securities that results in the remaining amount of Registrable Securities included by Holders in such Underwritten Offering being
less than the Minimum Amount, the Company shall cease all efforts to complete the Underwritten Offering and, for the avoidance
of doubt, such Underwritten Offering shall not count against the Underwritten Offerings Cap. Notwithstanding anything to the contrary
in this Agreement, the Company shall be responsible for the Registration Expenses incurred in connection with an Underwritten
Offering prior to its withdrawal under this Section 2.02(c).


 


Section
2.03 Piggyback Registration.


 


(a) If
at any time the Company proposes to file a Registration Statement under the Securities Act with respect to an Underwritten Offering
of equity securities, or securities or other obligations exercisable or exchangeable for, or convertible into equity securities,
for its own account or for the account of stockholders of the Company (or by the Company and by the stockholders of the Company
including, without limitation, pursuant to Section 2.02 hereof) on a form that would permit registration of Registrable
Securities, other than a Registration Statement (i) filed in connection with any employee stock option or other benefit plan,
(ii) for an exchange offer or offering of securities solely to the Company’s existing stockholders, (iii) for an offering
of debt that is convertible into equity securities of the Company, (iv) for a dividend reinvestment plan or (v) on Form S-4, then
the Company shall give written notice of such proposed filing to all of the Holders of Registrable Securities as soon as practicable
but not less than ten (10) days before the anticipated filing date of such Registration Statement, which notice shall (A) describe
the amount and type of securities to be included in such offering, the intended method(s) of distribution, and the name of the
proposed managing Underwriter or Underwriters, if any, in such offering, and (B) offer to all of the Holders of Registrable Securities
the opportunity to register the sale of such number of Registrable Securities as such Holders may request in writing within five
(5) days after receipt of such written notice (in the case of an “overnight” or “bought” offering, such
requests must be made by the Holders within one (1) Business Day after the delivery of any such notice by the Company) (such Registration
a “Piggyback Registration”); provided, however, that if the Company has been advised by the managing
Underwriter(s) that the inclusion of Registrable Securities for sale for the benefit of the Holders will have an adverse effect
on the price, timing or distribution of the Common Stock in the Underwritten Offering, then (A) if no Registrable Securities can
be included in the Underwritten Offering in the opinion of the managing Underwriter(s), the Company shall not be required to offer
such opportunity to the Holders or (B) if any Registrable Securities can be included in the Underwritten Offering in the opinion
of the managing Underwriter(s), then the amount of Registrable Securities to be offered for the accounts of Holders shall be determined
based on the provisions of Section 2.03(b). Subject to Section 2.03(b), the Company shall, in good faith, cause
such Registrable Securities to be included in such Piggyback Registration and shall use its commercially reasonable efforts to
cause the managing Underwriter or Underwriters of a proposed Underwritten Offering to permit the Registrable Securities requested
by the Holders pursuant to this Section 2.03 to be included in a Piggyback Registration on the same terms and conditions
as any similar securities of the Company included in such Registration and to permit the sale or other disposition of such Registrable
Securities in accordance with the intended method(s) of distribution thereof. If no written request for inclusion from a Holder
is received within the specified time, each such Holder shall have no further right to participate in such Underwritten Offering.
All such Holders proposing to distribute their Registrable Securities through an Underwritten Offering under this Section 2.03
shall enter into an underwriting agreement in customary form with the Underwriter(s) selected for such Underwritten Offering
by the Company.


 




    	6 



    	 



    

 


(b) If
the managing Underwriter or Underwriters in an Underwritten Offering that is to be a Piggyback Registration, in good faith, advises
the Company and the Holders of Registrable Securities participating in the Piggyback Registration that the dollar amount or number
of shares of Common Stock that the Company desires to sell, taken together with (i) the shares of Common Stock, if any, as to
which Registration has been demanded pursuant to separate written contractual arrangements with persons or entities other than
the Holders of Registrable Securities hereunder, (ii) the Registrable Securities as to which registration has been requested pursuant
to Sections 2.02 and 2.03, and (iii) the shares of Common Stock, if any, as to which Registration has been requested pursuant
to separate written contractual piggy-back registration rights of other stockholders of the Company, exceeds the Maximum Number
of Securities, then:


 


(i) If
the Registration is undertaken for the Company’s account, the Company shall include in any such Registration (A) first,
shares of Common Stock or other equity securities that the Company desires to sell, which can be sold without exceeding the Maximum
Number of Securities; (B) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing
clause (A), pro rata to the Registrable Securities of Holders exercising their rights to register their Registrable Securities
pursuant to Sections 2.02 and 2.03 hereof which can be sold without exceeding the Maximum Number of Securities;
and (C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A)
and (B), shares of Common Stock, if any, as to which Registration has been requested pursuant to written contractual piggy-back
registration rights of other stockholders of the Company, which can be sold without exceeding the Maximum Number of Securities;


 




    	7 



    	 



    

 


(ii) If
the Registration is pursuant to a request by persons or entities other than the Holders of Registrable Securities, then the Company
shall include in any such Registration (A) first, shares of Common Stock or other equity securities, if any, of such requesting
persons or entities, other than the Holders of Registrable Securities, which can be sold without exceeding the Maximum Number
of Securities; (B) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing
clause (A), pro rata to the Registrable Securities of Holders exercising their rights to register their Registrable Securities
pursuant to Sections 2.02 and 2.03 hereof which can be sold without exceeding the Maximum Number of Securities;
(C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A) and
(B), shares of Common Stock or other equity securities that the Company desires to sell, which can be sold without exceeding the
Maximum Number of Securities; and (D) fourth, to the extent that the Maximum Number of Securities has not been reached
under the foregoing clauses (A), (B) and (C), shares of Common Stock or other equity securities for the account of other persons
or entities that the Company is obligated to register pursuant to separate written contractual arrangements with such persons
or entities, which can be sold without exceeding the Maximum Number of Securities.


 


(c) Any
Holder of Registrable Securities shall have the right to withdraw from a Piggyback Registration for any or no reason whatsoever
upon written notification to the Company and the Underwriter or Underwriters (if any) of its intention to withdraw from such Piggyback
Registration prior to the pricing of such Underwritten Offering. The Company (whether on its own good faith determination or as
the result of a request for withdrawal by persons pursuant to separate written contractual obligations) may withdraw a Registration
Statement filed with the Commission in connection with a Piggyback Registration at any time prior to the effectiveness of such
Registration Statement. Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for the Registration
Expenses incurred in connection with the Piggyback Registration prior to its withdrawal under this Section 2.03.


 


(d) For
purposes of clarity, any Registration effected pursuant to Section 2.03 hereof shall not be counted as a Registration effected
under Section 2.02 hereof.


 


ARTICLE
III.


COMPANY
PROCEDURES


 


Section
3.01 General Procedures. The Company shall use its commercially reasonable efforts to effect the Registration of Registrable
Securities in accordance with the intended plan of distribution thereof, and pursuant thereto the Company shall, as expeditiously
as practicable:


 


(a) subject
to Section 2.01, prepare and file with the Commission a Registration Statement with respect to such Registrable Securities
and use its commercially reasonable efforts to cause such Registration Statement to become effective and remain effective pursuant
to the terms of this Agreement until all of such Registrable Shares have been disposed of (if earlier);


 


(b) prepare
and file with the Commission such amendments and post-effective amendments to the Registration Statement, and such supplements
to the Prospectus, as may be required by the rules, regulations or instructions applicable to the registration form used by the
Company or by the Securities Act or rules and regulations thereunder to keep the Registration Statement effective until all of
such Registrable Shares have been disposed of (if earlier) in accordance with the intended plan of distribution set forth in such
Registration Statement or supplement to the Prospectus;


 




    	8 



    	 



    

 


(c) prior
to filing a Registration Statement or Prospectus, or any amendment or supplement thereto, furnish without charge to the Underwriters,
if any, and the Holders of Registrable Securities included in such Registration, and to one legal counsel selected by the Holders,
copies of such Registration Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in
each case including all exhibits thereto and documents incorporated by reference therein), the Prospectus included in such Registration
Statement (including each preliminary Prospectus), and such other documents as the Underwriters and the Holders of Registrable
Securities included in such Registration or the legal counsel selected by such Holders may request in order to facilitate the
disposition of the Registrable Securities owned by such Holders;


 


(d) prior
to any public offering of Registrable Securities, use its commercially reasonable efforts to (i) register or qualify the Registrable
Securities covered by the Registration Statement under such securities or “blue sky” laws of such jurisdictions in
the United States as the Holders of Registrable Securities included in such Registration Statement (in light of their intended
plan of distribution) may request and (ii) take such action necessary to cause such Registrable Securities covered by the Registration
Statement to be registered with or approved by such other governmental authorities as may be necessary by virtue of the business
and operations of the Company and do any and all other acts and things that may be necessary or advisable to enable the Holders
of Registrable Securities included in such Registration Statement to consummate the disposition of such Registrable Securities
in such jurisdictions; provided, however, that the Company shall not be required to qualify generally to do business
or as a dealer in securities in any jurisdiction where it would not otherwise be required to qualify or take any action to which
it would be subject to general service of process or taxation in any such jurisdiction where it is not then otherwise so subject;


 


(e) use
its commercially reasonable efforts to cause all such Registrable Securities to be listed on each securities exchange or automated
quotation system on which similar securities issued by the Company are then listed;


 


(f) provide
a transfer agent and registrar for all such Registrable Securities no later than the effective date of such Registration Statement;


 


(g) advise
each seller of such Registrable Securities, promptly after it shall receive notice or obtain knowledge thereof, of the issuance
of any stop order by the Commission suspending the effectiveness of such Registration Statement or the initiation or threatening
of any proceeding for such purpose and promptly use its commercially reasonable efforts to prevent the issuance of any stop order
or to obtain its withdrawal if such stop order should be issued;


 


(h) at
least five (5) days prior to the filing of any Registration Statement or Prospectus or any amendment or supplement to such Registration
Statement or Prospectus or any document that is to be incorporated by reference into such Registration Statement or Prospectus,
furnish a copy thereof to each seller of such Registrable Securities or its counsel;


 


(i) notify
the Holders at any time when a Prospectus relating to such Registration Statement is required to be delivered under the Securities
Act, of the happening of any event as a result of which the Prospectus included in such Registration Statement, as then in effect,
includes a Misstatement, and then to correct such Misstatement as set forth in Section 3.04 hereof;


 




    	9 



    	 



    

 


(j) permit
a representative of the Holders, the Underwriters, if any, and any attorney or accountant retained by such Holders or Underwriter
to participate, at each such person’s own expense, in the preparation of the Registration Statement, and cause the Company’s
officers, directors and employees to supply all information reasonably requested by any such representative, Underwriter, attorney
or accountant in connection with the Registration; provided, however, that such representatives or Underwriters
enter into a confidentiality agreement, in form and substance reasonably satisfactory to the Company, prior to the release or
disclosure of any such information;


 


(k) obtain
a “cold comfort” letter from the Company’s independent registered public accountants in the event of an Underwritten
Offering, in customary form and covering such matters of the type customarily covered by “cold comfort” letters as
the managing Underwriter may reasonably request;


 


(l) on
the date the Registrable Securities are delivered for sale pursuant to such Registration, obtain an opinion, dated as of such
date, of counsel representing the Company for the purposes of such Registration, addressed to the placement agent or sales agent,
if any, and the Underwriters, if any, covering such legal matters with respect to the Registration in respect of which such opinion
is being given as are customarily included in such opinions and negative assurance letters;


 


(m) in
the event of any Underwritten Offering, enter into and perform its obligations under an underwriting agreement, on terms agreed
to by the Company with the managing Underwriter of such offering;


 


(n) make
available to its security holders, as soon as reasonably practicable, an earnings statement (which need not be audited) covering
the period of at least twelve (12) months beginning with the first day of the Company’s first full calendar quarter after
the effective date of the Registration Statement which satisfies the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder (or any successor rule promulgated thereafter by the Commission);


 


(o) if
any Underwritten Offering involves the disposition of Registrable Securities involving gross proceeds in excess of the Minimum
Amount, use its reasonable efforts to make available senior executives of the Company to participate in customary “road
show” presentations that may be reasonably requested by the Underwriter in such Underwritten Offering; and


 


(p) otherwise,
in good faith, take such customary actions necessary to effect the registration of such Registrable Shares contemplated hereby.


 


Section
3.02 Registration Expenses. The Registration Expenses of all Registrations shall be borne by the Company. It is acknowledged
by the Holders and the Company that the Holders shall bear all incremental selling expenses relating to the sale of Registrable
Securities, such as Underwriters’ commissions and discounts, brokerage fees and, other than as set forth in the definition
of “Registration Expenses,” all reasonable fees and expenses of any legal counsel representing the Holders.


 


Section
3.03 Requirements for Participation in Underwritten Offerings. No person may participate in any Underwritten Offering for
equity securities of the Company hereunder unless such person (i) agrees to sell such person’s securities on the basis provided
in the underwriting agreement for such Underwritten Offering and (ii) completes and executes all customary questionnaires, powers
of attorney, indemnities, lock-up agreements, underwriting agreements and other customary documents as may be reasonably required
under the terms of such underwriting agreement.


 




    	10 



    	 



    

 


Section
3.04 Suspension of Sales; Adverse Disclosure.


 


(a) Upon
receipt of written notice from the Company that a Registration Statement or Prospectus contains a Misstatement or that a Registration
Statement has ceased to be in compliance with the rules of the Commission, each of the Holders shall forthwith discontinue disposition
of Registrable Securities until it has received copies of a supplemented or amended Prospectus correcting the Misstatement or
noncompliance (it being understood that the Company hereby covenants to prepare and file such supplement or amendment as soon
as practicable after the time of such notice), or until it is advised in writing by the Company that the use of the Prospectus
may be resumed (any such period, a “Suspension Period”).


 


(b) If
the filing, initial effectiveness or continued use of a Registration Statement in respect of any Registration (including in connection
with an Underwritten Offering) at any time would require the Company to make an Adverse Disclosure or would require the inclusion
in such Registration Statement of financial statements that are unavailable to the Company for reasons beyond the Company’s
control, then the Company may, upon giving prompt written notice to the Holders, delay the filing or initial effectiveness of,
or suspend use of, such Registration Statement (including in connection with an Underwritten Offering) for the shortest period
of time, but in no event more than thirty (30) days, determined in good faith by the Company to be necessary for such purpose
(any such period, a “Blackout Period”). In the event the Company exercises its rights under the preceding
sentence, the Holders agree to suspend, immediately upon their receipt of the notice referred to above, their use of the Prospectus
relating to any Registration in connection with any sale or offer to sell Registrable Securities.


 


(c) The
Company shall immediately notify the Holders of the expiration of any period during which it exercised its rights under this Section
3.04. Notwithstanding anything to the contrary in this Section 3.04, in no event shall any Suspension Period or any
Blackout Period continue for more than ninety (90) days in the aggregate during any 365-day period.


 


Section
3.05 Reporting Obligations. As long as any Holder shall own Registrable Securities, the Company, at all times while it shall
be a reporting company under the Exchange Act, covenants to file timely (or obtain extensions in respect thereof and file within
the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to Sections 13(a)
or 15(d) of the Exchange Act and to promptly furnish the Holders with true and complete copies of all such filings (the delivery
of which will be satisfied by the Company’s filing of such reports on the Commission’s EDGAR system). The Company
further covenants that it shall take such further action as any Holder may reasonably request, all to the extent required from
time to time to enable such Holder to sell shares of Common Stock held by such Holder without registration under the Securities
Act within the limitation of the exemptions provided by Rule 144 promulgated under the Securities Act (or any successor rule promulgated
thereafter by the Commission), including providing any legal opinions. Upon the request of any Holder, the Company shall deliver
to such Holder a written certification of a duly authorized officer as to whether it has complied with such requirements.


 




    	11 



    	 



    

 


ARTICLE
IV. 

INDEMNIFICATION AND CONTRIBUTION


 


Section
4.01 Indemnification.


 


(a) The
Company agrees to indemnify, to the extent permitted by law, each Holder of Registrable Securities, its officers and directors
and each person who controls such Holder (within the meaning of the Securities Act) against all losses, claims, damages, liabilities
and expenses (including attorneys’ fees) caused by any untrue or alleged untrue statement of material fact contained in
any Registration Statement, Prospectus or preliminary Prospectus or any amendment thereof or supplement thereto or any omission
or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading,
except insofar as the same are caused by or contained in any information furnished in writing to the Company by such Holder expressly
for use therein. The Company shall indemnify the Underwriters, their officers and directors and each person who controls such
Underwriters (within the meaning of the Securities Act) to the same extent as provided in the foregoing with respect to the indemnification
of the Holder.


 


(b) In
connection with any Registration Statement in which a Holder of Registrable Securities is participating, such Holder shall furnish
to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with any such
Registration Statement or Prospectus and, to the extent permitted by law, shall indemnify the Company, its directors and officers
and agents and each person who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages,
liabilities and expenses (including without limitation reasonable attorneys’ fees) resulting from any untrue statement of
material fact contained in the Registration Statement, Prospectus or preliminary Prospectus or any amendment thereof or supplement
thereto or any omission of a material fact required to be stated therein or necessary to make the statements therein not misleading,
but only to the extent that such untrue statement or omission is contained in any information or affidavit so furnished in writing
by such Holder expressly for use therein; provided, however, that the obligation to indemnify shall be several,
not joint and several, among such Holders of Registrable Securities, and the liability of each such Holder of Registrable Securities
shall be in proportion to and limited to the net proceeds received by such Holder from the sale of Registrable Securities pursuant
to such Registration Statement. The Holders of Registrable Securities shall indemnify the Underwriters, their officers, directors
and each person who controls such Underwriters (within the meaning of the Securities Act) to the same extent as provided in the
foregoing with respect to indemnification of the Company.


 


(c) Any
person entitled to indemnification herein shall (i) give prompt written notice to the indemnifying party of any claim with respect
to which it seeks indemnification (provided that the failure to give prompt notice shall not impair any person’s right to
indemnification hereunder to the extent such failure has not materially prejudiced the indemnifying party) and (ii) unless in
such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may
exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory
to the indemnified party. If such defense is assumed, the indemnifying party shall not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent shall not be unreasonably withheld). An indemnifying party
who is not entitled to, or elects not to, assume the defense of a claim shall not be obligated to pay the fees and expenses of
more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable
judgment of any indemnified party a conflict of interest may exist between such indemnified party and any other of such indemnified
parties with respect to such claim. No indemnifying party shall, without the consent of the indemnified party, consent to the
entry of any judgment or enter into any settlement which cannot be settled in all respects by the payment of money (and such money
is so paid by the indemnifying party pursuant to the terms of such settlement) or which settlement does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such
claim or litigation.


 




    	12 



    	 



    

 


(d) The
indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by
or on behalf of the indemnified party or any officer, director or controlling person of such indemnified party and shall survive
the transfer of securities. The Company and each Holder of Registrable Securities participating in an offering also agrees to
make such provisions as are reasonably requested by any indemnified party for contribution to such party in the event the Company’s
or such Holder’s indemnification is unavailable for any reason.


 


(e) If
the indemnification provided under this Section 4.01 from the indemnifying party is unavailable or insufficient to hold
harmless an indemnified party in respect of any losses, claims, damages, liabilities and expenses referred to herein, then the
indemnifying party, in lieu of indemnifying the indemnified party, shall contribute to the amount paid or payable by the indemnified
party as a result of such losses, claims, damages, liabilities and expenses in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and the indemnified party, as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and indemnified party shall be determined by reference to, among other things, whether
any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to
state a material fact, was made by, or relates to information supplied by, such indemnifying party or indemnified party, and the
indemnifying party’s and indemnified party’s relative intent, knowledge, access to information and opportunity to
correct or prevent such action; provided, however, that the liability of any Holder under this Section 4.01(e)
shall be limited to the amount of the net proceeds received by such Holder in such offering giving rise to such liability.
The amount paid or payable by a party as a result of the losses or other liabilities referred to above shall be deemed to include,
subject to the limitations set forth in Section 4.01(a), Section 4.01(b) and Section 4.01(c) above, any legal
or other fees, charges or expenses reasonably incurred by such party in connection with any investigation or proceeding. The parties
hereto agree that it would not be just and equitable if contribution pursuant to this Section 4.01(e) were determined by
pro rata allocation or by any other method of allocation, which does not take account of the equitable considerations referred
to in this Section 4.01(e). No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution pursuant to this Section 4.01(e) from any person who was not guilty of
such fraudulent misrepresentation.


