Document:

Exhibit 10.44

 

AMENDMENT NO. 1 TO THE 

AMENDED AND RESTATED EXCHANGE AND STOCKHOLDERS’
AGREEMENT

 

THIS AMENDMENT NO. 1 TO THE AMENDED AND RESTATED
EXCHANGE AND STOCKHOLDERS’ AGREEMENT (this “Amendment”) is made and entered into as of [__], 2016, by
and among Turning Point Brands, Inc. (f/k/a North Atlantic Holding Company, Inc.), a Delaware corporation (the “Company”),
North Atlantic Trading Company, Inc., a Delaware corporation (“NATC”), the Persons executing this Amendment
on the signature pages hereto and all other persons who are “Stockholders” under the Exchange and Stockholders’
Agreement dated as of June 25, 1997, as amended by the Amended and Restated Exchange and Stockholders’ Agreement dated
as of February 9, 2004 (the “Stockholders’ Agreement”), or otherwise bound by the provisions thereof
(such Persons, together with any Person who may hereafter become a stockholder party hereto as provided herein being referred to
collectively as the “Stockholders” and, individually, as a “Stockholder”). Capitalized terms
used and not otherwise defined herein shall have the meanings ascribed to them in the Stockholders’ Agreement.

 

W I T N E S S E T H

 

WHEREAS, the Company intends to effect an
initial public offering (the “IPO”) of its common stock (the “Common Stock”), pursuant to
a registration statement on Form S-1 filed with the U.S. Securities and Exchange Commission;

 

WHEREAS, in furtherance of the IPO, the Company
intends to enter into an underwriting agreement with one or more underwriters (the “Underwriting Agreement”);

 

WHEREAS, pursuant to Section 8.2 of the Stockholders’
Agreement, Stockholders holding more than 65% of the total number of shares of the Common Stock held by all Stockholders (“Majority
Stockholders”) may amend the Stockholders’ Agreement and such amendment shall be binding on all Stockholders and
the Company; and

 

WHEREAS, in furtherance of the IPO, the Majority
Stockholders wish to amend the Stockholders’ Agreement to, among other things, delete certain provisions with respect to
registration rights for the Common Stock and provide for the termination of the Stockholders’ Agreement upon the closing
of the IPO.

 

NOW, THEREFORE, in consideration of the foregoing
premises and the mutual covenants and agreements hereinafter contained, the Stockholders’ Agreement is hereby amended as
follows:

 

		1.	Registration Rights. Immediately prior to the execution of the Underwriting Agreement, Section 5.3 of the Stockholders’
Agreement shall be deleted in its entirety and shall be of no further force and effect.

 

		2.	Restricted Period. Immediately prior to the execution of the Underwriting Agreement, a new Section 3.3 of the Stockholders’
Agreement shall be inserted at the end of Article 3 as follows:

 

“3.3Restricted Period.
During the “Restricted Period” (as hereinafter defined), no Stockholder may, either directly or indirectly:

 

		(a)	Transfer any Shares held by such Stockholder immediately prior to the execution of the Underwriting Agreement (the “Restricted
Securities”); for the avoidance of doubt, if any Shares are acquired by such Stockholder after the execution of
the Underwriting Agreement in any open-market transaction, such shares shall not be deemed a “Restricted Security”
hereunder;

 

    	 

    	 

    

		(b)	enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of any of the Restricted Securities, whether such swap transaction is to be settled by delivery
of any Restricted Securities or other securities of any person, in cash or otherwise; or

 

		(c)	publicly disclose the intention to make any offer, sale, pledge or disposition, or to enter into any transaction, swap, hedge
or other arrangement relating to any of the Restricted Securities (it being understood that the foregoing shall not prohibit any
Stockholder from making any such disclosure to such Stockholder’s existing or potential shareholders, members, partners,
Affiliates, general partners, directors, officers, employees or partners, and their respective shareholders, members, partners,
Affiliates, general partners, directors, officers, employees or partners, in each case on a confidential basis).

 

As used herein, “Restricted
Period” means the period commencing on the date of the Underwriting Agreement and ending on the day preceding the day
that is six months after the closing of the IPO; provided, however, the Restricted Period shall terminate immediately prior to
the consummation of a liquidation, merger, stock exchange or other similar transaction that results in all holders of Shares having
the right to exchange their Shares for cash, securities or other property.

 

Nothing in this Section 3.3 shall
prevent the establishment by any Stockholder of any contract, instruction or plan (a “Plan”) that satisfies
all of the requirements of Rule 10b5-1(c)(1)(i)(B) under the Exchange Act; provided that it shall be a condition to the establishment
of any such Plan that no sales of the Company’s share capital shall be made pursuant to such a Plan prior to the expiration
of the Restricted Period; and provided, further, such a Plan may only be established if no public announcement of the establishment
or the existence thereof, and no filing with the U.S. Securities and Exchange Commission or any other regulatory authority shall
be required or shall be made voluntarily by such Stockholder, the Company or any other person, prior to the expiration of the Restricted
Period.

 

Also notwithstanding the foregoing
limitations, (i) any Stockholder may Transfer any or all of its Restricted Securities provided that in each and any such event
it shall be a condition to the Transfer that the transferee execute an agreement stating that the transferee is receiving and holding
the Restricted Securities subject to the provisions of this Agreement and (ii) any Stockholder may exercise any Company stock options,
including the transfer to the Company of the Shares underlying such options solely to pay the exercise price or any withholding
taxes in connection with the exercise thereof on a “cashless” or net settlement basis (it being understood that such
purchased Shares, after giving effect to the “cashless” or net settlement exercise of options shall not be deemed to
be “Restricted Securities”).”

 

		3.	Additional Definitions. Immediately prior to the execution of the Underwriting Agreement, Article 7 of the Stockholders’
Agreement shall be amended by adding to the applicable place thereto in alphabetical order each of the following definitions:

 

““IPO” shall mean
the initial public offering of the common stock of the Company pursuant to a registration statement on Form S-1 filed with the
U.S. Securities and Exchange Commission.

 

“Plan” shall have the
meaning set forth in Section 3.3.

 

“Restricted Period”
shall have the meaning set forth in Section 3.3.

 

“Restricted Securities”
shall have the meaning set forth in Section 3.3(a).

 

“Underwriting Agreement”
shall mean an underwriting agreement entered into by the Company and one or more underwriters in furtherance of the IPO.”

 

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		4.	Termination. Upon the closing of the IPO, Sections 1.1, 2.1, 2.2, 4.1, 4.2, 4.3, 4.4, 4.5, 5.1, 5.2 and 6.1 of the Stockholders’
Agreement shall terminate and be of no further force and effect, and neither the Stockholders nor the Company shall have any further
rights, obligations or duties thereunder. Upon the expiration of the Restricted Period, the Stockholders’ Agreement shall
terminate in its entirety and be of no further force and effect, and neither the Stockholders nor the Company shall have any further
rights, obligations or duties thereunder. Notwithstanding anything to the contrary contained herein, the provisions of this Section
4 shall not relieve the Company or any Stockholder from liability relating to any breach of the Stockholders’ Agreement occurring
prior to such full or partial termination.

 

		5.	Amendment. This Amendment shall not be altered, modified or changed except by an amendment approved in writing by the
Company and the Majority Stockholders. Any modification or amendment to this Amendment made in accordance with this Section 5
shall be binding on all Stockholders and the Company.

 

		6.	Effect of Amendment. Except as amended by this Amendment, the Stockholders’ Agreement remains in full force and
effect in accordance with its terms.

 

		7.	Counterparts. This Amendment may be executed in several counterparts, all of which shall constitute one agreement binding
on all parties hereto, notwithstanding that all parties have not signed the same counterpart.

 

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the parties have caused
this Amendment No. 1 to the Amended and Restated Exchange and Stockholders’ Agreement to be duly executed as of the date
first written above.

 

	 	COMPANY:
	 	 
	 	TURNING POINT BRANDS, INC.
	 	 
	 	By:	 
	 		Name:	Mark Stegeman
	 	 	Title:	Chief Financial Officer
	 	 	 	 
	 	NORTH ATLANTIC TRADING COMPANY, INC.
	 	 
	 	By:	 
	 	 	Name:	Mark Stegeman
	 	 	Title:	Chief Financial Officer
	 	 	 	 
	 	 HELMS MANAGEMENT CORP.
	 	 
	 	By:	 
	 	 	Name:	Thomas F. Helms, Jr.
	 	 	Title:	President
	 	 	 	 
	 	P STANDARD GENERAL LTD.
	 	 
	 	By:	 
	 	 	Name:	 
	 	 	Title:	 
	 	 	 	 
	 	STANDARD GENERAL FOCUS FUND L.P.
	 	 
	 	By:	 
	 	 	Name:	 
	 	 	Title:	 

 

[Signature Page to Amendment No.1 to 

Amended and Restated Exchange and Stockholders’
Agreement]

 

    	 

    	 

    

	 	FORT GEORGE INVESTMENTS LLC
	 	 
	 	By:	 
	 	 	Name:	 
	 	 	Title:	 
	 	 	 	 
	 	STANDARD GENERAL MASTER FUND L.P.
	 	 
	 	By:	 
	 	 	Name:	 
	 	 	Title:	 

 

	 	BRIAN HARRISS
	 	 
	 	 
	 	 
	 	LAWRENCE WEXLER
	 	 
	 	 
	 	 
	 	JAMES DOBBINS
	 	 
	 	 

 

[Signature Page to Amendment No.1 to 

Amended and Restated Exchange and Stockholders’
Agreement]Exhibit 4.1

 

[FORM OF SENIOR SECURED CONVERTIBLE
NOTE]

 

NEITHER THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL SELECTED BY THE HOLDER, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING,
THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES. ANY TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE TERMS OF THIS NOTE, INCLUDING SECTIONS 3(c)(iii) AND 21(a)
HEREOF. THE PRINCIPAL AMOUNT REPRESENTED BY THIS NOTE AND, ACCORDINGLY, THE SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS
THAN THE AMOUNTS SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 3(c)(iii) OF THIS NOTE.

 

Real
Goods Solar, Inc.

 

SENIOR
SECURED CONVERTIBLE NOTE

 

	Issuance Date:  April 1, 2016	Original Principal Amount: U.S. $[        ]

 

FOR VALUE RECEIVED,
Real Goods Solar, Inc., a Colorado corporation (the "Company"), hereby promises to pay to [BUYER] or registered
assigns (the "Holder") in cash and/or in shares of Common Stock (as defined below) the amount set out above as
the Original Principal Amount (as reduced pursuant to the terms hereof pursuant to redemption, conversion, amortization or otherwise,
the "Principal") when due, whether upon the Maturity Date (as defined below), on any Installment Date with respect
to the Installment Amount due on such Installment Date, acceleration, redemption or otherwise (in each case in accordance with
the terms hereof) and to pay interest ("Interest") on any outstanding Principal at the applicable Interest Rate
from the date set out above as the Issuance Date (the "Issuance Date") until the same becomes due and payable,
whether upon an Interest Date (as defined below), any Installment Date, the Maturity Date, acceleration, conversion, redemption
or otherwise (in each case in accordance with the terms hereof). This Senior Secured Convertible Note (including all Senior Secured
Convertible Notes issued in exchange, transfer or replacement hereof, this "Note") is one of an issue of Senior
Secured Convertible Notes issued pursuant to the Securities Purchase Agreement on the Closing Date (collectively, the "Notes"
and such other Senior Secured Convertible Notes, the "Other Notes"). Certain capitalized terms used herein
are defined in Section 32.

 

     

     

    

 

(1)         PAYMENTS
OF PRINCIPAL; PREPAYMENT. On each Installment Date, the Company shall pay to the Holder an amount equal to the Installment
Amount due on such Installment Date in accordance with Section 8. On the Maturity Date, the Company shall pay to the Holder an
amount in cash (excluding any amounts paid in shares of Common Stock on the Maturity Date in accordance with Section 8) representing
all outstanding Principal, accrued and unpaid Interest and accrued and unpaid Late Charges (as defined in Section 27(b)) on such
Principal and Interest. The "Maturity Date" shall be April 1, 2019, as may be extended at the option of
the Holder (i) in the event that, and for so long as, an Event of Default (as defined in Section 4(a)) shall have occurred and
be continuing on the Maturity Date (as may be extended pursuant to this Section 1) or any event shall have occurred and be continuing
on the Maturity Date (as may be extended pursuant to this Section 1) that with the passage of time and the failure to cure would
result in an Event of Default and (ii) through the date that is ten (10) Business Days after the consummation of a Change
of Control in the event that a Change of Control is publicly announced or a Change of Control Notice (as defined in Section 5(b))
is delivered prior to the Maturity Date. Other than as specifically permitted by this Note, the Company may not prepay any portion
of the outstanding Principal, accrued and unpaid Interest or accrued and unpaid Late Charges on Principal and Interest, if any.

 

(2)         INTEREST.

 

(a)          Interest
on this Note shall commence accruing on the Issuance Date at the Interest Rate and shall be computed on the basis of a 360-day
year and twelve 30-day months and shall be payable in arrears on each Installment Date (each, an "Interest Date").
Interest shall be payable on each Interest Date, to the record holder of this Note on the applicable Interest Date, in cash, in
shares of Common Stock or in a combination of cash and shares of Common Stock in accordance with Section 8. Prior
to the payment of Interest on an Interest Date, Interest on this Note shall accrue at the Interest Rate and be payable by way of
inclusion of the Interest in the Conversion Amount (as defined in Section 3(b)(i)) on each Conversion Date (as defined in Section
3(c)(i)) in accordance with Section 3(c)(i) and/or on each Redemption Date in accordance
with the provisions of this Note. From and after the occurrence and during the continuance of an Event of Default, the Interest
Rate shall be increased to eighteen percent (18.0%). In the event that such Event of Default is subsequently cured, the adjustment
referred to in the preceding sentence shall cease to be effective as of the date of such cure; provided, that the Interest
as calculated and unpaid at such increased rate during the continuance of such Event of Default shall continue to apply to the
extent relating to the days after the occurrence of such Event of Default through and including the date of cure of such Event
of Default; provided, further, that for the purpose of this Section 2, such Event of Default shall not be deemed
cured unless and until any accrued and unpaid Interest shall be paid to the Holder, including, without limitation, Interest accrued
at the increased rate of eighteen percent (18.0%). The Company shall pay any and all taxes (other than the Holder's income taxes)
that may be payable with respect to the issuance and delivery of shares of Common Stock as Interest pursuant to this Section 2.

 

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(b)          Notwithstanding
anything herein to the contrary, Interest payable on any Interest Date shall be reduced on a dollar for dollar basis for each dollar
received by the Holder since the immediately preceding Interest Date (or, with respect to the first Interest Date hereunder, since
the Issuance Date) as a Distribution in accordance with Section 6(a).

 

(3)         CONVERSION
OF NOTES. At any time or times after the Issuance Date, this Note shall be convertible into shares of the Common Stock, on
the terms and conditions set forth in this Section 3.

 

(a)          Conversion
Right. Subject to the provisions of Section 3(d), at any time or times on or after the Issuance Date, the Holder shall be entitled
to convert any portion of the outstanding and unpaid Conversion Amount into fully paid and nonassessable shares of Common Stock
in accordance with Section 3(c), at the Conversion Rate (as defined below). The Company shall not issue any fraction of a share
of Common Stock upon any conversion. If the issuance would result in the issuance of a fraction of a share of Common Stock, the
Company shall round such fraction of a share of Common Stock up to the nearest whole share. The Company shall pay any and all transfer,
stamp and similar taxes (excluding any income taxes of the Holder) that may be payable with respect to the issuance and delivery
of Common Stock upon conversion of any Conversion Amount.

 

(b)          Conversion
Rate. The number of shares of Common Stock issuable upon conversion of any Conversion Amount pursuant to Section 3(a) shall
be determined by dividing (x) such Conversion Amount by (y) the Conversion Price (the "Conversion Rate").

 

(i)          "Conversion
Amount" means the sum of (A) the portion of the Principal to be converted, amortized, redeemed or otherwise with respect
to which this determination is being made, (B) accrued and unpaid Interest with respect to such Principal and (C) accrued and unpaid
Late Charges, if any, with respect to such Principal and Interest.

 

(ii)         "Conversion
Price" means, as of any Conversion Date or other date of determination, a price per share equal to the lowest of (w)
$0.8033 (the price set forth in this clause (w), the "Fixed Conversion Price"), (x) 85% of the arithmetic average
of the five (5) lowest daily Weighted Average Prices of the Common Stock during the twenty (20) consecutive Trading Day period
ending on the Trading Day immediately preceding the delivery of the applicable Conversion Notice, (y) 85% of the Weighted Average
Price of the Common Stock on the Trading Day immediately preceding the delivery of the applicable Conversion Notice and (z) 85%
of the Weighted Average Price of the Common Stock on the Trading Day of the delivery of the applicable Conversion Notice, in each
case, subject to adjustment as provided herein. For the avoidance of doubt, all such foregoing determinations to be appropriately
adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction during the applicable
calculation period; provided, however, that the prices set forth in clauses (x), (y) and (z) shall not be less than
the Conversion Floor Price.

  

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(c)          Mechanics
of Conversion.

 

(i)          Optional
Conversion. To convert any Conversion Amount into shares of Common Stock on any date (a "Conversion Date"),
the Holder shall (A) transmit by facsimile or electronic mail (or otherwise deliver), for receipt on or prior to 6:00 p.m., New
York time, on such date, a copy of an executed notice of conversion in the form attached hereto as Exhibit I (the "Conversion
Notice") to the Company and (B) if required by Section 3(c)(iii), but without delaying the Company's requirement to deliver
shares of Common Stock on the applicable Share Delivery Date (as defined below), surrender this Note to a nationally recognized
overnight delivery service for delivery to the Company as soon as practicable on or following such date (or an indemnification
undertaking with respect to this Note in the case of its loss, theft or destruction). On or before the first (1st) Business Day
following the date of receipt of a Conversion Notice, the Company shall transmit by facsimile or electronic mail a confirmation
of receipt of such Conversion Notice to the Holder and the Company's transfer agent (the "Transfer Agent"). On
or before the third (3rd) Trading Day following the date of receipt of a Conversion Notice (the "Share Delivery Date"),
(A) the Company shall (x) provided that the Conversion Shares are then immediately sold or
transferred by the Holder either (1) pursuant to an effective registration statement, (2) pursuant to Rule 144 if the Holder indicates
on the applicable Conversion Notice that the shares of Common Stock issuable in connection with such Conversion Notice are being
sold contemporaneously by the Holder, or (3) pursuant to Rule 144 without having to comply with the information requirements under
Rule 144(c)(1), credit such aggregate number of shares of Common Stock to which the Holder shall be entitled to the Holder's
balance account with the Depository Trust Company ("DTC") through its Deposit Withdrawal At Custodian system or
(y) otherwise, issue and deliver to the address as specified in the Conversion Notice, a certificate, registered in the name of
the Holder, for the number of shares of Common Stock to which the Holder shall be entitled and (B) in the event a Conversion Floor
Price Condition occurs, the Company shall deliver to the Holder the applicable Conversion Cash Amount. If this Note is physically
surrendered for conversion as required by Section 3(c)(iii) and the outstanding Principal of this Note is greater than the Principal
portion of the Conversion Amount being converted, then the Company shall as soon as practicable and in no event later than three
(3) Business Days after receipt of this Note and at its own expense, issue and deliver to the Holder a new Note (in accordance
with Section 21(d)) representing the outstanding Principal not converted. The Person or Persons entitled to receive the shares
of Common Stock issuable upon a conversion of this Note shall be treated for all purposes as the record holder or holders of such
shares of Common Stock on the Conversion Date, irrespective of the date such Conversion Shares are credited to the Holder's account
with DTC or the date of delivery of the certificates evidencing such Conversion Shares, as the case may be. In the event that the
Holder elects to convert a portion of the Principal amount of this Note prior to any applicable Installment Date, the Conversion
Amount so converted shall be deducted in reverse order starting from the final Installment Amount to be paid hereunder on the final
Installment Date, unless the Holder otherwise indicates and allocates among any Installment Dates hereunder in the applicable Conversion
Notice.

