Document:

Exhibit 10.10

 

THE SECURITIES EVIDENCED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND HAVE BEEN ISSUED IN RELIANCE
UPON AN EXEMPTION FROM THE REQUIREMENTS FOR SUCH REGISTRATION FOR NONPUBLIC OFFERINGS. ACCORDINGLY, THE SALE, TRANSFER, PLEDGE,
HYPOTHECATION OR OTHER DISPOSITION OF THE SECURITIES EVIDENCED HEREBY OR ANY PORTION THEREOF OR INTEREST THEREIN MAY NOT BE ACCOMPLISHED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE
TO THE COMPANY TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED.

 

VOID AFTER 5:00 P.M., PACIFIC TIME ON [Three Years from Issue Date]

 

WARRANT

 

	Number: _____	 
	Number of Shares:	_________
	Exercise Price:	_________

 

For the Purchase of

Shares of Common Stock, $.001 Par Value

Of

Medbox, Inc.

A Nevada Corporation

 

This Warrant is being
issued in conjunction with a certain 5% Convertible Debenture Due __________, __ 201_, (“Debenture”), issued
on the date hereof to _______________ or its registered assigns (“Holder”).

 

THIS CERTIFIES THAT, for value received, Holder, as registered owner of this Warrant (“Warrant”),
is entitled to at any time or from time to time after [Issue Date] and before 5:00 P.M., Pacific Time, [Three Years from
Issue Date], but not thereafter (the “Warrant Exercise Term”), to subscribe for, purchase and receive a number
of fully paid and non-assessable shares of the common stock, $.001 par value (the “Common Stock”), of Medbox, Inc.,
a Nevada corporation (the “Company”), determined by dividing the Principal Amount of the applicable Debenture
by a price (the “Reference Price”) equal to 120% of the last reported closing price of the Common Stock on the date
hereof, at an exercise price equal to the applicable Reference Price (such price, being referred to herein as the “Exercise
Price”), upon presentation and surrender of this Warrant and upon payment of the Exercise Price for such shares of the Common
Stock to the Company at the principal office of the Company, but subject to the conditions set forth in the Statement of Rights;
provided, however, that upon the occurrence of any of the events specified in the Statement of Rights, the rights granted by this
Warrant shall be adjusted as therein specified. Payment of the Exercise Price may be made in cash, by cashier’s check, wire
transfer or Cashless Exercise as provided in the Statement of Rights. Upon exercise of this Warrant, the form of election hereinafter
provided for must be duly executed and the instructions for registration of the Common Stock acquired by such exercise must be
completed. If the subscription rights represented hereby shall not be exercised at or before 5:00 P.M., Pacific Time, on [Three
Years from Issue Date], this Warrant shall become and be void without further force or effect, and all rights represented hereby
shall cease and expire.

 

    	1

    	 

    

 

This Warrant may be
exercised in accordance with its terms in whole or in part. In the event of the exercise or assignment hereof in part only, the
Company shall cause to be delivered to the Holder a new Warrant of like tenor to this Warrant in the name of the Holder representing
the number of shares with respect to which this Warrant shall not then have been exercised.

 

In no event shall this
Warrant (or the shares of the Common Stock issuable upon full or partial exercise hereof) be offered or sold except in conformity
with the Securities Act of 1933, as amended

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to be signed by its duly authorized officer as of January __, 2015.

 

Medbox, Inc.

a Nevada corporation

 

By: Guy Marsala

Its: Chief Executive Officer

 

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ANNEX A

 

STATEMENT OF RIGHTS OF WARRANT HOLDER

 

1.            Exercise
of Warrant.

 

1.1           Cash
Exercise. This Warrant may be exercised in whole or in part at any time or from time during the Warrant Exercise Term, by presentation
and surrender hereof to the Company, with the Exercise Form annexed hereto duly executed and accompanied by payment by cashier’s
check or wire transfer of the Exercise Price for the number of shares specified in such form, together with all federal and state
taxes applicable upon such exercise. If this Warrant should be exercised in part only, the Company shall, upon surrender of this
Warrant for cancellation, execute and deliver a new Warrant evidencing the right of the Holder to purchase the balance of the shares
purchasable hereunder. Upon receipt by the Company of this Warrant and the Exercise Price at the office or agency of the Company,
in proper form for exercise, the Holder shall be deemed to be the holder of record of the shares of Common Stock issuable upon
such exercise, notwithstanding that the stock transfer books of the Company shall then be closed or that certificates representing
such shares of Common Stock shall not then be actually delivered to the Holder.

 

1.2          Cashless Exercise. At any time during the Warrant Exercise Term, the Holder may, at the
Holder’s option, exchange, in whole or in part, this Warrant (a “Warrant Exchange”), into the number of Shares
determined in accordance with this Section 1.2, by surrendering this Warrant at the principal office of the Company or at the office
of its transfer agent, accompanied by a notice stating such Holder’s intent to effect such exchange, the number of shares
subject to the Warrant to be so exchanged and the date on which the Holder requests that such Warrant Exchange occur (the “Notice
of Exchange”). The Warrant Exchange shall take place on the date specified in the Notice of Exchange or, if later, the date
the Notice of Exchange is received by the Company (the “Exchange Date”). Certificates for the shares of Common Stock
issuable upon such Warrant Exchange and, if applicable, a new Warrant of like tenor representing the shares which were subject
to the surrendered Warrant and not included in the Warrant Exchange, shall be issued as of the Exchange Date and delivered to the
Holder within three (3) trading days following the Exchange Date. In connection with any Warrant Exchange, the Holder shall be
entitled to subscribe for and acquire (i) the number of shares of Common Stock (rounded to the next highest integer) which would,
but for the Warrant Exchange, then be issuable pursuant to the provision of Section 1.1 above upon the exercise of the Warrant
specified by the Holder in its Notice of Exchange (the “Total Number”) less (ii) the number of shares of Common Stock
equal to the quotient obtained by dividing (a) the product of the Total Number and the existing Exercise Price (as hereinafter
defined) by (b) the Market Price (as hereinafter defined) of a Public Share on the day preceding the Warrant Exchange. “Market
Price” at any date shall be deemed to be the last reported sale price, or, in case no such reported sales takes place on
such day, the average of the last reported sales prices for the last three (3) trading days, in either case as officially reported
by the principal securities exchange on which the Common Stock is listed or admitted to trading or as reported by the Nasdaq Stock
Market, Inc., or, if the Common Stock is not listed or admitted to trading on any national securities exchange or quoted on the
Nasdaq Stock Market, Inc., the closing bid price as furnished by (i) the National Quotation Bureau, Inc. or (ii) a similar organization
if the National Quotation Bureau, Inc. is no longer reporting such information.

