Document:

Exhibit 4.1

 

FORM OF NOTE

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.

THIS NOTE DOES NOT REQUIRE PHYSICAL
SURRENDER OF THE NOTE IN THE EVENT OF A PARTIAL REDEMPTION OR CONVERSION. AS A RESULT, FOLLOWING ANY REDEMPTION OR CONVERSION OF
ANY PORTION OF THIS NOTE, THE OUTSTANDING PRINCIPAL SUM REPRESENTED BY THIS NOTE MAY BE LESS THAN THE PRINCIPAL SUM AND ACCRUED
INTEREST SET FORTH BELOW.

 

Original Issue Date: [the Effective Date of the Exchange
Agreement]

$1,831,862.50

19%
SENIOR SECURED CONVERTIBLE NOTE

 

THIS 19% SENIOR SECURED CONVERTIBLE NOTE is being issued
as one or a series of duly authorized and validly issued 19% Senior Secured Convertible Notes issued by Guided Therapeutics, Inc.,
a Delaware corporation (the “Company”) (this note, the “Note” and, collectively with the other notes of
such series, the “Notes”).

 

FOR VALUE
RECEIVED, the Company promises to pay to GPB Debt Holdings II LLC or its registered assigns (the “Holder”), or shall
have paid pursuant to the terms hereunder, the principal sum of $1,831,862.50 (“Original Principal Amount”) on February
12, 2018 (the “Maturity Date”) or such earlier date as this Note is required or permitted to be repaid as provided
hereunder, and to pay interest to the Holder on the aggregate unconverted and then outstanding principal amount of this Note in
accordance with the provisions hereof. This Note is subject to the following additional provisions:

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

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

“Amortization
Payment” shall have the meaning set forth in Section 2(b).

“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, or (f) 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.

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

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

“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any
day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

“Buy-In”
shall have the meaning set forth in Section 4(c)(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 50% of the voting securities of the Company (other than by means of conversion, exercise or exchange of the Notes or the Securities
issued together with the Notes), (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 shareholders of the Company immediately prior to
such transaction own less than 50% 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 shareholders of the Company immediately
prior to such transaction own less than 50% 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.

“Collateral
Agent” means the agent appointed on behalf of the Purchasers in the Security Agreement dated February 12, 2016 by and between
the Company and the Collateral Agent.

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

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

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

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

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

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

“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).

“DWAC”
means the Deposit or Withdrawal at Custodian system at The Depository Trust Company.

“Event
of Default” shall have the meaning set forth in Section 7(a).

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

“Mandatory
Default Amount” means the sum of (a) 120% of the outstanding principal amount of this Note, plus 120% of accrued and unpaid
interest hereon, and (b) all other amounts, costs, expenses and liquidated damages due in respect of this Note.

“New
York Courts” shall have the meaning set forth in Section 8(e).

“Note
Register” shall mean the note register maintained by the Company.

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

“Option
Value” means the value of a Common Stock Equivalent based on the Black Scholes Option Pricing model obtained from the "OV"
function on Bloomberg determined as of (A) the Trading Day prior to the public announcement of the issuance of the applicable Common
Stock Equivalent, if the issuance of such Common Stock Equivalent is publicly announced or (B) the Trading Day immediately following
the issuance of the applicable Common Stock Equivalent if the issuance of such Common Stock Equivalent is not publicly announced,
for pricing purposes and reflecting (i) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to
the remaining term of the applicable Common Stock Equivalent as of the applicable date of determination, (ii) an expected volatility
equal to the greater of 100% and the 100 day volatility obtained from the HVT function on Bloomberg as of (A) the Trading Day immediately
following the public announcement of the applicable Common Stock Equivalent if the issuance of such Common Stock Equivalent is
publicly announced or (B) the Trading Day immediately following the issuance of the applicable Common Stock Equivalent if the issuance
of such Common Stock Equivalent is not publicly announced, (iii) the underlying price per share used in such calculation shall
be the highest VWAP of the Common Stock during the period beginning on the Trading Day prior to the execution of definitive documentation
relating to the issuance of the applicable Common Stock Equivalent and ending on (A) the Trading Day immediately following the
public announcement of such issuance, if the issuance of such Common Stock Equivalent is publicly announced or (B) the Trading
Day immediately following the issuance of the applicable Common Stock Equivalent if the issuance of such Common Stock Equivalent
is not publicly announced, (iv) a zero cost of borrow and (v) a 360 day annualization factor.

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

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

“Permitted
Indebtedness” means (a) Indebtedness outstanding as of the Original Issue Date, (b) the indebtedness evidenced by the
Notes, and (c) capital lease obligations and purchase money indebtedness incurred in connection with the acquisition of machinery
and equipment and in accordance with the Security Agreement.

“Permitted
Lien” means the individual and collective reference to the following: (a) Liens for taxes, assessments and other governmental
charges or levies not yet due or Liens for taxes, assessments and other governmental charges or levies being contested in good
faith and by appropriate proceedings for which adequate reserves (in the good faith judgment of the management of the Company)
have been established in accordance with GAAP, (b) Liens imposed by Law which were incurred in the ordinary course of the Company’s
business, such as carriers’, warehousemen’s and mechanics’ Liens, statutory landlords’ Liens, and other
similar Liens arising in the ordinary course of the Company’s business, and which (x) do not individually or in the aggregate
materially detract from the value of such property or assets or materially impair the use thereof in the operation of the business
of the Company and its consolidated Subsidiaries or (y) are being contested in good faith by appropriate proceedings, which proceedings
have the effect of preventing for the foreseeable future the forfeiture or sale of the property or asset subject to such Lien,
(c) Liens incurred in connection with Permitted Indebtedness under clauses (a) and (b) of the definition of “Permitted Indebtedness,”
and (d) Liens incurred in connection with Permitted Indebtedness under clause (c) of the definition of “Permitted Indebtedness,”
provided that such Liens are not secured by assets of the Company or its Subsidiaries other than the assets so acquired or leased.

“Purchase
Agreement” means the Securities Purchase Agreement, dated as of February 11, 2016 among the Company and the original Holders,
as amended, modified or supplemented from time to time in accordance with its terms.

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

“Security
Agreement” means the Security Agreement, dated February 12, 2016 by and between the Company and the Collateral Agent.

“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).

“Trading
Day” means a day on which the principal Trading Market is open for trading.

“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the
date in question: the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York
Stock Exchange, or any market of the OTC Markets, Inc. (or any successors to any of the foregoing).

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

Section 2. Interest; Amortization
Payments.

(a) Interest.
Interest shall accrue to the Holder on the aggregate unconverted and then outstanding principal amount of this Note at the rate
of nineteen percent (19%) per annum, calculated on the basis of a 360-day year and shall accrue daily commencing on the Original
Issue Date until payment in full of the outstanding principal (or conversion to the extent applicable), together with all accrued
and unpaid interest, liquidated damages and other amounts which may become due hereunder, has been made. Following an Event of
Default, until such Event of Default has been cured, interest shall accrue at the lesser of (i) the rate of 21% per annum, or (ii)
the maximum amount permitted by law (the lesser of clause (i) or (ii), the “Default Interest Rate”). In the event that
such Event of Default is subsequently cured, the adjustment referred to in the preceding sentence shall cease to be effective as
of the calendar day immediately following the date of such cure; provided that the interest as calculated and unpaid at the Default
Interest Rate during the continuance of such Event of Default shall continue to apply to the extent relating to the days after
the occurrence of such Event of Default through and including the date of such cure of such Event of Default.

(b)
Payments. The Company shall make monthly interest payments (each a “Monthly Payment”) and, beginning on the
one-year anniversary of the Original Issue date,  the
Company shall pay one fifth (1/5) of the unconverted and then outstanding principal amount on the 12th of the following
months: February, 2017; May, 2017; August 2017; November, 2017 and February, 2018 (each such payment, an “Amortization Payment”
and each date on which the Company makes a Monthly Payment or an Amortization Payment, including the Maturity Date, a “Payment
Date”). If any Payment Date is not a Business Day,
then the applicable payment shall be due on the next succeeding Business Day. Each Monthly Payment shall be equal to all accrued
but unpaid interest. Each Amortization Payment shall be equal to one-sixth of the Original Principal Amount of the Note. 

