Document:

Exhibit

	
		
	RECORDING REQUESTED BY AND 
WHEN RECORDED MAIL TO:
	SPACE ABOVE LINE RESERVED FOR
OFFICIAL RECORDER'S USE

	PROSKAUER ROSE LLP

	2049 CENTURY PARK EAST, SUITE 3200

	LOS ANGELES, CALIFORNIA 90067

	ATTENTION: D. ERIC REMENSPERGER, ESQ.

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FIXTURE FILING

By

AL REAL ESTATE HOLDINGS, LLC,
as Mortgagor

to and for the benefit of

TCW ASSET MANAGEMENT COMPANY,
as Agent

Property Address:

1050 East Washington Street, Indianapolis, Indiana
1122 East Washington Street, Indianapolis, Indiana

 

MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT
AND FIXTURE FILING

THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this “Mortgage” is executed as of June 10, 2016, by AL Real Estate Holdings, LLC, an Indiana limited liability company, wholly-owned by Angie’s List, Inc., a Delaware corporation (“Mortgagor”), whose address for notice hereunder is 1030 East Washington Street, Indianapolis, Indiana  46202, to and in favor of TCW Asset Management Company, a California corporation, in its capacity as collateral agent for the benefit of the below-defined Lenders (in such capacity, “Agent”), whose address for notice hereunder is 865 South Figueroa Street, Suite 1800, Los Angeles, CA  90017.

ARTICLE 1.

DEFINITIONS

Section 1.1.  Definitions.

		
	(a)
	As used herein, the following terms shall have the following meanings:

“Applicable Law” shall have the meaning set forth in Section 8.2(a).

“Borrowers” shall have the meaning set forth in the Credit Agreement.

“Collateral” means: (a) each parcel of real property described in Exhibit A, together with any greater estate therein as hereafter may be acquired by Mortgagor (collectively, the “Land”); (b) all buildings, structures and other improvements, now or at any time situated, placed or constructed upon the Land (collectively, the “Improvements”); (c) all materials, supplies, equipment, apparatus and other items of personal property now owned or hereafter acquired by Mortgagor and now or hereafter attached to, installed in or used in connection with any of the Improvements or the Land, and water, gas, electrical, storm and sanitary sewer facilities and all other utilities whether or not situated in easements, now owned or hereafter acquired by Mortgagor (collectively, the “Fixtures”); (d) all leases, subleases, licenses, concessions, occupancy agreements or other agreements (written or oral, now or at any time in effect), if any, which grant a possessory interest in, or right to use or occupy, all or any part of the Property (collectively, the “Leases”); (e) all guaranties and other surety arrangements (written or oral, now or at any time in effect) of, for or otherwise relating to any of the Leases (collectively, the “Lease Guaranties”), together with any security and other deposits now or hereafter given to secure, or otherwise relating to, the Leases or the Lease Guaranties; (f) all minimum, percentage and other rentals paid or payable by any tenant, licensee, concessionaire, occupant or other user of all or any portion of the Property, whether pursuant to a Lease or otherwise (collectively, “Tenants”), all amounts paid or payable by Tenants pursuant to escalation or other adjustment provisions in their respective Leases or on account of maintenance or service charges, taxes, assessments, insurance, utilities, air conditioning and heating, and other administrative, management, operating and leasing expenses for the Property, all awards hereafter made to Mortgagor in any bankruptcy, insolvency or reorganization case or proceeding with respect to any Leases or the Lease Guaranties, and all royalties, issues, profits, revenues, income, and other money and benefits paid or payable by Tenants or arising in connection with any Lease or Lease Guaranty (collectively, the “Rents”); (g) all of Mortgagor’s interest in any other agreements (written or oral, now or at any time in effect), including construction contracts, architects’ agreements, engineers’ contracts, utility contracts, maintenance agreements, management agreements, service contracts, and leases, licenses, and occupancy agreements in favor of Mortgagor related to the Property, and, to the extent assignable, all permits, licenses, approvals, certificates and entitlements in any way relating to the development, construction, use, occupancy, operation, maintenance, enjoyment, acquisition or ownership of the Property (collectively, the “Property Agreements”); (h) Mortgagor’s interest in all rights, privileges, tenements, hereditaments, rights-of-way, easements, appendages and appurtenances appertaining to the foregoing, and all right, title and interest, if any, of Mortgagor in and to any streets, ways, alleys, strips or gores of land adjoining the Land or any part thereof, now existing or hereafter arising; (i) all accessions, replacements and substitutions for any of the foregoing and all proceeds thereof; (j) all insurance policies, unearned premiums therefor and proceeds from such policies insuring the 

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Property now or hereafter acquired by Mortgagor, subject to the terms and conditions of the Credit Agreement; (k) all mineral, water, oil and gas rights now owned by Mortgagor or hereafter acquired by Mortgagor and relating to all or any part of the Property; and (l) all of Mortgagor’s right, title and interest in and to any awards, remunerations, reimbursements, settlements or compensation heretofore made or hereafter to be made by any Governmental Authority (as defined in the Credit Agreement) pertaining to the Property, subject to the terms and conditions of the Credit Agreement.  As used in this Mortgage, the term “Collateral” shall mean all or, where the context permits or requires, any portion of the above or any interest therein. 

“Credit Agreement” means that certain Financing Agreement dated as of September 26, 2014, as amended by that certain Limited Waiver to Financing Agreement entered into as of February 16, 2015, among Angie’s List, Inc., a Delaware corporation, each of its Subsidiaries that executes a joinder agreement as a Borrower, and each domestic Subsidiary of Angie’s List, Inc. listed on the signature pages thereto as a “Guarantor” to such Credit Agreement, TCW Asset Management Company, as both Administrative Agent and Collateral Agent (each as defined therein), and the Lenders parties thereto, as the same may be amended, modified or otherwise in effect from time to time.

“Event of Default” means (a) the failure of this Mortgage to constitute a first priority lien on the Property subject only to Permitted Liens, or (b) any “Event of Default” as defined in the Credit Agreement.

“Guaranty” shall have the meaning set forth in the Credit Agreement.

“Lenders” shall have the meaning set forth in the Credit Agreement.

“Loan” means the term loans, letters of credit and other financial accommodations in the aggregate principal amount of up to Eighty-Five Million and 00/100 Dollars ($85,000,000.00) to be made by the Lenders to the Borrowers pursuant to, and as evidenced by, the Credit Agreement.

“Loan Documents” shall have the meaning set forth in the Credit Agreement. 

“Obligations” shall have the meaning set forth in the Credit Agreement. 

“Permitted Liens” shall have the meaning set forth in the Credit Agreement.

“Property” means the Land, the Improvements, and the Fixtures.

“Security Agreement” shall mean the "Security Agreement" (as defined in the Credit Agreement) to which Mortgagor is a party.

“State” shall have the meaning set forth in Section 8.2(a) hereof.

“Subsidiaries” shall have the meaning set forth in the Credit Agreement.

“UCC” means the Uniform Commercial Code of the State of New York or, if the creation, perfection and enforcement of any security interest herein granted is governed by the laws of a state other than the State of New York then, as to the matter in question, the Uniform Commercial Code in effect in that state.

		
	(b)
	Capitalized terms not otherwise defined in this Mortgage shall have the meanings ascribed to such terms in the Credit Agreement.

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Section 1.2.  General Construction. Unless otherwise noted, all “Article” and “Section” references shall be to Articles or Sections of this Mortgage.  All uses of the word “including” shall mean “including, without limitation” unless the context shall indicate otherwise.  Unless otherwise specified, the words “hereof,” “herein” and “hereunder” and words of similar import when used in this Mortgage shall refer to this Mortgage as a whole and not to any particular provision of this Mortgage.  Unless otherwise specified, all meanings attributed to defined terms herein shall be equally applicable to both the singular and plural forms of the terms so defined.  All references to the Loan Documents shall mean such document as it is constituted as of the date hereof, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

ARTICLE 2.

GRANT

Section 2.1.  Grant. To secure the full and timely payment of the Obligations and Borrowers’ performance under the Loan Documents, Mortgagor MORTGAGES, CONVEYS and WARRANTS to Agent, and grants Agent to and for the benefit of the Lenders a security interest in, the Collateral, TO HAVE AND TO HOLD, WITH POWER OF SALE, and Mortgagor does hereby bind itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to the Collateral unto Agent for the benefit of Agent and the Lenders, subject to the Permitted Liens.  Further, Mortgagor unconditionally and absolutely assigns all Leases, Lease Guaranties and Rents to Agent to and for the benefit of the Lenders, subject to the license set forth in Section 5.2 hereof.

ARTICLE 3.

WARRANTIES, REPRESENTATIONS AND COVENANTS

Section 3.1.  Title to Collateral and Lien of this Instrument. Mortgagor owns the Property free and clear of any liens, claims or interests, except the Permitted Liens.  This Mortgage creates valid, enforceable first priority liens and security interests against the Property.

Section 3.2.  First Lien Status. Mortgagor shall preserve and protect the first priority lien and security interest status of this Mortgage.  If any lien or security interest other than the Permitted Liens is asserted against the Property, Mortgagor shall promptly, and at its expense, give Agent a detailed written notice of such lien or security interest (including origin, amount and such other information as Agent may reasonably request), and shall either (a) pay or otherwise satisfy the underlying claim in full or take such other action so as to cause it to be released, or (b) contest the same in compliance with the requirements of the Credit Agreement.

Section 3.3.  Payment and Performance. Mortgagor shall pay the Obligations in full when they are required to be paid and perform all acts required to be performed in accordance with the Loan Documents.

Section 3.4.  Replacement of Fixtures. Subject to Section 3.9(b), Mortgagor shall not, without the prior written consent of Agent (which may be granted or withheld in Agent’s reasonable discretion), permit any of the Fixtures to be removed at any time from the Land or Improvements unless (a) the removed item is removed in the ordinary course of Mortgagor’s business and does not result in a Material Adverse Effect, (b) the removed item is removed temporarily for maintenance or repair or, if removed permanently, is obsolete or is replaced by an article of equal or better suitability and value owned by Mortgagor or (c) such removal is otherwise permitted under the Credit Agreement.

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Section 3.5.  Maintenance of Rights of Way, Easements and Licenses. Mortgagor shall maintain or cause to be maintained all rights of way, easements, grants, privileges, licenses, certificates, permits, entitlements, and franchises necessary for the use of the Collateral and will not, without the prior consent of Agent (which may be granted or withheld in Agent’s reasonable discretion), consent to any public restriction (including any zoning ordinance) or private restriction materially affecting Mortgagor’s current use of the Collateral.  Mortgagor shall comply in all material respects with all restrictive covenants affecting the Collateral, and all applicable legal requirements, laws, rules, regulations, and orders of any Governmental Authority, including zoning ordinances, environmental laws and other public or private restrictions as to the use of the Collateral.

Section 3.6.  Inspection. Mortgagor shall permit Agent, and its agents, representatives and employees to inspect the Collateral and conduct such environmental and engineering studies as Agent may reasonably require, in accordance with Section 7.01(f) of the Credit Agreement.

Section 3.7.  Insurance. Mortgagor agrees, at Mortgagor’s sole cost and expense, to keep the Property insured at all times throughout the term of the Credit Agreement with policies of insurance as required by Section 7.01(h) of the Credit Agreement.

Section 3.8.  Condemnation Awards and Insurance Proceeds. 
   
		
	(a)
	Condemnation Awards. Subject to Mortgagor's rights to use awards and compensation for any condemnation or other taking or any purchase in lieu thereof in accordance with the terms and conditions of the Credit Agreement, Mortgagor assigns to Agent all such awards and compensation for any condemnation or other taking and Mortgagor authorizes Agent to collect and receive such awards and compensation and to give proper receipts and acquittances therefor, subject to the terms and conditions of the Credit Agreement.

		
	(b)
	Insurance Proceeds. Subject to Mortgagor’s rights to use all proceeds of any insurance policies insuring against loss or damage to the Collateral in accordance with the terms of the Credit Agreement, Mortgagor assigns to Agent all proceeds of any insurance policies insuring against loss or damage to the Collateral.  Subject to the terms and conditions of the Credit Agreement, Mortgagor authorizes Agent to collect and receive such proceeds, to give proper receipts and acquittances therefor, and authorizes and directs the issuer of each of such insurance policies to make payment for all such losses directly to Agent, instead of to Mortgagor and Agent jointly.

Section 3.9.  Maintenance of Property.

		
	(a)
	Mortgagor shall maintain, preserve, protect and keep the Property in good repair, working order and condition, in accordance with Section 7.01(g) of the Credit Agreement.

		
	(b)
	Notwithstanding anything to the contrary herein contained, subject to compliance in all respects with any applicable requirements set forth in the Credit Agreement, Mortgagor shall be entitled to remove and replace the Improvements and Fixtures located on the Land provided (i) that Mortgagee shall provide Mortgagor with copies of the final plans and specifications for any new improvements, (ii) all work shall be done in a good an workman like manner and pursuant to such permits as may be required under applicable law, and (iii) Mortgagee shall be required to pay all contractors, subcontractors and suppliers and not allow any liens to be filed against the Property other than as permitted by the terms of the Credit Agreement.  

		
	(c)
	Without limiting the generality of the foregoing, if and so long as operations shall be taking place in the Improvements on the Property, Mortgagor shall be required to keep the same and good repair, working order and condition, in accordance with Section 7.01(g) of the Credit Agreement.

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Section 3.10.  Governmental Charges. Mortgagor shall pay before the same become delinquent all ad valorem real estate and personal property taxes, charges, sewer use fees, water rates and assessments of every name and nature, whether or not assessed against Mortgagor, if applicable, or related to the Property, or any interest therein, which, if unpaid, might by law become a lien or charge upon all or any part of the Property; provided, however, that so long as no distraint, foreclosure sale or other levy upon or transfer with respect to the Property or any part thereof shall have been effected or threatened, Mortgagor shall not be required to pay any such taxes, charges, fees, rates and assessments by reason of this Section 3.10 if such amount is subject to contest subject to Mortgagor’s compliance with the applicable provisions of the Credit Agreement.

Section 3.11.  Encumbrances. Mortgagor shall not create or permit to be created or permit to exist any encumbrance or Lien on the Property (other than any Lien for ad valorem real estate taxes not yet due and payable, the Permitted Liens and as otherwise permitted under the Credit Agreement) even if such encumbrance is inferior to this Mortgage, without the prior express written consent of Agent.

Section 3.12.  Transfers of Ownership. Except for easements, leases, licenses and similar transfers of interests in the Property, or any part thereof, completed in Mortgagor’s ordinary course of business or as expressly permitted by the Credit Agreement and Section 3.13 hereof, Mortgagor shall not sell or permit any transfer of any interest in the Property, or any part thereof, without the prior express written consent of Agent.

Section 3.13.  Release of Property. Notwithstanding the provisions of Section 3.12 or any provision in the Credit Agreement to the contrary, Mortgagor may sell or otherwise dispose of one or more of the Properties in accordance with Section 7.02 of the Credit Agreement and Agent shall release the liens and security interests created by this Mortgage in connection with any such sale or sales.

ARTICLE 4.

DEFAULT AND FORECLOSURE

Section 4.1.  Remedies. If an Event of Default exists and remains unremedied as provided for in the Credit Agreement, Agent may, at Agent’s election, exercise any or all of the following rights, remedies and recourses:

		
	(a)
	Acceleration. Declare the Obligations to be immediately due and payable, without further notice, presentment, protest, notice of intent to accelerate, notice of acceleration, demand or action of any nature whatsoever (each of which hereby is expressly waived by Mortgagor), whereupon the same shall become immediately due and payable and, immediately upon the occurrence and during the continuance of an Event of Default, interest shall accrue on the outstanding principal balance of the Obligations at the default rate of interest provided for under the Credit Agreement.

		
	(b)
	Entry on Collateral. To the extent permitted by applicable law, enter the Property and take exclusive possession of the Collateral and of all books, records and accounts relating thereto.  If Mortgagor remains in possession of the Collateral during the existence of an Event of Default and without Agent’s written consent (to be issued or withheld in Agent’s sole and absolute discretion), Agent may invoke any applicable legal remedies to dispossess Mortgagor.

		
	(c)
	Operation of Collateral. To the extent permitted by applicable law and subject to Section 3.9(b), hold, lease, develop, manage, operate or otherwise use the Collateral upon such terms and conditions as Agent may deem reasonable under the circumstances (including making such repairs, alterations, additions and improvements and taking other actions, from time to time, as Agent reasonably deems necessary or desirable to preserve the value of the Collateral), and apply all Rents and other amounts collected by Agent in connection therewith in accordance with the provisions of Section 4.7.

