Document:

bcei_Ex_10-5

		
			Exhibit 10.5
		

		
			RESTRICTED STOCK AGREEMENT 
		

		
			THIS RESTRICTED STOCK AGREEMENT (this “Agreement”), is entered into as of the Grant Date (as defined below), by and between Grantee (as defined below) and Bonanza Creek Energy, Inc., a Delaware corporation (the “Company”).
		

		
			WHEREAS, the Company maintains the Bonanza Creek Energy, Inc. 2011 Long Term Incentive Plan, as such may be amended or modified from time to time (the “Plan”), which is incorporated into and forms a part of this Agreement, and Grantee has been selected by the board of directors of the Company (the “Board”) or the compensation committee of the Board (the “Committee”) to receive a Restricted Stock Award (the “Award”) under the Plan as set forth in this Agreement;
		

		
			NOW, THEREFORE, IT IS AGREED, by and between the Company and Grantee, as follows:
		

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

			
	
			
				 (a)
			“Cause” shall mean any of the following: (i) Grantee has failed or refused to substantially perform Grantee’s Board duties, responsibilities, or authorities (other than any such refusal or failure resulting from Grantee’s becoming Disabled); (ii) any commission by or indictment of Grantee of a felony or other crime of moral turpitude; (iii) Grantee has engaged in material misconduct in the course and scope of Grantee’s Board Service with the Company, including, but not limited to, gross incompetence, disloyalty, disorderly conduct, harassment of employees or third parties, chronic abuse of alcohol or unprescribed controlled substances, improper disclosure of confidential information, chronic and unexcused failure to attend Board or committee meetings, improper appropriation of a corporate opportunity or any other material violation of the Company’s rules or codes of conduct or any fiduciary duty owed to the Company or its Affiliates, or any applicable law or regulation to which the Company or its Affiliates are subject; (iv) Grantee has committed any act of fraud, embezzlement, theft, dishonesty, misrepresentation or falsification of records; or (v) Grantee has engaged in any act or omission that is likely to materially damage the Company’s business, including, without limitation, damages to the Company’s reputation.

			
	
			
				 (b)
			“Covered Shares” means shares of the Company’s Common Stock granted under this Agreement and subject to the terms of this Agreement and the Plan.  The number of “Covered Shares” granted to you under this Agreement is the number of shares of the Company’s Common Stock specified in correspondence that you received from the Company on or about [Date].

			
	
			
				 (c)
			“Date of Termination” means the date on which Grantee’s Service with the Company or an Affiliate terminates for any reason.

		

		

		 

		

			1

		

 

		
		

			
	
			
				 (d)
			“Designated Beneficiary” means the beneficiary or beneficiaries designated by Grantee in a writing filed with the Company in the form attached hereto as Exhibit A.

			
	
			
				 (e)
			“Disabled” as it relates to Grantee shall mean when (i) Grantee receives disability benefits under social security, or (ii) the Company, upon the written report of a qualified physician designated by the Company’s insurers, shall have determined (after a complete physical examination of Grantee at any time after Grantee has been absent from the Board for 90 or more consecutive calendar days) that Grantee has become physically and/or mentally incapable of performing Grantee’s Board duties with or without reasonable accommodation due to injury, illness, or other incapacity (physical or mental).

			
	
			
				 (f)
			“Grantee” means you, director of the Company specified in correspondence that you received from the Company on or about [Date].

			
	
			
				 (g)
			“Grant Date” means [Date].

			
	
			
				 (h)
			“Installment” means a portion of Covered Shares.

		
			Capitalized terms used herein without definition have the meanings ascribed to such terms in the Plan.  Except where the context clearly implies or indicates the contrary, a word, term, or phrase used in the Plan is similarly used in this Agreement.
		

			
	
			
				 2.
			Award.  Grantee is hereby granted the number of Covered Shares specified in the correspondence Grantee received from the Company on or about the Grant Date.

			
	
			
				 3.
			Delivery of Covered Shares.  Covered Shares shall be registered in book entry form with the Company’s transfer agent.    During the applicable Restricted Period, Covered Shares may carry the following legend or any other legend the Board or the Committee (if so authorized) deems applicable:

		
			“TheSE securities are subject to the VESTING RESTRICTIONS and other provisions of the Bonanza creek Energy, Inc. 2011 Long Term IncentivE Plan, AS SUCH PLAN MAy be amended or modified, AND THE Restricted Stock Agreement between Bonanza Creek Energy, Inc. and THE HOLDER OF THESE SECURITIES.”
		

			
	
			
				 4.
			Restricted Period.  The “Restricted Period” for each Installment of Covered Shares shall begin on the Grant Date and end on the date scheduled below applicable to such Installment: 

			
					
						INSTALLMENT

					
					
						  

					
					
						  

					
					
						RESTRICTED PERIOD WILL END ON:

				
	
					
						All of the Covered Shares

					
					
						 

					
					
						 

					
					
						The day prior to the Company’s [Year] Annual Meeting of Stockholders

				

		
			 
		

		
			Covered Shares may not be sold, assigned, transferred, pledged or otherwise encumbered prior to the expiration of the Restricted Period applicable to such Installment of Covered Shares.
		

		

		

		 

		

			2

		

 

		
		

			
	
			
				 5.
			Transfer and Forfeiture of Shares.  Except as set forth below, Grantee shall forfeit any Installment of Covered Shares for which the Restricted Period has not expired as of a Date of Termination.    If a Date of Termination does not occur during a Restricted Period with respect to an Installment of the Covered Shares, then, at the end of the Restricted Period that is applicable for such Installment, Grantee shall become vested in those Covered Shares, and such Installment shall be transferred to Grantee free of all restrictions otherwise imposed by this Agreement.

