EXHIBIT 4.2


 


CERTIFICATE OF DESIGNATIONS, PREFERENCES
AND RIGHTS OF THE

0% SERIES A CONVERTIBLE PREFERRED STOCK OF

MAJESCO ENTERTAINMENT COMPANY


 


I, Jesse Sutton, hereby
certify that I am the Chief Executive Officer of Majesco Entertainment Company (the “Company”), a corporation
organized and existing under the Delaware General Corporation Law (the “DGCL”), and further do hereby certify:


 


That pursuant to the
authority expressly conferred upon the Board of Directors of the Company (the “Board”) by the Company’s
Certificate of Incorporation, as amended (the “Certificate of Incorporation”), the Board on December 10, 2014
adopted the following resolutions creating a series of shares of Preferred Stock designated as 0% Series A Convertible Preferred
Stock, none of which shares have been issued:


 


RESOLVED, that the
Board designates the 0% Series A Convertible Preferred Stock and the number of shares constituting such series, and fixes the rights,
powers, preferences, privileges and restrictions relating to such series in addition to any set forth in the Certificate of Incorporation
as follows:


 


TERMS OF SERIES A CONVERTIBLE PREFERRED STOCK


 


1.          Designation
and Number of Shares. There shall hereby be created and established a series of preferred stock of the Company designated as
“0% Series A Convertible Preferred Stock” (the “Preferred Shares”). The authorized number of Preferred
Shares shall be 8,830,000 shares. Each Preferred Share shall have $0.001 par value. Capitalized terms not defined herein shall
have the meaning as set forth in Section 23 below.


 


2.          Ranking.
Except to the extent that the holders of at least a majority of the outstanding Preferred Shares (the “Required Holders”)
expressly consent to the creation of Parity Stock (as defined below) or Senior Preferred Stock (as defined below) in accordance
with Section 12, all shares of capital stock of the Company shall be junior in rank to all Preferred Shares with respect to the
preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (such junior
stock is referred to herein collectively as “Junior Stock”). The rights of all such shares of capital stock
of the Company shall be subject to the rights, powers, preferences and privileges of the Preferred Shares. Without limiting any
other provision of this Certificate of Designations, without the prior express consent of the Required Holders, voting separately
as a single class, the Company shall not hereafter authorize or issue any additional or other shares of capital stock that is (i)
of senior rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation,
dissolution and winding up of the Company (collectively, the “Senior Preferred Stock”), (ii) of pari passu rank
to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution
and winding up of the Company (collectively, the “Parity Stock”) or (iii) any Junior Stock having a maturity
date (or any other date requiring redemption or repayment of such shares of Junior Stock) that is prior to the date no Preferred
Shares remain outstanding. In the event of the merger or consolidation of the Company with or into another corporation, the Preferred
Shares shall maintain their relative rights, powers, designations, privileges and preferences provided for herein and no such merger
or consolidation shall result inconsistent therewith.


 




    	 



    	 



    

 


3.          Dividends.
In addition to Sections 5(a) and 11 below, from and after the first date of issuance of any Preferred Shares (the “Initial
Issuance Date”), each holder of a Preferred Share (each, a “Holder” and collectively, the “Holders”)
shall be entitled to receive dividends (“Dividends”) when and as declared by the Board, from time to time, in
its sole discretion, which Dividends shall be paid by the Company out of funds legally available therefor, payable, subject to
the conditions and other terms hereof, in cash on the Stated Value of such Preferred Share.


 


4.          Conversion.
Each Preferred Share shall be convertible into validly issued, fully paid and non-assessable shares of Common Stock (as defined
below) on the terms and conditions set forth in this Section 4.


 


(a)          Holder’s
Conversion Right. Subject to the provisions of Section 4(e) and 4(f), at any time or times on or after the Initial Issuance
Date, each Holder shall be entitled to convert any whole number of Preferred Shares into validly issued, fully paid and non-assessable
shares of Common Stock in accordance with Section 4(c) at the Conversion Rate (as defined below).


 


(b)          Conversion
Rate. The number of validly issued, fully paid and non-assessable shares of Common Stock issuable upon conversion of each Preferred
Share pursuant to Section 4(a) shall be determined according to the following formula (the “Conversion Rate”):


 


Base Amount

Conversion Price


 


No fractional
shares of Common Stock are to be issued upon the conversion of any Preferred Shares. If the issuance would result in the issuance
of a fraction of a share of Common Stock, the Company shall round such fraction of a share of Common Stock up to the nearest whole
share.


 


(c)          Mechanics
of Conversion. The conversion of each Preferred Share shall be conducted in the following manner:


 


(i)         Holder’s
Conversion. To convert a Preferred Share into validly issued, fully paid and non-assessable shares of Common Stock on any date
(a “Conversion Date”), a Holder shall deliver (whether via facsimile 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 of the share(s) of Preferred Shares subject
to such conversion in the form attached hereto as Exhibit I (the “Conversion Notice”) to the Company.
If required by Section 4(c)(vi), within five (5) Trading Days following a conversion of any such Preferred Shares as aforesaid,
such Holder shall surrender to a nationally recognized overnight delivery service for delivery to the Company the original certificates
representing the share(s) of Preferred Shares (the “Preferred Share Certificates”) so converted as aforesaid.


 




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(ii)         Company’s
Response. On or before the first (1st) Trading Day following the date of receipt of a Conversion Notice, the Company
shall transmit by facsimile an acknowledgment of confirmation, in the form attached hereto as Exhibit II, of receipt
of such Conversion Notice to such Holder and the Transfer Agent, which confirmation shall constitute an instruction to the Transfer
Agent to process such Conversion Notice in accordance with the terms herein. On or before the second (2nd) Trading Day
following the date of receipt by the Company of such Conversion Notice, the Company shall (1) provided that the Transfer Agent
is participating in DTC Fast Automated Securities Transfer Program, credit such aggregate number of shares of Common Stock to which
such Holder shall be entitled to such 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, issue
and deliver (via reputable overnight courier) to the address as specified in such Conversion Notice, a certificate, registered
in the name of such Holder or its designee, for the number of shares of Common Stock to which such Holder shall be entitled. If
the number of Preferred Shares represented by the Preferred Share Certificate(s) submitted for conversion pursuant to Section 4(c)(vi)
is greater than the number of Preferred Shares being converted, then the Company shall if requested by such Holder, as soon as
practicable and in no event later than three (3) Trading Days after receipt of the Preferred Share Certificate(s) and at its own
expense, issue and deliver to such Holder (or its designee) a new Preferred Share Certificate representing the number of Preferred
Shares not converted.


 


(iii)         Record
Holder. The Person or Persons entitled to receive the shares of Common Stock issuable upon a conversion of Preferred Shares
shall be treated for all purposes as the record holder or holders of such shares of Common Stock on the Conversion Date.


