Document:

Form of 12% Senior Convertible Note

 Exhibit 4.1 
 THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR APPLICABLE STATE SECURITIES LAWS, AND MAY NOT
BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR RECEIPT BY THE MAKER OF AN OPINION OF COUNSEL IN THE FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE MAKER THAT THIS NOTE AND THE SHARES OF COMMON STOCK
ISSUABLE UPON CONVERSION HEREOF MAY BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF, UNDER AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE SECURITIES LAWS. 
 FLO CORPORATION 
 Senior Convertible Promissory Note 
 due April 3, 2010 
  

				
	 No. CN-08-__
	  	$	___________
	 Dated: April 3, 2008
	  		

 For value received, FLO Corporation, a Delaware corporation (the “Maker”), hereby
promises to pay to the order of                      (together with its successors, representatives, and permitted assigns, the
“Holder”), in accordance with the terms hereinafter provided, the principal amount of              ($
             ), together with interest thereon. Concurrently with the issuance of this Note, the Maker is issuing separate convertible promissory notes (the “Additional
Notes”) to separate purchasers (the “Additional Holders”) in the aggregate principal amount of up to $8,500,000 (inclusive of this Note). 
 All payments under or pursuant to this Note shall be made in United States Dollars in immediately available funds to the Holder at the address of the Holder set forth in the Purchase Agreement (as defined below) or at
such other place as the Holder may designate from time to time in writing to the Maker or by wire transfer of funds to the Holder’s account, instructions for which are attached hereto as Exhibit A. The outstanding principal balance of
this Note shall be due and payable on April 3, 2010 (the “Maturity Date”) or at such earlier time as provided herein. 
 ARTICLE I 
 Section 1.1 Purchase Agreement. This Note has been executed and delivered pursuant to the Note and Warrant
Purchase Agreement dated as of April 3, 2008 (the “Purchase Agreement”), by and among the Maker and the purchasers listed therein. Capitalized terms used and not otherwise defined herein shall have the meanings set forth for
such terms in the Purchase Agreement. 

 Section 1.2 Interest. Beginning on the issuance date of this Note (the “Issuance
Date”), the outstanding principal balance of this Note shall bear interest, in arrears, at a rate per annum equal to twelve percent (12%), payable quarterly commencing on July 1, 2008 and on the first business day of each following
quarter at the option of the Maker in cash or Additional Notes, which shall also each mature on the Maturity Date (the “Ordinary Interest”). Interest shall be computed on the basis of a 360-day year of twelve (12) 30-day months
and shall accrue commencing on the Issuance Date. Furthermore, upon the occurrence of an Event of Default (as defined in Section 2.1 hereof), then to the extent permitted by law, in lieu of the Ordinary Interest, the Maker will pay interest in
cash to the Holder, payable on demand, on the outstanding principal balance of the Note from the date of the Event of Default until such Event of Default is cured at the rate of the lesser of fifteen percent (15%) and the maximum applicable
legal rate per annum. 
 Section 1.3 Payment on Non-Business Days. Whenever any payment to be made shall be due on a Saturday, Sunday
or a public holiday under the laws of the State of New York, such payment may be due on the next succeeding business day and such next succeeding day shall be included in the calculation of the amount of accrued interest payable on such date.

 Section 1.4 Transfer. This Note may be transferred or sold, subject to the provisions of Section 4.8 of this Note, or pledged,
hypothecated or otherwise granted as security by the Holder. 
 Section 1.5 Replacement. Upon receipt of a duly executed, notarized
and unsecured written statement from the Holder with respect to the loss, theft or destruction of this Note (or any replacement hereof) and a standard indemnity, or, in the case of a mutilation of this Note, upon surrender and cancellation of such
Note, the Maker shall issue a new Note, of like tenor and amount, in lieu of such lost, stolen, destroyed or mutilated Note. 
 ARTICLE II

 EVENTS OF DEFAULT; REMEDIES 
 Section 2.1 Events of Default. The occurrence of any of the following events shall be an “Event of Default” under this Note: 
 (a) the Maker shall fail to make any principal or interest payments on the date such payments are due and such default is not fully cured within five (5) business days after the occurrence thereof; or 

(b) the Maker’s notice to the Holder, including by way of public announcement, at any time, of its inability to comply (including for any of the
reasons described in Section 3.8(a) hereof) or its intention not to comply with proper requests for conversion of this Note into shares of Common Stock; or 
  

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 (c) the Maker shall fail to (i) timely deliver the shares of Common Stock upon conversion of the
Note or any interest accrued and unpaid, or (ii) make the payment of any fees and/or liquidated damages under this Note or the other Transaction Documents, which failure in the case of items (i) and (ii) of this Section 2.1(c) is
not remedied within five (5) business days after the incurrence thereof; or 
 (d) default shall be made in the performance or
observance of (i) any material covenant, condition or agreement contained in this Note (other than as set forth in clause (f) of this Section 2.1) and such default is not fully cured within five (5) business days after the Holder
delivers written notice to the Maker of the occurrence thereof or (ii) any material covenant, condition or agreement contained in the Purchase Agreement or any other Transaction Documents which is not covered by any other provisions of this
Section 2.1 and such default is not fully cured within five (5) business days after the Holder delivers written notice to the Maker of the occurrence thereof; or 
 (e) any material representation or warranty made by the Maker herein or in the Purchase Agreement or any other Transaction Documents shall prove to have
been false or incorrect or breached in a material respect on the date as of which made; or 
 (f) the Maker shall (i) apply for or
consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property or assets, (ii) make a general assignment for the benefit of its creditors,
(iii) commence a voluntary case under the United States Bankruptcy Code (as now or hereafter in effect) or under the comparable laws of any jurisdiction (foreign or domestic), (iv) file a petition seeking to take advantage of any
bankruptcy, insolvency, moratorium, reorganization or other similar law affecting the enforcement of creditors’ rights generally, (v) acquiesce in writing to any petition filed against it in an involuntary case under United States
Bankruptcy Code (as now or hereafter in effect) or under the comparable laws of any jurisdiction (foreign or domestic), (vi) issue a notice of bankruptcy or winding down of its operations or issue a press release regarding same, or
(vii) take any action under the laws of any jurisdiction (foreign or domestic) analogous to any of the foregoing; or 
 (g) a proceeding
or case shall be commenced in respect of the Maker, without its application or consent, in any court of competent jurisdiction, seeking (i) the liquidation, reorganization, moratorium, dissolution, winding up, or composition or readjustment of
its debts, (ii) the appointment of a trustee, receiver, custodian, liquidator or the like of it or of all or any substantial part of its assets in connection with the liquidation or dissolution of the Maker or (iii) similar relief in
respect of it under any law providing for the relief of debtors, and such proceeding or case described in clause (i), (ii) or (iii) shall continue undismissed, or unstayed and in effect, for a period of thirty (30) days or any order
for relief shall be entered in an involuntary case under United States Bankruptcy Code (as now or hereafter in effect) or under the comparable laws of any jurisdiction (foreign or domestic) against the Maker or action under the laws of any
jurisdiction (foreign or domestic) analogous to any of the foregoing shall be taken with respect to the Maker and shall continue undismissed, or unstayed and in effect for a period of thirty (30) days; or 
  

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 (h) the failure of the Maker to instruct its transfer agent to remove any legends from shares of Common
Stock eligible to be sold under Rule 144 of the Securities Act and issue such unlegended certificates to the Holder within ten (10) business days of the Holder’s request so long as the Holder has complied with Section 5.1 of the
Purchase Agreement; or 
 (i) the failure of the Maker to pay any other amounts due to the Holder herein or any other Transaction Document,
and not otherwise addressed un this Section 2.1, within five (5) business days of the date such payments are due. 
 Section
2.2 Remedies Upon An Event of Default. If an Event of Default shall have occurred and shall be continuing, the Holder of this Note may at any time at its option, (a) declare the entire unpaid principal balance of this Note, together with
all interest accrued hereon, due and payable, and thereupon, the same shall be accelerated and so due and payable, (b) demand that the principal amount of this Note then outstanding and all accrued and unpaid interest thereon shall be converted
into shares of Common Stock at a Conversion Price per share calculated pursuant to Section 3.1 hereof assuming that the date that the Event of Default occurs is the Conversion Date (as defined in Section 3.1 hereof), or (c) exercise
or otherwise enforce any one or more of the Holder’s rights, powers, privileges, remedies and interests under this Note, the Purchase Agreement or applicable law. No course of delay on the part of the Holder shall operate as a waiver thereof or
otherwise prejudice the right of the Holder. No remedy conferred hereby shall be exclusive of any other remedy referred to herein or now or hereafter available at law, in equity, by statute or otherwise. 
 ARTICLE III 
 CONVERSION; ANTIDILUTION;
PREPAYMENT 
 Section 3.1 Conversion. 
 (a) Optional Conversion. At any time on or after the Issuance Date, this Note shall be convertible (in whole or in part), at the option of the Holder (the “Conversion Option”), into such number
of fully paid and non-assessable shares of Common Stock (the “Conversion Rate”) as is determined by dividing (x) that portion of the outstanding principal balance plus any accrued but unpaid interest under this Note as of such
date that the Holder elects to convert by (y) the Conversion Price (as defined in Section 3.2(a) hereof) then in effect on the date on which the Holder faxes a notice of conversion (the “Conversion Notice”), duly executed,
to the Maker (facsimile number (425) 278-1299, Attn.: Chief Executive Officer, with a copy to facsimile number 206-839-4801, Attn.: W. Michael Hutchings, Esq.) (the “Optional Conversion Date”), provided, however, that the
Conversion Price shall be subject to adjustment as described in Section 3.6 below. The Holder shall deliver this Note to the Maker at the address designated in the Purchase Agreement at such time that this Note is fully converted. With respect
to partial conversions of this Note, the Maker shall keep written records of the amount of this Note converted as of each Conversion Date. 
 (b) Mandatory Conversion. On the Mandatory Conversion Date (as defined below), this Note shall automatically and without any action on the part of the Holder, convert into such number of fully paid and non-assessable shares of Common
Stock as is determined by dividing (x) that portion of the outstanding principal balance plus any accrued but unpaid interest 

  

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under this Note as of the Mandatory Conversion Date by (y) the Conversion Price then in effect on the Mandatory Conversion Date, provided, however, that
the Conversion Price shall be subject to adjustment as described in Section 3.6 below. As used herein, “Mandatory Conversion Date” shall be the first date on or after October 3, 2008 that the Closing Bid Price (as defined below)
of the Common Stock has exceeded $3.00 (as adjusted for stock splits, stock dividends, combinations and similar transactions) for twenty (20) consecutive trading days. The Mandatory Conversion Date and the Voluntary Conversion Date collectively
are referred to in this Note as the “Conversion Date.” Notwithstanding the foregoing to the contrary, the Note shall automatically convert pursuant to this Section 3.1(b) only if (1) the Conversion Shares are eligible to be sold
under Rule 144 of the Securities Act (2) trading in the Common Stock shall not have been suspended by the Securities and Exchange Commission or the OTC Bulletin Board (or other exchange or market on which the Common Stock is trading), and
(3) the Maker is in material compliance with the terms and conditions of this Note and the other Transaction Documents. The term “Closing Bid Price” shall mean, on any particular date, the last closing bid price per share of the
Common Stock on such date quoted on the OTC Bulletin Board or any registered national stock exchange on which the Common Stock is then listed, or if there is no such price on such date, then the last closing bid price on such exchange or quotation
system on the date nearest preceding such date. 
 Section 3.2 Conversion Price. 
 (a) The term “Conversion Price” shall mean $1.00, subject to adjustment under Section 3.6 hereof. 
 Section 3.3 Mechanics of Conversion. 
 (a) Not later than three (3) Trading Days after any Conversion Date, the Maker or its designated transfer agent, as applicable, shall issue and deliver to the Depository Trust Company (“DTC”) account on the
Holder’s behalf via the Deposit Withdrawal Agent Commission System (“DWAC”) as specified in the Conversion Notice, registered in the name of the Holder or its designee, such number of shares of Common Stock to which the Holder
shall be entitled. In the alternative, not later than three (3) Trading Days after any Conversion Date, the Maker shall deliver to the applicable Holder by express courier a certificate or certificates which shall be free of restrictive legends
and trading restrictions (other than those required by Section 5.1 of the Purchase Agreement) representing the number of shares of Common Stock being acquired upon the conversion of this Note (the “Delivery Date”). If in the
case of any Conversion Notice such certificate or certificates are not delivered to or as directed by the applicable Holder by the Delivery Date, the Holder shall be entitled by written notice to the Maker at any time on or before its receipt of
such certificate or certificates thereafter, to rescind such conversion, in which event the Maker shall immediately return this Note tendered for conversion, whereupon the Maker and the Holder shall each be restored to their respective positions
immediately prior to the delivery of such notice of revocation, except that any amounts described in Sections 3.3(b) and (c) shall be payable through the date notice of rescission is given to the Maker. 
  

