Document:

Exhibit

Exhibit 10 (AC)

 
CARPENTER TECHNOLOGY CORPORATION

STOCK-BASED INCENTIVE COMPENSATION PLAN
FOR OFFICERS AND KEY EMPLOYEES

RESTRICTED STOCK UNIT AWARD AGREEMENT

AGREEMENT, effective as of [DATE] (the “Award Date”), by and between CARPENTER TECHNOLOGY CORPORATION (the “Company”) and [PARTICIPANT] (the “Participant”). Capitalized terms that are not defined in this Agreement have the same meaning as defined in the CARPENTER TECHNOLOGY CORPORATION STOCK-BASED INCENTIVE COMPENSATION PLAN FOR OFFICERS AND KEY EMPLOYEES (the “Plan”), a copy of which is attached. The terms, conditions and provisions of the Plan are applicable to this Award Agreement and are incorporated by reference. 

1. Grant of Award. Participant has been granted an Award of Restricted Stock Units under the Plan  comprised of an aggregate of the number of Restricted Stock Units set forth below (collectively, the “Units”). 

2. Duration of Restriction Period. The Restriction Period with respect to the Units will lapse as follows:

[VEST SCHEDULE - RSU]. 

3. Conditions of Forfeiture. Subject to the provisions of Section 4 hereof, the Units are subject to forfeiture by Participant at any time during the applicable Restriction Period immediately upon termination of Participant’s employment with the Company or a Subsidiary. Upon any such forfeiture, all rights of Participant with respect to the forfeited Units shall terminate and Participant shall have no further interest of any kind therein.  

4. Lapse of Restrictions on Death, Disability or Retirement. Notwithstanding any provision hereof to the contrary, in the event of termination of Participant’s employment prior to vesting by reason of (i) death, or (ii) Disability, the Units will not be forfeited and the Participant shall become vested with respect to the Units on the same date as such death or Disability.  In the event of a Participant’s Retirement during a Restriction Period after the first anniversary of the Grant Date, the Participant shall be vested in not less than a pro rata portion of the Units subject to such Restriction Period based on the number of days during the applicable Restriction Period during which the Participant was employed.   Upon a Participant’s Retirement, all unvested Units shall be forfeited; provided however, that the Committee reserves the right to vest unvested Units.

5. Time and Form of Payment. Payment of vested Units shall be made as soon as practicable (but not later than 30 days) following the close of a Restriction Period or, if earlier, within 30 days following the earlier of the Participant’s death, Disability or Retirement that constitutes a “Separation from Service” within the meaning of Code Section 409A. Payment shall be in the form of a number of shares of Common Stock equal to the number of Units subject hereto. Notwithstanding anything herein to the contrary, if the Participant’s Award is subject to the application of Code Section 409A and if the Participant is a “Specified Employee” within the meaning of Code Section 409A and the Treasury regulations and other guidance thereunder, the Participant may not receive payment with respect to any Units that are payable as a result of the Participant’s Separation from Service, earlier than six (6) months following the Participant’s Separation from Service, except that in the event of the Participant’s earlier death, such Units shall be paid within 30 days after the Company receives notice of the Participant’s death. 

6. Voting Rights. The Participant will not have the right to vote with respect to the Units prior to payment of Common Stock in satisfaction of the Units. 

7. Dividend Equivalencies. To the extent that any dividend was paid to the holders of the Company’s Common Stock during the Restriction Period and the Participant was employed by the Company or a Subsidiary on the date the dividend was paid to holders of the Company’s Common Stock, the Company will pay to the Participant a dividend equivalent in respect of the vested Units for all such dividends paid during the Restriction Period within 30 days following the date of the payment of Common Stock in satisfaction of the Units.  

8. Change in Control.  Notwithstanding anything in this Agreement to the contrary, if, within the two-year period immediately following the occurrence of a Change in Control pursuant to which the outstanding Awards under the Plan are assumed or converted into awards under another plan of a successor entity or business, the Participant’s employment is terminated by the Company for any reason other than for Cause or terminated by the Participant for Good Reason, any remaining conditions on forfeiture with respect to the Units shall immediately lapse.  However, if a Change in Control occurs pursuant to which the outstanding Awards under the Plan are not assumed or converted into awards under another plan of a successor entity or business, any remaining conditions on forfeiture with respect to the Units shall immediately lapse.

9. Tax Withholding. Participant authorizes the Company to deduct, to the extent required by statute or regulation, from payments of any kind due to Participant or anyone claiming through Participant, the amount of the federal, state, local or other taxes relating to any present or future Award under the Plan. This authority shall include authority to withhold or receive Common Stock or other property and to make cash payments in respect thereof in satisfaction of the Participant’s tax obligations.  Withholding of taxes in the form of shares of Common Stock from the profit attributable to the Award shall not occur at a rate that exceeds the maximum individual federal and state statutory tax rates in the applicable jurisdiction.  

10. Non-Competition and Non-Solicitation. Participant agrees to comply fully with any written agreement between the Company and the Participant which provides for post-termination of employment restrictions against solicitation or competition (the “Restrictive Covenant Agreement”); provided, however, that if no such Restrictive Covenant Agreement exists, the Participant shall not for a period of [six (6), twelve (12), eighteen (18)] months after Participant’s voluntary termination of employment with Company or involuntary termination of employment by Company [for “Cause”], either himself or together with other persons, directly or indirectly: (i) own, manage, operate, finance, join, control or participate in the ownership, management, operation, financing, or control of or be connected as an officer, director, employee, partner, principal, agent, representative, consultant or 

otherwise with, or have any financial interest in, or aid or assist anyone else in the conduct of, or use or permit Participant’s name to be used in connection with, any business engaged in the research, development, manufacture, sale, marketing or distribution of stainless steel, titanium, specialty alloys, metal powders or metal fabricated parts or components similar to or competitive with those manufactured by the Company (a “Competing Business”) as of the date the Participant’s employment with Company ends; provided, however, that nothing herein shall prevent the Participant from investing in the securities of any company listed on a national securities exchange, provided that Participant’s involvement with any such company is solely that of a stockholder of 5% or less of any class of the outstanding securities thereof; (ii) solicit or divert to any Competing Business any individual or entity that is a customer or prospective customer of the Company or its subsidiaries or affiliates, or was such a customer or prospective customer at any time during the eighteen (18) months prior to the date of Participant’s employment termination with the Company; (iii) induce, offer, assist, encourage or suggest (A) that another business or enterprise offer employment to or enter into a business affiliation with any Company employee, agent or representative, or any individual who acted as an employee, agent or representative of the Company in the previous six (6) months; or (B) that any Company employee, agent or representative (or individual who acted as an employee, agent or representative of the Company in the previous six (6) months) terminate his or her employment or business affiliation with the Company; or (iv) hire or participate in the hiring of any Company employee or any person who was an employee of the Company in the previous six (6) months, by any business, enterprise or employer.  For this purpose, “prospective customer” shall mean a person or business entity that the Company has identified as a user or potential user of the Company’s products and toward which the Company plans to direct sales or marketing activities.

In the event that the Company determines in good faith that the Participant violated the terms of any Restrictive Covenant Agreement, or, if there is no Restrictive Covenant Agreement, the provisions of the preceding paragraph: (i) this Award shall be forfeited and (ii) the Participant shall be obligated to return to the Company any shares previously issued under this Award or a cash payment equal to the value of the shares at the time such shares were sold or transferred, if any or all of the Award has been issued to the Participant or such recoupment is required by law.

11. Severability. The covenants in this Agreement are severable, and if any covenant or portion thereof is held to be invalid or unenforceable for any reason, such covenant or portion thereof shall be modified to the extent necessary to cure such invalidity or unenforceability and all other covenants and provisions shall remain valid and enforceable. 

12. Notices to Participant. Any notices or deliveries to Participant hereunder or under the Plan shall be directed to Participant at the address reflected for Participant on the Company’s payroll records or at such other address as Participant may designate in writing to the Company. 

13. Binding Effect. Subject to the terms of the Plan, this Agreement shall be binding upon and inure to the benefit of the Company and its assigns, and Participant, his heirs and personal representatives. 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the Award Date first above written. 

        

 
CARPENTER TECHNOLOGY CORPORATION          

         

By:                            
        Tony R. Thene
        President and Chief Executive Officer

PARTICIPANT

          
                            
[NAME]    

Number of Award Units: [# OF UNITS AWARDED]Exhibit 10.2

 

 

    	 	 	 

    	 

    

 

 

    	 	 	 

    	 

    

 

CERTIFICATE
OF DESIGNATIONS OF

SERIES D CONVERTIBLE PREFERRED STOCK OF

SIGMA LABS, INC.

 

I,
John Rice, hereby certify that I am the Chief Executive Officer of Sigma Labs, Inc (the “Company”), a corporation
organized and existing under the D Chapter 78 of the Nevada Revised Statues (the “NRS”), and further do hereby
certify:

 

That
pursuant to the authority expressly conferred upon the Board of Directors of the Company (the “Board”) by the
Company’s Articles of Incorporation, as amended (the “Articles of Incorporation”), and Section 78.195
of Chapter 78 of the NRS, the Board on January 24, 2020 adopted the following resolution determining it desirable and in the best
interests of the Company and its shareholders for the Company to create a series of Seven Thousand, Seven Hundred and Ninety Six
(7,796) shares of preferred stock designated as “Series D Convertible Preferred Stock”, none of which shares
have been issued:

 

RESOLVED,
that pursuant to the authority vested in the Board this Company, in accordance with the provisions of the Articles of Incorporation,
a series of preferred stock, par value $0.001 per share, of the Company be and hereby is created, and that the designation and
number of shares thereof and the voting and other powers, preferences and relative, participating, optional or other rights of
the shares of such series and the qualifications, limitations and restrictions thereof are as follows:

 

TERMS
OF SERIES D CONVERTIBLE PREFERRED STOCK

 

1.
Designation and Number of Shares. There shall hereby be created and established a series of preferred stock of the Company
designated as “Series D Convertible Preferred Stock” (the “Preferred Shares”). The authorized number
of Preferred Shares shall be 7,796 shares. Each Preferred Share shall have a par value of $0.001. Capitalized terms not defined
herein shall have the meaning as set forth in Section 31 below.

 

2.
Ranking. Except to the extent that the holders of at least a majority of the outstanding Preferred Shares (the “Required
Holders”) expressly consent to the creation of Parity Stock (as defined below) or Senior Preferred Stock (as defined
below) in accordance with Section 16, all shares of capital stock of the Company (including the Series E Preferred Stock to be
issued on or prior to the Initial Issuance Date (as defined below)) shall be junior in rank to all Preferred Shares with respect
to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company
(such junior stock is referred to herein collectively as “Junior Stock”). The rights of all such shares of
capital stock of the Company shall be subject to the rights, powers, preferences and privileges of the Preferred Shares. Without
limiting any other provision of this Certificate of Designations, without the prior express consent of the Required Holders, voting
separate as a single class, the Company shall not hereafter authorize or issue any additional or other shares of capital stock
that is (i) of senior rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon
the liquidation, dissolution and winding up of the Company (collectively, the “Senior Preferred Stock”), (ii)
of pari passu rank to the Preferred Shares in respect of the preferences as to dividends, distributions and payments upon the
liquidation, dissolution and winding up of the Company (collectively, the “Parity Stock”) or (iii) any Junior
Stock having a maturity date or any other date requiring redemption or repayment of such shares of Junior Stock prior to such
time as no Preferred Shares remain outstanding. In the event of the merger or consolidation of the Company with or into another
corporation, the Preferred Shares shall maintain their relative rights, powers, designations, privileges and preferences provided
for herein and no such merger or consolidation shall result inconsistent therewith.

 

    	 		 

    	 

    

 

3.
Dividends.

 

(a)
From and after January 28, 2020 (the “Initial Issuance Date”), each holder of a Preferred Share (each, a “Holder”
and collectively, the “Holders”) shall be entitled to receive dividends (“Dividends”), which
Dividends shall be computed on the basis of a 360-day year and twelve 30-day months and shall increase the Stated Value of the
Preferred Shares on each Dividend Date (each, a “Capitalized Dividend”).

 

(b)
Prior to the capitalization of Dividends on an Dividend Date, Dividends on the Preferred Shares shall accrue at the Dividend Rate
and be payable by way of inclusion of the Dividends in the Conversion Amount on each Conversion Date in accordance with Section
4(c)(i) or upon any redemption in accordance with Section 11 or upon any required payment upon any Bankruptcy Triggering Event.
From and after the occurrence and during the continuance of any Triggering Event, the Dividend Rate shall automatically be increased
to fifteen percent (15.0%) per annum (the “Default Rate”). In the event that such Triggering Event is subsequently
cured (and no other Triggering Event then exists), the adjustment referred to in the preceding sentence shall cease to be effective
as of the calendar day immediately following the date of such cure; provided that the Dividends as calculated and unpaid at such
increased rate during the continuance of such Triggering Event shall continue to apply to the extent relating to the days after
the occurrence of such Triggering Event through and including the date of such cure of such Triggering Event.

 

4.
Conversion. At any time after the Initial Issuance Date, each Preferred Share shall be convertible into validly issued,
fully paid and non-assessable shares of Common Stock (as defined below), on the terms and conditions set forth in this Section
4.