 




    	13 



    	 



    

 


ARTICLE
V. 

MISCELLANEOUS


 


Section
5.01 Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall
be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number or email as set forth on the signature pages attached hereto at or prior to
5:30 p.m. (New York City time) on a trading day, (b) the next trading day after the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number or email as set forth on the signature pages attached hereto on a day that
is not a trading day or later than 5:30 p.m. (New York City time) on any trading day, (c) the fifth (5th) trading day following
the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to
whom such notice is required to be given. The address for such notices and communications shall be as set forth on the signature
pages attached hereto. Any party may change its address for notice at any time and from time to time by written notice to the
other parties hereto, and such change of address shall become effective upon receipt of such notice as provided in this Section
5.01.


 


Section
5.02 Assignment; No Third Party Beneficiaries.


 


(a) This
Agreement and the rights, duties and obligations of the Company hereunder may not be assigned or delegated by the Company in whole
or in part.


 


(b) This
Agreement and the provisions hereof shall be binding upon and shall inure to the benefit of each of the parties and its successors
and the permitted assigns of the Holders.


 


(c) This
Agreement shall not confer any rights or benefits on any persons that are not parties hereto, other than as expressly set forth
in this Agreement and this Section 5.02.


 


(d) No
assignment by any party hereto of such party’s rights, duties and obligations hereunder shall be binding upon or obligate
the Company unless and until the Company shall have received (i) written notice of such assignment as provided in Section 5.01
and (ii) the written agreement of the assignee, in a form reasonably satisfactory to the Company, to be bound by the terms
and provisions of this Agreement (which may be accomplished by an addendum or certificate of joinder to this Agreement). Any transfer
or assignment made other than as provided in this Section 5.02 shall be null and void.


 


Section
5.03 Counterparts. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other
party, it being understood that the parties need not sign the same counterpart. This Agreement may be executed and delivered in
original, via DocuSign, RightSignature or any other comparable signature software, via facsimile or email with PDF attachment,
or other commercially acceptable electronic form, in any number of counterparts, each of which shall be deemed an original, and
all of which shall together constitute but one and the same instrument, which instrument shall for all purposes be sufficiently
evidenced by any such counterpart.


 


Section
5.04 Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement
shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard
to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement
and defense of the transactions contemplated by this Agreement (whether brought against a party hereto or its respective affiliates,
directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal
courts sitting in the City of New York. Each party 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 (including with respect to the enforcement of any of this Agreement),
and hereby irrevocably waives, and agrees not to assert in any action or proceeding, any claim that it is not personally subject
to the jurisdiction of any such court, that such action or proceeding is improper or is an inconvenient venue for such proceeding.
Each party hereby irrevocably waives personal service of process and consents to process being served in any such action or proceeding
by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at
the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any other manner permitted by law. If any party hereto shall commence an action or proceeding to enforce any provisions of
this Agreement, then the prevailing party in such action or proceeding shall be reimbursed by the non-prevailing party for its
reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of
such action or proceeding.


 



    	14 



    	 



    

 


Section
5.05 Amendments and Modifications. Upon the written consent of the Company and the Holders of at least a majority in interest
of the Registrable Securities at the time in question, compliance with any of the provisions, covenants and conditions set forth
in this Agreement may be waived, or any of such provisions, covenants or conditions may be amended or modified; provided,
however, that notwithstanding the foregoing, any amendment hereto or waiver hereof that adversely affects one Holder, solely
in its capacity as a holder of the shares of capital stock of the Company, in a manner that is materially different from the other
Holders (in such capacity) shall require the consent of the Holder so affected. No course of dealing between any Holder or the
Company and any other party hereto or any failure or delay on the part of a Holder or the Company in exercising any rights or
remedies under this Agreement shall operate as a waiver of any rights or remedies of any Holder or the Company. No single or partial
exercise of any rights or remedies under this Agreement by a party shall operate as a waiver or preclude the exercise of any other
rights or remedies hereunder or thereunder by such party.


 


[SIGNATURE
PAGES FOLLOW]


 




    	15 



    	 



    

 


IN
WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the date first written above.


 


	COMPANY:	 
	 	 
	AMERGENT HOSPITALITY GROUP, INC.	 
	 	 	 
	By:	 	 
	 	Michael D. Pruitt, Chief Executive Officer	 


 


[SIGNATURE
PAGE REGISTRATION RIGHTS AGREEMENT]


 




    	 



    	 



    

 





	HOLDERS:	 	 	 
	 	 	 	 
	OZ
    REY, LLC	 	ARENA
    INVESTORS, LP
	 	 	 	 	 
	By:	                                	 	By:	       
		Robert
    S. Hersch, Manager 	 	Name:	 
	 	 	 	Title:	 
	 	 	 	 	 
	Jonathan
    & Nancy Glaser Family Trust DTD 12-16-98	 	Larry
                                         S. Spitcaufsky, Trustee of Larry

                                                                                Spitcaufsky
                                         Family Trust UTD 1-19-88

	 	 	 	 	 
	By:	 	 	By:	 
	Name:	Jonathan
    Glaser	 	Name:	Larry
    Spitcaufsky
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	Bryan
                                         Ezralow TTEE of the Bryan Ezralow

                                                                                1994
                                         Trust DTD 12-22-94
	EMSE,
                                         LLC, a Delaware limited liability

                                                                                company

	 	 	 	 	 
	By:	 	 	By:	
	 Name:	Bryan
    Ezralow	 	Name:	Bryan
                                         Ezralow, as Trustee of the Bryan

                                                                              Ezralow
                                         1994 Trust U/T/D 12-22-94

	Title:	Trustee	 	Title:	Manager
    and Member
	 	 	 	 	 
	Marc
    Ezralow 1997 Trust u/t/d 11.26.1997	 	Elevado
                                         Investment Company, LLC, a

                                                                                Delaware
                                         limited liability company

	 	 	 	 	 
	By:	 	 	By:	
	Name:	Mark
    Ezralow	 	Name:	Bryan
                                         Ezralow, as Trustee of the Ezralow

                                                                              Family
                                         Trust U/T/D 12/09/1980

	Title:	Trustee	 	Title:	Manager
    and Member
	 	 	 	 	 
	SPA
    Trust u/t/d 09.13.2004	 	David
    Leff Family Trust u/t/d 02.03.1988
	 	 	 	 	 
	By:	 	 	By:	 
	Name:	Mark
    Ezralow	 	Name:	David
    Michael Leff
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	C
    and R Irrevocable Trust u/t/d 11.05.2007	 	Freedman
    Family Trust u/t/d 05.25.1982
	 	 	 	 	 
	By:	 	 	By:	 
	Name:	David
    Michael Leff	 	Name:	Gary
    E. Freedman
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	Freedman
    2006 Irrevocable Trust u/t/d 02.27.2006	 	Haddad
    Family Trust
	 	 	 	 	 
	By:	                     	 	By:	 
	Name:	Gary
    E. Freedman	 	Name:	David
    Haddad
	Title:	Trustee	 	Title:	Trustee
	 	 	 	 	 
	 	 	 	Joshua
    and Julie Ofman Family Trust
	 	 	 	 	 
	 	 	 	By:	 
	Douglas
    S. Ramer	 	Name:	Joshua
    J. Ofman 
	 	 	 	Title:	Trustee



 


[SIGNATURE
PAGE
REGISTRATION
RIGHTS
AGREEMENT]


 






    	 



    	 



    

 





	 	 	TR
    Capital Growth Fund, LLC
	 	 	 	 
	 	 	By:	 
	Karen
    Kang	 	Name:	 
	 	 	Title:	 
	 	 	 	 
	Russell
    Steward	 	Michael
    E. Meyers
	 	 	 
	CCM
    Holdings, Inc.	 	John
                                         W. Galuchie Jr. & Marianne C. Galuchie

                                                                     TTEES
                                         Galuchie Living Trust DTD 9/11/00

	 	 	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	 
	Title:	 	 	Title:	 
	 	 	 	 	 
	T.R.
    Winston & Company LLC	 	G.
                                         Tyler Runnels and Jasmine N. Runnels

                                                                     TTEES
                                         The Runnels Family Trust DTD 1-11- 2000

	 	 	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	 
	Title:	 	 	Title:	 
	 	 	 	 	 
	Larry
                                         Steven Spitcaufsky TTEE Larry S.

                                                                     Spitcaufsky
                                         Family Trust U/A DTD 08/23/1995
	 	Larry
                                         Steven Spitcaufsky Charles Schwab &

                                                                     Co
                                         Inc. Cust Roth Contributory IRA

	 	 	 	 	 
	By:	 	 	By:	 
	Name:	 	 	Name:	 
	Title:	 	 	Title:	 


 


[SIGNATURE
PAGE
REGISTRATION
RIGHTS
AGREEMENT]


 







    	 



    	 



    

 


EXHIBIT
C


 


SECURITY
AGREEMENT


 


This
SECURITY AGREEMENT, dated as of April 1, 2020 (this “Agreement”), is among Amergent Hospitality Group, Inc.,
a Delaware corporation (the “Company”), all of the Subsidiaries of the Company (such subsidiaries, the “Guarantors”
and together with the Company, the “Debtors”) and the holders of the Company’s 10.0% Secured Convertible
Debentures in the original aggregate principal amount of $4,037,889 (collectively, the “Debentures”) signatory
hereto, their endorsees, transferees and assigns (collectively, the “Secured Parties”).


 


W
I T N E S S E T H:


 


WHEREAS,
pursuant to the Purchase Agreement (as defined in the Debentures), the Secured Parties have severally agreed to extend the loans
to the Company evidenced by the Debentures;


 


WHEREAS,
pursuant to a certain Subsidiary Guarantee, dated as of the date hereof (the “Guarantee”), the Guarantors have
jointly and severally agreed to guarantee and act as surety for payment of such Debentures; and


 


WHEREAS,
in order to induce the Secured Parties to extend the loans evidenced by the Debentures, each Debtor has agreed to execute and
deliver to the Secured Parties this Agreement and to grant the Secured Parties, pari passu with each other Secured Party
and through the Agent (as defined in Section 18 hereof), a security interest in certain property of such Debtor to secure the
prompt payment, performance and discharge in full of all of the Company’s obligations under the Debentures and the Guarantors’
obligations under the Guarantee.


 


NOW,
THEREFORE, in consideration of the agreements herein contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:


 


1. Certain
Definitions. As used in this Agreement, the following terms shall have the meanings set forth in this Section 1. Terms used
but not otherwise defined in this Agreement that are defined in Article 9 of the UCC (such as “account”, “chattel
paper”, “commercial tort claim”, “deposit account”, “document”, “equipment”,
“fixtures”, “general intangibles”, “goods”, “instruments”, “inventory”,
“investment property”, “letter-of-credit rights”, “proceeds” and “supporting obligations”)
shall have the respective meanings given such terms in Article 9 of the UCC.


 


(a) “Collateral”
means the collateral in which the Secured Parties are granted a security interest by this Agreement and which shall include all
the personal property of the Debtors, whether presently owned or existing or hereafter acquired or coming into existence, wherever
situated, and all additions and accessions thereto and all substitutions and replacements thereof, and all proceeds, products
and accounts thereof, including, without limitation, all proceeds from the sale or transfer of the Collateral and of insurance
covering the same and of any tort claims in connection therewith, and all dividends, interest, cash, notes, securities, equity
interest or other property at any time and from time to time acquired, receivable or otherwise distributed in respect of, or in
exchange for, any or all of the Pledged Securities (as defined below), including the following:


 




    	1 



    	 



    

 


(i) All
goods, including, without limitation, (A) all machinery, equipment, computers, motor vehicles, trucks, tanks, boats, ships, appliances,
furniture, special and general tools, fixtures, test and quality control devices and other equipment of every kind and nature
and wherever situated, together with all documents of title and documents representing the same, all additions and accessions
thereto, replacements therefor, all parts therefor, and all substitutes for any of the foregoing and all other items used and
useful in connection with any Debtor’s businesses and all improvements thereto; and (B) all inventory;


 


(ii) All
contract rights and other general intangibles, including, without limitation, all partnership interests, membership interests,
stock or other securities, rights under any of the Organizational Documents, agreements related to the Pledged Securities, licenses,
distribution and other agreements, computer software (whether “off-the-shelf”, licensed from any third party or developed
by any Debtor), computer software development rights, leases, franchises, customer lists, quality control procedures, grants and
rights, goodwill, Intellectual Property and income tax refunds;


 


(iii) All
accounts, together with all instruments, all documents of title representing any of the foregoing, all rights in any merchandising,
goods, equipment, motor vehicles and trucks which any of the same may represent, and all right, title, security and guaranties
with respect to each account, including any right of stoppage in transit;


 


(iv)
All documents, letter-of-credit rights, instruments and chattel paper;




 


(v)
All commercial tort claims;




 


(vi) All
deposit accounts and all cash (whether or not deposited in such deposit accounts);


 


(vii)
All investment property;




 


(viii)
All supporting obligations;




 


(ix) All
files, records, books of account, business papers, and computer programs;


 


(x)
All Intellectual Property; and


 






    	2 



    	 



    

 


(xi) the
products and proceeds of all of the foregoing Collateral set forth in clauses (i)-(x) above.


 


Without
limiting the generality of the foregoing, the “Collateral” shall include all investment property and general
intangibles respecting ownership and/or other equity interests in each Guarantor, including, without limitation, the shares of
capital stock and the other equity interests listed on Schedule H hereto (as the same may be modified from time to time
pursuant to the terms hereof), and any other shares of capital stock and/or other equity interests of any other direct or indirect
subsidiary of any Debtor obtained in the future, and, in each case, all certificates representing such shares and/or equity interests
and, in each case, all rights, options, warrants, stock, other securities and/or equity interests that may hereafter be received,
receivable or distributed in respect of, or exchanged for, any of the foregoing and all rights arising under or in connection
with the Pledged Securities, including, but not limited to, all dividends, interest and cash.


 


Notwithstanding
the foregoing, nothing herein shall be deemed to constitute an assignment of any asset which, in the event of an assignment, becomes
void by operation of applicable law or the assignment of which is otherwise prohibited by applicable law (in each case to the
extent that such applicable law is not overridden by Sections 9-406, 9-407 and/or 9-408 of the UCC or other similar applicable
law); provided, however, that to the extent permitted by applicable law, this Agreement shall create a valid security
interest in such asset and, to the extent permitted by applicable law, this Agreement shall create a valid security interest in
the proceeds of such asset.


 


Notwithstanding
the foregoing, neither the segregated cash account established by the Company in favor of Arena Investors, LP (“Investor”),
established pursuant to the terms of the securities purchase agreement dated February 2, 2020, between the Investor and Chanticleer
Holdings, Inc. (the “Segregated Account”), nor the proceeds thereof that are or may become payable to Investor or
its assigns shall constitute “Collateral” under this Agreement.


 


(b) “Intellectual
Property” means the collective reference to all rights, priorities and privileges relating to intellectual property,
whether arising under United States, multinational or foreign laws or otherwise, including, without limitation, (i) all copyrights
arising under the laws of the United States, any other country or any political subdivision thereof, whether registered or unregistered
and whether published or unpublished, all registrations and recordings thereof, and all applications in connection therewith,
including, without limitation, all registrations, recordings and applications in the United States Copyright Office, (ii) all
letters patent of the United States, any other country or any political subdivision thereof, all reissues and extensions thereof,
and all applications for letters patent of the United States or any other country and all divisions, continuations and continuations-in-part
thereof, (iii) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade dress,
service marks, logos, domain names and other source or business identifiers, and all goodwill associated therewith, now existing
or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, whether
in the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or
any other country or any political subdivision thereof, or otherwise, and all common law rights related thereto, (iv) all trade
secrets arising under the laws of the United States, any other country or any political subdivision thereof, (v) all rights to
obtain any reissues, renewals or extensions of the foregoing, (vi) all licenses for any of the foregoing, and (vii) all causes
of action for infringement of the foregoing.


 




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(c) “Majority
in Interest” means, at any time of determination, the majority in interest (based on then-outstanding principal amounts
of Debentures at the time of such determination) of the Secured Parties.


 


(d) “Necessary
Endorsement” means undated stock powers endorsed in blank or other proper instruments of assignment duly executed and
such other instruments or documents as the Agent (as that term is defined below) may reasonably request.


 


(e) “Obligations”
means all of the liabilities and obligations (primary, secondary, direct, contingent, sole, joint or several) due or to become
due, or that are now or may be hereafter contracted or acquired, or owing to, of any Debtor to the Secured Parties, including,
without limitation, all obligations under this Agreement, the Debentures, the Guarantee and any other instruments, agreements
or other documents executed and/or delivered in connection herewith or therewith, in each case, whether now or hereafter existing,
voluntary or involuntary, direct or indirect, absolute or contingent, liquidated or unliquidated, whether or not jointly owed
with others, and whether or not from time to time decreased or extinguished and later increased, created or incurred, and all
or any portion of such obligations or liabilities that are paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from any of the Secured Parties as a preference, fraudulent transfer or otherwise as such obligations may
be amended, supplemented, converted, extended or modified from time to time. Without limiting the generality of the foregoing,
the term “Obligations” shall include, without limitation: (i) principal of, and interest on the Debentures and the
loans extended pursuant thereto; (ii) any and all other fees, indemnities, costs, obligations and liabilities of the Debtors from
time to time under or in connection with this Agreement, the Debentures, the Guarantee and any other instruments, agreements or
other documents executed and/or delivered in connection herewith or therewith; and (iii) all amounts (including but not limited
to post-petition interest) in respect of the foregoing that would be payable but for the fact that the obligations to pay such
amounts are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving
any Debtor.


 


(f) “Organizational
Documents” means with respect to any Debtor, the documents by which such Debtor was organized (such as a certificate
of incorporation, certificate of limited partnership or articles of organization, and including, without limitation, any certificates
of designation for preferred stock or other forms of preferred equity) and which relate to the internal governance of such Debtor
(such as bylaws, a partnership agreement or an operating, limited liability or members agreement).


 




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(g)
“Pledged Interests” shall have the meaning ascribed to such term in Section 4(j).




 


(h)
“Pledged Securities” shall have the meaning ascribed to such term in Section 4(i).


 


(i) “UCC”
means the Uniform Commercial Code of the State of New York and or any other applicable law of any state or states which has jurisdiction
with respect to all, or any portion of, the Collateral or this Agreement, from time to time. It is the intent of the parties that
defined terms in the UCC should be construed in their broadest sense so that the term “Collateral” will be construed
in its broadest sense. Accordingly if there are, from time to time, changes to defined terms in the UCC that broaden the definitions,
they are incorporated herein and if existing definitions in the UCC are broader than the amended definitions, the existing ones
shall be controlling.


 


2. Grant
of Security Interest in Collateral. As an inducement for the Secured Parties to extend the loans as evidenced by the Debentures
and to secure the complete and timely payment, performance and discharge in full, as the case may be, of all of the Obligations,
each Debtor hereby unconditionally and irrevocably pledges, grants and hypothecates to the Secured Parties a security interest
in and to, a lien upon and a right of set-off against all of their respective right, title and interest of whatsoever kind and
nature in and to, the Collateral (a “Security Interest” and, collectively, the “Security Interests”).


