Document:

Exhibit 10.25

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

THIS AGREEMENT (“Agreement”) is made as of the 14th day of August, 2018, between ACNB Corporation (“Corporation”), a Pennsylvania business corporation having a principle place of business at 16 Lincoln Square, Gettysburg, Pennsylvania, 17325, ACNB BANK (“Bank”), a Pennsylvania state-chartered bank having a principle place of business at 16 Lincoln Square, Gettysburg, Pennsylvania, 17325, and James P. Helt (“Executive”), an individual residing in Pennsylvania.

 

WITNESSETH:

 

WHEREAS, the Bank is a subsidiary of the Corporation;

 

WHEREAS, on April 15, 2009, Executive entered into an employment agreement with the Bank, which was amended on December 27, 2016 (“2009 Employment Agreement”);

 

WHEREAS, in addition to previously being named President of the Bank, effective May 5, 2017, Executive was also appointed President and Chief Executive Officer of the Corporation and Chief Executive Officer of the Bank; and

 

WHEREAS, the parties would like to enter into an amended and restated employment agreement to reflect the change in Executive’s position, at which time the 2009 Employment Agreement and any amendments thereto will be null and void and without further effect.

 

AGREEMENT:

 

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

 

1.                                      Employment.

 

The Bank hereby employs Executive and Executive hereby accepts employment with the Bank, under the terms and conditions set forth in this Agreement.

 

2.                                      Duties of Executive.  Executive shall serve as the President and Chief Executive Officer of the Corporation and the Bank reporting only to the Board of Directors.  Executive shall have such other duties and hold such other titles as may be given to him from time to time by the Board of Directors provided that such duties are consistent with the Executive’s position as President and Chief Executive Officer.

 

3.                                      Engagement in Other Employment.  Executive shall devote all of his working time, ability and attention to the business of the Bank and/or its subsidiaries or affiliates during the term of this Agreement.  The Executive shall notify the Board of Directors of the Bank in writing before the Executive engages in any other business or commercial duties or pursuits, including but not limited to, directorships of other companies.  Under no circumstances may the Executive engage in any business or commercial activities, duties or pursuits which compete with the business or commercial activities of the Corporation, the Bank and/or any of their subsidiaries or affiliates, nor may the Executive serve as a director or officer or in any other capacity in a company which competes with the Corporation, the Bank and/or any of their subsidiaries or affiliates.

 

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Executive shall not be precluded, however, upon written notification to the Board of Directors, from engaging in voluntary or philanthropic endeavors, from engaging in activities designed to maintain and improve his professional skills, or from engaging in activities incident or necessary to personal investments, so long as they are, in the Board’s reasonable opinion, not in conflict with or detrimental to the Executive’s rendition of services on behalf of the Corporation, the Bank and/or any of their subsidiaries or affiliates.

 

4.                                      Term of Agreement.

 

(a)                                 This Agreement shall be for a three (3) year period (the “Employment Period”) beginning on the date first written above, and if not previously terminated pursuant to the terms of this Agreement, the Employment Period shall end three (3) years later (the “Initial Term”).  The Employment Period shall be extended automatically for one (1) additional year on the first annual anniversary date of the commencement of the Initial Term (the date first above written), and then on each anniversary date of this Agreement thereafter, unless the Bank or Executive gives contrary written notice to the other not less than one hundred eighty (180) days before any such anniversary date so that upon the anniversary date if notice had not been previously given as provided in this Section 4(a), the Employment Period shall be and continue for a three (3) year period thereafter.  References in the Agreement to “Employment Period” shall refer to the Initial Term of this Agreement and any extensions to the Initial Term of this Agreement.  It is the intention of the parties that this Agreement be “Evergreen” unless (i) either party gives written notice to the other party of his or its intention not to renew this Agreement as provided above or (ii) this Agreement is terminated pursuant to Section 4(b) hereof.

 

(b)                                 Notwithstanding the provisions of Section 4(a) of this Agreement, this Agreement shall terminate automatically for Cause (as defined herein) upon written notice from the Board of Directors of the Bank to Executive.  As used in this Agreement, “Cause” shall mean any of the following:

 

(i)                                     Executive’s conviction of or plea of guilty or nolo contendere to a felony, a crime of falsehood or a crime involving moral turpitude, or the actual incarceration of Executive for a period of twenty (20) consecutive days or more;

 

(ii)                                  Executive’s failure to follow the good faith lawful instructions of the Board of Directors of the Bank with respect to its operations, after written notice from the Bank and a failure to cure such violation within thirty (30) days of said written notice;

 

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(iii)                               Executive’s willful failure to substantially perform Executive’s duties to the Bank, other than a failure resulting from Executive’s incapacity because of physical or mental illness, as provided in subsection (d) of this Section 4, after written notice from the Bank and a failure to cure such violation within thirty (30) days of said written notice;

 

(iv)                              Executive’s intentional violation of the provisions of this Agreement, after written notice from the Bank and a failure to cure such violation within thirty (30) days of said written notice;

 

(v)                                 dishonesty or gross negligence of the Executive in the performance of his duties;

 

(vi)                              Executive’s removal or prohibition from being an institutional-affiliated party by a final order of an appropriate federal banking agency pursuant to Section 8(e) or 8(g) of the Federal Deposit Insurance Act or by an appropriate banking regulatory agency;

 

(vii)                           conduct by the Executive as determined by an affirmative vote of seventy-five percent (75%) of the disinterested members of the Board of Directors of the Bank which brings public discredit to the Corporation or the Bank and which results or may be reasonably expected to result in material financial or other harm to the Corporation or the Bank;

 

(viii)                        Executive’s breach of fiduciary duty involving personal profit;

 

(ix)                              unlawful harassment by the Executive against employees, customers, business associates, contractors, or vendors of the Corporation or the Bank which results or may be reasonably expected to result in material liability to the Corporation or the Bank, as determined by an affirmative vote of seventy-five percent (75%) of the disinterested independent members of the Board of Directors of the Bank, following an investigation of the claims by a third party unrelated to the Corporation or Bank chosen by the Executive, the Corporation and the Bank.  If the Executive, the Corporation and the Bank do not agree on said third party, then as chosen by an affirmative vote of seventy-five percent (75%) of the disinterested independent members of the Board of Directors of the Corporation;

 

(x)                                 the willful violation by the Executive of the provisions of Section 9, 10, or 11 hereof, after written notice from the Bank and a failure to cure such violation within thirty (30) days of said written notice;

 

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(xi)                              the willful violation of any law, rule or regulation governing banks or bank officers or any final cease and desist order issued by a bank regulatory authority;

 

(xii)                           theft or abuse by Executive of the Corporation’s or the Bank’s property or the property of the Corporation’s or the Bank’s customers, employees, contractors, vendors, or business associates;

 

(xiii)                        any act of fraud, misappropriation or personal dishonesty;

 

(xiv)                       insubordination as determined by an affirmative vote of seventy-five percent (75%) of the Board of Directors of the Bank, after written notice from the Bank and a failure to cure such violation within thirty (30) days of said written notice; or,

 

(xv)                          the existence of any material conflict between the interests of the Corporation or the Bank and the Executive that is not disclosed in writing by the Executive to the Corporation and the Bank and approved in writing by the Boards of Directors of the Corporation and the Bank.

 

(xvi)                       Before taking any vote under subparagraphs (vii), (ix) or (xiv) above, all which require notice, Executive shall be entitled to appear before the Board and present Executive’s position as to any issues about which Executive has been notified by the Board in writing.  Such appearance shall be within a reasonable period of time following written notice to Executive of the issues but in no event longer than thirty (30) days after the date of said written notice.

 

If this Agreement is terminated for Cause, all of Executive’s rights under this Agreement shall cease as of the effective date of such termination, except for the rights under Paragraph 19 hereof with respect to arbitration.

 

(c)                                  Notwithstanding the provisions of Section 4(a) of this Agreement, this Agreement shall terminate automatically upon Executive’s voluntary termination of employment (other than in accordance with Section 6 of this Agreement) for Good Reason.  The term “Good Reason” shall mean unless agreed to in writing by the Executive (i) the assignment of duties and responsibilities inconsistent with Executive’s status as President and Chief Executive Officer, (ii) a reassignment which requires Executive to move his principal residence or his office more than fifty (50) miles from the Bank’s principal executive office immediately prior to this Agreement, (iii) any removal of the Executive from office or any adverse change in the terms and conditions of the Executive’s employment, except for any termination of the Executive’s employment, (iv) any reduction in the Executive’s Annual Base Salary as in effect on the date hereof or as the same may be increased from time to time, or (v) any failure of the Bank to provide the Executive with benefits at least as favorable as those enjoyed by the Executive during the Employment Period under any of the pension, life insurance, medical, health and accident, disability or other employee plans of the Bank, or the taking of any action that would materially reduce any of such benefits unless such reduction is part of a reduction applicable to all employees.

 

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Executive shall, within ninety (90) days of the occurrence of any of the foregoing events, provide notice to the Bank of the existence of the condition and provide the Bank thirty (30) days in which to cure such condition.  In the event that the Bank does not cure the condition within thirty (30) days of such notice, Executive may resign from employment for Good Reason by delivering written notice to the Corporation and the Bank.

 

If such termination occurs for Good Reason, then the Bank shall pay Executive an amount equal to and no greater than 2.99 times the Executive’s Agreed Compensation as defined in subsection (g) of Section 4, and shall be payable in thirty-six (36) equal monthly installments and shall be subject to federal, state and local tax withholdings.  In addition, for a period of two (2) years from the date of termination of employment, or until Executive secures substantially similar benefits through other employment, whichever shall first occur, Executive shall receive a continuation of all life, disability, medical insurance and other normal health and welfare benefits in effect with respect to Executive during the two (2) years prior to his termination of employment, or, if the Bank cannot provide such benefits because Executive is no longer an employee, the Bank shall reimburse Executive in an amount equal to the monthly premium paid by him to obtain substantially similar employee benefits which he enjoyed prior to termination, subject to Code Section 409A if applicable.  However, in the event the payment described herein, when added to all other amounts or benefits provided to or on behalf of the Executive in connection with his termination of employment, would result in the imposition of an excise tax under Section 4999 of the Code, the Bank will pay to Executive an additional cash payment (“Gross-up Payment”) in an amount such that the after-tax proceeds of such Gross-up Payment (including any income tax or excise tax on such Gross-up Payment) will be equal to the amount of the excise tax.

 

Notwithstanding any other provision, in the event that Executive is determined to be a specified employee as that term is defined in Section 409A of the Code, no payment that is determined to be deferred compensation subject to Section 409A of the Code shall be made until one (1) day following six (6) months from the date of separation of service as that term is defined in Section 409A of the Code.

 

(d)                                 Notwithstanding the provisions of Section 4(a) of this Agreement, this Agreement shall terminate automatically upon Executive’s Disability and Executive’s rights under this Agreement shall cease as of the date of such termination; provided, however, that Executive shall nevertheless be entitled to receive an amount equal to and no greater than seventy-five percent (75%) of the Executive’s Agreed Compensation as defined in subsection (g) of this Section 4, less amounts payable under any disability plan of the Bank, until the earliest of (i) Executive’s return to employment, (ii) his attainment of age sixty-five (65), (iii) his death, or (iv) the end of the then existing Employment Period.

 

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In addition, Executive shall receive for such period a continuation of all life, disability, medical insurance and other normal health and welfare benefits in effect with respect to Executive during the two (2) years prior to his disability, or, if the Bank cannot provide such benefits because Executive is no longer an employee, the Bank shall reimburse Executive in an amount equal to the monthly premium paid by him to obtain substantially similar employee benefits which he enjoyed prior to termination, subject to Code Section 409A if applicable.  For purposes of this Agreement, the Executive shall have a Disability if, the Executive is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months or the Executive is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Bank.  The Executive shall have no duty to mitigate any payment provided for in this Section 4(d) by seeking other employment.

 

(e)                                  In the event that Executive terminates his employment without Good Reason as defined in Section 4(c), all of Executive’s rights under this Agreement shall cease as of the effective date of such termination, except for the rights under Paragraph 19 hereof with respect to arbitration.

 

(f)                                   Executive agrees that in the event his employment under this Agreement is terminated, Executive shall resign as a director of the Corporation or the Bank, or any affiliate or subsidiary thereof, if he is then serving as a director of any of such entities.

 

(g)                                  The term “Agreed Compensation” shall equal the sum of (i) the Executive’s highest Annual Base Salary under the Agreement, and (ii) the average of the Executive’s annual bonuses with respect to the three (3) calendar years immediately preceding the Executive’s termination.

 

5.                                                                                      Employment Period Compensation.

 

(a)                                 Annual Base Salary.  For services performed by Executive under this Agreement, the Bank shall pay Executive an Annual Base Salary during the Employment Period at the rate of $400,000 per year, minus applicable withholdings and deductions, payable at the same times as salaries are payable to other executive employees of the Bank.  The Bank may, from time to time, increase Executive’s Annual Base Salary, and any and all such increases shall be deemed to constitute amendments to this Section 5(a) to reflect the increased amounts, effective as of the date established for such increases by the Board of Directors of the Bank or any committee of such Board in the resolutions authorizing such increases.

 

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(b)                                 Bonus.  For services performed by Executive under this Agreement, the Bank may, from time to time, pay a bonus or bonuses to Executive as the Bank or an affiliate thereof, in its sole discretion, deems appropriate.  The payment of any such bonuses shall not reduce or otherwise affect any other obligation of the Bank to Executive provided for in this Agreement.

 

(c)                                  Paid Time-off.  During the term of this Agreement, Executive shall be entitled to paid time-off in accordance with the manner and amount provided under the paid time-off plan currently in effect.  Executive shall be able to accumulate unused paid time-off from one (1) year to the next not to exceed forty-five (45) days in total. However, Executive shall not be entitled to receive any additional compensation from the Bank for failure to take a vacation, except to the extent authorized by the Board of Directors of the Bank.

 

(d)                                 Employee Benefit Plans.  During the term of this Agreement, Executive shall be entitled to participate in or receive the benefits of any employee benefit plan currently in effect at the Bank, subject to the terms of said plan, until such time that the Board of Directors of the Bank authorize a change in such benefits.  The Bank shall not make any changes in such plans or benefits which would adversely affect Executive’s rights or benefits thereunder, unless such change occurs pursuant to a program applicable to all executive officers of the Bank and does not result in a proportionately greater adverse change in the rights of or benefits to Executive as compared with any other executive officer of the Bank.  Nothing paid to Executive under any plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the salary payable to Executive pursuant to Section 5(a) hereof.

 

(e)                                  Business Expenses.  During the term of this Agreement, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by him, which are properly accounted for, in accordance with the policies and procedures established by the Board of Directors of the Bank for its executive officers.

 

6.                                                                                      Termination of Employment Following Change in Control.

 

(a)                                 If a Change in Control (as defined in Section 6(b) of this Agreement) shall occur and (1) Executive is involuntarily terminated without Cause or (2) at the option of Executive, exercisable by Executive within one hundred eighty (180) days of the Change in Control, the Executive terminates employment and gives notice of the intention to collect benefits under this Agreement by delivering written notice (the “Notice of Termination”) to the Bank, then the provisions of Section 7 of this Agreement shall apply.

 

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(b)                                 As used in this Agreement, “Change in Control” shall mean the occurrence of any of the following, provided the event constitutes a change in control within the meaning of Code Section 409A and the rules, regulations, and guidance promulgated thereunder:

 

(i)  (A) a merger, consolidation or division involving the Corporation or the Bank, (B) a sale, exchange, transfer or other disposition of substantially all of the assets of the Corporation or the Bank, or (C) a purchase by the Corporation or the Bank of substantially all of the assets of another entity, unless after such merger, consolidation, division, sale, exchange, transfer, purchase or disposition a majority of the members of the Board of Directors of the legal entity resulting from or existing after any such transaction (and of the Board of Directors of such entity’s parent corporation, if any,) are former members of the Board of Directors of the Corporation or the Bank; or,

 

(ii)   any “person” (as such term is defined in Code Section 409A and any Revenue Guidance or Treasury Regulations issued thereunder), other than the Corporation or the Bank or any “person” who on the date hereof is a director or officer of the Corporation or the Bank, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Corporation or the Bank representing thirty (30%) percent or more of the total voting power of the Corporation’s or the Bank’s then outstanding securities; or,

 

(iii)  during any period of one (1) year during the Employment Period, individuals who at the beginning of such period constitute the Board of Directors of the Corporation or the Bank cease for any reason to constitute at least a majority thereof, unless the election of each director who was not a director at the beginning of such period has been approved in advance by directors representing at least two-thirds (2/3) of the directors then in office who were directors at the beginning of the period.

 

7.   Rights in Event of Termination Following a Change in Control.

 

(a)                                 In the event that Executive delivers a Notice of Termination (as defined in Section 6(a) of this Agreement) to the Bank or Executive is involuntarily terminated without Cause after a Change in Control (as defined in Section 6(b) of this Agreement), Executive shall be entitled to receive the compensation and benefits set forth below:

 

The Bank shall pay Executive a lump sum amount equal to and no greater than 2.99 times the Executive’s Agreed Compensation as defined in subsection (g) of Section 4, minus applicable taxes and withholdings. In addition, for a period of two (2) years from the date of termination of employment, or until Executive secures substantially similar benefits through other employment, whichever shall first occur, Executive shall receive a continuation of all life, disability, medical insurance and other normal health and welfare benefits in effect with respect to Executive during the two (2) years prior to his termination of employment, or, if the Bank cannot provide such benefits because Executive is no longer an employee, the Bank shall reimburse Executive in an amount equal to the monthly premium paid by him to obtain substantially similar employee benefits which he enjoyed prior to termination, subject to Code Section 409A if applicable.

 

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However, in the event the payment described herein, when added to all other amounts or benefits provided to or on behalf of the Executive in connection with his termination of employment, would result in the imposition of an excise tax under Section 4999 of the Code, the Bank will pay to Executive an additional cash payment (“Gross-up Payment”) in an amount such that the after-tax proceeds of such Gross-up Payment (including any income tax or excise tax on such Gross-up Payment) will be equal to the amount of the excise tax.

 

Notwithstanding any other provision, in the event that Executive is determined to be a specified employee as that term is defined in Section 409A of the Code, no payment that is determined to be deferred compensation subject to Section 409A of the Code shall be made until one (1) day following six (6) months from the date of separation of service as that term is defined in Section 409A of the Code.

 

(b)                                 Executive shall not be required to mitigate the amount of any payment provided for in this Section 7 by seeking other employment or otherwise.  Unless otherwise agreed to in writing, the amount of payment or the benefit provided for in this Section 7 shall not be reduced by any compensation earned by Executive as the result of employment by another employer or by reason of Executive’s receipt of or right to receive any retirement or other benefits after the date of termination of employment or otherwise.

 

8.  Rights in Event of Termination of Employment Absent Change in Control.

 

(a)       In the event that Executive’s employment is involuntarily terminated by the Bank without Cause and no Change in Control shall have occurred at the date of such termination, the Bank shall pay Executive an amount equal to and no greater than 2.99 times the Executive’s Agreed Compensation as defined in subsection (g) of Section 4, and shall be payable in thirty-six (36) equal monthly installments and shall be subject to federal, state and local tax withholdings.  In addition, for a period of two (2) years from the date of termination of employment, or until Executive secures substantially similar benefits through other employment, whichever shall first occur, Executive shall receive a continuation of all life, disability, medical insurance and other normal health and welfare benefits in effect with respect to Executive during the two (2) years prior to his termination of employment, or, if the Bank cannot provide such benefits because Executive is no longer an employee, the Bank shall reimburse Executive in an amount equal to the monthly premium paid by him to obtain substantially similar employee benefits which he enjoyed prior to termination, subject to Code Section 409A if applicable.

 

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However, in the event the payment described herein, when added to all other amounts or benefits provided to or on behalf of the Executive in connection with his termination of employment, would result in the imposition of an excise tax under Section 4999 of the Code, the Bank will pay to Executive an additional cash payment (“Gross-up Payment”) in an amount such that the after-tax proceeds of such Gross-up Payment (including any income tax or excise tax on such Gross-up Payment) will be equal to the amount of the excise tax.

