Document:

Exhibit 10.1

 

LOAN AND SECURITY AGREEMENT

 

THIS LOAN AND SECURITY
AGREEMENT (the "Agreement") made as of the 25th day of February, 2016 by and between Cantone asset Management, LLC, a
Pennsylvania limited liability company, its successors and assigns (the "Lender"), and LATTICE INCORPORATED, a Delaware
corporation, its successors and assigns (the "Borrower"). (The Lender and the Borrower are sometimes referred to collectively
in this Agreement as the "Parties" or singly as a "Party.")

 

BACKGROUND

 

At the request of and
on behalf of the Borrower, the Lender proposes to extend to the Borrower a term loan in the principal sum of Three Hundred Seventy-Five
Thousand Dollars ($375,000) (the "Loan") to purchase components and assemble a telecommunications system to be sold to
its customer ("Correct Solutions") (the "System," defined below).

 

NOW THEREFORE, in consideration
of the promises contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to the legally bound, the Parties agree as follows:

 

1.Definitions. The
following terms used in this Agreement shall have the meanings set forth below:

 

(a)"Agreement" means this Agreement.

 

(b)"Business
Day" shall mean any day other than a Saturday, a Sunday, a United States federal government legal holiday or a day on which banking institutions are authorized or required by law or other
governmental action to close in the State of New Jersey.

 

(c)"Collateral"
means the collateral in which the Lender is granted a security interest by this Agreement and which shall include the following: all of the Borrower's right, title and interest in a certain
purchase order (a copy of which is attached as Exhibit A), components, work-in-progress, accounts receivable and the proceeds of
the foregoing under that certain agreement with Correct Solutions, and all proceeds, products and accounts thereof; including all
insurance proceeds, and rights to refunds or indemnification whatsoever owing, together with all instruments, all documents of
title representing any of the foregoing, all rights in any merchandising, goods, equipment, which any of the same may represent,
and all right, title, security and guaranties with respect to each account receivable.

 

(c)"Loan Documents"
means this Agreement, the $375,000 Note of even date from Borrower to Lender (the "Note"), the UCC-1 Financing Statement
naming Borrower as debtor and Lender as secured party to be filed with the New Jersey Department of State and all other loan documents
listed on the Closing Checklist attached as Exhibit B, including all riders, supplements and addenda to such documents.

 

(d)"Loan"
means the $375,000 Loan, as advanced, extended and otherwise made under this Agreement.

 

    	 	1	 

     

    

 

(e)"Person"
shall mean any individual, sole proprietorship, partnership, joint venture, limited liability company, limited liability
partnership, trust, incorporated organization, association, corporation, institution, entity, party or government (including any
division, agency or department thereof), and, as applicable, the successors, heirs and assigns of each.

 

(f)"Principal Amount" means $375,000.

 

(g)"System" means the telecommunications
system sold to Correct Solutions which is the subject of the purchase order attached as Exhibit A.

 

(g)"Taxes"
mean any federal, state, local or foreign income sales, use, transfer, payroll, property, occupancy, franchise or other tax,
levy, impost, fee, imposition, assessment or similar charge, together with any interest or penalties thereon.

 

(i)"UCC" shall mean the Uniform
Commercial Code as in effect from time to time in the State of New Jersey.

 

2.Terms of the Loan.

 

(a)Lender
agrees to extend the Loan to Borrower in order to (i) first, to purchase components and assemble the System, and (ii) second,
for working capital purposes. The term of the Loan (the "Term") shall be for six months from the date of closing of
this transaction (the "Closing Date") or the date on which Correct Solutions pays the for the System, whichever is earlier.

 

(b)The
Parties agree that the Closing Date is to be no later than February 26, 2016 and the Parties will use their best efforts to complete this transaction by the Closing Date or as soon as practicable thereafter.

 

(c)Borrower
will pay interest at fourteen percent (14%) annually (the "Interest Rate"), with interest accruing on the outstanding principal amount beginning on the Closing Date paid monthly, interest only,
on the tenth day of the month for the previous month, with the first payment of interest due March 26, 2016. Upon an Event of Default
as defined in the Note or in this Agreement, the interest rate will increase to 18% (the "Default Rate"). Interest on
the Note will accrue at the Default Rate until all defaults have been cured.

 

(d)The
outstanding unpaid principal amount of the Loan and all accrued but unpaid interest shall be paid in full on the earlier of: (i) May 26, 2016, or (ii) the date Correct Solutions pays for the System
(in either case, the "Due Date"). The Borrower has the right to repay the principal amount and accrued interest at any
time before the Due Date. To the extent that the Lender receives payments from Correct Solutions, the Lender will apply such payments
as described in the Note.