(c) Payment
in Cash. All payments shall be made in cash on any Payment Date.

(d) Prepayment.
The Notes may be prepaid without penalty, in whole or in part, at any time prior to the Maturity Date. In order to prepay the Notes
(or any portion thereof), the Company shall provide 20 days prior written notice to the Holder, during which time the Holder may
convert the Notes in whole or in part at the Conversion Price.

Section 3. Registration
of Transfers and Exchanges.

(a) Different
Denominations. This Note is exchangeable for an equal aggregate principal amount of Notes of different authorized denominations
(of no less than $1,000 in principal amount), as requested by the Holder surrendering the same. No service charge will be payable
for such registration of transfer or exchange.

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

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

Section 4. Conversion.

(a) Voluntary
Conversion. After the Original Issue Date until this Note is no longer outstanding, and provided that that the provisions of
Rule 144 under the Securities Act so permit, this Note shall be convertible, in whole or in part, at any time, and from time to
time, into shares of Common Stock at the option of the Holder. The Holder shall effect conversions by delivering to the Company
a Notice of Conversion, the form of which is attached hereto as Annex A (each, a “Notice of Conversion”),
specifying therein the principal amount of this Note to be converted and the date on which such conversion shall be effected (such
date, the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall
be the date that such Notice of Conversion is deemed delivered hereunder. 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 Note to the Company unless the entire
principal amount of this Note, plus all accrued and unpaid interest thereon, has been so converted. Conversions hereunder shall
have the effect of lowering the outstanding principal amount of this Note in an amount equal to the applicable conversion. The
Holder and the Company shall maintain records showing the principal amount(s) converted in each conversion, the date of each conversion,
and the Conversion Price in effect at the time of each conversion. The Company may deliver an objection to any Notice of Conversion
within one 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 Note, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this
Note, the unpaid and unconverted principal amount of this Note may be less than the amount stated on the face hereof.

(b) Conversion
Price. The “Conversion Price” in effect on any Conversion Date means, as of any Conversion Date or other date of
determination, the lesser of (a) $[*] per share, subject to adjustment as provided in the Note and (b) 70% of the five-day average
closing price of the Common Stock on the five Trading Days immediately preceding the issuance of the Note. The closing price shall
be the closing price reported by Bloomberg L.P. Notwithstanding the foregoing, in no event shall the Conversion Price be less than
the par value of the Common Stock.

(c) Mechanics
of Conversion or Prepayment.

(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 Note to be converted by (y) the
Conversion Price in effect at the time of such conversion.

(ii) Delivery
of Certificate Upon Conversion. Not later than three (3) Trading Days after each Conversion Date (the “Share Delivery
Date”), the Company shall deliver, or cause to be delivered, to the Holder any certificate or certificates required to be
delivered by the Company under this Section 4(c).

(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 Note 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) Partial
Liquidated Damages. 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, for each $1,000 of principal amount being converted, $10 per Trading Day (increasing to $20 per Trading Day on the tenth
Trading Day after such Conversion Date) 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 7 hereof for the Company’s failure to deliver Conversion Shares or, if applicable, cash, 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.

(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 Note 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 Note with respect to which the actual sale price of the Conversion Shares (including any brokerage commissions) giving
rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Company shall
be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the
Holder in respect of the Buy-In and evidence of the amount of such loss.
Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at Law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely
deliver certificates representing shares of Common Stock upon conversion of this Note as required pursuant to the terms hereof.

(vi) Reservation
of Shares Issuable Upon Conversion. The Company covenants that it will reserve and keep available out of its authorized and
unissued shares of Common Stock for the purpose of issuances upon conversion of this Note and the issued with this Note, free from
preemptive rights or any other actual contingent purchase rights of Persons other than the Holder (and the other holders of the
Notes), not less than the amount of shares of Common Stock as shall from time to time be sufficient to effect the conversion of
the outstanding principal amount of this Note; and if at any time the number of authorized but unissued shares of Common Stock
shall be insufficient to effect such conversion, the Company shall take such corporate action as may, in the opinion of its counsel,
be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for
such purpose. The Company covenants that all shares of Common Stock that shall be issuable upon conversion of this Note shall,
upon issue, be duly authorized, validly issued, fully paid and nonassessable.

(vii) Fractional
Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Note. As to
any fraction of a share which 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 Note shall be made without
charge to the Holder hereof for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery
of such certificates, provided that, the Company shall not be required to pay any tax that may be payable in respect of any transfer
involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the Holder of this Note
so converted and the Company shall not be required to issue or deliver such certificates unless or until the Person or Persons
requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid. The Company shall pay all Transfer Agent fees required for same-day processing of any
Notice of Conversion and all fees to the Depository Trust Company (or another established clearing corporation performing similar
functions) required for same-day electronic delivery of the Conversion Shares.

(d) Holder’s
Conversion Limitations. The Company shall not effect any conversion of this Note, and a Holder shall not have the right to
convert any portion of this Note, to the extent that after giving effect to the conversion set forth on the applicable Notice of
Conversion, the Holder (together with the Holder’s Affiliates, and any Persons acting as a group together with the Holder
or any of the Holder’s Affiliates) would beneficially own in excess of the Beneficial Ownership Limitation (as defined below).
For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates
shall include the number of shares of Common Stock issuable upon conversion of this Note with respect to which such determination
is being made, but shall exclude the number of shares of Common Stock which are issuable upon (i) conversion of the remaining,
unconverted principal amount of this Note beneficially owned by the Holder or any of its Affiliates and (ii) exercise or conversion
of the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion or exercise
analogous to the limitation contained herein (including, without limitation, any other Notes 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(d), 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 Note is convertible
(in relation to other securities owned by the Holder together with any Affiliates) and of which principal amount of this Note is
convertible shall be in the sole discretion of the Holder, and the submission of a Notice of Conversion shall be deemed to be the
Holder’s determination of whether this Note may be converted (in relation to other securities owned by the Holder together
with any Affiliates) and which principal amount of this Note is convertible, in each case subject to the Beneficial Ownership Limitation.
To ensure compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a Notice
of Conversion that such Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall
have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status
as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 4(d), 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 SEC, 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
Note, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported.
The “Beneficial Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding immediately
after giving effect to the issuance of shares of Common Stock issuable upon conversion of this Note held by the Holder. The Holder,
upon not less than 61 days’ prior notice to the Company, may increase the Beneficial Ownership Limitation provisions of this
Section 4(d) solely with respect to the Holder’s Note, provided that the Beneficial Ownership Limitation in no event exceeds
9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock
upon conversion of this Note held by the Holder and the provisions of this Section 4(d) 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 Holder may also decrease
the Beneficial Ownership Limitation provisions of this Section 4(d) solely with respect to the Holder’s Note at any time,
which decrease shall be effectively immediately upon delivery of notice 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 Note.

Section 5. Certain
Adjustments.

(a) Stock
Dividends and Stock Splits. If the Company, at any time while this Note is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions payable in shares of Common Stock 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 Notes or pursuant to any of the other Transaction Documents), (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 shareholders entitled
to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination or re-classification.

(b) Subsequent
Equity Sales. If, at any time, for so long as the Note or any amounts accrued and payable thereunder remain outstanding,
the Company or any Subsidiary, as applicable, sells or grants any option to purchase or sells or grants any right to reprice, or
otherwise disposes of or issues, any Common Stock or Common Stock Equivalents entitling any Person to acquire shares of Common
Stock at an effective price per share that is lower than the Conversion Price then in effect (such lower price, the “Base
Conversion Price” and each such issuance a “Dilutive Issuance”), then the Conversion Price shall be immediately
reduced to equal the Base Conversion Price.

If the holder
of Common Stock or Common Stock Equivalents outstanding on the Original Issue Date or issued thereafter shall at any time, whether
by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or
due to warrants, options or rights per share which are issued in connection with such issuance, receive or be entitled to receive
shares of Common Stock at an effective price per share that is lower than the Conversion Price then in effect, such issuance shall
be deemed to have occurred for less than the Conversion Price on such date and such issuance shall be deemed to be a Dilutive Issuance.