 

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(ii)         Company's
Failure to Timely Convert. If the Company shall fail on or prior to the applicable Share Delivery Date to credit the Holder's
balance account with DTC (provided that the Holder has initiated an appropriate Deposit/Withdrawal at Custodian) or issue and deliver
a certificate to the Holder, as required pursuant to the terms of Section 3(c)(i), for the number of shares of Common Stock to
which the Holder is entitled upon the Holder's conversion of any Conversion Amount (a "Conversion Failure"), then
the Holder, upon written notice to the Company, may void its Conversion Notice with respect to, and retain or have returned, as
the case may be, any portion of this Note that has not been converted pursuant to such Conversion Notice; provided that
the voiding of a Conversion Notice shall not affect the Company's obligations to make any payments which have accrued prior to
the date of such notice pursuant to this Section 3(c)(ii) or otherwise. In addition to the foregoing, if the Company shall fail
on or prior to the Share Delivery Date to credit the Holder's balance account with DTC (provided that the Holder has initiated
an appropriate Deposit/Withdrawal at Custodian) or issue and deliver a certificate to the Holder, as required pursuant to the terms
of Section 3(c)(i), for the number of shares of Common Stock to which the Holder is entitled upon the Holder's conversion of any
Conversion Amount or on any date of the Company's obligation to deliver shares of Common Stock as contemplated pursuant to clause
(y) below, and if on or after such Trading Day the Holder purchases (in an open market transaction or otherwise) shares of Common
Stock to deliver in satisfaction of a sale by the Holder of Common Stock issuable upon such conversion that the Holder anticipated
receiving from the Company (a "Buy-In"), then the Company shall, within three (3) Trading Days after the Holder's
request and in the Holder's discretion, either (x) pay cash to the Holder in an amount equal to the Holder's total purchase price
(including brokerage commissions and other out-of-pocket expenses, if any) for the shares of Common Stock so purchased (the "Buy-In
Price"), at which point the Company's obligation to credit the Holder's balance account with DTC or issue and deliver
such certificate, as required pursuant to the terms of Section 3(c)(i), for the shares of Common Stock to which the Holder is entitled
upon the Holder's conversion of the applicable Conversion Amount shall terminate, or (y) promptly honor its obligation to credit
the Holder's balance account with DTC or deliver to the Holder a certificate or certificates, as required pursuant to the terms
of Section 3(c)(i), for such shares of Common Stock and pay cash to the Holder in an amount equal to the excess (if any) of the
Buy-In Price over the product of (A) such number of shares of Common Stock, times (B) the Closing Sale Price of the Common Stock
on the applicable Share Delivery Date. Nothing shall limit the Holder's right to pursue any other remedies available to it hereunder,
at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect to the
Company's failure to timely deliver certificates representing shares of Common Stock (or to electronically deliver such shares
of Common Stock) upon the conversion of this Note as required pursuant to the terms hereof.

 

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(iii)        Registration;
Book-Entry. The Company shall maintain a register (the "Register") for the recordation of the names and addresses
of the holders of each Note and the Principal amount of the Notes, Interest and Restricted Principal held by such holders (the
"Registered Notes"). The entries in the Register shall be conclusive and binding for all purposes absent manifest
error. The Company and the holders of the Notes shall treat each Person whose name is recorded in the Register as the owner of
a Note for all purposes, including, without limitation, the right to receive payments of Principal and Interest, if any, hereunder,
notwithstanding notice to the contrary. A Registered Note may be assigned or sold in whole or in part only by registration of such
assignment or sale on the Register. Upon its receipt of a request to assign or sell all or part of any Registered Note by a Holder,
the Company shall record the information contained therein in the Register and issue one or more new Registered Notes in the same
aggregate Principal amount as the Principal amount of the surrendered Registered Note to the designated assignee or transferee
pursuant to Section 20. Notwithstanding anything to the contrary in this Section 3(c)(iii), a Holder may assign any Note or any
portion thereof to an Affiliate of such Holder or a Related Fund of such Holder without delivering a request to assign or sell
such Note to the Company and the recordation of such assignment or sale in the Register (a "Related Party Assignment");
provided, that (w) the Company may continue to deal solely with such assigning or selling Holder unless and until such Holder
has delivered a request to assign or sell such Note or portion thereof to the Company for recordation in the Register; (x) the
failure of such assigning or selling Holder to deliver a request to assign or sell such Note or portion thereof to the Company
shall not affect the legality, validity, or binding effect of such assignment or sale, (y) such assigning or selling Holder shall,
acting solely for this purpose as a non-fiduciary agent of the Company, maintain a register (the "Related Party Register")
comparable to the Register on behalf of the Company, and any such assignment or sale shall be effective upon recordation of such
assignment or sale in the Related Party Register and (z) such assignment is completed in compliance with the 1933 Act. Notwithstanding
anything to the contrary set forth herein, upon conversion of any portion of this Note in accordance with the terms hereof, the
Holder shall not be required to physically surrender this Note to the Company unless (A) the full Conversion Amount represented
by this Note is being converted or (B) the Holder has provided the Company with prior written notice (which notice may be included
in a Conversion Notice) requesting reissuance of this Note upon physical surrender of this Note. The Holder and the Company shall
maintain records showing any Control Account Release (as defined in Section (17)(b)(ii)), the Principal, Interest and Late Charges,
and any, conversions thereof, and the dates of such conversions or shall use such other method, reasonably satisfactory to the
Holder and the Company, so as not to require physical surrender of this Note upon conversion. If the Company does not update the
Register to record such Principal, Interest and Late Charges converted and/or paid (as the case may be) or Control Account Release
and the dates of such conversions, payments and/or Control Account Release (as the case may be) within two (2) Business Days of
such occurrence, then the Register shall be automatically deemed updated to reflect such occurrence.

 

(iv)        Pro
Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from the Holder and one or more holders
of Other Notes for the same Conversion Date and the Company can convert some, but not all, of such portions of this Note and such
Other Notes submitted for conversion, the Company, subject to Section 3(d), shall convert from the Holder and each holder of Other
Notes electing to have this Note or the Other Notes converted on such date a pro rata amount of each such holder's portion of this
Note and such Other Notes submitted for conversion based on the Principal amount of this Note and the Other Notes submitted for
conversion on such date by such holder relative to the aggregate Principal amount of this Note and all Other Notes submitted for
conversion on such date. In the event of a dispute as to the number of shares of Common Stock issuable to the Holder in connection
with a conversion of this Note, the Company shall issue to the Holder the number of shares of Common Stock not in dispute and resolve
such dispute in accordance with Section 26.

 

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(v)         Mandatory
Conversion at the Company's Election. If at any time from and after the Issuance Date, no Equity Conditions Failure has occurred
during the Equity Conditions Measuring Period relating to the applicable Mandatory Conversion (as defined below), the Company shall
have the right to require the Holder and all, but not less than all, holders of Other Notes to convert all, or any portion equal
to at least $1,000,000 in the aggregate for all Notes, or such lesser amount that is then outstanding under this Note and the Other
Notes, as designated in the applicable Mandatory Conversion Notice on the applicable Mandatory Conversion Date (each as defined
below) into fully paid, validly issued and nonassessable shares of Common Stock in accordance with Section 3(c) hereof at
the Conversion Rate as of the Mandatory Conversion Date (a "Mandatory Conversion"). The Company may exercise its
right to require conversion under this Section 3(c)(v) by delivering within not more than five (5) Trading Days following the end
of the relevant Equity Conditions Measuring Period a written notice thereof by facsimile or electronic mail and overnight courier
to the Holder and all, but not less than all, of the holders of Notes and the Transfer Agent (a "Mandatory Conversion Notice"
and the date the Holder and all the holders of the Other Notes receive such notice is referred to as a "Mandatory Conversion
Notice Date"). Each Mandatory Conversion Notice shall be irrevocable. Each Mandatory Conversion Notice shall (i) state
(a) the Trading Day on which the Mandatory Conversion shall occur, which Trading Day shall not be less than ten (10) Trading Days
nor more than twelve (12) Trading Days following the Mandatory Conversion Notice Date (the "Mandatory Conversion Date"),
(b) the aggregate Conversion Amount of the Notes which the Company has elected to be subject to Mandatory Conversion from the Holder
and all of the holders of the Other Notes pursuant to this Section 3(c)(v) (and analogous provisions under the Other Notes) and
(c) the number of shares of Common Stock to be issued to the Holder on the Mandatory Conversion Date and (ii) certify that
there has been no Equity Conditions Failure on any day during the period beginning on the first day of the Equity Conditions Measuring
Period prior to the applicable Mandatory Conversion Notice Date through the applicable Mandatory Conversion Notice Date. If the
Company confirmed that there was no such Equity Conditions Failure as of the applicable Mandatory Conversion Notice Date but an
Equity Conditions Failure occurs between such Mandatory Conversion Notice Date and any time through the applicable Mandatory Conversion
Date (the "Mandatory Conversion Interim Period"), the Company shall provide the Holder and each holder
of Other Notes a subsequent notice to that effect. If there is an Equity Conditions Failure (which is not waived in writing by
the Holder) during such Mandatory Conversion Interim Period, then such Mandatory Conversion shall be null and void with respect
to all or any part designated by the Holder of the unconverted Conversion Amount subject to such Mandatory Conversion and the Holder
shall be entitled to all the rights of a holder of this Note with respect to such Conversion Amount. The Company may effect only
one (1) Mandatory Conversion under the Notes during any six (6) month period; provided, however, that if Section
3(d) prevents the Company from effecting in full the Mandatory Conversion of the full aggregate Conversion Amount of this Note
which the Company has elected to be subject to Mandatory Conversion from the Holder as set forth in the applicable Mandatory Conversion
Notice (the "Aggregate Mandatory Conversion Amount" and the amount not so converted, the "Mandatory Conversion
Shortfall Amount"), the Company may from time to time effect one or more additional Mandatory Conversions (each, a "Supplemental
Mandatory Conversion") in accordance with the terms of this Section 3(c)(v), including, without limitation, the absence
of any Equity Conditions Failure during the Equity Conditions Measuring Period relating to the applicable Supplemental Mandatory
Conversion, in order to effect the Mandatory Conversion of the Mandatory Conversion Shortfall Amount so long as the aggregate Conversion
Amount of this Note subject to a Mandatory Conversion (including any related Supplemental Mandatory Conversions) in any six (6)
month period shall not exceed the Aggregate Mandatory Conversion Amount as set forth in the applicable Mandatory Conversion Notice
for such period.  Notwithstanding anything to the contrary in this Section 3(c)(v), until a Mandatory Conversion has occurred,
the Conversion Amount subject to such Mandatory Conversion may be converted, in whole or in part, by the Holder into shares of
Common Stock pursuant to Sections 3(c)(i) and/or 7(c). All Conversion Amounts converted by the Holder after a Mandatory Conversion
Notice Date shall reduce the Conversion Amount of this Note required to be converted on the applicable Mandatory Conversion Date,
unless the Holder otherwise indicates in the applicable Conversion Notice. If the Company
elects to cause a Mandatory Conversion pursuant to this Section 3(c)(v), then it must
simultaneously take the same action in the same proportion with respect to the Other Notes. If the Company elects to cause a Mandatory
Conversion pursuant to this Section 3(c)(v) (or similar provisions under the Other Notes)
with respect to less than all of the Conversion Amounts of the Notes then outstanding, then the Company shall effect a Mandatory
Conversion of a Conversion Amount from each of the holders of the Notes equal to the product
of (i) the aggregate Conversion Amount of Notes which the Company has elected to be subject to a Mandatory Conversion pursuant
to this Section 3(c)(v), multiplied by (ii) the fraction, the numerator of which is the sum of the aggregate Original Principal
Amount of the Notes purchased by such holder of outstanding Notes and the denominator of which is the sum of the aggregate Original
Principal Amount of the Notes purchased by all holders holding outstanding Notes (such fraction with respect to each holder is
referred to as its "Mandatory Conversion Allocation Percentage",
and such amount with respect to each holder is referred to as its "Pro Rata Mandatory Conversion Amount");
provided, however, that in the event that any holder's Pro Rata Mandatory Conversion Amount
exceeds the outstanding Principal amount of such holder's Note, then such excess Pro Rata Mandatory Conversion Amount
shall be allocated amongst the remaining holders of Notes in accordance with the foregoing formula. In the event that the initial
holder of any Notes shall sell or otherwise transfer any of such holder's Notes, the transferee shall be allocated a pro rata portion
of such holder's Mandatory Conversion Allocation Percentage and Pro Rata Mandatory
Conversion Amount.

 

    - 7 -

     

    

 

(d)          Limitations
on Conversions.

 

(i)          Beneficial
Ownership. Notwithstanding anything herein to the contrary, the Company shall not effect the conversion of any portion of this
Note, and the Holder shall not have the right to convert any portion of this Note, pursuant to the terms and conditions of this
Note and any such conversion shall be null and void and treated as if never made, to the extent that after giving effect to such
conversion, the Holder together with the other Attribution Parties collectively would beneficially own in excess of 9.99% (the
"Maximum Percentage") of the number of the shares of Common Stock outstanding immediately after giving effect
to such conversion. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by
the Holder and the other Attribution Parties shall include the shares of Common Stock held by the Holder and all other Attribution
Parties plus the number of shares of Common Stock issuable upon conversion of this Note with respect to which the determination
of such sentence is being made, but shall exclude the shares of Common Stock which would be issuable upon (i) conversion of the
remaining, nonconverted portion of this Note beneficially owned by the Holder or any of the other Attribution Parties and (ii)
exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation,
any convertible notes or convertible preferred stock or warrants, including the Warrants) beneficially owned by the Holder or any
other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained in this Section
3(d)(i). For purposes of this Section 3(d)(i), beneficial ownership shall be calculated in accordance with Section 13(d) of the
1934 Act. For purposes of determining the number of outstanding shares of Common Stock the Holder may acquire upon the conversion
of the Note without exceeding the Maximum Percentage, the Holder may rely on the number of outstanding shares of Common Stock as
reflected in (i) the Company's most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K
or other public filing with the SEC, as the case may be, (ii) a more recent public announcement by the Company or (iii) any other
written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding (the "Reported
Outstanding Share Number"). If the Company receives a Conversion Notice from the Holder at a time when the actual number
of outstanding shares of Common Stock is less than the Reported Outstanding Share Number, the Company shall notify the Holder in
writing of the number of shares of Common Stock then outstanding and, to the extent that such Conversion Notice would otherwise
cause the Holder's beneficial ownership, as determined pursuant to this Section 3(d)(i), to exceed the Maximum Percentage, the
Holder must notify the Company of a reduced number of shares of Common Stock to be purchased pursuant to such Conversion Notice.
For any reason at any time, upon the written or oral request of the Holder, the Company shall within one (1) Business Day confirm
orally and in writing or by electronic mail to the Holder the number of shares of Common Stock then outstanding. In any case, the
number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities
of the Company, including this Note, by the Holder and any other Attribution Party since the date as of which the Reported Outstanding
Share Number was reported. In the event that the issuance of shares of Common Stock to the Holder upon conversion of this Note
results in the Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum
Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the number
of shares so issued by which the Holder's and the other Attribution Parties' aggregate beneficial ownership exceeds the Maximum
Percentage (the "Excess Shares") shall be deemed null and void and shall be cancelled ab initio, and the Holder
shall not have the power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Company, the Holder
may from time to time increase or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in
such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st)
day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the
other Attribution Parties and not to any other holder of Notes that is not an Attribution Party of the Holder. For purposes of
clarity, the shares of Common Stock issuable pursuant to the terms of this Note in excess of the Maximum Percentage shall not be
deemed to be beneficially owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the
1934 Act. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with
the terms of this Section 3(d)(i) to the extent necessary to correct this paragraph (or any portion of this paragraph) which may
be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 3(d)(i) or to make changes
or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this paragraph may
not be waived and shall apply to a successor holder of this Note.

 

    - 8 -

     

    

 

(ii)         Principal
Market Regulation. The Company shall not be obligated to issue any shares of Common Stock pursuant to the terms of this Note,
and the Holder shall not have the right to receive pursuant to the terms of this Note any shares of Common Stock, if the issuance
of such shares of Common Stock would exceed that aggregate number of shares of Common Stock which the Company may issue pursuant
to the terms of the Notes without breaching the Company's obligations under the rules or regulations of the Principal Market (the
"Exchange Cap"), except that such limitation shall not apply in the event that the Company (i) obtains the approval
of its shareholders as required by the applicable rules of the Principal Market for issuances of shares of Common Stock in excess
of such amount or (ii) obtains a written opinion from outside counsel to the Company that such approval is not required, which
opinion shall be reasonably satisfactory to the Required Holders. Until such approval or written opinion is obtained, no purchaser
of the Notes pursuant to the Securities Purchase Agreement (the "Purchasers") shall be issued in the aggregate,
pursuant to the terms of the Notes, shares of Common Stock in an amount greater than the product of the Exchange Cap multiplied
by a fraction, the numerator of which is the Principal amount of Notes issued to such Purchaser pursuant to the Securities Purchase
Agreement on the Closing Date and the denominator of which is the aggregate principal amount of all Notes issued to the Purchasers
pursuant to the Securities Purchase Agreement on the Closing Date (with respect to each Purchaser, the "Exchange Cap Allocation").
In the event that the Holder shall sell or otherwise transfer any of the Holder's Notes, the transferee shall be allocated a pro
rata portion of the Holder's Exchange Cap Allocation, and the restrictions of the prior sentence shall apply to such transferee
with respect to the portion of the Exchange Cap Allocation allocated to such transferee. In the event that any holder of Notes
shall convert all of such holder's Notes into a number of shares of Common Stock which, in the aggregate, is less than such holder's
Exchange Cap Allocation, then the difference between such holder's Exchange Cap Allocation and the number of shares of Common Stock
actually issued to such holder shall be allocated to the respective Exchange Cap Allocations of the remaining holders of Notes
on a pro rata basis in proportion to the aggregate principal amount of the Notes then held by each such holder. In the event that
the Company is prohibited from issuing any Conversion Shares for which a Conversion Notice has been received as a result of the
operation of this Section 3(d)(ii) at any time from and after the earlier of (x) the Shareholder Meeting Deadline and (y) the date
on which the Company holds the Shareholder Meeting (as defined in the Securities Purchase Agreement), then unless the Holder elects
to void such conversion, the Holder may require the Company to pay to the Holder within three (3) Trading Days of the applicable
attempted conversion, cash by wire transfer of immediately available funds, in exchange for cancellation of the applicable portion
of the Conversion Amount that is subject to such Conversion Notice, which cash amount for each share of Common Stock that would
have been issuable upon such conversion if this Section 3(d)(ii) were not in effect shall be equal to the Weighted Average Price
of the Common Stock on the applicable Conversion Date.

 

    - 9 -

     

    

 

(4)         RIGHTS
UPON EVENT OF DEFAULT.

