Document:

[FORM OF SECURED CONVERTIBLE NOTE]

 

NEITHER THE
ISSUANCE NOR THE SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY),
IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR
ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.  NOTWITHSTANDING THE FOREGOING,
THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.  

 

ANY TRANSFEREE OF THIS NOTE
SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE, INCLUDING SECTIONS 4(c)(ii) AND 16(a) HEREOF.  THE PRINCIPAL AMOUNT
REPRESENTED BY THIS NOTE AND, ACCORDINGLY, THE SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS THAN THE AMOUNTS SET
FORTH ON THE FACE HEREOF PURSUANT TO SECTION 4(c)(ii) OF THIS NOTE.

 

[THIS NOTE IS ISSUED WITH ORIGINAL ISSUE
DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE.]

 

BOLDFACE GROUP, INC.

12% SECURED CONVERTIBLE NOTE

 

	Issuance Date: December 21, 2012	Original Principal Amount: U.S. $[__________]

 

FOR
VALUE RECEIVED, BOLDFACE Group, Inc., a Nevada corporation (the “Company”), hereby promises to pay to the
order of [____________________] or its registered assigns (“Holder”)
the amount set out above as the Original Principal Amount (as reduced pursuant to the terms hereof pursuant to redemption, conversion
or otherwise, the “Principal”) when due, whether upon the Maturity Date, acceleration,
redemption or otherwise (in each case in accordance with the terms hereof) and to pay interest (“Interest”)
on any outstanding Principal at a rate per annum equal to the Interest Rate (as defined below), from the date set out above as
the Issuance Date (the “Issuance Date”) until the same becomes due and payable, whether upon an Interest Date
(as defined below), or the Maturity Date, acceleration, conversion, redemption or otherwise (in each case in accordance with the
terms hereof).  This Secured Convertible Note (including all Secured Convertible Notes issued in exchange, transfer or replacement
hereof, this “Note”) issued pursuant to the Securities Purchase Agreement (as defined below). 

 

    	 

    	 

    

 

1.          DEFINITIONS.
 For purposes of this Note, the following terms shall have the following meanings. Capitalized terms used and not otherwise
defined herein that are defined in the Securities Purchase Agreement shall have the meanings given such terms in the Securities
Purchase Agreement.

 

(a)          “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.

 

(b)          “Calendar
Month” means the period beginning on and including the first of each calendar month and ending on and including the last
day of such calendar month.

 

(c)          “Convertible
Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable
or exchangeable for Common Stock.

 

(d)          “Eligible
Market” means The New York Stock Exchange, the NYSE Amex, the Nasdaq Global Select
Market, the Nasdaq Global Market, the Nasdaq Capital Market or the Principal Market.

 

(e)          “Fundamental
Transaction” means that (i) the Company, directly or indirectly, in one or more related transactions effects any merger
or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease,
license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of
related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or
another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for
other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the
Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization
of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged
for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates
a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than
50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons
making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement
or other business combination).

 

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

 

(p)          
“Interest Rate” means twelve percent (12%) per annum, subject to periodic adjustment pursuant to Section 3.

 

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(s)          “Maturity
Date” shall mean August 21, 2013; provided, however, the Maturity Date may be extended at the mutual agreement in
writing of the Holder and the Company.

 

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

 

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

 

(v)          “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.

 

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

 

(x)          “Principal
Market” means the OTC Bulletin Board.

 

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

 

(z)          “Securities
Purchase Agreement” means that certain Securities Purchase Agreement, dated as of the date hereof, by and among the Company
and the initial holder of the Note, pursuant to which the Company issued the Note, as may be amended from time to time.

 

(aa)         “Successor
Entity” means the Person, which may be the Company, formed by, resulting from or surviving any Fundamental Transaction
or the Person with which such Fundamental Transaction shall have been made, provided that if such Person is not a publicly traded
entity whose common stock or equivalent equity security is quoted or listed for trading on an Eligible Market, Successor Entity
shall mean such Person’s Parent Entity.

 

2.          
PRINCIPAL; PREPAYMENT.  For value received, the Company hereby promises to pay to the order of the Holder, in lawful
money of the United States of America and in immediately available funds the Principal on the Maturity Date. Subject to Section
4(f), the Company at any time may prepay any portion of the outstanding Principal, accrued
and unpaid Interest or accrued and unpaid Late Charges on Principal and Interest, if any.
The Company acknowledges that the Principal of this Note exceeds the Purchase Price (after taking into account the OID) and that
such OID will be fully earned and charged to the Company as of the Issuance Date and paid to the Holder as part of the Principal
as set forth in this Note.

 

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3.          INTEREST;
INTEREST RATE.

 

(a)          Interest
on this Note shall commence accruing on the Issuance Date and shall be computed on the basis of a 360-day year and actual days
elapsed and shall be payable in arrears on the Maturity Date (the “Interest Date”).  Interest shall be
payable on the Interest Date, to the record holder of this Note on the Interest Date, in cash.

 

(b)          From
and after the occurrence of an Event of Default, the Interest Rate shall be increased to fourteen percent (14%).  In the event
that such Event of Default is subsequently cured, the adjustment referred to in the preceding sentence shall cease to be effective
as of the date of such cure; provided that the Interest as calculated at such increased rate during the continuance of such Event
of Default shall continue to apply to the extent relating to the days after the occurrence of such Event of Default through and
including the date of cure of such Event of Default.  

 

4.          CONVERSION
OF NOTES. This Note shall be convertible into shares of Common Stock on the terms and conditions set forth in this Section
4.

 

(a)          Conversion
Right.  Subject to the provisions of Section 4(e), at any time or times on or after the Issuance Date, the Holder
shall be entitled to convert any portion of the outstanding and unpaid Conversion Amount (as defined below) into validly
issued, fully paid and non-assessable shares of Common Stock in
accordance with Section 4(c), at the Conversion Rate (as defined below).  The Company shall not issue any fraction of a
share of Common Stock upon any conversion.  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.  The
Company shall pay any and all transfer, stamp, issuance and similar taxes that may be payable with respect to the issuance
and delivery of Common Stock upon conversion of any Conversion Amount.

 

(b)          Conversion
Rate.  The number of shares of Common Stock issuable upon conversion of any Conversion Amount pursuant to Section 4(a) shall be determined by dividing (x) such Conversion Amount by (y) the Conversion Price (the “Conversion
Rate”).

 

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

 

(ii)         “Conversion
Price” means, as of any Conversion Date (as defined below) or other date of determination, $0.25, subject to adjustment
as provided herein.

 

(c)          Right
to Reset the Conversion Price. If the closing price of the Common Stock is less than $0.30 on the earlier of (the “Reset
Date”) (i) Maturity Date or (ii) the date of the completion of a subsequent financing in which the Company raises at
least $5,000,000 in gross proceeds (the “Subsequent Offering”), the Holder shall have a one-time right to reset
the Conversion Price on the Reset Date (the “Reset Right”). If the Holder exercises its Reset Right, (x) with
respect to clause (i) above, the Conversion Price shall equal to 70% of the VWAP for the five (5) consecutive Trading Days immediately
preceding the Reset Date, as proportionately adjusted to reflect any stock splits, stock dividends, combination of shares or like
events, or (y) with respect to clause (ii) above, the Conversion Price shall equal to 70% of the VWAP for the five (5) consecutive
Trading Days immediately after the Reset Date, as proportionately adjusted to reflect any stock splits, stock dividends, combination
of shares or like events.

 

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(d)          Mechanics
of Conversion.

