Exhibit 4.7


 





THESE SECURITIES HAVE NOT BEEN
REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY APPLICABLE STATE SECURITIES LAWS 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 COMPLIANCE WITH APPLICABLE STATE
SECURITIES LAWS OR BLUE SKY LAWS.


 


UNLESS PERMITTED UNDER SECURITIES
LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (I)
THE ISSUE DATE AND (II) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.


 


FENNEC PHARMACEUTICALS
INC.


 


SENIOR SECURED
CONVERTIBLE NOTE


 


	Issuance Date: September 23, 2022	Original Principal Amount: U.S. $20,000,000



 


FOR VALUE RECEIVED,
Fennec Pharmaceuticals Inc., a British Columbia corporation (the “Company”), hereby promises to pay to Petrichor
Opportunities Fund I LP or its registered assigns (the “Holder”) in cash the amount set out above as the Original
Principal Amount (as (x) reduced pursuant to the terms hereof pursuant to redemption, conversion or otherwise, and (y) increased from
time to time by the aggregate amount of PIK Interest that shall have been added to the outstanding principal amount of this Note pursuant
to Section 2.2, the “Principal”) when due, whether upon the Maturity Date, acceleration, redemption or otherwise
(in each case in accordance with the terms hereof), to pay cash interest (“Cash Interest”) on any outstanding
Principal at the Cash Interest Rate from the date set out above as the Issuance Date (the “Issuance Date”) until
the same becomes due and payable, whether upon an Interest Date, the Maturity Date, acceleration, conversion, redemption or otherwise
(in each case in accordance with the terms hereof), and to pay paid-in-kind interest (“PIK Interest”, and together
with Cash Interest, collectively, “Interest”) on any outstanding Principal at a rate of 3.50% per annum from
the Issuance Date until the earlier of (A) August 19, 2024, and (B) the date the same becomes due and payable, whether upon an Interest
Date, the Maturity Date, acceleration, conversion, redemption or otherwise (in each case in accordance with the terms hereof). This Senior
Secured Convertible Note (including all Senior Secured Convertible Notes issued in exchange, transfer or replacement hereof, this “Note”)
is one of a series of Senior Secured Convertible Notes issued pursuant to the Securities Purchase Agreement on the Issuance Date and referred
to in the Securities Purchase Agreement as the Second Closing Notes (collectively, the “Notes” and such other
Senior Secured Convertible Notes issued pursuant to the Securities Purchase Agreement on the Issuance Date and referred to in the Securities
Purchase Agreement as the Second Closing Notes, the “Other Notes”). Certain capitalized terms used herein are
defined in Section 32.


 


1.                  
Payments of Principal. On the Maturity Date, the Company shall pay to the Holder an amount in cash equal to (i) the
product of all outstanding Principal multiplied by the Redemption Premium as of the Maturity Date, plus (ii) all accrued and unpaid Interest
and accrued and unpaid Late Charges on such Principal and Interest. Other than as specifically permitted by this Note, the Company may
not prepay any portion of the outstanding Principal, accrued and unpaid Interest, or accrued and unpaid Late Charges on Principal or Interest,
if any. Notwithstanding anything herein to the contrary, with respect to any repayment, conversion or redemption hereunder, as applicable,
the Company shall repay, convert or redeem, as applicable, (i) first, all accrued and unpaid Interest hereunder and under any other
Notes held by such Holder, (ii) second, all accrued and unpaid Late Charges on any Principal and Interest hereunder and under any
other Notes held by such Holder, (iii) third, all other amounts (other than Principal, but including any Redemption Premium) outstanding
under any other Notes held by such Holder, and (v) fourth, all Principal outstanding hereunder and under any other Notes held by
such Holder, in each case, allocated pro rata among this Note and such other Notes held by such Holder.


 






    	 	1	 



     


    

 


2.                  
Interest.


 


2.1              
Cash Interest. Cash Interest on this Note shall commence accruing on the Issuance Date at the Cash Interest Rate and shall
be computed on the basis of a 360-day year and the actual number of days elapsed per month and shall be payable in arrears for each Calendar
Quarter on the first (1st) Business Day of each Calendar Quarter after the Issuance Date (each, an “Interest Date”).
Cash Interest shall be payable on each Interest Date, to the record holder of this Note on the applicable Interest Date, by wire transfer
of immediately available funds pursuant to wire instructions provided by the Holder in writing to the Company. Prior to the payment of
Cash Interest on an Interest Date, Cash Interest on this Note shall accrue at the Cash Interest Rate and be payable by way of inclusion
of the Interest in the Conversion Amount in connection with any conversion of this Note under Section 3, on each Redemption Date and/or
in connection with any required payment upon any Bankruptcy Event of Default.


 


2.2              
PIK Interest. PIK Interest on this Note shall commence accruing on the Issuance Date at a rate of 3.50% per annum and shall
be computed on the basis of a 360-day year and the actual number of days elapsed per month and shall be payable in arrears for each Calendar
Quarter on each Interest Date; provided, that (x) PIK Interest shall cease to accrue on this Note on August 19, 2024, and (y) from and
after August 19, 2024, no further PIK Interest shall accrue on this Note (provided, that, any PIK Interest that shall have accrued on
this Note prior to August 19, 2024 shall remain outstanding and be payable hereunder as set forth herein. Any accrued PIK Interest shall
be payable in kind on each Interest Date, to the record holder of this Note on the applicable Interest Date, by capitalizing such PIK
Interest and, effective as of such Interest Date, adding it to (and thereby increasing) the outstanding Principal of this Note. For the
avoidance of doubt, effective as of, and from and after, any Interest Date, the outstanding Principal of this Note shall be increased
by the amount of PIK Interest paid in kind on such Interest Date for all purposes of this Note (including, without limitation, for the
purposes of the future accrual of Interest on the outstanding Principal of this Note and for the purposes of determining the Conversion
Amount as of any date). Prior to the payment in kind of PIK Interest on an Interest Date, PIK Interest on this Note shall, until August
19, 2024, accrue at a rate of 3.50% per annum and be payable by way of inclusion of the Interest in the Conversion Amount in connection
with any conversion of this Note under Section 3, on each Redemption Date and/or in connection with any required payment upon any Bankruptcy
Event of Default.


 


3.                  
Conversion of Notes. At any time after the Issuance Date, this Note shall be convertible into validly issued, fully
paid and non-assessable shares of Common Shares, on the terms and conditions set forth in this Section 3.


 


3.1              
Conversion Right. Subject to the provisions of Section 3.4, at any time or times on or after the Issuance Date, the Holder
shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common
Shares in accordance with Section 3.3, at the Conversion Rate. The Company shall not issue any fraction of a share of Common Shares upon
any conversion. If the issuance would result in the issuance of a fraction of a share of Common Shares, the Company shall round such fraction
of a share of Common Shares up to the nearest whole share. The Company shall pay any and all transfer, stamp and similar taxes, costs
and expenses (including, without limitation, fees and expenses of the transfer agent of the Company (the “Transfer Agent”))
that may be payable with respect to the issuance and delivery of Common Shares upon conversion of any Conversion Amount.


 






    	 	2	 



     


    

 


3.2              
Conversion Rate. The number of shares of Common Shares issuable upon conversion of any Conversion Amount pursuant to Section
3 shall be determined by dividing (x) such Conversion Amount by (y) the Conversion Price (the “Conversion Rate”).


 


3.3              
Mechanics of Conversion.


 


(a)               
Optional Conversion.


 


1.                  
To convert any Conversion Amount into shares of Common Shares on any date (a “Conversion Date”), the
Holder shall deliver (whether via facsimile, electronic mail or otherwise), for receipt on or prior to 11:59 p.m., New York time, on such
date, a copy of an executed notice of conversion in the form attached hereto as Exhibit I (the “Conversion Notice”)
to the Company.


 


2.                  
On or before the second (2nd) Trading Day following the date of receipt of a Conversion Notice, the Company shall transmit
by facsimile or electronic mail the transfer agent instructions and representation as to whether such shares of Common Shares may then
be resold pursuant to (A) an effective and available registration statement, (B) Rule 144, provided that the Holder affirmatively indicates
on the applicable Conversion Notice that the shares of Common Shares issuable in connection with such Conversion Notice have been or are
being resold either prior to or contemporaneously with the date of the applicable Conversion Notice by the Holder, or (C) Rule 144 without
having to comply with the information requirements under Rule 144(c)(1) (each, a “Permitted Securities Transaction”),
in the form attached hereto as Exhibit II, to the Holder and the Transfer Agent which shall instruct the Transfer Agent to process
such Conversion Notice in accordance with the terms herein.


 


3.                  
On or before the third (3rd) Trading Day following the date on which the Company has received a Conversion Notice (the “Share
Delivery Deadline”), the Company shall (1) provided that the Transfer Agent is participating in The Depository Trust Company’s
(“DTC”) Fast Automated Securities Transfer Program, with respect to the shares of Common Shares included in
the Conversion Notice that may then be resold by the Holder pursuant to a Permitted Securities Transaction, credit such aggregate number
of shares of Common Shares to which the Holder shall be entitled pursuant to such conversion to the Holder’s or its designee’s
balance account with DTC through its Deposit/Withdrawal at Custodian system or (2) if the Transfer Agent is not participating in the DTC
Fast Automated Securities Transfer Program or with respect to the shares of Common Shares included in the Conversion Notice that may not
then be resold by the Holder pursuant to a Permitted Securities Transaction, a certificate, registered in the name of the Holder or its
designee, for the number of shares of Common Shares to which the Holder shall be entitled pursuant to such conversion.


 






    	 	3	 



     


    

 


4.                  
The Person or Persons entitled to receive the shares of Common Shares issuable upon a conversion of this Note shall be treated
for all purposes as the record holder or holders of such shares of Common Shares on the Conversion Date.


 


5.                  
Notwithstanding anything to the contrary contained in this Note or the Securities Purchase Agreement, after the effective date
of the Registration Statement, the Company shall cause the Transfer Agent to deliver unlegended shares of Common Stock to the Holder (or
its designee) in connection with any sale of Registrable Securities with respect to which the Holder has entered into a contract for sale,
and delivered a copy of the prospectus included as part of the particular Registration Statement to the extent applicable, and for which
the Holder has not yet settled.


 


(b)               
Reserved.


 


(c)               
Registration; Book-Entry. The Company shall maintain a register (the “Register”) for the recordation
of the names and addresses of the holders of each Note and the principal amount of the Notes held by such holders (the “Registered
Notes”). The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Company
and the holders of the Notes shall treat each Person whose name is recorded in the Register as the owner of a Note for all purposes (including,
without limitation, the right to receive payments of Principal and Interest hereunder) notwithstanding notice to the contrary. A Registered
Note may be assigned, transferred or sold in whole or in part only by registration of such assignment or sale on the Register. Upon its
receipt of a written request to assign, transfer or sell all or part of any Registered Note by the holder thereof, the Company shall record
the information contained therein in the Register and issue one or more new Registered Notes in the same aggregate principal amount as
the principal amount of the surrendered Registered Note to the designated assignee or transferee pursuant to Section 18, provided
that if the Company does not so record an assignment, transfer or sale (as the case may be) of all or part of any Registered Note within
two (2) Business Days of such a request, then the Register shall be automatically deemed updated to reflect such assignment, transfer
or sale (as the case may be). Notwithstanding anything to the contrary set forth in this Section 3, following conversion of any portion
of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Company. The
Holder and the Company shall maintain records showing the Principal, Interest and Late Charges converted and/or paid (as the case may
be) and the dates of such conversions and/or payments (as the case may be) or shall use such other method, reasonably satisfactory to
the Holder and the Company, so as not to require physical surrender of this Note upon conversion. If the Company does not update the Register
to record such Principal, Interest and Late Charges converted and/or paid (as the case may be) and the dates of such conversions, and/or
payments (as the case may be) within two (2) Business Days of such occurrence, then the Register shall be automatically deemed updated
to reflect such occurrence.


 


(d)               
Pro Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from more than one holder of Notes
for the same Conversion Date and the Company can convert some, but not all, of such portions of the Notes submitted for conversion, the
Company, subject to Section 3.4, shall convert from each holder of Notes electing to have Notes converted on such date a pro rata amount
of such holder’s portion of its Notes submitted for conversion based on the principal amount of Notes submitted for conversion on
such date by such holder relative to the aggregate principal amount of all Notes submitted for conversion on such date. In the event of
a dispute as to the number of shares of Common Shares issuable to the Holder in connection with a conversion of this Note, the Company
shall issue to the Holder the number of shares of Common Shares not in dispute and resolve such dispute in accordance with Section 23.