 

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

 

(i)          (A)
the suspension from trading or quotation on an Eligible Market for a period of two (2) consecutive Trading Days or for more than
an aggregate of ten (10) Trading Days in any 365-day period or (B) or failure of the Common Stock to be listed or quoted on an
Eligible Market;

 

(ii)         the
Company's (A) failure to cure a Conversion Failure or an Exercise Failure (as defined in the Warrants), other than solely as a
result of the Holder's actions or omissions, by delivery of the required number of shares of Common Stock within five (5) Business
Days after the applicable Conversion Date or the date a holder of Warrants delivers an Exercise Notice (as defined in the Warrants)
and the applicable Aggregate Exercise Price (as defined in the Warrants), if any, to the Company or (B) notice, written or oral,
to the Holder or any holder of the Other Notes or the Warrants, including by way of public announcement or through any of its agents,
at any time, of its intention not to comply with a request for conversion of this Note or any Other Notes into, or exercise of
the Warrants for, shares of Common Stock that is tendered in accordance with the provisions of this Note, the Other Notes or the
Warrants, as applicable, other than pursuant to Section 3(d) (and analogous provisions under the Other Notes and the Warrants);

 

    - 10 -

     

    

 

(iii)        at
any time following the fifth (5th) consecutive Business Day that the Holder's Authorized Share Allocation (as defined
in Section 11(a)) is less than 200% of the sum of (A) the number of shares of Common Stock that the Holder would be entitled to
receive upon a conversion of the full Conversion Amount of this Note determined based on the Equity Conditions Conversion Price
(without regard to any limitations on conversion set forth in Section 3(d) or otherwise) and (B) the number of shares of Common
Stock that the Holder would be entitled to receive upon exercise in full of the Holder's Warrants (without regard to any limitations
on exercise set forth in the Warrants);

 

(iv)        the
Company's failure to pay to the Holder any amount of Principal, Interest, Late Charges, Redemption Price or other amounts when
and as due under this Note or any other Transaction Document or any other agreement, document, certificate or other instrument
delivered in connection with the transactions contemplated hereby and thereby to which the Holder is a party whether in Common
Stock or cash, except, in the case of a failure to pay Interest and/or Late Charges when and as due, in which case only if such
failure continues for a period of at least an aggregate of three (3) Business Days;

 

(v)         any
default, which is not cured or waived during any applicable cure period, under, redemption of or acceleration prior to maturity
of any Indebtedness of the Company or any of its Subsidiaries other than with respect to this Note or any Other Notes;

 

(vi)        without
limiting the generality of the Event of Default set forth in clause (vi) above, any "Event of Default" as such term is
defined in the Permitted Senior Loan Agreement, which results in the Permitted Senior Lender's acceleration prior to maturity of
such Permitted Senior Indebtedness;

 

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

 

(viii)      a
court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (A) is for relief against the Company or
any of its Subsidiaries in an involuntary case, (B) appoints a Custodian of the Company or any of its Subsidiaries or (C) orders
the liquidation of the Company or any of its Subsidiaries;

 

(ix)         a
final judgment or judgments for the payment of money aggregating in excess of $250,000 are rendered against the Company or any
of its Subsidiaries and which judgments are not, within sixty (60) days after the entry thereof, bonded, discharged or stayed pending
appeal, or are not discharged within sixty (60) days after the expiration of such stay; provided, however, that any
judgment which is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $250,000
amount set forth above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which
written statement shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an
indemnity and the Company will receive the proceeds of such insurance or indemnity within thirty (30) days of the issuance of such
judgment;

 

    - 11 -

     

    

 

(x)          other
than as specifically set forth in another clause of this Section 4(a), the Company or any of its Subsidiaries breaches, in any
respect that is adverse in any material or immaterial respect to the Holder, any representation, warranty, covenant or other term
or condition of any Transaction Document, except, in the case of a breach of a covenant or other term or condition of any Transaction
Document which is curable, only if such breach continues for a period of at least an aggregate of seven (7) Business Days;

 

(xi)         any
breach or failure in any respect to comply with Section 15 of this Note;

 

(xii)        the
Company shall fail to perform or comply with any covenant or agreement contained in any Master Control Account Agreement (as defined
in Section 17(b)(i)) and such failure shall continue beyond any cure periods expressly set forth therein;

 

(xiii)       any
material provision of any Master Control Account Agreement shall at any time for any reason (other than pursuant to the express
terms thereof) cease to be valid and binding on or enforceable against the Company, or the validity or enforceability thereof shall
be contested by any party thereto (other than the Holder), or a proceeding shall be commenced by the Company or any Subsidiary
or any governmental authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability thereof,
or the Company or any Subsidiary shall deny in writing that it has any liability or obligation purported to be created under any
Master Control Account Agreement;

 

(xiv)      any
Master Control Account Agreement or any other security document, after delivery thereof pursuant hereto, shall for any reason fail
or cease to create a valid and perfected and, except to the extent permitted by the terms hereof or thereof, first priority Lien
(as defined in Section 17(b)) in favor of the Holder or holder of Other Notes on such holder's Master Control Account Collateral
(as defined in Section 17(b)(iii)), as applicable purported to be covered thereby;

 

(xv)       any
bank at which any deposit account, blocked account, lockbox account or other account of the Company or any Subsidiary which is
subject to the terms of the Master Control Account Agreement shall fail to comply with any material term of the Master Control
Account Agreement;

 

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

 

    - 12 -

     

    

 

(xvii)     a
false or inaccurate certification (including a false or inaccurate deemed certification) by the Company that the Equity Conditions
are satisfied or that there has been no Equity Conditions Failure or as to whether any Event of Default has occurred;

 

(xviii)    the
Company's failure for any reason after the date that is six (6) months immediately following the Issuance Date to satisfy the current
public information requirement under Rule 144(c) of the 1933 Act; provided, however, that if (A) the Company filed a Form 12b-25
within the applicable deadline imposed by Rule 12b-25 under the 1934 Act (or any successor thereto) with respect to any Quarterly
Report on Form 10-Q or any Annual Report on Form 10-K and (B) the Company subsequently files such Quarterly Report on Form 10-Q
or Annual Report on Form 10-K, as applicable, with the SEC within the applicable period provided in Rule 12b-25 under the 1934
Act, then such late filing of such report shall not be considered an Event of Default hereunder;

 

(xix)       if
as of the applicable date of determination the shares of Common Stock issuable pursuant to the terms of the Notes and/or exercise
of the Warrants are eligible to be resold by the Holder either (a) pursuant to an effective registration statement in favor of
the Holder, (b) pursuant to Rule 144 without having to comply with Rule 144(c)(1), or (c) pursuant to Rule 144 and the Holder has
indicated on a Conversion Notice that it is selling the Conversion Shares pursuant to Rule 144 while the Company is in compliance
with the requirements of Rule 144(c)(1) contemporaneously with such conversion, the failure of such shares of Common Stock issuable
pursuant to the terms of the Notes and/or such Warrant, as applicable, to be issued and delivered to the Holder without any restrictive
legends; 

 

(xx)        any
Material Adverse Effect occurs; or

 

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

  

(b)          Redemption
Right. Upon the occurrence of an Event of Default with respect to this Note or any Other Note, the Company shall within two
(2) Business Days deliver written notice thereof via facsimile or electronic mail and overnight courier (an "Event of Default
Notice") to the Holder. At any time after the earlier of the Holder's receipt of an Event of Default Notice and the Holder
becoming aware of an Event of Default, the Holder may require the Company to redeem (an "Event of Default Redemption")
all or any portion of this Note by delivering written notice thereof (the "Event of Default Redemption Notice")
to the Company, which Event of Default Redemption Notice shall indicate the portion of this Note the Holder is electing to require
the Company to redeem. Each portion of this Note subject to redemption by the Company pursuant to this Section 4(b) shall be redeemed
by the Company in cash by wire transfer of immediately available funds at a price equal to the greater of (x) 125% of the Conversion
Amount being redeemed and (y) the product of (A) the Conversion Amount being redeemed and (B) the quotient determined by dividing
(I) the greatest Closing Sale Price of the shares of Common Stock during the period beginning on the date immediately preceding
such Event of Default and ending on the date the Company makes the entire payment required to be made under this Section 4(b),
by (II) the lowest Conversion Price in effect during such period (the "Event of Default Redemption Price").
Redemptions required by this Section 4(b) shall be made in accordance with the provisions of Section 12. To the extent redemptions
required by this Section 4(b) are deemed or determined by a court of competent jurisdiction to be prepayments of the Note by the
Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section
4, but subject to Section 3(d), until the Event of Default Redemption Price (together with any interest thereon) is paid in full,
the Conversion Amount submitted for redemption under this Section 4(b) (together with any interest thereon) may be converted, in
whole or in part, by the Holder into Common Stock pursuant to Section 3. In the event of a partial redemption of this Note pursuant
hereto, the Principal amount redeemed shall be deducted in reverse order starting from the final Installment Amount to be paid
hereunder on the final Installment Date, unless the Holder otherwise indicates and allocates among any Installment Dates hereunder
in the applicable Event of Default Redemption Notice. The parties hereto agree that in the event of the Company's redemption of
any portion of the Note under this Section 4(b), the Holder's damages would be uncertain and difficult to estimate because of the
parties' inability to predict future interest rates and the uncertainty of the availability of a suitable substitute investment
opportunity for the Holder. Accordingly, any Event of Default redemption premium due under this Section 4(b) is intended by the
parties to be, and shall be deemed, a reasonable estimate of the Holder's actual loss of its investment opportunity and not as
a penalty.

 

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(5)         RIGHTS
UPON FUNDAMENTAL TRANSACTION AND CHANGE OF CONTROL.

 

(a)          Assumption.
The Company shall not enter into or be party to a Fundamental Transaction unless the Successor Entity assumes in writing all of
the obligations of the Company under this Note and the other Transaction Documents in accordance with the provisions of this Section
5(a) pursuant to written agreements in form and substance reasonably satisfactory to the Required Holders and approved by the Required
Holders, such approval not to be unreasonably withheld, conditioned or delayed, prior to such Fundamental Transaction, including
agreements, if so requested by the Holder, to deliver to each holder of Notes in exchange for such Notes a security of the Successor
Entity evidenced by a written instrument substantially similar in form and substance to the Notes, including, without limitation,
having a principal amount and interest rate equal to the Principal amount and the Interest Rate of the Notes then outstanding held
by such holder, having similar conversion rights and having similar ranking and security to the Notes, and reasonably satisfactory
to the Required Holders. Upon the occurrence or consummation of any Fundamental Transaction, and it shall be a required condition
to the occurrence or consummation of any Fundamental Transaction that, the Company and the Successor Entity or Successor Entities,
jointly and severally, shall succeed to, and the Company shall cause any Successor Entity or Successor Entities to jointly and
severally succeed to, and be added to the term "Company" under this Note (so that from and after the date of such Fundamental
Transaction, each and every provision of this Note referring to the "Company" shall refer instead to each of the Company
and the Successor Entity or Successor Entities, jointly and severally), and the Company and the Successor Entity or Successor Entities,
jointly and severally, may exercise every right and power of the Company prior thereto and shall assume all of the obligations
of the Company prior thereto under this Note with the same effect as if the Company and such Successor Entity or Successor Entities,
jointly and severally, had been named as the Company in this Note, and, solely at the request of the Holder, if the Successor Entity
and/or Successor Entities is a publicly traded corporation whose common capital stock is quoted on or listed for trading on an
Eligible Market, shall deliver (in addition to and without limiting any right under this Note) to the Holder in exchange for this
Note a security of the Successor Entity and/or Successor Entities evidenced by a written instrument substantially similar in form
and substance to this Note and convertible for a corresponding number of shares of capital stock of the Successor Entity and/or
Successor Entities (the "Successor Capital Stock") equivalent (as set forth below) to the shares of Common Stock
acquirable and receivable upon conversion of this Note (without regard to any limitations on the conversion of this Note) prior
to such Fundamental Transaction (such corresponding number of shares of Successor Capital Stock to be delivered to the Holder shall
be equal to the greater of (I) the quotient of (A) the aggregate dollar value of all consideration (including cash consideration
and any consideration other than cash ("Non-Cash Consideration"), in such Fundamental Transaction, as such values
are set forth in any definitive agreement for the Fundamental Transaction that has been executed at the time of the first public
announcement of the Fundamental Transaction or, if no such value is determinable from such definitive agreement, as determined
in accordance with Section 26 with the term "Non-Cash Consideration" being substituted for the term "Conversion
Price") that the Holder would have been entitled to receive upon the happening of such Fundamental Transaction or the record,
eligibility or other determination date for the event resulting in such Fundamental Transaction, had this Note been converted immediately
prior to such Fundamental Transaction or the record, eligibility or other determination date for the event resulting in such Fundamental
Transaction (without regard to any limitations on the conversion of this Note) (the "Aggregate Consideration")
divided by (B) the per share Closing Sale Price of such corresponding Successor Capital Stock on the Trading Day immediately prior
to the consummation or occurrence of the Fundamental Transaction and (II) the product of (A) the Aggregate Consideration and (B)
the highest exchange ratio pursuant to which any shareholder of the Company may exchange Common Stock for Successor Capital Stock)
(provided, however, to the extent that the Holder's right to receive any such shares of publicly traded common stock
(or their equivalent) of the Successor Entity would result in the Holder and its other Attribution Parties exceeding the Maximum
Percentage, if applicable, then the Holder shall not be entitled to receive such shares to such extent (and shall not be entitled
to beneficial ownership of such shares of publicly traded common stock (or their equivalent) of the Successor Entity as a result
of such consideration to such extent) and the portion of such shares shall be held in abeyance for the Holder until such time or
times, as its right thereto would not result in the Holder and its other Attribution Parties exceeding the Maximum Percentage,
at which time or times the Holder shall be delivered such shares to the extent as if there had been no such limitation), and such
security shall be reasonably satisfactory to the Holder, and with an identical conversion price to the Conversion Price hereunder
(such adjustments to the number of shares of capital stock and such conversion price being for the purpose of protecting after
the consummation or occurrence of such Fundamental Transaction the economic value of this Note that was in effect immediately prior
to the consummation or occurrence of such Fundamental Transaction, as elected by the Holder solely at its option). Upon occurrence
or consummation of the Fundamental Transaction, and it shall be a required condition to the occurrence or consummation of such
Fundamental Transaction that, the Company and the Successor Entity or Successor Entities shall deliver to the Holder confirmation
that there shall be issued upon conversion of this Note at any time after the occurrence or consummation of the Fundamental Transaction,
as elected by the Holder solely at its option, shares of Common Stock, Successor Capital Stock or, in lieu of the shares of Common
Stock or Successor Capital Stock (or other securities, cash, assets or other property purchasable upon the conversion of this Note
prior to such Fundamental Transaction), such shares of stock, securities, cash, assets or any other property whatsoever (including
warrants or other purchase or subscription rights), which for purposes of clarification may continue to be shares of Common Stock,
if any, that the Holder would have been entitled to receive upon the happening of such Fundamental Transaction or the record, eligibility
or other determination date for the event resulting in such Fundamental Transaction, had this Note been converted immediately prior
to such Fundamental Transaction or the record, eligibility or other determination date for the event resulting in such Fundamental
Transaction (without regard to any limitations on the conversion of this Note), as adjusted in accordance with the provisions of
this Note. The provisions of this Section 5(a) shall apply similarly and equally to successive Fundamental Transactions. Notwithstanding
the foregoing, the Holder may elect, in its sole discretion, by delivery of written notice to the Company, to waive this Section
5(a) and allow the Company to enter into or be a party to a Fundamental Transaction without the assumption of this Note pursuant
to the provisions of this Section 5(a), provided, however, that any such waiver shall only be on the terms of such
waiver and bind the Holder with respect to this Note and not any holder of Other Notes.

 

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(b)          Redemption
Right. No sooner than twenty-five (25) days nor later than twenty (20) days prior to the consummation of a Change of Control,
but not prior to the public announcement of such Change of Control, the Company shall deliver written notice thereof via facsimile
or electronic mail and overnight courier to the Holder (a "Change of Control Notice"). At any time during
the period beginning on the earlier to occur of (x) any oral or written agreement by the Company or any of its Subsidiaries, upon
consummation of which the transaction contemplated thereby would reasonably be expected to result in a Change of Control, (y) the
Holder becoming aware of a Change of Control and (z) the Holder's receipt of a Change of Control Notice and ending twenty-five
(25) Trading Days after the date of the consummation of such Change of Control, the Holder may require the Company to redeem (a
"Change of Control Redemption") all or any portion of this Note by delivering written notice thereof ("Change
of Control Redemption Notice") to the Company, which Change of Control Redemption Notice shall indicate the Conversion
Amount the Holder is electing to require the Company to redeem. The portion of this Note subject to redemption pursuant to this
Section 5(b) shall be redeemed by the Company in cash by wire transfer of immediately available funds at a price equal to the greater
of (x) 125% of the Conversion Amount being redeemed and (y) the product of (A) the Conversion Amount being redeemed and (B) the
quotient determined by dividing (I) the greatest Closing Sale Price of the shares of Common Stock during the period beginning on
the date immediately preceding the earlier to occur of (x) the consummation of the Change of Control and (y) the public announcement
of such Change of Control and ending on the date the Holder delivers the Change of Control Redemption Notice, by (II) the lowest
Conversion Price in effect during such period (the "Change of Control Redemption Price"). Redemptions required
by this Section 5(b) shall be made in accordance with the provisions of Section 12 and shall have priority to payments to shareholders
in connection with a Change of Control. To the extent redemptions required by this Section 5(b) are deemed or determined by a court
of competent jurisdiction to be prepayments of the Note by the Company, such redemptions shall be deemed to be voluntary prepayments.
Notwithstanding anything to the contrary in this Section 5, but subject to Section 3(d), until the Change of Control Redemption
Price (together with any interest thereon) is paid in full, the Conversion Amount submitted for redemption under this Section 5(b)
(together with any interest thereon) may be converted, in whole or in part, by the Holder into Common Stock pursuant to Section
3. In the event of a partial redemption of this Note pursuant hereto, the Principal amount redeemed shall be deducted in reverse
order starting from the final Installment Amount to be paid hereunder on the final Installment Date, unless the Holder otherwise
indicates and allocates among any Installment Dates hereunder in the applicable Change of Control Redemption Notice. The parties
hereto agree that in the event of the Company's redemption of any portion of the Note under this Section 5(b), the Holder's damages
would be uncertain and difficult to estimate because of the parties' inability to predict future interest rates and the uncertainty
of the availability of a suitable substitute investment opportunity for the Holder. Accordingly, any Change of Control redemption
premium due under this Section 5(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder's
actual loss of its investment opportunity and not as a penalty.

 

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(6)         DISTRIBUTION
OF ASSETS; RIGHTS UPON ISSUANCE OF PURCHASE RIGHTS AND OTHER CORPORATE EVENTS.

 

(a)          Distribution
of Assets. If the Company shall declare or make any dividend or other distributions of its assets (or rights to acquire its
assets) to any or all holders of shares of Common Stock, by way of return of capital or otherwise (including without limitation,
any distribution of cash, stock or other securities, property, options, evidence of indebtedness or any other assets by way of
a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (the "Distributions"),
at any time after the issuance of this Note, then, in each such case, the Holder shall be entitled to such Distributions as if
the Holder had held the number of shares of Common Stock acquirable upon complete conversion of this Note (without taking into
account any limitations or restrictions on the convertibility of this Note) immediately prior to the date on which a record is
taken for such Distribution or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined
for such Distributions (provided, however, that to the extent that the Holder's right to participate in any such
Distribution would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall
not be entitled to participate in such Distribution to such extent (and shall not be entitled to beneficial ownership of such shares
of Common Stock as a result of such Distribution (and beneficial ownership) to such extent) and the portion of such Distribution
shall be held in abeyance for the benefit of the Holder until such time or times as its right thereto would not result in the Holder
and the other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such Distribution
(and any Distributions declared or made on such initial Distribution or on any subsequent Distribution to be held similarly in
abeyance) to the same extent as if there had been no such limitation).

 

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(b)          Purchase
Rights. If at any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase stock,
warrants, securities or other property pro rata to the record holders of any class of Common Stock (the "Purchase Rights"),
then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which
the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete conversion
of this Note (without taking into account any limitations or restrictions on the convertibility of this Note) immediately prior
to the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken,
the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase
Rights (provided, however, that to the extent that the Holder's right to participate in any such Purchase Right would
result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled
to participate in such Purchase Right to such extent (and shall not be entitled to beneficial ownership of such shares of Common
Stock as a result of such Purchase Right (and beneficial ownership) to such extent) and such Purchase Right to such extent shall
be held in abeyance for the benefit of the Holder until such time or times as its right thereto would not result in the Holder
and the other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder shall be granted such right
(and any Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent Purchase Right to be held similarly
in abeyance) to the same extent as if there had been no such limitation).

 

(c)          Other
Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the occurrence or consummation
of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities, cash, assets
or other property with respect to or in exchange for shares of Common Stock (a "Corporate Event"), the Company
shall make appropriate provision to ensure that, and any applicable Successor Entity or Successor Entities shall ensure that, and
it shall be a required condition to the occurrence or consummation of such Corporate Event that, the Holder will thereafter have
the right to receive upon conversion of this Note at any time after the occurrence or consummation of the Corporate Event, shares
of Common Stock or Successor Capital Stock or, if so elected by the Holder, in lieu of the shares of Common Stock (or other securities,
cash, assets or other property) purchasable upon the conversion of this Note prior to such Corporate Event (but not in lieu of
such items still issuable under Sections 6(a) and 6(b), which shall continue to be receivable on the Common Stock or on such shares
of stock, securities, cash, assets or any other property otherwise receivable with respect to or in exchange for shares of Common
Stock), such shares of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or
subscription rights and any shares of Common Stock) which the Holder would have been entitled to receive upon the occurrence or
consummation of such Corporate Event or the record, eligibility or other determination date for the event resulting in such Corporate
Event, had this Note been converted immediately prior to such Corporate Event or the record, eligibility or other determination
date for the event resulting in such Corporate Event (without regard to any limitations on conversion of this Note). Provision
made pursuant to the preceding sentence shall be in a form and substance reasonably satisfactory to the Required Holders. The provisions
of this Section 6 shall apply similarly and equally to successive Corporate Events.

 

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(7)         RIGHTS
UPON ISSUANCE OF OTHER SECURITIES.

 

(a)          Adjustment
of Conversion Price upon Subdivision or Combination of Common Stock. If the Company at any time on or after the Subscription
Date subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares
of Common Stock into a greater number of shares, the Conversion Price in effect immediately prior to such subdivision will be proportionately
reduced. If the Company at any time on or after the Subscription Date combines (by combination, reverse stock split or otherwise)
one or more classes of its outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately
prior to such combination will be proportionately increased. Any adjustment under this Section 7(a)
shall become effective at the close of business on the date the subdivision or combination becomes effective.

 

(b)          Voluntary
Adjustment by Company. The Company may at any time during the term of this Note, with the prior written consent of the Required
Holders, reduce the then current Conversion Price to any amount and for any period of time deemed appropriate by the Board of Directors
of the Company.