		
			Notwithstanding the foregoing, all Installments of Covered Shares shall become immediately vested, and such Installment shall be transferred to Grantee free of all restrictions otherwise imposed by this Agreement, upon:
		

			
	
			
				 (i)
			the termination of Grantee’s Service on the Board as a result of not being nominated for reelection by the Board;

			
	
			
				 (ii)
			the termination of Grantee’s Service on the Board because Grantee, although nominated for reelection by the Board, is not reelected by the Company’s stockholders;

			
	
			
				 (iii)
			the termination of Grantee’s Service on the Board because of (i) Grantee’s resignation at the request of the Nominating and Corporate Governance Committee of the Board (or any successor committee), or (ii) Grantee’s removal by action of the stockholders or by the Board, in each case other than for Cause; 

			
	
			
				 (iv)
			the termination of Grantee’s Service on the Board because of death or because Grantee becomes Disabled; or

			
	
			
				 (v)
			the occurrence of a Change in Control.

			
	
			
				 6.
			Withholding.  Grantee hereby acknowledges that there is no current statutory withholding obligation in respect of remuneration received in regards to Service as a non-employee member of the Board, and that accordingly, Grantee will not be permitted to tender Stock or surrender Covered Shares to the Company in order to satisfy any tax consequences, and instead will need to make arrangements separate from the Company for purposes of satisfying any and all taxes that may be due as a result of the grant or vesting of the Covered Shares.  In the event that the grant and vesting of shares of Stock under this Agreement become subject to withholding, then Grantee shall be required to make arrangements satisfactory to the Company to satisfy any all such applicable taxes.  In such event, at the election of Grantee, and subject to such rules and limitations as may be established by the Board from time to time, such withholding obligations may be satisfied through the surrender of shares of Stock (a) which Grantee already owns, or (b) to which Grantee is otherwise entitled under the Plan; provided, however, that shares described in this clause (b) may be used to satisfy not more than the Company’s minimum statutory withholding obligation (based on minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to such taxable income).  

			
	
			
				 7.
			Dividends.  Grantee shall not be prevented from receiving dividends and distributions paid on the Covered Shares merely because those shares are subject to the restrictions imposed by this Agreement and the Plan; provided, however that no dividends or distributions shall be 

		

		

		 

		

			3

		

 

		payable to or for the benefit of Grantee with respect to record dates for such dividends or distributions for any Covered Shares occurring on or after the date, if any, on which Grantee has forfeited those shares.
		

			
	
			
				 8.
			Voting.  Grantee shall not be prevented from voting the Covered Shares merely because those shares are subject to the restrictions imposed by this Agreement and the Plan; provided, however, that Grantee shall not be entitled to vote Covered Shares with respect to record dates for any Covered Shares occurring on or after the date, if any, on which Grantee has forfeited those shares.

			
	
			
				 9.
			Heirs and Successors.  This Agreement shall be binding upon, and inure to the benefit of, the Company and its successors and assigns, and upon any person acquiring, whether by merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company’s assets and business.  If any rights of Grantee or benefits distributable to Grantee under this Agreement have not been exercised or distributed, respectively, at the time of Grantee’s death, such rights shall be exercisable by the Designated Beneficiary, and such benefits shall be distributed to the Designated Beneficiary, in accordance with the provisions of this Agreement and the Plan.  If a deceased Grantee fails to designate a beneficiary, or if the Designated Beneficiary does not survive Grantee, any rights that would have been exercisable by Grantee and any benefits distributable to Grantee shall be exercised by or distributed to the legal representative of the estate of Grantee.  If a deceased Grantee designates a beneficiary and the Designated Beneficiary survives Grantee but dies before the Designated Beneficiary’s exercise of all rights under this Agreement or before the complete distribution of benefits to the Designated Beneficiary under this Agreement, then any rights that would have been exercisable by the Designated Beneficiary shall be exercised by the legal representative of the estate of the Designated Beneficiary, and any benefits distributable to the Designated Beneficiary shall be distributed to the legal representative of the estate of the Designated Beneficiary.

			
	
			
				 10.
			Administration.  The authority to manage and control the operation and administration of this Agreement shall be vested in the Board, and the Board shall have all powers with respect to this Agreement as it has with respect to the Plan.  Any interpretation of the Agreement by the Board and any decision made by it with respect to the Agreement is final and binding on all persons.

			
	
			
				 11.
			Plan Governs.  Notwithstanding anything in this Agreement to the contrary, the terms of this Agreement shall be subject to the terms of the Plan, a copy of which may be obtained by Grantee from the office of the Secretary of the Company; and this Agreement is subject to all interpretations, amendments, rules and regulations promulgated by the Board from time to time pursuant to the Plan.

			
	
			
				 12.
			Fractional Shares.  In lieu of issuing a fraction of a share of Stock resulting from an adjustment of the Award pursuant to Section 17.4 of the Plan or otherwise, the Company will be entitled to pay to Grantee an amount equal to the fair market value of such fractional share.

			
	
			
				 13.
			No Right to Continued Board Service.  The Award will not confer on Grantee any right with respect to continuance of service on the Board or to the Company or its Subsidiaries 

		

		

		 

		

			4

		

 

		generally, nor will it interfere in any way with any right the Company would otherwise have to terminate or modify the terms of such Grantee’s Service at any time.
		

			
	
			
				 14.
			Notices.  Any written notices provided for in this Agreement or the Plan shall be in writing and shall be deemed sufficiently given if either hand delivered or if sent by fax or overnight courier, or by postage paid first class mail.  Notices sent by mail shall be deemed received three business days after mailing but in no event later than the date of actual receipt.  Notices shall be directed, if to Grantee, at Grantee’s address indicated by the Company’s records, or if to the Company, at the Company’s principal executive office.

			
	
			
				 15.
			Amendment.  This Agreement may be amended in accordance with the provisions of the Plan, and may otherwise be amended by written agreement of Grantee and the Company without the consent of any other person.

			
	
			
				 16.
			Section 83(b) Election.  Grantee may, within 30 days of the Grant Date, file an election under section 83(b) of the Code with the Internal Revenue Service with respect to the Covered Shares (a “Section 83(b) Election”).  Within five business days of filing a Section 83(b) Election, Grantee shall provide a copy of such completed election form to the Company at the following address: 410 17th Street, Suite 1400, Denver, CO 80202, Attention: General Counsel.  Grantee acknowledges that any Section 83(b) Election is Grantee’s sole responsibility, and additionally acknowledges that the Company has hereby advised Grantee to consult with a financial or tax advisor of Grantee’s own choosing with regard to the federal and state tax considerations resulting from the Award and/or the effect of filing a Section 83(b) Election.  The Company is unable to give Grantee any advice or counseling with respect to federal and state tax matters.