 

ANNEX A - STATEMENT
OF RIGHTS OF WARRANT HOLDER

    	-1-

    	 

    

 

2.             Rights
of the Holder and Exercise Limitation.

 

2.1           The
Holder shall not, by virtue hereof, be entitled to any rights of a stockholder in the Company, either at law or equity, and the
rights of the Holder are limited to those expressed in the Warrant and are not enforceable against the Company except to the extent
set forth herein.

 

2.2           The
Company shall not effect any exercise of this Warrant, and the Holder shall not have the right to exercise this Warrant, to the
extent that after giving effect to such exercise, the Holder (together with the Holder’s affiliates, and any persons acting
as a group together with the Holder or any of the Holder’s affiliates) would beneficially own in excess of 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 such exercise of this Warrant by the Holder. For purposes of this Section 2.2, in determining the number of outstanding shares
of Common Stock, the Holder may rely on the number of outstanding shares of Common Stock as stated in the most recent of the following:
(i) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (ii) a more recent
public announcement by the Company, or (iii) a more recent written notice by the Company or the Company’s transfer agent
setting forth the number of shares of Common Stock outstanding.  The Holder, upon not less than 61 days’ prior
notice to the Company, may increase or decrease this beneficial ownership limitation, 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 by the Holder. Any such increase or decrease will not be effective until
the 61st day after such notice is delivered to the Company. 

 

3.             Adjustments.

 

3.1           Reclassification,
Etc. In case of any reclassification or change of the outstanding shares of Common Stock (other than a change in par value
to no par value, or from no par value to par value, or as a result of a subdivision or combination), the Holder shall thereafter
have the right to purchase the kind and number of shares of stock and other securities and property receivable upon such reclassification
or change as if the Holder was the owner of the shares of Common Stock underlying the Warrant immediately prior to any such events
at a price equal to the product of (x) the number of shares of Common Stock issuable upon exercise of the Holder’s Warrant
and (y) the Exercise Price in effect immediately prior to the record date for such reclassification or change as if such Holder
had exercised the Warrant.

 

ANNEX A - STATEMENT
OF RIGHTS OF WARRANT HOLDER

    	-2-

    	 

    

 

3.2           Consolidation,
Merger, Etc. In the case of any consolidation of the Company with, or merger of the Company into, another corporation (other
than a consolidation or merger in which the Company is the surviving corporation and which does not result in any reclassification
or change of the outstanding shares of Common Stock, except a change as a result of a subdivision or combination of such shares
or a change in par value, as aforesaid), or in the case of a sale or conveyance to another corporation of the property of the Company
as an entirety, the Holder shall have the right to purchase the kind and number of shares of stock and other securities and property
receivable upon such consolidation, merger, sale or conveyance as if the Holder was the owner of the shares of Common Stock underlying
the Warrant immediately prior to any such events at a price equal to the product of (x) the number of shares of Common Stock issuable
upon exercise of the Holder’s Warrant and (y) the Exercise Price in effect immediately prior to the record date for such
consolidation, merger, sale or conveyance as if such Holder had exercised the Warrant (the “Merger Right”). Notwithstanding
the foregoing, in the case of any consolidation of the Company with, or merger of the Company into, a corporation affiliated with
the Company or any of the Company’s officers or directors (such a corporation referred to herein as an “Affiliate”),
or the sale or conveyance to an Affiliate of the property of the Company as an entirety, prior to the end of the Warrant Exercise
Term, the Holder shall have the Merger Right.

 

3.3           Dividends
and Other Distributions with Respect to Outstanding Securities. In the event that the Company shall at any time make any distribution
of its assets to holders of its Common Stock as a liquidating or a partial liquidating dividend, then the Holder of the Warrant
who exercises its Warrant after the record date for the determination of those holders of Common Stock entitled to such distribution
of assets as a liquidating or partial liquidating dividend shall be entitled to receive for the Warrant Price per Warrant, in
addition to each share of Common Stock, the amount of such distribution (or, at the option of the Company, a sum equal to the
value of any such assets at the time of such distribution as determined by the Board of Directors of the Company in good faith)
which would have been payable to such Holder had he been the holder of record of the Common Stock receivable upon exercise of
his Warrant on the record date for the determination of those entitled to such distribution. At the time of any such dividend
or distribution, the Company shall make appropriate reserves to ensure the timely performance of the provisions of this subsection
3.3. 

 

4.            Notices to Warrant
Holders. So long as this Warrant shall be outstanding and unexercised (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the holders of Common Stock for subscription or purchase
by them any shares of stock of any class or any other rights or (iii) if any capital reorganization of the Company, reclassification
of the capital stock of the Company, consolidation or merger of the Company with or into another corporation, sale, lease or transfer
of all or substantially all of the property and assets of the Company to another corporation, or voluntary or involuntary dissolution,
liquidation or winding up of the Company shall be effected, then, in any such case, the Company shall cause to be delivered to
the Holder, at least ten (10) days prior to the date specified in (x) or (y) below, as the case may be, a notice containing a brief
description of the proposed action and stating the date on which (x) a record is to be taken for the purpose of such dividend,
distribution or rights, or (y) such reclassification, reorganization, consolidation, merger, conveyance, lease, dissolution, liquidation
or winding up is to take place and the date, if any, is to be fixed, as of which the holders of Common Stock of record shall be
entitled to exchange their shares of Common Stock for securities or other property deliverable upon such reclassification, reorganization,
consolidation, merger, conveyance, dissolution, liquidation or winding up.