 

(c)          Event
of Default Conversion Price. At any time from and after the occurrence of an Event of Default and continuing after such occurrence
until the date that is twenty (20) Trading Days immediately following the date such Event of Default is cured or waived in writing
by the Holder and all holders of Other Notes, the Holder may at any time and from time to time, at the Holder's option, deliver
one or more Conversion Notices to the Company indicating the Holder's election to convert (each, an "Event of Default Conversion",
and the date of such Event of Default Conversion, each, an "Event of Default Conversion Date") all, or any part
of, the Conversion Amount then outstanding hereunder or required to be paid to the Holder hereunder (whether payable in cash or
shares of Common Stock) (such portion of the Conversion Amount subject to such Event of Default Conversion, the "Event
of Default Conversion Amount") into shares of Common Stock at the applicable Event of Default Conversion Price in lieu
of the Conversion Price then in effect. On any Event of Default Conversion Date, the Holder may voluntarily convert any Event of
Default Conversion Amount pursuant to Section 3(c) (with "Event of Default Conversion Price" replacing "Conversion
Price" for all purposes hereunder with respect to such Event of Default Conversion) by designating in the Conversion Notice
delivered pursuant to this Section 7(c) of this Note that the Holder is electing to use the Event of Default Conversion Price for
such conversion according to this Section 7(c) by checking the box "Event of Default Conversion Price" on the applicable
Conversion Notice. The Company shall be required to, on or prior to the applicable Share Delivery Date: (A) honor such Event of
Default Conversions by delivering shares of Common Stock pursuant to the terms and conditions set forth in Section 3(c), but based
on a Conversion Price equal to the Event of Default Conversion Price and (B) in the event a Conversion Floor Price Condition occurs,
the Company shall deliver to the Holder the applicable Event of Default Conversion Cash Amount. In the event that the Holder elects
to convert pursuant to this Section 7(c), the Principal amount of the Notes so converted shall be deducted from the final Installment
Amounts to be paid hereunder on the final Installment Date, unless the Holder otherwise indicates and allocates among any Installment
Dates hereunder in the applicable Conversion Notice(s). If the Company receives a notice from any holder of Notes seeking conversion
pursuant to this Section 7(c), the Company will promptly notify all other holders of Notes in writing that a holder of Notes is
seeking such conversion and setting forth the Event of Default Conversion Amount, the Event of Default Conversion Date and the
Event of Default Conversion Price.

 

    - 18 -

     

    

 

(8)         COMPANY
CONVERSION OR REDEMPTION.

 

(a)          General.
On each applicable Installment Date, provided there has been no Equity Conditions Failure, the Company shall pay to the Holder
of this Note the Installment Amount due on such date by converting all or some of such Installment Amount into Common Stock, in
accordance with this Section 8 (a "Company Conversion"); provided, however, that the Company may,
at its option following notice to the Holder as set forth below, pay the Installment Amount by redeeming such Installment Amount
in cash (a "Company Redemption") or by any combination of a Company Conversion and a Company Redemption so long
as all of the outstanding applicable Installment Amount due on any Installment Date shall be converted and/or redeemed by the Company
on the applicable Installment Date, subject to the provisions of this Section 8. On or prior to the date which is the twenty-sixth
(26th) Trading Day prior to each Installment Date (each, an "Installment Notice Due Date"), the Company
shall deliver written notice (each, a "Company Installment Notice" and the date the Holder and all of the holders
of the Other Notes receive such notice is referred to as the "Company Installment Notice Date"), to the Holder
and each holder of the Other Notes which Company Installment Notice shall (i) either (A) confirm that the applicable Installment
Amount of the Holder's Note shall be converted to Common Stock in whole or in part pursuant to a Company Conversion (such amount
to be converted, the "Company Conversion Amount") or (B) (1) state that the Company elects to redeem for cash,
or is required to redeem for cash in accordance with the provisions of the Notes, in whole or in part, the applicable Installment
Amount pursuant to a Company Redemption and (2) specify the portion (including Interest and Late Charges, if any, on such amount
and Interest) which the Company elects or is required to redeem pursuant to a Company Redemption (such amount to be redeemed, the
"Company Redemption Amount") and the portion (including Interest and Late Charges, if any, on such amount and
Interest, if any) that is the Company Conversion Amount, which amounts, when added together, must at least equal the applicable
Installment Amount and (ii) if the Installment Amount is to be paid, in whole or in part, in Common Stock pursuant to a Company
Conversion, certify that the Equity Conditions have been satisfied as of the Company Installment Notice Date. Each Company Installment
Notice shall be irrevocable. If the Company does not timely deliver a Company Installment Notice in accordance with this Section
8, then the Company shall be deemed to have delivered an irrevocable Company Installment Notice confirming a Company Conversion
and shall be deemed to have certified that the Equity Conditions in connection with any such conversion on the Company Installment
Notice Date and Installment Date have been satisfied. The Company shall convert and/or redeem the applicable Installment Amount
of this Note pursuant to this Section 8 and the corresponding Installment Amounts of the Other Notes pursuant to the corresponding
provisions of the Other Notes in the same ratio of the Installment Amount being converted and/or redeemed hereunder. The Company
Conversion Amount (whether set forth in the Company Installment Notice or by operation of this Section 8) shall be converted in
accordance with Section 8(b) and the Company Redemption Amount shall be redeemed in accordance with Section 8(c). Notwithstanding
anything herein to the contrary, in the event of any partial conversion or redemption of this Note, the Principal amount converted
or redeemed shall be deducted in reverse order starting from the final Installment Amount to be paid hereunder on the final Installment
Date, unless the Holder otherwise indicates and allocates among any Installment Dates hereunder in the applicable Conversion Notice
or Redemption Notice, as applicable.

 

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(b)          Mechanics
of Company Conversion. If the Company delivers a Company Installment Notice and confirms, or is deemed to have confirmed, in
whole or in part, a Company Conversion in accordance with Section 8(a), then (1) on the third (3rd) Trading Day immediately
following the delivery of the Company Installment Notice on the applicable Company Installment Notice Date (such date, the "Initial
Pre-Installment Conversion Shares Date"), (A) the Company shall, or shall direct the Transfer Agent to, credit the Holder's
account with DTC for a number of shares of Common Stock (the "Initial Pre-Installment Conversion Shares") equal
to the quotient of (x) the Company Conversion Amount as of the applicable Installment Date divided by (y) the Initial Company Pre-Installment
Conversion Price then in effect and (B) in the event a Conversion Floor Price Condition occurs, the Company shall deliver to the
Holder the applicable Conversion Initial Pre-Installment Floor Amount, (2) in addition, in the event the Holder delivers an Acceleration
Notice (as defined in Section 8(e)) at least three (3) Trading Days prior to the applicable Installment Date, on the Trading Day
immediately following the Holder's delivery of such Acceleration Notice to the Company (such date, the "Additional Pre-Installment
Conversion Shares Date"), (A) the Company shall, or shall direct the Transfer Agent to, credit the Holder's account with
DTC for a number of shares of Common Stock (the "Additional Pre-Installment Conversion Shares" and together with
the Initial Pre-Installment Conversion Shares, the "Pre-Installment Conversion Shares") equal to the quotient
of (x) the Accelerated Amount(s) (as defined in Section 8(e)) set forth in such Acceleration Notice divided by (y) the Additional
Company Pre-Installment Conversion Price then in effect and (B) in the event a Conversion Floor Price Condition occurs, the Company
shall deliver to the Holder the applicable Conversion Additional Pre-Installment Floor Amount and (3) on the applicable Installment
Date, (A) the Company shall, or shall direct the Transfer Agent to, credit the Holder's account with DTC for an additional number
of shares of Common Stock, if any, equal to the Installment Balance Conversion Shares and (B) in the event a Conversion Floor Price
Condition occurs, the Company shall deliver to the Holder the applicable Conversion Balance Floor Amount; provided, that
the Equity Conditions have been satisfied (or waived in writing by the Holder) on each day during the period commencing on such
Company Installment Notice Date through the applicable Installment Date. On the second (2nd) Trading Day immediately
after the end of the applicable calculation period, the Company shall deliver a notice setting forth the calculation of the Installment
Balance Conversion Shares (and the calculation of the component parts of such calculation) to the Holders. If an Event of Default
occurs during the period from any Company Installment Notice Date through the applicable Installment Date, then, at the option
of the Holder indicated in writing to the Company, either (i) the Holder shall return to the Company all, or any part, of the Pre-Installment
Conversion Shares previously delivered to the Holder in connection with the applicable Installment Date or (ii) the Conversion
Amount used to calculate the applicable Event of Default Redemption Price shall be reduced by the product of (x) the number of
Pre-Installment Conversion Shares previously delivered to the Holder in connection with the applicable Installment Date multiplied
by (y) the Company Conversion Price relating to the applicable Installment Date. All Pre-Installment Conversion Shares and Installment
Balance Conversion Shares shall be fully paid and nonassessable shares of Common Stock (rounded to the nearest whole share). If
the Equity Conditions are not satisfied as of the Company Installment Notice Date, then unless the Company has elected to redeem
such Installment Amount, the Company Installment Notice shall indicate that unless the Holder waives the Equity Conditions, the
Installment Amount shall be redeemed for cash. If the Company confirmed (or is deemed to have confirmed by operation of Section
8(a)) the conversion of the applicable Company Conversion Amount, in whole or in part, and there was no Equity Conditions Failure
as of the applicable Company Installment Notice Date (or is deemed to have certified that the Equity Conditions in connection with
any such conversion have been satisfied by operation of Section 8(a)) but an Equity Conditions Failure occurred between the applicable
Company Installment Notice Date and any time through the applicable Installment Date (the "Interim Installment Period"),
the Company shall provide the Holder a subsequent notice to that effect. If the Equity Conditions are not satisfied (or waived
in writing by the Holder) during such Interim Installment Period, then at the option of the Holder designated in writing to the
Company, the Holder may require the Company to do either one of the following: (i) the Company shall redeem all or any part designated
by the Holder of the Company Conversion Amount (such designated amount is referred to as the "First Redemption Amount")
on such Installment Date and the Company shall pay to the Holder on such Installment Date, by wire transfer of immediately available
funds, an amount in cash equal to 110% of such First Redemption Amount or (ii) the Company Conversion shall be null and void with
respect to all or any part designated by the Holder of the unconverted Company Conversion Amount and the Holder shall be entitled
to all the rights of a holder of this Note with respect to such amount of the Company Conversion Amount; provided, however,
that the Conversion Price for such unconverted Company Conversion Amount shall thereafter be adjusted to equal the lesser of (A)
the Company Conversion Price as in effect on the date on which the Holder voided the Company Conversion and (B) the Company Conversion
Price as in effect on the date on which the Holder delivers a Conversion Notice relating thereto. If the Company fails to redeem
any First Redemption Amount on or before the applicable Installment Date by payment of such amount on the applicable Installment
Date, then the Holder shall have the rights set forth in Section 12(a) as if the Company failed to pay the applicable Company Installment
Redemption Price (as defined below) and all other rights under this Note (including, without limitation, such failure constituting
an Event of Default described in Section 4(a)(iv)). Notwithstanding anything to the contrary in this Section 8(b), but subject
to the limitations set forth in Section 3(d), until the Company credit the Holder's account with DTC for the shares of Common Stock
representing the Company Conversion Amount to the Holder, the Company Conversion Amount may be converted by the Holder into Common
Stock pursuant to Section 3. In the event that the Holder elects to convert the Company Conversion Amount prior to the applicable
Installment Date as set forth in the immediately preceding sentence, the Company Conversion Amount so converted shall be deducted
in reverse order starting from the final Installment Amount to be paid hereunder on the final Installment Date, unless the Holder
otherwise indicates and allocates among any Installment Dates hereunder in the applicable Conversion Notice. Notwithstanding anything
herein to the contrary, if, with respect to any Installment Date, the number of Pre-Installment Conversion Shares delivered to
the Holder exceeds the number of Post-Installment Conversion Shares with respect to such Installment Date, then the number of shares
of Common Stock equal to such excess shall constitute a credit, at the option of the Holder, against the number of shares of Common
Stock to be issued to the Holder either (x) in any conversion of this Note pursuant to Section 3(c)(i) as selected by the Holder
or (y) on the last Installment Date hereunder.

 

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(c)          Mechanics
of Company Redemption. If the Company elects a Company Redemption in accordance with Section 8, then the Company Redemption
Amount which is to be paid to the Holder on the applicable Installment Date shall be redeemed by the Company and the Company shall
pay to the Holder on such Installment Date, by wire transfer of immediately available funds, an amount in cash (the "Company
Installment Redemption Price") equal to 100% of the Company Redemption Amount. If the Company fails to redeem the Company
Redemption Amount on the applicable Installment Date by payment of the Company Installment Redemption Price on such date, then
at the option of the Holder designated in writing to the Company (any such designation shall be deemed a "Conversion Notice"
pursuant to Section 3(c) for purposes of this Note), (i) the Holder shall have the rights set forth in Section 12(a) as if the
Company failed to pay the applicable Company Installment Redemption Price and all other rights as a Holder of Notes (including,
without limitation, such failure constituting an Event of Default described in Section 4(a)(iv)) and (ii) the Holder may require
the Company to convert all or any part of the Company Redemption Amount at the Company Conversion Price as in effect on the applicable
Installment Date; provided, however, that upon payment of such Company Redemption Amount during the applicable cure period provided
by Section 4(a)(iv), such Event of Default shall be considered cured. Conversions required by this Section 8(c) shall be made in
accordance with the provisions of Section 3(c). Notwithstanding anything to the contrary in this Section 8(c), but subject to Section
3(d), until the Company Installment Redemption Price (together with any interest thereon) is paid in full, the Company Redemption
Amount (together with any interest thereon) may be converted, in whole or in part, by the Holder into Common Stock pursuant to
Section 3. In the event the Holder elects to convert all or any portion of the Company Redemption Amount prior to the applicable
Installment Date as set forth in the immediately preceding sentence, the Company Redemption Amount so converted shall be deducted
in reverse order starting from the final Installment Amount to be paid hereunder on the final Installment Date, unless the Holder
otherwise indicates and allocates among any Installment Dates hereunder in the applicable Conversion Notice.

 

(d)          Deferred
Installment Amount. Notwithstanding any provision of this Section 8 to the contrary, the Holder may at any time or times, at
its option and in its sole discretion, deliver a written notice to the Company no later than the Business Day immediately prior
to any Installment Date electing to have the payment of all or any portion of an Installment Amount payable on such Installment
Date deferred (such amount(s) deferred, the "Deferral Amount") until any subsequent Installment Date selected
by the Holder, in its sole discretion, in which case, the Deferral Amount shall be added to, and become part of, the Installment
Amount to be paid on such subsequent Installment Date and such Deferral Amount shall continue to accrue Interest hereunder. Any
notice delivered by the Holder pursuant to this Section 8(d) shall set forth (i) the Deferral Amount and (ii) the date that such
Deferral Amount shall now be payable.

 

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(e)          Accelerated
Installment Amount. Notwithstanding any provision of this Section 8 to the contrary,
regardless of whether the Company elected to pay the Installment Amount payable on the applicable Installment Date in shares of
Common Stock pursuant to a Company Conversion or in cash pursuant to a Company Redemption, the Holder may at any time or times,
at its option and in its sole discretion, deliver a written notice to the Company (an "Acceleration Notice")
no later than the third (3rd) Business Day immediately prior to the applicable Installment Date, electing to have the
payment of all or any portion of any or all Installment Amount(s) scheduled to be paid on future Installment Dates after the applicable
Installment Date accelerated (such amount(s) accelerated, the "Accelerated Amount(s)") to be paid on the applicable
Installment Date, in which case, such Accelerated Amount(s) shall be added to, and become part of, the Installment Amount payable
on such applicable Installment Date and shall be payable in Common Stock pursuant to a Company Conversion either by (x) including
such Accelerated Amount(s) in the Company Conversion Amount for the applicable Installment Date in the event the Company elected
to pay the Installment Amount scheduled to be paid on the applicable Installment Date, in whole or in part, in Common Stock pursuant
to a Company Conversion or (y) creating a Company Conversion Amount for such Accelerated Amount(s) in the event the Company elected,
or is required pursuant to the provisions of this Section 8, to pay the Installment Amount scheduled to be paid on the applicable
Installment Date, in whole or in part, in cash pursuant to a Company Redemption; provided, however, that in the event
that the Holder delivers one or more Acceleration Notices relating to an applicable Installment Date, the aggregate of the Accelerated
Amounts specified in all Acceleration Notices with respect to such Installment Date shall not be greater than four (4) times the
Installment Amount payable on such applicable Installment Date, such that the amount payable on such Installment Date may equal
up to five (5) times the Installment Amount. For the avoidance of doubt, the Holder may accelerate the Installment Amount payable
on an applicable Installment Date pursuant to this Section 8(e) with respect to one or more Installment Dates hereunder. Any notice
delivered by the Holder pursuant to this Section 8(e) shall set forth (i) the Accelerated Amount(s) and (ii) the date that such
Accelerated Amount should have been paid if not for the Holder's right to accelerate such Installment Amount(s) pursuant to this
Section 8(e). Notwithstanding anything herein to the contrary, in no event shall the Company be required to pay any Accelerated
Amount(s) in cash. To the extent the Holder delivers an Acceleration Notice at a time that the Holder is aware of an Equity Conditions
Failure, the Holder shall be deemed to have waived such Equity Conditions Failure with respect to any Accelerated Amount set forth
in such Acceleration Notice.

 

(f)          Blocker
Notice; Designated Specified Amounts. Notwithstanding the foregoing, if (i) the Company has elected to effect an Company Conversion
pursuant to this Section 8 with respect to the applicable Installment Date, (ii) the Company is permitted pursuant to this Section
8 to effect such Company Conversion on such Installment Date if not for the Equity Condition set forth in clause (iv) of such definition
and (iii) prior to such Installment Date the Holder has delivered (via facsimile or otherwise) to the Company a written notice
(a "Blocker Notice") (A) stating that such Company Conversion would result in a violation of Section 3(d)(i) and
(B) specifying the portion of the applicable Installment Amount with respect to which such Company Conversion would result in a
violation of Section 3(d)(i) if such Company Conversion were effected (such amount so specified is referred to herein as the "Designated
Specified Amount"), at the option of the Holder, the Holder may elect to either (x) defer such Designated Specified
Amount to a future Installment Date pursuant to Section 8(d) or (y) require the Company to hold the shares of Common Stock issuable
to the Holder pursuant to such Company Conversion of the Designated Specified Amount in abeyance for the Holder until such time
or times as its right thereto would not result in the Holder and its other Attribution Parties exceeding the Maximum Percentage,
at which time or times the Holder shall be delivered such shares to the extent as if there had been no such limitation.

 

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(9)         OPTIONAL
REDEMPTION AT THE COMPANY'S ELECTION.