			
	
			
				 17.
			Electronic Acceptance.  By logging into and accepting this Agreement through Grantee’s Solium Capital account, Grantee (a) understands, represents, acknowledges and agrees to be bound by this Agreement as if Grantee had manually signed this Agreement and (b) agrees that Solium Capital Inc. or its designee shall retain custody of the Covered Shares until such time as they have vested and all withholding obligations have been satisfied.  In the event that Grantee does not accept this Agreement through the Solium Capital Shareworks system within 90 days of the Grant Date, the Company shall have the option, but not the obligation, to cancel and revoke the award of Covered Shares represented by this Agreement and any such award shall be forfeited by Grantee without any further consideration.

		 

		

			5NEITHER 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:

Original Conversion Price (subject to adjustment herein): $0.28

 

$ ___________

 

PRESSURE BIOSCIENCES, INC.

 

SENIOR SECURED CONVERTIBLE DEBENTURE 

DUE
___________ [2017]

 

THIS SENIOR SECURED CONVERTIBLE
DEBENTURE is one of a series of duly authorized and validly issued Senior Secured Convertible Debentures of Pressure BioSciences,
Inc., a Massachusetts corporation, (the “Company”), having its principal place of business at 14 Norfolk Avenue,
South Easton, Massachusetts 02375, designated as its Senior Secured Convertible Debenture due plus accrued Interest thereon not
previously paid (this debenture, the “Debenture” and, collectively with the other debentures of such series,
the “Debentures”).

 

FOR
VALUE RECEIVED, the Company promises to pay to ___________ or its registered assigns (the “Holder”), or shall
have paid pursuant to the terms hereunder, the principal sum of $ ___________ [reflects increase by 10% original issue discount
from actual subscription proceeds] on [24 months from Issue Date] ___________ (the “Maturity Date”) or such
earlier date as this Debenture is required or permitted to be repaid as provided hereunder, and to pay Interest to the Holder
on the aggregate unconverted and then outstanding principal amount of this Debenture in accordance with the provisions hereof.
This Debenture is subject to the following additional provisions:

 

Section 1. Definitions.
For the purposes hereof, in addition to the terms defined elsewhere in this Debenture: (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).

 

“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, the Company or any Significant
Subsidiary thereof makes a general assignment for the benefit of creditors, 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.

 

    	 

    	 

    

 

“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).

 

“Business Day”
means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on
which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

 

“Buy-In” shall have the meaning set
forth in Section 4(c)(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 50.1%
of the voting securities of the Company (other than by means of conversion or exercise of the Debentures and the Securities issued
together with the Debentures); (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 50.1% 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 50.1% 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.

 

“Common Stock” means the common stock,
par value $0.01 per share of the Company.

 

“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 Debenture in accordance with
the terms hereof.

 

“Debenture Register” shall have the
meaning set forth in Section 2(c).

 

“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, or any successor performing substantially the same function for the Company.

 

“DWAC Shares”
means shares of Common Stock that are (i) issued in electronic form, (ii) freely tradable and transferable and without restriction
on resale and (iii) timely credited by the Company to the Investor’s or its designee’s specified Deposit/Withdrawal
at Custodian (DWAC) account with DTC under its Fast Automated Securities Transfer (FAST) Program, or any similar program hereafter
adopted by DTC performing substantially the same function, with no restrictions.

 

“Equity
Conditions” means, during the period in question, (a) the Company shall have duly honored all conversions and redemptions
scheduled to occur or occurring by virtue of one or more Notices of Conversion of the Holder, if any, (b) the Company shall have
paid all liquidated damages and other amounts owing to the Holder in respect of this Debenture, (c)(i) there is an effective Registration
Statement pursuant to which the Holder is permitted to utilize the prospectus thereunder to resell all of the shares of Common
Stock issuable pursuant to the Transaction Documents (and the Company believes, in good faith, that such effectiveness will continue
uninterrupted for the foreseeable future) or (ii) all of the Conversion Shares issuable pursuant to the Transaction Documents
may be resold by non-Affiliates pursuant to Rule 144 without volume or manner-of-sale restrictions as determined by the counsel
to the Company as set forth in a written opinion letter to such effect, addressed and acceptable to the Transfer Agent and the
Holder the cost of which is to be borne by the Company, (d) the Common Stock is trading on a Trading Market and all of the shares
issuable pursuant to the Transaction Documents are listed or quoted for trading on such Trading Market (and the Company believes,
in good faith, that trading of the Common Stock on a Trading Market will continue uninterrupted for the foreseeable future), (e)
the Conversion Shares constitute DWAC Shares and there is no DTC chill or other DTC limitation on the trading or transferability
of the Underlying Shares, (f) there is a sufficient number of authorized but unissued and otherwise unreserved shares of Common
Stock for the issuance of all of the shares then issuable pursuant to the Transaction Documents, (g) there is no existing Event
of Default and no existing event which, with the passage of time or the giving of notice, would constitute an Event of Default,
(h) the issuance of the shares in question (or, in the case of an Optional Redemption, the shares issuable upon conversion in
full of the Optional Redemption Amount) to the Holder would not violate the limitations set forth in Section 4(d) and Section
4(e) herein, and (i) there has been no public announcement of a pending or proposed Fundamental Transaction or Change of Control
Transaction that has not been consummated.

 

    	2

    	 

    

 

“Event of Default” shall have the
meaning set forth in Section 8(a).