 

(a)
Holder’s Conversion Right. Subject to the provisions of Section 4(d), at any time or times on or after the Initial
Issuance Date, each Holder shall be entitled to convert any portion of the outstanding Preferred Shares held by such Holder into
validly issued, fully paid and non-assessable shares of Common Stock in accordance with Section 4(c) at the Conversion Rate (as
defined below). The Company shall not issue any fraction of a share of Common Stock upon any conversion. If the issuance would
result in the issuance of a fraction of a share of Common Stock, the Company shall round such fraction of a share of Common Stock
up to the nearest whole share. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses
(including, without limitation, fees and expenses of the Transfer Agent (as defined below)) that may be payable with respect to
the issuance and delivery of Common Stock upon conversion of any Preferred Shares.

 

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(b)
Conversion Rate. The number of shares of Common Stock issuable upon conversion of any Preferred Share pursuant to Section
4(a) shall be determined by dividing (x) the Conversion Amount of such Preferred Share by (y) the Conversion Price (the “Conversion
Rate”):

 

(i)
“Conversion Amount” means, with respect to each Preferred Share, as of the applicable date of determination,
the sum of (A) the Stated Value thereof plus (B) the Additional Amount thereon, plus (C) any accrued and unpaid Late Charges (as
defined below in Section 24(c)) with respect to such Stated Value and Additional Amount as of such date of determination, plus
(D) the Make-Whole Amount.

 

(ii)
“Conversion Price” means, with respect to each Preferred Share, as of any Conversion Date or other date of
determination, $1.00, subject to adjustment as provided herein.

 

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(c)
Mechanics of Conversion. The conversion of each Preferred Share shall be conducted in the following manner:

 

(i)
Optional Conversion. To convert a Preferred Share into shares of Common Stock on any date (a “Conversion Date”),
a Holder shall deliver (whether via facsimile, electronic mail or otherwise), for receipt on or prior to 11:59 p.m., New York
time, on such date, a copy of an executed notice of conversion of the share(s) of Preferred Shares subject to such conversion
in the form attached hereto as Exhibit I (the “Conversion Notice”) to the Company. If required
by Section 4(c)(iii), within two (2) Trading Days following a conversion of any such Preferred Shares as aforesaid, such Holder
shall surrender to a nationally recognized overnight delivery service for delivery to the Company the original certificates, if
any, representing the Preferred Shares (the “Preferred Share Certificates”) so converted as aforesaid (or an
indemnification undertaking with respect to the Preferred Shares in the case of its loss, theft or destruction as contemplated
by Section 18(b)). On the date of receipt of a Conversion Notice, the Company shall transmit by facsimile or electronic mail an
acknowledgment of confirmation and representation as to whether such shares of Common Stock may then be resold pursuant to Rule
144 or an effective and available registration statement, in the form attached hereto as Exhibit II, of receipt
of such Conversion Notice to such Holder and the Company’s transfer agent (the “Transfer Agent”), which
confirmation shall constitute an instruction to the Transfer Agent to process such Conversion Notice in accordance with the terms
herein. On or before the second (2nd) Trading Day following each date on which the Company has received a Conversion Notice (or
such earlier date as required pursuant to the 1934 Act or other applicable law, rule or regulation for the settlement of a trade
initiated on the applicable Conversion Date of such shares of Common Stock issuable pursuant to such Conversion Notice) (the “Share
Delivery Deadline”), the Company shall (1) provided that the Transfer Agent is participating in The Depository Trust
Company’s (“DTC”) Fast Automated Securities Transfer Program and such shares of Common Stock are eligible
to be resold pursuant to Rule 144 or an effective registration statement, credit such aggregate number of shares of Common Stock
to which such Holder shall be entitled pursuant to such conversion to such Holder’s or its designee’s balance account
with DTC through its Deposit/Withdrawal at Custodian system, or (2) if the Transfer Agent is not participating in the DTC Fast
Automated Securities Transfer Program or such shares of Common Stock are not eligible to be resold pursuant to Rule 144 or an
effective registration statement, upon the request of such Holder, issue and deliver (via reputable overnight courier) to the
address as specified in such Conversion Notice, a certificate, registered in the name of such Holder or its designee, for the
number of shares of Common Stock to which such Holder shall be entitled. If the number of Preferred Shares represented by the
Preferred Share Certificate(s) submitted for conversion pursuant to Section 4(c)(iii) is greater than the number of Preferred
Shares being converted, then the Company shall, as soon as practicable and in no event later than two (2) Trading Days after receipt
of the Preferred Share Certificate(s) and at its own expense, issue and deliver to such Holder (or its designee) a new Preferred
Share Certificate (in accordance with Section 18(d)) representing the number of Preferred Shares not converted. The Person or
Persons entitled to receive the shares of Common Stock issuable upon a conversion of Preferred Shares shall be treated for all
purposes as the record holder or holders of such shares of Common Stock on the Conversion Date. Notwithstanding anything to the
contrary contained in this Certificate of Designations or the Registration Rights Agreement, after the effective date of a Registration
Statement (as defined in the Registration Rights Agreement) and prior to a Holder’s receipt of the notice of a Grace Period
(as defined in the Registration Rights Agreement), the Company shall cause the Transfer Agent to deliver unlegended shares of
Common Stock to such Holder (or its designee) in connection with any sale of Registrable Securities (as defined in the Registration
Rights Agreement) with respect to which such Holder has entered into a contract for sale, and delivered a copy of the prospectus
included as part of the particular Registration Statement to the extent applicable, and for which such Holder has not yet settled.
Notwithstanding the foregoing, prior to the earlier to occur of (x) the Share Increase Shareholder Approval Date (as defined in
the Securities Purchase Agreement) and (y) the Shareholder Meeting Deadline (as defined in the Securities Purchase Agreement),
no Holder shall be permitted to convert Preferred Shares hereunder (or exercise Common Warrants of such Holder, as applicable)
to the extent that after such conversion such Holder shall have received, whether upon conversion of Preferred Shares and/or exercise
of Common Warrants, as applicable, more than such Holder’s Authorized Share Allocation (as defined below). For the avoidance
of doubt, no ink original Conversion Notices, other notices or medallion guarantees will be required by any Holder to convert
any Preferred Shares or for such Holder take any other action in connection herewith.

 

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(ii)
Company’s Failure to Timely Convert. If the Company shall fail, for any reason or for no reason, on or prior to the
applicable Share Delivery Deadline, either (I) if the Transfer Agent is not participating in the DTC Fast Automated Securities
Transfer Program or the applicable shares are not eligible to be resold pursuant to Rule 144 or an effective registration statement,
to issue and deliver to such Holder (or its designee) a certificate for the number of shares of Common Stock to which such Holder
is entitled and register such shares of Common Stock on the Company’s share register or, if the Transfer Agent is participating
in the DTC Fast Automated Securities Transfer Program and such shares are eligible to be resold pursuant to Rule 144 or an effective
registration statement, to credit such Holder’s or its designee’s balance account with DTC for such number of shares
of Common Stock to which such Holder is entitled upon such Holder’s conversion of any Conversion Amount (as the case may
be) or (II) if an effective Registration Statement covering the resale of the applicable shares of Common Stock that are the subject
of the Conversion Notice (the “Unavailable Conversion Shares”) is not available for the resale of such Unavailable
Conversion Shares (solely to the extent such Unavailable Conversion Shares were ever available pursuant to such Registration Statement)
and the Company fails to promptly, but in no event later than as required pursuant to the Registration Rights Agreement (x) notify
such Holder and (y) deliver the shares of Common Stock electronically without any restrictive legend by crediting such aggregate
number of shares of Common Stock to which such Holder is entitled pursuant to such exercise to the Holder’s or its designee’s
balance account with DTC through its Deposit/Withdrawal At Custodian system (the event described in the immediately foregoing
clause (II) is hereinafter referred as a “Notice Failure” and together with the event described in clause (I)
above, a “Conversion Failure”), then, in addition to all other remedies available to such Holder, (X) the Company
shall pay in cash to such Holder on each day after the Share Delivery Deadline that the issuance of such shares of Common Stock
is not timed effected an amount equal to 2% of the product of (A) the sum of the number of shares of Common Stock not issued to
such Holder on or prior to the Share Delivery Deadline and to which such Holder is entitled, multiplied by (B) any trading price
of the Common Stock selected by such Holder in writing as in effect at any time during the period beginning on the applicable
Conversion Date and ending on the applicable Share Delivery Deadline, and (Y) such Holder, upon written notice to the Company,
may void its Conversion Notice with respect to, and retain or have returned, as the case may be, all, or any portion, of such
Preferred Shares that has not been converted pursuant to such Conversion Notice; provided that the voiding of an Conversion Notice
shall not affect the Company’s obligations to make any payments which have accrued prior to the date of such notice pursuant
to this Section 4(c)(ii) or otherwise. In addition to the foregoing, if on or prior to the Share Delivery Deadline either (A)
the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program or such Warrant Common Shares are
not eligible to be resold pursuant to Rule 144 or an effective registration statement, the Company shall fail to issue and deliver
to such Holder (or its designee) a certificate and register such shares of Common Stock on the Company’s share register
or, if the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program and such Warrant Common Shares
are eligible to be resold pursuant to Rule 144 or an effective registration statement, the Transfer Agent shall fail to credit
the balance account of such Holder or such Holder’s designee, as applicable, with DTC for the number of shares of Common
Stock to which such Holder is entitled upon such Holder’s conversion hereunder or pursuant to the Company’s obligation
pursuant to clause (ii) below or (B) a Notice Failure occurs, and if on or after such Share Delivery Deadline such Holder purchases
(in an open market transaction or otherwise) shares of Common Stock corresponding to all or any portion of the number of shares
of Common Stock issuable upon such conversion that such Holder is entitled to receive from the Company and has not received from
the Company in connection with such Conversion Failure or Notice Failure, as applicable (a “Buy-In”), then,
in addition to all other remedies available to such Holder, the Company shall, within two (2) Business Days after receipt of such
Holder’s request and in such Holder’s discretion, either: (I) pay cash to such Holder in an amount equal to such Holder’s
total purchase price (including brokerage commissions and other out-of-pocket expenses, if any) for the shares of Common Stock
so purchased (including, without limitation, by any other Person in respect, or on behalf, of such Holder) (the “Buy-In
Price”), at which point the Company’s obligation to so issue and deliver such certificate (and to issue such shares
of Common Stock) or credit to the balance account of such Holder or such Holder’s designee, as applicable, with DTC for
the number of shares of Common Stock to which such Holder is entitled upon such Holder’s conversion hereunder (as the case
may be) (and to issue such shares of Common Stock) shall terminate, or (II) promptly honor its obligation to so issue and deliver
to such Holder a certificate or certificates representing such shares of Common Stock or credit the balance account of such Holder
or such Holder’s designee, as applicable, with DTC for the number of shares of Common Stock to which such Holder is entitled
upon such Holder’s conversion hereunder (as the case may be) and pay cash to such Holder in an amount equal to the excess
(if any) of the Buy-In Price over the product of (x) such number of shares of Common Stock multiplied by (y) the lowest Closing
Sale Price of the Common Stock on any Trading Day during the period commencing on the date of the applicable Conversion Notice
and ending on the date of such issuance and payment under this clause (II) (the “Buy-In Payment Amount”). Nothing
herein shall limit the Holder’s right to pursue any other remedies available to it hereunder, at law or in equity, including,
without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely
deliver certificates representing shares of Common Stock (or to electronically deliver such shares of Common Stock) upon the conversion
of Preferred Shares as required pursuant to the terms hereof.

