Exhibit
10.2


 


NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON
CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.


 


Original
Issue Date: December 16, 2022


 


$1,666,666.67


 


10%
ORIGINAL ISSUE DISCOUNT SENIOR SECURED CONVERTIBLE NOTE


 


DUE
SEPTEMBER 16, 2023


 


THIS
10% ORIGINAL ISSUE DISCOUNT SENIOR SECURED NOTE is one of a series of duly authorized and validly issued 10% Original Issue Discount
Senior Secured Convertible Notes of White River Energy Corp, a Nevada corporation (the “Company”), having its principal place
of business at 609 West Dickson St. Suite 102G, Fayetteville, AR 72701, designated as its 10% Original Issue Discount Senior Secured
Convertible Note due on the Maturity Date (defined below) (this Note, the “ Note “ and, collectively with the any
other Notes of such series, the “ Notes”). The Notes shall be convertible into shares of common stock of the Company.


 


FOR
VALUE RECEIVED, the Company promises to pay to ______, or its registered assigns (the “Holder”), or shall have
paid pursuant to the terms hereunder, the principal sum of $1,666,666.67 on the date that is nine months from the Original Issuance Date
(the “ Maturity Date “) or such earlier date as this Note is required or permitted to be repaid as provided hereunder,
and to pay interest to the Holder on the aggregate unconverted and then outstanding principal amount of this Note in accordance with
the provisions hereof. This Note is subject to the following additional provisions:


 


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


 


“Alternate
Consideration” shall have the meaning set forth in Section 5(e).


 


“Bankruptcy
Event” means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w)
of Regulation S-X) thereof commences a case or other proceeding under any bankruptcy, reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the Company or any Significant
Subsidiary thereof , (b) there is commenced against the Company or any Significant Subsidiary thereof any such case or proceeding that
is not dismissed within 60 days after commencement, (c) the Company or any Significant Subsidiary thereof is adjudicated insolvent or
bankrupt or any order of relief or other order approving any such case or proceeding is entered, (d) the Company or any Significant Subsidiary
thereof suffers any appointment of any custodian or the like for it or any substantial part of its property that is not discharged or
stayed within 60 calendar days after such appointment, (e) the Company or any Significant Subsidiary thereof or makes a general assignment
for the benefit of creditors, (f) the Company or any Significant Subsidiary thereof calls a meeting of its creditors with a view to arranging
a composition, adjustment or restructuring of its debts or (g) the Company or any Significant Subsidiary thereof , by any act or failure
to act, expressly indicates its consent to, approval of or acquiescence in any of the foregoing or takes any corporate or other action
for the purpose of effecting any of the foregoing.


 




    	-1-



     


    

 


“Base
Conversion Price” shall have the meaning set forth in Section 5(b).


 


“Beneficial
Ownership Limitation” shall have the meaning set forth in Section 4(c).


 


“Business
Day” means any day except any Saturday, any 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.


 


“Buy-In”
shall have the meaning set forth in Section 4(d)(v).


 


“Change
of Control Transaction” shall have the meaning set forth in the Purchase Agreement.


 


“Closing
Bid Price” means on any particular date (a) the last reported closing bid price per share of Common Stock on such date on the
Trading Market (as reported by Bloomberg L.P. at 4:15 p.m. (New York City time)), or (b) if there is no such price on such date, then
the closing bid price on the Trading Market on the date nearest preceding such date (as reported by Bloomberg L.P. at 4:15 p.m. (New
York City time)), or (c) if the Common Stock is not then listed or quoted on a Trading Market and if prices for the Common Stock are
then reported in the “pink sheets” published by the OTC Pink Markets (or a similar organization or agency succeeding to its
functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) if the shares of Common Stock
are not then publicly traded the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.


 


“Conversion”
shall have the meaning ascribed to such term in Section 4.


 


“Conversion
Date” shall have the meaning set forth in Section 4(a).


 


“Conversion
Price” shall have the meaning set forth in Section 4(b).


 


“Conversion
Schedule” means the Conversion Schedule in the form of Schedule 1 attached hereto.


 


“Conversion
Shares” means, collectively, the shares of common stock, of the Company issuable upon conversion of this Note in accordance
with the terms hereof.


 


“Note
Register” shall have the meaning set forth in Section 2(c).


 


“Dilutive
Issuance” shall have the meaning set forth in Section 5(b).


 


“Dilutive
Issuance Notice” shall have the meaning set forth in Section 5(b).


 


“Effectiveness
Period” shall have the meaning set forth in the Registration Rights Agreement.


 


“Event
of Default” shall have the meaning set forth in Section 8(a).


 




    	-2-



     


    

 


“Exempt
Issuance” means the issuance of (a) shares of Common Stock, restricted stock units, or options to purchase shares of Common
Stock to employees, officers or directors or consultants of the Company pursuant to any stock or option plan duly adopted by the Board
of Directors of the Company or a majority of the members of a committee of non-employee directors established for such purpose, (b) shares
of Common Stock issuable upon exercise, conversion or pursuant to the terms of the Securities, or convertible securities, options or
warrants issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of
this Agreement to increase the number of such securities or to decrease the exercise, exchange or conversion price of any such securities,
(c) shares of Common Stock issued or issuable upon any anti-dilution adjustment (to the extent such provision has not been amended since
the date hereof) to Common Stock and Common Stock Equivalents held by current security holders as of the date of this Note, (d) securities
issued to any underwriter, placement agent or other registered broker-dealer as reasonable commissions or fees in connection with any
financing transactions, (e) securities issued pursuant to any purchase money equipment loan, capital leasing arrangement or debt financing
from a commercial bank or similar financial institution, and (f) securities issued pursuant to acquisitions or strategic transaction,
provided that any such issuance shall only be to a person which is, itself or through its subsidiaries, an operating company in a business
synergistic with the business of the Company and in which the Company receive benefits in addition to the investment of funds, but shall
not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose
primary business is investing in securities.