 

(i)          Optional
Conversion.  To convert any Conversion Amount into shares of Common Stock on any date (a “Conversion Date”),
the Holder shall (A) transmit by facsimile (or otherwise deliver), for receipt on or prior to 5:00 p.m., New York Time, on such
date, a copy of an executed notice of conversion in the form attached hereto as Exhibit I (the “Conversion Notice”)
to the Company and (B) if required hereunder, surrender this Note to a nationally recognized overnight delivery service for delivery
to the Company (or an indemnification undertaking with respect to this Note in the case of its loss, theft or destruction). On
or before the next Trading Day following the date of receipt of a Conversion Notice, the Company shall transmit by facsimile a
confirmation of receipt of such Conversion Notice to the Holder and the Transfer Agent.  On or before the fifth (5th)
Trading Day following the date of receipt of a Conversion Notice (the “Share Delivery Date”), the Company shall
(1) cause the Transfer Agent to (X) provided that the Transfer Agent is participating in the Fast Automated Securities Transfer
Program of DTC credit such aggregate number of shares of Common Stock to which the Holder shall be entitled to the Holder’s
or its designee’s balance account with DTC through its Deposit Withdrawal Agent Commission system or (Y) if the Transfer
Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and deliver to the address as specified
in the Conversion Notice, a certificate, registered in the name of the Holder or its designee, for the number of shares of Common
Stock to which the Holder shall be entitled, and (2) pay to the Holder in cash an amount equal to the accrued and unpaid Interest
on the Conversion Amount up to and including the Conversion Date.  If this Note is physically surrendered for conversion as
required hereunder and the outstanding Principal of this Note is greater than the Principal portion of the Conversion Amount being
converted, then the Company shall as soon as practicable and in no event later than five (5) Business Days after receipt of this
Note and at its own expense, issue and deliver to the Holder (or its designee) a new Note (in
accordance with Section 16(d)) representing the outstanding Principal not converted.  The Person or Persons entitled to receive
the shares of Common Stock issuable upon a conversion of this Note shall be treated for all purposes as the record holder or holders
of such shares of Common Stock on the Conversion Date.  

 

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(ii)         Registration;
Book-Entry. The Company shall maintain a register (the “Register”) for the recordation of the
names and addresses of the holders of each Note and the principal amount of the Notes held by such holders (the
“Registered Notes”). The entries in the Register shall be conclusive and binding for all purposes absent
manifest error. The Company and the holders of the Notes shall treat each Person whose name is recorded in the Register as
the owner of a Note for all purposes, including, without limitation, the right to receive payments of principal and interest
hereunder, notwithstanding notice to the contrary. A Registered Note may be assigned or sold in whole or in part only by
registration of such assignment or sale on the Register. Upon its receipt of a request to assign or sell all or part of any
Registered Note by a Holder, the Company shall record the information contained therein in the Register and issue one or more
new Registered Notes in the same aggregate principal amount as the principal amount of the surrendered Registered Note to the
designated assignee or transferee pursuant to Section 15. Notwithstanding anything to the
contrary set forth herein, upon conversion of any portion of this Note in accordance with the terms hereof, the Holder shall
not be required to physically surrender this Note to the Company unless (A) the full Conversion Amount represented by this
Note is being converted or (B) the Holder has provided the Company with prior written notice (which notice may be included in
a Conversion Notice) requesting physical surrender and reissue of this Note.  The Holder and the Company shall
maintain records showing the Principal, Interest and Late Charges converted and the dates of such conversions or shall use
such other method, reasonably satisfactory to the Holder and the Company, so as not to require physical surrender of this
Note upon conversion.

 

(iii)        Disputes.
 In the event of a dispute as to the number of shares of Common Stock issuable to the Holder in connection with a conversion
of this Note, the Company shall issue to the Holder the number of shares of Common Stock not in dispute and resolve such dispute
in accordance with Section 21.

 

(e)          Limitations
on Conversions.  The Company shall not effect any conversion of this Note, and a Holder shall not have the right to
convert any portion of this Note, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after conversion as set forth on the applicable Conversion Notice, the Holder (together with the Holder’s Affiliates,
and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially
own in excess of the Beneficial Ownership Limitation (as defined below).  For purposes of the foregoing sentence, the
number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number of shares of
Common Stock issuable upon conversion of this Note with respect to which such determination is being made, but shall exclude
the number of shares of Common Stock which would be issuable upon (i) conversion of the remaining, unconverted portion of
this Note beneficially owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the unexercised or
unconverted portion of any other securities of the Company (including, without limitation, any other Common Stock
Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially
owned by the Holder or any of its Affiliates.  Except as set forth in the preceding sentence, for purposes of this
Section 4(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and
regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder
that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any
schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section
4(e) applies, the determination of whether this Note is exercisable (in relation to other securities owned by the Holder
together with any Affiliates) and of which portion of this Note is exercisable shall be in the sole discretion of the Holder,
and the submission of a Conversion Notice shall be deemed to be the Holder’s determination of whether this Note is
exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this
Note is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to
verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated
above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 4(e), in determining the number of outstanding shares of Common Stock, a Holder may
rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or
annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a
more recent written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock
outstanding.  Upon the written or oral request of a Holder, the Company shall within two Trading Days confirm orally and
in writing to the Holder the number of shares of Common Stock then outstanding.  In any case, the number of outstanding
shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company,
including this Note, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common
Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the
Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon conversion
of this Note. The Holder, upon not less than 61 days’ prior notice to the Company, may increase or decrease
the Beneficial Ownership Limitation provisions of this Section 4(e), provided that the Beneficial Ownership Limitation in no
event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance
of shares of Common Stock upon conversion of this Note held by the Holder and the provisions of this Section 4(e) shall
continue to apply. Any such increase or decrease will not be effective until the 61st day after such notice is
delivered to the Company. 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. The limitations contained in this paragraph
shall apply to a successor holder of this Note.

 

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(f)          In
the event the Company elects to repay all or a part of the Principal and any accrued but unpaid Interest thereon in cash or out
of the proceeds from a Subsequent Offering, the Company shall provide written notice to the Holder of such election to repay, and
the Holder shall have the right to convert all or a part of the Note (as provided herein) within five (5) days from the date of
such notice. The Company shall not repay any of the Principal or any accrued but unpaid Interest thereon during such five-day period.

 

5.           RIGHTS
UPON EVENT OF DEFAULT.

 

(a)          Event
of Default.  Each of the following events shall constitute an “Event of Default”:

 

(i)          the
Company’s failure to cure a Conversion Failure or a Delivery Failure (as defined in the Warrants) by
delivery of the required number of shares of Common Stock within ten (10) Trading Days after
the applicable Conversion Date or exercise date (as the case may be);

 

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(ii)         the
Company’s failure to pay to the Holder any amount of Principal (including, without limitation, any redemption payment), Interest,
Late Charges or other material amounts when and as due under this Note or any other Transaction Document (as defined in the Securities
Purchase Agreement) or any other agreement, document, certificate or other instrument delivered in connection with the transactions
contemplated hereby and thereby to which the Holder is a party, except, in the case of a failure to pay Interest and Late Charges
when and as due, in which case only if such failure remains uncured for a period of at least
fifteen (15) days;

 

(iii)        the
Company, pursuant to or within the meaning of Title 11, U.S. Code, or any similar Federal, foreign or state law for the relief
of debtors (collectively, “Bankruptcy Law”), (A) commences a voluntary case, (B) consents to the entry of an
order for relief against it in an involuntary case, (C) consents to the appointment of a receiver, trustee, assignee, liquidator
or similar official (a “Custodian”), (D) makes a general assignment for the benefit of its creditors or (E)
admits in writing that it is generally unable to pay its debts as they become due;