 

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(iii)
Registration; Book-Entry. At the time of issuance of any Preferred Shares hereunder, the applicable Holder may, by written
request (including by electronic-mail) to the Company, elect to receive such Preferred Shares in the form of one or more Preferred
Share Certificates or in Book-Entry form. The Company (or the Transfer Agent, as custodian for the Preferred Shares) shall maintain
a register (the “Register”) for the recordation of the names and addresses of the Holders of each Preferred
Share and the Stated Value of the Preferred Shares and whether the Preferred Shares are held by such Holder in Preferred Share
Certificates or in Book-Entry form (the “Registered Preferred Shares”). The entries in the Register shall be
conclusive and binding for all purposes absent manifest error. The Company and each Holder of the Preferred Shares shall treat
each Person whose name is recorded in the Register as the owner of a Preferred Share for all purposes (including, without limitation,
the right to receive payments and Dividends hereunder) notwithstanding notice to the contrary. A Registered Preferred Share may
be assigned, transferred or sold only by registration of such assignment or sale on the Register. Upon its receipt of a written
request to assign, transfer or sell one or more Registered Preferred Shares by such Holder thereof, the Company shall record the
information contained therein in the Register and issue one or more new Registered Preferred Shares in the same aggregate Stated
Value as the Stated Value of the surrendered Registered Preferred Shares to the designated assignee or transferee pursuant to
Section 18, provided that if the Company does not so record an assignment, transfer or sale (as the case may be) of such Registered
Preferred Shares within two (2) Business Days of such a request, then the Register shall be automatically deemed updated to reflect
such assignment, transfer or sale (as the case may be). Notwithstanding anything to the contrary set forth in this Section 4,
following conversion of any Preferred Shares in accordance with the terms hereof, the applicable Holder shall not be required
to physically surrender such Preferred Shares held in the form of a Preferred Share Certificate to the Company unless (A) the
full or remaining number of Preferred Shares represented by the applicable Preferred Share Certificate are being converted (in
which event such certificate(s) shall be delivered to the Company as contemplated by this Section 4(c)(iii)) or (B) such Holder
has provided the Company with prior written notice (which notice may be included in a Conversion Notice) requesting reissuance
of Preferred Shares upon physical surrender of the applicable Preferred Share Certificate. Each Holder and the Company shall maintain
records showing the Stated Value, Dividends and Late Charges converted and/or paid (as the case may be) and the dates of such
conversions and/or payments (as the case may be) or shall use such other method, reasonably satisfactory to such Holder and the
Company, so as not to require physical surrender of a Preferred Share Certificate upon conversion. If the Company does not update
the Register to record such Stated Value, Dividends and Late Charges converted and/or paid (as the case may be) and the dates
of such conversions and/or payments (as the case may be) within two (2) Business Days of such occurrence, then the Register shall
be automatically deemed updated to reflect such occurrence. In the event of any dispute or discrepancy, such records of such Holder
establishing the number of Preferred Shares to which the record holder is entitled shall be controlling and determinative in the
absence of manifest error. A Holder and any transferee or assignee, by acceptance of a certificate, acknowledge and agree that,
by reason of the provisions of this paragraph, following conversion of any Preferred Shares, the number of Preferred Shares represented
by such certificate may be less than the number of Preferred Shares stated on the face thereof. Each Preferred Share Certificate
shall bear the following legend:

 

ANY
TRANSFEREE OR ASSIGNEE OF THIS CERTIFICATE SHOULD CAREFULLY REVIEW THE TERMS OF THE CORPORATION’S CERTIFICATE OF DESIGNATIONS
RELATING TO THE SHARES OF SERIES D PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE, INCLUDING SECTION 4(c)(iii) THEREOF. THE NUMBER
OF SHARES OF SERIES D PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE MAY BE LESS THAN THE NUMBER OF SHARES OF SERIES D PREFERRED
STOCK STATED ON THE FACE HEREOF PURSUANT TO SECTION 4(c)(iii) OF THE CERTIFICATE OF DESIGNATIONS RELATING TO THE SHARES OF SERIES
D PREFERRED STOCK REPRESENTED BY THIS CERTIFICATE.

 

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

 

(d)
Limitation on Beneficial Ownership.

 

(i)
Beneficial Ownership. The Company shall not effect the conversion of any of the Preferred Shares held by a Holder, and
such Holder shall not have the right to convert any of the Preferred Shares held by such Holder pursuant to the terms and conditions
of this Certificate of Designations and any such conversion shall be null and void and treated as if never made, to the extent
that after giving effect to such conversion, such Holder together with the other Attribution Parties collectively would beneficially
own in excess of 4.99% (the “Maximum Percentage”) of the shares of Common Stock outstanding immediately after
giving effect to such conversion. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially
owned by such Holder and the other Attribution Parties shall include the number of shares of Common Stock held by such Holder
and all other Attribution Parties plus the number of shares of Common Stock issuable upon conversion of the Preferred Shares with
respect to which the determination of such sentence is being made, but shall exclude shares of Common Stock which would be issuable
upon (A) conversion of the remaining, nonconverted Preferred Shares beneficially owned by such Holder or any of the other Attribution
Parties and (B) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including,
without limitation, any convertible notes, convertible preferred stock or warrants, including the Preferred Shares, the Preferred
Warrants and the Common Warrants) beneficially owned by such Holder or any other Attribution Party subject to a limitation on
conversion or exercise analogous to the limitation contained in this Section 4(d)(i). For purposes of this Section 4(d)(i), beneficial
ownership shall be calculated in accordance with Section 13(d) of the 1934 Act. For purposes of determining the number of outstanding
shares of Common Stock a Holder may acquire upon the conversion of such Preferred Shares without exceeding the Maximum Percentage,
such Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s most recent Annual
Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other public filing with the SEC, as the case
may be, (y) a more recent public announcement by the Company or (z) any other written notice by the Company or the Transfer Agent,
if any, setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”).
If the Company receives a Conversion Notice from a Holder at a time when the actual number of outstanding shares of Common Stock
is less than the Reported Outstanding Share Number, the Company shall notify such Holder in writing of the number of shares of
Common Stock then outstanding and, to the extent that such Conversion Notice would otherwise cause such Holder’s beneficial
ownership, as determined pursuant to this Section 4(d)(i), to exceed the Maximum Percentage, such Holder must notify the Company
of a reduced number of shares of Common Stock to be purchased pursuant to such Conversion Notice. For any reason at any time,
upon the written or oral request of any Holder, the Company shall within one (1) Business Day confirm orally and in writing or
by electronic mail to such 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
such Preferred Shares, by such Holder and any other Attribution Party since the date as of which the Reported Outstanding Share
Number was reported. In the event that the issuance of shares of Common Stock to a Holder upon conversion of such Preferred Shares
results in such Holder and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum
Percentage of the number of outstanding shares of Common Stock (as determined under Section 13(d) of the 1934 Act), the number
of shares so issued by which such Holder’s and the other Attribution Parties’ aggregate beneficial ownership exceeds
the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio,
and such Holder shall not have the power to vote or to transfer the Excess Shares. Upon delivery of a written notice to the Company,
any Holder may from time to time increase (with such increase not effective until the sixty-first (61st) day after
delivery of such notice) or decrease the Maximum Percentage of such Holder to any other percentage not in excess of 9.99% as specified
in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st)
day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to such Holder and the
other Attribution Parties and not to any other Holder that is not an Attribution Party of such Holder. For purposes of clarity,
the shares of Common Stock issuable to a Holder pursuant to the terms of this Certificate of Designations in excess of the Maximum
Percentage shall not be deemed to be beneficially owned by such Holder for any purpose including for purposes of Section 13(d)
or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to convert such Preferred Shares pursuant to this paragraph shall have
any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination of convertibility.
The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms
of this Section 4(d)(i) to the extent necessary to correct this paragraph (or any portion of this paragraph) which may be defective
or inconsistent with the intended beneficial ownership limitation contained in this Section 4(d)(i) or to make changes or supplements
necessary or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived
and shall apply to a successor holder of such Preferred Shares.

 

    	7

    	 

    

 

(ii)
Principal Market Regulation. The Company shall not issue any shares of Common Stock upon conversion of any Preferred Shares
or otherwise pursuant to the terms of this Certificate of Designations if the issuance of such shares of Common Stock would exceed
the aggregate number of shares of Common Stock which the Company may issue upon conversion of the Preferred Shares without breaching
the Company’s obligations under the rules and regulations the listing rules of the Principal Market (the number of shares
which may be issued without violating such rules and regulations, including rules related to the aggregate offerings under NASDAQ
Listing Rule 5635(d), the “Exchange Cap”), except that such limitation shall not apply in the event that the
Company (A) obtains the approval of its shareholders as required by the applicable rules and regulations of the Principal Market
for issuances of shares of Common Stock in excess of such amount or (B) obtains a written opinion from outside counsel to the
Company that such approval is not required, which opinion shall be reasonably satisfactory to the Required Holders. Until such
approval or such written opinion is obtained, no Holder shall be issued in the aggregate, upon conversion of any Preferred Shares
in an amount greater than the product of (i) the Exchange Cap as of the Initial Issuance Date multiplied by (ii) the quotient
of (1) the aggregate number of Preferred Shares issued to such Holder on the Initial Issuance Date divided by (2) the aggregate
number of Preferred Shares issued to the Holders on the Initial Issuance Date (with respect to each Holder, the “Exchange
Cap Allocation”). In the event that any Holder shall sell or otherwise transfer any of such Holder’s Preferred
Shares, the transferee shall be allocated a pro rata portion of such Holder’s Exchange Cap Allocation with respect to such
portion of such Preferred Shares so transferred, and the restrictions of the prior sentence shall apply to such transferee with
respect to the portion of the Exchange Cap Allocation so allocated to such transferee. Upon conversion in full of a holder’s
Preferred Shares, the difference (if any) between such holder’s Exchange Cap Allocation and the number of shares of Common
Stock actually issued to such holder upon such holder’s conversion in full of such Preferred Shares shall be allocated,
to the respective Exchange Cap Allocations of the remaining holders of Preferred Shares on a pro rata basis in proportion to the
shares of Common Stock underlying the Preferred Shares then held by each such holder of Preferred Shares. In the event that after
the Shareholder Meeting Deadline (as defined in the Securities Purchase Agreement) the Company is prohibited from issuing any
shares of Common Stock pursuant to this Section 4(d)(ii)(the “Exchange Cap Shares”) to a Holder, the Company
shall pay cash to such Holder in exchange for the redemption of such number of Preferred Shares held by such Holder that are not
convertible into such Exchange Cap Shares at a price equal to the sum of (i) the product of (x) such number of Exchange Cap Shares
and (y) the greatest Closing Sale Price of the Common Stock on any Trading Day during the period commencing on the date such Holder
delivers the applicable Conversion Notice with respect to such Exchange Cap Shares to the Company and ending on the date of such
issuance and payment under this Section 4(d)(ii) and (ii) to the extent of any Buy-In related thereto, any Buy-In Payment Amount,
any brokerage commissions and other out-of-pocket expenses, if any, of such Holder incurred in connection therewith.

 

(e)
Right of Alternate Conversion.

 

(i)
General. Subject to Section 4(d), at any time, such Holder may, at such Holder’s option, by delivery of a Conversion
Notice to the Company (the date of any such Conversion Notice, each an “Alternate Conversion Date”), convert
all, or any number of Preferred Shares (such Conversion Amount of the Preferred Shares to be converted pursuant to this Section
4(e)(ii), each, an “Alternate Conversion Amount”) into shares of Common Stock at the Alternate Conversion Price
(each an “Alternate Conversion”).

 

    	8

    	 

    

 

(ii)
Mechanics of Alternate Conversion. On any Alternate Conversion Date, a Holder may voluntarily convert any Alternate Conversion
Amount of Preferred Shares pursuant to Section 4(c) (with “Alternate Conversion Price” replacing “Conversion
Price” for all purposes hereunder with respect to such Alternate Conversion and, if such Conversion Notice is delivered
during a Triggering Event Redemption Right Period (as defined below), with “Redemption Premium of the Conversion Amount”
replacing “Conversion Amount” in clause (x) of the definition of Conversion Rate above with respect to such Alternate
Conversion) by designating in the Conversion Notice delivered pursuant to this Section 4(e) of this Certificate of Designations
that such Holder is electing to use the Alternate Conversion Price for such conversion; provided that in the event of the Conversion
Floor Price Condition, on the applicable Alternate Conversion Date the Company shall also deliver to the Holder the applicable
Alternate Conversion Floor Amount. Notwithstanding anything to the contrary in this Section 4(e), but subject to Section 4(d),
until the Company delivers shares of Common Stock representing the applicable Alternate Conversion Amount of Preferred Shares
to such Holder, such Preferred Shares may be converted by such Holder into shares of Common Stock pursuant to Section 4(c) without
regard to this Section 4(e).

 

5.
Triggering Event Redemptions.

 

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

 

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

 

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

 

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

 

    	9

    	 

    

 

(iv)
the Company’s (A) failure to cure a Conversion Failure (as defined herein) or a Delivery Failure (as defined in the Common
Warrants) by delivery of the required number of shares of Common Stock within five (5) Trading Days after the applicable Conversion
Date or exercise date (as the case may be) or (B) notice, written or oral, to any holder of Preferred Shares, Preferred Warrants
or Common Warrants, including, without limitation, by way of public announcement or through any of its agents, at any time, of
its intention not to comply, as required, with a request for exercise of any Common Warrants for Warrant Common Shares in accordance
with the provisions of the Common Warrants or a request for conversion of any Preferred Shares into shares of Common Stock that
is requested in accordance with the provisions of this Certificate of Designations, other than pursuant to Section 4(d) hereof
or a request for conversion of any Preferred Warrants into Preferred Shares that is requested in accordance with the provisions
of this Certificate of Designations;

 

(v)
except to the extent the Company is in compliance with Section 10(b) below, at any time after the earlier to occur of (x) the
Share Increase Shareholder Approval Date and (y) the Shareholder Meeting Deadline, and following the tenth (10th) consecutive
day that a Holder’s Authorized Share Allocation (as defined in Section 10(a) below) is less than the sum of (A) 200% of
the number of shares of Common Stock that such Holder would be entitled to receive upon a conversion, in full, of all of the Preferred
Shares then held by such Holder at the Alternate Conversion Price then in effect (without regard to any limitations on conversion
set forth in this Certificate of Designations) (B) 100% of the number of Preferred Shares that such Holder would be entitled to
receive upon exercise, in full, of all of such Holder’s Preferred Warrants and (C) 150% of the number of shares of Common
Stock that such Holder would then be entitled to receive upon exercise in full of all of such Holder’s Common Warrants (without
regard to any limitations on exercise set forth in the Common Warrants);

 

(vi)
the Company’s failure to capitalize any Dividend on any Dividend Date (whether or not declared by the Board);

 

(vii)
the Company’s failure to pay any amount when and as due under this Certificate of Designations (including, without limitation,
the Company’s failure to pay any redemption payments or amounts hereunder), the Securities Purchase Agreement or any other
Transaction Document or any other agreement, document, certificate or other instrument delivered in connection with the transactions
contemplated hereby and thereby (in each case, whether or not permitted pursuant to the NRS), solely to the extent such failure
remains uncured for a period of at least five (5) Trading Days;