 

ANNEX A - STATEMENT
OF RIGHTS OF WARRANT HOLDER

    	-3-

    	 

    

 

5.             Officer’s
Certificate. Whenever the Exercise Price shall be adjusted as required by the provisions hereof, the Company shall forthwith
file in the custody of its Secretary or an Assistant Secretary at its principal office, and with its stock transfer agent, if any,
an officer’s certificate showing the adjusted Exercise Price determined as herein provided and setting forth in reasonable
detail the facts requiring such adjustment, and shall provide such officer’s certificate to the Holder hereof. Each such
officer’s certificate shall be made available at all reasonable times for inspection by the Holder and the Company shall,
forthwith after each such adjustment, deliver a copy of such certificate to the Holder. Such certificate shall be conclusive as
to the correctness of such adjustment.

 

6.             Restrictions
on Transfer. The Holder of this Warrant, by acceptance thereof, agrees that, absent an effective notification under Regulation
A or registration statement, in either case under the Securities Act of 1933 (the “Act”), covering the disposition
of this Warrant or the Common Stock issued or issuable upon exercise hereof, such Holder will not sell or transfer any or all of
this Warrant or such Common Stock without first providing the Company with an opinion of counsel reasonably satisfactory to the
Company to the effect that such sale or transfer will be exempt from the registration and prospectus delivery requirements of the
Act. Such Holder agrees that the Company may issue instructions to its transfer agent to place, or may itself place, a “stop
order” on transfers with respect to the Warrant and Common Stock and that the certificates evidencing the Warrant and Common
Stock which will be delivered to such Holder by the Company shall bear substantially the following legend:

 

THE SECURITIES EVIDENCED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, (THE “ACT’) AND HAVE BEEN ISSUED
IN RELIANCE UPON AN EXEMPTION FROM THE REQUIREMENTS FOR SUCH REGISTRATION FOR NONPUBLIC OFFERINGS. ACCORDINGLY, THE SALE, TRANSFER,
PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE SECURITIES EVIDENCED HEREBY OR ANY PORTION THEREOF OR INTEREST THEREIN MAY NOT
BE ACCOMPLISHED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY IN FORM
AND SUBSTANCE TO THE COMPANY TO THE EFFECT THAT SUCH REGISTRATION IS NOT REQUIRED. 

 

Each Holder of this
Warrant, at the time all or a portion of such Warrant is exercised, agrees to make such written representations to the Company
as counsel for the Company may reasonably request, in order that the Company may be reasonably satisfied that such exercise of
the Warrant and consequent issuance of Common Stock will not violate the registration and prospectus delivery requirements of the
Act, or other applicable state securities laws.

 

7.             Expenses
and Procedures of Registration.

 

(A)          Expenses
of Registration. All registration expenses (exclusive of underwriting discounts and commissions) shall be borne by the Company.
Each Holder and Warrant Share Holder shall bear all underwriting discounts, selling commissions, sales concessions and similar
expenses applicable to the sale of the Warrant Shares sold by such Holder.

 

ANNEX A - STATEMENT
OF RIGHTS OF WARRANT HOLDER

    	-4-

    	 

    

 

(B)           Registration
Procedures. In the case of the registration, qualification or compliance effected by the Company pursuant to Section 7 hereof,
the Company will keep the Holders of Warrant Shares advised as to the initiation of registration, qualification and compliance
and as to the completion thereof. At its expense, the Company will furnish such number of prospectuses and other documents incident
thereto as the Holders or underwriters from time to time may reasonably request.

 

(C)           Information.
The Company may require each seller of Warrant Shares as to which any registration is being effected to furnish such information
regarding the distribution of such Warrant Shares as the Company may from time to time reasonably request and the Company may exclude
from such registration the Warrant Shares of any seller who unreasonably fails to furnish such information after receiving such
request.

 

(D)           Blue
Sky. The Company will, as expeditiously as possible, use its best efforts to register or qualify the Warrant Shares covered
by a registration statement at the expense of the Company in such jurisdictions as the Holders of such Warrant Shares or, in the
case of an underwritten public offering, the managing underwriter shall reasonably request at the expense of the Holders of the
Warrant Shares being registered provided that the Company shall not be required in connection with any such registration or qualification
or as a condition thereto to qualify to do business in any jurisdiction where it is not so qualified or to take any action which
would subject it to taxation or service of process in any jurisdiction where it is not otherwise subject to such taxation or service
of process.

 

(E)           Notification
of Material Events. The Company will, as expeditiously as possible, immediately notify each Holder of Warrant Shares under
a registration statement, at any time when a prospectus relating thereto is required to be delivered under the Act, of the happening
of any event as a result of which the prospectus contained in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing and, as expeditiously as possible, amend or supplement such
prospectus to eliminate the untrue statement or the omission.

  

(F)           Opinions.
The Company will use its best efforts (if the offering is underwritten) to furnish, at the request of any Holder of Warrant Shares,
on the date that Warrant Shares are delivered to the underwriters for sale pursuant to such registration: (i) an opinion dated
such date of counsel representing the Company for the purposes of such registration, addressed to the underwriters and to such
holder, stating that such registration statement has become effective under the Act and that (A) to the best knowledge of such
counsel, no stop order suspending the effectiveness thereof has been issued and no proceedings for that purpose have been instituted
or are pending or contemplated under the Act, (B) the registration statement, the related prospectus, and each amendment or supplement
thereof, comply as to form in all material respects with the requirements of the Act (except that such counsel need express no
opinion as to financial statements and financial and statistical data contained therein) and (C) to such other effects as may reasonably
be requested by counsel for the underwriters or by such holder or its counsel, and (ii) a letter dated such date from the independent
public accountants retained by the Company, addressed to the underwriters and to such holder, stating that they are independent
public accountants within the meaning of the Act and that, in the opinion of such accountants, the financial statements of the
Company included in the registration statement or the prospectus, or any amendment or supplement thereof, comply as to form in
all material respects with the applicable accounting requirements of the Act, and such letter shall additionally cover such other
financial matters (including information as to the period ending no more than five (5) business days prior to the date of such
letter) with respect to the registration in respect of which such letter is being given as such underwriters or holder may reasonably
request.

