Document:

Exhibit

Exhibit 10.1

AMENDMENT NUMBER SIXTEEN TO CREDIT AGREEMENT
THIS AMENDMENT NUMBER SIXTEEN TO CREDIT AGREEMENT (this "Amendment"), dated as of September 8, 2016, is entered into by and among the lenders identified on the signature pages hereof (such Lenders, together with their respective successors and permitted assigns, are referred to hereinafter each individually as a "Lender" and, collectively, as the "Lenders"), WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association ("Wells Fargo"), as administrative agent for each member of the Lender Group and the Bank Product Providers (as such terms are defined in the below referenced Credit Agreement) (in such capacity, together with its successors and assigns in such capacity, "Agent"), ERICKSON INCORPORATED (formerly known as Erickson Air-Crane Incorporated), a Delaware corporation ("EAC"), ERICKSON HELICOPTERS, INC. (formerly known as Evergreen Helicopters, Inc.), an Oregon corporation ("Helicopters") (Helicopters, together with EAC, are referred to hereinafter each individually as a "Borrower", and individually and collectively, jointly and severally, as the "Borrowers"), the Subsidiaries of Borrowers identified on the signature pages hereof (such Subsidiaries are referred to hereinafter each individual as a "Guarantor", and individually and collectively, jointly and severally, as the "Guarantors"), and in light of the following:
WITNESSETH
WHEREAS, Lenders, Agent, Wells Fargo, as lead arranger, book runner, syndication agent, and documentation agent, and Borrowers are parties to that certain Credit Agreement, dated as of May 2, 2013 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement");
WHEREAS, Borrowers have requested that Agent and Lenders make certain amendments to the Credit Agreement;
WHEREAS, upon the terms and conditions set forth herein, Agent and Required Lenders are willing to accommodate Borrowers' requests.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:
1.Defined Terms.  All initially capitalized terms used herein (including the preamble and recitals hereof) without definition shall have the meanings ascribed thereto in the Credit Agreement (including Schedule 1.1 thereto), as amended hereby.

2.Amendments to Credit Agreement.  Subject to the satisfaction (or waiver in writing by Agent) of the conditions precedent set forth in Section 4 hereof, the Credit Agreement is hereby amended as follows:

(a)Clause (c) of Article 7 of the Credit Agreement is hereby amended and restated in its entirety as follows:

(c)    Excess Availability.  Borrowers shall have Excess Availability at all times of at least (i) as of any date of determination during the period from July 25, 2016 through and including August 29, 2016, $10,000,000, (ii) as of any date of determination during the period from August 30, 2016 through and including September 19, 2016, $13,000,000, (iii) as of any date of determination during the period from September 20, 2016 through and including October 2, 2016, $17,500,000, and (iv) as of any date of determination during the period from October 3, 2016 through and including December 31, 2016, $20,000,000. 
(b)Clause (a)(i)(A) of Section 13.1 of the Credit Agreement is hereby amended and restated in its entirety as follows:

(A)    [Reserved.]
(c)Section 13.2 of the Credit Agreement is hereby amended by deleting the following phrase set forth in the third sentence thereof: ", except as expressly required pursuant to Section 13.1,"

(d)Section 15.9 of the Credit Agreement is hereby amended and restated in its entirety as follows:

15.9    Successor Agent.  Agent may resign as Agent upon 30 days (10 days if an Event of Default has occurred and is continuing) prior written notice to the Lenders (unless such notice is waived by the Required Lenders) and without any notice to the Bank Product Providers.  If Agent resigns under this Agreement, the Required Lenders shall be entitled to appoint a successor Agent for the Lenders (and the Bank Product Providers).  If, at the time that Agent’s resignation is effective, it is acting as Issuing Bank or the Swing Lender, such resignation shall also operate to effectuate its resignation as Issuing Bank or the Swing Lender, as applicable, and it shall automatically be relieved of any further obligation to issue Letters of Credit, or to make Swing Loans.  If no successor Agent is appointed prior to the effective date of the resignation of Agent, Agent may appoint, after consulting with the Lenders, a successor Agent.  If Agent has materially breached or failed to perform any material provision of this Agreement or of applicable law, the Required Lenders may agree in writing to remove and replace Agent with a successor Agent from among the Lenders.  In any such event, upon the acceptance of its appointment as successor Agent hereunder, such successor Agent shall succeed to all the rights, powers, and duties of the retiring Agent and the term "Agent" shall mean such successor Agent and the retiring Agent’s appointment, powers, and duties as Agent shall be terminated.  After any retiring Agent’s resignation hereunder as Agent, the provisions of this Section 15 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement.  If no successor Agent has accepted appointment as Agent by the date which is 30 days following a retiring Agent’s notice of resignation, the retiring Agent’s resignation shall nevertheless thereupon become effective and the Lenders shall perform all of the 

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duties of Agent hereunder until such time, if any, as the Lenders appoint a successor Agent as provided for above.
(e)The definition of "Applicable Margin" set forth in Schedule 1.1 to the Credit Agreement is hereby amended and restated in its entirety as follows:

"Applicable Margin" means, as of any date of determination and with respect to Base Rate Loans or LIBOR Rate Loans, as applicable, the applicable margin set forth in the following table:
	
		
	Applicable Margin in respect of Base Rate Loans
	Applicable Margin in respect of LIBOR Rate Loans

	6.50%
	7.50%

(f)Schedule 1.1 to the Credit Agreement is hereby amended by inserting the following new definitions therein in the appropriate alphabetical order:

"Sixteenth Amendment" means that certain Amendment Number Sixteen dated as of September 8, 2016 (and effective as of the Sixteenth Amendment Effective Date) among Agent, the Lenders party thereto, Borrowers, and the Guarantors party thereto.
"Sixteenth Amendment Effective Date" shall have the meaning assigned thereto in the Sixteenth Amendment.
(g)Schedule 5.2 to the Credit Agreement is hereby amended and restated in its entirety in the form of Schedule 5.2 attached hereto.