 

Notwithstanding any other provision, in the event that Executive is determined to be a specified employee as that term is defined in Section 409A of the Code, no payment that is determined to be deferred compensation subject to Section 409A of the Code shall be made until one (1) day following six (6) months from the date of separation of service as that term is defined in Section 409A of the Code.

 

(b)                                 Executive shall not be required to mitigate the amount of any payment provided for in this Section 8 by seeking other employment or otherwise.  Unless otherwise agreed to in writing, the amount of payment or the benefit provided for in this Section 8 shall not be reduced by any compensation earned by Executive as the result of employment by another employer or by reason of Executive’s receipt of or right to receive any retirement or other benefits after the date of termination of employment or otherwise.

 

9.  Covenant Not to Compete.

 

(a)                                 Executive hereby acknowledges and recognizes the highly competitive nature of the business of the Corporation and the Bank and accordingly agrees that, during and for the applicable period set forth in Section 9(c) hereof, Executive shall not, except as otherwise permitted in writing by the Bank:

 

(i)  be engaged, directly or indirectly, either for his own account or as agent, consultant, employee, partner, officer, director, proprietor, investor (except as an investor owning less than 5% of the stock of a publicly owned company) or otherwise of any person, firm, corporation or enterprise engaged in (1) the banking (including bank holding company) or financial services industry, or (2) any other activity in which the Corporation or the Bank or any of their subsidiaries are engaged during the Employment Period, and remain so engaged at the end of the Employment Period, within a fifty (50) mile radius of the Bank’s principal place of business at 16 Lincoln Square, Gettysburg, Pennsylvania (the “Non-Competition Area”);

 

(ii) provide financial or other assistance to any person, firm, corporation, or enterprise engaged in (1) the banking (including bank holding company) or financial services industry, or (2) any other activity in which the Corporation or the Bank or any of their subsidiaries are engaged during the Employment Period, in the Non-Competition Area;

 

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(iii)  directly or indirectly solicit persons or entities who were customers or referral sources of the Corporation, the Bank or their subsidiaries within six (6) months of Executive’s termination of employment, to become a customer or referral source of a person or entity other than the Corporation, the Bank or their subsidiaries; or,

 

(iv)   directly or indirectly solicit employees of the Corporation, the Bank or their subsidiaries who were employed within two (2) years of Executive’s termination of employment to work for anyone other than the Corporation, the Bank or their subsidiaries.

 

(b)                                 It is expressly understood and agreed that, although Executive and the Corporation and the Bank consider the restrictions contained in Section 9(a) hereof reasonable for the purpose of preserving for the Corporation and the Bank and their subsidiaries their goodwill and other proprietary rights, if a final judicial determination is made by a court having jurisdiction that the time or territory or any other restriction contained in Section 9(a) hereof is an unreasonable or otherwise unenforceable restriction against Executive, the provisions of Section 9(a) hereof shall not be rendered void but shall be deemed amended to apply as to such maximum time and territory and to such other extent as such court may judicially determine or indicate to be reasonable.

 

(c)                                  The provisions of this Section 9 shall be applicable, commencing on the date of this Agreement and ending on one of the following dates as applicable:

 

(i)   if Executive voluntarily terminates his employment in accordance with the provisions of Section 4(e) of this Agreement (relating to termination without Good Reason), the first anniversary date of the effective date of termination of employment;

 

(ii)  if Executive’s employment terminates in accordance with the provisions of Section 4(b) of this Agreement (relating to termination for Cause), the first anniversary date of the effective date of termination of employment;

 

(iii)  if the Executive voluntarily terminates his employment in accordance with the provisions of Section 4(c) of this Agreement (relating to termination by Executive for Good Reason), the second anniversary date of the effective date of termination of employment;

 

(iv)  if the Executive’s employment is involuntarily terminated in accordance with the provisions of Section 6 of this Agreement (relating to involuntary termination without Cause following a Change in Control), the second anniversary date of the effective date of termination of employment; or,

 

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(v)  if the Executive’s employment is involuntarily terminated in accordance with the provisions of Section 8 of this Agreement (relating to involuntary termination without Cause absent a Change in Control), the second anniversary date of the effective date of termination of employment.

 

10.                               Unauthorized Disclosure.  During the Employment Period, or at any later time, the Executive shall not, without the written consent of the Board of Directors of the Bank or a person authorized thereby, knowingly disclose to any person, other than an employee of the Corporation or the Bank or a person to whom disclosure is reasonably necessary or appropriate in connection with the performance by the Executive of his duties as an executive of the Bank, any material confidential information obtained by him while in the employ of the Bank with respect to any of the Corporation’s and the Bank’s services, products, improvements, formulas, designs or styles, processes, customers, methods of business or any business practices the disclosure of which could be or will be damaging to the Corporation or the Bank; provided, however, that confidential information shall not include any information known generally to the public (other than as a result of unauthorized disclosure by the Executive or any person with the assistance, consent or direction of the Executive) or any information of a type not otherwise considered confidential by persons engaged in the same business or a business similar to that conducted by the Corporation and the Bank or any information that must be disclosed as required by law.

 

11.                               Work Made for Hire.  Any work performed by the Executive under this Agreement should be considered a “Work Made for Hire” as the phrase is defined by the U.S. copyright laws and shall be owned by and for the express benefit of the Bank and its affiliates and subsidiaries.  In the event it should be established that such work does not qualify as a Work Made for Hire, the Executive agrees to and does hereby assign to the Bank, and its affiliates and subsidiaries, all of his rights, title, and/or interest in such work product, including, but not limited to, all copyrights, patents, trademarks, and propriety rights.

 

12.                               Return of Company Property and Documents.  The Executive agrees that, at the time of termination of his employment, regardless of the reason for termination, he will deliver to the Bank and its affiliates and subsidiaries, any and all company property, including, but not limited to, keys, security codes or passes, mobile telephones, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, software programs, equipment, other documents or property, or reproductions of any of the aforementioned items developed or obtained by the Executive during the course of his employment.

 

13.                               Liability Insurance.  The Bank shall obtain liability insurance coverage for the Executive under an insurance policy with similar terms as that which is currently covering officers and directors of the Bank against lawsuits, arbitrations or other legal or regulatory proceedings.

 

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14.                               Notices.  Except as otherwise provided in this Agreement, any notice required or permitted to be given under this Agreement shall be deemed properly given if in writing and if mailed by registered or certified mail, postage prepaid with return receipt requested, to Executive’s residence, in the case of notices to Executive, and to the principal executive office of the Corporation and Bank, in the case of notices to the Corporation and the Bank.

 

15.                               Waiver.  No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Executive and an executive officer specifically designated by the Board of Directors of the Corporation and the Bank.  No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 

16.                               Assignment.  This Agreement shall not be assignable by any party, except by the Corporation or the Bank to any successor in interest to its business.

 

17.                               Entire Agreement.  This Agreement supersedes any and all agreements, either oral or in writing, between the parties with respect to the employment of the Executive by the Bank and/or the Corporation and this Agreement contains all the covenants and agreements between the parties with respect to employment. This Agreement specifically releases all parties of any rights and obligations under the Executive Employment Agreement of April 15, 2009, and all amendments thereto, and said agreement and amendments are hereafter null and void.

 

18.                               Successors; Binding Agreement.

 

(a)                                 The Corporation or the Bank will require any successor (whether direct or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the businesses and/or assets of the Corporation and the Bank to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Bank would be required to perform it if no such succession had taken place.  Failure by the Corporation and the Bank to obtain such assumption and agreement prior to the effectiveness of any such succession shall constitute a breach of this Agreement and the provisions of Section 7 of this Agreement shall apply.  As used in this Agreement, “Corporation” and “Bank” shall mean the Corporation and the Bank, as defined previously and any successor to their respective businesses and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law or otherwise.

 

(b)                                 This Agreement shall inure to the benefit of and be enforceable by Executive’s personal or legal representatives, executors, administrators, heirs, distributees, devisees and legatees.  If Executive should die after a Notice of Termination is delivered by Executive, after a Change in Control, or following termination of Executive’s employment without Cause or for Good Reason, and any amounts would be payable to Executive under this Agreement if Executive had continued to live, all such amounts shall be paid in accordance with the terms of this Agreement to Executive’s devisee, legatee, or other designee, or, if there is no such designee, to Executive’s estate.

 

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19.                               Arbitration.  The Bank and Executive recognize that in the event a dispute should arise between them concerning the interpretation or implementation of this Agreement, lengthy and expensive litigation will not afford a practical resolution of the issues within a reasonable period of time. Consequently, each party agrees that all disputes, disagreements and questions of interpretation concerning this Agreement (except for any enforcement sought with respect to Sections 9, 10, 11 or 12 which may be litigated in court, including an action for injunction or other relief) are to be submitted for resolution, in Gettysburg, Pennsylvania, to the American Arbitration Association (the “Association”) in accordance with the Association’s National Rules for the Resolution of Employment Disputes or other applicable rules then in effect (“Rules”).  The Bank or Executive may initiate an arbitration proceeding at any time by giving notice to the other in accordance with the Rules.  The Bank and Executive may, as a matter of right, mutually agree on the appointment of a particular arbitrator from the Association’s pool.  The arbitrator shall not be bound by the rules of evidence and procedure of the courts of the Commonwealth of Pennsylvania but shall be bound by the substantive law applicable to this Agreement.  The decision of the arbitrator, absent fraud, duress, incompetence or gross and obvious error of fact, shall be final and binding upon the parties and shall be enforceable in courts of proper jurisdiction.  Following written notice of a request for arbitration, the Bank and Executive shall be entitled to an injunction restraining all further proceedings in any pending or subsequently filed litigation concerning this Agreement, except as otherwise provided herein or any enforcement sought with respect to Sections 9, 10, 11 or 12 of this Agreement, including an action for injunction or other relief.

 

20.                               Validity.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

 

21.                               Applicable Law.  This Agreement shall be governed by and construed in accordance with the domestic, internal laws of the Commonwealth of Pennsylvania, without regard to its conflicts of laws principles.

 

22.                               Headings.  The section headings of this Agreement are for convenience only and shall not control or affect the meaning or construction or limit the scope or intent of any of the provisions of this Agreement.

 

14

 

IN WITNESS WHEREOF, the Parties, intending to be legally bound hereby, have caused this Amended and Restated Employment Agreement to be duly executed in their respective names and, in the case of the Corporation and the Bank, by its authorized representative, effective on the day and year first above written.

 

	
ATTEST:
    	
 
    	
ACNB   CORPORATION
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/ Lynda   L. Glass
    	
 
    	
By
    	
/s/ Frank Elsner III
    
	
 
    	
 
    	
 
    	
Frank Elsner III
    
	
 
    	
 
    	
 
    	
Chairman of the Board
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
ACNB BANK
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/ Lynda   L. Glass
    	
 
    	
By
    	
/s/ Frank Elsner III
    
	
 
    	
 
    	
 
    	
Frank Elsner III
    
	
 
    	
 
    	
 
    	
Chairman of the Board
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
WITNESS:
    	
 
    	
EXECUTIVE
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ Frank   Elsner III
    	
 
    	
/s/ James   P. Helt
    
	
 
    	
 
    	
James P.   Helt
    
					

 

15EXHIBIT 4.1

 

[FORM OF SENIOR SECURED CONVERTIBLE NOTE]

 

NEITHER THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY ACCEPTABLE
TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144
OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES. ANY TRANSFEREE OF THIS NOTE SHOULD CAREFULLY REVIEW THE
TERMS OF THIS NOTE, INCLUDING SECTIONS 3(c)(iii) AND 18(a) HEREOF. THE PRINCIPAL AMOUNT REPRESENTED BY THIS NOTE AND, ACCORDINGLY,
THE SECURITIES ISSUABLE UPON CONVERSION HEREOF MAY BE LESS THAN THE AMOUNTS SET FORTH ON THE FACE HEREOF PURSUANT TO SECTION 3(c)(iii)
OF THIS NOTE.

 

[THIS NOTE HAS BEEN ISSUED WITH ORIGINAL
ISSUE DISCOUNT (“OID”). PURSUANT TO TREASURY REGULATION §1.1275-3(b)(1), ZHENGYU WANG, A REPRESENTATIVE OF THE
COMPANY HEREOF WILL, BEGINNING TEN DAYS AFTER THE ISSUANCE DATE OF THIS NOTE, PROMPTLY MAKE AVAILABLE TO THE HOLDER UPON REQUEST
THE INFORMATION DESCRIBED IN TREASURY REGULATION §1.1275-3(b)(1)(i). ZHENGYU WANG MAY BE REACHED AT TELEPHONE NUMBER +86-057-1875555801.]

 

Farmmi,
Inc.

 

Senior
Secured Convertible Note

 

	Issuance Date: November 1, 2018	Original Principal Amount: U.S. $______

 

FOR VALUE RECEIVED,
Farmmi, Inc., an exempted company incorporated under the laws of the Cayman Islands (the “Company”), hereby
promises to pay to the order of [BUYER] or its registered assigns (“Holder”) the amount set forth above as the
Original Principal Amount (as reduced pursuant to the terms hereof pursuant to redemption, conversion or otherwise, the “Principal”)
when due, whether upon the Maturity Date, on any Installment Date with respect to the Installment Amount due on such Installment
Date (each as defined below), or upon acceleration, redemption or otherwise (in each case in accordance with the terms hereof)
and to pay interest (“Interest”) on any outstanding Principal at the applicable Interest Rate (as defined below)
from the date set forth above as the Issuance Date (the “Issuance Date”) until the same becomes due and payable,
whether upon the Maturity Date, on any Installment Date with respect to the Installment Amount due on such Installment Date, or
upon acceleration, conversion, redemption or otherwise (in each case in accordance with the terms hereof). This Senior Secured
Convertible Note (including all Senior Secured Convertible Notes issued in exchange, transfer or replacement hereof, this “Note”)
is one of an issue of Senior Secured Convertible Notes issued pursuant to the Securities Purchase Agreement, dated as of November
1, 2018 (the “Subscription Date”), by and among the Company and the investors (the “Buyers”)
referred to therein, as amended from time to time (collectively, the “Notes”, and such other Senior Secured
Convertible Notes, the “Other Notes”). Certain capitalized terms used herein are defined in Section 31.

 

     

     

    

 

1.            PAYMENTS
OF PRINCIPAL. On each Installment Date, the Company shall pay to the Holder an amount equal to the Installment Amount due on
such Installment Date in accordance with Section 8. On the Maturity Date, the Company shall pay to the Holder an amount in cash
(excluding any amounts paid in Ordinary Shares on the Maturity Date in accordance with Section 8) representing all outstanding
Principal, accrued and unpaid Interest and accrued and unpaid Late Charges (as defined in Section 24(c)) on such Principal and
Interest. Other than as specifically permitted by this Note, the Company may not prepay any portion of the outstanding Principal,
accrued and unpaid Interest or accrued and unpaid Late Charges on Principal and Interest, if any.

 

2.            INTEREST;
INTEREST RATE.

 

(a)          Interest
on this Note shall commence accruing on the Issuance Date and shall be computed on the basis of a 360-day year and twelve 30-day
months and shall be payable in arrears on each Interest Date and shall be payable in accordance with the terms of this Note. Interest
shall be paid (i) on each Interest Date occurring on an Installment Date in accordance with Section 8 as part of the applicable
Installment Amount due on the applicable Installment Date and (ii) with respect to each other Interest Date, on such Interest Date
in cash.

 

(b)          Prior
to the payment of Interest on an Interest Date, Interest on this Note shall accrue at the Interest Rate and be payable by way of
inclusion of the Interest in the Conversion Amount on each Conversion Date in accordance with Section 3(b)(i) or upon any redemption
in accordance with Section 11 or any required payment upon any Bankruptcy Event of Default. From and after the occurrence and during
the continuance of any Event of Default, the Interest Rate shall automatically be increased to eighteen percent (18.0%) per annum.
In the event that such Event of Default is subsequently cured and no other Event of Default then exists (including, without limitation,
for the Company’s failure to pay such Interest at the Default Rate on the applicable Interest Date), the adjustment referred
to in the preceding sentence shall cease to be effective as of the calendar day immediately following the date of such cure; provided
that the Interest as calculated and unpaid at such increased rate during the continuance of such Event of Default shall continue
to apply to the extent relating to the days after the occurrence of such Event of Default through and including the date of such
cure of such Event of Default.

 

    	 	2	 

     

    

 

3.            CONVERSION
OF NOTES. At any time after the Issuance Date, this Note shall be convertible into validly issued, fully paid and non-assessable
Ordinary Shares (as defined below), on the terms and conditions set forth in this Section 3.

 

(a)          Conversion
Right. Subject to the provisions of Section 3(d), at any time or times on or after the Issuance Date, the Holder shall be entitled
to convert any portion of the outstanding and unpaid Conversion Amount (as defined below) into validly issued, fully paid and non-assessable
Ordinary Shares in accordance with Section 3(c), at the Conversion Rate (as defined below). The Company shall not issue any fraction
of an Ordinary Share upon any conversion. If the issuance would result in the issuance of a fraction of an Ordinary Share, the
Company shall round such fraction of an Ordinary Share up to the nearest whole share. The Company shall pay any and all transfer,
stamp, issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of the Transfer Agent (as
defined below)) that may be payable with respect to the issuance and delivery of Ordinary Shares upon conversion of any Conversion
Amount.

 

(b)          Conversion
Rate. The number of Ordinary Shares issuable upon conversion of any Conversion Amount pursuant to Section 3(a) shall be determined
by dividing (x) such Conversion Amount by (y) the Conversion Price (the “Conversion Rate”).

 

(i)          “Conversion
Amount” means the sum of (x) portion of the Principal to be converted, redeemed or otherwise with respect to which this
determination is being made, (y) all accrued and unpaid Interest with respect to such portion of the Principal amount and accrued
and unpaid Late Charges with respect to such portion of such Principal and such Interest, if any, and (z) the applicable Make-Whole
Amount, if any.

 

(ii)         “Conversion
Price” means, as of any Conversion Date or other date of determination, $6.26, subject to adjustment as provided herein.

 

    	 	3	 

     

    

 

(c)          Mechanics
of Conversion.