 

(e)To
evidence the obligation of Borrower to Lender to repay the Loan with interest at the Interest Rate in accordance with the provisions of this Agreement, Borrower shall execute and deliver to Lender
at Closing the Note, a form of which is attached as Exhibit C.

 

    	 	2	 

     

    

 

(f)To secure the
Note, Borrower shall execute and deliver to Lender at Closing and cause to be filed a UCC-1 Financing Statement, which grants to Lender a perfected first security interest in the Collateral
(the "Financing Statement").

 

(g)Borrower shall
have a subordination agreement signed by its existing accounts receivable lender to evidence Lender's first lien on the System proceeds.

 

3.Fees. Borrower acknowledges that the fees and expenses payable as described in this Section will be deducted from the gross amount
of the Loan at Closing, with the Borrower receiving the net proceeds.

 

(a)At the Closing,
or within thirty (30) days thereafter, Borrower shall deliver to the Lender 600,000 shares of the Borrower's common stock, registered in the name of the Lender or to its order.

 

(b)Borrower acknowledges
that Lender will make the Loan at a 5% original issue discount, deducted at Closing.

 

(c)At the Closing,
the Borrower will also be responsible for the filing fee for the Financing Statement, which is $65.00, deducted at Closing. To the extent that the Lender or its counsel believes that it is
advisable to file a Financing Statement with any other jurisdiction (based upon the location of any Collateral), Borrower will
reimburse the Lender for any such fees upon request.

 

(d)Borrower will
pay a due diligence fee of $1,500 and a lender's legal fee of $1,500.

 

(e)Fees Upon Default.
In addition to any other remedies for an uncured Event of Default under this Agreement or the Note, upon an Event of Default that remains uncured (according to the terms of the Note),
there will be added to the principal amount of the Note then outstanding an additional $37,500 as a penalty and not as interest.

 

4.Collateral for the Loan. The Parties
agree that the collateral and security for the Loan shall be a first priority security interest in the Collateral, including the
components of the System and work-in-progress before delivery, and accounts receivable from Correct Solutions for the System.
Until the total principal amount and accrued interest has been paid to the Lender, Correct Solutions shall be instructed to make
all payments due under the purchase order or the accounts receivable directly to the Lender. Borrower will execute an irrevocable
order directing Correct Solutions to direct all payments on the Collateral to the Lender until the Lender certifies that the Lender
is paid in full. To the extent the Lender receives any amount from Correct Solutions in excess of the total amount due, the Lender
will forward such amount to the Borrower in a timely manner.

 

5.Covenants of Borrower. In addition
to the covenants and agreements of the Borrower contained in the other Loan Documents, and as long as the Loan is outstanding,
the Borrower hereby covenants and agrees as follows:

 

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(a)Except
as has been publicly disclosed by Borrower, Borrower shall promptly give notice in writing to Lender of the occurrence of any
material litigation, arbitration or governmental proceeding affecting Borrower, and of any governmental investigation or labor
dispute pending or, to the knowledge of Borrower, threatened which could reasonably be expected to interfere substantially with
normal operations of the business of Borrower or materially adversely, affect the financial condition of Borrower.

 

(b)Borrower
shall promptly give notice in writing to Lender of the occurrence of any Event of Default (as defined in the Note) and of any condition,
event, act or omission which, with the giving of notice or the lapse of time or both, would constitute an event of default under
this Agreement or under the Loan Documents.

 

(c)Any and
all payments by the Borrower hereunder or under the Note to or for the benefit of Lender shall be made free and clear of and without
deduction for any and all present or future Taxes, deductions, charges or withholdings.

 

6.Construction
of this Agreement.

 

(a)Time is
of the essence in connection with any act, undertaking or matter to be performed under this Agreement.

 

(b)This Agreement
is intended as a separate agreement between the Parties enforceable in accordance with its terms and is in addition to any other
agreements between the Parties including but not limited to the Loan Documents, and this Agreement shall not be deemed to replace,
modify, substitute for, be merged with or into or amend or alter the Loan Documents in any way except to the extent expressly provided
for herein.

 

(c)Unless
otherwise specified herein or unless the context otherwise indicates, all capitalized terms used in this Agreement shall have the
same definitions and meanings as used in and defined in the Loan Documents.

 

(d)Borrower
acknowledges that it was represented by legal counsel in connection with this Agreement and the Loan Documents and that it was
under no economic duress or other compulsion in entering into this Agreement.

 

7.Representations and Warranties of
Borrower

 

(a)Borrower hereby represents and warrants
that:

 

(i)Borrower
is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, and is duly qualified and authorized to do business and is in good standing
wherever the nature of the business conducted by Borrower makes such qualification necessary.