 






    	 	4	 



     


    

 


3.4              
Limitations on Conversions. The Company shall not effect the conversion of any portion of this Note, and the Holder shall
not have the right to convert any portion of this Note pursuant to the terms and conditions of this Note and any such conversion shall
be null and void and treated as if never made, to the extent that after giving effect to such conversion, the Holder together with the
other Attribution Parties collectively would beneficially own in excess of 4.99% (the “Maximum Percentage”)
of the shares of Common Shares outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence,
the aggregate number of shares of Common Shares beneficially owned by the Holder and the other Attribution Parties shall include the number
of shares of Common Shares held by the Holder and all other Attribution Parties plus the number of shares of Common Shares issuable upon
conversion of this Note with respect to which the determination of such sentence is being made, but shall exclude shares of Common Shares
which would be issuable upon (A) conversion of the remaining, nonconverted portion of this Note beneficially owned by the Holder or any
of the other Attribution Parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of
the Company (including, without limitation, any convertible notes or convertible preferred shares or warrants) beneficially owned by the
Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained in this
Section 3.4. For purposes of this Section 3.4, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange
Act. For purposes of determining the number of outstanding shares of Common Shares the Holder may acquire upon the conversion of this
Note without exceeding the Maximum Percentage, the Holder may rely on the number of outstanding shares of Common Shares as reflected in
(x) the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public
filing with the SEC, as the case may be, (y) a more recent public announcement by the Company or (z) any other written notice by the Company
or the Transfer Agent, if any, setting forth the number of shares of Common Shares outstanding (the “Reported Outstanding
Share Number”). If the Company receives a Conversion Notice from the Holder at a time when the actual number of outstanding
shares of Common Shares is less than the Reported Outstanding Share Number, the Company shall notify the Holder in writing of the number
of shares of Common Shares then outstanding and, to the extent that such Conversion Notice would otherwise cause the Holder’s beneficial
ownership, as determined pursuant to this Section 3.4, to exceed the Maximum Percentage, the Holder must notify the Company of a reduced
number of shares of Common Shares to be purchased pursuant to such Conversion Notice. For any reason at any time, upon the written or
oral request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to the Holder
the number of shares of Common Shares then outstanding. In any case, the number of outstanding shares of Common Shares shall be determined
after giving effect to the conversion or exercise of securities of the Company, including this Note, by the Holder and any other Attribution
Party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance of shares of Common
Shares to the Holder upon conversion of this Note results in the Holder and the other Attribution Parties being deemed to beneficially
own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common Shares (as determined under Section
13(d) of the Exchange Act), the number of shares so issued by which the Holder’s and the other Attribution Parties’ aggregate
beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and
shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the Excess Shares. Upon delivery of a written
notice to the Company, the Holder may from time to time increase (with such increase not effective until the sixty-first (61st)
day after delivery of such notice) or decrease the Maximum Percentage to any other percentage as specified in such notice; provided that
(i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is
delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the other Attribution Parties and not
to any other holder of Notes that is not an Attribution Party of the Holder. For purposes of clarity, the shares of Common Shares issuable
pursuant to the terms of this Note in excess of the Maximum Percentage shall not be deemed to be beneficially owned by the Holder for
any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the Exchange Act. No prior inability to convert this Note pursuant
to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination
of convertibility. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity
with the terms of this Section 3.4 to the extent necessary to correct this paragraph (or any portion of this paragraph) which may be defective
or inconsistent with the intended beneficial ownership limitation contained in this Section 3.4 or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived and shall apply
to a successor holder of this Note.


 






    	 	5	 



     


    

 


3.5              
Redemption Automatic Conversion. In the event that a Redemption Automatic Conversion shall occur pursuant to Section 8.1(c)(iii)
upon the occurrence of an Automatic Conversion Event, then, for the purposes of effecting the conversion of the applicable Company Optional
Redemption Amount into shares of Common Shares in respect of such Redemption Automatic Conversion, such conversion shall be consummated
in the manner set forth in this Section 3 as though the Holder had delivered a Conversion Notice under Section 3.3(a)(1) with respect
to (x) a Conversion Amount equal to the applicable Company Optional Redemption Amount and (y) a Conversion Date of the Company Optional
Redemption Date. Any such Redemption Automatic Conversion shall otherwise be consummated in the manner, and subject to the provisions
and limitations, set forth in this Section 3.


 


4.                  
Rights Upon and Event of Default.


 


4.1              
Event of Default. Unless waived in writing by the Holder, each of the following events shall constitute an “Event
of Default” and each of the events in clauses (i), (j) and (k) below shall constitute a “Bankruptcy Event of
Default”:


 


(a)               
to the extent that a Registration Statement is required to be filed with the SEC pursuant to the terms of the Securities Purchase
Agreement, the failure of such Registration Statement to be filed with the SEC on or prior to the date that is five (5) days after the
applicable Filing Date or the failure of such Registration Statement to be declared effective by the SEC on or prior to the date that
is five (5) days after the applicable Effectiveness Date;


 


(b)               
to the extent that a Registration Statement is required to be filed with the SEC pursuant to the terms of the Securities Purchase
Agreement, while such Registration Statement is required to be maintained effective pursuant to the terms of the Securities Purchase Agreement,
the effectiveness of such Registration Statement lapses for any reason (including, without limitation, the issuance of a stop order) or
such Registration Statement (or the prospectus contained therein) is unavailable to any holder of Registrable Securities for sale of all
of such holder’s Registrable Securities in accordance with the terms of the Securities Purchase Agreement, and such lapse or unavailability
continues for a period of five (5) consecutive days or for more than an aggregate of ten (10) days in any 365-day period;


 






    	 	6	 



     


    

 


(c)               
the suspension from trading or the failure of the Common Shares to be quoted or listed (as applicable) on an Eligible Market for
a period of five (5) consecutive Trading Days;


 


(d)               
the Company’s (A) failure to deliver to the Holder the required number of shares of Common Shares within five (5) Trading
Days after the applicable Conversion Date or (B) notice, written or oral, to any holder of the Notes, including, without limitation, by
way of public announcement or through any of its agents, at any time, of its intention not to comply, as required, with a request for
conversion of any Notes into shares of Common Shares that is requested in accordance with the provisions of the Notes, other than pursuant
to Section 3.4;


 


(e)               
except to the extent the Company is in compliance with Section 10.2 below, at any time following the tenth (10th) Trading
Day that the Holder’s Authorized Share Allocation is less than the number of shares of Common Shares that the Holder would be entitled
to receive upon a conversion of the full Conversion Amount of this Note (without regard to any limitations on conversion set forth in
Section 3.4 or otherwise);


 


(f)                
the Company’s or any Subsidiary Guarantor’s failure to pay to the Holder (i) any amount of Principal when and as due
under this Note (including, without limitation, the Company’s or any Subsidiary Guarantor’s failure to pay any redemption
payments or amounts hereunder), or (ii) any amount of Interest, Late Charges or other amounts when and as due under this Note or any other
Transaction Document or any other agreement, document, certificate or other instrument delivered in connection with the transactions contemplated
hereby and thereby, and, solely in the case of this clause (ii), such failure shall continue for two (2) Business Days following such
date due;


 


(g)               
the Company fails to remove any restrictive legend on any certificate or any shares of Common Shares issued to the Holder as and
when required by the Securities Purchase Agreement or this Note, unless otherwise then prohibited by applicable federal securities laws,
and any such failure remains uncured for at least five (5) Trading Days;


 


(h)               
the occurrence of any default under, redemption of or acceleration prior to maturity of, any Indebtedness in an aggregate principal
amount of at least $500,000 of the Company or any of its Subsidiaries, including any Senior Secured Convertible Notes issued pursuant
to the Securities Purchase Agreement following the Issuance Date that are referred to in the Securities Purchase Agreement as the Second
Closing Notes (but excluding the Other Notes), Third Closing Notes or Fourth Closing Notes;


 


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


 









    	 	7	 



     


    

 


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


 


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


 


(l)                
a final judgment or judgments for the payment of money aggregating in excess of $500,000 are rendered against the Company and/or
any of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged, settled or stayed
pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, any judgment which
is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $500,000 amount set forth
above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which written statement
shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an indemnity and the Company
or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within thirty (30) days of the issuance
of such judgment;


 


(m)             
the Company and/or any Subsidiary, individually or in the aggregate, suffer to exist any other circumstance or event that would,
with or without the passage of time or the giving of notice, result in a default or event of default under any agreement binding the Company
or any Subsidiary, which default or event of default would or is likely to have a material adverse effect on the business, assets, operations
(including results thereof), liabilities, properties, condition (including financial condition) or prospects of the Company or any of
its Subsidiaries, individually or in the aggregate;


 






    	 	8	 



     


    

 


(n)               
any default by the Company in the due performance and observance of any of the covenants or agreements contained Section 13;


 


(o)               
any representation, warranty or other written statement of the Company set forth in any Transaction Document or any certification
provided by the Company pursuant to any Transaction Document is incorrect or misleading in any material respect when given;


 


(p)               
other than as specifically set forth in another clause of this Section 4.1, any default by the Company in the due performance and
observance of any of the covenants or agreements of any Transaction Document, except, in the case of a breach of a covenant that is curable,
only if such breach remains uncured for a period of five (5) consecutive Trading Days;


 


(q)               
a false or inaccurate certification (including a false or inaccurate deemed certification) by the Company that either (A) the Equity
Conditions are satisfied, (B) there has been no Equity Conditions Failure, or (C) as to whether any Event of Default has occurred;


 


(r)                
either (i) the FDA Approval shall be revoked, withdrawn or terminated for any reason or (ii) the United States Food & Drug
Administrative shall, for any reason, revoke or withdrawal its market authorization for PEDMARK;


 


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


 


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


 


(u)               
the Security Agreement or any other Security Document shall for any reason fail or cease to create a valid and perfected and, except
to the extent permitted by the terms hereof or thereof, first priority Lien on the Collateral (as defined in the Security Documents) in
favor of the Holder or any material provision of any Security Document shall at any time for any reason cease to be valid and binding
on or enforceable against the Company or the validity or enforceability thereof shall be contested by any party thereto, or a proceeding
shall be commenced by the Company or any governmental authority having jurisdiction over the Company, seeking to establish the invalidity
or unenforceability thereof; or


 






    	 	9	 



     


    

 


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


 


4.2              
Notice of an Event of Default: Event of Default Redemption Right. Upon the occurrence of an Event of Default with respect
to this Note or any Other Note, the Company shall within one (1) Business Day of becoming aware of such Event of Default deliver written
notice thereof via facsimile or electronic mail and overnight courier (with next day delivery specified) (an “Event of Default
Notice”) to the Holder. At any time after the earlier of the Holder’s receipt of an Event of Default Notice and the
Holder becoming aware of an Event of Default and ending (such ending date, the “Event of Default Right Expiration Date”)
on the twentieth (20th) Trading Day after the later of (x) the date such Event of Default is cured and (y) the Holder’s
receipt of an Event of Default Notice that includes (I) a reasonable description of the applicable Event of Default, (II) a certification
as to whether, in the opinion of the Company, such Event of Default is capable of being cured and, if applicable, a reasonable description
of any existing plans of the Company to cure such Event of Default and (III) a certification as to the date the Event of Default occurred
and, if cured on or prior to the date of such Event of Default Notice, the applicable Event of Default Right Expiration Date, the Holder
may require the Company to redeem (regardless of whether such Event of Default has been cured on or prior to the Event of Default Right
Expiration Date) all or any portion of this Note by delivering written notice thereof (the “Event of Default Redemption Notice”)
to the Company, which Event of Default Redemption Notice shall indicate the portion of this Note the Holder is electing to redeem. Each
portion of this Note subject to redemption by the Company pursuant to this Section 4.2 shall be redeemed by the Company at a price equal
to the greater of (i) the product of (A) the Conversion Amount to be redeemed multiplied by (B) the Redemption Premium as of the date
of the Event of Default and (ii) the product of (x) the Redemption Premium as of the date of the Event of Default multiplied by (y) the
product of (A) the Conversion Amount being redeemed multiplied by (B) the quotient determined by dividing (I) the greatest Closing Sale
Price of the shares of Common Shares during the period beginning on the date immediately preceding such Event of Default and ending on
the date the Company makes the entire payment required to be made under this Section 4.2 by (II) the Conversion Price then in effect (the
 “Event of Default Redemption Price”). Redemptions required by this Section 4.2 shall be made in accordance with
the provisions of Section 11. To the extent redemptions required by this Section 4.2 are deemed or determined by a court of competent
jurisdiction to be prepayments of this Note by the Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding
anything to the contrary in this Section 4.2, but subject to Section 3.4, until the Event of Default Redemption Price (together with any
Late Charges thereon) is satisfied in full, the Conversion Amount submitted for redemption under this Section 4.2 (together with any Late
Charges thereon) may be converted, in whole or in part, by the Holder into Common Shares pursuant to the terms of Section 3. In the event
of the Company’s redemption of any portion of this Note under this Section 4.2, the Holder’s damages would be uncertain and
difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of the availability
of a suitable substitute investment opportunity for the Holder. Accordingly, any redemption premium due under this Section 4.2 is intended
by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its investment opportunity and not
as a penalty. Any redemption upon an Event of Default shall not constitute an election of remedies by the Holder, and all other rights
and remedies of the Holder shall be preserved.


 






    	 	10	 



     


    

 


4.3              
Mandatory Redemption upon Bankruptcy Event of Default. Notwithstanding anything to the contrary herein, and notwithstanding
any conversion that is then required or in process, upon any Bankruptcy Event of Default, whether occurring prior to or following the
Maturity Date, the Company shall immediately pay to the Holder an amount in cash representing (i) all outstanding Principal, accrued and
unpaid Interest, and accrued and unpaid Late Charges on such Principal and Interest, multiplied by (ii) the Redemption Premium as of the
date of the Bankruptcy Event of Default, in addition to any and all other amounts due hereunder, without the requirement for any notice
or demand or other action by the Holder or any other person or entity; provided that the Holder may, in its sole discretion, waive such
right to receive payment upon a Bankruptcy Event of Default, in whole or in part, and any such waiver shall not affect any other rights
of the Holder hereunder, including any other rights in respect of such Bankruptcy Event of Default, any right to conversion, and any right
to payment of the Event of Default Redemption Price or any other Redemption Price, as applicable.


 


5.                  
Fundamental Transactions; Change of Control.


 


5.1              
Fundamental Transactions.


 


(a)               
Restrictions. The Company shall not enter into or be party to a Fundamental Transaction unless: either (i) the Company
is the surviving Person; or (ii) the Successor Entity (if other than the Company) assumes in writing all of the obligations of the Company
under this Note and the other Transaction Documents as provided in Section 5.1(b).