 


“Fundamental
Transaction” shall have the meaning set forth in Section 5(e).


 


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


 


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


 


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


 


“Majority
Purchasers” shall mean holders of 50% of the then outstanding principal amount of the Notes, so long as such 50% includes _______ as lead investor.


 


“Mandatory
Default Amount” means the sum of (a) 125% of the then outstanding principal amount of the Note, (b) accrued but unpaid interest
through maturity and (c) all liquidated damages and other amounts due in respect of the Note.


 


“Monthly
Conversion Period” shall have the meaning set forth in Section 6(b) hereof.


 


“Monthly
Conversion Price” shall have the meaning set forth in Section 6(b) hereof.


 


“Monthly
Redemption” means the redemption of this Note pursuant to Section 6(b) hereof.


 


“Monthly
Redemption Amount” means, as to a Monthly Redemption, one-fourth of the original principal amount at 120% of such principal
amount, plus accrued but unpaid interest, liquidated damages and any other amounts then owing to the Holder in respect of this Note.


 


“Monthly
Redemption Date” means the 16th of each month, commencing immediately upon April 16, 2023 and terminating upon the full redemption
of this Note.


 


“Monthly
Redemption Notice” shall have the meaning set forth in Section 6(b) hereof.


 


“New
York Courts” shall have the meaning set forth in Section 9(d).


 


“Notice
of Conversion” shall have the meaning set forth in Section 4(a).


 


“Optional
Redemption” shall have the meaning set forth in Section 6(a).


 




    	-3-



     


    

 


“Optional
Redemption Amount” means at 120% of the principal amount thereof plus any unpaid accrued interest to the date of repayment,
plus all other liquidated and other amounts due in respect of the Note.


 


“Optional
Redemption Date” shall have the meaning set forth in Section 6(a).


 


“Optional
Redemption Notice” shall have the meaning set forth in Section 6(a).


 


“Optional
Redemption Notice Date” shall have the meaning set forth in Section 6(a).


 


“Optional
Redemption Period” shall have the meaning set forth in Section 6(a).


 


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


 


“Permitted
Indebtedness” means (a) the Indebtedness evidenced by the Notes (excluding any Notes issued pursuant to most favored nations
or similar provisions), (b) indebtedness existing as of the date hereof, (c) lease obligations and purchase money indebtedness of up
to $100,000, in the aggregate, incurred in connection with the acquisition of capital assets and lease obligations with respect to newly
acquired or leased assets, (d) Indebtedness owed to any Person providing property, casualty, liability, or other insurance to the Debtor,
so long as the amount of such Indebtedness is not in excess of the amount of the unpaid cost of, and shall be incurred only to defer
the cost of, such insurance for the period in which such Indebtedness is incurred and such Indebtedness is outstanding only during such
period, (e) intercompany loan so long as the party receiving the loan is a majority-owned or wholly-owned subsidiary of the Company or
a Subsidiary and a guarantor of the Notes, (f) Indebtedness incurred in respect of credit cards, credit card processing services, debit
cards, stored value cards, purchase cards (including so-called “procurement cards” or “P-cards”) or other similar
cash management services, in each case, incurred in the ordinary course of business, (g) investments in negotiable instruments deposited
or to be deposited for collection in the ordinary course of business, (h) advances made in connection with purchases of goods or services
in the ordinary course of business; and (i) unsecured indebtedness that is expressly subordinate to the Notes pursuant to a written subordination
agreement with the Purchasers that is acceptable to each Purchaser in its sole and absolute discretion.


 


“Permitted
Lien” means the individual and collective reference to the following: (a) Liens for taxes, assessments and other governmental
charges or levies not yet due or Liens for taxes, assessments and other governmental charges or levies being contested in good faith
and by appropriate proceedings for which adequate reserves (in the good faith judgment of the management of the Company) have been established
in accordance with GAAP; (b) Liens imposed by law which were incurred in the ordinary course of the Company’s business, such as
carriers’, warehousemen’s and mechanics’ Liens, statutory landlords’ Liens, and other similar Liens arising in
the ordinary course of the Company’s business, and which (x) do not individually or in the aggregate materially detract from the
value of such property or assets or materially impair the use thereof in the operation of the business of the Company or (y) are being
contested in good faith by appropriate proceedings, which proceedings have the effect of preventing for the foreseeable future the forfeiture
or sale of the property or asset subject to such Lien; (c) deposits and pledges of cash securing (i) obligations incurred in respect
of workers’ compensation, unemployment insurance or other forms of governmental insurance or benefits, (ii) the performance of
bids, tenders, leases, contracts (other than for the payment of money) and statutory obligations or (iii) obligations on surety or appeal
bonds, but only to the extent such deposits or pledges are made or otherwise arise in the ordinary course of business and secure obligations
not past due; (d) easements, zoning restrictions and similar encumbrances on real property and minor irregularities in the title thereto
that do not (i) secure obligations for the payment of money or (ii) materially impair the value of such property or its use by the Company
or any of its Subsidiaries in the normal conduct of such Person’s business; (e) Liens securing the title and interest of a lessor
or sublessor in and to personal property leased or subleased (other than through a capitalized lease), in each case extending only to
such personal property; (f) non-exclusive licenses of intellectual property rights in the ordinary course of business; (g) judgment liens
(other than for the payment of taxes, assessments or other governmental charges) securing judgments and other proceedings not constituting
an Event of Default under this Note; (h) rights of set-off or bankers’ liens upon deposits of cash in favor of banks or other depository
institutions, solely to the extent incurred in connection with the maintenance of such deposit accounts in the ordinary course of business;
and (i) Liens incurred in connection with Permitted Indebtedness incurred under clauses (a) and (b) thereunder.