 




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(iv)         Company’s
Failure to Timely Convert. If the Company shall fail, for any reason or for no reason, to issue to a Holder within three (3)
Trading Days after the Company’s receipt of a Conversion Notice (whether via facsimile or otherwise) (the “Share
Delivery Deadline”), a certificate for the number of shares of Common Stock to which such Holder is entitled and register
such shares of Common Stock on the Company’s share register or to credit such Holder’s or its designee’s balance
account with DTC for such number of shares of Common Stock to which such Holder is entitled upon such Holder’s conversion
of any Preferred Shares (as the case may be) (a “Conversion Failure”), then, in addition to all other remedies
available to such Holder, such Holder, upon written notice to the Company, (x) may void its Conversion Notice with respect to,
and retain or have returned (as the case may be) any Preferred Shares that have not been converted pursuant to such Holder’s
Conversion Notice, provided that the voiding of a Conversion Notice shall not affect the Company’s obligations to make any
payments which have accrued prior to the date of such notice pursuant to the terms of this Certificate of Designations or otherwise
and (y) the Company shall pay in cash to such Holder on each day after such third (3rd) Trading Day that the issuance
of such shares of Common Stock is not timely effected an amount equal to 1.5% of the product of (A) the aggregate number of shares
of Common Stock not issued to such Holder on a timely basis and to which the Holder is entitled and (B) the Closing Sale Price
of the Common Stock on the Trading Day immediately preceding the last possible date on which the Company could have issued such
shares of Common Stock to the Holder without violating Section 4(c). In addition to the foregoing, if within three (3) Trading
Days after the Company’s receipt of a Conversion Notice (whether via facsimile or otherwise), the Company shall fail to issue
and deliver a certificate to such Holder and register such shares of Common Stock on the Company’s share register or credit
such Holder’s or its designee’s balance account with DTC for the number of shares of Common Stock to which such Holder
is entitled upon such Holder’s conversion hereunder (as the case may be), and if on or after such third (3rd)
Trading Day such Holder (or any other Person in respect, or on behalf, of such Holder) purchases (in an open market transaction
or otherwise) shares of Common Stock to deliver in satisfaction of a sale by such Holder of all or any portion of the number of
shares of Common Stock, or a sale of a number of shares of Common Stock equal to all or any portion of the number of shares of
Common Stock, issuable upon such conversion that such Holder so anticipated receiving from the Company, then, in addition to all
other remedies available to such Holder, the Company shall, within three (3) Business Days after such Holder’s request and
in such Holder’s discretion, either (i) pay cash to such Holder in an amount equal to such Holder’s total purchase
price (including brokerage commissions and other out-of-pocket expenses, if any) for the shares of Common Stock so purchased (including,
without limitation, by any other Person in respect, or on behalf, of such Holder) (the “Buy-In Price”), at which
point the Company’s obligation to so issue and deliver such certificate or credit such Holder’s balance account with
DTC for the number of shares of Common Stock to which such Holder is entitled upon such Holder’s conversion hereunder (as
the case may be) (and to issue such shares of Common Stock) shall terminate, or (ii) promptly honor its obligation to so issue
and deliver to such Holder a certificate or certificates representing such shares of Common Stock or credit such Holder’s
balance account with DTC for the number of shares of Common Stock to which such Holder is entitled upon such Holder’s conversion
hereunder (as the case may be) and pay cash to such Holder in an amount equal to the excess (if any) of the Buy-In Price over the
product of (A) such number of shares of Common Stock multiplied by (B) the lowest Closing Sale Price of the Common Stock on any
Trading Day during the period commencing on the date of the applicable Conversion Notice and ending on the date of such issuance
and payment under this clause (ii).


 




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(v)          Pro
Rata Conversion; Disputes. In the event the Company receives a Conversion Notice from more than one Holder for the same Conversion
Date and the Company can convert some, but not all, of such Preferred Shares submitted for conversion, the Company shall convert
from each Holder electing to have Preferred Shares converted on such date a pro rata amount of such Holder’s Preferred Shares
submitted for conversion on such date based on the number of Preferred Shares submitted for conversion on such date by such Holder
relative to the aggregate number of Preferred Shares submitted for conversion on such date. In the event of a dispute as to the
number of shares of Common Stock issuable to a Holder in connection with a conversion of Preferred Shares, the Company shall issue
to such Holder the number of shares of Common Stock not in dispute and resolve such dispute in accordance with Section 22.


 


(vi)          Book-Entry.
Notwithstanding anything to the contrary set forth in this Section 4, upon conversion of any Preferred Shares in accordance with
the terms hereof, no Holder thereof shall be required to physically surrender the certificate representing the Preferred Shares
to the Company following conversion thereof unless (A) the full or remaining number of Preferred Shares represented by the certificate
are being converted (in which event such certificate(s) shall be delivered to the Company as contemplated by this Section 4(c)(vi))
or (B) such Holder has provided the Company with prior written notice (which notice may be included in a Conversion Notice) requesting
reissuance of Preferred Shares upon physical surrender of any Preferred Shares. Each Holder and the Company shall maintain records
showing the number of Preferred Shares so converted by such Holder and the dates of such conversions or shall use such other method,
reasonably satisfactory to such Holder and the Company, so as not to require physical surrender of the certificate representing
the Preferred Shares upon each such conversion. In the event of any dispute or discrepancy, such records of such Company establishing
the number of Preferred Shares to which the record holder is entitled shall be controlling and determinative in the absence of
manifest error. A Holder and any transferee or assignee, by acceptance of a certificate, acknowledge and agree that, by reason
of the provisions of this paragraph, following conversion of any Preferred Shares, the number of Preferred Shares represented by
such certificate may be less than the number of Preferred Shares stated on the face thereof. Each certificate for Preferred Shares
shall bear the following legend:


 


ANY TRANSFEREE OR ASSIGNEE OF THIS
CERTIFICATE SHOULD CAREFULLY REVIEW THE TERMS OF THE CORPORATION’S CERTIFICATE OF DESIGNATIONS RELATING TO THE SHARES OF
SERIES A PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE, INCLUDING SECTION 4(c)(vi) THEREOF. THE NUMBER OF SHARES OF SERIES A
PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE MAY BE LESS THAN THE NUMBER OF SHARES OF SERIES A PREFERRED STOCK STATED ON THE
FACE HEREOF PURSUANT TO SECTION 4(c)(vi) OF THE CERTIFICATE OF DESIGNATIONS RELATING TO THE SHARES OF SERIES A PREFERRED STOCK
REPRESENTED BY THIS CERTIFICATE.


 




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(d)          Taxes.
The Company shall pay any and all documentary, stamp, transfer (but only in respect of the registered holder thereof), issuance
and other similar taxes that may be payable with respect to the issuance and delivery of shares of Common Stock upon the conversion
of Preferred Shares.