 

(a)     General.     At
any time after the Issuance Date, so long as there has been no Equity Conditions Failure during the period beginning on the first
day of the applicable Equity Conditions Measuring Period prior to the applicable Company Optional Redemption Notice Date (as defined
below) through the applicable Company Optional Redemption Date (as defined below), the Company shall have the right to redeem all
or any portion of the Conversion Amount then remaining under this Note and the Other Notes (the "Company Optional
Redemption Amount") as designated in the applicable Company Optional Redemption Notice on the applicable Company Optional
Redemption Date (each as defined below) (a "Company Optional Redemption"). The portion of this Note and the Other
Notes subject to redemption pursuant to this Section 9 shall be redeemed by the Company on the applicable Company Optional Redemption
Date in cash by wire transfer of immediately available funds pursuant to wire instructions provided by the Holder in writing to
the Company at a price equal to the greater of (x) 118% of the Conversion Amount being redeemed and (y) 115% of the product of
(A) the Conversion Amount being redeemed and (B) the quotient determined by dividing (I) the greatest Closing Sale Price of the
shares of Common Stock during the period beginning on the date immediately preceding the applicable Company Optional Redemption
Notice Date and ending on the applicable Company Optional Redemption Date (each as defined below), by (II) the lowest Conversion
Price in effect during such period (the "Company Optional Redemption Price"). The Company may exercise its right
to require redemption under this Section 9 by delivering a written notice thereof by facsimile or electronic mail and overnight
courier to the Holder and all, but not less than all, of the holders of the Other Notes (the "Company Optional Redemption
Notice" and the date all of the holders of the Notes received such notice is referred to as the "Company Optional
Redemption Notice Date"). Each Company Optional Redemption Notice shall be irrevocable. Each Company Optional Redemption
Notice shall (i) state the date on which the applicable Company Optional Redemption shall occur (the "Company Optional
Redemption Date"), which date shall not be less than sixty (60) days nor more than seventy (70) days following the applicable
Company Optional Redemption Notice Date and (ii) state the aggregate Conversion Amount of the Notes which the Company has
elected to be subject to Company Optional Redemption from the Holder and all of the holders of the Other Notes pursuant to this
Section 9(a) (and analogous provisions under the Other Notes) on the applicable Company Optional Redemption Date and (iii) certify
that there has been no Equity Conditions Failure during the period beginning on the first day of the applicable Equity Conditions
Measuring Period prior to the applicable Company Optional Redemption Date through the applicable Company Optional Redemption Notice
Date. If the Company confirmed that there was no such Equity Conditions Failure as of the applicable Company Optional Redemption
Notice Date but an Equity Conditions Failure occurs between the applicable Company Optional Redemption Notice Date and any time
through the applicable Company Optional Redemption Date (the "Company Optional Redemption Interim Period"), the
Company shall provide the Holder a subsequent notice to that effect. If there is an Equity Conditions Failure (which is not waived
in writing by the Holder) during such Company Optional Redemption Interim Period, then the applicable Company Optional Redemption
shall be null and void with respect to all or any part designated by the Holder of the unconverted Company Optional Redemption
Amount and the Holder shall be entitled to all the rights of a holder of this Note with respect to such amount of the applicable
Company Optional Redemption Amount. The Company may not effect more than one (1) Company Optional Redemption during any six (6)
month period. Notwithstanding anything to the contrary in this Section 9, until the applicable Company Optional Redemption Price
is paid, in full, the applicable Company Optional Redemption Amount may be converted, in whole or in part, by the Holder into shares
of Common Stock pursuant to Section 3. All Conversion Amounts converted by the Holder after the applicable Company Optional Redemption
Notice Date shall reduce the applicable Company Optional Redemption Amount of this Note required to be redeemed on the applicable
Company Optional Redemption Date, unless the Holder otherwise indicates in the applicable Conversion Notice. Company Optional Redemptions
made pursuant to this Section 9 shall be made in accordance with Section 12. To the extent redemptions required by this Section
9 are deemed or determined by a court of competent jurisdiction to be prepayments of the Note by the Company, such redemptions
shall be deemed to be voluntary prepayments. In the event of a partial redemption of this Note pursuant hereto, the Principal amount
redeemed shall be deducted in reverse order starting from the final Installment Amount to be paid hereunder on the final Installment
Date, unless the Holder otherwise indicates and allocates among any Installment Dates hereunder in a written notice to the Company.
The parties hereto agree that in the event of the Company's redemption of any portion of the Note under this Section 9, the Holder's
damages would be uncertain and difficult to estimate because of the parties' inability to predict future interest rates and the
uncertainty of the availability of a suitable substitute investment opportunity for the Holder.

 

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(b)          Pro
Rata Redemption Requirement. If the Company elects to cause a Company Optional Redemption pursuant to Section 9(a), then it
must simultaneously take the same action in the same proportion with respect to the Other Notes. If the Company elects to cause
a Company Optional Redemption pursuant to Section 9(a) (or similar provisions under the Other Notes) with respect to less than
all of the Conversion Amounts of the Notes then outstanding, then the Company shall require redemption of a Conversion Amount from
each of the holders of the Notes equal to the product of (i) the aggregate Company Optional Redemption Amount of Notes which the
Company has elected to cause to be redeemed pursuant to Section 9(a), multiplied by (ii) the fraction, the numerator of which is
the sum of the aggregate Original Principal Amount of the Notes purchased by such holder of outstanding Notes and the denominator
of which is the sum of the aggregate Original Principal Amount of the Notes purchased by all holders holding outstanding Notes
(such fraction with respect to each holder is referred to as its "Company Optional Redemption Allocation Percentage",
and such amount with respect to each holder is referred to as its "Pro Rata Company Optional Redemption Amount");
provided, however that in the event that any holder's Pro Rata Company Optional Redemption Amount exceeds the outstanding Principal
amount of such holder's Note, then such excess Pro Rata Company Optional Redemption Amount shall be allocated amongst the remaining
holders of Notes in accordance with the foregoing formula. In the event that the initial holder of any Notes shall sell or otherwise
transfer any of such holder's Notes, the transferee shall be allocated a pro rata portion of such holder's Company Optional Redemption
Allocation Percentage and Pro Rata Company Optional Redemption Amount.

 

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(10)        NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Articles of Incorporation, Bylaws or through
any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities,
or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will
at all times in good faith carry out all of the provisions of this Note and take all action as may be required to protect the rights
of the Holder of this Note. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value
of any shares of Common Stock receivable upon the conversion of this Note above the Conversion Price then in effect, (ii) shall
take all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and
nonassessable shares of Common Stock upon the conversion of this Note and the Other Notes, and (iii) shall, so long as any of this
Note and the Other Notes are outstanding, take all action necessary to reserve and keep available out of its authorized and unissued
shares of Common Stock, solely for the purpose of effecting the conversion of this Note and the Other Notes, the number of shares
of Common Stock equal to the Required Reserve Amount (as defined in Section 11(a)) to effect the conversion of the this Note and
the Other Notes then outstanding (without regard to any limitations on conversion).

 

(11)        RESERVATION
OF AUTHORIZED SHARES.

 

(a)          Reservation.
The Company shall initially reserve out of its authorized and unissued shares of Common Stock
a number of shares of Common Stock for each of this Note and the Other Notes equal to 200% of the maximum number of shares
of Common Stock as shall from time to time be necessary to effect the conversion of the Conversion
Amount of each such Note as of the Issuance Date determined utilizing the Equity Conditions Conversion Price.
So long as any of this Note and the Other Notes are outstanding, the Company shall take all action necessary to reserve and keep
available out of its authorized and unissued Common Stock, solely for the purpose of effecting the conversion of this Note and
the Other Notes, the number of shares of Common Stock specified above in this Section 11(a) or such additional number of shares
of Common Stock as shall from time to time be necessary to effect the conversion of all of the Notes then outstanding utilizing
the Equity Conditions Conversion Price then in effect (in each case, without regard to any limitations on conversions) (the "Required
Reserve Amount"). The initial number of shares of Common Stock reserved for conversions of this Note and the Other Notes
and each increase in the number of shares so reserved shall be allocated pro rata among the Holder and the holders of the Other
Notes based on the Principal amount of this Note and the Other Notes held by each holder at the Closing (as defined in the Securities
Purchase Agreement) or increase in the number of reserved shares, as the case may be (the "Authorized Share Allocation").
In the event that a holder shall sell or otherwise transfer this Note or any of such holder's Other Notes, each transferee shall
be allocated a pro rata portion of such holder's Authorized Share Allocation. Any shares of Common Stock reserved and allocated
to any Person which ceases to hold any Notes shall be allocated to the Holder and the remaining holders of Other Notes, pro rata
based on the Principal amount of this Note and the Other Notes then held by such holders.

 

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(b)          Insufficient
Authorized Shares. If at any time while any of the Notes remain outstanding the Company does not have a number of authorized
and unreserved shares of Common Stock that is equal to or greater than the Required Reserve Amount (an "Authorized Share
Failure"), then the Company shall promptly take all action reasonably necessary to increase the Company's authorized shares
of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount for the Notes and Warrants
then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the occurrence
of an Authorized Share Failure, but in no event later than seventy-five (75) days after the occurrence of such Authorized Share
Failure, the Company shall either (x) obtain the written consent of its shareholders for the approval of an increase in the number
of authorized shares of Common Stock and provide each shareholder with an information statement with respect thereto or (y) hold
a meeting of its shareholders for the approval of an increase in the number of authorized shares of Common Stock. In connection
with such meeting, the Company shall provide each shareholder with a proxy statement and shall use its reasonable best efforts
to solicit its shareholders' approval of such increase in authorized shares of Common Stock and to cause its Board of Directors
to recommend to the shareholders that they approve such proposal. Notwithstanding the foregoing, if during any such time of an
Authorized Share Failure, the Company is able to obtain the written consent of a majority of the shares of its issued and outstanding
Common Stock to approve the increase in the number of authorized shares of Common Stock, the Company may satisfy this obligation
by obtaining such consent and submitting for filing with the SEC an Information Statement on Schedule 14C. If, upon any conversion
of this Note, the Company does not have sufficient authorized shares to deliver in satisfaction of such conversion, then unless
the Holder elects to void such attempted conversion, the Holder may require the Company to pay to the Holder within three (3) Trading
Days of the applicable attempted conversion, cash by wire transfer of immediately available funds, in exchange for cancellation
of the applicable portion of the Conversion Amount that is subject to such Conversion Notice, which cash amount for each share
of Common Stock that the Company is unable to deliver pursuant to this Section 11 shall be equal to the highest trading price of
the Common Stock in effect at any time during the period beginning on the applicable Conversion Date and ending on the date the
Company makes the payment provided for in this sentence.

 

(12)        REDEMPTIONS.

 

(a)          Mechanics.
The Company shall deliver the applicable Event of Default Redemption Price to the Holder within three (3) Business Days after the
Company's receipt of the Holder's Event of Default Redemption Notice (the "Event of Default Redemption Date").
If the Holder has submitted a Change of Control Redemption Notice in accordance with Section 5(b), the Company shall deliver the
applicable Change of Control Redemption Price to the Holder (i) concurrently with the consummation of such Change of Control if
such notice is received prior to the consummation of such Change of Control and (ii) within three (3) Business Days after the Company's
receipt of such notice if such notice is received after the consummation of such Change of Control (such date, the "Change
of Control Redemption Date"). The Company shall deliver the applicable Company Installment Redemption Price to the Holder
on the applicable Installment Date. The Company shall deliver the applicable Company Optional Redemption Price to the Holder on
the applicable Company Optional Redemption Date. The Company shall pay the applicable Redemption Price to the Holder in cash by
wire transfer of immediately available funds pursuant to wire instruction provided by the Holder in writing to the Company on the
applicable due date. In the event of a redemption of less than all of the Conversion Amount of this Note, the Company shall promptly
cause to be issued and delivered to the Holder a new Note (in accordance with Section 21(d)) representing the outstanding Principal
which has not been redeemed and any accrued Interest on such Principal which shall be calculated as if no Redemption Notice has
been delivered. In the event that the Company does not pay the applicable Redemption Price to the Holder within the time period
required, at any time thereafter and until the Company pays such unpaid Redemption Price in full, the Holder shall have the option,
in lieu of redemption, to require the Company to promptly return to the Holder all or any portion of this Note representing the
Conversion Amount that was submitted for redemption and for which the applicable Redemption Price (together with any Late Charges
thereon) has not been paid. Upon the Company's receipt of such notice, (x) the applicable Redemption Notice shall be null and void
with respect to such Conversion Amount, (y) the Company shall immediately return this Note, or issue a new Note (in accordance
with Section 21(d)) to the Holder representing such Conversion Amount to be redeemed and (z) the Conversion Price of this Note
or such new Notes shall be adjusted to the lesser of (A) the Conversion Price as in effect on the date on which the applicable
Redemption Notice is voided and (B) the lowest Closing Bid Price of the Common Stock during the period beginning on and including
the date on which the applicable Redemption Notice is delivered to the Company and ending on and including the date on which the
applicable Redemption Notice is voided. The Holder's delivery of a notice voiding a Redemption Notice and exercise of its rights
following such notice shall not affect the Company's obligations to make any payments of Late Charges which have accrued prior
to the date of such notice with respect to the Conversion Amount subject to such notice.

 

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(b)          Redemption
by Other Holders. Upon the Company's receipt of notice from any of the holders of the Other Notes for redemption or repayment
as a result of an event or occurrence substantially similar to the events or occurrences described in Section 4(b), Section 5(b),
Section 8 or Section 9 or pursuant to equivalent provisions set forth in the Other Notes (each, an "Other Redemption Notice"),
the Company shall immediately, but no later than one (1) Business Day after its receipt thereof, forward to the Holder by facsimile
or electronic mail a copy of such notice. If the Company receives a Redemption Notice and one or more Other Redemption Notices,
during the seven (7) Business Day period beginning on and including the date which is three (3) Business Days prior to the Company's
receipt of the Holder's Redemption Notice and ending on and including the date which is three (3) Business Days after the Company's
receipt of the Holder's Redemption Notice and the Company is unable to redeem all Principal, Interest and other amounts designated
in such Redemption Notice and such Other Redemption Notices received during such seven (7) Business Day period, then the Company
shall redeem a pro rata amount from the Holder and each holder of the Other Notes (including the Holder) based on the Principal
amount of this Note and the Other Notes submitted for redemption pursuant to such Redemption Notice and such Other Redemption Notices
received by the Company during such seven (7) Business Day period.

 

(c)          Insufficient
Assets. If upon a Redemption Date, the assets of the Company are insufficient to pay the applicable Redemption Price, the Company
shall (i) take all appropriate action reasonably within its means to maximize the assets available for paying the applicable Redemption
Price, (ii) redeem out of all such assets available therefor on the applicable Redemption Date the maximum possible Conversion
Amount that it can redeem on such date, pro rata among the Holder and the holders of the Other Notes to be redeemed in proportion
to the aggregate Principal amount of this Note and the Other Notes outstanding on the applicable Redemption Date and (iii) following
the applicable Redemption Date, at any time and from time to time when additional assets of the Company become available to redeem
the remaining Conversion Amount of this Note and the Other Notes, the Company shall use such assets, at the end of the then current
calendar month, to redeem the balance of such Conversion Amount of this Note and the Other Notes, or such portion thereof for which
assets are then available, on the basis set forth above at the applicable Redemption Price, and such assets will not be used prior
to the end of such calendar month for any other purpose. Interest on the Principal amount of this Note and the Other Notes that
have not been redeemed shall continue to accrue until such time as the Company redeems this Note and the Other Notes. The Company
shall pay to the Holder the applicable Redemption Price hereunder unless expressly prohibited by applicable law or unless the payment
of the applicable Redemption Price hereunder could reasonably be expected to result in personal liability to the directors of the
Company.

 

    - 27 -

     

    

 

(13)        VOTING
RIGHTS. The Holder shall have no voting rights as the holder of this Note, except as required by law and as expressly provided
in this Note.

 

(14)        SECURITY.
This Note and the Other Notes are secured to the extent and in the manner set forth in the Holder's Master Control Account Agreement.

 

(15)        RANK.
All payments due under this Note (a) shall rank pari passu with all Other Notes and (b) shall be senior to all other Indebtedness
of the Company and its Subsidiaries.

 

(16)        NEGATIVE
COVENANTS. Until all of the Notes have been converted, redeemed or otherwise satisfied in accordance with their respective
terms, the Company shall not, and the Company shall not permit any of its Subsidiaries without the prior written consent of the
Required Holders to, directly or indirectly:

 

(a)          incur
or guarantee, assume or suffer to exist any Indebtedness, other than Permitted Indebtedness;

 

(b)          allow
or suffer to exist any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by the Company or any of its Subsidiaries (collectively, "Liens")
other than Permitted Liens;

 

(c)          redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part,
whether by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness
(other than this Note, the Other Notes and the Permitted Senior Indebtedness), whether by way of payment in respect of principal
of (or premium, if any) or interest on, such Indebtedness if at the time such payment is due or is otherwise made or, after giving
effect to such payment, an event constituting, or that with the passage of time and without being cured would constitute, an Event
of Default has occurred and is continuing;

 

(d)          redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part,
whether by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness
(including, without limitation Permitted Indebtedness other than this Note and the Other Notes), by way of payment in respect of
principal of (or premium, if any) such Indebtedness. For clarity, such restriction shall not preclude the payment of regularly
scheduled interest, principal and letter of credit payments or interest or penalties on past-due amounts which may accrue under
such Permitted Indebtedness;

 

    - 28 -

     

    

 

(e)          redeem
or repurchase its Equity Interest, or permit any Subsidiary to redeem or repurchase its Equity Interests (except on a pro rata
basis among all holders thereof) or declare or pay any cash dividend or distribution on any Equity Interest of the Company or of
its Subsidiaries without in each case the prior express written consent of the Required Holders; provided, however,
that this Section 16(e) shall not prohibit the Company from exchanging warrants issued in the Company's February 2015 public offering
(the "Existing Warrants") for a number of shares of Common Stock not to exceed 15,000 (as adjusted for any stock
dividend, stock split, stock combination, reclassification or similar transaction occurring after the Subscription Date); provided,
further, that the Existing Warrants shall not be amended on or after the Subscription Date.

 

(f)          make
any material change in the nature of its business as described in the Company's most recent Annual Report filed on Form 10-K with
the SEC. The Company shall not modify its corporate structure or purpose in any material respect;

 

(g)          encumber
or allow any Liens on, any of its copyright rights, copyright applications, copyright registrations and like protections in each
work of authorship and derivative work, whether published or unpublished, any patents, patent applications and like protections,
including improvements, divisions, continuations, renewals, reissues, extensions, and continuations-in-part of the same, trademarks,
service marks and, to the extent permitted under applicable law, any applications therefor, whether registered or not, and the
goodwill of the business of the Company and its Subsidiaries connected with and symbolized thereby, know-how, operating manuals,
trade secret rights, rights to unpatented inventions, and any claims for damage by way of any past, present, or future infringement
of any of the foregoing, other than Permitted Liens; or

 

(h)          enter
into, renew, extend or be a party to, any transaction or series of related transactions (including, without limitation, the purchase,
sale, lease, transfer or exchange of property or assets of any kind or the rendering of services of any kind) with any Affiliate,
except in the ordinary course of business in a manner and to an extent consistent with past practice and necessary or desirable
for the prudent operation of its business, for fair consideration and on terms no less favorable to it or its Subsidiaries than
would be obtainable in a comparable arm's length transaction with a Person that is not an Affiliate thereof.

 

(17)        AFFIRMATIVE
COVENANTS.

 

(a)          General.
Until all of the Notes have been converted, redeemed or otherwise satisfied in accordance with their respective terms, the Company
shall, and the Company shall cause each Subsidiary to, directly or indirectly:

 

(i)          maintain
and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence, rights and privileges, and become or
remain, and cause each of its Subsidiaries to become or remain, duly qualified and in good standing in each jurisdiction in which
the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary,
except to the extent that the failure to be so qualified or be in good standing, or with respect to each Subsidiary to maintain
and preserve its existence, would not reasonably be expected to have a Material Adverse Effect;

 

    - 29 -

     

    

 

(ii)         maintain
and preserve, and cause each of its Subsidiaries to maintain and preserve, all of its material properties which are necessary in
the proper conduct of its business in good working order and condition, ordinary wear and tear excepted, and comply in all material
respects, and cause each of its Subsidiaries to comply in all material respects, at all times with the provisions of all leases
to which it is a party as lessee or under which it occupies property, so as to prevent any loss or forfeiture thereof or thereunder;

 

(iii)        maintain,
and cause each of its Subsidiaries to maintain, insurance with responsible and reputable insurance companies or associations (including,
without limitation, comprehensive general liability, hazard, rent and business interruption insurance) with respect to its material
properties (including all real properties leased or owned by it) and business, in such amounts and covering such risks as is required
by any governmental authority having jurisdiction with respect thereto or as is carried generally in accordance with sound business
practice by companies in similar businesses similarly situated; and

 

(iv)        maintain
and preserve, and cause each of its Subsidiaries to maintain and preserve, all of its material Intellectual Property Rights (as
defined in the Securities Purchase Agreement) which are necessary in the proper conduct of its business.

 

(b)          Holder's
Master Restricted Account.

 

(i)          General.
The Company shall establish and maintain a bank account for each holder of Notes (collectively, including the Holder's Master
Restricted Account, the "Master Restricted Accounts") at  Bank of Hawaii (the "Control Account
Bank"), which Master Restricted Account applicable to a holder of Notes shall be subject to an account control
agreement in the form set forth in Exhibit D to the Securities Purchase Agreement (each, a "Master
Control Account Agreement"). On the Issuance Date, the Company shall have directed the Purchasers to deposit an
aggregate of $11,250,000 of the aggregate Purchase Prices (as defined in the Securities Purchase Agreement) for all holders
of Notes into Master Restricted Accounts.

 

(ii)         Control
Account Release. Upon the occurrence of any Control Account Company Release Event, the Holder shall, as soon as commercially
practicable, but in no event later than two (2) Trading Days thereafter, cause the applicable Control Account Release Amount to
be released from the Holder's Master Restricted Account and deposited into the bank account of the Company specified in the Master
Control Account Agreement (each a "Control Account Company Release"). Upon the occurrence of any Control Account
Holder Release Event, the Holder shall be entitled to cause the applicable Control Account Release Amount to be released from the
Holder's Master Restricted Account and deposited into the Holder's bank account (each a "Control Account Holder Release"
and together with a Control Account Release, a "Control Account Release").

