Document:

Exhibit

EXHIBIT 10.110

CENTRAL VALLEY COMMUNITY BANK 

EXECUTIVE DEFERRED 
COMPENSATION PLAN

Effective October 21, 2015

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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS1
1.01.Bank    1
1.02.Beneficiary Designation Form    1
1.03.Board    1
1.04.Change In Control    1
1.05.Code    2
1.06.Code Section 409A    2
1.07.Committee    2
1.08.Compensation    2
1.09.Deferral Election Form    2
1.10.Deferral Year    2
1.11.Deferral Account    2
1.12.Deferred Benefit    2
1.13.Designated Beneficiary    2
1.14.Disability or Disabled    3
1.15.Distribution Election Form    3
1.16.Election Date    3
1.17.Eligible Executive    3
1.18.For Cause    3
1.19.Participant    4

{00361047/4}    (i)

1.20.Plan    4
1.21.Termination of Employment or Terminates Employment    4
1.22.Unforeseeable Emergency    4
ARTICLE II DEFERRAL ELECTIONS5
2.01.Eligibility To Make Deferral Election    5
2.02.Deferral Elections    5
2.03.Rejection of Deferral Election    5
ARTICLE III CREDITING DEFERRALS AND INTEREST TO DEFERRAL ACCOUNTS6
3.01.Deferrals    6
3.02.Interest    6
3.03.Vesting and Forfeiture    6
ARTICLE IV DISTRIBUTIONS6
4.01.Distribution Elections    6
4.02.Commencement of Distributions    7
4.03.Medium of Payment    7
4.04.Changing Distribution Election    7
4.05.Unforeseeable Emergency Distributions    7
4.06.Cashouts    8
4.07.Distributions to Specified Employees    8
ARTICLE V RESTRICTIONS AND LIMITATIONS ON PAYMENT OF BENEFITS8

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5.01.Excess Parachute Payments    8
5.02.Payment Restrictions    9
5.03.Regulatory Compliance    9
ARTICLE VI RESTRICTIONS ON TRANSFER OF BENEFITS10
6.01.No Control or Alienation    10
6.02.Assignment of Benefits in Connection with Separation or Divorce    10
ARTICLE VII AMENDMENT OR TERMINATION10
ARTICLE VIII ADMINISTRATION10
8.01.Committee    10
8.02.Indemnification    11
8.03.Eligibility Determinations    11
8.04.Information to Committee    11
8.05.Notices    11
8.06.Waiver    11
8.07.Claims    11
ARTICLE IX GENERAL12
9.01.Plan Creates No Separate Rights    12
9.02.Unfunded Status Of Plan    12
9.03.Plan Binding    13
9.04.Interpretation of Plan    13
9.05.Construction    13

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{00361047/4}    (iv)

CENTRAL VALLEY COMMUNITY BANK 
EXECUTIVE DEFERRED COMPENSATION PLAN

The Central Valley Community Bank Executive Deferred Compensation Plan is hereby adopted effective October 21, 2015.

The Plan is intended to constitute an unfunded arrangement maintained by the Bank primarily for the purpose of providing a deferred compensation plan for a select group of management or highly compensated employees, as described in sections 201(2), 301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act of 1974 (“ERISA”).  

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ARTICLE I 
DEFINITIONS
The following definitions apply to this Plan and to the related Deferral Election Forms, Distribution Election Forms and Beneficiary Designation Forms.
		
	1.01.
	Bank

Bank means Central Valley Community Bank.
		
	1.02.
	Beneficiary Designation Form 

Beneficiary Designation Form means a form approved by the Committee that is used by a Participant to name his or her primary and contingent Designated Beneficiary to receive all unpaid Deferred Benefit payments if he or she dies.
		
	1.03.
	Board 

Board means the Board of Directors of the Bank.
		
	1.04.
	Change In Control 

A “Change In Control” shall be deemed to have occurred on the date that any one person, or more than one person acting as a group, acquires ownership of stock of the Bank that, together with stock held by such person or group, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Bank.  However, if any one person or more than one person acting as a group, is considered to own more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Bank, the acquisition of additional stock by the same person or persons will not be considered to cause a Change In Control.  Further, an increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which the Bank acquires its stock in exchange for property will not be considered to cause a Change In Control.  Transfers of Bank stock on account of death, gift, transfers between family members or transfers to a qualified retirement plan maintained by the Bank shall not be considered in determining whether there has been a Change In Control.  For purposes of this Section, the term “Bank” shall include any holding company, meaning any corporation that is a majority shareholder of the Bank.  A “Change In Control” shall be interpreted in accordance with the definition of “Change in Ownership” under Code Section 409A, and to the extent that an event or series of events does not constitute a “Change in Ownership” under Code Section 409A, the event or series of events will not constitute a “Change In Control” under this Plan.
		
	1.05.
	Code

Code means the Internal Revenue Code of 1986, as amended.
		
	1.06.
	Code Section 409A 

Code Section 409A includes Code section 409A and regulations and guidance promulgated thereunder, as amended from time to time.
		
	1.07.
	Committee 

Committee means the Executive Compensation Committee appointed by the Board.
		
	1.08.
	Compensation 

Compensation means an Eligible Executive’s cash remuneration for a Deferral Year, including salary and any bonus or incentive payments.
		
	1.09.
	Deferral Election Form 

Deferral Election Form means a form approved by the Committee that is used by a Participant to defer Compensation pursuant to the Plan.
		
	1.10.
	Deferral Year 

Deferral Year means a calendar year for which a Participant has an operative Deferral Election Form.
		
	1.11.
	Deferral Account

Deferral Account means the unfunded deferred compensation account established to record a Participant’s interest in the Plan.

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	1.12.
	Deferred Benefit 

Deferred Benefit means the Participant’s Deferral Account balance as of a specified date, including credited interest.
		
	1.13.
	Designated Beneficiary

Designated Beneficiary means a person or persons or other entity designated on a Beneficiary Designation Form by a Participant to receive a Deferred Benefit payment.  If there is no valid designation by the Participant, or if the primary and contingent Designated Beneficiaries fail to survive the Participant or otherwise fail to take the Deferred Benefit, the Participant’s Designated Beneficiary shall be determined in the following order:  a Participant’s spouse (the person legally married to the Participant when the Participant dies); the Participant’s surviving children in equal shares; or the Participant’s estate.
		
	1.14.
	Disability or Disabled 

Disability or Disabled shall mean that the Participant (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve months; or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering Bank’s employees. The Committee may, in its discretion, rely on a determination by the Social Security Administration or an insurance carrier (if the definition of “disability” applied by the carrier is consistent with this section) in determining whether a Participant is Disabled, and may require the Participant to submit proof of such determination as a condition to becoming eligible for benefits.  The terms “Disabled” and “Disability” shall be interpreted consistently with Code Section 409A.
		
	1.15.
	Distribution Election Form 

Distribution Election Form means the form completed by a Participant to select the duration of deferral and the frequency of payments for Deferred Benefits.  
		
	1.16.
	Election Date 

Election Date means December 15 of any given Deferral Year and shall be the date before which an Eligible Executive must submit a valid Deferral Election Form to the Committee (provided, however, that the Election Date for the 2015 Deferral Year is ______________).  For an individual who becomes an Eligible Executive during a Deferral Year, the Election Date is the thirtieth day following the date that he or she becomes an Eligible Executive.  Despite the two preceding sentences, the Committee may set an earlier date as the Election Date for any Deferral Year with respect to all or part of an Eligible Executive’s Compensation.
		