 

ANNEX A - STATEMENT
OF RIGHTS OF WARRANT HOLDER

    	-5-

    	 

    

 

8.             Loss
or Mutilation. Upon receipt by the Company of evidence satisfactory to it (in the exercise of reasonable discretion) of the
ownership of and the loss, theft, destruction or mutilation of any Warrant and (in the case of loss, theft or destruction) of indemnity
satisfactory to it (in the exercise of reasonable discretion), and (in the case of mutilation) upon surrender and cancellation
thereof, the Company will execute and deliver in lieu thereof a new Warrant of like tenor.

 

9.             Reservation
of Common Stock. The Company shall at all times reserve and keep available for issue upon the exercise of Warrants such number
of its authorized but unissued shares of Common Stock as will be sufficient to permit the exercise in full of all outstanding Warrants.

 

10.           Notices.
All notices and other communications from the Company to the Holder of this Warrant shall be mailed by first class registered
or certified mail, postage prepaid, to the address furnished to the Company in writing by the last Holder of this Warrant who
shall have furnished an address to the Company in writing. 

 

11.           Change;
Waiver. Neither this Warrant nor any term hereof may be changed, waived, discharged or terminated orally but only by an instrument
in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought.

 

12.           Law
Governing. This Warrant shall be construed and enforced in accordance with and governed by the laws of California.

 

ANNEX A - STATEMENT
OF RIGHTS OF WARRANT HOLDER

    	-6-

    	 

    

 

ANNEX B

 

FORM TO BE USED TO EXERCISE WARRANT

 

TO: Medbox, Inc.

 

DATE:                                                 

 

The Undersigned hereby
elects irrevocably to exercise the within Warrant and to purchase ______ shares of the Common Stock of the Company called for thereby,
and hereby makes payment by:

 

(check one)

 

 ̈           Cashier's
check of $______ (at the rate of $.001 per share of Common Stock) in payment of the Exercise Price pursuant thereto; or

 

 ̈           Cashless
Exercise.

 

Please issue the shares
of Common Stock as to which this Warrant is exercised in the name of:

 

(Name)

 

(Address)

 

(Taxpayer Number)

 

and if said number of Warrants shall not
be all the Warrants evidenced by the within Warrant Certificate, issue a new Warrant Certificate for the balance remaining of such
Warrants to the undersigned at the address stated below.

 

 

	 	Name of Holder:	 
	 	 	 
	 	 	(Please Print)

 

	 	Signature:	 

 

	 	 	(Address)

 

NOTICE: The signature
to the form to exercise must correspond with the name as written upon the face of the within Warrant in every particular without
alteration or enlargement or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust
company or by a firm having membership on a registered national securities exchange.

 

ANNEX B - FORM
TO BE USED TO EXERCISE WARRANT

    	-7-Exhibit 10.11

 

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

 

Original Issue Date: _____________,
2015

 

$50,000

 

8%
CONVERTIBLE DEBENTURE

DUE
_____________, 2018

 

THIS 8% CONVERTIBLE
DEBENTURE is one of a series of duly authorized and validly issued 8% Convertible Debentures of Medbox, Inc., a Nevada corporation,
(the “Company”), having its principal place of business at 8439 West Sunset, Blvd., Suite 101, West Hollywood,
CA 90069, designated as its 8% Convertible Debenture due _________, 2018 (this Debenture, the “Debenture” and,
collectively with the other Debentures of such series, the “Debentures”).

 

FOR VALUE RECEIVED,
the Company promises to pay to __________ or his registered assigns (the “Holder”), or shall have paid pursuant
to the terms hereunder, the principal sum of $50,000 on _________, 2018 (the “Maturity Date”) or such earlier
date as this Debenture is required or permitted to be repaid as provided hereunder, and to pay interest to the Holder on the aggregate
unconverted and then outstanding principal amount of this Debenture in accordance with the provisions hereof. This Debenture is
subject to the following additional provisions:

 

Section 1.             Definitions.
For the purposes hereof, in addition to the terms defined elsewhere in this Debenture the following terms shall have the following
meanings: 

 

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

 

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

  

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

 

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

 

“Change
of Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date hereof
by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of
effective control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of
in excess of 33% of the voting securities of the Company (other than by means of conversion or exercise of the Debentures and the
Securities issued together with the Debentures), (b) the Company merges into or consolidates with any other Person, or any Person
merges into or consolidates with the Company and, after giving effect to such transaction, the stockholders of the Company immediately
prior to such transaction own less than 66% of the aggregate voting power of the Company or the successor entity of such transaction,
(c) the Company sells or transfers all or substantially all of its assets to another Person and the stockholders of the Company
immediately prior to such transaction own less than 66% of the aggregate voting power of the acquiring entity immediately after
the transaction, (d) a replacement at one time or within a three year period of more than one-half of the members of the Board
of Directors which is not approved by a majority of those individuals who are members of the Board of Directors on the Original
Issue Date (or by those individuals who are serving as members of the Board of Directors on any date whose nomination to the Board
of Directors was approved by a majority of the members of the Board of Directors who are members on the date hereof), or (e) the
execution by the Company of an agreement to which the Company is a party or by which it is bound, providing for any of the events
set forth in clauses (a) through (d) above.