 

(ii)Borrower
has the corporate power and authority to own its property and to conduct its business and holds such licenses and certificates
as may be applicable and required for the conduct of its business; and Borrower has the corporate power and authority to enter
into this Agreement and to consummate all transactions contemplated in this Agreement.

 

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(iii)This Agreement
and the Loan Documents constitute valid, continuing, legal and binding obligations of Borrower and are enforceable against Borrower
in accordance with their terms, subject however, to creditors' rights generally.

 

(iv)The making
of this Agreement has been duly authorized by all necessary corporate action on the part of Borrower, including Board of Directors approval, does not require the approval of, or
the giving of notice to, any other entity or third person; and will not violate any provision of law or of Borrower's Articles
of Incorporation or Bylaws, or result in the breach of, constitute a default under, contravene any provision of, or result in the
creation of any lien, charge, encumbrance or security interest upon any property or assets of Borrower.

 

(v)The individuals
executing this Agreement on behalf of Borrower are duly authorized officers of Borrower and are authorized to execute this Agreement and to take any and all other actions contemplated
or required by this Agreement.

 

(vi)Except as has
been publicly disclosed by Borrower, there are no suits or proceedings pending or, to the knowledge of Borrower, threatened in any court or before any regulatory commission, board
or other administrative or governmental agency against Borrower, which if adversely determined would have a material adverse effect
on the financial condition of Borrower or the business of Borrower or which if determined adversely to the Borrower would result
in the inability of Borrower to perform this Agreement.

 

(vii)The Financing
Statement constitutes a valid and enforceable security interest in the Collateral described therein.

 

(ix)There are no
mortgages, pledges, security interests, liens, charges, leases, encumbrances or claims on or with respect to the System, or any part thereof, or any title interest therein or any proceeds
thereof, which have a priority superior to the lien and priority positions of the Lender's security interest.

 

(x)As of the date
of this Agreement, Borrower is not insolvent as defined by the United States Bankruptcy Code, the Delaware Fraudulent Conveyances Act, by the insolvency provisions of the Delaware
Business Corporation Law or by law or usage of any court of law or equity of the State of Delaware.

 

(xi)As of the date
of this Agreement, Borrower has complied with all the terms and conditions of this Agreement.

 

(xii)The
execution, delivery and performance of this Agreement and the Loan Documents will not violate any provisions of any
indenture, agreement, or other instrument to which Borrower or any of Borrower's properties or assets are bound,
and will not be in conflict with, result in a breach of, or constitute (with due notice and/or lapse of time) a default under
any such indenture, agreement, or other instrument, or result in the creation or imposition of any lien, charge, or
encumbrance of any nature whatsoever upon any of the properties or assets of Borrower.

 

    	 	5	 

     

    

 

(xiii)No
authorization, consent, approval, license or exemption of, and no registration, qualification, designation, declaration or filing
with any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign is necessary
to the valid execution and delivery of this Agreement, the Loan Documents or any other documents evidencing or relating to the
Loan.

 

(xiv)The
most recent financial statements of Borrower delivered to the Lender represent fairly its financial position as of the date thereof;
and the results of its operations for the period indicated; and show all known liabilities, direct or contingent, of Borrower as
of the date thereof. Since the date of such financial statements, there has been no material adverse change in the condition, financial
or otherwise, of Borrower or in the business and properties of Borrower and, since such date, Borrower has not incurred, other
than in the ordinary course of business, any indebtedness, liabilities, obligations or commitments, contingent or otherwise.

 

(xv)Neither
this Agreement nor any other document, statement, financial statement, or certificate furnished to Lender by or on behalf of Borrower
in connection herewith, contains an untrue statement of a material fact with respect to the financial condition or properties of
Borrower or omits to state a material fact necessary to make the statements contained therein not misleading or, insofar as Borrower
can now foresee, may in the future materially adversely affect the financial condition or properties of Borrower which has not
been set forth in this Agreement or in a document, statement, financial statement or certificate furnished to Lender in connection
herewith.

 

(xvi)The
Borrower is in compliance with all laws, rules, regulations, judgments, decrees, orders, agreements and requirements which affect
in any material way the Borrower, its assets or the operation of its business and has not received, and has no knowledge of, any
order or notice of any governmental investigation or of any violation or claim of violation of any law, regulation, judgment, decree,
order, agreement, or other governmental requirement. Except as has been publicly disclosed by Borrower, the Borrower is not in
material default under any term of any indenture, contract, lease, agreement, instrument or other commitment to which any of them
is a party or by which any of them is bound. The Borrower knows of no dispute regarding any indenture, contract, lease, agreement,
instrument or other commitment which could reasonably be expected to have a material adverse effect on the Borrower's financial
condition.