 




    	-4-



     


    

 


“Purchase
Agreement” means the Securities Purchase Agreement, dated as of December 16, 2022 between the Company, and the original Holder,
as amended, modified or supplemented from time to time in accordance with its terms.


 


“Qualified
Offering” means an offering of equity or debt securities for gross proceeds to the Company of not less than $5.0 million.


 


“Registration
Rights Agreement” means the Registration Rights Agreement, dated as of the date of the Purchase Agreement, between the Company,
and the original Holder, as amended, modified or supplemented from time to time in accordance with its terms.


 


“Registration
Statement” means a registration statement that registers the resale of all Conversion Shares and the Shares, names the Holder
as a “selling stockholder” therein, and meets the requirements of the Registration Rights Agreement.


 


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


 


“Share
Delivery Date” shall have the meaning set forth in Section 4(d)(ii).


 


“Shares”
means the shares of common stock, par value 0.0001 per share, of the Company.


 


“Subsidiary”
shall have the meaning set forth in the Purchase Agreement.


 


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


 


Section
2. Interest.


 


a)
Payment of Interest in Cash. The Company shall pay interest to the Holder on the aggregate unconverted and then outstanding principal
amount of this Note at the rate of 12% per annum, payable monthly, on the 16th calendar day of each month, beginning on January 16, 2023
and on the Maturity Date (each such date, an “Interest Payment Date”) (if any Interest Payment Date is not a Business
Day, then the applicable payment shall be due on the next succeeding Business Day), in cash.


 


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


 




    	-5-



     


    

 


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


 


Section
3. Registration of Transfers and Exchanges.


 


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


 


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


 


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


 


Section
4. Conversion.


 


a)
Voluntary Conversion. At any time after the Original Issue Date until this Note is no longer outstanding, this Note shall be convertible,
in whole or in part, into shares of common stock of the Company (the “Common Stock”) at the option of the Holder, at any
time and from time to time (subject to the conversion limitations set forth in Section 4(c) hereof). The Holder shall effect conversions
by delivering to the Company a Notice of Conversion, the form of which is attached hereto as Annex A (each, a “Notice
of Conversion”), specifying therein the principal amount of this Note to be converted and the date on which such conversion
shall be effected (such date, the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion,
the Conversion Date shall be the date that such Notice of Conversion is deemed delivered hereunder. To effect conversions hereunder,
the Holder shall not be required to physically surrender this Note to the Company unless the entire principal amount of this Note, plus
all accrued and unpaid interest thereon, has been so converted. Conversions hereunder shall have the effect of lowering the outstanding
principal amount of this Note in an amount equal to the applicable conversion. The Holder and the Company shall maintain records showing
the principal amount(s) converted and the date of such conversion(s). The Company may deliver an objection to any Notice of Conversion
within two Business Days of delivery of such Notice of Conversion. In the event of any dispute or discrepancy, the records of the Holder
shall be controlling and determinative in the absence of manifest error. The Holder, and any assignee by acceptance of this Note,
acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid
and unconverted principal amount of this Note may be less than the amount stated on the face hereof.


 


b)
Conversion Price. The Notes shall be convertible at the option of the Holder into shares of Common Stock of the Company at the
lesser of (i) $1.00 per share and (ii) the average of the five-closing prices of the Common Stock immediately prior to the date of conversion
((as adjusted hereunder, the “Conversion Price”).


 




    	-6-



     


    

 


c)
Conversion Limitations. Notwithstanding anything herein to the contrary, the Company shall not effect any conversion of this Note,
and a Holder shall not have the right to convert any portion of this Note, to the extent that after giving effect to the conversion set
forth on the applicable Notice of Conversion, the Holder (together with the Holder’s Affiliates, and any other person or entity
acting as a group together with the Holder or any of the Holder’s Affiliates) would beneficially own in excess of the Beneficial
Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned
by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon conversion of this Note with respect
to which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable upon (A) conversion
of the remaining, unconverted principal amount of this Note beneficially owned by the Holder or any of its Affiliates and (B) exercise
or conversion of the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion
or exercise analogous to the limitation contained herein (including, without limitation, any other Notes) beneficially owned by the Holder
or any of its Affiliates. Except as set forth in the preceding sentence, for purposes of this Section 4(c), beneficial ownership shall
be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. To the extent
that the limitation contained in this Section 4(c) applies, the determination of whether this Note is convertible (in relation to other
securities owned by the Holder together with any Affiliates) and of which principal amount of this Note is convertible shall be in the
sole discretion of the Holder, and the submission of a Notice of Conversion shall be deemed to be the Holder’s determination of
whether this Note may be converted (in relation to other securities owned by the Holder together with any Affiliates) and which principal
amount of this Note is convertible, in each case subject to the Beneficial Ownership Limitation. To ensure compliance with this restriction,
the Holder will be deemed to represent to the Company each time it delivers a Notice of Conversion that such Notice of Conversion has
not violated the restrictions set forth in this paragraph and the Company shall have no obligation to verify or confirm the accuracy
of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 4(c), in determining
the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as stated in
the most recent of the following: (A) the Company’s most recent periodic or annual report, as the case may be; (B) a more recent
public announcement by the Company; or (C) a more recent notice by the Company or the Company’s transfer agent setting forth the
number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company shall within two Trading Days
confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including
this Note, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported.
The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding immediately
after giving effect to the issuance of shares of Common Stock issuable upon conversion of this Note held by the Holder. The Holder, upon
not less than 61 days’ prior notice to the Company , may increase or decrease the Beneficial Ownership Limitation provisions of
this Section 4(c), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common
Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon conversion of this Note held by the
Holder and the Beneficial Ownership Limitation provisions of this Section 4(c) shall continue to apply. Any such increase or decrease
will not be effective until the 61 st day after such notice is delivered to the Company. The Beneficial Ownership Limitation
provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this
Section 4(c) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership
Limitation contained herein or to make changes or supplements necessary or desirable to properly give effect to such limitation. The
limitations contained in this paragraph shall apply to a successor holder of this Note.