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	(d)
	Foreclosure and Sale. Subject to Section 8.3 and to the greatest extent permitted by applicable law, sell or offer for sale the Collateral in such portions, order and parcels as Agent may determine, with or without having first taken possession of same, to the highest bidder for cash at public auction.  Such sale shall be made in accordance with the laws of the State in which the Property is located relating to the sale of real estate or by Article 9 of the UCC relating to the sale of collateral after default by a debtor (as such laws now exist or may be hereafter amended or succeeded), or by any other present or subsequent articles or enactments relating to same. With respect to any notices required or permitted under the UCC, Mortgagor agrees that ten (10) days’ prior written notice shall be deemed commercially reasonable.  At any such sale (i) whether made under the UCC, any other legal requirement or by virtue of any judicial foreclosure proceedings or any other legal right, remedy or recourse, it shall not be necessary for Agent to be physically present at or to have constructive possession of the Collateral (Mortgagor shall deliver to Agent any portion of the Collateral not actually or constructively possessed by Agent immediately upon demand by Agent), and the title to and right of possession of any such property shall pass to the purchaser thereof as completely as if Agent had been actually present and delivered to purchaser at such sale, (ii) each instrument of conveyance executed by Agent shall contain a special warranty of title binding upon Mortgagor, subject to the Permitted Liens, (iii) each recital contained in any instrument of conveyance made by Agent shall conclusively establish the truth and accuracy of the matters recited therein, including nonpayment of the Obligations, advertisement and conduct of such sale in the manner provided herein and otherwise by applicable law, (iv) any prerequisites to the validity of such sale shall be conclusively presumed to have been performed, (v) the receipt of Agent or other party making the sale shall be a sufficient discharge to the purchaser or purchasers for its or their purchase money and no such purchaser or purchasers, or its or their assigns or personal representatives, shall thereafter be obligated to see to the application of such purchase money or be in any way answerable for any loss, misapplication or nonapplication thereof, and (vi) to the fullest extent permitted by applicable law, Mortgagor shall be completely and irrevocably divested of all of its right, title, interest, claim, equity, equity of redemption, and demand whatsoever, either at law or in equity, in and to the property sold and such sale shall be a perpetual bar both at law and in equity against Mortgagor, and against all other persons claiming or to claim the property sold or any part thereof, by, through or under Mortgagor.  Agent or any Lender may be a purchaser at such sale and if Agent or such Lender is the highest bidder, may credit the portion of the purchase price that would be distributed to Agent against the Obligations in lieu of paying cash. 

		
	(e)
	Receiver. Make application to a court of competent jurisdiction for, and obtain from such court as a matter of strict right and, to the extent permitted by applicable law, without notice to Mortgagor or regard to the adequacy of the Collateral for the repayment of the Obligations, the appointment of a receiver of the Collateral, and Mortgagor irrevocably consents to such appointment.  Any such receiver shall serve without posting a bond and shall have all the usual powers and duties of receivers in similar cases pursuant to applicable law, including the full power to rent, maintain and otherwise operate the Collateral upon such terms as may be approved by the court, and shall apply such Rents in accordance with the provisions of Section 4.7.

		
	(f)
	Other. Exercise all other rights, remedies and recourses granted under the Loan Documents or otherwise available at law or in equity (including an action for specific performance of any covenant contained in the Loan Documents during any proceeding to enforce this Mortgage). 

Section 4.2.  Separate Sales. The Collateral may be sold in one or more parcels and in such manner and order as Agent, in its sole and absolute discretion, may elect; and the right of sale arising out of any Event of Default shall not be exhausted by any one or more sales.

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Section 4.3.  Remedies Cumulative, Concurrent and Nonexclusive. Agent and the Lenders shall have all rights, remedies and recourses granted hereunder and in the Loan Documents and available at law or equity (including the UCC), which rights (a) shall be cumulative and concurrent, (b) may be pursued separately, successively or concurrently against Mortgagor or others obligated under the Credit Agreement and the other Loan Documents, or against the Collateral, or against any one or more of them, at the sole discretion of Agent, (c) may be exercised as often as occasion therefor shall arise, and the exercise or failure to exercise any of them shall not be construed as a waiver or release thereof or of any other right, remedy or recourse, and (d) are intended to be, and shall be, nonexclusive.  No action by Agent in the enforcement of any rights, remedies or recourses hereunder, under the Loan Documents or otherwise at law or equity shall be deemed to cure any Event of Default.  To the extent permitted by applicable law, Mortgagor hereby waives and releases all procedural errors, defects and imperfections in any proceedings instituted by Agent under the terms of this Mortgage and the other Loan Documents.

Section 4.4.  Release of and Resort to Collateral. Agent may release, regardless of consideration and without the necessity for any notice to or consent by the holder of any subordinate lien on the Collateral, any part of the Collateral without, as to the remainder, in any way impairing, affecting, subordinating or releasing the lien or security interests created in or evidenced by the Loan Documents or their stature as a first and prior lien and security interest in and to the Collateral.  To the extent permitted by law, for payment of the Obligations, Agent may resort to any other security in such order and manner as Agent may elect.

Section 4.5.  Waiver of Redemption, Notice and Marshalling of Assets. To the fullest extent permitted by applicable law, Mortgagor hereby irrevocably and unconditionally waives and releases (a) all benefit that might accrue to Mortgagor by virtue of any present or future statute of limitations or law or judicial decision exempting the Collateral from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment, (b) all notices of any Event of Default or of Agent’s election to exercise or its actual exercise of any right, remedy or recourse provided for under the Loan Documents or at law or in equity, and (c) any right to a marshalling of assets or a sale in inverse order of alienation.

Section 4.6.  Discontinuance of Proceedings. If Agent shall have proceeded to invoke any right, remedy or recourse permitted under the Loan Documents and shall thereafter elect to discontinue or abandon it for any reason, Agent shall have the unqualified right to do so and, in such an event, Mortgagor and Agent shall be restored to their former positions with respect to the Obligations, the Loan Documents, the Collateral and otherwise, and the rights, remedies, recourses and powers of Agent shall continue as if the right, remedy or recourse had never been invoked, but no such discontinuance or abandonment shall waive any Event of Default which may then exist or the right of Agent thereafter to exercise any right, remedy or recourse under the Loan Documents for such Event of Default.

Section 4.7.  Application of Proceeds. The proceeds of any sale of, and the Rents and other amounts generated by the holding, operating, insuring, leasing, management, operation or other use of the Collateral, after the exercise by Agent of any remedy hereunder giving Agent control or possession of such sum, shall be applied by Agent (or the receiver, if one is appointed) in the order set forth in the Credit Agreement unless otherwise required by applicable law.

Section 4.8.  Occupancy After Foreclosure. The purchaser at any sale pursuant to Section 4.1(d) shall become the legal owner of the Collateral.  All occupants of the Collateral shall, to the extent permitted by law and at the option of such purchaser, become tenants of the purchaser at the sale and shall deliver possession thereof immediately to the purchaser upon demand.  It shall not be necessary for the purchaser at said sale to bring any action for possession of the Collateral other than the statutory action of forcible detainer in any court having jurisdiction over the Collateral.

Section 4.9.  Additional Advances and Disbursements; Costs of Enforcement.

		
	(a)
	If Mortgagor shall fail, refuse or neglect to make any payment or perform any act required by the Loan Documents and such failure constitutes an Event of Default, then without notice to or demand upon Mortgagor or any other Person, and without waiving or releasing any other right, remedy or recourse Agent may have because of such Event of Default, Agent may (but shall not be obligated to) make such payment 

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or perform such act for the account of and at the expense of Mortgagor, provided that any such action by or on behalf of Agent of such non-performance or breach shall not be deemed to cure any such Event of Default.  All sums advanced and expenses incurred at any time by Agent under this Section 4.9, or otherwise under this Mortgage or any of the other Loan Documents or applicable law, shall be payable on demand and shall bear interest from the date of demand at the default rate of interest applicable under the Credit Agreement, and all such sums, together with interest thereon, shall be secured by this Mortgage.

		
	(b)
	Mortgagor shall pay, or at Agent’s option, reimburse Agent on demand for, all third party out-of-pocket expenses (including reasonable attorneys’ fees and expenses) of or incidental to the perfection and enforcement of this Mortgage and the other Loan Documents, or the enforcement, compromise or settlement of the Obligations or any claim under this Mortgage and the other Loan Documents, or for defending or asserting the rights and claims of Agent in respect thereof, by litigation or otherwise.  Such expenses shall include third party out-of-pocket expenses (including the reasonable fees and expenses of outside counsel for Agent) incurred in connection with (i) the preservation and enforcement of Agent’s liens and security interests under this Mortgage, (ii) the protection, exercise or enforcement of Agent’s rights with respect to the Property including Agent’s rights hereunder to (1) collect or take possession of the Property and the proceeds thereof, (2) hold the Property, (3) prepare the Property for sale or other disposition and (4) sell or otherwise dispose of the Property, and (iii) the assertion, protection, exercise or enforcement of Agent’s rights in any proceeding under the United States Bankruptcy Code, including the preparation, filing and prosecution of (1) proofs of claim, (2) motions for relief from the automatic stay, (3) motions for adequate protection, and (4) complaints, answers and other pleadings in adversary proceedings by or against Agent or relating in any way to the Property.  The duties and obligations of Agent under this Section 4.9(b) are in addition to, and not in lieu of, Agent’s duties and obligations under the Credit Agreement.

Section 4.10.  No Mortgagee-in-Possession. Neither the enforcement of any of the remedies under this Article 4, the assignment of the Leases and Rents under Article 5, the security interests under Article 6, nor any other remedies afforded to Agent or the Lenders under the Loan Documents, at law or in equity shall cause Agent (or the Lenders or any Lender)  to be deemed or construed to be a mortgagee-in-possession of the Collateral, to obligate Agent to lease the Collateral or attempt to do so, or to take any action, incur any expense, or perform or discharge any obligation, duty or liability whatsoever under any of the Leases or otherwise.

ARTICLE 5.

ASSIGNMENT OF LEASES AND RENTS

Section 5.1.  Assignment. Mortgagor unconditionally and absolutely assigns, transfers and sets over to Agent all of Mortgagor’s right, title and interest in and to: (a) all Leases; (b) all Lease Guaranties; and (c) all Rents.  This Assignment is an absolute assignment to Agent and not an assignment as security for the performance of the Obligations or any other indebtedness.  

Section 5.2.  Revocable License. Notwithstanding that Section 5.1 above is an absolute assignment of the Leases, Lease Guaranties, and Rents and not merely the collateral assignment of, or the grant of a lien or security interest in the Leases, Lease Guaranties, and Rents, Agent grants to Mortgagor a revocable license to collect, use and receive the Rents.  In addition, Mortgagor shall be permitted to enter into Leases and / or amend any such Leases and / or Lease Guaranties in Mortgagor’s ordinary course of business.  Such license may be revoked by Agent upon the occurrence and during the continuance of any Event of Default.

Section 5.3.  No Merger of Estates. So long as any part of the Obligations remain unpaid and undischarged, the fee and leasehold estates to the Collateral shall not merge, but shall remain separate and distinct, notwithstanding the union of such estates either in Mortgagor, Agent, any lessee or any third party by purchase or otherwise.
 

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ARTICLE 6.

SECURITY AGREEMENT

Section 6.1.  Security Agreement. This Mortgage shall constitute a security agreement under Article 9 of the UCC in each applicable jurisdiction with respect to the fixtures, now owned or hereafter acquired by Mortgagor, which might otherwise be deemed “fixtures” and all accessions thereto and the proceeds thereof.  Mortgagor has granted and does hereby grant Agent to and for the benefit of the Lenders a security interest in the fixtures and in all additions and accessions thereto, renewals and replacements thereof and all substitutions therefor and proceeds thereof for the purpose of securing all Obligations now or hereafter secured by this Mortgage. The following provisions relate to such security interest:

		
	(a)
	During the existence of an Event of Default, Agent shall have the rights and remedies of a secured party under the UCC as well as all other rights and remedies available at law or in equity or under this Mortgage. 

		
	(b)
	A description of the Land which relates to the fixtures is set forth in Exhibit A.  

		
	(c)
	Terms defined in the UCC and not otherwise defined in this Mortgage shall have the same meanings in this Article as are set forth in the UCC.  In the event that a term is used in Article 9 of the UCC and also in another Article of the UCC, the term used in this Article is that used in Article 9.  

		
	(d)
	Solely with respect to personal property, in the event of any conflict between the provisions of this Article 6 and the provisions of the Security Agreement, the provisions of the Security Agreement shall control.

ARTICLE 7.

MISCELLANEOUS

Section 7.1.  Notices. Any notice required or permitted to be given under this Mortgage shall be given and deemed delivered and received in the manner described in the Credit Agreement.

Section 7.2.  Covenants Running with the Property. All obligations contained in this Mortgage are intended by Mortgagor and Agent to be, and shall be construed as, covenants running with the Property.  As used herein, “Mortgagor” shall refer to the party named in the first paragraph of this Mortgage and to any subsequent owner of all or any portion of the Property (without in any way implying that Agent has or will consent to any such conveyance or transfer of the Property).  All persons or entities who may have or acquire an interest in the Property shall be deemed to have notice of, and be bound by, the terms of the Credit Agreement and the other Loan Documents; however, no such party shall be entitled to any rights thereunder without the prior written consent of Agent (which may be issued or withheld in Agent’s sole and absolute discretion).

Section 7.3.  Attorney-in-Fact. To the extent permitted by applicable law, Mortgagor hereby irrevocably appoints Agent and its successors and assigns, as its attorney-in-fact, which agency is coupled with an interest, (a) to execute and/or record any notices of completion, cessation of labor, or any other notices that Agent deems appropriate to protect Agent’s and the Lenders’ interest, if Mortgagor shall fail to do so within ten (10) days after written request by Agent, (b) upon the issuance of a deed pursuant to the foreclosure of this Mortgage or the delivery of a deed in lieu of foreclosure, to execute all instruments of assignment, conveyance or further assurance with respect to the Leases, Rents, and Fixtures in favor of the grantee of any such deed and as may be necessary or desirable for such purpose, (c) to prepare, execute and file or record financing statements, continuation statements, applications for registration and like papers necessary to create, perfect or preserve Agent’s security interests and rights in or to any of the Collateral, and (d) during the existence and continuance of an Event of Default, to perform any obligation of Mortgagor hereunder or under any of the other Loan Documents; however: (1) Agent shall not under any circumstances be obligated to perform any obligation of Mortgagor; (2) any sums advanced by Agent or the Lenders in such performance shall be added to and included in the Obligations and shall bear interest at the default rate of interest provided for under the 

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Credit Agreement after demand and shall be payable on demand; (3) Agent as such attorney-in-fact shall only be accountable for such funds as are actually received by Agent; and (4) neither Agent nor any Lender shall be liable to Mortgagor or any other person or entity for any failure to take any action which it is empowered to take under this Section 7.3.

Section 7.4.  Successors and Assigns. This Mortgage shall be binding upon and inure to the benefit of Agent, the Lenders and Mortgagor and their respective successors and assigns provided that Mortgagor shall not assign any rights, duties or obligations hereunder, except as may be expressly permitted under the Credit Agreement.

Section 7.5.  No Waiver. Any failure by Agent to insist upon strict performance of any of the terms, provisions or conditions of the Loan Documents shall not be deemed to be a waiver of same, and Agent shall have the right at any time to insist upon strict performance of all of such terms, provisions and conditions.

Section 7.6.  Subrogation. To the extent proceeds of the Loan have been used to extinguish, extend or renew any indebtedness against the Collateral, then Agent shall be subrogated to all of the rights, liens and interests existing against the Collateral and held by the holder of such indebtedness and such former rights, liens and interests, if any, are not waived, but are continued in full force and effect in favor of Agent.

Section 7.7.  Release or Reconveyance. Upon the full, final and indefeasible payment and performance of the Obligations in accordance with the terms of the Credit Agreement, Agent, at Mortgagor’s reasonable expense, shall release the liens and security interests created by this Mortgage or reconvey the Collateral to Mortgagor.

Section 7.8.  Waiver of Stay, Moratorium and Similar Rights.  Mortgagor agrees, to the full extent that it may lawfully do so, that it will not at any time insist upon or plead or in any way take advantage of any appraisement, valuation, stay, marshalling of assets, extension, redemption or moratorium law now or hereafter in force and effect so as to prevent or hinder the enforcement of the provisions of this Mortgage or the indebtedness secured hereby, or any agreement between Mortgagor and Agent or any rights or remedies of Agent.

Section 7.9.  Obligations of Mortgagor, Joint and Several.  If more than one person or entity has executed this Mortgage as “Mortgagor,” the obligations of all such persons or entities hereunder shall be joint and several.

Section 7.10.  Future Advances. This Mortgage covers present and future advances and readvances made by the Lenders to or for the benefit of Mortgagor and/or Borrowers pursuant to the Credit Agreement which will not at any time exceed the aggregate outstanding principal balance of $85,000,000.00.  It is the intent of the parties that the priority of the liens and security interests granted herein of such future advances shall relate back to the date of recording of this Mortgage.  Mortgagor covenants not to issue a cut-off notice to Agent until the Lenders have no further executory obligation to advance Loan proceeds and all of the Obligations have been fully and finally repaid.

Section 7.11.  Governing Law. In all respects, including all matters of construction, validity and performance, this Mortgage and the obligations arising hereunder shall be governed by, and construed and enforced in accordance with, the State of New York applicable to contracts made and performed in that state, and any applicable laws of the United States of America; except with respect to the creation, perfection and enforcement of liens, which shall be governed by and construed and enforced in accordance with the law of the state in which the Property is located.

Section 7.12.  Venue.  Any legal action or proceeding with respect to this Mortgage may be brought in the courts of the State of Indiana in Marion County and Mortgagor waives any objections which it may now or hereafter have based on venue and/or forum non-conveniens of any such legal action or proceeding.

Section 7.13.  Headings.  The Article, Section and Subsection titles hereof are inserted for convenience of reference only and shall in no way alter, modify or define, or be used in construing, the text of such Articles, Sections or Subsections.