 


(b)               
Assumption. To satisfy clause (ii) of Section 5.1(a), (i) the Successor Entity shall assume in writing all of the obligations
of the Company under this Note and the other Transaction Documents pursuant to written agreements in form and substance reasonably satisfactory
to the Holder and approved by the Holder prior to such Fundamental Transaction, including agreements to deliver to each holder of Notes
in exchange for such Notes a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance
to the Notes, including, without limitation, having a principal amount and interest rate equal to the principal amounts then outstanding
and the interest rates of the Notes, respectively, held by such holder, having similar conversion rights as the Notes and having similar
ranking and security to the Notes, and reasonably satisfactory to the Holder and the Company (or the Successor Entity, as applicable)
and (ii) the Successor Entity (including its Parent Entity) is a publicly traded corporation whose Common Shares is quoted on or
listed for trading on an Eligible Market. Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and the other Transaction
Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under this Note and the other Transaction Documents with the same
effect as if such Successor Entity had been named as the Company herein.


 


(c)               
Confirmation. Upon consummation of a Fundamental Transaction, the Successor Entity shall deliver to the Holder confirmation
that there shall be issued upon conversion or redemption of this Note at any time after the consummation of such Fundamental Transaction,
in lieu of the shares of Common Shares (or other securities, cash, assets or other property) issuable upon the conversion or redemption
of the Notes prior to such Fundamental Transaction, such shares of the publicly traded Common Shares (or their equivalent) of the Successor
Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening of such Fundamental Transaction
had this Note been converted immediately prior to such Fundamental Transaction (without regard to any limitations on the conversion of
this Note), as adjusted in accordance with the provisions of this Note.


 






    	 	11	 



     


    

 


(d)               
Waiver. Notwithstanding the foregoing, the Holder may elect, at its sole option, by delivery of written notice to the Company
to waive this Section 5.1 to permit the Fundamental Transaction without the assumption of this Note.


 


(e)               
Applicability. The provisions of this Section 5 shall apply similarly and equally to successive Fundamental Transactions
and shall be applied without regard to any limitations on the conversion of this Note.


 


5.2              
Notice of a Change of Control; Redemption Right. No sooner than twenty (20) Trading Days nor later than ten (10) Trading
Days prior to the consummation of a Change of Control (the “Change of Control Date”), but not prior to the public
announcement of such Change of Control, the Company shall deliver written notice thereof via facsimile or electronic mail and overnight
courier to the Holder (a “Change of Control Notice”). At any time during the period beginning after the Holder’s
receipt of a Change of Control Notice or the Holder becoming aware of a Change of Control if a Change of Control Notice is not delivered
to the Holder in accordance with the immediately preceding sentence (as applicable) and ending on the later of ten (10) Trading Days after
(A) consummation of such Change of Control or (B) the date of receipt of such Change of Control Notice, the Holder may require the Company
to, or the Company may on its own volition, redeem all or any portion of this Note by delivering written notice thereof (“Change
of Control Redemption Notice”) to the Company or Holder, as applicable which Change of Control Redemption Notice shall indicate
the Conversion Amount the Holder or Company, as applicable, is electing to redeem. The portion of this Note subject to redemption pursuant
to this Section 5.2 shall be redeemed by the Company in cash at a price (the “Change of Control Redemption Price”)
equal to the greatest of (i) the product of (w) the Redemption Premium as of the date of the date of the Change of Control multiplied
by (y) the Conversion Amount being redeemed, (ii) the product of (x) the Redemption Premium as of the date of the Change of Control multiplied
by (y) the product of (A) the Conversion Amount being redeemed multiplied by (B) the quotient determined by dividing (I) the greatest
Closing Sale Price of the shares of Common Shares during the period beginning on the date immediately preceding the earlier to occur of
(1) the consummation of the applicable Change of Control and (2) the public announcement of such Change of Control and ending on the date
the Holder delivers the Change of Control Redemption Notice by (II) the Conversion Price then in effect and (iii) the product of (y) the
Redemption Premium as of the date of the Change of Control multiplied by (z) the product of (A) the Conversion Amount being redeemed multiplied
by (B) the quotient of (I) the aggregate cash consideration plus the aggregate cash value of any non-cash consideration per share of Common
Shares to be paid to the holders of the shares of Common Shares upon consummation of such Change of Control (any such non-cash consideration
constituting publicly-traded securities shall be valued at the highest of the Closing Sale Price of such securities as of the Trading
Day immediately prior to the consummation of such Change of Control, the Closing Sale Price of such securities on the Trading Day immediately
following the public announcement of such proposed Change of Control and the Closing Sale Price of such securities on the Trading Day
immediately prior to the public announcement of such proposed Change of Control) divided by (II) the Conversion Price then in effect (the
 “Change of Control Redemption Price”). Redemptions required by this Section 5.2 shall be made in accordance
with the provisions of Section 11 and shall have priority to payments to shareholders in connection with such Change of Control. To the
extent redemptions required by this Section 5.2 are deemed or determined by a court of competent jurisdiction to be prepayments of this
Note by the Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section
5.2, but subject to Section 3.4, until the Change of Control Redemption Price (together with any Late Charges thereon) is paid in full,
the Conversion Amount submitted for redemption under this Section 5.2 (together with any Late Charges thereon) may be converted, in whole
or in part, by the Holder into Common Shares pursuant to Section 3. In the event of the Company’s redemption of any portion of this
Note under this Section 5.2, the Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability
to predict future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for the Holder.
Accordingly, any redemption premium due under this Section 5.2 is intended by the parties to be, and shall be deemed, a reasonable estimate
of the Holder’s actual loss of its investment opportunity and not as a penalty.


 


 






    	 	12	 



     


    

 


6.                  
Issuances of Purchase Rights and Other Corporate Events.


 


6.1              
Purchase Rights. In addition to any adjustments pursuant to Section 7 below, if at any time the Company grants, issues or
sells any Options, Convertible Securities or rights to purchase shares, stock, warrants, securities or other property pro rata to all
or substantially all of the record holders of any class of Common Shares (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 Shares acquirable upon complete conversion of this Note (without taking
into account any limitations or restrictions on the convertibility of this Note) immediately prior to the date on which a record is taken
for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares
of Common Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that to the extent that
the Holder’s right to participate in any such Purchase Right would result in the Holder and the other Attribution Parties exceeding
the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase Right to the extent of the Maximum Percentage
(and shall not be entitled to beneficial ownership of such shares of Common Shares as a result of such Purchase Right (and beneficial
ownership) to the extent of any such excess) and such Purchase Right to such extent shall be held in abeyance (and, if such Purchase Right
has an expiration date, maturity date or other similar provision, such term shall be extended by such number of days held in abeyance,
if applicable) for the benefit of the Holder until such time or times, if ever, as its right thereto would not result in the Holder and
the other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such right (and any
Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent Purchase Right held similarly in abeyance (and,
if such Purchase Right has an expiration date, maturity date or other similar provision, such term shall be extended by such number of
days held in abeyance, if applicable)) to the same extent as if there had been no such limitation).


 


6.2              
Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation
of any Fundamental Transaction pursuant to which holders of shares of Common Shares are entitled to receive securities or other assets
with respect to or in exchange for shares of Common Shares (a “Corporate Event”), the Company shall make appropriate
provision to ensure that the Holder will thereafter have the right to receive upon a conversion of this Note, at the Holder’s option
(i) in addition to the shares of Common Shares receivable upon such conversion, such securities or other assets to which the Holder would
have been entitled with respect to such shares of Common Shares had such shares of Common Shares been held by the Holder upon the consummation
of such Corporate Event (without taking into account any limitations or restrictions on the convertibility of this Note) or (ii) in lieu
of the shares of Common Shares otherwise receivable upon such conversion, such securities or other assets received by the holders of shares
of Common Shares in connection with the consummation of such Corporate Event in such amounts as the Holder would have been entitled to
receive had this Note initially been issued with conversion rights for the form of such consideration (as opposed to shares of Common
Shares) at a conversion rate for such consideration commensurate with the Conversion Rate. Provision made pursuant to the preceding sentence
shall be in a form and substance satisfactory to the Holder. The provisions of this Section 6.2 shall apply similarly and equally to successive
Corporate Events and shall be applied without regard to any limitations on the conversion or redemption of this Note.


 






    	 	13	 



     


    

 


7.                  
Adjustments to the Conversion Price.


 


7.1              
Adjustment of Conversion Price upon Subdivision or Combination of Common Shares or Share Dividend. If the Company issues
solely shares of Common Shares as a dividend or distribution on all or substantially all shares of the Common Shares, or if the Company
effects a share split or a share combination of the Common Shares (in each case excluding an issuance solely pursuant to a Fundamental
Transaction or other Corporate Event, as to which the provisions set forth in Sections 5 and 6 will apply), then the Conversion Price
will be adjusted based on the following formula:


 





 


Where: 


CP0=


	CP0	=	the Conversion Price in effect immediately before the open of business on the ex-dividend date for such dividend or distribution, or immediately before the open of business on the effective date of such share split or share combination, as applicable
	 	 	 
	CP1	=	the Conversion Price in effect immediately after the open of business on such ex-dividend date or the open of business on such effective date, as applicable
	 	 	 
	OS0	=	the number of shares of Common Shares outstanding immediately before the open of business on such ex-dividend date or effective date, as applicable
	 	 	 
	OS1	=	the number of shares of Common Shares outstanding immediately after giving effect to such dividend, distribution, share split or share combination


  


For the avoidance of doubt, pursuant
to the definition of CP1 above, any adjustment to the Conversion Price made pursuant to this Section 7.1 will become effective
immediately after the open of business on such ex-dividend date or the open of business on such effective date, as applicable. If any
dividend, distribution, share split or share combination of the type described in this Section 7.1 is declared or announced, but
not so paid or made, then the Conversion Price, if previously adjusted, will be readjusted, effective as of the date the Board of Directors
of the Company determines not to pay such dividend or distribution or to effect such share split or share combination, to the Conversion
Price that would then be in effect had such dividend, distribution, share split or share combination not been declared or announced.


 






    	 	14	 



     


    

 


7.2              
Rights, Options and Warrants. If the Company distributes, to all or substantially all holders of Common Shares, rights,
options or warrants entitling such holders, for a period of not more than sixty (60) calendar days after the record date of such
distribution, to subscribe for or purchase shares of Common Shares at a price per share that is less than the average of the Closing Sale
Prices per share of Common Shares for the ten (10) consecutive Trading Days ending on, and including, the Trading Day immediately
before the date such distribution is publicly announced, then the Conversion Price will be decreased based on the following formula:


 





 


Where:


 


	CP0	=	the Conversion Price in effect immediately before the open of business on the ex-dividend date for such distribution
	 	 	 
	CP1	=	the Conversion Price in effect immediately after the open of business on such ex-dividend date 
	 	 	 
	OS	=	the number of shares of Common Shares outstanding immediately before the open of business on such ex-dividend date
	 	 	 
	X	=	the total number of shares of Common Shares issuable pursuant to such rights, options or warrants
	 	 	 
	Y	=	a number of shares of Common Shares obtained by dividing (x) the aggregate amount payable to exercise all such rights, options or warrants distributed by the Company by (y) the average of the Closing Sale Prices per share of Common Shares for the ten (10) consecutive Trading Days ending on, and including, the Trading Day immediately before the date such distribution is announced








 


For the avoidance of doubt, any adjustment
to the Conversion Price made pursuant to this Section 7.2 will be made successively whenever any such rights, options or warrants
are issued and, pursuant to the definition of CP1 above, will become effective immediately after the open of business on the
ex-dividend date for the applicable distribution. To the extent that shares of Common Shares are not delivered after the expiration of
such rights, options or warrants (including as a result of such rights, options or warrants not being exercised), the Conversion Price,
if previously adjusted, will be readjusted effective as of such expiration date to the Conversion Price that would then be in effect had
the decrease to the Conversion Price for such distribution been made on the basis of delivery of only the number of shares of Common Shares
actually delivered upon exercise of such rights, option or warrants. To the extent such rights, options or warrants are not so distributed,
the Conversion Price will be readjusted effective as of the date the Board of Directors of the Company determines not to distribute such
rights, options or warrants, to the Conversion Price that would then be in effect had the ex-dividend date for the distribution of such
rights, options or warrants not occurred. For purposes of this Section 7.2, in determining whether any rights, options or warrants
entitle holders of Common Shares to subscribe for or purchase shares of Common Shares at a price per share that is less than the average
of the Closing Sale Prices per share of Common Shares for the ten (10) consecutive Trading Days ending on, and including, the Trading
Day immediately before the date of the distribution of such rights, options or warrants is announced, and in determining the aggregate
price payable to exercise such rights, options or warrants, there will be taken into account any consideration the Company receives for
such rights, options or warrants and any amount payable on exercise thereof, with the value of such consideration, if not cash, to be
determined by the Board of Directors of the Company.


 






    	 	15	 



     


    

 


7.3              
Voluntary Adjustment by Company. The Company may at any time during the term of this Note, with the prior written consent
of the Required Holders, reduce the then current Conversion Price to any amount and for any period of time deemed appropriate by the Board
of Directors of the Company.


 


8.                  
Redemptions at the Company’s Election.


 


8.1              
Company Optional Redemption.


 


(a)               
At any time after August 19, 2025, so long as no Equity Conditions Failure exists, the Company shall have the right to redeem all,
but not less than all, of the Conversion Amount then remaining under this Note (the “Company Optional Redemption Amount”)
on the Company Optional Redemption Date (a “Company Optional Redemption”). The portion of this Note subject
to redemption pursuant to this Section 8.1 shall be redeemed by the Company in cash at a price (the “Company Optional Redemption
Price”) equal to the product of (A) the Redemption Premium as of the Company Optional Redemption Date multiplied by (B)
the Conversion Amount being redeemed as of the Company Optional Redemption Date.