 

“Exempt Issuance”
means the issuance of (a) shares of Common Stock or options or other stock based awards to employees, officers or directors
and consultants of the Company pursuant to the Company’s stock or option plans existing as of the date hereof and to also
include up to 2,500,000 shares of Common Stock (subject to adjustment for forward and reverse stock splits, recapitalizations
and the like), in the aggregate, to employees, officers or directors and consultants of the Company pursuant to a written agreement,
provided that such shares of Common Stock are not registered and carry no registration rights other than on Form S-8, (b) securities
upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable
for or convertible into shares of Common Stock issued and outstanding on the Original Issue Date of this Debenture, provided that
such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease
the exercise price, exchange price or conversion price of such securities, and (c) securities issued pursuant to acquisitions
or strategic transactions approved by a majority of the disinterested directors of the Company, provided that any such issuance
shall only be to a Person (or to the equityholders of a Person) which is, itself or through its subsidiaries, an operating company
or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional
benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities
primarily for the purpose of raising capital or to an entity whose primary business is investing in securities.

 

“Forced Conversion” shall have the
meaning set forth in Section 6(d).

 

“Forced Conversion Date” shall have
the meaning set forth in Section 6(d).

 

“Forced Conversion Notice” shall
have the meaning set forth in Section 6(d).

 

“Forced Conversion Notice Date” shall
have the meaning set forth in Section 6(d).

 

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

 

“Interest”
shall mean 10% interest per annum on the outstanding principal amount of Debentures, compounded annually to the extent not
paid.

 

“Interest Payment Date” shall have
the meaning set forth in Section 2(a).

 

“Issuable Maximum” shall have the
meaning set forth in Section 4(e).

 

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

 

“Mandatory Default
Amount” means the sum of (a) the greater of (i) the outstanding principal amount of this Debenture, plus all accrued
and unpaid interest hereon, divided by the Conversion Price on the date the Mandatory Default Amount is either (A) demanded (if
demand or notice is required to create an Event of Default) or otherwise due or (B) paid in full, whichever has a lower Conversion
Price, multiplied by the VWAP on the date the Mandatory Default Amount is either (x) demanded or otherwise due or (y) paid in
full, whichever has a higher VWAP, or (ii) 125% of the outstanding principal amount of this Debenture, plus 100% of accrued and
unpaid interest hereon, and (b) all other amounts, costs, expenses and liquidated damages due in respect of this Debenture.

 

“Majority in
Interest” means, at any time of determination, sixty-seven percent (67%) in interest (based on then-outstanding principal
amounts of Debentures at the time of such determination) of the holders of Debentures.

 

“Memorandum”
means the private placement memorandum dated as of April __, 2015, describing the private placement offering by the Company,
pursuant to which this Debenture has been issued and sold.

 

“New York Courts” shall have the
meaning set forth in Section 9(d).

 

    	3

    	 

    

 

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

 

“Optional Redemption” shall have
the meaning set forth in Section 6(a).

 

“Optional Redemption
Amount” means the sum of: (a) (i) 120% of the then outstanding principal amount of the Debenture or (ii) if after the
date of the Payment in Kind Notice as provided in Section 2(a) below, 125% of the then outstanding principal amount of the Debenture;
(b) all liquidated damages and other amounts due in respect of the Debenture; and (c) an additional amount equal to the amount
of interest that, but for such redemption hereunder, would have accrued with respect to the principal amount then outstanding
under this Debenture being for the period from the date of such redemption hereunder through the Maturity Date.

 

“Optional Redemption Date” shall
have the meaning set forth in Section 6(a).

 

“Optional Redemption Notice” shall
have the meaning set forth in Section 6(a).

 

“Optional Redemption Notice Date” shall
have the meaning set forth in Section 6(a).

 

“Optional Redemption Period” shall
have the meaning set forth in Section 6(a).

 

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

 

“Permitted Indebtedness”
means: (a) the indebtedness evidenced by the Debentures; (b) the Indebtedness existing on the Original Issue Date and set
forth on Schedule 3.1(aa) attached to the Purchase Agreement; (c) indebtedness to trade creditors incurred in the ordinary
course of business, including indebtedness incurred in the ordinary course of business with corporate credit cards; (d) Subordinated
Indebtedness; (e) indebtedness owed to employees and officers of the Company in the ordinary course of business and (f) and extensions,
refinancings and renewals of any items of Permitted Indebtedness, provided that the principal amount is not increased or the terms
modified to impose materially more burdensome terms upon the Company or its Subsidiary, as the case may be.

 

“Permitted Lien”
means (i) Liens in favor of the Holder; (ii) Liens for taxes, fees, assessments or other governmental charges or levies, either
not delinquent or being contested in good faith by appropriate proceedings; provided, that the Company maintains adequate reserves
therefor in accordance with GAAP; (iii) Liens securing claims or demands of materialmen, artisans, mechanics, carriers, warehousemen,
landlords and other like Persons arising in the ordinary course of the Company’s business and imposed without action of
such parties; provided, that the payment thereof is not yet required; (iv) Liens arising from judgments, decrees or attachments
in circumstances which do not constitute an Event of Default hereunder; (vi) Liens on equipment or software or other intellectual
property constituting purchase money liens and liens in connection with capital leases securing indebtedness permitted in clause
(c) of “Permitted Indebtedness”; (vii) Liens incurred in connection with Subordinated Indebtedness; (viii) leases
or subleases and licenses granted in the ordinary course of business and not interfering in any material respect with the business
of the lessor or licensor; (ix) the interests of lessors under operating leases and non-exclusive licensors under license agreements;
and (x) Liens incurred in connection with the extension, renewal or refinancing of the indebtedness secured by Liens of the type
described in clauses (i) through (ix) above; provided, that any extension, renewal or replacement Lien shall be limited to the
property encumbered by the existing Lien and the principal amount of the indebtedness being extended, renewed or refinanced (as
may have been reduced by any payment thereon) does not increase.

 

“Purchase Agreement”
means the Subscription Agreement and Investor Questionnaire, dated as of May 10, 2015 among the Company and the original Holders,
as amended, modified or supplemented from time to time in accordance with its terms, providing for the sale to the Holders of
the Debentures and the Common Stock Warrants described therein.

 

“Registration
Statement” means a registration statement meeting the requirements set forth in the Purchase Agreement and 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).