 

    	10

    	 

    

 

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

 

(ix)
the occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $$125,000 of
Indebtedness (as defined in the Securities Purchase Agreement) of the Company or any of its Subsidiaries;

 

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

 

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

 

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

 

    	11

    	 

    

 

(xiii)
a final judgment or judgments for the payment of money aggregating in excess of $$125,000 are rendered against the Company and/or
any of its Subsidiaries and which judgments are not, within thirty (30) days after the entry thereof, bonded, discharged, settled
or stayed pending appeal, or are not discharged within thirty (30) days after the expiration of such stay; provided, however,
any judgment which is covered by insurance or an indemnity from a credit worthy party shall not be included in calculating the
$$125,000 amount set forth above so long as the Company provides each Holder a written statement from such insurer or indemnity
provider (which written statement shall be reasonably satisfactory to each Holder) to the effect that such judgment is covered
by insurance or an indemnity and the Company or such Subsidiary (as the case may be) will receive the proceeds of such insurance
or indemnity within thirty (30) days of the issuance of such judgment;

 

(xiv)
the Company and/or any Subsidiary, individually or in the aggregate, either (i) fails to pay, when due, or within any applicable
grace period, any payment with respect to any Indebtedness in excess of $$125,000 due to any third party (other than, with respect
to unsecured Indebtedness only, payments contested by the Company and/or such Subsidiary (as the case may be) in good faith by
proper proceedings and with respect to which adequate reserves have been set aside for the payment thereof in accordance with
GAAP) or is otherwise in breach or violation of any agreement for monies owed or owing in an amount in excess of $$125,000, which
breach or violation permits the other party thereto to declare a default or otherwise accelerate amounts due thereunder, or (ii)
suffer to exist any other circumstance or event that would, with or without the passage of time or the giving of notice, result
in a default or event of default under any agreement binding the Company or any Subsidiary, which default or event of default
would or is likely to have a material adverse effect on the business, assets, operations (including results thereof), liabilities,
properties, condition (including financial condition) or prospects of the Company or any of its Subsidiaries, individually or
in the aggregate;

 

(xv)
other than as specifically set forth in another clause of this Section 5(a), the Company or any Subsidiary breaches any representation
or warranty in any material respect (other than the representations or warranties subject to material adverse effect on materiality
limitation, which may not be breached in any respect) or any covenant or other term or condition of any Transaction Document,
except, in the case of a breach of a covenant or other term or condition that is curable, only if such breach remains uncured
for a period of five (5) consecutive Trading Days;

 

    	12

    	 

    

 

(xvi)
a false or inaccurate certification (including a false or inaccurate deemed certification) by the Company as to whether any Triggering
Event has occurred;

 

(xvii)
if neither John Rice or Mark Ruport is the chief executive officer of the Company and a qualified replacement, acceptable to the
Holder, in its sole discretion, is not appointed in either case within fifteen (15) Business Days;

 

(xviii)
any breach or failure in any respect by the Company or any Subsidiary to comply with any provision of Section 13(m) of this Certificate
of Designations;

 

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

 

(xx)
any provision of any Transaction Document shall at any time for any reason (other than pursuant to the express terms thereof)
cease to be valid and binding on or enforceable against the parties thereto, or the validity or enforceability thereof shall be
contested, directly or indirectly, by the Company or any Subsidiary, or a proceeding shall be commenced by the Company or any
Subsidiary or any governmental authority having jurisdiction over any of them, seeking to establish the invalidity or unenforceability
thereof or the Company or any of its Subsidiaries shall deny in writing that it has any liability or obligation purported to be
created under one or more Transaction Documents.

 

    	13

    	 

    

 

(b)
Notice of a Triggering Event; Redemption Right. Upon the occurrence of a Triggering Event with respect to the Preferred
Shares, the Company shall within one (1) Business Day deliver written notice thereof via facsimile or electronic mail and overnight
courier (with next day delivery specified) (an “Triggering Event Notice”) to each Holder. At any time after
the earlier of a Holder’s receipt of a Triggering Event Notice and such Holder becoming aware of a Triggering Event (such
earlier date, the “Triggering Event Right Commencement Date”) and ending (such ending date, the “Triggering
Event Right Expiration Date”, and each such period, an “Triggering Event Redemption Right Period”)
on the sixtieth (60th) Trading Day after the later of (x) the date such Triggering Event is cured and (y) such Holder’s
receipt of a Triggering Event Notice that includes (I) a reasonable description of the applicable Triggering Event, (II) a certification
as to whether, in the opinion of the Company, such Triggering Event is capable of being cured and, if applicable, a reasonable
description of any existing plans of the Company to cure such Triggering Event and (III) a certification as to the date the Triggering
Event occurred and, if cured on or prior to the date of such Triggering Event Notice, the applicable Triggering Event Right Expiration
Date, such Holder may require the Company to redeem (regardless of whether such Triggering Event has been cured on or prior to
the Triggering Event Right Expiration Date) all or any of the Preferred Shares by delivering written notice thereof (the “Triggering
Event Redemption Notice”) to the Company, which Triggering Event Redemption Notice shall indicate the number of the
Preferred Shares such Holder is electing to redeem. Each of the Preferred Shares subject to redemption by the Company pursuant
to this Section 5(b) shall be redeemed by the Company at a price equal to the greater of (i) the product of (A) the Conversion
Amount to be redeemed multiplied by (B) the Redemption Premium and (ii) the product of (X) the Conversion Rate (with “Alternate
Conversion Price” replacing “Conversion Price” for all purposes hereunder with respect thereto and with “Redemption
Premium of the Conversion Amount” replacing “Conversion Amount” in clause (x) of the definition of Conversion
Rate above with respect thereto) with respect to the Conversion Amount in effect at such time as such Holder delivers a Triggering
Event Redemption Notice multiplied by (Y) the product of (1) the Redemption Premium multiplied by (2) the greatest Closing Sale
Price of the Common Stock on any Trading Day during the period commencing on the date immediately preceding such Triggering Event
and ending on the date the Company makes the entire payment required to be made under this Section 5(b) (the “Triggering
Event Redemption Price”). Redemptions required by this Section 5(b) shall be made in accordance with the provisions
of Section 11. To the extent redemptions required by this Section 5(b) are deemed or determined by a court of competent jurisdiction
to be prepayments of the Preferred Shares by the Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding
anything to the contrary in this Section 5(b), but subject to Section 4(d), until the Triggering Event Redemption Price (together
with any Late Charges thereon) is paid in full, the Conversion Amount submitted for redemption under this Section 5(b) (together
with any Late Charges thereon) may be converted, in whole or in part, by such Holder into Common Stock pursuant to the terms of
this Certificate of Designations. In the event of the Company’s redemption of any of the Preferred Shares under this Section
5(b), a Holder’s damages would be uncertain and difficult to estimate because of the parties’ inability to predict
future interest rates and the uncertainty of the availability of a suitable substitute investment opportunity for such Holder.
Accordingly, any redemption premium due under this Section 5(b) is intended by the parties to be, and shall be deemed, a reasonable
estimate of such Holder’s actual loss of its investment opportunity and not as a penalty. Any redemption upon a Triggering
Event shall not constitute an election of remedies by the applicable Holder or any other Holder, and all other rights and remedies
of each Holder shall be preserved.

 

(c)
Mandatory Redemption upon Bankruptcy Triggering Event. Notwithstanding anything to the contrary herein, and notwithstanding
any conversion that is then required or in process, upon any Bankruptcy Triggering Event, the Company shall immediately redeem,
in cash, each of the Preferred Shares then outstanding at a redemption price equal to the applicable Triggering Event Redemption
Price (calculated as if such Holder shall have delivered the Triggering Event Redemption Notice immediately prior to the occurrence
of such Bankruptcy Triggering Event), without the requirement for any notice or demand or other action by any Holder or any other
person or entity, provided that a Holder may, in its sole discretion, waive such right to receive payment upon a Bankruptcy Triggering
Event, in whole or in part, and any such waiver shall not affect any other rights of such Holder or any other Holder hereunder,
including any other rights in respect of such Bankruptcy Triggering Event, any right to conversion, and any right to payment of
such Triggering Event Redemption Price or any other Redemption Price, as applicable.

 

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6.
Rights Upon Fundamental Transactions.

 

(a)
Assumption. The Company shall not enter into or be party to a Fundamental Transaction unless (i) the Successor Entity assumes
in writing all of the obligations of the Company under this Certificate of Designations and the other Transaction Documents in
accordance with the provisions of this Section 6(a) pursuant to written agreements in form and substance satisfactory to the Required
Holders and approved by the Required Holders prior to such Fundamental Transaction, including agreements to deliver to each holder
of Preferred Shares in exchange for such Preferred Shares a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Certificate of Designations, including, without limitation, having a stated
value and dividend rate equal to the stated value and dividend rate of the Preferred Shares held by the Holders and having similar
ranking to the Preferred Shares, and satisfactory to the Required Holders and (ii) the Successor Entity (including its Parent
Entity) is a publicly traded corporation whose shares of common stock are quoted on or listed for trading on an Eligible Market.
Upon the occurrence of any Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from
and after the date of such Fundamental Transaction, the provisions of this Certificate of Designations 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 Certificate of Designations and the other
Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein and therein. In addition
to the foregoing, upon consummation of a Fundamental Transaction, the Successor Entity shall deliver to each Holder confirmation
that there shall be issued upon conversion or redemption of the Preferred Shares at any time after the consummation of such Fundamental
Transaction, in lieu of the shares of Common Stock (or other securities, cash, assets or other property (except such items still
issuable under Sections 7 and 15, which shall continue to be receivable thereafter)) issuable upon the conversion or redemption
of the Preferred Shares prior to such Fundamental Transaction, such shares of the publicly traded common stock (or their equivalent)
of the Successor Entity (including its Parent Entity) which each Holder would have been entitled to receive upon the happening
of such Fundamental Transaction had all the Preferred Shares held by each Holder been converted immediately prior to such Fundamental
Transaction (without regard to any limitations on the conversion of the Preferred Shares contained in this Certificate of Designations),
as adjusted in accordance with the provisions of this Certificate of Designations. Notwithstanding the foregoing, such Holder
may elect, at its sole option, by delivery of written notice to the Company to waive this Section 6(a) to permit the Fundamental
Transaction without the assumption of the Preferred Shares. The provisions of this Section 6 shall apply similarly and equally
to successive Fundamental Transactions and shall be applied without regard to any limitations on the conversion or redemption
of the Preferred Shares.

 

    	15

    	 

    

 

(b)
Notice of a Change of Control Redemption Right. No sooner than twenty (20) Trading Days nor later than ten (10) Trading
Days prior to the consummation of a Change of Control (the “Change of Control Date”), but not prior to the
public announcement of such Change of Control, the Company shall deliver written notice thereof via facsimile or electronic mail
and overnight courier to each Holder (a “Change of Control Notice”). At any time during the period beginning
after a Holder’s receipt of a Change of Control Notice or such Holder becoming aware of a Change of Control if a Change
of Control Notice is not delivered to such Holder in accordance with the immediately preceding sentence (as applicable) and ending
on twenty (20) Trading Days after the later of (A) the date of consummation of such Change of Control or (B) the date of receipt
of such Change of Control Notice or (C) the date of the announcement of such Change of Control, such Holder may require the Company
to redeem all or any portion of such Holder’s Preferred Shares by delivering written notice thereof (“Change of
Control Redemption Notice”) to the Company, which Change of Control Redemption Notice shall indicate the number of Preferred
Shares such Holder is electing to have the Company redeem. Each Preferred Share subject to redemption pursuant to this Section
6(b) shall be redeemed by the Company in cash at a price equal to the greatest of (i) the product of (w) the Change of Control
Redemption Premium multiplied by (y) the Conversion Amount of the Preferred Shares being redeemed, (ii) the product of (x) the
Change of Control Redemption Premium multiplied by (y) the product of (A) the Conversion Amount of the Preferred Shares being
redeemed multiplied by (B) the quotient determined by dividing (I) the greatest Closing Sale Price of the shares of Common Stock
during the period beginning on the date immediately preceding the earlier to occur of (1) the consummation of the applicable Change
of Control and (2) the public announcement of such Change of Control and ending on the date such Holder delivers the Change of
Control Redemption Notice by (II) the Conversion Price then in effect and (iii) the product of (y) the Change of Control Redemption
Premium multiplied by (z) the product of (A) the Conversion Amount of the Preferred Shares being redeemed multiplied by (B) the
quotient of (I) the aggregate cash consideration and the aggregate cash value of any non-cash consideration per share of Common
Stock to be paid to such holders of the shares of Common Stock upon consummation of such Change of Control (any such non-cash
consideration constituting publicly-traded securities shall be valued at the highest of the Closing Sale Price of such securities
as of the Trading Day immediately prior to the consummation of such Change of Control, the Closing Sale Price of such securities
on the Trading Day immediately following the public announcement of such proposed Change of Control and the Closing Sale Price
of such securities on the Trading Day immediately prior to the public announcement of such proposed Change of Control) divided
by (II) the Conversion Price then in effect (the “Change of Control Redemption Price”). Redemptions required
by this Section 6(b) shall have priority to payments to all other shareholders of the Company in connection with such Change of
Control. To the extent redemptions required by this Section 6(b) are deemed or determined by a court of competent jurisdiction
to be prepayments of the Preferred Shares by the Company, such redemptions shall be deemed to be voluntary prepayments. Notwithstanding
anything to the contrary in this Section 6(b), but subject to Section 4(d), until the applicable Change of Control Redemption
Price (together with any Late Charges thereon) is paid in full to the applicable Holder, the Preferred Shares submitted by such
Holder for redemption under this Section 6(b) may be converted, in whole or in part, by such Holder into Common Stock pursuant
to Section 4(c) or in the event the Conversion Date is after the consummation of such Change of Control, stock or equity interests
of the Successor Entity substantially equivalent to the Company’s shares of Common Stock pursuant to Section 4(c). In the
event of the Company’s redemption of any of the Preferred Shares under this Section 6(b), such Holder’s damages would
be uncertain and difficult to estimate because of the parties’ inability to predict future interest rates and the uncertainty
of the availability of a suitable substitute investment opportunity for a Holder. Accordingly, any redemption premium due under
this Section 6(b) is intended by the parties to be, and shall be deemed, a reasonable estimate of such Holder’s actual loss
of its investment opportunity and not as a penalty. The Company shall make payment of the applicable Change of Control Redemption
Price concurrently with the consummation of such Change of Control if a Change of Control Redemption Notice is received prior
to the consummation of such Change of Control and within two (2) Trading Days after the Company’s receipt of such notice
otherwise (the “Change of Control Redemption Date”). Redemptions required by this Section 6 shall be made in
accordance with the provisions of Section 11.