 

(b)Borrower hereby confirms, represents
and warrants that the representations and warranties set out in the Loan Documents are true and correct as of the date of this
Agreement.

 

 

    	 	6	 

     

    

 

8.Further
Events of Default - Remedies

 

(a)The following
events shall be an Event of Default under the Loan and in addition to the Events of Default as defined in the Note; and
Lender shall thereupon have the option (which is not intended to diminish, alter or limit Lender's rights described in this Agreement,
the Loan Documents or any related instruments, agreements and documents) to declare Borrower in default under this Agreement and
the Loan Documents, and all other agreements with Lender, and declare all existing and future liabilities, indebtedness and obligations
accelerated and immediately due and payable, including, but not limited to, interest, principal, expenses, advances to protect
Lender's position and reasonable counsel fees to enforce this Agreement, the Loan Documents, and all related instruments, agreements
and documents, and all of Lender's rights hereunder and thereunder, all without demand, notice, presentment or protest, or
further action of any kind, except as specified herein.

 

(i)If
Lender shall discover evidence that any warranty, representation or statement made or furnished to Lender by or on behalf of Borrower in connection with this Agreement or otherwise, or to induce
Lender to enter into this Agreement, was false or misleading in any material respect when made or furnished.

 

(ii)If
any action, suit or proceeding is brought in law or in equity or in any bankruptcy or receivership proceeding by Borrower or any of its creditors or any other party to enjoin or set aside this Agreement.

 

(iii)If
Borrower shall fail to pay any principal, interest, costs and fees when due under the Loan Documents or this Agreement within five (5) days after written notice from Lender to Borrower.

 

(iv)The
dissolution, termination of existence, insolvency, business failure, appointment of a receiver of, or of any part of the property of, or the commencement of any proceeding under any bankruptcy,
arrangement, reorganization or insolvency laws by or against Borrower.

 

(v)If
Borrower shall fail to observe or perform any obligation or covenant to be observed or performed by Borrower hereunder or under any of the Loan Documents, which are not cured within ten (10)
days following written notice from Lender to Borrower.

 

(vi)If
any financial statement, material representation, warranty, statement or certificate made or furnished to Lender in, or in connection with, this Agreement, or as inducement to Lender to enter
into this Agreement, or in any separate statement or document to be delivered hereunder to Lender, shall be materially false, incorrect,
or misleading when made;

 

(vii)If
Borrower shall admit an inability to pay its debts as they mature, or shall make a general assignment for the benefit of its or
any of its creditors.

 

(viii)If
proceedings in bankruptcy, or for reorganization of Borrower, or for the readjustment of any of its debts, under the Bankruptcy
Code, as amended, or any part thereof; or under any other laws, whether state or federal, for the
relief of debtors, now or hereafter existing, shall be commenced by Borrower, or shall be commenced against Borrower and shall
not be dismissed within sixty (60) days of its commencement.

 

    	 	7	 

     

    

 

(ix)If a receiver or trustee shall be appointed
for Borrower or for any substantial part of its assets, or any proceedings shall be instituted for the dissolution or the full
or partial liquidation of Borrower, and if such appointment or proceedings are involuntary, such receiver or trustee shall not
be discharged within sixty (60) days of appointment, or such proceedings shall not be discharged within sixty (60) days of its
commencement, or Borrower shall discontinue its businesses or materially change the nature of its businesses.

 

(b)After any acceleration
of the Loan, Lender shall have in addition to the rights and remedies given it by this Agreement and the Loan Documents, all those
allowed by all applicable laws including, without limitation, the UCC as enacted in a jurisdiction in which any Collateral may
be located.

 

9.No Agency, Partnership or Joint Venture

 

Neither this Agreement
nor the Loan Documents nor the exercise by Lender of any of its rights or remedies hereunder or thereunder shall create, or shall
be deemed to have created (i) a relationship of principal and agent between Borrower and Lender, or (ii) a partnership or joint
venture, as between Lender and Borrower, or (iii) to render Lender in any way responsible for the debts, losses or liabilities
of Borrower, or (iv) to render Lender a principal of, an insider in, or in any manner in control of Borrower or its business affairs.

 

10.Notices

 

All notices to be given
pursuant to this Agreement shall be given by the parties hereto either by certified mail, postage pre-paid, with return receipt
requested or by expedited delivery service or by hand delivery, with a receipt being obtained therefor, at the following addresses,
or at such other addresses as to which the parties hereto may be notified in accordance herewith from time to time.

 

	If to the Borrower:	Lattice Incorporated 

7150 N. Park Drive 

Suite 500 

Pennsauken, NJ 08109 

Phone (856) 910-1166 

Fax (856) 910-1811
	 	 
	With copies to:	Mitchell Nussbaum, Esq.