 


(b)               
The Company may exercise its right to require redemption under this Section 8.1 by delivering a written notice thereof by facsimile
or electronic mail and overnight courier to all, but not less than all, of the holders of Notes (the “Company Optional Redemption
Notice” and the date all of the holders of Notes received such notice is referred to as the “Company Optional
Redemption Notice Date”). The Company may deliver only one Company Optional Redemption Notice hereunder and such Company
Optional Redemption Notice shall be irrevocable. The Company Optional Redemption Notice shall (x) state the date on which the Company
Optional Redemption shall occur (the “Company Optional Redemption Date”) which date shall not be less than ten
(10) Trading Days nor more than twenty (20) Trading Days following the Company Optional Redemption Notice Date, (y) certify that there
has been no Equity Conditions Failure and (z) state the aggregate Conversion Amount of the Notes which is being redeemed in such Company
Optional Redemption from the Holder and all of the other holders of the Notes pursuant to this Section 8.1 (and analogous provisions under
the Other Notes) on the Company Optional Redemption Date.


 


(c)               
Notwithstanding anything herein to the contrary, (i) if no Equity Conditions Failure has occurred as of the Company Optional Redemption
Notice Date but an Equity Conditions Failure occurs at any time prior to the Company Optional Redemption Date, (A) the Company shall provide
the Holder a subsequent notice to that effect, and (B) unless the Holder waives the Equity Conditions Failure, the Company Optional Redemption
shall be cancelled and the applicable Company Optional Redemption Notice shall be null and void, (ii) at any time prior to the date the
Company Optional Redemption Price is paid, in full, the Company Optional Redemption Amount may be converted, in whole or in part, by the
Holder into shares of Common Shares pursuant to Section 3, and (iii) solely in the event that an Automatic Conversion Event has occurred
as of the Company Optional Redemption Date, then, effective on the Company Optional Redemption Date prior to redemption of this Note,
the Company Optional Redemption Amount shall automatically, without any further required act of the Holder, be converted into shares of
Common Shares in accordance with Section 3.5 (any such conversion of the Company Optional Redemption Amount in shares of Common Shares
pursuant to this clause (iii) is herein referred to as a “Redemption Automatic Conversion”).


 






    	 	16	 



     


    

 


(d)               
All Conversion Amounts converted by the Holder after the Company Optional Redemption Notice Date shall reduce the Company Optional
Redemption Amount of this Note required to be redeemed on the Company Optional Redemption Date. Redemptions made pursuant to this Section
8.1 shall be made in accordance with Section 11.


 


(e)               
In the event of the Company’s redemption of any portion of this Note under this Section 8.1, the Holder’s damages would
be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty of
the availability of a suitable substitute investment opportunity for the Holder. Accordingly, any redemption premium due under this Section
8.1 is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss of its investment opportunity
and not as a penalty. For the avoidance of doubt, the Company shall have no right to effect a Company Optional Redemption if any Event
of Default has occurred and continuing, but any Event of Default shall have no effect upon the Holder’s right to convert this Note
in its discretion.


 


8.2              
Pro Rata Redemption Requirement. If the Company elects to cause a Company Optional Redemption of this Note pursuant to Section
8.1, then it must simultaneously take the same action with respect to all of the Other Notes.


 


9.                  
Noncircumvention. The Company hereby covenants and agrees that the Company will not, by amendment of its certificate
or articles of incorporation, bylaws or other governing document or through any reorganization, transfer of assets, consolidation, merger,
scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Note, and will at all times in good faith carry out all of the provisions of this Note and
take all action as may be required to protect the rights of the Holder of this Note. Without limiting the generality of the foregoing
or any other provision of this Note or the other Transaction Documents, the Company (a) shall not increase the par value of any shares
of Common Shares receivable upon conversion of this Note above the Conversion Price then in effect, and (b) shall take all such actions
as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common
Shares upon the conversion of this Note.





 


10.              
Reservation of Authorized Shares.


 


10.1          
Reservation. The Company shall initially reserve out of its authorized and unissued shares of Common Shares a number of
shares of Common Shares for each of this Note and the Other Notes equal to 120% of the Conversion Rate with respect to the Conversion
Amount of each such Note as of the Issuance Date. So long as any of this Note and the Other Notes are outstanding, the Company shall take
all action necessary to reserve and keep available out of its authorized and unissued Common Shares, solely for the purpose of effecting
the conversion of this Note and the Other Notes, the number of shares of Common Shares as shall from time to time be necessary to effect
the conversion of all of the Notes then outstanding; provided, that at no time shall the number of shares of Common Shares so reserved
be less than the number of shares required to be reserved pursuant hereto (in each case, without regard to any limitations on conversions)
(the “Required Reserve Amount”). The initial number of shares of Common Shares reserved for conversions of this
Note and the Other Notes and each increase in the number of shares so reserved shall be allocated pro rata among the Holder and the holders
of the Other Notes based on the Principal amount of this Note and the Other Notes held by each holder at the Closing (as defined in the
Securities Purchase Agreement) or at the time of the increase in the number of reserved shares, as the case may be (the “Authorized
Share Allocation”). In the event that a holder shall sell or otherwise transfer this Note, or a portion thereof, or any
of such holder’s Other Notes, each transferee shall be allocated a pro rata portion of such holder’s Authorized Share Allocation.


 






    	 	17	 



     


    

 


10.2          
Insufficient Authorized Shares.


 


(a)               
If at any time while any of the Notes remain outstanding the Company does not have a sufficient number of authorized and unreserved
shares of Common Shares to satisfy its obligation to have reserved for issuance upon conversion of the outstanding Notes at least a number
of shares of Common Shares equal to the Required Reserve Amount (an “Authorized Share Failure”), then the Company
shall promptly take all action necessary to increase the Company’s authorized shares of Common Shares to an amount sufficient to
allow the Company to reserve the Required Reserve Amount for the Notes then outstanding. Without limiting the generality of the foregoing
sentence, as soon as practicable after the date of the occurrence of an Authorized Share Failure, but in no event later than sixty (60) days
after the occurrence of such Authorized Share Failure, the Company shall either (x) obtain the written consent of its shareholders
for the approval of an increase in the number of authorized shares of Common Shares and provide each shareholder with an information statement
with respect thereto or (y) file with the SEC a proxy statement for a meeting of its shareholders at which meeting the Company will
seek the approval of its shareholders for an increase in the number of authorized shares of Common Shares. In connection with such meeting,
the Company shall provide each shareholder with a proxy statement and shall use commercially reasonable efforts to solicit its shareholders’
approval of such increase in authorized shares of Common Shares and to cause its Board of Directors to recommend to the shareholders that
they approve such proposal. Notwithstanding the foregoing, if during any such time of an Authorized Share Failure, the Company is able
to obtain the written consent of a majority of the shares of its issued and outstanding Common Shares to approve the increase in the number
of authorized shares of Common Shares, the Company may satisfy this obligation by obtaining such consent and submitting for filing with
the SEC an Information Statement on Schedule 14C.


 


(b)               
If, upon any conversion of this Note, the Company does not have sufficient authorized shares to deliver in satisfaction of such
conversion, then unless the Holder elects to rescind such attempted conversion, the Holder may require the Company, in lieu of issuing
Common Shares in connection with such conversion and in full satisfaction of the Company’s obligations with respect to such conversion,
to pay to the Holder within three (3) Trading Days of the applicable attempted conversion, cash in an amount equal to the product
of (i) the number of shares of Common Shares that the Company is unable to deliver pursuant to this Section 10, and (ii) the
highest Closing Sale Price of the Common Shares during the period beginning on the applicable Conversion Date and ending on the date the
Company makes the applicable cash payment.


 






    	 	18	 



     


    

 


11.              
Redemptions.


 


11.1          
Mechanics.


 


(a)               
If the Holder has submitted an Event of Default Redemption Notice in accordance with Section 4.2, the Company shall deliver the
applicable Event of Default Redemption Price to the Holder in cash within five (5) Business Days after the Company’s receipt of
the Holder’s Event of Default Redemption Notice (each, an “Event of Default Redemption Date”).


 


(b)               
If the Company or Holder has submitted a Change of Control Redemption Notice in accordance with Section 5.2, the Company shall
deliver the applicable Change of Control Redemption Price to the Holder in cash concurrently with the consummation of such Change of Control
if such notice is received prior to the consummation of such Change of Control and within two (2) Business Days after the Company’s
or Holders’ receipt (as applicable) of such notice otherwise (each, a “Change of Control Redemption Date”).


 


(c)               
In the event of a Company Optional Redemption, the Company shall deliver the applicable Company Optional Redemption Price to the
Holder in cash on the applicable Company Optional Redemption Date.


 


(d)               
Notwithstanding anything herein to the contrary, in connection with any redemption hereunder at a time the Holder is entitled to
receive a cash payment under any of the other Transaction Documents, at the option of the Holder delivered in writing to the Company,
the applicable Redemption Price hereunder shall be increased by the amount of such cash payment owed to the Holder under such other Transaction
Document and, upon payment in full or conversion in accordance herewith, shall satisfy the Company’s payment obligation under such
other Transaction Document.


 


(e)               
In the event of a redemption of less than all of the Conversion Amount of this Note, the Company shall promptly cause to be issued
and delivered to the Holder a new Note (in accordance with Section 18.4) representing the outstanding Principal which has not been redeemed.


 


(f)                
In the event that the Company does not pay the applicable Redemption Price to the Holder within the time period required, at any
time thereafter and until the Company pays such unpaid Redemption Price in full, the Holder shall have the option, in lieu of redemption,
to require the Company to promptly return to the Holder all or any portion of this Note representing the Conversion Amount that was submitted
for redemption and for which the applicable Redemption Price (together with any Late Charges thereon) has not been paid. Upon the Company’s
receipt of such notice, (x) the applicable Redemption Notice shall be null and void with respect to such Conversion Amount, and (y) the
Company shall immediately return this Note, or issue a new Note (in accordance with Section 18.4), to the Holder; provided, that, notwithstanding
the applicable Redemption Notice being deemed null and void and such return or issuance of this Note or a new Note in accordance with
the foregoing, a continual Event of Default shall thereafter be deemed to have occurred and be continuing until the subsequent repayment
or conversion of this Note in full. Furthermore, the Holder’s delivery of a notice voiding a Redemption Notice and exercise of its
rights following such notice shall not affect the Company’s obligations to make any payments of Late Charges which have accrued
prior to the date of such notice with respect to the Conversion Amount subject to such notice.


 






    	 	19	 



     


    

 


11.2          
Redemption by Other Holders. Upon the Company’s receipt of notice from any of the holders of the Other Notes for redemption
or repayment as a result of an event or occurrence substantially similar to the events or occurrences described in Section 4 or Section
5.2 (each, an “Other Redemption Notice”), the Company shall immediately, but no later than two (2) Business
Days after its receipt thereof, forward to the Holder by facsimile or electronic mail a copy of such notice. If the Company receives a
Redemption Notice and one or more Other Redemption Notices, during the seven (7) Business Day period beginning on and including the date
which is two (2) Business Days prior to the Company’s receipt of the Holder’s applicable Redemption Notice and ending on and
including the date which is five (5) Business Days after the Company’s receipt of the Holder’s applicable Redemption Notice
and the Company is unable to redeem all principal, interest and other amounts designated in such Redemption Notice and such Other Redemption
Notices received during such seven (7) Business Day period, then the Company shall redeem a pro rata amount from each holder of the Notes
(including the Holder) based on the principal amount of the Notes submitted for redemption pursuant to such Redemption Notice and such
Other Redemption Notices received by the Company during such seven (7) Business Day period.


 


12.              
Voting Rights. The Holder shall have no voting rights as the holder of this Note, except as required by law and as
expressly provided in this Note.


 


13.              
Covenants. Until all of the Notes have been converted, redeemed or otherwise satisfied, in full, in accordance with
their terms:


 


13.1          
Rank. All payments due under this Note (a) shall rank pari passu with all Other Notes, any Senior Secured Convertible
Notes issued pursuant to the Securities Purchase Agreement prior to the Issuance Date that are referred to in the Securities Purchase
Agreement as the First Closing Notes, and any Senior Secured Convertible Notes issued pursuant to the Securities Purchase Agreement following
the Issuance Date that are referred to in the Securities Purchase Agreement as the Third Closing Notes or Fourth Closing Notes and (b)
shall be senior to all other Indebtedness of the Company and its Subsidiaries.


 


13.2          
Incurrence of Indebtedness. The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly
or indirectly, incur or guarantee, assume or suffer to exist any Indebtedness (other than (i) the Indebtedness evidenced by this Note,
the Other Notes, any Senior Secured Convertible Notes issued pursuant to the Securities Purchase Agreement prior to the Issuance Date
that are referred to in the Securities Purchase Agreement as the First Closing Notes, and any Senior Secured Convertible Notes issued
pursuant to the Securities Purchase Agreement following the Issuance Date that are referred to in the Securities Purchase Agreement as
the Third Closing Notes or Fourth Closing Notes and (ii) other Permitted Indebtedness).


 


13.3          
Existence of Liens. The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly or indirectly,
allow or suffer to exist any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by the Company or any of its Subsidiaries (collectively, “Liens”)
other than Permitted Liens.


 






    	 	20	 



     


    

 


13.4          
Redemption and Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or
indirectly, redeem, repurchase or declare or pay any dividend or distribution on any of its shares of capital stock (any of the foregoing,
a “Restricted Payment”), other than (i) Restricted Payments made by any Subsidiary to the Company or any other
Subsidiary of the Company, (ii) any dividend payments or other distributions by the Company or any Subsidiary payable solely in shares
of capital stock of such Person and (iii) purchases, repurchases, redemptions, defeasances or other acquisitions or retirements of shares
of capital stock deemed to occur upon the exercise of share options, warrants or other rights in respect thereof if such share of capital
stock represents a portion of the exercise price thereof.