 

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7.
Rights Upon Issuance of Purchase Rights and Other Corporate Events.

 

(a)
Purchase Rights. In addition to any adjustments pursuant to Section 8 and Section 15 below, if at any time the Company
grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property
pro rata to all or substantially all of the record holders of any class of Common Stock (the “Purchase Rights”),
then each Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights
which such Holder could have acquired if such Holder had held the number of shares of Common Stock acquirable upon complete conversion
of all the Preferred Shares (without taking into account any limitations or restrictions on the convertibility of the Preferred
Shares and assuming for such purpose that all the Preferred Shares were converted at the Alternate Conversion Price as of the
applicable record date) held by such Holder immediately prior to the date on which a record is taken for the grant, issuance or
sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock
are to be determined for the grant, issue or sale of such Purchase Rights, provided, however, to the extent that such Holder’s
right to participate in any such Purchase Right would result in such Holder and the other Attribution Parties exceeding the Maximum
Percentage, then such Holder shall not be entitled to participate in such Purchase Right to such extent of the Maximum Percentage
(and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Purchase Right (and beneficial
ownership) to such extent of any such excess) and such Purchase Right to such extent shall be held in abeyance (and, if such Purchase
Right has an expiration date, maturity date or other similar provision, such term shall be extended by such number of days held
in abeyance, if applicable) for the benefit of such Holder until such time or times, if ever, as its right thereto would not result
in such Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times such Holder shall be
granted such right (and any Purchase Right granted, issued or sold on such initial Purchase Right or on any subsequent Purchase
Right held similarly in abeyance (and, if such Purchase Right has an expiration date, maturity date or other similar provision,
such term shall be extended by such number of days held in abeyance, if applicable)) to the same extent as if there had been no
such limitation.

 

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(b)
Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation
of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other
assets with respect to or in exchange for shares of Common Stock (a “Corporate Event”), the Company shall make
appropriate provision to ensure that each Holder will thereafter have the right, at such Holder’s option, to receive upon
a conversion of all the Preferred Shares held by such Holder (i) in addition to the shares of Common Stock receivable upon such
conversion, such securities or other assets to which such Holder would have been entitled with respect to such shares of Common
Stock had such shares of Common Stock been held by such Holder upon the consummation of such Corporate Event (without taking into
account any limitations or restrictions on the convertibility of the Preferred Shares set forth in this Certificate of Designations)
or (ii) in lieu of the shares of Common Stock otherwise receivable upon such conversion, such securities or other assets received
by the holders of shares of Common Stock in connection with the consummation of such Corporate Event in such amounts as such Holder
would have been entitled to receive had the Preferred Shares held by such Holder initially been issued with conversion rights
for the form of such consideration (as opposed to shares of Common Stock) at a conversion rate for such consideration commensurate
with the Conversion Rate. Provision made pursuant the preceding sentence shall be in a form and substance satisfactory to the
Required Holders. The provisions of this Section 7 shall apply similarly and equally to successive Corporate Events and shall
be applied without regard to any limitations on the conversion or redemption of the Preferred Shares set forth in this Certificate
of Designations.

 

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8.
Rights Upon Issuance of Other Securities.

 

(a)
Adjustment of Conversion Price upon Issuance of Common Stock. If and whenever on or after the Subscription Date the Company
grants, issues or sells (or enter into any agreement to grant, issue or sell), or in accordance with this Section 8(a) is deemed
to have issued or sold, any shares of Common Stock (including the issuance or sale of shares of Common Stock owned or held by
or for the account of the Company, but excluding any Excluded Securities issued or sold or deemed to have been issued or sold)
for a consideration per share (the “New Issuance Price”) less than a price equal to the Conversion Price in
effect immediately prior to such issuance or sale or deemed issuance or sale (such Conversion Price then in effect is referred
to herein as the “Applicable Price”) (the foregoing a “Dilutive Issuance”), then, immediately
after such Dilutive Issuance, the Conversion Price then in effect shall be reduced to an amount equal to the New Issuance Price.
For all purposes of the foregoing (including, without limitation, determining the adjusted Conversion Price and the New Issuance
Price under this Section 8(a)), the following shall be applicable:

 

(i)
Issuance of Options. If the Company in any manner grants, issues or sells (or enters into any agreement to grant, issue
or sell) any Options and the lowest price per share for which one share of Common Stock is at any time issuable upon the exercise
of any such Option or upon conversion, exercise or exchange of any Convertible Securities issuable upon exercise of any such Option
or otherwise pursuant to the terms thereof is less than the Applicable Price, then such share of Common Stock shall be deemed
to be outstanding and to have been issued and sold by the Company at the time of the granting or sale of such Option for such
price per share. For purposes of this Section 8(a)(i), the “lowest price per share for which one share of Common Stock is
at any time issuable upon the exercise of any such Option or upon conversion, exercise or exchange of any Convertible Securities
issuable upon exercise of any such Option or otherwise pursuant to the terms thereof” shall be equal to (1) the lower of
(x) the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to any one share
of Common Stock upon the granting, issuance or sale of such Option, upon exercise of such Option and upon conversion, exercise
or exchange of any Convertible Security issuable upon exercise of such Option or otherwise pursuant to the terms thereof and (y)
the lowest exercise price set forth in such Option for which one share of Common Stock is issuable (or may become issuable assuming
all possible market conditions) upon the exercise of any such Options or upon conversion, exercise or exchange of any Convertible
Securities issuable upon exercise of any such Option or otherwise pursuant to the terms thereof minus (2) the sum of all amounts
paid or payable to the holder of such Option (or any other Person) with respect to nay one share of Common Stock upon the granting,
issuance or sale of such Option, upon exercise of such Option and upon conversion, exercise or exchange of any Convertible Security
issuable upon exercise of such Option or otherwise pursuant to the terms thereof plus the value of any other consideration consisting
of cash, debt forgiveness, assets or any other property received or receivable by, or benefit conferred on, the holder of such
Option (or any other Person). Except as contemplated below, no further adjustment of the Conversion Price shall be made upon the
actual issuance of such shares of Common Stock or of such Convertible Securities upon the exercise of such Options or otherwise
pursuant to the terms thereof or upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange
of such Convertible Securities.

 

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(ii)
Issuance of Convertible Securities. If the Company in any manner issues or sells (or enters in to any agreement to issue
or sell) any Convertible Securities and the lowest price per share for which one share of Common Stock is at any time issuable
(or may become issuable assuming all possible market conditions) upon the conversion, exercise or exchange thereof or otherwise
pursuant to the terms thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding
and to have been issued and sold by the Company at the time of the issuance or sale of such Convertible Securities for such price
per share. For purposes of this Section 8(a)(ii), the “lowest price per share for which one share of Common Stock is at
any time issuable (or may become issuable assuming all possible market conditions) upon the conversion, exercise or exchange thereof
or otherwise pursuant to the terms thereof” shall be equal to (1) the lower of (x) the sum of the lowest amounts of consideration
(if any) received or receivable by the Company with respect to one share of Common Stock upon the issuance or sale of the Convertible
Security and upon conversion, exercise or exchange of such Convertible Security or otherwise pursuant to the terms thereof and
(y) the lowest conversion price set forth in such Convertible Security for which one share of Common Stock is issuable (or may
become issuable assuming all possible market conditions) upon conversion, exercise or exchange thereof or otherwise pursuant to
the terms thereof minus (2) the sum of all amounts paid or payable to the holder of such Convertible Security (or any other Person)
with respect to any one share of Common Stock upon the issuance or sale of such Convertible Security plus the value of any other
consideration received or receivable consisting of cash, debt forgiveness, assets or other property by, or benefit conferred on,
the holder of such Convertible Security (or any other Person). Except as contemplated below, no further adjustment of the Conversion
Price shall be made upon the actual issuance of such shares of Common Stock upon conversion, exercise or exchange of such Convertible
Securities or otherwise pursuant to the terms thereof, and if any such issuance or sale of such Convertible Securities is made
upon exercise of any Options for which adjustment of the Conversion Price has been or is to be made pursuant to other provisions
of this Section 8(a), except as contemplated below, no further adjustment of the Conversion Price shall be made by reason of such
issuance or sale.

 

(iii)
Change in Option Price or Rate of Conversion. If the purchase or exercise price provided for in any Options, the additional
consideration, if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at
which any Convertible Securities are convertible into or exercisable or exchangeable for shares of Common Stock increases or decreases
at any time (other than proportional changes in conversion or exercise prices, as applicable, in connection with an event referred
to in Section 8(b) below), the Conversion Price in effect at the time of such increase or decrease shall be adjusted to the Conversion
Price which would have been in effect at such time had such Options or Convertible Securities provided for such increased or decreased
purchase price, additional consideration or increased or decreased conversion rate (as the case may be) at the time initially
granted, issued or sold. For purposes of this Section 8(a)(iii), if the terms of any Option or Convertible Security that was outstanding
as of the Subscription Date are increased or decreased in the manner described in the immediately preceding sentence, then such
Option or Convertible Security and the shares of Common Stock deemed issuable upon exercise, conversion or exchange thereof shall
be deemed to have been issued as of the date of such increase or decrease. No adjustment pursuant to this Section 8(a) shall be
made if such adjustment would result in an increase of the Conversion Price then in effect.

 

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(iv)
Calculation of Consideration Received. If any Option and/or Convertible Security and/or Adjustment Right is issued in connection
with the issuance or sale or deemed issuance or sale of any other securities of the Company (as determined by the Required Holders,
the “Primary Security”, and such Option and/or Convertible Security and/or Adjustment Right, the “Secondary
Securities”), together comprising one integrated transaction (or one or more transactions if such issuances or sales
or deemed issuances or sales of securities of the Company either (A) have at least one investor or purchaser in common, (B) are
consummated in reasonable proximity to each other and/or (C) are consummated under the same plan of financing), the consideration
per share of Common Stock with respect to such Primary Security shall be deemed to be equal to the difference of (x) the lowest
price per share for which one share of Common Stock was issued (or was deemed to be issued pursuant to Section 8(a)(i) or 8(a)(ii)
above, as applicable) in such integrated transaction solely with respect to such Primary Security, minus (y) with respect to such
Secondary Securities, the sum of (A) the Black Scholes Consideration Value of each such Option, if any, (B) the fair market value
(as determined by the Required Holders in good faith) or the Black Scholes Consideration Value, as applicable, of such Adjustment
Right, if any, and (C) the fair market value (as determined by the Required Holder) of such Convertible Security, if any, in each
case, as determined on a per share basis in accordance with this Section 8(a)(iv). If any shares of Common Stock, Options or Convertible
Securities are issued or sold or deemed to have been issued or sold for cash, the consideration received therefor (for the purpose
of determining the consideration paid for such Common Stock, Option or Convertible Security, but not for the purpose of the calculation
of the Black Scholes Consideration Value) will be deemed to be the net amount of consideration received by the Company therefor.
If any shares of Common Stock, Options or Convertible Securities are issued or sold for a consideration other than cash, the amount
of such consideration received by the Company (for the purpose of determining the consideration paid for such Common Stock, Option
or Convertible Security, but not for the purpose of the calculation of the Black Scholes Consideration Value), will be the fair
value of such consideration, except where such consideration consists of publicly traded securities, in which case the amount
of consideration received by the Company for such securities will be the arithmetic average of the VWAPs of such security for
each of the five (5) Trading Days immediately preceding the date of receipt. If any shares of Common Stock, Options or Convertible
Securities are issued to the owners of the non-surviving entity in connection with any merger in which the Company is the surviving
entity, the amount of consideration therefor (for the purpose of determining the consideration paid for such Common Stock, Option
or Convertible Security, but not for the purpose of the calculation of the Black Scholes Consideration Value), will be deemed
to be the fair value of such portion of the net assets and business of the non-surviving entity as is attributable to such shares
of Common Stock, Options or Convertible Securities (as the case may be). The fair value of any consideration other than cash or
publicly traded securities will be determined jointly by the Company and the Required Holders. If such parties are unable to reach
agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation Event”),
the fair value of such consideration will be determined within five (5) Trading Days after the tenth (10th) day following
such Valuation Event by an independent, reputable appraiser jointly selected by the Company and the Required Holders. The determination
of such appraiser shall be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser
shall be borne by the Company.