 


3. Delivery
of Certain Collateral. Contemporaneously or prior to the execution of this Agreement, each Debtor shall deliver or cause to
be delivered to the Agent (a) any and all certificates and other instruments representing or evidencing the Pledged Securities,
and (b) any and all certificates and other instruments or documents representing any of the other Collateral, in each case, together
with all Necessary Endorsements. The Debtors are, contemporaneously with the execution hereof, delivering to Agent, or have previously
delivered to Agent, a true and correct copy of each Organizational Document governing any of the Pledged Securities.


 


4. Representations,
Warranties, Covenants and Agreements of the Debtors. Except as set forth under the corresponding section of the disclosure
schedules delivered to the Secured Parties concurrently herewith (the “Disclosure Schedules”), which Disclosure
Schedules shall be deemed a part hereof, each Debtor represents and warrants to, and covenants and agrees with, the Secured Parties
as follows:


 


(a) Each
Debtor has the requisite corporate, partnership, limited liability company or other power and authority to enter into this Agreement
and otherwise to carry out its obligations hereunder. The execution, delivery and performance by each Debtor of this Agreement
and the filings contemplated therein have been duly authorized by all necessary action on the part of such Debtor and no further
action is required by such Debtor. This Agreement has been duly executed by each Debtor. This Agreement constitutes the legal,
valid and binding obligation of each Debtor, enforceable against each Debtor in accordance with its terms except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization and similar laws of general application relating to or affecting
the rights and remedies of creditors and by general principles of equity.


 




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(b) The
Debtors have no place of business or offices where their respective books of account and records are kept (other than temporarily
at the offices of its attorneys or accountants) or places where Collateral is stored or located, except as set forth on Schedule
A attached hereto. Except as specifically set forth on Schedule A, each Debtor is the record owner of the real property
where such Collateral is located, and there exist no mortgages or other liens on any such real property except for Permitted Liens
(as defined in the Debentures). Except as disclosed on Schedule A, none of such Collateral is in the possession of any
consignee, bailee, warehouseman, agent or processor.


 


(c) Except
for Permitted Liens (as defined in the Debentures) and except as set forth on Schedule B attached hereto, the Debtors are
the sole owner of the Collateral (except for non-exclusive licenses granted by any Debtor in the ordinary course of business),
free and clear of any liens, security interests, encumbrances, rights or claims, and are fully authorized to grant the Security
Interests. Except as set forth on Schedule C attached hereto, there is not on file in any governmental or regulatory authority,
agency or recording office an effective financing statement, security agreement, license or transfer or any notice of any of the
foregoing (other than those that will be filed in favor of the Secured Parties pursuant to this Agreement) covering or affecting
any of the Collateral. Except as set forth on Schedule C attached hereto and except pursuant to this Agreement, as long
as this Agreement shall be in effect, the Debtors shall not execute and shall not knowingly permit to be on file in any such office
or agency any other financing statement or other document or instrument (except to the extent filed or recorded in favor of the
Secured Parties pursuant to the terms of this Agreement).


 


(d) No
written claim has been received that any Collateral or any Debtor’s use of any Collateral violates the rights of any third
party. There has been no adverse decision to any Debtor’s claim of ownership rights in or exclusive rights to use the Collateral
in any jurisdiction or to any Debtor’s right to keep and maintain such Collateral in full force and effect, and there is
no proceeding involving said rights pending or, to the best knowledge of any Debtor, threatened before any court, judicial body,
administrative or regulatory agency, arbitrator or other governmental authority.


 


(e) Each
Debtor shall at all times maintain its books of account and records relating to the Collateral at its principal place of business
and its Collateral at the locations set forth on Schedule A attached hereto and may not relocate such books of account
and records or tangible Collateral unless it delivers to the Secured Parties at least 30 days prior to such relocation (i) written
notice of such relocation and the new location thereof (which must be within the United States) and (ii) evidence that appropriate
financing statements under the UCC and other necessary documents have been filed and recorded and other steps have been taken
to perfect the Security Interests to create in favor of the Secured Parties a valid, perfected and continuing perfected lien in
the Collateral.


 




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(f) This
Agreement creates in favor of the Secured Parties a valid security interest in the Collateral, subject only to Permitted
Liens (as defined in the Debentures) securing the payment and performance of the Obligations. Upon making the filings
described in the immediately following paragraph, all security interests created hereunder in any Collateral which may be
perfected by filing Uniform Commercial Code financing statements shall have been duly perfected. Except for the filing of the
Uniform Commercial Code financing statements referred to in the immediately following paragraph, the recordation of the
Intellectual Property Security Agreement (as defined in Section 4(p) hereof) with respect to copyrights and copyright
applications in the United States Copyright Office referred to in paragraph (m), the execution and delivery of deposit
account control agreements satisfying the requirements of Section 9-104(a)(2) of the UCC with respect to each deposit account
of the Debtors, and the delivery of the certificates and other instruments provided in Section 3, no action is necessary to
create, perfect or protect the security interests created hereunder. Without limiting the generality of the foregoing, except
for the filing of said financing statements, the recordation of said Intellectual Property Security Agreement, and the
execution and delivery of said deposit account control agreements, no consent of any third parties and no authorization,
approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for
(i) the execution, delivery and performance of this Agreement, (ii) the creation or perfection of the Security Interests
created hereunder in the Collateral or (iii) the enforcement of the rights of the Agent and the Secured Parties
hereunder.


 


(g) Each
Debtor hereby authorizes the Agent to file one or more financing statements under the UCC, with respect to the Security Interests,
with the proper filing and recording agencies in any jurisdiction deemed proper by it.


 


(h) The
execution, delivery and performance of this Agreement by the Debtors does not (i) violate any of the provisions of any Organizational
Documents of any Debtor or any judgment, decree, order or award of any court, governmental body or arbitrator or any applicable
law, rule or regulation applicable to any Debtor or (ii) conflict with, or constitute a default (or an event that with notice
or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or
cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing
any Debtor’s debt or otherwise) or other understanding to which any Debtor is a party or by which any property or asset
of any Debtor is bound or affected. If any, all required consents (including, without limitation, from stockholders or creditors
of any Debtor) necessary for any Debtor to enter into and perform its obligations hereunder have been obtained.


 


(i) The
capital stock and other equity interests listed on Schedule H hereto (the “Pledged Securities”) represent all
of the capital stock and other equity interests of the Guarantors, and represent all capital stock and other equity interests
owned, directly or indirectly, by the Company. All of the Pledged Securities are validly issued, fully paid and nonassessable,
and the Company is the legal and beneficial owner of the Pledged Securities, free and clear of any lien, security interest or
other encumbrance except for the security interests created by this Agreement and other Permitted Liens (as defined in the Debentures).


 




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(j) The
ownership and other equity interests in partnerships and limited liability companies (if any) included in the Collateral (the
“Pledged Interests”) by their express terms do not provide that they are securities governed by Article 8 of
the UCC and are not held in a securities account or by any financial intermediary.


 


(k) Except
for Permitted Liens (as defined in the Debentures), each Debtor shall at all times maintain the liens and Security Interests provided
for hereunder as valid and perfected first priority liens and security interests in the Collateral in favor of the Secured Parties
until this Agreement and the Security Interest hereunder shall be terminated pursuant to Section 14 hereof. Each Debtor hereby
agrees to defend the same against the claims of any and all persons and entities. Each Debtor shall safeguard and protect all
Collateral for the account of the Secured Parties. At the request of the Agent, each Debtor will sign and deliver to the Agent
on behalf of the Secured Parties at any time or from time to time one or more financing statements pursuant to the UCC in form
reasonably satisfactory to the Agent and will pay the cost of filing the same in all public offices wherever filing is, or is
deemed by the Agent to be, necessary or desirable to effect the rights and obligations provided for herein. Without limiting the
generality of the foregoing, each Debtor shall pay all fees, taxes and other amounts necessary to maintain the Collateral and
the Security Interests hereunder, and each Debtor shall obtain and furnish to the Agent from time to time, upon demand, such releases
and/or subordinations of claims and liens which may be required to maintain the priority of the Security Interests hereunder.


 


(l) No
Debtor will transfer, pledge, hypothecate, encumber, license, sell or otherwise dispose of any of the Collateral (except for non-exclusive
licenses granted by a Debtor in its ordinary course of business and sales of inventory by a Debtor in its ordinary course of business)
without the prior written consent of a Majority in Interest.


 


(m) Each
Debtor shall keep and preserve its equipment, inventory and other tangible Collateral in good condition, repair and order and
shall not operate or locate any such Collateral (or cause to be operated or located) in any area excluded from insurance coverage.


 


(n) Each
Debtor shall maintain with financially sound and reputable insurers, insurance with respect to the Collateral, including Collateral
hereafter acquired, against loss or damage of the kinds and in the amounts customarily insured against by entities of established
reputation having similar properties similarly situated and in such amounts as are customarily carried under similar circumstances
by other such entities and otherwise as is prudent for entities engaged in similar businesses but in any event sufficient to cover
the full replacement cost thereof. Each Debtor shall cause each insurance policy issued in connection herewith to provide, and
the insurer issuing such policy to certify to the Agent, that (a) the Agent will be named as lender loss payee and additional
insured under each such insurance policy; (b) if such insurance be proposed to be cancelled or materially changed for any reason
whatsoever, such insurer will promptly notify the Agent and such cancellation or change shall not be effective as to the Agent
for at least thirty (30) days after receipt by the Agent of such notice, unless the effect of such change is to extend or increase
coverage under the policy; and (c) the Agent will have the right (but no obligation) at its election to remedy any default in
the payment of premiums within thirty (30) days of notice from the insurer of such default. If no Event of Default (as defined
in the Debentures) exists and if the proceeds arising out of any claim or series of related claims do not exceed $100,000, loss
payments in each instance will be applied by the applicable Debtor to the repair and/or replacement of property with respect to
which the loss was incurred to the extent reasonably feasible, and any loss payments or the balance thereof remaining, to the
extent not so applied, shall be payable to the applicable Debtor; provided, however, that payments received by any
Debtor after an Event of Default occurs and is continuing or in excess of $100,000 for any occurrence or series of related occurrences
shall be paid to the Agent on behalf of the Secured Parties and, if received by such Debtor, shall be held in trust for the Secured
Parties and immediately paid over to the Agent unless otherwise directed in writing by the Agent. Copies of such policies or the
related certificates, in each case, naming the Agent as lender loss payee and additional insured shall be delivered to the Agent
at least annually and at the time any new policy of insurance is issued.


 




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(o) Each
Debtor shall, within ten (10) days of obtaining knowledge thereof, advise the Secured Parties promptly, in sufficient detail,
of any material adverse change in the Collateral, and of the occurrence of any event which would have a material adverse effect
on the value of the Collateral or on the Secured Parties’ security interest, through the Agent, therein.


 


(p) Each
Debtor shall promptly execute and deliver to the Agent such further deeds, mortgages, assignments, security agreements, financing
statements or other instruments, documents, certificates and assurances and take such further action as the Agent may from time
to time request and may in its sole discretion deem necessary to perfect, protect or enforce the Secured Parties’ security
interest in the Collateral including, without limitation, if applicable, the execution and delivery of a separate security agreement
with respect to each Debtor’s Intellectual Property (“Intellectual Property Security Agreement”) in which
the Secured Parties have been granted a security interest hereunder, substantially in a form reasonably acceptable to the Agent,
which Intellectual Property Security Agreement, other than as stated therein, shall be subject to all of the terms and conditions
hereof.


 


(q) Each
Debtor shall permit the Agent and its representatives and agents to inspect the Collateral during normal business hours and upon
reasonable prior notice, and to make copies of records pertaining to the Collateral as may be reasonably requested by the Agent
from time to time.


 


(r) Each
Debtor shall take all steps reasonably necessary to diligently pursue and seek to preserve, enforce and collect any rights, claims,
causes of action and accounts receivable in respect of the Collateral.


 




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(s) Each
Debtor shall promptly notify the Secured Parties in sufficient detail upon becoming aware of any attachment, garnishment, execution
or other legal process levied against any Collateral and of any other information received by such Debtor that may materially
affect the value of the Collateral, the Security Interest or the rights and remedies of the Secured Parties hereunder.


 


(t) All
information heretofore, herein or hereafter supplied to the Secured Parties by or on behalf of any Debtor with respect to the
Collateral is accurate and complete in all material respects as of the date furnished.


 


(u) The
Debtors shall at all times preserve and keep in full force and effect their respective valid existence and good standing and any
rights and franchises material to its business.


 


(v) No
Debtor will change its name, type of organization, jurisdiction of organization, organizational identification number (if it has
one), legal or corporate structure, or identity, or add any new fictitious name unless it provides at least 30 days prior written
notice to the Secured Parties of such change and, at the time of such written notification, such Debtor provides any financing
statements or fixture filings necessary to perfect and continue the perfection of the Security Interests granted and evidenced
by this Agreement.


 


(w) Except
in the ordinary course of business, no Debtor may consign any of its inventory or sell any of its inventory on bill and hold,
sale or return, sale on approval, or other conditional terms of sale without the consent of the Agent which shall not be unreasonably
withheld.


 


(x) No
Debtor may relocate its chief executive office to a new location without providing 30 days prior written notification thereof
to the Secured Parties and so long as, at the time of such written notification, such Debtor provides any financing statements
or fixture filings necessary to perfect and continue the perfection of the Security Interests granted and evidenced by this Agreement.


 


(y) Each
Debtor was organized and remains organized solely under the laws of the state set forth next to such Debtor’s name in Schedule
D attached hereto, which Schedule D sets forth each Debtor’s organizational identification number or, if any
Debtor does not have one, states that one does not exist.


 


(z) (i)
The actual name of each Debtor is the name set forth in Schedule D attached hereto; (ii) no Debtor has any trade names
except as set forth on Schedule E attached hereto; (iii) no Debtor has used any name other than that stated in the preamble
hereto or as set forth on Schedule E for the preceding five years; and (iv) no entity has merged into any Debtor or been
acquired by any Debtor within the past five years except as set forth on Schedule E.


 




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(aa)
At any time and from time to time that any Collateral consists of instruments, certificated securities or other items that require
or permit possession by the secured party to perfect the security interest created hereby, the applicable Debtor shall deliver
such Collateral to the Agent.


 


(bb)
Each Debtor, in its capacity as issuer, hereby agrees to comply with any and all orders and instructions of Agent regarding the
Pledged Interests consistent with the terms of this Agreement without the further consent of any Debtor as contemplated by Section
8-106 (or any successor section) of the UCC. Further, each Debtor agrees that it shall not enter into a similar agreement (or
one that would confer “control” within the meaning of Article 8 of the UCC) with any other person or entity.


 


(cc)
Each Debtor shall cause all tangible chattel paper constituting Collateral to be delivered to the Agent, or, if such delivery
is not possible, then to cause such tangible chattel paper to contain a legend noting that it is subject to the security interest
created by this Agreement. To the extent that any Collateral consists of electronic chattel paper, the applicable Debtor shall
cause the underlying chattel paper to be “marked” within the meaning of Section 9-105 of the UCC (or successor section
thereto).


 


(dd)
If there is any investment property or deposit account included as Collateral that can be perfected by “control” through
an account control agreement, the applicable Debtor shall cause such an account control agreement, in form and substance in each
case satisfactory to the Agent, to be entered into and delivered to the Agent for the benefit of the Secured Parties.


 


(ee)
To the extent that any Collateral consists of letter-of-credit rights, the applicable Debtor shall cause the issuer of each underlying
letter of credit to consent to an assignment of the proceeds thereof to the Secured Parties.


 


(ff)
To the extent that any Collateral is in the possession of any third party, the applicable Debtor shall join with the Agent in
notifying such third party of the Secured Parties’ security interest in such Collateral and shall use its best efforts to
obtain an acknowledgement and agreement from such third party with respect to the Collateral, in form and substance reasonably
satisfactory to the Agent.


 


(gg)
If any Debtor shall at any time hold or acquire a commercial tort claim, such Debtor shall promptly notify the Secured Parties
in a writing signed by such Debtor of the particulars thereof and grant to the Secured Parties in such writing a security interest
therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance satisfactory
to the Agent.


 


(hh)
Each Debtor shall immediately provide written notice to the Secured Parties of any and all accounts which arise out of contracts
with any governmental authority and, to the extent necessary to perfect or continue the perfected status of the Security Interests
in such accounts and proceeds thereof, shall execute and deliver to the Agent an assignment of claims for such accounts and cooperate
with the Agent in taking any other steps required, in its judgment, under the Federal Assignment of Claims Act or any similar
federal, state or local statute or rule to perfect or continue the perfected status of the Security Interests in such accounts
and proceeds thereof.


 




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(ii) Each
Debtor shall cause each subsidiary of such Debtor to immediately become a party hereto (an “Additional Debtor”), by
executing and delivering an Additional Debtor Joinder in substantially the form of Annex A attached hereto and comply with
the provisions hereof applicable to the Debtors. Concurrent therewith, the Additional Debtor shall deliver replacement schedules
for, or supplements to all other Schedules to (or referred to in) this Agreement, as applicable, which replacement schedules shall
supersede, or supplements shall modify, the Schedules then in effect. The Additional Debtor shall also deliver such opinions of
counsel, authorizing resolutions, good standing certificates, incumbency certificates, organizational documents, financing statements
and other information and documentation as the Agent may reasonably request. Upon delivery of the foregoing to the Agent, the
Additional Debtor shall be and become a party to this Agreement with the same rights and obligations as the Debtors, for all purposes
hereof as fully and to the same extent as if it were an original signatory hereto and shall be deemed to have made the representations,
warranties and covenants set forth herein as of the date of execution and delivery of such Additional Debtor Joinder, and all
references herein to the “Debtors” shall be deemed to include each Additional Debtor.


 


(jj)
Each Debtor shall vote the Pledged Securities to comply with the covenants and agreements set forth herein and in the Debentures.


 


(kk)
Each Debtor shall register the pledge of the applicable Pledged Securities on the books of such Debtor. Each Debtor shall notify
each issuer of Pledged Securities to register the pledge of the applicable Pledged Securities in the name of the Secured Parties
on the books of such issuer. Further, except with respect to certificated securities delivered to the Agent, the applicable Debtor
shall deliver to Agent an acknowledgement of pledge (which, where appropriate, shall comply with the requirements of the relevant
UCC with respect to perfection by registration) signed by the issuer of the applicable Pledged Securities, which acknowledgement
shall confirm that: (a) it has registered the pledge on its books and records; and (b) at any time directed by Agent during the
continuation of an Event of Default, such issuer will transfer the record ownership of such Pledged Securities into the name of
any designee of Agent, will take such steps as may be necessary to effect the transfer, and will comply with all other instructions
of Agent regarding such Pledged Securities without the further consent of the applicable Debtor.


 


(ll)
In the event that, upon an occurrence of an Event of Default, Agent shall sell all or any of the Pledged Securities to another
party or parties (herein called the “Transferee”) or shall purchase or retain all or any of the Pledged Securities,
each Debtor shall, to the extent applicable: (i) deliver to Agent or the Transferee, as the case may be, the articles of incorporation,
bylaws, minute books, stock certificate books, corporate seals, deeds, leases, indentures, agreements, evidences of indebtedness,
books of account, financial records and all other Organizational Documents and records of the Debtors and their direct and indirect
subsidiaries; (ii) use its best efforts to obtain resignations of the persons then serving as officers and directors of the Debtors
and their direct and indirect subsidiaries, if so requested; and (iii) use its best efforts to obtain any approvals that are required
by any governmental or regulatory body in order to permit the sale of the Pledged Securities to the Transferee or the purchase
or retention of the Pledged Securities by Agent and allow the Transferee or Agent to continue the business of the Debtors and
their direct and indirect subsidiaries.