 

    	4

    	 

    

 

“Subordinated
Indebtedness” means (i) unsecured indebtedness subordinated to the Debentures in amounts and on terms and conditions
reasonably satisfactory to a Majority in Interest, and (ii) secured indebtedness subordinated to the Debentures in amounts and
on terms and conditions satisfactory to a Majority in Interest in their sole discretion.

 

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

 

“Threshold Period” shall have the
meaning set forth in Section 6(d).

 

“Trading Day” means a day on which
the principal Trading Market is open for trading.

 

“Trading Market”
means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question:
the NYSE MKT, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange
or the OTC Bulletin Board (or any successors to any of the foregoing).

 

“Transaction
Documents” means this Debenture, the Purchase Agreement, the Security Agreement and the Warrant (as defined in the Purchase
Agreement).

 

“Underlying Shares”
means the Conversion Shares and any shares of Common Stock issued or issuable by the Company as payment of Interest under
this Debenture, including shares of Common Stock issuable under Section 2(a) below.

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then
listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based
on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the OTC Bulletin Board is not
a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the OTC
Bulletin Board, (c) if the Common Stock is not then listed or quoted for trading on the OTC Bulletin Board and if prices for the
Common Stock are then reported in the “Pink Sheets” published by Pink OTC Markets, Inc. (or a similar organization
or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported,
or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected
in good faith by the Holders of a majority in interest of the Securities then outstanding and reasonably acceptable to the Company,
the fees and expenses of which shall be paid by the Company.

 

Section 2. Payment in Kind; Interest.

 

a) Payment in Kind.
At the Company’s option, upon ten business days prior written notice to the Holder (“Payment in Kind Notice”),
payment of principal (in full or partially) of the Debenture may be made at the Maturity Date by issuance of a number of shares
of Common Stock equal to the sum determined by dividing the principal amount of the Debenture held by the Holder by the average
VWAP price of the Company’s Common Stock for the ten (10) days prior to the Conversion Date.

 

b) In order for the Company
to avail itself of the ability to make payment of the Debenture with shares of its Common Stock the following conditions shall
be satisfied at the date of the Payment in Kind Notice.

 

(i) the Equity Conditions shall
have been satisfied;

 

(ii) the Maturity Date of
the Debenture shall be extended for an additional 180 days and the Debentures (the “Maturity Extended Period”)
shall continue to bear Interest; and

 

(iii) the Company has sufficient
authorized shares of Common Stock reserved for issuance in connection with the conversion or payment of the Debenture in shares
of Common Stock (plus interest) equal to 300% of the number of shares of Common Stock issuable at the Conversion Price then in
effect.

 

During the Extended Maturity Period the Company
shall not have the right to force conversion or redeem the Debenture under Section 6 hereof.

 

c) Payment of Interest.
The Company shall pay Interest to the Holder on the principal amount of this Debenture on a calendar quarterly basis on each
of March 30th, June 30th, September 30th and December 30th, on all outstanding amounts under
this Debenture commencing on a date which is the twelve month anniversary date following the Original Issue Date. At the Company’s
option, interest may be payable, provided the Equity Conditions are then satisfied, based upon the average VWAP price of the Company’s
Common Stock for the ten (10) days prior to the Interest due date.

 

    	5

    	 

    

 

Section 3. Registration of Transfers and Exchanges.

 

a) Different Denominations.
This Debenture is exchangeable for an equal aggregate principal amount of Debentures 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 Debenture 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 Debenture
Register. Prior to due presentment for transfer to the Company of this Debenture, the Company and any agent of the Company
may treat the Person in whose name this Debenture is duly registered on the Debenture Register as the owner hereof for the purpose
of receiving payment as herein provided and for all other purposes, whether or not this Debenture is overdue, and neither the
Company nor any such agent shall be affected by notice to the contrary.

 

Section 4. Conversion.

 

a) Voluntary Conversion.
At any time after the Original Issue Date until this Debenture is no longer outstanding, this Debenture 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(d) and 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 A (each, a “Notice of Conversion”),
specifying therein the principal amount of this Debenture 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 Debenture to the Company
unless the entire principal amount of this Debenture has been so converted. Conversions hereunder shall have the effect of lowering
the outstanding principal amount of this Debenture 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 two (2) Business Days 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 Debenture, acknowledge and agree that, by reason of the provisions of this paragraph,
following conversion of a portion of this Debenture, the unpaid and unconverted principal amount of this Debenture 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 $0.28, per share, subject to adjustment herein
(the “Conversion Price”).

 

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 Debenture to be converted by (y)
the Conversion Price.

 

ii. Delivery of Certificate
Upon Conversion. Not later than three (3) 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 earlier of (i) the six month anniversary of the Original Issue Date or (ii) the Effective Date,
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 Debenture and (B) a Company or bank check
in the amount of accrued and unpaid Interest. On or after the earlier of (i) the six month anniversary of the Original Issue Date
or (ii) the Effective Date, the Company shall use its reasonable best efforts to deliver any certificate or certificates required
to be delivered by the Company under this Section 4(c) electronically through The Depository Trust Company or another established
clearing corporation performing similar functions.

 

    	6

    	 

    

 

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 Debenture 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.
The Company’s obligations to issue and deliver the Conversion Shares upon conversion of this Debenture 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 Debenture shall elect to convert
any or all of the outstanding principal 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 Debenture
shall have been sought and obtained, and the Company posts a surety bond for the benefit of the Holder in the amount of the outstanding
principal amount of this Debenture, 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. Nothing herein shall limit a Holder’s right to pursue actual damages or declare an Event of
Default pursuant to Section 8 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.

 

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 Debenture 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 Debenture 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 Debenture as required pursuant to the terms hereof.

 

    	7

    	 

    

 

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 for the sole purpose of issuance upon conversion of this Debenture, free from preemptive rights
or any other actual contingent purchase rights of Persons other than the Holder (and the other holders of the Debentures), 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 Debenture. 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, if the Registration Statement is then effective under
the Securities Act, shall be registered for public resale in accordance with such Registration Statement (subject to such Holder’s
compliance with its obligations under the Registration Rights Agreement).