 

(iv)         any
case, proceeding or other action shall be commenced against the Company for the purpose of effecting, or an order, judgment or
decree shall be entered by any court of competent jurisdiction approving (in whole or in part) anything specified in Section 5(a)(iii)
hereof, or any receiver, trustee, assignee, custodian, sequestrator, liquidator or other official shall be appointed with respect
to the Company, or shall be appointed to take or shall otherwise acquire possession or control of all or a substantial part of
the assets and properties of the Company, and any of the foregoing shall continue unstayed and in effect for any period of sixty
(60) days;

 

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

 

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

 

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(vii)        other
than as specifically set forth in another clause of this Section 5(a), the Company or any Subsidiary breaches any material representation,
warranty or covenant of any Transaction Document (including, without limitation, the Security Documents and the Guaranties), except,
in the case of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured after the
cure period;

 

(viii)      any
Material Adverse Effect occurs;

 

(ix)         any
material provision of any Transaction Document (including, without limitation, the
Security Documents and the Guaranties) shall at any time for any reason (other than pursuant to the express terms thereof)
cease to be, in a material way, valid and binding on or enforceable against the parties thereto,
or the validity or enforceability thereof shall be contested by any party thereto, or a proceeding shall be commenced by the Company
or any Subsidiary or any governmental authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability
thereof;

 

(x)          the
Security Documents shall for any reason fail or cease to create a separate valid and perfected and, except to the extent permitted
by the terms hereof or thereof, first priority Lien on the Collateral (as defined in the Security Agreement) in favor of each of
the Secured Parties (as defined in the Security Agreement);

 

(xi)         any
material damage to, or loss, theft or destruction of, any Collateral, whether or not insured, or any strike, lockout, labor dispute,
embargo, condemnation, act of God or public enemy, or other casualty which causes, for more than thirty (30) consecutive days,
the cessation or substantial curtailment of revenue producing activities at any facility of the Company or any Subsidiary, if any
such event or circumstance could have a Material Adverse Effect;

 

(xii)        the
Company will promptly (but in any event, within 2 Business Days) notify the Collateral Agent (as defined in the Security Agreement)
in writing of the occurrence of any Event of Default, and the failure to so promptly notify the Collateral Agent shall itself be
an Event of Default.

 

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

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(b)          Rights
Upon Event of Default.  If any Event of Default specified in clauses 5(a)(iii) or (iv) occurs, then the full principal
amount of this Note, together with any other amounts owing in respect thereof, to the date of the Event of Default, shall become
immediately due and payable without any action on the part of the Holder, and if any other Event of Default occurs, the full principal
amount of this Note, together with any other amounts owing in respect thereof, to the date of acceleration shall become, at the
Holder’s election, immediately due and payable in cash. Commencing five (5) business days after the occurrence of any
Event of Default that results in the eventual acceleration of this Note, interest on this Note shall begin to accrue at the rate
of interest specified in Section 1.01(b) PLUS two (2%) percent per annum, or such lower maximum amount of interest permitted
to be charged under applicable law. All Notes for which the full amount hereunder shall have been paid in accordance herewith shall
promptly be surrendered to or as directed by the Company. The Holder need not provide, and the Company hereby waives, any presentment,
demand, protest or other notice of any kind, and the Holder may immediately and without expiration of any grace period enforce
any and all of its rights and remedies hereunder and all other remedies available to it under applicable law. Such declaration
may be rescinded and annulled by the Holder at any time prior to payment hereunder and the Holder shall have all rights as a Note
holder until such time, if any, as the full payment under this Section shall have been received by it. No such rescission or annulment
shall affect any subsequent Event of Default or impair any right consequent thereon.

 

6.          RIGHTS
UPON FUNDAMENTAL TRANSACTION AND CHANGE OF CONTROL. The Company shall not enter into or be party to a Fundamental
Transaction unless (i)  the Successor Entity assumes in writing all of the obligations of the Company under this Note
and the other Transaction Documents in accordance with the provisions of this Section 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 Notes in exchange for such Notes a security of the Successor
Entity evidenced by a written instrument substantially similar in form and substance to the Notes, including, without
limitation, having a principal amount and interest rate equal to the principal amounts then
outstanding and the interest rates of the Notes held by such holder, having similar conversion
rights as the Notes and having similar ranking to the Notes, and satisfactory to the Required Holders and (ii) the
Successor Entity (including its Parent Entity) is a publicly traded corporation whose common stock is quoted on or listed for
trading on an Eligible Market.  Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed
to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and
the other Transaction Documents referring to the “Company” shall refer instead to the
Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the
Company under this Note and the other Transaction Documents with the same effect as if such
Successor Entity had been named as the Company herein.  Upon consummation of the Fundamental Transaction, the Successor
Entity shall deliver to the Holder confirmation that there shall be issued upon conversion or redemption of this Note at any
time after the consummation of the 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 7 and 16, which shall continue to be
receivable thereafter) issuable upon the conversion or redemption of
the Notes prior to such Fundamental Transaction, such shares of publicly traded common stock (or their equivalent) of the
Successor Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening
of such Fundamental Transaction had this Note been converted immediately prior to such Fundamental Transaction (without
regard to any limitations on the conversion of this Note), as adjusted in accordance with the
provisions of this Note.  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 this Note.

 

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

 

(a)          Purchase
Rights.  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 the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate
Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon
complete conversion of this Note (without taking into account any limitations or restrictions on the convertibility of this Note)
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 the Holder’s right to participate in any such Purchase Right
would result in the Holder exceeding the Beneficial Ownership Limitation, then the 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 the Holder until such time, if ever, as its
right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

(b)          Other
Corporate Events.  In addition to and not in substitution for any other rights hereunder, prior to the consummation of
any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other assets
with respect to or in exchange for shares of Common Stock (a “Corporate Event”), the Company shall make appropriate
provision to insure that the Holder will thereafter have the right to receive upon a conversion of this Note, at the Holder’s
option, (i) in addition to the shares of Common Stock receivable upon such conversion, such securities or other assets to which
the Holder would have been entitled with respect to such shares of Common Stock had such shares of Common Stock been held by the
Holder upon the consummation of such Corporate Event (without taking into account any limitations or restrictions on the convertibility
of this Note) or (ii) in lieu of the shares of Common Stock otherwise receivable upon such conversion, such securities or other
assets received by the holders of shares of Common Stock in connection with the consummation of such Corporate Event in such amounts
as the Holder would have been entitled to receive had this Note initially been issued with conversion rights for the form of such
consideration (as opposed to shares of Common Stock) at a conversion rate for such consideration commensurate with the Conversion
Rate.  Provision made pursuant to the preceding sentence shall be in a form and substance satisfactory to the Required Holders.
 The provisions of this Section 7 shall apply similarly and equally to successive Corporate Events and shall be applied without
regard to any limitations on the conversion or redemption of this Note.

 

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8.          CERTAIN
ADJUSTMENTS.

 

(a)          Stock
Dividends and Splits. If the Company, at any time while this Note is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities
payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the
Company upon conversion of this Note), (ii) subdivides outstanding shares of Common Stock into a larger number of shares,
(iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares
or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each
case the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common
Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the
number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon conversion
of this Note shall be proportionately adjusted such that the aggregate Conversion Price of this Note shall remain unchanged.
Any adjustment made pursuant to this Section 8(a) shall become effective immediately after the record date for the
determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after
the effective date in the case of a subdivision, combination or re-classification.