 

(i)          Optional
Conversion. To convert any Conversion Amount into Ordinary Shares on any date (a “Conversion Date”), the
Holder shall deliver (whether via facsimile, electronic mail or otherwise), for receipt on or prior to 11:59 p.m., New York time,
on such date, a copy of an executed notice of conversion in the form attached hereto as Exhibit I (the “Conversion
Notice”) to the Company. If required by Section 3(c)(iii), within two (2) Trading Days following a conversion of this
Note as aforesaid, the Holder shall surrender this Note to a nationally recognized overnight delivery service for delivery to the
Company (or an indemnification undertaking with respect to this Note in the case of its loss, theft or destruction as contemplated
by Section 18(b)). On or before the first (1st) Trading Day following the date of receipt of a Conversion Notice, the Company shall
transmit by facsimile or electronic mail an acknowledgment of confirmation and representation as to whether such Ordinary Shares
may then be resold pursuant to Rule 144 or an effective and available registration statement, in the form attached hereto as Exhibit
II, of receipt of such Conversion Notice to the Holder and the Company’s transfer agent (the “Transfer Agent”)
which confirmation shall constitute an instruction to the Transfer Agent to process such Conversion Notice in accordance with the
terms herein. On or before the second (2nd) Trading Day following the date on which the Company has received a Conversion Notice
(or such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for the settlement of a
trade initiated on the applicable Conversion Date of such Ordinary Shares issuable pursuant to such Conversion Notice) (the “Share
Delivery Deadline”), the Company shall (1) provided that the Transfer Agent is participating in The Depository Trust
Company’s (“DTC”) Fast Automated Securities Transfer Program, credit such aggregate number of Ordinary
Shares to which the Holder shall be entitled pursuant to such conversion to the Holder’s or its designee’s balance
account with DTC through its Deposit/Withdrawal at Custodian system or (2) if the Transfer Agent is not participating in the DTC
Fast Automated Securities Transfer Program, upon the request of the Holder, issue and deliver (via reputable overnight courier)
to the address as specified in the Conversion Notice, a certificate, registered in the name of the Holder or its designee, for
the number of Ordinary Shares to which the Holder shall be entitled pursuant to such conversion. If this Note is physically surrendered
for conversion pursuant to Section 3(c)(iii) and the outstanding Principal of this Note is greater than the Principal portion of
the Conversion Amount being converted, then the Company shall as soon as practicable and in no event later than two (2) Business
Days after receipt of this Note and at its own expense, issue and deliver to the Holder (or its designee) a new Note (in accordance
with Section 18(d)) representing the outstanding Principal not converted. The Person or Persons entitled to receive the Ordinary
Shares issuable upon a conversion of this Note shall be treated for all purposes as the record holder or holders of such Ordinary
Shares on the Conversion Date. In the event of a partial conversion of this Note pursuant hereto, the Principal amount converted
shall be deducted from the Installment Amount(s) relating to the Installment Date(s) as set forth in the applicable Conversion
Notice and. Notwithstanding anything to the contrary contained in this Note or the Registration Rights Agreement, after the effective
date of the Registration Statement (as defined in the Registration Rights Agreement) and prior to the Holder’s receipt of
the notice of a Grace Period (as defined in the Registration Rights Agreement), the Company shall cause the Transfer Agent to deliver
unlegended Ordinary Shares to the Holder (or its designee) in connection with any sale of Registrable Securities (as defined in
the Registration Rights Agreement) with respect to which the Holder has entered into a contract for sale, and delivered a copy
of the prospectus included as part of the particular Registration Statement to the extent applicable, and for which the Holder
has not yet settled.

 

    	 	4	 

     

    

 

(ii)         Company’s
Failure to Timely Convert. If the Company shall fail, for any reason or for no reason, on or prior to the applicable Share
Delivery Deadline, either (I) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program,
to issue and deliver to the Holder (or its designee) a certificate for the number of Ordinary Shares to which the Holder is entitled
and register such Ordinary Shares on the Company’s share register or, if the Transfer Agent is participating in the DTC Fast
Automated Securities Transfer Program, to credit the balance account of the Holder or the Holder’s designee with DTC for
such number of Ordinary Shares to which the Holder is entitled upon the Holder’s conversion of this Note (as the case may
be) or (II) if the Registration Statement covering the resale of the Ordinary Shares that are the subject of the Conversion Notice
(the “Unavailable Conversion Shares”) is not available for the resale of such Unavailable Conversion Shares
and the Company fails to promptly, but in no event later than as required pursuant to the Registration Rights Agreement (x) so
notify the Holder and (y) deliver the Ordinary Shares electronically without any restrictive legend by crediting such aggregate
number of Ordinary Shares to which the Holder is entitled pursuant to such conversion to the Holder’s or its designee’s
balance account with DTC through its Deposit/Withdrawal At Custodian system (the event described in the immediately foregoing clause
(II) is hereinafter referred as a “Notice Failure” and together with the event described in clause (I) above,
a “Conversion Failure”), then, in addition to all other remedies available to the Holder, (1) the Company shall
pay in cash to the Holder on each day after such Share Delivery Deadline that the issuance of such Ordinary Shares is not timely
effected an amount equal to 1% of the product of (A) the sum of the number of Ordinary Shares not issued to the Holder on or prior
to the Share Delivery Deadline and to which the Holder is entitled, multiplied by (B) any trading price of the Ordinary Shares
selected by the Holder in writing as in effect at any time during the period beginning on the applicable Conversion Date and ending
on the applicable Share Delivery Deadline and (2) the Holder, upon written notice to the Company, may void its Conversion Notice
with respect to, and retain or have returned (as the case may be) any portion of this Note that has not been converted pursuant
to such Conversion Notice, provided that the voiding of a Conversion Notice shall not affect the Company’s obligations to
make any payments which have accrued prior to the date of such notice pursuant to this Section 3(c)(ii) or otherwise. In addition
to the foregoing, if on or prior to the Share Delivery Deadline either (A) if the Transfer Agent is not participating in the DTC
Fast Automated Securities Transfer Program, the Company shall fail to issue and deliver to the Holder (or its designee) a certificate
and register such Ordinary Shares on the Company’s share register or, if the Transfer Agent is participating in the DTC Fast
Automated Securities Transfer Program, the Transfer Agent shall fail to credit the balance account of the Holder or the Holder’s
designee with DTC for the number of Ordinary Shares to which the Holder is entitled upon the Holder’s conversion hereunder
or pursuant to the Company’s obligation pursuant to clause (II) below or (B) a Notice Failure occurs, and if on or after
such Share Delivery Deadline the Holder purchases (in an open market transaction or otherwise) Ordinary Shares corresponding to
all or any portion of the number of Ordinary Shares issuable upon such conversion that the Holder is entitled to receive from the
Company and has not received from the Company in connection with such Conversion Failure or Notice Failure, as applicable (a “Buy-In”),
then, in addition to all other remedies available to the Holder, the Company shall, within two (2) Business Days after receipt
of the Holder’s request and in the Holder’s discretion, either: (I) pay cash to the Holder in an amount equal to the
Holder’s total purchase price (including brokerage commissions and other out-of-pocket expenses, if any) for the Ordinary
Shares so purchased (including, without limitation, by any other Person in respect, or on behalf, of the Holder) (the “Buy-In
Price”), at which point the Company’s obligation to so issue and deliver such certificate (and to issue such Ordinary
Shares) or credit the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of
Ordinary Shares to which the Holder is entitled upon the Holder’s conversion hereunder (as the case may be) (and to issue
such Ordinary Shares) shall terminate, or (II) promptly honor its obligation to so issue and deliver to the Holder a certificate
or certificates representing such Ordinary Shares or credit the balance account of such Holder or such Holder’s designee,
as applicable, with DTC for the number of Ordinary Shares to which the Holder is entitled upon the Holder’s conversion hereunder
(as the case may be) and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product
of (x) such number of Ordinary Shares multiplied by (y) the lowest Closing Sale Price of the Ordinary Shares on any Trading Day
during the period commencing on the date of the applicable Conversion Notice and ending on the date of such issuance and payment
under this clause (II) (the “Buy-In Payment Amount”). Nothing shall limit the Holder’s right to pursue
any other remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance
and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing Ordinary Shares
(or to electronically deliver such Ordinary Shares) upon the conversion of this Note as required pursuant to the terms hereof.

 

    	 	5	 

     

    

 

(iii)        Registration;
Book-Entry. The Company shall maintain a register (the “Register”) for the recordation of the names and
addresses of the holders of each Note and the principal amount of the Notes held by such holders (the “Registered Notes”).
The entries in the Register shall be conclusive and binding for all purposes absent manifest error. The Company and the holders
of the Notes shall treat each Person whose name is recorded in the Register as the owner of a Note for all purposes (including,
without limitation, the right to receive payments of Principal and Interest hereunder) notwithstanding notice to the contrary.
A Registered Note may be assigned, transferred or sold in whole or in part only by registration of such assignment or sale on the
Register. Upon its receipt of a written request to assign, transfer or sell all or part of any Registered Note by the holder thereof,
the Company shall record the information contained therein in the Register and issue one or more new Registered Notes in the same
aggregate principal amount as the principal amount of the surrendered Registered Note to the designated assignee or transferee
pursuant to Section 18, provided that if the Company does not so record an assignment, transfer or sale (as the case may be)
of all or part of any Registered Note within two (2) Business Days of such a request, then the Register shall be automatically
deemed updated to reflect such assignment, transfer or sale (as the case may be). Notwithstanding anything to the contrary set
forth in this Section 3, following conversion of any portion of this Note in accordance with the terms hereof, the Holder
shall not be required to physically surrender this Note to the Company unless (A) the full Conversion Amount represented by this
Note is being converted (in which event this Note shall be delivered to the Company following conversion thereof as contemplated
by Section 3(c)(i)) or (B) the Holder has provided the Company with prior written notice (which notice may be included in a Conversion
Notice) requesting reissuance of this Note upon physical surrender of this Note. The Holder and the Company shall maintain records
showing the Principal, Interest and Late Charges converted and/or paid (as the case may be) and the dates of such conversions,
and/or payments (as the case may be) or shall use such other method, reasonably satisfactory to the Holder and the Company, so
as not to require physical surrender of this Note upon conversion. If the Company does not update the Register to record such Principal,
Interest and Late Charges converted and/or paid (as the case may be) and the dates of such conversions and/or payments (as the
case may be) within two (2) Business Days of such occurrence, then the Register shall be automatically deemed updated to reflect
such occurrence.

 

    	 	6	 

     

    

 

(iv)        Pro
Rata Conversion; Disputes. In the event that the Company receives a Conversion Notice from more than one holder of Notes for
the same Conversion Date and the Company can convert some, but not all, of such portions of the Notes submitted for conversion,
the Company, subject to Section 3(d), shall convert from each holder of Notes electing to have Notes converted on such date a pro
rata amount of such holder’s portion of its Notes submitted for conversion based on the principal amount of Notes submitted
for conversion on such date by such holder relative to the aggregate principal amount of all Notes submitted for conversion on
such date. In the event of a dispute as to the number of Ordinary Shares issuable to the Holder in connection with a conversion
of this Note, the Company shall issue to the Holder the number of Ordinary Shares not in dispute and resolve such dispute in accordance
with Section 23.

 

(d)          Limitations
on Conversions. The Company shall not effect the conversion of any portion of this Note, and the Holder shall not have the
right to convert any portion of this Note pursuant to the terms and conditions of this Note and any such conversion shall be null
and void and treated as if never made, to the extent that after giving effect to such conversion, the Holder together with the
other Attribution Parties collectively would beneficially own in excess of 4.99% (the “Maximum Percentage”)
of the Ordinary Shares outstanding immediately after giving effect to such conversion. For purposes of the foregoing sentence,
the aggregate number of Ordinary Shares beneficially owned by the Holder and the other Attribution Parties shall include the number
of Ordinary Shares held by the Holder and all other Attribution Parties plus the number of Ordinary Shares issuable upon conversion
of this Note with respect to which the determination of such sentence is being made, but shall exclude Ordinary Shares which would
be issuable upon (A) conversion of the remaining, nonconverted portion of this Note beneficially owned by the Holder or any of
the other Attribution Parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities
of the Company (including, without limitation, any convertible notes or convertible preferred shares or warrants, including, without
limitation, the Warrants) beneficially owned by the Holder or any other Attribution Party subject to a limitation on conversion
or exercise analogous to the limitation contained in this Section 3(d). For purposes of this Section 3(d), beneficial ownership
shall be calculated in accordance with Section 13(d) of the 1934 Act. For purposes of determining the number of outstanding Ordinary
Shares the Holder may acquire upon the conversion of this Note without exceeding the Maximum Percentage, the Holder may rely on
the number of outstanding Ordinary Shares as reflected in (x) the Company’s most recent Annual Report on Form 20-F, Report
of Foreign Issuer on Form 6-K or other public filing with the SEC, as the case may be, (y) a more recent public announcement by
the Company or (z) any other written notice by the Company or the Transfer Agent, if any, setting forth the number of Ordinary
Shares outstanding (the “Reported Outstanding Share Number”). If the Company receives a Conversion Notice from
the Holder at a time when the actual number of outstanding Ordinary Shares is less than the Reported Outstanding Share Number,
the Company shall notify the Holder in writing of the number of Ordinary Shares then outstanding and, to the extent that such Conversion
Notice would otherwise cause the Holder’s beneficial ownership, as determined pursuant to this Section 3(d), to exceed the
Maximum Percentage, the Holder must notify the Company of a reduced number of Ordinary Shares to be purchased pursuant to such
Conversion Notice. For any reason at any time, upon the written or oral request of the Holder, the Company shall within one (1)
Business Day confirm orally and in writing or by electronic mail to the Holder the number of Ordinary Shares then outstanding.
In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Note, by the Holder and any other Attribution Party since the date as of which the Reported
Outstanding Share Number was reported. In the event that the issuance of Ordinary Shares to the Holder upon conversion of this
Note results in the Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the
Maximum Percentage of the number of outstanding Ordinary Shares (as determined under Section 13(d) of the 1934 Act), the number
of shares so issued by which the Holder’s and the other Attribution Parties’ aggregate beneficial ownership exceeds
the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio,
and the Holder shall not have the power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Company,
the Holder may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery
of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice;
provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day
after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the other
Attribution Parties and not to any other holder of Notes that is not an Attribution Party of the Holder. For purposes of clarity,
the Ordinary Shares issuable pursuant to the terms of this Note in excess of the Maximum Percentage shall not be deemed to be beneficially
owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability
to convert this Note pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph
with respect to any subsequent determination of convertibility. The provisions of this paragraph shall be construed and implemented
in a manner otherwise than in strict conformity with the terms of this Section 3(d) to the extent necessary to correct this paragraph
(or any portion of this paragraph) which may be defective or inconsistent with the intended beneficial ownership limitation contained
in this Section 3(d) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation
contained in this paragraph may not be waived and shall apply to a successor holder of this Note.

 

    	 	7	 

     

    

 

(e)          Right
of Alternate Conversion.

 

(i)          General.

 

(1)         Alternate
Conversion Upon an Event of Default. Subject to Section 3(d), at any time during the Event of Default Redemption Right Period
(as defined below), the Holder may, at the Holder’s option, convert (each, an “Alternate Conversion”,
and the date of such Alternate Conversion, each, an “Alternate Conversion Date”) all, or any part of, the Conversion
Amount (such portion of the Conversion Amount subject to an Alternate Conversion, each, an “Alternate Conversion Amount”)
into Ordinary Shares at the Alternate Conversion Price.

 

(ii)         Mechanics
of Alternate Conversion. On any Alternate Conversion Date, the Holder may voluntarily convert any Alternate Conversion Amount
pursuant to Section 3(c) (with “Alternate Conversion Price” replacing “Conversion Price” for all purposes
hereunder with respect to such Alternate Conversion and with “Redemption Premium of the Conversion Amount” replacing
“Conversion Amount” in clause (x) of the definition of Conversion Rate above with respect to such Alternate Conversion)
by designating in the Conversion Notice delivered pursuant to this Section 3(e) of this Note that the Holder is electing to use
the Alternate Conversion Price for such conversion. Notwithstanding anything to the contrary in this Section 3(e), but subject
to Section 3(d), until the Company delivers Ordinary Shares representing the applicable Alternate Conversion Amount to the Holder,
such Alternate Conversion Amount may be converted by the Holder into Ordinary Shares pursuant to Section 3(c) without regard to
this Section 3(e).

 

4.            RIGHTS
UPON EVENT OF DEFAULT.

 

(a)          Event
of Default. Each of the following events shall constitute an “Event of Default” and each of the events in
clauses (ix), (x) and (xi) shall constitute a “Bankruptcy Event of Default”:

 

(i)          the
failure of the applicable Registration Statement (as defined in the Registration Rights Agreement) to be filed with the SEC on
or prior to the date that is five (5) days after the applicable Filing Deadline (as defined in the Registration Rights Agreement)
or the failure of the applicable Registration Statement to be declared effective by the SEC on or prior to the date that is five
(5) Trading Days after the applicable Effectiveness Deadline (as defined in the Registration Rights Agreement);

 

    	 	8	 

     

    

 

(ii)         while
the applicable Registration Statement is required to be maintained effective pursuant to the terms of the Registration Rights Agreement,
the effectiveness of the applicable Registration Statement lapses for any reason (including, without limitation, the issuance of
a stop order) or such Registration Statement (or the prospectus contained therein) is unavailable to any holder of Registrable
Securities (as defined in the Registration Rights Agreement) for sale of all of such holder’s Registrable Securities in accordance
with the terms of the Registration Rights Agreement, and such lapse or unavailability continues for a period of five (5) consecutive
Trading Days or for more than an aggregate of ten (10) days in any 365-day period (excluding days during an Allowable Grace Period
(as defined in the Registration Rights Agreement));

 

(iii)        the
suspension (or threatened suspension) from trading or the failure (or threatened failure) of the Ordinary Shares to be trading
or listed (as applicable) on an Eligible Market for a period of five (5) consecutive Trading Days;

 

(iv)        the
Company’s (A) failure to cure a Conversion Failure or a Delivery Failure (as defined in the Warrants) by delivery of the
required number of Ordinary Shares within five (5) Trading Days after the applicable Conversion Date or exercise date (as the case
may be) or (B) notice, written or oral, to any holder of the Notes or Warrants, including, without limitation, by way of public
announcement or through any of its agents, at any time, of its intention not to comply, as required, with a request for conversion
of any Notes into Ordinary Shares that is requested in accordance with the provisions of the Notes, other than pursuant to Section
3(d), or a request for exercise of any Warrants for Ordinary Shares in accordance with the provisions of the Warrants;

 

(v)         except
to the extent the Company is in compliance with Section 10(b) below, at any time following the tenth (10th) consecutive
day that the Holder’s Authorized Share Allocation (as defined in Section 10(a) below) is less than (A) the number of Ordinary
Shares that the Holder would be entitled to receive upon a conversion of the full Conversion Amount of this Note (without regard
to any limitations on conversion set forth in Section 3(d) or otherwise), and (B) the number of Ordinary Shares that the Holder
would be entitled to receive upon exercise in full of the Holder’s Warrants (without regard to any limitations on exercise
set forth in the Warrants);

 

(vi)        the
Company’s or any Subsidiary’s failure to pay to the Holder any amount of Principal, Interest, Late Charges or other
amounts when and as due under this Note (including, without limitation, the Company’s or any Subsidiary’s failure to
pay any redemption payments or amounts hereunder) or any other Transaction Document (as defined in the Securities Purchase Agreement)
or any other agreement, document, certificate or other instrument delivered in connection with the transactions contemplated hereby
and thereby, except, in the case of a failure to pay Interest and Late Charges when and as due, in which case only if such failure
remains uncured for a period of at least two (2) Trading Days;

 

    	 	9	 

     

    

 

(vii)       the
Company fails to remove any restrictive legend on any certificate or any Ordinary Shares issued to the Holder upon conversion or
exercise (as the case may be) of any Securities (as defined in the Securities Purchase Agreement) acquired by the Holder under
the Securities Purchase Agreement (including this Note) as and when required by such Securities or the Securities Purchase Agreement,
unless otherwise then prohibited by applicable federal securities laws, and any such failure remains uncured for at least five
(5) days;

 

(viii)      the
occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $50,000 of Indebtedness
(as defined in the Securities Purchase Agreement) of the Company or any of its Subsidiaries, other than with respect to any Other
Notes;

 

(ix)         bankruptcy,
insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted by or
against the Company or any Subsidiary and, if instituted against the Company or any Subsidiary by a third party, shall not be dismissed
within thirty (30) days of their initiation;

 

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

 

(xi)         the
entry by a court of (i) a decree, order, judgment or other similar document in respect of the Company or any Subsidiary of a voluntary
or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or other
similar law or (ii) a decree, order, judgment or other similar document adjudging the Company or any Subsidiary as bankrupt or
insolvent, or approving as properly filed a petition seeking liquidation, reorganization, arrangement, adjustment or composition
of or in respect of the Company or any Subsidiary under any applicable federal, state or foreign law or (iii) a decree, order,
judgment or other similar document appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or any Subsidiary or of any substantial part of its property, or ordering the winding up or liquidation
of its affairs, and the continuance of any such decree, order, judgment or other similar document or any such other decree, order,
judgment or other similar document unstayed and in effect for a period of thirty (30) consecutive days;

 

    	 	10	 

     

    

 