 


d)
Mechanics of Conversion.


 


i.
Conversion Shares Issuable Upon Conversion of Principal Amount. Subject to Section 4(d)(vii), the number of Conversion Shares
issuable upon a conversion hereunder shall be determined by the quotient obtained by dividing (x) the outstanding principal amount of
this Note to be converted by (y) the Conversion Price.


 




    	-7-



     


    

 


ii.
Delivery of Certificate Upon Conversion. Not later than two Trading Days after each Conversion Date (the “Share Delivery
Date”), the Company shall deliver, or cause to be delivered, to the Holder (A) a certificate or certificates representing the
Conversion Shares which, on or after the earlier of (i) the six month anniversary of the Original Issue Date or (ii) the Effective Date,
shall be free of restrictive legends and trading restrictions (other than those which may then be required by the Purchase Agreement)
representing the number of Conversion Shares being acquired upon the conversion of this Note and (B) a bank check in the amount of accrued
and unpaid interest. On or after the earlier of (i) the six-month anniversary of the Original Issue Date or (ii) the Effectiveness Date
(as defined in the Registration Rights Agreement), the Company shall use its commercially reasonable efforts to deliver any certificate
or certificates required to be delivered by the Company under this Section 4(d) free of restrictive legends and trading restrictions
electronically through the Depository Trust Company or another established clearing corporation performing similar functions.


 


iii.
Failure to Deliver Certificates. If in the case of any Notice of Conversion such certificate or certificates are not delivered
to or as directed by the applicable Holder by the second Trading Day after the Conversion Date, the Holder shall be entitled to elect
by written notice to the Company at any time on or before its receipt of such certificate or certificates, to rescind such Conversion,
in which event the Company shall promptly return to the Holder any original Note delivered to the Company and the Holder shall promptly
return to the Common Stock certificates representing the principal amount of this Note unsuccessfully tendered for conversion to the
Company.


 


iv.
Obligation Absolute; Partial Liquidated Damages. If the Company fails for any reason to deliver to the Holder such certificate
or certificates pursuant to Section 4(f)(ii) by the second Trading Day after the Conversion Date, for each $1,000 of principal amount
being converted, the Company shall pay to such Holder, in cash, as liquidated damages and not as a penalty, of $10 for each Trading Day
after such second Trading Day (increasing to $20 per Trading Day after the fifth Trading Day) until such certificates are delivered.
In addition, if the Company fails to deliver instructions to the Transfer Agent by the day required above, the Company shall be required
to pay an additional amount in cash, as liquidated damages and not as a penalty, of $10 for each date until such notice is given to the
Transfer Agent as required. The Company’s obligations to issue and deliver the Conversion Shares upon conversion of this Note in
accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the
same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce
the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other
Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person, and irrespective
of any other circumstance which might otherwise limit such obligation of the Company to the Holder in connection with the issuance of
such Conversion Shares; provided, however, that such delivery shall not operate as a waiver by the Company of any such
action the Company may have against the Holder. In the event a Holder of this Note shall elect to convert any or all of the outstanding
principal amount hereof, the Company may not refuse conversion based on any claim that the Holder or any one associated or affiliated
with the Holder of has been engaged in any violation of law, agreement or for any other reason, unless, an injunction from a court, on
notice, restraining and or enjoining conversion of all or part of this Note shall have been sought and obtained and the Company posts
a surety bond for the benefit of the Holder in the amount of 150% of the principal amount of this Note outstanding, which is subject
to the injunction, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and the proceeds of
which shall be payable to such Holder to the extent it obtains judgment. In the absence of an injunction precluding the same, the Company
shall issue Conversion Shares or, if applicable, cash, upon a properly noticed conversion. Nothing herein shall limit a Holder’s
right to pursue actual damages or declare an Event of Default pursuant to Section 8 herein for the Company’s failure to deliver
Conversion Shares within the period specified herein and such Holder shall have the right to pursue all remedies available to it at law
or in equity including, without limitation, a decree of specific performance and/or injunctive relief. The exercise of any such rights
shall not prohibit the Holders from seeking to enforce damages pursuant to any other Section hereof or under applicable law. In the absence
of such injunction, the Company shall issue Conversion Shares or, if applicable, cash, upon a properly noticed conversion. If the Company
fails for any reason to deliver to the Holder such certificate or certificates pursuant to Section 4(d)(ii) by the second Trading Day
after the Conversion Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000
of principal amount being converted, $10 per Trading Day (increasing to $20 per Trading Day on the fifth (5th) Trading Day
after such liquidated damages begin to accrue) for each Trading Day after such third (3rd) Trading Day until such certificates
are delivered. Nothing herein shall limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to
Section 8 hereof for the Company’s failure to deliver Conversion Shares within the period specified herein and the Holder shall
have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant
to any other Section hereof or under applicable law


 




    	-8-



     


    