 

(b)          Subsequent
Equity Sales.

 

(i)          If
the Company or any Subsidiary thereof, as applicable, at any time while this Note is outstanding, shall sell or grant any option
to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any
option to purchase or other disposition) any Common Stock or Common Stock Equivalents, at an effective price per share less than
the Conversion Price then in effect (such lower price, the “New Issuance Price” and such issuances collectively,
a “Dilutive Issuance”) (it being understood and agreed that if the holder of the Common Stock or Common Stock
Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion,
exercise or exchange prices or otherwise, or due to Notes, options or rights per share which are issued in connection with such
issuance, be entitled to receive shares of Common Stock at an effective price per share that is less than the Conversion Price,
such issuance shall be deemed to have occurred for less than the Conversion Price on such date of the Dilutive Issuance at such
effective price), then simultaneously with the consummation of each Dilutive Issuance the Conversion Price shall be reduced and
only reduced by multiplying the Conversion Price by a fraction, the numerator of which is the number of shares of Common Stock
issued and outstanding immediately prior to the Dilutive Issuance plus the number of shares of Common Stock which the offering
price for such Dilutive Issuance would purchase at the then Conversion Price, and the denominator of which shall be the sum of
the number of shares of Common Stock issued and outstanding immediately prior to the Dilutive Issuance plus the number of shares
of Common Stock so issued or issuable in connection with the Dilutive Issuance (the “Adjusted Price”) (subject to
adjustment for stock splits, reverse splits and similar capital adjustments). Such adjustment shall be made whenever such Common
Stock or Common Stock Equivalents are issued. Notwithstanding the foregoing, no adjustments shall be made, paid or issued under
this Section 8(b) in respect of an Exempt Issuance.

 

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(ii)         The
Company shall promptly notify the Holder, in writing, following the issuance or deemed issuance of any Common Stock or Common
Stock Equivalents subject to this Section 8(b), indicating therein the applicable issuance price, or applicable reset price, exchange
price, conversion price and other pricing terms (such notice, the “Dilutive Issuance Notice”). For purposes
of clarification, whether or not the Company provides a Dilutive Issuance Notice pursuant to this Section 8(b), upon the occurrence
of any Dilutive Issuance, the Holder is entitled to convert the Note at the Adjusted Price regardless of whether the Holder accurately
refers to the Adjusted Price in the Conversion Notice.

 

(iii)        For
clarity, no adjustment of the number of Conversion Shares shall be made upon any adjustment of the Conversion Price pursuant to
this Section 8(b).

 

(iv)         If
the purchase or exercise price provided for in any Common Stock Equivalents, or the rate at which any Common Stock
Equivalents 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 Common Stock Equivalents 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 8(b)(iv), if the terms of any Common Stock Equivalents that was outstanding as
of the date of issuance of this Note are increased or decreased in the manner described in the immediately preceding
sentence, then such Common Stock Equivalents 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. 

 

(v)          No
adjustment pursuant to this Section 8(b) shall be made if such adjustment would result in an increase of the Conversion Price
then in effect.

 

(c)          Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 8(a) above, if at any
time the Company grants, issues or sells any Common Stock Equivalents or rights to purchase stock, Notes, securities or other
property pro rata to the record holders of any class of shares of Common Stock (the “Purchase Rights”), then
the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which
the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete conversion
of this Note (without regard to any limitations on conversion hereof, including without limitation, the Beneficial Ownership Limitation)
immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such
record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or
sale of such Purchase Rights (provided, however, to the extent that the Holder’s right to participate in any such Purchase
Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the 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 the Holder until such time, if ever, as its
right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

    	13

    	 

    

 

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

 

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(e)          Fundamental
Transaction. If, at any time while this Note is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group
acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person
or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share
purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent
conversion of this Note, the Holder shall have the right to receive, for each Conversion Share that would have been issuable upon
such conversion immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard
to any limitation in Section 4(e) on the conversion of this Note), the number of shares of Common Stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Note
is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 4(e) on the conversion
of this Note). For purposes of any such conversion, the determination of the Conversion Price shall be appropriately adjusted
to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the Conversion Price among the Alternate Consideration
in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of
Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the
Holder shall be given the same choice as to the Alternate Consideration it receives upon any conversion of this Note following
such Fundamental Transaction. Notwithstanding anything to the contrary, in the event of a Fundamental Transaction that is (1)
an all cash transaction, (2) a “Rule 13e-3 transaction” as defined in Rule 13e-3 under the Exchange Act, or (3) a
Fundamental Transaction involving a person or entity not traded on a national securities exchange, the Company or any Successor
Entity (as defined below) shall, at the Holder’s option, exercisable at any time concurrently with, or within 30 days after,
the consummation of the Fundamental Transaction, purchase this Note from the Holder by paying to the
Holder an amount of cash equal to the Black Scholes Value of the remaining unconverted portion of this Note on the date
of the consummation of such Fundamental Transaction. The Company shall cause any Successor Entity to assume in writing all of
the obligations of the Company under this Note and the other Transaction Documents in accordance with the provisions of this Section
8(f) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without
unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange
for this Note a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance
to this Note which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent
entity) equivalent to the shares of Common Stock acquirable and receivable upon conversion of this Note (without regard to any
limitations on the conversion of this Note) prior to such Fundamental Transaction, and with an conversion price which applies
the conversion price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common
Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital
stock and such conversion price being for the purpose of protecting the economic value of this Note immediately prior to the consummation
of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence
of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the
date of such Fundamental Transaction, the provisions of this Note and the other Transaction Documents referring to the “Company”
shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the
obligations of the Company under this Note and the other Transaction Documents with the same effect as if such Successor Entity
had been named as the Company herein.

 

(f)          Calculations.
All calculations under this Section 8 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 8, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall
be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

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(g)          Notice
to Holder.

 

(i)          Adjustment
to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 8, the Company shall
promptly mail to the Holder a notice setting forth the Conversion Price after such adjustment and any resulting adjustment to
the number of Conversion Shares and setting forth a brief statement of the facts requiring such adjustment.

 

(ii)         Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C)
the Company shall authorize the granting to all holders of the Common Stock rights or Notes to subscribe for or purchase any shares
of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection
with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer
of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation
or winding up of the affairs of the Company, then, in each case, the Company shall cause to be mailed to the Holder at its last
address as it shall appear upon the Note Register (as defined below) of the Company, at least five (5) calendar days, or such longer
period as may be required by law, prior to the applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or Notes, or if a
record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or Notes are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer
or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common
Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to mail such notice
or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified
in such notice. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding
the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current
Report on Form 8-K. The Holder shall remain entitled to convert this Note during the period commencing on the date of such notice
to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

9.          [RESERVED].
 

 

10.        SECURITY.
This Note is secured to the extent and in the manner set forth in the Security Documents (as defined in the Securities Purchase
Agreement).

 

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11.         NONCIRCUMVENTION.
 The Company hereby covenants and agrees that the Company will not, by amendment of its Articles 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 Note,
and will at all times in good faith carry out all of the provisions of this Note and take all action as may be required
to protect the rights of the Holder of this Note. Without limiting the generality of the foregoing, the Company (i) shall
not increase the par value of any shares of Common Stock receivable upon conversion of this Note above the Conversion Price then
in effect, (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 nonassessable shares of Common Stock upon the conversion of this Note, and (iii) shall, so long as any of
the Notes 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 Notes, the maximum number of shares of Common Stock as
shall from time to time be necessary to effect the conversion of the Notes then outstanding (without regard to any limitations
on conversion).