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 (b) The Maker understands that a delay in the delivery of the shares of Common Stock upon conversion of
this Note beyond the Delivery Date could result in economic loss to the Holder. Subject to Section 3.3(d) hereof, if the Maker fails to deliver to the Holder such shares via DWAC or a certificate or certificates pursuant to this Section
hereunder by the Delivery Date, the Maker shall pay to such Holder, in cash, an amount per Trading Day for each Trading Day until such shares are delivered via DWAC or certificates are delivered, together with interest on such amount at a rate of
10% per annum, accruing until such amount and any accrued interest thereon is paid in full, equal to the greater of (A) (i) 1% of the aggregate principal amount of the Note requested to be converted for the first five (5) Trading
Days after the Delivery Date and (ii) 2% of the aggregate principal amount of the Note requested to be converted for each Trading Day thereafter and (B) $2,000 per day (which amount shall be paid as liquidated damages and not as a
penalty). Except as set forth in Sections 3(c) and 3(d), the remedy provided by this Section 3.3(b) is exclusive and Holder shall have no other right to pursue any remedies available to it at law or in equity (including, without
limitation, a decree of specific performance and/or injunctive relief) arising out of the same occurrence or series of related occurrences that gave rise to this remedy. Notwithstanding anything to the contrary contained herein, the Holder shall be
entitled to withdraw a Conversion Notice, and upon such withdrawal the Maker shall only be obligated to pay the liquidated damages accrued in accordance with this Section 3.3(b) through the date the Conversion Notice is withdrawn. 

(c) Subject to Section 3.3(d) hereof, if the Maker fails to cause its transfer agent to transmit to the Holder a certificate or certificates
representing the shares of Common Stock issuable upon conversion of this Note on or before the Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) shares of Common Stock
to deliver in satisfaction of a sale by the Holder of the shares of Common Stock issuable upon conversion of this Note which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Maker shall (1) pay in cash
to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (A) the number
of shares of Common Stock issuable upon conversion of this Note that the Maker was required to deliver to the Holder in connection with the conversion at issue times (B) the price at which the sell order giving rise to such purchase obligation
was executed, and (2) at the option of the Holder, either reinstate the portion of the Note and equivalent number of shares of Common Stock for which such conversion was not honored or deliver to the Holder the number of shares of Common Stock
that would have been issued had the Maker timely complied with its conversion and delivery obligations hereunder. 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 shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (1) of the immediately preceding sentence the Maker shall be required to pay the Holder $1,000. The
Holder shall provide the Maker written notice indicating the amounts payable to the Holder in respect of the Buy-In, together with applicable confirmations and other evidence reasonably requested by the Maker. The remedy provided by this
Section 3.3(c) is exclusive and Holder shall have no other right to pursue any remedies available to it at law or in equity (including, without limitation, a decree of specific performance and/or injunctive relief) arising out of the same
occurrence or series of related occurrences that gave rise to this remedy. 
  

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 (d) Notwithstanding the foregoing, the remedies provided by Sections 3.3(b) and (c) shall be
exclusive of each other and shall not both be available with respect to any single occurrence or series of related occurrences. If the remedies provided by both Sections 3.3(b) and (c) would otherwise be available with respect to an occurrence
or series of related occurrences, then Holder, in its sole discretion, must elect which one shall apply. Notwithstanding the foregoing, in the event that the Holder is an Insider Purchaser, then subsections (b) and (c) of this
Section 3.3 shall not apply and shall have no force or effect. An “Insider Purchaser” means a Holder who is a director or executive officer of the Maker. 
 Section 3.4 Ownership Cap and Certain Conversion Restrictions. 
 (a) Notwithstanding anything to the
contrary set forth in Section 3 of this Note, but subject to Section 3.4(c) hereof, at no time may the Holder convert all or a portion of this Note if the number of shares of Common Stock to be issued pursuant to such conversion would
exceed, when aggregated with all other shares of Common Stock beneficially owned (as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules thereunder) by the
Holder at such time, the number of shares of Common Stock which would result in the Holder beneficially owning (as determined in accordance with Section 13(d) of the Exchange Act and the rules thereunder) more than 4.9% of all of the Common
Stock outstanding at such time; provided, however, that upon the Holder providing the Maker with sixty-one (61) days notice (pursuant to Section 4.1 hereof) (the “Waiver Notice”) that the Holder would like to
waive this Section 3.4(a) with regard to any or all shares of Common Stock issuable upon conversion of this Note, this Section 3.4(a) will be of no force or effect with regard to all or a portion of the Note referenced in the Waiver
Notice. 
 (b) Notwithstanding anything to the contrary set forth in Section 3 of this Note, but subject to Section 3.4(c) hereof,
at no time may the Holder convert all or a portion of this Note if the number of shares of Common Stock to be issued pursuant to such conversion, when aggregated with all other shares of Common Stock beneficially owned (as determined in accordance
with Section 13(d) of the Exchange Act and the rules thereunder) by the Holder at such time, would result in the Holder beneficially owning (as determined in accordance with Section 13(d) of the Exchange Act and the rules thereunder) in
excess of 9.9% of the then issued and outstanding shares of Common Stock outstanding at such time. 
 (c) In the event the Holder is unable
to fully convert this Note in connection with a conversion election following the delivery of a Maker’s Prepayment Notice pursuant to Section 3.7(k) hereof due to the restrictions set forth in this Section 3.4, such holder may elect
to receive, in lieu of shares of Common Stock, Series C Convertible Preferred Stock of the Company convertible into the number of shares of Common Stock that would have been delivered to such holder but for the limitations set forth in this
Section 3.4(a). The foregoing sentence shall not preclude the Holder from providing a Waiver Notice. In the event the Holder is unable to fully convert this Note in connection with a mandatory conversion pursuant to Section 3.1(b) hereof,
such holder shall receive, in lieu of shares of Common Stock, Series C Convertible Preferred Stock of the Company convertible into the number of shares of Common Stock that would have been delivered to such holder but for the limitations set forth
in this Section 3.4(a). “Series C Convertible Preferred Stock” means a series of non-voting preferred 

  

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stock of the Maker with terms such that a holder thereof shall not be deemed a beneficial owner (as determined in accordance with Section 13(d) of the
Exchange Act and the rules thereunder) of the Common Stock issuable upon conversion thereof, and otherwise with terms similar to the Common Stock. Any determinations as to whether the Holder is unable to fully convert this Note as a result of the
provisions of this Section 3.4 shall be in the sole discretion of the Holder; provided, however, that in the absence of a written notice of such a determination delivered by the Holder to the Maker prior to any event requiring
such a determination, the Maker may make such determination its sole discretion and shall have no liability to Holder for any errors in such determination. 
 Section 3.5 Intentionally Omitted. 
 Section 3.6 Adjustment of Conversion Price. 

(a) The Conversion Price shall be subject to adjustment from time to time as follows: 
 (i) Adjustments for Stock Splits and Combinations. If the Maker shall at any time or from time to time after the Issuance Date,
effect a stock split of the outstanding Common Stock, the applicable Conversion Price in effect immediately prior to the stock split shall be proportionately decreased. If the Maker shall at any time or from time to time after the Issuance Date,
combine the outstanding shares of Common Stock, the applicable Conversion Price in effect immediately prior to the combination shall be proportionately increased. Any adjustments under this Section 3.6(a)(i) shall be effective at the close of
business on the date the stock split or combination occurs. 
 (ii) Adjustments for Certain Dividends and
Distributions. If the Maker shall at any time or from time to time after the Issuance Date, make or issue or set a record date for the determination of holders of Common Stock entitled to receive a dividend or other distribution payable in
shares of Common Stock, then, and in each event, the applicable Conversion Price in effect immediately prior to such event shall be decreased as of the time of such issuance or, in the event such record date shall have been fixed, as of the close of
business on such record date, by multiplying, the applicable Conversion Price then in effect by a fraction: 
 (1) the
numerator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of such issuance or the close of business on such record date; and 
 (2) the denominator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of
such issuance or the close of business on such record date plus the number of shares of Common Stock issuable in payment of such dividend or distribution; 
 provided, however, that if such record date shall have been fixed and such dividend or other distribution is not fully paid or if such dividend or other distribution is not fully made on the date fixed therefor, the Conversion
Price shall be adjusted pursuant to this paragraph as of the time of actual payment of such dividends or distributions. 
  

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 (iii) Adjustment for Other Dividends and Distributions. If the Maker shall at any
time or from time to time after the Issuance Date, make or issue or set a record date for the determination of holders of Common Stock entitled to receive a dividend or other distribution payable in other than shares of Common Stock, then, and in
each event, an appropriate revision to the applicable Conversion Price shall be made and provision shall be made (by adjustments of the Conversion Price or otherwise) so that the holders of this Note shall receive upon conversions thereof, in
addition to the number of shares of Common Stock receivable thereon, the number of securities of the Maker which they would have received had this Note been converted into Common Stock on the date of such event and had thereafter, during the period
from the date of such event to and including the Conversion Date, retained such securities (together with any distributions payable thereon during such period), giving application to all adjustments called for during such period under this
Section 3.6(a)(iii) with respect to the rights of the holders of this Note and the Additional Notes; provided, however, that if such record date shall have been fixed and such dividend is not fully paid or if such distribution is
not fully made on the date fixed therefor, the Conversion Price shall be adjusted pursuant to this paragraph as of the time of actual payment of such dividends or distributions. 
 (iv) Adjustments for Reclassification, Exchange or Substitution. If the Common Stock issuable upon conversion of this Note at any
time or from time to time after the Issuance Date shall be changed to the same or different number of shares of any class or classes of stock, whether by reclassification, exchange, substitution or otherwise (other than by way of a stock split or
combination of shares or stock dividends provided for in Sections 3.6(a)(i), (ii) and (iii), or a reorganization, merger, consolidation, or sale of assets provided for in Section 3.6(a)(v)), then, and in each event, an appropriate revision
to the Conversion Price shall be made and provisions shall be made (by adjustments of the Conversion Price or otherwise) so that the Holder shall have the right thereafter to convert this Note into the kind and amount of shares of stock and other
securities receivable upon reclassification, exchange, substitution or other change, by holders of the number of shares of Common Stock into which such Note might have been converted immediately prior to such reclassification, exchange, substitution
or other change, all subject to further adjustment as provided herein. 
 (v) Adjustments for Reorganization, Merger,
Consolidation or Sales of Assets. If at any time or from time to time after the Issuance Date there shall be a capital reorganization of the Maker (other than by way of a stock split or combination of shares or stock dividends or distributions
provided for in Section 3.6(a)(i), (ii) and (iii), or a reclassification, exchange or substitution of shares provided for in Section 3.6(a)(iv)), or a merger or consolidation of the Maker with or into another corporation where the
holders of outstanding voting securities prior to such merger or consolidation do not own over fifty percent (50%) of the outstanding voting securities of the merged or consolidated entity immediately after such merger or consolidation, or the
sale of all or substantially all of the Maker’s properties or assets to any other person (an “Organic Change”), then as a part of such Organic Change, (A) if the surviving entity in any such Organic Change is a public
company whose common stock is registered pursuant to the Exchange Act of 1934 and its common stock is listed or quoted on a national securities exchange, a national automated quotation system or the OTC Bulletin Board, an appropriate revision to the
Conversion Price shall be made and provision shall be made (by 

  

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adjustments of the Conversion Price or otherwise) so that the Holder shall have the right thereafter to convert such Note into the kind and amount of shares
of stock and other securities or property of the Maker or any successor corporation resulting from Organic Change, and (B) if the surviving entity in any such Organic Change is not a public company whose common stock is registered pursuant to
the Exchange Act or its common stock is not listed or quoted on a national securities exchange, a national automated quotation system or the OTC Bulletin Board, the Holder shall have the right to demand prepayment pursuant to Section 3.7(b)
hereof. In any such case, appropriate adjustment shall be made in the application of the provisions of this Section 3.6(a)(v) with respect to the rights of the Holder after the Organic Change to the end that the provisions of this
Section 3.6(a)(v) (including any adjustment in the applicable Conversion Price then in effect and the number of shares of stock or other securities deliverable upon conversion of this Note and the Additional Notes) shall be applied after that
event in as nearly an equivalent manner as may be practicable. 
 (vi) Adjustments for Issuance of Additional Shares of
Common Stock.  
 (1) In the event the Maker, shall, at any time, from time to time, issue or sell any additional shares
of Common Stock (otherwise than as provided in the foregoing subsections (i) through (v) of this Section 3.6(a) or pursuant to Common Stock Equivalents (hereafter defined) granted or issued prior to the Issuance Date)
(“Additional Shares of Common Stock”), at a price per share less than the Conversion Price then in effect or without consideration, then the Conversion Price upon each such issuance shall be reduced to a price equal to the per share
price paid for such additional shares of Common Stock; provided, however, that, notwithstanding the foregoing, if, subsequent to the Issuance Date and prior to such issuance and sale, the Maker shall have completed an equity or
equity-linked financing with gross proceeds in an amount of at least $10 million at a price of at least $1.00 per share, then the Conversion Price upon each such issuance shall be adjusted to that price (rounded to the nearest cent) determined
by multiplying each of the Conversion Price then in effect by a fraction: 
 (A) the numerator of which shall be equal to the
sum of (x) the number of shares of Common Stock outstanding immediately prior to the issuance of such Additional Shares of Common Stock plus (y) the number of shares of Common Stock (rounded to the nearest whole share) which the
aggregate consideration for the total number of such Additional Shares of Common Stock so issued would purchase at a price per share equal to the Conversion Price then in effect, and 
 (B) the denominator of which shall be equal to the number of shares of Common Stock outstanding immediately after the issuance of such
Additional Shares of Common Stock. 
 (2) The provisions of paragraph (1) of Section 3.6(a)(vi) shall not apply to
any issuance of Additional Shares of Common Stock for which an adjustment is provided under Section 3.6(a)(vii). No adjustment of the Conversion Price shall be made under paragraph (1) of Section 3.6(a)(vi) upon the issuance of any
Additional Shares of Common Stock which are issued pursuant to the exercise of any Common Stock Equivalents, if any such adjustment shall previously have been made upon the issuance of such Common Stock Equivalents pursuant to
Section 3.6(a)(vii). 
  