 


v.
Compensation for Buy-In on Failure to Timely Deliver Certificates Upon Conversion. In addition to any other rights available to
the Holder, if the Company fails for any reason to deliver to the Holder such certificate or certificates by the Share Delivery Date
pursuant to Section 4(d)(ii), and if after such Share Delivery Date the Holder is required by its brokerage firm to purchase (in an open
market transaction or otherwise), or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction
of a sale by the Holder of the Conversion Shares which the Holder was entitled to receive upon the conversion relating to such Share
Delivery Date (a “Buy-In”), then the Company shall (A) pay in cash to the Holder (in addition to any other remedies
available to or elected by the Holder) the amount by which (x) the Holder’s total purchase price (including any brokerage commissions)
for the Common Stock so purchased exceeds (y) the product of (1) the aggregate number of shares of Common Stock that the Holder was entitled
to receive from the conversion at issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase
obligation was executed (including any brokerage commissions) and (B) at the option of the Holder, either reissue (if surrendered) this
Note in a principal amount equal to the principal amount of the attempted conversion or deliver to the Holder the number of shares of
Common Stock that would have been issued if the Company had timely complied with its delivery requirements under Section 4(d)(ii). For
example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted
conversion of this Note with respect to which the actual sale price of the Conversion Shares (including any brokerage commissions) giving
rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Company shall be
required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in
respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s
right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific
performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of
Common Stock upon conversion of this Note as required pursuant to the terms hereof.


 


vi.
Reservation of Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available out
of its authorized and unissued shares of Common Stock for the sole purpose of issuance upon conversion of this Note, as herein provided,
free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holder (and the other holders of
the Notes), not less than three times the sum of (i) the aggregate number of shares of the Common Stock as shall (subject to the terms
and conditions set forth in the Purchase Agreement) issuable (taking into account the adjustments and restrictions of Section 5) upon
the conversion of the outstanding principal amount of this Note and payment of interest hereunder and (ii) the number of Shares issuable
to Holder pursuant to the Transaction Documents. The Company covenants that all shares of Common Stock that shall be so issuable shall,
upon issue, be duly authorized, validly issued, fully paid and nonassessable and, if the Registration Statement is then effective under
the Securities Act, shall be registered for public sale in accordance with such Registration Statement.


 


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


 




    	-9-



     


    

 


viii.
Transfer Taxes. The issuance of certificates for shares of the Common Stock on conversion of this Note shall be made without charge
to the Holder hereof for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificates,
provided that, the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance
and delivery of any such certificate upon conversion in a name other than that of the Holder of this Note so converted and the Company
shall not be required to issue or deliver such certificates unless or until the person or persons requesting the issuance thereof shall
have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.


 


Section
5. Certain Adjustments.


 


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


 


b)
Subsequent Equity Sales. If, at any time while this Note is outstanding, the Company sells or grants any option to purchase or
sells or grants any right to reprice, or otherwise disposes of or issues (or announces any sale, grant or any option to purchase or other
disposition), any common stock or common stock equivalents entitling any Person to acquire shares of common stock at an effective price
per share that is lower than the then Conversion Price (such lower price, the “Base Conversion Price” and such issuances,
collectively, a “Dilutive Issuance”) (if the holder of the common stock or common stock equivalents so issued shall
at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or
otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled to receive
shares of common stock at an effective price per share that is lower than the Conversion Price, such issuance shall be deemed to have
occurred for less than the Conversion Price on such date of the Dilutive Issuance), then the Conversion Price shall be reduced to equal
the Base Conversion Price. Such adjustment shall be made whenever such common stock or common stock equivalents are issued. Notwithstanding
the foregoing, no adjustment will be made under this Section 5(b) in respect of an Exempt Issuance. If the Company enters into a Variable
Rate Transaction, despite the prohibition set forth in the Purchase Agreement, the Company shall be deemed to have issued common stock
or common stock equivalents at the lowest possible conversion price at which such securities may be converted or exercised. The Company
shall notify the Holder in writing, no later than 1 Business Day following the issuance of any Common Stock or Common Stock Equivalents
subject to this Section 5(b), indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion
price and other pricing terms (such notice, the “Dilutive Issuance Notice”). For purposes of clarification, whether
or not the Company provides a Dilutive Issuance Notice pursuant to this Section 5(b), upon the occurrence of any Dilutive Issuance, the
Holder is entitled to receive a number of Conversion Shares based upon the Base Conversion Price on or after the date of such Dilutive
Issuance, regardless of whether the Holder accurately refers to the Base Conversion Price in the Notice of Conversion.


 




    	-10-



     


    

 


c)
Subsequent Rights Offerings. If the Company, at any time while the Note is outstanding, shall issue rights, options or warrants
to all holders of Common Stock (and not to Holders) entitling them to subscribe for or purchase shares of Common Stock at a price per
share that is lower than the then Conversion Price , then the Conversion Price shall be multiplied by a fraction of which the denominator
shall be the number of shares of the Common Stock outstanding on the date of issuance of such rights or warrants plus the number of additional
shares of Common Stock offered for subscription or purchase, and of which the numerator shall be the number of shares of the Common Stock
outstanding on the date of issuance of such rights or warrants plus the number of shares which the aggregate offering price of the total
number of shares so offered (assuming delivery to the Company in full of all consideration payable upon exercise of such rights, options
or warrants) would purchase at such price. Such adjustment shall be made whenever such rights or warrants are issued, and shall become
effective immediately after the record date for the determination of stockholders entitled to receive such rights, options or warrants.


 


d)
Pro Rata Distributions. If the Company, at any time while this Note is outstanding, distributes to all holders of Common Stock
(and not to the Holders) evidences of its indebtedness or assets (including cash and cash dividends) or rights or warrants to subscribe
for or purchase any security (other than the Common Stock, which shall be subject to Section 5(b)), then in each such case the Conversion
Price shall be adjusted by multiplying such Conversion Price in effect immediately prior to the record date fixed for determination of
stockholders entitled to receive such distribution by a fraction of which the denominator shall be the lower of (i) the closing price
of the Common Stock or (ii) the VWAP determined as of the record date mentioned above, and of which the numerator shall be such then
price of the Common Stock or the VWAP on such record date less the then fair market value at such record date of the portion of such
assets or evidence of indebtedness so distributed applicable to one outstanding share of the Common Stock as determined by the Board
of Directors of the Company in good faith. In either case the adjustments shall be described in a statement delivered to the Holder describing
the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share of Common Stock.
Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the record date mentioned
above.