  

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

 

    	2

    	 

    

 

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

 

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

 

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

 

“Conversion
Shares” means, collectively, the shares of Common Stock issuable upon conversion of this Debenture in accordance with
the terms hereof.

 

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

 

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

 

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

 

“Equity
Conditions” means, during the period in question, (a) the Company shall have
duly honored all conversions and redemptions scheduled to occur or occurring by virtue of one or more Notices of Conversion of
the Holder, if any, (b) the Company shall have paid all liquidated damages and other amounts owing to the Holder in respect of
this Debenture, (c)(i) there is an effective Registration Statement pursuant to which the Holder is permitted to utilize
the prospectus thereunder to resell all of the shares of Common Stock issuable pursuant to this Debenture (and the Company believes,
in good faith, that such effectiveness will continue uninterrupted for the foreseeable future) or (ii) all of the Conversion Shares
issuable pursuant to this Debenture (and shares issuable in lieu of cash payments of interest) may be resold pursuant to Rule
144 without volume or manner-of-sale restrictions as determined by the counsel to the Company as set forth in a written opinion
letter to such effect, addressed and acceptable to the Transfer Agent and the Holder, (d) the Common Stock is trading on a Trading
Market and all of the shares issuable pursuant to this Debenture are listed or quoted for trading on such Trading Market (and
the Company believes, in good faith, that trading of the Common Stock on a Trading Market will continue uninterrupted for the
foreseeable future), (e) there is a sufficient number of authorized but unissued and otherwise unreserved shares of Common Stock
for the issuance of all of the shares then issuable pursuant to this Debenture, (f) there is no existing Event of Default and
no existing event which, with the passage of time or the giving of notice, would constitute an Event of Default, (g) the issuance
of the shares in question to the Holder would not violate the limitations set forth in Section 4(d) herein, (h)
there has been no public announcement of a pending or proposed Fundamental Transaction or Change of Control Transaction that has
not been consummated, (i) the applicable Holder is not in possession of any information provided by the Company that constitutes,
or may constitute, material non-public information, and (j) the Company has timely filed (or obtain extensions in respect
thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant
to the Exchange Act.

 

    	3

    	 

    

 

“Event
of Default” shall have the meaning set forth in Section 6(a).

  

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

 

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

 

“Mandatory
Default Amount” means the payment of 125% of the outstanding principal amount of this Debenture and accrued and unpaid
interest hereon, in addition to the payment of all other amounts, costs, expenses and liquidated damages due in respect of this
Debenture.

 

“New
York Courts” shall have the meaning set forth in Section 7(d).

 

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

 

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

 

“Registration
Statement” means a registration statement covering the resale of the Underlying Shares by each Holder.

 

“Securities”
means the Debentures and the Underlying Shares.

 

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

 

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

 

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

 

“Underlying
Shares” means the shares of Common Stock issued and issuable upon conversion or redemption of the Debentures and issued
and issuable in lieu of the cash payment of interest on the Debentures in accordance with the terms hereof.

 

Section 2.            Amortization
and Interest.

 

a)             Payment of Interest in Cash or Kind. The Company shall pay interest to the Holder on the
aggregate unconverted and then outstanding principal amount of this Debenture at the rate of 8% per annum. All interest payments
hereunder will be payable in cash, or subject to the Equity Conditions, in cash or common stock in the Company’s discretion.

 

    	4

    	 

    

 

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

 

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

 

d)             Prepayment.
At any time upon thirty (30) days written notice to the Holder, the Company may prepay any portion of the principal amount of this
Debenture and any accrued and unpaid interest, without penalty. The Holder may continue to convert the Debenture from the date
notice of the prepayment is given until the date of the prepayment.

 

e)            Warrants.
Holder shall be entitled to receive a warrant, exercisable for a period of five (5) years from the date of grant, to purchase an
amount of Common Stock equal to 50% of the principal sum under this Debenture on the date hereof at an exercise price equal to
200% of the applicable Conversion Price. The terms of the Warrant shall be set forth in a separate Warrant Agreement to be entered
into between the Company and the Holder.

 

Section 3.              Registration
of Transfers and Exchanges; Holder Representations.

 

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

 

b)            Investment
Representations. The Holder represents as follows:

 

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

 

    	5

    	 

    

 

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

 

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

 

4.              General Solicitation. The Holder
is not purchasing the Securities as a result of any advertisement, article, notice or other communication regarding the Securities
published in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or any
other general solicitation or general advertisement.

 

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

 

d)             Registration
Rights. The Company will file a Registration Statement on Form S-1 covering the resale of the Common Shares underlying the
Debenture, and the shares issuable in lieu of cash payments of interest, as soon as possible after the date hereof, but in no event
later than March 2, 2015, or as soon as practicable following the restatement and refiling of the Company’s amended financials,
and shall use its best efforts to cause the Registration Statement to become effective as soon as possible, but in any event, within
seventy-five (75) calendar days from the hereof (if there is no SEC review), or ninety (90) calendar days from the date hereof
(if there is SEC review) or as soon as practicable following the restatement and refiling of the Company’s amended financials.
Holder agrees, if requested by the Company or any underwriter, to a market stand-off for not more than 180 days, provided that
the Board members and executive officers of the Company have been requested to agree to the same stand-off terms.

 

e)             Transfer Restrictions. The Securities may only be disposed of in compliance with state and
federal securities laws.

 

    	6

    	 

    

 

Section 4.              Conversion.