 




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(mm)
Without limiting the generality of the other obligations of the Debtors hereunder, each Debtor shall promptly (i) cause to be
registered at the United States Copyright Office all of its material copyrights, (ii) cause the security interest contemplated
hereby with respect to all Intellectual Property registered at the United States Copyright Office or United States Patent and
Trademark Office to be duly recorded at the applicable office, and (iii) give the Agent notice whenever it acquires (whether absolutely
or by license) or creates any additional material Intellectual Property.


 


(nn)
Each Debtor will from time to time, at the joint and several expense of the Debtors, promptly execute and deliver all such further
instruments and documents, and take all such further action as may be necessary or desirable, or as the Agent may reasonably request,
in order to perfect and protect any security interest granted or purported to be granted hereby or to enable the Secured Parties
to exercise and enforce their rights and remedies hereunder and with respect to any Collateral or to otherwise carry out the purposes
of this Agreement.


 


(oo)
Schedule F attached hereto lists all of the patents, patent applications, trademarks, trademark applications, registered
copyrights, and domain names owned by any of the Debtors as of the date hereof. Schedule F lists all material licenses
in favor of any Debtor for the use of any patents, trademarks, copyrights and domain names as of the date hereof. All material
patents and trademarks of the Debtors have been duly recorded at the United States Patent and Trademark Office and all material
copyrights of the Debtors have been duly recorded at the United States Copyright Office.


 


(pp)
Except as set forth on Schedule G attached hereto, none of the account debtors or other persons or entities obligated on
any of the Collateral is a governmental authority covered by the Federal Assignment of Claims Act or any similar federal, state
or local statute or rule in respect of such Collateral.


 


(qq)
Until the Obligations shall have been paid and performed in full, the Company covenants that it shall promptly direct any direct
or indirect subsidiary of the Company formed or acquired after the date hereof to enter into a Subsidiary Guarantee in favor of
the Secured Party, in the form of Exhibit F to the Purchase Agreement.


 


5. Effect
of Pledge on Certain Rights. If any of the Collateral subject to this Agreement consists of nonvoting equity or ownership
interests (regardless of class, designation, preference or rights) that may be converted into voting equity or ownership interests
upon the occurrence of certain events (including, without limitation, upon the transfer of all or any of the other stock or assets
of the issuer), it is agreed that the pledge of such equity or ownership interests pursuant to this Agreement or the enforcement
of any of Agent’s rights hereunder shall not be deemed to be the type of event which would trigger such conversion rights
notwithstanding any provisions in the Organizational Documents or agreements to which any Debtor is subject or to which any Debtor
is party.


 




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6.
Defaults. The following events shall be “Events of Default”:




 


(a) The
occurrence of an Event of Default (as defined in the Debentures) under the Debentures;


 


(b) Any
representation or warranty of any Debtor in this Agreement shall prove to have been incorrect in any material respect when made;


 


(c) The
failure by any Debtor to observe or perform any of its obligations hereunder for five (5) days after delivery to such Debtor of
notice of such failure by or on behalf of a Secured Party unless such default is capable of cure but cannot be cured within such
time frame and such Debtor is using best efforts to cure same in a timely fashion; or


 


(d) If
any provision of this Agreement shall at any time for any reason be declared to be null and void, or the validity or enforceability
thereof shall be contested by any Debtor, or a proceeding shall be commenced by any Debtor, or by any governmental authority having
jurisdiction over any Debtor, seeking to establish the invalidity or unenforceability thereof, or any Debtor shall deny that any
Debtor has any liability or obligation purported to be created under this Agreement.


 


7.
Duty To Hold In Trust.




 


(a) Upon
the occurrence of any Event of Default and at any time thereafter, each Debtor shall, upon receipt of any revenue, income, dividend,
interest or other sums subject to the Security Interests, whether payable pursuant to the Debentures or otherwise, or of any check,
draft, note, trade acceptance or other instrument evidencing an obligation to pay any such sum, hold the same in trust for the
Secured Parties and shall forthwith endorse and transfer any such sums or instruments, or both, to the Secured Parties, pro-rata
in proportion to their respective then-currently outstanding principal amount of Debentures for application to the satisfaction
of the Obligations (and if any Debenture is not outstanding, pro-rata in proportion to the initial purchases of the remaining
Debentures).


 


(b) If
any Debtor shall become entitled to receive or shall receive any securities or other property (including, without limitation,
shares of Pledged Securities or instruments representing Pledged Securities acquired after the date hereof, or any options, warrants,
rights or other similar property or certificates representing a dividend, or any distribution in connection with any recapitalization,
reclassification or increase or reduction of capital, or issued in connection with any reorganization of such Debtor or any of
its direct or indirect subsidiaries) in respect of the Pledged Securities (whether as an addition to, in substitution of, or in
exchange for, such Pledged Securities or otherwise), such Debtor agrees to (i) accept the same as the agent of the Secured Parties;
(ii) hold the same in trust on behalf of and for the benefit of the Secured Parties; and (iii) to deliver any and all certificates
or instruments evidencing the same to Agent on or before the close of business on the fifth business day following the receipt
thereof by such Debtor, in the exact form received together with the Necessary Endorsements, to be held by Agent subject to the
terms of this Agreement as Collateral.


 




    	14 



    	 



    

 


8.
Rights and Remedies Upon Default.




 


(a) Upon
the occurrence of any Event of Default and at any time thereafter, the Secured Parties, acting through the Agent, shall have the
right to exercise all of the remedies conferred hereunder and under the Debentures, and the Secured Parties shall have all the
rights and remedies of a secured party under the UCC. Without limitation, the Agent, for the benefit of the Secured Parties, shall
have the following rights and powers:


 


(i) The
Agent shall have the right to take possession of the Collateral and, for that purpose, enter, with the aid and
assistance of any person, any premises where the Collateral, or any part thereof, is or may be placed and remove the same,
and each Debtor shall assemble the Collateral and make it available to the Agent at places which the Agent shall reasonably
select, whether at such Debtor’s premises or elsewhere, and make available to the Agent, without rent, all of such
Debtor’s respective premises and facilities for the purpose of the Agent taking possession of, removing or putting the
Collateral in saleable or disposable form.


 


(ii) Upon
notice to the Debtors by Agent, all rights of each Debtor to exercise the voting and other consensual rights which it would otherwise
be entitled to exercise and all rights of each Debtor to receive the dividends and interest which it would otherwise be authorized
to receive and retain, shall cease. Upon such notice, Agent shall have the right to receive, for the benefit of the Secured Parties,
any interest, cash dividends or other payments on the Collateral and, at the option of Agent, to exercise in such Agent’s
discretion all voting rights pertaining thereto. Without limiting the generality of the foregoing, Agent shall have the right
(but not the obligation) to exercise all rights with respect to the Collateral as it were the sole and absolute owner thereof,
including, without limitation, to vote and/or to exchange, at its sole discretion, any or all of the Collateral in connection
with a merger, reorganization, consolidation, recapitalization or other readjustment concerning or involving the Collateral or
any Debtor or any of its direct or indirect subsidiaries.


 


(iii) The
Agent shall have the right to operate the business of each Debtor using the Collateral and shall have the right to assign, sell,
lease or otherwise dispose of and deliver all or any part of the Collateral, at public or private sale or otherwise, either with
or without special conditions or stipulations, for cash or on credit or for future delivery, in such parcel or parcels and at
such time or times and at such place or places, and upon such terms and conditions as the Agent may deem commercially reasonable,
all without (except as shall be required by applicable statute and cannot be waived) advertisement or demand upon or notice to
any Debtor or right of redemption of a Debtor, which are hereby expressly waived. Upon each such sale, lease, assignment or other
transfer of Collateral, the Agent, for the benefit of the Secured Parties, may, unless prohibited by applicable law which cannot
be waived, purchase all or any part of the Collateral being sold, free from and discharged of all trusts, claims, right of redemption
and equities of any Debtor, which are hereby waived and released.


 




    	15 



    	 



    

 


(iv) The
Agent shall have the right (but not the obligation) to notify any account debtors and any obligors under instruments or accounts
to make payments directly to the Agent, on behalf of the Secured Parties, and to enforce the Debtors’ rights against such
account debtors and obligors.


 


(v) The
Agent, for the benefit of the Secured Parties, may (but is not obligated to) direct any financial intermediary or any other person
or entity holding any investment property to transfer the same to the Agent, on behalf of the Secured Parties, or its designee.


 


(vi) The
Agent may (but is not obligated to) transfer any or all Intellectual Property registered in the name of any Debtor at the United
States Patent and Trademark Office and/or Copyright Office into the name of the Secured Parties or any designee or any purchaser
of any Collateral.


 


(b) The
Agent shall comply with any applicable law in connection with a disposition of Collateral and such compliance will not be considered
adversely to affect the commercial reasonableness of any sale of the Collateral. The Agent may sell the Collateral without giving
any warranties and may specifically disclaim such warranties. If the Agent sells any of the Collateral on credit, the Debtors
will only be credited with payments actually made by the purchaser. In addition, each Debtor waives any and all rights that it
may have to a judicial hearing in advance of the enforcement of any of the Agent’s rights and remedies hereunder, including,
without limitation, its right following an Event of Default to take immediate possession of the Collateral and to exercise its
rights and remedies with respect thereto.


 


(c) For
the purpose of enabling the Agent to further exercise rights and remedies under this Section 8 or elsewhere provided by agreement
or applicable law, each Debtor hereby grants to the Agent, for the benefit of the Agent and the Secured Parties, an irrevocable,
nonexclusive license (exercisable without payment of royalty or other compensation to such Debtor) to use, license or sublicense
following an Event of Default, any Intellectual Property now owned or hereafter acquired by such Debtor, and wherever the same
may be located, and including in such license access to all media in which any of the licensed items may be recorded or stored
and to all computer software and programs used for the compilation or printout thereof.


 


9. Applications
of Proceeds. The proceeds of any such sale, lease or other disposition of the Collateral hereunder or from payments made on
account of any insurance policy insuring any portion of the Collateral shall be applied first, to the expenses of retaking, holding,
storing, processing and preparing for sale, selling, and the like (including, without limitation, any taxes, fees and other costs
incurred in connection therewith) of the Collateral, to the reasonable attorneys’ fees and expenses incurred by the Agent
in enforcing the Secured Parties’ rights hereunder and in connection with collecting, storing and disposing of the Collateral,
and then to satisfaction of the Obligations pro rata among the Secured Parties (based on then-outstanding principal amounts of
Debentures at the time of any such determination), and to the payment of any other amounts required by applicable law, after which
the Secured Parties shall pay to the applicable Debtor any surplus proceeds. If, upon the sale, license or other disposition of
the Collateral, the proceeds thereof are insufficient to pay all amounts to which the Secured Parties are legally entitled, the
Debtors will be liable for the deficiency, together with interest thereon, at the rate of 18% per annum or the lesser amount permitted
by applicable law (the “Default Rate”), and the reasonable fees of any attorneys employed by the Secured Parties
to collect such deficiency. To the extent permitted by applicable law, each Debtor waives all claims, damages and demands against
the Secured Parties arising out of the repossession, removal, retention or sale of the Collateral, unless due solely to the gross
negligence or willful misconduct of the Secured Parties as determined by a final judgment (not subject to further appeal) of a
court of competent jurisdiction.


 




    	16 



    	 



    

 


10. Securities
Law Provision. Each Debtor recognizes that Agent may be limited in its ability to effect a sale to the public of all or part
of the Pledged Securities by reason of certain prohibitions in the Securities Act of 1933, as amended, or other federal or state
securities laws (collectively, the “Securities Laws”), and may be compelled to resort to one or more sales
to a restricted group of purchasers who may be required to agree to acquire the Pledged Securities for their own account, for
investment and not with a view to the distribution or resale thereof. Each Debtor agrees that sales so made may be at prices and
on terms less favorable than if the Pledged Securities were sold to the public, and that Agent has no obligation to delay the
sale of any Pledged Securities for the period of time necessary to register the Pledged Securities for sale to the public under
the Securities Laws. Each Debtor shall cooperate with Agent in its attempt to satisfy any requirements under the Securities Laws
(including, without limitation, registration thereunder if requested by Agent) applicable to the sale of the Pledged Securities
by Agent.


 


11. Costs
and Expenses. Each Debtor agrees to pay all reasonable out-of-pocket fees, costs and expenses incurred in connection with
any filing required hereunder, including without limitation, any financing statements pursuant to the UCC, continuation statements,
partial releases and/or termination statements related thereto or any expenses of any searches reasonably required by the Agent.
The Debtors shall also pay all other claims and charges which in the reasonable opinion of the Agent is reasonably likely to prejudice,
imperil or otherwise affect the Collateral or the Security Interests therein. The Debtors will also, upon demand, pay to the Agent
the amount of any and all reasonable expenses, including the reasonable fees and expenses of its counsel and of any experts and
agents, which the Agent, for the benefit of the Secured Parties, may incur in connection with the creation, perfection, protection,
satisfaction, foreclosure, collection or enforcement of the Security Interest and the preparation, administration, continuance,
amendment or enforcement of this Agreement and pay to the Agent the amount of any and all reasonable expenses, including the reasonable
fees and expenses of its counsel and of any experts and agents, which the Agent, for the benefit of the Secured Parties, and the
Secured Parties may incur in connection with (i) the enforcement of this Agreement, (ii) the custody or preservation of, or the
sale of, collection from, or other realization upon, any of the Collateral, or (iii) the exercise or enforcement of any of the
rights of the Secured Parties under the Debentures. Until so paid, any fees payable hereunder shall be added to the principal
amount of the Debentures and shall bear interest at the Default Rate.


 




    	17 



    	 



    

 


12. Responsibility
for Collateral. The Debtors assume all liabilities and responsibility in connection with all Collateral, and the Obligations
shall in no way be affected or diminished by reason of the loss, destruction, damage or theft of any of the Collateral or its
unavailability for any reason. Without limiting the generality of the foregoing, (a) neither the Agent nor any Secured Party (i)
has any duty (either before or after an Event of Default) to collect any amounts in respect of the Collateral or to preserve any
rights relating to the Collateral, or (ii) has any obligation to clean-up or otherwise prepare the Collateral for sale, and (b)
each Debtor shall remain obligated and liable under each contract or agreement included in the Collateral to be observed or performed
by such Debtor thereunder. Neither the Agent nor any Secured Party shall have any obligation or liability under any such contract
or agreement by reason of or arising out of this Agreement or the receipt by the Agent or any Secured Party of any payment relating
to any of the Collateral, nor shall the Agent or any Secured Party be obligated in any manner to perform any of the obligations
of any Debtor under or pursuant to any such contract or agreement, to make inquiry as to the nature or sufficiency of any payment
received by the Agent or any Secured Party in respect of the Collateral or as to the sufficiency of any performance by any party
under any such contract or agreement, to present or file any claim, to take any action to enforce any performance or to collect
the payment of any amounts which may have been assigned to the Agent or to which the Agent or any Secured Party may be entitled
at any time or times.


 


13. Security
Interests Absolute. All rights of the Secured Parties and all obligations of the Debtors hereunder, shall be absolute and
unconditional, irrespective of: (a) any lack of validity or enforceability of this Agreement, the Debentures or any agreement
entered into in connection with the foregoing, or any portion hereof or thereof; (b) any change in the time, manner or place of
payment or performance of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any
consent to any departure from the Debentures or any other agreement entered into in connection with the foregoing; (c) any exchange,
release or nonperfection of any of the Collateral, or any release or amendment or waiver of or consent to departure from any other
collateral for, or any guarantee, or any other security, for all or any of the Obligations; (d) any action by the Secured Parties
to obtain, adjust, settle and cancel in its sole discretion any insurance claims or matters made or arising in connection with
the Collateral; or (e) any other circumstance which might otherwise constitute any legal or equitable defense available to a Debtor,
or a discharge of all or any part of the Security Interests granted hereby. Until the Obligations shall have been paid and performed
in full, the rights of the Secured Parties shall continue even if the Obligations are barred for any reason, including, without
limitation, the running of the statute of limitations or bankruptcy. Each Debtor expressly waives presentment, protest, notice
of protest, demand, notice of nonpayment and demand for performance. In the event that at any time any transfer of any Collateral
or any payment received by the Secured Parties hereunder shall be deemed by final order of a court of competent jurisdiction to
have been a voidable preference or fraudulent conveyance under the bankruptcy or insolvency laws of the United States, or shall
be deemed to be otherwise due to any party other than the Secured Parties, then, in any such event, each Debtor’s obligations
hereunder shall survive cancellation of this Agreement, and shall not be discharged or satisfied by any prior payment thereof
and/or cancellation of this Agreement, but shall remain a valid and binding obligation enforceable in accordance with the terms
and provisions hereof. Each Debtor waives all right to require the Secured Parties to proceed against any other person or entity
or to apply any Collateral which the Secured Parties may hold at any time, or to marshal assets, or to pursue any other remedy.
Each Debtor waives any defense arising by reason of the application of the statute of limitations to any obligation secured hereby.


 




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14. Term
of Agreement. This Agreement and the Security Interests shall terminate on the date on which all payments under the Debentures
have been indefeasibly paid in full and all other Obligations have been paid or discharged; provided, however, that all indemnities
of the Debtors contained in this Agreement (including, without limitation, Annex B hereto) shall survive and remain operative
and in full force and effect regardless of the termination of this Agreement.


 


15.
 Power of Attorney; Further Assurances.




 


(a) Each
Debtor authorizes the Agent, and does hereby make, constitute and appoint the Agent and its officers, agents, successors or assigns
with full power of substitution, as such Debtor’s true and lawful attorney-in-fact, with power, in the name of the Agent
or such Debtor, to, after the occurrence and during the continuance of an Event of Default, (i) endorse any note, checks, drafts,
money orders or other instruments of payment (including payments payable under or in respect of any policy of insurance) in respect
of the Collateral that may come into possession of the Agent; (ii) to sign and endorse any financing statement pursuant to the
UCC or any invoice, freight or express bill, bill of lading, storage or warehouse receipts, drafts against debtors, assignments,
verifications and notices in connection with accounts, and other documents relating to the Collateral; (iii) to pay or discharge
taxes, liens, security interests or other encumbrances at any time levied or placed on or threatened against the Collateral; (iv)
to demand, collect, receipt for, compromise, settle and sue for monies due in respect of the Collateral; (v) to transfer any Intellectual
Property or provide licenses respecting any Intellectual Property; and (vi) generally, at the option of the Agent, and at the
expense of the Debtors, at any time, or from time to time, to execute and deliver any and all documents and instruments and to
do all acts and things which the Agent deems necessary to protect, preserve and realize upon the Collateral and the Security Interests
granted therein in order to effect the intent of this Agreement and the Debentures all as fully and effectually as the Debtors
might or could do; and each Debtor hereby ratifies all that said attorney shall lawfully do or cause to be done by virtue hereof.
This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter as long
as any of the Obligations shall be outstanding. The designation set forth herein shall be deemed to amend and supersede any inconsistent
provision in the Organizational Documents or other documents or agreements to which any Debtor is subject or to which any Debtor
is a party. Without limiting the generality of the foregoing, after the occurrence and during the continuance of an Event of Default,
each Secured Party is specifically authorized to execute and file any applications for or instruments of transfer and assignment
of any patents, trademarks, copyrights or other Intellectual Property with the United States Patent and Trademark Office and the
United States Copyright Office.


 




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(b) On
a continuing basis, each Debtor will make, execute, acknowledge, deliver, file and record, as the case may be, with the proper
filing and recording agencies in any jurisdiction, including, without limitation, the jurisdictions indicated on Schedule C
attached hereto, all such instruments, and take all such action as may reasonably be deemed necessary or advisable, or as
reasonably requested by the Agent, to perfect the Security Interests granted hereunder and otherwise to carry out the intent and
purposes of this Agreement, or for assuring and confirming to the Agent the grant or perfection of a perfected security interest
in all the Collateral under the UCC.