 

vii. Fractional Shares.
No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Debenture. 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 Debenture 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
Debenture 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 this Debenture, and a Holder shall not have the right to convert
any portion of this Debenture, 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 Debenture 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 Debenture 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 Debentures or the Warrants
as described in the Purchase Agreement)) beneficially owned by the Holder or any of its Affiliates. Except as set forth in the
preceding sentence, for purposes of this Section 4(d), 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 Debenture is convertible (in relation to other securities owned by the
Holder together with any Affiliates) and of which principal amount of this Debenture 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 Debenture may be converted (in relation to other securities owned by the Holder together with any Affiliates) and which principal
amount of this Debenture 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(d), 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 Debenture, 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 4.99% 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 Debenture
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(d), 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
upon conversion of this Debenture held by the Holder and the Beneficial Ownership Limitation provisions of this Section 4(d) 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 Debenture.

 

    	8

    	 

    

 

Section 5. Certain Adjustments.

 

a) Stock Dividends
and Stock Splits. If the Company, at any time while this Debenture 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 the Debentures
or upon the exercise of any options or warrants), (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 Debenture is outstanding, the Company or any Subsidiary, as applicable, sells or grants
any option to purchase or reprices or reduce the conversion or exercise price of any outstanding Securities, grants any right
to reprice, or otherwise disposes of or issues, 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, other than in connection with any
Common Stock Equivalents outstanding on the Original Issue Date (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 Conversion
Price, such issuance shall be deemed to have occurred for less than the Conversion Price on such date of the Dilutive Issuance),
then the Conversion Price shall be reduced to equal the Base Conversion Price. Such adjustment shall be made whenever such Common
Stock or Common Stock Equivalents are issued. Notwithstanding the foregoing, no adjustment will be made under this Section 5(b)
in respect of an Exempt Issuance. If the Company enters into a Variable Rate Transaction, despite the prohibition set forth in
the Purchase Agreement, the Company shall be deemed to have issued Common Stock or Common Stock Equivalents at the lowest possible
conversion price at which such securities may be converted or exercised. 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.

 

    	9

    	 

    

 

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 Debenture (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) Pro Rata Distributions.
During such time as this Debenture is outstanding, if the Company shall declare or make any dividend or other distribution
of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise
(including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Debenture, then, in each such case, the Holder shall be entitled to participate in
such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares
of Common Stock acquirable upon complete exercise of this Debenture (without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution,
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
participation in such Distribution (provided, however, to the extent that the Holder’s right to participate in any
such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled
to participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of
such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder
until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

e) Fundamental Transaction.
If, at any time while this Debenture 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 more than 50% 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, or (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 or group of Persons whereby such other Person or group
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 Debenture, 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(d) and Section 4(e) on the conversion of this Debenture), 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
Debenture is convertible immediately prior to such Fundamental Transaction (without regard to any limitation in Section 4(d) and
Section 4(e) on the conversion of this Debenture). 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 Debenture 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 Debenture and the other Transaction Documents in accordance with the provisions of this Section 5(e)
pursuant to written agreements in form and substance reasonably satisfactory to the holders of a majority in principal amount
of the Debentures prior to such Fundamental Transaction and shall, at the option of the holder of this Debenture, deliver to the
Holder in exchange for this Debenture a security of the Successor Entity evidenced by a written instrument substantially similar
in form and substance to this Debenture 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 Debenture
(without regard to any limitations on the conversion of this Debenture) 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 Debenture
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 Debenture 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 Debenture and the other Transaction Documents
with the same effect as if such Successor Entity had been named as the Company herein.

 

    	10

    	 

    

 

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 Debenture, and shall cause to be delivered to the Holder at its last address as it shall appear upon the
Debenture Register, at least ten (10) 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 Debenture
during the 10-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.

 

    	11

    	 

    

 

Section 6. Redemption and Forced Conversion.

 

a) Optional Redemption
at Election of Company. Subject to the provisions of this Section 6(a), at any time after Original Issue Date and from time
to time, the Company may deliver a notice to the Holder (an “Optional Redemption Notice” and the date such
notice is deemed delivered hereunder, the “Optional Redemption Notice Date”) of its irrevocable election to
redeem all or any portion of the then outstanding principal amount of this Debenture and all other outstanding Debentures on a
pro rata basis based upon the total principal amount of Debentures then outstanding for cash in an amount equal to the Optional
Redemption Amount on the 10th business day following the Optional Redemption Notice Date (such date, the “Optional
Redemption Date”, such 10th business day period, the “Optional Redemption Period” and
such redemption, the “Optional Redemption”). The Optional Redemption Amount is payable in full on the Optional
Redemption Date. The Company covenants and agrees that it will honor all Notices of Conversion tendered from the time of delivery
of the Optional Redemption Notice through the date all amounts owing thereon are due and paid in full. The Company’s determination
to pay an Optional Redemption in cash shall be applied ratably to all of the holders of the then outstanding Debentures based
on their (or their predecessor’s) initial purchases of Debentures pursuant to the Purchase Agreement.

 

b) Optional Redemption
at the Election of the Holder. Subject to the provisions of this Section 6, at any time after either (i) the date the Company
announces a Change in Control Transaction or (ii) the date the Company or any Subsidiary enters into an agreement providing for
the sale of a material portion of their respective assets, the Holder may deliver a notice to the Company (a “Holder
Optional Redemption Notice” and the date such notice is deemed delivered hereunder, the “Holder Optional Redemption
Notice Date”) of its irrevocable election to cause the Company redeem some or all of the then outstanding principal
amount of this Debenture for cash in an amount equal to the Optional Redemption Amount on the later of (i) the 5th Trading Day
following the Holder Optional Redemption Notice Date or (ii) the date such applicable transaction triggering such redemption right
is consummated (such date, the “Holder Optional Redemption Date” and such redemption, the “Holder
Optional Redemption”). The Optional Redemption Amount is payable in full on the Holder Optional Redemption Date. Any
Holder Optional Redemption shall be applied ratably to all Holders that submit a Holder Optional Redemption based on their (or
their predecessor’s) initial purchases of Debentures pursuant to the Purchase Agreement. The Company hereby agrees to publicly
disclose any Change of Control Transaction or entry into an asset sale agreement which would trigger a redemption right hereunder
within one Trading Day from the date such agreement or transaction is entered into.