(xii)        a
final judgment or judgments for the payment of money aggregating in excess of $50,000 are rendered against the Company and/or any
of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged, settled or
stayed pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however, any
judgment which is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the $50,000
amount set forth above so long as the Company provides the Holder a written statement from such insurer or indemnity provider (which
written statement shall be reasonably satisfactory to the Holder) to the effect that such judgment is covered by insurance or an
indemnity and the Company or such Subsidiary (as the case may be) will receive the proceeds of such insurance or indemnity within
thirty (30) days of the issuance of such judgment;

 

(xiii)       the
Company and/or any Subsidiary, individually or in the aggregate, either (i) fails to pay, when due, or within any applicable grace
period, any payment with respect to any Indebtedness in excess of $50,000 due to any third party (other than, with respect to unsecured
Indebtedness only, payments contested by the Company and/or such Subsidiary (as the case may be) in good faith by proper proceedings
and with respect to which adequate reserves have been set aside for the payment thereof in accordance with GAAP) or is otherwise
in breach or violation of any agreement for monies owed or owing in an amount in excess of $50,000, which breach or violation permits
the other party thereto to declare a default or otherwise accelerate amounts due thereunder, or (ii) suffer to exist any other
circumstance or event that would, with or without the passage of time or the giving of notice, result in a default or event of
default under any agreement binding the Company or any Subsidiary, which default or event of default would or is likely to have
a material adverse effect on the business, assets, operations (including results thereof), liabilities, properties, condition (including
financial condition) or prospects of the Company or any of its Subsidiaries, individually or in the aggregate;

 

(xiv)      other
than as specifically set forth in another clause of this Section 4(a), the Company or any Subsidiary breaches any representation
or warranty, in any material respect (other than representations or warranties subject to material adverse effect or materiality,
which may not be breached in any respect) or any covenant or other term or condition of any Transaction Document, except, in the
case of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured for a period of
two (2) consecutive Trading Days;

 

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

 

    	 	11	 

     

    

 

(xvi)      any
breach or failure in any respect by the Company or any Subsidiary to comply with any provision of Section 13 of this Note;

 

(xvii)     any
Material Adverse Effect (as defined in the Securities Purchase Agreement) occurs;

 

(xviii)    any
provision of any Transaction Document (including, without limitation, the Security Documents (as defined in the Securities Purchase
Agreement)) shall at any time for any reason (other than pursuant to the express terms thereof) cease to be valid and binding on
or enforceable against the parties thereto, or the validity or enforceability thereof shall be contested by any party thereto,
or a proceeding shall be commenced by the Company or any Subsidiary or any governmental authority having jurisdiction over any
of them, seeking to establish the invalidity or unenforceability thereof, or the Company or any Subsidiary shall deny in writing
that it has any liability or obligation purported to be created under any Transaction Document (including, without limitation,
the Security Documents);

 

(xix)       any
Security Document shall for any reason fail or cease to create a separate valid and perfected and, except to the extent permitted
by the terms hereof or thereof, first priority Lien (as defined in the Securities Purchase Agreement) on the Pledged Collateral
(as defined in the Pledge Agreement (as defined in the Securities Purchase Agreement)) in favor of the Secured Parties (as defined
in the Pledge Agreement) or any material provision of any Security Document shall at any time for any reason cease to be valid
and binding on or enforceable against the Company or the validity or enforceability thereof shall be contested by any party thereto,
or a proceeding shall be commenced by the Company or any governmental authority having jurisdiction over the Company, seeking to
establish the invalidity or unenforceability thereof; or

 

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

 

    	 	12	 

     

    

 

(b)          Notice
of an Event of Default; Redemption Right. Upon the occurrence of an Event of Default with respect to this Note or any Other
Note, the Company shall within one (1) Business Day deliver written notice thereof via facsimile or electronic mail and overnight
courier (with next day delivery specified) (an “Event of Default Notice”) to the Holder. At any time after the
earlier of the Holder’s receipt of an Event of Default Notice and the Holder becoming aware of an Event of Default, (such
earlier date, the “Event of Default Right Commencement Date”) and ending (such ending date, the “Event
of Default Right Expiration Date”, and each such period, an “Event of Default Redemption Right Period”)
on the twentieth (20th) Trading Day after the later of (x) the date such Event of Default is cured and (y) the Holder’s
receipt of an Event of Default Notice that includes (I) a reasonable description of the applicable Event of Default, (II) a certification
as to whether, in the opinion of the Company, such Event of Default is capable of being cured and, if applicable, a reasonable
description of any existing plans of the Company to cure such Event of Default and (III) a certification as to the date the Event
of Default occurred and, if cured on or prior to the date of such Event of Default Notice, the applicable Event of Default Right
Expiration Date, the Holder may require the Company to redeem (regardless of whether such Event of Default has been cured on or
prior to the Event of Default Right Expiration Date) all or any portion of this Note by delivering written notice thereof (the
“Event of Default Redemption Notice”) to the Company, which Event of Default Redemption Notice shall indicate
the portion of this Note the Holder is electing to redeem. Each portion of this Note subject to redemption by the Company pursuant
to this Section 4(b) shall be redeemed by the Company at a price equal to the greater of (i) the product of (A) the Conversion
Amount to be redeemed multiplied by (B) the Redemption Premium and (ii) the product of (X) the Conversion Rate with respect to
the Conversion Amount in effect at such time as the Holder delivers an Event of Default Redemption Notice multiplied by (Y) the
product of (1) the Redemption Premium multiplied by (2) the greatest Closing Sale Price of the Ordinary Shares on any Trading Day
during the period commencing on the date immediately preceding such Event of Default and ending on the date the Company makes the
entire payment required to be made under this Section 4(b) (the “Event of Default Redemption Price”). Redemptions
required by this Section 4(b) shall be made in accordance with the provisions of Section 11. To the extent redemptions required
by this Section 4(b) are deemed or determined by a court of competent jurisdiction to be prepayments of this Note by the Company,
such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section 3(e), but
subject to Section 3(d), until the Event of Default Redemption Price (together with any Late Charges thereon) is paid in full,
the Conversion Amount submitted for redemption under this Section 4(b) (together with any Late Charges thereon) may be converted,
in whole or in part, by the Holder into Ordinary Shares pursuant to the terms of this Note. In the event of a partial redemption
of this Note pursuant hereto, the Principal amount redeemed shall be deducted from the Installment Amount(s) relating to the applicable
Installment Date(s) as set forth in the Event of Default Redemption Notice shall be set forth in the applicable Event of Default
Redemption Notice. In the event of the Company’s redemption of any portion of this Note under this Section 4(b), the Holder’s
damages would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and
the uncertainty of the availability of a suitable substitute investment opportunity for the Holder. Accordingly, any redemption
premium due under this Section 4(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s
actual loss of its investment opportunity and not as a penalty. Any redemption upon an Event of Default shall not constitute an
election of remedies by the Holder, and all other rights and remedies of the Holder shall be preserved.

 

(c)          Mandatory
Redemption upon Bankruptcy Event of Default. Notwithstanding anything to the contrary herein, and notwithstanding any conversion
that is then required or in process, upon any Bankruptcy Event of Default, whether occurring prior to or following the Maturity
Date, the Company shall immediately pay to the Holder an amount in cash representing (i) all outstanding Principal, accrued and
unpaid Interest and accrued and unpaid Late Charges on such Principal and Interest, multiplied by (ii) the Redemption Premium,
in addition to any and all other amounts due hereunder, without the requirement for any notice or demand or other action by the
Holder or any other person or entity, provided that the Holder may, in its sole discretion, waive such right to receive payment
upon a Bankruptcy Event of Default, in whole or in part, and any such waiver shall not affect any other rights of the Holder hereunder,
including any other rights in respect of such Bankruptcy Event of Default, any right to conversion, and any right to payment of
the Event of Default Redemption Price or any other Redemption Price, as applicable.

 

    	 	13	 

     

    

 

5.            RIGHTS
UPON FUNDAMENTAL TRANSACTION.

 

(a)          Assumption.
The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes in writing
all of the obligations of the Company under this Note and the other Transaction Documents in accordance with the provisions of
this Section 5(a) pursuant to written agreements in form and substance satisfactory to the Holder and approved by the Holder prior
to such Fundamental Transaction, including agreements to deliver to each holder of Notes in exchange for such Notes a security
of the Successor Entity evidenced by a written instrument substantially similar in form and substance to the Notes, including,
without limitation, having a principal amount and interest rate equal to the principal amounts then outstanding and the interest
rates of the Notes held by such holder, having similar conversion rights as the Notes and having similar ranking and security to
the Notes, and satisfactory to the Holder and (ii) the Successor Entity (including its Parent Entity) is a publicly traded
corporation whose common equity is quoted on or listed for trading on an Eligible Market. Upon the occurrence of any 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. Upon consummation of a Fundamental Transaction, the Successor Entity shall deliver to the Holder confirmation
that there shall be issued upon conversion or redemption of this Note at any time after the consummation of such Fundamental Transaction,
in lieu of the Ordinary Shares (or other securities, cash, assets or other property (except such items still issuable under Sections
6 and 15, which shall continue to be receivable thereafter)) issuable upon the conversion or redemption of the Notes prior to such
Fundamental Transaction, such shares of the publicly traded common equity (or their equivalent) of the Successor Entity (including
its Parent Entity) which the Holder would have been entitled to receive upon the happening of such Fundamental Transaction had
this Note been converted immediately prior to such Fundamental Transaction (without regard to any limitations on the conversion
of this Note), as adjusted in accordance with the provisions of this Note. Notwithstanding the foregoing, the Holder may elect,
at its sole option, by delivery of written notice to the Company to waive this Section 5(a) to permit the Fundamental Transaction
without the assumption of this Note. The provisions of this Section 5 shall apply similarly and equally to successive Fundamental
Transactions and shall be applied without regard to any limitations on the conversion of this Note.

 

    	 	14	 

     

    

 

(b)          Notice
of a Change of Control; Redemption Right. No sooner than twenty (20) Trading Days nor later than ten (10) Trading Days prior
to the consummation of a Change of Control (the “Change of Control Date”), but not prior to the public announcement
of such Change of Control, the Company shall deliver written notice thereof via facsimile or electronic mail and overnight courier
to the Holder (a “Change of Control Notice”). At any time during the period beginning after the Holder’s
receipt of a Change of Control Notice or the Holder becoming aware of a Change of Control if a Change of Control Notice is not
delivered to the Holder in accordance with the immediately preceding sentence (as applicable) and ending on twenty (20) Trading
Days after the later of (A) the date of consummation of such Change of Control or (B) the date of receipt of such Change of Control
Notice or (C) the date of the announcement of such Change in Control, the Holder may require the Company to redeem all or any portion
of this Note by delivering written notice thereof (“Change of Control Redemption Notice”) to the Company, which
Change of Control Redemption Notice shall indicate the Conversion Amount the Holder is electing to redeem. The portion of this
Note subject to redemption pursuant to this Section 5 shall be redeemed by the Company in cash at a price equal to the greatest
of (i) the product of (w) the Change of Control Redemption Premium multiplied by (y) the Conversion Amount being redeemed, (ii)
the product of (x) the Change of Control Redemption Premium multiplied by (y) the product of (A) the Conversion Amount being redeemed
multiplied by (B) the quotient determined by dividing (I) the greatest Closing Sale Price of the Ordinary Shares during the period
beginning on the date immediately preceding the earlier to occur of (1) the consummation of the applicable Change of Control and
(2) the public announcement of such Change of Control and ending on the date the Holder delivers the Change of Control Redemption
Notice by (II) the Conversion Price then in effect and (iii) the product of (y) the Change of Control Redemption Premium multiplied
by (z) the product of (A) the Conversion Amount being redeemed multiplied by (B) the quotient of (I) the aggregate cash consideration
and the aggregate cash value of any non-cash consideration per Ordinary Share to be paid to the holders of the Ordinary Shares
upon consummation of such Change of Control (any such non-cash consideration constituting publicly-traded securities shall be valued
at the highest of the Closing Sale Price of such securities as of the Trading Day immediately prior to the consummation of such
Change of Control, the Closing Sale Price of such securities on the Trading Day immediately following the public announcement of
such proposed Change of Control and the Closing Sale Price of such securities on the Trading Day immediately prior to the public
announcement of such proposed Change of Control) divided by (II) the Conversion Price then in effect (the “Change of Control
Redemption Price”). Redemptions required by this Section 5 shall be made in accordance with the provisions of Section
11 and shall have priority to payments to shareholders in connection with such Change of Control. To the extent redemptions required
by this Section 5(b) are deemed or determined by a court of competent jurisdiction to be prepayments of this Note by the Company,
such redemptions shall be deemed to be voluntary prepayments. Notwithstanding anything to the contrary in this Section 5, but subject
to Section 3(d), until the Change of Control Redemption Price (together with any Late Charges thereon) is paid in full, the Conversion
Amount submitted for redemption under this Section 5(b) (together with any Late Charges thereon) may be converted, in whole or
in part, by the Holder into Ordinary Shares pursuant to Section 3. In the event of a partial redemption of this Note pursuant hereto
the Principal amount redeemed shall be deducted from the Installment Amount(s) relating to the applicable Installment Date(s) as
set forth in the Change of Control Redemption Notice shall be set forth in the applicable Change of Control Redemption Notice.
In the event of the Company’s redemption of any portion of this Note under this Section 5(b), the Holder’s damages
would be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty
of the availability of a suitable substitute investment opportunity for the Holder. Accordingly, any redemption premium due under
this Section 5(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of the Holder’s actual loss
of its investment opportunity and not as a penalty.

 

    	 	15	 

     

    

 

6.            RIGHTS
UPON ISSUANCE OF PURCHASE RIGHTS AND OTHER CORPORATE EVENTS.

 

(a)          Purchase
Rights. In addition to any adjustments pursuant to Section 7 below, if at any time the Company grants, issues or sells any
Options, Convertible Securities or rights to purchase shares, warrants, securities or other property pro rata to all or substantially
all of the record holders of any class of Ordinary Shares (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 Ordinary Shares acquirable upon complete conversion of this Note (without taking into account
any limitations or restrictions on the convertibility of this Note and assuming for such purpose that the Note was converted at
the Alternate Conversion Price as of the applicable record date) immediately prior to the date on which a record is taken for the
grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Ordinary
Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that to the
extent that the Holder’s right to participate in any such Purchase Right would result in the Holder and the other Attribution
Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Purchase Right to the extent
of the Maximum Percentage (and shall not be entitled to beneficial ownership of such Ordinary Shares as a result of such Purchase
Right (and beneficial ownership) to the extent of any such excess) and such Purchase Right to such extent shall be held in abeyance
(and, if such Purchase Right has an expiration date, maturity date or other similar provision, such term shall be extended by such
number of days held in abeyance, if applicable) for the benefit of the Holder until such time or times, if ever, as its right thereto
would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times the Holder
shall be granted such right (and any Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent
Purchase Right held similarly in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision,
such term shall be extended by such number of days held in abeyance, if applicable)) to the same extent as if there had been no
such limitation).

 

    	 	16	 

     

    

 

(b)          Other
Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation of any Fundamental
Transaction pursuant to which holders of Ordinary Shares are entitled to receive securities or other assets with respect to or
in exchange for Ordinary Shares (a “Corporate Event”), the Company shall make appropriate provision to ensure
that the Holder will thereafter have the right to receive upon a conversion of this Note, at the Holder’s option (i) in addition
to the Ordinary Shares receivable upon such conversion, such securities or other assets to which the Holder would have been entitled
with respect to such Ordinary Shares had such Ordinary Shares been held by the Holder upon the consummation of such Corporate Event
(without taking into account any limitations or restrictions on the convertibility of this Note) or (ii) in lieu of the Ordinary
Shares otherwise receivable upon such conversion, such securities or other assets received by the holders of Ordinary Shares in
connection with the consummation of such Corporate Event in such amounts as the Holder would have been entitled to receive had
this Note initially been issued with conversion rights for the form of such consideration (as opposed to Ordinary Shares) at a
conversion rate for such consideration commensurate with the Conversion Rate. Provision made pursuant to the preceding sentence
shall be in a form and substance satisfactory to the Holder. The provisions of this Section 6 shall apply similarly and equally
to successive Corporate Events and shall be applied without regard to any limitations on the conversion or redemption of this Note.

 

7.            RIGHTS
UPON ISSUANCE OF OTHER SECURITIES.

 

(a)          Adjustment
of Conversion Price upon Issuance of Ordinary Shares. If and whenever on or after the Subscription Date the Company issues
or sells, or in accordance with this Section 7(a) is deemed to have issued or sold, any Ordinary Shares (including the issuance
or sale of Ordinary Shares owned or held by or for the account of the Company, but excluding any Excluded Securities issued or
sold or deemed to have been issued or sold) for a consideration per share (the “New Issuance Price”) less than
a price equal to the Conversion Price in effect immediately prior to such issuance or sale or deemed issuance or sale (such Conversion
Price then in effect is referred to herein as the “Applicable Price”) (the foregoing a “Dilutive Issuance”),
then, immediately after such Dilutive Issuance, the Conversion Price then in effect shall be reduced to an amount equal to the
New Issuance Price. For all purposes of the foregoing (including, without limitation, determining the adjusted Conversion Price
and the New Issuance Price under this Section 7(a)), the following shall be applicable:

 

(i)          Issuance
of Options. If the Company in any manner grants or sells any Options and the lowest price per share for which one Ordinary
Share is at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Convertible
Securities issuable upon exercise of any such Option or otherwise pursuant to the terms thereof is less than the Applicable Price,
then such Ordinary Share shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the granting
or sale of such Option for such price per share. For purposes of this Section 7(a)(i), the “lowest price per share for which
one Ordinary Share is at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any
Convertible Securities issuable upon exercise of any such Option or otherwise pursuant to the terms thereof” shall be equal
to (1) the lower of (x) the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect
to any one Ordinary Share upon the granting or sale of such Option, upon exercise of such Option and upon conversion, exercise
or exchange of any Convertible Security issuable upon exercise of such Option or otherwise pursuant to the terms thereof and (y)
the lowest exercise price set forth in such Option for which one Ordinary Share is issuable (or may become issuable assuming all
possible market conditions) upon the exercise of any such Options or upon conversion, exercise or exchange of any Convertible Securities
issuable upon exercise of any such Option or otherwise pursuant to the terms thereof, minus (2) the sum of all amounts paid or
payable to the holder of such Option (or any other Person) with respect to any one Ordinary Share upon the granting or sale of
such Option, upon exercise of such Option and upon conversion, exercise or exchange of any Convertible Security issuable upon exercise
of such Option or otherwise pursuant to the terms thereof plus the value of any other consideration consisting of cash, debt forgiveness,
assets or any other property received or receivable by, or benefit conferred on, the holder of such Option (or any other Person).
Except as contemplated below, no further adjustment of the Conversion Price shall be made upon the actual issuance of such Ordinary
Share or of such Convertible Securities upon the exercise of such Options or otherwise pursuant to the terms thereof or upon the
actual issuance of such Ordinary Shares upon conversion, exercise or exchange of such Convertible Securities.

 

    	 	17	 

     

    

 

(ii)         Issuance
of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities and the lowest price per
share for which one Ordinary Share is at any time issuable upon the conversion, exercise or exchange thereof or otherwise pursuant
to the terms thereof is less than the Applicable Price, then such Ordinary Share shall be deemed to be outstanding and to have
been issued and sold by the Company at the time of the issuance or sale of such Convertible Securities for such price per share.
For the purposes of this Section 7(a)(ii), the “lowest price per share for which one Ordinary Share is at any time issuable
(or may become issuable assuming all possible market conditions) upon the conversion, exercise or exchange thereof or otherwise
pursuant to the terms thereof” shall be equal to (1) the lower of (x) the sum of the lowest amounts of consideration (if
any) received or receivable by the Company with respect to one Ordinary Share upon the issuance or sale of the Convertible Security
and upon conversion, exercise or exchange of such Convertible Security or otherwise pursuant to the terms thereof and (y) the lowest
conversion price set forth in such Convertible Security for which one Ordinary Share is issuable upon conversion, exercise or exchange
thereof or otherwise pursuant to the terms thereof minus (2) the sum of all amounts paid or payable to the holder of such Convertible
Security (or any other Person) with respect to any one Ordinary Share upon the issuance or sale of such Convertible Security plus
the value of any other consideration received or receivable consisting of cash, debt forgiveness, assets or other property by,
or benefit conferred on, the holder of such Convertible Security (or any other Person). Except as contemplated below, no further
adjustment of the Conversion Price shall be made upon the actual issuance of such Ordinary Shares upon conversion, exercise or
exchange of such Convertible Securities or otherwise pursuant to the terms thereof, and if any such issuance or sale of such Convertible
Securities is made upon exercise of any Options for which adjustment of the Conversion Price has been or is to be made pursuant
to other provisions of this Section 7(a), except as contemplated below, no further adjustment of the Conversion Price shall be
made by reason of such issuance or sale.