 

a)            Voluntary Conversion. At any time after the Original Issue Date until this Debenture is no
longer outstanding, this Debenture shall be convertible, in whole or in part, into shares of Common Stock at the option of the
Holder, at any time and from time to time (subject to the conversion limitations set forth in Section 4(d) hereof). The Holder
shall effect conversions by delivering to the Company a Notice of Conversion, the form of which is attached hereto as Annex
A (each, a “Notice of Conversion”), specifying therein the principal amount of this Debenture to be converted
and the date on which such conversion shall be effected (such date, the “Conversion Date”). If no Conversion
Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion is deemed delivered
hereunder. No ink-original Notice of Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee
or notarization) of any Notice of Conversion form be required. To effect conversions hereunder, the Holder shall not be
required to physically surrender this Debenture to the Company unless the entire principal amount of this Debenture, plus all accrued
and unpaid interest thereon, has been so converted. Conversions hereunder shall have the effect of lowering the outstanding principal
amount of this Debenture in an amount equal to the applicable conversion. The Holder and the Company shall maintain records showing
the principal amount(s) converted and the date of such conversion(s). The Company may deliver an objection to any Notice of Conversion
within one (1) Business Day of delivery of such Notice of Conversion. In the event of any dispute or discrepancy, the records of
the Holder shall be controlling and determinative in the absence of manifest error. The Holder, and any assignee by acceptance
of this Debenture, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion
of this Debenture, the unpaid and unconverted principal amount of this Debenture may be less than the amount stated on the face
hereof.

 

b)            Conversion
Price. The Conversion Price of this Debenture (the “Conversion Price”) shall be (i) 85% of the volume-weighted
average price of the Common Stock for the thirty Trading Days prior to the date the Notice of Conversion is provided or (ii) 85%
of the per share price of the Company’s next common stock offering on or before the maturity of this Debenture for aggregate
sale proceeds of not less than $2 million, in the event the Holder converts upon the closing of such offering. All such determinations
will be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction
that proportionately decreases or increases the Common Stock during such measuring period. Nothing herein shall limit a Holder’s
right to pursue actual damages or declare an Event of Default pursuant to Section 6 hereof and the Holder shall have the right
to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance
and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant
to any other Section hereof or under applicable law. 

 

		c)	Mechanics of Conversion.

 

i.              Conversion Shares Issuable Upon Conversion of Principal Amount. The number of Conversion
Shares issuable upon a conversion hereunder shall be determined by the quotient obtained by dividing (x) the outstanding principal
amount of this Debenture to be converted by (y) the Conversion Price.

 

    	7

    	 

    

 

ii.              Delivery of Certificate Upon Conversion. Not later than two (2) Trading Days after each
Conversion Date (the “Share Delivery Date”), the Company shall deliver, or cause to be delivered, to the Holder
(A) a certificate or certificates representing the Conversion Shares which, on or after the date on which such Conversion Shares
are eligible to be sold under Rule 144 without the need for current public information and the Company has received an opinion
of counsel to such effect reasonably acceptable to the Company (which opinion the Company will be responsible for obtaining) shall
be free of restrictive legends and trading restrictions representing the number of Conversion Shares being acquired upon the conversion
of this Debenture, and (B) a bank check in the amount of accrued and unpaid interest (if the Company has elected or is required
to pay accrued interest in cash). All certificate or certificates required to be delivered by the Company under this Section 4(d)
shall be delivered electronically through the Depository Trust Company or another established clearing corporation performing similar
functions. If the Conversion Date is prior to the date on which such Conversion Shares are eligible to be sold under Rule 144 without
the need for current public information the Conversion Shares shall bear a restrictive legend in the following form, as appropriate:

 

“NEITHER THE ISSUANCE
AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE 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 (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN
A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS 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.”

 

Notwithstanding the foregoing,
commencing on such date that the Conversion Shares are eligible for sale under Rule 144 subject to current public information requirements,
the Company, upon request of the Holder, shall obtain a legal opinion to allow for such sales under Rule 144.

 

    	8

    	 

    

 

iii.             Failure
to Deliver Certificates. If, in the case of any Notice of Conversion, such certificate or certificates are not delivered to
or as directed by the applicable Holder by the Share Delivery Date, the Holder shall be entitled to elect by written notice to
the Company at any time on or before its receipt of such certificate or certificates, to rescind such Conversion, in which event
the Company shall promptly return to the Holder any original Debenture delivered to the Company and the Holder shall promptly return
to the Company the Common Stock certificates issued to such Holder pursuant to the rescinded Conversion Notice.

 

iv.            Obligation
Absolute; Partial Liquidated Damages. The Company’s obligations to issue and deliver the Conversion Shares upon conversion
of this Debenture in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by
the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against
any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach
or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law
by the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation of the
Company to the Holder in connection with the issuance of such Conversion Shares; provided, however, that such delivery
shall not operate as a waiver by the Company of any such action the Company may have against the Holder. In the event the Holder
of this Debenture shall elect to convert any or all of the outstanding principal or interest amount hereof, the Company may not
refuse conversion based on any claim that the Holder or anyone associated or affiliated with the Holder has been engaged in any
violation of law, agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining and or
enjoining conversion of all or part of this Debenture shall have been sought and obtained, and the Company posts a surety bond
for the benefit of the Holder in the amount of 150% of the outstanding principal amount of this Debenture, which is subject to
the injunction, which bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and
the proceeds of which shall be payable to the Holder to the extent it obtains judgment. In the absence of such injunction, the
Company shall issue Conversion Shares or, if applicable, cash, upon a properly noticed conversion. If the Company fails for any
reason to deliver to the Holder such certificate or certificates pursuant to Section 4(c)(ii) by the Share Delivery Date, the Company
shall pay to the Holder, in cash, as liquidated damages and not as a penalty, $1,000 per Trading Day for each Trading Day after
such Share Delivery Date until such certificates are delivered or Holder rescinds such conversion. Nothing herein shall limit a
Holder’s right to pursue actual damages or declare an Event of Default pursuant to Section 6 hereof for the Company’s
failure to deliver Conversion Shares within the period specified herein and the Holder shall have the right to pursue all remedies
available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive
relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section
hereof or under applicable law.