	1.17.
	Eligible Executive 

Eligible Executive means an employee of the Bank who is a member of a select group of management or highly compensated employees (as such terms are defined in ERISA section 201(2)), and who is designated by the Committee as eligible to elect a Deferred Benefit.  Once an individual is so designated by the Committee, such employee shall continue to be an Eligible Executive until the date he or she is no longer a member of management or a highly compensated employee or the date the Committee declares he or she is no longer eligible to elect a Deferred Benefit.  
		
	1.18.
	For Cause

For Cause means any of the following actions by the Participant that may result in an adverse effect on the Bank:  (1) gross negligence or gross neglect; (2) the commission of a felony or gross misdemeanor involving fraud, or dishonesty; (3) the willful violation of any law, rule, or regulation (other than a traffic violation or similar offense); (4) an intentional failure to perform stated duties; or (5) a breach of fiduciary duty involving personal profit.  If a dispute arises as to whether Termination of Employment was For Cause, such dispute shall be resolved by arbitration as set forth in this Plan.  In addition, if a Participant breaches any post-termination obligation set forth in any agreement between the Participant and the Bank, including but not limited any covenant against competition, any covenant against solicitation of employees of the Bank or any prohibited disclosure of confidential information, the Participant’s Termination of Employment shall be deemed to be “For Cause” immediately upon the occurrence of the breach, as determined by the Committee in its sole and absolute discretion.
		
	1.19.
	Participant 

Participant means an employee of the Bank for whom a Deferral Account is maintained pursuant to the Plan and/or an Eligible Executive who has made an effective deferral election for a Deferral Year.
		
	1.20.
	Plan 

Plan means this Central Valley Community Bank Executive Deferred Compensation Plan.
1.21.    Termination of Employment or Terminates Employment
Termination of Employment means that a Participant’s employment with the Bank is terminated and the Participant actually separates from service with the Bank and does not continue in his or her prior capacity.  Notwithstanding the foregoing, a Participant’s employment shall be deemed to have terminated, and the Participant shall have suffered a Termination of Employment, when the Participant and Bank reasonably anticipate that the Participant will have a permanent reduction in the level of bona fide services provided to the Bank to a level of service that is less than fifty percent (50%) of the average level of bona fide services provided by the Participant to the Bank in the immediately preceding thirty-six (36) month period.  Termination of Employment does not include a Participant’s military leave, sick leave or other bona fide leave of absence (such as temporary employment with the government) if the period of leave does not exceed six months, or if longer, so long as the individual’s right to reemployment with the Bank is provided either in contract or statute.  Notwithstanding anything to the contrary, the terms “termination,” “termination of employment,” “terminates employment” and “employment termination” shall be interpreted consistently with Code Section 409A.  
		
	1.22.
	Unforeseeable Emergency

Unforeseeable Emergency means a severe financial hardship of the Participant resulting from an illness or accident of the Participant, or his or her spouse, dependent, or beneficiary; loss of the Participant’s property due to casualty (including the need to rebuild a home following damage to a home not otherwise covered by insurance, for example, not as a result of a natural disaster); or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant (such as the imminent foreclosure of or eviction from a primary residence, the need to pay for medical expenses, and the need to pay for the funeral expenses of a spouse or a dependent); provided however that any such event qualifies as an “unforeseeable emergency” within the meaning of Code Section 409A.
ARTICLE II     
DEFERRAL ELECTIONS
		
	2.01.
	Eligibility To Make Deferral Election

An individual may elect a Deferred Benefit for any Deferral Year if he or she is an Eligible Executive at the beginning of that Deferral Year or becomes an Eligible Executive during that Deferral Year.  Each Eligible Executive will be provided a Deferral Election Form by the Committee at least 45 days before the first day of a Deferral Year and each individual who becomes an Eligible Executive during a year will be provided a Deferral Election Form by the Committee within fifteen days after becoming an Eligible Executive.
		
	2.02.
	Deferral Elections

		
	(a)
	An Eligible Executive may elect to defer up to fifty percent (50%) of his or her Compensation for each Deferral Year.

		
	(b)
	A Deferral Election Form is effective when it is completed, signed by the electing Eligible Executive and received by the Committee.  The Eligible Executive becomes a Participant when a valid Deferral Election Form is received by the Committee, and will continue to be a Participant as long as a Deferral Account is maintained (or is required to be maintained under the terms of the Plan) for him or her.

		
	(c)
	Deferral Elections shall remain in effect for each succeeding Deferral Year, unless modified or canceled by a Participant on or before the next Election Date.

		
	(d)
	A Participant may not revoke a Deferral Election Form for a Deferral Year after the applicable Election Date.  Any writing signed by a Participant expressing the intention to revoke his or her Deferral Election Form, in whole or in part, and delivered to the Committee before the close of business on the applicable Election Date is a revocation.  

		
	(e)
	Notwithstanding the foregoing, in the event a Participant receives a distribution from the Plan due to an Unforeseeable Emergency, his or her deferral election will be cancelled with respect to any deferrals that would occur for the remainder of the Deferral Year after the Unforeseeable Emergency distribution.

		
	2.03.
	Rejection of Deferral Election

Prior to an Election Date, the Committee may, in its sole and absolute discretion, reject any Deferral Election Form.  The Committee must inform an affected Participant of a rejection promptly, and all rejections must be made on a uniform basis with respect to similarly situated Participants.  
ARTICLE III     
CREDITING DEFERRALS AND INTEREST TO DEFERRAL ACCOUNTS
		
	3.01.
	Deferrals

Deferrals shall be credited to the Participant’s Deferral Account as of the last day of the payroll period in which the deferred Compensation would have otherwise been paid to the Participant.
		
	3.02.
	Interest

Interest shall be credited on the balance in each Participant’s Deferral Account at the end of each Deferral Year and immediately prior to the commencement of benefit payments.  The interest rate for each year shall be determined by the Board in its sole and absolute discretion.  In the event of a Change In Control, the interest rate for any period following the Change In Control shall not be less than seventy-five percent (75%) of the average of the rates selected by the Board for the three (3) years prior to the Change In Control.
		
	3.03.
	Vesting and Forfeiture

Notwithstanding any Plan provision to the contrary, all Interest credited to a Participant’s Deferral Account shall be forfeited upon Termination of Employment For Cause.  Subject to the restrictions and limitations stated in Article V, a Participant’s deferred Compensation is always one hundred percent (100%) vested.
ARTICLE IV     
DISTRIBUTIONS
		
	4.01.
	Distribution Elections

On or before his or her initial Election Date, a Participant may complete a Distribution Election Form.  
		
	(a)
	A Participant may elect to have benefits payable on death, Disability or Termination of Employment paid in a lump sum or in annual installments over five or ten years.  In the absence of an election, benefits payable to a Participant or Designated Beneficiary shall be made in a lump sum. 

		
	(b)
	A Participant may also elect to have his or her account balance paid out in the event of a Change In Control, in a lump sum or in annual installments over five or ten years.   In the absence of an election to distribute benefits following a Change in Control, Deferred Benefits will be paid upon the Participant’s Termination of Employment, death or Disability. 