Loeb & Loeb, LLP

345 Park Avenue

New York, NY 10154

Telephone: (212) 407-4159

Facsimile: (212) 504-3013

 

 

    	 	8	 

     

    

  

	If to the Lender:	Cantone Asset Management, LLC 

766 Shrewsbury Ave 

Tinton Falls, NJ 07724 

Telephone: 732-450-3500 

Facsimile: 732-450-3520 

Attention: Anthony Cantone
	 	 
	
        

        With copies to:
	
        

        Christopher P. Flannery, Esq. 

4 Hillman Drive

        Suite 104

        Chadds Ford, PA 19317 

Telephone: (610) 361-8016
        

Facsimile: (610) 558-4882

 

Notice shall be effective upon receipt.

 

11.Remedies
Are Cumulative. Lender's rights and remedies under this Agreement are cumulative and not alternative. Neither the failure
nor any delay on the part of Lender in exercising any right, power or privilege under any of the Loan Documents or this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or privilege preclude any
other or further exercise thereof or the exercise of any other right, power or privilege. No claim or right arising out of this
Agreement or the Loan Documents can be discharged by Lender in whole or in part, by a waiver or renunciation of the claim or right
unless in writing signed by Lender.

 

12.Entire Agreement.
 This Agreement and the Loan Documents are intended by the Parties as a final expression of their agreements with respect to
the subject matter thereof, and are intended as a complete and exclusive statement of the terms and conditions of that agreement.
This Agreement and the Loan Documents may not be modified, rescinded, or terminated orally, and no modification, rescission, termination
or attempted waiver of any of the provisions thereof shall be valid unless in writing, supported by consideration, and signed
by the Party against whom the same is sought to be enforced.

 

13.Assignments,
Successors and No Third Party Rights. This Agreement shall apply to and shall be binding in all respects upon, and shall inure
to the benefit of, the successors and assigns of Lender and Borrower. Except as explicitly stated herein, nothing expressed or
referred to in this Agreement is intended or shall be construed to give any person or entity other than the Parties any legal
or equitable right, remedy or claim under or with respect to this Agreement, or any provision hereof, it being the intention of
the Parties that this Agreement, and all of its provisions and conditions, are for the sole and exclusive benefit of the Parties
and for the benefit of no other person or entity and are personal to the Parties unless otherwise expressly provided.

 

14.Action
Taken at Closing. The execution and delivery of this Agreement at Closing and all other actions to be taken and
transactions to occur in connection with this Agreement at Closing, and the consummation at
Closing of certain acts and transactions to which reference is made in this Agreement, are to be and were considered effected
simultaneously as part of a number of interrelated transactions, and all deliveries of documents and other acts are to be
deemed in escrow until all transactions referred to in, and relating to, this Agreement have been completed.

 

    	 	9	 

     

    

 

15.Survival
of Representation. Warranties and Covenants. The representations, warranties and covenants set forth in this Agreement shall
survive the execution and delivery of this Agreement and the Closing.

 

16.Section
Headings, etc. The headings of Sections contained in this Agreement are provided for convenience only and form no part of
this Agreement, and shall not affect its construction or interpretation. All references to Sections and paragraphs refer to the
corresponding Sections and paragraphs in Sections of this Agreement. All words used herein shall be construed to be of such gender
or number as the circumstances require. This "Agreement" shall mean this Agreement as a whole and as the same may, from
time to time hereafter, be amended, supplemented or modified. The words "herein", "hereof', "hereby",
"hereto", "hereunder, and words of similar import, refer to this Agreement as a whole and not to any particular
Section, paragraph, clause or other subdivision hereof, unless otherwise specifically noted.

 

17.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original copy of this Agreement.

 

18.Governing
Law. This Agreement shall be governed by and construed under the laws of the Commonwealth of Pennsylvania, all rights and
remedies being governed by such laws, and any provision hereof which may prove to be unenforceable shall not affect the validity
of any other provision of this Agreement,

 

19.Amendments. This Agreement may not be amended, revised, altered or terminated except by an Agreement in writing executed by all of the
Parties.

 

20.Term of
Agreement and Reinstatement. This Agreement and the Loan Documents shall remain in full force and effect until all obligations
of Borrower under the Loan is paid in full. If any sums paid to Lender on account of the Loan are required to be returned or refunded
by Lender, this Agreement and the Loan Documents shall be revived and reinstated as to all such sums, including the liens of the
Financing Statement.

 

 

    	 	10	 

     

    

 

IN WITNESS WHEREOF,
the undersigned, intending to be legally bound hereby, have duly executed this Agreement, under seal the day and year first, above
written.