 


(c) Each
Debtor hereby irrevocably appoints the Agent as such Debtor’s attorney- in-fact, with full authority in the place and instead
of such Debtor and in the name of such Debtor, from time to time in the Agent’s discretion, to take any action and to execute
any instrument which the Agent may deem necessary or advisable to accomplish the purposes of this Agreement, including the filing,
in its sole discretion, of one or more financing or continuation statements and amendments thereto, relative to any of the Collateral
without the signature of such Debtor where permitted by law, which financing statements may (but need not) describe the Collateral
as “all assets” or “all personal property” or words of like import, and ratifies all such actions taken
by the Agent. This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter
as long as any of the Obligations shall be outstanding.


 


16. Notices.
All notices, requests, demands and other communications hereunder shall be subject to the notice provision of the Purchase Agreement
(as such term is defined in the Debentures).


 


17. Other
Security. To the extent that the Obligations are now or hereafter secured by property other than the Collateral or by the
guarantee, endorsement or property of any other person, firm, corporation or other entity, then the Agent shall have the right,
in its sole discretion, to pursue, relinquish, subordinate, modify or take any other action with respect thereto, without in any
way modifying or affecting any of the Secured Parties’ rights and remedies hereunder.


 


18. Appointment
of Agent. The Secured Parties hereby appoint Oz Rey, LLC to act as their agent (“Agent”) for purposes of
exercising any and all rights and remedies of the Secured Parties hereunder. The Agent shall have the rights, responsibilities
and immunities set forth in Annex B hereto.


 


19.
 Miscellaneous.




 


(a) No
course of dealing between the Debtors and the Secured Parties, nor any failure to exercise, nor any delay in exercising, on the
part of the Secured Parties, any right, power or privilege hereunder or under the Debentures shall operate as a waiver thereof;
nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.


 




    	20 



    	 



    

 


(b) All
of the rights and remedies of the Secured Parties with respect to the Collateral, whether established hereby or by the Debentures
or by any other agreements, instruments or documents or by law shall be cumulative and may be exercised singly or concurrently.


 


(c) This
Agreement, together with the exhibits and schedules hereto, contain the entire understanding of the parties with respect to the
subject matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which
the parties acknowledge have been merged into this Agreement and the exhibits and schedules hereto. No provision of this Agreement
may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Debtors
and the Secured Parties holding 67% or more of the principal amount of Debentures then outstanding, or, in the case of a waiver,
by the party against whom enforcement of any such waived provision is sought.


 


(d) If
any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially
reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that
they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.


 


(e) No
waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof,
nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.


 


(f) This
Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Company
and the Guarantors may not assign this Agreement or any rights or obligations hereunder without the prior written consent of each
Secured Party (other than by merger). Any Secured Party may assign any or all of its rights under this Agreement to any Person
(as defined in the Purchase Agreement) to whom such Secured Party assigns or transfers any Obligations, provided such transferee
agrees in writing to be bound, with respect to the transferred Obligations, by the provisions of this Agreement that apply to
the “Secured Parties.”


 


(g) Each
party shall take such further action and execute and deliver such further documents as may be necessary or appropriate in order
to carry out the provisions and purposes of this Agreement.


 




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(h) Except
to the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, all questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Except to the extent
mandatorily governed by the jurisdiction or situs where the Collateral is located, each Debtor agrees that all proceedings concerning
the interpretations, enforcement and defense of the transactions contemplated by this Agreement and the Debentures (whether brought
against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the City of New York, Borough of Manhattan. Except to
the extent mandatorily governed by the jurisdiction or situs where the Collateral is located, each Debtor 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 proceeding, any claim that it is not personally subject to the jurisdiction
of any such court, that such proceeding is improper. Each party hereto hereby irrevocably waives personal service of process and
consents to process being served in any such proceeding by mailing a copy thereof via registered or certified mail or overnight
delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably waives,
to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.


 


(i) This
Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and,
all of which taken together shall constitute one and the same Agreement. This Agreement may be executed and delivered in original,
via DocuSign, RightSignature or any other comparable signature software, via facsimile or email with PDF attachment, or other
commercially acceptable electronic form, in any number of counterparts, each of which shall be deemed an original, and all of
which shall together constitute but one and the same instrument, which instrument shall for all purposes be sufficiently evidenced
by any such counterpart.


 


(j) All
Debtors shall jointly and severally be liable for the obligations of each Debtor to the Secured Parties hereunder.


 


(k) Each
Debtor shall indemnify, reimburse and hold harmless the Agent and the Secured Parties and their respective partners, members,
shareholders, officers, directors, employees and agents (and any other persons with other titles that have similar functions)
(collectively, “Indemnitees”) from and against any and all losses, claims, liabilities, damages, penalties,
suits, costs and expenses, of any kind or nature, (including fees relating to the cost of investigating and defending any of the
foregoing) imposed on, incurred by or asserted against such Indemnitee in any way related to or arising from or alleged to arise
from this Agreement or the Collateral, except any such losses, claims, liabilities, damages, penalties, suits, costs and expenses
which result from the gross negligence or willful misconduct of the Indemnitee as determined by a final, nonappealable decision
of a court of competent jurisdiction. This indemnification provision is in addition to, and not in limitation of, any other indemnification
provision in the Debentures, the Purchase Agreement (as such term is defined in the Debentures) or any other agreement, instrument
or other document executed or delivered in connection herewith or therewith.


 




    	22 



    	 



    

 


(l) Nothing
in this Agreement shall be construed to subject Agent or any Secured Party to liability as a partner in any Debtor or any if its
direct or indirect subsidiaries that is a partnership or as a member in any Debtor or any of its direct or indirect subsidiaries
that is a limited liability company, nor shall Agent or any Secured Party be deemed to have assumed any obligations under any
partnership agreement or limited liability company agreement, as applicable, of any such Debtor or any of its direct or indirect
subsidiaries or otherwise, unless and until any such Secured Party exercises its right to be substituted for such Debtor as a
partner or member, as applicable, pursuant hereto.


 


(m) To
the extent that the grant of the security interest in the Collateral and the enforcement of the terms hereof require the
consent, approval or action of any partner or member, as applicable, of any Debtor or any direct or indirect subsidiary of
any Debtor or compliance with any provisions of any of the Organizational Documents, the Debtors hereby grant such consent
and approval and waive any such noncompliance with the terms of said documents.


 


[SIGNATURE
PAGES FOLLOW]


 




    	23 



    	 



    

 


IN
WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be duly executed on the day and year first above written.


 


	COMPANY	 	SECURED
    PARTIES
	 	 	 
	Amergent
    Hospitality Group, Inc.	 	Oz
    Rey, LLC
	 	 	 	 	 
	By:	 	 	By:	 
	 	Michael
    D. Pruitt, Chief Executive Officer	 	 	Robert
    S. Hersch, Manager
	 	 	 	 	 
	AGENT	 	 	 
	 	 	 	 
	Oz
    Rey, LLC, as Agent	 	 	 
	 	 	 	 	 
	By:	 	 	 	 
	 	Robert
    S. Hersch, Manager	 	 	 


 


[SIGNATURE
PAGE OF GUARANTORS FOLLOWS]


 


 


[Signature Page For
Security Agreement]


 




    	 



    	 



    

 


GUARANTORS:


 


AMERICAN
ROADSIDE BURGERS, INC.


AMERICAN BURGER ALLY, LLC


AMERICAN BURGER MOREHEAD, LLC


AMERICAN BURGER PROSPERITY, LLC


AMERICAN
ROADSIDE BURGERS SMITHTOWN, INC.


BGR ACQUISITION, LLC


BGR
FRANCHISING, LLC


BGR OPERATIONS, LLC


BGR ACQUISITION 1, LLC


BGR ANNAPOLIS, LLC


BGR ARLINGTON, LLC


BGR COLUMBIA, LLC


BGR MICHIGAN
AVE, LLC


BGR MOSAIC, LLC


BGR
OLD KEENE MILL, LLC


BGR WASHINGTONIAN, LLC


CAPITOL BURGER, LLC


BT
BURGER ACQUISITION, LLC


BT’S
BURGERJOINT RIVERGATE LLC


BT’S BURGERJOINT SUN VALLEY, LLC


LBB ACQUISITION, LLC


CUARTO
LLC


LBB
ACQUISITION 1 LLC


LBB HASSALO LLC


LBB
PLATFORM LLC


LBB CAPITOL HILL LLC


LBB FRANCHISING LLC


LBB GREEN LAKE LLC


LBB LAKE OSWEGO LLC


LBB
MAGNOLIA PLAZA LLC


LBB
MULTNOMAH VILLAGE LLC


LBB PROGRESS RIDGE LLC


LBB
REA FARMS LLC


LBB WALLINGFORD LLC


LBB
DOWNTOWN PDX LLC


NOVENO LLC


OCTAVO
LLC


PRIMERO LLC


QUINTO LLC


SEGUNDO LLC


SEPTIMO LLC


SEXTO LLC


JANTZEN
BEACH WINGS, LLC


OREGON OWL’S NEST, LLC


WEST END WINGS LTD


 


	 	By:	 
	 	 	Michael
    D. Pruett, Chief Executive Officer


 


[Signature Page For
Security Agreement]


 




    	 



    	 



    

 


SCHEDULE
A


 


	Name	 	FEIN	 	Street	 	City	 	State	 	Zip
	Amergent
    Hospitality Group, Inc	 	84-4842958	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	Spark
    Team Associates, LLC	 	37-1930302	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	 	 	 	 	 	 	 	 	 	 	 
	American
    Roadside Burgers Smithtown, Inc.	 	 20-5448413	 	80
    East Main St	 	Smithtown	 	NY	 	11787
	American
    Roadside Ally, LLC	 	45
    2446662	 	440
    S Church St	 	Charlotte	 	NC	 	28202
	American
    Roadside Burgers, Inc.	 	35
    2190327	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	American
    Burger Morehead, LLC	 	47-1777947	 	1500C
    W Morehead St	 	Charlotte	 	NC	 	28208
	American
    Burger Prosperity, LLC	 	32-0515577	 	10012
    Benfield Road, Suite 306	 	Charlotte	 	NC	 	28269
	 	 	 	 	 	 	 	 	 	 	 
	BT’s
    Burgerjoint Rivergate, LLC	 	26-1644112	 	14130
    Rivergate Pkwy	 	Charlotte	 	NC	 	28273
	BT’s
    Burgerjoint Sun Valley, LLC	 	36-4769661	 	6455
    Old Monroe Trl	 	Indian
    Trail	 	NC	 	28079
	BT
    Burger Acquisition, LLC	 	47-3936733	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	 	 	 	 	 	 	 	 	 	 	 
	LBB
    1 Primero LLC	 	80-0642522	 	122
    NW 10th	 	Portland	 	OR	 	97208
	LBB
    2 Segundo LLC	 	27-4431942	 	3747
    N Mississippi	 	Portland	 	OR	 	97227
	LBB
    4 Cuarto LLC	 	45-2474420	 	1404
    Orchard St Suite B	 	Eugene	 	OR	 	97403
	LBB
    5 Quinto LLC	 	45-2831112	 	3810
    SE Division St	 	Portland	 	OR	 	97202
	LBB
    6 Sexto LLC	 	45-4154475	 	3704
    SW Bond Ave	 	Portland	 	OR	 	97239
	LBB
    7 Septimo LLC	 	45-5146614	 	930
    NW 23rd Ave #104	 	Portland	 	OR	 	97210
	LBB
    8 Octavo LLC	 	46-4080783	 	2028
    SE Hawthorne	 	Portland	 	OR	 	97214
	LBB
    9 Noveno LLC	 	46-5235313	 	2038
    NE Alberta St	 	Portland	 	OR	 	97211
	LBB
    Hassalo LLC	 	32-0497857	 	787
    NE Holladay St	 	Portland	 	OR	 	97232
	LBB
    Magnolia Plaza LLC	 	82-5071815	 	8301
    Magnolia Estates Drive	 	Cornelius	 	NC	 	28031
	LBB
    Platform LLC	 	32-0497827	 	940
    NE Orenco Station Loop	 	Hillsboro	 	OR	 	97124
	LBB
    Progress Ridge LLC	 	61-1795014	 	12345
    SW Horizon Blvd., Ste 41	 	Beaverton	 	OR	 	97007
	LBB
    Green Lake LLC	 	35-2569663	 	7130
    Woodlawn Ave. NE	 	Seattle	 	WA	 	98115
	LBB
    Rea Farms, LLC	 	82-2845858	 	9904
    Sandy Rock Place, Unit F	 	Charlotte	 	NC	 	28277
	LBB
    Lake Oswego, LLC	 	35-2612075	 	3
    Monroe Parkway, Suite 300T	 	Lake
    Oswego	 	OR	 	97035
	LBB
    Capitol Hill LLC	 	35-2584337	 	1200
    E Pike St	 	Seattle	 	WA	 	98122
	LBB
    Wallingford LLC	 	38-4028170	 	1329
    N 45th St, Ste 109	 	Seattle	 	WA	 	98103
	LBB
    Multnomah Village LLC	 	32-0535671	 	7707
    SW Capitol Hwy	 	Portland	 	OR	 	97219
	LBB
    Acquisition, LLC	 	47-5247886	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	LBB
    Acquisition 1, LLC (EB5)	 	81-2559880	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	 	 	 	 	 	 	 	 	 	 	 
	BGR
    Annapolis LLC	 	82-4594528	 	2101
    Somerville Road	 	Annapolis	 	MD	 	21401
	BGR
    Arlington, LLC	 	27-1929608	 	3129
    Lee Hwy	 	Arlington	 	VA	 	22201
	BGR
    Columbia LLC	 	 	 	6250
    Columbia Crossing, Suite D	 	Columbia	 	MD	 	21045
	BGR
    Old Keene Mill, LLC	 	27-3831509	 	8420
    Old Keene Mill Rd	 	Springfield	 	VA	 	22152-2302
	BGR
    Washingtonian, LLC	 	90-0794128	 	229
    Boardwalk Pl	 	Gaithersburg	 	MD	 	20878
	Capitol
    Burger, LLC	 	26-0619156	 	4827
    Fairmont Ave	 	Bethesda	 	MD	 	20814
	BGR
    Mosaic, LLC	 	32-0491101	 	2985
    District Ave	 	Fairfax	 	VA	 	22031
	BGR
    Michigan Ave LLC	 	32-0507686	 	655
    Michigan Ave NE	 	Washington	 	DC	 	20064
	 	 	 	 	 	 	 	 	 	 	 
	BGR
    Operations, LLC	 	27-0982078	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	BGR
    Franchising, LLC	 	27-0981957	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	BGR
    Acquisition, LLC	 	81-4057012	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	BGR
    Acquisition 1, LLC	 	35-2574024	 	7621
    Little Ave Ste 414	 	Charlotte	 	NC	 	28226
	 	 	 	 	 	 	 	 	 	 	 
	Jantzen
    Beach Wings, LLC	 	20-3572167	 	11875
    N Jantzen Dr	 	Portland	 	OR	 	97217
	Oregon
    Owl’s Nest, LLC	 	20-3573250	 	11875
    N Jantzen Dr	 	Portland	 	OR	 	97217
	 	 	 	 	 	 	 	 	 	 	 
	West
    End Wings LTD	 	 	 	1
    London Rd	 	Nottingham	 	UK	 	NG2
    3AS


 




    	 



    	 



    

 


SCHEDULE
B


None


 




    	 



    	 



    

 


SCHEDULE
C


 


None.


 




    	 



    	 



    

 


SCHEDULE
D


Legal
Names and Organizational Identification Numbers


 


	Name	 	Jurisdiction of Incorporation	 	Percent Owned	 	 	Organizational Identification Number	 
	CHANTICLEER HOLDINGS, INC.	 	DE, USA	 	 	 	 	 	 	 	 
	American Roadside Burgers, Inc.	 	DE, USA	 	 	100	%	 	 	     	 
	American Burger Ally, LLC	 	NC, USA	 	 	100	%	 	 	 	 
	American Burger Morehead, LLC	 	NC, USA	 	 	100	%	 	 	 	 
	American Burger Prosperity, LLC	 	NC, USA	 	 	50	%	 	 	 	 
	American Roadside Burgers Smithtown, Inc.	 	DE, USA	 	 	100	%	 	 	 	 
	BGR Acquisition, LLC	 	NC, USA	 	 	100	%	 	 	 	 
	BGR Franchising, LLC	 	VA, USA	 	 	100	%	 	 	 	 
	BGR Operations, LLC	 	VA, USA	 	 	100	%	 	 	 	 
	BGR Acquisition 1, LLC	 	NC, USA	 	 	100	%	 	 	 	 
	BGR Annapolis, LLC	 	MD, USA	 	 	100	%	 	 	 	 
	BGR Arlington, LLC	 	VA, USA	 	 	46	%	 	 	 	 
	BGR Columbia, LLC	 	MD, USA	 	 	100	%	 	 	 	 
	BGR Michigan Ave, LLC	 	DC, USA	 	 	100	%	 	 	 	 
	BGR Mosaic, LLC	 	VA, USA	 	 	100	%	 	 	 	 
	BGR Old Keene Mill, LLC	 	VA, USA	 	 	100	%	 	 	 	 
	BGR Washingtonian, LLC	 	MD, USA	 	 	46	%	 	 	 	 
	Capitol Burger, LLC	 	MD, USA	 	 	100	%	 	 	 	 
	BT Burger Acquisition, LLC	 	NC, USA	 	 	100	%	 	 	 	 
	BT’s Burgerjoint Rivergate LLC	 	NC, USA	 	 	100	%	 	 	 	 
	BT’s Burgerjoint Sun Valley, LLC	 	NC, USA	 	 	100	%	 	 	 	 
	LBB Acquisition, LLC	 	NC, USA	 	 	100	%	 	 	 	 
	Cuarto LLC	 	OR, USA	 	 	100	%	 	 	 	 
	LBB Acquisition 1 LLC	 	OR, USA	 	 	100	%	 	 	 	 
	LBB Hassalo LLC	 	OR, USA	 	 	80	%	 	 	 	 
	LBB Platform LLC	 	OR, USA	 	 	80	%	 	 	 	 
	LBB Capitol Hill LLC	 	WA, USA	 	 	50	%	 	 	 	 
	LBB Franchising LLC	 	NC, USA	 	 	100	%	 	 	 	 
	LBB Green Lake LLC	 	OR, USA	 	 	50	%	 	 	 	 
	LBB Lake Oswego LLC	 	OR, USA	 	 	100	%	 	 	 	 
	LBB Magnolia Plaza LLC	 	NC, USA	 	 	50	%	 	 	 	 
	LBB Multnomah Village LLC	 	OR, USA	 	 	50	%	 	 	 	 
	LBB Progress Ridge LLC	 	OR, USA	 	 	50	%	 	 	 	 
	LBB Rea Farms LLC	 	NC, USA	 	 	50	%	 	 	 	 
	LBB Wallingford LLC	 	WA, USA	 	 	50	%	 	 	 	 
	LBB Downtown PDX LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Noveno LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Octavo LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Primero LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Quinto LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Segundo LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Septimo LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Sexto LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Jantzen Beach Wings, LLC	 	OR, USA	 	 	100	%	 	 	 	 
	Oregon Owl’s Nest, LLC	 	OR, USA	 	 	100	%	 	 	 	 
	West End Wings LTD	 	United Kingdom	 	 	100	%	 	 	 	 



 




    	 



    	 



    

 


SCHEDULE
E


 


	 	LITTLE
    BIG BURGER
	 	BGR
    BURGERS GRILLED RIGHT
	 	BGR
    THE BURGER JOINT
	 	BGR
    THE BURGER JOINT ON TOUR
	 	American
    Roadside


 




    	 



    	 



    

 


SCHEDULE
F


Intellectual
Property


 





 




    	 



    	 



    

 


SCHEDULE
G


Account
Debtors


 


N/A


 




    	 



    	 



    

 


SCHEDULE
H


Pledged
Securities


 


	1.	Warrants
    to purchase shares of common stock of Chanticleer Holdings, Inc.


 




    	 



    	 



    

 


ANNEX
A


to


SECURITY


AGREEMENT


 


FORM
OF ADDITIONAL DEBTOR JOINDER


 


Security
Agreement dated as of                    ,
2020 made by


Amergent Hospitality Group, Inc.


and
its subsidiaries party thereto from time to time, as Debtors


to and in favor of


the
Secured Parties identified therein (the “Security Agreement”)


 


Reference
is made to the Security Agreement as defined above; capitalized terms used herein and not otherwise defined herein shall have
the meanings given to such terms in, or by reference in, the Security Agreement.