		
	(c)
	A Participant’s distribution election shall apply to all future deferrals and Deferred Benefits.  Distribution elections shall become irrevocable after the initial Election Date and may only be changed as permitted in Section 4.04 below.  If no Distribution Election Form is completed and returned on or before the initial Election Date, the Participant’s Deferred Benefits shall be paid in a lump sum on death, Disability or Termination of Employment (subject to changes in the form and timing of payment permitted under Section 4.04 below).  

		
	4.02.
	Commencement of Distributions

Payments to a Participant (or his or her Designated Beneficiary) shall begin as soon as practicable after the date of the Participant’s Termination of Employment, Disability, or death, or a Change In Control (as applicable), but no later than ninety (90) days following one of these payment events.   
		
	4.03.
	Medium of Payment

All distributions from the Plan shall be paid in cash.
		
	4.04.
	Changing Distribution Election

A Participant may change the time or form of payment elected on the Distribution Election Form by filing a new Distribution Election Form, subject to the following rules:
		
	(a)
	The modified election shall not be effective until 12 months after the date made;

		
	(b)
	For payments beginning as a result of the Participant’s Termination of Employment, payments beginning at a fixed time or on a fixed schedule, or payments due as a result of a Change in Control, the first payment due under the modified election must be deferred for a period of at least five years from the date such payment would have been made in the absence of the modified election; and

		
	(c)
	With respect to payments beginning at a fixed time or on a fixed schedule, a Participant must modify his or her distribution election at least 12 months prior to the first scheduled payment due under the Plan.  

		
	4.05.
	Unforeseeable Emergency Distributions

In its sole discretion and at the request of a Participant before or after the Participant’s Termination of Employment, the Committee may pay all or part of a Participant’s Deferred Benefits under this Plan on account of an Unforeseeable Emergency.  Distributions on account of an Unforeseeable Emergency will be limited to the amount reasonably necessary to satisfy the emergency need (which may include amounts necessary to pay any federal, state, or local income taxes or penalties reasonably anticipated to result from the distribution), as determined by the Committee.  In making this determination, the Committee will take into account any additional compensation that is available to the Participant.  Distributions on account of an Unforeseeable Emergency will not be allowed to the extent that such Unforeseeable Emergency may be relieved through reimbursement or compensation from insurance or otherwise, by liquidation of the Participant’s assets (to the extent liquidation of such assets would not cause severe financial hardship), or by cessation of deferrals under this Plan.  Distributions due to an Unforeseeable Emergency shall be made in accordance with Code Section 409A.
		
	4.06.
	Cashouts

The Committee may, in its discretion, require an immediate lump sum payment of amounts deferred under this Plan that do not exceed the applicable dollar amount under Code section 402(g)(1)(B) then in effect, provided that the payment results in the termination and liquidation of the entirety of the Participant’s interest under the Plan, including all agreements, methods, programs, or other arrangements with respect to which deferrals of compensation are treated as having been deferred. 
		
	4.07.
	Distributions to Specified Employees

		
	(a)
	Six-Month Delay

Notwithstanding any Plan provisions to the contrary, if a Participant is a Specified Employee as of the date of Termination of Employment, payments under the Plan upon Termination of Employment may not be made before the date that is six months after Termination of Employment (or, if earlier than the end of the six-month period, the date of death of the Participant).  Payments to which the Participant would otherwise be entitled during the first six months following Termination of Employment, but for this Six-Month Delay provision, shall be accumulated and paid on the first day of the seventh month following Termination of Employment.
		
	(b)
	Specified Employee

A Participant shall be deemed to be a “Specified Employee” if, as of the date of Participant’s Termination of Employment, he or she is an officer (within the meaning of Code Section 416(i)(1) and the regulations thereunder) of the Bank (including all entities that would be considered a single employer under Code section 414(b) or (c)), a director, or any other Participant whom the Bank determines is a specified employee within the meaning and according to the provisions of Code Section 409A(a)(2)(B)(i) and the regulations thereunder.
ARTICLE V     
RESTRICTIONS AND LIMITATIONS ON PAYMENT OF BENEFITS
		
	5.01.
	Excess Parachute Payments

Notwithstanding any Plan provision to the contrary, if all or a portion of any benefit payment under this Plan, alone or together with any other compensation or benefit, will be a non-deductible expense to the Bank or subject to excise tax by reason of Code sections 280G or 4999, the Bank shall reduce the compensation or benefits payable, including benefits payable under this Plan, as necessary to avoid the application of Section 280G.  The Bank shall have the power to reduce benefits payable under the Plan to zero, if necessary.
		
	5.02.
	Payment Restrictions

Notwithstanding any provisions of the Plan to the contrary, if any “payment restrictions” (as hereinafter defined) restrict payment or require the recapture or “clawback” of any benefits received by a Participant, the Bank shall not be obligated to pay and/or the Participant shall be required to repay such amounts to the Bank no later than thirty (30) days following Participant’s receipt of a written notice from the Bank indicating that benefits are subject to restrictions, recapture or clawback pursuant to the payment restrictions.  “Payment Restrictions” means any applicable state or federal statute, law, regulation, or regulatory interpretation or other guidance, or contractual arrangement with or required by a governmental authority that would restrict the Bank from paying benefits or require the Bank to seek or demand repayment or return of any benefits received by a Participant for any reason, including, without limitation, FIL-66-02010 and any related or successor regulatory guidance, any regulatory or enforcement interpretations or guidance provided by the Securities Exchange Commission or other regulatory body under Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, or the Bank or its successors later obtaining information indicating that the Participant has committed, is substantially responsible for, or has committed, the respective acts or omissions, conditions, or offenses outlined under 12 C.F.R. 359.4(a)(4).
Any Deferred Benefit under the Plan shall be subject to mandatory repayment by the Participant to the extent the Participant is, or in the future becomes, subject to (a) any Bank “clawback” or recoupment policy that is adopted to comply with the requirements of any applicable law, rule, regulation, or otherwise, or (b) any law, rule, or regulation which imposes mandatory recoupment, under circumstances set forth in such law, rule, or regulation.
To the extent that one or more exemptions are reasonably available to avoid Payment Restrictions and permit the payment of Deferred Benefits to a Participant, the Bank shall request exemption and permission to pay the Deferred Benefits in good faith, and shall make all reasonable efforts to obtain an exemption and/or permission to pay the Deferred Benefits in accordance with the Plan.
		
	5.03.
	Regulatory Compliance

The parties specifically acknowledge that while the restrictions contained in Section 131 of the Federal Deposit Insurance Corporation Improvement Act of 1991, relating to the payment of compensation for senior executive officers of institutions which are deemed “undercapitalized”, do not currently apply to the Bank such provisions may affect the crediting or payment of Deferred Benefits if the Bank should be deemed undercapitalized by any state or federal regulatory authority (including, without limitation, the Federal Deposit Insurance Company and the Federal Reserve Board) in the future.  Without limiting the generality of the foregoing, under no circumstances will the Bank be required to pay Deferred Benefits or take any other actions if such actions would result in any violation of applicable law, rule, regulation or regulatory directive.
ARTICLE VI     
RESTRICTIONS ON TRANSFER OF BENEFITS
		
	6.01.
	No Control or Alienation

Except as provided in this Article, a Participant has no control over Deferred Benefits except according to his or her Deferral Election Form, his or her Distribution Election Form, and his or her Beneficiary Designation Form.  No right or benefit under the Plan shall be subject to anticipation, alienation, sale, assignment, transfer, pledge, encumbrance or charge, and any attempt to do so shall be void.  No right or benefit hereunder shall in any manner be liable for or subject to the debts, contracts, liabilities, or torts of the person entitled to such benefit.
		