 


(e)          Limitation
on Beneficial Ownership. Notwithstanding anything to the contrary set forth in this Certificate of Designation, at no time
may all or a portion of the Series A Preferred Stock be converted if the number of shares of Common Stock to be issued pursuant
to such conversion would exceed, when aggregated with all other shares of Common Stock owned by the Holder at such time, the number
of shares of Common Stock which would result in the Holder beneficially owning (as determined in accordance with Section 13(d)
of the 1934 Act and the rules thereunder) more than 4.99% of all of the Common Stock outstanding at such time (the “4.99%
Beneficial Ownership Limitation”); provided, however, that upon the Holder providing the Corporation with sixty-one (61)
days’ advance notice (the “4.99% Waiver Notice”) that the Holder would like to waive this Section 4(e)
with regard to any or all shares of Common Stock issuable upon conversion of the Preferred Shares, this Section 4(e) will be of
no force or effect with regard to all or a portion of the Series A Preferred Stock referenced in the 4.99% Waiver Notice but shall
in no event waive the 9.99% Beneficial Ownership Limitation described below. Notwithstanding anything to the contrary set forth
in this Certificate of Designation, at no time may all or a portion of the Preferred Shares be converted if the number of shares
of Common Stock to be issued pursuant to such conversion, when aggregated with all other shares of Common Stock owned by the Holder
at such time, would result in the Holder beneficially owning (as determined in accordance with Section 13(d) of the 1934 Act and
the rules thereunder) in excess of 9.99% of the then issued and outstanding shares of Common Stock outstanding at such time (the
“9.99% Beneficial Ownership Limitation” and the lower of the 9.99% Beneficial Ownership Limitation and the 4.99%
Beneficial Ownership Limitation then in effect, the “Maximum Percentage”)). By written notice to the Company,
a holder of Preferred Shares may from time to time decrease the Maximum Percentage to any other percentage specified in such notice.
For purposes hereof, in determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding
shares of Common Stock as reflected in (1) the Company’s most recent Form 10-K, Form 10-Q, Current Report on Form 8-K or
other public filing with the Securities and Exchange Commission, as the case may be, (2) a more recent public announcement by the
Company or (3) any other notice by the Company setting forth the number of shares of Common Stock outstanding. For any reason at
any time, upon the written or oral request of a holder of Preferred Shares, the Company shall within three (3) Business Days confirm
orally and in writing to such 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
the Preferred Shares, by the Holder and its Affiliates since the date as of which such number of outstanding shares of Common Stock
was reported, which in any event are convertible or exercisable, as the case may be, into shares of the Company’s Common
Stock within 60 days’ of such calculation and which are not subject to a limitation on conversion or exercise analogous to
the limitation contained herein. The provisions of this paragraph shall be construed and implemented in a manner otherwise than
in strict conformity with the terms of this Section 4(e) to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended beneficial ownership limitation herein contained or to make changes or supplements necessary
or desirable to properly give effect to such limitation.


 




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(f)          Issuance
Restrictions. (i) If the Company has not obtained the approval of its shareholders in accordance with NASDAQ Listing Rule 5635(d),
then the Company may not issue upon conversion of the Preferred Shares a number of shares of Common Stock, which, when aggregated
with any shares of Common Stock (i) issued pursuant to the Subscription Agreement, (ii) underlying the Preferred Shares issued
pursuant to the Subscription Agreement; (iii) issuable upon prior exercise of any Warrants issued pursuant to the Subscription
Agreement and (iv) issuable pursuant to any warrants issued to any registered broker-dealer as a fee in connection with the issuance
of Securities pursuant to the Subscription Agreement, would exceed 19.99% of the shares of Common Stock issued and outstanding
as of the Subscription Date, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and
other similar transactions of the Common Stock that occur after the date of the Subscription Agreement (such number of shares,
the “Issuable Maximum”). The Holder and the holders of the other Preferred Shares issued pursuant to the Subscription
Agreement shall be entitled to a portion of the Issuable Maximum equal to the quotient obtained by dividing (x) the Holder’s
original Aggregate Purchase Price by (y) the aggregate original Aggregate Purchase Price of all holders pursuant to the Subscription
Agreement. In addition, the Holder may allocate its pro-rata portion of the Issuable Maximum among Preferred Shares held by it
in its sole discretion. Such portion shall be adjusted upward ratably in the event a Holder no longer holds any Preferred Shares
and the amount of shares issued to such Holder pursuant to its Preferred Shares was less than such Holder’s pro-rata share
of the Issuable Maximum. For avoidance of doubt, unless and until any required Shareholder Approval is obtained and effective,
warrants issued to any registered broker-dealer as a fee in connection with the Securities issued pursuant to the Subscription
Agreement as described in clause (iii) above shall provide that such warrants shall not be allocated any portion of the Issuable
Maximum and shall be unexercisable unless and until such Shareholder Approval is obtained and effective.


 


5.          Rights
Upon Issuance of Purchase Rights and Other Corporate Events.


 


(a)          Purchase
Rights. In addition to any adjustments pursuant to Section 7 below, if at any time the Company grants, issues or sells any
Options, Convertible Securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders
of any class of Common Stock (the “Purchase Rights”), then each Holder will be entitled to acquire, upon the
terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder had
held the number of shares of Common Stock acquirable upon complete conversion of all the Preferred Shares (without taking into
account any limitations or restrictions on the convertibility of the Preferred Shares) held by such Holder immediately before the
date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date
as of which the record holders of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided,
however, to the extent that such Holder’s right to participate in any such Purchase Right would result in such Holder exceeding
the Maximum Percentage, then such Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial
ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent
shall be held in abeyance for such Holder until such time, if ever, as its right thereto would not result in such Holder exceeding
the Maximum Percentage).


 




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


 


6.          Rights
Upon Fundamental Transactions.


 


(a)          Assumption.
The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes in writing
all of the obligations of the Company under this Certificate of Designations and the other Transaction Documents in accordance
with the provisions of this Section 6 pursuant to written agreements in form and substance satisfactory to the Required Holders
and approved by the Required Holders prior to such Fundamental Transaction, including agreements to deliver to each holder of Preferred
Shares in exchange for such Preferred Shares a security of the Successor Entity evidenced by a written instrument substantially
similar in form and substance to this Certificate of Designations, including, without limitation, having a stated value and dividend
rate equal to the stated value and dividend rate of the Preferred Shares held by the Holders and having similar ranking to the
Preferred Shares, and reasonably satisfactory to the Required Holders and (ii) the Successor Entity (including its Parent
Entity) is a publicly traded corporation whose shares of common stock are 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 Certificate of Designations 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 Certificate of Designations and the other
Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein and therein. In addition
to the foregoing, upon consummation of a Fundamental Transaction, the Successor Entity shall deliver to each Holder confirmation
that there shall be issued upon conversion of the Preferred Shares at any time after the consummation of such Fundamental Transaction,
in lieu of the shares of Common Stock (or other securities, cash, assets or other property (except such items still issuable under
Sections 5 and 11, which shall continue to be receivable thereafter)) issuable upon the conversion of the Preferred Shares prior
to such Fundamental Transaction, such shares of publicly traded common stock (or their equivalent) of the Successor Entity (including
its Parent Entity) which each Holder would have been entitled to receive upon the happening of such Fundamental Transaction had
all the Preferred Shares held by each Holder been converted immediately prior to such Fundamental Transaction (without regard to
any limitations on the conversion of the Preferred Shares contained in this Certificate of Designations), as adjusted in accordance
with the provisions of this Certificate of Designations. The provisions of this Section 6 shall apply similarly and equally to
successive Fundamental Transactions and shall be applied without regard to any limitations on the conversion of the Preferred Shares.


 




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7.          Rights
Upon Issuance of Other Securities.