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Section 7.14.  Entire Agreement.  This Mortgage and the other Loan Documents embody the entire agreement and understanding between Agent and Mortgagor and supersede all prior agreements and understandings between such parties relating to the subject matter hereof and thereof.  Accordingly, the Loan Documents may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties.  There are no oral agreements between the parties.

ARTICLE 8.

STATE-SPECIFIC PROVISIONS

Section 8.1.  Inconsistencies. In the event of any inconsistencies between the terms and conditions of this Article 8 and the other provisions of this Mortgage, the terms and conditions of this Article 8 shall control and be binding.

Section 8.2.  Definitions. Terms used in this Article 8 that are not otherwise defined in this Article 8 are given the same meanings as are otherwise set forth in this Mortgage.  The following terms and references have the following meanings for purposes of this Article 8 of this Mortgage:

		
	(a)
	Applicable Law means constitutional, statutory and case law in the State of Indiana (the “State”), including, but not by way of limitation, Mortgages, Ind. Code 32-29, Mortgage Foreclosure Actions, Ind. Code 32-30-10, Receiverships, Ind. Code 32-30-5, and the Uniform Commercial Code - Secured Transactions, Ind. Code 26-1-9.1 (the “UCC”), as amended, modified and/or recodified from time to time and all references in this Mortgage to Article 9 shall mean Article 9.1 of the UCC adopted in the State; provided, however, if by reason of mandatory provisions of law, the perfection, the effect of perfection or nonperfection, and the priority of the security interests in any collateral are governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State, UCC shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to perfection, effect of perfection or non-perfection, and the priority of the security interests in any such collateral.

		
	(b)
	County means the County in the State in which the Land is located.

Section 8.3.  Mortgage Foreclosure Actions. Any actions to be taken by Mortgagee in respect of the exercise of its remedies hereunder and the enforcement of this Mortgage shall be subject to all applicable provisions of Indiana law regulating the creation or enforcement of a lien or security interest in real or personal property including, but not by way of limitation, Ind. Code 32-30-1, et seq., “Mortgage Foreclosure Actions,” and the Code, as amended, modified and/or replaced from time to time.  In the event of any inconsistencies between the terms hereof and the provisions of such laws, the provisions of Indiana law shall take precedence over the provisions of this Mortgage, but same shall not invalidate or render unenforceable any other provisions of this Mortgage that can be construed in a manner consistent with Indiana law.

Section 8.4.  Maturity Date.  The Obligations hereby secured, if not earlier accelerated, have a final maturity date of September 26, 2019.

Section 8.5.  Obligations Secured. Pursuant to Ind. Code 32-29-1-10, and notwithstanding anything contained in this Mortgage or the other Loan Documents to the contrary, this Mortgage shall secure: (a) a maximum principal amount of $85,000,000.00, exclusive of any items described in clause (b) below, including any additional advances made from time to time after the date hereof pursuant to the other Loan Documents whether made as part of the obligations secured hereby, made at the option of the Agent made after a reduction to a zero or other balance, or made otherwise; and (b) all other amounts payable by Mortgagor, or advanced by Agent for the account, or on behalf, of Mortgagor, pursuant to the other Loan Documents, including amounts advanced with respect to the Collateral for the payment of taxes, assessments, insurance premiums and other costs and impositions incurred for the protection of the Collateral to the same extent as if the future obligations and advances were made on the date of execution of the Mortgage.

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Section 8.6.  Remedies of Agent. Notwithstanding anything in this Mortgage or any other Loan Document to which Mortgagor is a party to the contrary, Agent shall be entitled to all rights and remedies that an Agent would have under Applicable Law.  In the event of any inconsistency between the provisions of this Mortgage and the provisions of Applicable Law, the provisions of Applicable Law shall take precedence over the provisions of this Mortgage, but shall not invalidate or render unenforceable any other provisions of this Mortgage that can be construed in a manner consistent with Applicable Law.  Agent shall be vested with the rights and remedies granted under Applicable Law.  Notwithstanding any provision in this Mortgage relating to a power of sale or other provision for sale of the Collateral upon an Event of Default other than under a judicial proceeding, any sale of the Collateral pursuant to this Mortgage will be made through a judicial proceeding, except as otherwise may be permitted under the UCC.

Section 8.7.  Available Remedies. To the extent Applicable Law limits: (a) the availability of the exercise of any of the remedies set forth in this Mortgage, including without limitation the remedies involving a power of sale on the part of Agent and the right of Agent to exercise self-help in connection with the enforcement of the terms of this Mortgage, or (b) the enforcement of waivers and indemnities made by Mortgagor, such remedies, waivers, or indemnities shall be exercisable or enforceable, any provisions in this Mortgage to the contrary notwithstanding, if, and to the extent, permitted by the laws in force at the time of the exercise of such remedies or the enforcement of such waivers or indemnities without regard to whether such remedies, waivers or indemnities were enforceable at the time of the execution and delivery of this Mortgage.

Section 8.8.  Assignment of Rents. Without limiting the scope of the assignment of Rents contained in this Mortgage, the assignment of Rents set forth herein shall constitute an assignment of rents as set forth in Ind. Code 32-21-4-2 and Ind. Code 32-29-1-11 and thereby creates, and Mortgagor hereby grants to Agent, a security interest in the Rents that will be perfected upon the recording of this Mortgage. Such assignment shall run with the Land and be good and valid as against Mortgagor and those claiming by, under or through Mortgagor, from the date of recording of this Mortgage. Such assignment shall continue to be operative during the foreclosure or any other proceedings taken to enforce this Mortgage. Such assignment does not and shall not be construed as obligating Agent to perform any of the covenants or undertakings required to be performed by Mortgagor in any Leases or make Agent or any of its successors or assigns otherwise responsible or liable in any manner with respect to Leases or Rents or the use, occupancy, enjoyment or any portion of the Collateral.

Section 8.9.  Fixture Filing. It is intended that as to the Fixtures that are or are to become part of the Collateral hereby mortgaged, this Mortgage shall be effective as a continuously perfected financing statement filed as a fixture filing from the date of the filing of this Mortgage for record with the Recorder of the County, pursuant to Ind. Code 26-1-9.1-502 and Ind. Code 26-1-9.1-515. This information is provided in order that this Mortgage shall comply with the requirements of the UCC, for a mortgage instrument to be filed as a continually perfected financing statement. This Mortgage covers goods which are or are to become Fixtures.

	
		
	Name of Debtor:
	AL Real Estate Holdings, LLC
c/o Angie's List, Inc.

	 
	 

	Address of Debtor:
	1030 East Washington Street
Indianapolis, Indiana 46202

	 
	 

	Type of Organization:
	Corporation

	 
	 

	State of Organization:
	Delaware

	 
	 

	Name of Secured Party:
	TCW Asset Management Company, as Agent

	 
	 

	Address of Secured Party:
	865 South Figueroa Street, Suite 1800
Los Angeles, CA 90017

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Mortgagor hereby acknowledges receipt of a copy of this Mortgage in compliance with Agent’s obligation to deliver a copy of the fixture filing to Mortgagor pursuant to Section 9.1-502(f) of the UCC.

Section 8.10.  Defined Terms. To the extent necessary to interpret any provision of this Mortgage and any other Loan Document to which Mortgagor is a party are hereby incorporated by reference into this Mortgage with the same effect as if set forth herein. In the event that any such incorporated provisions of any other Loan Document to which Mortgagor is a party are inconsistent with the provisions hereof, the provisions of the other Loan Document to which Mortgagor is a party shall govern and control to the extent of the inconsistency; provided, however, the provisions of this Article 8 shall govern and control in all circumstances, anything in this Mortgage or any other Loan Document to which Mortgagor is a party to the contrary notwithstanding.

Section 8.11.  Survival. Any of the terms and provisions of Article 8 of this Mortgage that are intended to survive, shall nevertheless survive the release or satisfaction of this Mortgage whether voluntarily granted by Agent, as a result of a judgment upon judicial foreclosure of this Mortgage or in the event a deed in lieu of foreclosure is granted by Mortgagor to Agent. 

Section 8.12.  Judgments and Decrees. The Obligations secured hereby shall include all judgments or final decrees rendered to collect any of the Obligations of Mortgagor to Agent and/or enforce the performance or collection of all rights, remedies, covenants, agreements, conditions, indemnities, representations, warranties, and other liabilities, covenants, agreements, and any other obligations and liabilities of Mortgagor under this Mortgage, and any other Loan Document to which Mortgagor is a party; provided, however, such Obligations and other obligations and liabilities shall not include any judgment(s) or final decree(s) rendered in another jurisdiction, which judgment(s) or final decree(s) would be unenforceable by a State Court pursuant to Ind. Code 34-54-3-4. The obtaining of any judgment by Agent (other than a judgment foreclosing this Mortgage) and any levy of any execution under any such judgment upon the Collateral shall not affect in any manner or to any extent the lien of this Mortgage upon the Collateral or any part thereof, or any liens, powers, rights and remedies of Agent hereunder, but such liens, powers, rights and remedies shall continue unimpaired as before until the judgment or levy is satisfied.

Section 8.13.  No Liability of Agent. It is understood and agreed that neither this Mortgage nor the exercise by Agent of any of its rights or remedies under this Mortgage shall be deemed to make Agent a “mortgagee-in-possession” or otherwise responsible or liable in any manner with respect to the leases or rents or the use, occupancy, enjoyment or any portion of the Collateral, unless and until Agent, in person or by agent, assumes actual possession thereof; provided, however, no appointment of a receiver for the Collateral by any court at the request of Agent or by agreement with Mortgagor, or the entering into possession of any part of the Collateral by such receiver, shall be deemed to make Agent a “mortgagee-in-possession” or otherwise responsible or liable in any manner with respect to the Collateral or the use, occupancy, enjoyment or operation of all or any portion thereof.

Section 8.14.  Enforcement Actions. If Agent brings an action against Mortgagor in the State to recover judgment under this Mortgage or any other Loan Document to which Mortgagor is a party and during the pendency of such action brings a separate action in the State under this Mortgage, such actions shall be consolidated if and to the extent required pursuant to Applicable Law. 

Section 8.15.  Additional Collateral. If, after the date of this Mortgage, Mortgagor acquires any property located on and used in connection with the Collateral and that by the terms of this Mortgage is required or intended to be encumbered by this Mortgage, the property shall become subject to the lien and security interest of this Mortgage immediately upon its acquisition by Mortgagor and without any further mortgage, conveyance, assignment or transfer. Nevertheless, upon Agent’s request at any time Mortgagor will execute, acknowledge and deliver any additional instruments and assurances of title and will do or cause to be done anything further that is reasonably necessary for carrying out the intent of this Mortgage.

Section 8.16.  Foreclosure Sale Proceeds. The proceeds of any foreclosure sale of the Collateral shall be distributed and applied pursuant to this Mortgage and the Credit Agreement, to the extent permitted by Applicable Law.

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Section 8.17.  Appointment of Receiver. Mortgagor agrees that Agent shall be entitled to the appointment of a receiver as a matter of right in accordance with Ind. Code § 32-30-5-1(4)(C) in any action brought by Agent seeking to enforce this Mortgage, including without limitation, by judicial foreclosure and subject to the terms and provisions of this Mortgage and the Credit Agreement, any such receiver, when duly appointed, shall have all of the powers and duties of receivers pursuant to Applicable Law.

Section 8.18.  Power of Attorney. In no event shall any power of attorney granted herein give to Agent the right or the power of attorney or authority as attorney on behalf of Mortgagor to: (a) appear in any court of record and waive the service of process in an action to enforce the payment of money claimed to be due on or under this Mortgage; (b) confess judgment on this Mortgage for a sum of money to be ascertained in a manner other than by action of the court upon a hearing after notice to Mortgagor; or (c) release errors and rights of appeal from a judgment rendered for the matters described in subclause (a) or (b) hereof or to consent to the issue of execution on the judgment or the matters described in subclause (a) or (b) hereof.

Section 8.19. Non-Waiver. Nothing herein constitutes or is intended to constitute a waiver by Mortgagor of the time limitation on issuance of process under Ind. Code § 32-29-7-3 or a waiver by Mortgagor or Agent of any rights under Ind. Code § 32-29-7-5.

Section 8.20.  Attorneys Fees; Costs of Enforcement and Collateral Preservation. In any action to enforce or to foreclose the lien of this Mortgage, Agent shall be entitled to recover from Mortgagor its reasonable attorneys’ and paralegals’ fees, and all third party out-of-pocket costs and expenses incurred, whether incurred in court-ordered mediation, at trial, on appeal, or in bankruptcy and administrative proceedings, and including but not limited to any costs for environmental reports, appraisals, property inspections and inspection reports, title searches and reports, surveys, and costs of a similar nature incurred by Agent for the Collateral.

Section 8.21.  UCC Remedies. Notwithstanding anything in this Mortgage to the contrary, if an Event of Default shall occur and be continuing, Mortgagor further agrees, at Agent’s request, to assemble the personal property and make it available to Agent at the Property.

Section 8.22.  Collection Cost Recovery. This Mortgage shall secure, and Agent shall be entitled to collect from Mortgagor and add to the obligations incurred by Mortgagor under the Loan pursuant to the terms of the Credit Agreement, including, without limitation, in any proceeding to enforce this Mortgage or foreclose upon the Collateral, all  expenses of any environmental site assessments, environmental audits, environmental remediation costs, appraisals, surveys, engineering studies, wetlands delineations, flood plain studies, and any other similar testing or investigation reasonably deemed necessary or advisable by Agent incurred in preparation for, contemplation of or in connection with the enforcement of this Mortgage and/or the collection of the Obligations.

Section 8.23.  Enforcement Action. Nothing in this Mortgage or the other Loan Documents shall be deemed to preclude Agent from filing any action, suit or proceeding in respect of this Mortgage or the Obligations in the State or the courts of the United States of America located in the State.

Section 8.24.  Hazard Insurance Coverage. Anything contained in this Mortgage, the Credit Agreement or the other Loan Documents to the contrary, Agent or Agent’s assignee, or representative may not require Mortgagor, as a condition of receiving or maintaining this Mortgage to obtain hazard insurance coverage against risks to Improvements in an amount exceeding the replacement value of the Improvements in violation of Ind. Code 32-29-1-2.5.

Section 8.25.  Business Purpose. This Mortgage secures indebtedness incurred for business or commercial purposes, and the proceeds thereof will not be used for personal, family, residential, household or agricultural purposes.

[Remainder of this page intentionally left blank; Signature page to follow]

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IN WITNESS WHEREOF, this Mortgage has been executed by Mortgagor and is effective as of the day and year first above written.

	
		
	AL Real Estate Holdings, LLC, an Indiana
limited liability company

	 
	 

	By:
	/s/ J. Mark Howell

	Name:
	J. Mark Howell

	Title:
	Manager and President

	
			
	STATE OF INDIANA
	)

	 
	 
	) SS

	COUNTY OF
	Marion
	)

Personally came before me this 9th day of June, 2016, the above named J. Mark Howell, as Manager & President of AL Real Estate Holdings, LLC, an Indiana limited liability company, to me known to be the person who executed the foregoing instrument and acknowledged the same as the act and deed of AL Real Estate Holdings, LLC.

	
		
	/s/ JANE R. DUCHARME

	Notary Public

	Printed Name:
	Jane R. Ducharme

	My Commission Expires:
	10/21/23

	My County of Residence:
	Marion

[SEAL]

I affirm, under penalties for perjury, that I have taken reasonable care to redact each Social Security number in this document, unless required by law.  D. Eric Remensperger, Esq.

This instrument prepared by: D. Eric Remensperger, Esq., Proskauer Rose LLP, 2049 Century Park East, Suite 3200, Los Angeles, California  90067

[Signature and Acknowledgment Page to Mortgage]

EXHIBIT A

LEGAL DESCRIPTION

1050 East Washington Street:

Part of the South end of the West Half of the Southwest Quarter of Section 6, Township 15 North, Range 4 East of the Second Principal Meridian, in Marion County, Indiana, being the combined area of the following Lots, Tracts or Strips of land.

1. The East 15 feet of Lot 7 and all of Lots 8 and 9 in Northrup and Huston's Addition as per plat thereof recorded in Plat Book 6, page 103, the deed for which is recorded as Instrument Number 69463-46, in the Office of the Recorder of Marion County, Indiana.

2. ALSO: A 12 foot alley located between Lots 9 and 10 in Northrup and Huston's Addition as per plat thereof recorded in Plat Book 6, page 103, vacated by Resolution Number 16237, recorded in the Office of the Recorder of Marion County, Indiana.

3.  ALSO; Lot 10 in said in Northrup and Huston's Addition as per plat thereof recorded in Plat Book 6, page 103, the deed for which is recorded as Instrument Number 10589-40, in the Office of the Recorder of Marion County, Indiana.

4. ALSO: All of Lot 1 in Davidson's 1st Addition as per plat thereof recorded in Plat Book 2, page 104, in the Office of the Recorder of Marion County, Indiana, lying South of the 15 foot alley North of Washington Street, the description of said alley being the same as that recorded in Mortgage Record 627, page 279. EXCEPT therefrom a strip of land 50 feet in width by169.6 feet in depth off of the East side thereof, the deed for the remainder of the said Lot 1 South of said alley being that recorded as Instrument Number 10589-40 in the Office of the Recorder of Marion County, Indiana.