3.[Reserved.]

4.Conditions Precedent to Amendment.  The satisfaction (or waiver in writing by Agent) of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the "Sixteenth Amendment Effective Date"):

(a)The Sixteenth Amendment Effective Date shall occur on or prior to September 8, 2016.

(b)Agent shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.

(c)Agent shall have received an amendment fee letter, dated as of the date hereof, by and among Agent and Borrowers, in form and substance satisfactory to Agent, duly executed and delivered by the parties thereto.

(d)The representations and warranties herein and in the Credit Agreement and the other Loan Documents as amended hereby shall be true, correct and complete in all material 

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respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true, correct and complete in all material respects as of such earlier date).

(e)No Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.

(f)No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against any Loan Party, Agent, or any Lender.

(g)Borrowers shall pay concurrently with the closing of the transactions evidenced by this Amendment, all fees, costs, expenses and taxes then payable pursuant to the Credit Agreement and Section 6 of this Amendment.

(h)All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance satisfactory to Agent.

5.Representations and Warranties.  Each Loan Party hereby represents and warrants to Agent and the Lenders as follows:

(a)It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified could reasonably be expected to result in a Material Adverse Effect, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into this Amendment and the other Loan Documents to which it is a party and to carry out the transactions contemplated hereby and thereby.

(b)The execution, delivery, and performance by it of this Amendment and the other Loan Documents to which it is a party (i) have been duly authorized by all necessary action on the part of such Loan Party and (ii) do not and will not (A) violate any material provision of federal, state, or local law or regulation applicable to such Loan Party, the Governing Documents of Borrower, or any order, judgment, or decree of any court or other Governmental Authority binding on such Loan Party, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any Material Contract of such Loan Party except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Effect, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any assets of such Loan Party, other than Permitted Liens, (D) require any approval of such Loan Party's interest holders or any approval or consent of any Person under any Material Contract of such Loan Party, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of Material Contracts, for consents or 

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approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Effect, or (E) require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority, other than registrations, consents, approvals, notices, or other actions that have been obtained and that are still in force and effect and except for filings and recordings with respect to the Collateral to be made, or otherwise delivered to Agent for filing or recordation in connection with this Amendment.

(c)This Amendment has been duly executed and delivered by each Loan Party.  This Amendment and each Loan Document to which such Loan Party is a party is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors' rights generally.

(d)No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against any Loan Party, Agent or any Lender.

(e)No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.

(f)The representations and warranties in the Credit Agreement and the other Loan Documents as amended hereby are true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true, correct and complete in all material respects as of such earlier date).

6.Payment of Costs and Fees.  Borrowers agree to pay all out-of-pocket costs and expenses of Agent (including, without limitation, the reasonable fees and disbursements of outside counsel to Agent) in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto.

7.Release.

(a)Each Loan Party hereby acknowledges and agrees that the Obligations under the Credit Agreement and the other Loan Documents are payable pursuant to the Credit Agreement and the other Loan Documents as modified hereby without defense, offset, withholding, counterclaim, or deduction of any kind.

(b)Effective on the date hereof, each Loan Party, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby waives, releases, remises and forever discharges 

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each member of the Lender Group, each Bank Product Provider, and each of their respective Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom any member of the Lenders would be liable if such persons or entities were found to be liable to such Loan Party (each a "Releasee" and collectively, the "Releasees"), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a "Claim" and collectively, the "Claims"), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforeseen, past or present, liquidated or unliquidated, suspected or unsuspected, which such Loan Party ever had from the beginning of the world to the date hereof, or now has, against any such Releasee which relates, directly or indirectly to the Credit Agreement, any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Credit Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in any of the Loan Documents or in this Amendment. As to each and every Claim released hereunder, each Loan Party hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:

"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH A CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM, MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
As to each and every Claim released hereunder, each Loan Party also waives the benefit of each other similar provision of applicable federal or state law (including without limitation the laws of the state of California), if any, pertaining to general releases after having been advised by its legal counsel with respect thereto. 
Each Loan Party each acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such Claims and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Each Loan Party understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release. 
(c)Each Loan Party, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, 

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in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any Claim released, remised and discharged by such Person pursuant to the above release, If any Loan Party or any of its respective successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys' fees and costs incurred by such Releasee as a result of such violation.

8.Choice of Law and Venue; Jury Trial Waiver; Judicial Reference.  THIS AMENDMENT SHALL BE SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 12 OF THE CREDIT AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.

9.Amendments.  This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification is made in accordance with the terms and provisions of  Section 14.1 of the Credit Agreement.

10.Counterpart Execution.  This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of this Amendment by facsimile or other electronic method of transmission shall be equally effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by facsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

11.Effect on Loan Documents.

(a)The Credit Agreement, as amended hereby, and each of the other Loan Documents, as amended as of the date hereof, shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a waiver of, consent to, or a modification or amendment of, any right, power, or remedy of Agent or any Lender under the Credit Agreement or any other Loan Document. Except for the amendments to the Credit Agreement expressly set forth herein, the Credit Agreement and the other Loan Documents shall remain unchanged and in full force and effect.

(b)Upon and after the effectiveness of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "herein", "hereof" or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to "the Credit Agreement", "thereunder", "therein", "thereof' or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement as modified and amended hereby.

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(c)To the extent that any of the terms and conditions in any of the Loan Documents shall contradict or be in conflict with any of the terms or conditions of the Credit Agreement, after giving effect to this Amendment, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Credit Agreement as modified or amended hereby.

(d)This Amendment is a Loan Document.

(e)Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms "includes" and "including" are not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or". The words "hereof', "herein", "hereby", "hereunder", and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). The words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts, and contract rights. Any reference herein to any Person shall be construed to include such Person's successors and assigns.

12.Entire Agreement.  This Amendment, and the terms and provisions hereof, the Credit Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersede any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.

13.Reaffirmation of Obligations.  Each Loan Party hereby reaffirms its obligations under each Loan Document to which it is a party. Each Loan Party hereby further ratifies and reaffirms the validity and enforceability of all of the Liens and security interests heretofore granted, pursuant to and in connection with the Guaranty and Security Agreement, the Aircraft and Engine Security Agreement, or any other Loan Document, to Agent, as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such Liens and security interests, and all collateral heretofore pledged as security for such obligations, continue to be and remain collateral for such obligations from and after the date hereof. Each Loan Party hereby further does grant to Agent, for the benefit of each member of the Lender Group and the Bank Product Providers, a perfected security interest in the Collateral (as defined in the Guaranty and Security Agreement) and the Collateral (as defined in the Aircraft and Engine Security Agreement) in order to secure all of its present and future obligations under the Loan Documents.

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14.Severability.  In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

15.Guarantors.  Each of the undersigned Guarantors consent to the amendments to the Loan Documents contained herein. Although the undersigned Guarantors have been informed of the matters set forth herein and have consented to same, each Guarantor understands that no member of the Lender Group has any obligation to inform it of such matters in the future or to seek its acknowledgement or agreement to future consents, waivers, or amendments related to the Credit Agreement, and nothing herein shall create such a duty.

[signature pages follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered as of the date first above written.
	
	
	ERICKSON INCORPORATED (formerly known as Erickson Air-Crane Incorporated), a Delaware corporation

By: /s/ David Lancelot
Name: David Lancelot
Title: Chief Financial Officer

	
	
	EAC ACQUISITION CORPORATION, a Delaware corporation

By: /s/ David Lancelot
Name: David Lancelot
Title: Chief Financial Officer

	
	
	ERICKSON HELICOPTERS, INC. (formerly known as. Evergreen Helicopters, Inc.), an Oregon corporation

By: /s/ David Lancelot
Name: David Lancelot
Title: Chief Financial Officer

	
	
	ERICKSON TRANSPORT, INC. (formerly known as Evergreen Helicopters of Alaska, Inc.), an Alaska. corporation

By: /s/ David Lancelot
Name: David Lancelot
Title: Chief Financial Officer

	
	
	EVERGREEN HELICOPTERS INTERNATIONAL, INC., a Texas corporation

By: /s/ David Lancelot
Name: David Lancelot
Title: Chief Financial Officer

	
	
	EVERGREEN EQUITY, INC., a Nevada corporation

By: /s/ David Lancelot
Name: David Lancelot
Title: Chief Financial Officer

	
	
	EVERGREEN UNMANNED SYSTEMS, INC., a Delaware corporation

By: /s/ David Lancelot
Name: David Lancelot
Title: Chief Financial Officer

	
	
	WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as Agent, Lead Arranger, Book Runner, Syndication Agent, Documentation Agent, and a Lender

By: /s/ Brandi Whittington
Name: Brandi Whittington
Title: VP, Authorized Signature

	
	
	DEUTSCHE BANK TRUST COMPANY AMERICAS, as a Lender

By: /s/ Frank Fazio
Name: Frank Fazio
Title: Managing Director

	
	
	By: /s/ Stephen R. Lapidus
Name: Stephen R. Lapidus
Title: Director

	
	
	BANK OF THE WEST, as a Lender

By: /s/ Joel Spencer
Name: Joel Spencer
Title: Vice President

	
	
	HSBC BANK USA NA, as a Lender

By: /s/ Eric Dettmer
Name: Eric Dettmer
Title: Vice President

Schedule 5.2
Provide Agent (and if so requested by Agent, with copies for each Lender) with each of the documents set forth below at the following times in form satisfactory to Agent:
	
		
	Weekly until January 4, 2017 (not later than Wednesday of each week) 
	(a) a 13 week cash flow forecast model, in the form provided to Agent on April 27, 2016 and for the forthcoming 13 weeks.

	Monthly (not later than the 25th day of each month); provided that, if, as of any date of determination on or after January 5, 2017, Excess Availability is less than $20,000,000, the reports specified in clauses (a) - (p) shall be delivered on a weekly basis (not later than Wednesday of each week) until such time as Excess Availability shall have been at least $20,000,000 at all times during each of the preceding 30 days
	(b) a report regarding Borrowers’ and their Subsidiaries’ cash and Cash Equivalents, including (i) daily cash collections, (ii) an indication of which amounts constitute Qualified Cash, (iii) account numbers, and (iv) balances for such account numbers,

(c) notice of all claims, offsets, or disputes asserted by Account Debtors with respect to Borrowers’ Accounts,

(d) a Borrowing Base Certificate,

(e) a detailed aging and roll-forward, by total, of Borrowers’ Accounts, together with a reconciliation and supporting documentation for any reconciling items noted (delivered electronically in an acceptable format, if Borrowers have implemented electronic reporting),

(f) a summary aging, by vendor, of the Loan Parties’ accounts payable and any book overdraft (delivered electronically in an acceptable format, if Borrowers have implemented electronic reporting) and an aging, by vendor, of any held checks,

(g) an Account roll-forward, in a format acceptable to Agent in its discretion,  with supporting details supplied from sales journals, collection journals, credit registers and any other records, tied to the beginning and ending account receivable balances of the Loan Parties’ general ledger,

(h) a reconciliation of Accounts, Inventory and trade accounts payable of the Loan Parties’ general ledger to its monthly financial statements including any book reserves related to each category,

(i) a detailed PPO Inventory system/perpetual report (which shall include a list of all PPO Inventory of each Loan Party as of each such day and includes the owner, serial parts, item numbers, item names, location codes, warehouse codes, country code, amount, and any other information reasonably requested by Agent) (delivered electronically in an acceptable format, if the Borrowers have implemented electronic reporting),

(j) a detailed Spare Parts Inventory system/perpetual report (which shall include a list of all Spare Parts by of each Loan Party as of each such day and includes the owner, item numbers and names, country codes, item group codes, status codes, warehouse codes, on hand amount, inventory value, and any other information reasonably requested by Agent) (delivered electronically in an acceptable format, if the Borrowers have implemented electronic reporting),

(k) a detailed work-in-process Inventory system/perpetual report (which shall include

	
		
	 
	material and labor cost, and any other information reasonably requested by Agent (delivered electronically in an acceptable format, if the Borrowers have implemented electronic reporting),

(l) a report showing (i) all deferred revenues as set forth in the Loan Parties’ balance sheet for the prior month, and (ii) the portion of such deferred revenues that will be earned during the next four fiscal quarters,

(m) a detailed description by type and current location of  all of the Inventory, Aircrafts, and Engines, owned by any Loan Party located both in and outside the United States, and for each Aircraft and each Engine that is located outside of the United States an indication of whether the country of its location is a signatory to either (i) the Geneva Convention, or (ii) the Cape Town Convention,

(n) a detailed calculation of Inventory, Aircrafts, and Engines that are not eligible for the Borrowing Base (delivered electronically in an acceptable format, if Borrowers have implemented electronic reporting), 

(o) a detailed report regarding any Inventory (i) with no usage in the immediately preceding seven years, (ii) with more than ten years of usage in the aggregate, or (iii) that has become obsolete due to engineering advances,

(p) a detailed report regarding any write down or obsolete adjustment of any Loan Party’s Inventory, Aircrafts, and Engines,

(q) a 13 week cash flow forecast model, in the form provided to Agent on April 27, 2016 and for the forthcoming 13 weeks, and

(r) a detailed "fleet snapshot" schedule setting forth the utilization of each of the Borrowers' and their Subsidiaries' S-64 Aircrane heavy-lift helicopters and Aircraft helicopters.

	Quarterly (not later than the 45th day after each fiscal quarter)
	(s) a report regarding the Loan Parties’ accrued, but unpaid, ad valorem taxes, and

(t) a Perfection Certificate or a supplement to the Perfection Certificate.

	Semi-annually (not later than February 15th and August 15th of each fiscal year)
	(u) a schedule of the Maintenance Program for each Aircraft and Engine and a report detailing any scheduled long-term maintenance or overhaul for any Aircraft or Engine.

	On each anniversary of the Closing Date if requested by Agent
	(v) an opinion of FAA counsel, in form and substance reasonably satisfactory to Agent, dated as of a date not more than 30 days prior to such anniversary, that, with respect to all Collateral consisting of Aircraft, Engines, and Spare Parts, based on FAA's review of the Aviation Registry of the FAA and the International Registry, Agent has a perfected first priority security interest thereon and International Interest therein, free and clear of all Liens (other than Permitted Liens), and attaching thereto the related "priority search certificates" from the Aviation Registry of the FAA, the International Registry, and the Spare Parts perfection locations.

	
		
	Contemporaneously with the consummation of the applicable sale or other disposition,
	(w) if the aggregate amount of any asset sales or other dispositions (or series of asset sales or dispositions) of Eligible Accounts, Eligible Inventory, or Eligible Aircraft since the date of delivery of the most recently delivered Borrowing Base Certificate pursuant to clause (c) above exceeds $2,500,000, an updated Borrowing Base Certificate excluding such disposed of assets from the Borrowing Base; provided that Borrowers may, in their discretion, update through the date of such sale or disposition all of the other calculations of the Borrowing Base Certificate in accordance with the terms and definitions of the Agreement.  For the avoidance of doubt, nothing contained in this clause (t) shall permit any Borrower or any of its Subsidiaries to sell or otherwise dispose of any assets other than in accordance with Section 6.4 of the Agreement.

	Within 10 days after a request by Agent
	(x) such other reports as to the Collateral or the financial condition of Borrowers and their Subsidiaries, as Agent may reasonably request.

	Promptly, but in any event within 10 days prior to any such action
	(y) written notice that any Aircraft or Engine will be deregistered with the FAA or any Aircraft or Engine will be taken to a country that is not a signatory to the Geneva Convention or the Cape Town Convention, and

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

 

Original
Issue Date: September 1, 2016

Principal
Amount: $157,894.74

 

10%
CONVERTIBLE PROMISSORY NOTE

 

THIS
10% CONVERTIBLE PROMISSORY NOTE is a duly authorized and validly issued convertible note of DirectView Holdings, Inc., a Nevada
corporation, (the “Company”), having its principal place of business at 21218 Saint Andrews Blvd., Suite 323,
Boca Raton, FL, 33433.

 

FOR
VALUE RECEIVED, the Company promises to pay to Old Main Capital, LLC, or its registered assigns (the “Holder”),
or shall have paid pursuant to the terms hereunder, the principal sum of $157,894.74 (the “Principal Amount”),
together with interest at the rate of ten percent (10%) per annum, at maturity or upon acceleration or otherwise, as set forth
herein (the “Note”). The consideration to the Company for this Note is up to $150,000.00 (the “Consideration”),
due to an original issuance discount of 5% (representing $7,894.74 of the Principal Amount) (the “OID”), and
such OID shall be applied in full at the closing of the First Tranche (as defined herein). The Holder shall pay $25,000.00 of
the Consideration to the Company within a reasonable amount of time after the issuance of this Note (the “First Tranche”).
At the closing of the First Tranche, the outstanding principal amount under this Note shall be $32,894.74, which includes the
principal amount of the First Tranche and the OID. The Holder may, in its sole discretion, fund such additional amounts of the
Consideration at any time to the Company. The maturity date for each tranche funded shall be twelve (12) months from the effective
date of each payment (each a “Maturity Date”), and is the date upon which the principal sum of each respective tranche,
as well as any accrued and unpaid interest and other fees relating to that respective tranche, shall be due and payable. This
Note may not be prepaid in whole or in part except as otherwise explicitly set forth herein. THE PRINCIPAL SUM DUE TO THE HOLDER
SHALL BE PRORATED BASED ON THE CONSIDERATION ACTUALLY PAID BY THE HOLDER, AS WELL AS THE APPLICABLE INTEREST, SUCH THAT THE ISSUER
IS ONLY REQUIRED TO REPAY THE AMOUNT FUNDED (PLUS THE OID AND APPLICABLE INTEREST) AND THE ISSSUER IS NOT REQUIRED TO REPAY ANY
UNFUNDED PORTION OF THIS NOTE. This Note is also subject to the following additional provisions:

 

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

 

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

 

“Alternate
Conversion Price” shall mean 55% multiplied by the lowest traded price of the Common Stock for the thirty (30) consecutive
Trading Days ending on the Trading Day that is immediately prior to the applicable Conversion Date.

 

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

 

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

 

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

 

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

 

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

 

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“Common
Stock” shall mean the Company’s common stock.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

“DTC”
means the Depository Trust Company.

 

“DTC/FAST
Program” means the DTC’s Fast Automated Securities Transfer Program.

 

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“DWAC
Eligible” means that (a) the Common Stock is eligible at DTC for full services pursuant to DTC’s Operational Arrangements,
including without limitation transfer through DTC’s DWAC system, (b) the Company has been approved (without revocation)
by the DTC’s underwriting department, (c) the Transfer Agent is approved as an agent in the DTC/FAST Program, (d) the Conversion
Shares are otherwise eligible for delivery via DWAC, and (e) the Transfer Agent does not have a policy prohibiting or limiting
delivery of the Conversion Shares via DWAC.

 

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

 

“Fixed
Conversion Price” shall mean 60% multiplied by the lowest traded price of the Common Stock in the thirty (30) consecutive
Trading Days ending on the Trading Day that is immediately prior to the applicable Conversion Date.

 

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

 

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

 

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

 

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

 

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

 

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

 

“Purchase
Agreement” means the Securities Purchase Agreement, dated as of September 1, 2016, among the Company and the original
Holder, as amended, modified or supplemented from time to time in accordance with its terms.

 

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

 

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

 

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

 

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

 

Section
2. Interest.

 

a) Payment
of Interest in Cash or Kind. The Company shall pay interest to the Holder on the aggregate unconverted and then outstanding
principal amount of this Note at the rate of 10% per annum, which half of the base interest amount shall be guaranteed and the
total amount of interest due on the Note for each tranche funded, for a period of six (6) months, shall be deemed earned as of
the funding date of the respective tranche. All interest payments hereunder will be payable in cash or common stock in the Holder’s
discretion. Accrued and unpaid interest shall be due on payable on each Conversion Date and on the Maturity Date, or as otherwise
set forth herein. Notwithstanding anything to the contrary contained herein, the Company.

 

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

 

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

 

d) Prepayment.
At any time upon ten (10) days written notice to the Holder, and provided the Holder accepts such notice in its sole discretion,
the Company may prepay any portion of the principal amount of this Note and any accrued and unpaid interest. If the Company exercises
its right to prepay the Note, the Company shall make payment to the Holder of an amount in cash equal to the sum of the then outstanding
principal amount of this Note and interest multiplied by 125%. The Holder may continue to convert the Note from the date notice
of the prepayment is given until the date of the prepayment.

 

e) Amortization
and Installment Payments. [Reserved]

 

Section
3. Registration of Transfers and Exchanges.

 

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

 

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

 

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

 

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Section
4. Conversion

 

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

 

b) Conversion
Price. The conversion price in effect on any Conversion Date shall be equal to the Fixed Conversion Price (the “Conversion
Price”). Notwithstanding anything herein to the contrary, at any time after the occurrence of any Event of Default until
this Note is no longer outstanding, the Conversion Price shall be equal to the Alternate Conversion Price. All such determinations
will be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction
that proportionately decreases or increases the Common Stock during such measuring period. Nothing herein shall limit a Holder’s
right to pursue actual damages or declare an Event of Default pursuant to Section 6 hereof and the Holder shall have the right
to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance
and/or injunctive relief. The exercise of any such right shall not prohibit the Holder from seeking to enforce damages pursuant
to any other Section hereof or under applicable law.

 

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c) Mechanics
of Conversion.

 

i. Conversion
Shares Issuable Upon Conversion of Principal Amount. The number of Conversion Shares issuable upon a conversion hereunder
shall be determined by the quotient obtained by dividing (x) the outstanding principal amount of this Note to be converted and
any accrued and unpaid interest to be converted by (y) the conversion price then in effect.

 

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

 

“NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN
A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE
144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”

 

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

 

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

 

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

 

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

 

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vi. Reservation
of Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available out of its
authorized and unissued shares of Common Stock a number of shares of Common Stock at least equal to 300% of the Required Minimum
for the sole purpose of issuance upon conversion of this Note and payment of interest on this Note, each as herein provided, free
from preemptive rights or any other actual contingent purchase rights of Persons other than the Holder (and the other holders
of the Note), not less than such aggregate number of shares of the Common Stock as shall (subject to the terms and conditions
set forth in the Purchase Agreement) be issuable (taking into account the adjustments and restrictions of Section 5) upon the
conversion of the then outstanding principal amount of this Note and payment of interest hereunder. The Company covenants that
all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable,
and, at such times as the Registration Statement covering such shares is then effective under the Securities Act, will be registered
for public resale in accordance with such Registration Statement.

 

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

 

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

 

d)  Holder’s
Conversion Limitations. The Company shall not effect any conversion of principal and/or interest of this Note, and a
Holder shall not have the right to convert any principal and/or interest of this Note, to the extent that after giving effect
to the conversion set forth on the applicable Notice of Conversion, the Holder (together with the Holder’s
Affiliates, and any Persons acting as a group together with the Holder or any of the Holder’s Affiliates) would
beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence,
the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number of shares
of Common Stock issuable upon conversion of this Note with respect to which such determination is being made, but shall
exclude the number of shares of Common Stock which are issuable upon (i) conversion of the remaining, unconverted principal
amount of this Note beneficially owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the
unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion or exercise
analogous to the limitation contained herein (including, without limitation, any other promissory notes or the Warrants)
beneficially owned by the Holder or any of its Affiliates. Except as set forth in the preceding sentence, for purposes of
this Section 4(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the
rules and regulations promulgated thereunder. To the extent that the limitation contained in this Section 4(d) applies, the
determination of whether this Note is convertible (in relation to other securities owned by the Holder together with any
Affiliates) and of which principal amount of this Note is convertible shall be in the sole discretion of the Holder, and the
submission of a Notice of Conversion shall be deemed to be the Holder’s determination of whether this Note may be
converted (in relation to other securities owned by the Holder together with any Affiliates) and which principal amount of
this Note is convertible, in each case subject to the Beneficial Ownership Limitation. To ensure compliance with this
restriction, the Holder will be deemed to represent to the Company each time it delivers a Notice of Conversion that such
Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall have no
obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as
contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. For purposes of this Section 4(e), in determining the number of outstanding shares of Common Stock,
the Holder may rely on the number of outstanding shares of Common Stock as stated in the most recent of the following: (i)
the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (ii) a more recent
public announcement by the Company, or (iii) a more recent written notice by the Company or the Company’s transfer
agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the
Company shall within two Trading Days confirm orally and in writing to the Holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the
conversion or exercise of securities of the Company, including this Note, by the Holder or its Affiliates since the date as
of which such number of outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation”
shall be 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of
shares of Common Stock issuable upon conversion of this Note held by the Holder. The Holder, upon not less than 61
days’ prior notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this
Section 4(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the
Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock

 

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upon
conversion of this Note held by the Holder and the Beneficial Ownership Limitation provisions of this Section 4(e) shall
continue to apply. Any such increase or decrease will not be effective until the 61st day after such notice is delivered to
the Company. The Beneficial Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner
otherwise than in strict conformity with the terms of this Section 4(d) to correct this paragraph (or any portion hereof)
which may be defective or inconsistent with the intended Beneficial Ownership Limitation contained herein or to make changes
or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph
shall apply to a successor holder of this Note.

 

Section
5. Certain Adjustments.

 

a) Stock
Dividends and Stock Splits. If the Company, at any time while this Note is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any Common Stock Equivalents
(which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon conversion of, or payment
of interest on, the Note), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including
by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues, in the event
of a reclassification of shares of the Common Stock, any shares of capital stock of the Company, then the Conversion Price shall
be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding any treasury shares
of the Company) outstanding immediately before such event, and of which the denominator shall be the number of shares of Common
Stock outstanding immediately after such event. Any adjustment made pursuant to this Section shall become effective immediately
after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

b) Subsequent
Equity Sales. If, at any time while this Note is outstanding, the Company or any Subsidiary, as applicable, sells or grants
any option to purchase or sells or grants any right to reprice, or otherwise disposes of or issues (or announces any sale, grant
or any option to purchase or other disposition), any Common Stock or Common Stock Equivalents entitling any Person to acquire
shares of Common Stock at an effective price per share that is lower than the then Conversion Price (such lower price, the “Base
Conversion Price” and such issuances, collectively, a “Dilutive Issuance”) (if the holder
of the Common Stock or Common Stock Equivalents so issued shall at any time, whether by operation of purchase price adjustments,
reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share
which are issued in connection with such issuance, be entitled to receive shares of Common Stock at an effective price per share
that is lower than the then Conversion Price, such issuance shall be deemed to have occurred for less than the then Conversion
Price on such date of the Dilutive Issuance), then the then Conversion Price shall be reduced to equal the Base Conversion Price
(for so long as the Base Conversion Price in effect at that time is lower than the then Conversion Price). Such adjustment shall
be made whenever such Common Stock or Common Stock Equivalents are issued. The Company shall notify the Holder in writing, no
later than the Trading Day following the issuance of any Common Stock or Common Stock Equivalents subject to this Section 5(b),
indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion price and other pricing
terms (such notice, the “Dilutive Issuance Notice”). For purposes of clarification, whether or not the Company provides
a Dilutive Issuance Notice pursuant to this Section 5(b), upon the occurrence of any Dilutive Issuance, the Holder is entitled
to receive a number of Conversion Shares based upon the Base Conversion Price on or after the date of such Dilutive Issuance,
regardless of whether the Holder accurately refers to the Base Conversion Price in the Notice of Conversion.

 

    	 	11	 

    	 		 

    

 

c) Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 5(a) above, if at any time the Company grants, issues
or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record
holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to
acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired
if the Holder had held the number of shares of Common Stock acquirable upon complete conversion of this Note (without regard to
any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the
date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date
as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights
(provided, however, to the extent that the Holder’s right to participate in any such Purchase Right would result in the
Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right
to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and
such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would
not result in the Holder exceeding the Beneficial Ownership Limitation).

 

d)
Intentionally Omitted.

 

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

 

    	 	12	 

    	 		 

    

 

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

 

g) Notice
to the Holder.

 

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

 

ii. Notice
to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form)
on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for
or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company
shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the
Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share
exchange whereby the Common Stock is converted into other securities, cash or property or (E) the Company shall authorize the
voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the
Company shall cause to be filed at each office or agency maintained for the purpose of conversion of this Note, and shall
cause to be delivered to the Holder at its last address as it shall appear upon the Note Register, at least twenty (20)
calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which
a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not
to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger,
sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected
that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities,
cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange,
provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the
validity of the corporate action required to be specified in such notice. To the extent that any notice provided
hereunder constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the
Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall
remain entitled to convert this Note during the 20-day period commencing on the date of such notice through the effective
date of the event triggering such notice except as may otherwise be expressly set forth herein.

 

    	 	13	 

    	 		 

    

 

Section
6. Events of Default.

 

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

 

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

 

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

 

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

 

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

 

    	 	14	 

    	 		 

    

 

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

 

vi. the
Company or any Subsidiary shall default on any of its obligations under any mortgage, credit agreement or other facility, indenture
agreement, factoring agreement or other instrument under which there may be issued, or by which there may be secured or evidenced,
any indebtedness for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves an obligation
greater than $150,000, whether such indebtedness now exists or shall hereafter be created, and (b) results in such indebtedness
becoming or being declared due and payable prior to the date on which it would otherwise become due and payable;

 

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

 

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

 

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

 

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

 

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

 

    	 	15	 

    	 		 

    

 

(vi)
take or permit to be taken any action in furtherance of or for the purpose of effecting any of the foregoing;

 

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

 

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

 

xiv. the
Company shall fail to maintain sufficient reserved shares pursuant to Section 4.10 of the Purchase Agreement;

 

xv. any
monetary judgment, writ or similar final process shall be entered or filed against the Company, any subsidiary or any of their
respective property or other assets for more than $150,000, and such judgment, writ or similar final process shall remain unvacated,
unbonded or unstayed for a period of 45 calendar days;

 

xvi. a
breach or default by the Company of any covenant or other term or condition contained in any of the other financial instrument
currently issued or hereafter issued by the Company, including but not limited to promissory notes (the “Other Agreements”),
after the passage of all applicable notice and cure or grace periods, shall, at the option of the Holder, be considered a default
under this Note, in which event the Holder shall be entitled (but in no event required) to apply all rights and remedies of the
Holder under the terms of this Note by reason of a default under said Other Agreement;

 

xvii. there
is no bid for the Common Stock on the principal trading market;

 

xviii. The
aggregate dollar trading volume of the Company’s Common Stock is less than $50,000.00 in any 7 calendar day period or the
Company’s market capitalization is less than $500,000.00 at any time while this Note is outstanding; or

 

xix. any
attempt by the Company or its officers, directors, and/or affiliates to transmit, convey, disclose, or any actual transmittal,
conveyance, or disclosure by the Company or its officers, directors, and/or affiliates of, material non-public information concerning
the Company, to the Holder or its successors and assigns, which is not immediately cured by Company’s filing of a Form 8-K
pursuant to Regulation FD on that same date.

 

    	 	16	 

    	 		 

    

 

 

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

 

Section
7. Miscellaneous.

 

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

 

    	 	17	 

    	 		 

    

 

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

 

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

 

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

 

    	 	18	 

    	 		 

    

 

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

 

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

 

g) Remedies,
Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Note shall be cumulative
and in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity
(including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder’s
right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Note. The Company
covenants to the Holder that there shall be no characterization concerning this instrument other than as expressly provided herein.
Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall
be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation
of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees
that, in the event of any such breach or threatened breach, the Holder shall be entitled, in addition to all other available remedies,
to an injunction restraining any such breach or any such threatened breach, without the necessity of showing economic loss and
without any bond or other security being required. The Company shall provide all information and documentation to the Holder that
is requested by the Holder to enable the Holder to confirm the Company’s compliance with the terms and conditions of this
Note.

 

    	 	19	 

    	 		 

    

 

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

 

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

 

j) Section
3(a)(9) and 3(a)(10) Transactions. The express written consent of the Holder must be obtained by the Company, if at any time
while this Note is outstanding, the Company seeks to enter into a transaction structured in accordance with, based upon, or related
or pursuant to, in whole or in part, Section 3(a)(9) or 3(a)(10) of the Securities Act.

 

Section
8. Participation in Future Financing.

 

 a)Subject
to any existing obligations of the Company, from the date hereof until the date that is the 12-month anniversary of the date
of this Note, upon any issuance by the Company or any of its Subsidiaries of Common Stock, Common Stock Equivalents or
debt for cash consideration, indebtedness or a combination of units hereof, other than any issuance that is through a public
underwritten offering or to an investor or a group of investors that already own Common Stock or Common Stock Equivalents (a
“Subsequent Financing”), each Holder shall have the right to participate in the Subsequent Financing in an
amount up to 100% of such Holder’s Pro Rata Portion (as defined below) (the “Participation
Maximum”) on the same terms, conditions and price provided for in the Subsequent Financing, subject to any existing
obligations of the Company with respect to participation rights.

 

 b)At
least five (5) Trading Days prior to the closing of the Subsequent

Financing, the Company shall deliver to each Holder a written notice of its intention to

effect a Subsequent Financing (“Pre-Notice”), which Pre-Notice shall ask such Holder if it wants to review
the details of such financing (such additional notice, a “Subsequent Financing Notice”. Upon the request of
a Holder within two (2) Trading Days after the Pre-Notice, and only upon a request by such Holder, for a Subsequent Financing
Notice, the Company shall promptly, but no later than one (1) Trading Day after such request, deliver a Subsequent Financing Notice
to such Holder. The Subsequent Financing Notice shall describe in reasonable detail the proposed terms of such Subsequent Financing,
the amount of proceeds intended to be raised thereunder and the Person or Persons through or with whom such Subsequent Financing
is proposed to be effected and shall include a term sheet or similar document relating thereto as an attachment.

 

 c)Any
Holder desiring to participate in such Subsequent Financing must provide written notice to the Company no later than two (2)
Trading Days after delivery of such Subsequent Financing Notice that such Holder is willing to participate in the Subsequent
Financing, the amount of such Holder’s participation, and representing and warranting that such Holder has such funds
ready, willing, and available for investment on the terms set forth in the Subsequent Financing Notice.

 

 d)If
notifications by the Holders of their willingness to participate in the Subsequent Financing (or to cause their designees to
participate) is, in the aggregate, less than the total amount of the Subsequent Financing, then the Company may effect the
remaining portion of such Subsequent Financing on the terms and with the Persons set forth in the Subsequent Financing
Notice.

 

    	 	20	 

    	 		 

    

 

 e)If
the Company receives responses to a Subsequent Financing Notice from Holders seeking to purchase more than the aggregate
amount of the Participation Maximum, each such Holder shall have the right to purchase its Pro Rata Portion of the
Participation Maximum. “Pro Rata Portion” means the ratio of (x) the amount of Notes held by a Holder
participating under this Section 8 and (y) the sum of the aggregate amounts of Notes held by all Holders participating under
this Section 8.

 

 f)The
Company must provide the Holders with a second Subsequent Financing Notice, and the Holders will again have the right of
participation set forth above in this Section 8, if the Subsequent Financing subject to the initial
Subsequent Financing Notice is not consummated for any reason on the terms set forth in such Subsequent Financing
Notice within thirty (30) Trading Days after the date of the initial Subsequent Financing Notice.

 

 g)The
Company and each Holder agree that if any Holder elects to participate in the Subsequent Financing, the transaction documents
related to the Subsequent Financing shall not include any term or provision whereby such Holder shall be required to
agree to any restrictions on trading as to any of the Securities purchased hereunder or be required to consent to any
amendment to or termination of, or grant any waiver, release or the like under or in connection with, this Note, without the
prior written consent of such Holder.

 

 h)Notwithstanding
anything to the contrary in this Section 8 and unless otherwise agreed to by such Holder, the Company shall either confirm in
writing to such Holder that the transaction with respect to the Subsequent Financing has been abandoned or shall publicly
disclose its intention to issue the securities in the Subsequent Financing, in either case in such a manner such that such
Holder will not be in possession of any material, non-public information, by the tenth (10th) Business Day following delivery
of the Subsequent Financing Notice. If by such tenth (10th) Business Day, no public disclosure regarding a transaction with
respect to the Subsequent Financing has been made, and no notice regarding the abandonment of such transaction has been
received by such Holder, such transaction shall be deemed to have been abandoned and such Holder shall not be deemed to be in
possession of any material, non-public information with respect to the Company or any of its Subsidiaries.

 

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

 

(Signature
Pages Follow)

 

    	 	21	 

    	 		 

    

 

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

 

	 	DIRECTVIEW
    HOLDINGS, INC.
	 	 	 
	 	By:	/s/
    Roger Ralston
	 	Name:	Roger
    Ralston
	 	Title:	Chief
    Executive Officer

 

    	 	22	 

    	 		 

    

 ANNEX
A

 

 NOTICE
OF CONVERSION

 

The
undersigned hereby elects to convert principal under the 10% convertible promissory note due September 1, 2016 of DirectView Holdings,
Inc., a Nevada corporation (the “Company”), into shares of common stock (the “Common Stock”),
of the Company according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in
the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and
is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will
be charged to the holder for any conversion, except for such transfer taxes, if any.

 

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

 

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

 

	Conversion
    calculations:	 
	 	Date
    to Effect Conversion:
	 	 
	 	Principal
    Amount of Note to be Converted:
	 	 
	 	Payment
    of Interest in Common Stock __ yes __ no
	 	If
    yes, $_____ of Interest Accrued on Account of Conversion at Issue.
	 	 
	 	Number
    of shares of Common Stock to be issued:
	 	 
	 	Signature:
	 	 
	 	Name:
	 	 
	 	Delivery
    Instructions:

 

    	 	23	 

    	 		 

    

 

Schedule
1

 

 CONVERSION
SCHEDULE

 

This
10% convertible promissory note due on September 1, 2016 in the original principal amount of $157,894.74 is issued by DirectView
Holdings, Inc., a Nevada Corporation. This Conversion Schedule reflects conversions made under Section 4 of the above referenced
Note.

 

Dated:

 

	 Date
of Conversion

        (or
        for first entry, Original Issue Date)
	 	 Amount
of

                                                                     Conversion
	 	Aggregate
Principal Amount Remaining Subsequent to Conversion

        (or
        original Principal Amount)
	 	 Company
Attest

	 

         

         
	 	 

         
	 	 

         
	 	 

         

 

    	 	24

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