 

    	 	18	 

     

    

 

(iii)        Change
in Option Price or Rate of Conversion. If the purchase or exercise price provided for in any Options, the additional consideration,
if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exercisable or exchangeable for Ordinary Shares increases or decreases at any time (other than
proportional changes in conversion or exercise prices, as applicable, in connection with an event referred to in Section 7(b) below),
the Conversion Price in effect at the time of such increase or decrease shall be adjusted to the Conversion Price which would have
been in effect at such time had such Options or Convertible Securities provided for such increased or decreased purchase price,
additional consideration or increased or decreased conversion rate (as the case may be) at the time initially granted, issued or
sold. For purposes of this Section 7(a)(iii), if the terms of any Option or Convertible Security that was outstanding as of the
Subscription Date are increased or decreased in the manner described in the immediately preceding sentence, then such Option or
Convertible Security and the Ordinary Shares deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have
been issued as of the date of such increase or decrease. No adjustment pursuant to this Section 7(a) shall be made if such adjustment
would result in an increase of the Conversion Price then in effect.

 

(iv)        Calculation
of Consideration Received. If any Option and/or Convertible Security and/or Adjustment Right is issued in connection with the
issuance or sale or deemed issuance or sale of any other securities of the Company (as determined by the Holder, the “Primary
Security”, and such Option and/or Convertible Security and/or Adjustment Right, the “Secondary Securities”),
together comprising one integrated transaction (or one or more transactions if such issuances or sales or deemed issuances or sales
of securities of the Company either (A) have at least one investor or purchaser in common, (B) are consummated in reasonable proximity
to each other and/or (C) are consummated under the same plan of financing), the aggregate consideration per Ordinary Share with
respect to such Primary Security shall be deemed to be equal to the difference of (x) the lowest price per share for which one
Ordinary Share was issued (or was deemed to be issued pursuant to Section 7(a)(i) or 7(a)(ii) above, as applicable) in such integrated
transaction solely with respect to such Primary Security, minus (y) with respect to such Secondary Securities, the sum of (I) the
Black Scholes Consideration Value of each such Option, if any, (II) the fair market value (as determined by the Holder in good
faith) or the Black Scholes Consideration Value, as applicable, of such Adjustment Right, if any, and (III) the fair market value
(as determined by the Holder) of such Convertible Security, if any, in each case, as determined on a per share basis in accordance
with this Section 7(a)(i). If any Ordinary Shares, Options or Convertible Securities are issued or sold or deemed to have been
issued or sold for cash, the consideration received therefor (for the purpose of determining the consideration paid for such Ordinary
Shares, Option or Convertible Security, but not for the purpose of the calculation of the Black Scholes Consideration Value) will
be deemed to be the net amount of consideration received by the Company therefor. If any Ordinary Shares, Options or Convertible
Securities are issued or sold for a consideration other than cash, the amount of such consideration received by the Company (for
the purpose of determining the consideration paid for such Ordinary Shares, Option or Convertible Security, but not for the purpose
of the calculation of the Black Scholes Consideration Value) will be the fair value of such consideration, except where such consideration
consists of publicly traded securities, in which case the amount of consideration received by the Company for such securities will
be the arithmetic average of the VWAPs of such security for each of the five (5) Trading Days immediately preceding the date of
receipt. If any Ordinary Shares, Options or Convertible Securities are issued to the owners of the non-surviving entity in connection
with any merger in which the Company is the surviving entity, the amount of consideration therefor (for the purpose of determining
the consideration paid for such Ordinary Shares, Option or Convertible Security, but not for the purpose of the calculation of
the Black Scholes Consideration Value) will be deemed to be the fair value of such portion of the net assets and business of the
non-surviving entity as is attributable to such Ordinary Shares, Options or Convertible Securities (as the case may be). The fair
value of any consideration other than cash or publicly traded securities will be determined jointly by the Company and the Holder.
If such parties are unable to reach agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation
Event”), the fair value of such consideration will be determined within five (5) Trading Days after the tenth (10th)
day following such Valuation Event by an independent, reputable appraiser jointly selected by the Company and the Holder. The determination
of such appraiser shall be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser
shall be borne by the Company.

 

    	 	19	 

     

    

 

(v)         Record
Date. If the Company takes a record of the holders of Ordinary Shares for the purpose of entitling them (A) to receive a dividend
or other distribution payable in Ordinary Shares, Options or in Convertible Securities or (B) to subscribe for or purchase Ordinary
Shares, Options or Convertible Securities, then such record date will be deemed to be the date of the issuance or sale of the Ordinary
Shares deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the
date of the granting of such right of subscription or purchase (as the case may be).

 

(b)          Adjustment
of Conversion Price upon Subdivision or Combination of Ordinary Shares. Without limiting any provision of Section 4(c) or Section
7(a), if the Company at any time on or after the Subscription Date subdivides (by any share split, share dividend, share combination,
recapitalization or other similar transaction) one or more classes of its outstanding Ordinary Shares into a greater number of
shares, the Conversion Price in effect immediately prior to such subdivision will be proportionately reduced. Without limiting
any provision of Section 6, Section 15 or Section 7(a), if the Company at any time on or after the Subscription Date
combines (by any share split, share dividend, share combination, recapitalization or other similar transaction) one or more classes
of its outstanding Ordinary Shares into a smaller number of shares, the Conversion Price in effect immediately prior to such combination
will be proportionately increased. Any adjustment pursuant to this Section 7(b) shall become effective immediately after the effective
date of such subdivision or combination. If any event requiring an adjustment under this Section 7(b) occurs during the period
that a Conversion Price is calculated hereunder, then the calculation of such Conversion Price shall be adjusted appropriately
to reflect such event.

 

    	 	20	 

     

    

 

(c)           Holder’s
Right of Adjusted Conversion Price. In addition to and not in limitation of the other provisions of this Section 7, if the
Company in any manner issues or sells or enters into any agreement (including, without limitation, an equity line of credit or
an “at-the-market” offering) to issue or sell, any Ordinary Shares, Options or Convertible Securities (any such securities,
“Variable Price Securities”), after the Subscription Date that are issuable pursuant to such agreement or convertible
into or exchangeable or exercisable for Ordinary Shares at a price which varies or may vary with the market price of the Ordinary
Shares, including by way of one or more reset(s) to a fixed price, but exclusive of such formulations reflecting customary anti-dilution
provisions (such as share splits, share combinations, share dividends and similar transactions) (each of the formulations for such
variable price being herein referred to as, the “Variable Price”), the Company shall provide written notice
thereof via facsimile and overnight courier to the Holder on the date of such agreement and the issuance of such Variable Price
Securities. From and after the date the Company enters into such agreement or issues any such Variable Price Securities, the Holder
shall have the right, but not the obligation, in its sole discretion to substitute the Variable Price for the Conversion Price
upon conversion of this Note by designating in the Conversion Notice delivered upon any conversion of this Note that solely for
purposes of such conversion the Holder is relying on the Variable Price rather than the Conversion Price then in effect. The Holder’s
election to rely on a Variable Price for a particular conversion of this Note shall not obligate the Holder to rely on a Variable
Price for any future conversion of this Note. In addition, from and after the date the Company enters into such agreement or issues
any such Variable Price Securities, for purposes of calculating the Installment Conversion Price as of any time of determination,
the “Conversion Price” as used therein shall mean the lower of (x) the Conversion Price as of such time of determination
and (y) the Variable Price as of such time of determination.

 

(d)          Share
Combination Event Adjustments. If at any time and from time to time on or after the Subscription Date there occurs any share
split, share dividend, share combination recapitalization or other similar transaction involving the Ordinary Shares (each, a “Share
Combination Event”, and such date thereof, the “Share Combination Event Date”) and the Event Market
Price is less than the Conversion Price then in effect (after giving effect to the adjustment in Section 7(b) above), then on the
sixteenth (16th) Trading Day immediately following such Share Combination Event Date, the Conversion Price then in effect
on such sixteenth (16th) Trading Day (after giving effect to the adjustment in Section 7(b) above) shall be reduced
(but in no event increased) to the Event Market Price. For the avoidance of doubt, if the adjustment in the immediately preceding
sentence would otherwise result in an increase in the Conversion Price hereunder, no adjustment shall be made.

 

    	 	21	 

     

    

 

(e)          Other
Events. In the event that the Company (or any Subsidiary) shall take any action to which the provisions hereof are not strictly
applicable, or, if applicable, would not operate to protect the Holder from dilution or if any event occurs of the type contemplated
by the provisions of this Section 7 but not expressly provided for by such provisions (including, without limitation, the granting
of share appreciation rights, phantom share rights or other rights with equity features), then the Company’s board of directors
shall in good faith determine and implement an appropriate adjustment in the Conversion Price so as to protect the rights of the
Holder, provided that no such adjustment pursuant to this Section 7(e) will increase the Conversion Price as otherwise determined
pursuant to this Section 7, provided further that if the Holder does not accept such adjustments as appropriately protecting its
interests hereunder against such dilution, then the Company’s board of directors and the Holder shall agree, in good faith,
upon an independent investment bank of nationally recognized standing to make such appropriate adjustments, whose determination
shall be final and binding absent manifest error and whose fees and expenses shall be borne by the Company.

 

(f)          Calculations.
All calculations under this Section 7 shall be made by rounding to the nearest cent or the nearest 1/100th of a
share, as applicable. The number of Ordinary Shares outstanding at any given time shall not include shares owned or held by or
for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Ordinary Shares.

 

(g)          Voluntary
Adjustment by Company. The Company may at any time during the term of this Note, with the prior written consent of the Required
Holders (as defined in the Securities Purchase Agreement), reduce the then current Conversion Price of each of the Notes to any
amount and for any period of time deemed appropriate by the board of directors of the Company.

 

8.            INSTALLMENT
CONVERSION OR REDEMPTION.

 

(a)          General.
On each applicable Installment Date, provided there has been no Equity Conditions Failure, the Company shall pay to the Holder
of this Note the applicable Installment Amount due on such date by converting such Installment Amount in accordance with this Section
8 (a “Installment Conversion”); provided, however, that the Company may, at its option following
notice to the Holder as set forth below, pay the Installment Amount by redeeming such Installment Amount in cash (a “Installment
Redemption”) or by any combination of an Installment Conversion and an Installment Redemption so long as all of the outstanding
applicable Installment Amount due on any Installment Date shall be converted and/or redeemed by the Company on the applicable Installment
Date, subject to the provisions of this Section 8. On the date which is the eleventh (11th) Trading Day prior to each Installment
Date (each, an “Installment Notice Due Date”), the Company shall deliver written notice (each, a “Installment
Notice” and the date all of the holders receive such notice is referred to as to the “Installment Notice Date”),
to each holder of Notes and such Installment Notice shall (i) either (A) confirm that the applicable Installment Amount of such
holder’s Note shall be converted in whole pursuant to an Installment Conversion or (B) (1) state that the Company elects
to redeem for cash, or is required to redeem for cash in accordance with the provisions of the Notes, in whole or in part, the
applicable Installment Amount pursuant to an Installment Redemption and (2) specify the portion of such Installment Amount which
the Company elects or is required to redeem pursuant to an Installment Redemption (such amount to be redeemed in cash, the “Installment
Redemption Amount”) and the portion of the applicable Installment Amount, if any, with respect to which the Company will,
and is permitted to, effect an Installment Conversion (such amount of the applicable Installment Amount so specified to be so converted
pursuant to this Section 8 is referred to herein as the “Installment Conversion Amount”), which amounts when
added together, must at least equal the entire applicable Installment Amount and (ii) if the applicable Installment Amount is to
be paid, in whole or in part, pursuant to an Installment Conversion, certify that there is not then an Equity Conditions Failure
as of the applicable Installment Notice Date. Each Installment Notice shall be irrevocable. If the Company does not timely deliver
an Installment Notice in accordance with this Section 8 with respect to a particular Installment Date, then the Company shall be
deemed to have delivered an irrevocable Installment Notice confirming an Installment Conversion of the entire Installment Amount
payable on such Installment Date and shall be deemed to have certified that there is not then an Equity Conditions Failure in connection
with such Installment Conversion. Except as expressly provided in this Section 8(a), the Company shall convert and/or redeem the
applicable Installment Amount of this Note pursuant to this Section 8 and the corresponding Installment Amounts of the Other Notes
pursuant to the corresponding provisions of the Other Notes in the same ratio of the applicable Installment Amount being converted
and/or redeemed hereunder. The applicable Installment Conversion Amount (whether set forth in the applicable Installment Notice
or by operation of this Section 8) shall be converted in accordance with Section 8(b) and the applicable Installment Redemption
Amount shall be redeemed in accordance with Section 8(c).

 

    	 	22	 

     

    

 

(b)        Mechanics
of Installment Conversion. Subject to Section 3(d), if the Company delivers an Installment Notice or is deemed to have delivered
an Installment Notice certifying that such Installment Amount is being paid, in whole or in part, in an Installment Conversion
in accordance with Section 8(a), then the remainder of this Section 8(b) shall apply. The applicable Installment Conversion Amount,
if any, shall be converted on the applicable Installment Date at the applicable Installment Conversion Price and the Company shall,
on such Installment Date, deliver to the Holder’s account with DTC such Ordinary Shares issued upon such conversion (subject
to the reduction contemplated by the immediately following sentence and, if applicable, the penultimate sentence of this Section
8(b)), provided that the Equity Conditions are then satisfied (or waived in writing by the Holder) on such Installment Date and
an Installment Conversion is not otherwise prohibited under any other provision of this Note. If the Company confirmed (or is deemed
to have confirmed by operation of Section 8(a)) the conversion of the applicable Installment Conversion Amount, in whole or in
part, and there was no Equity Conditions Failure as of the applicable Installment Notice Date (or is deemed to have certified that
the Equity Conditions in connection with any such conversion have been satisfied by operation of Section 8(a)) but an Equity Conditions
Failure occurred between the applicable Installment Notice Date and any time through the applicable Installment Date (the “Interim
Installment Period”), the Company shall provide the Holder a subsequent notice to that effect. If there is an Equity
Conditions Failure (which is not waived in writing by the Holder) during such Interim Installment Period or an Installment Conversion
is not otherwise permitted under any other provision of this Note, then, at the option of the Holder designated in writing to the
Company, the Holder may require the Company to do any one or more of the following: (i) the Company shall redeem all or any part
designated by the Holder of the unconverted Installment Conversion Amount (such designated amount is referred to as the “Designated
Redemption Amount”) and the Company shall pay to the Holder within two (2) days of such Installment Date, by wire transfer
of immediately available funds, an amount in cash equal to 110% of such Designated Redemption Amount, and/or (ii) the Installment
Conversion shall be null and void with respect to all or any part designated by the Holder of the unconverted Installment Conversion
Amount and the Holder shall be entitled to all the rights of a holder of this Note with respect to such designated part of the
Installment Conversion Amount; provided, however, the Conversion Price for such designated part of such unconverted Installment
Conversion Amount shall thereafter be adjusted to equal the lesser of (A) the Installment Conversion Price as in effect on the
date on which the Holder voided the Installment Conversion and (B) the Installment Conversion Price that would be in effect on
the date on which the Holder delivers a Conversion Notice relating thereto as if such date was an Installment Date. If the Company
fails to redeem any Designated Redemption Amount by the second (2nd) day following the applicable Installment Date by payment of
such amount by such date, then the Holder shall have the rights set forth in Section 11(a) as if the Company failed to pay the
applicable Installment Redemption Price (as defined below) and all other rights under this Note (including, without limitation,
such failure constituting an Event of Default described in Section 4(a)(vi)). Notwithstanding anything to the contrary in this
Section 8(b), but subject to 3(d), until the Company delivers Ordinary Shares representing the Installment Conversion Amount to
the Holder, the Installment Conversion Amount may be converted by the Holder into Ordinary Shares pursuant to Section 3. In the
event that the Holder elects to convert the Installment Conversion Amount prior to the applicable Installment Date as set forth
in the immediately preceding sentence, the Installment Conversion Amount so converted shall be deducted from the Installment Amount(s)
relating to the applicable Installment Date(s) as set forth in the applicable Conversion Notice. The Company shall pay any and
all taxes that may be payable with respect to the issuance and delivery of any Ordinary Shares in any Installment Conversion hereunder.

 

    	 	23	 

     

    

 

(c)          Mechanics
of Installment Redemption. If the Company elects or is required to effect an Installment Redemption, in whole or in part, in
accordance with Section 8(a), then the Installment Redemption Amount, if any, shall be redeemed by the Company in cash on the applicable
Installment Date by wire transfer to the Holder of immediately available funds in an amount equal to 106% of the applicable Installment
Redemption Amount (the “Installment Redemption Price”). If the Company fails to redeem such Installment Redemption
Amount on such Installment Date by payment of the Installment Redemption Price, then, at the option of the Holder designated in
writing to the Company (any such designation shall be a “Conversion Notice” for purposes of this Note), the
Holder may require the Company to convert all or any part of the Installment Redemption Amount at the Installment Conversion Price
(determined as of the date of such designation as if such date were an Installment Date). Conversions required by this Section
8(c) shall be made in accordance with the provisions of Section 3(c). Notwithstanding anything to the contrary in this Section
8(c), but subject to Section 3(d), until the Installment Redemption Price (together with any Late Charges thereon) is paid in full,
the Installment Redemption Amount (together with any Late Charges thereon) may be converted, in whole or in part, by the Holder
into Ordinary Shares pursuant to Section 3. In the event the Holder elects to convert all or any portion of the Installment Redemption
Amount prior to the applicable Installment Date as set forth in the immediately preceding sentence, the Installment Redemption
Amount so converted shall be deducted from the Installment Amounts relating to the applicable Installment Date(s) as set forth
in the applicable Conversion Notice. Redemptions required by this Section 8(c) shall be made in accordance with the provisions
of Section 11.

 

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

 

(e)          Acceleration
of Installment Amounts. Notwithstanding anything herein to the contrary, during the period commencing on an Installment Date
(a “Current Installment Date”) and ending on the Trading Day immediately prior to the next Installment Date
(each, an “Installment Period”), at the option of the Holder, at one or more times, the Holder may convert other
Installment Amounts (each, an “Acceleration”, and each such amount, an “Acceleration Amount”),
in whole or in part, at the Installment Conversion Price of such Current Installment Date in accordance with the conversion procedures
set forth in Section 3 hereunder, mutatis mutandis. Notwithstanding the foregoing, with respect to any given Installment
Period, the Holder may not elect to effect any Acceleration (a “Current Acceleration”) during such Installment
Period if the sum of (x) the Acceleration Amounts with respect to Accelerations previously consummated by the Holder during the
applicable Installment Period and (y) the Acceleration Amount of such Current Acceleration, collectively, exceeds five (5) times
the Installment Amount with respect to such Current Installment Date.

 

9.            NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment of its Memorandum of Association (as defined in
the Securities Purchase Agreement), Articles of Association (as defined in the Securities Purchase Agreement) or through any reorganization,
transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will at all times in good faith
carry out all of the provisions of this Note and take all action as may be required to protect the rights of the Holder of this
Note. Without limiting the generality of the foregoing or any other provision of this Note or the other Transaction Documents,
the Company (a) shall not increase the par value of any Ordinary Shares receivable upon conversion of this Note above the
Conversion Price then in effect, and (b) shall take all such actions as may be necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable Ordinary Shares upon the conversion of this Note. Notwithstanding
anything herein to the contrary, if after the sixty (60) calendar day anniversary of the Issuance Date, the Holder is not permitted
to convert this Note in full for any reason (other than pursuant to restrictions set forth in Section 3(d) hereof), the Company
shall use its best efforts to promptly remedy such failure, including, without limitation, obtaining such consents or approvals
as necessary to permit such conversion into Ordinary Shares.