 

12.         VOTING
RIGHTS.  The Holder shall have no voting rights as the holder of this Note, except as required by law, including but not
limited to Nevada Revised Statutes, and as expressly provided in this Note.

 

13.         COVENANTS.
 

 

(a)          Rank.
All payments due under this Note (a) shall rank pari passu with all other Notes and (b) shall
be senior to all other Indebtedness of the Company and its Subsidiaries, except for indebtedness with respect to the Permitted
Debt (as defined below).

 

(b)          Restriction
on Additional Indebtedness. So long as this Note shall remain in effect and until any outstanding principal and interest and
all fees and all other expenses or amounts payable under this Note have been paid in full, the Company shall not without the written
prior approval of the Required Holders: incur, create, assume, guaranty or permit to exist any indebtedness that ranks senior in
priority to, or pari passu with, the obligations under this Note and the Securities Purchase Agreement, except for (i) indebtedness
existing on the date hereof as provided under the Securities Purchase Agreement or disclosed in the SEC Reports (as defined in
the Securities Purchase Agreement), (ii) indebtedness that ranks senior in priority to or pari passu with the obligations under
this Note and the Purchase Agreement on the Original Issue Date, (iii) indebtedness created as a result of a subsequent financing
if the gross proceeds to the Company of such financing are equal to or greater than the aggregate principal amount of the outstanding
Notes and such Notes are repaid in full upon the closing of such financing, (iv) equipment lease financing created by the Company
or any Subsidiary in the ordinary course of business after the date hereof, where the sole collateral for such financing is the
equipment so leased, and (v) any factoring arrangements entered into by the Company and/or any of its Subsidiaries with any third-party
factor (the indebtedness in clauses (i) through (v) shall be collectively referred to as the “Permitted Debt”).

 

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

 

(d)          Restriction
on Transfer of Assets. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
sell, lease, license, assign, transfer, convey or otherwise dispose of any assets or rights
of the Company or any Subsidiary owned or hereafter acquired whether in a single transaction
or a series of related transactions, other than (i) sales, leases, licenses, assignments, transfers,
conveyances and other dispositions of such assets or rights by the Company and its Subsidiaries that, in the aggregate, do not
have a fair market value in excess of $250,000 in any twelve (12) month period, (ii) sales of inventory in the ordinary course
of business and (iii) repayments of any amount of Permitted Debt.

 

(e)          Maturity
of Indebtedness. Except for Permitted Debt, the Company shall not, and the Company shall cause each of its Subsidiaries to
not, directly or indirectly, permit any Indebtedness of the Company or any of the Subsidiaries
to mature or accelerate prior to the Maturity Date.

 

(f)          New
Subsidiaries. Simultaneously with the acquisition or formation of each material New Subsidiary, the Company shall cause such
New Subsidiary to execute, and deliver to each holder of Notes, all Security Documents (as defined in
the Securities Purchase Agreement) and Guaranties (as defined in the Securities Purchase Agreement) as requested by the
Holder.

 

(g)          Change
in Nature of Business. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or
indirectly, engage in any material line of business substantially different from those lines of business conducted by the Company
and each of its Subsidiaries on the Issuance Date or any business substantially related or incidental thereto. The Company shall
not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, modify its or their corporate structure
or purpose

 

(h)          Internal
Accounting Controls.  So long as this Note is outstanding, the Company and each of its Subsidiaries shall maintain, in
all material respects, a system of internal accounting controls consistent with the internal accounting controls described in Section
3(r) of the Securities Purchase Agreement).

 

14.         VOTE
TO ISSUE, OR CHANGE THE TERMS OF, NOTES.  The affirmative vote at a meeting duly called for such purpose or the written
consent without a meeting of the Required Holders shall be required for any change or amendment to this Note.

 

15.         TRANSFER.
This Note and any shares of Common Stock issued upon conversion of this Note may only be offered,
sold, assigned or transferred by the Holder without the consent of the Company, provided that the provisions of Section 4.2 of
the Securities Purchase Agreement are complied with in all respects.

 

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16.         REISSUANCE
OF THIS NOTE.

 

(a)          Transfer.
 If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will issue,
promptly following the satisfaction of the provisions of Section 4.2 of the Securities Purchase Agreement, and deliver upon the
order of the Holder a new Note (in accordance with Section 16(d)), in the name of the validly registered assigns or transferee,
representing the outstanding Principal being transferred by the Holder and, if less than the
entire outstanding Principal is being transferred, a new Note (in accordance with Section 16(d)) to the Holder representing the
outstanding Principal not being transferred.  The Holder and any assignee, by acceptance of this Note, acknowledge and agree
that, by reason of the provisions of Section 4(c)(ii) and this Section 16(a), following conversion or redemption of any
portion of this Note, the outstanding Principal represented by this Note may be less than the Principal stated on the face of
this Note.

 

(b)          Lost,
Stolen or Mutilated Note.  Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking
by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the
Company shall execute and deliver to the Holder a new Note (in accordance with Section 16(d)) representing the outstanding Principal.

 

(c)          Note
Exchangeable for Different Denominations.  This Note is exchangeable, upon the surrender hereof by the Holder at the principal
office of the Company, for a new Note or Notes (in accordance with Section (d) and in principal amounts of at least $100,000) representing
in the aggregate the outstanding Principal of this Note, and each such new Note will represent such portion of such outstanding
Principal as is designated by the Holder at the time of such surrender.

 

(d)          Issuance
of New Notes.  Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note
(i) shall be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining
outstanding (or in the case of a new Note being issued pursuant to Section 16(a) or Section 16(c), the Principal designated by
the Holder which, when added to the principal represented by the other new Notes issued in connection with such issuance, does
not exceed the Principal remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have
an issuance date, as indicated on the face of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have
the same rights and conditions as this Note, and (v) shall represent accrued Interest and Late Charges on the Principal and Interest
of this Note, from the Issuance Date.

 

(e)          Registered
Instrument. This Note is a registered instrument and is not a bearer instrument. The Note is registered as to both Principal
and Interest with the Company and its Transfer Agent and all payments hereunder shall be made to the named Holder or, in the event
of a transfer, to the transferee identified in the record of ownership of the Note maintained by the Holder on behalf of the Company
and the Transfer Agent. Transfer of this Note may not be effected except in accordance with the provisions of the Note and the
Securities Purchase Agreement.

 

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17.         REMEDIES,
CHARACTERIZATIONS, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF.  The remedies provided in this Note shall be cumulative
and in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity
(including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s
right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Note.  Amounts
set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the
amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of
the Company (or the performance thereof).  The Company acknowledges that a breach by it of its obligations hereunder will
cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate.  The Company therefore
agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled, in addition to all other available
remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other
security being required. The Company shall provide all information and documentation to the Holder that is requested by
the Holder to enable the Holder to confirm the Company’s compliance with the terms and conditions of this Note (including,
without limitation, compliance with Section 8).

 

18.         PAYMENT
OF COLLECTION, ENFORCEMENT AND OTHER COSTS.  If (a) this Note is placed in the hands of an attorney for collection or
enforcement or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due
under this Note or to enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the
Company or other proceedings affecting Company creditors’ rights and involving a claim under this Note, then the Company
shall pay the costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization,
receivership or other proceeding, including, but not limited to, attorneys’ fees and disbursements.

 

19.         CONSTRUCTION;
HEADINGS.  This Note shall be deemed to be jointly drafted by the Company and all the Purchasers and shall not be construed
against any person as the drafter hereof.  The headings of this Note are for convenience of reference and shall not form part
of, or affect the interpretation of, this Note.