 

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(iii)        Grant
of Security Interest. The Company hereby grants and pledges to the Holder a continuing security interest in the Holder's Master
Restricted Account, including any and all cash, proceeds, funds, credits, rights and other assets therein or arising therefrom,
from time to time, and any additions, dividends, profits and interest in the foregoing and any replacements or substitutions therefore
(collectively, the "Master Control Account Collateral") to secure prompt repayment of any and all amounts outstanding
hereunder from time to time and to secure prompt performance by the Company of each of its covenants and duties under the Transaction
Documents. Such security interest constitutes a valid, first priority security interest in the presently existing Master Control
Account Collateral, and will constitute a valid, first priority security interest in later-acquired Master Control Account Collateral.
Notwithstanding any filings undertaken related to Holder's rights under the New York Uniform Commercial Code, the Holder's Lien
on the Master Control Account Collateral shall remain in effect for so long as any Restricted Principal remains outstanding. Notwithstanding
the foregoing, upon any Control Account Release, but solely with respect to such portion of the Restricted Principal hereunder
subject to such Control Account Release (each, a "Control Account Release Amount"), the Holder hereby automatically
releases any lien hereunder on such Control Account Release Amount.

 

(iv)        Cash
Payment Obligations. Notwithstanding anything herein to the contrary, any redemption or other cash payment obligation of the
Company that has then become due hereunder and/or pursuant to any other Transaction Document (each, a "Cash Payment Obligation")
due to the Holder, may be satisfied from the Master Control Account Collateral in the Holder's Master Restricted Account (and not
any other Master Restricted Account of any holder of Other Notes), including, without limitation, in connection with any Event
of Default, Change of Control, Company Installment Redemption or payment due on the Maturity Date, in each case, to the extent
there is cash available in such Holder's Master Restricted Account. The Company shall pay to the Holder any Cash Payment Obligation
that cannot be satisfied from the Master Control Account Collateral in the Holder's Master Restricted Account in accordance with
the applicable provisions of the applicable Transaction Document giving rise to such Cash Payment Obligation. The Company hereby
irrevocably consents to the Holder's delivery of an instruction letter to the Control Account Bank to release Master Control Account
Collateral to the Holder from the Holder's Master Restricted Account, in each case, in an amount not to exceed any Cash Payment
Obligation. For the avoidance of doubt, upon any payment from the Holder's Master Restricted Account of any cash amount due hereunder,
any default related to such cash payment shall be deemed cured if made in the applicable cure period, if any, and the Holder shall
have no other rights hereunder with respect to such payment of such cash amount.

 

(v)         Breach
of Master Control Account Agreement. If the Control Account Bank breaches any covenant or other term or condition of any Master
Control Account Agreement or otherwise fails to promptly comply with the instructions of the Holder in connection with the Master
Control Account Collateral, the Holder may, at its option, withdraw the Master Control Account Collateral from the Control Account
Bank and hold such Master Control Account Collateral until such time as (x) the Company and the Holder have agreed upon a replacement
of the Control Account Bank and (y) an account control agreement similar in form and substance to the Master Control Account Agreement
that is reasonably acceptable to the Holder shall have been duly executed by the Company, the Holder and the replacement of the
Control Account Bank and a new account shall have been opened. Notwithstanding anything herein to the contrary, if the Company
or any of its Subsidiaries receives any of the Master Control Account Collateral in breach of any Master Control Account Agreement
(or receives notice from any holder of Notes that an amount was wired to the Company from a Master Restricted Account attributable
to such holder of Notes without the proper authorization of such holder of Notes), the Company shall promptly cause such amounts
to be returned to such applicable Master Restricted Account.

 

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(18)        VOTE
TO ISSUE, OR CHANGE THE TERMS OF, NOTES. The affirmative vote at a meeting duly called for such purpose or the written consent
without a meeting of the Required Holders shall be required for any change or amendment or waiver of any provision to this Note
or any of the Other Notes. Any change, amendment or waiver by the Company and the Required Holders shall be binding on the Holder
of this Note and all holders of the Other Notes.

 

(19)        TRANSFER.
This Note and any portion hereof may be offered, sold, assigned or transferred by the Holder upon five (5) Business Day prior written
notice to the Company and shall be subject to the prior written consent of the Company, which consent shall not be unreasonably
withheld, delayed or conditioned, except that no such consent shall be required to offer, sell, assign or transfer this Note (or
any portion hereof) to a Purchaser or to an Affiliate of the Holder; provided, however, that any such offer, sale,
assignment or transfer shall be subject to the provisions of Section 2(f) of the Securities Purchase Agreement. The shares of Common
Stock issued and issuable upon conversion of this Note may be offered, sold, assigned or transferred by the Holder without the
consent of the Company and, except for such shares sold pursuant to an effective registration statement or pursuant to Rule 144,
shall be offered for sale, sold, transferred, pledged or assigned in accordance with Section 2(f) of the Securities Purchase Agreement
and subject to Section 2(g) of the Securities Purchase Agreement.

 

(20)        REISSUANCE
OF THIS NOTE.

 

(a)          Transfer.
If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue
and deliver upon the order of the Holder a new Note (in accordance with Section 21(d) and subject to Section 3(c)(iii)), registered
as the Holder may request, representing the outstanding Principal being transferred by the Holder and, if less than the entire
outstanding Principal is being transferred, a new Note (in accordance with Section 21(d)) to the Holder representing the outstanding
Principal not being transferred. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason
of the provisions of Section 3(c)(iii) following conversion or redemption of any portion of this Note, the outstanding Principal
represented by this Note may be less than the Principal stated on the face of this Note.

 

(b)          Lost,
Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the
Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company
shall execute and deliver to the Holder a new Note (in accordance with Section 21(d)) representing the outstanding Principal.

 

    - 32 -

     

    

 

(c)          Note
Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the principal
office of the Company, for a new Note or Notes (in accordance with Section 21(d) and in Principal amounts of at least $25,000)
representing in the aggregate the outstanding Principal of this Note, and each such new Note will represent such portion of such
outstanding Principal as is designated by the Holder at the time of such surrender.

 

(d)          Issuance
of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note (i) shall
be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding
(or in the case of a new Note being issued pursuant to Section 21(a) or Section 21(c), the Principal designated by the Holder which,
when added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal
remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated
on the face of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have the same rights and conditions
as this Note, and (v) shall represent accrued and unpaid Interest and Late Charges, if any, on the Principal and Interest of this
Note, from the Issuance Date.

 

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

 

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

 

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

 

(24)        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.

 

(25)        DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Closing Bid Price, the Closing Sale Price or the Weighted
Average Price or the arithmetic calculation of the Conversion Rate, the Conversion Price or any Redemption Price or any other calculation
under this Note, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail
within two (2) Business Days after receipt of the Conversion Notice or Redemption Notice or other event giving rise to such dispute,
as the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation within
three (3) Business Days after such disputed determination or arithmetic calculation being submitted to the Holder, then the Company
shall, within one (1) Business Day submit via facsimile or electronic mail (a) the disputed determination of the Closing Bid Price,
the Closing Sale Price or the Weighted Average Price to an independent, reputable investment bank selected by the Holder and approved
by the Company, such approval not to be unreasonably withheld, delayed or conditioned, or (b) the disputed arithmetic calculation
of the Conversion Rate, Conversion Price or any Redemption Price to an independent, outside accountant, selected by the Holder
and approved by the Company, such approval not to be unreasonably withheld, delayed or conditioned. The Company shall cause at
its expense the investment bank or the accountant, as the case may be, to perform the determinations or calculations and notify
the Company and the Holder of the results no later than ten (10) Business Days from the time it receives the disputed determinations
or calculations. Such investment bank's or accountant's determination or calculation, as the case may be, shall be binding upon
all parties absent demonstrable error.

 

(26)        NOTICES;
PAYMENTS.

 

(a)          Notices.
Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance
with Section 9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all
actions taken pursuant to this Note, including in reasonable detail a description of such action and the reason therefore. Without
limiting the generality of the foregoing, the Company shall give written notice to the Holder (i) promptly upon any adjustment
of the Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least
twenty (20) days prior to the date on which the Company closes its books or takes a record, as applicable, (A) with respect to
any dividend or distribution upon the Common Stock, (B) with respect to any grants, issuances or sales of any Options, Convertible
Securities or rights to purchase stock, warrants, securities or other property to holders of shares of Common Stock or (C) for
determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that
such information shall be made known to the public prior to or in conjunction with such notice being provided to the Holder. It
is expressly understood and agreed that the time of exercise specified by the Holder in each Conversion Notice shall be definitive
and may not be disputed or challenged by the Company.

 

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(b)          Payments.
Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, such payment shall be made in lawful
money of the United States of America by a check drawn on the account of the Company and sent via overnight courier service to
such Person at such address as previously provided to the Company in writing (which address, in the case of each of the Purchasers,
shall initially be as set forth on the Schedule of Buyers attached to the Securities Purchase Agreement); provided, that
the Holder may elect to receive a payment of cash via wire transfer of immediately available funds by providing the Company with
prior written notice setting out such request and the Holder's wire transfer instructions. Whenever any amount expressed to be
due by the terms of this Note is due on any day which is not a Business Day, the same shall instead be due on the next succeeding
day which is a Business Day. Any amount of Principal or other amounts due under the Transaction Documents which is not paid when
due shall result in a late charge being incurred and payable by the Company in an amount equal to interest on such amount at the
rate of eighteen percent (18.0%) per annum from the date such amount was due until the same is paid in full ("Late Charge").

 

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

 

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

 

(29)        GOVERNING
LAW; JURISDICTION; JURY TRIAL. This Note shall be governed by and construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and performance of this Note shall be governed by, the internal laws of the
State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New
York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New
York. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City
of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is improper. The Company hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof
to the Company at the address set forth in Section 9(f) of the Securities Purchase Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude
the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company's
obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce a judgment or
other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST,
A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION
CONTEMPLATED HEREBY.

 

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

 

(31)        DISCLOSURE.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless the Company has in good
faith determined that the matters relating to such notice do not constitute material, nonpublic information relating to the Company
or its Subsidiaries, the Company shall within one (1) Business Day after any such receipt or delivery publicly disclose such material,
nonpublic information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains
material, nonpublic information relating to the Company or its Subsidiaries, the Company so shall indicate to the Holder contemporaneously
with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters
relating to such notice do not constitute material, nonpublic information relating to the Company or its Subsidiaries. Notwithstanding
anything contrary in this Note, the Company shall not, and shall cause each of its Subsidiaries and its and each of their respective
officers, directors, employees, Affiliates and agents, not to, provide the Holder with any material, nonpublic information regarding
the Company or any of its Subsidiaries from and after the date hereof without the express prior written consent of Holder and the
Company shall not be in breach of the terms of this Note if such material, nonpublic information is not provided to the Holder
because no such prior written consent is provided to the Company.

 

(32)        CERTAIN
DEFINITIONS. For purposes of this Note, the following terms shall have the following meanings:

 

(a)          "1933
Act" means the Securities Act of 1933, as amended, and the rules and regulations thereunder.

 

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(b)          "1934
Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

 

(c)          "Actual
Market Price" means 85% of the lower of (i) the arithmetic average of the five (5) lowest daily Weighted Average
Prices of the Common Stock during the twenty (20) consecutive Trading Day period ending on the Trading Day immediately
preceding the applicable date of determination and (ii) the Weighted Average Price of the Common Stock on the Trading
Day immediately preceding the applicable date of determination. All such determinations to be appropriately adjusted for
any stock split, stock dividend, stock combination, reclassification or other similar transaction during such period.

 

(d)          "Additional
Company Pre-Installment Conversion Price" means, with respect to any Additional Pre-Installment Conversion Shares Date
or other applicable date of determination, that price which shall be the lower of (i) the then applicable Conversion Price then
in effect and (ii) the Pre-Delivery Market Price as of the applicable Additional Pre-Installment Conversion Shares Date; provided,
however, that the Additional Company Pre-Installment Conversion Price shall not be less than the Conversion Floor Price.

 

(e)          "Affiliate"
means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common
control with, such Person, it being understood for purposes of this definition that "control" of a Person means the power
directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of directors of such
Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.

 

(f)          "Attribution
Parties" means, collectively, the following Persons and entities: (i) any investment vehicle, including, any funds, feeder
funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed or advised by
the Holder's investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of the Holder or
any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or any of
the foregoing and (iv) any other Persons whose beneficial ownership of the Company's Common Stock would or could be aggregated
with the Holder's and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of
the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.

 

(g)          "Bloomberg"
means Bloomberg Financial Markets.

 

(h)          "Business
Day" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized
or required by law to remain closed.

 

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(i)          "Change
of Control" means any Fundamental Transaction other than (i) any merger of a wholly-owned Subsidiary of the Company into
the Company with the Company being the Successor Entity, (ii) any merger of a wholly-owned Subsidiary of the Company into another
wholly-owned Subsidiary of the Company, (iii) any reorganization, recapitalization or reclassification of the Common Stock in which
holders of the Company's voting power immediately prior to such reorganization, recapitalization or reclassification continue after
such reorganization, recapitalization or reclassification to hold publicly traded securities and, directly or indirectly, are,
in all material respect, the holders of the voting power of the surviving entity (or entities with the authority or voting power
to elect the members of the board of directors (or their equivalent if other than a corporation) of such entity or entities) after
such reorganization, recapitalization or reclassification or (iv) pursuant to a migratory merger effected solely for the purpose
of changing the jurisdiction of incorporation of the Company. For the avoidance of doubt, any transaction or series of transaction
that, directly or indirectly, results in the Company or the Successor Entity not having Common Stock or common stock, as applicable,
registered under the 1934 Act and listed on an Eligible Market shall be deemed a Change of Control.

 

(j)          "Closing
Bid Price" and "Closing Sale Price" means, for any security as of any date, the last closing bid price
and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price, as
the case may be, then the last bid price or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York
time, as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such
security, the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or
trading market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing
bid price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the OTC Link or "pink sheets" by OTC Markets Group Inc. (formerly Pink OTC Markets Inc.). If the Closing Bid Price
or the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such date shall be the fair market value as mutually determined
by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 26. All such determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.

 

(k)          "Closing
Date" shall have the meaning set forth in the Securities Purchase Agreement, which date is the date the Company initially
issued the Notes and the Warrants pursuant to the terms of the Securities Purchase Agreement.

 

(l)          "Control
Account Company Release Event" means, as applicable:

 

For purposes
of this Section 32(l), the following definitions shall apply:

 

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(1)         "Control
Account Release Eligibility Date" means the later of (x) the date the Company obtains the Shareholder Approval and
(y) the earlier of (I) the date the Initial Registration Statement is declared effective by the SEC and (II) the initial date the
shares of Common Stock issuable upon conversion of this Note may be freely sold by the Holder pursuant to Rule 144 of the 1933
Act without any volume limitation by the Holder (or such later date no Public Information Failure, if any, exists).

 

(2)         "First
Maximum Amount" means the Holder Pro Rata Amount of $2,000,000, less all Control Account Release Amounts released
by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Closing Date.

 

(3)         "First
Non-SEC Event Amount" means, if no SEC Event occurs, the lesser of (1) the Holder Pro Rata Amount of $2,000,000 and
(2) the NASDAQ Principal Amount of Note, less, in each case, all Control Account Release Amounts released by the Holder to the
Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Closing Date.

 

(4)         "First
Release Amount" means a dollar amount equal to the least of (A) the First SEC Event Amount, if applicable, (B) the
First Non-SEC Event Amount, if applicable, (C) the First Maximum Amount and (D) the dollar amount available in the Holder's Master
Restricted Account.

 

(5)         "First
SEC Event Amount" means, solely if an SEC Event occurs, a dollar amount equal to the lesser of (1) the Registered
Principal Amount of Note and (2) the NASDAQ Principal Amount of Note, in each case, less all Control Account Release Amounts released
by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Closing Date.

 

(6)         "First
Stub Amount" means the difference between the Holder Pro Rata Amount of $2,000,000 and the First Release Amount.

 

(7)         "Free
Tradability Date" means the date all shares of Common Stock issuable upon conversion of this Note may be freely sold
by the Holder pursuant to Rule 144 of the 1933 Act without any volume limitation by the Holder (or such later date no Public Information
Failure, if any, exists).

 

(8)         "SEC
Event" means that, if the First Initial Scheduled Control Account Company Release Event (as defined in Section 32(l)(iii))
is determined by clause (I) of such definition or if clause (y) of the definition of "Control Account Release Eligibility
Date" is determined by clause (I) of such definition, the SEC requires a reduction in the number of Registrable Securities
to be registered for resale on behalf of the Holder and the holders of the Other Notes pursuant to the Initial Registration Statement
or requires that such Holder or holders be named as underwriters therein without such reduction, such that the Initial Registration
Statement declared effective by the SEC fails to register for resale on behalf of the Holder and the holders of the Other Notes
all of the shares of Common Stock issuable upon conversion of this Note and the Other Notes (assuming a conversion in full as of
such time of determination without regard to any restriction or limitation on conversions contained herein or therein and determined
utilizing the Equity Conditions Conversion Price).

 

    - 39 -

     

    

 

(9)         "Second
Maximum Amount" means the Holder Pro Rata Amount of $2,000,000, less all Control Account Release Amounts released
by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the First Scheduled Control Account Company
Release Event.

 

(10)        "Second
Non-SEC Event Amount" means, if no SEC Event occurs, the Holder Pro Rata Amount of $2,000,000, less, all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the First Scheduled
Control Account Company Release Event.

 

(11)        "Second
Release Amount" means a dollar amount equal to the least of (A) the Second SEC Event Amount, if applicable, (B) the
Second Non-SEC Event Amount, if applicable, (C) the Second Maximum Amount and (D) the dollar amount available in the Holder's Master
Restricted Account.

 

(12)        "Second
SEC Event Amount" means, solely if an SEC Event occurs, the Registered Principal Amount of Note less all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the First Scheduled
Control Account Company Release Event.

 

(13)        "Second
Stub Amount" means the difference between the Holder Pro Rata Amount of $2,000,000 and the Second Release Amount.

 

(14)        "Third
Maximum Amount" means the Holder Pro Rata Amount of $1,312,500, less all Control Account Release Amounts released
by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Second Scheduled Control Account Company
Release Event.

 

(15)        "Third
Non-SEC Event Amount" means, if no SEC Event occurs, the Holder Pro Rata Amount of $1,312,500, less, all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Second Scheduled
Control Account Company Release Event.

 

    - 40 -

     

    

 

(16)        "Third
Release Amount" means a dollar amount equal to the least of (A) the Third SEC Event Amount, if applicable, (B) the
Third Non-SEC Event Amount, if applicable, (C) the Third Maximum Amount and (D) the dollar amount available in the Holder's Master
Restricted Account.

 

(17)        "Third
SEC Event Amount" means, solely if an SEC Event occurs, the Registered Principal Amount of Note less all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Second Scheduled
Control Account Company Release Event.

 

(18)        "Third
Stub Amount" means the difference between the Holder Pro Rata Amount of $1,312,500 and the Third Release Amount.

 

(19)        "Fourth
Maximum Amount" means the Holder Pro Rata Amount of $1,312,500, less all Control Account Release Amounts released
by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Third Scheduled Control Account Company
Release Event.

 

(20)        "Fourth
Non-SEC Event Amount" means, if no SEC Event occurs, the Holder Pro Rata Amount of $1,312,500, less, all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Third Scheduled
Control Account Company Release Event.

 

(21)        "Fourth
Release Amount" means a dollar amount equal to the least of (A) the Fourth SEC Event Amount, if applicable, (B) the
Fourth Non-SEC Event Amount, if applicable, (C) the Fourth Maximum Amount and (D) the dollar amount available in the Holder's Master
Restricted Account.

 

(22)        "Fourth
SEC Event Amount" means, solely if an SEC Event occurs, the Registered Principal Amount of Note less all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Third Scheduled
Control Account Company Release Event.

 

(23)        "Fourth
Stub Amount" means the difference between the Holder Pro Rata Amount of $1,312,500 and the Fourth Release Amount.

 

(24)        "Fifth
Maximum Amount" means the Holder Pro Rata Amount of $1,312,500, less all Control Account Release Amounts released
by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Fourth Scheduled Control Account Company
Release Event.

 

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(25)        "Fifth
Non-SEC Event Amount" means, if no SEC Event occurs, the Holder Pro Rata Amount of $1,312,500, less, all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Fourth Scheduled
Control Account Company Release Event.

 

(26)        "Fifth
Release Amount" means a dollar amount equal to the least of (A) the Fifth SEC Event Amount, if applicable, (B) the
Fifth Non-SEC Event Amount, if applicable, (C) the Fifth Maximum Amount and (D) the dollar amount available in the Holder's Master
Restricted Account.

 

(27)        "Fifth
SEC Event Amount" means, solely if an SEC Event occurs, the Registered Principal Amount of Note less all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Fourth Scheduled
Control Account Company Release Event.