 

    	 	24	 

     

    

 

10.          RESERVATION
OF AUTHORIZED SHARES.

 

(a)          Reservation.
So long as any Notes remain outstanding, the Company shall at all times reserve at least 150% of the number of Ordinary Shares
as shall from time to time be necessary to effect the conversion, including without limitation, Installment Conversions, Alternate
Conversions and Accelerations, of all of the Notes then outstanding (without regard to any limitations on conversions and assuming
such Notes remain outstanding until the Maturity Date) at the Alternate Conversion Price then in effect (the “Required
Reserve Amount”). The Required Reserve Amount (including, without limitation, each increase in the number of shares so
reserved) shall be allocated pro rata among the holders of the Notes based on the original principal amount of the Notes held by
each holder on the Closing Date or increase in the number of reserved shares, as the case may be (the “Authorized Share
Allocation”). In the event that a holder shall sell or otherwise transfer any of such holder’s Notes, each transferee
shall be allocated a pro rata portion of such holder’s Authorized Share Allocation. Any Ordinary Shares reserved and allocated
to any Person which ceases to hold any Notes shall be allocated to the remaining holders of Notes, pro rata based on the principal
amount of the Notes then held by such holders.

 

(b)          Insufficient
Authorized Shares. If, notwithstanding Section 10(a), and not in limitation thereof, at any time while any of the Notes remain
outstanding the Company does not have a sufficient number of authorized and unreserved Ordinary Shares to satisfy its obligation
to reserve for issuance upon conversion of the Notes at least a number of Ordinary Shares equal to the Required Reserve Amount
(an “Authorized Share Failure”), then the Company shall immediately take all action necessary to increase the
Company’s authorized Ordinary Shares to an amount sufficient to allow the Company to reserve the Required Reserve Amount
for the Notes then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date
of the occurrence of an Authorized Share Failure, but in no event later than sixty (60) days after the occurrence of such Authorized
Share Failure, the Company shall hold a meeting of its shareholders for the approval of an increase in the number of authorized
Ordinary Shares. In connection with such meeting, the Company shall provide each shareholder with a proxy statement and shall use
its best efforts to solicit its shareholders’ approval of such increase in authorized Ordinary Shares and to cause its board
of directors to recommend to the shareholders that they approve such proposal. In the event that the Company is prohibited from
issuing Ordinary Shares pursuant to the terms of this Note due to the failure by the Company to have sufficient Ordinary Shares
available out of the authorized but unissued Ordinary Shares (such unavailable number of Ordinary Shares, the “Authorized
Failure Shares”), in lieu of delivering such Authorized Failure Shares to the Holder, the Company shall pay cash in exchange
for the redemption of such portion of the Conversion Amount convertible into such Authorized Failure Shares at a price equal to
the sum of (i) the product of (x) such number of Authorized Failure Shares and (y) the greatest Closing Sale Price of the Ordinary
Shares on any Trading Day during the period commencing on the date the Holder delivers the applicable Conversion Notice with respect
to such Authorized Failure Shares to the Company and ending on the date of such issuance and payment under this Section 10(a);
and (ii) to the extent the Holder purchases (in an open market transaction or otherwise) Ordinary Shares to deliver in satisfaction
of a sale by the Holder of Authorized Failure Shares, any brokerage commissions and other out-of-pocket expenses, if any, of the
Holder incurred in connection therewith. Nothing contained in Section 10(a) or this Section 10(b) shall limit any obligations of
the Company under any provision of the Securities Purchase Agreement.

 

    	 	25	 

     

    

 

11.          REDEMPTIONS.

 

(a)          Mechanics.
The Company shall deliver the applicable Event of Default Redemption Price to the Holder in cash within five (5) Business Days
after the Company’s receipt of the Holder’s Event of Default Redemption Notice. If the Holder has submitted a Change
of Control Redemption Notice in accordance with Section 5(b), the Company shall deliver the applicable Change of Control Redemption
Price to the Holder in cash concurrently with the consummation of such Change of Control if such notice is received prior to the
consummation of such Change of Control and within five (5) Business Days after the Company’s receipt of such notice otherwise.
The Company shall deliver the applicable Installment Redemption Price to the Holder in cash on the applicable Installment Date.
Notwithstanding anything herein to the contrary, in connection with any redemption hereunder at a time the Holder is entitled to
receive a cash payment under any of the other Transaction Documents, at the option of the Holder delivered in writing to the Company,
the applicable Redemption Price hereunder shall be increased by the amount of such cash payment owed to the Holder under such other
Transaction Document and, upon payment in full or conversion in accordance herewith, shall satisfy the Company’s payment
obligation under such other Transaction Document. In the event of a redemption of less than all of the Conversion Amount of this
Note, the Company shall promptly cause to be issued and delivered to the Holder a new Note (in accordance with Section 18(d)) representing
the outstanding Principal which has not been redeemed. In the event that the Company does not pay the applicable Redemption Price
to the Holder within the time period required, at any time thereafter and until the Company pays such unpaid Redemption Price in
full, the Holder shall have the option, in lieu of redemption, to require the Company to promptly return to the Holder all or any
portion of this Note representing the Conversion Amount that was submitted for redemption and for which the applicable Redemption
Price (together with any Late Charges thereon) has not been paid. Upon the Company’s receipt of such notice, (x) the applicable
Redemption Notice shall be null and void with respect to such Conversion Amount, (y) the Company shall immediately return this
Note, or issue a new Note (in accordance with Section 18(d)), to the Holder, and in each case the principal amount of this
Note or such new Note (as the case may be) shall be increased by an amount equal to the difference between (1) the applicable Redemption
Price (as the case may be, and as adjusted pursuant to this Section 11, if applicable) minus (2) the Principal portion of the Conversion
Amount submitted for redemption and (z) the Conversion Price of this Note or such new Notes (as the case may be) shall be automatically
adjusted with respect to each conversion effected thereafter by the Holder to the lowest of (A) the Conversion Price as in effect
on the date on which the applicable Redemption Notice is voided, (B) 75% of the lowest Closing Bid Price of the Ordinary Shares
during the period beginning on and including the date on which the applicable Redemption Notice is delivered to the Company and
ending on and including the date on which the applicable Redemption Notice is voided and (C) 75% of the quotient of (I) the sum
of the five (5) lowest VWAPs of the Ordinary Shares during the twenty (20) consecutive Trading Day period ending and including
the applicable Conversion Date divided by (II) five (5) (it being understood and agreed that all such determinations shall be appropriately
adjusted for any share dividend, share split, share combination or other similar transaction during such period). The Holder’s
delivery of a notice voiding a Redemption Notice and exercise of its rights following such notice shall not affect the Company’s
obligations to make any payments of Late Charges which have accrued prior to the date of such notice with respect to the Conversion
Amount subject to such notice.

 

    	 	26	 

     

    

 

(b)          Redemption
by Other Holders. Upon the Company’s receipt of notice from any of the holders of the Other Notes for redemption or repayment
as a result of an event or occurrence substantially similar to the events or occurrences described in Section 4(b) or Section 5(b)
(each, an “Other Redemption Notice”), the Company shall immediately, but no later than one (1) Business Day
of its receipt thereof, forward to the Holder by facsimile or electronic mail a copy of such notice. If the Company receives a
Redemption Notice and one or more Other Redemption Notices, during the seven (7) Business Day period beginning on and including
the date which is two (2) Business Days prior to the Company’s receipt of the Holder’s applicable Redemption Notice
and ending on and including the date which is two (2) Business Days after the Company’s receipt of the Holder’s applicable
Redemption Notice and the Company is unable to redeem all principal, interest and other amounts designated in such Redemption Notice
and such Other Redemption Notices received during such seven (7) Business Day period, then the Company shall redeem a pro rata
amount from each holder of the Notes (including the Holder) based on the principal amount of the Notes submitted for redemption
pursuant to such Redemption Notice and such Other Redemption Notices received by the Company during such seven (7) Business Day
period.

 

12.          VOTING
RIGHTS. The Holder shall have no voting rights as the holder of this Note, except as required by law (including, without limitation,
the Cayman Islands Company Law) and as expressly provided in this Note.

 

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

 

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

 

    	 	27	 

     

    

 

(b)          Incurrence
of Indebtedness. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
incur or guarantee, assume or suffer to exist any Indebtedness (other than (i) the Indebtedness evidenced by this Note and the
Other Notes and (ii) other Permitted Indebtedness).

 

(c)          Existence
of Liens. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, allow
or suffer to exist any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by the Company or any of its Subsidiaries (collectively, “Liens”)
other than Permitted Liens.

 

(d)          Restricted
Payments. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, redeem,
defease, repurchase, repay or make any payments in respect of, by the payment of cash or cash equivalents (in whole or in part,
whether by way of open market purchases, tender offers, private transactions or otherwise), all or any portion of any Indebtedness
(other than the Notes) whether by way of payment in respect of principal of (or premium, if any) or interest on, such Indebtedness
if at the time such payment is due or is otherwise made or, after giving effect to such payment, (i) an event constituting an Event
of Default has occurred and is continuing or (ii) an event that with the passage of time and without being cured would constitute
an Event of Default has occurred and is continuing.

 

(e)          Restriction
on Redemption and Cash Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly
or indirectly, redeem, repurchase or declare or pay any cash dividend or distribution on any of its share capital.

 

(f)          Restriction
on Transfer of Assets. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
sell, lease, license, assign, transfer, spin-off, split-off, close, convey or otherwise dispose of any assets or rights of the
Company or any Subsidiary owned or hereafter acquired whether in a single transaction or a series of related transactions, other
than (i) sales, leases, licenses, assignments, transfers, conveyances and other dispositions of such assets or rights by the Company
and its Subsidiaries in the ordinary course of business consistent with its past practice and (ii) sales of inventory and product
in the ordinary course of business.

 

(g)          Maturity
of Indebtedness. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
permit any Indebtedness of the Company or any of its Subsidiaries to mature or accelerate prior to the Maturity Date.

 

(h)          Change
in Nature of Business. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly,
engage in any material line of business substantially different from those lines of business conducted by or publicly contemplated
to be conducted by the Company and each of its Subsidiaries on the Subscription Date or any business substantially related or incidental
thereto. The Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, modify its
or their corporate structure or purpose.

 

    	 	28	 

     

    

 

(i)            Preservation
of Existence, Etc. The Company shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its
existence, rights and privileges, and become or remain, and cause each of its Subsidiaries to become or remain, duly qualified
and in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction
of its business makes such qualification necessary.

 

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

 

(k)           Maintenance
of Intellectual Property. The Company will, and will cause each of its Subsidiaries to, take all action necessary or advisable
to maintain all of the Intellectual Property Rights (as defined in the Securities Purchase Agreement) of the Company and/or any
of its Subsidiaries that are necessary or material to the conduct of its business in full force and effect.

 

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

 

(m)          Transactions
with Affiliates. The Company shall not, nor shall it permit any of its Subsidiaries to, enter into, renew, extend or be a party
to, any transaction or series of related transactions (including, without limitation, the purchase, sale, lease, transfer or exchange
of property or assets of any kind or the rendering of services of any kind) with any affiliate, except transactions in the ordinary
course of business in a manner and to an extent consistent with past practice and necessary or desirable for the prudent operation
of its business, for fair consideration and on terms no less favorable to it or its Subsidiaries than would be obtainable in a
comparable arm’s length transaction with a Person that is not an affiliate thereof.

 

(n)           Restricted
Issuances. The Company shall not, directly or indirectly, without the prior written consent of the holders of a majority in
aggregate principal amount of the Notes then outstanding, (i) issue any Notes (other than as contemplated by the Securities Purchase
Agreement and the Notes) or (ii) issue any other securities that would cause a breach or default under the Notes or the Warrants.

 

    	 	29	 

     

    

 

(o)          Independent
Investigation. At the request of the Holder either (x) at any time when an Event of Default has occurred and is continuing,
(y) upon the occurrence of an event that with the passage of time or giving of notice would constitute an Event of Default or (z)
at any time the Holder reasonably believes an Event of Default may have occurred or be continuing, the Company shall hire an independent,
reputable investment bank selected by the Company and approved by the Holder to investigate as to whether any breach of this Note
has occurred (the “Independent Investigator”). If the Independent Investigator determines that such breach of
this Note has occurred, the Independent Investigator shall notify the Company of such breach and the Company shall deliver written
notice to each holder of a Note of such breach. In connection with such investigation, the Independent Investigator may, during
normal business hours, inspect all contracts, books, records, personnel, offices and other facilities and properties of the Company
and its Subsidiaries and, to the extent available to the Company after the Company uses reasonable efforts to obtain them, the
records of its legal advisors and accountants (including the accountants’ work papers) and any books of account, records,
reports and other papers not contractually required of the Company to be confidential or secret, or subject to attorney-client
or other evidentiary privilege, and the Independent Investigator may make such copies and inspections thereof as the Independent
Investigator may reasonably request. The Company shall furnish the Independent Investigator with such financial and operating data
and other information with respect to the business and properties of the Company as the Independent Investigator may reasonably
request. The Company shall permit the Independent Investigator to discuss the affairs, finances and accounts of the Company with,
and to make proposals and furnish advice with respect thereto to, the Company’s officers, directors, key employees and independent
public accountants or any of them (and by this provision the Company authorizes said accountants to discuss with such Independent
Investigator the finances and affairs of the Company and any Subsidiaries), all at such reasonable times, upon reasonable notice,
and as often as may be reasonably requested.

 

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

 

15.          DISTRIBUTION
OF ASSETS. In addition to any adjustments pursuant to Section 7, if the Company shall declare or make any dividend or other
distributions of its assets (or rights to acquire its assets) to any or all holders of Ordinary Shares, by way of return of capital
or otherwise (including without limitation, any distribution of cash, shares or other securities, property or options by way of
a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (the “Distributions”),
then the Holder will be entitled to such Distributions as if the Holder had held the number of Ordinary Shares acquirable upon
complete conversion of this Note (without taking into account any limitations or restrictions on the convertibility of this Note
and assuming for such purpose that the Note was converted at the Alternate Conversion Price as of the applicable record date) immediately
prior to the date on which a record is taken for such Distribution or, if no such record is taken, the date as of which the record
holders of Ordinary Shares are to be determined for such Distributions (provided, however, that to the extent that the Holder’s
right to participate in any such Distribution would result in the Holder and the other Attribution Parties exceeding the Maximum
Percentage, then the Holder shall not be entitled to participate in such Distribution to the extent of the Maximum Percentage (and
shall not be entitled to beneficial ownership of such Ordinary Shares as a result of such Distribution (and beneficial ownership)
to the extent of any such excess) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder
until such time or times, if ever, as its right thereto would not result in the Holder and the other Attribution Parties exceeding
the Maximum Percentage, at which time or times the Holder shall be granted such Distribution (and any Distributions declared or
made on such initial Distribution or on any subsequent Distribution held similarly in abeyance) to the same extent as if there
had been no such limitation).

 

    	 	30	 

     

    

 

16.          AMENDING
THE TERMS OF THIS NOTE. Except for Section 3(d), which may not be amended, modified or waived by the parties hereto, the prior
written consent of the Holder shall be required for any change, waiver or amendment to this Note.

 

17.          TRANSFER.
This Note and any Ordinary Shares issued upon conversion of this Note may be offered, sold, assigned or transferred by the Holder
without the consent of the Company, subject only to the provisions of Section 2(g) of the Securities Purchase Agreement.

 

18.          REISSUANCE
OF THIS NOTE.

 

(a)          Transfer.
If this Note is to be transferred, the Holder shall surrender this Note to the Company, whereupon the Company will forthwith issue
and deliver upon the order of the Holder a new Note (in accordance with Section 18(d)), registered as the Holder may request, representing
the outstanding Principal being transferred by the Holder and, if less than the entire outstanding Principal is being transferred,
a new Note (in accordance with Section 18(d)) to the Holder representing the outstanding Principal not being transferred. The Holder
and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of Section 3(c)(iii) following
conversion or redemption of any portion of this Note, the outstanding Principal represented by this Note may be less than the Principal
stated on the face of this Note.

 

(b)          Lost,
Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Note (as to which a written certification and the indemnification contemplated below shall suffice
as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company
in customary and reasonable form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company shall
execute and deliver to the Holder a new Note (in accordance with Section 18(d)) representing the outstanding Principal.

 

(c)          Note
Exchangeable for Different Denominations. This Note is exchangeable, upon the surrender hereof by the Holder at the principal
office of the Company, for a new Note or Notes (in accordance with Section 18(d) and in principal amounts of at least $1,000) representing
in the aggregate the outstanding Principal of this Note, and each such new Note will represent such portion of such outstanding
Principal as is designated by the Holder at the time of such surrender.

 

    	 	31	 

     

    

 

(d)          Issuance
of New Notes. Whenever the Company is required to issue a new Note pursuant to the terms of this Note, such new Note (i) shall
be of like tenor with this Note, (ii) shall represent, as indicated on the face of such new Note, the Principal remaining outstanding
(or in the case of a new Note being issued pursuant to Section 18(a) or Section 18(c), the Principal designated by the Holder which,
when added to the principal represented by the other new Notes issued in connection with such issuance, does not exceed the Principal
remaining outstanding under this Note immediately prior to such issuance of new Notes), (iii) shall have an issuance date, as indicated
on the face of such new Note, which is the same as the Issuance Date of this Note, (iv) shall have the same rights and conditions
as this Note, and (v) shall represent accrued and unpaid Interest and Late Charges on the Principal and Interest of this Note,
from the Issuance Date.

 

19.          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. No failure
on the part of the Holder to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by the Holder of any right, power or remedy preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. In addition, the exercise of any right or remedy of the Holder at
law or equity or under this Note or any of the documents shall not be deemed to be an election of Holder’s rights or remedies
under such documents or at law or equity. 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 specific performance and/or temporary, preliminary and permanent injunctive
or other equitable relief from any court of competent jurisdiction in any such case without the necessity of proving actual damages
and without posting a bond or other security. 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
(including, without limitation, compliance with Section 7).

 

20.          PAYMENT
OF COLLECTION, ENFORCEMENT AND OTHER COSTS. If (a) this Note is placed in the hands of an attorney for collection or enforcement
or is collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this
Note or to enforce the provisions of this Note or (b) there occurs any bankruptcy, reorganization, receivership of the Company
or other proceedings affecting Company creditors’ rights and involving a claim under this Note, then the Company shall pay
the costs incurred by the Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization,
receivership or other proceeding, including, without limitation, attorneys’ fees and disbursements. The Company expressly
acknowledges and agrees that no amounts due under this Note shall be affected, or limited, by the fact that the purchase price
paid for this Note was less than the original Principal amount hereof.

 

    	 	32	 

     

    

 

21.          CONSTRUCTION;
HEADINGS. This Note shall be deemed to be jointly drafted by the Company and the initial Holder and shall not be construed
against any such Person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part
of, or affect the interpretation of, this Note. Unless the context clearly indicates otherwise, each pronoun herein shall be deemed
to include the masculine, feminine, neuter, singular and plural forms thereof. The terms “including,” “includes,”
“include” and words of like import shall be construed broadly as if followed by the words “without limitation.”
The terms “herein,” “hereunder,” “hereof” and words of like import refer to this entire Note
instead of just the provision in which they are found. Unless expressly indicated otherwise, all section references are to sections
of this Note. Terms used in this Note and not otherwise defined herein, but defined in the other Transaction Documents, shall have
the meanings ascribed to such terms on the Closing Date in such other Transaction Documents unless otherwise consented to in writing
by the Holder.