 

	SIGNED, SEALED AND DELIVERED IN THE PRESENCE OF:

	 	LENDER:

CANTONE ASSET MANAGEMENT, LLC

	 	 	 	 	 	 
	/s/ [Signature Illegible]	 	By:	/s/Anthony J. Cantone	 (SEAL)
	Witness	 	 	 	Anthony J. Cantone, Managing Member
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	BORROWER:

                    

LATTICE INCORPORATED 

a Delaware corporation

	 	 	 	 	 	 
	 	 	 	 	 	 
	/s/ Dawn Gilbert	 	By:	/s/ Paul Burgess	 (SEAL)
	Witness	 	 	 	Paul Burgess, President	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	[CORPORATE SEAL]	 
	 	 	 	 	 	 
	 	 	 	 	 	 

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT A

 

PURCHASE ORDER

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT
B

 

CLOSING CHECKLIST

 

 

 

 

 

 

 

 

 

 

 

 

    	 	13	 

     

    

 

EXHIBIT C

 

FORM OF NOTE

 

 

 

 

 

 

 

 

 

 

 

 

    	 	14Exhibit 10.2

 

14% SECURED NOTE

 

Thompson, Pennsylvania

 

	$375,000.00	February 26, 2016

 

1.Obligation.
For value received and intending to be legally bound, Lattice Incorporated, a Delaware corporation ("Maker"), hereby
promises to pay on or before the Due Date (as defined below) to the order of Cantone Asset Management, LLC (including its successors
and assigns, collectively, the "Payee"), the principal sum of THREE HUNDRED SEVENTY-FIVE Thousand Dollars ($375,000.00),
lawful money of the United States of America together with interest thereon in the amount of twelve percent annual simple interest
(the "Rate") on the terms and conditions stated in this Note. The principal sum added to the accrued but unpaid interest
is referred to in this Note as the "Amount Due." Any term capitalized herein and not defined shall have the same meaning
as in the Loan and Security Agreement between the Maker and the Payee of even date.

 

The Maker acknowledges
and represents that the loan represented by this Note is made for commercial purposes only.

 

The payments under this
Note shall be made in funds immediately available to Payee at its office at Thompson, Pennsylvania, or at such other location as
the Payee shall designate. In the event the due date of any payment under this Note is a Saturday, Sunday or legal holiday in the
Commonwealth of Pennsylvania, such payment shall be due on the next succeeding date which is not a Saturday, Sunday or such legal
holiday, provided that the principal sum shall continue to accrue interest until paid.

 

The Maker shall pay interest
on the principal amount at 14% per annum (the "Rate") until the Maker pays the entire Amount Due, payable monthly in
arrears on the twenty-sixth day of each month, with the first payment of interest due March 26, 2016. The outstanding unpaid principal
amount of the Loan and all accrued but unpaid interest shall be paid in full on the earlier of: (i) August 26, 2016, or (ii) the
date Maker receives payment from its customer for the equipment funded by this Note and described in the Loan and security agreement
of even date (in either case, the "Due Date").

 

2.Prepayment.
Maker may prepay all or any portion of the Amount Due at any time without premium or penalty.

 

3.Application
of Payments. All payments on this Note shall be applied first to interest at the Rate, then to Default Interest, as defined
below, then to all other sums due hereunder, and the balance thereof to principal or in such other order as Payee may elect.

 

4.Late Charge,
Penalty. If any payment of interest payable under Section 1, above is not made by the tenth day of the month in which it is
due, or if the Amount Due is not paid when due under the terms of this Note and remains unpaid ten (10) days after the Due Date,
then, in either case, there shall also be immediately due and payable a late charge at the rate of Five Percent (5%)
of such delinquent payment. The amount of any such late charge not paid promptly following demand therefor shall be deemed outstanding
and payable pursuant to the Note. Further, and in addition to any late fee or Default Interest, upon any uncured Event of Default
as defined in this Note or in the associated Loan Documents, there shall be added to the principal amount a penalty of $37,500,
as a penalty and not as interest.

 

    	 	1	 

     

    

 

5.Collateral.
The payment of the Amount Due on the Due Date shall be secured by a first lien on the accounts receivables, revenues and other
proceeds of a certain contract of the Maker with Correct Solutions, Inc., and the equipment used for such contract, listed on
Exhibit A, to be evidenced by a filing on form UCC-l.

 

6.Default;
Acceleration; Remedies.