 


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


 


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


 




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


 




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


 


(iv)          Calculation
of Consideration Received. If any Option or Convertible Security is issued in connection with the issuance or sale or deemed
issuance or sale of any other securities of the Company (including, without limitation, any other Option or Convertible Security),
together comprising one integrated transaction, (x) such Option or Convertible Security (as applicable) will be deemed to have
been issued for consideration equal to the fair market value thereof as determined in good faith by the Company’s Board of
Directors and (y) the other securities issued or sold or deemed to have been issued or sold in such integrated transaction shall
be deemed to have been issued for consideration equal to the difference of (I) the aggregate consideration received by the Company
minus (II) the aggregate fair market value of all such Options and/or Convertible Securities (as applicable) so issued. If any
shares of Common Stock, Options or Convertible Securities are issued or sold or deemed to have been issued or sold for cash, the
consideration received therefor will be deemed to be the net amount of consideration received by the Company therefor. If any shares
of Common Stock, Options or Convertible Securities are issued or sold for a consideration other than cash, the amount of such consideration
received by the Company will be the fair value of such consideration, except where such consideration consists of publicly traded
securities, in which case the amount of consideration received by the Company for such securities will be the arithmetic average
of the VWAPs of such security for each of the five (5) Trading Days immediately preceding the date of receipt. If any shares of
Common Stock, Options or Convertible Securities are issued to the owners of the non-surviving entity in connection with any merger
in which the Company is the surviving entity, the amount of consideration therefor will be deemed to be the fair value of such
portion of the net assets and business of the non-surviving entity as is attributable to such shares of Common Stock, Options or
Convertible Securities, as the case may be. The fair value of any consideration other than cash or publicly traded securities will
be determined jointly by the Company and the Required Holders. If such parties are unable to reach agreement within ten (10) days
after the occurrence of an event requiring valuation (the “Valuation Event”), the fair value of such consideration
will be determined within five (5) Trading Days after the tenth (10th) day following such Valuation Event by an independent,
reputable appraiser jointly selected by the Company and the Required Holders. The determination of such appraiser shall be final
and binding upon all parties absent manifest error and the fees and expenses of such appraiser shall be borne by the Company.


 




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(v)          Record
Date. If the Company takes a record of the holders of shares of Common Stock for the purpose of entitling them (A) to receive
a dividend or other distribution payable in shares of Common Stock, Options or in Convertible Securities or (B) to subscribe for
or purchase shares of Common Stock, Options or Convertible Securities, then such record date will be deemed to be the date of the
issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making
of such other distribution or the date of the granting of such right of subscription or purchase (as the case may be).


 


(b)          Adjustment
of Conversion Price upon Subdivision or Combination of Common Stock. Without limiting any provision of Sections 5 and 11, if
the Company at any time on or after the Subscription Date subdivides (by any stock split, stock dividend, recapitalization or otherwise)
one or more classes of its outstanding shares of Common Stock into a greater number of shares, the Conversion Price in effect immediately
prior to such subdivision will be proportionately reduced. Without limiting any provision of Sections 5 and 11, if the Company
at any time on or after the Subscription Date combines (by combination, reverse stock split or otherwise) one or more classes of
its outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to such
combination will be proportionately increased. Any adjustment pursuant to this Section 7(b) shall become effective immediately
after the effective date of such subdivision or combination. If any event requiring an adjustment under this Section 7(b) occurs
during the period that a Conversion Price is calculated hereunder, then the calculation of such Conversion Price shall be adjusted
appropriately to reflect such event.


 


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


 




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


 


8.          Authorized
Shares.


 


(a)          Reservation.
The Company shall initially reserve out of its authorized and unissued Common Stock a number of shares of Common Stock equal to
125% of the Conversion Rate with respect to the Base Amount of each Preferred Share as of the Initial Issuance Date (assuming for
purposes hereof, that all the Preferred Shares issuable pursuant to the Subscription Agreement have been issued, such Preferred
Shares are convertible at the Conversion Price and without taking into account any limitations on the conversion of such Preferred
Shares set forth in herein) issuable pursuant to the terms of this Certificate of Designations from the Initial Issuance Date through
the second anniversary of the Initial Issuance Date assuming (assuming for purposes hereof, that all the Preferred Shares issuable
pursuant to the Subscription Agreement have been issued and without taking into account any limitations on the issuance of securities
set forth herein). So long as any of the Preferred Shares are outstanding, the Company shall take all action necessary to reserve
and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the conversion
of the Preferred Shares, as of any given date, 125% of the number of shares of Common Stock as shall from time to time be necessary
to effect the conversion of all of the Preferred Shares issued or issuable pursuant to the Subscription Agreement assuming for
purposes hereof, that all the Preferred Shares issuable pursuant to the Subscription Agreement have been issued and without taking
into account any limitations on the issuance of securities set forth herein), provided that at no time shall the number of shares
of Common Stock so available be less than the number of shares required to be reserved by the previous sentence (without regard
to any limitations on conversions contained in this Certificate of Designations) (the “Required Amount”). The
initial number of shares of Common Stock reserved for conversions of the Preferred Shares and each increase in the number of shares
so reserved shall be allocated pro rata among the Holders based on the number of Preferred Shares held by each Holder on the Initial
Issuance Date or increase in the number of reserved shares (as the case may be) (the “Authorized Share Allocation”).
In the event a Holder shall sell or otherwise transfer any of such Holder’s Preferred Shares, each transferee shall be allocated
a pro rata portion of such Holder’s Authorized Share Allocation. Any shares of Common Stock reserved and allocated to any
Person which ceases to hold any Preferred Shares shall be allocated to the remaining Holders of Preferred Shares, pro rata based
on the number of Preferred Shares then held by such Holders.


 




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(b)          Insufficient
Authorized Shares. If, notwithstanding Section 8(a) and not in limitation thereof, at any time while any of the Preferred Shares
remain outstanding the Company does not have a sufficient number of authorized and unissued shares of Common Stock to satisfy its
obligation to have available for issuance upon conversion of the Preferred Shares at least a number of shares of Common Stock equal
to the Required Amount (an “Authorized Share Failure”), then the Company shall promptly take all action necessary
to increase the Company’s authorized shares of Common Stock to an amount sufficient to allow the Company to reserve and have
available the Required Amount for all of the Preferred Shares 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 ninety
(90) days after the occurrence of such Authorized Share Failure, the Company shall hold a meeting of its stockholders or conduct
a consent solicitation for the approval of an increase in the number of authorized shares of Common Stock. In connection with such
meeting, the Company shall provide each stockholder with a proxy statement and shall use its best efforts to solicit its stockholders’
approval of such increase in authorized shares of Common Stock and to cause its Board to recommend to the stockholders that they
approve such proposal. Nothing contained in this Section 8 shall limit any obligations of the Company under any provision of the
Subscription Agreement. In the event that the Company is prohibited from issuing shares of Common Stock upon a conversion of any
Preferred Share due to the failure by the Company to have sufficient shares of Common Stock available out of the authorized but
unissued shares of Common Stock (such unavailable number of shares of Common Stock, the “Authorization Failure Shares”),
in lieu of delivering such Authorization Failure Shares to such Holder of such Preferred Shares, the Company shall pay cash in
exchange for the cancellation of such Preferred Shares convertible into such Authorized Failure Shares at a price equal to the
sum of (i) the product of (x) such number of Authorization Failure Shares and (y) the Closing Sale Price on the Trading Day immediately
preceding the date such Holder delivers the applicable Conversion Notice with respect to such Authorization Failure Shares to the
Company and (ii) to the extent such Holder purchases (in an open market transaction or otherwise) shares of Common Stock to deliver
in satisfaction of a sale by such Holder of Authorization Failure Shares, any brokerage commissions and other out-of-pocket expenses,
if any, of such Holder incurred in connection therewith.