 


13.5          
Transfer of Assets. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
sell, lease, license, assign, transfer, spin-off, split-off, close, convey or otherwise dispose of any material assets or rights of the
Company or any Subsidiary owned or hereafter acquired whether in a single transaction or a series of related transactions, other than
(i) sales, leases, licenses, assignments, transfers, conveyances and other dispositions of such assets or rights by the Company and its
Subsidiaries in the ordinary course of business consistent with its past practice, (ii) sales of inventory and product in the ordinary
course of business, or (iii) sales or other transfers of assets from the Company or any Subsidiary Guarantor to the Company or any Subsidiary
Guarantor.


 


13.6          
Acquisitions. Without the prior written consent of the Required Holders, the Company shall not, and the Company shall cause
each of its Subsidiaries to not, directly or indirectly, acquire all or substantially all of the assets or capital stock of any Person
or acquire all or substantially all of the assets of any operating division of any Person (each, an “Acquisition”)
if the aggregate consideration payable by the Company and its Subsidiaries in connection with such Acquisition or a series of related
Acquisitions (including, without limitation, all cash or equity consideration, all Indebtedness or other liabilities incurred or assumed
and the maximum amount of any earn-out or comparable payment obligation in connection therewith) exceeds $500,000.


 


13.7          
Change in Nature of Business. The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly
or indirectly, engage in any material line of business substantially different from those lines of business conducted by or publicly contemplated
to be conducted by the Company and each of its Subsidiaries on the First Closing Date or any business substantially related or incidental
thereto. The Company shall not, and the Company shall not permit any of its Subsidiaries to, directly or indirectly, modify its or their
corporate structure or purpose in any material respect.


 


13.8          
Transactions with Affiliates. The Company shall not, nor shall it permit any of its Subsidiaries to, enter into, renew,
extend or be a party to, any transaction or series of related transactions (including, without limitation, the purchase, sale, lease,
transfer or exchange of property or assets of any kind or the rendering of services of any kind) with any affiliate, except (i) transactions
entered into in the ordinary course of business in a manner and to an extent consistent with past practice and necessary or desirable
for the prudent operation of its business, and (ii) transactions entered into for fair consideration and on terms no less favorable to
it or its Subsidiaries than would be obtainable in a comparable arm’s length transaction with a Person that is not an affiliate
thereof.


 






    	 	21	 



     


    

 


13.9          
Maintenance of Existence; Compliance with Contracts, Laws, Etc. The Company shall, and the Company shall cause its Subsidiaries
to, preserve and maintain its legal existence, perform in all material respects its obligations under all material agreements, contracts
and instruments to which the Company or such Subsidiary is a party, take all actions to ensure that all such material agreements remain
in full force and effect, and comply in all material respects with all applicable laws, rules, regulations and orders, including the payment
(before the same become delinquent), of all taxes, imposed upon it or upon its property except to the extent being diligently contested
in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP have been set aside on the books of the
Company or its Subsidiary, as applicable.


 


13.10       
Insurance. The Company shall, and the Company shall cause its Subsidiaries to, maintain:


 


(a)               
insurance on its property with financially sound and reputable insurance companies against business interruption, loss and damage
in at least the amounts (and with only those deductibles) customarily maintained, and against such risks as are typically insured against
in the same general area, by Persons of comparable size engaged in the same or similar business as the Company its Subsidiaries; and


 


(b)               
all worker’s compensation, employer’s liability insurance or similar insurance as may be required under the laws of
any state or jurisdiction in which it may be engaged in business.


 


13.11       
Subsidiary Matters.


 


(a)               
Neither the Company nor any Subsidiary Guarantor shall establish, form, create or acquire any new direct or indirect Subsidiary
unless such Subsidiary shall, on the date of the establishment, formation, creation or acquisition thereof, (x) become a Subsidiary Guarantor
by executing and delivering to the Holder a joinder to the Guaranty Agreement or such other document as the Holder shall reasonably deem
appropriate for such purpose, (y) take all such action and execute such agreements, documents and instruments requested by the Holder,
including execution and delivery of a joinder to the Security Agreement and execution and delivery of such other Security Documents, that
may be necessary to grant to the Holder a perfected first priority security interest and Lien in any Collateral (as defined in the Securities
Purchase Agreement) owned by such new Subsidiary and (z) deliver to the Holder documents of the types referred to in clauses (xi) and
(xii) of Section 5.1(a) of the Securities Purchase Agreement and, if reasonably requested by the Holder, favorable opinions of counsel
to such new Subsidiary (which shall cover, among other things, the legality, validity, binding effect and enforceability of the documentation
referred to in clauses (x) and (y) of this subsection), all in form, content and scope reasonably satisfactory to the Holder.


 


(b)               
Neither the Company nor any Subsidiary Guarantor will make any Investment in any Person other than a Subsidiary Guarantor.


 


13.12       
Maintenance of Authorizations, Contract Rights, Intellectual Property, Etc. The Company shall, and the Company shall cause
its Subsidiaries to, (i) maintain in full force and effect all Regulatory Authorizations, contract rights, authorizations or other
rights necessary and material for the operations of its business, and comply with the terms and conditions applicable to the foregoing,
excluding the maintenance of any Regulatory Authorizations that are not commercially reasonably necessary or material for the conduct
of the business of the Company and its Subsidiaries; (ii) operate their business and facilities in material compliance with all applicable
laws, rules and regulations, including any newly introduced or revised applicable laws, rules and regulations as they may become introduced,
altered or otherwise evolve over time; (iii) diligently pursue any application for registration of any existing or future Intellectual
Property owned, developed or controlled (or jointly owned, developed or controlled) by the Company and its Subsidiaries; (iv) maintain
in full force and effect or pursue the prosecution of, as the case may be, and pay all costs and expenses relating to, all Intellectual
Property owned, developed or controlled (or jointly owned, developed or controlled) by the Company and its Subsidiaries, excluding the
maintenance of any Intellectual Property that is not commercially reasonably necessary or material for the conduct of the business of
the Company or any of its Subsidiaries; (v) use commercially reasonable efforts to pursue and maintain in full force and effect legal
protection for all Intellectual Property developed, used or controlled (or jointly owned, developed or controlled) by the Company or any
of its Subsidiaries; and (vi) not permit the activities and business of the Company or any of its Subsidiaries to violate, infringe,
misappropriate or misuse any Intellectual Property of any other Person.


 






    	 	22	 



     


    

 


13.13       
Liquidity. The Company shall at all times maintain Liquidity of at least $5,000,000.


 


13.14       
Books and Records. The Company shall, and the Company shall cause its Subsidiaries to, keep books and records in accordance
with GAAP which accurately reflect all of its business affairs and transactions.


 


14.              
Distribution of Assets. In addition to any adjustments pursuant to Section 7, if the Company shall declare or make
any dividend or other distributions of its assets (or rights to acquire its assets) to any or all holders of shares of Common Shares,
by way of return of capital or otherwise (including without limitation, any distribution of cash, stock or other securities, property
or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction)
(the “Distributions”), then the Holder will be entitled to such Distributions as if the Holder had held the
number of shares of Common Shares acquirable upon complete conversion of this Note (without taking into account any limitations or restrictions
on the convertibility of this Note and assuming for such purpose that the Note was converted at the Conversion Price as of the applicable
record date) immediately prior to the date on which a record is taken for such Distribution or, if no such record is taken, the date as
of which the record holders of Common Shares are to be determined for such Distributions (provided, however, that to the extent that the
Holder’s right to participate in any such Distribution would result in the Holder and the other Attribution Parties exceeding the
Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution to the extent of the Maximum Percentage
(and shall not be entitled to beneficial ownership of such shares of Common Shares as a result of such Distribution (and beneficial ownership)
to the extent of any such excess) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such
time or times, if ever, as its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage,
at which time or times the Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution
or on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).


 


15.              
Amendments and Waivers. The affirmative vote at a meeting duly called for such purpose or the written consent without
a meeting of the Required Holders shall be required for any change or amendment or waiver of any provision to this Note or any of the
Other Notes; provided that any such amendment or waiver that complies with the foregoing but that disproportionately, materially and adversely
affects the rights and obligations of any Holder relative to the comparable rights and obligations of the other Holders shall require
the prior written consent of such adversely affected Holder. Any change, amendment or waiver by the Company and the Required Holders shall
be binding on the Holder of this Note and all holders of the Other Notes.


 






    	 	23	 



     


    

 


16.              
Collateral. This Note and the Other Notes are secured to the extent and in the manner set forth in the Transaction
Documents (including, without limitation, the Security Agreement and the other Security Documents).


 


17.              
Transfer. This Note may be offered, sold, assigned or transferred by the Holder upon notice to, but without the consent
of, the Company, subject only to the provisions of Section 4.1 of the Securities Purchase Agreement. Any shares of Common Shares issued
upon conversion of this Note may be offered, sold, assigned or transferred by the Holder without the consent of the Company, subject only
to the provisions of Section 4.1 of the Securities Purchase Agreement.


 


18.              
Reissuances; New Notes.


 


18.1          
Transfer. If this Note is to be transferred in accordance with the terms of this Note, the Holder shall surrender this Note
to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Note (in accordance with Section 18.4),
registered as the Holder may request, representing the outstanding Principal being transferred by the Holder and, if less than the entire
outstanding Principal is being transferred, a new Note (in accordance with Section 18.4) to the Holder representing the outstanding
Principal not being transferred. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, following conversion
or redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated on
the face of this Note.


 


18.2          
Lost, Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the
Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company shall
execute and deliver to the Holder a new Note (in accordance with Section 18.4) representing the outstanding Principal.


 


18.3          
Note Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new Note or Notes (in accordance with Section 18.4) representing in the aggregate the outstanding
Principal of this Note, and each such new Note will represent such portion of such outstanding Principal as is designated by the Holder
at the time of such surrender.


 


18.4          
Issuance of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new
Note (i) shall be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining
outstanding (or in the case of a new Note being issued pursuant to Section 18.1 or Section 18.3, the Principal designated by the Holder
which, when added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal
remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated
on the face of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have the same rights and conditions as this
Note, and (v) shall represent accrued and unpaid Interest and Late Charges on the Principal and Interest of this Note, from the Issuance
Date.


 






    	 	24	 



     


    

 


19.              
Remedies, Characterizations, other Obligations, Breaches and Injunctive Relief. The remedies provided in this Note
shall be cumulative and in addition to all other remedies available under this Note and any of the other Transaction Documents at law
or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s
right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Note. No failure on the
part of the Holder to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by the Holder of any right, power or remedy preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. In addition, the exercise of any right or remedy of the Holder at law or equity or under
this Note or any of the documents shall not be deemed to be an election of Holder’s rights or remedies under such documents or at
law or equity. The Company covenants to the Holder that there shall be no characterization concerning this instrument other than as expressly
provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof)
shall be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation
of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable
harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of
any such breach or threatened breach, the Holder shall be entitled, in addition to all other available remedies, to specific performance
and/or temporary, preliminary and permanent injunctive or other equitable relief from any court of competent jurisdiction in any such
case without the necessity of proving actual damages and without posting a bond or other security. The Company shall provide all information
and documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with the
terms and conditions of this Note.


 


20.              
Payment of Collection, Enforcement and Other Costs. If (a) an Event of Default has occurred and this Note is placed
in the hands of an attorney for collection or enforcement or is collected or enforced through any legal proceeding or the Holder otherwise
takes action to collect amounts due under this Note or to enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization,
receivership of the Company or other proceedings affecting Company creditors’ rights and involving a claim under this Note, then
the Company shall pay the costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy,
reorganization, receivership or other proceeding, including, without limitation, attorneys’ fees and disbursements.


 


21.              
Construction; Headings. This Note shall be deemed to be jointly drafted by the Company and the initial Holder and
shall not be construed against any such Person as the drafter hereof. The headings of this Note are for convenience of reference and shall
not form part of, or affect the interpretation of, this Note. Unless the context clearly indicates otherwise, each pronoun herein shall
be deemed to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,”
 “include” and words of like import shall be construed broadly as if followed by the words “without limitation.”
The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Note instead
of just the provision in which they are found. Unless expressly indicated otherwise, all section references are to sections of this Note.
Terms used in this Note and not otherwise defined herein, but defined in the other Transaction Documents, shall have the meanings ascribed
to such terms on the First Closing Date in such other Transaction Documents unless otherwise consented to in writing by the Holder.


 


22.              
Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right
or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other right, power or privilege.


 






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23.              
Dispute Resolution.


 


23.1          
Submission to Dispute Resolution.


 


(a)               
In the case of a dispute relating to a Closing Bid Price, a Closing Sale Price, a Conversion Price, a VWAP or a fair market value
or the arithmetic calculation of a Conversion Rate or the applicable Redemption Price (as the case may be) (including, without limitation,
a dispute relating to the determination of any of the foregoing), the Company or the Holder (as the case may be) shall submit the dispute
to the other party via facsimile or electronic mail (A) if by the Company, within five (5) Business Days after the occurrence of the circumstances
giving rise to such dispute or (B) if by the Holder, within five (5) Business Days after the Holder learned of the circumstances giving
rise to such dispute. If the Holder and the Company are unable to promptly resolve such dispute relating to such Closing Bid Price, such
Closing Sale Price, such Conversion Price, such VWAP or such fair market value, or the arithmetic calculation of such Conversion Rate
or such applicable Redemption Price (as the case may be), at any time after the second (2nd) Business Day following such initial
notice by the Company or the Holder (as the case may be) of such dispute to the Company or the Holder (as the case may be), then then
the Holder may, with the consent of the Company not to be unreasonably or untimely withheld, select an independent, reputable investment
bank to resolve such dispute.