5. ALSO: Part of Lot 1 in said Davidson's 1st Addition as per plat thereof recorded in Plat Book 2 page 104, in the Office of the Recorder of Marion County, Indiana, being a 50 foot strip of land by 169 feet and 6 inches in depth in the southeast comer of said Lot 1, (shown as an exception in Instrument Number 10589), the deed for which is recorded as Instrument Number 10588-40, in the Office of the Recorder of Marion County, Indiana.

All of which is more particularly described as follows:

Beginning at the Southeast corner of said Lot 1, said point being on the North right-of-way line of Washington Street, and running thence North 00 degrees 07 minutes 29 seconds West along the East line thereof a distance of 169.6 feet by deed, 167.94 feet measured, to the South line of the 1st alley North of Washington Street, opened by the Board of Public Works in May 1913, described in Mortgage Record 627, page 279; thence South 89 degrees 33 minutes 51 seconds West along the South line of said alley a distance of 175.00 feet to a point on the Eastern terminus of the alley running East and West in referenced Northrup and Huston's Addition; thence South 00 degrees 07 minutes 29 seconds East along the East terminus of said alley a distance of 1.38 feet to the South line extended East of the said East-West alley that is a part of the Northrup and Huston's Addition; thence South 89 degrees 43 minutes 40 seconds West along the South line of said alley a distance of 72.00 feet by deal, 71.78 feet measured to a point on the North line of Lot 7, 15 feet by deed Westward from the Northeast corner thereof; thence Southward by Plat parallel to the East line of Northrup and Huston's Addition, a plat distance of 169.5 feet, South 00 degrees 02 minutes 50 seconds East a distance of 166.06 feet measured to the North right-of-way line of Washington Street; thence North 89 degrees 43 minutes 40 seconds East a distance of 247.00 feet to the point of beginning.

EXCEPT THEREFROM: A grip of land lying adjacent to and North of the North end of Lot 10 of the Northrup and Huston's Addition and being of even width there-with and approximately 1.38 feet in depth, said strip of land appearing 

to have been a part of Lot 11 of said Addition that was separated from said Lot 11 by the opening of the 15 foot East-West alley described in Mortgage Record 627 page 279.

ALSO EXCEPTING THEREFROM: A strip of land 50 feet in width and approximately 1.88 feet in depth lying between the North end of the 50 foot strip of land the deed for which is recorded as Instrument Number 15088 and the South line of a 15 foot alley, opened by the Board of Public Works in May, 1913, the description of which is recorded in Mortgage Record 627, page 279.

1122 East Washington Street:

Lots 1, 2, 3, 4 and 5 in Latham’s Subdivision, being a Subdivision of Lot 2 in Davidsons First Addition, an Addition to the City of Indianapolis, as per plat thereof, recorded in Plat Book 15, page 34, in the office of the Recorder of Marion County, Indiana.SECURITIES
PURCHASE AGREEMENT

 

This
SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of June 9, 2016, by and between CACHET FINANCIAL
SOLUTIONS, INC., a Delaware corporation, with headquarters located at 18671 Lake Drive East, Southwest Tech Center A, Minneapolis,
MN 55317 (the “Company”), and [Investor Name], a [Investor Entity Type], with its address at [Investor Address]
(the “Buyer”).

 

WHEREAS:

 

A.The
Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from the offer and sale of securities
afforded by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC”)
under the Securities Act of 1933, as amended (the “1933 Act”);

 

B.Buyer
desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement, a convertible
note of the Company, in the form attached hereto as Exhibit A, in the aggregate principal amount of US$450,000.00 (the
“Note”), convertible into shares of common stock, of the Company (the “Common Stock”), upon the terms
and subject to the limitations and conditions set forth in such Note. In connection with the issuance of the Note, the Company
shall issue to Buyer warrants to purchase 1,125,000 shares of its common stock (consisting of warrants to purchase 750,000 shares
of its common stock to be effective upon Buyer’s funding of the First Tranche Purchase Price (as defined herein), and warrants
to purchase 375,000 shares of its common stock to be effective as of the funding date of the remaining $125,000.00 of the Consideration
(as defined in the Note) under the Note). 

 

C.The
Buyer wishes to purchase, upon the terms and conditions stated in this Agreement, such principal amount of Note as is set forth
immediately below its name on the signature pages hereto; and

 

NOW
THEREFORE, the Company and the Buyer severally (and not jointly) hereby agree as follows:

 

1.PURCHASE
AND SALE OF NOTE.

 

a.Purchase
of Note. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer agrees to purchase
from the Company, such principal amount of Note as is set forth immediately below the Buyer’s name on the signature pages
hereto, subject to the express terms of the Note.

 

    	 	 	 

     

    

 

b.Form
of Payment. On the Closing Date (as defined below), the Buyer shall pay the purchase price for the first tranche of the Note,
which is equal to $225,000.00 (the “First Tranche Purchase Price”) by wire transfer of immediately available funds,
in accordance with the Company’s written wiring instructions, against delivery of the Note, and (i) the Company shall deliver
such duly executed Note, on behalf of the Company, to the Buyer. The Buyer may fund additional tranches under the Note, pursuant
to the terms and conditions of the Note and in accordance with the Company’s written wiring instructions. 

 

c.Closing
Date. Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below,
the date and time of the issuance and sale of the Note pursuant to this Agreement (the “Closing Date”) shall be 5:00
P.M., Eastern Standard Time on or about June 9, 2016, or such other mutually agreed upon time. The closing of the transactions
contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to
by the parties.

 

2.REPRESENTATIONS
AND WARRANTIES OF THE BUYER. The Buyer represents and warrants to the Company that:

 

a.Investment
Purpose. As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of
or otherwise pursuant to the Note (including, without limitation, such additional shares of Common Stock, if any, as are issuable
(i) on account of interest on the Note or (ii) under any other provision in the Note, such shares of Common Stock being collectively
referred to herein as the “Conversion Shares” and, collectively with the Note, the “Securities”) for its
own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or
exempted from registration under the 1933 Act; provided, however, that by making the representations and warranties
herein, the Buyer does not agree to hold any of the Securities for any minimum or other specific term and reserves the right to
dispose of the Securities at any time in accordance with or pursuant to a registration statement or an exemption under the 1933
Act, subject in all respects to compliance with the registration or re-sale provisions of this Agreement, as applicable.

 

b.Accredited
Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D
(an “Accredited Investor”).

 

c.Reliance
on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions
from the registration requirements of United States federal and state securities laws and that the Company is relying upon the
truth and accuracy of, and the Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and
understandings of the Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of
the Buyer to acquire the Securities.

 

    	 	2	 

     

    

 

d.Information.
The Buyer and its advisors, if any, have been, and for so long as the Note remains outstanding will continue to be, furnished
with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale
of the Securities which have been reasonably requested by the Buyer or its advisors. The Buyer and its advisors, if any, have
been, and for so long as the Note remains outstanding will continue to be, afforded the opportunity to ask questions of the Company.
Notwithstanding the foregoing, the Buyer agrees and understands that the Company has not disclosed to the Buyer any material nonpublic
information and will not disclose such information unless such information is disclosed to the public prior to or promptly following
such disclosure to the Buyer. The Buyer understands that its investment in the Securities involves a significant degree of risk.
The Buyer is not aware of any facts that may constitute a breach of any of the Company’s representations and warranties
made herein.

 

e.Governmental
Review. The Buyer understands that no United States federal or state agency or any other government or governmental agency
has passed upon or made any recommendation or endorsement of the Securities.

 

f.Transfer
or Re-sale. The Buyer understands that (i) the sale or re-sale of the Securities has not been and is not being registered
under the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless (a) the Securities
are sold pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company,
at the cost of the Buyer, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in
comparable transactions to the effect that the Securities to be sold or transferred may be sold or transferred pursuant to an
exemption from such registration, which opinion shall be accepted by the Company, (c) the Securities are sold or transferred to
an “affiliate” (as defined in Rule 144 promulgated under the 1933 Act (or a successor rule) (“Rule 144”))
of the Buyer who agrees to sell or otherwise transfer the Securities only in accordance with this Section 2(f) and who is an Accredited
Investor, (d) the Securities are sold pursuant to Rule 144, or (e) the Securities are sold pursuant to Regulation S under the
1933 Act (or a successor rule) (“Regulation S”), and the Buyer shall have delivered to the Company, at the cost of
the Buyer, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions,
which opinion shall be accepted by the Company; (ii) any sale of such Securities made in reliance on Rule 144 may be made only
in accordance with the terms of said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances
in which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined
in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder;
and (iii) neither the Company nor any other person is under any obligation to register such Securities under the 1933 Act or any
state securities laws or to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the
foregoing or anything else contained herein to the contrary, the Securities may be pledged as collateral in connection with a
bona fide margin account or other lending arrangement. 

 

    	 	3	 

     

    

 

g.Legends.
The Buyer understands that the Note and Conversion Shares, until such time as the Conversion Shares have been registered under
the 1933 Act or may be sold pursuant to Rule 144 or Regulation S, or other valid exemption, without any restriction as to the
number of securities as of a particular date that can then be immediately sold, will bear a restrictive legend in substantially
the following form (and a stop-transfer order may be placed against transfer of the certificates for such Securities):

 

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

 

The
legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of any Security
upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Security is registered for
sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or Regulation
S without any restriction as to the number of securities as of a particular date that can then be immediately sold, or (b) such
holder provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable
transactions, to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act,
which opinion shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities,
including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus
delivery requirements, if any. In the event that the Company does not accept the opinion of counsel provided by the Buyer with
respect to the transfer of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation S, at the Deadline,
it will be considered an Event of Default pursuant to Section 3.2 of the Note.

 

    	 	4	 

     

    

 

h.Authorization;
Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf
of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.

 

i.Residency.
If the Buyer is a natural person, the Buyer is a resident of the jurisdiction set forth immediately below the Buyer’s name
on the signature pages hereto. 

 

3.REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. The Company represents and warrants to the Buyer that, except as disclosed in the SEC Documents
(as defined below), that:

 

a.Organization
and Qualification. The Company and its Subsidiary (as defined below) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate and
other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated
and conducted. The Company and its Subsidiary are duly qualified as a foreign corporation to do business and is in good standing
in every jurisdiction in which its ownership or use of property or the nature of the business conducted by each makes such qualification
necessary except where the failure to be so qualified or in good standing would not have a Material Adverse Effect. “Material
Adverse Effect” means any material adverse effect on the business, operations, assets, financial condition or prospects
of the Company or its Subsidiary taken as a whole, or on the transactions contemplated hereby or by the agreements or instruments
to be entered into in connection herewith. “Subsidiary” shall mean Cachet Financial Solutions, Inc., a Minnesota corporation.

 

b.Authorization;
Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the
Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms
hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the consummation by it of the
transactions contemplated hereby and thereby (including without limitation, the issuance of the Note and the issuance and reservation
for issuance of the Conversion Shares issuable upon conversion or exercise thereof) have been duly authorized by the Company’s
Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its stockholders is required,
(iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized
representative is the true and official representative with authority to sign this Agreement and the other documents executed
in connection herewith and bind the Company accordingly, and (iv) this Agreement constitutes, and upon execution and delivery
by the Company of the Note, each of such instruments will constitute, a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, subject to the extent the foregoing may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and by general
principals of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

 

    	 	5	 

     

    

 

c.Capitalization.
Except as disclosed in the SEC Documents (as defined below), and for other convertible indebtedness of less than $1,50,000.00
and related warrants, and for issuances in the ordinary course of business, no shares are reserved for issuance pursuant to the
Company’s stock option plans, no shares are reserved for issuance pursuant to securities (other than the Securities) exercisable
for, or convertible into or exchangeable for shares of Common Stock. All of such outstanding shares of capital stock are, or upon
issuance will be, duly authorized, validly issued, fully paid and non-assessable. No shares of capital stock of the Company are
subject to preemptive rights or any other similar rights of the stockholders of the Company or any liens or encumbrances imposed
through the actions or failure to act of the Company. Except as disclosed in the SEC Documents and for other convertible indebtedness
of less than $1,50,000.00 and related warrants, and for issuances in the ordinary course of business, as of the effective date
of this Agreement, (i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first
refusal, agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities
or rights convertible into or exchangeable for any shares of capital stock of the Company or its Subsidiary, or arrangements by
which the Company or its Subsidiary is or may become bound to issue additional shares of capital stock of the Company or its Subsidiary,
(ii) there are no agreements or arrangements under which the Company or any of its Subsidiary is obligated to register the sale
of any of its or their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained
in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the
issuance of the Note or the Conversion Shares. The Company has filed in its SEC Documents true and correct copies of the Company’s
Certificate of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), the Company’s
By-laws, as in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable
for Common Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the
Buyer with a written update of this representation signed by the Company’s Chief Executive Officer on behalf of the Company
as of the Closing Date.

 

d.Issuance
of Shares. The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Note, in accordance
with its respective terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances
with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the
Company and will not impose personal liability upon the holder thereof.

 

e.Acknowledgment
of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance
of the Conversion Shares upon conversion of the Note. The Company further acknowledges that its obligation to issue Conversion
Shares upon conversion of the Note in accordance with this Agreement, the Note is absolute and unconditional regardless of the
dilutive effect that such issuance may have on the ownership interests of other stockholders of the Company.

 

    	 	6	 

     

    

 

f.No
Conflicts. The execution, delivery and performance of this Agreement and the Note by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance
of the Conversion Shares) will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation
or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event
which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or its Subsidiary
is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state
securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities are
subject) applicable to the Company or its Subsidiary or by which any property or asset of the Company or its Subsidiary is bound
or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would
not, individually or in the aggregate, have a Material Adverse Effect). Neither the Company nor its Subsidiary is in violation
of its Certificate of Incorporation, By-laws or other organizational documents and neither the Company nor its Subsidiary is in
default (and no event has occurred which with notice or lapse of time or both could put the Company or its Subsidiary in default)
under, and neither the Company nor its Subsidiary has taken any action or failed to take any action that would give to others
any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company
or its Subsidiary is a party or by which any property or assets of the Company or its Subsidiary is bound or affected, except
for possible defaults as would not, individually or in the aggregate, have a Material Adverse Effect. The businesses of the Company
and its Subsidiary are not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in violation
of any law, ordinance or regulation of any governmental entity. Except as specifically contemplated by this Agreement and as required
under the 1933 Act and any applicable state securities laws, the Company is not required to obtain any consent, authorization
or order of, or make any filing or registration with, any court, governmental agency, regulatory agency, self-regulatory organization
or stock market or any third party in order for it to execute, deliver or perform any of its obligations under this Agreement,
the Note in accordance with the terms hereof or thereof or to issue and sell the Note in accordance with the terms hereof and
to issue the Conversion Shares upon conversion of the Note. All consents, authorizations, orders, filings and registrations which
the Company is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof.
The Company is not in violation of the listing requirements of the Over-the-Counter Bulletin Board (the “OTCBB”),
the OTCQB or any similar quotation system, and does not reasonably anticipate that the Common Stock will be delisted by the OTCBB,
the OTCQB or any similar quotation system, in the foreseeable future. The Company and its Subsidiary are unaware of any facts
or circumstances which might give rise to any of the foregoing. 

 

    	 	7	 

     

    

 

g.SEC
Documents; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required
to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the
“1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements
and schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being hereinafter
referred to herein as the “SEC Documents”). The Company has delivered to the Buyer true and complete copies of the
SEC Documents, except for such exhibits and incorporated documents. As of their respective dates, the SEC Documents complied in
all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable
to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading. None of the statements made in any such SEC
Documents is, or has been, required to be amended or updated under applicable law (except for such statements as have been amended
or updated in subsequent filings prior the date hereof). As of their respective dates, the financial statements of the Company
included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with United
States generally accepted accounting principles, consistently applied, during the periods involved and fairly present in all material
respects the consolidated financial position of the Company and its consolidated Subsidiary as of the dates thereof and the consolidated
results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal
year-end audit adjustments). Except as set forth in the financial statements of the Company included in the SEC Documents, the
Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business, and
(ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally
accepted accounting principles to be reflected in such financial statements, which, individually or in the aggregate, are not
material to the financial condition or operating results of the Company. The Company is subject to the reporting requirements
of the 1934 Act. For the avoidance of doubt, filing of the documents required in this Section 3(g) via the SEC’s Electronic
Data Gathering, Analysis, and Retrieval system (“EDGAR”) shall satisfy all delivery requirements of this Section 3(g).

 

h.Absence
of Certain Changes. There has been no material adverse change and no material adverse development in the assets, liabilities,
business, properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status of the Company
or its Subsidiary.

 

i.Absence
of Litigation. There is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body pending or, to the knowledge of the Company or its Subsidiary, threatened
against or affecting the Company or its Subsidiary, or their officers or directors in their capacity as such, that could have
a Material Adverse Effect, except as set forth in the SEC Documents. The SEC Documents include a complete list and summary description
of any pending or, to the knowledge of the Company, threatened proceeding against or affecting the Company or its Subsidiary,
without regard to whether it would have a Material Adverse Effect. The Company and its Subsidiary are unaware of any facts or
circumstances which might give rise to any of the foregoing.