	6.02.
	Assignment of Benefits in Connection with Separation or Divorce

All or a portion of the Participant’s Deferral Account may be assigned and transferred to a spouse, former spouse or other dependent under the terms of a domestic relations order that meets the requirements set forth in Internal Revenue Code section 414(p)(1)(B).  The Committee shall determine, in its sole and absolute discretion, whether an assignment and transfer shall be made pursuant to the terms of a domestic relations order.  Upon assignment and transfer of all or any portion of a Participant’s Deferral Account, the amount assigned and transferred shall be distributed to the spouse, former spouse or other dependent, in one lump sum payment, as soon as administratively feasible.  Any assignment, transfer or payment to a spouse, former spouse or other dependent made pursuant to the terms of a domestic relations order shall be charged against and reduce the Participant’s Plan Deferral Account balance.  The Committee, the Board, the Bank, the Plan, or any other party shall not be liable in any manner to any person for complying with the terms of a domestic relations order.
ARTICLE VII     
AMENDMENT OR TERMINATION
Except as otherwise provided in this Article and only to the extent permitted by Code Section 409A, this Plan may be modified, amended, suspended, or terminated at any time by the Board.  The Board may not modify, amend, suspend, or terminate benefits under this Plan without the consent of the affected Participant(s) if that action would result either in a distribution of all Deferred Benefits in any manner other than as provided in this Plan or that would result in immediate taxation of Deferred Benefits to Participants.  
ARTICLE VIII     
ADMINISTRATION
		
	8.01.
	Committee

The Plan shall be administered by the Committee.  The Committee shall have the power to interpret and construe the Plan and to make all necessary determinations concerning the operation of the Plan and the payment of benefits hereunder.  The Committee’s interpretation and construction of any Plan provision shall be final and binding on all Participants and other parties.  Subject to the provisions of the Plan, the Committee may adopt such rules and regulations as may be necessary to carry out the purposes hereof.  
		
	8.02.
	Indemnification

The Bank shall indemnify and save harmless each member of the Committee and the Board against any and all expenses and liabilities arising out of membership on the Committee and the Board and relating to administration of the Plan, excepting only expenses and liabilities arising out of a member’s own willful misconduct.  Expenses against which a member of the Committee or the Board shall be indemnified hereunder shall include without limitation, the amount of any settlement or judgment, costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted, or a proceeding brought or settlement thereof.  The foregoing right of indemnification shall be in addition to any other rights to which any such member may be entitled.
		
	8.03.
	Eligibility Determinations

In addition to the express powers set forth in this Plan, the Committee shall have the power to select which employees of the Bank will be eligible to elect a Deferred Benefit under the Plan, to compute and certify the amount and kind of benefits from time to time payable to Participants and their Designated Beneficiaries under the Plan, to authorize all disbursements for such purposes, and to determine whether a Participant is entitled to a benefit under the Plan.
		
	8.04.
	Information to Committee

To enable the Committee to perform its functions, the Bank shall supply full and timely information to the Committee on all matters relating to the compensation of all Participants, their retirement, death or other cause for termination, and such other pertinent facts as the Committee may require.
		
	8.05.
	Notices

Notices and elections under this Plan must be in writing.  A notice or election is deemed delivered if it is delivered personally or if it is mailed by registered or certified mail to the person or business at his or her or its last known address.
		
	8.06.
	Waiver

The waiver of a breach of any provision in this Plan does not operate as and may not be construed as a waiver of any later breach.
8.07.    Claims
In the event a dispute arises with respect to Plan, the Executive or his beneficiaries may make a written claim to the Committee within sixty (60) days from the date payments are refused.  The Committee shall review the written claim and, if the claim is denied in whole or in part, shall respond in writing within sixty (60) days of receipt of such claim, stating specific reasons for the denial, and providing references to the Plan provisions upon which the denial is based and any additional material or information necessary to perfect the claim.  Such written notice shall further indicate the additional steps to be taken by claimant(s) if a further review of the claim is desired.  A claim shall be deemed denied if the Committee fails to take any action within the prescribed sixty (60) day period.
If claimants desire a second review they shall notify the Committee in writing within sixty (60) days of the initial claim denial.  Claimants may review the Plan or any documents relating to the claim and shall submit any written issues and comments that may be appropriate.  The Board, in its sole discretion, shall review the claim and provide a written decision within sixty (60) days of receipt of such claim.  This decision shall likewise state the specific reasons for the decision and shall include references to specific Plan provisions upon which the decision is based.
If claimants continue to dispute a benefit denial, then claimants may submit the dispute to an arbitrator for final arbitration.  The arbitrator shall be selected by mutual agreement of the Bank and the claimants.  The arbitrator shall operate under any generally recognized set of arbitration rules.  The parties, their heirs, personal representatives, successors and assigns shall be bound by the decision of such arbitrator with respect to any controversy properly submitted to it for determination.
Where a dispute arises as to benefits forfeited as a result of the Bank’s discharge of the Executive For Cause, such dispute shall likewise be submitted to arbitration as described above and the Parties agree to be bound by the arbitrator’s decision.
ARTICLE IX     
GENERAL
		
	9.01.
	Plan Creates No Separate Rights

The Plan does not in any way limit the right of the Bank at any time and for any reason to terminate the employment of a Participant in its employ.  In no event shall the Plan, by its terms or by implication, constitute an employment contract of any nature whatsoever between the Bank and a Participant.
		
	9.02.
	Unfunded Status Of Plan

		
	(c)
	All Plan Participants and Designated Beneficiaries are general unsecured creditors of the Bank with respect to the benefits due hereunder and the Plan constitutes a mere promise by the Bank to make benefit payments in the future.  It is the intention of the Bank that the Plan be considered unfunded for tax purposes and for purposes of ERISA Title I.

		
	(d)
	The Bank may purchase life insurance in amounts sufficient to secure the benefits provided under this Plan.

		
	(e)
	The Bank may establish a grantor trust which may be used to hold assets of the Bank which are maintained as reserves against the Bank’s unfunded, unsecured obligations hereunder.  Such reserves shall at all times be subject to the claims of the Bank’s creditors and the creditors of any affiliate of the Bank that is also an Bank of a Participant.  To the extent such trust or other vehicle is established the Bank’s obligations hereunder shall be reduced to the extent such assets are utilized to meet its obligations hereunder.  Any such trust and the assets held thereunder are intended to conform in substance to the terms of the model trust described in Revenue Procedure 92-64, 1992-33 IRB 11 (8-17-92).  

		
	9.03.
	Plan Binding

The Plan shall be binding upon the Bank, and its successors and assigns and upon a Participant, his or her Designated Beneficiary(ies), or any of their assigns, heirs, executors and administrators.
		
	9.04.
	Interpretation of Plan

To the extent not preempted by federal law, the Plan shall be governed and construed under the laws of the state of California (other than its choice of law rules) as in effect from time to time. Notwithstanding any provision to the contrary, this Plan shall be interpreted and construed to comply with Code Section 409A and the applicable provisions of ERISA.
		