 

(28)        "Fifth
Stub Amount" means the difference between the Holder Pro Rata Amount of $1,312,500 and the Fifth Release Amount.

 

(29)        "Sixth
Maximum Amount" means the Holder Pro Rata Amount of $1,312,500, less all Control Account Release Amounts released
by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Fifth Scheduled Control Account Company
Release Event.

 

(30)        "Sixth
Non-SEC Event Amount" means, if no SEC Event occurs, the Holder Pro Rata Amount of $1,312,500, less, all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Fifth Scheduled
Control Account Company Release Event.

 

(31)        "Sixth
Release Amount" means a dollar amount equal to the least of (A) the Sixth SEC Event Amount, if applicable, (B) the
Sixth Non-SEC Event Amount, if applicable, (C) the Sixth Maximum Amount and (D) the dollar amount available in the Holder's Master
Restricted Account.

 

(32)        "Sixth
SEC Event Amount" means, solely if an SEC Event occurs, the Registered Principal Amount of Note less all Control Account
Release Amounts released by the Holder to the Company pursuant to clauses (i) or (ii) of this Section 32(l) since the Fifth Scheduled
Control Account Company Release Event.

 

(33)        "Sixth
Stub Amount" means the difference between the Holder Pro Rata Amount of $1,312,500 and the Sixth Release Amount.

 

    - 42 -

     

    

 

(i)          with
respect to any Restricted Principal designated to be converted in a Conversion Notice, the Company's receipt of both (A) such Conversion
Notice hereunder executed by the Holder in which all, or any part, of the Principal to be converted includes any Restricted Principal
and (B) written confirmation by the Holder that the shares of Common Stock issued pursuant to such Conversion Notice have been
properly delivered in accordance with Section 3(c) (in each case, as adjusted, if applicable, to reflect the withdrawal of any
Conversion Notice, in whole or in part, by the Holder, whether pursuant to Section 3(c)(ii) or otherwise);

 

(ii)         with
respect to any cash amount elected by the Holder, the Company's receipt of a written notice by the Holder electing to effect a
voluntary release of cash with respect to any Restricted Principal to the Company;

 

(iii)        with
respect to the First Release Amount, the twentieth (20th) day after the earlier of (I) the date the Initial Registration
Statement is declared effective by the SEC and (II) the Free Tradability Date (such release of cash, the "First Scheduled
Control Account Company Release Event");

 

(iv)        with
respect to the portion of the First Stub Amount, if any, not exceeding a dollar amount equal to the NASDAQ Principal Amount of
Note, less any amounts previously released by the Holder to the Company pursuant to clause (v) below, the second (2nd)
Business Day immediately following the initial Free Tradability Date occurring after the First Scheduled Control Account Company
Release Event;

 

(v)         with
respect to the portion of the First Stub Amount, if any, not exceeding a dollar amount equal to the Registered Principal Amount
of Note, less any amounts previously released by the Holder to the Company pursuant to clause (iv) above, the second (2nd)
Business Day immediately following the date the Company obtains the Shareholder Approval after the First Scheduled Control Account
Company Release Event;

 

(vi)        with
respect to the Second Release Amount, the ninetieth (90th) day after the earlier of (I) the date the Initial Registration
Statement is declared effective by the SEC and (II) the Free Tradability Date, but in no event before the date that is thirty (30)
days after the date the Company obtains the Shareholder Approval (such release of cash, the "Second Scheduled Control Account
Company Release Event");

 

(vii)       with
respect to the Second Stub Amount, if any, the second (2nd) Business Day immediately following the initial Free Tradability
Date occurring after the Second Scheduled Control Account Company Release Event; and

 

(viii)      with
respect to the Third Release Amount, the one hundred sixtieth (160th) day after the Control Account Release Eligibility
Date (such release of cash, the "Third Scheduled Control Account Company Release Event");

 

(ix)         with
respect to the Third Stub Amount, if any, the second (2nd) Business Day immediately following the initial Free Tradability
Date occurring after the Third Scheduled Control Account Company Release Event;

 

    - 43 -

     

    

 

(x)          with
respect to the Fourth Release Amount, the one hundred ninetieth (190th) day after the Control Account Release Eligibility
Date (such release of cash, the "Fourth Scheduled Control Account Company Release Event");

 

(xi)         with
respect to the Fourth Stub Amount, if any, the second (2nd) Business Day immediately following the initial Free Tradability
Date occurring after the Fourth Scheduled Control Account Company Release Event;

 

(xii)        with
respect to the Fifth Release Amount, the two hundred twentieth (220th) day after the Control Account Release Eligibility
Date (such release of cash, the "Fifth Scheduled Control Account Company Release Event");

 

(xiii)       with
respect to the Fifth Stub Amount, if any, the second (2nd) Business Day immediately following the initial Free Tradability
Date occurring after the Fifth Scheduled Control Account Company Release Event;

 

(xiv)      with
respect to the Sixth Release Amount, the two hundred fiftieth (250th) day after the Control Account Release Eligibility
Date (such release of cash, the "Sixth Scheduled Control Account Company Release Event");

 

(xv)       with
respect to the Sixth Stub Amount, if any, the second (2nd) Business Day immediately following the initial Free Tradability
Date occurring after the Sixth Scheduled Control Account Company Release Event;

 

(xvi)      in
the event a Control Account Company Release Event would have occurred if not for the Additional Cash Release Conditions (as defined
below) and the Company subsequently cures the failure to satisfy such Additional Cash Release Conditions, with respect to the applicable
Control Account Release Amount that should have been released on such Control Account Company Release Event, the (2nd)
Business Day immediately following the delivery by the Company to the Holder of a written notice certifying that all the conditions,
including, without limitation, the Additional Cash Release Conditions, required to be satisfied with respect to such Control Account
Release Event are satisfied and any prior failure to satisfy such conditions has been cured;

 

provided, in the
case of clauses (iii) through (xv) above, that as of such date of determination, (I) no Equity Conditions Failure then exists and
(II) the Permitted Senior Indebtedness is no longer outstanding or the maturity thereof is not on a date that is four (4) months
or less from the applicable Control Account Company Release Event (clauses (I) and (II) together, the "Additional Cash
Release Conditions"); provided, however, that if the number of days between the applicable date of determination
and the Issuance Date is less than the number of days necessary in order to determine if an Equity Conditions Failure has occurred,
such number of days shall be shortened to the number of days between the applicable date of determination and the Issuance Date.

 

(m)          "Control
Account Holder Release Event" means, as applicable,

 

    - 44 -

     

    

 

(i)          with
respect to the entire remaining Restricted Principal as of the applicable date of determination, the date of an Equity Conditions
Failure; provided, however, that if the number of days between the applicable date of determination and the Issuance
Date is less than the number of days necessary in order to determine if an Equity Conditions Failure has occurred, such number
of days shall be shortened to the number of days between the applicable date of determination and the Issuance Date; or

 

(ii)         with
respect to the entire remaining Restricted Principal as of the applicable date of determination, on any date occurring after the
date that is six (6) months from the Issuance Date on which date a Public Information Failure exists or is reasonably expected
to occur.

 

(n)          "Control
Account Release Amount" means, with respect to any given Control Account Company Release Event or Control Account Holder
Release Event, such amount of cash as specified in the applicable clause of the definition of "Control Account Company Release
Event" or "Control Account Holder Release Event", as applicable.

 

(i)          "Common
Stock" means (i) the Company's Class A Common Stock, par value $0.0001 per share and (ii) any share capital
into which such Common Stock shall have been changed or any share capital resulting from a reclassification of such Common Stock.

 

(ii)         "Common
Stock Equivalents" means, collectively, Options and Convertible Securities.

 

(o)          "Company
Conversion Price" means as of any date of determination, that price which shall be the lower of (i) the Conversion Price
then in effect and (ii) the Actual Market Price as of the applicable Installment Date; provided, however, that the
Company Conversion Price shall not be less than the Conversion Floor Price.

 

(p)          "Contingent
Obligation" means, as to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect
to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring
such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will
be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will
be protected (in whole or in part) against loss with respect thereto.

 

(q)          "Conversion
Additional Pre-Installment Floor Amount" means an amount in cash, to be delivered by wire transfer of immediately available
funds pursuant to wire instructions delivered to the Company by the Holder in writing, equal to the product obtained by multiplying
(1) the higher of (I) the highest price that the Common Stock trades at on the Trading Day immediately preceding the relevant Additional
Pre-Installment Conversion Shares Date and (II) the applicable Additional Company Pre-Installment Conversion Price and (2) the
difference obtained by subtracting (I) the number of Additional Pre-Installment Conversion Shares delivered to the Holder on the
applicable Additional Pre-Installment Conversion Shares Date from (II) the quotient obtain by dividing (x) the applicable Accelerated
Amount that the Holder has elected to be the subject of the applicable Company Conversion, by (y) the applicable Additional Company
Pre-Installment Conversion Price without giving effect to the proviso of such definition.

 

    - 45 -

     

    

 

(r)          "Conversion
Balance Floor Amount" means an amount in cash, to be delivered by wire transfer of immediately available funds pursuant
to wire instructions delivered to the Company by the Holder in writing, equal to the product obtained by multiplying (1) the higher
of (I) the highest price that the Common Stock trades at on the Trading Day immediately preceding the relevant Installment Date
and (II) the applicable Company Conversion Price and (2) the difference obtained by subtracting (I) the number of Installment Balance
Conversion Shares delivered to the Holder on the applicable Installment Date from (II) the Installment Balance Floor Conversion
Shares.

 

(s)          "Conversion
Cash Amount" means an amount in cash, to be delivered by wire transfer of immediately available funds pursuant to wire
instructions delivered to the Company by the Holder in writing, equal to the product obtained by multiplying (1) the higher of
(I) the highest price that the Common Stock trades at on the Trading Day immediately preceding the relevant Conversion Date and
(II) the applicable Conversion Price and (2) the difference obtained by subtracting (I) the number of Conversion Shares
delivered to the Holder on the applicable Share Delivery Date related to the applicable Conversion Date from (II) the quotient
obtain by dividing (x) the applicable Conversion Amount that the Holder has elected to be the subject of the applicable Conversion
Notice pursuant to Section 3(c), by (y) the applicable Conversion Price without giving effect to the proviso of such definition.

 

(t)          "Conversion
Floor Price" means $0.25.

 

(u)          "Conversion
Floor Price Condition" means that the relevant Conversion Price, Event of Default Conversion Price, Company Conversion
Price, Initial Company Pre-Installment Conversion Price or Additional Company Pre-Installment Conversion Price, as applicable,
is being determined based on the proviso of such definitions.

 

(v)         "Conversion
Initial Pre-Installment Floor Amount" means an amount in cash, to be delivered by wire transfer of immediately available
funds pursuant to wire instructions delivered to the Company by the Holder in writing, equal to the product obtained by multiplying
(1) the higher of (I) the highest price that the Common Stock trades at on the Trading Day immediately preceding the relevant Initial
Pre-Installment Conversion Shares Date and (II) the applicable Initial Company Pre-Installment Conversion Price and (2) the difference
obtained by subtracting (I) the number of Initial Pre-Installment Conversion Shares delivered to the Holder on the applicable Initial
Pre-Installment Conversion Shares Date from (II) the quotient obtained by dividing (x) the applicable Installment Amount that is
the subject of the applicable Company Conversion, by (y) the applicable Initial Company Pre-Installment Conversion Price without
giving effect to the proviso of such definition.

 

(w)          "Conversion
Shares" means shares of Common Stock issuable by the Company pursuant to the terms of any of the Notes, including, without
limitation, any Principal, Interest and Late Charges so converted, amortized or redeemed.

 

(x)          "Convertible
Securities" means any stock or securities (other than Options) directly or indirectly convertible into or exercisable
or exchangeable for shares of Common Stock.

 

    - 46 -

     

    

 

(y)          "Eligible
Market" means the Principal Market, the NYSE MKT LLC, The NASDAQ Global Market, The NASDAQ Global Select Market, The New
York Stock Exchange, Inc., the OTC Bulletin Board, the OTC QX or the OTC QB.

 

(z)          "Equity
Conditions" means each of the following conditions: (i) either (x) if the event requiring the satisfaction of the
Equity Conditions is a Mandatory Conversion, Company Conversion or Company Optional Redemption, all Registration Statements
filed and required to be filed pursuant to the Registration Rights Agreement shall be effective and available for the resale
of all shares of Common Stock issuable upon conversion of the Conversion Amount that is subject to the applicable Mandatory
Conversion, Company Conversion or Company Optional Redemption (in each case, without regard to any restriction or limitation
on conversions and determined utilizing the Equity Conditions Conversion Price) requiring the satisfaction of the Equity
Conditions or (y) all shares of Common Stock issued and issuable upon exercise of the Warrants (without regard to any
restriction or limitation on exercises) and issued and issuable pursuant to the terms of this Note and the Other Notes,
including the shares of Common Stock issuable upon conversion of the Conversion Amount that is subject to the applicable
Mandatory Conversion, Company Conversion or Company Optional Redemption (without regard to any restriction or limitation on
conversions and determined utilizing the Equity Conditions Conversion Price), requiring the satisfaction of the Equity
Conditions, shall be issuable without any restrictive legend and eligible for sale without restriction pursuant to Rule 144
without any volume limitation by the Holder and no Public Information Failure exists and without the need for registration
under any applicable federal or state securities laws (other than if the Holder becomes an "Affiliate" (as defined
in Rule 144 of the 1933 Act) of the Company after the Issuance Date so long as the Company acknowledges and agrees that the
Holder is not such an Affiliate of the Company merely by virtue of holding the securities of the Company on the Closing Date
subject to a beneficial ownership limitation similar to the beneficial ownership limitation set forth in Section 3(d)(i) set
at 4.99% or 9.99%; (ii) on each day during the Equity Conditions Measuring Period, the Common Stock is designated for
quotation on the Principal Market or any other Eligible Market and shall not have been suspended from trading on such
exchange or market (other than suspensions of not more than two (2) days and occurring prior to the applicable date of
determination due to business announcements by the Company) nor shall delisting or suspension by such exchange or market been
commenced or pending either (A) in writing by such exchange or market or (B) by falling below the then effective
minimum listing maintenance requirements of such exchange or market, which has not been cured, provided, that if the
Company is still within a cure period allowed by the applicable Eligible Market, this Equity Condition shall not be deemed
failed until the lapse of such cure period and the Company's failure to cure such failure; (iii) during the Equity
Conditions Measuring Period, the Company shall have delivered all shares of Common Stock pursuant to the terms of this Note
and the Other Notes and upon exercise of the Warrants to the holders on a timely basis as set forth in Section 3(c) hereof
(and analogous provisions under the Other Notes) and Section 1(a) of the Warrants; (iv) the shares of Common Stock issuable
upon conversion of the Conversion Amount that is subject to the applicable Mandatory Conversion or Company Conversion,
as applicable, requiring the satisfaction of the Equity Conditions may be issued in full without violating Section 3(d)
hereof (and analogous provisions under the Other Notes) (after giving effect to
any action pursuant to Section 8(f)) and the rules or regulations of the Principal Market or any other applicable Eligible
Market; (v) during the Equity Conditions Measuring Period, the Company shall not have failed to timely make any payments
within five (5) Business Days of when such payment is due pursuant to any Transaction Document; (vi) during the Equity
Conditions Measuring Period, there shall not have occurred either (A) the public announcement of a pending, proposed or
intended Fundamental Transaction which has not been abandoned, terminated or consummated, (B) an Event of Default, which has
not been cured during the applicable cure period, if any, set forth in Section 4(a) or waived in writing by the Holder or (C)
an event that with the passage of time or giving of notice would constitute an Event of Default, which has not been cured
during the applicable cure period, if any, set forth in Section 4(a) or waived in writing by the Holder; (vii) the Company
shall have no knowledge of any fact that would cause the Equity Condition set forth in clause (i) to fail; (viii) during the
Equity Conditions Measuring Period, the Company otherwise shall have been in compliance with and shall not have breached, in
any respect that is adverse in any material respect to the Holder, any provision, covenant, representation or warranty of any
Transaction Document; (ix) on each day during the Equity Conditions Measuring Period, the Holder shall not be in possession
of any material, nonpublic information received from the Company, any Subsidiary or its respective agent or Affiliates; (x)
200% of the shares of Common Stock issuable upon conversion of the Conversion Amount that is subject to the applicable
Mandatory Conversion, Company Conversion, Company Optional Redemption or Control Account Release, as applicable, requiring
the satisfaction of the Equity Conditions, as determined utilizing the Equity Conditions Conversion Price, are duly
authorized and reserved for issuances pursuant to the terms hereof and listed and eligible for trading on an Eligible Market;
(xi) to the extent the Shareholder Meeting Deadline has expired as of the applicable date of determination, the Company shall
have obtained the Shareholder Approval on or before the applicable Shareholder Meeting Deadline; (xii) the daily dollar
trading volume of the Common Stock as reported by Bloomberg on every Trading Day during the Equity Conditions Measuring
Period, except on two (2) such Trading Days, shall be at least $100,000; (xiii) on each Trading Day during the Equity
Conditions Measuring Period occurring after the Issuance Date, (A) if the event requiring the satisfaction of the Equity
Conditions is a Mandatory Conversion, the arithmetic average of the Weighted Average Price of the Common Stock equals or
exceeds 300% of the Fixed Conversion Price in effect as of the applicable date of determination (as adjusted for any stock
dividend, stock split, stock combination, reclassification or similar transaction occurring after the Subscription Date), (B)
if the event requiring the satisfaction of the Equity Conditions is a Control Account Release, the Weighted Average Price of
the Common Stock equals or exceeds the greater of (x) $0.25 (as adjusted for any stock dividend, stock split, stock
combination, reclassification or similar transaction occurring after the Subscription Date) and (y) $0.35 and (C) otherwise,
the Weighted Average Price of the Common Stock equals or exceeds $0.25 (as adjusted for any stock dividend, stock split,
stock combination, reclassification or similar transaction occurring after the Subscription Date) and (ix) the Initial
Registration Statement registering any Registrable Securities for resale is not declared effective by the SEC on or prior to
the date that is four (4) months immediately following the Issuance Date.

 

(aa)         "Equity
Conditions Conversion Price" means a Conversion Price equal to the lowest of (w) the then applicable Conversion Price,
(x) the Company Conversion Price, (y) the Initial Company Pre-Installment Conversion Price and (z) the Additional Company Pre-Installment
Conversion Price, in each case, as in effect as of the applicable date of determination.

 

    - 47 -

     

    

 

(bb)         "Equity
Conditions Failure" means that on any day during the period commencing two (2) Trading Days prior to the applicable date
of determination through the applicable date of determination, the Equity Conditions have not each been satisfied (or waived in
writing by the Holder).

 

(cc)         "Equity
Conditions Measuring Period" means each day during the period beginning twenty (20) Trading Days prior to the applicable
date of determination and ending on and including the applicable date of determination.

 

(dd)         "Equity
Interests" means (a) all shares of capital stock (whether denominated as common capital stock or preferred capital stock),
equity interests, beneficial, partnership or membership interests, joint venture interests, participations or other ownership or
profit interests in or equivalents (regardless of how designated) of or in a Person (other than an individual), whether voting
or non-voting and (b) all securities convertible into or exchangeable for any of the foregoing and all warrants, options or other
rights to purchase, subscribe for or otherwise acquire any of the foregoing, whether or not presently convertible, exchangeable
or exercisable.

 

(ee)         "Event
of Default Conversion Price" means, with respect to any Event of Default Conversion, that price which shall be the lowest
of (i) the Conversion Price then in effect, (ii) 70% of the lowest Weighted Average Price of the Common Stock during the twenty
(20) consecutive Trading Day period ending on the Trading Day immediately preceding the date of the applicable Event of Default
Conversion (such Weighted Average Prices to be appropriately adjusted for any share dividend, share split, share combination, reclassification
or similar transaction during such twenty (20) consecutive Trading Day period) and (iii) 70% of the Weighted Average Price of the
Common Stock on the date of the applicable Event of Default Conversion; provided, however, that the Event of Default
Conversion Price shall not be less than the Conversion Floor Price.

 

(ff)         "Event
of Default Conversion Cash Amount" means an amount in cash, to be delivered by wire transfer of immediately available
funds pursuant to wire instructions delivered to the Company by the Holder in writing, equal to the product obtained by multiplying
(1) the higher of (I) the highest price that the Common Stock trades at on the Trading Day immediately preceding the relevant Event
of Default Conversion Date and (II) the applicable Event of Default Conversion Price and (2) the difference obtained by subtracting
(I) the number of Conversion Shares delivered to the Holder on the applicable Share Delivery Date related to the applicable Event
of Default Conversion Date from (II) the quotient obtain by dividing (x) the applicable Event of Default Conversion Amount that
the Holder has elected to be the subject of the applicable Conversion Notice pursuant to Section 7(c), by (y) the applicable Event
of Default Conversion Price without giving effect to the proviso of such definition.