 

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

 

(b)
Adjustment of Conversion Price upon Subdivision or Combination of Common Stock. Without limiting any provision of Section
6 or Section 8(a), if the Company at any time on or after the Subscription Date subdivides (by any stock split, stock dividend,
stock combination, recapitalization or other similar transaction) one or more classes of its outstanding shares of Common Stock
into a greater number of shares, the Conversion Price in effect immediately prior to such subdivision will be proportionately
reduced. Without limiting any provision of Section 6 or Section 8(a), if the Company at any time on or after the Subscription
Date combines (by any stock split, stock dividend, stock combination, recapitalization or other similar transaction) one or more
classes of its outstanding shares of Common Stock into a smaller number of shares, the Conversion Price in effect immediately
prior to such combination will be proportionately increased. Any adjustment pursuant to this Section 8(b) shall become effective
immediately after the effective date of such subdivision or combination. If any event requiring an adjustment under this Section
8(b) occurs during the period that a Conversion Price is calculated hereunder, then the calculation of such Conversion Price shall
be adjusted appropriately to reflect such event.

 

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(c)
Holder’s Right of Adjusted Conversion Price. In addition to and not in limitation of the other provisions of this
Section 8(b), if the Company in any manner issues or sells or enters into (whether initially or pursuant to any subsequent amendment
thereof) any agreement to issue or sell, any Common Stock, Options or Convertible Securities (any such securities, “Variable
Price Securities”) after the Subscription Date that are issuable pursuant to such agreement or convertible into or exchangeable
or exercisable for shares of Common Stock at a price which varies or may vary with the market price of the shares of Common Stock,
including by way of one or more reset(s) to a fixed price, but exclusive of such formulations reflecting customary anti-dilution
provisions (such as share splits, share combinations, share dividends and similar transactions) (each of the formulations for
such variable price being herein referred to as, the “Variable Price”), the Company shall provide written notice
thereof via facsimile or electronic mail and overnight courier to each Holder on the date of such agreement and/or the issuance
of such shares of Common Stock, Convertible Securities or Options, as applicable. From and after the date the Company enters into
such agreement or issues any such Variable Price Securities, each Holder shall have the right, but not the obligation, in its
sole discretion to substitute the Variable Price for the Conversion Price upon conversion of the Preferred Shares by designating
in the Conversion Notice delivered upon any conversion of Preferred Shares that solely for purposes of such conversion such Holder
is relying on the Variable Price rather than the Conversion Price then in effect. A Holder’s election to rely on a Variable
Price for a particular conversion of Preferred Shares shall not obligate such Holder to rely on a Variable Price for any future
conversions of Preferred Shares.

 

(d)
Stock Combination Event Adjustments. If at any time and from time to time on or after the Subscription Date there occurs
any stock split, stock dividend, stock combination recapitalization or other similar transaction involving the Common Stock (each,
a “Stock Combination Event”, and such date thereof, the “Stock Combination Event Date”)
and the Event Market Price is less than the Conversion Price then in effect (after giving effect to the adjustment in Section
8(b) above), then on the sixteenth (16th) Trading Day immediately following such Stock Combination Event Date, the Conversion
Price then in effect on such sixteenth (16th) Trading Day (after giving effect to the adjustment in Section 88(b) above) shall
be reduced (but in no event increased) to the Event Market Price. For the avoidance of doubt, if the adjustment in the immediately
preceding sentence would otherwise result in an increase in the Conversion Price hereunder, no adjustment shall be made.

 

(e)
Other Events. In the event that the Company (or any Subsidiary) shall take any action to which the provisions hereof are
not strictly applicable, or, if applicable, would not operate to protect any Holder from dilution (other than with respect to
Excluded Securities) or if any event occurs of the type contemplated by the provisions of this Section 8 but not expressly provided
for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights or other
rights with equity features), then the Board shall in good faith determine and implement an appropriate adjustment in the Conversion
Price so as to protect the rights of such Holder, provided that no such adjustment pursuant to this Section 8(b) will increase
the Conversion Price as otherwise determined pursuant to this Section 8, provided further that if such Holder does not accept
such adjustments as appropriately protecting its interests hereunder against such dilution, then the Board and such Holder shall
agree, in good faith, upon an independent investment bank of nationally recognized standing to make such appropriate adjustments,
whose determination shall be final and binding absent manifest error and whose fees and expenses shall be borne by the Company.

 

(f)
Calculations. All calculations under this Section 8 shall be made by rounding to the nearest cent or the nearest 1/100th
of a share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned
or held by or for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Common
Stock.

 

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(g)
Voluntary Adjustment by Company. Subject to the rules and regulations of the Principal Market, the Company may at any time
any Preferred Shares remain outstanding, with the prior written consent of the Required Holders, reduce the then current Conversion
Price to any amount and for any period of time deemed appropriate by the Board.

 

9.
Noncircumvention. The Company hereby covenants and agrees that the Company will not, by amendment of its Articles of Incorporation,
Bylaws (as defined in the Securities Purchase Agreement) or through any reorganization, transfer of assets, consolidation, merger,
scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Certificate of Designations, and will at all times in good faith carry out all the
provisions of this Certificate of Designations and take all action as may be required to protect the rights of the Holders hereunder.
Without limiting the generality of the foregoing or any other provision of this Certificate of Designations or the other Transaction
Documents, the Company (a) shall not increase the par value of any shares of Common Stock receivable upon the conversion of any
Preferred Shares above the Conversion Price then in effect, (b) shall take all such actions as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and non-assessable shares of Common Stock upon the conversion
of Preferred Shares and (c) shall, so long as any Preferred Shares are outstanding, take all action necessary to reserve and keep
available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the conversion of the
Preferred Shares, the maximum number of shares of Common Stock as shall from time to time be necessary to effect the conversion
of the Preferred Shares then outstanding (without regard to any limitations on conversion contained herein). Notwithstanding anything
herein to the contrary, if after the sixty (60) calendar day anniversary of the Initial Issuance Date, each Holder is not permitted
to convert such Holder’s Preferred Shares in full for any reason (other than pursuant to restrictions set forth in Section
4(d)(i) hereof), the Company shall use its reasonable best efforts to promptly remedy such failure, including, without limitation,
obtaining such consents or approvals as necessary to effect such conversion into shares of Common Stock.

 

10.
Authorized Shares.

 

(a)
Reservation. So long as any Preferred Shares remain outstanding, the Company shall (i) on or prior to the Share Increase
Shareholder Approval Date (as defined in the Securities Purchase Agreement), reserve 3,852,879 shares of Common Stock (the “Initial
Reserve Amount”) for issuance pursuant to this Certificate of Designations (and/or the Common Warrants, as designated
from time to time in writing by a Holder with respect to such Holder’s Authorized Share Allocation (as defined below) and
not with respect to any other Holder’s Authorized Share Allocation) and (ii) after the Share Increase Shareholder Approval
Date, at all times reserve at least 200% of the number of shares of Common Stock as shall from time to time be necessary to effect
the conversion, including without limitation, Alternate Conversions of all of the Preferred Shares then outstanding (without regard
to any limitations on conversions) (the “Subsequent Reserve Amount”, and together with the Initial Reserve
Amount, as applicable, the “Required Reserve Amount”). The Required Reserve Amount (including, without limitation,
each increase in the number of shares so reserved) shall be allocated pro rata among the Holders based on the number of the Preferred
Shares held by each Holder on the Initial Issuance Date or increase in the number of reserved shares, as the case may be (the
“Authorized Share Allocation”). In the event that a Holder shall sell or otherwise transfer any of such Holder’s
Preferred Shares, each transferee shall be allocated a pro rata portion of such Holder’s Authorized Share Allocation. Any
shares of Common Stock reserved and allocated to any Person which ceases to hold any Preferred Shares shall be allocated to the
remaining Holders of Preferred Shares, pro rata based on the number of the Preferred Shares then held by the Holders.

 

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(b)
Insufficient Authorized Shares. If, notwithstanding Section 10(a) and not in limitation thereof, at any time while any
of the Preferred Shares remain outstanding the Company does not have a sufficient number of authorized and unreserved shares of
Common Stock to satisfy its obligation to reserve for issuance upon conversion of the Preferred Shares at least a number of shares
of Common Stock equal to the Required Reserve Amount (an “Authorized Share Failure”), then the Company shall
immediately take all action necessary to increase the Company’s authorized shares of Common Stock to an amount sufficient
to allow the Company to reserve the Required Reserve Amount for the Preferred Shares then outstanding (or deemed outstanding pursuant
to Section 10(a) above). Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the
occurrence of an Authorized Share Failure, but in no event later than ninety (90) days after the occurrence of such Authorized
Share Failure, the Company shall hold a meeting of its shareholders for the approval of an increase in the number of authorized
shares of Common Stock. In connection with such meeting, the Company shall provide each shareholder with a proxy statement and
shall use its reasonable best efforts to solicit its shareholders’ approval of such increase in authorized shares of Common
Stock and to cause its board of directors to recommend to the shareholders that they approve such proposal (or, if a majority
of the voting power then in effect of the capital stock of the Company consents to such increase, in lieu of such proxy statement,
deliver to the shareholders of the Company an information statement that has been filed with (and either approved by or not subject
to comments from) the SEC with respect thereto). In the event that the Company is prohibited from issuing shares of Common Stock
to a Holder upon any conversion due to the failure by the Company to have sufficient shares of Common Stock available out of the
authorized but unissued shares of Common Stock (such unavailable number of shares of Common Stock, the “Authorized Failure
Shares”), in lieu of delivering such Authorized Failure Shares to such Holder, the Company shall pay cash in exchange
for the redemption of such portion of the Conversion Amount of the Preferred Shares convertible into such Authorized Failure Shares
at a price equal to the sum of (i) the product of (x) such number of Authorized Failure Shares and (y) the greatest Closing Sale
Price of the Common Stock on any Trading Day during the period commencing on the date such Holder delivers the applicable Conversion
Notice with respect to such Authorized Failure Shares to the Company and ending on the date of such issuance and payment under
this Section 10(a); and (ii) to the extent such Holder purchases (in an open market transaction or otherwise) shares of Common
Stock to deliver in satisfaction of a sale by such Holder of Authorized Failure Shares, any brokerage commissions and other out-of-pocket
expenses, if any, of such Holder incurred in connection therewith. Nothing contained in Section 10(a) or this Section 10(b) shall
limit any obligations of the Company under any provision of the Securities Purchase Agreement.

 

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11.
Redemptions.

 

(a)
General. If a Holder has submitted a Triggering Event Redemption Notice in accordance with Section 5(b), the Company shall
deliver the applicable Triggering Event Redemption Price to such Holder in cash within five (5) Business Days after the Company’s
receipt of such Holder’s Triggering Event Redemption Notice. If a Holder has submitted a Change of Control Redemption Notice
in accordance with Section 6(b), the Company shall deliver the applicable Change of Control Redemption Price to such Holder in
cash concurrently with the consummation of such Change of Control if such notice is received prior to the consummation of such
Change of Control and within five (5) Business Days after the Company’s receipt of such notice otherwise. Notwithstanding
anything herein to the contrary, in connection with any redemption hereunder at a time a Holder is entitled to receive a cash
payment under any of the other Transaction Documents, at the option of such Holder delivered in writing to the Company, the applicable
Redemption Price hereunder shall be increased by the amount of such cash payment owed to such Holder under such other Transaction
Document and, upon payment in full or conversion in accordance herewith, shall satisfy the Company’s payment obligation
under such other Transaction Document. In the event of a redemption of less than all of the Preferred Shares, the Company shall
promptly cause to be issued and delivered to such Holder a new Preferred Share Certificate (in accordance with Section 18) (or
evidence of the creation of a new Book-Entry) representing the number of Preferred Shares which have not been redeemed. In the
event that the Company does not pay the applicable Redemption Price to a Holder within the time period required for any reason
(including, without limitation, to the extent such payment is prohibited pursuant to the NRS), at any time thereafter and until
the Company pays such unpaid Redemption Price in full, such Holder shall have the option, in lieu of redemption, to require the
Company to promptly return to such Holder all or any of the Preferred Shares that were submitted for redemption and for which
the applicable Redemption Price (together with any Late Charges thereon) has not been paid. Upon the Company’s receipt of
such notice, (x) the applicable Redemption Notice shall be null and void with respect to such Preferred Shares, (y) the Company
shall immediately return the applicable Preferred Share Certificate, or issue a new Preferred Share Certificate (in accordance
with Section 18(d)), to such Holder (unless the Preferred Shares are held in Book-Entry form, in which case the Company shall
deliver evidence to such Holder that a Book-Entry for such Preferred Shares then exists), and in each case the Additional Amount
of such Preferred Shares shall be increased by an amount equal to the difference between (1) the applicable Redemption Price (as
the case may be, and as adjusted pursuant to this Section 11, if applicable) minus (2) the Stated Value portion of the Conversion
Amount submitted for redemption and (z) the Conversion Price of such Preferred Shares shall be automatically adjusted with respect
to each conversion effected thereafter by such Holder to the lowest of (A) the Conversion Price as in effect on the date on which
the applicable Redemption Notice is voided, (B) the greater of (x) the Floor Price and (y) 75% of the lowest Closing Bid Price
of the Common Stock during the period beginning on and including the date on which the applicable Redemption Notice is delivered
to the Company and ending on and including the date on which the applicable Redemption Notice is voided and (C) the greater of
(x) the Floor Price and (y) 75% of the quotient of (I) the sum of the five (5) lowest VWAPs of the Common Stock during the twenty
(20) consecutive Trading Day period ending and including the applicable Conversion Date divided by (II) five (5) (it being understood
and agreed that all such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination
or other similar transaction during such period); provided that in the event of the Conversion Floor Price Condition, on the applicable
Conversion Date in connection herewith the Company shall also deliver to the Holder the applicable Redemption Conversion Floor
Amount in cash on the applicable Conversion Date. A Holder’s delivery of a notice voiding a Redemption Notice and exercise
of its rights following such notice shall not affect the Company’s obligations to make any payments of Late Charges which
have accrued prior to the date of such notice with respect to the Preferred Shares subject to such notice.