 


The
undersigned hereby agrees that upon delivery of this Additional Debtor Joinder to the Secured Parties referred to above, the undersigned
shall (a) be an Additional Debtor under the Security Agreement, (b) have all the rights and obligations of the Debtors under the
Security Agreement as fully and to the same extent as if the undersigned was an original signatory thereto and (c) be deemed to
have made the representations and warranties set forth therein as of the date of execution and delivery of this Additional Debtor
Joinder. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THE UNDERSIGNED SPECIFICALLY GRANTS TO THE SECURED PARTIES A SECURITY
INTEREST IN THE COLLATERAL AS MORE FULLY SET FORTH IN THE SECURITY AGREEMENT AND ACKNOWLEDGES AND AGREES TO THE WAIVER OF JURY
TRIAL PROVISIONS SET FORTH THEREIN.


 


Attached
hereto are supplemental and/or replacement Schedules to the Security Agreement, as applicable.


 


An
executed copy of this Joinder shall be delivered to the Secured Parties, and the Secured Parties may rely on the matters set forth
herein on or after the date hereof. This Joinder shall not be modified, amended or terminated without the prior written consent
of the Secured Parties.


 




    	 



    	 



    

 


IN
WITNESS WHEREOF, the undersigned has caused this Joinder to be executed in the name and on behalf of the undersigned.


 


Dated:


 




    	 



    	 



    

 


ANNEX
B


to


SECURITY


AGREEMENT


 


THE AGENT


 


1.
Appointment. The Secured Parties (all capitalized terms used herein and not otherwise defined shall have the respective
meanings provided in the Security Agreement to which this Annex B is attached (the “Agreement”)), by their
acceptance of the benefits of the Agreement, hereby designate Oz Rey, LLC ( “Agent”) as the Agent to act as
specified herein and in the Agreement. Each Secured Party shall be deemed irrevocably to authorize the Agent to take such action
on its behalf under the provisions of the Agreement and any other Transaction Document (as such term is defined in the Purchase
Agreement) and to exercise such powers and to perform such duties hereunder and thereunder as are specifically delegated to or
required of the Agent by the terms hereof and thereof and such other powers as are reasonably incidental thereto. The Agent may
perform any of its duties hereunder by or through its agents or employees.


 


2.
Nature of Duties. The Agent shall have no duties or responsibilities except those expressly set forth in the Agreement.
Neither the Agent nor any of its partners, members, shareholders, officers, directors, employees or agents shall be liable for
any action taken or omitted by it as such under the Agreement or hereunder or in connection herewith or therewith, be responsible
for the consequence of any oversight or error of judgment or answerable for any loss, unless caused solely by its or their gross
negligence or willful misconduct as determined by a final judgment (not subject to further appeal) of a court of competent jurisdiction.
The duties of the Agent shall be mechanical and administrative in nature; the Agent shall not have by reason of the Agreement
or any other Transaction Document a fiduciary relationship in respect of any Debtor or any Secured Party; and nothing in the Agreement
or any other Transaction Document, expressed or implied, is intended to or shall be so construed as to impose upon the Agent any
obligations in respect of the Agreement or any other Transaction Document except as expressly set forth herein and therein.


 


3.
Lack of Reliance on the Agent. Independently and without reliance upon the Agent, each Secured Party, to the extent it
deems appropriate, has made and shall continue to make (i) its own independent investigation of the financial condition and affairs
of the Company and its subsidiaries in connection with such Secured Party’s investment in the Debtors, the creation and
continuance of the Obligations, the transactions contemplated by the Transaction Documents, and the taking or not taking of any
action in connection therewith, and (ii) its own appraisal of the creditworthiness of the Company and its subsidiaries, and of
the value of the Collateral from time to time, and the Agent shall have no duty or responsibility, either initially or on a continuing
basis, to provide any Secured Party with any credit, market or other information with respect thereto, whether coming into its
possession before any Obligations are incurred or at any time or times thereafter. The Agent shall not be responsible to the Debtors
or any Secured Party for any recitals, statements, information, representations or warranties herein or in any document, certificate
or other writing delivered in connection herewith, or for the execution, effectiveness, genuineness, validity, enforceability,
perfection, collectability, priority or sufficiency of the Agreement or any other Transaction Document, or for the financial condition
of the Debtors or the value of any of the Collateral, or be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of the Agreement or any other Transaction Document, or the financial
condition of the Debtors, or the value of any of the Collateral, or the existence or possible existence of any default or Event
of Default under the Agreement, the Debentures or any of the other Transaction Documents.


 




    	 



    	 



    

 


4.
Certain Rights of the Agent. The Agent shall have the right to take any action with respect to the Collateral, on behalf
of all of the Secured Parties. To the extent practical, the Agent shall request instructions from the Secured Parties with respect
to any material act or action (including failure to act) in connection with the Agreement or any other Transaction Document, and
shall be entitled to act or refrain from acting in accordance with the instructions of a Majority in Interest; if such instructions
are not provided despite the Agent’s request therefor, the Agent shall be entitled to refrain from such act or taking such
action, and if such action is taken, shall be entitled to appropriate indemnification from the Secured Parties in respect of actions
to be taken by the Agent; and the Agent shall not incur liability to any person or entity by reason of so refraining. Without
limiting the foregoing, (a) no Secured Party shall have any right of action whatsoever against the Agent as a result of the Agent
acting or refraining from acting hereunder in accordance with the terms of the Agreement or any other Transaction Document, and
the Debtors shall have no right to question or challenge the authority of, or the instructions given to, the Agent pursuant to
the foregoing and (b) the Agent shall not be required to take any action which the Agent believes (i) could reasonably be expected
to expose it to personal liability or (ii) is contrary to this Agreement, the Transaction Documents or applicable law.


 


5.
Reliance. The Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram, radiogram, order or other document or telephone message
signed, sent or made by the proper person or entity, and, with respect to all legal matters pertaining to the Agreement and the
other Transaction Documents and its duties thereunder, upon advice of counsel selected by it and upon all other matters pertaining
to this Agreement and the other Transaction Documents and its duties thereunder, upon advice of other experts selected by it.
Anything to the contrary notwithstanding, the Agent shall have no obligation whatsoever to any Secured Party to assure that the
Collateral exists or is owned by the Debtors or is cared for, protected or insured or that the liens granted pursuant to the Agreement
have been properly or sufficiently or lawfully created, perfected, or enforced or are entitled to any particular priority.


 


6.
Indemnification. To the extent that the Agent is not reimbursed and indemnified by the Debtors, the Secured Parties
will jointly and severally reimburse and indemnify the Agent, in proportion to their initially purchased respective principal
amounts of Debentures, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against
the Agent in performing its duties hereunder or under the Agreement or any other Transaction Document, or in any way relating
to or arising out of the Agreement or any other Transaction Document except for those determined by a final judgment (not subject
to further appeal) of a court of competent jurisdiction to have resulted solely from the Agent’s own gross negligence or
willful misconduct. Prior to taking any action hereunder as Agent, the Agent may require each Secured Party to deposit with it
sufficient sums as it determines in good faith is necessary to protect the Agent for costs and expenses associated with taking
such action.


 




    	 



    	 



    

 


7.
Resignation by the Agent.


 


(a)
The Agent may resign from the performance of all its functions and duties under the Agreement and the other Transaction
Documents at any time by giving 30 days’ prior written notice (as provided in the Agreement) to the Debtors and the
Secured Parties. Such resignation shall take effect upon the appointment of a successor Agent pursuant to clauses (b) and (c)
below.


 


(b)
Upon any such notice of resignation, the Secured Parties, acting by a Majority in Interest, shall appoint a successor Agent hereunder.


 


(c)
If a successor Agent shall not have been so appointed within said 30-day period, the Agent shall then appoint a successor Agent
who shall serve as Agent until such time, if any, as the Secured Parties appoint a successor Agent as provided above. If a successor
Agent has not been appointed within such 30-day period, the Agent may petition any court of competent jurisdiction or may interplead
the Debtors and the Secured Parties in a proceeding for the appointment of a successor Agent, and all fees, including, but not
limited to, extraordinary fees associated with the filing of interpleader and expenses associated therewith, shall be payable
by the Debtors on demand.


 


8.
Rights with respect to Collateral. Each Secured Party agrees with all other Secured Parties and the Agent (i) that
it shall not, and shall not attempt to, exercise any rights with respect to its security interest in the Collateral, whether pursuant
to any other agreement or otherwise (other than pursuant to this Agreement), or take or institute any action against the Agent
or any of the other Secured Parties in respect of the Collateral or its rights hereunder (other than any such action arising from
the breach of this Agreement) and (ii) that such Secured Party has no other rights with respect to the Collateral other than as
set forth in this Agreement and the other Transaction Documents. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Agent and the retiring Agent shall be discharged from its duties and obligations under the Agreement. After
any retiring Agent’s resignation or removal hereunder as Agent, the provisions of the Agreement including this Annex B shall
inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent.


 




    	 



    	 



    

 


EXHIBIT
D


 


SUBSIDIARY
GUARANTEE


 


SUBSIDIARY
GUARANTEE, dated as of April 1, 2020 (this “Guarantee”), made by each of the signatories hereto (together with
any other entity that may become a party hereto as provided herein, the “Guarantors”), in favor of Oz Rey,
LLC, a Texas limited liability company (together with its permitted assigns, the “Purchasers”) to that certain
Securities Purchase Agreement, dated as of the date hereof, between Amergent Hospitality Group, Inc., a Delaware corporation (the
“Company”) and the Purchasers.


 


W
I T N E S S E T H:


 


WHEREAS,
pursuant to that certain Securities Purchase Agreement, dated as of the date hereof, by and between the Company and the Purchasers
(the “Purchase Agreement”), the Company has agreed to sell and issue to the Purchasers, and the Purchasers
have agreed to purchase from the Company the Debentures, subject to the terms and conditions set forth therein; and


 


WHEREAS,
each Guarantor will directly benefit from the extension of credit to the Company represented by the issuance of the Debentures;
and


 


NOW,
THEREFORE, in consideration of the premises and to induce the Purchasers to enter into the Purchase Agreement and to carry out
the transactions contemplated thereby, each Guarantor hereby agrees with the Purchasers as follows:


 


1.
Definitions. Unless otherwise defined herein, terms defined in the Purchase Agreement and used herein shall have the meanings
given to them in the Purchase Agreement. The words “hereof,” “herein,” “hereto” and “hereunder”
and words of similar import when used in this Guarantee shall refer to this Guarantee as a whole and not to any particular provision
of this Guarantee, and Section and Schedule references are to this Guarantee unless otherwise specified. The meanings given to
terms defined herein shall be equally applicable to both the singular and plural forms of such terms. The following terms shall
have the following meanings:


 


“Guarantee”
means this Subsidiary Guarantee, as the same may be amended, supplemented or otherwise modified from time to time.


 




    	 



    	 



    

 


“Obligations”
means, in addition to all other costs and expenses of collection incurred by Purchasers in enforcing any of such Obligations and/or
this Guarantee, all of the liabilities and obligations (primary, secondary, direct, contingent, sole, joint or several) due or
to become due, or that are now or may be hereafter contracted or acquired, or owing to, of the Company or any Guarantor to the
Purchasers, including, without limitation, all obligations under this Guarantee, the Debentures and any other instruments, agreements
or other documents executed and/or delivered in connection herewith or therewith, in each case, whether now or hereafter existing,
voluntary or involuntary, direct or indirect, absolute or contingent, liquidated or unliquidated, whether or not jointly owed
with others, and whether or not from time to time decreased or extinguished and later increased, created or incurred, and all
or any portion of such obligations or liabilities that are paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from any of the Purchasers as a preference, fraudulent transfer or otherwise as such obligations may be
amended, supplemented, converted, extended or modified from time to time. Without limiting the generality of the foregoing, the
term “Obligations” shall include, without limitation: (i) principal of, and interest on the Debentures and the loans
extended pursuant thereto; (ii) any and all other fees, indemnities, costs, obligations and liabilities of the Company or any
Guarantor from time to time under or in connection with this Guarantee, the Debentures and any other instruments, agreements or
other documents executed and/or delivered in connection herewith or therewith; and (iii) all amounts (including but not limited
to post-petition interest) in respect of the foregoing that would be payable but for the fact that the obligations to pay such
amounts are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving
the Company or any Guarantor.


 


2.
Guarantee.


 


(a)
Guarantee.


 


(i)
The Guarantors hereby, jointly and severally, unconditionally and irrevocably, guarantee to the Purchasers and their respective
successors, indorsees, transferees and assigns, the prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration or otherwise) of the Obligations.


 


(ii)
Anything herein or in any other Transaction Document to the contrary notwithstanding, the maximum liability of each Guarantor
hereunder and under the other Transaction Documents shall in no event exceed the amount which can be guaranteed by such Guarantor
under applicable federal and state laws, including laws relating to the insolvency of debtors, fraudulent conveyance or transfer
or laws affecting the rights of creditors generally (after giving effect to the right of contribution established in Section 2(b)).


 


(iii)
Each Guarantor agrees that the Obligations may at any time and from time to time exceed the amount of the liability of such Guarantor
hereunder without impairing the guarantee contained in this Section 2 or affecting the rights and remedies of the Purchasers hereunder.


 


(iv)
The guarantee contained in this Section 2 shall remain in full force and effect until all the Obligations and the obligations
of each Guarantor under the guarantee contained in this Section 2 shall have been satisfied by indefeasible payment in full.


 




    	2



    	 



    

 


(v)
No payment made by the Company, any of the Guarantors, any other guarantor or any other Person or received or collected by the
Purchasers from the Company, any of the Guarantors, any other guarantor or any other Person by virtue of any action or proceeding
or any set-off or appropriation or application at any time or from time to time in reduction of or in payment of the Obligations
shall be deemed to modify, reduce, release or otherwise affect the liability of any Guarantor hereunder which shall, notwithstanding
any such payment (other than any payment made by such Guarantor in respect of the Obligations or any payment received or collected
from such Guarantor in respect of the Obligations), remain liable for the Obligations up to the maximum liability of such Guarantor
hereunder until the Obligations are indefeasibly paid in full.


 


(vi)
Notwithstanding anything to the contrary in this Guarantee, with respect to any defaulted non-monetary Obligations the specific
performance of which by the Guarantors is not reasonably possible (e.g. the issuance of the Company’s Common Stock), the
Guarantors shall only be liable for making the Purchasers whole on a monetary basis for the Company’s failure to perform
such Obligations in accordance with the Transaction Documents.


 


(b)
Right of Contribution. Subject to Section 2(c), each Guarantor hereby agrees that to the extent that a Guarantor shall
have paid more than its proportionate share of any payment made hereunder, such Guarantor shall be entitled to seek and receive
contribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment. Each Guarantor’s
right of contribution shall be subject to the terms and conditions of Section 2(c). The provisions of this Section 2(b) shall
in no respect limit the obligations and liabilities of any Guarantor to the Purchasers and each Guarantor shall remain liable
to the Purchasers for the full amount guaranteed by such Guarantor hereunder.


 


(c)
No Subrogation. Notwithstanding any payment made by any Guarantor hereunder or any set-off or application of funds of any
Guarantor by the Purchasers, no Guarantor shall be entitled to be subrogated to any of the rights of the Purchasers against the
Company or any other Guarantor or any collateral security or guarantee or right of offset held by the Purchasers for the payment
of the Obligations, nor shall any Guarantor seek or be entitled to seek any contribution or reimbursement from the Company or
any other Guarantor in respect of payments made by such Guarantor hereunder, until all amounts owing to the Purchasers by the
Company on account of the Obligations are indefeasibly paid in full. If any amount shall be paid to any Guarantor on account of
such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by
such Guarantor in trust for the Purchasers, segregated from other funds of such Guarantor, and shall, forthwith upon receipt by
such Guarantor, be turned over to the Purchasers in the exact form received by such Guarantor (duly indorsed by such Guarantor
to the Purchasers, if required), to be applied against the Obligations, whether matured or unmatured, in such order as the Purchasers
may determine.


 


(d)
Amendments, Etc. With Respect to the Obligations. Each Guarantor shall remain obligated hereunder notwithstanding that,
without any reservation of rights against any Guarantor and without notice to or further assent by any Guarantor, any demand for
payment of any of the Obligations made by the Purchasers may be rescinded by the Purchasers and any of the Obligations continued,
and the Obligations, or the liability of any other Person upon or for any part thereof, or any collateral security or guarantee
therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended,
modified, accelerated, compromised, waived, surrendered or released by the Purchasers, and the Purchase Agreement and the other
Transaction Documents and any other documents executed and delivered in connection therewith may be amended, modified, supplemented
or terminated, in whole or in part, as the Purchasers may deem advisable from time to time, and any collateral security, guarantee
or right of offset at any time held by the Purchasers for the payment of the Obligations may be sold, exchanged, waived, surrendered
or released. The Purchasers shall have no obligation to protect, secure, perfect or insure any Lien at any time held by them as
security for the Obligations or for the guarantee contained in this Section 2 or any property subject thereto.


 




    	3



    	 



    

 


(e)
Guarantee Absolute and Unconditional. Each Guarantor waives any and all notice of the creation, renewal, extension or accrual
of any of the Obligations and notice of or proof of reliance by the Purchasers upon the guarantee contained in this Section 2
or acceptance of the guarantee contained in this Section 2; the Obligations, and any of them, shall conclusively be deemed to
have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the guarantee contained in
this Section 2; and all dealings between the Company and any of the Guarantors, on the one hand, and the Purchasers, on the other
hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon the guarantee contained in this
Section 2. Each Guarantor waives to the extent permitted by law diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon the Company or any of the Guarantors with respect to the Obligations. Each Guarantor understands
and agrees that the guarantee contained in this Section 2 shall be construed as a continuing, absolute and unconditional guarantee
of payment and performance without regard to (a) the validity or enforceability of the Purchase Agreement or any other Transaction
Document, any of the Obligations or any other collateral security therefor or guarantee or right of offset with respect thereto
at any time or from time to time held by the Purchasers, (b) any defense, set-off or counterclaim (other than a defense of payment
or performance or fraud by Purchasers) which may at any time be available to or be asserted by the Company or any other Person
against the Purchasers, or (c) any other circumstance whatsoever (with or without notice to or knowledge of the Company or such
Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of the Company for the Obligations,
or of such Guarantor under the guarantee contained in this Section 2, in bankruptcy or in any other instance. When making any
demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, the Purchasers may, but shall
be under no obligation to, make a similar demand on or otherwise pursue such rights and remedies as they may have against the
Company, any other Guarantor or any other Person or against any collateral security or guarantee for the Obligations or any right
of offset with respect thereto, and any failure by the Purchasers to make any such demand, to pursue such other rights or remedies
or to collect any payments from the Company, any other Guarantor or any other Person or to realize upon any such collateral security
or guarantee or to exercise any such right of offset, or any release of the Company, any other Guarantor or any other Person or
any such collateral security, guarantee or right of offset, shall not relieve any Guarantor of any obligation or liability hereunder,
and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Purchasers
against any Guarantor. For the purposes hereof, “demand” shall include the commencement and continuance of any legal
proceedings.