 

    	 	8	 

     

    

 

j.Patents,
Copyrights, etc. Except as set forth in the SEC Documents, the Company and its Subsidiary owns or possesses the requisite
licenses or rights to use all patents, patent applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark
applications, service marks, service names, trade names and copyrights (“Intellectual Property”) necessary to enable
it to conduct its business as now operated (and, as presently contemplated to be operated in the future); Except as disclosed
in the SEC Documents, there is no claim or action by any person pertaining to, or proceeding pending, or to the Company’s
knowledge threatened, which challenges the right of the Company or of a Subsidiary with respect to any Intellectual Property necessary
to enable it to conduct its business as now operated (and, as presently contemplated to be operated in the future); to the best
of the Company’s knowledge, the Company’s or its Subsidiary’s current and intended products, services and processes
do not infringe on any Intellectual Property or other rights held by any person; and the Company is unaware of any facts or circumstances
which might give rise to any of the foregoing. The Company and its Subsidiary have taken reasonable security measures to protect
the secrecy, confidentiality and value of their Intellectual Property.

 

k.No
Materially Adverse Contracts, Etc. Neither the Company nor its Subsidiary is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation which in the judgment of the Company’s officers has or is
expected in the future to have a Material Adverse Effect. Neither the Company nor its Subsidiary is a party to any contract or
agreement which in the judgment of the Company’s officers has or is expected to have a Material Adverse Effect.

 

l.Tax
Status. The Company and its Subsidiary has made or filed all federal, state and foreign income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company and
its Subsidiary has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes) and
has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on
such returns, reports and declarations, except those being contested in good faith and has set aside on its books provisions reasonably
adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Company know of no basis for any such claim. The Company has not executed a waiver with respect to the statute of limitations
relating to the assessment or collection of any foreign, federal, state or local tax. None of the Company’s tax returns
is presently being audited by any taxing authority.

 

    	 	9	 

     

    

 

m.Certain
Transactions. Except for arm’s length transactions pursuant to which the Company or its Subsidiary makes payments in
the ordinary course of business upon terms no less favorable than the Company or its Subsidiary could obtain from third parties
and other than as disclosed in the SEC Documents, none of the officers, directors, or employees of the Company is presently a
party to any transaction with the Company or its Subsidiary (other than for services as employees, officers and directors), including
any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or
personal property to or from, or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge
of the Company, any corporation, partnership, trust or other entity in which any officer, director, or any such employee has a
substantial interest or is an officer, director, trustee or partner.

 

n.Disclosure.
All information relating to or concerning the Company or its Subsidiary set forth in this Agreement and provided to the Buyer
pursuant to Section 2(d) hereof and otherwise in connection with the transactions contemplated hereby is true and correct in all
material respects and the Company has not omitted to state any material fact necessary in order to make the statements made herein
or therein, in light of the circumstances under which they were made, not misleading. No event or circumstance has occurred or
exists with respect to the Company or its Subsidiary or its or their business, properties, prospects, operations or financial
conditions, which, under applicable law, rule or regulation, requires public disclosure or announcement by the Company but which
has not been so publicly announced or disclosed (assuming for this purpose that the Company’s reports filed under the 1934
Act are being incorporated into an effective registration statement filed by the Company under the 1933 Act).

 

o.Acknowledgment
Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees that the Buyer is acting solely in the
capacity of arm’s length purchasers with respect to this Agreement and the transactions contemplated hereby. The Company
further acknowledges that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity)
with respect to this Agreement and the transactions contemplated hereby and any statement made by the Buyer or any of its respective
representatives or agents in connection with this Agreement and the transactions contemplated hereby is not advice or a recommendation
and is merely incidental to the Buyer’ purchase of the Securities.

 

p.No
Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly
or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would
require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the
Buyer will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes
of any stockholder approval provisions applicable to the Company or its securities.

 

    	 	10	 

     

    

 

q.No
Brokers. The Company has taken no action which would give rise to any claim by any person for brokerage commissions, transaction
fees or similar payments relating to this Agreement or the transactions contemplated hereby.

 

r.Permits;
Compliance. The Company and its Subsidiary are in possession of all franchises, grants, authorizations, licenses, permits,
easements, variances, exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its properties
and to carry on its business as it is now being conducted (collectively, the “Company Permits”), and there is no action
pending or, to the knowledge of the Company, threatened regarding suspension or cancellation of any of the Company Permits. Neither
the Company nor its Subsidiary is in conflict with, or in default or violation of, any of the Company Permits, except for any
such conflicts, defaults or violations which, individually or in the aggregate, would not reasonably be expected to have a Material
Adverse Effect. Neither the Company nor its Subsidiary has received any notification with respect to possible conflicts, defaults
or violations of applicable laws, except for notices relating to possible conflicts, defaults or violations, which conflicts,
defaults or violations would not have a Material Adverse Effect.

 

s.Environmental
Matters.

 

(i)There
are, to the Company’s knowledge, with respect to the Company or its Subsidiary or any predecessor of the Company, no past
or present violations of Environmental Laws (as defined below), releases of any material into the environment, actions, activities,
circumstances, conditions, events, incidents, or contractual obligations which may give rise to any common law environmental liability
or any liability under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or similar federal, state,
local or foreign laws and neither the Company nor its Subsidiary has received any notice with respect to any of the foregoing,
nor is any action pending or, to the Company’s knowledge, threatened in connection with any of the foregoing. The term “Environmental
Laws” means all federal, state, local or foreign laws relating to pollution or protection of human health or the environment
(including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata), including, without
limitation, laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants contaminants, or
toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating
to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice
letters, orders, permits, plans or regulations issued, entered, promulgated or approved thereunder.

 

(ii)Other
than those that are or were stored, used or disposed of in compliance with applicable law, no Hazardous Materials are contained
on or about any real property currently owned, leased or used by the Company or its Subsidiary, and no Hazardous Materials were
released on or about any real property previously owned, leased or used by the Company or its Subsidiary during the period the
property was owned, leased or used by the Company or any of its Subsidiary, except in the normal course of the Company’s
or its Subsidiary’ business.

 

    	 	11	 

     

    

 

(iii)There
are no underground storage tanks on or under any real property owned, leased or used by the Company or its Subsidiary that are
not in compliance with applicable law.

 

t.Title
to Property. Except as disclosed in the SEC Documents the Company and its Subsidiary have good and marketable title in fee
simple to all real property and good and marketable title to all personal property owned by them which is material to the business
of the Company and its Subsidiary, in each case free and clear of all liens, encumbrances and defects or such as would not have
a Material Adverse Effect. Any real property and facilities held under lease by the Company and its Subsidiary are held by them
under valid, subsisting and enforceable leases with such exceptions as would not have a Material Adverse Effect.

 

u.Internal
Accounting Controls. Except as disclosed in the SEC Documents the Company and its Subsidiary maintain a system of internal
accounting controls sufficient, in the judgment of the Company’s board of directors, to provide reasonable assurance that
(i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles
and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or
specific authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.

 

v.Foreign
Corrupt Practices. Neither the Company, nor its Subsidiary, nor any director, officer, agent, employee or other person acting
on behalf of the Company or any Subsidiary has, in the course of his actions for, or on behalf of, the Company, used any corporate
funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; made any direct
or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; violated or is in
violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

 

w.Solvency.
The Company (after giving effect to the transactions contemplated by this Agreement) is solvent (i.e., its assets have
a fair market value in excess of the amount required to pay its probable liabilities on its existing debts as they become absolute
and matured) and currently the Company has no information that would lead it to reasonably conclude that the Company would not,
after giving effect to the transaction contemplated by this Agreement, have the ability to, nor does it intend to take any action
that would impair its ability to, pay its debts from time to time incurred in connection therewith as such debts mature.

 

    	 	12	 

     

    

 

x.No
Investment Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement
will not be an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment
Company”). The Company is not controlled by an Investment Company.

 

y.Insurance.
The Company and its Subsidiary are insured by insurers of recognized financial responsibility against such losses and risks and
in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company and its
Subsidiary are engaged. Neither the Company nor the Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not have a Material Adverse Effect. Upon written request the Company will provide
to the Buyer true and correct copies of all policies relating to directors’ and officers’ liability coverage, errors
and omissions coverage, and commercial general liability coverage.

 

z.Breach
of Representations and Warranties by the Company. If the Company breaches any of the representations or warranties set forth
in this Section 3, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered
an Event of default under Section 3.6 of the Note.

 

4.COVENANTS.

 

a.Best
Efforts. The parties shall use their commercially reasonable best efforts to satisfy timely each of the conditions described
in Section 6 and 7 of this Agreement. 

 

b.Use
of Proceeds. The Company shall use the proceeds from the sale of the Note for working capital and other general corporate
purposes and shall not, directly or indirectly, use such proceeds for any loan to or investment in any other corporation, partnership,
enterprise or other person (except for the Subsidiary). 

 

c.Financial
Information. The Company agrees to send or make available the following reports to the Buyer until the Buyer transfers, assigns,
or sells all of the Securities: (i) within ten (10) days after the filing with the SEC, a copy of its Annual Report on Form 10-K
its Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K;; and (ii) contemporaneously with the making available
or giving to the shareholders of the Company, copies of any notices or other information the Company makes available or gives
to such shareholders. For the avoidance of doubt, filing the documents required in (i) above via EDGAR or releasing any documents
set forth in (ii) above via a recognized wire service shall satisfy the delivery requirements of this Section 4(f).

 

    	 	13	 

     

    

 

d.Listing.
The Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange or automated quotation
system, if any, upon which shares of Common Stock are then listed (subject to official notice of issuance) and, so long as the
Buyer owns any of the Securities, shall maintain, so long as any other shares of Common Stock shall be so listed, such listing
of all Conversion Shares from time to time issuable upon conversion of the Note. The Company will obtain and, so long as the Buyer
owns any of the Securities, maintain the listing and trading of its Common Stock on the OTCBB, OTCQB, OTC Pink or any equivalent
replacement exchange, the Nasdaq National Market (“Nasdaq”), the Nasdaq SmallCap Market (“Nasdaq SmallCap”),
the New York Stock Exchange (“NYSE”), or the NYSE MKT and will comply in all respects with the Company’s reporting,
filing and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”) and
such exchanges, as applicable. The Company shall promptly provide to the Buyer copies of any material notices it receives from
the OTCBB, OTCQB and any other exchanges or quotation systems on which the Common Stock is then listed regarding the continued
eligibility of the Common Stock for listing on such exchanges and quotation systems.

 

e.Corporate
Existence. So long as the Buyer beneficially owns the Note, the Company shall maintain its corporate existence and shall not
sell all or substantially all of the Company’s assets, except in the event of a merger or consolidation or sale of all or
substantially all of the Company’s assets, where the surviving or successor entity in such transaction (i) assumes the Company’s
obligations hereunder and under the agreements and instruments entered into in connection herewith and (ii) is a publicly traded
corporation whose Common Stock is listed for trading on the OTCBB, OTCQB, OTC Pink, Nasdaq, NasdaqSmallCap, NYSE or AMEX.

 

f.[RESERVED]

 

g.Failure
to Comply with the 1934 Act. So long as the Buyer beneficially owns the Note, the Company shall comply with the reporting
requirements of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the 1934 Act.

 

h.Trading
Activities. Neither the Buyer nor its affiliates has an open short position (or other hedging or similar transactions) in
the common stock of the Company and the Buyer agree that it shall not, and that it will cause its affiliates not to, engage in
any short sales of or hedging transactions with respect to the common stock of the Company. 

i.Breach
of Covenants. If the Company breaches any of the covenants set forth in this Section 4, and in addition to any other remedies
available to the Buyer pursuant to this Agreement, it will be considered an event of default under Section 3.6 of the Note.

 

    	 	14	 

     

    

 

5.Transfer
Agent Instructions. Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion
Shares may be sold pursuant to Rule 144 without any restriction as to the number of Securities as of a particular date that can
then be immediately sold, all such certificates shall bear the restrictive legend specified in Section 2(g) of this Agreement.
The Company warrants that: (i) no stop transfer instructions to give effect to Section 2(f) hereof (in the case of the Conversion
Shares, prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold
pursuant to Rule 144 without any restriction as to the number of Securities as of a particular date that can then be immediately
sold), will be given by the Company to its transfer agent and that the Securities shall otherwise be freely transferable on the
books and records of the Company as and to the extent provided in this Agreement and the Note; (ii) it will not direct its transfer
agent not to transfer or delay, impair, and/or hinder its transfer agent in transferring (or issuing) (electronically or in certificated
form) any certificate for Conversion Shares to be issued to the Buyer upon conversion of or otherwise pursuant to the Note as
and when required by the Note and this Agreement; and (iii) it will not fail to remove (or directs its transfer agent not to remove
or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer
instructions in respect thereof) on any certificate for any Conversion Shares issued to the Buyer upon conversion of or otherwise
pursuant to the Note as and when required by the Note and this Agreement. Nothing in this Section shall affect in any way the
Buyer’s obligations and agreement set forth in Section 2(g) hereof to comply with all applicable prospectus delivery requirements,
if any, upon re-sale of the Securities. If the Buyer provides the Company, at the cost of the Buyer, with (i) an opinion of counsel
in form, substance and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of
such Securities may be made without registration under the 1933 Act and such sale or transfer is effected or (ii) the Buyer provides
reasonable assurances that the Securities can be sold pursuant to Rule 144, the Company shall permit the transfer, and, in the
case of the Conversion Shares, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend,
in such name and in such denominations as specified by the Buyer. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby.
Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section may be inadequate
and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall
be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer,
without the necessity of showing economic loss and without any bond or other security being required.

 

6.CONDITIONS
PRECEDENT TO THE COMPANY’S OBLIGATIONS TO SELL. The obligation of the Company hereunder to issue and sell the Note to
the Buyer at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions thereto,
provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole
discretion:

 

    	 	15	 

     

    

 

a.The
Buyer shall have executed this Agreement and the Registration Rights Agreement, and delivered the same to the Company.

 

b.The
Buyer shall have delivered the First Tranche Purchase Price in accordance with Section 1(b) above.

 

c.The
representations and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as
of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date),
and the Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date. 

 

d.No
litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having
authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this
Agreement.

 

7.CONDITIONS
PRECEDENT TO THE BUYER’S OBLIGATION TO PURCHASE. The obligation of the Buyer hereunder to purchase the Note at the Closing
is subject to the satisfaction, at or before the Closing Date of each of the following conditions, provided that these conditions
are for the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:

 

a.The
Company shall have executed this Agreement, the Warrant, and the Registration Rights Agreement, and delivered the same to the
Buyer.

 

b.The
Company shall have delivered to the Buyer duly executed Note in accordance with Section 1(b) above.

 

c.The
representations and warranties of the Company shall be true and correct in all material respects as of the date when made and
as of the Closing Date as though made at such time (except for representations and warranties that speak as of a specific date)
and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date. The Buyer
shall have received a certificate or certificates, executed by the chief executive officer of the Company, dated as of the Closing
Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Buyer including, but not limited
to certificates with respect to the Company’s Certificate of Incorporation, By-laws and Board of Directors’ resolutions
relating to the transactions contemplated hereby.

 

    	 	16	 

     

    

 

d.No
litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having
authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this
Agreement.

 

e.No
event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not
limited to a change in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act
reporting obligations.

 

f.The
Common Stock shall have been authorized for quotation on the OTCBB, OTCQB or any similar quotation system and trading in the Common
Stock on the OTCBB, OTCQB or any similar quotation system shall not have been suspended by the SEC or the OTCBB, OTCQB or any
similar quotation system.

 

8.GOVERNING
LAW; MISCELLANEOUS.

 

a.Governing
Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida without regard
to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated
by this Agreement shall be brought only in the state courts of Broward County, Florida or in the federal courts located in the
State of Florida. The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action
instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens.
The Company and Buyer waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable
attorney’s fees and costs. In the event that any provision of this Agreement or any other agreement delivered in connection
herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative
to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other
provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served
in any suit, action or proceeding in connection with this Agreement or any other Transaction Document by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for
notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted
by law.

 

b.Counterparts;
Signatures by Facsimile. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original
but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party. This Agreement, once executed by a party, may be delivered to the other party hereto
by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

 

    	 	17	 

     

    

 

c.Headings.
The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation
of, this Agreement.

 

d.Severability.
In the event that any provision of this Agreement is invalid or unenforceable under any applicable statute or rule of law, then
such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform
with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect
the validity or enforceability of any other provision hereof.

 

e.Entire
Agreement; Amendments. This Agreement and the instruments referenced herein contain the entire understanding of the parties
with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company
nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement
may be waived or amended other than by an instrument in writing signed by the majority in interest of the Buyer.

 

f.Notices.
All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted
by hand delivery, telegram, facsimile, or electronic mail, addressed as set forth below or to such other address as such party
shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder
shall be deemed effective (a) upon hand delivery, delivery by electronic mail, or delivery by facsimile, with accurate confirmation
generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other
than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following
the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing,
whichever shall first occur. The addresses for such communications shall be: 

 

If
to the Company, to:

 

CACHET
FINANCIAL SOLUTIONS, INC.

18671
Lake Drive East, Southwest Tech Center A

Minneapolis,
MN 55317

E-mail:
______________________

Facsimile:
____________________

 

    	 	18	 

     

    

 

If
to the Buyer, to:

 

[INVESTOR
NAME]

[address]

E-mail:
______________________

Facsimile:
____________________

 

Each
party shall provide notice to the other party of any change in address.

 

g.Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns.
Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written
consent of the other. Notwithstanding the foregoing, subject to Section 2(f), the Buyer may assign its rights hereunder to any
person that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term
is defined under the 1934 Act, without the consent of the Company.