 

20.         FAILURE
OR INDULGENCE NOT WAIVER.  No failure or delay on the part of the Holder in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege.

 

    	20

    	 

    

 

21.         DISPUTE
RESOLUTION.  In the case of a dispute as to the determination of the VWAP or the arithmetic calculation of the Conversion
Rate, the Company shall submit the disputed determinations or arithmetic calculations via facsimile within three (3) Business Days
of receipt of the Conversion Notice or other event giving rise to such dispute, as the case may be, to the Holder.  If the
Holder and the Company are unable to agree upon such determination or calculation within two (2) Business Day2 of such disputed
determination or arithmetic calculation being submitted to the Holder, then the Company shall, within two (2) Business Days submit
via facsimile (a) the disputed determination of the VWAP to an independent, reputable investment bank selected by the Company and
approved by the Holder  (such approval not to be unreasonably withheld or delayed) or (b) the disputed arithmetic calculation
of the Conversion Rate to the Company’s independent, outside accountant.  The Company, at the Company’s expense,
shall cause the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify
the Company and the Holder of the results no later than five (5) Business Days from the time it receives the disputed determinations
or calculations.  Such investment bank’s or accountant’s determination or calculation, as the case may be, shall
be binding upon all parties absent demonstrable error.

 

22.         NOTICES;
PAYMENTS.

 

(a)          Notices.
 Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in
accordance with Section 5.4 of the Securities Purchase Agreement.  The Company shall provide the Holder with prompt written
notice of all actions taken pursuant to this Note, including in reasonable detail a description of such action and the reason therefore.
 Without limiting the generality of the foregoing, the Company will give written notice to the Holder (i) immediately upon
any adjustment of the Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment
and (ii) at least ten  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 pro rata subscription offer to holders of Common Stock
or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each
case that such information shall be made known to the public prior to or in conjunction with such notice being provided to the
Holder.

 

(b)          Payments.
 Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, such payment shall be made
in lawful money of the United States of America by a check drawn on the account of the Company and sent via overnight courier service
to such Person at such address as previously provided to the Company in writing (which address, in the case of each of the Purchasers,
shall initially be as set forth on the Schedule of Purchasers attached to the Securities Purchase Agreement); provided that the
Holder may elect to receive a payment of cash via wire transfer of immediately available funds by providing the Company with prior
written notice setting out such request and the Holder’s wire transfer instructions.  Whenever any amount expressed
to be due by the terms of this Note is due on any day which is not a Business Day, the same shall instead be due on the next succeeding
day which is a Business Day and, in the case of any Interest Date which is not the date on which this Note is paid in full, the
extension of the due date thereof shall not be taken into account for purposes of determining the amount of Interest due on such
date.  Any amount of Principal or other amounts due under the Transaction Documents, other than Interest, which is not paid
when due shall result in a late charge being incurred and payable by the Company in an amount equal to interest on such amount
at the rate of fourteen percent (14%) per annum from the date such amount was due until the same is paid in full (“Late Charge”).

 

    	21

    	 

    

 

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

 

24.         CURRENCY.
All dollar amounts referred to in this Note are in United States Dollars (“U.S. Dollars”), and all amounts owing under
this Note shall be paid in U.S. Dollars.

 

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

 

26.         GOVERNING
LAW; JURISDICTION; JURY TRIAL.  This Note shall be construed and enforced in accordance with, and all questions concerning
the construction, validity, interpretation and performance of this Note shall be governed by, the internal laws of the State of
New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or
any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York.  The
Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York,
Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is improper.  The Company hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof
to such party at the address it set forth on the signature page hereto and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law.  In the event that any provision of this Note is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall
be deemed modified to conform with such statute or rule of law.  Any such provision which may prove invalid or unenforceable
under any law shall not affect the validity or enforceability of any other provision of this Note.  Nothing contained herein
shall be deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other
jurisdiction to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for
such obligations, or to enforce a judgment or other court ruling in favor of the Holder.   THE COMPANY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

    	22

    	 

    

 

27.         MAXIMUM
PAYMENTS. Nothing contained in this Note shall, or shall be deemed to, establish or require the payment of a rate of interest
or other charges in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid
or other charges under this Note exceeds the maximum permitted by such law, any payments in excess of such maximum shall be credited
against amounts owed by the Company to the Holder and thus refunded to the Company.

 

[Signature page follows]

 

    	23

    	 

    

 

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

 

	 	BOLDFACE GROUP, INC.
	 	 
	 	By:	 
	 	Name: Nicole Ostoya
	 	Title:   Chief Executive Officer and President

 

    	 

    	 

    

 

EXHIBIT I

BOLDFACE GROUP, INC.

CONVERSION NOTICE

 

Reference is made to
the 12% Secured Convertible Note (the “Note”) issued to the undersigned by BOLDFACE Group, Inc., a Nevada corporation
(the “Company”). In accordance with and pursuant to the Note, the undersigned hereby elects to convert the Conversion
Amount (as defined in the Note) of the Note indicated below into shares of common stock, $0.001 par value per share (the “Common
Stock”), of the Company, as of the date specified below.

 

	 	Date of Conversion:	 

 

	 	Aggregate Conversion Amount to be converted:	 

 

	 	Conversion Price:	 

 

	 	Number of shares of Common Stock to be issued:	 

 

	Please issue the Common Stock into which the Note is being converted in the following name and to the following address:

 

	 	Issue to:	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

	 	Facsimile Number:	 

 

	 	Holder:	 

 

	 	By:	 

 

	 	Title:	 

 

	Dated:	 

 

	 	Account Number:	 
	 	(if electronic book entry transfer)

 

	 	Transaction Code Number:	 
	 	(if electronic book entry transfer)

 

	Installment Amount(s) to be reduced (and

corresponding Installment Date(s)) and amount 

of reduction:	_________________________________

 

    	 

    	 

    

 

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 transfer agent instructions dated _____________, 20__ from the Company.

 

	 	BOLDFACE GROUP, INC.

 

	 	By:	 
	 	 	Name:
	 	 	Title:Warrant Certificate No. [__] – 
[__]

 

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

 

COMMON STOCK PURCHASE WARRANT

 

BOLDFACE
GROUP, INC.

 

	Warrant Shares: [___________]	Initial Exercise Date: December 21, 2012

 

THIS COMMON STOCK PURCHASE
WARRANT (the “Warrant”) certifies that, for value received, _____________ or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on
or after the date hereof (the “Initial Exercise Date”) and on or prior to the close of business on December
20, 2017 (the “Termination Date”) but not thereafter, to subscribe for and purchase from BOLDFACE Group, Inc.,
a Nevada corporation (the “Company”), up to the number of shares indicated above (subject to adjustment as provided
herein) of Common Stock (the “Warrant Shares”). The purchase price of one share of Common Stock under this Warrant
shall be equal to the Exercise Price, as defined in Section 2(b).

 

Section 1.          Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement
(the “Purchase Agreement”), dated December 21, 2012, among the Company and the purchasers signatory thereto.

 

    	 

    	 

    

 

Section 2.          Exercise.