If after
any Dilutive Issuance of Common Stock Equivalents, the price per share for which shares of Common Stock may be issuable thereafter
is amended or adjusted, and such price as so amended shall be less than the Conversion Price in effect at the time of such amendment
or adjustment, then the Conversion Price shall be adjusted upon each such issuance or amendment as provided in this Section 5(b).

In case any
Common Stock Equivalent is issued in connection with the issue or sale of other securities of the Company, together comprising
one integrated transaction, (x) the Common Stock Equivalents will be deemed to have been issued for the Option Value of such Common
Stock Equivalents and (y) the other securities issued or sold in such integrated transaction shall be deemed to have been issued
or sold for the difference of (I) the aggregate consideration received by the Company less any consideration paid or payable by
the Company pursuant to the terms of such other securities of the Company, less (II) the Option Value. If any shares of Common
Stock or Common Stock Equivalents are issued or sold or deemed to have been issued or sold for cash, the amount of such consideration
received by the Company will be deemed to be the net amount received by the Company therefor. If any shares of Common Stock or
Common Stock Equivalents are issued or sold for a consideration other than cash, the amount of such consideration received by the
Company will be the fair value of such consideration, except where such consideration consists of publicly traded securities, in
which case the amount of consideration received by the Company will be the VWAP of such public traded securities on the date of
receipt. If any shares of Common Stock or Common Stock Equivalents are issued to the owners of the non-surviving entity in connection
with any merger in which the Company is the surviving entity, the amount of consideration therefor will be deemed to be the fair
value of such portion of the net assets and business of the non-surviving entity as is attributable to such shares of Common Stock
or Common Stock Equivalents, as the case may be.

If the Company
enters into a Variable Rate Transaction despite the prohibition set forth in the Purchase Agreement, the Company shall be deemed
to have issued Common Stock or Common Stock Equivalents at the lowest possible conversion price at which such securities may be
converted or exercised under the terms of such Variable Rate Transaction.

The Company
shall notify the Holder in writing, no later than the Trading Day following the issuance of any Common Stock or Common Stock Equivalents
subject to this Section 5(b), indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion
price and other pricing terms (such notice, the “Dilutive Issuance Notice”). For purposes of clarification, whether
or not the Company provides a Dilutive Issuance Notice pursuant to this Section 5(b), upon the occurrence of any Dilutive Issuance,
the Holder is entitled to receive a number of Conversion Shares based upon the Base Conversion Price on or after the date of such
Dilutive Issuance, regardless of whether the Holder accurately refers to the Base Conversion Price in the Notice of Conversion.

The provisions
of this Section 5(b) shall apply each time a Dilutive Issuance occurs after the Original Issue Date for so long as the Note or
any amounts accrued and payable thereunder remain outstanding, but any adjustment of the Conversion Price pursuant to this Section
5(b) shall be downward only.

Notwithstanding
anything in this Section 5(b), no adjustment will be made under this Section 5(b) in respect of an Exempt Issuance.

(c) 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, 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 Note (without regard to
any limitations on conversion hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the
date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date
as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights
(provided, however, to the extent that the Holder’s right to participate in any such Purchase Right would
result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such
Purchase Right to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to
such extent)).

(d) Pro
Rata Distributions. During such time as this Note is outstanding, if the Company shall declare or make any dividend or other
distribution of its assets or rights or warrants to acquire its assets, or subscribe for or purchase any security other than Common
Stock, to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation, any distribution
of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement,
scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the issuance of this Note,
then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would
have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete conversion of this
Note (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation)
immediately before the date of which a record is taken for such Distribution, 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 participation in such Distribution (provided, however,
to the extent that the Holder's right to participate in any such Distribution would result in the Holder exceeding the Beneficial
Ownership Limitation with respect to the Company or any other publicly-traded corporation subject to Section 13(d) of the Exchange
Act, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of
any shares of Common Stock as a result of such Distribution to such extent)).) and the portion of such Distribution shall be held
in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding
the Beneficial Ownership Limitation with respect to the Company or any other publicly-traded corporation subject to Section 13(d)
of the Exchange Act).).

(e) Fundamental
Transaction. If, at any time while this Note is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, (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 Note, the Holder
shall have the right to receive, for each Conversion Share that would have been issuable upon such conversion immediately prior
to the occurrence of such Fundamental Transaction (without regard to any limitation on the conversion of this Note), the number
of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and
any additional consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction
by a holder of the number of shares of Common Stock for which this Note is convertible immediately prior to such Fundamental Transaction
(without regard to any limitation on the conversion of this Note). For purposes of any such conversion, the determination of the
Conversion Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one (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 Note following such Fundamental Transaction. Notwithstanding anything to the contrary, in the event of a
Fundamental Transaction that is (1) an all cash transaction, (2) a “Rule 13e-3 transaction” as defined in Rule 13e-3
under the Exchange Act, or (3) a Fundamental Transaction involving a person or entity not traded on a Trading Market, the Company
or any Successor Entity (as defined below) shall, at the Holder’s option, exercisable concurrently with the consummation
of the Fundamental Transaction, purchase this Note from the Holder by paying to the Holder the product of (a) the number of Conversion
Shares issuable upon full conversion of this Note (without regard to any limitation on conversion of this Note) and (b) the positive
difference between the cash per share paid in such Fundamental Transaction minus the then in effect Conversion Price. 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 Note and the other Transaction Documents 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 Note, deliver to the Holder in exchange for this Note a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Note which is 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 Note (without regard to any limitations on the conversion of this Note) 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 Note
immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance
to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted
for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and the other Transaction Documents
referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of
the Company and shall assume all of the obligations of the Company under this Note and the other Transaction Documents with the
same effect as if such Successor Entity had been named as the Company herein. Notwithstanding anything in this Section 5(e), an
Exempt Issuance shall not be deemed a Fundamental Transaction.

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

(g) Notice
to the Holder.

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

(ii) Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C)
the Company shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any shareholders 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 Note, and shall cause to be delivered to the Holder at its last address
as it shall appear upon the Note Register, at least ten 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 (as determined in good faith by the Company), the Company
or its successor shall simultaneously file such notice with the SEC pursuant to a Current Report on Form 8-K. The Holder shall
remain entitled to convert this Note during the 20-day period commencing on the date of such notice through the effective date
of the event triggering such notice except as may otherwise be expressly set forth herein.

Section 6. Negative
Covenants. As long as any portion of this Note remains outstanding, unless the holders of a majority in principal amount of
the then outstanding Notes shall have otherwise given prior written consent, the Company shall not, and shall not permit any of
the Subsidiaries to, directly or indirectly:

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

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

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

(d) other
than pursuant to an Exempt Issuance, repay, repurchase or offer to repay, repurchase or otherwise acquire more than a de minimis number
of shares of its Common Stock or Common Stock Equivalents other than as to the Conversion Shares or Warrant Shares as permitted
or required under the Transaction Documents;

(e) repay,
repurchase or offer to repay, repurchase or otherwise acquire any Indebtedness, other than the Notes if on a pro-rata basis, other
than regularly scheduled principal and interest payments as such terms are in effect as of the Original Issue Date, provided that
such payments shall not be permitted if, at such time, or after giving effect to such payment, any Event of Default exist or occur provided, however,
this covenant shall not apply with respect to the exercise of any Holder’s conversion under Section 4;

(f) other
than pursuant to an Exempt Issuance, pay cash dividends or distributions on any equity securities of the Company;

(g) enter
into any transaction with any Affiliate of the Company which would be required to be disclosed in any public filing with the SEC
assuming that the Company is subject to the Securities Act or the Exchange Act, unless such transaction is made on an arm’s-length
basis and expressly approved by a majority of the disinterested directors of the Company (even if less than a quorum otherwise
required for board approval); or

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

Section 7. 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 Note or (B) interest, late fees, liquidated damages and other amounts owing
to a Holder on any Note, as and when the same shall become due and payable (whether on a Conversion Date or the Maturity Date or
by acceleration or otherwise) which default, solely in the case of an interest payment or other default under clause (B) above,
is not cured within three Trading Days;