 

22.          FAILURE
OR INDULGENCE NOT WAIVER. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing and
signed by an authorized representative of the waiving party. Notwithstanding the foregoing, nothing contained in this Section 22
shall permit any waiver of any provision of Section 3(d).

 

23.          DISPUTE
RESOLUTION.

 

(a)           Submission
to Dispute Resolution.

 

(i)          In
the case of a dispute relating to a Closing Bid Price, a Closing Sale Price, a Conversion Price, an Installment Conversion Price,
an Alternate Conversion Price, a Black Scholes Consideration Value, a VWAP or a fair market value or the arithmetic calculation
of a Conversion Rate, or the applicable Redemption Price (as the case may be) (including, without limitation, a dispute relating
to the determination of any of the foregoing), the Company or the Holder (as the case may be) shall submit the dispute to the other
party via facsimile or electronic mail (A) if by the Company, within two (2) Business Days after the occurrence of the circumstances
giving rise to such dispute or (B) if by the Holder at any time after the Holder learned of the circumstances giving rise to such
dispute. If the Holder and the Company are unable to promptly resolve such dispute relating to such Closing Bid Price, such Closing
Sale Price, such Conversion Price, such Installment Conversion Price, such Alternate Conversion Price, such Black Scholes Consideration
Value, such VWAP or such fair market value, or the arithmetic calculation of such Conversion Rate or such applicable Redemption
Price (as the case may be), at any time after the second (2nd) Business Day following such initial notice by the Company
or the Holder (as the case may be) of such dispute to the Company or the Holder (as the case may be), then the Holder may, at its
sole option, select an independent, reputable investment bank to resolve such dispute.

 

    	 	33	 

     

    

 

(ii)         The
Holder and the Company shall each deliver to such investment bank (A) a copy of the initial dispute submission so delivered in
accordance with the first sentence of this Section 23 and (B) written documentation supporting its position with respect to such
dispute, in each case, no later than 5:00 p.m. (New York time) by the fifth (5th) Business Day immediately following
the date on which the Holder selected such investment bank (the “Dispute Submission Deadline”) (the documents
referred to in the immediately preceding clauses (A) and (B) are collectively referred to herein as the “Required Dispute
Documentation”) (it being understood and agreed that if either the Holder or the Company fails to so deliver all of the
Required Dispute Documentation by the Dispute Submission Deadline, then the party who fails to so submit all of the Required Dispute
Documentation shall no longer be entitled to (and hereby waives its right to) deliver or submit any written documentation or other
support to such investment bank with respect to such dispute and such investment bank shall resolve such dispute based solely on
the Required Dispute Documentation that was delivered to such investment bank prior to the Dispute Submission Deadline). Unless
otherwise agreed to in writing by both the Company and the Holder or otherwise requested by such investment bank, neither the Company
nor the Holder shall be entitled to deliver or submit any written documentation or other support to such investment bank in connection
with such dispute (other than the Required Dispute Documentation).

 

(iii)        The
Company and the Holder shall cause such investment bank to determine the resolution of such dispute and notify the Company and
the Holder of such resolution no later than ten (10) Business Days immediately following the Dispute Submission Deadline. The fees
and expenses of such investment bank shall be borne solely by the Company, and such investment bank’s resolution of such
dispute shall be final and binding upon all parties absent manifest error.

 

(b)          Miscellaneous.
The Company expressly acknowledges and agrees that (i) this Section 23 constitutes an agreement to arbitrate between the Company
and the Holder (and constitutes an arbitration agreement) under § 7501, et seq. of the New York Civil Practice Law and Rules
(“CPLR”) and that the Holder is authorized to apply for an order to compel arbitration pursuant to CPLR §
7503(a) in order to compel compliance with this Section 23, (ii) a dispute relating to a Conversion Price includes, without limitation,
disputes as to (A) whether an issuance or sale or deemed issuance or sale of Ordinary Shares occurred under Section 7(a), (B) the
consideration per share at which an issuance or deemed issuance of Ordinary Shares occurred, (C) whether any issuance or sale or
deemed issuance or sale of Ordinary Shares was an issuance or sale or deemed issuance or sale of Excluded Securities, (D) whether
an agreement, instrument, security or the like constitutes and Option or Convertible Security and (E) whether a Dilutive Issuance
occurred, (iii) the terms of this Note and each other applicable Transaction Document shall serve as the basis for the selected
investment bank’s resolution of the applicable dispute, such investment bank shall be entitled (and is hereby expressly authorized)
to make all findings, determinations and the like that such investment bank determines are required to be made by such investment
bank in connection with its resolution of such dispute and in resolving such dispute such investment bank shall apply such findings,
determinations and the like to the terms of this Note and any other applicable Transaction Documents, (iv) the Holder (and only
the Holder), in its sole discretion, shall have the right to submit any dispute described in this Section 23 to any state or federal
court sitting in The City of New York, Borough of Manhattan in lieu of utilizing the procedures set forth in this Section 23 and
(v) nothing in this Section 23 shall limit the Holder from obtaining any injunctive relief or other equitable remedies (including,
without limitation, with respect to any matters described in this Section 23).

 

    	 	34	 

     

    

 

24.          NOTICES;
CURRENCY; PAYMENTS.

 

(a)          Notices.
Whenever notice is required to be given under this Note, unless otherwise provided herein, such notice shall be given in accordance
with Section 9(f) of the Securities Purchase Agreement. The Company shall provide the Holder with prompt written notice of all
actions taken pursuant to this Note, including in reasonable detail a description of such action and the reason therefore. Without
limiting the generality of the foregoing, the Company will give written notice to the Holder (i) immediately upon any adjustment
of the Conversion Price, setting forth in reasonable detail, and certifying, the calculation of such adjustment and (ii) at least
fifteen (15) days prior to the date on which the Company closes its books or takes a record (A) with respect to any dividend or
distribution upon the Ordinary Shares, (B) with respect to any grant, issuances, or sales of any Options, Convertible Securities
or rights to purchase shares, warrants, securities or other property to holders of Ordinary Shares or (C) for determining rights
to vote with respect to any Fundamental Transaction, dissolution or liquidation, provided in each case that such information shall
be made known to the public prior to or in conjunction with such notice being provided to the Holder.

 

(b)          Currency.
All dollar amounts referred to in this Note are in United States Dollars (“U.S. Dollars”), and all amounts owing
under this Note shall be paid in U.S. Dollars. All amounts denominated in other currencies (if any) shall be converted into the
U.S. Dollar equivalent amount in accordance with the Exchange Rate on the date of calculation. “Exchange Rate”
means, in relation to any amount of currency to be converted into U.S. Dollars pursuant to this Note, the U.S. Dollar exchange
rate as published in the Wall Street Journal on the relevant date of calculation (it being understood and agreed that where an
amount is calculated with reference to, or over, a period of time, the date of calculation shall be the final date of such period
of time).

 

(c)          Payments.
Whenever any payment of cash is to be made by the Company to any Person pursuant to this Note, unless otherwise expressly set forth
herein, such payment shall be made in lawful money of the United States of America by a certified check drawn on the account of
the Company and sent via overnight courier service to such Person at such address as previously provided to the Company in writing
(which address, in the case of each of the Buyers, shall initially be as set forth on the Schedule of Buyers attached to the Securities
Purchase Agreement), provided that the Holder may elect to receive a payment of cash via wire transfer of immediately available
funds by providing the Company with prior written notice setting out such request and the Holder’s wire transfer instructions.
Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a Business Day, the same shall
instead be due on the next succeeding day which is a Business Day. Any amount of Principal or other amounts due under the Transaction
Documents which is not paid when due (except to the extent such amount is simultaneously accruing Interest at the Default Rate
hereunder) shall result in a late charge being incurred and payable by the Company in an amount equal to interest on such amount
at the rate of eighteen percent (18%) per annum from the date such amount was due until the same is paid in full (“Late
Charge”).

 

    	 	35	 

     

    

 

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

 

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

 

27.          GOVERNING
LAW. This Note shall be construed and enforced in accordance with, and all questions concerning the construction, validity,
interpretation and performance of this Note shall be governed by, the internal laws of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York. Except as otherwise required by Section
23 above, the Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City
of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed to limit
in any way any right to serve process in any manner permitted by law. Nothing contained herein (i) shall be deemed or operate to
preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on
the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce
a judgment or other court ruling in favor of the Holder or (ii) shall limit, or shall be deemed or construed to limit, any provision
of Section 23. The Company (on behalf of itself and each of its Subsidiaries) hereby appoints the agent for service of process
listed in Schedule 9(a) to the Securities Purchase Agreement, as its agent for service of process in New York. THE COMPANY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY. The choice of the laws of the State
of New York as the governing law of this Note is a valid choice of law and would be recognized and given effect to in any action
brought before a court of competent jurisdiction in the Cayman Islands and the laws of the People’s Republic of China except
for those laws (i) which such court considers to be procedural in nature, (ii) which are revenue or penal laws or (iii) the application
of which would be inconsistent with public policy, as such term is interpreted under the laws of the Cayman Islands and the laws
of the People’s Republic of China. The Company or any of their respective properties, assets or revenues does not have any
right of immunity under Cayman Islands, the laws of the People’s Republic of China or New York law, from any legal action,
suit or proceeding, from the giving of any relief in any such legal action, suit or proceeding, from set-off or counterclaim, from
the jurisdiction of any Cayman Islands, the People’s Republic of China, New York or United States federal court, from service
of process, attachment upon or prior to judgment, or attachment in aid of execution of judgment, or from execution of a judgment,
or other legal process or proceeding for the giving of any relief or for the enforcement of a judgment, in any such court, with
respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Note; and, to the
extent that the Company, or any of its properties, assets or revenues may have or may hereafter become entitled to any such right
of immunity in any such court in which proceedings may at any time be commenced, the Company hereby waives such right to the extent
permitted by law and hereby consents to such relief and enforcement as provided in this Note and the other Transaction Documents.

 

    	 	36	 

     

    

 

28.          JUDGMENT
CURRENCY.

 

(a)          If
for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary to
convert into any other currency (such other currency being hereinafter in this Section 28 referred to as the “Judgment
Currency”) an amount due in U.S. dollars under this Note, the conversion shall be made at the Exchange Rate prevailing
on the Trading Day immediately preceding:

 

(i)          the
date actual payment of the amount due, in the case of any proceeding in the courts of New York or in the courts of any other jurisdiction
that will give effect to such conversion being made on such date: or

 

(ii)         the
date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date as
of which such conversion is made pursuant to this Section 28(a)(ii) being hereinafter referred to as the “Judgment Conversion
Date”).

 

(b)          If
in the case of any proceeding in the court of any jurisdiction referred to in Section 28(a)(ii) above, there is a change in the
Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable
party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted
at the Exchange Rate prevailing on the date of payment, will produce the amount of US dollars which could have been purchased with
the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment Conversion
Date.

 

    	 	37	 

     

    

 

(c)          Any
amount due from the Company under this provision shall be due as a separate debt and shall not be affected by judgment being obtained
for any other amounts due under or in respect of this Note.

 

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

 

30.          MAXIMUM
PAYMENTS. Without limiting Section 9(d) of the Securities Purchase Agreement, nothing contained herein shall be deemed to establish
or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable law. In the event
that the rate of interest required to be paid or other charges hereunder exceed the maximum permitted by such law, any payments
in excess of such maximum shall be credited against amounts owed by the Company to the Holder and thus refunded to the Company.

 

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

 

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

 

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

 

(c)          
“Adjustment Right” means any right granted with respect to any securities issued in connection with, or with
respect to, any issuance or sale (or deemed issuance or sale in accordance with Section 7) of Ordinary Shares (other than rights
of the type described in Section 6(a) hereof) that could result in a decrease in the net consideration received by the Company
in connection with, or with respect to, such securities (including, without limitation, any cash settlement rights, cash adjustment
or other similar rights).

 

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

 

    	 	38	 

     

    

 

(e)          “Alternate
Conversion Price” means, with respect to any Alternate Conversion that price which shall be the lowest of (i) the applicable
Conversion Price as in effect on the applicable Conversion Date of the applicable Alternate Conversion, (ii) 80% of the VWAP of
the Ordinary Shares as of the Trading Day of the delivery or deemed delivery of the applicable Conversion Notice and (iii) 80%
of the price computed as the quotient of (I) the sum of the VWAP of the Ordinary Shares for each of the two (2) Trading Days with
the lowest VWAP of the Ordinary Shares during the eight (8) consecutive Trading Day period ending and including the Trading Day
immediately preceding the delivery or deemed delivery of the applicable Conversion Notice, divided by (II) two (2) (such period,
the “Alternate Conversion Measuring Period”). All such determinations to be appropriately adjusted for any share
dividend, share split, share combination, reclassification or similar transaction that proportionately decreases or increases the
Ordinary Shares during such Alternate Conversion Measuring Period.

 

(f)          
“Approved Share Plan” means any employee benefit plan which has been approved by the board of directors of the
Company prior to or subsequent to the Subscription Date pursuant to which Ordinary Shares and standard options to purchase Ordinary
Shares may be issued to any employee, officer or director for services provided to the Company in their capacity as such.

 

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

 

(h)          “Black
Scholes Consideration Value” means the value of the applicable Option, Convertible Security or Adjustment Right (as the
case may be) as of the date of issuance thereof calculated using the Black Scholes Option Pricing Model obtained from the “OV”
function on Bloomberg utilizing (i) an underlying price per share equal to the Closing Sale Price of the Ordinary Shares on the
Trading Day immediately preceding the public announcement of the execution of definitive documents with respect to the issuance
of such Option, Convertible Security or Adjustment Right (as the case may be), (ii) a risk-free interest rate corresponding to
the U.S. Treasury rate for a period equal to the remaining term of such Option, Convertible Security or Adjustment Right (as the
case may be) as of the date of issuance of such Option, Convertible Security or Adjustment Right (as the case may be), (iii) a
zero cost of borrow and (iv) an expected volatility equal to the greater of 100% and the 30 day volatility obtained from the “HVT”
function on Bloomberg (determined utilizing a 365 day annualization factor) as of the Trading Day immediately following the
date of issuance of such Option, Convertible Security or Adjustment Right (as the case may be).

 

    	 	39	 

     

    

 

(i)          “Bloomberg”
means Bloomberg, L.P.

 

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

 

(k)          “Change
of Control” means any Fundamental Transaction other than (i) any merger of the Company or any of its, direct or indirect,
wholly-owned Subsidiaries with or into any of the foregoing Persons, (ii) any reorganization, recapitalization or reclassification
of the Ordinary Shares in which holders of the Company’s voting power immediately prior to such reorganization, recapitalization
or reclassification continue after such reorganization, recapitalization or reclassification to hold publicly traded securities
and, directly or indirectly, are, in all material respects, the holders of the voting power of the surviving entity (or entities
with the authority or voting power to elect the members of the board of directors (or their equivalent if other than a corporation)
of such entity or entities) after such reorganization, recapitalization or reclassification, or (iii) pursuant to a migratory merger
effected solely for the purpose of changing the jurisdiction of incorporation of the Company or any of its Subsidiaries.

 

(l)          “Change
of Control Redemption Premium” means 110%.

 

(m)          “Closing
Bid Price” and “Closing Sale Price” means, for any security as of any date, the last closing bid price
and last closing trade price, respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal
Market begins to operate on an extended hours basis and does not designate the closing bid price or the closing trade price (as
the case may be) then the last bid price or last trade price, respectively, of such security prior to 4:00:00 p.m., New York time,
as reported by Bloomberg, or, if the Principal Market is not the principal securities exchange or trading market for such security,
the last closing bid price or last trade price, respectively, of such security on the principal securities exchange or trading
market where such security is listed or traded as reported by Bloomberg, or if the foregoing do not apply, the last closing bid
price or last trade price, respectively, of such security in the over-the-counter market on the electronic bulletin board for such
security as reported by Bloomberg, or, if no closing bid price or last trade price, respectively, is reported for such security
by Bloomberg, the average of the bid prices, or the ask prices, respectively, of any market makers for such security as reported
in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If the Closing Bid Price or the Closing
Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price or the
Closing Sale Price (as the case may be) of such security on such date shall be the fair market value as mutually determined by
the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved in accordance with the procedures in Section 23. All such determinations shall be appropriately
adjusted for any share splits, share dividends, share combinations, recapitalizations or other similar transactions during such
period.

 

    	 	40	 

     

    

 

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

 

(o)          “Ordinary
Shares” means (i) the Company’s ordinary shares, $0.001 par value per share, and (ii) any share capital into which
such ordinary shares shall have been changed or any share capital resulting from a reclassification of such ordinary shares.

 

(p)          “Convertible
Securities” means any shares or other security (other than Options) that is at any time and under any circumstances,
directly or indirectly, convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire,
any Ordinary Shares.

 

(q)          “Current
Subsidiary” means any Person in which the Company on the Subscription Date, directly or indirectly, (i) owns any of the
outstanding share capital or holds any equity or similar interest of such Person or (ii) controls or operates all or any part of
the business, operations or administration of such Person, and all of the foregoing, collectively, “Current Subsidiaries”.

 

(r)          “Default
Rate” means eighteen percent (18%) per annum

 

(s)          “Eligible
Market” means The New York Stock Exchange, the NYSE American, the Nasdaq Global Select Market, the Nasdaq Global Market
or the Principal Market.

 

    	 	41	 

     

    

 

(t)          “Equity
Conditions” means, with respect to an given date of determination: (i) on each day during the period beginning thirty
calendar days prior to such applicable date of determination and ending on and including such applicable date of determination
either (x) one or more Registration Statements filed pursuant to the Registration Rights Agreement shall be effective and the prospectus
contained therein shall be available on such applicable date of determination (with, for the avoidance of doubt, any Ordinary Shares
previously sold pursuant to such prospectus deemed unavailable) for the resale of all Ordinary Shares to be issued in connection
with the event requiring this determination (or issuable upon conversion of the Conversion Amount being redeemed, as applicable,
in the event requiring this determination at the Alternate Conversion Price then in effect (without regard to any limitations on
conversion set forth herein)) (each, a “Required Minimum Securities Amount”), in each case, in accordance with
the terms of the Registration Rights Agreement and there shall not have been during such period any Grace Periods (as defined in
the Registration Rights Agreement) or (y) all Registrable Securities shall be eligible for sale pursuant to Rule 144 (as defined
in the Securities Purchase Agreement) without the need for registration under any applicable federal or state securities laws (in
each case, disregarding any limitation on conversion of the Notes, other issuance of securities with respect to the Notes and exercise
of the Warrants) and no Current Information Failure (as defined in the Registration Rights Agreement) exists or is continuing;
(ii) on each day during the period beginning thirty calendar days prior to the applicable date of determination and ending on and
including the applicable date of determination (the “Equity Conditions Measuring Period”), the Ordinary Shares
(including all Registrable Securities) is listed or designated for quotation (as applicable) on an Eligible Market and shall not
have been suspended from trading on an Eligible Market (other than suspensions of not more than two (2) days and occurring prior
to the applicable date of determination due to business announcements by the Company) nor shall delisting or suspension by an Eligible
Market have been threatened (with a reasonable prospect of delisting occurring after giving effect to all applicable notice, appeal,
compliance and hearing periods) or reasonably likely to occur or pending as evidenced by (A) a writing by such Eligible Market
or (B) the Company falling below the minimum listing maintenance requirements of the Eligible Market on which the Ordinary Shares
is then listed or designated for quotation (as applicable); (iii) during the Equity Conditions Measuring Period, the Company shall
have delivered all Ordinary Shares issuable upon conversion of this Note on a timely basis as set forth in Section 3 hereof and
all other shares of share capital required to be delivered by the Company on a timely basis as set forth in the other Transaction
Documents; (iv) any Ordinary Shares to be issued in connection with the event requiring determination (or issuable upon conversion
of the Conversion Amount being redeemed in the event requiring this determination) may be issued in full without violating Section
3(d) hereof; (v) any Ordinary Shares to be issued in connection with the event requiring determination (or issuable upon conversion
of the Conversion Amount being redeemed in the event requiring this determination (without regards to any limitations on conversion
set forth herein)) may be issued in full without violating the rules or regulations of the Eligible Market on which the Ordinary
Shares is then listed or designated for quotation (as applicable); (vi) on each day during the Equity Conditions Measuring Period,
no public announcement of a pending, proposed or intended Fundamental Transaction shall have occurred which has not been abandoned,
terminated or consummated; (vii) the Company shall have no knowledge of any fact that would reasonably be expected to cause (1)
any Registration Statement required to be filed pursuant to the Registration Rights Agreement to not be effective or the prospectus
contained therein to not be available for the resale of the applicable Required Minimum Securities Amount of Registrable Securities
in accordance with the terms of the Registration Rights Agreement or (2) any Registrable Securities to not be eligible for sale
pursuant to Rule 144 without the need for registration under any applicable federal or state securities laws (in each case, disregarding
any limitation on conversion of the Notes, other issuance of securities with respect to the Notes and exercise of the Warrants)
and no Current Information Failure exists or is continuing; (viii) the Holder shall not be in (and no other holder of Notes shall
be in) possession of any material, non-public information provided to any of them by the Company, any of its Subsidiaries or any
of their respective affiliates, employees, officers, representatives, agents or the like; (ix) on each day during the Equity Conditions
Measuring Period, the Company otherwise shall have been in compliance with each, and shall not have breached any representation
or warranty in any material respect (other than representations or warranties subject to material adverse effect or materiality,
which may not be breached in any respect) or any covenant or other term or condition of any Transaction Document, including, without
limitation, the Company shall not have failed to timely make any payment pursuant to any Transaction Document; (x) on each Trading
Day during the Equity Conditions Measuring Period, there shall not have occurred any Volume Failure or Price Failure as of such
applicable date of determination; (xi) on the applicable date of determination (A) no Authorized Share Failure shall exist or be
continuing and the applicable Required Minimum Securities Amount of Ordinary Shares are available under the certificate of incorporation
of the Company and reserved by the Company to be issued pursuant to the Notes and (B) all Ordinary Shares to be issued in connection
with the event requiring this determination (or issuable upon conversion of the Conversion Amount being redeemed in the event requiring
this determination (without regards to any limitations on conversion set forth herein)) may be issued in full without resulting
in an Authorized Share Failure; (xii) on each day during the Equity Conditions Measuring Period, there shall not have occurred
and there shall not exist an Event of Default or an event that with the passage of time or giving of notice would constitute an
Event of Default; (xiii) no bone fide dispute shall exist, by and between any of holder of Notes or Warrants, the Company, the
Principal Market (or such applicable Eligible Market in which the Ordinary Shares of the Company is then principally trading) and/or
FINRA with respect to any term or provision of any Note or any other Transaction Document and (xiv) the Ordinary Shares issuable
pursuant the event requiring the satisfaction of the Equity Conditions are duly authorized and listed and eligible for trading
without restriction on an Eligible Market.

 

    	 	42	 

     

    

 

(u)          “Equity
Conditions Failure” means that on any day during the period commencing twenty (20) Trading Days prior to the applicable
Installment Notice Date through the later of the applicable Installment Date and the date on which the applicable Ordinary Shares
are actually delivered to the Holder, the Equity Conditions have not been satisfied (or waived in writing by the Holder).

 

(v)         “Event
Market Price” means, with respect to any Share Combination Event Date, the quotient determined by dividing (x) the sum
of the VWAP of the Ordinary Shares for each of the five (5) Trading Days with the lowest VWAP of the Ordinary Shares during the
fifteen (15) consecutive Trading Day period ending and including the Trading Day immediately preceding the sixteenth (16th) Trading
Day after such Share Combination Event Date, divided by (y) five (5).

 

(w)          “Excluded
Securities” means (i) Ordinary Shares or standard options to purchase Ordinary Shares issued to directors, officers or
employees of the Company for services rendered to the Company in their capacity as such pursuant to an Approved Share Plan (as
defined above), provided that (A) all such issuances (taking into account the Ordinary Shares issuable upon exercise of such options)
after the Subscription Date pursuant to this clause (i) do not, in the aggregate, exceed more than 5% of the Ordinary Shares issued
and outstanding immediately prior to the Subscription Date and (B) the exercise price of any such options is not lowered, none
of such options are amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such
options are otherwise materially changed in any manner that adversely affects any of the Buyers; (ii) Ordinary Shares issued upon
the conversion or exercise of Convertible Securities (other than standard options to purchase Ordinary Shares issued pursuant to
an Approved Share Plan that are covered by clause (i) above) issued prior to the Subscription Date, provided that the conversion
price of any such Convertible Securities (other than standard options to purchase Ordinary Shares issued pursuant to an Approved
Share Plan that are covered by clause (i) above) is not lowered, none of such Convertible Securities (other than standard options
to purchase Ordinary Shares issued pursuant to an Approved Share Plan that are covered by clause (i) above) are amended to increase
the number of shares issuable thereunder and none of the terms or conditions of any such Convertible Securities (other than standard
options to purchase Ordinary Shares issued pursuant to an Approved Share Plan that are covered by clause (i) above) are otherwise
materially changed in any manner that adversely affects any of the Buyers; (iii) the Ordinary Shares issuable upon conversion of
the Notes or otherwise pursuant to the terms of the Notes; provided, that the terms of the Notes are not amended, modified or changed
on or after the Subscription Date (other than antidilution adjustments pursuant to the terms thereof in effect as of the Subscription
Date), and (iv) the Ordinary Shares issuable upon exercise of the Warrants; provided, that the terms of the Warrants are not amended,
modified or changed on or after the Subscription Date (other than antidilution adjustments pursuant to the terms thereof in effect
as of the Subscription Date).

 

    	 	43	 

     

    

 

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

 

    	 	44	 

     

    

 

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

 

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

 

(aa)         “Indebtedness”
shall have the meaning ascribed to such term in the Securities Purchase Agreement.

 

(bb)         
“Installment Amount” means the sum of (A) (i) with respect to any Installment Date other than the Maturity Date,
the lesser of (x) $_____ and (y) the Principal amount then outstanding under this Note as of such Installment Date, and (ii) with
respect to the Installment Date that is the Maturity Date, the Principal amount then outstanding under this Note as of such Installment
Date (in each case, as any such Installment Amount may be reduced pursuant to the terms of this Note, whether upon conversion,
redemption or Deferral), (B) any Deferral Amount deferred pursuant to Section 8(d) and included in such Installment Amount in accordance
therewith, (C) any Acceleration Amount accelerated pursuant to Section 8(e) and included in such Installment Amount in accordance
therewith and (D) in each case of clauses (A) through (C) above, the sum of any accrued and unpaid Interest as of such Installment
Date under this Note, if any, the applicable Make-Whole Amount with respect to such Installment Amount, if any, and accrued and
unpaid Late Charges, if any, under this Note as of such Installment Date. In the event the Holder shall sell or otherwise transfer
any portion of this Note, the transferee shall be allocated a pro rata portion of the each unpaid Installment Amount hereunder.

 

    	 	45	 

     

    

 

(cc)         “Installment
Conversion Price” means, with respect to a particular date of determination, the lowest of (i) the Conversion Price then
in effect, (ii) 90% of the VWAP of the Ordinary Shares as of the Trading Day immediately preceding the applicable Installment Date
and (iii) 90% of the quotient of (A) the sum of the VWAP of the Ordinary Shares for each of the two (2) Trading Days with the lowest
VWAP of the Ordinary Shares during the eight (8) consecutive Trading Day period ending and including the Trading Day immediately
prior to the applicable Installment Date, divided by (B) two (2). All such determinations to be appropriately adjusted for any
share split, share dividend, share combination or other similar transaction during any such measuring period.

 

(dd)         “Installment
Date” means (i) the first Trading Day of each alternating calendar month commencing on February 1, 2019 (e.g., February,
April, June, August, October, December) until the Maturity Date, and (ii) the Maturity Date.

 

(ee)         “Interest
Date” means, with respect to any given calendar month, (x) if after the Maturity Date, the first Trading Day of such
calendar month or (y) if prior to the Maturity Date, each Installment Date, if any, in such calendar month.

 

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

 

(gg)         “Make-Whole
Amount” means, as of any given date, the amount of any Interest that, but for any conversion, Installment Conversion,
Acceleration or redemption hereunder on such given date, would have accrued with respect to the Conversion Amount or Installment
Amount being converted or redeemed under this Note at the Interest Rate for the period from such given date through the Maturity
Date.

 

(hh)         “Maturity
Date” shall mean April 1, 2020; provided, however, the Maturity Date may be extended at the option of the Holder (i)
in the event that, and for so long as, an Event of Default shall have occurred and be continuing or any event shall have occurred
and be continuing that with the passage of time and the failure to cure would result in an Event of Default or (ii) through the
date that is twenty (20) Business Days after the consummation of a Fundamental Transaction in the event that a Fundamental Transaction
is publicly announced or a Change of Control Notice is delivered prior to the Maturity Date, provided further that if a Holder
elects to convert some or all of this Note pursuant to Section 3 hereof, and the Conversion Amount would be limited pursuant to
Section 3(d) hereunder, the Maturity Date shall automatically be extended until such time as such provision shall not limit the
conversion of this Note.

 

(ii)         “New
Subsidiary” means, as of any date of determination, any Person in which the Company after the Subscription Date, directly
or indirectly, (i) owns or acquires any of the outstanding share capital or holds any equity or similar interest of such Person
or (ii) controls or operates all or any part of the business, operations or administration of such Person, and all of the foregoing,
collectively, “New Subsidiaries”.

 

(jj)         “Options”
means any rights, warrants or options to subscribe for or purchase Ordinary Shares or Convertible Securities.

 

    	 	46	 

     

    

 

(kk)         “Parent
Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person and whose common stock
or equivalent equity security is quoted or listed on an Eligible Market, or, if there is more than one such Person or Parent Entity,
the Person or Parent Entity with the largest public market capitalization as of the date of consummation of the Fundamental Transaction.

 

(ll)         “Permitted
Indebtedness” means (i) Indebtedness evidenced by this Note and the Other Notes, (ii) Indebtedness set forth on Schedule
3(s) to the Securities Purchase Agreement, as in effect as of the Subscription Date and (iii) Indebtedness secured by Permitted
Liens or unsecured but as described in clauses (iv) and (v) of the definition of Permitted Liens.

 

(mm)       “Permitted
Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings
for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising in the ordinary course
of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any Lien created by operation
of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in the ordinary course of business
with respect to a liability that is not yet due or delinquent or that are being contested in good faith by appropriate proceedings,
(iv) Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries to secure the purchase price
of such equipment or Indebtedness incurred solely for the purpose of financing the acquisition or lease of such equipment, or (B)
existing on such equipment at the time of its acquisition, provided that the Lien is confined solely to the property so acquired
and improvements thereon, and the proceeds of such equipment, in either case, with respect to Indebtedness in an aggregate amount
not to exceed $50,000, (v) Liens incurred in connection with the extension, renewal or refinancing of the Indebtedness secured
by Liens of the type described in clause (iv) above, provided that any extension, renewal or replacement Lien shall be limited
to the property encumbered by the existing Lien and the principal amount of the Indebtedness being extended, renewed or refinanced
does not increase, (vi) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of custom
duties in connection with the importation of goods, and (vii) Liens arising from judgments, decrees or attachments in circumstances
not constituting an Event of Default under Section 4(a)(xii)

 

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

 

(oo)        “Price
Failure” means, with respect to a particular date of determination, the VWAP of the Ordinary Shares on any Trading Day
during any Trading Day during the twenty (20) Trading Day period ending on the Trading Day immediately preceding such date of determination
fails to exceed $1.75 (as adjusted for share splits, share dividends, share combinations, recapitalizations or other similar transactions
occurring after the Subscription Date). All such determinations to be appropriately adjusted for any share splits, share dividends,
share combinations, recapitalizations or other similar transactions during any such measuring period.

 

    	 	47	 

     

    

 

(pp)        “Principal
Market” means the Nasdaq Capital Market.

 

(qq)        “Redemption
Notices” means, collectively, the Event of Default Redemption Notices, the Installment Notices with respect to any Installment
Redemption and the Change of Control Redemption Notices, and each of the foregoing, individually, a “Redemption Notice.”

 

(rr)          “Redemption
Premium” means 110%.

 

(ss)         “Redemption
Prices” means, collectively, Event of Default Redemption Prices, the Change of Control Redemption Prices and the Installment
Redemption Prices, and each of the foregoing, individually, a “Redemption Price.”

 

(tt)         “Registration
Rights Agreement” means that certain registration rights agreement, dated as of the Closing Date, by and among the Company
and the initial holders of the Notes relating to, among other things, the registration of the resale of the Ordinary Shares issuable
upon conversion of the Notes or otherwise pursuant to the terms of the Notes and exercise of the Warrants, as may be amended from
time to time.

 

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

 

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

 

(ww)       “Security
Agreement” shall have the meaning as set forth in the Securities Purchase Agreement.

 

(xx)         “Subscription
Date” means November 1, 2018.

 

(yy)        “Subsidiaries”
means, as of any date of determination, collectively, all Current Subsidiaries and all New Subsidiaries, and each of the foregoing,
individually, a “Subsidiary.”

 

(zz)         “Subject
Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.

 

(aaa)      
“Successor Entity” means the Person (or, if so elected by the Holder, the Parent Entity) formed by, resulting
from or surviving any Fundamental Transaction or the Person (or, if so elected by the Holder, the Parent Entity) with which such
Fundamental Transaction shall have been entered into.

 

    	 	48	 

     

    

 

(bbb)     “Trading
Day” means, as applicable, (x) with respect to all price or trading volume determinations relating to the Ordinary Shares,
any day on which the Ordinary Shares is traded on the Principal Market, or, if the Principal Market is not the principal trading
market for the Ordinary Shares, then on the principal securities exchange or securities market on which the Ordinary Shares is
then traded, provided that “Trading Day” shall not include any day on which the Ordinary Shares is scheduled to trade
on such exchange or market for less than 4.5 hours or any day that the Ordinary Shares is suspended from trading during the final
hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time of trading
on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time) unless such day is otherwise designated
as a Trading Day in writing by the Holder or (y) with respect to all determinations other than price determinations relating to
the Ordinary Shares, any day on which The New York Stock Exchange (or any successor thereto) is open for trading of securities.

 

(ccc)      “Volume
Failure” means, with respect to a particular date of determination, the aggregate daily dollar trading volume (as reported
on Bloomberg) of the Ordinary Shares on the Principal Market on any Trading Days during the twenty (20) Trading Day period ending
on the Trading Day immediately preceding such date of determination (such period, the “Volume Failure Measuring Period”),
is less than $300,000 (as adjusted for any share splits, share dividends, share combinations, recapitalizations or other similar
transactions occurring after the Subscription Date). All such determinations to be appropriately adjusted for any share splits,
share dividends, share combinations, recapitalizations or other similar transactions during such Volume Failure Measuring Period.

 

(ddd)    
“VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on
the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the principal
securities exchange or securities market on which such security is then traded) during the period beginning at 9:30:01 a.m., New
York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg through its “HP” function (set to weighted
average) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter
market on the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time, and ending
at 4:00:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security
by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market
makers for such security as reported in the “pink sheets” by OTC Markets Group Inc. (formerly Pink Sheets LLC). If
the VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP of such security on such date
shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to
agree upon the fair market value of such security, then such dispute shall be resolved in accordance with the procedures in Section
23. All such determinations shall be appropriately adjusted for any share dividend, share split, share combination, recapitalization
or other similar transaction during such period.

 

    	 	49	 

     

    

 

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

 

32.          DISCLOSURE.
Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless the Company has in good
faith determined that the matters relating to such notice do not constitute material, non-public information relating to the Company
or any of its Subsidiaries, the Company shall within one (1) Business Day of such receipt or prior to (or simultaneous with) such
delivery, as applicable, publicly disclose such material, non-public information on a Report of Foreign Private Issuer on Form
6-K or otherwise. In the event that the Company believes that a notice contains material, non-public information relating to the
Company or any of its Subsidiaries, the Company so shall indicate to the Holder contemporaneously with delivery of such notice,
and in the absence of any such indication, the Holder shall be allowed to presume that all matters relating to such notice do not
constitute material, non-public information relating to the Company or any of its Subsidiaries. If the Company or any of its Subsidiaries
provides material non-public information to the Holder that is not simultaneously filed in a Report of Foreign Private Issuer on
Form 6-K and the Holder has not agreed to receive such material non-public information, the Company hereby covenants and agrees
that the Holder shall not have any duty of confidentiality to the Company, any of its Subsidiaries or any of their respective officers,
directors, employees, affiliates or agents with respect to, or a duty to any of the foregoing not to trade on the basis of, such
material non-public information. Nothing contained in this Section 32 shall limit any obligations of the Company, or any rights
of the Holder, under Section 4(i) of the Securities Purchase Agreement.

 

[signature page follows]

 

    	 	50	 

     

    

 

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

 

	 	FARMMI, INC.
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

Senior Convertible Note - Signature Page

 

     

     

    

 

EXHIBIT
I

 

FARMMI, INC.

CONVERSION NOTICE

 

Reference is made to
the Senior Secured Convertible Note (the “Note”) issued to the undersigned by Farmmi, Inc., a company organized
under the laws of the Cayman Islands (the “Company”). In accordance with and pursuant to the Note, the undersigned
hereby elects to convert the Conversion Amount (as defined in the Note) of the Note indicated below into Ordinary Shares, $0.001
par value per share (the “Ordinary Shares”), of the Company, as of the date specified below. Capitalized terms
not defined herein shall have the meaning as set forth in the Note.

 

	Date of Conversion:	 

 

	Aggregate Principal to be converted:	 
	 	 
	Aggregate accrued and unpaid Interest and accrued and unpaid Late Charges with respect to such portion of the Aggregate Principal and such Aggregate Interest to be converted:	 
	 	 
	AGGREGATE CONVERSION AMOUNT

 TO BE CONVERTED:	 

 

	Please confirm the following information:
	 
	Conversion Price:	 

 

	Number of Ordinary Shares to be issued:	 

 

	Installment Amount(s) to be reduced (and corresponding Installment Date(s)) and amount of reduction:	 

 

		 ̈	If this Conversion Notice is being delivered with respect
to an Alternate Conversion, check here if Holder is electing to use the following Alternate Conversion Price:____________

 

		 ̈	If this Conversion Notice is being delivered with respect to an Acceleration, check here if Holder
is electing to use _________ as the Installment Conversion Price (as applicable) related to the following Installment Date:____________

 

     

     

    

 

Please issue the Ordinary Shares into which
the Note is being converted to Holder, or for its benefit, as follows:

 

		 ̈	Check here if requesting delivery as a certificate to the following name and to the following address:

 

	 
	Issue to:	 
	 	 
	 	 
	 	 
	 	 

 

		 ̈	Check here if requesting delivery by Deposit/Withdrawal at Custodian as follows:

 

	DTC Participant:	 

 

	DTC Number:	 

 

	Account Number:	 

 

Date: _____________ __,

 

	 	 
	Name of Registered Holder	 
	 	 
	By:	 	 
	 	Name:	 
	 	Title:	 
	 	 
	 	Tax ID:_____________________	 
	 	 	 
	 	Facsimile:___________________	 
	 	 	 
	E-mail Address:	 

 

     

     

    

 

Exhibit II

 

ACKNOWLEDGMENT

 

The Company hereby
(a) acknowledges this Conversion Notice, (b) certifies that the above indicated number of Ordinary Shares [are][are not] eligible
to be resold by the Holder either (i) pursuant to Rule 144 (subject to the Holder’s execution and delivery to the Company
of a customary 144 representation letter) or (ii) an effective and available registration statement and (c) hereby directs _________________
to issue the above indicated number of Ordinary Shares in accordance with the Transfer Agent Instructions dated _____________,
20__ from the Company and acknowledged and agreed to by ________________________.

 

	 	FARMMI, INC.
	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

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