 


(b)               
The Holder and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered
in accordance with the first sentence of this Section 23 and (B) written documentation supporting its position with respect to such dispute,
in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following the date on which
the Holder selected such investment bank (the “Dispute Submission Deadline”) (the documents referred to in the
immediately preceding clauses (A) and (B) are collectively referred to herein as the “Required Dispute Documentation”)
(it being understood and agreed that if either the Holder or the Company fails to so deliver all of the Required Dispute Documentation
by the Dispute Submission Deadline, then the party who fails to so submit all of the Required Dispute Documentation shall no longer be
entitled to (and hereby waives its right to) deliver or submit any written documentation or other support to such investment bank with
respect to such dispute and such investment bank shall resolve such dispute based solely on the Required Dispute Documentation that was
delivered to such investment bank prior to the Dispute Submission Deadline). Unless otherwise agreed to in writing by both the Company
and the Holder or otherwise requested by such investment bank, neither the Company nor the Holder shall be entitled to deliver or submit
any written documentation or other support to such investment bank in connection with such dispute (other than the Required Dispute Documentation).


 


(c)               
The Company and the Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company
and the Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The reasonable
fees and reasonable expenses of such investment bank shall be borne solely by the Company, and such investment bank’s resolution
of such dispute shall be final and binding upon all parties absent manifest error. 


 


23.2          
Miscellaneous. The Company expressly acknowledges and agrees that (i) this Section 23 constitutes an agreement to arbitrate
between the Company and the Holder (and constitutes an arbitration agreement) under § 7501, et seq. of the New York Civil Practice
Law and Rules (“CPLR”) and that the Holder is authorized to apply for an order to compel arbitration pursuant
to CPLR § 7503(a) in order to compel compliance with this Section 23, (ii) a dispute relating to a Conversion Price includes, without
limitation, disputes as to (A) whether an issuance or sale or deemed issuance or sale of Common Shares occurred under Section 6 or 7,
(B) the consideration per share at which an issuance or deemed issuance of Common Shares occurred, and (C) whether an agreement, instrument,
security or the like constitutes and Option or Convertible Security, (iii) the terms of this Note and each other applicable Transaction
Document shall serve as the basis for the selected investment bank’s resolution of the applicable dispute, such investment bank
shall be entitled (and is hereby expressly authorized) to make all findings, determinations and the like that such investment bank determines
are required to be made by such investment bank in connection with its resolution of such dispute and in resolving such dispute such investment
bank shall apply such findings, determinations and the like to the terms of this Note and any other applicable Transaction Documents,
(iv) the Holder (and only the Holder), in its sole discretion, shall have the right to submit any dispute described in this Section 23
to any state or federal court sitting in The City of New York, Borough of Manhattan in lieu of utilizing the procedures set forth in this
Section 23 and (v) nothing in this Section 23 shall limit the Holder from obtaining any injunctive relief or other equitable remedies
(including, without limitation, with respect to any matters described in this Section 23).


 






    	 	26	 



     


    

 


23.3          
Pendency of Dispute. Notwithstanding anything to the contrary set forth herein, during either (i) the pendency of any dispute
under this Section 23 with respect to either (A) whether the existence or continuation of an Event of Default has occurred, or (B) whether
the conditions to a Company Optional Redemption pursuant to Section 8 have been satisfied, or (ii) the time that both an Event of Default
is continuing and the pendency of any other dispute under this Section 23, with the prior written consent of the Holder, the Company shall
not be permitted to exercise its rights under Section 8 and no Company Optional Redemption pursuant to Section 8 shall be effective.


 


24.              
Notices; Currency; Payments.


 


24.1          
Notices. Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be
given in accordance with Section 8.4 of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice
of all actions taken pursuant to this Note, including in reasonable detail a description of such action and the reason therefore. Without
limiting the generality of the foregoing, the Company will give written notice to the Holder (i) immediately upon any adjustment of the
Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen (15)
days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the
Common Shares, (B) with respect to any grant, issuances, or sales of any Options, Convertible Securities or rights to purchase shares,
stock, warrants, securities or other property to all or substantially all of the holders of shares of Common Shares or (C) for determining
rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall
be made known to the public prior to or in conjunction with such notice being provided to the Holder.


 


24.2          
Currency. All dollar amounts referred to in this Note are in United States Dollars (“U.S. Dollars”),
and all amounts owing under this Note shall be paid in U.S. Dollars. All amounts denominated in other currencies (if any) shall be converted
into the U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate”
means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Note, the U.S. Dollar exchange rate as
published in the Wall Street Journal on the relevant date of calculation (it being understood and agreed that where an amount is calculated
with reference to, or over, a period of time, the date of calculation shall be the final date of such period of time).


 






    	 	27	 



     


    

 


24.3          
Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, such payment shall
be made in lawful money of the United States of America by a check drawn on the account of the Company and sent via overnight courier
service to such Person at such address as previously provided to the Company in writing (which address, in the case of each of the Purchasers,
shall initially be as set forth on the Schedule of Investors attached to the Securities Purchase Agreement); provided, that the Holder
may elect to receive a payment of cash via wire transfer of immediately available funds by providing the Company with prior written notice
setting out such request and the Holder’s wire transfer instructions. Whenever any amount expressed to be due by the terms of this
Note is due on any day which is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day.
Any amount of Principal or other amounts due under the Transaction Documents which is not paid when due shall result in a late charge
being incurred and payable by the Company in an amount equal to interest on such amount at the rate of thirteen percent (13.0%) per annum
from the date such amount was due until the same is paid in full (“Late Charge”).


 


25.              
Cancellation. After all Principal, accrued Interest, Late Charges and other amounts at any time owed on this Note
have been satisfied in full, this Note shall automatically be deemed canceled, shall be surrendered to the Company for cancellation and
shall not be reissued.


 


26.              
Waiver of Notice. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment,
protest and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Note
and the Securities Purchase Agreement.


 


27.              
Governing Law. This Note shall be construed and enforced in accordance with, and all questions concerning the construction,
validity, interpretation and performance of this Note shall be governed by, the internal laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York. Except as otherwise required by Section 23 above,
the Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York,
Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or
that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. Nothing contained herein (i) shall be deemed or operate to preclude the Holder from bringing suit or taking
other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to the Holder, to realize
on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling in favor of the Holder or
(ii) shall limit, or shall be deemed or construed to limit, any provision of Section 23. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING
OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY.


 






    	 	28	 



     


    

 


28.              
Attorneys’ Fees. In the event any legal action or other proceeding is brought by one party against the other
party to enforce any provision of this Note or in which the subject matter of such legal action or other proceeding arises under, or is
with respect to, the provisions of this Note, the prevailing party in any such legal action or other proceeding is entitled to recover
from the other party attorneys’ fees and costs associated with defending or prosecuting such legal action or other proceeding, any
appeal therefrom, and any ancillary or related proceedings.


 


29.              
Severability. If any provision of this Note is prohibited by law or otherwise determined to be invalid or unenforceable
by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended
to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall
not affect the validity of the remaining provisions of this Note so long as this Note as so modified continues to express, without material
change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties or
the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith
negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as
close as possible to that of the prohibited, invalid or unenforceable provision(s).


 


30.              
Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless
the Company has in good faith determined that the matters relating to such notice do not constitute material, nonpublic information relating
to the Company or its Subsidiaries, the Company shall within one (1) Business Day after any such receipt or delivery publicly disclose
such material, nonpublic information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice
contains material, nonpublic information relating to the Company or its Subsidiaries, the Company so shall indicate to such Holder contemporaneously
with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters relating
to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries.


 


31.              
Usury. This Note is subject to the express condition that at no time shall the Company be obligated or required to
pay interest hereunder at a rate or in an amount which could subject the Holder to either civil or criminal liability as a result of being
in excess of the maximum interest rate or amount which the Company is permitted by applicable law to contract or agree to pay. If by the
terms of this Note, the Company is at any time required or obligated to pay interest hereunder at a rate or in an amount in excess of
such maximum rate or amount, the rate or amount of interest under this Note shall be deemed to be immediately reduced to such maximum
rate or amount and the interest payable shall be computed at such maximum rate or be in such maximum amount and all prior interest payments
in excess of such maximum rate or amount shall be applied and shall be deemed to have been payments in reduction of the principal balance
of this Note.


 


32.              
Definitions. As used in this Note, the following terms shall have the following meanings:


 


32.1          
“Acquisition” has the meaning specified in Section 13.6.


 


32.2          
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls,
is controlled by, or is under common control with, such Person, it being understood for purposes of this definition that “control”
of a Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election
of directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.


 






    	 	29	 



     


    

 


32.3          
“Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle,
including, any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly
managed or advised by the Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates
of the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder
or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common Shares would or could be aggregated
with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the Exchange Act. For clarity, the purpose
of the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.


 


32.4          
“Authorized Share Allocation” has the meaning specified in Section 10.1.


 


32.5          
“Authorized Share Failure” has the meaning specified in Section 10.2.


 


32.6          
“Automatic Conversion Event” means that, as of any Company Optional
Redemption Date, the Automatic Conversion Reference Price as of such Company Option Redemption Date shall be in excess of the product
of (x) 120%, times (y) the Conversion Price as of such Company Option Redemption Date.


 


32.7          
“Automatic Conversion Reference Price” means, as of Company Optional Redemption Date, the VWAP of the
Common Shares for the five (5) Trading Days ending at the close of business on the Principal Market on the Trading Day immediately prior
to such Company Optional Redemption Date.


 


32.8          
“Bankruptcy Event of Default” has the meaning specified in Section 4.1.


 


32.9          
“Business Day” means any day other than Saturday, Sunday, any day which shall be 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.


 


32.10       
“Calendar Quarter” means each of: (i) the period beginning on and including January 1 and ending
on and including the next occurring March 31; (ii) the period beginning on and including April 1 and ending on and including the
next occurring June 30; (iii) the period beginning on and including July 1 and ending on and including the next occurring September
30; (iv) and the period beginning on and including October 1 and ending on and including the next occurring December 31.


 


32.11       
“Cash Interest” has the meaning specified in the preamble to this Note.


 


32.12       
“Cash Interest Rate” means, as of any date, an annual rate per annum equal to the sum of (i) the greater
of (x) the Prime Rate as of such date, and (y) 3.50%, plus (ii) 1.00%, plus (iii) at all times on or after August 19, 2024, 3.50%; provided,
that, on any date when an Event of Default shall have occurred and be continuing, the “Cash Interest Rate” shall be the “Cash
Interest Rate” determined in accordance with the foregoing plus 2.00%.


 


32.13       
“Change of Control” means any Fundamental Transaction other than (i) any reorganization, recapitalization
or reclassification of the shares of Common Shares in which holders of the Company’s voting power immediately prior to such reorganization,
recapitalization or reclassification continue after such reorganization, recapitalization or reclassification to hold publicly traded
securities and, directly or indirectly, are, in all material respects, the holders of the voting power of the surviving entity (or entities
with the authority or voting power to elect the members of the board of directors (or their equivalent if other than a corporation)
of such entity or entities) after such reorganization, recapitalization or reclassification, or (ii) pursuant to a migratory merger effected
solely for the purpose of changing the jurisdiction of incorporation of the Company or any of its Subsidiaries.


 






    	 	30	 



     


    

 


32.14       
“Change of Control Date” has the meaning specified in Section 5.2.


 


32.15       
“Change of Control Notice” has the meaning specified in Section 5.2.


 


32.16       
“Change of Control Redemption Date” has the meaning specified in Section 11.1.


 


32.17       
“Change of Control Redemption Notice” has the meaning specified in Section 5.2.


 


32.18       
“Change of Control Redemption Price” has the meaning specified in Section 5.2.


 


32.19       
“Closing Bid Price” and “Closing Sale Price” means, for any security as of
any date, the last closing bid price and last closing trade price, respectively, for such security on the Principal Market, as reported
by FactSet, or, if the Principal Market begins to operate on an extended hours basis and does not designate the closing bid price or the
closing trade price (as the case may be) then the last bid price or last trade price, respectively, of such security prior to 4:00:00
p.m., New York time, as reported by FactSet, or, if the Principal Market is not the principal securities exchange or trading market for
such security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or
trading market where such security is listed or traded as reported by FactSet, or if the foregoing do not apply, the last closing bid
price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such security
as reported by FactSet, or, if no closing bid price or last trade price, respectively, is reported for such security by FactSet, the average
of the bid prices, or the ask prices, respectively, of any market makers for such security as reported in the “pink sheets”
by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the Closing Bid Price or the Closing Sale Price cannot be calculated for a security
on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price (as the case may be) of such security
on such date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable
to agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section
23. All such determinations shall be appropriately adjusted for any share splits, share dividends, share combinations, recapitalizations
or other similar transactions during such period.


 


32.20       
“Common Shares” means (i) shares of Common Shares, no par value, of the Company, and (ii) any
share capital into which such Common Shares shall be changed or any share capital resulting from a reclassification of such Common Shares.


 


32.21       
“Company” has the meaning specified in the preamble to this Note.


 


32.22       
“Company Optional Redemption” has the meaning specified in Section 8.1.


 


32.23       
“Company Optional Redemption Amount” has the meaning specified in Section 8.1.


 


32.24       
“Company Optional Redemption Date” has the meaning specified in Section 8.1.


 


32.25       
“Company Optional Redemption Notice” has the meaning specified in Section 8.1.


 






    	 	31	 



     


    

 


32.26       
“Company Optional Redemption Notice Date” has the meaning specified in Section 8.1.


 


32.27       
“Company Optional Redemption Price” has the meaning specified in Section 8.1.


 


32.28       
“Conversion Amount” means the sum of (w) the portion of the Principal to be converted, redeemed or otherwise
with respect to which this determination is being made, (x) all accrued and unpaid Interest with respect to such portion of the Principal
amount, (y) accrued and unpaid Late Charges with respect to such portion of such Principal and such Interest, if any, and (z) solely with
respect to any conversion of the Notes following the delivery by the Company of a Company Optional Redemption Notice under Section 8.1,
an amount equal to (i) the Redemption Premium as of such date of conversion minus 100%, multiplied by (ii) the Principal being converted.


 


32.29       
“Conversion Date” has the meaning specified in Section 3.3(a).