 

(a)          Exercise
of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times
on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or
agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing
on the books of the Company) of a duly executed facsimile copy of the Notice of Exercise form annexed hereto. Within three (3)
Business Days following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares
specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the
cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. Notwithstanding
anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the
Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the
Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date the final Notice
of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number
of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder
in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing
the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of
Exercise within five (5) Business Days of receipt of such notice. THE HOLDER AND ANY ASSIGNEE, BY ACCEPTANCE OF THIS WARRANT,
ACKNOWLEDGE AND AGREE THAT, BY REASON OF THE PROVISIONS OF THIS PARAGRAPH, FOLLOWING THE PURCHASE OF A PORTION OF THE WARRANT SHARES
HEREUNDER, THE NUMBER OF WARRANT SHARES AVAILABLE FOR PURCHASE HEREUNDER AT ANY GIVEN TIME MAY BE LESS THAN THE AMOUNT STATED ON
THE FACE HEREOF.

 

(b)          Exercise
Price. The exercise price per share of the Common Stock under this Warrant shall be $0.50, subject to adjustment hereunder
(the “Exercise Price”).

 

(c)          Cashless
Exercise. The Holder may, in its sole discretion, exercise this Warrant, in whole or in part, at any time by means of a “cashless
exercise” in which the Holder shall be entitled to receive a certificate for the number of Warrant Shares equal to the quotient
obtained by dividing [(A-B) (X)] by (A), where:

 

		(A)  =	the VWAP on the Trading Day immediately preceding the date on which Holder elects to exercise this
Warrant by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;

 

		(B)  =	the Exercise Price of this Warrant, as adjusted hereunder; and

 

		(X)  =	the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance
with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

 

Notwithstanding the
foregoing, provided that a registration statement covering the resale of the Warrant Shares by the Holder has (x) been declared
effective by the U.S. Securities and Exchange Commission (the “SEC”) and (y) remained effective for a period
of one year, any Cashless Exercise right hereunder shall thereupon terminate.

 

    	2

    	 

    

 

(d)          Mechanics
of Exercise.

 

i.            Delivery
of Certificates upon Exercise. Certificates for shares purchased hereunder shall be transmitted by the Transfer Agent to the
Holder by crediting the account of the Holder’s prime broker with The Depository Trust Company through its Deposit or Withdrawal
at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an
effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder
or (B) the shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144, and
otherwise by physical delivery to the address specified by the Holder in the Notice of Exercise by the date that is seven (7) Business
Days after the latest of (A) the delivery to the Company of the Notice of Exercise, (B) surrender of this Warrant (if required),
and (C) payment of the aggregate Exercise Price as set forth above (including by cashless exercise, if permitted) (such date, the
“Warrant Share Delivery Date”). The Warrant Shares shall be deemed to have been issued, and the Holder or any
other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes,
as of the date the Warrant has been exercised, with payment to the Company of the Exercise Price (or by cashless exercise, if permitted)
and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi) hereof prior to the issuance of such shares,
having been paid. If the Company fails for any reason to deliver to the Holder certificates evidencing the Warrant Shares subject
to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages
and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the
date of the applicable Notice of Exercise), $10.00 per Trading Day (increasing to $20.00 per Trading Day on the eleventh Trading
Day after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such certificates
are delivered or the Holder rescinds such exercise or the Holder and the Company agree to otherwise.

 

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

 

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

 

iv.         Charges,
Taxes and Expenses. Issuance of certificates for Warrant Shares shall be made without charge to the Holder for any issue or
transfer tax or other incidental expense in respect of the issuance of such certificate, all of which taxes and expenses shall
be paid by the Company, and such certificates shall be issued in the name of the Holder or in such name or names as may be directed
by the Holder; provided, however, that in the event certificates for Warrant Shares are to be issued in a name other
than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto
duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it
for any transfer tax incidental thereto.

 

    	3

    	 

    

 

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

 

(e)          Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise
any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after
exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of
the Beneficial Ownership Limitation (as defined below).  For purposes of the foregoing sentence, the number of shares of Common
Stock beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise
of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock
which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder
or any of its Affiliates and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of
the Company (including, without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise
analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates.  Except as set forth
in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section
13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company
is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder
is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained
in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by
the Holder together with any Affiliates) and of which portion of this Warrant is exercisable shall be in the sole discretion of
the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant
is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this
Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to
verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above
shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number
of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with
the SEC, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company
or the Transfer Agent setting forth the number of shares of Common Stock outstanding.  Upon the written or oral request of
a Holder, the Company shall within three (3) Trading Days confirm orally and in writing to the Holder the number of shares of Common
Stock then outstanding.  In any case, the number of outstanding shares of Common Stock shall be determined after giving effect
to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates since the date
as of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall be 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock issuable upon exercise of this Warrant. The Holder, upon not less than 61 days’ prior notice to the Company,
may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership
Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to
the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e)
shall continue to apply. Any such increase or decrease will not be effective until the 61st day after such notice is
delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict
conformity with the terms of this Section 2(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. The limitations contained in this paragraph shall apply to any successor holder of this
Warrant.

 

    	4

    	 

    

 

Section 3.          Certain
Adjustments.

 

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

 

Simultaneously with
any adjustment to the Exercise Price pursuant to this paragraph (a) of this Section 3, the number of Warrant Shares that may be
purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate
Exercise Price payable hereunder for the adjusted number of Warrant Shares shall be the same as the aggregate Exercise Price in
effect immediately prior to such adjustment (without regard to any limitations on exercise contained herein).

 

    	5

    	 

    

 

(b)          Subsequent
Equity Sales.

 

(i)          If
the Company or any Subsidiary thereof, as applicable, at any time while this Warrant is outstanding, shall sell or grant any option
to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any
option to purchase or other disposition) any Common Stock or Common Stock Equivalents, at an effective price per share less than
the Exercise Price then in effect (such lower price, the “New Issuance Price” and such issuances collectively,
a “Dilutive Issuance”) (it being understood and agreed that if the holder of the Common Stock or Common Stock
Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion,
exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such
issuance, be entitled to receive shares of Common Stock at an effective price per share that is less than the Exercise Price, such
issuance shall be deemed to have occurred for less than the Exercise Price on such date of the Dilutive Issuance at such effective
price), then simultaneously with the consummation of each Dilutive Issuance the Exercise Price shall be reduced and only reduced
by multiplying the Exercise Price by a fraction, the numerator of which is the number of shares of Common Stock issued and outstanding
immediately prior to the Dilutive Issuance plus the number of shares of Common Stock which the offering price for such Dilutive
Issuance would purchase at the then Exercise Price, and the denominator of which shall be the sum of the number of shares of Common
Stock issued and outstanding immediately prior to the Dilutive Issuance plus the number of shares of Common Stock so issued or
issuable in connection with the Dilutive Issuance (the “Adjusted Price”); provided, that the Exercise Price
shall not be reduced below $0.05 (subject to adjustment for stock splits, reverse splits and similar capital adjustments). Such
adjustment shall be made whenever such Common Stock or Common Stock Equivalents are issued. Notwithstanding the foregoing, no adjustments
shall be made, paid or issued under this Section 3(b) in respect of an Exempt Issuance.

 

(ii)         The
Company shall promptly notify the Holder, in writing, following the issuance or deemed issuance of any Common Stock or Common Stock
Equivalents subject to this Section 3(b), indicating therein the applicable issuance price, or applicable reset price, exchange
price, conversion price and other pricing terms (such notice, the “Dilutive Issuance Notice”). For purposes
of clarification, whether or not the Company provides a Dilutive Issuance Notice pursuant to this Section 3(b), upon the occurrence
of any Dilutive Issuance, the Holder is entitled to exercise the Warrant at the Adjusted Price regardless of whether the Holder
accurately refers to the Adjusted Price in the Notice of Exercise.

 

(iii)        For
clarity, no adjustment of the number of Warrant Shares shall be made upon any adjustment of the Exercise Price pursuant to this
Section 3(b).