 

    - 48 -

     

    

 

(gg)         "Fundamental
Transaction" means (A) that the Company shall, directly or indirectly, including through Subsidiaries, Affiliates or otherwise,
in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the surviving corporation)
another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties
or assets of the Company or any of its "significant subsidiaries" (as defined in Rule 1-02 of Regulation S-X) to one
or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject to or
have its Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer that
is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares
of Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with
any Subject Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares
of Common Stock such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such
purchase, tender or exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of
at least 50% of the outstanding shares of Common Stock, or (iv) consummate a stock purchase agreement or other business combination
(including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject
Entities whereby all such Subject Entities, individually or in the aggregate, acquire, either (x) at least 50% of the outstanding
shares of Common Stock, (y) at least 50% of the outstanding shares of Common Stock calculated as if any shares of Common Stock
held by all the Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such stock purchase
agreement or other business combination were not outstanding; or (z) such number of shares of Common Stock such that the Subject
Entities become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding
shares of Common Stock, or (v) reorganize, recapitalize or reclassify its Common Stock, (B) that the Company shall, directly
or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions, allow any Subject
Entity individually or the Subject Entities in the aggregate to be or become the "beneficial owner" (as defined in Rule 13d-3
under the 1934 Act), directly or indirectly, whether through acquisition, purchase, assignment, conveyance, tender, tender offer,
exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business combination, reorganization, recapitalization,
spin-off, scheme of arrangement, reorganization, recapitalization or reclassification or otherwise in any manner whatsoever, of
either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock, (y) at least
50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by all such Subject Entities
as of the Subscription Date calculated as if any shares of Common Stock held by all such Subject Entities were not outstanding,
or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding shares of Common Stock or other
equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short form merger or other transaction
requiring other shareholders of the Company to surrender their shares of Common Stock without approval of the shareholders of the
Company or (C) directly or indirectly, including through Subsidiaries, Affiliates or otherwise, in one or more related transactions,
the issuance of or the entering into any other instrument or transaction structured in a manner to circumvent, or that circumvents,
the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than in strict
conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition
which may be defective or inconsistent with the intended treatment of such instrument or transaction. Notwithstanding anything
herein to the contrary, the shares of Common Stock issued in connection with the conversion of the Notes or the exercise of the
Warrants shall be excluded for purposes of determining whether a Fundamental Transaction has occurred.

 

(hh)         "GAAP"
means United States generally accepted accounting principles, consistently applied.

 

    - 49 -

     

    

 

(ii)         "Group"
means a "group" as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.

 

(jj)         "Holder
Pro Rata Amount" means a fraction (i) the numerator of which is the original Principal amount of this Note on the Closing
Date and (ii) the denominator of which is $12,000,000.

 

(kk)         "Indebtedness"
of any Person means, without duplication (i) all indebtedness for borrowed money, (ii) all obligations issued, undertaken or assumed
as the deferred purchase price of property or services, including (without limitation) "capital leases" in accordance
with GAAP (other than trade payables entered into in the ordinary course of business), (iii) all reimbursement or payment obligations
with respect to letters of credit, surety bonds and other similar instruments, (iv) all obligations evidenced by notes, bonds,
debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of property,
assets or businesses, (v) all indebtedness created or arising under any conditional sale or other title retention agreement, or
incurred as financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness (even
though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or
sale of such property), (vi) all monetary obligations under any leasing or similar arrangement which, in connection with GAAP,
consistently applied for the periods covered thereby, is classified as a capital lease, (vii) all indebtedness referred to in clauses
(i) through (vi) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise,
to be secured by) any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by any Person, even though the Person which owns such assets or property has not
assumed or become liable for the payment of such indebtedness, and (viii) all Contingent Obligations in respect of indebtedness
or obligations of others of the kinds referred to in clauses (i) through (vii) above.

 

(ll)         "Initial
Company Pre-Installment Conversion Price" means, with respect to any Company Installment Notice Date or other applicable
date of determination, that price which shall be the lower of (i) the then applicable Conversion Price then in effect and (ii)
the Pre-Delivery Market Price as of the applicable Initial Pre-Installment Conversion Shares Date; provided, however,
that the Initial Company Pre-Installment Conversion Price shall not be less than the Conversion Floor Price.

 

(mm)         "Initial
Registration Statement" shall have the meaning ascribed to such term in the Registration Rights Agreement.

 

(nn)         "Installment
Amount" means with respect to each Installment Date, an amount equal to the sum of the (i) lesser of (A)[●]2
and (B) the Principal outstanding on such Installment Date, (ii) any Deferral Amount deferred pursuant to Section 8(d) and included
in such Installment Amount, (iii) any Accelerated Amount accelerated pursuant to Section 8(e) and included in such Installment
Amount, (iv) accrued and unpaid Interest with respect to such Principal (including, without limitation, any applicable Deferral
Amount(s) and/or Accelerated Amount(s)) and (v) accrued and unpaid Late Charges, if any, with respect to such Principal and Interest,
as any such Installment Amount for each Holder may be reduced pursuant to the terms hereof, whether upon conversion, redemption
or otherwise. In the event the Holder shall sell or otherwise transfer or assign any portion of this Note, the transferee shall
be allocated a pro rata portion of each unpaid Installment Amount hereunder.

 

 

2
Insert 1/32nd of the Holder's Original Principal Amount.

 

    - 50 -

     

    

 

(oo)         "Installment
Balance Conversion Shares" means, for any Installment Date, a number of shares of Common Stock equal to (i) the Post-Installment
Conversion Shares for such date minus (ii) the amount of any Pre-Installment Conversion Shares delivered in respect of the applicable
Installment Date; provided, that in the event that the amount of Pre-Installment Conversion Shares exceeds the Post-Installment
Conversion Shares for such date (such excess, the "Installment Conversion Shares Excess"), the Installment Conversion
Shares Excess shall reduce the number of Pre-Installment Conversion Shares payable on the next Initial Pre-Installment Conversion
Shares Date or Additional Pre-Installment Conversion Shares Date, if any.

 

(pp)         "Installment
Balance Floor Conversion Shares" means, for any Installment Date, a number of shares of Common Stock equal to (i) the
Post-Installment Floor Conversion Shares for such date minus (ii) the amount of any Pre-Installment Floor Conversion Shares that
would have been delivered in respect of the applicable Installment Date if there were no Conversion Floor Price; provided,
that in the event that the amount of Pre-Installment Floor Conversion Shares exceeds the Post-Installment Floor Conversion Shares
for such date, the Installment Balance Floor Conversion Shares shall equal the number of Installment Balance Conversion Shares
delivered to the Holder on the related Installment Date.

 

(qq)         "Installment
Date" means July 29, 2016 and the last Business Day of every calendar month thereafter through and including the
Maturity Date.

 

(rr)         "Interest
Rate" means 8.00% per annum, subject to adjustment as set forth in Section 2.

 

(ss)        "Lead
Investor" means Hudson Bay Master Fund Ltd.

 

(tt)         "Master
Restricted Account" means, solely with respect to the Holder, account number [●] at Bank of Hawaii, or such other
account as may be directed by the Holder, from time to time, subject to the Master Control Account Agreement in favor of the Holder.

 

(uu)       "Material
Adverse Effect" shall have the meaning ascribed to such term in the Securities Purchase Agreement.

 

(vv)       "NASDAQ
Principal Amount of Note" means the principal amount of this Note determined by multiplying the Equity Conditions
Conversion Price in effect as of the applicable date of determination  by the number of shares of Common Stock equal to the
Holder's Exchange Cap Allocation.

 

(ww)      "Options"
means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.

 

    - 51 -

     

    

 

(xx)        "Parent
Entity" of a Person means an entity that, directly or indirectly, controls the applicable Person, including such entity
whose common capital stock or equivalent equity security is quoted or listed on an Eligible Market (or, if so elected by the Required
Holders, any other market, exchange or quotation system), or, if there is more than one such Person or such entity, the Person
or such entity designated by the Required Holders or in the absence of such designation, such Person or entity with the largest
public market capitalization as of the date of consummation of the Fundamental Transaction.

 

(yy)         "Permitted
Indebtedness" means (i) Indebtedness evidenced by this Note and the Other Notes, (ii) trade payables incurred in the ordinary
course of business consistent with past practice, (iii) unsecured Indebtedness incurred
by the Company that is made expressly subordinate in right of payment to the Indebtedness evidenced by this Note, as reflected
in a written agreement acceptable to the Required Holders and approved by the Required Holders in writing, and which Indebtedness
does not provide at any time for (a) the payment, prepayment, repayment, repurchase or defeasance, directly or indirectly, of any
principal or premium, if any, thereon until ninety-one (91) days after the Maturity Date or later and (b) total interest and fees
at a rate in excess of 8.00% per annum, (iv) Indebtedness secured by Permitted Liens described in clauses (iv) of the definition
of Permitted Liens, (v) Permitted Senior Indebtedness and (vi) letters of credit provided to vendors, customers or surety companies
in the ordinary course of business in connection with purchase orders, construction projects or warranty obligations.

 

(zz)         "Permitted
Liens" means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings
for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising in the ordinary course
of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation
of law, such as materialmen's liens, mechanics' liens and other similar liens, arising in the ordinary course of business with
respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings,
(iv) Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries to secure the purchase price
of such equipment or Indebtedness incurred solely for the purpose of financing the acquisition or lease of such equipment, or (B)
existing on such equipment at the time of its acquisition, provided that the Lien is confined solely to the property so acquired
and improvements thereon, and the proceeds of such equipment, (v) Liens incurred in connection with the extension, renewal or refinancing
of the indebtedness secured by Liens of the type described in clause (iv) above, provided that any extension, renewal or replacement
Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the Indebtedness being extended,
renewed or refinanced does not increase, (vi) leases or subleases and licenses and sublicenses granted to others in the ordinary
course of the Company's business, not interfering in any material respect with the business of the Company and its Subsidiaries
taken as a whole, (vii) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of
custom duties in connection with the importation of goods, (viii) Liens arising from judgments, decrees or attachments in circumstances
not constituting an Event of Default under Section 4(a)(ix), (ix) Liens securing Permitted Senior Indebtedness as in effect on
the Subscription Date, (x) Liens as may be consented to from time to time in writing by the Required Holders and (xi) Liens securing
this Note and the Other Notes.

 

    - 52 -

     

    

 

(aaa)        "Permitted
Senior Indebtedness" means Indebtedness incurred pursuant to the Permitted Senior Loan Agreement, as such Indebtedness
may be refinanced, replaced, amended or extended from time to time; provided, however, that such Indebtedness shall
not be amended to become Indebtedness of the Company that is, directly or indirectly, convertible or exercisable into, or exchangeable
for, shares of Common Stock or Common Stock Equivalents.

 

(bbb)        "Permitted
Senior Loan Agreement" means that certain Amended and Restated Loan and Security Agreement dated as of March 30,
2016, by and between the Company, certain of the Company's Subsidiaries and the Permitted Senior Lender, as such may be amended
from time to time and as such Permitted Senior Loan Agreement may be refinanced, replaced, amended or extended from time to time.

 

(ccc)        "Permitted
Senior Lender" means Solar Solutions and Distribution, LLC, any transferee or assignee thereof or any other lender in
any permitted refinancing or replacement of the Permitted Senior Indebtedness.

 

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

 

(eee)        "Post
Installment Conversion Shares" means, for any Installment Date and without taking into account the delivery of any Pre-Installment
Conversion Shares, that number of shares of Common Stock equal to the applicable Company Conversion Amount (including, without
limitation, the addition of any Deferral Amounts and/or Accelerated Amounts to such Company Conversion Amount in accordance with
Section 8(d) and/or Section 8(e), respectively, on such Installment Date) divided by the Company Conversion Price as in effect
on the applicable Installment Date, rounded up to the nearest whole share of Common Stock.

 

(fff)        "Post-Installment
Floor Conversion Shares" means, for any Installment Date and without taking into account the number of Pre-Installment
Floor Conversion Shares, that number of shares of Common Stock equal to the applicable Company Conversion Amount (including, without
limitation, the addition of any Deferral Amounts and/or Accelerated Amounts to such Company Conversion Amount in accordance with
Section 8(d) and/or Section 8(e), respectively, on such Installment Date) divided by the Company Conversion Price but determined
without giving effect to the proviso of such definition, as of the applicable Installment Date, rounded up to the nearest whole
share of Common Stock.

 

(ggg)        "Pre-Delivery
Market Price" means 85% of the five (5) lowest daily Weighted Average Prices of the Common Stock during the twenty (20)
consecutive Trading Day period ending on the Trading Day immediately preceding the applicable date of determination. All such determinations
to be appropriately adjusted for any stock split, stock dividend, stock combination, reclassification or other similar transaction
during such period.

 

    - 53 -

     

    

 

(hhh)        "Pre-Installment
Floor Conversion Shares" means, for any Installment Date, that number of shares of Common Stock equal to the applicable
Company Conversion Amount (including, without limitation, the addition of any Deferral Amounts and/or Accelerated Amounts to such
Company Conversion Amount in accordance with Section 8(d) and/or Section 8(e), respectively, on such Installment Date) divided
by the Initial Company Pre-Installment Conversion Price but determined without giving effect to the proviso of such definition,
as of the applicable Installment Notice Date, rounded up to the nearest whole share of Common Stock.

 

(iii)          "Principal
Market" means The NASDAQ Capital Market.

 

(jjj)          "Public
Information Failure" shall have the meaning ascribed to such term in the Securities Purchase Agreement.

 

(kkk)       "Redemption
Dates" means, collectively, the Event of Default Redemption Dates, the Change of Control Redemption Dates, the Installment
Dates and the Company Optional Redemption Dates, each of the foregoing, individually, a Redemption Date.

 

(lll)         "Redemption
Notices" means, collectively, the Event of Default Redemption Notices, the Change of Control Redemption Notices, the Company
Installment Notices and the Company Optional Redemption Notices, each of the foregoing, individually, a Redemption Notice.

 

(mmm)   "Redemption
Prices" means, collectively, the Event of Default Redemption Price, the Change of Control Redemption Price, the Company
Installment Redemption Price and the Company Optional Redemption Price, each of the foregoing, individually, a Redemption Price.

 

(nnn)     "Registered
Principal Amount of Note" means the principal amount of this Note determined by multiplying the Equity Conditions
Conversion Price in effect as of the applicable date of determination by the number of shares of Common Stock equal to
the Registrable Securities registered for resale by the Holder pursuant to the Initial Registration Statement declared
effective by the SEC.

 

(ooo)     "Registrable
Securities" shall have the meaning ascribed to such term in the Registration Rights Agreement.

 

(ppp)     "Registration
Rights Agreement" means that certain registration rights agreement dated as of the Subscription Date by and among the
Company and the Purchasers relating to, among other things, the registration of the resale of the shares of Common Stock issuable
upon conversion of this Note and the Other Notes and exercise of the Warrants.

 

(qqq)     "Registration
Statement" shall have the meaning ascribed to such term in the Registration Rights Agreement.

 

(rrr)        "Related
Fund" means, with respect to any Person, a fund or account managed by such Person or an Affiliate of such Person.

 

    - 54 -

     

    

 

(sss)        "Required
Holders" means the holders of Notes representing at least fifty-five (55%) of the aggregate Principal amount of the Notes
then outstanding and shall include the Lead Investor so long as the Lead Investor and/or any of its Affiliates collectively hold
at least five percent (5%) of the Notes.

 

(ttt)          "Restricted
Principal" means, as of any given date, the cash amounts held in the Master Restricted Account of the Holder.

 

(uuu)       "Rule
144" means Rule 144 promulgated under the 1933 Act or any successor rule thereto.

 

(vvv)       "SEC"
means the United States Securities and Exchange Commission.

 

(www)     "Securities
Purchase Agreement" means that certain securities purchase agreement dated as of the Subscription Date by and among the
Company and the Purchasers pursuant to which the Company issued the Notes and Warrants.

 

(xxx)         "Shareholder
Approval" shall have the meaning ascribed to such term in the Securities Purchase Agreement.

 

(yyy)       "Shareholder
Meeting Deadline" shall have the meaning ascribed to such term in the Securities Purchase Agreement.

 

(zzz)         "Subject
Entity" means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.

 

(aaaa)      "Subscription
Date" means  April 1, 2016.

 

(bbbb)     "Subsidiary"
shall have the meaning ascribed to such term in the Securities Purchase Agreement.

 

(cccc)      "Successor
Entity" means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity) formed by,
resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder, the
Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.

 

(dddd)     "Trading
Day" means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common
Stock is then traded; provided that "Trading Day" shall not include any day on which the Common Stock is scheduled to
trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time
of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).

 

(eeee)      "Transaction
Document" shall have the meaning ascribed to such term in the Securities Purchase Agreement.

 

    - 55 -

     

    

 

(ffff)      "Warrants"
has the meaning ascribed to such term in the Securities Purchase Agreement, and shall include all warrants issued in exchange therefor
or replacement thereof.

 

(gggg)      "Weighted
Average Price" means, for any security as of any date, the dollar volume-weighted average price for such security on the
Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market publicly
announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported by Bloomberg through its "Volume at Price" function,
or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on
the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time (or such other time
as such market publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time
as such market publicly announces is the official close of trading) as reported by Bloomberg, or, if no dollar volume-weighted
average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest
closing ask price of any of the market makers for such security as reported in the OTC Link or "pink sheets" by OTC Markets
Group Inc. (formerly Pink OTC Markets Inc.). If the Weighted Average Price cannot be calculated for a security on a particular
date on any of the foregoing bases, the Weighted Average Price of such security on such date shall be the fair market value as
mutually determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value
of such security, then such dispute shall be resolved pursuant to Section 26 with the term "Weighted Average Price" being
substituted for the term "Conversion Price". All such determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination, reclassification or other similar transaction during the applicable calculation period.

 

[Signature Page Follows]

 

    - 56 -

     

    

 

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

 

	 	Real Goods Solar, Inc.
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

     

     

    

 

EXHIBIT I

 

REAL
GOODS SOLAR, inc.

 

CONVERSION NOTICE

 

Reference is made to the Senior Secured
Convertible Note (the "Note") issued to the undersigned by Real Goods Solar, Inc., a Colorado corporation (the
"Company"). In accordance with and pursuant to the Note, the undersigned hereby elects to convert the Conversion
Amount (as defined in the Note) of the Note indicated below into shares of Common Stock par value $0.001 per share (the "Common
Stock") of the Company, as of the date specified below. 

	Date of Conversion:	 
	Aggregate Conversion Amount to be converted:	 
	Aggregate accrued and unpaid Interest and accrued and unpaid Late Charges with respect to such portion of the Aggregate Principal and such Aggregate Interest to be converted:	 
	Please confirm the following information:
	Conversion Price:	 
	Please check the following box if the Conversion Price is being determined by:
	Event of Default Conversion Price:    ̈
	Number of shares of Common Stock to be issued:	 
	 ̈          Check here if all or any portion of the aggregate Principal being converted includes any Restricted Principal.  
	Amount of Restricted Principal:	 
	 ̈          Check here if the shares of Common Stock to be issued in connection with this Conversion Notice are being sold contemporaneously herewith by the Holder.
	Please issue the Common Stock into which the Note is being converted in the following name and to the following address:
	Issue to:	 
	 	 
	 	 
	 	 	 	 	 	 

 

     

     

    

 

	Facsimile Number and Electronic Mail:	 
	Authorization:	 
	By:	 
	Title:	 
	Dated:	 
	Account Number:	 
	  (if electronic book entry transfer)	 
	Transaction
    Code Number:	 
	  (if electronic book entry transfer)	 
	Installment Amounts to be reduced and amount of reduction: 	 
	Please issue the Common Stock into which the Note is being converted to Holder, or for its benefit, as follows:
	 ̈          Check here if requesting delivery as a certificate to the following name and to the following address
	Issue to:	 
	 	 
	 	 
	Facsimile Number and Electronic Mail:	 
	 	 
	 ̈          Check here if requesting delivery by Deposit/Withdrawal at Custodian as follows:
	DTC Participant:	 
	DTC Number:	 
	Broker Telephone #:	 
	Account Number:	 
	Transaction Code Number:	 
	 	 	 	 	 	 	 	 	 	 

 

     

     

    

 

ACKNOWLEDGMENT

 

The Company hereby acknowledges
this Conversion Notice and hereby directs Computershare Trust Company, N.A. to issue the above indicated number of shares of Common
Stock in accordance with the Transfer Agent Instructions dated April 1, 2016 from the Company and acknowledged and agreed
to by Computershare Trust Company, N.A.

 

	 	Real Goods Solar, Inc.
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

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