 


32.30       
“Conversion Notice” has the meaning specified in Section 3.3(a).


 


32.31       
“Conversion Price” means, as of any Conversion Date or other date of determination, $7.89, subject to
adjustment as provided herein.


 


32.32       
“Conversion Rate” has the meaning specified in Section 3.2.


 


32.33       
“Convertible Securities” means any shares, stock or other security (other than Options) that is at any
time and under any circumstances, directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles
the holder thereof to acquire, any shares of Common Shares.


 


32.34       
“Corporate Event” has the meaning specified in Section 6.2.


 


32.35       
“Current Public Information Failure” has the meaning specified in the Securities Purchase Agreement.


 


32.36       
“Distributions” has the meaning specified in Section 14.


 


32.37       
“Dispute Submission Deadline” has the meaning specified in Section 23.1(b).


 


32.38       
“DTC” has the meaning specified in Section 3.3(a).


 


32.39       
“Effectiveness Deadline” has the meaning specified in the Securities Purchase Agreement.


 


32.40       
“Eligible Market” means the NYSE American, New York Stock Exchange, the NYSE MKT, the Nasdaq Global Select
Market, the Nasdaq Global Market, the Nasdaq Capital Market or the OTCBB.


 






    	 	32	 



     


    

 


32.41       
“Equity Conditions” means, with respect to an given date of determination: (i) on each day during the
period beginning thirty (30) calendar days prior to such applicable date of determination and ending on and including such applicable
date of determination either (x) to the extent that a Registration Statement shall have been required to filed pursuant to the Securities
Purchase Agreement, one or more Registration Statements filed pursuant to the Securities Purchase Agreement shall be effective and the
prospectus contained therein shall be available on such applicable date of determination (with, for the avoidance of doubt, any shares
of Common Shares previously sold pursuant to such prospectus deemed unavailable) for the resale of all shares of Common Shares issuable
upon conversion of this Note and the Other Notes (each, a “Required Minimum Securities Amount”), in each case,
in accordance with the terms of the Securities Purchase Agreement or (y) all Registrable Securities in respect of this Note and the Other
Notes shall be eligible for sale pursuant to Rule 144 without the need for registration under any applicable federal or state securities
laws (in each case, disregarding any limitation on conversion of the Notes or other issuance of securities with respect to the Notes)
and no Current Public Information Failure exists or is continuing; (ii) on each day during the period beginning thirty (30) calendar days
prior to the applicable date of determination and ending on and including the applicable date of determination (the “Equity
Conditions Measuring Period”), the Common Shares (including all Registrable Securities in respect of this Note and the Other
Notes) is listed or designated for quotation (as applicable) on an Eligible Market and shall not have been suspended from trading on an
Eligible Market (other than suspensions of not more than two (2) days and occurring prior to the applicable date of determination due
to business announcements by the Company) nor shall delisting or suspension by an Eligible Market have been threatened (with a reasonable
prospect of delisting occurring after giving effect to all applicable notice, appeal, compliance and hearing periods) or reasonably likely
to occur or pending as evidenced by (A) a writing by such Eligible Market or (B) the Company falling below the minimum listing maintenance
requirements of the Eligible Market on which the Common Shares is then listed or designated for quotation (as applicable); (iii) during
the Equity Conditions Measuring Period, the Company shall have delivered all shares of Common Shares issuable upon conversion of this
Note on a timely basis as set forth in Section 3 hereof and all other shares of capital stock required to be delivered by the Company
on a timely basis as set forth in the other Transaction Documents; (iv) any shares of Common Shares to be issued in connection with the
event requiring determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring this determination)
may be issued in full without violating Section 3.4 hereof; (v) any shares of Common Shares to be issued in connection with the event
requiring determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring this determination
at the Conversion Price then in effect (without regard to any limitations on conversion set forth herein)) may be issued in full without
violating the rules or regulations of the Eligible Market on which the Common Shares is then listed or designated for quotation (as applicable);
(vi) on each day during the Equity Conditions Measuring Period, (x) no public announcement of a pending, proposed or intended Fundamental
Transaction shall have occurred which has not been abandoned, terminated or consummated and (y) and no pending or proposed Fundamental
Transaction shall have been under consideration or negotiation by the Board of Directors of the Company; (vii) the Company shall have
no knowledge of any fact that would reasonably be expected to cause (1) any Registration Statement required to be filed pursuant to the
Securities Purchase Agreement to not be effective or the prospectus contained therein to not be available for the resale of the applicable
Required Minimum Securities Amount of Registrable Securities in respect of this Note and the Other Notes in accordance with the terms
of the Securities Purchase Agreement or (2) any Registrable Securities in respect of this Note and the Other Notes to not be eligible
for sale pursuant to Rule 144 without the need for registration under any applicable federal or state securities laws (in each case, disregarding
any limitation on conversion of the Notes or other issuance of securities with respect to the Notes) and no Current Public Information
Failure exists or is continuing; (viii) on each day during the Equity Conditions Measuring Period, the Company otherwise shall have been
in compliance with each, and shall not have breached any representation or warranty in any material respect (other than representations
or warranties subject to material adverse effect or materiality, which may not be breached in any respect) or any covenant or other term
or condition of any Transaction Document, including, without limitation, the Company shall not have failed to timely make any payment
pursuant to any Transaction Document; (ix) on the applicable date of determination (A) no Authorized Share Failure shall exist or be continuing
and the applicable Required Minimum Securities Amount of shares of Common Shares are available under the certificate of incorporation
of the Company and reserved by the Company to be issued pursuant to the Notes and (B) all shares of Common Shares to be issued in connection
with the event requiring this determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring
this determination at the Conversion Price then in effect (without regard to any limitations on conversion set forth herein)) may be issued
in full without resulting in an Authorized Share Failure; (x) on each day during the Equity Conditions Measuring Period, there shall not
have occurred and there shall not exist an Event of Default or an event that with the passage of time or giving of notice would constitute
an Event of Default; (xi) no bona fide dispute shall exist, by and between any of holder of Notes, the Company, the Principal Market (or
such applicable Eligible Market in which the Common Shares of the Company is then principally trading) and/or FINRA with respect to any
term or provision of any Note or any other Transaction Document; and (xii) the shares of Common Shares issuable pursuant the event requiring
the satisfaction of the Equity Conditions (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring
this determination at the Conversion Price then in effect (without regard to any limitations on conversion set forth herein)) are duly
authorized and listed and eligible for trading without restriction on an Eligible Market.


 






    	 	33	 



     


    

 


32.42       
“Equity Conditions Failure” means, as applicable, that (i) on any day during the period commencing twenty
(20) Trading Days prior to the applicable Company Optional Redemption Notice Date through the applicable Company Optional Redemption Date
or (ii) with respect to any other date of determination, any day during the period commencing twenty (20) Trading Days prior to such date
of determination, the Equity Conditions have not been satisfied (or waived in writing by the Holder).


 


32.43       
“Event of Default” has the meaning specified in Section 4.1.


 


32.44       
“Event of Default Notice” has the meaning specified in Section 4.2.


 


32.45       
“Event of Default Redemption Date” has the meaning specified in Section 11.1.


 


32.46       
“Event of Default Redemption Notice” has the meaning specified in Section 4.2.


 


32.47       
“Event of Default Redemption Price” has the meaning specified in Section 4.2.


 


32.48       
“Event of Default Right Expiration Date” has the meaning specified in Section 4.2.


 


32.49       
“Excess Shares” has the meaning specified in Section 3.4.


 


32.50       
“Exchange Act” means the Securities Exchange Act of 1934, as amended.


 


32.51       
“FDA Approval” has the meaning specified in the Securities Purchase Agreement.


 


32.52       
“Federal Funds Effective Rate” means, for any day, the weighted average of the rates on overnight Federal
funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the
quotations for such day for such transactions received by the Holder from three Federal funds brokers of recognized standing reasonably
selected by it.


 


32.53       
“Filing Deadline” has the meaning specified in the Securities Purchase Agreement.


 






    	 	34	 



     


    

 


32.54       
“First Closing Date” has the meaning specified in the Securities Purchase Agreement.


 


32.55       
“First Closing Notes” shall have the meaning as set forth in the Securities Purchase Agreement.


 


32.56       
“Fourth Closing Notes” has the meaning specified in the Securities Purchase Agreement.


 


32.57       
“Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through
any of its subsidiaries, Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether
or not the Company is the surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of
all or substantially all of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in
Rule 1-02 of Regulation S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the
Company to be subject to or have its Common Shares be subject to or party to one or more Subject Entities making, a purchase, tender or
exchange offer that is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Shares, (y) 50% of the outstanding
shares of Common Shares calculated as if any shares of Common Shares held by all Subject Entities making or party to, or Affiliated with
any Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of
Common Shares such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase,
tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of at least 50%
of the outstanding shares of Common Shares, or (iv) consummate a stock or share purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all
such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of Common Shares,
(y) at least 50% of the outstanding shares of Common Shares calculated as if any shares of Common Shares held by all the Subject Entities
making or party to, or Affiliated with any Subject Entity making or party to, such stock or share purchase agreement or other business
combination were not outstanding; or (z) such number of shares of Common Shares such that the Subject Entities become collectively the
beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of at least 50% of the outstanding shares of Common Shares, or (v)
reorganize, recapitalize or reclassify its Common Shares, (B) that the Company shall, directly or indirectly, including through any of
its subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities
in the aggregate to be or become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
whether through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common
Shares, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization,
recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary voting
power represented by issued and outstanding Common Shares, (y) at least 50% of the aggregate ordinary voting power represented by issued
and outstanding Common Shares not held by all such Subject Entities as of the date of this Note calculated as if any shares of Common
Shares held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented
by issued and outstanding shares of Common Shares or other equity securities of the Company sufficient to allow such Subject Entities
to effect a statutory short form merger or other transaction requiring other shareholders of the Company to surrender their shares of
Common Shares without approval of the shareholders of the Company or (C) directly or indirectly, including through subsidiaries, Affiliates
or otherwise, in one or more related transactions, the issuance of or the entering into any other instrument or transaction structured
in a manner to circumvent, or that circumvents, the intent of this definition in which case this definition shall be construed and implemented
in a manner otherwise than in strict conformity with the terms of this definition to the extent necessary to correct this definition or
any portion of this definition which may be defective or inconsistent with the intended treatment of such instrument or transaction.


 






    	 	35	 



     


    

 


32.58       
“GAAP” means United States generally accepted accounting principles, consistently applied.


 


32.59       
“Guaranty Agreement” shall have the meaning as set forth in the Securities Purchase Agreement.


 


32.60       
“Group” means a “group” as that term is used in Section 13(d) of the Exchange Act and as
defined in Rule 13d-5 thereunder.


 


32.61       
“Holder” has the meaning specified in the preamble to this Note.


 


32.62       
“Indebtedness” means, with respect to any Person, without duplication (A) all indebtedness for borrowed
money, (B) all obligations issued, undertaken or assumed as the deferred purchase price of property or services (other than trade payables
entered into in the ordinary course of business), (C) all reimbursement or payment obligations with respect to letters of credit, surety
bonds and other similar instruments, (D) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations
so evidenced incurred in connection with the acquisition of property, assets or businesses, (E) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to any property or assets
acquired with the proceeds of such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the
event of default are limited to repossession or sale of such property), (F) all monetary obligations under any leasing or similar arrangement
which, in connection with generally accepted accounting principles, consistently applied for the periods covered thereby, is classified
as a capital lease, and (G) all indebtedness referred to in clauses (A) through (F) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, lien, pledge, charge, security interest or
other encumbrance upon or in any property or assets (including accounts and contract rights) owned by such Person, even though such Person
which owns such assets or property has not assumed or become liable for the payment of such indebtedness.


 


32.63       
“Intellectual Property” means all patents, trademarks, service marks, logos and other business identifiers,
trade names, trade styles, trade dress, copyrights, proprietary know-how, processes, computer software and all registrations, applications
and licenses therefor.


 


32.64       
“Interest” has the meaning specified in the preamble to this Note.


 


32.65       
“Interest Date” has the meaning specified in Section 2.1.


 


32.66       
“Investment” means, with respect to any Person, any loan, advance or extension of credit (other than
to customers in the ordinary course of business) by such Person to, or any guarantee of any obligation of or other contingent liability
with respect to the capital stock, Indebtedness or other obligations of, or any contributions to the capital of, any other Person, or
any ownership, purchase or other acquisition by such Person of any interest in any capital stock, limited partnership interest, general
partnership interest, or other securities of any such other Person.


 


32.67       
“Investor Label Approval Notice” has the meaning specified in the Securities Purchase Agreement.


 






    	 	36	 



     


    

 


32.68       
“Issuance Date” has the meaning specified in the preamble to this Note.


 


32.69       
“Late Charge” has the meaning specified in Section 24.3.


 


32.70       
“Lien” has the meaning specified in Section 13.3.


 


32.71       
“Liquidity” means, as of any date, an amount equal to the aggregate amount of the unrestricted cash of
the Company and the Subsidiary Guarantors (excluding for this purpose cash held in restricted accounts or otherwise unavailable for unrestricted
use by the Company or any of the Subsidiary Guarantors for any reason) as of such date of determination held in bank accounts of financial
banking institutions in Canada or the United States of America.


 


32.72       
“Maturity Date” shall mean August 19, 2027; provided, however, the Maturity Date may be extended at the
option of the Holder (i) in the event that, and for so long as, an Event of Default shall have occurred and be continuing or any event
shall have occurred and be continuing that with the passage of time and the failure to cure would result in an Event of Default or (ii)
through the date that is the earlier of the consummation or, to the extent that the Maturity Date had previously been extended upon the
public announcement of a Fundamental Transaction, termination of a Fundamental Transaction in the event that a Fundamental Transaction
is publicly announced or a Change of Control Notice is delivered prior to the Maturity Date; provided further that if a Holder elects
to convert a portion of this Note pursuant to Section 3 hereof that represents the maximum Conversion Amount permitted under Section 3.4
at such time, and the Conversion Amount remains limited pursuant to Section 3.4 hereunder as at the Maturity Date, the Maturity Date may
be extended at the option of the Holder until such time as such provision shall not limit the conversion of this Note.