 

(iv)        If
the purchase or exercise price provided for in any Common Stock Equivalents, or the rate at which any Common Stock Equivalents
are convertible into or exercisable or exchangeable for shares of Common Stock increases or decreases at any time, the Exercise
Price in effect at the time of such increase or decrease shall be adjusted to the Exercise Price which would have been in effect
at such time had such Common Stock Equivalents 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 3((b)(iv)

, if the terms of any Common Stock Equivalents that was outstanding as of the date of issuance of this
Warrant are increased or decreased in the manner described in the immediately preceding sentence, then such Common Stock Equivalents
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.

 

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(v)         No
adjustment pursuant to this Section 3(b) shall be made if such adjustment would result in an increase of the Exercise Price then
in effect.

 

(c)          Fundamental
Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group
acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person
or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share
purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent
exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon
such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard
to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant
is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise
of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to
apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in
a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common
Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder
shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental
Transaction. Notwithstanding anything to the contrary, in the event of a Fundamental Transaction that is (1) an all cash transaction,
(2) a “Rule 13e-3 transaction” as defined in Rule 13e-3 under the Exchange Act, or (3) a Fundamental Transaction involving
a person or entity not traded on a national securities exchange, the Company or any Successor Entity (as defined below) shall,
at the Holder’s option, exercisable at any time concurrently with, or within 30 days after, the consummation of the Fundamental
Transaction, purchase this Warrant from the Holder by paying to the Holder an amount of cash
equal to the Black Scholes Value of the remaining unexercised portion of this Warrant on the date of the consummation of such Fundamental
Transaction. “Black Scholes Value” means the value of this Warrant based on the Black and Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”) determined as of the day
of consummation of the applicable Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding
to the U.S. Treasury rate for a period equal to the time between the date of the public announcement of the applicable Fundamental
Transaction and the Termination Date, (B) an expected volatility equal to the greater of 100% and the 100 day volatility obtained
from the HVT function on Bloomberg as of the Trading Day immediately following the public announcement of the applicable Fundamental
Transaction, (C) the underlying price per share used in such calculation shall be the sum of the price per share being offered
in cash, if any, plus the value of any non-cash consideration, if any, being offered in such Fundamental Transaction and (D) a
remaining option time equal to the time between the date of the public announcement of the applicable Fundamental Transaction and
the Termination Date. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the
survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant
and the other Transaction Documents in accordance with the provisions of this Section 3(f) pursuant to written agreements in form
and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental
Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor
Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a
corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common
Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant)
prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of
capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction
and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose
of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which
is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor
Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions
of this Warrant and the other Transaction Documents referring to the “Company” shall refer instead to the Successor
Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this
Warrant and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.

 

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

 

    	7

    	 

    

 

(e)          Notice
to Holder.

 

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

 

ii.         Notice
to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the
Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the
Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares
of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection
with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer
of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted
into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation
or winding up of the affairs of the Company, then, in each case, the Company shall cause to be mailed to the Holder at its last
address as it shall appear upon the Warrant Register (as defined below) of the Company, at least five (5) calendar days, or such
longer period as may be required by law, prior to the applicable record or effective date hereinafter specified, a notice stating
(x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or
if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend,
distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation,
merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that
holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure
to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required
to be specified in such notice. To the extent that any notice provided hereunder constitutes, or contains, material, non-public
information regarding the Company or any of the Subsidiaries, the Company shall use its best efforts to simultaneously file such
notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant
during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may
otherwise be expressly set forth herein.

 

Section 4.          Transfer
of Warrant.

 

(a)          Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions
of Section 4.3 of the Purchase Agreement, this Warrant and all rights hereunder (including, without limitation, any registration
rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated
agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder
or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender
and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or
assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue
to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.
The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without
having a new Warrant issued.

 

    	8

    	 

    

 

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

 

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

 

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

 

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

 

Section 5.          Miscellaneous.

 

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

 

    	9

    	 

    

 

(b)          Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of
the Warrant, shall include, if determined necessary by the Company, the posting of any bond), and upon surrender and cancellation
of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like
tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

 

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

 

(d)          Authorized
Shares.

 

The Company covenants
that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged
with the duty of executing stock certificates to execute and issue the necessary certificates for the Warrant Shares upon the exercise
of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that
such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements
of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued
upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by
this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect
of any transfer occurring contemporaneously with such issue).

 

Except and to the extent
as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate
or articles of incorporation or formation or through any reorganization, transfer of assets, consolidation, merger, dissolution,
issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms
of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such
actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without
limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount
payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary
or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise
of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under
this Warrant.

 

    	10

    	 

    

 

Before taking any action
which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price,
the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public
regulatory body or bodies having jurisdiction thereof.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

    	11

    	 

    

 

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

 

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

 

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

 

(Signature Page
Follows)

 

    	12

    	 

    

 

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

 

	 	BOLDFACE Group, Inc.
	 	 	 
	 	By:	 
	 		Name: Nicole Ostoya
	 		Title:   Chief Executive Officer and President

 

    	13

    	 

    

 

NOTICE OF EXERCISE

 

		To:	boldface Group, Inc.

1309 Pico Blvd., Suite A

Santa Monica, CA 90405

Attention: Chief Financial Officer

 

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

 

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

 

 ̈
$_________ (in lawful money of the United States as provided for in the foregoing Warrant) and any applicable taxes payable
by the undersigned pursuant to such Warrant; or

 

 ̈
__________ shares of Common Stock for cancellation (pursuant to a cashless exercise in accordance with the formula set forth
in subsection 2(c) of this Warrant) (check here if the undersigned desires to deliver an unspecified number of shares equal to
the number sufficient to effect a Cashless Exercise [___])

 

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

 

	 	 	 
	 	 	 
	 	 	 
	 	(Please print name, address and social security or
	 	federal employer identification number (if applicable))

 

(4)         [if
applicable] The Warrant Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate
to:

 

	 	 	 
	 	 	 
	 	 	 

 

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

 

	 	 
	(Signature of Authorized Signatory of Holder)

 

	Name of Holder (print):	 

	Name of Authorized Signatory:	 

	Title of Authorized Signatory:	 

	Date:	 

 

    	 

    	 

    

 

ASSIGNMENT FORM

 

(To assign the foregoing warrant, execute

this form and supply required information.

Do not use this form to exercise the warrant.)

 

FOR VALUE RECEIVED, ___________________________________
hereby sells, assigns and transfers to each assignee set forth below all of the rights of the undersigned under the Warrant (as
defined in and evidenced by the attached Warrant) to acquire the number of Warrant Shares set opposite the name of such assignee
below and in and to the foregoing Warrant with respect to said acquisition rights and the shares issuable upon exercise of the
Warrant:

 

	Name of Assignee	 	Address	 	Number of Shares
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

If the total of the Warrant Shares are
not all of the Warrant Shares evidenced by the foregoing Warrant, the undersigned requests that a new Warrant evidencing the right
to acquire the Warrant Shares not so assigned be issued in the name of and delivered to the undersigned.

 

	Name of Holder (print):	 
	 	 
	(Signature of Authorized Signatory of Holder):	 
	(Name of Authorized Signatory):	 
	(Title of Authorized Signatory):	 
	Date:	 

 

NOTE: The signature
to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement
or any change whatsoever. Officers of corporations and those acting in a fiduciary or other representative capacity should file
proper evidence of authority to assign the foregoing Warrant.

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