 

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(b)
Redemption by Multiple Holders. Upon the Company’s receipt of a Redemption Notice from any Holder for redemption
or repayment as a result of an event or occurrence substantially similar to the events or occurrences described in Section 5(b)
or Section 6(b), the Company shall immediately, but no later than one (1) Business Day of its receipt thereof, forward to each
other Holder by facsimile or electronic mail a copy of such notice. If the Company receives one or more Redemption Notices, during
the seven (7) Business Day period beginning on and including the date which is two (2) Business Days prior to the Company’s
receipt of the initial Redemption Notice and ending on and including the date which is two (2) Business Days after the Company’s
receipt of the initial Redemption Notice and the Company is unable to redeem all of the Conversion Amount of such Preferred Shares
designated in such initial Redemption Notice and such other Redemption Notices received during such seven (7) Business Day period,
then the Company shall redeem a pro rata amount from each Holder based on the Stated Value of the Preferred Shares submitted for
redemption pursuant to such Redemption Notices received by the Company during such seven (7) Business Day period.

 

12.
Voting Rights. Holders of Preferred Shares shall have no voting rights, except as required by law (including without limitation,
the NRS) and as expressly provided in this Certificate of Designations. To the extent that under the NRS the vote of the holders
of the Preferred Shares, voting separately as a class or series, as applicable, is required to authorize a given action of the
Company, the affirmative vote or consent of the Required Holders of the shares of the Preferred Shares, voting together in the
aggregate and not in separate series unless required under the NRS, represented at a duly held meeting at which a quorum is presented
or by written consent of the Required Holders (except as otherwise may be required under the NRS), voting together in the aggregate
and not in separate series unless required under the NRS, shall constitute the approval of such action by both the class or the
series, as applicable. Subject to Section 4(d)(i), to the extent that under the NRS holders of the Preferred Shares are entitled
to vote on a matter with holders of shares of Common Stock, voting together as one class, each Preferred Share shall entitle the
holder thereof to cast that number of votes per share as is equal to the number of shares of Common Stock into which it is then
convertible (subject to the ownership limitations specified in Section 4(d)(i) hereof) using the record date for determining the
stockholders of the Company eligible to vote on such matters as the date as of which the Conversion Price is calculated. Holders
of the Preferred Shares shall be entitled to written notice of all stockholder meetings or written consents (and copies of proxy
materials and other information sent to stockholders) with respect to which they would be entitled to vote, which notice would
be provided pursuant to the Company’s bylaws and the NRS.

 

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13.
Covenants.

 

(a)
Incurrence of Indebtedness. So long as the Minimum Ownership Condition (as defined in the Securities Purchase Agreement)
exists, the Company shall not, and the Company shall cause each of its Subsidiaries to not, directly or indirectly, incur or guarantee,
assume or suffer to exist any Indebtedness (other than Permitted Indebtedness).

 

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

 

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

 

(d)
Restriction on Redemption and Cash Dividends. The Company shall not, and the Company shall cause each of its Subsidiaries
to not, directly or indirectly, redeem, repurchase or declare or pay any cash dividend or distribution on any of its capital stock
(other than as required by the Certificate of Designations).

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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(l)
Transactions with Affiliates. Other than the Insider Financing (as defined in the Securities Purchase Agreement) and the
transactions described on Schedule 13(l) attached hereto, the Company shall not, nor shall it permit any of its Subsidiaries
to, enter into, renew, extend or be a party to, any transaction or series of related transactions (including, without limitation,
the purchase, sale, lease, transfer or exchange of property or assets of any kind or the rendering of services of any kind) with
any affiliate, except transactions in the ordinary course of business in a manner and to an extent consistent with past practice
and necessary or desirable for the prudent operation of its business, for fair consideration and on terms no less favorable to
it or its Subsidiaries than would be obtainable in a comparable arm’s length transaction with a Person that is not an affiliate
thereof.

 

(m)
Restricted Issuances. The Company shall not, directly or indirectly, without the prior written consent of the Required
Holders, (i) issue any Preferred Shares (other than as contemplated by the Securities Purchase Agreement and this Certificate
of Designations) or (ii) issue any other securities that would cause a breach or default under this Certificate of Designations,
the Preferred Warrants or the Common Warrants.

 

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

 

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14.
Liquidation, Dissolution, Winding-Up. In the event of a Liquidation Event, the Holders shall be entitled to receive in
cash out of the assets of the Company, whether from capital or from earnings available for distribution to its shareholders (the
“Liquidation Funds”), before any amount shall be paid to the holders of any of shares of Junior Stock, but
pari passu with any Parity Stock then outstanding, an amount per Preferred Share equal to the greater of (A) 125% of the Conversion
Amount of such Preferred Share on the date of such payment and (B) the amount per share such Holder would receive if such Holder
converted such Preferred Share into Common Stock immediately prior to the date of such payment, provided that if the Liquidation
Funds are insufficient to pay the full amount due to the Holders and holders of shares of Parity Stock, then each Holder and each
holder of Parity Stock shall receive a percentage of the Liquidation Funds equal to the full amount of Liquidation Funds payable
to such Holder and such holder of Parity Stock as a liquidation preference, in accordance with their respective certificate of
designations (or equivalent), as a percentage of the full amount of Liquidation Funds payable to all holders of Preferred Shares
and all holders of shares of Parity Stock. To the extent necessary, the Company shall cause such actions to be taken by each of
its Subsidiaries so as to enable, to the maximum extent permitted by law, the proceeds of a Liquidation Event to be distributed
to the Holders in accordance with this Section 14. All the preferential amounts to be paid to the Holders under this Section 14
shall be paid or set apart for payment before the payment or setting apart for payment of any amount for, or the distribution
of any Liquidation Funds of the Company to the holders of shares of Junior Stock in connection with a Liquidation Event as to
which this Section 14 applies.

 

15.
Distribution of Assets. In addition to any adjustments pursuant to Section 7(a) and Section 8, if the Company shall declare
or make any dividend or other distributions of its assets (or rights to acquire its assets) to any or all holders of shares of
Common Stock, by way of return of capital or otherwise (including without limitation, any distribution of cash, stock or other
securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement
or other similar transaction) (the “Distributions”), then each Holder, as holders of Preferred Shares, will
be entitled to such Distributions as if such Holder had held the number of shares of Common Stock acquirable upon complete conversion
of the Preferred Shares (without taking into account any limitations or restrictions on the convertibility of the Preferred Shares
and assuming for such purpose that the Preferred Share was converted at the Alternate Conversion Price as of the applicable record
date) immediately prior to the date on which a record is taken for such Distribution or, if no such record is taken, the date
as of which the record holders of Common Stock are to be determined for such Distributions (provided, however, that
to the extent that such Holder’s right to participate in any such Distribution would result in such Holder and the other
Attribution Parties exceeding the Maximum Percentage, then such Holder shall not be entitled to participate in such Distribution
to such extent of the Maximum Percentage (and shall not be entitled to beneficial ownership of such shares of Common Stock as
a result of such Distribution (and beneficial ownership) to such extent of any such excess) and the portion of such Distribution
shall be held in abeyance for the benefit of such Holder until such time or times as its right thereto would not result in such
Holder and the other Attribution Parties exceeding the Maximum Percentage, at which time or times, if any, such Holder shall be
granted such Distribution (and any Distributions declared or made on such initial Distribution or on any subsequent Distribution
held similarly in abeyance) to the same extent as if there had been no such limitation).

 

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16.
Vote to Change the Terms of or Issue Preferred Shares. In addition to any other rights provided by law, except where the
vote or written consent of the holders of a greater number of shares is required by law or by another provision of the Articles
of Incorporation, without first obtaining the affirmative vote at a meeting duly called for such purpose or the written consent
without a meeting of the Required Holders, voting together as a single class, the Company shall not: (a) amend or repeal any provision
of, or add any provision to, its Articles of Incorporation or bylaws, or file any certificate of designations or articles of amendment
of any series of shares of preferred stock, if such action would adversely alter or change in any respect the preferences, rights,
privileges or powers, or restrictions provided for the benefit of the Preferred Shares hereunder, regardless of whether any such
action shall be by means of amendment to the Articles of Incorporation or by merger, consolidation or otherwise; (b) increase
or decrease (other than by conversion) the authorized number of Preferred Shares; (c) without limiting any provision of Section
2, create or authorize (by reclassification or otherwise) any new class or series of Senior Preferred Stock or Parity Stock; (d)
purchase, repurchase or redeem any shares of Junior Stock (other than pursuant to the terms of the Company’s equity incentive
plans and options and other equity awards granted under such plans (that have in good faith been approved by the Board)); (e)
without limiting any provision of Section 2, pay dividends or make any other distribution on any shares of any Junior Stock; (f)
issue any Preferred Shares other than as contemplated hereby or pursuant to the Securities Purchase Agreement; or (g) without
limiting any provision of Section 9, whether or not prohibited by the terms of the Preferred Shares, circumvent a right of the
Preferred Shares hereunder.

 

17.
Transfer of Preferred Shares. A Holder may transfer some or all of its Preferred Shares without the consent of the Company.

 

18.
Reissuance of Preferred Share Certificates and Book Entries.

 

(a)
Transfer. If any Preferred Shares are to be transferred, the applicable Holder shall surrender the applicable Preferred
Share Certificate to the Company (or, if the Preferred Shares are held in Book-Entry form, a written instruction letter to the
Company), whereupon the Company will forthwith issue and deliver upon the order of such Holder a new Preferred Share Certificate
(in accordance with Section 18(d)) (or evidence of the transfer of such Book-Entry), registered as such Holder may request, representing
the outstanding number of Preferred Shares being transferred by such Holder and, if less than the entire outstanding number of
Preferred Shares is being transferred, a new Preferred Share Certificate (in accordance with Section 18(d)) to such Holder representing
the outstanding number of Preferred Shares not being transferred (or evidence of such remaining Preferred Shares in a Book-Entry
for such Holder). Such Holder and any assignee, by acceptance of the Preferred Share Certificate or evidence of Book-Entry issuance,
as applicable, acknowledge and agree that, by reason of the provisions of Section 4(c)(i) following conversion or redemption of
any of the Preferred Shares, the outstanding number of Preferred Shares represented by the Preferred Shares may be less than the
number of Preferred Shares stated on the face of the Preferred Shares.

 

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

 

(c)
Preferred Share Certificate and Book-Entries Exchangeable for Different Denominations and Forms. Each Preferred Share Certificate
is exchangeable, upon the surrender hereof by the applicable Holder at the principal office of the Company, for a new Preferred
Share Certificate or Preferred Share Certificate(s) or new Book-Entry (in accordance with Section 18(d)) representing, in the
aggregate, the outstanding number of the Preferred Shares in the original Preferred Share Certificate, and each such new Preferred
Share Certificate and/or new Book-Entry, as applicable, will represent such portion of such outstanding number of Preferred Shares
from the original Preferred Share Certificate as is designated in writing by such Holder at the time of such surrender. Each Book-Entry
may be exchanged into one or more new Preferred Share Certificates or split by the applicable Holder by delivery of a written
notice to the Company into two or more new Book-Entries (in accordance with Section 18(d)) representing, in the aggregate, the
outstanding number of the Preferred Shares in the original Book-Entry, and each such new Book-Entry and/or new Preferred Share
Certificate, as applicable, will represent such portion of such outstanding number of Preferred Shares from the original Book-Entry
as is designated in writing by such Holder at the time of such surrender.