 


9.          Voting
Rights. Except as otherwise expressly required by law, each holder of Preferred Shares shall be entitled to vote on all matters
submitted to shareholders of the Company and shall be entitled to the number of votes for each Preferred Share owned at the record
date for the determination of shareholders entitled to vote on such matter or, if no such record date is established, at the date
such vote is taken or any written consent of shareholders is solicited, equal to the number of shares of Common Stock such Preferred
Shares are convertible into (voting as a class with Common Stock) based on the Conversion Price in effect on such date, but in
no event shall the Conversion Price used for purposes of calculating voting rights pursuant to this Section 9 be less than $0.59
(the “Voting Floor”), representing the consolidated closing bid price of the Common Stock on The NASDAQ Stock
Market LLC on the date prior to the execution of the Subscription Agreement, but not in excess of the conversion limitations set
forth in Section 4(e) and/or 4(f) herein. The Voting Floor shall only be removed in accordance with NASDAQ Listing Rules. 
Except as otherwise required by law, the holders of Preferred Shares shall vote together with the holders of Common Stock on all
matters and shall not vote as a separate class. For the avoidance of doubt, the Voting Floor shall not prohibit any adjustment
to the Conversion Price below $0.59 with respect to any other section of this Certificate of Designations or any other rights of
the Holder hereunder.


 




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10.         Liquidation,
Dissolution, Winding-Up. In the event of a Liquidation Event, the Holders shall be entitled to receive in cash out of the assets
of the Company, whether from capital or from earnings available for distribution to its stockholders (the “Liquidation
Funds”), before any amount shall be paid to the holders of any of shares of Junior Stock, an amount per Preferred Share
equal to the greater of (A) the Base Amount thereof on the date of such payment and (B) the amount per share such Holder would
receive if such Holder converted such Preferred Shares into Common Stock immediately prior to the date of such payment, provided
that if the Liquidation Funds are insufficient to pay the full amount due to the Holders and holders of shares of Parity Stock,
then each Holder and each holder of Parity Stock shall receive a percentage of the Liquidation Funds equal to the full amount of
Liquidation Funds payable to such Holder and such holder of Parity Stock as a liquidation preference, in accordance with their
respective certificate of designations (or equivalent), as a percentage of the full amount of Liquidation Funds payable to all
holders of Preferred Shares and all holders of shares of Parity Stock. To the extent necessary, the Company shall cause such actions
to be taken by each of its Subsidiaries so as to enable, to the maximum extent permitted by law, the proceeds of a Liquidation
Event to be distributed to the Holders in accordance with this Section 10. All the preferential amounts to be paid to the Holders
under this Section 10 shall be paid or set apart for payment before the payment or setting apart for payment of any amount for,
or the distribution of any Liquidation Funds of the Company to the holders of shares of Junior Stock in connection with a Liquidation
Event as to which this Section 10 applies.


 


11.         Participation.
In addition to any adjustments pursuant to Section 7(b), the Holders shall, as holders of Preferred Shares, be entitled to receive
such dividends paid and distributions made to the holders of shares of Common Stock to the same extent as if such Holders had converted
each Preferred Share held by each of them into shares of Common Stock (without regard to any limitations on conversion herein or
elsewhere) and had held such shares of Common Stock on the record date for such dividends and distributions. Payments under the
preceding sentence shall be made concurrently with the dividend or distribution to the holders of shares of Common Stock (provided,
however, to the extent that a Holder’s right to participate in any such dividend or distribution would result in such Holder
exceeding the Maximum Percentage, then such Holder shall not be entitled to participate in such dividend or distribution to such
extent (or the beneficial ownership of any such shares of Common Stock as a result of such dividend or distribution to such extent)
and such dividend or distribution to such extent shall be held in abeyance for the benefit of such Holder until such time, if ever,
as its right thereto would not result in such Holder exceeding the Maximum Percentage).


 




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12.        Vote
to Change the Terms of or Issue Preferred Shares. In addition to any other rights provided by law, except where the vote or
written consent of the holders of a greater number of shares is required by law or by another provision of the Certificate of Incorporation,
without first obtaining the affirmative vote at a meeting duly called for such purpose or the written consent without a meeting
of the Required Holders, voting together as a single class, the Company shall not: (a) amend or repeal any provision of, or add
any provision to, its Certificate of Incorporation or bylaws, or file any certificate of designations or articles of amendment
of any series of shares of preferred stock, if such action would adversely alter or change in any respect the preferences, rights,
privileges or powers, or restrictions provided for the benefit, of the Preferred Shares, regardless of whether any such action
shall be by means of amendment to the Certificate of Incorporation or by merger, consolidation or otherwise; (b) increase or decrease
(other than by conversion) the authorized number of Preferred Shares; (c) without limiting any provision of Section 2, create or
authorize (by reclassification or otherwise) any new class or series of shares that has a preference over or is on a parity with
the Preferred Shares with respect to dividends or the distribution of assets on the liquidation, dissolution or winding up of the
Company; (d) purchase, repurchase or redeem any shares of capital stock of the Company junior in rank to the Preferred Shares (other
than pursuant to equity incentive agreements (that have in good faith been approved by the Board) with employees giving the Company
the right to repurchase shares upon the termination of services); (e) without limiting any provision of Section 2, pay dividends
or make any other distribution on any shares of any capital stock of the Company junior in rank to the Preferred Shares; (f) issue
any Preferred Shares other than pursuant to the Subscription Agreement; or (g) without limiting any provision of Section 16, whether
or not prohibited by the terms of the Preferred Shares, circumvent a right of the Preferred Shares.


 


13.        Covenants.


 


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


 


(b)          Existence
of Liens. The Company shall not, and the Company shall cause each of its Subsidiaries to not, 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.


 


(c)          Limitations
on Issuances and Financings. For as long as any Preferred Shares remain outstanding, the Company shall  not issue
any Common Stock or Convertible Securities (or modify any of the foregoing which may be outstanding) to any person or entity or
incur any financing debt, other than with regard to Excluded Securities, without the express written consent of the Lead Investor
(as defined in the Subscription Agreement).


 


14.        Lost
or Stolen Certificates. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of any certificates representing Preferred Shares (as to which a written certification and the indemnification
contemplated below shall suffice as such evidence), and, in the case of loss, theft or destruction, of an indemnification undertaking
by the applicable Holder to the Company in customary and reasonable form and, in the case of mutilation, upon surrender and cancellation
of the certificate(s), the Company shall execute and deliver new certificate(s) of like tenor and date.