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 (vii) Issuance of Common Stock Equivalents. If the Maker, at any time after the
Issuance Date, shall issue any securities convertible into or exchangeable for, directly or indirectly, Common Stock (“Convertible Securities”), other than the Promissory Notes, or any rights or warrants or options to purchase any
such Common Stock or Convertible Securities, other than those issued in connection with the issuance of the Note and the Additional Notes (collectively, the “Common Stock Equivalents”), and the aggregate of the price per share for
which Additional Shares of Common Stock may be issuable thereafter pursuant to such Common Stock Equivalent, plus the consideration received by the Maker for issuance of such Common Stock Equivalent divided by the number of shares of Common Stock
issuable pursuant to such Common Stock Equivalent (the “Aggregate Per Common Share Price”) shall be less than the applicable Conversion Price then in effect, or if, after the Issuance Date, the price per share for which Additional
Shares of Common Stock may be issuable thereafter pursuant to any Common Stock Equivalent is amended or adjusted, and such price as so amended shall make the Aggregate Per Share Common Price with respect to such Common Stock Equivalent be less than
the applicable Conversion Price in effect at the time of such amendment or adjustment, then the Conversion Price upon each such issuance or amendment shall be reduced to a price equal to the Aggregate Per Common Share Price; provided,
however, that, notwithstanding the foregoing, if, subsequent to the Issuance Date and prior to such issuance or adjustment, the Maker shall have completed an equity or equity-linked financing with gross proceeds in an amount of at least
$10 million at a price of at least $1.00 per share, then the applicable Conversion Price upon each such issuance or amendment shall be adjusted as provided in the first sentence of subsection (vi) of this Section 3.6(a) on the basis
that (1) the maximum number of Additional Shares of Common Stock immediately issuable pursuant to all such Common Stock Equivalents shall be deemed to have been issued (whether or not such Common Stock Equivalents are actually then exercisable,
convertible or exchangeable in whole or in part) as of the earlier of (A) the date on which the Maker shall enter into a firm contract for the issuance of such Common Stock Equivalent, or (B) the date of actual issuance of such Common
Stock Equivalent. No adjustment of the applicable Conversion Price shall be made under this subsection (vii) upon the issuance of any Convertible Security which is issued pursuant to the exercise of any warrants or other subscription or
purchase rights therefor, if any adjustment shall previously have been made to the exercise price of such warrants then in effect upon the issuance of such warrants or other rights pursuant to this subsection (vii). No adjustment shall be made to
the Conversion Price upon the issuance of Common Stock pursuant to the exercise, conversion or exchange of any Convertible Security or Common Stock Equivalent where an adjustment to the Conversion Price was made as a result of the issuance or
purchase of such Convertible Security or Common Stock Equivalent. 
 (viii) Consideration for Stock. In case any shares
of Common Stock or any Common Stock Equivalents shall be issued or sold: 
 (1) in connection with any merger or consolidation
in which the Maker is the surviving corporation (other than any consolidation or merger in which the previously outstanding shares of Common Stock of the Maker shall be changed to or exchanged for the stock or other securities of another
corporation), the amount of consideration therefor 

  

 -11- 

 
shall be deemed to be the fair value, as determined reasonably and in good faith by the Board of Directors of the Maker, of such portion of the assets and
business of the nonsurviving corporation as such Board may determine to be attributable to such shares of Common Stock, Convertible Securities, rights or warrants or options, as the case may be; or 
 (2) in the event of any consolidation or merger of the Maker in which the Maker is not the surviving corporation or in which the
previously outstanding shares of Common Stock of the Maker shall be changed into or exchanged for the stock or other securities of another corporation, or in the event of any sale of all or substantially all of the assets of the Maker for stock or
other securities of any corporation, the Maker shall be deemed to have issued a number of shares of its Common Stock for stock or securities or other property of the other corporation computed on the basis of the actual exchange ratio on which the
transaction was predicated, and for a consideration equal to the fair market value on the date of such transaction of all such stock or securities or other property of the other corporation. If any such calculation results in adjustment of the
applicable Conversion Price, or the number of shares of Common Stock issuable upon conversion of the Notes, the determination of the applicable Conversion Price or the number of shares of Common Stock issuable upon conversion of the Notes
immediately prior to such merger, consolidation or sale, shall be made after giving effect to such adjustment of the number of shares of Common Stock issuable upon conversion of the Notes. In the event Common Stock is issued with other shares or
securities or other assets of the Maker for consideration which covers both, the consideration computed as provided in this Section 3.6(viii) shall be allocated among such securities and assets as determined in good faith by the Board of
Directors of the Maker. 
 (ix) Market Reset. On April 3, 2009 (the “Reset Date”), if the VWAP
(as defined below) for the twenty (20) Trading Days preceding the Reset Date (the “20-Day VWAP Reset Price”) is less than the then applicable Conversion Price, then the Conversion Price shall, as of the Reset Date, be reduced
to an amount equal to the greater of (a) the 20-Day VWAP Reset Price or (b) $0.50. “VWAP” means, for any date, (i) the daily volume weighted average price of the Common Stock for such date on the OTC Bulletin Board as
reported by Bloomberg Financial L.P. (based on a Trading Day from 9:30 a.m. Eastern Time to 4:02 p.m. Eastern Time); (ii) if the Common Stock is not then listed or quoted on the OTC Bulletin Board and if prices for the Common Stock are then
reported in the “Pink Sheets” published by the Pink Sheets, LLC (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 (iii) in
all other cases, the fair market value of a share of Common Stock as determined in good faith by the Board of Directors. 
 (b) Record
Date. In case the Maker shall take record of the holders of its Common Stock for the purpose of entitling them to subscribe for or purchase Common Stock or Convertible Securities, then the date of the issue or sale of the shares of Common Stock
shall be deemed to be such record date. 
  

 -12- 

 (c) Certain Issues Excepted. Anything herein to the contrary notwithstanding, the Maker shall not
be required to make any adjustment to the Conversion Price in connection with: (i) securities issued (other than for cash) in connection with a merger, acquisition, or consolidation; (ii) securities issued or issuable pursuant to the
conversion or exercise of convertible or exercisable securities issued or outstanding on or prior to the date hereof (so long as the conversion or exercise price in such securities are not amended, except in connection with the issuance of the
Promissory Notes and Warrants, to lower such price and/or adversely affect the Holders), pursuant to the conversion of the Series C Convertible Preferred Stock, or in connection with the issuance of the Promissory Notes (including, without
limitation, pursuant to the Purchase Agreement or that certain Exchange Agreement, dated as of April 3, 2008, by and among the Maker and the holders signatory thereto (the “Exchange Agreement”), or otherwise in connection with the
conversion of Maker’s Series A Preferred Stock); (iii) securities convertible into Common Stock issued in lieu of cash interest payments to holders of the Maker’s securities entitled to interest; (iv) securities issued in
connection with bona fide strategic collaborations, development agreements or licensing transactions approved by the Board; (v) securities issued to financial institutions or lessors in connection with commercial credit arrangements, equipment
financings or similar transactions approved by the Maker’s board of directors; (vi) securities issued or issuable pursuant to any Maker stock option, stock purchase or other equity incentive plan or agreement approved by the Maker’s
board of directors; (vii) any securities issued to any placement agent and/or its designees in connection with any offering or financing of the Maker; (viii) subject to the other provisions of this Section 3.6, securities issued
pursuant to any dividends or other distributions on the Maker’s securities, any subdivision of outstanding securities into a greater number of such securities, or any combination of outstanding securities into a smaller number of such
securities; (ix) securities issued pursuant to a bona fide firm underwritten public offering of the Maker’s securities; (x) securities issuable as a result of the application of similar antidilution provisions in respect of any other
securities; (xi) such additional securities as are designated in writing as not requiring any adjustment to the Conversion Price by holders of a majority of the then aggregate outstanding principal amount of this Note taken together with the
Additional Notes; and (xii) the issuance of any securities by way of dividend or other distribution, or upon the exercise or conversion of, any securities described in clauses (i) through (xi) above. For purposes of this Note,
(A) “Promissory Notes” shall mean collectively, each of the following, as the same may be amended from time to time: (1) the Note, (2) the Additional Notes, and (3) any Additional Notes issued from time to time
as interest on the outstanding principal balance of the foregoing promissory notes; and (B) “Warrants” shall mean, collectively, each of the following, as the same may be amended from time to time: (A) the warrants to
purchase shares of Common Stock issued in connection with the issuance of the Note and the Additional Notes; and (B) the warrants to purchase shares of Common Stock issued and outstanding on or prior to the date hereof. 
 (d) No Impairment. The Maker shall not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issuance or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Maker, but will at all times in
good faith, assist in the carrying out of all the provisions of this Section 3.6 and in the taking of all such action as may be necessary or appropriate in order to protect the Conversion Rights of the Holder against impairment. In the event a
Holder shall elect to convert any Notes as provided herein, the Maker cannot refuse conversion based on any claim that such Holder or anyone associated or affiliated with such Holder has been engaged in any violation of law, violation of an
agreement to which such Holder is a party or for any reason whatsoever, unless an injunction from a court, or notice, restraining or enjoining conversion of all or part of said Notes shall have been issued. 
  

 -13- 

 (e) Certificates as to Adjustments. Upon occurrence of each adjustment or readjustment of the
Conversion Price or number of shares of Common Stock issuable upon conversion of this Note pursuant to this Section 3.6, the Maker at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and
furnish to the Holder a certificate setting forth such adjustment and readjustment, showing in detail the facts upon which such adjustment or readjustment is based. The Maker shall, upon written request of the Holder, at any time, furnish or cause
to be furnished to the Holder a like certificate setting forth such adjustments and readjustments, the applicable Conversion Price in effect at the time, and the number of shares of Common Stock and the amount, if any, of other securities or
property which at the time would be received upon the conversion of this Note. Notwithstanding the foregoing, the Maker shall not be obligated to deliver a certificate unless such certificate would reflect an increase or decrease of at least one
percent (1%) of such adjusted amount. 
 (f) Issue Taxes. The Maker shall pay any and all issue and other taxes, excluding
federal, state or local income taxes, that may be payable in respect of any issue or delivery of shares of Common Stock on conversion of this Note pursuant thereto; provided, however, that the Maker shall not be obligated to pay any
transfer taxes resulting from any transfer requested by the Holder in connection with any such conversion. 
 (g) Fractional Shares.
No fractional shares of Common Stock shall be issued upon conversion of this Note. In lieu of any fractional shares to which the Holder would otherwise be entitled, the Maker shall pay cash equal to the product of such fraction multiplied by the
average of the Closing Sale Prices of the Common Stock for the five (5) consecutive Trading Days immediately preceding the Conversion Date. The term “Closing Sale Price” shall mean, on any particular date (i) the last
closing sale price per share of the Common Stock on such date on the OTC Bulletin Board or another registered national stock exchange on which the Common Stock is then listed, or if there is no such price on such date, then the last closing sale
price on such exchange or quotation system on the date nearest preceding such date, or (ii) if the Common Stock is not listed then on the OTC Bulletin Board or any registered national stock exchange, the last trading price for a share of Common
Stock in the over-the-counter market, as reported by the OTC Bulletin Board or in the Pink Sheets or similar organization or agency succeeding to its functions of reporting prices) at the close of business on such date, or (iii) if the Common
Stock is not then reported by the OTC Bulletin Board or the Pink Sheets (or similar organization or agency succeeding to its functions of reporting prices), then the average of the “Pink Sheet” quotes for the relevant conversion period, as
determined in good faith by the Holder, or (iv) if the Common Stock is not then publicly traded the fair market value of a share of Common Stock as determined by the Holder and reasonably acceptable to the Maker. 
 (h) Reservation of Common Stock. The Maker shall at all times when this Note shall be outstanding, reserve and keep available out of its
authorized but unissued Common Stock, such number of shares of Common Stock as shall from time to time be sufficient to effect the conversion of this Note and all interest accrued thereon; provided that the number of shares of Common Stock so
reserved shall at no time be less than one hundred twenty percent (120%)

  