 

c) Redemption Procedure.
The payment of cash pursuant to an Optional Redemption or a Holder Optional Redemption shall be payable on the Optional Redemption
Date or Holder Optional Redemption Date. If any portion of the payment pursuant to an Optional Redemption or Holder Optional Redemption
shall not be paid by the Company by the applicable due date, interest shall accrue thereon at an interest rate equal to the lesser
of 18% per annum or the maximum rate permitted by applicable law until such amount is paid in full. Notwithstanding anything herein
contained to the contrary, if any portion of an Optional Redemption Amount in connection with an Optional Redemption remains unpaid
after such date, the Holder may elect, by written notice to the Company given at any time thereafter, to invalidate such Optional
Redemption, ab initio, and, with respect to the Company’s failure to honor the Optional Redemption, the Company shall
have no further right to exercise such Optional Redemption. The Holder may elect to convert the outstanding principal amount of
the Debenture pursuant to Section 4 prior to actual payment in cash for any redemption under this Section 6 by the delivery of
a Notice of Conversion to the Company.

 

    	12

    	 

    

 

d) Forced Conversion.
Notwithstanding anything herein to the contrary, if after the 6 month anniversary of the Closing Date provided that: (i) (A)
Equity Conditions have been satisfied and are in effect; and (B) the VWAP for 15 out of any 20 consecutive Trading Days, which
period shall have commenced only after the 6 month anniversary of the Closing Date but prior to the 10th day prior
to the Maturity Date (such period the “Threshold Period”), exceeds 300% of the applicable Conversion Price,
or (ii) (Y) the Company’s Common Stock is listed for trading on the Nasdaq Stock Market or (Z) the Company completes an
underwritten public offering of its Common Stock under the Securities Act for gross proceeds equal to the larger of (a) two (2)
times the amount of Debentures sold in the aggregate pursuant to the terms of the offering as described in the Memorandum
or (b) $5,000,000, the Company may, within three (3) Trading Days after the end of any such Threshold Period, deliver a written
notice to the Holder (a “Forced Conversion Notice” and the date such notice is delivered to the Holder, the
“Forced Conversion Notice Date”) to cause the Holder to convert all or part of the then outstanding
principal amount of this Debenture plus, if so specified in the Forced Conversion Notice, accrued but unpaid interest, liquidated
damages and other amounts owing to the Holder under this Debenture, it being agreed that the “Conversion Date” for
purposes of Section 4 shall be deemed to occur on the fifth Trading Day following the Forced Conversion Notice Date (such fifth
Trading Day, the “Forced Conversion Date”). The Company may not deliver a Forced Conversion Notice, and any
Forced Conversion Notice delivered by the Company shall not be effective, unless all of the Equity Conditions are met (unless
waived in writing by the Holder) on each Trading Day occurring during the applicable Threshold Period through and including the
later of the Forced Conversion Date and the Trading Day after the date such Conversion Shares pursuant to such conversion are
delivered to the Holder. Any Forced Conversion shall be applied ratably to all Holders based on their initial purchases of Debentures
pursuant to the Purchase Agreement, provided that any voluntary conversions by a Holder shall be applied against the Holder’s
pro rata allocation, thereby decreasing the aggregate amount forcibly converted hereunder if only a portion of this Debenture
is forcibly converted. For purposes of clarification, a Forced Conversion shall be subject to all of the provisions of Section
4, including, without limitation, the provision requiring payment of liquidated damages and limitations on conversions.

 

Section 7. Negative
Covenants. As long as any portion of this Debenture remains outstanding, unless the holders of a Majority in Interest shall
have otherwise given prior written consent, the Company shall not, and shall not permit any of the Subsidiaries to, directly or
indirectly:

 

a) other than Permitted
Indebtedness, enter into, create, incur, assume, guarantee or suffer to exist any indebtedness for borrowed money of any kind,
including, but not limited to, a guarantee, on or with respect to any of its property or assets now owned or hereafter acquired
or any interest therein or any income or profits therefrom;

 

b) other than Permitted
Liens, enter into, create, incur, assume or suffer to exist any Liens of any kind, on or with respect to any of its property or
assets now owned or hereafter acquired or any interest therein or any income or profits therefrom;

 

c) amend its charter documents,
including, without limitation, its certificate of incorporation and bylaws, in any manner that materially and adversely affects
any rights of the Holder;

 

d) repay, repurchase or
offer to repay, repurchase or otherwise acquire more than a de minimis number of shares of its Common Stock or Common Stock
Equivalents other than as to (i) the Conversion Shares or Warrant Shares as permitted or required under the Transaction Documents
and (ii) repurchases of Common Stock or Common Stock Equivalents pursuant to employee, director or consultant repurchase plans
or similar agreements;

 

e) prepay any Indebtedness,
other than the Debentures if on a pro-rata basis and other than pursuant to payments of Permitted Indebtedness;

 

f) pay cash dividends
or distributions on any equity securities of the Company;

 

g) enter into any transaction
with any Affiliate of the Company which would be required to be disclosed in any public filing with the Commission, unless such
transaction is made on an arm’s-length basis and expressly approved by a majority of the disinterested directors of the
Company (even if less than a quorum otherwise required for board approval); or

 

    	13

    	 

    

 

h) use the proceeds from
the sale of the Debentures in a manner not described or provided for as described in the “Use of Proceeds” section
of the Memorandum.