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

(iii) [RESERVED];

(iv) any representation
or warranty made in this Note, any other Transaction Document, any written statement pursuant hereto or thereto or any other report,
financial statement or certificate made or delivered to the Holder or any other Holder pursuant hereto or thereto 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
$175,000, 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 and such default is not cured
within ten Trading Days;

(vii) the Common
Stock shall not be eligible for listing or quotation for trading on its Trading Market for a period longer than 10 Trading Days;

(viii) the
Company shall have consummated a Change of Control Transaction or/Fundamental Transaction without the Lead Investors consent without
paying in full all amounts owed under the Note at or prior to such consummation; (ix) a final judgment for the payment of money
aggregating in excess of $50,000 is rendered against the Company and/or any of its Subsidiaries and which judgment is not, within
45 days after the entry thereof, bonded, discharged or stayed pending appeal, or is not discharged within 60 days after the expiration
of such stay; provided, however, any judgment that is covered by insurance or an indemnity from a credit-worthy party will not
be included in calculating the amount of the judgment so long as the Company provides the Holder a written statement from such
insurer or indemnity provider (which written statement shall be reasonably satisfactory to the Holder) to the effect that such
judgment is covered by insurance or an indemnity and the Company or such Subsidiary (as the case may be) will receive the proceeds
of such insurance or indemnity within 30 days of the issuance of such judgment.

(x) the Company
shall provide at any time notice to the Holder, including by way of public announcement, of the Company’s intention to not
honor requests for conversions of any Notes in accordance with the terms hereof.

(xi) the Company
materially deviates from the Operating Budget; or

(xii) the Company
fails to employ the chief financial officer or controller as provided for in Section 4.19.

(b) Remedies
Upon Event of Default. If any Event of Default occurs, the outstanding principal amount of this Note, plus accrued but unpaid
interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration, shall become, at the
Holder’s election, immediately due and payable in cash at the Mandatory Default Amount. Upon the payment in full of the Mandatory
Default Amount, the Holder shall promptly surrender this Note to or as directed by the Company. In connection with such acceleration
described herein, the Holder need not provide, and the Company hereby waives, any presentment, demand, protest or other notice
of any kind, and the Holder may immediately and without expiration of any grace period enforce any and all of its rights and remedies
hereunder and all other remedies available to it under applicable Law. Such acceleration may be rescinded and annulled by Holder
at any time prior to payment hereunder and the Holder shall have all rights as a holder of the Note until such time, if any, as
the Holder receives full payment pursuant to this Section 7(b). No such rescission or annulment shall affect any subsequent Event
of Default or impair any right consequent thereon.

(c) Interest
Rate Upon Event of Default. Commencing on the occurrence of any Event of Default and until such Event of Default is cured,
this Note shall accrue interest at an interest rate equal to the Default Interest Rate.

(d) Conversion
Price Upon Event of Default. Commencing on the occurrence of any Event of Default, all amounts due under the Note shall be
increased by 20%.

Section 8. Miscellaneous.

(a) No
Rights as Stockholder Until Conversion. This Note does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the conversion hereof other than as explicitly set forth in Section 4.

(b) Notices.
All notices, offers, acceptance and any other acts under this Agreement (except payment) shall be in writing, and shall be sufficiently
given if delivered to the addressees in person, by Federal Express or similar receipted next business day delivery, as follows:

If to the Company: Guided Therapeutics
Inc.

5835 Peachtree Corners East, Suite D

Norcross, GA 30092

Telephone No.: (770) 242-8723

Facsimile No.: (770) 242-8639

Attention: President

E-mail: president@guidedinc.com

 

with a copy to: Jones Day

1420 Peachtree St. NE, Suite 800

Atlanta, Georgia 30309

Telephone No.: (404) 581-3939

Facsimile No.: (404) 581-8330

Attention: Heith D. Rodman

E-mail: hdrodman@jonesday.com

 

If to Holder: Address on signature page

 

 

with a copy to: Sheppard Mullin

30 Rockefeller Plaza

New York, NY 10112-0015

Telephone No.: (212) 212 634-3096

Facsimile No.: (212) 212 655-1731

Attention: Andrea Cataneo

E-mail: ACataneo@sheppardmullin.com

or to such other address as any
of them, by notice to the other may designate from time to time. Time shall be counted to, or from, as the case may be, the date
of delivery.

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

(d) Lost
or Mutilated Note. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange
and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed
Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed, but only upon receipt of evidence
of such loss, theft or destruction of such Note, and of the ownership hereof, reasonably satisfactory to the Company. The
applicant for a new Note under such circumstances shall also pay any reasonable third-party costs (including customary indemnity)
associated with the issuance of the new Note.

(e) Exclusive
Jurisdiction; Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Note
shall be governed by and construed and enforced in accordance with the internal laws of the State of 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 by any of the Transaction Documents (whether brought against a party hereto or its
respective Affiliates, directors, officers, shareholders, employees or agents) shall only be commenced in the state and federal
courts sitting in New York, New York (the “New York Courts”). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to
the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue for such proceeding. Each
party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding
by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of
process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other
manner permitted by applicable Law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable
Law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Note or the transactions contemplated
hereby.

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

(g) Severability.
If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, as long as
the essential terms and conditions of this Note for each party remain valid, binding, and enforceable. 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.

(h) Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Note shall be cumulative
and in addition to all other remedies available under this Note and any of the other Transaction Documents at Law or in equity
(including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s
right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Note. Amounts
set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts
to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company
(or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable
harm to the Holder and that the remedy at Law for any such breach would 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 reasonably
requested by the Holder to enable the Holder to confirm the Company’s compliance with the terms and conditions of this Note.

(i) 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.

 

(Signature
Page Follows)

 

 

 

 

 

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

 

 

 

 

	 	GUIDED THERAPEUTICS, INC.
	 	 
	 	 
	 	 
	 	By: 
	 	Name: Gene Cartwright
	 	Title: CEO

 

 

 

 

 

 

 

 

ANNEX A

NOTICE OF CONVERSION

 

The undersigned
hereby elects to convert principal under the 10% Senior Convertible Note due ________ ___, 2018 issued by Guided Therapeutics,
Inc., a Delaware corporation (the “Company”), into shares of common stock (the “Common Stock”), of the
Company according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in the name
of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering
herewith such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged
to the holder for any conversion, except for such transfer taxes, if any.

 

By the delivery
of this Notice of Conversion the undersigned represents and warrants to the Company that its ownership of the Common Stock does
not exceed the amounts specified under Section 4 of this Note, as determined in accordance with Section 13(d) of the Exchange Act.

 

The undersigned
agrees to comply with the prospectus delivery requirements under the applicable securities laws in connection with any transfer
of the aforesaid shares of Common Stock.

 

Conversion calculations:

Date to Effect Conversion:

 

Principal Amount of Note to be Converted:

 

Payment of Interest in Common
Stock __ yes __ no

If yes, $_____ of Interest Accrued
on Account of Conversion at Issue.

 

Number of shares of Common
Stock to be issued:

 

 

Signature:

Name:

 

 

           DWAC
Instructions:

 

                    Broker
No: _____________________________

Account No:  ______________________________

 

 

 

 

 

Schedule 1

CONVERSION SCHEDULE

 

The 10% Senior Convertible Note due
on __________ ___, 2018 in the original principal amount of $____________ are issued by Guided Therapeutics, Inc., a Delaware corporation.
This Conversion Schedule reflects conversions made under Section 4 of the above referenced Note.

 

Dated:

 

 

 

	
         

        Date of Conversion

        (or for first entry, Original Issue Date)
	
         

        Amount of Converted Principal
	
         

        Aggregate Principal Amount Remaining
        Subsequent to Conversion

        (or original Principal Amount)
	
         

        Applicable Conversion Price
	
         

        Company AttestExhibit 10.1 

 

EXCHANGE AGREEMENT

 

THIS EXCHANGE AGREEMENT (the
“Agreement”) is dated as of December 7, 2016, by and between Guided Therapeutics, Inc. Delaware corporation
(the “Company”), and GPB Debt Holdings II, LLC (the “Investor”).

 

WHEREAS:

A. On
September 10, 2014, the Company issued a Secured Promissory Note in the principal amount of $1,275,000 (as amended, the “Original
Note”) pursuant to a Note Purchase Agreement, dated September 10, 2014;

B. Pursuant
to an Assignment and Assumption Agreement, the interests in the Original Note were assigned to the Investor and a second person,
and pursuant to an Amendment Agreement, dated February 11, 2016, the Company consented to the assignment and delivered a new note
to each assignee of equal like and tenor to the Original Note, except that each assignee’s note had a principal amount of
50% of the Note’s then outstanding principal balance (each such new note, an “Assigned Original Note”). The outstanding
principal balance of the Investor’s Assigned Original Note as of the date of this Agreement is $306,862.50;

C. Pursuant
to a Securities Purchase Agreement, dated February 11, 2016, between the Company and the Investor, the Company issued to the Investor
a 17% Senior Secured Convertible Note on February 12, 2016 (the “Convertible Note”). The initial outstanding
principal balance of the Convertible Note was $1,437,500. In connection with such issuance, the Company also issued the Investor
a warrant initially exercisable to purchase an aggregate of approximately 179.7 million shares of the Company’s common stock
(the “Warrant”).

D.On
May 26, 2016, in exchange for a cash payment of $87,500 from the Investor, the outstanding principal balance of the Convertible
Note was increased by a like amount. The outstanding principal balance of the Convertible Note as of the date of this Agreement
is $1,525,000.

E.The
Company and the Investor desire to exchange the Investor’s Assigned Original Note and the Convertible Note for a new note
in the principal amount of $1,831,862.50 in the form of Exhibit A (the “New Note” and with this Agreement, the
“Transaction Documents”);

F. The
exchange of the Investor’s Assigned Original Note and Convertible Note for the New Note (the “Exchange”)
is being made in reliance upon the exemption from registration provided by Section 3(a)(9) of the Securities Act of 1933, as amended
(the “1933 Act”).

NOW, THEREFORE,
in consideration of the foregoing premises and the mutual covenants hereinafter contained, the parties hereto agree as follows:

1.EXCHANGE OF ASSIGNED ORIGINAL NOTE AND CONVERTIBLE
NOTE.

1.1 Exchange
of the Assigned Original Note and Convertible Note. Subject to the satisfaction or waiver of the conditions set forth herein
on the date herein concurrent with the execution of this Agreement, in exchange for the Investor’s Assigned Original Note
and the Convertible Note, the Company shall issue the Investor the New Note. Upon the delivery of the New Note to the Investor,
and without any further action by the parties, all of the Investor’s rights, title and interest in both the Assigned Original
Note and the Convertible Note (including any claims the Investor may have against the Company related thereto) shall be relinquished
and the Investor shall have assigned the same to the Company, and each of the Assigned Original Note and the Convertible Note shall
be void and canceled. The Investor shall deliver or cause to be delivered to the Company (or its designee) the Assigned Original
Note and the Convertible Note (or affidavits of lost note, in customary form) as soon as commercially practicable following receipt
of the New Note.

1.2 Upon
consummation of the Exchange, and without further action by the parties, the number of shares issuable upon exercise of the Warrant
shall be adjusted to equal the number of shares then issuable upon full conversion of the New Note (without giving effect to any
beneficial ownership limitations set forth in the terms of the New Note).

1.3The
parties shall consummate the Exchange immediately upon the completion of a financing resulting in at least $1,000,000 in cash proceeds
to the Company.

2. COMPANY
REPRESENTATIONS AND WARRANTIES.

2.1 Authorization
and Binding Obligation. The Company has the requisite power and authority to enter into and perform its obligations under this
Agreement and to enter into the New Note in accordance with the terms hereof and thereof. The execution and delivery of this Agreement
by the Company and the consummation by the Company of the transactions contemplated hereby and thereby, including, without limitation,
the issuance of the New Note and the shares of Common Stock of the Company issuable upon conversion of the New Note (the shares
issuable upon conversion of the New Note are collectively referred to herein as “Conversion Shares” and, with
the New Note, the “Securities”), have been duly authorized by the Company's Board of Directors and no further
filing, consent, or authorization is required by the Company, its Board of Directors or its stockholders. This Agreement has been
duly executed and delivered by the Company, and constitutes the legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their respective terms, except as such enforceability may be limited by general principles
of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting
generally, the enforcement of applicable creditors' rights and remedies and except as rights to indemnification and to contribution
may be limited by federal or state securities laws.

2.2 No
Conflict. The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby (including, without limitation, the issuance of the New Note and the and reservation
for issuance and issuance of the Conversion Shares) will not (i) result in a violation of the articles of incorporation or other
organizational documents of the Company or any of its subsidiaries, any capital stock of the Company or any of its subsidiaries
or bylaws of the Company or any of its subsidiaries, (ii) conflict with, or constitute a default (or an event which with notice
or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, indenture or instrument to which the Company or any of its subsidiaries is a party, or (iii) result
in a violation of any law, rule, regulation, order, judgment or decree (including foreign, federal and state securities laws and
applicable to the Company or any of its subsidiaries or by which any property or asset of the Company or any of its subsidiaries
is bound or affected except, in the case of clause (ii) or (iii) above, to the extent such violations that could not reasonably
be expected to have a material adverse effect on the Company or its subsidiaries.

2.3 Securities
Law Exemptions. Assuming the accuracy of the representations and warranties of the Investor contained herein, the offer and
issuance by the Company of the (i) the New Note are exempt from registration pursuant to the exemption provided by Section 3(a)(9)
of the 1933 Act and (ii) Conversion Shares, when issued will be exempt from registration pursuant to the exemption provided by
Section 4(a)(2) of the 1933 Act.

2.4 Issuance
of Securities. The issuance of the Securities was duly authorized and upon issuance in accordance with the terms of this Agreement,
shall be validly issued, fully paid and non-assessable and free from all taxes, liens, charges and other encumbrances with respect
to the issue thereof. Upon conversion of the New Note, the Conversion Shares, when issued, will be validly issued, fully paid and
nonassessable and free from all preemptive or similar rights, taxes, liens, charges and other encumbrances with respect to the
issue thereof, with the holders being entitled to all rights accorded to a holder of Common Stock.

2.5 Transfer
Taxes. On the date hereof, all share transfer or other taxes (other than income or similar taxes) which are required to be
paid in connection with the issuance of the New Note and the Conversion Shares when issued will be, or will have been, fully paid
or provided for by the Company, and all laws imposing such taxes will be or will have been complied with.

2.6 Disclosure.
The Company confirms that neither it nor any other person acting on its behalf has provided Investor or its agents or counsel with
any information that constitutes or could reasonably be expected to constitute material, non-public information concerning the
Company or any of its subsidiaries, other than the existence of the transactions contemplated by this Agreement and the Transaction
Documents. The Company understands and confirms that Investor will rely on the foregoing representations in effecting transactions
in securities of the Company.

3. INVESTOR’S
REPRESENTATIONS AND WARRANTIES.

As a material
inducement to the Company to enter into this Agreement and consummate the Exchange, the Investor represents, warrants and covenants
with and to the Company as follows:

3.1Authorization
and Binding Obligation. The Investor has the requisite legal capacity, power and authority to enter into, and perform under,
this Agreement. This Agreement has been duly executed and delivered by the Investor, and constitute the legal, valid and binding
obligations of the Investor, enforceable against the Investor in accordance with their respective terms, except as such enforceability
may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally, the enforcement of applicable creditors' rights and remedies and except as rights
to indemnification and to contribution may be limited by federal or state securities laws.

3.2 Beneficial
Owner. (i) the Investor owns, beneficially and of record, good and marketable title to its Assigned Original Note and the Convertible
Note, free and clear of any taxes or encumbrances; (ii) neither the Assigned Original Note nor the Convertible Note is subject
to any transfer restriction, other than the restrictions that each of the Original Note and the Convertible Note has not been registered
under the 1933 Act and, therefore, cannot be resold unless registered under the 1933 Act or in a transaction exempt from or not
subject to the registration requirements of the 1933 Act; (iii) the Investor has not entered into any agreement or understanding
with any person or entity to dispose of its Assigned Original Note or the Convertible Note; and (iv) the Investor will convey to
the Company good and marketable title to the Investor’s Assigned Original Note and the Convertible Note, free and clear of
any security interests, liens, adverse claims, encumbrances, taxes or encumbrances.

3.3Accredited
Investor. Such Investor is an accredited investor as defined in Rule 501(a) of Regulation D, as amended, under the 1933 Act.

3.4Purchase
Entirely for Own Account. The New Note to be received by such Investor hereunder will be acquired for such Investor’s
own account, not as nominee or agent, and not with a view to the resale or distribution of any part thereof in violation of the
1933 Act, and such Investor has no present intention of selling, granting any participation in, or otherwise distributing the same
in violation of the 1933 Act without prejudice, however, to such Investor’s right at all times to sell or otherwise dispose
of all or any part of such Securities in compliance with applicable federal and state securities laws. Nothing contained
herein shall be deemed a representation or warranty by such Investor to hold the New Note or the Conversion Shares for any period
of time. Such Investor is not a broker-dealer registered with the SEC under the Exchange Act of 1934 (the “1934 Act”)
or an entity engaged in a business that would require it to be so registered.

3.5Disclosure
of Information. Such Investor has had an opportunity to receive all information related to the Company requested by it and
to ask questions of and receive answers from the Company regarding the Company, its business and the terms and conditions of the
offering of the Securities. Such Investor acknowledges receipt of copies of the Company’s most recent Annual Report on Form
10-K for its last fiscal year and all other reports filed by the Company pursuant to the 1934 Act since the filing of the 10-K
and prior to the date hereof. Neither such inquiries nor any other due diligence investigation conducted by such Investor shall
modify, amend or affect such Investor’s right to rely on the Company’s representations and warranties contained in
Section 2.

3.6Reliance
on Exemptions. The Investor understands that the New Note is being offered and exchanged in reliance on specific exemptions
from the registration requirements of United States federal and state securities laws and that the Company is relying in part upon
the truth and accuracy of, and the Investor’s compliance with, the representations, warranties, agreements, acknowledgments
and understandings of the Investor set forth herein in order to determine the availability of such exemptions and the eligibility
of the Investor to acquire the New Note.

4. COVENANTS.

4.1 Reasonable
Best Efforts. The Company shall use its reasonable best efforts to timely satisfy each of the conditions to be satisfied by
it as provided in Section 5 of this Agreement. The Investor shall use its reasonable best efforts to timely satisfy each of the
conditions to be satisfied by it as provided in Section 6 of this Agreement.

4.2 Holding
Period. For the purposes of Rule 144 under the 1933 Act (“Rule 144”), the Company acknowledges that the
holding period of the shares of the Conversion Shares may be tacked onto the holding period of the Original Note, and the Company
agrees not to take a position contrary to this Section 4.2. Upon receipt of an opinion of counsel to the Investor, in a form and
from counsel reasonably acceptable to the Company and its transfer agent, the Company agrees to take commercially reasonable efforts
to issue the Common Stock upon conversion of the New Note without restriction, without any restrictive legend, (A) following any
sale of such Conversion Shares pursuant to Rule 144, or (B) if such Conversion Shares are eligible for sale under Rule 144 without
the requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Conversion
Shares and without volume or manner-of-sale restrictions.

4.3 Security
Agreement Filings. The Company acknowledges that the security interest granted pursuant to the Security Agreement between the
Company and the Investor dated February 12, 2016 entered into in connection with the Convertible Note shall also extend to the
New Note. The Company shall immediately take whatever actions reasonably requested by the Investor to perfect and continue the
Investor’s security interest in the Collateral (as defined in the Security Agreement) with respect to the New Note.

4.4 Removal
of Legends.

(a)
The New Note and the Conversion Shares may only be disposed of in compliance with state and federal securities laws. In connection
with any transfer of New Note other than pursuant to an effective registration statement or Rule 144, (provided that the Investor
provides the Company with reasonable assurances (in the form of seller and, if applicable, broker representation letters) that
the Conversion Shares may be sold pursuant to such rule), to the Company or to an affiliate of the Investor, or in connection with
a pledge as contemplated in this Section, the Company may require the transferor thereof to provide to the Company an opinion of
counsel selected by the transferor and reasonably acceptable to the Company and its transfer agent, the form and substance of which
opinion shall be reasonably satisfactory to the Company and its transfer agent, to the effect that such transfer does not require
registration of such transferred security under the 1933 Act.

(b)
The Investor agree to the imprinting, so long as is required by this Section, of a legend on any of the Securities in substantially
the following form:

NEITHER THIS SECURITY NOR
THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAS 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 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. THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN SECURED
BY SUCH SECURITIES.

The Company acknowledges
and agrees that Investor may from time to time pledge pursuant to a bona fide margin agreement with a registered broker-dealer
or grant a security interest in some or all of the Securities to a financial institution that is an “accredited investor”
as defined in Rule 501(a) under the Securities Act and who agrees to be bound by the provisions of this Agreement and, if required
under the terms of such arrangement, such Investor may transfer pledged or secured Securities to the pledgees or secured parties.
Such a pledge or transfer would not be subject to approval of the Company and no legal opinion of legal counsel of the pledgee,
secured party or pledgor shall be required in connection therewith. Further, no notice shall be required of such pledge, but Investor’s
transferee shall promptly notify the Company of any subsequent transfer or foreclosure of such Securities. The Company will not
be responsible for any pledge relating to, or the grant of any security interest in, any Securities or for any agreement, understanding,
or arrangement between any Investor and its pledgee or secured party. At the appropriate Investor’s expense, the Company
will execute and deliver such reasonable documentation as a pledgee or secured party of New Note and/or Conversion Shares as may
be reasonably requested in connection such pledge or transfer.

(c)
The legend set forth in Section 4.4(b) shall be removed and the Company shall issue a certificate without such legend or any other
legend to the holder of the applicable Securities upon which it is stamped or issue to such holder by electronic delivery at the
applicable balance account at the DTC, if: (i) a registration statement covering the resale of such Security is effective under
the Securities Act (provided that, if the Investor is selling pursuant to the effective registration statement registering the
Securities for resale, the holder agrees to only sell such Securities during such time that such registration statement is effective
and not withdrawn or suspended, and only as permitted by such registration statement), (ii) such Securities are sold pursuant to
Rule 144 (if the seller is not an Affiliate of the Company), (iii) such Securities are eligible for sale under Rule 144, without
the requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Conversion
Shares and without volume or manner-of-sale restrictions or (iv) if such legend is not required under applicable requirements of
the Securities Act (including Section 4(a)(1), judicial interpretations and pronouncements issued by the staff of the SEC). Any
fees associated with the removal of such legend shall be borne by the Company. The Company agrees that following such time as such
legend is no longer required under this Section, it will, no later than three Trading Days (a “Trading Day”
being a day on which the principal trading market or exchange on which the Company’s common stock is listed or quoted for
trading, is open for trading) following the delivery by Investor to the Company or the Company’s transfer agent of (x) a
legended certificate representing the Securities (endorsed or with stock powers attached, signatures guaranteed, and otherwise
in form necessary to affect the reissuance and/or transfer), (y) a notice of conversion to effect the conversion of such New Note
in accordance with its terms and an opinion of counsel to the extent required under Section 4.6(a) (such third Trading Day, the
“Legend Removal Date”), deliver or cause to be delivered to the Purchaser or the transferee of the Purchaser,
as applicable, a certificate representing such Securities that is free from all restrictive and other legends. The Company may
not make any notation on its records or give instructions to the Transfer Agent that enlarge the restrictions on transfer set forth
in this Section. Certificates for Conversion Shares subject to legend removal hereunder shall be transmitted by the Transfer Agent
to the Investor by crediting the account of the Investor’s prime broker with the DTC system as directed by the Investor.

4.5 Furnishing
of Information; Registration Rights.

(a)
Until the earliest of the time that the Investor does not own any Securities, the Company shall timely file (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. During such period, if the Company is not required to file reports pursuant to the Exchange
Act, it will prepare and furnish to the Investor and make publicly available in accordance with Rule 144(c) such information as
is required for the Purchasers to sell the Securities under Rule 144.

(b)
At any time during the period commencing from the date hereof and ending at such time that all of the Conversion Shares (assuming
conversion) may be sold without the requirement for the Company to be in compliance with Rule 144(c)(1) and otherwise without restriction
or limitation pursuant to Rule 144, if the Company (i) shall fail for any reason to satisfy the current public information requirement
under Rule 144(c) for a period of more than 30 consecutive days or (ii) has ever been an issuer described in Rule 144(i)(1)(i)
or becomes such an issuer in the future, and the Company shall fail to satisfy any condition set forth in Rule 144(i)(2) for a
period of more than 30 consecutive days (a “Public Information Failure”) then, in addition to such Purchaser’s
other available remedies, the Company shall pay to the Investor, in cash, as partial liquidated damages and not as a penalty, by
reason of any such delay in or reduction of its ability to sell the Conversion Shares, an amount in cash equal to two percent (2.0%)
of the aggregate Conversion Price of New Note(s) on the day of a Public Information Failure and on every thirtieth (30th) day (pro-rated
for periods totaling less than thirty days) thereafter until the earlier of (a) the date such Public Information Failure is cured
and (b) such time that such public information is no longer required for the Investor to transfer or sell the Conversion Shares
pursuant to Rule 144. The payments to which a Purchaser shall be entitled pursuant to this Section are referred to herein as “Public
Information Failure Payments.” Public Information Failure Payments shall be paid on the earlier of (i) the last day of
the calendar month during which such Public Information Failure Payments are incurred and (ii) the third (3rd) business day after
the event or failure giving rise to the Public Information Failure Payments is cured. In the event the Company fails to make Public
Information Failure Payments in a timely manner, such Public Information Failure Payments shall bear interest at the rate of 1.5%
per month (prorated for partial months) until paid in full. Nothing herein shall limit such Purchaser’s right to pursue actual
damages for the Public Information Failure, and such Purchaser shall have the right to pursue all remedies available to it at law
or in equity including, without limitation, a decree of specific performance and/or injunctive relief.

(c)
The Securities shall be deemed “Registrable Securities” for purposes of Section 4.3 of the Securities Purchase Agreement
between the Company and the Investor dated February 12, 2016 entered into in connection with the Convertible Note.

4.6 Integration.
The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined
in Section 2(a)(1) of the 1933 Act) that would be integrated with the offer or sale of the Securities for purposes of the rules
and regulations of any trading market such that it would require shareholder approval prior to the closing of such other transaction
unless shareholder approval is obtained before the closing of such subsequent transaction.

4.7 Securities
Laws Disclosure; Publicity. The Company shall file a Current Report on Form 8-K, including the Transaction Documents as exhibits
thereto, with the SEC within the time required by the Exchange Act. From and after the filing of such report, the Company represents
to the Investor that it shall have publicly disclosed all material, non-public information delivered to the Investor by the Company
or its subsidiary, or any of their respective officers, directors, employees or agents in connection with the transactions contemplated
by the Transaction Documents. In addition, effective upon the filing of such report, the Company acknowledges and agrees that any
and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries
or any of their respective officers, directors, agents, employees or affiliates on the one hand, and the Investor or any of its
affiliates on the other hand, shall terminate. The Company and the Investor shall consult with each other in issuing any other
press releases with respect to the transactions contemplated hereby, and neither the Company nor the Investor shall issue any such
press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press
release of the Investor, or without the prior consent of the Investor, with respect to any press release of the Company, which
consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing
party shall promptly provide the other party with prior notice of such public statement or communication. Notwithstanding the foregoing,
the Company shall not publicly disclose the name of the Investor, or include the name of the Investor in any filing with the SEC
or any regulatory agency or Trading Market, without the prior written consent of the Investor, except (a) as required by federal
securities law in connection with the filing of final Transaction Documents with the SEC and (b) to the extent such disclosure
is required by law or trading market regulations (including FINRA), in which case the Company shall provide the Purchasers with
prior notice of such disclosure permitted under this clause (b). Notwithstanding the foregoing, the Company shall not be required
to submit for review any such disclosure contained in reports filed with the SEC if it shall have previously provided the same
disclosure for review in connection with a previous filing.

4.8Shareholder
Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other person, that the
Investor is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including
any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company,
or that the Investor could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities
under the Transaction Documents or under any other agreement between the Company and the Investor.

4.9
Non-Public Information.

(a)
Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, which shall
be disclosed pursuant to Section 4.7, the Company covenants and agrees that neither it, nor any other person acting on its behalf
will provide Investor or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes,
material non-public information, unless prior thereto the Investor shall have consented to the receipt of such information and
agreed with the Company to keep such information confidential. The Company understands and confirms that the Investor shall be
relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company delivers
any material, non-public information to the Investor without such the Investor’s consent, the Company hereby covenants and
agrees that the Investor shall not have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective
officers, directors, agents, employees or affiliates, or a duty to the Company, any of its Subsidiaries or any of their respective
officers, directors, agents, employees or Affiliates not to trade on the basis of, such material, non-public information, provided
that the Purchaser shall remain subject to applicable law. To the extent that any notice provided pursuant to any Transaction Document
constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously
file such notice with the SEC pursuant to a Current Report on Form 8-K. The Company understands and confirms that each Purchaser
shall be relying on the foregoing covenant in effecting transactions in securities of the Company.

(b)
Notwithstanding anything to the contrary in Section 4.9(a), for as long as the New Note remains outstanding, the Company shall
provide the Investor with internal monthly (within 10 days), quarterly (within 30 days), and annual (within 45 days) financial
reports (including budget to actual comparisons), as well as monthly A/R and A/P statements.  Additionally, audited annual
financials must be provided to the Investor within 120 days of year end.  Additional information requests such as status updates
on manufacturing and capex, shipment of products, sales pipeline, board decisions, regulatory/licensing, etc. shall not be unreasonably
withheld upon request.  When provided prior to public release, the information provided to the Investor pursuant to this Section
4.9(b) will be deemed to be confidential, material, non-public information, and shall be handled by the Investor as such. Notwithstanding
anything to the contrary in Section 4.9(a), the Company shall have no obligation to publicly disclose such information as a result
of the disclosure of the same to the Investor.

4.10 Indemnification
of Purchasers. Subject to the provisions of this Section, the Company will indemnify and hold Investor and its directors, officers,
shareholders, members, partners, employees and agents (and any other persons with a functionally equivalent role of a person holding
such titles notwithstanding a lack of such title or any other title), each person who controls such Investor (within the meaning
of Section 15 of the 1933 Act and Section 20 of the 1934 Act), and the directors, officers, shareholders, agents, members, partners
or employees (and any other persons with a functionally equivalent role of a person holding such titles notwithstanding a lack
of such title or any other title) of such controlling Persons (each, an “Investor Party”) harmless from any
and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts
paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Investor Party may
suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements
made by the Company in this Agreement or in the other Transaction Documents, (b) any action instituted against the Purchaser Parties
in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not an Affiliate of such
Investor Party, with respect to any of the transactions contemplated by the Transaction Documents (unless such action is based
upon a breach of such Investor Party’s representations, warranties or covenants under the Transaction Documents or any agreements
or understandings such Investor Party may have with any such stockholder or any violations by such Investor Party of state or federal
securities laws or any conduct by such Investor Party which constitutes fraud, gross negligence, willful misconduct or malfeasance)
or (c) any untrue or alleged untrue statement of a material fact contained in any registration statement, any prospectus or any
form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to
any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in
the case of any prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading. If
any action shall be brought against any Investor Party in respect of which indemnity may be sought pursuant to this Agreement,
such Investor Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof
with counsel of its own choosing reasonably acceptable to the Investor Party. Any Investor Party shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be
at the expense of such Investor Party except to the extent that (i) the employment thereof has been specifically authorized by
the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel
or (iii) in such action there is, in the reasonable opinion of counsel, a material conflict on any material issue between the position
of the Company and the position of such Investor Party, in which case the Company shall be responsible for the reasonable fees
and expenses of no more than one such separate counsel. The Company will not be liable to any Investor Party under this Agreement
(y) for any settlement by a Investor Party effected without the Company’s prior written consent, which shall not be unreasonably
withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any
Investor Party’s breach of any of the representations, warranties, covenants or agreements made by such Investor Party in
this Agreement or in the other Transaction Documents. The indemnification required by this Section shall be made by periodic payments
of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity
agreements contained herein shall be in addition to any cause of action or similar right of any Investor Party against the Company
or others and any liabilities the Company may be subject to pursuant to law.

4.11 Reservation
of Common Stock. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available
at all times, free of preemptive rights, shares of Common Stock, subject to adjustment for stock splits and dividends, combinations
and similar events, equal to the amounts required by the Transaction Documents. The Company shall not enter into any agreement
or file any amendment to its certificate of incorporation (including the filing of a Certificate of Designation) which conflicts
with this Section while the New Note and/or the Conversion Shares remain outstanding.

4.12 Trading
of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common Stock on
the trading market on which it is currently listed or quoted. The Company further agrees, if the Company applies to have the Common
Stock traded on any other trading market, it will then include in such application all of the Conversion Shares, and will take
such other action as is necessary to cause all of the Conversion Shares to be listed or quoted on such other trading market as
promptly as possible.

5. CONDITIONS
TO COMPANY’S OBLIGATIONS HEREUNDER.

The obligations
of the Company to the Investor hereunder are subject to the satisfaction of each of the following conditions (except to the extent
such condition is expressly conditional to a specific closing, in which case such condition shall only apply to such specific closing),
provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole
discretion by providing the Investor with prior written notice thereof:

5.1 The
Investor shall have duly executed this Agreement and delivered the same to the Company.

5.2 The
representations and warranties of the Investor shall be true and correct in all material respects as of the date when made and
as the date hereof (except for representations and warranties that speak as of a specific date which shall be true and correct
as of such specified date), and the Investor shall have performed, satisfied and complied in all material respects with the covenants,
agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Investor at or prior to
the date hereof.

5.3No statute,
rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any
court or governmental authority of competent jurisdiction that prohibits the consummation of any of the transactions contemplated
by this Agreement.

6. CONDITIONS
TO INVESTOR’S OBLIGATIONS HEREUNDER.

The obligations
of the Investor hereunder are subject to the satisfaction of each of the following conditions (except to the extent such condition
is expressly conditional to a specific closing, in which case such condition shall only apply to such specific closing), provided
that these conditions are for the Investor’s sole benefit and may be waived by the Investor at any time in its sole discretion
by providing the Company with prior written notice thereof:

6.1The
Company shall have duly executed and delivered this Agreement and the New Note to the Investor.

6.2The
representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as
of the date hereof as though originally made at that time (except for representations and warranties that speak as of a specific
date, which shall be true and correct as of such date) and the Company shall have performed, satisfied and complied in all material
respects with the covenants, agreements and conditions required to be performed, satisfied or complied with by the Company at or
prior to the date hereof.

6.3 The
Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the transactions
contemplated by this Agreement.

6.4 No
statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed
by any court or governmental authority of competent jurisdiction that prohibits the consummation of any of the transactions contemplated
by this Agreement.

6.5The
Company shall have completed a financing resulting in at least $1,000,000 in cash proceeds to the Company.

7. MISCELLANEOUS.

7.1 Approval
of Budgets and Expense Disbursements. For so long as the New Note is outstanding, the Investor will have the right to review
and approve the Company’s budgets and to review and approve any expense disbursements over $10,000, which approvals shall
not be unreasonably withheld, delayed, or conditioned.

7.2 Governing
Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this
Note shall be governed by and construed and enforced in accordance with the internal laws of the State of 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 by any of the Transaction Documents (whether brought against a party hereto or its
respective Affiliates, directors, officers, shareholders, employees or agents) shall only be commenced in the state and federal
courts sitting in New York, New York (the “New York Courts”). Each party hereto hereby irrevocably submits to
the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents),
and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue for such proceeding.
Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such
party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any other manner permitted by applicable Law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by
applicable Law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Note or the transactions
contemplated hereby.

7.4 Headings.
The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this
Agreement.

7.5Severability.
If any provision of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent
jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the
broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect
the validity of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without
material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or
unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations
of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will
endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s),
the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).

7.6 Entire
Agreement; Amendments. This Agreement and the other Transaction Documents supersede all other prior oral or written agreements
between the Investor, the Company, their affiliates and persons acting on their behalf with respect to the matters discussed herein,
and this Agreement, contains the entire understanding of the parties with respect to the matters covered herein and, except as
specifically set forth herein, neither the Company nor Investor makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be amended other than by an instrument in writing signed by the Company
and the Investor, and any amendment to this Agreement made in conformity with the provisions of this Section shall be binding upon
the Investor. No provision hereof may be waived other than by an instrument in writing signed by the party against whom enforcement
is sought.

7.7Notices.
Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must
be in writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent
by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending
party); or (iii) one business day after deposit with an overnight courier service, in each case properly addressed to the party
to receive the same. The addresses and facsimile numbers for such communications shall be:

	 	If to the Company: 	Guided Therapeutics
Inc.	 
	 	 	5835 Peachtree Corners East, Suite D	 
	 	 	Norcross, GA 30092	 
	 	 	Telephone No.: (770) 242-8723	 
	 	 	Facsimile No.: (770) 242-8639	 
	 	 	Attention: President	 
	 	 	E-mail: president@guidedinc.com	 
	 	 	 	 
	 	 	 	 
	 	If to the Investor:	Evan Myrianthopoulos	 
	 	 	535 West 24th Street,
4th Floor	 
	 	 	New York, NY 10011	 
	 	 	Direct: (212) 235-2653	 
	 	 	Fax: (212) 235-2651	 
	 	 	Email: emyrian@gpb-cap.com	 
	 	 	 	 
	 	 	 	 
	 	 	With a copy to:	 
	 	 	 	 
	 	 	 	 
	 	 	Sheppard Mullin Richter &
Hampton LLP	 
	 	 	30 Rockefeller Plaza	 
	 	 	New York, NY 10112-0015	 
	 	 	Email:  acataneo@sheppardmullin.com	 
	 	 	Attention:  Andrea
Cataneo, Esq.	 
	 	 	 	 

 

to its address and email address
set forth above, or to such other address and/or email address and/or to the attention of such other person as the recipient party
has specified by written notice given to each other party five (5) days prior to the effectiveness of such change. Written confirmation
of receipt (A) given by the recipient of such notice, consent, waiver or other communication, (B) electronically generated by the
sender's email program containing the time, date, recipient email address and copy of the message or (C) provided by an overnight
courier service shall be rebuttable evidence of personal service, receipt by email or receipt from an overnight courier service
in accordance with clause (i), (ii) or (iii) above, respectively.

7.8 Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted
assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of
the Investor (other than by operation of law). The Investor may assign any or all of its rights under this Agreement to any person
to whom Investor assigns or transfers any Securities, provided that such transferee agrees in writing to be bound, with respect
to the transferred Securities, by the provisions of the Transaction Documents that apply to the Investor.

7.9Construction.
The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and
no rules of strict construction will be applied against any party. No specific representation or warranty shall limit the generality
or applicability of a more general representation or warranty.

[signature page follows]

 

IN WITNESS
WHEREOF, the Investor and the Company have caused their respective signature pages to this Agreement to be duly executed as
of the date first written above.

	 	COMPANY:
	 	 
	 	GUIDED THERAPEUTICS, INC. 
	 	 
	 	By:/s/ Gene S. Cartwright
	 	Name: Gene S. Cartwright
	 	Title:  CEO
	 	 
	 	 
	 	INVESTOR:
	 	 
	 	GPB DEBT HOLDINGS II LLC
	 	 
	 	 
	 	By: /s/ Evan Myrianthopoulos
	 	Name: Evan Myrianthopoulos
	 	Title: Authorized Signatory

 

 

Exhibit A

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00264-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00264-of-00352.parquet"}]]