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of the number of shares of Common Stock for which this Note and all interest accrued thereon is at any time convertible. The Maker shall, from time to time
exercise all authority in accordance with applicable law to seek approval by stockholders to increase the authorized number of shares of Common Stock if at any time the unissued number of authorized shares shall not be sufficient to satisfy the
Maker’s obligations under this Section 3.6(h). 
 (i) Regulatory Compliance. If any shares of Common Stock to be reserved
for the purpose of conversion of this Note or any interest accrued thereon require registration or listing with or approval of any governmental authority, stock exchange or other regulatory body under any federal or state law or regulation or
otherwise before such shares may be validly issued or delivered upon conversion, the Maker shall, at its sole cost and expense, in good faith and as expeditiously as possible, endeavor to secure such registration, listing or approval, as the case
may be. 
 Section 3.7 Prepayment. 
 (a) Intentionally Omitted. 
 (b) Prepayment Option Upon Major Transaction. In lieu of any
other rights of the Holder contained herein arising in connection with the occurrence of a Major Transaction, simultaneous with the occurrence of a Major Transaction (as defined below), the Holder shall have the right, at the Holder’s option,
to require the Maker to prepay in cash all or a portion of the Holder’s Notes at a price equal to one hundred ten percent (110%) of the aggregate principal amount of this Note plus all accrued and unpaid interest (the “Major
Transaction Prepayment Price”); provided that the Holder shall have the sole option to request payment of the Major Transaction Prepayment Price in cash or registered shares of common stock of the acquiror in a Major
Transaction so long as such shares are being registered under the Securities Act in connection with the Major Transaction and the acquiror is a public company whose common stock is registered pursuant to the Exchange Act and whose common stock is
listed or quoted on a national securities exchange, national automated quotation system or the OTC Bulletin Board. In the event the Holder is an Insider Purchaser, then the Holder agrees that prepayment of this Note plus all accrued interest
pursuant to this Section 3.7(b) shall be expressly subordinate to the payment in full of any Additional Notes then being prepaid pursuant to Section 3.7(b) of such Additional Notes which are held by Other Holders which are not Insider
Purchasers. 
 (c) Prepayment Option Upon Triggering Event. In addition to all other rights of the Holder contained herein, after a
Triggering Event (as defined below), the Holder shall have the right, at the Holder’s option, to require the Maker to prepay all or a portion of this Note in cash at a price equal to (1) in the case of any Holder who is an Insider
Purchaser, one hundred percent (100%) of the aggregate principal amount of this Note plus all accrued and unpaid interest, or (2) in the case of any Holder who is not an Insider Purchaser, the sum of (i) the greater of (A) one
hundred twenty-five percent (125%) of the aggregate principal amount of this Note and (B) in the event at such time the Holder is unable, due to the Triggering Event, to obtain the benefit of its conversion rights through the conversion of
this Note and resale of the shares of Common Stock issuable upon conversion hereof in accordance with the terms of this Note and the other Transaction Documents, the aggregate principal amount of this Note, divided 

  

 -15- 

 
by the Conversion Price on (x) the date the Prepayment Price (as defined below) is demanded or otherwise due or (y) the date the Prepayment Price
is paid in full, whichever is less, multiplied by the VWAP on (x) the date the Prepayment Price is demanded or otherwise due, and (y) the date the Prepayment Price is paid in full, whichever is greater, and (ii) all other amounts,
costs, expenses and liquidated damages due in respect of this Note and the other Transaction Documents (the “Triggering Event Prepayment Price,” and, collectively with the Major Transaction Prepayment Price, the “Prepayment
Price”). In the event the Holder is an Insider Purchaser, then the Holder agrees that prepayment of this Note plus all accrued interest pursuant to this Section 3.7(c) shall be expressly subordinate to the payment in full of any
Additional Notes then being prepaid pursuant to Section 3.7(c) of such Additional Notes which are held by Other Holders which are not Insider Purchasers. 
 (d) Intentionally Omitted. 
 (e) “Major Transaction.” A “Major
Transaction” shall be deemed to have occurred at such time as any of the following events: 
 (i) the consolidation,
merger or other business combination of the Maker with or into another Person (as defined in Section 4.14 hereof) (other than (A) pursuant to a migratory merger effected solely for the purpose of changing the jurisdiction of incorporation
of the Maker or (B) a consolidation, merger or other business combination in which holders of the Maker’s voting power immediately prior to the transaction continue after the transaction to hold, directly or indirectly, the voting power of
the surviving entity or entities necessary to elect a majority of the members of the board of directors (or their equivalent if other than a corporation) of such entity or entities); or 
 (ii) the sale or transfer of more than fifty percent (50%) of the Maker’s assets (based on the fair market value as determined
in good faith by the Maker’s Board of Directors) other than inventory in the ordinary course of business in one or a series of related transactions. 
 (f) “Triggering Event.” A “Triggering Event” shall be deemed to have occurred at such time as any of the following events: 
 (i) the Maker’s notice to any holder of the Notes, including by way of public announcement, at any time, of its inability to comply
(including for any of the reasons described in Section 3.8) or its intention not to comply with proper requests for conversion of any Notes into shares of Common Stock; or 
 (ii) the Maker’s failure to comply with a Conversion Notice tendered in accordance with the provisions of this Note within ten
(10) business days after the receipt by the Maker of the Conversion Notice; or 
 (iii) the Maker deregisters its shares
of Common Stock and as a result such shares of Common Stock are no longer publicly tradable; or 
  

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 (iv) the Maker consummates a “going private” transaction and as a result the
Common Stock is no longer registered under Sections 12(b) or 12(g) of the Exchange Act. 
 (g) Intentionally Omitted. 
 (h) Mechanics of Prepayment at Option of Holder Upon Major Transaction. No sooner than fifteen (15) days nor later than ten (10) days
prior to the consummation of a Major Transaction, but not prior to the public announcement of such Major Transaction, the Maker shall deliver written notice thereof via facsimile and overnight courier (“Notice of Major Transaction”)
to the Holder of this Note. At any time after receipt of a Notice of Major Transaction (or, in the event a Notice of Major Transaction is not delivered at least ten (10) days prior to a Major Transaction, at any time within ten (10) days
prior to a Major Transaction), any holder of the Notes then outstanding may require the Maker to prepay, effective immediately prior to the consummation of such Major Transaction, all of the holder’s Notes then outstanding by delivering written
notice thereof via facsimile and overnight courier (“Notice of Prepayment at Option of Holder Upon Major Transaction”) to the Maker, which Notice of Prepayment at Option of Holder Upon Major Transaction shall indicate (i) the
principal amount of the Notes that such holder is electing to have prepaid and (ii) the applicable Major Transaction Prepayment Price, as calculated pursuant to Section 3.7(b) above. 
 (i) Mechanics of Prepayment at Option of Holder Upon Triggering Event. Within one (1) business day after the occurrence of a Triggering
Event, the Maker shall deliver written notice thereof via facsimile and overnight courier (“Notice of Triggering Event”) to each holder of the Notes. At any time after the earlier of a holder’s receipt of a Notice of Triggering
Event and such holder becoming aware of a Triggering Event having occurred, any holder of this Note may require the Maker to prepay this Note by delivering written notice thereof via facsimile and overnight courier (“Notice of Prepayment at
Option of Holder Upon Triggering Event”) to the Maker, which Notice of Prepayment at Option of Holder Upon Triggering Event shall indicate (i) the amount of the Note that such holder is electing to have prepaid and (ii) the
applicable Triggering Event Prepayment Price, as calculated pursuant to Section 3.7(c) above. A holder shall only be permitted to require the Maker to prepay the Note pursuant to Section 3.7 hereof for the greater of a period of ten
(10) days after receipt by such holder of a Notice of Triggering Event or for so long as such Triggering Event is continuing. 
 (j)
Payment of Prepayment Price. Each holder that has sent a Notice(s) of Prepayment at Option of Holder Upon Triggering Event or a Notice(s) of Prepayment at Option of Holder Upon Major Transaction shall promptly submit to the Maker such
holder’s certificates representing the Notes that such holder has elected to have prepaid. The Maker shall deliver the applicable Triggering Event Prepayment Price, in the case of a prepayment pursuant to Section 3.7(i), to such holder
within five (5) business days after the Maker’s receipt of a Notice of Prepayment at Option of Holder Upon Triggering Event and, in the case of a prepayment pursuant to Section 3.7(h), the Maker shall deliver the applicable Major
Transaction Prepayment Price immediately prior to the consummation of the Major Transaction; provided that a holder’s original Note shall have been so delivered to the Maker; provided further that if the Maker is unable to prepay all of the
Notes to be prepaid, the Maker shall prepay an amount from each 

  

 -17- 

 
holder of the Notes being prepaid equal to such holder’s pro-rata amount (based on the number of Notes held by such holder relative to the number of
Notes outstanding) of all Notes being prepaid. If the Maker shall fail to prepay all of the Notes submitted for prepayment (other than pursuant to a dispute as to the arithmetic calculation of the Prepayment Price), in addition to any remedy such
holder of the Notes may have under this Note and the Purchase Agreement, the applicable Prepayment Price payable in respect of such Notes not prepaid shall bear interest at the rate of two percent (2%) per month (prorated for partial months)
until paid in full. Until the Maker pays such unpaid applicable Prepayment Price in full to a holder of the Notes submitted for prepayment, such holder shall have the option (the “Void Optional Prepayment Option”) to, in lieu of
prepayment, require the Maker to promptly return to such holder(s) all of the Notes that were submitted for prepayment by such holder(s) under this Section 3.7 and for which the applicable Prepayment Price has not been paid, by sending written
notice thereof to the Maker via facsimile (the “Void Optional Prepayment Notice”). Upon the Maker’s receipt of such Void Optional Prepayment Notice(s) and prior to payment of the full applicable Prepayment Price to such holder,
(i) the Notice(s) of Prepayment at Option of Holder Upon Triggering Event or the Notice(s) of Prepayment at Option of Holder Upon Major Transaction, as the case may be, shall be null and void with respect to those Notes submitted for prepayment
and for which the applicable Prepayment Price has not been paid, (ii) the Maker shall immediately return any Notes submitted to the Maker by each holder for prepayment under this Section 3.7(j) and for which the applicable Prepayment Price
has not been paid and (iii) the Conversion Price of such returned Notes shall be adjusted to the Conversion Price as in effect on the date on which the Void Optional Prepayment Notice(s) is delivered to the Maker; provided that no
adjustment shall be made if such adjustment would result in an increase of the Conversion Price then in effect. A holder’s delivery of a Void Optional Prepayment Notice and exercise of its rights following such notice shall not affect the
Maker’s obligations to make any payments which have accrued prior to the date of such notice. Payments provided for in this Section 3.7 shall have priority to payments to the Maker’s stockholders in connection with a Major
Transaction. 
 (k) Maker Prepayment Option. 
 (i) At any time following October 3, 2008, the Maker may prepay in cash all or any portion of the outstanding principal amount of
this Note together with all accrued and unpaid interest thereon upon ten (10) Trading Days prior written notice to the Holder (the “Maker’s Prepayment Notice”) at a price (the “Maker’s Prepayment
Price”) equal to (A) one hundred percent (100%) of the aggregate principal amount of this Note; plus (B) any accrued but unpaid interest outstanding at such time; (C) plus an amount equal to interest at the interest rate
as determined in accordance with Section 1.2 hereof on the principal amount of this Note being prepaid for a period that commences on the date of such prepayment and that terminates on the Maturity Date; provided, however, that if
the Holder has delivered a Conversion Notice to the Maker or delivers a Conversion Notice within such ten (10) Trading Day period following delivery of the Maker’s Prepayment Notice, the principal amount of this Note designated to be
converted may not be prepaid by the Maker and shall be converted in accordance with Section 3.3 hereof; provided further that if during the period between delivery of the Maker’s Prepayment Notice and the Maker’s
Prepayment Date (as defined below), the Holder shall become entitled to deliver a Notice of Prepayment at Option of Holder Upon Major Transaction or Notice of Prepayment at Option of Holder Upon Triggering Event, then such rights of the Holder, at
its 

  

 -18- 

 
option, shall take precedence over the previously delivered Maker Prepayment Notice. The Maker’s Prepayment Notice shall state the date of prepayment
which date shall be the eleventh (11th) Trading Day after the Maker has delivered the Maker’s Prepayment Notice (the “Maker’s
Prepayment Date”), the Maker’s Prepayment Price and the principal amount of this Note to be prepaid by the Maker. The Maker shall deliver the Maker’s Prepayment Price on the Maker’s Prepayment Date, provided, that if
the Holder delivers a Conversion Notice before the Maker’s Prepayment Date, then the portion of the Maker’s Prepayment Price which would be paid to prepay this Note covered by such Conversion Notice shall be returned to the Maker upon
delivery of the Common Stock issuable in connection with such Conversion Notice to the Holder. On the Maker’s Prepayment Date, the Maker shall pay the Maker’s Prepayment Price, subject to any adjustment pursuant to the immediately
preceding sentence, to the Holder. If the Maker fails to pay the Maker’s Prepayment Price by the eleventh (11th) Trading Day after the
Maker has delivered the Maker’s Prepayment Notice, the Maker’s Prepayment Notice will be declared null and void ab initio and the Maker shall lose its right to prepay this Note pursuant to this Section 3.7(k). Notwithstanding
the foregoing to the contrary, the Maker may effect a prepayment pursuant to this Section 3.7(k) only if (1) trading in the Common Stock shall not have been suspended without resumption by the Securities and Exchange Commission or the OTC
Bulletin Board (or other exchange or market on which the Common Stock is trading or quoted), (2) the Maker is in material compliance with the terms and conditions of this Note and the other Transaction Documents, and (3) the Holder is not
in possession of any material non-public information provided by Maker and (4) the Maker shall have filed all reports required to be filed by it under the Exchange Act for the preceding 12 months. 
 Section 3.8 Inability to Fully Convert. 
 (a) Holder’s Option if Maker Cannot Fully Convert. If, upon the Maker’s receipt of a Conversion Notice, the Maker cannot issue shares of Common Stock pursuant to such Conversion Notice for any reason, including, without
limitation, because the Maker (w) does not have a sufficient number of shares of Common Stock authorized and available or (x) is otherwise prohibited by applicable law or by the rules or regulations of any stock exchange, interdealer
quotation system or other self-regulatory organization with jurisdiction over the Maker or any of its securities from issuing all of the Common Stock which is to be issued to the Holder pursuant to a Conversion Notice, then the Maker shall issue as
many shares of Common Stock as it is able to issue in accordance with the Holder’s Conversion Notice and, with respect to the unconverted portion of this Note, the Holder, solely at Holder’s option, can elect to: 
 (i) void its Conversion Notice and retain or have returned, as the case may be, this Note that was to be converted pursuant to the
Conversion Notice (provided that the Holder’s voiding its Conversion Notice shall not effect the Maker’s obligations to make any payments which have accrued prior to the date of such notice); 
 (ii) subject to Section 3.3(d) hereof, exercise its Buy-In rights pursuant to and in accordance with the terms and provisions of
Section 3.3(c) of this Note. 
  