 

h.Third
Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors
and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

 

i.Survival.
The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the
closing hereunder. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors, employees and
agents for loss or damage arising as a result of or related to any breach by the Company of any of its representations, warranties
and covenants set forth in this Agreement or any of its covenants and obligations under this Agreement.

 

j.Further
Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request
in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated
hereby.

 

k.No
Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.

 

l.Publicity.
The Company and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC,
OTCQB (or other applicable trading market), or FINRA filings, or any other public statements with respect to the transactions
contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval of the Buyer,
to make any press release or SEC, OTCQB (or other applicable trading market) or FINRA filings with respect to such transactions
as is required by applicable law and regulations (although the Buyer shall be consulted by the Company in connection with any
such press release prior to its release and shall be provided with a copy thereof).

 

m.Registration
Rights. The Company hereby grants the Buyer the registration rights pursuant to the Registration Rights Agreement, in the
form as set forth on Exhibit B hereto, with respect to the Conversion Shares, so long as the Note is outstanding (the “Registration
Rights Agreement”).

 

[
- signature page follows - ]

 

    	 	19	 

     

    

 

IN
WITNESS WHEREOF, the undersigned Buyer and the Company have caused this Agreement to be duly executed as of the date first above
written.

 

	CACHET
    FINANCIAL SOLUTIONS, INC.	 
	 	 	 
	By:
    	/s/
    Jeffrey C. Mack	 
	Name:
    	Jeffrey
    C. Mack	 
	Title:
    	Chief
    Executive Officer	 
	 	 	 
	[INVESTOR
    NAME]	 
	 	 	 
	By:	/s/
    Authorized Signatory	 
	Name:
    	[Authorized
    Signatory]	 
	Title:
    	[Authorized
    Signatory’s Title]	 

 

AGGREGATE
SUBSCRIPTION AMOUNT:

 

	Aggregate
    Principal Amount of Note:	US$450,000.00

 

Aggregate
Purchase Price:

 

Only
$225,000.00 of the $350,000.00 purchase price shall be paid within three (3) business days after the closing of the Note and full
execution of the related transaction documents. All other tranches may be funded in accordance with the terms of the Note.

 

    	 	20	 

     

    

 

EXHIBIT
A

(see
attached)

 

    	 	21	 

     

    

 

EXHIBIT
B

 

REGISTRATION
RIGHTS AGREEMENT

 

This
REGISTRATION RIGHTS AGREEMENT (the “Agreement”), dated as of June 9, 2016 (the “Execution Date”), is entered
into by and between CACHET FINANCIAL SOLUTIONS, INC., a Delaware corporation, with headquarters located at 18671 Lake Drive
East, Southwest Tech Center A, Minneapolis, MN 55317 (the “Company”), and [Investor Name], a [Investor Entity Type],
with its address at [address] (the “Buyer”).

 

RECITALS

 

A.Pursuant
to the securities purchase agreement entered into by and between the Company and the Buyer of this even date herewith (the “Securities
Purchase Agreement”), the Company has agreed to issue and sell to the Buyer, a convertible note in the aggregate principal
amount of US$450,000.00 (the “Note”), which is convertible into an indeterminate number of shares of the Company’s
common stock (the “Common Stock”);

 

B.As
an inducement to the Buyer to execute and deliver the Securities Purchase Agreement, the Company has agreed to provide certain
registration rights under the Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor
statute (collectively, the “1933 Act”), and applicable state securities laws, with respect to the shares of Common
Stock issuable pursuant to the conversion of the Note.

 

C.NOW
THEREFORE, in consideration of the foregoing promises and the mutual covenants contained hereinafter and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Buyer hereby agree as follows:

 

All
capitalized terms used but not defined in this Agreement shall have the meanings ascribed to such terms in the Securities Purchase
Agreement.

 

    	 	22	 

     

    

 

1.Piggy-Back
Registration.

 

1.1Piggy-Back
Rights. If any portion of the Note is not repaid in full by the Company on or before the applicable maturity date, then at
any time on or after the such maturity date, if the Company proposes to file any Registration Statement under the 1933 Act (a
“Registration Statement”) with respect to any offering of equity securities, or securities or other obligations exercisable
or exchangeable for, or convertible into, equity securities, by the Company for its own account or for stockholders of the Company
for their account (or by the Company and by stockholders of the Company), other than a Registration Statement (i) filed in connection
with any employee stock option or other benefit plan, (ii) for a dividend reinvestment plan, (iii) in connection with a merger
or acquisition, or (iv) filed in connection with the Company’s next underwritten public offering after the Execution Date,
then the Company shall (x) give written notice of such proposed filing to the Buyer as soon as practicable but in no event less
than ten (10) days before the anticipated filing date of the Registration Statement, which notice shall describe the amount and
type of securities to be included in such Registration Statement, the intended method(s) of distribution, and the name of the
proposed managing underwriter or underwriters, if any, of the offering, and (y) offer to the Buyer in such notice the opportunity
to register the sale of the Company’s common stock in which the Note is convertible into (the “Registrable Securities”),
as such Buyer may request in writing within five (5) days following receipt of such notice (a “Piggy-Back Registration”).
The Company shall cause such Registrable Securities to be included in such registration and shall cause the managing underwriter
or underwriters of a proposed underwritten offering to permit the Registrable Securities requested to be included in a Piggy-Back
Registration on the same terms and conditions as any similar securities of the Company and to permit the sale or other disposition
of such Registrable Securities in accordance with the intended method(s) of distribution thereof. All holders of Registrable Securities
proposing to distribute their securities through a Piggy-Back Registration that involves an underwriter or underwriters shall
enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such Piggy-Back Registration.

 

1.2Withdrawal.
Any holder of Registrable Securities may elect to withdraw such holder’s request for inclusion of Registrable Securities
in any Piggy-Back Registration by giving written notice to the Company of such request to withdraw prior to the effectiveness
of the Registration Statement. Notwithstanding any such withdrawal, the Company shall pay all expenses incurred by the holders
of Registrable Securities in connection with such Piggy-Back Registration as provided in Section 1.5 below.

 

1.3The
Company shall notify the holders of Registrable Securities at any time when a prospectus relating to such holder’s Registrable
Securities is required to be delivered under the 1933 Act, upon discovery that, or upon the happening of any event as a result
of which, the prospectus included in such Registration Statement, as then in effect, includes an untrue statement of a material
fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading
in light of the circumstances then existing. At the request of such holder, the Company shall also prepare, file and furnish to
such holder a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of the Registrable Securities, such prospectus shall not include an untrue statement of
a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing. The holders of Registrable Securities shall not to offer or sell any Registrable
Securities covered by the Registration Statement after receipt of such notification until the receipt of such supplement or amendment.

 

1.4
The Company may request a holder of Registrable Securities to furnish the Company such information with respect to such holder
and such holder’s proposed distribution of the Registrable Securities pursuant to the Registration Statement as the Company
may from time to time reasonably request in writing or as shall be required by law or by the SEC in connection therewith, and
such holders shall furnish the Company with such information.

 

    	 	23	 

     

    

 

1.5All
fees and expenses incident to the performance of or compliance with this Agreement by the Company shall be borne by the Company
whether or not any Registrable Securities are sold pursuant to a Registration Statement. The fees and expenses referred to in
the foregoing sentence shall include, without limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses of the Company’s counsel and independent registered public accountants) (A) with respect to filings made
with the SEC, (B) with respect to filings required to be made with any trading market on which the Common Stock is then listed
for trading, (C) in compliance with applicable state securities or Blue Sky laws reasonably agreed to by the Company in writing
(including, without limitation, fees and disbursements of counsel for the Company in connection with Blue Sky qualifications or
exemptions of the Registrable Securities) and (D) with respect to any filing that may be required to be made by any broker through
which a holder of Registrable Securities intends to make sales of Registrable Securities with the FINRA, (ii) printing expenses,
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel for the Company, (v) 1933 Act liability
insurance, if the Company so desires such insurance, (vi) fees and expenses of all other persons or entities retained by the Company
in connection with the consummation of the transactions contemplated by this Agreement. In addition, the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation of the transactions contemplated by this Agreement
(including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties),
the expense of any annual audit and the fees and expenses incurred in connection with the listing of the Registrable Securities
on any securities exchange as required hereunder. In no event shall the Company be responsible for any broker or similar commissions
of any holder of Registrable Securities.

 

1.6The
Company and its successors and assigns shall indemnify and hold harmless the Buyer, each holder of Registrable Securities, the
officers, directors, members, partners, agents and employees (and any other individuals or entities with a functionally equivalent
role of a person holding such titles, notwithstanding a lack of such title or any other title) of each of them, each individual
or entity who controls each Buyer or any such holder of Registrable Securities (within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act) and the officers, directors, members, stockholders, partners, agents and employees (and any other
individuals or entities with a functionally equivalent role of a person holding such titles, notwithstanding a lack of such title
or any other title) of each such controlling individual or entity (each, an “Indemnified Party”), to the fullest extent
permitted by applicable law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation,
reasonable attorneys’ fees) and expenses (collectively, “Losses”), as incurred, arising out of or relating
to (1) any untrue or alleged untrue statement of a material fact contained in a Registration Statement, any related prospectus
or any form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating
to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein
(in the case of any such prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading
or (2) any violation or alleged violation by the Company of the 1933 Act, the 1934 Act or any state securities law, or any rule
or regulation thereunder, in connection with the performance of its obligations under this Exhibit B, except to the extent, but
only to the extent, that (i) such untrue statements or omissions are based upon information regarding each Buyer or such holder
of Registrable Securities furnished to the Company by such party for use therein. The Company shall notify each Buyer and each
holder of Registrable Securities promptly of the institution, threat or assertion of any proceeding arising from or in connection
with the transactions contemplated by this Agreement of which the Company is aware.

 

    	 	24	 

     

    

 

1.7If
the indemnification under Section 1.6 is unavailable to an Indemnified Party or insufficient to hold an Indemnified Party harmless
for any Losses, then the Company shall contribute to the amount paid or payable by such Indemnified Party, in such proportion
as is appropriate to reflect the relative fault of the Company and Indemnified Party in connection with the actions, statements
or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of the Company
and Indemnified Party shall be determined by reference to, among other things, whether any action in question, including any untrue
or alleged untrue statement of a material fact or omission or alleged omission of a material fact, has been taken or made by,
or relates to information supplied by, the Company or the Indemnified Party, and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such action, statement or omission. The amount paid or payable by
a party as a result of any Losses shall be deemed to include any reasonable attorneys’ or other fees or expenses incurred
by such party in connection with any proceeding to the extent such party would have been indemnified for such fees or expenses
if the indemnification provided for in Section 1.6 was available to such party in accordance with its terms. It is agreed that
it would not be just and equitable if contribution pursuant to this Section 1.7 were determined by pro rata allocation or by any
other method of allocation that does not take into account the equitable considerations referred to in the immediately preceding
sentence. Notwithstanding the provisions of this Section 1.7, neither each Buyer nor any holder of Registrable Securities shall
be required to contribute, in the aggregate, any amount in excess of the amount by which the net proceeds actually received by
such party from the sale of all of their Registrable Securities pursuant to such Registration Statement or related prospectus
exceeds the amount of any damages that such party has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.

 

(Signature
page immediately follows)

 

    	 	25	 

     

    

 

IN
WITNESS WHEREOF, the parties have caused this Agreement to be duly executed by their respective authorized representatives
as of the Execution Date.

 

	CACHET
    FINANCIAL SOLUTIONS, INC.	 
	 	 	 
	By:
    	/s/
    Jeffrey C. Mack	 
	Name:
    	Jeffrey
    C. Mack	 
	Title:
    	Chief
    Executive Officer	 
	 	 	 
	[INVESTOR
    NAME]	 
	 	 	 
	By:
    	/s/
    Authorized Signatory	 
	Name:
    	[Authorized Signatory]	 
	Title:
    	[Authorized
    Signatory’s Title]	 

 

    	 	26	 

     

    

 

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

 

Original
Issue Date: June 9, 2016

Principal
Amount: $450,000.00

 

CONVERTIBLE
PROMISSORY NOTE

 

THIS
CONVERTIBLE PROMISSORY NOTE is a duly authorized and validly issued convertible note of Cachet Financial Solutions, Inc., a Delaware
corporation, (the “Company”), having its principal place of business at 18671 Lake Drive East, Southwest Tech
Center A, Minneapolis, MN 55317 (the “Note”).

 

FOR
VALUE RECEIVED, the Company promises to pay to [Investor Name], or its registered assigns (the “Holder”),
or shall have paid pursuant to the terms hereunder, the principal sum of $450,000.00 (the “Principal Amount”)
on the Maturity Date (as defined herein) or such earlier date as this Note is required or permitted to be repaid as provided hereunder,
and to pay interest to the Holder on the aggregate unconverted and then outstanding principal amount of this Note in accordance
with the provisions hereof. The aggregate consideration to the Company from the Holder for this Note is up to $350,000.00 (the
“Consideration”) in United States currency, due to an original issuance discount of $75,000.00 (the “OID”)
and a deduction of $25,000.00 for Holder’s legal fees (the “Legal Fee”). The Holder shall pay $225,000.00
of the Consideration (the “First Tranche”) within three (3) business days after the issuance of this Note and
full execution of the related transaction documents (the “Transaction Documents”). At the closing of the First
Tranche, the outstanding principal amount under this Note shall be $300,000.00, which includes the principal amount of the First
Tranche, the prorated amount of $50,000.00 of the OID, and the Legal Fee. Upon mutual consent of the Company and Holder, and at
any time after the Original Issue Date, the Holder may fund the remaining $125,000.00 of the Consideration to the Company (which
will increase the outstanding principal balance of the Note by $150,000.00 due to the prorated amount of $25,000.00 of the OID).
THE PRINCIPAL SUM DUE TO THE HOLDER SHALL BE PRORATED BASED ON THE CONSIDERATION ACTUALLY PAID BY THE HOLDER, AS WELL AS THE
APPLICABLE INTEREST, SUCH THAT THE ISSUER IS ONLY REQUIRED TO REPAY THE AMOUNT FUNDED (PLUS THE OID, LEGAL FEE, APPLICABLE INTEREST,
AND ALL OTHER APPLICABLE FEES AS PROVIDED HEREIN) AND THE ISSUER IS NOT REQUIRED TO REPAY ANY UNFUNDED PORTION OF THIS NOTE. The
maturity date for each tranche funded shall be six (6) months from the effective date of each payment (each a “Maturity
Date”), and is the date upon which the principal sum of the respective tranche, as well as any accrued and unpaid interest
and other fees relating to that respective tranche, shall be due and payable. This Note is also subject to the following
additional provisions:

 

    	 

    	 

    

 

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

 

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

 

“Alternate
Conversion Price” shall mean 60% of the lowest VWAP of the Common Stock for the 21 consecutive Trading Days immediately
preceding the applicable Conversion Date.

 

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

 

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

 

    	 

    	 

    

 

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

 

“Change
of Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date hereof
by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act)
of effective control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise)
of in excess of 50% of the voting securities of the Company (other than by means of conversion or exercise of the Note and the
Securities issued together with the Note), (b) the Company merges into or consolidates with any other Person, or any Person merges
into or consolidates with the Company and, after giving effect to such transaction, the stockholders of the Company immediately
prior to such transaction own less than 50% of the aggregate voting power of the Company or the successor entity of such transaction,
(c) the Company sells or transfers all or substantially all of its assets to another Person and the stockholders of the Company
immediately prior to such transaction own less than 50% of the aggregate voting power of the acquiring entity immediately after
the transaction, (d) a replacement at one time or within a three year period of more than one-half of the members of the Board
of Directors which is not approved by a majority of those individuals who are members of the Board of Directors on the Original
Issue Date (or by those individuals who are serving as members of the Board of Directors on any date whose nomination to the Board
of Directors was approved by a majority of the members of the Board of Directors who are members on the date hereof), or (e) the
execution by the Company of an agreement to which the Company is a party or by which it is bound, providing for any of the events
set forth in clauses (a) through (d) above.

 

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

 

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

 

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

 

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

 

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

 

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

 

“DTC”
means the Depository Trust Company.

 

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

 

    	 

    	 

    

 

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

 

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

 

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

 

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

 

“Mandatory
Default Amount” means the payment of 120% multiplied by the total amount outstanding under the Note at the time of calculation,
in addition to the payment of all other amounts, costs, expenses and liquidated damages due in respect of this Note.

 

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

 

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

 

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

 

“Purchase
Agreement” means the Securities Purchase Agreement, dated as of June 9, 2016 among the Company and the original Holder,
as amended, modified or supplemented from time to time in accordance with its terms.

 

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

 

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

 

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

 

“Trading
Days” means any day on which the Common Stock is tradable for any period on the OTCQB, or on the principal securities
exchange or other securities market on which the Common Stock is then being traded. 

 

Section
2. Interest and Repayment.

 

a)
No Payment of Interest in Cash or Kind. Except as otherwise provided herein, the Company shall pay no interest to the Holder
on the aggregate unconverted and then outstanding principal amount of this Note.