 

    	9

    	 

    

 

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

 

    	10

    	 

    

 

vi.            Reservation
of Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available out of its authorized
and unissued shares of Common Stock a number of shares of Common Stock at least equal to 200% of the Required Minimum for
the sole purpose of issuance upon conversion of this Debenture and payment of interest on this Debenture, each as herein provided,
free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holder (and the other holders
of the Debentures), not less than such aggregate number of shares of the Common Stock as shall (subject to the terms and conditions
set forth in the Purchase Agreement) be issuable (taking into account the adjustments and restrictions of Section 5) upon the conversion
of the then outstanding principal amount of this Debenture and payment of interest hereunder. The Company covenants that all shares
of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable,
and, at such times as the Registration Statement covering such shares is then effective under the Securities Act, will be registered
for public resale in accordance with such Registration Statement.

 

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

 

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

 

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d)           Holder’s
Conversion Limitations. The Company shall not effect any conversion of principal and/or interest of this Debenture, and a
Holder shall not have the right to convert any principal and/or interest of this Debenture, to the extent that after giving effect
to the conversion set forth on the applicable Notice of Conversion, the Holder (together with the Holder’s Affiliates, and
any 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 Debenture with respect to which such determination is being made, but shall exclude the number of shares
of Common Stock which are issuable upon (i) conversion of the remaining, unconverted principal amount of this Debenture 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 subject to a limitation on conversion or exercise analogous to the limitation contained herein
(including, without limitation, any other Debentures or the Warrants) 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. To the extent that the
limitation contained in this Section 4(d) applies, the determination of whether this Debenture is convertible (in relation to
other securities owned by the Holder together with any Affiliates) and of which principal amount of this Debenture is convertible
shall be in the sole discretion of the Holder, and the submission of a Notice of Conversion shall be deemed to be the Holder’s
determination of whether this Debenture may be converted (in relation to other securities owned by the Holder together with any
Affiliates) and which principal amount of this Debenture is convertible, in each case subject to the Beneficial Ownership Limitation.
To ensure compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a Notice
of Conversion that such Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall
have no obligation to verify or confirm the accuracy of such determination. In
addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of
the Exchange Act and
the rules and regulations promulgated thereunder. For purposes
of this Section 4(e), in determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding
shares of Common Stock as stated in the most recent of the following: (i) the Company’s most recent periodic or annual report
filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company, or (iii) a more recent written
notice by the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding. 
Upon the written or oral request of a Holder, the Company shall within two Trading Days confirm orally and in writing to the Holder
the number of shares of Common Stock then outstanding.  In any case, the number of outstanding shares of Common Stock shall
be determined after giving effect to the conversion or exercise of securities of the Company, including this Debenture, 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 Debenture held by the Holder. The Holder, upon
not less than 61 days’ prior notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions
of this Section 4(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 Debenture
held by the Holder and the Beneficial Ownership Limitation 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
Beneficial Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise than in
strict conformity with the terms of this Section 4(d) to correct this paragraph (or any portion hereof) which may be defective
or inconsistent with the intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitations contained
in this paragraph shall apply to a successor holder of this Debenture.

 

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Section 5.              Certain
Adjustments.

 

a)             Stock
Dividends and Stock Splits. If the Company, at any time while this Debenture is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any Common Stock Equivalents
(which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon conversion of, or payment
of interest on, the Debentures), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines
(including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues,
in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the Company, then the Conversion
Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding any treasury
shares of the Company) outstanding immediately before such event, and of which the denominator shall be the number of shares of
Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section shall become effective immediately
after the record date for the determination of 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
Rights Offerings. In addition to any adjustments pursuant to Section 5(a) above, if at any time the Company grants, issues
or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to 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 Debenture (without regard
to any limitations on exercise 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).

 

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c)            Intentionally
Omitted.

 

d)           Fundamental
Transaction. If, at any time while this Debenture is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person whereby such other Person acquires more than 50% of the
outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or
party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other
business combination) (each a “Fundamental Transaction”), then, upon any subsequent conversion of this Debenture,
the Holder shall have the right to receive, for each Conversion Share that would have been issuable upon such conversion immediately
prior to the occurrence of such Fundamental Transaction (without regard to any limitation in Section 4(e) on the conversion of
this Debenture), the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the
surviving corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result
of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Debenture is convertible immediately
prior to such Fundamental Transaction (without regard to any limitation in Section 4(d) on the conversion of this Debenture). 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 (1) 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 Debenture following such Fundamental Transaction. The
Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor
Entity”) to assume in writing all of the obligations of the Company under this Debenture and the other Transaction Documents
(as defined in the Purchase Agreement) in accordance with the provisions of this Section 5(e) pursuant to written agreements in
form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such
Fundamental Transaction and shall, at the option of the holder of this Debenture, deliver to the Holder in exchange for this Debenture
a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Debenture
which is convertible for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent
to the shares of Common Stock acquirable and receivable upon conversion of this Debenture (without regard to any limitations on
the conversion of this Debenture) prior to such Fundamental Transaction, and with a conversion price which applies the conversion
price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant
to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such
conversion price being for the purpose of protecting the economic value of this Debenture immediately prior to the consummation
of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence
of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the
date of such Fundamental Transaction, the provisions of this Debenture and the other Transaction Documents referring to the “Company”
shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the
obligations of the Company under this Debenture and the other Transaction Documents with the same effect as if such Successor Entity
had been named as the Company herein.

 

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

 

f)             Notice
to the Holder.

 

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

 

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

 

Section 6.            Events of Default.