 




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15.         Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate of Designations
shall be cumulative and in addition to all other remedies available under this Certificate of Designations and any of the other
Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and no
remedy contained herein shall be deemed a waiver of compliance with the provisions giving rise to such remedy. Nothing herein shall
limit any Holder’s right to pursue actual and consequential damages for any failure by the Company to comply with the terms
of this Certificate of Designations. The Company covenants to each 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 a 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 Holders 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, each Holder shall be entitled,
in addition to all other available remedies, to an injunction restraining any such breach or any such threatened breach, without
the necessity of showing economic loss and without any bond or other security being required. The Company shall provide all information
and documentation to a Holder that is requested by such Holder to enable such Holder to confirm the Company’s compliance
with the terms and conditions of this Certificate of Designations.


 


16.         Noncircumvention.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation, bylaws 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 Certificate of
Designations, and will at all times in good faith carry out all the provisions of this Certificate of Designations and take all
action as may be required to protect the rights of the Holders. Without limiting the generality of the foregoing or any other provision
of this Certificate of Designations, the Company (i) shall not increase the par value of any shares of Common Stock receivable
upon the conversion of any Preferred Shares above the Conversion Price then in effect, (ii) shall take all such actions as
may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of
Common Stock upon the conversion of Preferred Shares and (iii) shall, so long as any Preferred Shares are outstanding, take all
action necessary to reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose
of effecting the conversion of the Preferred Shares, the maximum number of shares of Common Stock as shall from time to time be
necessary to effect the conversion of the Preferred Shares then outstanding (without regard to any limitations on conversion contained
herein).


 


17.         Failure
or Indulgence Not Waiver. No failure or delay on the part of a Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and
signed by an authorized representative of the waiving party. This Certificate of Designations shall be deemed to be jointly drafted
by the Company and all Holders and shall not be construed against any Person as the drafter hereof.


 




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18.        Notices.
The Company shall provide each Holder of Preferred Shares with prompt written notice of all actions taken pursuant to the terms
of this Certificate of Designations, including in reasonable detail a description of such action and the reason therefor. Whenever
notice is required to be given under this Certificate of Designations, unless otherwise provided herein, such notice must be in
writing and shall be given in accordance with the Subscription Agreement. Without limiting the generality of the foregoing, the
Company shall give written notice to each Holder (i) promptly following any adjustment of the Conversion Price, setting forth in
reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen (15) days prior to the date on
which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Common Stock, (B)
with respect to any grant, issuances, or sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities
or other property to all holders of shares of Common Stock as a class 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 simultaneously with, such notice being provided to any Holder.


 


19.        Transfer
of Preferred Shares. Subject to the restrictions set forth in Subscription Agreement, a Holder may transfer some or all of
its Preferred Shares without the consent of the Company.


 


20.        Preferred
Shares Register. The Company shall maintain at its principal executive offices (or such other office or agency of the Company
as it may designate by notice to the Holders), a register for the Preferred Shares, in which the Company shall record the name,
address and facsimile number of the Persons in whose name the Preferred Shares have been issued, as well as the name and address
of each transferee. The Company may treat the Person in whose name any Preferred Shares is registered on the register as the owner
and holder thereof for all purposes, notwithstanding any notice to the contrary, but in all events recognizing any properly made
transfers.


 


21.        Stockholder
Matters; Amendment.


 


(a)          Stockholder
Matters. Any stockholder action, approval or consent required, desired or otherwise sought by the Company pursuant to the DGCL,
the Certificate of Incorporation, this Certificate of Designations or otherwise with respect to the issuance of Preferred Shares
may be effected by written consent of the Company’s stockholders or at a duly called meeting of the Company’s stockholders,
all in accordance with the applicable rules and regulations of the DGCL. This provision is intended to comply with the applicable
sections of the DGCL permitting stockholder action, approval and consent affected by written consent in lieu of a meeting.


 


(b)          Amendment.
This Certificate of Designations or any provision hereof may be amended by obtaining the affirmative vote at a meeting duly called
for such purpose, or written consent without a meeting in accordance with the DGCL, of the Required Holders, voting separate as
a single class, and with such other stockholder approval, if any, as may then be required pursuant to the DGCL and the Certificate
of Incorporation.


 




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22.         Dispute
Resolution.


 


(a)          Disputes
Over Closing Bid Price, Closing Sale Price, Conversion Price, VWAP or Fair Market Value.


 


(i) In the
case of a dispute relating to a Closing Bid Price, a Closing Sale Price, a Conversion Price, a VWAP or fair market value (as the
case may be) (including, without limitation, a dispute relating to the determination of any of the foregoing), the Company or such
applicable Holder (as the case may be) shall submit the dispute via facsimile (I) within two (2) Business Days after delivery of
the applicable notice giving rise to such dispute to the Company or such Holder (as the case may be) or (II) if no notice gave
rise to such dispute, at any time after such Holder learned of the circumstances giving rise to such dispute. If such Holder and
the Company are unable to resolve such dispute relating to such Closing Bid Price, such Closing Sale Price, such Conversion Price,
such VWAP or such fair market value (as the case may be) by 5:00 p.m. (New York time) on the third (3rd) Business Day
following such delivery by the Company or such Holder (as the case may be) of such dispute to the Company or such Holder (as the
case may be), then such Holder shall select an independent, reputable investment bank to resolve such dispute.


 


(ii) Such
Holder and the Company shall each deliver to such investment bank (x) a copy of the initial dispute submission so delivered in
accordance with the first sentence of this Section 22(a) and (y) 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 such Holder selected such investment bank (the “Dispute Submission Deadline”) (the documents
referred to in the immediately preceding clauses (x) and (y) are collectively referred to herein as the “Required Dispute
Documentation”) (it being understood and agreed that if either such 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 such Holder or otherwise requested by such investment bank, neither
the Company nor such 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).


 




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(iii) The
Company and such Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company and
such Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The
fees and 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.


 


(b)          Disputes
Over Arithmetic Calculation of the Conversion Rate.


 


(i) In the
case of a dispute as to the arithmetic calculation of a Conversion Rate, the Company or such Holder (as the case may be) shall
submit the disputed arithmetic calculation via facsimile (i) within two (2) Business Days after delivery of the applicable notice
giving rise to such dispute to the Company or such Holder (as the case may be) or (ii) if no notice gave rise to such dispute,
at any time after such Holder learned of the circumstances giving rise to such dispute. If such Holder and the Company are unable
to resolve such disputed arithmetic calculation of such Conversion Rate by 5:00 p.m. (New York time) on the third (3rd)
Business Day following such delivery by the Company or such Holder (as the case may be) of such disputed arithmetic calculation,
then such Holder shall select an independent, reputable accountant or accounting firm to perform such disputed arithmetic calculation.


 


(ii) Such
Holder and the Company shall each deliver to such accountant or accounting firm (as the case may be) (x) a copy of the initial
dispute submission so delivered in accordance with the first sentence of this Section 22(a) and (y) written documentation supporting
its position with respect to such disputed arithmetic calculation, 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 such Holder selected such accountant or accounting
firm (as the case may be) (the “Submission Deadline”) (the documents referred to in the immediately preceding
clauses (x) and (y) are collectively referred to herein as the “Required Documentation”) (it being understood
and agreed that if either such Holder or the Company fails to so deliver all of the Required Documentation by the Submission Deadline,
then the party who fails to so submit all of the Required Documentation shall no longer be entitled to (and hereby waives its right
to) deliver or submit any written documentation or other support to such accountant or accounting firm (as the case may be) with
respect to such disputed arithmetic calculation and such accountant or accounting firm (as the case may be) shall perform such
disputed arithmetic calculation based solely on the Required Documentation that was delivered to such accountant or accounting
firm (as the case may be) prior to the Submission Deadline). Unless otherwise agreed to in writing by both the Company and such
Holder or otherwise requested by such accountant or accounting firm (as the case may be), neither the Company nor such Holder shall
be entitled to deliver or submit any written documentation or other support to such accountant or accounting firm (as the case
may be) in connection with such disputed arithmetic calculation of the Conversion Rate (other than the Required Documentation).