 


e)
Fundamental Transaction. If, at any time while this Note is outstanding, (i) the Company effects any merger or consolidation of
the Company with or into another Person, (ii) the Company effects any sale of all or substantially all of its assets in one transaction
or a series of related transactions, (iii) any tender offer or exchange offer (whether by the Company or another Person) is completed
pursuant to which holders of Common Stock are permitted to tender or exchange their shares for other securities, cash or property, or
(iv) the Company effects any reclassification of Common Stock or any compulsory share exchange pursuant to which the Common Stock is
effectively converted into or exchanged for other securities, cash or property (in any such case, a “Fundamental Transaction”),
then, upon any subsequent conversion of this Note, the Holder shall have the right to receive, for each Conversion Share that would have
been issuable upon such conversion immediately prior to the occurrence of such Fundamental Transaction, the same kind and amount of securities,
cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately
prior to such Fundamental Transaction, the holder of one share of Common Stock (the “Alternate Consideration”). For
purposes of any such conversion, the determination of the Conversion Price shall be appropriately adjusted to apply to such Alternate
Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction,
and the Company shall apportion the Conversion Price among the Alternate Consideration in a reasonable manner reflecting the relative
value of any different components of the Alternate Consideration. If holders of one share of Common Stock are given any choice as to
the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the
Alternate Consideration it receives upon any conversion of this Note following such Fundamental Transaction. To the extent necessary
to effectuate the foregoing provisions, any successor to the Company or surviving entity in such Fundamental Transaction shall issue
to the Holder a new Note consistent with the foregoing provisions and evidencing the Holder’s right to convert such Note into Alternate
Consideration. The terms of any agreement pursuant to which a Fundamental Transaction is effected shall include terms requiring any such
successor or surviving entity to comply with the provisions of this Section 5(e) and insuring that this Note (or any such replacement
security) will be similarly adjusted upon any subsequent transaction analogous to a Fundamental Transaction.


 




    	-11-



     


    

 


f)
Calculations. All calculations under this Section 5 shall be made to the nearest cent or the nearest 1/100th of a share, as the
case may be. For purposes of this Section 5, the number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding any treasury shares of the Company) issued and outstanding.


 


g)
Notice to the Holder.


 


i.
Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 5, the Company
shall promptly deliver to each Holder a notice setting forth the Conversion Price after such adjustment and setting forth a brief statement
of the facts requiring such adjustment.


 


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


 


Section
6. Redemption; Automatic Conversion.


 


a)
Optional Redemption at Election of Company. Subject to the provisions of this Section 6(a), at any time after Original Issue Date
and prior to the Maturity Date, the Company may, deliver a written notice to the Holder (an “Optional Redemption Notice”
and the date such notice is deemed delivered hereunder, the “Optional Redemption Notice Date”) of its irrevocable
election, unless waived by the Holder, to redeem all of the then outstanding principal amount of this Note for cash in an amount equal
to the Optional Redemption Amount on the 20th Trading Day following the Optional Redemption Notice Date (such date, the “Optional
Redemption Date”, such 20 Trading Day period, the “Optional Redemption Period” and such redemption, the
“Optional Redemption”). The Optional Redemption Amount is payable in full on the Optional Redemption Date. The Company
covenants and agrees that it will honor all Notices of Conversion tendered from the time of delivery of the Optional Redemption Notice
through the date all amounts owing thereon are due and paid in full. The Company’s determination to pay an Optional Redemption
in cash shall be applied ratably to all of the holders of the then outstanding Notes based on their (or their predecessor’s) initial
purchases of Notes pursuant to the Purchase Agreement. In the event of any such attempt to repay the Notes, the Holder shall have the
right to convert the Notes prior to the date of any such prepayment in accordance with the conversion mechanics set forth herein.


 




    	-12-



     


    

 


b)
Monthly Redemption. On each Monthly Redemption Date, the Company shall redeem the Monthly Redemption Amount (the “Monthly
Redemption”) , and upon the payment of each such Monthly Redemption, the accrued interest, principal and other amounts then
outstanding under this Note shall be reduced at 100% (as compared to the 120%) of the principal amount so repaid. The Monthly Redemption
Amount payable on each Monthly Redemption Date shall be paid in cash Holder may convert, pursuant to Section 4(a), any principal amount
of this Note subject to a Monthly Redemption at any time prior to the date that the Monthly Redemption Amount, plus accrued but unpaid
interest, liquidated damages and any other amounts then owing to the Holder are due and paid in full.


 


Any
principal amount of this Note converted during the applicable Monthly Conversion Period in excess of the Monthly Redemption Amount shall
be applied against the last principal amount of this Note scheduled to be redeemed hereunder, in reverse time order from the Maturity
Date. The Company covenants and agrees that it will honor all Notices of Conversion tendered up until such amounts are paid in full.
The Company’s determination to pay a Monthly Redemption shall be applied ratably to all of the holders of the then outstanding
Notes based on their (or their predecessor’s) initial purchases of Notes pursuant to the Purchase Agreement.