 

a.Should
there occur any Default (as defined below in Section 6 b), then Payee, at its option upon written notice to Maker, may declare immediately due and payable the entire unpaid balance of Amount
Due and accrued interest by Maker hereunder, together with interest accrued thereon at the Rate to the date of Default and thereafter
at a rate of interest equal to 18% per annum (the "Default Rate"), anything herein to the contrary notwithstanding. Payment
of the Amount Due may be enforced and recovered in whole or in part at any time by one or more of the remedies provided Payee in
this Note. If Payee employs counsel to enforce this Note by suit or otherwise, Maker will reimburse Payee for all reasonable and
documented costs of suit and other reasonable and documented expenses in connection therewith, whether or not suit is actually
instituted, together with a reasonable attorney's fee for collection of Ten Percent (10%) of the total amount then due by Maker
to Payee but in no event less than five Thousand Dollars ($5,000.00) together, to the extent permitted by applicable law, with
interest on any judgment obtained by Payee at the Default Rate, including interest at the Default Rate from and after the date
of execution, judicial or foreclosure sale until actual payment is made to Payee of the full amount due Payee.

 

b.As
used in this Note, "Default" shall occur immediately upon the happening to or by Maker of any of the following events:

 

(1)Any default in the payment when
due of interest or the Amount Due on the Due Date, or any other sums due, under this Note, which default is not cured within ten (10) business days after the due
date of such payment;

 

(2)Any default
in the performance of any of the provisions of this Note, which is not cured within ten (10) business days;

 

(3)Any default
in any other indebtedness of the Maker, which default is not cured within ten (10) days of the date of such default;

 

(4)The making
of any misrepresentation to Payee;

 

(5)The calling
of a meeting of creditors;

 

    	 	2	 

     

    

 

(6)The
appointment of a committee of creditors;

 

(7)An assignment
or offer of settlement for the benefit of creditors;

 

(8)The voluntary
or involuntary application for, or appointment of, a receiver, custodian, guardian, trustee, or other personal representative for
Maker or its property;

 

(9)The filing
of a voluntary or involuntary petition under any of the provisions of the Federal Bankruptcy Code or any similar state statute;

 

(10)The occurrence
of any other act of insolvency (however expressed or indicated);

 

(11)The issuance
of a warrant of attachment or for distraint, or the notice of tax lien against Maker's assets;

 

(12)Except in
connection with any proceeding which has been disclosed publicly by the Maker, an entry of judgments against Maker or its assets;
or

 

(13)The failure
to pay, withhold, collect or remit any taxes or tax deficiency when assessed or due, unless such taxes are being diligently contested
in good faith by appropriate proceedings;

 

(14)The general
failure of Maker to pay its debts and obligations as the same become due and payable.

 

7.Remedies Cumulative, Etc.

 

a.The remedies of
Payee provided in this Note shall be cumulative and concurrent, may be pursued singly, successively, or together at the sole discretion of Payee, and may be exercised as often as
occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed as a waiver
or release thereof.

 

b.The recovery of
any judgment by Payee shall not affect in any manner or to any extent any rights, remedies or powers of Payee under this Note, but such rights, remedies and powers of Payee shall continue
unimpaired as before. The exercise by Payee of its rights and remedies and the entry of any judgment by Payee shall not adversely
affect in any way the interest rate payable hereunder on any amounts due to Payee but interest shall continue to accrue on such
amounts at the rates specified herein.

 

c.Maker agrees that
any action or proceeding against it to enforce this Note may be commenced in the state courts of the Commonwealth of Pennsylvania sitting in the County of Delaware, or in the United States
District Court for the Eastern District of Pennsylvania. The provisions of this Section shall not limit or otherwise affect the
right of Payee to institute and conduct action in any other appropriate manner, jurisdiction or court.

 

    	 	3	 

     

    

 

8.Additional
Waivers. Maker hereby waives presentment for payment, demand, demand for payment, notice of demand, notice of nonpayment or
dishonor, notice of acceleration, protest and notice of protest of this Note, and all other notices in connection with the delivery,
acceptance, performance, default or enforcement of the payment of the Note. Maker agrees that its liability shall be unconditional
without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time,
renewal, waiver or modification granted or consented to by Payee. Maker consents to any and all extensions of time, renewals,
waivers or modifications that may be granted by Payee with respect to payment or other provisions of this Note.

 

9.Costs and
Expenses. Maker shall pay upon demand all reasonable costs and expenses incurred by Payee in the exercise of any of its rights,
remedies or powers under this Note and any amount thereof not paid within ten (10) business days following demand therefor
shall be added to the principal sum hereunder and shall bear interest at the Default Rate from the date of such demand until paid
in full.

 

10.Severability.
If any provision of this Note is held to be invalid or unenforceable by a court of competent jurisdiction, the other provisions
of this Note shall remain in full force and effect and shall be liberally construed in favor of Payee in order to effectuate the
provisions of this Note.

 

11.Limitation
of Interest to Maximum Lawful Rate. In no event shall the rate of interest payable hereunder exceed the maximum rate of interest
permitted to be charged by applicable law (including choice of law rules) and any interest paid in excess of the permitted rate
shall be refunded to Maker. Such refund shall be made by application of the excessive amount of interest paid against any sums
outstanding under this Note and shall be applied on such order as Payee may determine. If the excessive amount of interest paid
exceeds the sums outstanding under this Note, the portion exceeding the sums outstanding under this Note shall be refunded in
cash by Payee. Any such crediting or refund shall not cure or waive any default by Maker hereunder. Maker agrees, however, that
in determining whether or not any interest payable under this Note exceeds the highest rate permitted by law, any non-principal
payment, including without limitation prepayment fees and late charges, shall be deemed to the extent permitted by law to be an
expense, fee, premium or penalty rather than interest.

 

12.Limitation
on Payee's Waivers. Payee shall not be deemed, by any act or omission or commission, to have waived any of its rights or remedies
hereunder unless such waiver is in writing and signed by Payee, and then only to the extent specifically set forth in the writing.
A waiver as to one event shall not be construed as continuing or as a bar to or waiver of any right or remedy to a subsequent
event.

 

13.No Offset.
The obligations of Maker under this Note shall not be subject to any abatement or offset as a consequence of any claim, event
or transaction otherwise occurring or arising between Maker, Payee and/or any affiliate of any of them, except as Maker and Payee
may otherwise agree.

 

    	 	4	 

     

    

 

14.Applicable
Law. This instrument shall be governed by and construed according to the laws of the Commonwealth
of Pennsylvania.

 

15.Captions.
The captions or headings of the paragraphs in this Note are for convenience only and shall not control or affect the meaning
or construction of any of the terms or provisions of the Note.

 

16.Pronouns.
Pronouns used herein shall be deemed to include the masculine, feminine or neuter, singular or plural, as their contexts may
require. The words "Payee" and "Maker" shall be deemed to include the respective heirs, personal representatives,
successors and assigns of Payee and Maker.

 

17.Construction.
The language in this Agreement shall be construed as a whole according to its fair meaning, strictly neither for nor against
any party, and without implying a presumption that its terms shall be more strictly construed against one party by reason of the
rule of construction that a document is to be construed more strictly against the person who drafted it.

 

18.Computation.
The unpaid principal amount of this Note, the unpaid interest accrued thereon, the interest rate or rates applicable to such
unpaid principal amount, the duration of such applicability, and all other Amounts Due owing by Maker to Payee pursuant to this
Note shall at all times be ascertained from the records of Payee, which shall be conclusive absent manifest error.

 

19.Assignment.
This Note may not be assigned or otherwise transferred by Maker without the prior written consent of Payee. This Note may
not be assigned or otherwise transferred by Payee to any person or entity that is not a "U.S. Person" as defined in
Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended.

 

20.Stamp Taxes.
Maker shall pay the cost of any revenue, tax or other stamps now or hereafter required by the laws of the Commonwealth of
Pennsylvania (or any of its political subdivisions) or the United States of America to be affixed to this note, and if any taxes
are imposed under the laws of the Commonwealth of Pennsylvania (or any of its political subdivisions) or the United States of
America with respect to evidences of indebtedness, Maker shall pay or reimburse Payee upon demand the amount of such taxes without
credit against any indebtedness evidenced by this Note.

 

21.Notices.
All notices, requests, waivers, demands and other communications hereunder shall be in writing and shall be deemed to have
been duly given, made and received when hand delivered against receipt, or on the day after it is sent by United States certified
or registered mail, postage prepaid, return receipt requested, by nationally recognized overnight courier service, or by facsimile,
to:

 

    	 	5	 

     

    

 

If to Maker:

 

Lattice Incorporated

7150 N. Park Drive

Suite 500

Pennsauken, NJ 08109

Telephone (856) 910-1166

Facsimile: (856) 910-1811

 

 

If to Payee:

 

Cantone Asset Management, LLC

Cfo Cantone Research,
Inc.

766 Shrewsbury Avenue

Suite E401

Tinton Falls, NJ 07724

Telephone: 732-450-3500

Facsimile: 732-450-3520

Attention: Anthony Cantone

 

Or such other address as shall be specified
from time to time (in compliance with the requirements of this Section 21 for the giving of notice) by the parties,. entitled to
receive such notices.

 

IN WITNESS WHEREOF,
Maker, intending to be legally bound hereby, has caused this Note to be duly executed the day and year first above written.

 

 

	 	MAKER:
	 	 	 
	 	 	 
	 	LATTICE INCORPORATED.
	 	 	 
	 	 	 
	 	 	 
	 	By:	/s/ Paul Burgess
	 	 	Paul Burgess, President

 

 

 

 

 

 

 

 

    	 	6

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