 




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(iii) The
Company and such Holder shall cause such accountant or accounting firm (as the case may be) to perform such disputed arithmetic
calculation and notify the Company and such Holder of the results no later than ten (10) Business Days immediately following the
Submission Deadline. The fees and expenses of such accountant or accounting firm (as the case may be) shall be borne solely by
the Company, and such accountant’s or accounting firm’s (as the case may be) arithmetic calculation shall be final
and binding upon all parties absent manifest error.


 


(c)          Miscellaneous.
The Company expressly acknowledges and agrees that (i) this Section 22 constitutes an agreement to arbitrate between the Company
and such Holder (and constitutes an arbitration agreement) under § 7501, et seq. of the New York Civil Practice Law and Rules
(“CPLR”) and that each party shall be entitled to compel arbitration pursuant to CPLR § 7503(a) in order
to compel compliance with this Section 22, (ii) a dispute relating to a Conversion Price includes, without limitation, disputes
as to (1) whether an issuance or sale or deemed issuance or sale of Common Stock occurred under Section 7(a), (2) the consideration
per share at which an issuance or deemed issuance of Common Stock occurred, (3) whether any issuance or sale or deemed issuance
or sale of Common Stock was an issuance or sale or deemed issuance or sale of Excluded Securities, (4) whether an agreement, instrument,
security or the like constitutes and Option or Convertible Security and (5) whether a Dilutive Issuance occurred, (iii) the terms
of this Certificate of Designations 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 Certificate of Designations and any other applicable Transaction Documents, (iv)
the terms of this Certificate of Designations and each other applicable Transaction Document shall serve as the basis for the selected
accountant’s or accounting firm’s performance of the applicable arithmetic calculation, (v) for clarification purposes
and without implication that the contrary would otherwise be true, disputes relating to matters described in Section 22(a) shall
be governed by Section 22(a) and not by Section 22(b), (vi) such Holder (and only such Holder), in its sole discretion, shall have
the right to submit any dispute described in this Section 22 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 22 and (vii) nothing in this Section 22 shall limit
such Holder from obtaining any injunctive relief or other equitable remedies (including, without limitation, with respect to any
matters described in Section 22(a) or Section 22(b)).


 




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23.         Certain
Defined Terms. For purposes of this Certificate of Designations, the following terms shall have the following meanings:


 


(a)          “1934
Act” means the Securities Exchange Act of 1934, as amended.


 


(b)          “Affiliate”
as applied to any Person, means any other Person directly or indirectly controlling, controlled by, or under common control with,
that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms
“controlling”, “controlled by” and “under common control with”), as applied
to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or by contract or otherwise. For purposes of this definition,
a Person shall be deemed to be “controlled by” a Person if such latter Person possesses, directly or indirectly,
power to vote 10% or more of the securities having ordinary voting power for the election of directors of such former Person.


 


(c)          “Approved
Stock Plan” means any benefit or incentive plan which has been approved by the board of directors of the Company prior
to or subsequent to the date hereof pursuant to which shares of Common Stock and options or equivalent Common Stock linked interests
may be issued to any employee, officer, director or consultant for services provided to the Company.


 


(d)          “Base
Amount” means, with respect to each Preferred Share, as of the applicable date of determination, the sum of (1) the Stated
Value thereof, plus (2) the Unpaid Dividend Amount thereon as of such date of determination.


 


(e)          “Bloomberg”
means Bloomberg, L.P.


 


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


 


(g)          “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 Bloomberg, 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 Bloomberg, 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 Bloomberg, 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 Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the Closing 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 applicable Holder. If the Company and such 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 22. All such determinations shall be appropriately
adjusted for any stock dividend, stock split, stock combination or other similar transaction during such period.


 




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(h)          “Common
Stock” means (i) the Company’s shares of common stock, par value $0.001 per share, and (ii) any capital stock
into which such common stock shall have been changed or any share capital resulting from a reclassification of such common stock.


 


(i)          “Conversion
Price” means, with respect to each Preferred Share, as of any Conversion Date or other applicable date of determination,
$0.68, subject to adjustment as provided herein.


 


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


 


(k)          “Eligible
Market” means The New York Stock Exchange, the NYSE MKT, the Nasdaq Global Select Market, the Nasdaq Global Market, the
NASDAQ Capital Market, the OTCBB, the OTCQX, the OTCQB or the Principal Market (or any successor thereto).


 


(l)          “Excluded
Securities” means any (i) shares of Common Stock or options to purchase Common Stock issued to directors, officers, employees
or consultants of the Company pursuant to any Approved Stock Plan adopted on or following the Initial Issuance Date, provided that
(A) all such issuances (taking into account the shares of Common Stock issuable upon exercise of such options) after the Initial
Issuance Date pursuant to this clause (i) do not, in the aggregate, exceed more than 15% of the Common Stock issued and outstanding
at the time of such issuance and (B) the exercise price of any such options is not lowered after issuance by subsequent amendment
thereof, none of such options are amended subsequent to issuance to increase the number of shares issuable thereunder and none
of the terms or conditions of any such options are subsequent to issuance otherwise materially changed in any manner that adversely
affects any of the Holders; (ii) shares of Common Stock issued upon the conversion or exercise of Convertible Securities or contractual
agreements (other than options to purchase Common Stock or other equity incentive awards issued pursuant to an Approved Stock Plan
that are covered by clause (i) above) issued prior to the date hereof, provided that the conversion price of any such Convertible
Securities (other than options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i)
above) is not lowered by subsequent amendment, none of such Convertible Securities (other than standard options to purchase Common
Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are subsequently amended to increase the
number of shares issuable thereunder and none of the terms or conditions of any such Convertible Securities (other than options
to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are otherwise materially
changed in any manner that adversely affects any of the Holders; and (iii) the shares of Common Stock issuable upon conversion
of the Preferred Shares and Warrants.


 




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(m)          “Fundamental
Transaction” “ means that (i) the Company or any of its Subsidiaries shall, directly or indirectly, in one or more
related transactions, (1) consolidate or merge with or into (whether or not the Company or any of its Subsidiaries is the surviving
corporation) any other Person, or (2) sell, lease, license, assign, transfer, convey or otherwise dispose of all or substantially
all of its respective properties or assets to any other Person, or (3) allow any other Person to make a purchase, tender or exchange
offer that is accepted by the holders of more than 50% of the outstanding shares of Voting Stock of the Company (not including
any shares of Voting Stock of the Company held by the Person or Persons making or party to, or associated or affiliated with the
Persons making or party to, such purchase, tender or exchange offer), or (4) consummate a stock or share purchase agreement or
other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement)
with any other Person whereby such other Person acquires more than 50% of the outstanding shares of Voting Stock of the Company
(not including any shares of Voting Stock of the Company held by the other Person or other Persons making or party to, or associated
or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination),
or (5) reorganize, recapitalize or reclassify the Common Stock, or (ii) any “person” or “group” (as these
terms are used for purposes of Sections 13(d) and 14(d) of the 1934 Act and the rules and regulations promulgated thereunder) is
or shall become the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of 50%
of the aggregate ordinary voting power represented by issued and outstanding Voting Stock of the Company.