	9.05.
	Construction

Headings and captions are only for convenience; they do not have substantive meaning.  If a provision of this Plan is not valid or not enforceable, that fact in no way affects the validity or enforceability of any other provision.  Use of one gender includes both, and the singular and plural include each other.
Dated this 21st day of     October    2015.
Bank:

CENTRAL VALLEY COMMUNITY BANK

By:     /s/Daniel J. Doyle             
Name:     Daniel J. Doyle        
Title:     Chairman                 

{00361047/4}    3biei_ex1046.htm

EXHIBIT 10.46
  

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.
 
Original Issue Date: March 11, 2016
 
$105,000.00
 
10% CONVERTIBLE PROMISSORY NOTE
DUE DECEMBER 11, 2016
 
THIS 10% CONVERTIBLE PROMISSORY NOTE is one of a series of duly authorized and validly issued 10% Convertible Promissory Notes of Premier Biomedical Inc. (the "Company"), having its principal place of business at P.O. Box 31374, El Paso, TX 79930, designated as its 10% Convertible Notes due December 11, 2016 (this Note, the "Note" and, collectively with the other Notes of such series, the "Notes").
 
	 
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FOR VALUE RECEIVED, the Company promises to pay, in cash, to Redwood Management, LLC or its registered assigns (the "Holder"), or shall have paid pursuant to the terms hereunder, the principal sum of $105,000.00 on December 11, 2016 (the "Maturity Date") or such earlier date as this Note 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 Note in accordance with the provisions hereof. This Note is subject to the following additional provisions:
 
Section 1. Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Note, (a) capitalized terms not otherwise defined herein shall have the meanings set forth in the Purchase Agreement and (b) the following terms shall have the following meanings:
 
"Alternate Consideration" shall have the meaning set forth in Section 5(d).
 
"Alternative Conversion Price" means 50% of the lowest traded price of the Common Stock in the fifteen (15) Trading Days prior to the Conversion Date.
 
"Bankruptcy Event" means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) thereof commences a case or other proceeding under any bankruptcy, reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the Company or any Significant Subsidiary thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof any such case or proceeding that is not dismissed within 60 days after commencement, (c) the Company or any Significant Subsidiary thereof is adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or proceeding is entered, (d) the Company or any Significant Subsidiary thereof suffers any appointment of any custodian or the like for it or any substantial part of its property that is not discharged or stayed within 60 calendar days after such appointment, (e) the Company or any Significant Subsidiary thereof makes a general assignment for the benefit of creditors, (f) the Company or any Significant Subsidiary thereof calls a meeting of its creditors with a view to arranging a composition, adjustment or restructuring of its debts or (g) the Company or any Significant Subsidiary thereof, by any act or failure to act, expressly indicates its consent to, approval of or acquiescence in any of the foregoing or takes any corporate or other action for the purpose of effecting any of the foregoing.
 
	 
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"Base Conversion Price" shall have the meaning set forth in Section 5(b).
 
"Beneficial Ownership Limitation" shall have the meaning set forth in Section 4(d). 
 
"Buy-In" shall have the meaning set forth in Section 4(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% of the voting securities of the Company (other than by means of conversion or exercise of the Notes and the Securities issued together with the Notes), (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% 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% of the aggregate voting power of the acquiring entity immediately after the transaction, or (d) 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 (c) above.
 
"Conversion" shall have the meaning ascribed to such term in Section 4. 
 
"Conversion Date" shall have the meaning set forth in Section 4(a).
 
"Conversion Price" shall have the meaning set forth in Section 4(b).
 
"Conversion Schedule" means the Conversion Schedule in the form of Schedule 1 attached hereto.
 
"Conversion Shares" means, collectively, the shares of Common Stock issuable upon conversion of this Note in accordance with the terms hereof.
 
	 
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"Dilutive Issuance" shall have the meaning set forth in Section 5(b).
 
"Dilutive Issuance Notice" shall have the meaning set forth in Section 5(b).
 
"DTC" means the Depository Trust Company.
 
"DTC/FAST Program" means the DTC's Fast Automated Securities Transfer Program.
 
"DWAC Eligible" means that (a) the Common Stock is eligible at DTC for full services pursuant to DTC's Operational Arrangements, (b) the Company has been approved (without revocation) by the DTC's underwriting department, (c) the Transfer Agent is approved as an agent in the DTC/FAST Program, and (d) the Transfer Agent does not have a policy prohibiting or limiting delivery of the Conversion Shares via DWAC.
 
"Event of Default" shall have the meaning set forth in Section 6(a).
  
"Fundamental Transaction" shall have the meaning set forth in Section 5(d). 
 
"Late Fees" shall have the meaning set forth in Section 2(c).
 
"Mandatory Default Amount" means the payment of 130% of the outstanding principal amount of this Note and accrued and unpaid interest hereon, in addition to the payment of all other amounts, costs, expenses and liquidated damages due in respect of this Note.
 
"New York Courts" shall have the meaning set forth in Section 7(d).
 
	 
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"Note Register" shall have the meaning set forth in Section 2(b).
 
"Notice of Conversion" shall have the meaning set forth in Section 4(a).
    
"Original Issue Date" means the date of the first issuance of this Note, regardless of any transfers of any Note and regardless of the number of instruments which may be issued to evidence such Notes.
 
"Purchase Agreement" means the Securities Purchase Agreement, dated as of December 28, 2015 between the Company and the original Holder, as amended, modified or supplemented from time to time in accordance with its terms.
 
"Registration Rights Agreement" means the Registration Rights Agreement, dated as of the date of the Purchase Agreement, among the Company and the original Holders, in the form of Exhibit B attached to the Purchase Agreement.
 
"Registration Statement" means a registration statement covering the resale of the Underlying Shares by each Holder.
 
"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
 
"Share Delivery Date" shall have the meaning set forth in Section 4(c)(ii).
 
"Successor Entity" shall have the meaning set forth in Section 5(d). 
  
Section 2. Interest. 
 
a)  Payment of Interest in Cash or Kind. The Company shall pay interest to the Holder on the aggregate unconverted and then outstanding principal amount of this Note at the rate of 10% per annum, which interest amount shall be guaranteed. All interest payments hereunder will be payable in cash or Common Stock in the Holder's discretion. Accrued and unpaid interest shall be due and payable on each Conversion Date and on the Maturity Date, or as otherwise set forth herein.
 
	 
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b) Interest Calculations. Interest shall be calculated on the basis of a 360-day year, consisting of twelve 30 calendar day periods, and shall accrue daily commencing on the Original Issue Date until payment in full of the outstanding principal, together with all accrued and unpaid interest, liquidated damages and other amounts which may become due hereunder, has been made. Interest hereunder will be paid to the Person in whose name this Note is registered on the records of the Company regarding registration and transfers of this Note (the "Note Register").
 
c) Late Fee. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate equal to the lesser of 18% per annum or the maximum rate permitted by applicable law (the "Late Fees") which shall accrue daily from the date such interest is due hereunder through and including the date of actual payment in full. 
 
d) Prepayment. At any time upon ten (10) days written notice to the Holder, the Company may prepay any portion of the principal amount of this Note and any accrued and unpaid interest. If the Company exercises its right to prepay the Note, the Company shall make payment to the Holder of an amount in cash equal to the sum of the then outstanding principal amount of this Note and interest multiplied by 130%. The Holder may continue to convert the Note from the date notice of the prepayment is given until the date of the prepayment.
 