 

    	 

    	 

    

 

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

 

c)
Payment and Redemption. Upon three (3) days written notice to the Holder (each, a “Repayment Period”), the
Company may repay the total outstanding amount under this Note as provided herein. If the Company exercises its right to repay
the Note, the Company shall make payment to the Holder of an amount in cash equal to the sum of the then outstanding principal
amount and interest of this Note multiplied by 120% (the “Repayment Amount”). Holder cannot convert the Note
during each Repayment Period unless an Event of Default has occurred hereunder and at least six months and 3 days have elapsed
since the Original Issue Date. Upon the occurrence of an Event of Default, which is not cured within the three (3) calendar days
as provided in that section, the Holder shall have the right to require the Company to make payment to the Holder of an amount
in cash equal to the Mandatory Default Amount.

 

Section
3. Registration of Transfers and Exchanges.

 

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

 

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

 

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

 

    	 

    	 

    

 

Section
4. Conversion.

 

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

 

Conversion
Price. The conversion price in effect on any Conversion Date (assuming that a conversion is permitted pursuant to Section
4(a) of this Note) shall be equal to the Alternate Conversion Price.

 

b)
Mechanics of Conversion.

 

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

 

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

 

    	 

    	 

    

 

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

 

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

 

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

 

    	 

    	 

    

 

iv.
Obligation Absolute; Partial Liquidated Damages. The Company’s obligations to issue and deliver the Conversion Shares
upon conversion of this Note in accordance with the terms hereof are absolute and unconditional, irrespective of any action or
inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment
against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any
breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation
of law by the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation
of the Company to the Holder in connection with the issuance of such Conversion Shares; provided, however, that
such delivery shall not operate as a waiver by the Company of any such action the Company may have against the Holder. If the
Company fails for any reason to deliver to the Holder such certificate or certificates pursuant to Section 4(c)(ii) by the Share
Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, $3,000 per Trading Day
for each Trading Day after such Share Delivery Date until such certificates are delivered or Holder rescinds such conversion.
Nothing herein shall limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to Section
6 hereof for the Company’s failure to deliver Conversion Shares within the period specified herein and the Holder shall
have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce
damages pursuant to any other Section hereof or under applicable law.

 

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

 

    	 

    	 

    

 

vi.
Reservation of Shares Issuable Upon Conversion. The Company covenants that it will at all times reserve and keep available
out of its authorized and unissued shares of Common Stock a number of shares of Common Stock at least equal to 300% of the total
amount of Common Stock that this Note would be convertible into based upon the Alternative Conversion Price, in full and irrespective
of beneficial ownership limitations, at any time, for the sole purpose of issuance upon conversion of this Note and payment of
interest on this Note, each as herein provided, free from preemptive rights or any other actual contingent purchase rights of
Persons other than the Holder (and the other holders of the Note), not less than such aggregate number of shares of the Common
Stock as shall (subject to the terms and conditions set forth in the Purchase Agreement) be issuable (taking into account the
adjustments and restrictions of Section 5) upon the conversion of the then outstanding principal amount of this Note and payment
of interest hereunder. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly
authorized, validly issued, fully paid and nonassessable.

 

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

 

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

 

    	 

    	 

    

 

c)
Holder’s Conversion Limitations. The Holder shall not have the right to convert any principal and/or interest of
this Note, to the extent that after giving effect to the conversion set forth on the applicable Notice of Conversion, the Holder
(together with the Holder’s Affiliates, and any Persons acting as a group together with the Holder or any of the Holder’s
Affiliates) would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing
sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the number of
shares of Common Stock issuable upon conversion of this Note with respect to which such determination is being made, but shall
exclude the number of shares of Common Stock which are issuable upon (i) conversion of the remaining, unconverted principal amount
of this Note beneficially owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the unexercised or unconverted
portion of any other securities of the Company subject to a limitation on conversion or exercise analogous to the limitation contained
herein (including, without limitation, any other promissory notes or the warrants as further defined in the securities purchase
agreement dated June 9, 2016) beneficially owned by the Holder or any of its Affiliates. Except as set forth in the preceding
sentence, for purposes of this Section 4(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder. To the extent that the limitation contained in this Section
4(d) applies, the determination of whether this Note is convertible (in relation to other securities owned by the Holder together
with any Affiliates) and of which principal amount of this Note is convertible shall be in the sole discretion of the Holder,
and the submission of a Notice of Conversion shall be deemed to be the Holder’s determination of whether this Note may be
converted (in relation to other securities owned by the Holder together with any Affiliates) and which principal amount of this
Note is convertible, in each case subject to the Beneficial Ownership Limitation. To ensure compliance with this restriction,
the Holder will be deemed to represent to the Company each time it delivers a Notice of Conversion that such Notice of Conversion
has not violated the restrictions set forth in this paragraph and the Company shall have no obligation to verify or confirm the
accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined
in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this
Section 4(e), in determining the number of outstanding shares of Common Stock, the Holder may rely on the number of outstanding
shares of Common Stock as stated in the most recent of the following: (i) the Company’s most recent periodic or annual report
filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company, or (iii) a more recent written
notice by the Company or the Company’s transfer agent setting forth the number of shares of Common Stock outstanding. Upon
the written or oral request of a Holder, the Company shall within two Trading Days confirm orally and in writing to the Holder
the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be
determined after giving effect to the conversion or exercise of securities of the Company, including this Note, by the Holder
or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The “Beneficial
Ownership Limitation” shall be 4.99% of the number of shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon conversion of this Note held by the Holder. The Holder, upon not
less than 61 days’ prior notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions
of this Section 4(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the
Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon conversion of this Note
held by the Holder and the Beneficial Ownership Limitation provisions of this Section 4(e) shall continue to apply. Any such increase
or decrease will not be effective until the 61st day after such notice is delivered to the Company. The Beneficial
Ownership Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity
with the terms of this Section 4(d) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with
the intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary or desirable to properly
give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Note.

 

    	 

    	 

    

 

d)
If, during the period that the Note is outstanding and prior to the full satisfaction of the Note (through repayment or conversion),
the Company enters into a subsequent convertible debt financing (including but not limited to transactions that include equity
incentives) with any third party on terms that, taken as a whole, are more favorable in the aggregate to the third party than
to the Holder’s terms under this Note, taken as a whole, then the Company and the Holder shall discuss in good faith and
agree upon a fair and equitable adjustment to the terms of the Note and shall amend the relevant agreements accordingly, to ensure
that the terms of the third party financing, taken as a whole, shall no longer be more favorable in the aggregate to such respective
third party than the Holder’s terms under this Note, taken as a whole. No such adjustment shall be required if the Company
prepays the Note entirely at the time of closing of such more favorable third party financing, or with the proceeds thereof.

 

Section
5. Certain Adjustments.

 

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

 

    	 

    	 

    

 

b)
Intentionally Omitted.

 

c)
Intentionally Omitted.

 

d)
Intentionally Omitted.

 

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

 

    	 

    	 

    

 

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

 

g)
Notice to the Holder.

 

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

 

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

 

Section
6. Events of Default.

 

a)
“Event of Default” means, wherever used herein, any of the following events (whatever the reason for such event
and whether such event shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or
order of any court, or any order, rule or regulation of any administrative or governmental body), if such event is not cured within
three (3) calendar days (the three (3) calendar day cure period does not apply to a failure to deliver shares):

 

    	 

    	 

    

 

i.
any default in the payment of (A) the principal amount of the Note or (B) interest, liquidated damages and other amounts owing
to a Holder on this Note, as and when the same shall become due and payable (whether on a Conversion Date or the respective Maturity
Date or by acceleration or otherwise);

 

ii.
the Company shall materially fail to observe or perform any other covenant or agreement in, or a default or event of default (subject
to any grace or cure period) shall occur in, the Note or in any of Transaction Documents the (other than a breach by the Company
of its obligations to deliver shares of Common Stock to the Holder upon conversion, which breach is addressed in clause (vii)
below);

 

iii.
any representation or warranty made in this Note or any other Transaction Documents shall be untrue or incorrect in any material
respect as of the date when made or deemed made;

 

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

 

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

 

vi.
the Company shall be a party to any Change of Control Transaction or Fundamental Transaction;

 

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

 

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

 

ix.
the occurrence of any levy upon or seizure or attachment of, or any uninsured loss of or damage to, any property of the Company
or any Subsidiary having an aggregate fair value or repair cost (as the case may be) in excess of $750,000 individually or in
the aggregate, and any such levy, seizure or attachment shall not be set aside, bonded or discharged within thirty (30) days after
the date thereof;

 

    	 

    	 

    

 

x.
the Company shall fail to maintain sufficient reserved shares pursuant to Section 4.10 of the Purchase Agreement, upon request
of the Holder;

 

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

 

xii.
the Company’s failure to terminate its equity line of credit with Lincoln Park Capital Fund, LLC within 30 days of the Original
Issue Date;

 

xiii.
the Company provides written notice to Holder of its intention to repay the Note pursuant to the terms of the Note, but fails
to do so at the conclusion of the applicable Repayment Period; or

 

xiv.
the Company fails to repay the Note pursuant to the terms of the Note with funds received from its next underwritten offering
of $5,000,000.00 or more which is consummated on or after the Original Issue Date.

 

b)
Remedies Upon Event of Default. Subject to the Beneficial Ownership Limitation as set forth in Section 4(d), if any Event
of Default occurs, then the outstanding principal amount of this Note, plus accrued but unpaid interest, liquidated damages and
other amounts owing in respect thereof through the date of acceleration, shall become, at the Holder’s election, immediately
due and payable in cash at the Mandatory Default Amount. After the occurrence of any Event of Default that results in the eventual
acceleration of this Note, the interest rate on this Note shall accrue at an additional interest rate equal to the lesser of 24%
per annum or the maximum rate permitted under applicable law. Upon the payment in full of the Mandatory Default Amount, the Holder
shall promptly surrender this Note to or as directed by the Company. Such acceleration may be rescinded and annulled by Holder
at any time prior to payment hereunder and the Holder shall have all rights as a holder of the Note until such time, if any, as
the Holder receives full payment pursuant to this Section 6(b). No such rescission or annulment shall affect any subsequent Event
of Default or impair any right consequent thereon.

 

    	 

    	 

    

 

Section
7. Miscellaneous.

 

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

 

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

 

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

 

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

 

    	 

    	 

    

 

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

 

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

 

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

 

    	 

    	 

    

 

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

 

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

 

j)
Issuance of Convertible Securities. Commencing from the issuance of the Note until the earlier of repayment or conversion
of the entire Note, the Company shall not, directly or indirectly, without Holder’s prior written consent, issue any securities
that are convertible or exercisable into common stock of the Company at a conversion price or exercise price that is variable,
and not subject to a floor price, unless the Company prepays the Note entirely at the time of issuance of such convertible or
exercisable securities, or with the proceeds thereof. For avoidance of doubt, the foregoing shall not restrict the Company from:
(i) taking any loans or issuing any debt or equity securities that are either (A) not convertible or exercisable into common stock
of the Company or (B) are convertible or exercisable into common stock of the Company at a conversion price that is fixed at the
time of issuance of such loan or convertible or exercisable securities, subject to anti-dilution adjustments; or (ii) issuing
any warrants that are exercisable into common stock of the Company at a conversion price that is fixed at the time of issuance
of such warrants, subject to anti-dilution adjustments. A variable conversion price that is subject to a floor price shall be
considered a fixed conversion price for the purposes of this paragraph.

 

Section
8. Registration Rights.

 

a)
The Company hereby grants the Buyer the registration
rights set forth on Exhibit A of the securities purchase agreement entered into between the Company and Holder on or around the
Original Issue Date, with respect to the shares of Common Stock in which the Note is convertible into, in the event that all amounts
owed under the Note are not repaid in full on each respective Maturity Date.

 

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

 

(Signature
Pages Follow)

 

    	 

    	 

    

 

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

 

 

	 	Cachet
    Financial Solutions, Inc.
	 	 	 
	 	By:	/s/
    Jeffrey C. Mack
	 	Name:	Jeffrey
    C. Mack
	 	Title:	Chief
    Executive Officer

 

    	 

    	 

    

 

ANNEX
A

 

NOTICE
OF CONVERSION

 

The
undersigned hereby elects to convert principal under the convertible promissory note dated June 9, 2016 issued by Cachet Financial
Solutions, Inc., a Delaware corporation (the “Company”), into shares of common stock (the “Common
Stock”), of the Company according to the conditions hereof, as of the date written below. If shares of Common Stock
are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with
respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance
therewith. No fee will be charged to the holder for any conversion, except for such transfer taxes, if any.

 

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

 

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

 

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

 

    	 

    	 

    

 

Schedule
1

 

CONVERSION
SCHEDULE

 

This
convertible promissory note with an original issue date of June 9, 2016 in the original principal amount of $450,000.00 is issued
by Cachet Financial Solutions, Inc., a Delaware corporation. This Conversion Schedule reflects conversions made under Section
4 of the above referenced Note.

 

Dated:

 

	Date of Conversion 

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

    Amount Remaining 
 Subsequent to 
 Conversion (or original 
 Principal Amount)	Company Attest
		 

                                               

                                               
	 

                                               
	
	 

                                                                                 

                                                                                 
	 	 	 
	 

                                                                                 

                                                                                 
	 	 	 
	 

                                                                                 

                                                                                 
	 	 	 
	 

                                                                                 

                                                                                 
	 	 	 
	 

                                                                                 

                                                                                 
	 	 	 
	 

                                                                                 

                                                                                 
	 	 	 
	 

                                                                                 

                                                                                 
	 	 	 
	 

                                                                                 

                                                                                 
	 	 	 

 

 

  

    	 

    	 

    

 

NEITHER
THE OFFER AND SALE OF THIS SECURITY NOR THE SECURITIES AS TO WHICH THIS SECURITY MAY BE EXERCISED HAVE BEEN REGISTERED WITH THE
UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY
A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

COMMON
STOCK PURCHASE WARRANT

 

CACHET
FINANCIAL SOLUTIONS, INC.

 

Warrant
Shares: 1,125,000

Date
of Issuance: June 9, 2016 (“Issuance Date”)

 

This
COMMON STOCK PURCHASE WARRANT (the “Warrant”) certifies that, for value received (in connection with the $450,000.00
convertible promissory note issued to the Holder (as defined below) of even date herewith) (the “Note”), [Investor
Name] (including any permitted and registered assigns, the “Holder”), is entitled, upon the terms and subject
to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date of issuance hereof,
to purchase from Cachet Financial Solutions, Inc., a Delaware corporation (the “Company”), up to 1,125,000
shares of Common Stock (as defined below) (the “Warrant Shares”) (subject to adjustment for forward or reverse
stock splits) (of which 750,000 shall be deemed issued as of the funding date of the First Tranche (as defined in the Note), and
375,000 shall be deemed issued as of the funding date of the remaining $125,000.00 of the Consideration (as defined in the Note)
under the Note) at the Exercise Price per share then in effect. This Warrant is issued by the Company as of the Issuance Date
in connection with that certain securities purchase agreement dated June 9, 2016, by and between the Company and the Holder (the
“Purchase Agreement”).

 

Capitalized
terms used in this Warrant shall have the meanings set forth in the Purchase Agreement unless otherwise defined in the body of
this Warrant or in Section 13 below. For purposes of this Warrant, the term “Exercise Price” shall mean $0.40,
subject to adjustment for forward or reverse stock splits and as provided herein (including but not limited to cashless exercise),
and the term “Exercise Period” shall mean the period commencing on the Issuance Date and ending on 5:00 p.m.
eastern standard time on the five-year anniversary thereof.

 

    			 

    	 	 	 

    

 

1.EXERCISE
OF WARRANT.

 

(a)Mechanics
of Exercise. Subject to the terms and conditions hereof, the rights represented by this Warrant may be exercised in whole
or in part at any time or times during the Exercise Period by delivery of a written notice, in the form attached hereto as Exhibit
A (the “Exercise Notice”), of the Holder’s election to exercise this Warrant. The Holder shall not
be required to deliver the original Warrant in order to effect an exercise hereunder. Partial exercises of this Warrant resulting
in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding
number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. On or
before the third Trading Day (the “Warrant Share Delivery Date”) following the date on which the Company shall
have received the Exercise Notice, and upon receipt by the Company of payment to the Company of an amount equal to the applicable
Exercise Price multiplied by the number of Warrant Shares as to which all or a portion of this Warrant is being exercised (the
“Aggregate Exercise Price” and together with the Exercise Notice, the “Exercise Delivery Documents”)
in cash or by wire transfer of immediately available funds (or by cashless exercise, in which case there shall be no Aggregate
Exercise Price provided), the Company shall (or direct its transfer agent to) issue and dispatch by overnight courier to the address
as specified in the Exercise Notice, a certificate, registered in the Company’s share register in the name of the Holder
or its designee, for the number of shares of Common Stock to which the Holder is entitled pursuant to such exercise. Upon delivery
of the Exercise Delivery Documents, the Holder shall be deemed for all corporate purposes to have become the holder of record
of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the certificates
evidencing such Warrant Shares. If this Warrant is submitted in connection with any exercise and the number of Warrant Shares
represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise,
then the Company shall as soon as practicable and in no event later than three Business Days after any exercise and at its own
expense, issue a new Warrant (in accordance with Section 6) representing the right to purchase the number of Warrant Shares purchasable
immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect to which this Warrant is
exercised.

 

If
the Company fails to cause its transfer agent to transmit to the Holder the respective shares of Common Stock by the respective
Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise in Holder’s sole discretion, and
such failure shall be deemed an event of default under the Note.