 

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

 

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

  

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ii.             the
Company shall materially fail to observe or perform any other covenant or agreement contained in the Debentures (other than a breach
by the Company of its obligations to deliver shares of Common Stock to the Holder upon conversion, which breach is addressed in
clause (xi) below) which failure is not cured, if possible to cure, within the earlier to occur of (A) 5 Trading Days after notice
of such failure sent by the Holder or by any other Holder to the Company and (B) 10 Trading Days after the Company has become or
should have become aware of such failure;

 

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

 

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

 

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

 

vi.           the Company or any Subsidiary shall default on any of its obligations under any mortgage, credit
agreement or other facility, indenture agreement, factoring agreement or other instrument under which there may be issued, or by
which there may be secured or evidenced, any indebtedness for borrowed money or money due under any long term leasing or factoring
arrangement that (a) involves an obligation greater than $50,000, whether such indebtedness now exists or shall hereafter be created,
and (b) results in such indebtedness becoming or being declared due and payable prior to the date on which it would otherwise become
due and payable;

 

vii.           the
Common Stock shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume
listing or quotation for trading thereon within five Trading Days or the transfer of shares of Common Stock through the Depository
Trust Company System is no longer available or “chilled”;

 

viii.          the
Company shall be a party to any Change of Control Transaction or Fundamental Transaction or shall agree to sell or dispose of all
or in excess of 33% of its assets in one transaction or a series of related transactions (whether or not such sale would constitute
a Change of Control Transaction);

 

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

 

x.              the Company
fails to file with the Commission any required reports under Section 13 or 15(d) of the Exchange Act such that it is not in compliance
with Rule 144(c)(1) (or Rule 144(i)(2), if applicable);

 

xi.             if the
Company or any Significant Subsidiary shall: (i) apply for or consent to the appointment of a receiver, trustee, custodian or liquidator
of it or any of its properties, (ii) admit in writing its inability to pay its debts as they mature, (iii) make a general assignment
for the benefit of creditors, (iv) be adjudicated a bankrupt or insolvent or be the subject of an order for relief under Title
11 of the United States Code or any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or liquidation law
or statute of any other jurisdiction or foreign country, or (v) file a voluntary petition in bankruptcy, or a petition or an answer
seeking reorganization or an arrangement with creditors or to take advantage or any bankruptcy, reorganization, insolvency, readjustment
of debt, dissolution or liquidation law or statute, or an answer admitting the material allegations of a petition filed against
it in any proceeding under any such law, or (vi) take or permit to be taken any action in furtherance of or for the purpose of
effecting any of the foregoing;

 

xii.            if
any order, judgment or decree shall be entered, without the application, approval or consent of the Company or any Significant
Subsidiary, by any court of competent jurisdiction, approving a petition seeking liquidation or reorganization of the Company or
any Subsidiary, or appointing a receiver, trustee, custodian or liquidator of the Company or any Subsidiary, or of all or any substantial
part of its assets, and such order, judgment or decree shall continue unstayed and in effect for any period of sixty (60) days;

 

xiii.            the
occurrence of any levy upon or seizure or attachment of, or any uninsured loss of or damage to, any property of the Company or
any Subsidiary having an aggregate fair value or repair cost (as the case may be) in excess of $100,000 individually or in the
aggregate, and any such levy, seizure or attachment shall not be set aside, bonded or discharged within thirty (30) days after
the date thereof;

 

xiv.           the
Company shall fail to maintain sufficient reserved shares for Conversion; or

 

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xv.            any monetary judgment, writ or similar final process shall be entered or filed against the Company,
any subsidiary or any of their respective property or other assets for more than $50,000, and such judgment, writ or similar final
process shall remain unvacated, unbonded or unstayed for a period of 45 calendar days.

   

b)           Remedies
Upon Event of Default. Subject to the Beneficial Ownership Limitation as set forth in Section 4(d), if any Event of Default
occurs, then the outstanding principal amount of this Debenture, plus accrued but unpaid interest, liquidated damages and other
amounts owing in respect thereof through the date of acceleration, shall become, at the Holder’s election, immediately due
and payable in cash at the Mandatory Default Amount. After the occurrence of any Event of Default that results in the eventual
acceleration of this Debenture, the interest rate on this Debenture shall accrue at an additional interest rate equal to the lesser
of 2% per month (24% per annum) or the maximum rate permitted under applicable law. Upon the payment in full of the Mandatory Default
Amount, the Holder shall promptly surrender this Debenture to or as directed by the Company. In connection with such acceleration
described herein, the Holder need not provide, and the Company hereby waives, any presentment, demand, protest or other notice
of any kind, and the Holder may immediately and without expiration of any grace period enforce any and all of its rights and remedies
hereunder and all other remedies available to it under applicable law. Such acceleration may be rescinded and annulled by Holder
at any time prior to payment hereunder and the Holder shall have all rights as a holder of the Debenture until such time, if any,
as the Holder receives full payment pursuant to this Section 6(b). No such rescission or annulment shall affect any subsequent
Event of Default or impair any right consequent thereon.

 

Section 7.            Miscellaneous.

 

a)            Notices.
Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without limitation,
any Notice of Conversion, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight
courier service, addressed to the Company, at the address set forth above, or such other facsimile number or address as the Company
may specify for such purposes by notice to the Holder delivered in accordance with this Section 7(a). Any and all notices or other
communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile,
or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number or address of the
Holder appearing on the books of the Company, or if no such facsimile number or address appears on the books of the Company, at
the principal place of business of such Holder, as set forth in the Purchase Agreement. Any notice or other communication or deliveries
hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto prior to 12:00 p.m. (New York
City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered
via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading Day or later
than 12:00 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by
U.S. nationally recognized overnight courier service or (iv) upon actual receipt by the party to whom such notice is required to
be given.

 

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

 

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

 

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

 

    	20

    	 

    

 

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

 

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

 

g)            Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief.  The
remedies provided in this Debenture shall be cumulative and in addition to all other remedies available under this Debenture at
law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the
Holder’s right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this
Debenture.  The Company covenants to the Holder that there shall be no characterization concerning this instrument other than
as expressly provided herein. Amounts set forth or provided for herein with respect to payments, 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 such breach or any such threatened breach, without the necessity of showing
economic loss and without any bond or other security being required. The Company shall provide all information and documentation
to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with the terms and
conditions of this Debenture.

 

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

 

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

 

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

 

(Signature Pages Follow)

 

    	22

    	 

    

 

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

 

	 	MEDBOX, inc.
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	Facsimile No. for delivery of Notices: _______________

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