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 (b) Mechanics of Fulfilling Holder’s Election. The Maker shall promptly send via facsimile to
the Holder, upon receipt of a facsimile copy of a Conversion Notice from the Holder which cannot be fully satisfied as described in Section 3.8(a) above, a notice of the Maker’s inability to fully satisfy the Conversion Notice (the
“Inability to Fully Convert Notice”). Such Inability to Fully Convert Notice shall indicate (i) the reason why the Maker is unable to fully satisfy such holder’s Conversion Notice and (ii) the amount of this Note
which cannot be converted. The Holder shall notify the Maker of its election pursuant to Section 3.8(a) above by delivering written notice via facsimile to the Maker (“Notice in Response to Inability to Convert”). 

(c) Pro-rata Conversion. In the event the Maker receives a Conversion Notice from more than one holder of the Notes on the same day and the
Maker can convert some, but not all, of the Notes pursuant to this Section 3.8, the Maker shall convert from each holder of the Notes electing to have its Notes converted at such time an amount equal to such holder’s pro-rata amount (based
on the principal amount of the Notes held by such holder relative to the principal amount of the Notes outstanding) of all the Notes being converted at such time. 
 Section 3.9 No Rights as Shareholder. Nothing contained in this Note shall be construed as conferring upon the Holder, prior to the conversion of this Note, the right to vote or to receive dividends or to
consent or to receive notice as a shareholder in respect of any meeting of shareholders for the election of directors of the Maker or of any other matter, or any other rights as a shareholder of the Maker. 
 ARTICLE IV 
 MISCELLANEOUS 

Section 4.1 Notices. Any notice, demand, request, waiver or other communication required or permitted to be given hereunder shall be in writing
and shall be effective (a) upon hand delivery, telecopy or facsimile at the address or number designated in the Purchase Agreement (if delivered on a business day during normal business hours where such notice is to be received), or the first
business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully
prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The Maker will give written notice to the Holder at least five (5) days prior to the date on which the Maker takes a record (x) with
respect to any dividend or distribution upon the Common Stock, (y) with respect to any pro rata subscription offer to holders of Common Stock or (z) for determining rights to vote with respect to any Organic Change, dissolution,
liquidation or winding-up and in no event shall such notice be provided to such holder prior to such information being made known to the public. The Maker will also give written notice to the Holder at least five (5) days prior to the date on
which any Organic Change, dissolution, liquidation or winding-up will take place and in no event shall such notice be provided to the Holder prior to such information being made known to the public. 
 Section 4.2 Governing Law. This Note shall be governed by and construed in accordance with the internal laws of the State of New York, without
giving effect to any of the conflicts of law principles which would result in the application of the substantive law of another jurisdiction. This Note shall not be interpreted or construed with any presumption against the party causing this Note to
be drafted. 
  

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 Section 4.3 Headings. Article and section headings in this Note are included herein for purposes
of convenience of reference only and shall not constitute a part of this Note for any other purpose. 
 Section 4.4 Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Note shall not be exclusive. 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 thereof and shall not, except as expressly provided herein, be subject to any other obligation of the Maker (or the performance thereof). The Maker acknowledges that a breach by it of its
obligations hereunder will cause irreparable and material harm to the Holder and that the remedy at law for any such breach may be inadequate. Therefore the Maker agrees that, in the event of any such breach or threatened breach, the Holder shall be
entitled, in addition to all other available rights and remedies, at law or in equity, to seek and obtain such equitable relief, including but not limited to an injunction restraining any such breach or threatened breach, without the necessity of
showing economic loss and without any bond or other security being required. 
 Section 4.5 Enforcement Expenses. The Maker agrees to
pay all reasonable costs and expenses of enforcement and collection of this Note, including, without limitation, reasonable attorneys’ fees and expenses. 
 Section 4.6 Binding Effect. The obligations of the Maker and the Holder set forth herein shall be binding upon the successors and assigns of each such party, whether or not such successors or assigns are
permitted by the terms hereof. 
 Section 4.7 Amendments. This Note may not be modified or amended in any manner except in writing
executed by the Maker and the Holder. 
 Section 4.8 Compliance with Securities Laws. The Holder of this Note acknowledges that this
Note is being acquired solely for the Holder’s own account and not as a nominee for any other party, and for investment, and that the Holder shall not offer, sell or otherwise dispose of this Note. This Note and any Note issued in substitution
or replacement therefor shall be stamped or imprinted with a legend in substantially the following form: 
 “THIS NOTE AND THE SHARES OF
COMMON STOCK ISSUABLE UPON CONVERSION HEREOF HAVE NOT BEEN 
 REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
OR APPLICABLE STATE 
 SECURITIES LAWS, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR RECEIPT BY THE MAKER OF AN
OPINION OF COUNSEL IN THE FORM, SUBSTANCE AND SCOPE REASONABLY SATISFACTORY TO THE MAKER THAT THIS NOTE AND THE SHARES OF COMMON STOCK 
 ISSUABLE UPON CONVERSION HEREOF HAVE MAY BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE DISPOSED OF, UNDER AN EXEMPTION FROM REGISTRATION UNDER THE ACT AND SUCH STATE 
 SECURITIES LAWS.” 
  

 -21- 

 Section 4.9 Consent to Jurisdiction. Each of the Maker and the Holder (i) hereby irrevocably
submits to the exclusive jurisdiction of the United States District Court sitting in the Southern District of New York and the courts of the State of New York located in New York county for the purposes of any suit, action or proceeding arising out
of or relating to this Note and (ii) hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought
in an inconvenient forum or that the venue of the suit, action or proceeding is improper. Each of the Maker and the Holder consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address
in effect for notices to it under the Purchase Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing in this Section 4.9 shall affect or limit any right to serve process in
any other manner permitted by law. Each of the Maker and the Holder hereby agree that the prevailing party in any suit, action or proceeding arising out of or relating to this Note shall be entitled to reimbursement for reasonable legal fees from
the non-prevailing party. 
 Section 4.10 Parties in Interest. This Note shall be binding upon, inure to the benefit of and be
enforceable by the Maker, the Holder and their respective successors and permitted assigns. 
 Section 4.11 Failure or Indulgence Not
Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or
further exercise thereof or of any other right, power or privilege. 
 Section 4.12 Maker Waivers. Except as otherwise specifically
provided herein, the Maker and all others that may become liable for all or any part of the obligations evidenced by this Note, to the extent allowed by applicable law, hereby waive presentment, demand, notice of nonpayment, protest and all other
demands’ and notices in connection with the delivery, acceptance, performance and enforcement of this Note, and do hereby consent to any number of renewals of extensions of the time or payment hereof and agree that any such renewals or
extensions may be made without notice to any such persons and without affecting their liability herein and do further consent to the release of any person liable hereon, all without affecting the liability of the other persons, firms or Maker liable
for the payment of this Note, AND DO HEREBY WAIVE TRIAL BY JURY. 
 (a) No delay or omission on the part of the Holder in exercising its
rights under this Note, or course of conduct relating hereto, shall operate as a waiver of such rights or any other right of the Holder, nor shall any waiver by the Holder of any such right or rights on any one occasion be deemed a waiver of the
same right or rights on any future occasion. 
  

 -22- 

 (b) THE MAKER ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS A COMMERCIAL TRANSACTION,
AND TO THE EXTENT ALLOWED BY APPLICABLE LAW, HEREBY WAIVES ITS RIGHT TO NOTICE AND HEARING WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH THE HOLDER OR ITS SUCCESSORS OR ASSIGNS MAY DESIRE TO USE. 
 Section 4.14 Definitions. For the purposes hereof, the following terms shall have the following meanings: 
 “Person” means an individual or a corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind. 
 “Trading Day” means any day during which The New York Stock Exchange shall be open for business. 
 “Transaction Documents” means this Note and the Purchase Agreement. 
  

 -23- 

					
	FLO CORPORATION
		
	By:	 	 
		 	Name:	 	Glenn L. Argenbright
		 	Title:	 	President and Chief Executive OfficerForm of Note Warrant

 Exhibit 4.2 
 THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY
NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS, OR FLO CORPORATION SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE
SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED. 
 WARRANT TO PURCHASE 
 SHARES OF COMMON STOCK 
 OF 
 FLO CORPORATION 
 Expires April 3,
2013 
  

			
	 No.:             
	  	Number of Shares:             
	Date of Issuance: April 3, 2008	  	

 FOR VALUE RECEIVED, subject to the provisions hereinafter set forth, the undersigned, FLO
Corporation, a Delaware corporation (together with its successors and assigns, the “Issuer”), hereby certifies that              or its registered assigns is
entitled to subscribe for and purchase, during the Term (as hereinafter defined), up to              (            )
shares (subject to adjustment as hereinafter provided) of the duly authorized, validly issued, fully paid and non-assessable Common Stock of the Issuer, at an exercise price per share equal to the Warrant Price then in effect, subject, however, to
the provisions and upon the terms and conditions hereinafter set forth. Capitalized terms used in this Warrant and not otherwise defined herein shall have the respective meanings specified in Section 9 hereof. 
 1. Term. The term of this Warrant shall commence on April 3, 2008 and shall expire at 5:00 p.m., eastern time, on April 3, 2013 (such
period, the “Term”). 
 2. Method of Exercise; Payment; Issuance of New Warrant; Transfer and Exchange. 

(a) Time of Exercise. The purchase rights represented by this Warrant may be exercised in whole or in part at any time during the Term.

 (b) Method of Exercise. 
 (i) The Holder hereof may exercise this Warrant, in whole or in part, by the surrender of this Warrant (with the exercise form attached hereto duly executed) at the principal office of the Issuer, and by the payment
to the Issuer of an amount of consideration therefor equal to the Warrant Price in effect on the date of such exercise multiplied by the number of shares of Warrant Stock with respect to which this Warrant is then being exercised, payable at 

 
such Holder’s election (A) by certified or official bank check or by wire transfer to an account designated by the Issuer, (B) by
“cashless exercise” in accordance with subsection (ii) of this Section 2(b), but only when there is no effective registration statement under the Securities Act covering the resale of the shares of Common Stock issuable upon
exercise hereof or (C) by a combination of the foregoing methods of payment selected by the Holder of this Warrant. 
 (ii) Cashless Exercise. Notwithstanding any provisions herein to the contrary, if at any time after October 3, 2008, there is no effective registration statement under the Securities Act covering the resale of the shares of
Common Stock issuable upon exercise hereof, then in lieu of exercising this Warrant by payment of cash, the Holder may exercise this Warrant by a “cashless exercise” and shall receive the number of shares of Common Stock computed using the
following formula: 
  

					
		
	 X = Y  -
	  	 (A)(Y)
     B

					
			
	 Where
	  	X   =	  	the number of shares of Common Stock to be issued to the Holder;
			
		  	Y   =	  	the number of shares of Common Stock purchasable upon exercise of all of the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being
exercised;
			
		  	A   =	  	the Warrant Price; and
			
		  	B   =	  	the Per Share Market Value of one share of Common Stock on the date of exercise.