Section 3.Registration of Transfers and Exchanges. 
 
a) Different Denominations. This Note is exchangeable for an equal aggregate principal amount of Notes of different authorized denominations, as requested by the Holder surrendering the same. No service charge will be payable for such registration of transfer or exchange.
 
b) Investment Representations. This Note has been issued subject to certain investment representations of the original Holder set forth in the Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and applicable federal and state securities laws and regulations. 
 
c) Reliance on Note Register. Prior to due presentment for transfer to the Company of this Note, the Company and any agent of the Company may treat the Person in whose name this Note is duly registered on the Note Register as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note is overdue, and neither the Company nor any such agent shall be affected by notice to the contrary.
 
	 
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Section 4.Conversion.
 
a) Voluntary Conversion. At any time after ninety (90) days after the date of this Note, this Note shall be convertible, in whole or in part, into shares of Common Stock at the option of the Holder, from time to time (subject to the conversion limitations set forth in Section 4(d) 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 Note to be converted and the date on which such conversion shall be effected (such date, the "Conversion Date"). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion is deemed delivered hereunder. No ink-original Notice of Conversion shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Conversion form be required.To effect conversions hereunder, the Holder shall not be required to physically surrender this Note to the Company unless the entire principal amount of this Note, plus all accrued and unpaid interest thereon, has been so converted. Conversions hereunder shall have the effect of lowering the outstanding principal amount of this Note in an amount equal to the applicable conversion. The Holder and the Company shall maintain a Conversion Schedule showing the principal amount(s) converted and the date of such conversion(s). The Company may deliver an objection to any Notice of Conversion within one (1) Business Day of delivery of such Notice of Conversion. In the event of any dispute or discrepancy, the records of the Holder shall be controlling and determinative in the absence of manifest error. The Holder, and any assignee by acceptance of this Note, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted principal amount of this Note may be less than the amount stated on the face hereof. 
 
b) Conversion Price. The conversion price (the "Conversion Price") in effect on any Conversion Date shall be equal to 60% of the lowest traded price of the Common Stock in the fifteen (15) Trading Days prior to the Conversion Date; provided that, except in the event the Alternative Conversion Price is applicable pursuant to the following sentence, the Conversion Price shall not be lower than $0.00005. Notwithstanding anything herein to the contrary, at any time after the occurrence of any Event of Default the Holder may require the Company to, at such Holder's option and otherwise in accordance with the provisions for conversion herein, convert all or any part of this Note into Common Stock at the Alternative Conversion Price. All such foregoing determinations will be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction that proportionately decreases or increases the Common Stock during such measuring period. Nothing herein shall limit a Holder's right to pursue actual damages or declare an Event of Default pursuant to Section 6 hereof and the Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law.   

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

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 date on which such Conversion Shares are eligible to be sold under Rule 144 without the need for current public information and the Company has received an opinion of counsel to such effect reasonably acceptable to the Company (which opinion the Company will be responsible for obtaining) shall be free of restrictive legends and trading restrictions (other than those which may then be required by the Purchase Agreement) representing the number of Conversion Shares being acquired upon the conversion of this Note, and (B) payment in the amount of accrued and unpaid interest (if the Company has elected or is required to pay accrued interest in cash). All certificate or certificates required to be delivered by the Company under this Section 4(d) shall be delivered electronically through the Depository Trust Company or another established clearing corporation performing similar functions. If the Conversion Date is prior to the date on which such Conversion Shares are eligible to be sold under Rule 144 without the need for current public information the Conversion Shares shall bear a restrictive legend in substantially the following form, as appropriate:
  
	 
	"NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES."
	 

	 
	 
	 

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

 
	 
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iii. Failure to Deliver Certificates. If, in the case of any Notice of Conversion, such certificate or certificates are not delivered to or as directed by the applicable Holder by the Share Delivery Date, the Holder shall be entitled to elect by written notice to the Company at any time on or before its receipt of such certificate or certificates, to rescind such Conversion, in which event the Company shall promptly return to the Holder any original Note delivered to the Company and the Holder shall promptly return to the Company the Common Stock certificates issued to such Holder pursuant to the rescinded Conversion Notice. 
 
iv. Obligation Absolute; Partial Liquidated Damages. The Company's obligations to issue and deliver the Conversion Shares upon conversion of this Note in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation of the Company to the Holder in connection with the issuance of such Conversion Shares; provided, however, that such delivery shall not operate as a waiver by the Company of any such action the Company may have against the Holder. In the event the Holder of this Note shall elect to convert any or all of the outstanding principal or interest amount hereof, the Company may not refuse conversion based on any claim that the Holder or anyone associated or affiliated with the Holder has been engaged in any violation of law, agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining and or enjoining conversion of all or part of this Note shall have been sought and obtained, and the Company posts a surety bond for the benefit of the Holder in the amount of 150% of the outstanding principal amount of this Note, which is subject to the injunction, which bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of which shall be payable to the Holder to the extent it obtains judgment. In the absence of such injunction, the Company shall issue Conversion Shares or, if applicable, cash, upon a properly noticed conversion. If the Company fails for any reason to deliver to the Holder such certificate or certificates pursuant to Section 4(c)(ii) by the Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, $1000 per Trading Day for each Trading Day after such Share Delivery Date until such certificates are delivered or Holder rescinds such conversion. Nothing herein shall limit a Holder's right to pursue actual damages or declare an Event of Default pursuant to Section 6 hereof for the Company's failure to deliver Conversion Shares within the period specified herein and the Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law.
 
	 
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v. Compensation for Buy-In on Failure to Timely Deliver Certificates Upon Conversion. In addition to any other rights available to the Holder, if the Company fails for any reason to deliver to the Holder such certificate or certificates by the Share Delivery Date pursuant to Section 4(c)(ii), and if after such Share Delivery Date the Holder is required by its brokerage firm to purchase (in an open market transaction or otherwise), or the Holder's brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Conversion Shares which the Holder was entitled to receive upon the conversion relating to such Share Delivery Date (a "Buy-In"), then the Company shall (A) pay in cash to the Holder (in addition to any other remedies available to or elected by the Holder) the amount, if any, by which (x) the Holder's total purchase price (including any brokerage commissions) for the Common Stock so purchased exceeds (y) the product of (1) the aggregate number of shares of Common Stock that the Holder was entitled to receive from the conversion at issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the option of the Holder, either reissue (if surrendered) this Note in a principal amount equal to the principal amount of the attempted conversion (in which case such conversion shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued if the Company had timely complied with its delivery requirements under Section 4(c)(ii). For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion of this Note with respect to which the actual sale price of the Conversion Shares (including any brokerage commissions) giving rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder's right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company's failure to timely deliver certificates representing shares of Common Stock upon conversion of this Note as required pursuant to the terms hereof.
 
vi. Reservation of Shares Issuable Upon Conversion. The Company covenants that it will, beginning with the earlier of the Effectiveness Date (as defined in the Registration Rights Agreement) or the Rule 144 Date (as defined in the Purchase Agreement), at all times reserve and keep available out of its authorized and unissued shares of Common Stock a number of shares of Common Stock at least equal to 300% of the Required Minimumfor the sole purpose of issuance upon conversion of this Note and payment of interest on this Note, each as herein provided, free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holder (and the other holders of the Notes), not less than such aggregate number of shares of the Common Stock as shall (subject to the terms and conditions set forth in the Purchase Agreement) be issuable (taking into account the adjustments and restrictions of Section 5) upon the conversion of the then outstanding principal amount of this Note and payment of interest hereunder. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and nonassessable.
 
vii. Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion of this Note. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion, the Company shall at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price or round up to the next whole share.
 
viii. Transfer Taxes and Expenses. The issuance of certificates for shares of the Common Stock on conversion of this Note shall be made without charge to the Holder hereof for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificates, provided that, the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the Holder of this Note so converted and the Company shall not be required to issue or deliver such certificates unless or until the Person or Persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Conversion.
 