 




    	4



    	 



    

 


(f)
Reinstatement. The guarantee contained in this Section 2 shall continue to be effective, or be reinstated, as the case
may be, if at any time payment, or any part thereof, of any of the Obligations is rescinded or must otherwise be restored or returned
by the Purchasers upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Company or any Guarantor,
or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, the
Company or any Guarantor or any substantial part of its property, or otherwise, all as though such payments had not been made.


 


(g)
Payments. Each Guarantor hereby guarantees that payments hereunder will be paid to the Purchasers without set-off or counterclaim
in U.S. dollars at the address set forth or referred to in the Signature Pages to the Purchase Agreement.


 


3.
Representations and Warranties. Each Guarantor hereby makes the following representations and warranties to Purchasers
as of the date hereof:


 


(a)
Organization and Qualification. The Guarantor is an entity, duly incorporated or otherwise organized, validly existing
and in good standing under the laws of the applicable jurisdiction set forth on Schedule 1, with the requisite corporate, partnership,
limited liability company or other power and authority to own and use its properties and assets and to carry on its business as
currently conducted. The Guarantor has no subsidiaries other than those identified as such on the Disclosure Schedules to the
Purchase Agreement. The Guarantor is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction
in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure
to be so qualified or in good standing, as the case may be, could not, individually or in the aggregate, (x) adversely affect
the legality, validity or enforceability of any of this Guaranty in any material respect, (y) have a material adverse effect on
the results of operations, assets, prospects, or financial condition of the Guarantor or (z) adversely impair in any material
respect the Guarantor’s ability to perform fully on a timely basis its obligations under this Guaranty (a “Material
Adverse Effect”).


 


(b)
Authorization; Enforcement. The Guarantor has the requisite corporate, partnership, limited liability company or other
power and authority to enter into and to consummate the transactions contemplated by this Guaranty, and otherwise to carry out
its obligations hereunder. The execution and delivery of this Guaranty by the Guarantor and the consummation by it of the transactions
contemplated hereby have been duly authorized by all requisite corporate, partnership, limited liability company or other action
on the part of the Guarantor. This Guaranty has been duly executed and delivered by the Guarantor and constitutes the valid and
binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting
generally the enforcement of, creditors’ rights and remedies or by other equitable principles of general application.


 




    	5



    	 



    

 


(c)
No Conflicts. The execution, delivery and performance of this Guaranty by the Guarantor and the consummation by the Guarantor
of the transactions contemplated thereby do not and will not (i) conflict with or violate any provision of its certificate or
articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, constitute a default (or
an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Guarantor is a party, or (iii)
result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental
authority to which the Guarantor is subject (including Federal and State securities laws and regulations), or by which any material
property or asset of the Guarantor is bound or affected, except in the case of each of clauses (ii) and (iii), such conflicts,
defaults, terminations, amendments, accelerations, cancellations and violations as could not, individually or in the aggregate,
have or result in a Material Adverse Effect. The business of the Guarantor is not being conducted in violation of any law, ordinance
or regulation of any governmental authority.


 


(d)
Consents and Approvals. The Guarantor is not required to obtain any consent, waiver, authorization or order of, or make
any filing or registration with, any court or other federal, state, local, foreign or other governmental authority or other person
in connection with the execution, delivery and performance by the Guarantor of this Guaranty.


 


4.
Covenants.


 


(a)
Each Guarantor covenants and agrees with the Purchasers that, from and after the date of this Guarantee until the Obligations
shall have been indefeasibly paid in full, such Guarantor shall take, and/or shall refrain from taking, as the case may be, each
commercially reasonable action that is necessary to be taken or not taken, as the case may be, so that no Event of Default (as
defined in the Debentures) is caused by the failure to take such action or to refrain from taking such action by such Guarantor.


 


(b)
So long as any of the Obligations are outstanding, unless Purchasers holding at least 67% of the aggregate principal amount of
the then outstanding Debentures shall otherwise consent in writing, each Guarantor will not directly or indirectly on or after
the date of this Guarantee:


 


i.
enter into, create, incur, assume or suffer to exist any indebtedness for borrowed money of any kind, including but not limited
to, a guarantee, on or with respect to any of its property or assets now owned or hereafter acquired or any interest therein or
any income or profits therefrom;


 




    	6



    	 



    

 


ii.
enter into, create, incur, assume or suffer to exist any liens of any kind, on or with respect to any of its property or assets
now owned or hereafter acquired or any interest therein or any income or profits therefrom;


 


iii.
amend its certificate of incorporation, bylaws or other charter documents so as to adversely affect any rights of any Purchaser;


 


iv.
repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its securities
or debt obligations;


 


v.
pay cash dividends on any equity securities of the Company;


 


vi.
enter into any transaction with any Affiliate of the Guarantor which would be required to be disclosed in any public filing of
the Company with the Commission, unless such transaction is made on an arm’s-length basis and expressly approved by a majority
of the disinterested directors of the Company (even if less than a quorum otherwise required for board approval); or


 


vii.
enter into any agreement with respect to any of the foregoing.


 


5.
Miscellaneous.


 


(a)
Amendments in Writing. None of the terms or provisions of this Guarantee may be waived, amended, supplemented or otherwise
modified except in writing by the Purchasers.


 


(b)
Notices. All notices, requests and demands to or upon the Purchasers or any Guarantor hereunder shall be effected in the
manner provided for in the Purchase Agreement, provided that any such notice, request or demand to or upon any Guarantor shall
be addressed to such Guarantor at 7621 Little Avenue, Suite 414, Charlotte, NC 28226.


 


(c)
No Waiver By Course Of Conduct; Cumulative Remedies. The Purchasers shall not by any act (except by a written instrument
pursuant to Section 5(a)), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or
to have acquiesced in any default under the Transaction Documents or Event of Default. No failure to exercise, nor any delay in
exercising, on the part of the Purchasers, any right, power or privilege hereunder shall operate as a waiver thereof. No single
or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. A waiver by the Purchasers of any right or remedy hereunder on any one occasion shall
not be construed as a bar to any right or remedy which the Purchasers would otherwise have on any future occasion. The rights
and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights
or remedies provided by law.


 




    	7



    	 



    

 


(d)
Enforcement Expenses; Indemnification.


 


(i)
Each Guarantor agrees to pay, or reimburse the Purchasers for, all its costs and expenses incurred in collecting against such
Guarantor under the guarantee contained in Section 2 or otherwise enforcing or preserving any rights under this Guarantee and
the other Transaction Documents to which such Guarantor is a party, including, without limitation, the reasonable fees and disbursements
of counsel to the Purchasers.


 


(ii)
Each Guarantor agrees to pay, and to save the Purchasers harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp, excise, sales or other taxes which may be payable or determined to be payable in
connection with any of the transactions contemplated by this Guarantee.


 


(iii)
Each Guarantor agrees to pay, and to save the Purchasers harmless from, any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to the execution,
delivery, enforcement, performance and administration of this Guarantee to the extent the Company would be required to do so pursuant
to the Purchase Agreement.


 


(iv)
The agreements in this Section shall survive repayment of the Obligations and all other amounts payable under the Purchase Agreement
and the other Transaction Documents.


 


(e)
Successor and Assigns. This Guarantee shall be binding upon the successors and assigns of each Guarantor and shall inure
to the benefit of the Purchasers and their respective successors and assigns; provided that no Guarantor may assign, transfer
or delegate any of its rights or obligations under this Guarantee without the prior written consent of the Purchasers.


 


(f)
Set-Off. Each Guarantor hereby irrevocably authorizes the Purchasers at any time and from time to time while an Event of
Default under any of the Transaction Documents shall have occurred and be continuing, without notice to such Guarantor or any
other Guarantor, any such notice being expressly waived by each Guarantor, to set-off and appropriate and apply any and all deposits,
credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by the Purchasers to or for the credit or the account of such Guarantor, or any part thereof
in such amounts as the Purchasers may elect, against and on account of the obligations and liabilities of such Guarantor to the
Purchasers hereunder and claims of every nature and description of the Purchasers against such Guarantor, in any currency, whether
arising hereunder, under the Purchase Agreement, any other Transaction Document or otherwise, as the Purchasers may elect, whether
or not the Purchasers have made any demand for payment and although such obligations, liabilities and claims may be contingent
or unmatured. The Purchasers shall notify such Guarantor promptly of any such set-off and the application made by the Purchasers
of the proceeds thereof, provided that the failure to give such notice shall not affect the validity of such set-off and application.
The rights of the Purchasers under this Section are in addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Purchasers may have.


 




    	8



    	 



    

 


(g)
Counterparts. This Agreement may be executed and delivered in original, via DocuSign, RightSignature or any other comparable
signature software, via facsimile or email with PDF attachment, or other commercially acceptable electronic form, in any number
of counterparts, each of which shall be deemed an original, and all of which shall together constitute but one and the same instrument,
which instrument shall for all purposes be sufficiently evidenced by any such counterpart.


 


(h)
Severability. Any provision of this Guarantee which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision
in any other jurisdiction.


 


(i)
Section Headings. The Section headings used in this Guarantee are for convenience of reference only and are not to affect
the construction hereof or be taken into consideration in the interpretation hereof.


 


(j)
Integration. This Guarantee and the other Transaction Documents represent the agreement of the Guarantors and the Purchasers
with respect to the subject matter hereof and thereof, and there are no promises, undertakings, representations or warranties
by the Purchasers relative to subject matter hereof and thereof not expressly set forth or referred to herein or in the other
Transaction Documents.


 


(k)
Governing Laws. All questions concerning the construction, validity, enforcement and interpretation of this Guarantee shall
be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the
principles of conflicts of law thereof. Each of the Company and the Guarantors agree that all proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Guarantee (whether brought against a party hereto or its respective
affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state
and federal courts sitting in the City of New York, Borough of Manhattan. Each of the Company and the Guarantors 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 proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such proceeding is improper. Each party hereto hereby irrevocably waives personal service
of process and consents to process being served in any such proceeding by mailing a copy thereof via registered or certified mail
or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Guarantee
and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising
out of or relating to this Guarantee or the transactions contemplated hereby.


 




    	9



    	 



    

 


(l)
Acknowledgements. Each Guarantor hereby acknowledges that:


 


(i)
it has been advised by counsel in the negotiation, execution and delivery of this Guarantee and the other Transaction Documents
to which it is a party;


 


(ii)
the Purchasers have no fiduciary relationship with or duty to any Guarantor arising out of or in connection with this Guarantee
or any of the other Transaction Documents, and the relationship between the Guarantors, on the one hand, and the Purchasers, on
the other hand, in connection herewith or therewith is solely that of debtor and creditor; and


 


(iii)
no joint venture is created hereby or by the other Transaction Documents or otherwise exists by virtue of the transactions contemplated
hereby among the Guarantors and the Purchasers.


 


(m)
Additional Guarantors. The Company shall cause each of its subsidiaries formed or acquired on or subsequent to the date
hereof to become a Guarantor for all purposes of this Guarantee by executing and delivering an Assumption Agreement in the form
of Annex 1 hereto.


 


(n)
Release of Guarantors. Each Guarantor will be released from all liability hereunder concurrently with the indefeasible
repayment in full of all amounts owed under the Purchase Agreement, the Debentures and the other Transaction Documents.


 


(o)
WAIVER OF JURY TRIAL. EACH GUARANTOR AND, BY ACCEPTANCE OF THE BENEFITS
HEREOF, THE PURCHASERS, HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS GUARANTEE AND FOR ANY COUNTERCLAIM THEREIN.


 


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


 


(Signature
Pages Follow)


 




    	10



    	 



    

 


IN
WITNESS WHEREOF, each of the undersigned has caused this Guarantee to be duly executed and delivered as of the date first above
written.


 


AMERICAN
ROADSIDE BURGERS, INC.


AMERICAN BURGER ALLY, LLC


AMERICAN BURGER MOREHEAD, LLC


AMERICAN BURGER PROSPERITY, LLC


AMERICAN
ROADSIDE BURGERS SMITHTOWN, INC.


BGR
ACQUISITION, LLC


BGR FRANCHISING, LLC


BGR OPERATIONS, LLC


BGR ACQUISITION 1, LLC


BGR ANNAPOLIS, LLC


BGR ARLINGTON, LLC


BGR COLUMBIA,
LLC


BGR MICHIGAN AVE, LLC


BGR MOSAIC, LLC


BGR
OLD KEENE MILL, LLC


BGR WASHINGTONIAN, LLC


CAPITOL BURGER, LLC


BT
BURGER ACQUISITION, LLC


BT’S
BURGERJOINT RIVERGATE LLC


BT’S BURGERJOINT SUN VALLEY, LLC


LBB ACQUISITION, LLC


CUARTO
LLC


LBB
ACQUISITION 1 LLC


LBB HASSALO LLC


LBB
PLATFORM LLC


LBB CAPITOL HILL LLC


LBB FRANCHISING LLC


LBB GREEN LAKE LLC


LBB LAKE OSWEGO LLC


LBB
MAGNOLIA PLAZA LLC


LBB
MULTNOMAH VILLAGE LLC


LBB PROGRESS RIDGE LLC


LBB
REA FARMS LLC


LBB WALLINGFORD LLC


LBB
DOWNTOWN PDX LLC


NOVENO LLC


OCTAVO
LLC


PRIMERO LLC


QUINTO LLC


SEGUNDO LLC


SEPTIMO LLC


SEXTO LLC


JANTZEN
BEACH WINGS, LLC


OREGON OWL’S NEST, LLC


WEST END WINGS LTD


 


	 	By:	 
	 	 	Michael
    D. Pruett, Chief Executive Officer


 


[SIGNATURE
PAGE SUBSIDIARY
GUARANTEE]


 




    	 



    	 



    

 


SCHEDULE
1


 


GUARANTORS


 


The
following are the names, notice addresses and jurisdiction of organization of each Guarantor.


 


 


	Name	 	Jurisdiction of Incorporation	 	Percent Owned	 
	CHANTICLEER HOLDINGS, INC.	 	DE, USA	 	 	 
	 	 	 	 	 	 
	American Roadside Burgers, Inc.	 	DE, USA	 	 	100	%
	American Burger Ally, LLC	 	NC, USA	 	 	100	%
	American Burger Morehead, LLC	 	NC, USA	 	 	100	%
	American Burger Prosperity, LLC	 	NC, USA	 	 	50	%
	American Roadside Burgers Smithtown, Inc.	 	DE, USA	 	 	100	%
	BGR Acquisition, LLC	 	NC, USA	 	 	100	%
	BGR Franchising, LLC	 	VA, USA	 	 	100	%
	BGR Operations, LLC	 	VA, USA	 	 	100	%
	BGR Acquisition 1, LLC	 	NC, USA	 	 	100	%
	BGR Annapolis, LLC	 	MD, USA	 	 	100	%
	BGR Arlington, LLC	 	VA, USA	 	 	46	%
	BGR Columbia, LLC	 	MD, USA	 	 	100	%
	BGR Michigan Ave, LLC	 	DC, USA	 	 	100	%
	BGR Mosaic, LLC	 	VA, USA	 	 	100	%
	BGR Old Keene Mill, LLC	 	VA, USA	 	 	100	%
	BGR Washingtonian, LLC	 	MD, USA	 	 	46	%
	Capitol Burger, LLC	 	MD, USA	 	 	100	%
	BT Burger Acquisition, LLC	 	NC, USA	 	 	100	%
	BT’s Burgerjoint Rivergate LLC	 	NC, USA	 	 	100	%
	BT’s Burgerjoint Sun Valley, LLC	 	NC, USA	 	 	100	%
	LBB Acquisition, LLC	 	NC, USA	 	 	100	%
	Cuarto LLC	 	OR, USA	 	 	100	%
	LBB Acquisition 1 LLC	 	OR, USA	 	 	100	%
	LBB Hassalo LLC	 	OR, USA	 	 	80	%
	LBB Platform LLC	 	OR, USA	 	 	80	%
	LBB Capitol Hill LLC	 	WA, USA	 	 	50	%
	LBB Franchising LLC	 	NC, USA	 	 	100	%
	LBB Green Lake LLC	 	OR, USA	 	 	50	%
	LBB Lake Oswego LLC	 	OR, USA	 	 	100	%
	LBB Magnolia Plaza LLC	 	NC, USA	 	 	50	%
	LBB Multnomah Village LLC	 	OR, USA	 	 	50	%
	LBB Progress Ridge LLC	 	OR, USA	 	 	50	%
	LBB Rea Farms LLC	 	NC, USA	 	 	50	%
	LBB Wallingford LLC	 	WA, USA	 	 	50	%
	LBB Downtown PDX LLC	 	OR, USA	 	 	100	%
	Noveno LLC	 	OR, USA	 	 	100	%
	Octavo LLC	 	OR, USA	 	 	100	%
	Primero LLC	 	OR, USA	 	 	100	%
	Quinto LLC	 	OR, USA	 	 	100	%
	Segundo LLC	 	OR, USA	 	 	100	%
	Septimo LLC	 	OR, USA	 	 	100	%
	Sexto LLC	 	OR, USA	 	 	100	%
	Jantzen Beach Wings, LLC	 	OR, USA	 	 	100	%
	Oregon Owl’s Nest, LLC	 	OR, USA	 	 	100	%
	West End Wings LTD	 	United Kingdom	 	 	100	%



 


[SIGNATURE
PAGE SUBSIDIARY
GUARANTEE]


 




    	 



    	 



    

 


Annex
1 to


SUBSIDIARY
GUARANTEE


 


ASSUMPTION
AGREEMENT, dated as of _____     __, ______ made by ______________________, a ______________ corporation (the
“Additional Guarantor”), in favor of the Purchasers pursuant to the Purchase Agreement referred to below.
All capitalized terms not defined herein shall have the meaning ascribed to them in such Purchase Agreement.


 


W
I T N E S S E T H :


 


WHEREAS,
Amergent Hospitality Group, Inc., a Delaware corporation (the “Company”) and the Purchasers have entered into
a Securities Purchase Agreement, dated as of ________, 2020 (as amended, supplemented or otherwise modified from time to
time, the “Purchase Agreement”);


 


WHEREAS,
in connection with the Purchase Agreement, the Subsidiaries of the Company (other than the Additional Guarantor) have entered
into the Subsidiary Guarantee, dated as of ________, 20 (as amended, supplemented or otherwise modified from time to time, the
“Guarantee”) in favor of the Purchasers;


 


WHEREAS,
the Purchase Agreement requires the Additional Guarantor to become a party to the Guarantee; and


 


WHEREAS,
the Additional Guarantor has agreed to execute and deliver this Assumption Agreement in order to become a party to the Guarantee;


 


NOW,
THEREFORE, IT IS AGREED:


 


1.
Guarantee. By executing and delivering this Assumption Agreement, the Additional Guarantor, as provided in Section 5(m)
of the Guarantee, hereby becomes a party to the Guarantee as a Guarantor thereunder with the same force and effect as if originally
named therein as a Guarantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and
liabilities of a Guarantor thereunder. The information set forth in Annex 1 hereto is hereby added to the information set forth
in Schedule 1 to the Guarantee. The Additional Guarantor hereby represents and warrants that each of the representations and warranties
contained in Section 3 of the Guarantee is true and correct on and as the date hereof as to such Additional Guarantor (after giving
effect to this Assumption Agreement) as if made on and as of such date.


 


2.
Governing Law. THIS ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW
OF THE STATE OF NEW YORK.


 


[SIGNATURE
PAGE SUBSIDIARY
GUARANTEE]


 




    	 



    	 



    

 


IN
WITNESS WHEREOF, the undersigned has caused this Assumption Agreement to be duly executed and delivered as of the date first above
written.


 


	[ADDITIONALGUARANTOR]	 
	 	                                       	 
	By:	 	 
	Name:	 	 
	Title:	 	 


 


[SIGNATURE
PAGE SUBSIDIARY
GUARANTEE]


 




    	 



    	 



    

 


Exhibit
E


 


NEITHER
THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE 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 SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND
THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
SECURED BY SUCH SECURITIES.