 (c) Issuance of Stock Certificates. In the event of any exercise of the rights represented
by this Warrant in accordance with and subject to the terms and conditions hereof, (i) certificates for the shares of Warrant Stock so purchased shall be dated the date of such exercise and delivered to the Holder hereof within a reasonable
time, not exceeding three (3) Trading Days after such exercise or, at the request of the Holder (provided that a registration statement under the Securities Act providing for the resale of the Warrant Stock is then in effect), issued and
delivered to the Depository Trust Company (“DTC”) account on the Holder’s behalf via the Deposit Withdrawal Agent Commission System (“DWAC”) within a reasonable time, not exceeding three (3) Trading Days
after such exercise, and the Holder hereof shall be deemed for all purposes to be the holder of the shares of Warrant Stock so purchased as of the date of such exercise, and (ii) unless this Warrant has expired, a new Warrant representing the
number of shares of Warrant Stock, if any, with respect to which this Warrant shall not then have been exercised (less any amount thereof which shall have been canceled in payment or partial payment of the Warrant Price as hereinabove provided)
shall also be issued to the Holder hereof at the Issuer’s expense within such time. 
 (d) Transferability of Warrant. Subject to
Section 2(f), this Warrant may be transferred by a Holder without the consent of the Issuer. If transferred pursuant to this paragraph and subject to the provisions Section 2(f), this Warrant may be transferred on the books of the Issuer
by the Holder hereof in person or by duly authorized attorney, upon surrender of this Warrant at the principal office of the Issuer, properly endorsed (by the Holder executing an 

  

 - 2 - 

 
assignment in the form attached hereto) and upon payment of any necessary transfer tax or other governmental charge imposed upon such transfer. This Warrant
is exchangeable at the principal office of the Issuer for Warrants for the purchase of the same aggregate number of shares of Warrant Stock, each new Warrant to represent the right to purchase such number of shares of Warrant Stock as the Holder
hereof shall designate at the time of such exchange. All Warrants issued on transfers or exchanges shall be dated the Original Issue Date and shall be identical with this Warrant except as to the number of shares of Warrant Stock issuable pursuant
hereto. 
 (e) Continuing Rights of Holder. The Issuer will, at the time of or at any time after each exercise of this Warrant, upon
the request of the Holder hereof, acknowledge in writing the extent, if any, of its continuing obligation to afford to such Holder all rights to which such Holder shall continue to be entitled after such exercise in accordance with the terms of this
Warrant, provided, that if any such Holder shall fail to make any such request, the failure shall not affect the continuing obligation of the Issuer to afford such rights to such Holder. 
 (f) Compliance with Securities Laws. 
 (i) The Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant or the shares of Warrant Stock to be issued upon exercise hereof are being acquired solely for the Holder’s own account and not
as a nominee for any other party, and not with a view to or in connection with a distribution, and that the Holder will not offer, sell or otherwise dispose of this Warrant or any shares of Warrant Stock to be issued upon exercise hereof except
pursuant to an effective registration statement, or an exemption from registration, under the Securities Act and any applicable state securities laws. 
 (ii) Except as provided in paragraph (iii) below, this Warrant and all certificates representing shares of Warrant Stock issued upon exercise hereof shall be stamped or imprinted with a legend in substantially
the following form: 
 THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR FLO CORPORATION
SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED. 
 (iii) The restrictions imposed by this subsection (f) upon the transfer of this Warrant or the shares of Warrant Stock to be
purchased upon exercise hereof shall terminate (A) when such Securities shall have been resold pursuant to an effective registration statement under the Securities Act, (B) upon the Issuer’s receipt of an 

  

 - 3 - 

 
opinion of counsel, in form and substance reasonably satisfactory to the Issuer, addressed to the Issuer to the effect that such restrictions are no longer
required to ensure compliance with the Securities Act and state securities laws or (C) upon the Issuer’s receipt of other evidence reasonably satisfactory to the Issuer that such registration and qualification under the Securities Act and
state securities laws are not required, which shall be deemed to include a customary Rule 144 representation letter from the Holder. Whenever such restrictions shall cease and terminate as to any such Securities, the Holder thereof shall be entitled
to receive from the Issuer (or its transfer agent and registrar), without expense (other than applicable transfer taxes, if any), new Warrants (or, in the case of shares of Warrant Stock, new stock certificates) of like tenor not bearing the
applicable legend required by paragraph (ii) above relating to the Securities Act and state securities laws. 
 3. Stock Fully Paid;
Reservation and Listing of Shares; Covenants. 
 (a) Stock Fully Paid. The Issuer represents, warrants, covenants and agrees that
all shares of Warrant Stock which may be issued upon the exercise of this Warrant or otherwise hereunder will, upon issuance, be duly authorized, validly issued, fully paid and non-assessable and free from all taxes, liens and charges created by or
through Issuer. The Issuer further covenants and agrees that during the period within which this Warrant may be exercised, the Issuer will at all times have authorized and reserved for the purpose of the issue upon exercise of this Warrant a
sufficient number of shares of Common Stock to provide for the exercise of this Warrant. 
 (b) Reservation. If any shares of Common
Stock required to be reserved for issuance upon exercise of this Warrant or as otherwise provided hereunder require registration or qualification with any governmental authority under any federal or state law before such shares may be so issued, the
Issuer will in good faith use commercially reasonable efforts as expeditiously as possible at its expense to cause such shares to be duly registered or qualified. If the Issuer shall list any shares of Common Stock on any securities exchange or
market, it will, at its expense, list thereon, maintain and increase when necessary such listing of all shares of Warrant Stock from time to time issued upon exercise of this Warrant or as otherwise provided hereunder (provided that such Warrant
Stock has been registered pursuant to a then-effective registration statement under the Securities Act), and, to the extent permissible under the applicable securities exchange rules, all unissued shares of Warrant Stock which are at any time
issuable hereunder, so long as any shares of Common Stock shall be so listed. The Issuer will also so list on each securities exchange or market, and will maintain such listing of, any other Securities which the Holder of this Warrant shall be
entitled to receive upon the exercise of this Warrant if at the time any Securities of the same class shall be listed on such securities exchange or market by the Issuer. 
 (c) Covenants. The Issuer shall not by any action including, without limitation, amending the Certificate of Incorporation or Bylaws of the Issuer or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of Securities or any other action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such
terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of the Holder hereof against impairment. Without limiting the generality of the foregoing, the Issuer will (i) not 

  

 - 4 - 

 
permit the par value, if any, of its Common Stock to exceed the then-effective Warrant Price, (ii) not amend or modify any provision of the Certificate
of Incorporation or Bylaws of the Issuer in any manner that would adversely affect the rights of the Holders of the Warrants, (iii) take all such action as may be reasonably necessary in order that the Issuer may validly and legally issue fully
paid and nonassessable shares of Common Stock, free and clear of any liens, claims, encumbrances and restrictions (other than as provided herein or under applicable securities laws) upon the exercise of this Warrant, and (iv) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be reasonably necessary to enable the Issuer to perform its obligations under this Warrant. 

(d) Loss, Theft, Destruction of Warrants. Upon receipt of evidence satisfactory to the Issuer of the ownership of and the loss, theft,
destruction or mutilation of any Warrant and, in the case of any such loss, theft or destruction, upon receipt of indemnity or security satisfactory to the Issuer or, in the case of any such mutilation, upon surrender and cancellation of such
Warrant, the Issuer will make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new Warrant of like tenor and representing the right to purchase the same number of shares of Common Stock. 
 4. Adjustment of Warrant Price. The price at which shares of Common Stock for which this Warrant is exercisable may be purchased upon exercise of
this Warrant shall be subject to adjustment from time to time as set forth in this Section 4. The Issuer shall give the Holder notice of any event described below which requires an adjustment pursuant to this Section 4 in accordance with
Section 5. 
 (a) Recapitalization, Reorganization, Reclassification, Consolidation, Merger or Sale. 
 (i) In case the Issuer after the Original Issue Date shall do any of the following (each, a “Triggering Event”):
(a) consolidate with or merge into any other Person and the Issuer shall not be the continuing or surviving corporation of such consolidation or merger, or (b) permit any other Person to consolidate with or merge into the Issuer and the
Issuer shall be the continuing or surviving Person but, in connection with such consolidation or merger, any Capital Stock of the Issuer shall be changed into or exchanged for securities of any other Person or cash or any other property, or
(c) transfer all or substantially all of its properties or assets to any other Person, or (d) effect a capital reorganization or reclassification of its Capital Stock, then, and in the case of each such Triggering Event, proper provision
shall be made so that, upon the basis and the terms and in the manner provided in this Warrant, the Holder of this Warrant shall be entitled upon the exercise hereof at any time after the consummation of such Triggering Event, to the extent this
Warrant is not exercised prior to such Triggering Event, to receive at the Warrant Price in effect at the time immediately prior to the consummation of such Triggering Event in lieu of the Common Stock issuable upon such exercise of this Warrant
prior to such Triggering Event, the securities, cash and property to which such Holder would have been entitled upon the consummation of such Triggering Event if such Holder had exercised the rights represented by this Warrant immediately prior
thereto, subject to adjustments (subsequent to such corporate action) as nearly equivalent as possible to the adjustments provided for elsewhere in this Section 4. 
  

 - 5 - 

 (ii) Notwithstanding anything contained in this Warrant to the contrary, a Triggering
Event shall not be deemed to have occurred if, prior to the consummation thereof, each Person (other than the Issuer) which may be required to deliver any securities, cash or property upon the exercise of this Warrant as provided herein shall
assume, by written instrument delivered to, and reasonably satisfactory to, the Holder of this Warrant, (A) the obligations of the Issuer under this Warrant (and if the Issuer shall survive the consummation of such Triggering Event, such
assumption shall be in addition to, and shall not release the Issuer from, any continuing obligations of the Issuer under this Warrant) and (B) the obligation to deliver to such Holder such securities, cash or property as, in accordance with
the foregoing provisions of this subsection (a), such Holder shall be entitled to receive, and such Person shall have similarly delivered to such Holder an opinion of counsel for such Person, which counsel shall be reasonably satisfactory to such
Holder, or in the alternative, a written acknowledgement executed by the President or Chief Financial Officer of the Issuer, stating that this Warrant shall thereafter continue in full force and effect and the terms hereof (including, without
limitation, all of the provisions of this subsection (a)) shall be applicable to the securities, cash or property which such Person may be required to deliver upon any exercise of this Warrant or the exercise of any rights pursuant hereto.

 (b) Stock Dividends, Subdivisions and Combinations. If at any time the Issuer shall: 
 (i) take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend payable in, or other
distribution of, shares of Common Stock, 
 (ii) subdivide its outstanding shares of Common Stock into a larger number of
shares of Common Stock, or 
 (iii) combine its outstanding shares of Common Stock into a smaller number of shares of Common
Stock, 
 then (1) the number of shares of Common Stock for which this Warrant is exercisable immediately after the occurrence of any such event shall
be adjusted to equal the number of shares of Common Stock which a record holder of the same number of shares of Common Stock for which this Warrant is exercisable immediately prior to the occurrence of such event would own or be entitled to receive
after the happening of such event, and (2) the Warrant Price then in effect shall be adjusted to equal (A) the Warrant Price then in effect multiplied by the number of shares of Common Stock for which this Warrant is exercisable
immediately prior to the adjustment divided by (B) the number of shares of Common Stock for which this Warrant is exercisable immediately after such adjustment. 
 (c) Certain Other Distributions. If at any time the Issuer shall take a record of the holders of its Common Stock for the purpose of entitling them to receive any dividend or other distribution of: 

(i) cash (other than a cash dividend payable out of earnings or earned surplus legally available for the payment of dividends under the
laws of the jurisdiction of incorporation of the Issuer), 
  

 - 6 - 

 (ii) any evidences of its indebtedness, any shares of stock of any class or any other
securities or property of any nature whatsoever (other than cash, Common Stock Equivalents or Additional Shares of Common Stock), or 
 (iii) any warrants or other rights to subscribe for or purchase any evidences of its indebtedness, any shares of stock of any class or any other securities or property of any nature whatsoever (other than cash, Common Stock Equivalents or
Additional Shares of Common Stock), 
 then (1) the number of shares of Common Stock for which this Warrant is exercisable shall be adjusted to equal
the product of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such adjustment multiplied by a fraction (A) the numerator of which shall be the Per Share Market Value of Common Stock at the date
of taking such record and (B) the denominator of which shall be such Per Share Market Value minus the amount allocable to one share of Common Stock of any such cash so distributable and of the fair value (as determined in good faith by the
Board) of any and all such evidences of indebtedness, shares of stock, other securities or property or warrants or other subscription or purchase rights so distributable, and (2) the Warrant Price then in effect shall be adjusted to equal
(A) the Warrant Price then in effect multiplied by the number of shares of Common Stock for which this Warrant is exercisable immediately prior to the adjustment divided by (B) the number of shares of Common Stock for which this Warrant is
exercisable immediately after such adjustment. A reclassification of the Common Stock (other than a change in par value, or from par value to no par value or from no par value to par value) into shares of Common Stock and shares of any other class
of stock shall be deemed a distribution by the Issuer to the holders of its Common Stock of such shares of such other class of stock within the meaning of this Section 4(c) and, if the outstanding shares of Common Stock shall be changed into a
larger or smaller number of shares of Common Stock as a part of such reclassification, such change shall be deemed a subdivision or combination, as the case may be, of the outstanding shares of Common Stock within the meaning of Section 4(b).