 

If
the Market Price of one share of Common Stock is greater than the Exercise Price, the Holder may elect to receive Warrant Shares
pursuant to a cashless exercise, in lieu of a cash exercise, equal to the value of this Warrant determined in the manner described
below (or of any portion thereof remaining unexercised) by surrender of this Warrant and a Notice of Exercise, in which event
the Company shall issue to Holder a number of Common Stock computed using the following formula:

 

X
= Y (A-B)

A

 

	 	Where	X
    =	the
    number of Shares to be issued to Holder.
	 	 	 	 
	 	 	Y
    =	the
    number of Warrant Shares that the Holder elects to purchase under this Warrant (at the date of such calculation).
	 	 	 	 
	 	 	A
    =	the
    Market Price (at the date of such calculation).
	 	 	 	 
	 	 	B
    =	Exercise
    Price (as adjusted to the date of such calculation).

 

(b)No
Fractional Shares. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment
pursuant hereto. All Warrant Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes
of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise
would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder
otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then-current Market Price
of a Warrant Share by such fraction.

 

    	 	2	 

    	 	 	 

    

 

(c)Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to
exercise any portion of this Warrant, to the extent that after giving effect to issuance of Warrant Shares upon exercise as set
forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other persons acting
as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the Beneficial
Ownership Limitation, as defined below. For purposes of the foregoing sentence, the number of shares of Common Stock beneficially
owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant
with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be
issuable upon (i) exercise of the remaining, non-exercised portion of this Warrant beneficially owned by the Holder or any of
its Affiliates and (ii) exercise or conversion of the unexercised or non-converted portion of any other securities of the Company
(including without limitation any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous
to the limitation contained herein beneficially owned by the Holder or any of its Affiliates. Except as set forth in the preceding
sentence, for purposes of this paragraph (d), beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is
in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed
in accordance therewith. To the extent that the limitation contained in this paragraph applies, the determination of whether this
Warrant is exercisable (in relation to other securities owned by the Holder together with any affiliates) and of which portion
of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall
be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned
by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial
Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination.

 

For
purposes of this paragraph, in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of
outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the
Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the
Company or its transfer agent setting forth the number of shares of Common Stock outstanding. Upon the request of a Holder, the
Company shall within two Trading Days confirm to the Holder the number of shares of Common Stock then outstanding. In any case,
the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities
of the Company, including this Warrant, by the Holder or its affiliates since the date as of which such number of outstanding
shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 4.99% of the number of
shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon
exercise of this Warrant. Upon no fewer than 61 days’ prior notice to the Company, a Holder may increase or decrease the
Beneficial Ownership Limitation provisions of this paragraph, provided that the Beneficial Ownership Limitation in no event exceeds
9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common
Stock upon exercise of this Warrant held by the Holder and the provisions of this paragraph shall continue to apply. Any such
increase or decrease will not be effective until the 61st day after such notice is delivered to the Company and shall only apply
to such Holder and no other Holder. The limitations contained in this paragraph shall apply to a successor Holder of this Warrant.

 

    	 	3	 

    	 	 	 

    

 

2.ADJUSTMENTS.
The Exercise Price and the number of Warrant Shares shall be adjusted from time to time as follows:

 

(a)Distribution
of Assets. If the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its
assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including without limitation any distribution
of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement
or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in
each such case:

 

(i)any
Exercise Price in effect immediately prior to the close of business on the record date fixed for the determination of holders
of shares of Common Stock entitled to receive the Distribution shall be reduced, effective as of the close of business on such
record date, to a price determined by multiplying such Exercise Price by a fraction (i) the numerator of which shall be the Closing
Sale Price of the shares of Common Stock on the Trading Day immediately preceding such record date minus the value of the Distribution
(as determined in good faith by the Company’s Board of Directors) applicable to one share of Common Stock, and (ii) the
denominator of which shall be the Closing Sale Price of the shares of Common Stock on the Trading Day immediately preceding such
record date; and

 

(ii)the
number of Warrant Shares shall be increased to a number of shares equal to the number of shares of Common Stock obtainable immediately
prior to the close of business on the record date fixed for the determination of holders of shares of Common Stock entitled to
receive the Distribution multiplied by the reciprocal of the fraction set forth in the immediately preceding clause (i); provided,
however, that in the event that the Distribution is of shares of common stock of a company (other than the Company) whose common
stock is traded on a national securities exchange or a national automated quotation system (“Other Shares of Common Stock”),
then the Holder may elect to receive a warrant to purchase Other Shares of Common Stock in lieu of an increase in the number of
Warrant Shares, the terms of which shall be identical to those of this Warrant, except that such warrant shall be exercisable
into the number of shares of Other Shares of Common Stock that would have been payable to the Holder pursuant to the Distribution
had the Holder exercised this Warrant immediately prior to such record date and with an aggregate exercise price equal to the
product of the amount by which the exercise price of this Warrant was decreased with respect to the Distribution pursuant to the
terms of the immediately preceding clause (i) and the number of Warrant Shares calculated in accordance with the first part of
this clause (ii).

 

(b)
Anti-Dilution Adjustments to Exercise Price. Except in the case of any shares of Common Stock or Common Stock Equivalents
issued or issuable in connection with any Exempt Issuance, if the Company, at any time from and after the Issuance Date, shall
issue any Common Stock or Common Stock Equivalents entitling any person, firm, association or entity to acquire shares of Common
Stock at an effective price per share less than the then-current Exercise Price, as adjusted hereunder (any such issuance being
referred to as a “Dilutive Issuance”), then the Exercise Price shall be adjusted to match the lowest price
per share at which such Common Stock was issued or may be acquired pursuant to such Common Stock Equivalents in the Dilutive Issuance.
This clause (b) shall be of no further force and effect following the closing of the Company’s next underwritten public
offering resulting in gross proceeds of at least $5,000,000, and this Warrant shall thereafter be exercisable at the original
Exercise Price (subject to adjustment as provided in this Warrant except for the anti-dilution adjustment in this clause (b)).

 

(c)Subdivision
or Combination of Common Stock.If the Company at any time on or after the Issuance Date subdivides (by any stock split,
stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into a greater number
of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of
Warrant Shares will be proportionately increased. If the Company at any time on or after the Issuance Date combines (by combination,
reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller number of shares,
the Exercise Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant
Shares will be proportionately decreased. Any adjustment under this Section shall become effective at the closing of business
on the date the subdivision or combination becomes effective.

 

    	 	4	 

    	 	 	 

    

 

3.FUNDAMENTAL
TRANSACTIONS. If, at any time while this Warrant is outstanding, (i) the Company effects any merger of the Company with or
into another entity and the Company is not the surviving entity (such surviving entity, the “Successor Entity”),
(ii) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii)
any tender offer or exchange offer (whether by the Company or by another individual or entity, and approved by the Company) is
completed pursuant to which holders of Common Stock are permitted to tender or exchange their shares of Common Stock for other
securities, cash or property and the holders of at least 50% of the Common Stock accept such offer, or (iv) the Company effects
any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property (other than as a result of a subdivision or combination of shares of
Common Stock) (in any such case, a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant,
the Holder shall have the right to receive the number of shares of Common Stock of the Successor Entity or of the Company and
any additional consideration (the “Alternate Consideration”) receivable upon or as a result of such reorganization,
reclassification, merger, consolidation or disposition of assets by a holder of the number of shares of Common Stock for which
this Warrant is exercisable immediately prior to such event (disregarding any limitation on exercise contained herein solely for
the purpose of such determination). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share
of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration
in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of
Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the
Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following
such Fundamental Transaction. To the extent necessary to effectuate the foregoing provisions, any Successor Entity in such Fundamental
Transaction shall issue to the Holder a new warrant consistent with the foregoing provisions and evidencing the Holder’s
right to exercise such warrant into Alternate Consideration.

 

4.NON-CIRCUMVENTION.
The Company covenants and agrees that it will not, by amendment of its certificate of incorporation, bylaws or through any reorganization,
transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, and will at all times in good
faith carry out all the provisions of this Warrant and take all action as may be required to protect the rights of the Holder.
Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares of Common Stock
receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions as may
be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of Common
Stock upon the exercise of this Warrant, and (iii) shall, for so long as this Warrant is outstanding, have authorized and reserved,
free from preemptive rights, a sufficient number of shares of Common Stock to provide for the exercise of the rights represented
by this Warrant (without regard to any limitations on exercise).

 

5.WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, this Warrant, in and of itself, shall not
entitle the Holder to any voting rights or other rights as a stockholder of the Company. In addition, nothing contained in this
Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant
or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the
Company.

 

6.REISSUANCE.

 

(a)Lost,
Stolen or Mutilated Warrant. If this Warrant is lost, stolen, mutilated or destroyed, the Company will, on such terms as to
indemnity or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof),
issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed.

 

    	 	5	 

    	 	 	 

    

 

(b)Issuance
of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such new Warrant
shall be of like tenor with this Warrant, and shall have an issuance date, as indicated on the face of such new Warrant which
is the same as the Issuance Date.

 

7.TRANSFER.

 

(a)Notice
of Transfer. The Holder agrees to give written notice to the Company before transferring this Warrant or transferring any
Warrant Shares of such Holder’s intention to do so, describing briefly the manner of any proposed transfer. Promptly upon
receiving such written notice, the Company shall present copies thereof to the Company’s counsel. If the proposed transfer
may be effected without registration or qualification (under any federal or state securities laws), the Company, as promptly as
practicable, shall notify the Holder thereof, whereupon the Holder shall be entitled to transfer this Warrant or to dispose of
Warrant Shares received upon the previous exercise of this Warrant, all in accordance with the terms of the notice delivered by
the Holder to the Company; provided, however, that an appropriate legend may be endorsed on this Warrant or the certificates for
such Warrant Shares respecting restrictions upon transfer thereof necessary or advisable in the opinion of counsel and satisfactory
to the Company to prevent further transfers which would be in violation of Section 5 of the Securities Act and applicable state
securities laws; and provided further that the prospective transferee or purchaser shall execute the Assignment of Warrant attached
hereto as Exhibit B and such other documents and make such representations, warranties, and agreements as may be required
solely to comply with the exemptions relied upon by the Company for the transfer or disposition of the Warrant or Warrant Shares.

 

(b)If
the proposed transfer or disposition of this Warrant or such Warrant Shares described in the written notice given pursuant to
this Section 7 may not be effected without registration or qualification of this Warrant or such Warrant Shares, the Holder will
limit its activities in respect to such transfer or disposition as are permitted by law.

 

(c)Any
transferee of all or a portion of this Warrant shall succeed to the rights and benefits of the initial Holder of this Warrant
under Sections 4.1 and 4.3 (subject, however, to the limitations set forth in Section 4.2), 4.4 and 4.5 of the Purchase Agreement
(registration rights, expenses, and indemnity).

 

8.NOTICES.
Whenever notice is required to be given under this Warrant, unless otherwise provided herein, such notice shall be given in accordance
with the notice provisions contained in the Purchase Agreement. The Company shall provide the Holder with prompt written notice
(i) immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, the calculation of such adjustment
and (ii) at least 20 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 shares of Common Stock, (B) with respect to any grants, issuances or sales of any stock or other securities
directly or indirectly convertible into or exercisable or exchangeable for shares of Common Stock or other property, pro rata
to the holders of shares of Common Stock 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.

 

9.AMENDMENT
AND WAIVER. The terms of this Warrant may be amended or waived (either generally or in a particular instance and either retroactively
or prospectively) only with the written consent of the Company and the Holder.

 

10.GOVERNING
LAW. This Warrant and all rights, obligations and liabilities hereunder shall be governed by, and construed in accordance
with, the internal laws of the State of Florida, without giving effect to the conflicts-of-law principles thereof.

 

    	 	6	 

    	 	 	 

    

 

11.ACCEPTANCE.
Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained
herein.

 

12.CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:

 

(a)“Nasdaq”
means www.Nasdaq.com.

 

(b)“Closing
Sale Price” means, for any security as of any date, (i) the last closing trade price for such security on the Principal
Market, as reported by Nasdaq, or, if the Principal Market begins to operate on an extended hours basis and does not designate
the closing trade price, then the last trade price of such security prior to 4:00 p.m., New York time, as reported by Nasdaq,
or (ii) if the foregoing does not apply, the last trade price of such security in the over-the-counter market for such security
as reported by Nasdaq, or (iii) if no last trade price is reported for such security by Nasdaq, the average of the bid and ask
prices of any market makers for such security as reported by the OTC Markets. If the Closing Sale Price cannot be calculated for
a security on a particular date on any of the foregoing bases, the Closing Sale Price of such security on such date shall be the
fair market value as mutually determined by the Company and the Holder. All such determinations to be appropriately adjusted for
any stock dividend, stock split, stock combination or other similar transaction during the applicable calculation period.

 

(c)“Common
Stock” means the Company’s common stock, and any other class of securities into which such securities may hereafter
be reclassified or changed.

 

(d)“Common
Stock Equivalents” means any securities of the Company that would entitle the holder thereof to acquire at any time
Common Stock, including without limitation any debt, preferred stock, rights, options, warrants or other instrument that is at
any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.

 

(e)“Dilutive
Issuance” is any issuance of Common Stock or Common Stock Equivalents described in Section 2(b) above; provided, however,
that a Dilutive Issuance shall not include any Exempt Issuance.

 

(f)“Exempt
Issuance” means the issuance of (i) shares of Common Stock or options to employees, officers, directors or consultants
of the Company pursuant to any stock or option plan duly adopted by a majority of the non-employee members of the Board of Directors
of the Company or a majority of the members of a committee of non-employee directors established for such purpose, (ii) any securities
upon the exercise or conversion of any securities issued pursuant to the Purchase Agreement, (iii) any Common Stock upon the exercise
or conversion of securities that are issued and outstanding as of the date of the Purchase Agreement, (iv) securities issued pursuant
to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, (v) shares of
Common Stock issued in connection with regularly scheduled dividend payments on the Series C Preferred Stock, and (vi) shares
of Common Stock issued pursuant to any loan or leasing arrangement, real property leasing arrangement, or debt financing from
a bank approved by the Board of Directors of the Company.

 

(g)“Principal
Market” means the primary national securities exchange on which the Common Stock is then traded.

 

(h)“Market
Price” means the lowest traded price of the Common Stock during the fifteen (15) Trading Days prior to the date of the
respective Exercise Notice.

 

(i)“Trading
Day” means (i) any day on which the Common Stock is listed or quoted and traded on its Principal Market, (ii) if the
Common Stock is not then listed or quoted and traded on any national securities exchange, then a day on which trading occurs on
any over-the-counter markets, or (iii) if trading does not occur on the over-the-counter markets, any Business Day.

 

*
* * * * * *

 

    	 	7	 

    	 	 	 

    

 

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

 

	 	CACHET
    FINANCIAL SOLUTIONS, INC.
	 	 	 
	 	 	/s/
    Jeffrey C. Mack
	 	Name:	Jeffrey
    C. Mack
	 	Title:	Chief
    Executive Officer

 

    			 

    	 	 	 

    

 

EXHIBIT
A

 

EXERCISE
NOTICE

 

(To
be executed by the registered holder to exercise this Common Stock Purchase Warrant)

 

The
Undersigned holder hereby exercises the right
to purchase _________________ of the shares of Common Stock (“Warrant Shares”) of Cachet Financial Solutions, Inc.,
a Delaware corporation (the “Company”), evidenced by the attached copy of the Common Stock Purchase Warrant (the “Warrant”).
Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant.

 

	1.	Form
    of Exercise Price. The Holder intends that payment of the Exercise Price shall be made as (check one):

 

	 	[  ]	a
    cash exercise with respect to _________________ Warrant Shares; or
	 	[  ]
    	by
    cashless exercise pursuant to the Warrant.

 

	2.	Payment
    of Exercise Price. If cash exercise is selected above, the holder shall pay the applicable Aggregate Exercise Price in
    the sum of $___________________ to the Company in accordance with the terms of the Warrant.

 

	3.	Delivery
    of Warrant Shares. The Company shall deliver to the holder __________________ Warrant Shares in accordance with the terms
    of the Warrant. 

 

	Date:
    	 	 

 

	 	 
	 	(Print
    Name of Registered Holder) 
	 	 	 
	 	By:
    	 
	 	Name:
    	 
	 	Title:
    	 

 

    			 

    	 	 	 

    

 

EXHIBIT
B

 

ASSIGNMENT
OF WARRANT

 

(To
be signed only upon authorized transfer of the Warrant)

 

For
Value Received, the undersigned hereby sells,
assigns, and transfers unto ____________________ the right to purchase _______________ shares of common stock of Cachet Financial
Solutions, Inc., to which the within Common Stock Purchase Warrant relates and appoints ____________________, as attorney-in-fact,
to transfer said right on the books of Cachet Financial Solutions, Inc. with full power of substitution and re-substitution in
the premises. By accepting such transfer, the transferee has agreed to be bound in all respects by the terms and conditions of
the within Warrant.

 

	Dated:
    	 	 

 

	 	 
	 	(Signature)
    *
	 	 
	 	 
	 	(Name)
    
	 	 
	 	 
	 	(Address)
	 	 
	 	 
	 	(Social
    Security or Tax Identification No.) 

 

*
The signature on this Assignment of Warrant must correspond to the name as written upon the face of the Common Stock Purchase
Warrant in every particular without alteration or enlargement or any change whatsoever. When signing on behalf of a corporation,
partnership, trust or other entity, please indicate your position(s) and title(s) with such entity.

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