 

Section 8. 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 Debenture or (B) interest, liquidated damages and other amounts owing to a Holder on any Debenture,
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 ten (10)
Trading Days;

 

ii. the Company shall fail
to observe or perform any other covenant or agreement contained in the Debentures (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) ten (10) Trading Days after notice of such failure sent
by the Holder or by any other Holder to the Company and (B) fifteen (15) Trading Days after the Company has become aware of such
failure;

 

iii. a default or event
of default or breach of covenant shall occur under any of the Transaction Documents (subject to any grace or cure period provided
therein) ;

 

iv. any representation or
warranty made in this Debenture or any other Transaction Documents shall be untrue or incorrect in any material respect as of
the date when made or deemed made, which is not cured within 15 Trading Days;

 

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
$100,000, 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 (5) Trading Days or there is a DTC chill upon the Common stock which is not vacated or cured within
five (5) Trading Days;

 

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 25% 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
to timely satisfy its obligations to file periodic reports with the Securities and Exchange Commission under Sections 13 or 15(d)
of the Securities and Exchange Act of 1934, as amended, which is not cured within 30 calendar days of the applicable due date
or files a Form 15 to withdraw such filing requirements.

 

x. the Company fails to
satisfy its obligations under the Purchase Agreement to register for resale the Underlying Shares under the Securities Act;

 

xi. the Board of Directors
of the Company shall fail to recommend to its stockholders for a vote of stockholders in accordance with the laws of the Commonwealth
of Massachusetts and the rules and regulations of the Securities and Exchange Commission an increase in the number of shares of
authorized Common Stock in a number so as to provide for the conversion of all Debentures and exercise of all Warrants in accordance
herewith and therewith, on or before November 10, 2015, and a vote of stockholders occurs on or before December 31, 2015; provided,
however, in the event that the stockholders of the Company do not vote approving favor of such increase on or before December
31, 2015, the Company shall have 120 days from December 31, 2015 to obtain such stockholder approval.

 

    	14

    	 

    

 

xii. the Company shall fail
for any reason to deliver certificates to a Holder prior to the fifth (5th) Trading Day after a Conversion Date pursuant
to Section 4(c) or any Forced Conversion Date pursuant to Section 6(d) 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
Debentures in accordance with the terms hereof; or

 

xiii. 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 individually or $300,000 in the aggregate, and such judgment, writ or similar final process
shall remain unvacated, unbonded or unstayed for a period of 45 calendar days.

 

b) Remedies Upon Event
of Default. If any Event of Default occurs (other than an Event of Default under Section 8(a)(v)), the outstanding principal
amount of this Debenture, plus accrued but unpaid interest, liquidated damages and other amounts owing in respect thereof through
the date of acceleration, shall become, at the written election of a Majority in Interest, immediately due and payable in cash
at the Mandatory Default Amount. If any Event of Default in Section 8(a)(v) occurs, the outstanding principal amount of this Debenture,
plus accrued but unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration,
shall become immediately due and payable in cash at the Mandatory Default Amount. Commencing five (5) days after the occurrence
of any Event of Default that results in the eventual acceleration of this Debenture, the interest rate on this Debenture shall
accrue at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted under applicable law. Upon the payment
in full of the Mandatory Default Amount, the Holder shall promptly surrender this Debenture 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 Debenture until such time, if any, as the Holder receives full payment pursuant to this Section 8(b). No such rescission
or annulment shall affect any subsequent Event of Default or impair any right consequent thereon.

 

Section 9. 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 9(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 5:30 p.m. (New York
City 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 5:30 p.m. (New York City 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.

 

    	15

    	 

    

 

b) Absolute Obligation.
Except as expressly provided herein, no provision of this Debenture 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 Debenture
at the time, place, and rate, and in the coin or currency, herein prescribed. This Debenture is a direct debt obligation of the
Company. This Debenture ranks pari passu with all other Debentures now or hereafter issued under the terms set forth herein
and the Purchase Agreement.

 

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

 

d) Governing Law. All
questions concerning the construction, validity, enforcement and interpretation of this Debenture shall be governed by and construed
and enforced in accordance with the internal laws of the State of New York, 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 the City of New York,
Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the New York 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 New York Courts, or such New York 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 Debenture 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 Debenture or
the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any provisions of this Debenture,
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.

 

e) Waiver. Any
waiver by the Company or the Holder of a breach of any provision of this Debenture 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 Debenture. The failure of the Company
or the Holder to insist upon strict adherence to any term of this Debenture 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 Debenture
on any other occasion. Any waiver by the Company or the Holder must be in writing.

 

f) Severability. If
any provision of this Debenture is invalid, illegal or unenforceable, the balance of this Debenture 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 Debenture
as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance
of this Debenture, 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) 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.

 

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

 

i) Secured Obligation.
The obligations of the Company under this Debenture are secured by a lien and security interest on all assets of the Company
and each Subsidiary pursuant to the Security Agreement, dated as of July 21, 2015 between the Company, the Subsidiaries of the
Company, the Agent ( as named therein) and the Secured Parties (as defined therein).

 

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

 

(Signature Pages Follow)

 

    	16

    	 

    

 

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

 

	 	PRESSURE
    BIOSCIENCES, INC.

 

	 	By:	 
	 	Name:	 
	 	Title:	 

 

	 	Facsimile No. for delivery of Notices:
	 	 
	 	 

 

    	17

    	 

    

 

ANNEX A

 

NOTICE OF CONVERSION

 

The undersigned hereby
elects to convert principal under the Senior Secured Convertible Debenture due _________ of Pressure BioSciences, Inc., a Delaware
corporation (the “Company”), into shares of common stock, par value $0.01 per share (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 Debenture, 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 Debenture to be Converted:

Number of shares of Common Stock to be issued:

Signature:

 

Name:

Address for Delivery of Common Stock Certificates:

Or

 

DWAC Instructions:

 

Broker No:                         

 

Account No:                         

 

    	18

    	 

    

 

Schedule 1

 

CONVERSION SCHEDULE

 

The Senior Secured Convertible Debenture due
on July 21, 2017, 2015 in the original principal amount of $                 
is issued by Pressure BioSciences, Inc. This Conversion Schedule reflects conversions made under Section 4 of the above referenced
Debenture

 

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
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

 

    	19

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00247-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00247-of-00352.parquet"}]]