 (d) Issuance of Additional Shares of Common Stock. 
 (i) In the event the Issuer shall at any time issue any Additional Shares of Common Stock (otherwise than as provided in the foregoing
subsections (b) through (c) of this Section 4 and other than Permitted Issuances) at a price per share less than the Warrant Price then in effect or without consideration, then the Warrant Price upon each such issuance shall be
reduced to a price equal to the per share price paid for such additional shares of Common Stock; provided, however, that, notwithstanding the foregoing, if, subsequent to the Original Issue Date and prior to such issuance and sale, the
Issuer shall have completed an equity or equity-linked financing with gross proceeds in an amount of at least $10 million at a price of at least $1.00 per share, then the Warrant Price upon such issuance shall be adjusted to that price (rounded to
the nearest cent) determined by multiplying the Warrant Price then in effect by a fraction: 
 (A) the numerator of which
shall be equal to the sum of (x) the number of shares of Outstanding Common Stock immediately prior to the issuance of such Additional Shares of Common Stock plus (y) the number of shares of Common Stock which the aggregate
consideration for the total number of such Additional Shares of Common Stock so issued would purchase at a price per share equal to the Warrant Price then in effect, and 
  

 - 7 - 

 (B) the denominator of which shall be equal to the number of shares of Outstanding Common
Stock immediately after the issuance of such Additional Shares of Common Stock. 
 (ii) The provisions of
Section 4(d)(i) shall not apply to any issuance of Additional Shares of Common Stock for which an adjustment is provided under Section 4(b) or 4(c). 
 (e) Issuance of Warrants or Other Rights. In the event the Issuer shall (whether directly or by assumption in a merger in which the Issuer is the
surviving corporation) issue or sell, any warrants or other rights to subscribe for or purchase any Additional Shares of Common Stock or any Convertible Securities, whether or not the rights to exchange or convert thereunder are immediately
exercisable (other than Permitted Issuances), and the price per share for which Common Stock is issuable upon the exercise of such warrants or other rights shall be less than the Warrant Price in effect immediately prior to the time of such issue or
sale, then the Warrant Price shall be adjusted as provided in Section 4(d) on the basis that the maximum number of Additional Shares of Common Stock issuable pursuant to all such warrants or other rights or necessary to effect the
conversion or exchange of all such Convertible Securities shall be deemed to have been issued and outstanding and the Issuer shall have received all of the consideration payable therefor, if any, as of the date of the actual issuance of the number
of shares for which this Warrant is exercisable and such warrants or other rights. No further adjustments of the Warrant Price shall be made upon the actual issue of such Common Stock or of such Convertible Securities upon exercise of such warrants
or other rights or upon the actual issue of such Common Stock upon such conversion or exchange of such Convertible Securities. 
 (f)
Issuance of Convertible Securities. In the event the Issuer shall (whether directly or by assumption in a merger in which the Issuer is the surviving corporation) issue or sell any Convertible Securities, other than pursuant to Permitted
Issuances, whether or not the rights to exchange or convert thereunder are immediately exercisable, and the price per share for which Common Stock is issuable upon such conversion or exchange shall be less than the Warrant Price in effect
immediately prior to the time of such issue or sale, then the Warrant Price shall be adjusted as provided in Section 4(d) on the basis that the maximum number of Additional Shares of Common Stock necessary to effect the conversion or
exchange of all such Convertible Securities shall be deemed to have been issued and outstanding and the Issuer shall have received all of the consideration payable therefor, if any, as of the date of actual issuance of such Convertible Securities.
No adjustment of the Warrant Price shall be made under this Section 4(f) upon the issuance of any Convertible Securities that are issued pursuant to the exercise of any warrants or other subscription or purchase rights therefor, if any
such adjustment shall previously have been made upon the issuance of such warrants or other rights pursuant to Section 4(e). No further adjustments of the Warrant Price shall be made upon the actual issue of such Common Stock upon
conversion or exchange of such Convertible Securities and, if any issue or sale of such Convertible Securities is made upon exercise of any warrant or other right to subscribe for or to purchase any such Convertible Securities for which adjustments
of the Warrant Price have been or are to be made pursuant to other provisions of this Section 4, no further adjustments of the Warrant Price shall be made by reason of such issue or sale. 
  

 - 8 - 

 (g) Superseding Adjustment. If, at any time after any adjustment of the number of shares of Common
Stock for which this Warrant is exercisable and the Warrant Price then in effect shall have been made pursuant to Section 4(c) as the result of any issuance of warrants, other rights or Common Stock Equivalents, and (i) such warrants or
other rights, or the right of conversion or exchange in such other Common Stock Equivalents, shall expire, and all or a portion of such warrants or other rights, or the right of conversion or exchange with respect to all or a portion of such other
Common Stock Equivalents, as the case may be, shall not have been exercised, or (ii) the consideration per share for which shares of Common Stock are issuable pursuant to such Common Stock Equivalents, shall be increased solely by virtue of
provisions therein contained for an automatic increase in such consideration per share upon the occurrence of a specified date or event, then for each outstanding Warrant such previous adjustment shall be rescinded and annulled and the Additional
Shares of Common Stock which were deemed to have been issued by virtue of the computation made in connection with the adjustment so rescinded and annulled shall no longer be deemed to have been issued by virtue of such computation. Upon the
occurrence of an event set forth in this Section 4(g) above, there shall be a recomputation made of the effect of such Common Stock Equivalents on the basis of: (i) treating the number of Additional Shares of Common Stock or other
property, if any, theretofore actually issued or issuable pursuant to the previous exercise of any such warrants or other rights or any such right of conversion or exchange, as having been issued on the date or dates of any such exercise and for the
consideration actually received and receivable therefor, and (ii) treating any such Common Stock Equivalents which then remain outstanding as having been granted or issued immediately after the time of such increase of the consideration per
share for which shares of Common Stock or other property are issuable under such Common Stock Equivalents; whereupon a new adjustment of the number of shares of Common Stock for which this Warrant is exercisable and the Warrant Price then in effect
shall be made, which new adjustment shall supersede the previous adjustment so rescinded and annulled. 
 (h) Reduction of Warrant
Exercise Price by Issuer. If the Issuer at any time while this Warrant is outstanding shall offer the Holder the opportunity to exercise this Warrant at a price per share less than the applicable Warrant Price (each, a “Special Warrant
Offer”), then the Warrant Price then in effect shall be reduced to the exercise price offered pursuant to the Special Warrant Offer. Notwithstanding anything to the contrary contained in this Warrant, any adjustment of the Warrant Price
made pursuant to this paragraph shall not survive the expiration of a Special Warrant Offer unless the Holder participates in such Special Warrant Offer (to the fullest extent permitted by the Issuer). 
 (i) Other Provisions applicable to Adjustments under this Section. The following provisions shall be applicable to the making of adjustments of
the Warrant Price then in effect provided for in this Section 4: 
 (i) When Adjustments to Be Made. The
adjustments required by this Section 4 shall be made whenever and as often as any specified event requiring an adjustment shall occur, except that any adjustment of the number of shares of Common Stock for which this Warrant is exercisable that
would otherwise be required may be postponed (except in the case of a subdivision or combination of shares of the Common Stock, as provided for in Section 4(b)) up to, but not beyond the date of exercise if such adjustment either by itself or
with other adjustments not previously made adds or subtracts less than one percent (1%) of the shares of 

  

 - 9 - 

 
Common Stock for which this Warrant is exercisable immediately prior to the making of such adjustment. Any adjustment representing a change of less than such
minimum amount (except as aforesaid) which is postponed shall be carried forward and made as soon as such adjustment, together with other adjustments required by this Section 4 and not previously made, would result in a minimum adjustment or on
the date of exercise. For the purpose of any adjustment, any specified event shall be deemed to have occurred at the close of business on the date of its occurrence. 
 (ii) Fractional Interests. In computing adjustments under this
Section 4, fractional interests in Common Stock shall be taken into account to the nearest one one-hundredth (1/100th) of a share.

 (iii) When Adjustment Not Required. If the Issuer shall take a record of the holders of its Common Stock for the
purpose of entitling them to receive a dividend or distribution or subscription or purchase rights and shall, thereafter and before the distribution to stockholders thereof, legally abandon its plan to pay or deliver such dividend, distribution,
subscription or purchase rights, then thereafter no adjustment shall be required by reason of the taking of such record and any such adjustment previously made in respect thereof shall be rescinded and annulled. 
 (j) Form of Warrant after Adjustments. The form of this Warrant need not be changed because of any adjustments in the Warrant Price or the number
and kind of Securities purchasable upon the exercise of this Warrant. 
 (k) Escrow of Warrant Stock. If, after any property becomes
distributable pursuant to this Section 4 by reason of the taking of any record of the holders of Common Stock, but prior to the occurrence of the event for which such record is taken, the Holder exercises this Warrant, any shares of Common
Stock issuable upon exercise by reason of such adjustment shall be deemed the last shares of Common Stock for which this Warrant is exercised (notwithstanding any other provision to the contrary herein) and such shares or other property shall be
held in escrow for the Holder by the Issuer to be issued to the Holder upon and to the extent that the event actually takes place, upon payment of the current Warrant Price. Notwithstanding any other provision to the contrary herein, if the event
for which such record was taken fails to occur or is rescinded, then such escrowed shares shall be cancelled by the Issuer and escrowed property returned. 
 5. Notice of Adjustments. Whenever the Warrant Price shall be adjusted pursuant to Section 4 hereof (for purposes of this Section 5, each an “adjustment”), the Issuer shall cause its Chief
Financial Officer to prepare and execute a certificate setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated (including a description of the basis on
which the Board made any determination hereunder), and the Warrant Price after giving effect to such adjustment, and shall cause copies of such certificate to be delivered to the Holder of this Warrant promptly after each adjustment. 
 6. Fractional Shares. No fractional shares of Warrant Stock will be issued in connection with and exercise hereof. If any fraction of a share of
Common Stock would, except for the provisions of this Section, be issuable on the exercise hereof, the Issuer will (i) round down and issue to the Holder only the largest whole number of shares of Common Stock to 

  

 - 10 - 

 
which the Holder is otherwise entitled if the fraction of a share otherwise issuable is less than one-half, or (2) round up and issue to the Holder one
additional share of Common Stock in addition to the largest whole number of shares of Common Stock to which the Holder is otherwise entitled, if the fraction of a share of Common Stock otherwise issuable is equal to or greater than one-half. The
determination as to whether or not any fractional shares are issuable shall be based upon the total number of shares of Common Stock for which warrants are being exercised at any one time by the Holder hereof, not upon each warrant being exercised.

 7. Ownership Cap and Certain Exercise Restrictions. (a) Notwithstanding anything to the contrary set forth in this Warrant, at
no time may a Holder of this Warrant exercise this Warrant if the number of shares of Common Stock to be issued pursuant to such exercise would exceed, when aggregated with all other shares of Common Stock beneficially owned (as determined in
accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules thereunder) by such Holder at such time, the number of shares of Common Stock which would result in such Holder
beneficially owning in excess of 4.9% of all of the Outstanding Common Stock at such time; provided, however, that upon the Holder of this Warrant providing the Issuer with sixty-one (61) days notice (pursuant to Section 13
hereof) (the “Waiver Notice”) that such Holder would like to waive this Section 7(a) with regard to any or all shares of Common Stock issuable upon exercise of this Warrant (and upon consent of the Issuer, which will not be
unreasonably withheld), this Section 7(a) shall be of no force or effect with regard those shares of Warrant Stock referenced in the Waiver Notice. 
 (b) Notwithstanding anything to the contrary set forth in Section 7 of this Warrant, at no time may the Holder exercise all or a portion of this Warrant if the number of shares of Common Stock to be issued
pursuant to such conversion, when aggregated with all other shares of Common Stock beneficially owned (as determined in accordance with Section 13(d) of the Exchange Act and the rules thereunder) by the Holder at such time, would result in the
Holder beneficially owning (as determined in accordance with Section 13(d) of the Exchange Act and the rules thereunder) in excess of 9.9% of all of the Outstanding Common Stock at such time. 
 (c) In the event that the operation of this Section 7 prevents the Holder from fully exercising this Warrant, such Holder may elect
to receive Series C Convertible Preferred Stock of the Issuer in lieu of shares of Common Stock convertible into the number of shares of Common Stock that would have been delivered to such Holder but for the limitations set forth in this
Section 7. The foregoing sentence shall not preclude the Holder from waiving at any time its rights to limit its ownership to 4.9% of all of the Outstanding Common Stock at such time in accordance with Section 7(a) hereof. “Series C
Convertible Preferred Stock” means a series of non-voting preferred stock of the Issuer with terms such that a holder thereof shall not be deemed a beneficial owner (as determined in accordance with Section 13(d) of the Exchange Act and
the rules thereunder) of the Common Stock issuable upon conversion thereof, and otherwise with terms similar to the Common Stock. 
 8.
Call. Notwithstanding anything herein to the contrary, the Issuer, at its option, may call up to one hundred percent (100%) of this Warrant by providing the Holder of this Warrant written notice pursuant to Section 13 (the
“Call Notice”) if the Per Share Market Value of the Common Stock has been equal to or greater than $3.00 (as may be adjusted for any stock splits or combinations of the Common Stock) for a period of twenty (20) consecutive
Trading 

  

 - 11 - 

 
Days immediately prior to the date of delivery of the Call Notice. The rights and privileges granted pursuant to this Warrant with respect to the shares of
Warrant Stock subject to the Call Notice (the “Called Warrant Shares”) shall expire on the 10th Trading Day after the Holder
receives the Call Notice (the “Early Termination Date”) if this Warrant is not exercised with respect to such Called Warrant Shares prior to such Early Termination Date. In the event this Warrant is not exercised with respect to the
Called Warrant Shares, the Issuer shall remit to the Holder of this Warrant (1) $0.01 per Called Warrant Share and (2) a new Warrant representing the number of shares of Warrant Stock, if any, which shall not have been subject to the Call
Notice upon the Holder tendering to the Issuer the applicable Warrant certificate. The Issuer may not provide a Call Notice, and any attempt to issue a Call Notice or require the cancellation of this Warrant shall be voidable, to the extent that:
(V) a Holder would be unable, pursuant to Section 7, to exercise the Warrant; or (W) the Holder is in possession of any information provided by the Issuer to the Holder that constitutes, or reasonably might constitute, material
non-public information; (X) the Issuer has failed to honor any attempted exercise of the Warrants as of 6:30 p.m. New York City time on the date of the Call Notice; (Y) at any time between the date of the Call Notice and Early Termination
Date the Common Stock is neither listed on a securities exchange or market nor quoted on the OTC Bulletin Board or the Pink Sheets, LLC (or similar organization or agency succeeding to its functions of reporting prices) and the average daily volume
for such measurement period exceeds $100,000 per Trading Day; or (Z) the issuance of the Warrant Stock would cause a breach of the covenants in Sections 3(a) or 3(c). 
 9. Definitions. For the purposes of this Warrant, the following terms have the following meanings: 
 “Additional Shares of Common Stock” means all shares of Common Stock (including Common Stock Equivalents) issued or
issuable by the Issuer after the Original Issue Date, and all shares of Other Common, if any, issued by the Issuer after the Original Issue Date, other than Permitted Issuances. 
 “Board” shall mean the Board of Directors of the Issuer. 
 “Capital Stock” means and includes (i) any and all shares, interests, participations or other equivalents of or
interests in (however designated) corporate stock, including, without limitation, shares of preferred or preference stock, (ii) all partnership interests (whether general or limited) in any Person which is a partnership, (iii) all
membership interests or limited liability company interests in any limited liability company, and (iv) all equity or ownership interests in any Person of any other type. 
 “Certificate of Incorporation” means the Certificate of Incorporation of the Issuer as in effect on the Original Issue
Date, and as hereafter from time to time amended, modified, supplemented or restated in accordance with the terms hereof and thereof and pursuant to applicable law. 
 “Common Stock” means the Common Stock, par value $0.001 per share, of the Issuer and any other Capital Stock into which
such stock may hereafter be changed. 
  