 


COMMON
STOCK PURCHASE WARRANT


 


AMERGENT
HOSPITALITY GROUP, INC.


 


Warrant
Shares


 


THIS
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received, Oz Rey, LLC or its assigns
(the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after April 1, 2020 (the “Initial Exercise Date”) and on or prior to the close
of business on the ten (10) year anniversary of the Issue Date (the “Termination Date”) but not thereafter,
to subscribe for and purchase from Amergent Hospitality Group, Inc., a Delaware corporation (the “Company”),
up to _______ shares (as subject to adjustment hereunder, the “Warrant Shares”) of Common Stock. The purchase
price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).


 


Section
1. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain
Securities Purchase Agreement (the “Purchase Agreement”), dated April 1, 2020, among the Company and the purchasers
signatory thereto.


 


Section
2. Exercise.


 


a)
Exercise of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any
time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company or the Transfer
Agent (or such other office or agency that the Company may designate by notice in writing to the registered Holder at the address
of the Holder appearing on the books of the Company), as applicable, of a duly executed facsimile copy or PDF copy submitted by
electronic (or e- mail attachment) of the Notice of Exercise in the form annexed hereto (“Notice of Exercise”).
Within the earlier of (i) three (3) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period
(as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise
Price for the shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United
States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise.
No ink- original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization)
of any Notice of Exercise form be required. Notwithstanding anything herein to the contrary, the Holder shall not be required
to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder
and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation
within three (3) Trading Days of the date the final Notice of Exercise is delivered to the Company. Partial exercises of this
Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of
lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant
Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date
of such purchases. The Company shall deliver any objection to any Notice of Exercise within two (2) Business Days of receipt of
such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions
of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available
for purchase hereunder at any given time may be less than the amount stated on the face hereof.


 




    	 



    	 



    

 


b)
Exercise Price. The exercise price per share of the Common Stock under this Warrant shall be $______, subject to
adjustment hereunder (the “Exercise Price”).


 


c)
Cashless Exercise. This Warrant may also be exercised, in whole or in part, at such time by means of a “cashless
exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by
dividing [(A-B) (X)] by (A), where:


 


	 	(A)
    	=
    	as
    applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice
    of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both
    executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours”
    (as defined in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii)
    at the option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice
    of Exercise or (z) the Bid Price of the Common Stock on the principal Trading Market as reported by Bloomberg L.P. as of the
    time of the Holder’s execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular
    trading hours” on a Trading Day and is delivered within two (2) hours thereafter pursuant to Section 2(a) hereof or
    (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and
    such Notice of Exercise is both executed and delivered pursuant to Section 1(a) hereof after the close of “regular trading
    hours” on such Trading Day; 
	 	 	 	 
	 	(B)
    	=
    	the
    Exercise Price of this Warrant, as adjusted hereunder; and
	 	 	 	 
	 	(X)
    	=	the
number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if
such exercise were by means of a cash exercise rather than a cashless exercise.


 




    	2



    	 



    

 


If
Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9)
of the Securities Act, the Warrant Shares shall take on the characteristics of the Warrants being exercised, and the holding period
of the Warrant Shares being issued may be tacked on to the holding period of this Warrant. The Company agrees not to take any
position contrary to this Section 2(c).


 


“Bid
Price” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common
Stock is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX
as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common
Stock are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d)
in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the Purchasers of a majority in interest of the Debentures then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.


 


“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX
as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common
Stock are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d)
in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the Purchasers of a majority in interest of the Debentures then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.


 




    	3



    	 



    

 


Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise
pursuant to this Section 2(c).


 


d)
Mechanics of Exercise.


 


i.
Delivery of Warrant Shares Upon Exercise. Warrant Shares purchased hereunder shall be transmitted by the Transfer Agent
to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust
Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or
resale of the Warrant Shares by the Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale
limitations pursuant to Rule 144, and otherwise by physical delivery of a certificate, registered in the Company’s share
register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant
to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earlier of (i) the earlier
of (A) three (3) Trading Days after the delivery to the Company of the Notice of Exercise and (B) one (1) Trading Day after delivery
of the aggregate Exercise Price to the Company and (ii) the number of Trading Days comprising the Standard Settlement Period after
the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon
delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record
of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant
Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within
the earlier of (i) three Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period following
delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to
a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and
not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date
of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading Day after such
liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are
delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST
program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period”
means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with
respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise.


 




    	4



    	 



    

 


ii.
Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request
of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder
a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which
new Warrant shall in all other respects be identical with this Warrant.


 


iii.
Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant
to Section 2(d)(i) by the Warrant Share Delivery Date (subject to receipt of the aggregate exercise price for the applicable exercise
(other than in the case of a Cashless Exercise)), then the Holder will have the right to rescind such exercise.


 


iv.
Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available
to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with
the provisions of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date (subject to receipt
of the aggregate Exercise Price for the applicable exercise (other than in the case of a Cashless Exercise)), and if after such
date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage
firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which
the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to
the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any)
for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that
the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell
order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion
of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall
be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued had the Company
timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having
a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with an aggregate
sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company
shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall
limit a 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 shares
of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.


 




    	5



    	 



    

 


v.
No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price or round up to the next whole share.


 


vi.
Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer
tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid
by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that in the event that Warrant Shares are to be issued in a name other than the
name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly
executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for
any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same- day processing of any Notice
of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions)
required for same-day electronic delivery of the Warrant Shares.


 


vii.
Closing of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise
of this Warrant, pursuant to the terms hereof.


 


Section
3. Certain Adjustments.


 


a)
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or
otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company
upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
(including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by
reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price
shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares,
if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding
immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted
such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a)
shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend
or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.


 




    	6



    	 



    

 


b)
Anti-Dilution Protection.


 


(i)
Sale at less than Exercise Price. If the Company shall at any time or from time to time, issue, sell or otherwise dispose
of any additional shares of Common Stock (including shares owned or held by or for the account of the Company), however designated
(other than shares of Common Stock excepted from the provisions of this Section 3(b) by subsection (v) or otherwise covered by
Sections 3(a), 3(c) or 3(d)) without consideration or for a net consideration per share less than the Exercise Price in effect
immediately prior to such issuance, then, and in each such case: (a) the Exercise Price shall be lowered to the price (but in
no event below $.0001 per share) determined by dividing (i) an amount equal to the sum of (x) the number of shares of Common Stock
outstanding immediately prior to such issue or sale multiplied by the then existing Exercise Price, and (y) the consideration,
if any, received by the Corporation upon such issue or sale, by (ii) the sum of the total number of shares of Common Stock outstanding
immediately prior to such issue or sale plus the number of shares of Common Stock so issued and sold; and (b) the holder of this
Warrant shall thereafter, on the exercise hereof, be entitled to receive the Warrant Shares determined by multiplying the Warrant
Shares which would be issuable on such exercise immediately prior to such issuance by the fraction of which (i) the numerator
is the Exercise Price in effect immediately prior to such issuance and (ii) the denominator is the Exercise Price in effect on
the date of such exercise.


 


(ii)
Sale at less than VWAP. If the Company shall at any time or from time to time, issue, sell or otherwise dispose of any
additional shares of Common Stock (including shares owned or held by or for the account of the Company), however designated (other
than shares of Common Stock excepted from the provisions of this Section 3(b) by subsection (v) or otherwise covered by Sections
3(a), 3(c) or 3(d)) for a net consideration per share more than the Exercise Price but less than the VWAP for the five Trading
Days immediately prior to such issuance, then, and in each such case: (a) the Exercise Price shall be lowered to the price determined
by multiplying the Exercise Price by a fraction determined by dividing (i) an amount equal to the sum of (x) the number of shares
of Common Stock outstanding immediately prior to such issue or sale multiplied by the VWAP for the five Trading Days immediately
prior to such issuance, and (y) the consideration, if any, received by the Corporation upon such issue or sale, by (ii) (x) the
total number of shares of Common Stock outstanding immediately prior to such issue or sale plus the number of shares of Common
Stock so issued and sold multiplied by (y) the VWAP for the five Trading Days immediately prior to such issuance; and (b) the
holder of this Warrant shall thereafter, on the exercise hereof, be entitled to receive the Warrant Shares determined by multiplying
the Warrant Shares which would be issuable on such exercise immediately prior to such issuance by the fraction of which (i) the
numerator is the Exercise Price in effect immediately prior to such issuance and (ii) the denominator is the Exercise Price in
effect on the date of such exercise.


 




    	7



    	 



    

 


(iii)
Definitions, etc. For purposes of this Section 3: The issuance of any warrants, options or other subscription or purchase
rights with respect to shares of Common Stock and the issuance of any securities convertible into or exchangeable for such shares
of Common Stock (or the issuance of any warrants, options or any rights with respect to such convertible or exchangeable securities)
shall be deemed an issuance at such time of such Common Stock if the Net Consideration Per Share which may be received by the
Company for such Common Stock (as hereinafter determined) shall be less than the Exercise Price at the time of such issuance or
the VWAP for the five Trading Days immediately prior to such issuance and, except as hereinafter provided, an adjustment in the
Exercise Price and the number of shares of Common Stock issuable upon exercise of this Warrant shall be made upon each such issuance
in the manner provided in subsection (i). Any obligation, agreement or undertaking to issue warrants, options, or other subscription
or purchase rights at any time in the future shall be deemed to be an issuance at the time such obligation, agreement or undertaking
is made or arises. Except as otherwise provided herein, no adjustment of the Exercise Price and the number of shares of Common
Stock issuable upon exercise of this Warrant shall be made under subsection (i) upon the issuance of any shares of Common Stock
which are issued pursuant to the exercise of any warrants, options or other subscription or purchase rights or pursuant to the
exercise of any conversion or exchange rights in any convertible securities if any adjustment shall previously have been made
upon the issuance of any such warrants, options or other rights or upon the issuance of any convertible securities (or upon the
issuance of any warrants, options or any rights therefor) as above provided. Any adjustment of the Exercise Price and the number
of shares of Common Stock issuable upon exercise of this Warrant with respect to this subsection (ii) which relates to warrants,
options or other subscription or purchase rights with respect to shares of Common Stock shall be disregarded if, as, and when
the respective warrant, option or other subscription or purchase rights expire or are cancelled without being exercised, so that
the Exercise Price effective immediately upon such cancellation or expiration shall be equal to the Exercise Price in effect at
the time of the issuance of the expired or cancelled warrants, options or other subscriptions or purchase rights, with such additional
adjustments as would have been made to that Exercise Price had the expired or cancelled warrants, options or other subscriptions
or purchase rights not been issued. For purposes of this subsection (ii), the “Net Consideration Per Share” which
may be received by the Company shall be determined as follows:


 


(A)
The “Net Consideration Per Share” shall mean the amount equal to the total amount of consideration, if any, received
by the Company for the issuance of such warrants, options, subscriptions, or other purchase rights or convertible or exchangeable
securities, plus the minimum amount of consideration, if any, payable to the Company upon exercise or conversion thereof, divided
by the aggregate number of shares of Common Stock that would be issued if all such warrants, options, subscriptions, or other
purchase rights or convertible or exchangeable securities were exercised, exchanged or converted.


 


(B)
If the “Net Consideration Per Share” which may be received by the Company shall change (other than under or by reason
of provisions designed to protect against dilution), the Exercise Price in effect at the time of such event shall forthwith be
readjusted to the Exercise Price which would have been in effect at such time had such warrants, options, subscriptions, or other
purchase rights or convertible or exchangeable securities provided for such changed “Net Consideration Per Share”
at the time initially granted, issued or sold, but only if as a result of such adjustment the Exercise Price then in effect hereunder
is thereby reduced. If the “Net Consideration Per Share” shall be reduced at any time under or by reason of provisions
designed to protect against dilution, then in case of the delivery of Common Stock upon the exercise or conversion of any such
warrants, options, subscriptions, or other purchase rights or convertible or exchangeable securities, the Exercise Price then
in effect hereunder shall forthwith be adjusted to such amount as would have obtained had such warrant, option, subscription,
or other purchase right or convertible or exchangeable security never been issued as to such Common Stock and had adjustments
been made upon the issuance of the Common Stock delivered as aforesaid, but only if as a result of such adjustment the Exercise
Price then in effect hereunder is thereby reduced.


 


For
purposes of this Section 3(c), if a part or all of the consideration received by the Company in connection with the issuance of
shares of the Common Stock or the issuance of any of the securities described in this Section 3(c), consists of property other
than cash, such consideration shall be deemed to have the same value as shall be determined in good faith by the board of directors
of the Company, without deduction of any expenses incurred or any underwriting commissions or concessions paid or allowed by the
Company in connection therewith.


 




    	8



    	 



    

 


This
subsection (ii) shall not apply under any of the circumstances described in Sections 3(a), 3(c) or 3(d).


 


(iv)
Dilution in Case of Other Securities. In case any securities other than shares of stock of the Company shall be issued
or sold, or shall become subject to issue upon the conversion or exchange of any shares of stock of the Company (or any other
person referred to in Section 5) or subscription, purchase or other acquisition pursuant to any rights or options granted by the
Company (or such other person), for a consideration per share such as to dilute the purchase rights evidenced by this Warrant,
the computations, adjustments and readjustments provided for in this Section (c) with respect to the Exercise Price and the number
of shares of Common stock issuable upon exercise of this Warrant shall be made as nearly as possible in the manner so provided
and applied to determine the amount of other securities from time to time receivable on the exercise of the Warrants, so as to
protect the holders of the Warrants against the effect of such dilution.


 


(v)
Certain Issues of Common Stock. Anything herein to the contrary notwithstanding, the Company shall not be required to make
any adjustment to the Exercise Price in the case of:


 


(A)
the issuance of Common Stock pursuant to any security outstanding on the Original Issue Date, including Series 2 Preferred Stock;


 


(B)
the issuance of Common Stock pursuant to any officers, directors, employees or consultants pursuant to an equity incentive compensation
plan approved by the Board of Directors.


 


c)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company
grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata
to all record holders of any class of shares 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 exercise of this Warrant immediately
before 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.


 


d)
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend
or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock as a class, 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)
(a “Distribution”), at any time after the issuance of this Warrant, then, in each such case, the Holder shall
be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder
had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant immediately before the date of
which a record is taken for such Distribution, 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 participation in such Distribution.


 




    	9



    	 



    

 


e)
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in
one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange
offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell,
tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of
the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification,
reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in
one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without
limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby
such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common
Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making
or party to, such stock or share purchase agreement or other business combination) (each a “Fundamental Transaction”),
then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would
have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the
Holder, the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving
corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result of such
Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately
prior to such Fundamental Transaction. For purposes of any such exercise, the determination of the Exercise Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share
of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration
in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of
Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the
Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following
such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is
not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under
this Warrant and the other Transaction Documents in accordance with the provisions of this Section 3(e) pursuant to written agreements
in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such
Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security
of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is
exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to
the shares of Common Stock acquirable and receivable upon exercise of this Warrant prior to such Fundamental Transaction, and
with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the
relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital
stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of
this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form
and substance to the Holder. Upon the occurrence of any such 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 Warrant 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 Warrant and the other Transaction
Documents with the same effect as if such Successor Entity had been named as the Company herein.


 




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f)
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share,
as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as
of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.


 


g)
Notice to Holder.


 


i.
Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the
Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment
and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.


 


ii.
Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or
purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall
be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a
party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby
the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary
dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered
by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register
of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating
(x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants,
or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend,
distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation,
merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that
holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure
to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action
required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material,
non-public information regarding the Company or any of the Subsidiaries, the Company shall promptly file such notice with the
Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period
commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly
set forth herein.


 




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Section
4. Transfer of Warrant.


 


a)
Transferability. Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d)
hereof and to the provisions of Section 4.1 of the Purchase Agreement, this Warrant and all rights hereunder (including, without
limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office
of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached
hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making
of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants
in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument
of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this
Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically
surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender
this Warrant to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning
this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase
of Warrant Shares without having a new Warrant issued.


 


b)
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office
of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued,
signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved
in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or
Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated
the original Issue Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.


 


c)
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose
(the “Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and
treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution
to the Holder, and for all other purposes, absent actual notice to the contrary.


 


d) Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the
transfer of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the
Securities Act and under applicable state securities or blue sky laws or (ii) eligible for resale without volume or
manner-of-sale restrictions or current public information requirements pursuant to Rule 144, the Company may require, as a
condition of allowing such transfer, that the Holder or transferee of this Warrant, as the case may be, comply with the
provisions of Section 5.7 of the Purchase Agreement.


 


e)
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a
view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable
state securities law, except pursuant to sales registered or exempted under the Securities Act.


 


Section
5. Miscellaneous.


 


a)
No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other
rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth
in Section 3.


 




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b)
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case
of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate,
if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation,
in lieu of such Warrant or stock certificate.


 


c)
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right
required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next
succeeding Business Day.


 


d)
Authorized Shares. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized
and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of
any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full
authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase
rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares
may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading
Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise
of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and
payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free
from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer
occurring contemporaneously with such issue). Except and to the extent as waived or consented to by the Holder, the Company shall
not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer
of assets, consolidation, merger, 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 Warrant, but will at all times in good faith assist in the carrying
out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder
as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase
the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in
par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to
obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be,
necessary to enable the Company to perform its obligations under this Warrant. Before taking any action which would result in
an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall
obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body
or bodies having jurisdiction thereof.


 




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e)
Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall
be determined in accordance with the provisions of the Purchase Agreement.


 


f)
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered
and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities
laws.


 


g)
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder
shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies, notwithstanding
the fact that all rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with
any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts
as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including
those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing
any of its rights, powers or remedies hereunder.


 


h)
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company
shall be delivered in accordance with the notice provisions of the Purchase Agreement.


 


i)
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability
of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted
by the Company or by creditors of the Company.


 


j)
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not
be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees
to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.


 


k)
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby
shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted
assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant
and shall be enforceable by the Holder or holder of Warrant Shares.


 




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l)
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company
and the Holder.


 


m)
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions
or the remaining provisions of this Warrant.


 


n)
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be
deemed a part of this Warrant.


 


o)
Acceptance. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and
conditions contained herein.


 


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


 


(Signature
Page Follows)


 




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IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first
above indicated.


 


AMERGENT
HOSPITALITY GROUP, INC.


 


	By:	 	 
	 	Michael
    D. Pruitt, Chief Executive Officer	 


 




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NOTICE
OF EXERCISE


 


TO:
AMERGENT HOSPITALITY GROUP, INC.


 


(1)
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant
(only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer
taxes, if any.


 


(2)
Payment shall take the form of (check applicable box):


 


[  ]
in lawful money of the United States; or


 


[  ]
[if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise
procedure set forth in subsection 2(c).


 


(3)
Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:


 


 ___________________________________


 


The
Warrant Shares shall be delivered to the following DWAC Account Number:


 ___________________________________


 ___________________________________


 ___________________________________


 


(4)
Accredited Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under
the Securities Act of 1933, as amended.


 


[SIGNATURE
OF HOLDER]


 


Name
of Investing Entity:


______________________________________________________________________________________________


 


Signature
of Authorized Signatory of Investing Entity:


_________________________________________________________________


 


Name
of Authorized Signatory:


________________________________________________________________________________


 


Title
of Authorized Signatory:


__________________________________________________________________________________


 


Date:





______________________________________________________________________________________________


 




    	17



    	 



    

 


EXHIBIT
B


 


ASSIGNMENT
FORM


 


(To
assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)


 


FOR
VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to


 


	Name:	 
	 	(Please
    Print)
	 	 
	Address:	 
	 	(Please
    Print)
	 	 
	Phone
    Number:	 
	 	 
	Email
    Address:	 


 


Dated:


_____________
___,


_______





 


	Holder’s
    Signature: 	 	 
	 	 	 
	Holder’s
    Address:	 	 


 




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