	 
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d) Holder's Conversion Limitations. The Company shall not effect any conversion of principal and/or interest of this Note, and a Holder shall not have the right to convert any principal and/or interest of this Note, to the extent that after giving effect to the conversion set forth on the applicable Notice of Conversion, the Holder (together with the Holder's Affiliates, and any Persons acting as a group together with the Holder or any of the Holder's Affiliates) would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon conversion of this Note with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable upon (i) conversion of the remaining, unconverted principal amount of this Note beneficially owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion or exercise analogous to the limitation contained herein (including, without limitation, any other Notes) beneficially owned by the Holder or any of its Affiliates. Except as set forth in the preceding sentence, for purposes of this Section 4(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. To the extent that the limitation contained in this Section 4(d) applies, the determination of whether this Note is convertible (in relation to other securities owned by the Holder together with any Affiliates) and of which principal amount of this Note is convertible shall be in the sole discretion of the Holder, and the submission of a Notice of Conversion shall be deemed to be the Holder's determination of whether this Note may be converted (in relation to other securities owned by the Holder together with any Affiliates) and which principal amount of this Note is convertible, in each case subject to the Beneficial Ownership Limitation. To ensure compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a Notice of Conversion that such Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 4(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 Note, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The "Beneficial Ownership Limitation" shall be 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 Note held by the Holder. The Holder, upon not less than 61 days' prior notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 4(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon conversion of this Note held by the Holder and the Beneficial Ownership Limitation provisions of this Section 4(e) shall continue to apply. Any such increase or decrease will not be effective until the 61st day after such notice is delivered to the Company. The Beneficial Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 4(d) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Note.
 
	 
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Section 5. Certain Adjustments.
 
a) Stock Dividends and Stock Splits. If the Company, at any time while this Note is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any Common Stock Equivalents (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon conversion of, or payment of interest on, the Notes), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues, in the event of a reclassification of shares of the Common Stock, any shares of capital stock of the Company, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding any treasury shares of the Company) outstanding immediately before such event, and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re classification.
  
b) Subsequent Equity Sales. If, at any time while this Note is outstanding, the Company or any Subsidiary, as applicable, sells or grants any option to purchase or sells or grants any right to reprice, or otherwise disposes of or issues (or announces any sale, grant or any option to purchase or other disposition), any Common Stock or Common Stock Equivalents entitling any Person to acquire shares of Common Stock at an effective price per share that is lower than the then Conversion Price (such lower price, the "Base Conversion Price" and such issuances, collectively, a "Dilutive Issuance") (if the holder of the Common Stock or Common Stock Equivalents so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled to receive shares of Common Stock at an effective price per share that is lower than the 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. 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 will be 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.
 
c) Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 5(a) above, if at any time the Company grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of shares of Common Stock (the "Purchase Rights"), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete conversion of this Note (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder's right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
 
	 
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d) Fundamental Transaction. If, at any time while this Note is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, (v) the Company, directly or indirectly, in one or more related transactionsconsummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby such other Person acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a "Fundamental Transaction"), then, upon any subsequent conversion of this Note, the Holder shall have the right to receive, for each Conversion Share that would have been issuable upon such conversion immediately prior to the occurrence of such Fundamental Transaction (without regard to any limitation in Section 4(e) on the conversion of this Note), the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the "Alternate Consideration") receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Note is convertible immediately prior to such Fundamental Transaction (without regard to any limitation in Section 4(d) on the conversion of this Note). For purposes of any such conversion, the determination of the Conversion Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one (1) share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Conversion Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any conversion of this Note following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the "Successor Entity") to assume in writing all of the obligations of the Company under this Note and the Purchase Agreement in accordance with the provisions of this Section 5(d) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the holder of this Note, deliver to the Holder in exchange for this Note a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Note which is convertible for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon conversion of this Note (without regard to any limitations on the conversion of this Note) prior to such Fundamental Transaction, and with a conversion price which applies the conversion price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such conversion price being for the purpose of protecting the economic value of this Note immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and the other Transaction Documents referring to the "Company" shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Note and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.
 
e) 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.   

 
	 
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f) Notice to the Holder.
 
i. Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section 5, the Company shall promptly deliver to each Holder a notice setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment. 
 
ii. Notice to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be filed at each office or agency maintained for the purpose of conversion of this Note, and shall cause to be delivered to the Holder at its last address as it shall appear upon the Note Register, at least twenty (20) calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange, provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to convert this Note during the 20-day period commencing on the date of such notice through the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.   

 
	 
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Section 6. Events of Default. 
 
a) "Event of Default" means, wherever used herein, any of the following events (whatever the reason for such event and whether such event shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order, rule or regulation of any administrative or governmental body):
 
i. any default in the payment of (A) the principal amount of any Note or (B) interest, liquidated damages and other amounts owing to a Holder on any Note, as and when the same shall become due and payable (whether on a Conversion Date or the Maturity Date or by acceleration or otherwise) which default, solely in the case of an interest payment or other default under clause (B) above, is not cured within 3 Trading Days;
 
 ii. the Company shall materially fail to observe or perform any other material covenant or material agreement contained in the Notes (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 (ix) below) which failure is not cured, if possible to cure, within the earlier to occur of (A) 5 Trading Days after notice of such failure sent by the Holder or by any other Holder to the Company and (B) 10 Trading Days after the Company has become or should have become aware of such failure;
 
iii. a default or event of default (subject to any grace or cure period provided in the applicable agreement, document or instrument) shall occur under (A) any of the Transaction Documents or (B) any other material agreement, lease, document or instrument to which the Company or any Subsidiary is obligated (and not covered by clause (vi) below);
 
iv. any representation or warranty made in this Note, any other Transaction Documents, any written statement pursuant hereto or thereto or any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be untrue or incorrect in any material respect as of the date when made or deemed made;
 
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; 
 
	 
	15

	

	 

  
vii. the Common Stock shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible to resume listing or quotation for trading thereon within five Trading Days or the transfer of shares of Common Stock through the Depository Trust Company System is no longer available or "chilled";
 
viii. the Company shall be a party to any Change of Control Transaction or Fundamental Transaction or shall agree to sell or dispose of all or in excess of 50% 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 does not meet the current public information requirements under Rule 144 in respect of the Registrable Securities (as defined in the Registration Rights Agreement);
 
x. if, during the Effectiveness Period (as defined in the Registration Rights Agreement), either (a) the effectiveness of the Registration Statement lapses for any reason or (b) the Holder shall not be permitted to resell Registrable Securities (as defined in the Registration Rights Agreement) under the Registration Statement for a period of more than 20 consecutive Trading Days or 30 non-consecutive Trading Days during any 12 month period; provided, however, that if the Company is negotiating a merger, consolidation, acquisition or sale of all or substantially all of its assets or a similar transaction and, in the written opinion of counsel to the Company, the Registration Statement would be required to be amended to include information concerning such pending transaction(s) or the parties thereto which information is not available or may not be publicly disclosed at the time, the Company shall be permitted an additional 10 consecutive Trading Days during any 12 month period pursuant to this Section 6(a)(x);
 
xi. the Company shall fail for any reason to deliver certificates to a Holder on or prior to the third Trading Day after a Conversion Date pursuant to Section 4(c) or the Company shall provide at any time notice to the Holder, including by way of public announcement, of the Company's intention to not honor requests for conversions of any Notes in accordance with the terms hereof; 
 
xii. the Company fails to file with the Commission any required reports under Section 13 or 15(d) of the Exchange Act such that it is not in compliance with Rule 144(c)(1) (or Rule 144(i)(2), if applicable);
 
xiii. if the Company or any Significant Subsidiary shall: (i) apply for or consent to the appointment of a receiver, trustee, custodian or liquidator of it or any of its properties, (ii) admit in writing its inability to pay its debts as they mature, (iii) make a general assignment for the benefit of creditors, (iv) be adjudicated bankrupt or insolvent or be the subject of an order for relief under Title 11 of the United States Code or any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or liquidation law or statute of any other jurisdiction or foreign country, or (v) file a voluntary petition in bankruptcy, or a petition or an answer seeking reorganization or an arrangement with creditors or to take advantage or any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution or liquidation law or statute, or an answer admitting the material allegations of a petition filed against it in any proceeding under any such law, or (vi) take or permit to be taken any action in furtherance of or for the purpose of effecting any of the foregoing;
 
	 
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xiv. if any order, judgment or decree shall be entered, without the application, approval or consent of the Company or any Significant Subsidiary, by any court of competent jurisdiction, approving a petition seeking liquidation or reorganization of the Company or any Subsidiary, or appointing a receiver, trustee, custodian or liquidator of the Company or any Subsidiary, or of all or any substantial part of its assets, and such order, judgment or decree shall continue unstayed and in effect for any period of sixty (60) days;
 
xv. the occurrence of any levy upon or seizure or attachment of, or any uninsured loss of or damage to, any property of the Company or any Subsidiary having an aggregate fair value or repair cost (as the case may be) in excess of $100,000 individually or in the aggregate, and any such levy, seizure or attachment shall not be set aside, bonded or discharged within thirty (30) days after the date thereof;
 
xvi. the Company shall fail to maintain sufficient reserved shares pursuant to Section 4(c)(vi);
 
xvii.  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 $100,000, and such judgment, writ or similar final process shall remain unvacated, unbonded or unstayed for a period of 45 calendar days; or 
 
xviii. the Company has not filed a Schedule 14C with the Commission to increase the number of authorized shares of Common Stock to a number reasonably acceptable to the Holder within thirty (30) days after the first Closing Date and has not used its reasonable best efforts to cause such increase to become effective.

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

 
	 
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Section 7. Miscellaneous. 

a) Notices. Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without limitation, any Notice of Conversion, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service, addressed to the Company, at the address set forth above, or such other facsimile number or address as the Company may specify for such purposes by notice to the Holder delivered in accordance with this Section 7(a). Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number or address of the Holder as set forth in the Purchase Agreement or as appearing on the books of the Company, or such other facsimile number or address as the Holder may specify for such purposes by notice to the Company delivered in accordance with this Section 7(a). Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto prior to 12:00 p.m. (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 12:00 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.
 
b) Absolute Obligation. Except as expressly provided herein, no provision of this Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable, on this Note at the time, place, and rate, and in the coin or currency, herein prescribed. This Note is a direct debt obligation of the Company. This Note ranks paripassu with all other Notes now or hereafter issued under the terms set forth herein. 
 
c) Lost or Mutilated Note. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, reasonably satisfactory to the Company.   

 
	 
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d) Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be governed by and construed and enforced in accordance with the internal laws of the State of 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 Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Note or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any provisions of this Note, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.
 
e) Waiver. Any waiver by the Company or the Holder of a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Company or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note on any other occasion. Any waiver by the Company or the Holder must be in writing. 
 
f) Severability. If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable law. The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company from paying all or any portion of the principal of or interest on this Note as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Note, and the Company (to the extent it may lawfully do so) hereby expressly waives all benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Holder, but will suffer and permit the execution of every such as though no such law has been enacted.   

 
	 
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g) Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Note shall be cumulative and in addition to all other remedies available under this Note and any of the other Transaction Documents at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the Holder's right to pursue actual and consequential damages for any failure by the Company to comply with the terms of this Note. The Company covenants to the Holder that there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by the Holder and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled, in addition to all other available remedies, to an injunction restraining any such breach or any such threatened breach, without the necessity of showing economic loss and without any bond or other security being required. The Company shall provide all information and documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company's compliance with the terms and conditions of this Note.
 
h) Next Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day.
 
i) Headings. The headings contained herein are for convenience only, do not constitute a part of this Note and shall not be deemed to limit or affect any of the provisions hereof.
 
*********************
(Signature Pages Follow)

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

	 	 	 	 
		By:	/s/ William A. Hartman 	 

	 
	Name: 
	William A. Hartman 	 

	 
	Title: 
	President	 

	 
	Facsimile No. for delivery of Notices: _______________
	 

 
	 
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ANNEX A
 
NOTICE OF CONVERSION
 
The undersigned hereby elects to convert principal under the 10% Convertible Promissory Note due December 11, 2016 of Premier Biomedical Inc.(the "Company"), into shares of common stock (the "Common Stock"), of the Company according to the conditions hereof, as of the date written below. If shares of Common Stock are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder for any conversion, except for such transfer taxes, if any. 
 
By the delivery of this Notice of Conversion the undersigned represents and warrants to the Company that its ownership of the Common Stock does not exceed the amounts specified under Section 4 of this Note, as determined in accordance with Section 13(d) of the Exchange Act.
 
The undersigned agrees to comply with the prospectus delivery requirements under the applicable securities laws in connection with any transfer of the aforesaid shares of Common Stock. 
 
Conversion calculations: 
 
	 
	Date to Effect Conversion:

	 
	 

	 
	Principal Amount of Note to be Converted: 

	 
	 

	 
	Payment of Interest in Common Stock __ yes __ no 

	 
	If yes, $_____ of Interest Accrued on Account of Conversion at Issue. 

	 
	 

	 
	Number of shares of Common Stock to be issued: 

	 
	 

	 
	Signature: 

	 
	 

	 
	Name: 

	 
	 

	 
	Delivery Instructions: 

 
	 
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Schedule 1
 
CONVERSION SCHEDULE
 
This 10% Convertible Promissory Note due on December 11, 2016 in the original principal amount of $105,000 is issued by Premier Biomedical Inc.This Conversion Schedule reflects conversions made under Section 4 of the above referenced Note.
 
Dated: 
 
	Date of Conversion
(or for first entry, Original Issue Date)
	Amount of Conversion
	Aggregate Principal Amount Remaining Subsequent to Conversion
(or original Principal Amount)
	Company Attest

				
				
				
				
				
				
				
				
				

  
 
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