 - 12 - 

 “Common Stock Equivalent” means any Convertible Security or warrant,
option or other right to subscribe for or purchase any Additional Shares of Common Stock or any Convertible Security. 
 “Convertible Securities” means evidences of indebtedness, shares of Capital Stock or other Securities which are or may be at any time convertible into or exchangeable for Additional Shares of Common Stock. The term
“Convertible Security” means one of the Convertible Securities. 
 “Governmental Authority” means
any governmental, regulatory or self-regulatory entity, department, body, official, authority, commission, board, agency or instrumentality, whether federal, state or local, and whether domestic or foreign. 
 “Holders” mean the Persons who shall from time to time own any Warrant. The term “Holder” means one of the
Holders. 
 “Issuer” means FLO Corporation, a Delaware corporation, and its successors. 
 “Majority Holders” means at any time the Holders of Warrants exercisable for a majority of the shares of Warrant Stock
issuable under the Warrants at the time outstanding. 
 “Original Issue Date” means April 3, 2008.

 “OTC Bulletin Board” means the over-the-counter electronic bulletin board. 
 “Other Common” means any other Capital Stock of the Issuer of any class which shall be authorized at any time after the
date of this Warrant (other than Common Stock) and which shall have the right to participate in the distribution of earnings and assets of the Issuer without limitation as to amount. 
 “Outstanding Common Stock” means, at any given time, the aggregate amount of outstanding shares of Common Stock, assuming
full exercise, conversion or exchange (as applicable) of all options, warrants and other Securities which are convertible into or exercisable or exchangeable for, and any right to subscribe for, shares of Common Stock that are outstanding at such
time. 
 “Permitted Issuances” means: 
 (1) Securities issued (other than for cash) in connection with a merger, acquisition or consolidation; 
 (2) Shares of Common Stock issued pursuant to (A) a dividend or other distribution on outstanding Common Stock of the Issuer,
(B) a subdivision of outstanding shares of Common Stock into a greater number of shares of Common Stock, or (C) a combination of outstanding shares of Common Stock into a smaller number of shares of Common Stock; 
  

 - 13 - 

 (3) Securities issued or issuable pursuant to any Issuer stock option plan, stock
purchase plan, or other equity incentive plan or agreement approved by the Board; 
 (4) Securities issued to financial
institutions or lessors in connection with commercial credit arrangements, equipment financings or similar transactions approved by the Board; 
 (5) Securities issued pursuant to a bona fide, firm underwritten public offering of the Issuer’s securities; 
 (6) Securities issued or issuable pursuant to the conversion or exercise of convertible securities issued or outstanding on or prior to the date hereof and not amended after the date hereof, pursuant to the conversion
of the Series C Convertible Preferred Stock, or pursuant to the Purchase Agreement or that certain Exchange Agreement dated as of April 3, 2008, by and among the Issuer and the holders signatory thereto (the “Exchange
Agreement”); 
 (7) Securities convertible into Common Stock issued in lieu of cash interest payments to holders of
the Issuer’s securities entitled to interest; 
 (8) Securities issued in connection with bona fide strategic
collaborations, development agreements or licensing transactions approved by the Board; 
 (9) Securities issuable as a result
of the application of similar antidilution provisions in respect of any other Securities; 
 (10) Securities issued to any
placement agent and/or its designees in connection with any offering or financing of the Issuer; 
 (11) Securities issued by
way of dividend or other distribution, or upon the exercise or conversion of, any securities included in this definition of Permitted Issuances; and 
 (12) Such additional Securities that are designated in writing as included in this definition of Permitted Issuances by the holders of a majority of the Warrants. 
 “Person” means an individual, corporation, limited liability company, partnership, joint stock company, trust,
unincorporated organization, joint venture, Governmental Authority or other entity of whatever nature. 
 “Per Share
Market Value” means on any particular date (a) the closing bid price per share of the Common Stock on such date on any registered national stock exchange on which the Common Stock is then listed, or if there is no such price on such
date, then the closing bid price on such exchange or quotation system on the date nearest preceding such date, or (b) if the Common Stock is not listed then on any registered national stock exchange, the closing bid price for a share of Common
Stock in the over-the-counter 

  

 - 14 - 

 
market, as reported by the OTC Bulletin Board or in the Pink Sheets, LLC (or similar organization or agency succeeding to its functions of reporting prices)
at the close of business on such date, or (c) if the Common Stock is not then reported by the OTC Bulletin Board or the Pink Sheets, LLC (or similar organization or agency succeeding to its functions of reporting prices), then the average of
the “Pink Sheet” quotes for the relevant conversion period, as determined in good faith by the Holder, or (d) if the Common Stock is not then publicly traded the fair market value of a share of Common Stock as determined by the Board
in good faith. 
 “Purchase Agreement” means the Note and Warrant Purchase Agreement dated as of
April 3, 2008, by and among the Issuer and the purchasers listed therein. 
 “Securities” means any debt
or equity securities of the Issuer, whether now or hereafter authorized, any instrument convertible into or exchangeable for Securities or a Security, and any option, warrant or other right to purchase or acquire any Security. “Security”
means one of the Securities. 
 “Securities Act” means the Securities Act of 1933, as amended, or any similar
federal statute then in effect. 
 “Subsidiary” means any corporation at least 50% of whose outstanding
Voting Stock shall at the time be owned directly or indirectly by the Issuer or by one or more of its Subsidiaries, or by the Issuer and one or more of its Subsidiaries. 
 “Term” has the meaning specified in Section 1 hereof. 
 “Trading Day” means (a) a day on which the Common Stock is traded on any registered national stock exchange, or
(b) if the Common Stock is not traded on any registered national stock exchange, a day on which the Common Stock is traded on the OTC Bulletin Board, or (c) if the Common Stock is not traded on the OTC Bulletin Board, a day on which the
Common Stock is quoted in the over-the-counter market as reported by the Pink Sheets, LLC (or any similar organization or agency succeeding its functions of reporting prices); provided, however, that in the event that the Common Stock
is not listed or quoted as set forth in (a), (b) and (c) hereof, then Trading Day shall mean any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the State of New York are
authorized or required by law or other government action to close. 
 “Voting Stock” means, as applied to the
Capital Stock of any corporation, Capital Stock of any class or classes (however designated) having ordinary voting power for the election of a majority of the members of the Board of Directors (or other governing body) of such corporation, other
than Capital Stock having such power only by reason of the happening of a contingency. 
 “Warrants” means
the Warrants issued and sold pursuant to the Purchase Agreement, including, without limitation, this Warrant, and any other warrants of like tenor issued in substitution or exchange for any thereof pursuant to the provisions of Section 2(c) or
2(d) hereof or of any of such other Warrants. 
  

 - 15 - 

 “Warrant Price” initially means U.S. $0.75, as such price may be
adjusted from time to time pursuant to the terms of this Warrant, including Section 4 hereto. 
 “Warrant Share
Number” means at any time the aggregate number of shares of Warrant Stock which may at such time be purchased upon exercise of this Warrant, after giving effect to all prior adjustments and increases to such number made or required to be
made under the terms hereof. 
 “Warrant Stock” means Common Stock issuable upon exercise of any Warrant or
Warrants or otherwise issuable pursuant to any Warrant or Warrants. 
 10. Other Notices. In case at any time: 
  

	 	(A)	the Issuer shall make any distributions to the holders of Common Stock; or 

  

	 	(B)	the Issuer shall authorize the granting to all holders of its Common Stock of rights to subscribe for or purchase any shares of Capital Stock of any class or other rights; or

  

	 	(C)	there shall be any reclassification of the Capital Stock of the Issuer; or 

  

	 	(D)	there shall be any capital reorganization by the Issuer; or 

  

	 	(E)	there shall be any (i) consolidation or merger involving the Issuer or (ii) sale, transfer or other disposition of all or substantially all of the Issuer’s property,
assets or business (except a merger or other reorganization in which the Issuer shall be the surviving corporation and its shares of Capital Stock shall continue to be outstanding and unchanged and except a consolidation, merger, sale, transfer or
other disposition involving a wholly-owned Subsidiary); or 

  

	 	(F)	there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Issuer or any partial liquidation of the Issuer or distribution to holders of Common Stock;

 then, in each of such cases, the Issuer shall give written notice to the Holder of the date on which (i) the books of the Issuer shall
close or a record shall be taken for such dividend, distribution or subscription rights or (ii) such reorganization, reclassification, consolidation, merger, disposition, dissolution, liquidation or winding-up, as the case may be, shall take
place. Such notice also shall specify the date as of which the holders of Common Stock of record shall participate in such dividend, distribution or subscription rights, or shall be entitled to exchange their certificates for Common Stock for
securities or other property deliverable upon such 

  

 - 16 - 

 
reorganization, reclassification, consolidation, merger, disposition, dissolution, liquidation or winding-up, as the case may be. Such notice shall be given
at least twenty (20) days prior to the action in question and not less than ten (10) days prior to the record date or the date on which the Issuer’s transfer books are closed in respect thereto. This Warrant does not entitle the
Holder to any voting rights or others rights as a stockholder of the Issuer prior to exercise and payment of the Warrant Price in accordance with Section 2 hereof. 
 11. Amendment and Waiver. Any term, covenant, agreement or condition in this Warrant may be amended, or compliance therewith may be waived (either generally or in a particular instance and either retroactively
or prospectively), by a written instrument or written instruments executed by the Issuer and the Majority Holders; provided, however, that no such amendment or waiver shall reduce the Warrant Share Number, increase the Warrant Price,
shorten the period during which this Warrant may be exercised or modify any provision of this Section 11 without the consent of the Holder of this Warrant. 
 12. Governing Law. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW. 
 13. Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and
shall be deemed given and effective on the earlier of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone number specified for notice prior to 5:00 p.m., eastern time, on a Trading
Day, (ii) the Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone number specified for notice later than 5:00 p.m., eastern time, on any date and earlier than 11:59
p.m., eastern time, on such date, (iii) the Trading Day following the date of mailing, if sent by nationally recognized overnight courier service or (iv) actual receipt by the party to whom such notice is required to be given. The
addresses for such communications shall be with respect to the Holder of this Warrant or of Warrant Stock issued pursuant hereto, addressed to such Holder at its last known address or facsimile number appearing on the books of the Issuer maintained
for such purposes, or with respect to the Issuer, addressed to: 
 FLO Corporation 
 14000 Thunderbolt Place, Building R 
 Chantilly, Virginia 20151 
 Attention: President 
 Tel. No.: (425) 278-1100 
 Fax No.: (425) 278-1299 
 Copies of notices to the Holder shall be sent as set forth on the signature page to the
Purchase Agreement. 
 Any party hereto may from time to time change its address for notices by giving at least ten (10) days written notice of such
changed address to the other party hereto. 
  

 - 17 - 

 14. Warrant Agent. The Issuer may, by written notice to each Holder of this Warrant, appoint an
agent for the purpose of issuing shares of Warrant Stock on the exercise of this Warrant, exchanging this Warrant or replacing this Warrant, in each case pursuant to the terms hereof, or any of the foregoing, and thereafter any such issuance,
exchange or replacement, as the case may be, shall be made at by such agent at the office of such agent. 
 15. Remedies. The Issuer
stipulates that the remedies at law of the Holder of this Warrant in the event of any default or threatened default by the Issuer in the performance of or compliance with any of the terms of this Warrant are not and will not be adequate and that, to
the fullest extent permitted by law, such terms may be specifically enforced by a decree for the specific performance of any agreement contained herein or by an injunction against a violation of any of the terms hereof or otherwise. 
 16. Successors and Assigns. This Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors and
assigns of the Issuer, the Holder hereof and (to the extent provided herein) the Holders of Warrant Stock issued pursuant hereto, and shall be enforceable by any such Holder or Holders of Warrant Stock. 
 17. Modification and Severability. If, in any action before any court or agency legally empowered to enforce any provision contained herein, any
provision hereof is found to be unenforceable, then such provision shall be deemed modified to the extent necessary to make it enforceable by such court or agency. If any such provision is not enforceable as set forth in the preceding sentence, the
unenforceability of such provision shall not affect the other provisions of this Warrant, but this Warrant shall be construed as if such unenforceable provision had never been contained herein. 
 18. Headings. The headings of the Sections of this Warrant are for convenience of reference only and shall not, for any purpose, be deemed a part
of this Warrant. 
  

 -18 - 

 IN WITNESS WHEREOF, the Issuer has executed this Warrant as of the day and year first above written.

  

			
	FLO CORPORATION
		
	By:	 	 
		 	Name: Glenn Argenbright
		 	Title: President and Chief Executive Officer

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