 


32.73       
“Maximum Percentage” has the meaning specified in Section 3.4.


 


32.74       
“Note” has the meaning specified in the preamble to this Note.


 


32.75       
“Options” means any rights, warrants, grants or options to subscribe for or purchase shares of Common
Shares or Convertible Securities.


 


32.76       
“Other Notes” has the meaning specified in the preamble to this Note.


 


32.77       
“Other Redemption Notice” has the meaning specified in Section 11.2.


 


32.78       
“Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person
and whose Common Shares or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person
or Parent Entity, the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental
Transaction.


 


32.79       
“Permitted Indebtedness” means (i) Indebtedness evidenced by this Note, the Other Notes, any Senior Secured
Convertible Notes issued pursuant to the Securities Purchase Agreement prior to the Issuance Date that are referred to in the Securities
Purchase Agreement as the First Closing Notes, and any Senior Secured Convertible Notes issued pursuant to the Securities Purchase Agreement
following the Issuance Date that are referred to in the Securities Purchase Agreement as the Third Closing Notes or Fourth Closing Notes,
(ii) Indebtedness secured by Permitted Liens under clause (iii) of the definition of Permitted Liens in an aggregate amount outstanding
not to exceed $250,000, (iii) Indebtedness incurred in the ordinary course of business, not to exceed $100,000 in any one transaction
or $250,000 in the aggregate outstanding at any time, and (iv) any unsecured Indebtedness, so long as the aggregate amount of Indebtedness
at any time outstanding under this clause (iv) shall not exceed $250,000.


 






    	 	37	 



     


    

 


32.80       
“Permitted Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith
by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, (ii) any Lien created by operation
of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business
with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings, (iii)
Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries to secure the purchase price of such equipment
or Indebtedness incurred solely for the purpose of financing the acquisition or lease of such equipment, (B) existing on such equipment
at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and improvements thereon, or (C)
in respect of capitalized lease obligations, provided that the Lien is confined solely to the property leased by the Company or any of
its Subsidiaries pursuant to the applicable capital lease, in the case of any of clause (A), (B) or (C), with respect to Indebtedness
in an aggregate amount not to exceed $250,000, and (iv) Liens in favor of customs and revenue authorities arising as a matter of law to
secure payments of custom duties in connection with the importation of goods.


 


32.81       
“Permitted Securities Transaction” has the meaning specified in Section 3.3(a).


 


32.82       
“Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation,
a trust, an unincorporated organization, a government or any department or agency thereof and any other legal entity.


 


32.83       
“PIK Interest” has the meaning specified in the preamble to this Note.


 


32.84       
“Prime Rate” means, as of any date, the rate quoted by The Wall Street Journal as the “Prime Rate”
in the United States on such date.


 


32.85       
“Principal” has the meaning specified in the preamble to this Note.


 


32.86       
“Principal Market” means the Nasdaq Capital Market.


 


32.87       
“Redemption Automatic Conversion” has the meaning specified in Section 8.1(c)(iii).


 


32.88       
“Redemption Date” means, as applicable, the Event of Default Redemption Date, the Change of Control Redemption
Date or Company Optional Redemption Date.


 


32.89       
“Redemption Notice” means, as applicable, an Event of Default Redemption Notice, a Company Optional Redemption
Notices and a Change of Control Redemption Notice.


 


32.90       
“Redemption Premium” means:


 


		(a)	as of any date after August 19, 2025 but prior to August 19, 2026, the sum of (i) 100.00%, plus (ii) 10.00%;
and



 


		(b)	as of any date on or after August 19, 2026, the sum of (i) 100.00%, plus (ii) 7.50%.



 






    	 	38	 



     


    

 


32.91       
“Redemption Price” means, as applicable, the Event of Default Redemption Price, the Change of Control
Redemption Price and the Company Optional Redemption Price.


 


32.92       
“Register” has the meaning specified in Section 3.3(c).


 


32.93       
“Registered Notes” has the meaning specified in Section 3.3(c).


 


32.94       
“Registrable Securities” has the meaning specified in the Securities Purchase Agreement.


 


32.95       
“Registration Statement” has the meaning specified in the Securities Purchase Agreement.


 


32.96       
“Regulatory Authorizations” means all governmental licenses, authorizations, registrations, permits,
consents and approvals required under all applicable laws and regulations in order to carry on the business of the Company and its Subsidiaries
as currently conducted or proposed to be conducted, including any newly introduced or revised applicable laws and regulations as they
may become introduced, altered or otherwise evolve over time.


 


32.97       
“Reported Outstanding Share Number” has the meaning specified in Section 3.4.


 


32.98       
“Required Dispute Documentation” has the meaning specified in Section 23.1(b).


 


32.99       
“Required Holders” means the holders of Notes (including the Other Notes) representing at least a majority
of the aggregate principal amount of the Notes (including the Other Notes) then outstanding.


 


32.100   
“Required Reserve Amount” has the meaning specified in Section 10.1.


 


32.101   
“Restricted Payment” has the meaning specified in Section 13.4.


 


32.102   
“Rule 144” has the meaning specified in the Securities Purchase Agreement.


 


32.103   
“SEC” means the United States Securities and Exchange Commission or the successor thereto.


 


32.104   
“Securities Purchase Agreement” means that certain Securities Purchase Agreement, dated as of August
1, 2022, among the Company and the investors identified therein, pursuant to which the Company issued, among other securities, the Notes,
as such agreement may be amend, restated or otherwise modified from time to time.


 


32.105   
“Security Agreement” shall have the meaning as set forth in the Securities Purchase Agreement.


 


32.106   
“Security Documents” shall have the meaning as set forth in the Securities Purchase Agreement.


 


32.107   
“Share Delivery Deadline” has the meaning specified in Section 3.3(a).


 






    	 	39	 



     


    

 


32.108   
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person,
Persons or Group.


 


32.109   
“Subsidiary” means any Person in which the Company, directly or indirectly, (i) owns more than 50% of
the outstanding capital stock or any equity or similar interest of such Person or (ii) controls or operates all or any part of the business,
operations or administration of such Person.


 


32.110   
“Subsidiary Guarantor” means each Subsidiary of the Company that is, or that becomes, (i) a party to
the Guaranty Agreement as a “Subsidiary Guarantor” thereunder, and (ii) a party to the Security Agreement as a “Grantor”
thereunder.


 


32.111   
“Successor Entity” means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting
from or surviving any Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such Fundamental
Transaction shall have been entered into.


 


32.112   
“Third Closing Notes” has the meaning specified in the Securities Purchase Agreement.


 


32.113   
“Trading Day” has the meaning specified in the Securities Purchase Agreement.


 


32.114   
“Transaction Documents” means the Securities Purchase Agreement, including the schedules, annexes and
exhibits attached hereto, the Notes, the Security Agreement, the other Security Documents and each of the other agreements or instruments
entered into or executed by the parties hereto in connection with the transactions contemplated by the Securities Purchase Agreement.


 


32.115   
“Transfer Agent” has the meaning specified in Section 3.1.


 


32.116   
“VWAP” means, for any security as of any date or period, the dollar volume-weighted average price for
such security on the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the
principal securities exchange or securities market on which such security is then traded) during the period beginning at 9:30:01 a.m.,
New York time, and ending at 4:00:00 p.m., New York time, as reported by FactSet or, if the foregoing does not apply, the dollar volume-weighted
average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning
at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by FactSet, or, if no dollar volume-weighted average
price is reported for such security by FactSet for such hours, the average of the highest closing bid price and the lowest closing ask
price of any of the market makers for such security as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink
Sheets LLC). If the VWAP cannot be calculated for such security on such date or period on any of the foregoing bases, the VWAP of such
security on such date or period shall be the fair market value as mutually determined by the Company and the Holder. If the Company and
the Holder are unable to agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the
procedures in Section 23. All such determinations shall be appropriately adjusted for any share dividend, share split, share combination,
recapitalization or other similar transaction during such period.


 


[Signature Page Follows]


 


 




    	 	40	 



     


    


 


IN WITNESS WHEREOF, the Company
has executed this Senior Secured Convertible Note as of the Issuance Date set out above.


  





	 	Fennec Pharmaceuticals Inc.
	 	 	 
	 	 	 
	 	By:	 /s/ Robert Andrade
	 	Name:	Robert Andrade

	 	Title:	CFO





  


Accepted and Agreed:


 


PETRICHOR OPPORTUNITIES FUND I LP


By PETRICHOR OPPORTUNITIES FUND I GP LLC


 


 


	By: 	/s/ Tadd Wessel	 





Name: Tadd Wessel


Title: Managing Member


 




     

     


    


EXHIBIT I


 


Fennec
Pharmaceuticals Inc.

CONVERSION NOTICE


 


Reference is made to the Senior
Secured Convertible Note (the “Note”) issued to the undersigned by Fennec Pharmaceuticals Inc., a British Columbia
corporation (the “Company”). In accordance with and pursuant to the Note, the undersigned hereby elects to convert
the Conversion Amount (as defined in the Note) of the Note indicated below into shares of Common Shares, no par value (the “Common
Shares”), of the Company, as of the date specified below. Capitalized terms not defined herein shall have the meaning as
set forth in the Note.


 


 


Date of Conversion:___________________________________________________________________


 


Aggregate Principal to be converted:_______________________________________________________






 


Aggregate accrued and unpaid
Interest


and accrued and unpaid Late
Charges


with respect to such portion
of the


Principal and such Interest
to be converted:______________________________________


 


AGGREGATE CONVERSION AMOUNTTO
BE CONVERTED:_______________________________


 



Please confirm the following information:


 


Conversion Price:________________________________________________________________________


 


Number of shares of Common Shares to be issued
(the “Shares”):____________________________________









 


		 ̈	Check here if the Holder does not intend to resell the Shares to be issued either (x) prior to, (y) contemporaneously
with or (z) no later than thirty days after, as applicable, the date of this Conversion Notice



 


Notwithstanding anything to the contrary contained
herein, unless the Holder shall have checked the box above, the Holder agrees to notify the Company in the event that the Holder has not
resold the Shares to be issued on or prior to thirty days after the date of this Conversion Notice.


 


Notwithstanding anything to the contrary contained
herein, this Conversion Notice shall constitute a representation by the Holder of the Note submitting this Conversion Notice that after
giving effect to the Conversion provided for in this Conversion Notice, such Holder (together with its Attribution Parties) will not have
beneficial ownership (together with the beneficial ownership of such Person’s Attribution Parties) of a number of shares Common
Shares which exceeds the Maximum Percentage (as defined in the Note) of the total outstanding shares of Common Shares of the Company as
determined pursuant to the provisions of Section 3.4 of the Note.


 




     

     


    


 


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


 


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



 





	Issue to:	 
	 	 
	 	 


 





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



 





	DTC Participant:	 
	DTC Number:	 
	Account Number:	 


 


Date:_____________________


  


	 	 



Name of Registered Holder


 


 





	By: 	 	 





Name:


Title:


 


Tax ID:_______________________


 


Facsimile:_____________________


 


Email Address:_________________


 







    	 	2	 



     


    


 


EXHIBIT II


 


TRANSFER
AGENT INSTRUCTIONS


 


Fennec
Pharmaceuticals Inc.






_________ ___, 20__


 


[Transfer Agent]


[Address]


[Address]


[Address]


 


Re:       Order
to Issue Common Shares of Fennec Pharmaceuticals Inc.


 


Ladies and Gentlemen:


 


Reference is made to (A) the Securities Purchase
Agreement, dated as of August 1, 2022, as amended, by and among Fennec Pharmaceuticals Inc., a British Columbia corporation (the “Company”),
and the investors who are parties thereto, pursuant to which the Company is issuing to the purchasers (collectively, the “Holders”)
senior secured convertible notes (the “Notes”), which are convertible into shares of the Company’s Common
Shares, no par value (the “Common Shares”); (B) the related Transfer Agent Instructions, dated as of [●],
20[22] (the “20[22] Instruction”); (C) the conversion notice attached hereto (the “Conversion
Notice”); and (D) the attached copy of a written instruction from the general counsel of the Company (or its outside legal
counsel) that (1) a registration statement covering the resale of the shares of the Common Shares, subject to this letter, has been declared
effective by the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “1933 Act”),
(2) the Holders may transfer such shares of the Common Shares under Rule 144 promulgated under the 1933 Act (“Rule 144”),
or (3) the Holders may transfer such shares of the Common Shares under Rule 144, without having to comply with the information requirements
under Rule 144(c)(1).


 


This instruction letter shall serve as our authorization
and direction to you to issue:


 


		·	to the recipient identified under “Issue to” in the applicable Conversion Notice,



		·	in book-entry form,



		·	such number of shares of the Common Shares as set forth under “Number of shares of the Common Shares
to be issued” in the Conversion Notice,



		·	out of the Transfer Agent Reserve (as defined in the 20[22] Instruction), and



		·	by crediting the designated recipient’s balance account with the Depository Trust Company, identified
in the Conversion Notice under “DTC Participant,” “DTC Number,” and “Account Number,” through its
Deposit Withdrawal at Custodian system.



  


[Signature Page Follows]


 






     

     


    

 


 




Should you have any questions concerning this matter,
please contact me at [_______].


 


 


	 	Very Truly Yours,
	 	 
	 	Fennec Pharmaceuticals Inc.
	 	 	 
	 	 	 
	 	By: 	 
	 	Name:
	 	Title:





 


 

 


 


 



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