 


(n)          
“Holder Pro Rata Amount” means, with respect to any Holder, a fraction (i) the numerator of which is the
number of Preferred Shares issued to such Holder pursuant to the Subscription Agreement on the Initial Issuance Date and (ii) the
denominator of which is the number of Preferred Shares issued to all Holders pursuant to the Subscription Agreement on the Initial
Issuance Date.


 


(o)          “Liquidation
Event” means, whether in a single transaction or series of transactions, the voluntary or involuntary liquidation, dissolution
or winding up of the Company or such Subsidiaries the assets of which constitute all or substantially all of the assets of the
business of the Company and its Subsidiaries, taken as a whole.


 




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


 


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


 


(r)          
“Permitted Indebtedness” means Indebtedness described in Schedule 4(o) of the Subscription Agreement as
in effect as of the Initial Issuance Date; provided, that the principal amount of such Indebtedness is not increased,
the terms of such Indebtedness are not modified to impose more burdensome terms upon the Company or any of its Subsidiaries and
the terms of such Indebtedness are not materially changed in any manner that adversely affects any Holder.


 


(s)          “Permitted
Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings
for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising in the ordinary course
of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation
of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business
with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings,
(iv) leases or subleases and licenses and sublicenses granted to others in the ordinary course of the Company’s business,
not interfering in any material respect with the business of the Company and its Subsidiaries taken as a whole and (v) 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.


 


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


 


(u)          
“Principal Market” means The NASDAQ Capital Market.


 


(v)         
“SEC” means the Securities and Exchange Commission or the successor thereto.


 


(w)          “Securities”
means, collectively, the Preferred Shares and the shares of Common Stock issuable upon conversion of (or otherwise in accordance
with) the Preferred Shares.


 


(x)          “Stated
Value” shall mean $0.68 per share, subject to adjustment for stock splits, stock dividends, recapitalizations, reorganizations,
reclassifications, combinations, subdivisions or other similar events occurring after the Initial Issuance Date with respect to
the Preferred Shares.


 




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(y)          “Subscription
Agreement” means that certain Subscription Agreement by and among the Company and the initial holders of Preferred Shares,
dated as of the Subscription Date, as may be amended from time in accordance with the terms thereof.


 


(z)          “Subscription
Date” means the Closing Date (as defined in the Subscription Agreement).


 


(aa)         “Subsidiaries”
shall have the meaning as set forth in the Subscription Agreement.


 


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


 


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


 


(dd)         “Transaction
Documents” shall have the meaning ascribed to it in the Subscription Agreement.


 


(bb)         
“Unpaid Dividend Amount” means, as of the applicable date of determination, with respect to each Preferred Share,
all accrued and unpaid Dividends on such Preferred Share.


 


(ff)         
“Voting Stock” of a Person means capital stock of such Person of the class or classes pursuant to which the
holders thereof have the general voting power to elect, or the general power to appoint, at least a majority of the board of directors,
managers, trustees or other similar governing body of such Person (irrespective of whether or not at the time capital stock of
any other class or classes shall have or might have voting power by reason of the happening of any contingency).


 




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(gg)         “VWAP”
means, for any security as of any date, the dollar volume-weighted average price for such security on the Principal Market (or,
if the Principal Market is not the principal trading market for such security, then on 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 Bloomberg through its “HP” function set to “weighted average” or, if
the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic
bulletin board for such security during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such
hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security
as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the VWAP cannot be calculated
for such security on such date on any of the foregoing bases, the VWAP of such security on such date shall be the fair market value
as mutually determined by the Company and such Holder. If the Company and such 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 22. All such determinations
shall be appropriately adjusted for any stock dividend, stock split, stock combination or other similar transaction during such
period.


 


24.         Disclosure.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Certificate of Designations, unless
the Company has in good faith determined that the matters relating to such notice do not constitute material, non-public information
relating to the Company or any of its Subsidiaries, the Company shall simultaneously with any such receipt or delivery publicly
disclose such material, non-public information on a Current Report on Form 8-K or otherwise. In the event that the Company believes
that a notice contains material, non-public information relating to the Company or any of its Subsidiaries, the Company so shall
indicate to each Holder contemporaneously with delivery of such notice, and in the absence of any such indication, each Holder
shall be allowed to presume that all matters relating to such notice do not constitute material, non-public information relating
to the Company or its Subsidiaries. Nothing contained in this Section 24 shall limit any obligations of the Company, or any rights
of any Holder, under the Subscription Agreement.


 


* * * * *


 




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IN WITNESS
WHEREOF, the Corporation has caused this Certificate of Designations of 0% Series A Convertible Preferred Stock of Majesco
Entertainment Company to be signed by its Chief Executive Officer on this 17th day of December, 2014.


 





	 	MAJESCO ENTERTAINMENT COMPANY  
	 	 	 	 
	 	By:  	/s/ Jesse Sutton  
	 	 	Name:  	Jesse Sutton  
	 	 	Title:  	Chief Executive Officer  







 




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EXHIBIT I


 


MAJESCO ENTERTAINMENT COMPANY


CONVERSION NOTICE


 


Reference is made to
the Certificate of Designations, Preferences and Rights of the Series A Convertible Preferred Stock of Majesco Entertainment Company
(the “Certificate of Designations”). In accordance with and pursuant to the Certificate of Designations, the
undersigned hereby elects to convert the number of shares of Series A Convertible Preferred Stock, $0.001 par value per share (the
“Preferred Shares”), of Majesco Entertainment Company, a Delaware corporation (the “Company”),
indicated below into shares of common stock, $0.001 par value per share (the “Common Stock”), of the Company,
as of the date specified below.


 


Date of Conversion:_________________________________________________________________________


 


Number of Preferred Shares to be converted:______________________________________________________


 


Share certificate no(s). of Preferred Shares
to be converted:__________________________________________


 


Tax ID Number (If applicable): ________________________________________________________________


 


Conversion Price:____________________________________________________________


 


Number of shares of Common Stock to be
issued:__________________________________________________


 


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


 


Issue to:___________________________________________






               ___________________________________________


 


Address: _________________________________________


 


Telephone Number: ________________________________


 


Facsimile Number:____________________________________


 


Holder:_____________________________________________


 


By:______________________________________


 


Title:_____________________________________


 


Dated:____________________________________


 


Account Number (if electronic book entry
transfer):________________________________________________


 


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


 




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EXHIBIT II


 


ACKNOWLEDGMENT


 


The Company hereby
acknowledges this Conversion Notice and hereby directs __________________ to issue the above indicated number of shares of Common
Stock in accordance with the Irrevocable Transfer Agent Instructions dated __________, 2014 from the Company and acknowledged and
agreed to by _______________.


 


	 	MAJESCO ENTERTAINMENT COMPANY
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title: