Document:

trtx-ex101_131.htm

 

Exhibit 10.1

AMENDMENT NO. 5 TO MASTER REPURCHASE AND SECURITIES CONTRACT

 

AMENDMENT NO. 5 TO MASTER REPURCHASE AND SECURITIES CONTRACT, dated as of April 18, 2019 (this “Amendment”) by and between TPG RE FINANCE 11, LTD., an exempted company incorporated with limited liability under the laws of the Cayman Islands (“Seller”) and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association (“Buyer”).  Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Repurchase Agreement (as defined below).

RECITALS

WHEREAS, Seller and Buyer are parties to that certain Master Repurchase and Securities Contract, dated as of May 25, 2016 (as amended by that certain Amendment No. 1 to Master Repurchase and Securities Contract, dated as of September 21, 2016, as further amended by that certain Amendment No. 2 to Master Repurchase and Securities Contract, dated as of December 22, 2016, as further amended by that certain Amendment No. 3 to Master Repurchase and Securities Contract, dated as of June 8, 2017, as further amended by that certain Amendment No. 4 to Master Repurchase and Securities Contract, dated as of May 4, 2018, as amended hereby and as further amended, restated, supplemented or otherwise modified and in effect from time to time, the “Repurchase Agreement”); and 

WHEREAS, Seller and Buyer have agreed, subject to the terms and conditions hereof, that the Repurchase Agreement shall be amended as set forth in this Amendment; and TPG RE Finance Trust Holdco, LLC (“Guarantor”) has agreed, subject to the terms and conditions hereof, to make the acknowledgements set forth herein. 

NOW THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows:

SECTION 1.    Repurchase Agreement Amendments.  The Repurchase Agreement is hereby amended as follows:

(a)     Article 2 of the Repurchase Agreement is hereby amended by inserting the following new definitions in correct alphabetical order:

 

“Beneficial Ownership Certification”: A certification regarding beneficial ownership as required by the Beneficial Ownership Regulation in a form as agreed to by Buyer.

 

“Beneficial Ownership Regulation”:  Means 31 C.F.R. § 1010.230.

 

“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).

 

 

 

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

“Fifth Amendment Effective Date”:  April 18, 2019.

“U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

(b)     The defined term “Funding Expiration Date”, as set forth in Article 2 of the Repurchase Agreement, is hereby amended by deleting the date “May 25, 2019” and inserting the date “April 18, 2022” in lieu thereof. 

(c)     The defined term “Maturity Date”, as set forth in Article 2 of the Repurchase Agreement, is hereby amended by deleting the date “May 25, 2019” and inserting the date “April 18, 2022” in lieu thereof.

(d)     Section 3.06 of the Repurchase Agreement is hereby amended by adding the following new clause (vi) to the end of the second sentence thereof immediately preceding the period:

 

“and (vi) if requested by Buyer, Seller shall have delivered to Buyer a new or updated Beneficial Ownership Certification, as applicable, in relation to Seller to the extent that Seller qualifies as a “legal entity customer” under the Beneficial Ownership Regulation”

(e)     Article 7 of the Repurchase Agreement is hereby amended by inserting the following new Section 7.21 in correct numerical order:

 

“Section 7.21Beneficial Ownership Certification.  The information included in each Beneficial Ownership Certification is true and correct in all respects.”

(f)     Article 8 of the Repurchase Agreement is hereby amended by inserting the following new Section 8.17 in correct numerical order:

 

“Section 8.17Beneficial Ownership.  To the extent that Seller is a “legal entity customer” under the Beneficial Ownership Regulation, Seller shall promptly give notice to Buyer of any change in the information provided in any Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified therein and shall promptly deliver an updated Beneficial Ownership Certification to Buyer.”

(g)     Section 18.15(b) of the Repurchase Agreement is hereby amended by inserting the following new clause at the end thereof immediately preceding the period:

 

“, including, but not limited to, any information required to be obtained by Buyer pursuant to the Beneficial Ownership Regulation”.

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(h)     Article 18 of the Repurchase Agreement is hereby amended by inserting the following new Section 18.25 at the end thereof in correct numerical order:

 

“Section 18.25  Recognition of the U.S. Special Resolution Regimes

 

(a) In the event that Buyer becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from Buyer of this Agreement and/or the Repurchase Documents, and any interest and obligation in or under this Agreement and/or the Repurchase Documents, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement and/or the Repurchase Documents, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

 

(b) In the event that Buyer or a BHC Act Affiliate of Buyer becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement and/or the Repurchase Documents that may be exercised against Buyer are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement and/or the Repurchase Documents were governed by the laws of the United States or a state of the United States.”

SECTION 2.     Conditions Precedent.  This Amendment shall become effective on the date hereof provided that (a) this Amendment is duly executed and delivered by each of Seller, Buyer and Guarantor, (b) Seller and Buyer have executed and delivered that certain Amendment No. 6 to Fee and Pricing Letter, dated as of the date hereof, by and between Seller and Buyer, (c) outside counsel to Seller and Guarantor have delivered to Buyer updated copies of each of the legal opinions which were originally delivered to Buyer on May 25, 2016, each in form and substance acceptable to Buyer and its counsel and (d) Buyer shall have received payment from Seller of the respective Structuring Fee and Draw Fee installments that are due on the date hereof.

SECTION 3.     Representations and Warranties.  On and as of the date first above written, Seller hereby represents and warrants to Buyer that (a) it is in compliance with all the terms and provisions set forth in the Repurchase Agreement on its part to be observed or performed, (b) after giving effect to this Amendment, no Default or Event of Default under the Repurchase Agreement has occurred and is continuing, and (c) after giving effect to this Amendment, the representations and warranties contained in Article 9 of the Repurchase Agreement are true and correct in all respects as though made on such date (except for any such representation or warranty that by its terms refers to a specific date other than the date first above written, in which case it shall be true and correct in all respects as of such other date).

SECTION 4.     Acknowledgments of Guarantor.  Guarantor hereby acknowledges the execution and delivery of this Amendment by Seller and Buyer and agrees that it continues to be bound by that certain Amended and Restated Guarantee Agreement, dated as of May 4, 2018 (as may be amended, restated, supplemented or otherwise modified from time to time, the “Guarantee Agreement”), made by Guarantor in favor of Buyer, notwithstanding the execution and delivery of this Amendment and the impact of the changes set forth herein.

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SECTION 5.     Limited Effect.  Except as expressly amended and modified by this Amendment, the Repurchase Agreement and each of the other Repurchase Documents shall continue to be, and shall remain, in full force and effect in accordance with their respective terms; provided, however, that upon the date hereof, (a) all references in the Repurchase Agreement to the “Repurchase Documents” shall be deemed to include, in any event, this Amendment, and (b) each reference to the “Repurchase Agreement” in any of the Repurchase Documents shall be deemed to be a reference to the Repurchase Agreement as amended hereby. 

SECTION 6.     No Novation, Effect of Agreement.  The parties hereto have entered into this Amendment solely to amend the terms of the Repurchase Agreement and do not intend this Amendment or the transactions contemplated hereby to be, and this Amendment and the transactions contemplated hereby shall not be construed to be, a novation of any of the obligations owning by Seller, Guarantor or any of their respective affiliates (the “Repurchase Parties”) under or in connection with the Repurchase Agreement or any of the other Repurchase Documents.  It is the intention of each of the parties hereto that (i) the perfection and priority of all security interests securing the payment of the obligations of the Repurchase Parties under the Repurchase Agreement are preserved and (ii) the liens and security interests granted under the Repurchase Agreement continue in full force and effect.

SECTION 7.     Counterparts.  This Amendment may be executed in counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this Amendment in Portable Document Format (.PDF) or by facsimile transmission shall be effective as delivery of a manually executed original counterpart thereof.

SECTION 8.     Costs and Expenses.  Seller shall pay Buyer’s reasonable actual out of pocket costs and expenses incurred in connection with the preparation, negotiation, execution and consummation of this Amendment in accordance with the Repurchase Agreement.  

SECTION 9.     Submission to Jurisdiction.  Each party irrevocably and unconditionally (i) submits to the non-exclusive jurisdiction of any United States Federal or New York State court sitting in Manhattan, and any appellate court from any such court, solely for the purpose of any suit, action or proceeding brought to enforce its obligations under this Amendment or relating in any way to this Amendment and (ii) waives, to the fullest extent it may effectively do so, any defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and any right of jurisdiction on account of its place of residence or domicile. 

To the extent that either party has or hereafter may acquire any immunity (sovereign or otherwise) from any legal action, suit or proceeding, from jurisdiction of any court or from set off or any legal process (whether service or notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) with respect to itself or any of its property, such party hereby irrevocably waives and agrees not to plead or claim such immunity in respect of any action brought to enforce its obligations under this Amendment or relating in any way to this Amendment.

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The parties hereby irrevocably waive, to the fullest extent each may effectively do so, the defense of an inconvenient forum to the maintenance of such action or proceeding and irrevocably consent to the service of any summons and complaint and any other process by the mailing of copies of such process to them at their respective address specified in the Repurchase Agreement.  The parties hereby agree that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Section 9 shall affect the right of Buyer to serve legal process in any other manner permitted by law or affect the right of Buyer to bring any action or proceeding against Seller or its property in the courts of other jurisdictions.

SECTION 10.     WAIVER OF JURY TRIAL.  EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AMENDMENT.

SECTION 11.     GOVERNING LAW.  THIS AMENDMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS AMENDMENT, THE RELATIONSHIP OF THE PARTIES TO THIS AMENDMENT, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES TO THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CHOICE OF LAW RULES THEREOF.  THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AMENDMENT.  

[Signature Pages to Follow]

 

5

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of the day and year first above written.

 

	
BUYER:

	
 

	
WELLS FARGO BANK, NATIONAL ASSOCIATION,
a national banking association 

	
 

	
By: 
	
 
	
/s/ Allen Lewis

	
Name: 
	
 
	
Allen Lewis

	
Title: 
	
 
	
Managing Director

 

	
SELLER:

	
 

	
TPG RE FINANCE 11, LTD., 
an exempted company incorporated with limited liability under the laws of the Cayman Islands

	
 

	
By: 
	
 
	
/s/ Matthew Coleman

	
Name: 
	
 
	
Matthew Coleman

	
 Title: 
	
 
	
Vice President

 

 

 

[Signature Page to Amendment No. 5 to Master Repurchase and Securities Contract]

 

Acknowledged: 

 

	
TPG RE FINANCE TRUST HOLDCO, LLC, a Delaware limited liability company, in its capacity as Guarantor, and solely for purposes of acknowledging and agreeing to Section 1(h) and Section 4 of this Amendment:

	
 

	
By: 
	
 
	
/s/ Matthew Coleman

	
Name: 
	
 
	
Matthew Coleman

	
Title: 
	
 
	
Vice President

 

 

 

[Signature Page to Amendment No. 5 to Master Repurchase and Securities Contract]Blueprint

  Exhibit 4.1

 

FORM OF SENIOR SECURED CONVERTIBLE NOTE

 

NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE
CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES
MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED 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 TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN
A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS
NOT REQUIRED 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.

 

ENDRA LIFE SCIENCES Inc.

 

Senior Secured Convertible Note

 

	

Issuance
Date: July 26, 2019

	

Principal
Amount: U.S. $_________

 

FOR VALUE RECEIVED, ENDRA Life Sciences
Inc., a Delaware corporation (the “Company”), hereby promises to pay
to the order of ___________ or its registered assigns
(“Holder”) the
amount set out above as the Principal Amount (the
“Principal”)
when due, whether upon the Maturity Date (as defined below),
acceleration, prepayment or otherwise (in each case in accordance
with the terms hereof) and to pay interest (“Interest”) on the outstanding
Principal at the applicable Interest Rate (as defined below) from
the date set out above as the issuance date (the
“Issuance Date”) until the same becomes due
and payable, whether upon the Maturity Date or acceleration,
conversion, prepayment or otherwise (in each case in accordance
with the terms hereof). This Senior Secured Convertible Note
(including all Senior Secured Convertible Notes issued in exchange,
transfer or replacement hereof, this “Note”) is one of an issue of
Senior Secured Convertible Notes issued pursuant to the Securities
Purchase Agreement (as defined below) on the Closing Date (as
defined below) (collectively, the “Notes” and such other Senior
Secured Convertible Notes, the “Other Notes”). Certain capitalized terms
used herein are defined in Section 22.

 

1.      PREPAYMENT. The Company may, at
any time prior to the Maturity Date and upon no less than five
Business Days’ notice to Holder, prepay this Note in full, or
in part.

 

2.      INTEREST RATE; PAYMENT. So long
as no Event of Default shall have occurred and be continuing,
Interest on this Note shall accrue at the applicable Interest Rate
(as defined below). Interest will be paid in arrears on the
outstanding principal amount on the three month anniversary of the
making of this Note and each three month period thereafter and on
the Maturity Date. If an Event of Default shall have occurred and
be continuing, the Interest Rate shall automatically be increased
to eighteen percent (18%) simple interest during the period of such
Event of Default, until such Event of Default is later cured.
Interest due on this Note shall be computed on the basis of a
365-day year.

 

3.     
CONVERSION OF NOTES. The
principal amount of the Note, and any accrued but unpaid Interest,
shall be convertible into validly issued, fully paid and
non-assessable shares of Common Stock (as defined below), on the
terms and conditions set forth in this Section 3.

 

 

 

 

(a)
     Optional Conversion. At any
time after the Issuance Date, the Holder shall be entitled to
convert this Note into that number of shares of Common Stock equal
to the quotient of (A) the Conversion Amount divided by (B) the
Conversion Price.

 

(b)
     Optional Conversion - Event of
Default. Notwithstanding anything in this Note to the
contrary, if a material Event of Default shall have occurred and be
continuing, the Holder shall be entitled to convert this Note into
that number of shares of Common Stock equal to the quotient of (A)
the Conversion Amount divided by (B) the Conversion
Price.

 

(c)
     Mechanics of
Conversion.

 

(i)
          Conversion; Issuance of Shares.
To convert this Note pursuant to Sections 3(a) or 3(b) above into
shares of Common Stock on any date (a “Conversion Date”), the Holder
shall deliver (whether via facsimile or otherwise) a copy of a
properly and fully-completed and executed notice of conversion in
the form attached hereto as Exhibit I (the
“Conversion
Notice”) to the Company. On or before the second
Business Day following the date of receipt of such Conversion
Notice, the Company shall transmit by facsimile or email (by
attachment in PDF format) an acknowledgment of confirmation, in the
form attached hereto as Exhibit II, of receipt of such
Conversion Notice to the Holder and the Company’s transfer
agent (the “Transfer
Agent”). On or before the third Business Day following
the date of receipt of a Conversion Notice but subject to the
surrender for cancellation by the Holder of the original Note (or,
if applicable, a Lost Note Affidavit (defined below)), the Company
shall instruct the Transfer Agent to issue and deliver (via
reputable overnight courier) to the Holder a certificate,
registered in the name of the Holder or its designee, for the
number of shares of Common Stock to which the Holder shall be
entitled, with the legends required by the Securities Purchase
Agreement or applicable law.

 

(ii)
          Registration; Book-Entry. The
Company shall maintain a register (the “Register”) for the recordation of
the names and addresses of the registered holders of each Note and
the principal amount of the Notes held by such holders (the
“Registered
Notes”). The entries in the Register shall be
conclusive and binding for all purposes absent manifest error. The
Company and the holders of the Notes shall treat each Person whose
name is recorded in the Register as the owner of a Note for all
purposes (including, without limitation, the right to receive
payments of Principal and Interest hereunder and the right to
receive shares of Common Stock upon conversion hereof)
notwithstanding notice to the contrary. A Registered Note may be
assigned, transferred or sold in whole or in part only by
registration of such assignment or sale on the Register. Subject to
the satisfaction of applicable law and any restrictions that have
been mutually agreed by the Company and the initial purchaser of
this Note (which shall be binding upon the Holder hereof), upon
receipt by the Company of the registered Holder’s written
request to assign, transfer or sell all or part of any Registered
Note by the holder thereof accompanied by this original Note for
cancellation (or a Lost Note Affidavit, if applicable), the Company
shall record the information contained therein in the Register and
issue one or more new Registered Notes in the same aggregate
principal amount as the unrepaid and unconverted principal amount
of the surrendered Registered Note to the designated assignee or
transferee pursuant to Section 12, provided that if the Company
does not so record an assignment, transfer or sale (as the case may
be) of all or part of any Registered Note within two (2) Business
Days of its receipt of such a proper request, then the Register
shall be automatically updated to reflect such assignment, transfer
or sale (as the case may be).

 

(iii)
         
No Fractional Shares; Transfer
Taxes. The Company shall not issue any fraction of a share
of Common Stock upon any conversion. If the issuance would result
in the issuance of a fraction of a share of Common Stock, the
Company shall round such fraction of a share of Common Stock up to
the nearest whole share. The Company shall pay any and all
transfer, stamp, issuance and similar taxes that may be payable
with respect to the issuance and delivery of Common Stock upon any
conversion.

 

 

-2-

 

 

(d)          
Holder’s Exercise
Limitations. The Company shall not effect any exercise of
this Note, and Holder shall not have the right to exercise any
portion of this Note, pursuant to Section 3 or otherwise, to the
extent that after giving effect to such issuance after exercise,
the Holder (together with the Holder’s Affiliates (as defined
below), and any other 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 exercise of this Note with respect to which such
determination is being made, but shall exclude the number of shares
of Common Stock which would be issuable upon (i) exercise of the
remaining, nonexercised portion of this Note beneficially owned by
the Holder or any of its Affiliates and (ii) exercise or conversion
of the unexercised or nonconverted portion of any other securities
of the Company (including, without limitation, any other common
stock equivalents) subject to a limitation on conversion or
exercise analogous to the limitation contained herein beneficially
owned by the Holder or any of its Affiliates. Except as set forth
in the preceding sentence, for purposes of this Section 1(B),
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 3(d) applies, the determination of whether this Note is
exercisable (in relation to other securities owned by the Holder
together with any Affiliates) and of which portion of this Note is
exercisable shall be in the sole discretion of the Holder, and the
submission of a notice of exercise shall be deemed to be the
Holder’s determination of whether this Note is exercisable
(in relation to other securities owned by the Holder together with
any Affiliates) and of which portion of this Note is exercisable,
in each case subject to the Beneficial Ownership Limitation, 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
3(d), in determining the number of outstanding shares of Common
Stock, Holder may rely on the number of outstanding shares of
Common Stock as reflected in (A) the Company’s most recent
periodic or annual report filed with the SEC, as the case may be,
(B) a more recent public announcement by the Company or (C) a more
recent written notice by the Company or the Company’s
transfer agent setting forth the number of shares of Common Stock
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 exercise of this Note. The Holder, upon not less than 61
days’ prior notice to the Company, may decrease the
Beneficial Ownership Limitation provisions of this Section 3(d).
Any such decrease will not be effective until the 61st day after
such notice is delivered to the Company. The provisions of this
paragraph shall be construed and implemented in a manner otherwise
than in strict conformity with the terms of this Section 3(d) to
correct this paragraph which may be defective or inconsistent with
the intended Beneficial Ownership Limitation herein contained 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.
“Affiliate” means any person that, directly or
indirectly through one or more intermediaries, controls or is
controlled by or is under common control with a person as such
terms are used in and construed under Rule 405 under the Securities
Act.

 

4.   
    RIGHTS UPON EVENT OF
DEFAULT.

 

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

 

(i)       
the Company’s failure to convert this Note in strict
compliance with Section 3, provided that there shall be no Event of
Default during any period of good faith disagreement regarding
whether the Holder has satisfied all requirements to require
conversion of the Note pursuant to Section 3 but only if the
Company has promptly responded to any assertion by the Holder that
the Note has converted into Common Stock pursuant to Section
3;

 

(ii)       
the Company’s failure to pay to the Holder any amount of
Principal, Interest when and as due under this Note or any other
agreement, document, certificate or other instrument delivered in
connection with the transactions contemplated hereby and thereby,
including, but not limited to, any Transaction Document (as defined
in the Securities Purchase Agreement), except, in the case of a
failure to pay Principal or Interest when and as due, in which case
only if such failure remains uncured for a period of at least five
(5) Business Days;

 

(iii)        
the occurrence of any default under, redemption of or acceleration
prior to maturity of any Indebtedness (as defined in the Securities
Purchase Agreement) of the Company, other than with respect to any
Other Notes;

 

(iv)       
bankruptcy, insolvency, reorganization or liquidation proceedings
or other proceedings for the relief of debtors shall be instituted
by or against the Company and, if instituted against the Company by
a third party, shall not be dismissed within sixty (60) days of
their initiation;

 

(v)          
the commencement by the Company of a voluntary case or proceeding
under any applicable federal, state or foreign bankruptcy,
insolvency, reorganization or other similar law or the consent by
it to the entry of a decree, order, judgment or other similar
document in respect of the Company in an involuntary case or
proceeding under any applicable federal, state or foreign
bankruptcy, insolvency, reorganization or other similar law or to
the commencement of any bankruptcy or insolvency case or proceeding
against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable federal,
state or foreign law, or the consent by it to the filing of such
petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or
other similar official of the Company or of any substantial part of
its property, or the making by it of an assignment for the benefit
of creditors, or the execution of a composition of debts, or the
occurrence of any other similar federal, state or foreign
proceeding, or the admission by it in writing of its inability to
pay its debts generally as they become due, the taking of corporate
action by the Company in furtherance of any such
action;

 

 

-3-

 

 

(vi)          
the entry by a court of (i) a decree, order, judgment or other
similar document in respect of the Company of a voluntary or
involuntary case or proceeding under any applicable federal, state
or foreign bankruptcy, insolvency, reorganization or other similar
law; or (ii) a decree, order, judgment or other similar document
adjudging the Company as bankrupt or insolvent, or approving as
properly filed a petition seeking liquidation, reorganization,
arrangement, adjustment or composition of or in respect of the
Company under any applicable federal, state or foreign law; or
(iii) a decree, order, judgment or other similar document
appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any
substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree,
order, judgment or other similar document or any such other decree,
order, judgment or other similar document unstayed and in effect
for a period of sixty (60) consecutive days;

 

(viii)           
a final judgment or judgments for the payment of money aggregating
in excess of $250,000 are rendered against the Company and which
judgments are not, within sixty (60) days after the entry thereof,
bonded, discharged or stayed pending appeal, or are not discharged
within sixty (60) days after the expiration of such
stay;

 

(vii)          
the Company either (i) fails to pay, when due, or within any
applicable grace period, any payment with respect to any
Indebtedness in excess of $250,000 due to any third party (other
than, with respect to unsecured Indebtedness only, payments
contested by the Company in good faith by proper proceedings and
with respect to which adequate reserves have been set aside for the
payment thereof in accordance with GAAP) or is otherwise in breach
or violation of any agreement for monies owed or owing in an amount
in excess of $250,000, which breach or violation permits the other
party thereto to declare a default or otherwise accelerate amounts
due thereunder, or (ii) suffer to exist any other circumstance or
event that would, with or without the passage of time or the giving
of notice, result in a default or event of default under any
agreement binding the Company, which default or event of default
would or would be reasonably expected to have a material adverse
effect on the business, assets, operations (including results
thereof), liabilities, properties, or condition (including
financial condition) of the Company, individually or in the
aggregate (a “Material
Adverse Effect”);

 

(ix)          
other than as specifically set forth in another clause of this
Section 4(a), the Company breaches any representation, warranty,
covenant or other term or condition of any Transaction Document as
defined in the Securities Purchase Agreement under which this Note
is issued, except, in the case of a breach of a covenant or other
term or condition that is curable, only if such breach remains
uncured for a period of three (3) Business Days;

 

(x)          
the occurrence a Material Adverse Effect for a period of more than
five (5) Business Days;

 

(xi)          
the validity or enforceability of any provision of any Transaction
Document (as defined in the Securities Purchase Agreement) shall be
contested by the Company, or a proceeding shall be commenced by the
Company seeking to establish the invalidity or unenforceability
thereof;

 

(xii)          
the Security Documents shall for any reason fail or cease to create
a separate valid and perfected and, except (A) to the extent
permitted by the terms hereof or thereof, first priority Lien on
the Collateral (as defined in the Security Agreement) in favor of
each of the Secured Parties (as defined in the Security Agreement)
or (B) as a result of the act or omission of Holder or the holder
of any Other Note and not materially related to the failure of the
Company to satisfy or tender to satisfy its obligations under the
Security Documents, and such breach remains uncured for a period of
three (3) Business Days after notice from Holder or the holder of
any Other Note of such failure or ceasing;

 

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

 

 

-4-

 

 

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

 

(b)        
Notice of an Event of Default.
Upon the occurrence of an Event of Default with respect to this
Note or any Other Note, the Company shall within two (2) Business
Days deliver written notice thereof via facsimile and overnight
courier (with next day delivery specified) (an “Event of Default Notice”) to the
Holder. At any time after the earlier of the Holder’s receipt
of an Event of Default Notice and the Holder becoming aware of an
Event of Default, the Holder may, by notice to the Company (a
“Holder Default
Notice”), declare this Note to be forthwith due and
payable, whereupon the Principal and all accrued and unpaid
Interest thereon, plus all reasonable costs of enforcement and
collection (including court costs and reasonable attorney’s
fees), shall immediately become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by the Company. This Note
is intended to be entitled, if the Company’s assets are
insufficient to permit payment in full in cash of this Note and all
the Other Notes, to proportional payment along with each of the
Other Notes to the extent payment is demanded by the Holder of this
Note and the holders of any of the Other Notes in accordance with
the Security Documents. In the event that the Company reasonably
believes that it does not have the immediate liquidity to repay in
full in cash this Note and all the Other Notes, the Company may,
for a period of up to fifteen (15) Business Days, delay in payment
of this Note after acceleration in connection with a Holder Default
Notice to attempt to facilitate proper allocation of payments among
the Holder of this Note and the holders of the Other Notes in
accordance with the Security Documents and an opportunity for the
holders of the Other Notes to become aware of the Holder Default
Notice and promptly to exercise their rights under the Other Notes
and the Security Documents. Nothing in this Section 4(b) will
prevent the Holder from pursuing enforcement of its rights under
the Security Documents.

 

5.            
ADJUSTMENT OF CONVERSION
PRICE.

 

(a)
          Adjustment of Conversion Price upon
Subdivision or Combination of Common Stock. If the Company
subdivides (by any stock split, stock dividend, recapitalization or
otherwise) one or more classes of its outstanding shares of Common
Stock into a greater number of shares, the Conversion Price in
effect immediately prior to such subdivision will be
proportionately reduced. If the Company at any time combines (by
combination, reverse stock split or otherwise) one or more classes
of its outstanding shares of Common Stock into a smaller number of
shares, the Conversion Price in effect immediately prior to such
combination will be proportionately increased. Any adjustment
pursuant to this Section 5(a) shall become effective immediately
after the effective date of such subdivision or
combination.

 

(b)          
Other Events. In
the event that the Company shall take any action to which the
provisions of Section 5(a) are not strictly applicable, or, if
applicable, would not operate to protect the Holder from dilution
or if any event occurs of the type contemplated by the provisions
of this Section 5 but not expressly provided for by such
provisions, then the Company’s Board of Directors shall in
good faith determine and implement an appropriate adjustment in the
Conversion Price so as to protect the rights of the Holder,
provided that no such adjustment pursuant to this Section 5(b) will
increase the Conversion Price as otherwise determined pursuant to
this Section 5, provided further that if the Holder does not accept
such adjustments as appropriately protecting its interests
hereunder against such dilution, then the Company’s Board of
Directors and the Holder shall agree, in good faith, upon an
independent investment bank of nationally recognized standing to
make such appropriate adjustments, whose determination shall be
final and binding and whose fees and expenses shall be borne by the
Company.

 

6.          
NONCIRCUMVENTION. The Company
hereby covenants and agrees that the Company will not, by amendment
of its Certificate of Incorporation or Bylaws or through any
reorganization, transfer of assets, consolidation, merger, scheme
of arrangement, dissolution, issue or sale of securities, or any
other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Note, and will at all times
in good faith carry out all of the provisions of this Note and take
all action as may be required to protect the rights of the Holder
of this Note. Without limiting the generality of the foregoing, so
long as any of the Notes remain outstanding, the Company
(i) shall not increase the par value of any shares of Common
Stock receivable upon conversion of this Note above the Conversion
Price then in effect and (ii) shall take all such actions as
may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and non-assessable shares of
Common Stock upon the conversion of this Note, including without
limitation complying with Section 7(b) hereof.

 

 

-5-

 

 

7.          
RESERVATION OF AUTHORIZED
SHARES.

 

(a)
          Reservation. The Company shall
at all times reserve and keep available out of its authorized but
unissued shares Common Stock, solely for the purpose of effecting
the conversion of the Note, no less than 100% of the maximum number
of shares issuable on conversion of the Note (the
“Required Reserve
Amount”).

 

(b)          
Insufficient Authorized
Shares. If, notwithstanding Section 7(a), and not in
limitation thereof, at any time while any of the Notes remain
outstanding the Company does not have a sufficient number of
authorized and unreserved shares of Common Stock to satisfy its
obligation to reserve a number of shares of Common Stock equal to
the Required Reserve Amount (an “Authorized Share Failure”), then
the Company shall immediately take all action within its power
necessary to increase the Company’s authorized shares of
Common Stock to an amount sufficient to allow the Company to
reserve the Required Reserve Amount for the Notes then outstanding,
including without limitation using its best efforts to secure
necessary Board of Directors and stockholder approvals, as further
described below, to appropriately amend the Company’s
Certificate of Incorporation to provide for such increase. Without
limiting the generality of the foregoing sentence, if not earlier
approved by written consent of the stockholders, as soon as
practicable after the date of the occurrence of an Authorized Share
Failure, but in no event later than seventy (70) days after the
occurrence of such Authorized Share Failure, the Company shall hold
a meeting of its stockholders for the approval of an increase in
the number of authorized shares of Common Stock; in connection with
any such meeting, the Company shall provide each stockholders with
a proxy statement and shall use its best efforts to solicit its
stockholders’ approval of such increase in authorized shares
of Common Stock and to cause its Board of Directors to recommend to
the stockholders that they approve such proposal.

 

8.          
COVENANTS. Until
all of the Notes have been converted or otherwise satisfied in
accordance with their terms:

 

(a)
          Rank. This Note shall rank
senior to all other indebtedness of the Company, provided that all
payments due under this Note shall rank pari passu with all Other Notes. The
Company agrees that it will not, without the consent of the
Required Note Holders: (i) grant a consensual lien on any of the
Collateral in connection with any other indebtedness for borrowed
money incurred by the Company; (ii) incur any indebtedness for
borrowed money which is senior in right of repayment to the Notes,
or (iii) give any guarantees for borrowed money of the Company or
of any subsidiary of the Company or in respect of any lease or
other obligation of the Company or of a subsidiary that would be
senior in right of payment of the Notes.

 

9.          

SECURITY. This Note and the
Other Notes are secured to the extent and in the manner set forth
in the Transaction Documents (including, without limitation, the
Security Agreement and the other Security Documents).

 

10.          
AMENDING THE TERMS OF THIS
NOTE. Provisions of this Note may be amended, modified, or a
provision or requirement hereof waived only (a) with the written
consent of the Company and the Holder or, (b) if this Note and each
Other Note then outstanding is similarly amended, modified or
waived, with the written consent of the Company and the Required
Note Holders. If this Note (along with the Other Notes then
outstanding) is amended pursuant to clause (b) of this Section 10,
such amendment shall be binding on the Holder and each holder of
each Other Note whether or not the Holder or such holder of such
Other Note consents thereto.

 

11.          
TRANSFER. This Note
and any shares of Common Stock issued upon conversion of this Note
may be offered, sold, assigned or transferred by the Holder without
the consent of the Company, subject only to the requirements of the
Federal and state securities laws and any other restrictions that
may be mutually agreed by the Company and the Holder
hereof.

 

 

-6-

 

 

12.          
REISSUANCE OF THIS
NOTE.

 

(a)
          Transfer. If this Note is to be
transferred, the Holder shall surrender this Note to the Company,
whereupon the Company will forthwith issue and deliver upon the
order of the Holder a new Note (in accordance with Section 12(d)),
registered as the Holder may request, representing the outstanding
Principal being transferred by the Holder and, if less than the
entire outstanding Principal is being transferred, a new Note (in
accordance with Section 12(d)) to the Holder representing the
outstanding Principal not being transferred.

 

(b)
          Lost, Stolen or Mutilated Note.
Upon receipt by the Company of evidence reasonably satisfactory to
the Company of the loss, theft, destruction or mutilation of this
Note (as to which a written certification and the indemnification
contemplated below (each a “Lost Note Affidavit”) shall
suffice as such evidence), and, in the case of loss, theft or
destruction, of any indemnification undertaking by the Holder to
the Company in customary for, and reasonably acceptable to the
Company, and, in the case of mutilation, upon surrender and
cancellation of this Note, the Company shall execute and deliver to
the Holder a new Note (in accordance with Section 12(d))
representing the outstanding Principal.

 

(c)
          Note Exchangeable for Different
Denominations. This Note is exchangeable, upon the surrender
hereof by the Holder at the principal office of the Company, for a
new Note or Notes (in accordance with Section 12(d) and in
principal amounts of at least $1,000) representing in the aggregate
the outstanding Principal of this Note, and each such new Note will
represent such portion of such outstanding Principal as is
designated by the Holder at the time of such
surrender.

 

(d)
         
Issuance of New Notes. Whenever
the Company is required to issue a new Note pursuant to the terms
of this Note, such new Note (i) shall be of like tenor with this
Note, (ii) shall represent, as indicated on the face of such new
Note, the Principal remaining outstanding (or in the case of a new
Note being issued pursuant to Section 12(a) or Section 12(c), the
Principal designated by the Holder which, when added to the
principal represented by the other new Notes issued in connection
with such issuance, does not exceed the Principal remaining
outstanding under this Note immediately prior to such issuance of
new Notes), (iii) shall have an issuance date, as indicated on the
face of such new Note, which is the same as the Issuance Date of
this Note, (iv) shall have the same rights and conditions as this
Note, and (v) shall represent accrued and unpaid Interest on the
Principal of this Note, from the Issuance Date.

 

13.
          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 incidental or 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 or in the other
Transaction Documents, 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
reasonably requested by the Holder to enable the Holder to confirm
the Company’s compliance with the terms and conditions of
this Note (including, without limitation, compliance with Section
5).

 

14.          
PAYMENT OF COLLECTION,
ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in
the hands of an attorney for collection or enforcement of the debt
evidenced hereby or is collected or enforced through any legal
proceeding or the Holder otherwise takes action to collect amounts
due under this Note or to enforce the provisions of this Note or
(b) there occurs any bankruptcy, reorganization, receivership of
the Company or other proceedings affecting Company creditors’
rights and involving a claim under this Note, then the Company
shall pay the reasonable out-of-pocket costs incurred by the Holder
for such collection, enforcement or action or in connection with
such bankruptcy, reorganization, receivership or other proceeding,
including, without limitation, reasonable attorneys’ fees and
disbursements.

 

 

-7-

 

 

15.          
CONSTRUCTION;
HEADINGS. This Note shall be deemed to be jointly drafted by
the Company and the Holder and shall not be construed against any
Person as the drafter hereof. The headings of this Note are for
convenience of reference and shall not form part of, or affect the
interpretation of, this Note. Terms used in this Note but defined
in the other Transaction Documents shall have the meanings ascribed
to such terms in such other Transaction Documents.

 

16.          
FAILURE OR INDULGENCE NOT
WAIVER. No failure or delay on the part of the Holder in the
exercise of any power, right or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of
any such power, right or privilege preclude other or further
exercise thereof or of any other right, power or privilege. No
waiver shall be effective unless it is in writing and signed by an
authorized representative of the waiving party.

 

17.          
DISPUTE RESOLUTION.
If at any time before conversion of this Note, the Holder and the
Company are unable to agree as to the arithmetic calculation of the
Conversion Price the Holder and the Company will confer in good
faith to resolve such disagreement and the Company shall promptly
issue upon conversion of this Note at the number of shares of
Common Stock that are uncontested. Thereafter, the Company and
Holder will confer in good faith to attempt to reach agreement
regarding the Conversion Price with the Required Note Holders; if
the Required Note Holders and the Company agree in writing upon a
Conversion Price, that agreement will be binding on Holder and all
holders of the Other Notes.

 

18.          
NOTICES;
PAYMENTS.

 

(a)
          Notices. Whenever notice is
required to be given under this Note, unless otherwise provided
herein, such notice shall be given in accordance with Section 13.1
of the Securities Purchase Agreement. The Company shall provide the
Holder with prompt written notice of all actions taken pursuant to
this Note, including in reasonable detail a description of such
action and the reason therefore. Without limiting the generality of
the foregoing, the Company will give written notice to the Holder
(i) promptly, but in any event within ten (10) calendar days, upon
any adjustment of the Conversion Price, setting forth in reasonable
detail, and certifying, the calculation of such adjustment and (ii)
at least fifteen (15) days prior to the date on which the Company
closes its books or takes a record with respect to any dividend or
distribution upon the Common Stock.

 

(b)
          Payments. Whenever any payment
of cash is to be made by the Company to any Person pursuant to this
Note, unless otherwise expressly set forth herein, such payment
shall be made in lawful money of the United States of America by a
check drawn on the account of the Company and sent via overnight
courier service to such Person at such address as previously
provided to the Company in writing (which address, in the case of
each of the Buyers (as defined in the Securities Purchase
Agreement), which shall initially the address set forth on the
Schedule of Buyers attached to the Securities Purchase Agreement),
provided that the Holder may elect to receive a payment of cash via
wire transfer of immediately available funds by providing the
Company with prior written notice setting out such request and the
Holder’s wire transfer instructions. Whenever any amount
expressed to be due by the terms of this Note is due on any day
which is not a Business Day, the same shall instead be due on the
next succeeding day which is a Business Day.

 

19.          
CANCELLATION. After
all Principal, accrued Interest and other amounts at any time owed
on this Note have been paid in full or converted, as the case may
be, this Note shall automatically be deemed canceled and shall not
be reissued.

 

20.          
WAIVER OF NOTICE.
To the extent permitted by law, the Company hereby irrevocably
waives demand, notice, presentment, protest and all other demands
and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note.

 

 

-8-

 

 

21.         
GOVERNING LAW. This Note shall
be construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and
performance of this Note shall be governed by, the internal laws of
the State of New York, without giving effect to any choice of law
or conflict of law provision or rule (whether of the State of New
York or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New York.
The Company hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in The City of
New York, Borough of Manhattan, for the adjudication of any dispute
hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in
an inconvenient forum or that the venue of such suit, action or
proceeding is improper. Nothing contained herein shall be deemed to
limit in any way any right to serve process in any manner permitted
by law. In the event that any provision of this Note is invalid or
unenforceable under any applicable statute or rule of law, then
such provision shall be deemed inoperative to the extent that it
may conflict therewith and shall be deemed modified to conform with
such statute or rule of law. Any such provision which may prove
invalid or unenforceable under any law shall not affect the
validity or enforceability of any other provision of this Note.
Nothing contained herein shall be deemed or operate to preclude the
Holder from bringing suit or taking other legal action against the
Company in any other jurisdiction to collect on the Company’s
obligations to the Holder, to realize on any collateral or any
other security for such obligations, or to enforce a judgment or
other court ruling in favor of the Holder. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO, AND AGREES NOT TO REQUEST,
A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION
CONTEMPLATED HEREBY.

 

22.           
CERTAIN
DEFINITIONS. For purposes of this Note, the following terms
shall have the following meanings:

 

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

 

(b)
          
“Closing Date”
shall have the meaning set forth in the Securities Purchase
Agreement, which date is the date the Company initially issued
Notes pursuant to the terms of the Securities Purchase
Agreement.

 

(c)
         
“Common Stock”
means (i) the Company’s shares of common stock, $0.0001
par value per share, and (ii) any capital stock into which such
common stock shall have been changed or any share capital resulting
from a reclassification of such common stock.

 

(d)
         
“Conversion
Price” shall mean $1.49.

 

(e)
         
“Conversion
Amount” means the outstanding and unpaid Principal
plus any accrued but unpaid Interest thereon.

 

(f)
          
“GAAP” means
United States generally accepted accounting principles,
consistently applied.

 

(g)
         
“Interest Rate” means simple interest at ten
percent (10%) per annum, as may be adjusted from time to time in
accordance with Section 2.

 

(h)
         
“Maturity Date” shall mean April 26,
2020.

 

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

 

(j)
         
“SEC” means the
United States Securities and Exchange Commission or the successor
thereto.

 

 

-9-

 

 

(k)
         
“Securities Purchase
Agreement” means that certain securities purchase
agreement, dated as of the Closing Date, by and among the Company
and the initial holders of the Notes pursuant to which the Company
issued the Notes, as may be amended from time to time.

 

(l)
         
“Security
Agreement” means that certain security agreement,
dated as of the Closing Date, by and among the Company and the
initial holders of the Notes, as may be amended from time to
time.

 

(m)
         
“Security
Documents” has the meaning given to it in the Security
Agreement.

 

23.          
MAXIMUM PAYMENTS.
Nothing contained in this Note shall, or shall be deemed to,
establish or require the payment of a rate of interest or other
charges in excess of the maximum permitted by applicable law. In
the event that the rate of interest required to be paid or other
charges under this Note exceeds the maximum permitted by such law,
any payments in excess of such maximum shall be credited against
amounts owed by the Company to the Holder and thus refunded to the
Company.

 

24.          
SURRENDER OR
ACKNOWLEDGEMENT AND CERTIFICATION: Upon payment in full or
conversion of this Note, Holder shall surrender the original
physical copy of this Note for cancellation; alternatively, if the
Holder promptly requests in connection with such payment or
conversion, the Holder may deliver to the Company a signed
acknowledgement of payment in full and a certification that the
Holder has cancelled or destroyed the Note in a form reasonably
acceptable to the Company.

 

[signature
page follows]

 

 

-10-

 

 

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

 

 

	

ENDRA LIFE SCIENCES INC.

 

 

 

	

By: 

	

Name:
David Wells

	

Title:
Chief Financial Officer

 

 

 

 

 

 

 

 

 

 

 

-11-

 

 

EXHIBIT I

 

 

ENDRA LIFE SCIENCES INC.

 

CONVERSION NOTICE

 

Reference is made
to the Senior Secured Convertible Note (the “Note”) issued to the undersigned
by Endra Life Sciences Inc. (the “Company”). In accordance with and
pursuant to the Note, the undersigned hereby elects to convert the
Conversion Amount (as defined in the Note) of the Note indicated
below into shares of common stock, $0.0001 par value per share (the
“Common Stock”),
of the Company, as of the date specified below.

 

	

Date of
Conversion:

	
 

	

Aggregate
Conversion Amount to be converted:

	
 

	

Conversion
Price:

	
 

	

Number
of shares of Common Stock to be issued:

	
 

	

Please
issue the Common Stock into which the Note is being converted in
the following name and to the following address:

	

Issue
to:

	
 

	
 

	
 

	
 

	
 

	

Facsimile
Number:

	
 

	

Holder:

	
 

	

By:

	
 

	

Title:

	
 

	

Dated:

	
 

 

 

-12-

 

 

EXHIBIT II

 

ACKNOWLEDGMENT

 

The
Company hereby acknowledges this Conversion Notice and hereby
directs _________________ to issue the above indicated number of
shares of Common Stock in accordance with the Transfer Agent
Instructions dated _____________, 20__ from the Company and
acknowledged and agreed to by
________________________.

 

 

	

ENDRA LIFE SCIENCES INC.

 

	

By: 

	

Name:

	

Title:

 

 

 

 

 

 

 

 

 

 

 

-13-

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