 


c)
Redemption Procedure. The payment of cash pursuant to an Optional Redemption or a Monthly Redemption shall be payable on the Optional
Redemption Date and Monthly Redemption Date, as applicable. If any portion of the payment pursuant to an Optional Redemption or Monthly
Redemption shall not be paid by the Company by the applicable due date, and Event of Default shall be deemed to have occurred under the
Notes. Notwithstanding anything to the contrary in this Section 6, the Company’s determination to redeem in cash under Section
6(a) or its obligation to redeem under Section 6(b) shall be applied ratably among the Holders of Notes. The Holder may elect to convert
the outstanding principal amount of the Note pursuant to Section 4 prior to actual payment in cash for any redemption under this Section
6 by the delivery of a Notice of Conversion to the Company.


 


d)
Fractional Shares. No fractional shares are to be issued upon the conversion of this Note, but rather the number of shares of
Common Stock to be issued shall be rounded up to the nearest whole number. To the extent that rounding up to the nearest whole number
would result in a violation of Section 4(d)(vi), the Company shall pay the applicable converting Holder an amount in cash equal to the
fractional share amount multiplied by the Closing Bid Price for the Common Stock on the such date of conversion.


 


(e)
Mandatory Prepayment. The Company shall be required to offer to prepay in cash the aggregate principal amount of the Notes at
120% of the principal amount thereof plus any unpaid accrued interest to the date of repayment, on the sale of assets of the Company
or its Subsidiaries or upon a Change of Control, or on a Qualified Offering and at Maturity. In such an event, the Investor(s) shall
have the right to convert the Notes prior to the date of any such prepayment in accordance with any of the conversion mechanics as set
forth in the Notes. Such payment shall be made on the date of each of the events specified above and in each case the Company shall if
practical have provided 20 days’ notice to Holders. In such an event, the Holders(s) shall have the right to convert the Notes
prior to the date of any such prepayment in accordance with any of the conversion mechanics as set forth herein.


 


Section
7. Negative Covenants. As long as any portion of this Note remains outstanding, unless the Majority Purchasers shall have
otherwise given prior written consent not to be unreasonably withheld, delayed or denied, the Company shall not, and shall not permit
any of its Subsidiaries (whether or not a Subsidiary on the Original Issue Date) to, directly or indirectly:


 


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


 




    	-13-



     


    

 


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


 


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


 


d)
repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its Common Stock
or Common Stock Equivalents of the Company or its Subsidiaries other than as to (i) the Conversion Shares as permitted or required under
the Transaction Documents and (ii) repurchases of Common Stock or Common Stock Equivalents of Company departing officers and directors
of the Company, provided that such repurchases shall not exceed an aggregate of $100,000 for all officers and directors during the term
of this Note;


 


e)
repay, repurchase or offer to repay, repurchase or otherwise acquire, or make any principal, interest or amortization payment on any
Indebtedness, other than with respect to Permitted Indebtedness or the Note;


 


f)
pay cash dividends or distributions on any equity securities of the Company or its Subsidiaries;


 


g)
enter into any transaction with any Affiliate or family member of an Affiliate of the Company which would be required to be disclosed
in any public filing with the Commission(other than pursuant to agreements and transactions that are disclosed or filed in SEC Reports
or registration statements as of the Original Issue Date), unless such transaction is expressly approved by a majority of the disinterested
directors of the Company (even if less than a quorum otherwise required for board approval) or the aggregate amount involved is less
than $50,000; or


 


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


 


Section
8. Events of Default.


 


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


 


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


 


ii.
the Company, any of its Subsidiaries shall fail to observe or perform any other covenant or agreement contained in the Notes (other than
a breach by the Company of its obligations to deliver shares of Common Stock to the Holder upon conversion, which breach is addressed
in clause (xi) below) which failure is not cured, if possible to cure, within the earlier to occur of (A) 10 Trading Days after notice
of such failure sent by the Holder or by any other Holder to the Company and (B) 20 Trading Days after the Company has become or should
have become aware of such failure;


 


iii.
a default or event of default (subject to any grace or cure period provided in the applicable agreement, document or instrument) shall
occur and continue under (A) any of the Transaction Documents, or (B) any other material agreement, lease, document or instrument to
which the Company or any Subsidiary is obligated (and not covered by clause (vi) below);


 




    	-14-



     


    

 


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


 


v.
the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to a Bankruptcy
Event;


 


vi.
the Company or any Subsidiary shall default on any of its obligations under any mortgage, credit agreement or other facility, indenture
agreement, factoring agreement or other instrument under which there may be issued, or by which there may be secured or evidenced, any
indebtedness for borrowed money or money due under any long term leasing or factoring arrangement that involves an obligation greater
than $100,000, whether such indebtedness now exists or shall hereafter be created;


 


vii.
the Common Stock shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume listing
or quotation for trading thereon within five Trading Days;


 


viii.
Reserved.


 


ix.
the Company does not meet the current public information requirements under Rule 144 in respect of the Registrable Securities (as defined
under the Registration Rights Agreement);


 


x.
if, during the Effectiveness Period (as defined in the Registration Rights Agreement), either (a) the effectiveness of the Registration
Statement lapses for any reason or (b) the Holder shall not be permitted to resell Registrable Securities (as defined in the Registration
Rights Agreement) under the Registration Statement for a period of more than 20 consecutive Trading Days or 30 non-consecutive Trading
Days during any 12 month period; provided, however, that if the Company is negotiating a merger, consolidation, acquisition
or sale of all or substantially all of its assets or a similar transaction and, in the written opinion of counsel to the Company, the
Registration Statement would be required to be amended to include information concerning such pending transaction(s) or the parties thereto
which information is not available or may not be publicly disclosed at the time, the Company shall be permitted an additional 10 consecutive
Trading Days during any 12 month period pursuant to this Section 8(a)(x);


 


xi.
the Company shall fail for any reason to deliver certificates to a Holder prior to the tenth Trading Day after a Conversion Date pursuant
to Section 4(d) the Company shall provide at any time notice to the Holder, including by way of public announcement, of the Company’s
intention to not honor requests for conversions of any Notes in accordance with the terms hereof; or


 


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


 


b)
Remedies Upon Event of Default. If any Event of Default occurs, the outstanding principal amount of this Note, plus accrued but
unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the
Holder’s election, immediately due and payable in cash at the Mandatory Default Amount. Commencing five days after the occurrence
of any Event of Default that results in the eventual acceleration of this Note, the interest rate on this Note shall accrue at an interest
rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. At Holder’s option, it shall be entitled
to be paid all such amounts due including late fees, if any, in cash or from time to time in Common Stock with the conversion price of
the Common Stock equal to a 30% discount to the lowest closing price of the common stock for the 10 prior Trading Days. Upon the payment
in full of the Mandatory Default Amount, the Holder shall promptly surrender this Note to or as directed by the Company. In connection
with such acceleration described herein, the Holder need not provide, and the Company hereby waives, any presentment, demand, protest
or other notice of any kind, and the Holder may immediately and without expiration of any grace period enforce any and all of its rights
and remedies hereunder and all other remedies available to it under applicable law. Such acceleration may be rescinded and annulled by
Holder at any time prior to payment hereunder and the Holder shall have all rights as a holder of the Note until such time, if any, as
the Holder receives full payment pursuant to this Section 8(b). No such rescission or annulment shall affect any subsequent Event of
Default or impair any right consequent thereon.


 




    	-15-



     


    

 


Section
9. Miscellaneous.


 


a)
Notices. Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without
limitation, any Notice of Conversion, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized
overnight courier service, addressed to the Company at the address set forth above, or such other facsimile or electronic mail number
or address as the Company may specify for such purpose by notice to the Holder delivered in accordance with this Section 9(a). Any and
all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally,
by facsimile or electronic mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile
number or address of the Holder appearing on the books of the Company, or if no such facsimile number or address appears, at the principal
place of business of the Holder. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the
earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile or electronic mail at the facsimile
number or email address, as applicable, specified on the signature page prior to 5:30 p.m. (New York City time), (ii) the date immediately
following the date of transmission, if such notice or communication is delivered via facsimile or electronic mail at the facsimile number
or email address, as applicable, specified on the signature page between 5:30 p.m. (New York City time) and 11:59 p.m. (New York City
time) on any date, (iii) the second Business Day following the date of mailing, if sent by nationally recognized overnight courier service
or (iv) upon actual receipt by the party to whom such notice is required to be given.


 


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


 


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


 


d)
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed
by and construed and enforced in accordance with the internal laws of the State of Nevada, without regard to the principles of conflict
of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense of the transactions
contemplated by any of the Transaction Documents (whether brought against a party hereto or its respective Affiliates, directors, officers,
shareholders, employees or agents) shall be commenced in the state and federal courts sitting in the City of New York, Borough of Manhattan
(the “New York Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York
Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed
herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not
to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such New York Courts,
or such New York Courts are improper or inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service
of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees
that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any other manner permitted by applicable law. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of
or relating to this Note or the transactions contemplated hereby. If the Holder shall commence an action or proceeding to enforce any
provisions of this Note, then it shall be reimbursed by the Company for its attorney’s fees and other costs and expenses incurred
in the investigation, preparation and prosecution of such action or proceeding.


 




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e)
Waiver; Amendment. Any waiver by the Company, or the Holder of a breach of any provision of this Note shall not operate as or
be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of
the Company, or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered
a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note. Any
waiver by the Company, or the Holder must be in writing. No provision of this Agreement may be waived or amended except in a written
instrument signed, in the case of amendments, by the Company and the Majority Purchasers or, in the case of a waiver, by the party against
whom enforcement of any such waiver is sought. Any such amendment provision shall not be construed to mean that the Beneficial Ownership
Limitation of this Note may be amended other than as set forth in Section 4(c).


 


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


 


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


 


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


 


i)
Assumption. Any successor to the Company or any surviving entity in a Fundamental Transaction shall (i) assume, prior to such
Fundamental Transaction, all of the obligations of the Company under this Note and the other Transaction Documents pursuant to written
agreements in form and substance satisfactory to the Holder (such approval not to be unreasonably withheld or delayed) and (ii) issue
to the Holder a new Note of such successor entity evidenced by a written instrument substantially similar in form and substance to this
Note, including, without limitation, having a principal amount and interest rate equal to the principal amount and the interest rate
of this Note and having similar ranking to this Note, which shall be satisfactory to the Holder (any such approval not to be unreasonably
withheld or delayed). The provisions of this Section 9(i) shall apply similarly and equally to successive Fundamental Transactions and
shall be applied without regard to any limitations of this Note.


 


j)
Senior Secured Obligation. The Notes will be senior to all obligations of the Company, other than (i) the $60,192 of indebtedness
to Mitsubishi HC Capital America, Inc. and (ii) $85,075 of indebtedness to Amur Equipment Finance, Inc. with respect to which it is pari
passu in right of payment with and subject to the lien on the assets securing such indebtedness). The obligations of the Company under
this Note are secured by a first lien (other than certain equipment which is currently pledged to secure the indebtedness referenced
above, in respect of which it shall have a second lien) on all of the current and future assets of the Company, its Subsidiaries and
limited liability companies, in each case pursuant to the Security Agreement, dated as of the date hereof between the Company, its Subsidiaries
and the Holder.


 


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


 


(Signature
Pages Follow)


 




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


 


	 	WHITE
    RIVER ENERGY CORP
	 	 	 
	 	By:	      
	 	 	 
	 	Name:	
	 	Title:	
	 	 	 
	 	Facsimile No. for delivery of Notices: 


 




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