 

(d)
Issuance of New Preferred Share Certificate or Book-Entry. Whenever the Company is required to issue a new Preferred Share
Certificate or a new Book-Entry pursuant to the terms of this Certificate of Designations, such new Preferred Share Certificate
or new Book-Entry (i) shall represent, as indicated on the face of such Preferred Share Certificate or in such Book-Entry, as
applicable, the number of Preferred Shares remaining outstanding (or in the case of a new Preferred Share Certificate or new Book-Entry
being issued pursuant to Section 18(a) or Section 18(c), the number of Preferred Shares designated by such Holder) which, when
added to the number of Preferred Shares represented by the other new Preferred Share Certificates or other new Book-Entry, as
applicable, issued in connection with such issuance, does not exceed the number of Preferred Shares remaining outstanding under
the original Preferred Share Certificate or original Book-Entry, as applicable, immediately prior to such issuance of new Preferred
Share Certificate or new Book-Entry, as applicable, and (ii) shall have an issuance date, as indicated on the face of such new
Preferred Share Certificate or in such new Book-Entry, as applicable, which is the same as the issuance date of the original Preferred
Share Certificate or in such original Book-Entry, as applicable.

 

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19.
Remedies, Characterizations, Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate
of Designations shall be cumulative and in addition to all other remedies available under this Certificate of Designations 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 any Holder’s right to pursue actual and consequential damages for any failure by
the Company to comply with the terms of this Certificate of Designations. The Company covenants to each 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 a Holder
and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof).
No failure on the part of a Holder to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise by such Holder of any right, power or remedy preclude any other
or further exercise thereof or the exercise of any other right, power or remedy. In addition, the exercise of any right or remedy
of any Holder at law or equity or under Preferred Shares or any of the documents shall not be deemed to be an election of such
Holder’s rights or remedies under such documents or at law or equity. The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Holders 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, each Holder shall be entitled, in addition
to all other available remedies, to specific performance and/or temporary, preliminary and permanent injunctive or other equitable
relief from any court of competent jurisdiction in any such case without the necessity of proving actual damages and without posting
a bond or other security. The Company shall provide all information and documentation to a Holder that is requested by such Holder
to enable such Holder to confirm the Company’s compliance with the terms and conditions of this Certificate of Designations.

 

20.
Payment of Collection, Enforcement and Other Costs. If (a) any Preferred Shares are placed in the hands of an attorney
for collection or enforcement or is collected or enforced through any legal proceeding or a Holder otherwise takes action to collect
amounts due under this Certificate of Designations with respect to the Preferred Shares or to enforce the provisions of this Certificate
of Designations or (b) there occurs any bankruptcy, reorganization, receivership of the Company or other proceedings affecting
Company creditors’ rights and involving a claim under this Certificate of Designations, then the Company shall pay the costs
incurred by such Holder for such collection, enforcement or action or in connection with such bankruptcy, reorganization, receivership
or other proceeding, including, without limitation, attorneys’ fees and disbursements. The Company expressly acknowledges
and agrees that no amounts due under this Certificate of Designations with respect to any Preferred Shares shall be affected,
or limited, by the fact that the purchase price paid for each Preferred Share was less than the original Stated Value thereof.

 

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

 

22.
Failure or Indulgence Not Waiver. No failure or delay on the part of a Holder in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privilege. No waiver shall be effective unless it is in writing
and signed by an authorized representative of the waiving party. This Certificate of Designations shall be deemed to be jointly
drafted by the Company and all Holders and shall not be construed against any Person as the drafter hereof. Notwithstanding the
foregoing, nothing contained in this Section 22 shall permit any waiver of any provision of Section 4(d).

 

23.
Dispute Resolution.

 

(a)
Submission to Dispute Resolution.

 

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

 

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

 

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

 

(b)
Miscellaneous. The Company expressly acknowledges and agrees that (i) this Section 23 constitutes an agreement to arbitrate
between the Company and each Holder (and constitutes an arbitration agreement) under § 7501, et seq. of the New York Civil
Practice Law and Rules (“CPLR”) and that any Holder is authorized to apply for an order to compel arbitration
pursuant to CPLR § 7503(a) in order to compel compliance with this Section 23, (ii) a dispute relating to a Conversion Price
includes, without limitation, disputes as to (A) whether an issuance or sale or deemed issuance or sale of Common Stock occurred
under Section 8(a), (B) the consideration per share at which an issuance or deemed issuance of Common Stock occurred, (C) whether
any issuance or sale or deemed issuance or sale of Common Stock was an issuance or sale or deemed issuance or sale of Excluded
Securities, (D) whether an agreement, instrument, security or the like constitutes and Option or Convertible Security and (E)
whether a Dilutive Issuance occurred, (iii) the terms of this Certificate of Designations and each other applicable Transaction
Document shall serve as the basis for the selected investment bank’s resolution of the applicable dispute, such investment
bank shall be entitled (and is hereby expressly authorized) to make all findings, determinations and the like that such investment
bank determines are required to be made by such investment bank in connection with its resolution of such dispute and in resolving
such dispute such investment bank shall apply such findings, determinations and the like to the terms of this Certificate of Designations
and any other applicable Transaction Documents, (iv) the applicable Holder (and only such Holder with respect to disputes solely
relating to such Holder), in its sole discretion, shall have the right to submit any dispute described in this Section 23 to any
state or federal court sitting in The City of New York, Borough of Manhattan in lieu of utilizing the procedures set forth in
this Section 23 and (v) nothing in this Section 23 shall limit such Holder from obtaining any injunctive relief or other equitable
remedies (including, without limitation, with respect to any matters described in this Section 23).

 

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24.
Notices; Currency; Payments.

 

(a)
Notices. The Company shall provide each Holder of Preferred Shares with prompt written notice of all actions taken pursuant
to the terms of this Certificate of Designations, including in reasonable detail a description of such action and the reason therefor.
Whenever notice is required to be given under this Certificate of Designations, unless otherwise provided herein, such notice
must be in writing and shall be given in accordance with Section 9(f) of the Securities Purchase Agreement. The Company shall
provide each Holder with prompt written notice of all actions taken pursuant to this Certificate of Designations, including in
reasonable detail a description of such action and the reason therefore. Without limiting the generality of the foregoing, the
Company shall give written notice to each Holder (i) immediately upon any adjustment of the Conversion Price, setting forth in
reasonable detail, and certifying, the calculation of such adjustment and (ii) at least fifteen (15) days prior to the date on
which the Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Common Stock, (B)
with respect to any grant, issuances, or sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities
or other property to 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 such Holder.

 

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

 

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(c)
Payments. Whenever any payment of cash is to be made by the Company to any Person pursuant to this Certificate of Designations,
unless otherwise expressly set forth herein, such payment shall be made in lawful money of the United States of America by wire
transfer of immediately available funds pursuant to wire transfer instructions that Holder shall provide to the Company in writing
from time to time. Whenever any amount expressed to be due by the terms of this Certificate of Designations is due on any day
which is not a Business Day, the same shall instead be due on the next succeeding day which is a Business Day. Any amount due
under the Transaction Documents which is not paid when due shall result in a late charge being incurred and payable by the Company
in an amount equal to interest on such amount at the rate of fifteen percent (15%) per annum from the date such amount was due
until the same is paid in full (“Late Charge”).

 

25.
Waiver of Notice. To the extent permitted by law, the Company hereby irrevocably waives demand, notice, presentment, protest
and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of this Certificate
of Designations and the Securities Purchase Agreement.

 

26.
Governing Law. This Certificate of Designations shall be construed and enforced in accordance with, and all questions concerning
the construction, validity, interpretation and performance of this Certificate of Designations shall be governed by, the internal
laws of the State of Nevada, without giving effect to any choice of law or conflict of law provision or rule (whether of the State
of Nevada or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of
Nevada. Except as otherwise required by Section 23 above, the Company hereby irrevocably submits to the exclusive jurisdiction
of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and
agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any
such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or
proceeding is improper. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner
permitted by law. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted
by law. Nothing contained herein (i) shall be deemed or operate to preclude any Holder from bringing suit or taking other legal
action against the Company in any other jurisdiction to collect on the Company’s obligations to such Holder, to realize
on any collateral or any other security for such obligations, or to enforce a judgment or other court ruling in favor of such
Holder or (ii) shall limit, or shall be deemed or construed to limit, any provision of Section 23 above. THE COMPANY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION WITH OR ARISING OUT OF THIS CERTIFICATE OF DESIGNATIONS OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

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27.
Judgment Currency.

 

(a)
If for the purpose of obtaining or enforcing judgment against the Company in any court in any jurisdiction it becomes necessary
to convert into any other currency (such other currency being hereinafter in this Section 27 referred to as the “Judgment
Currency”) an amount due in U.S. dollars under this Certificate of Designations, the conversion shall be made at the
Exchange Rate prevailing on the Trading Day immediately preceding:

 

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

 

(ii)
the date on which the foreign court determines, in the case of any proceeding in the courts of any other jurisdiction (the date
as of which such conversion is made pursuant to this Section 27(a)(ii) being hereinafter referred to as the “Judgment
Conversion Date”).

 

(b)
If in the case of any proceeding in the court of any jurisdiction referred to in Section 27(a)(ii) above, there is a change in
the Exchange Rate prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable
party shall pay such adjusted amount as may be necessary to ensure that the amount paid in the Judgment Currency, when converted
at the Exchange Rate prevailing on the date of payment, will produce the amount of US dollars which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial order at the Exchange Rate prevailing on the Judgment
Conversion Date.

 

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

 

28.
Severability. If any provision of this Certificate of Designations is prohibited by law or otherwise determined to be invalid
or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable
shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability
of such provision shall not affect the validity of the remaining provisions of this Certificate of Designations so long as this
Certificate of Designations as so modified continues to express, without material change, the original intentions of the parties
as to the subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does
not substantially impair the respective expectations or reciprocal obligations of the parties or the practical realization of
the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace
the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible
to that of the prohibited, invalid or unenforceable provision(s).

 

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29.
Maximum Payments. Without limiting Section 9(d) of the Securities Purchase Agreement, nothing contained herein shall be
deemed to establish or require the payment of a rate of interest or other charges in excess of the maximum permitted by applicable
law. In the event that the rate of interest required to be paid or other charges hereunder exceed the maximum permitted by such
law, any payments in excess of such maximum shall be credited against amounts owed by the Company to the applicable Holder and
thus refunded to the Company.

 

30.
Stockholder Matters; Amendment.

 

(a)
Stockholder Matters. Any shareholder action, approval or consent required, desired or otherwise sought by the Company pursuant
to the NRS, the Articles of Incorporation, this Certificate of Designations or otherwise with respect to the issuance of Preferred
Shares may be effected by written consent of the Company’s shareholders or at a duly called meeting of the Company’s
shareholders, all in accordance with the applicable rules and regulations of the NRS. This provision is intended to comply with
the applicable sections of the NRS permitting shareholder action, approval and consent affected by written consent in lieu of
a meeting.

 

(b)
Amendment. Except for Section 4(d)(i), which may not be amended or waived hereunder, this Certificate of Designations or
any provision hereof may be amended by obtaining the affirmative vote at a meeting duly called for such purpose, or written consent
without a meeting in accordance with the NRS, of the Required Holders, voting separate as a single class, and with such other
shareholder approval, if any, as may then be required pursuant to the NRS and the Articles of Incorporation.

 

31.
Certain Defined Terms. For purposes of this Certificate of Designations, the following terms shall have the following meanings:

 

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

 

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

 

(c)
“Additional Amount” means, as of the applicable date of determination, with respect to each Preferred Share,
all declared and unpaid Dividends on such Preferred Share and any other unpaid amounts then due and payable hereunder with respect
to such Preferred Share.

 

(d)
“Adjustment Right” means any right granted with respect to any securities issued in connection with, or with
respect to, any issuance or sale (or deemed issuance or sale in accordance with Section 8(a)) of shares of Common Stock (other
than rights of the type described in Section 7(a) hereof) that could result in a decrease in the net consideration received by
the Company in connection with, or with respect to, such securities (including, without limitation, any cash settlement rights,
cash adjustment or other similar rights).

 

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

 

    	40

    	 

    

 

(f)
“Alternate Conversion Floor Amount” means an amount in cash, to be delivered by wire transfer of immediately
available funds pursuant to wire instructions delivered to the Company by the Holder in writing, equal to the product obtained
by multiplying (A) the higher of (I) the highest price that the Common Stock trades at on the Trading Day immediately preceding
the relevant Alternate Conversion Date and (II) the applicable Alternate Conversion Price and (B) the difference obtained by subtracting
(I) the number of shares of Common Stock delivered (or to be delivered) to the Holder on the applicable Share Delivery Deadline
with respect to such Alternate Conversion from (II) the quotient obtain by dividing (x) the applicable Conversion Amount that
the Holder has elected to be the subject of the applicable Alternate Conversion, by (y) the applicable Alternate Conversion Price
without giving effect to clause (x) of such definition.

 

(g)
“Alternate Conversion Price” with respect to any Alternate Conversion
that price which shall be the lower of (i) the applicable Conversion Price as in effect on the applicable Conversion Date of the
applicable Alternate Conversion and (ii) the greater of (x) the Floor Price and (y) 85% of the price computed as the quotient
of (I) the sum of the VWAP of the Common Stock for each Trading Day in five (5) consecutive Trading Day period ending and including
the Trading Day immediately preceding the delivery or deemed delivery of the applicable Conversion Notice, divided by (II) five
(5) (such period, the “Alternate Conversion Measuring Period”). All such determinations to be appropriately
adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction that proportionately
decreases or increases the Common Stock during such Alternate Conversion Measuring Period.

 

(h)
“Approved Stock Plan” means any employee benefit plan which has been approved by the Board prior to or subsequent
to the Subscription Date pursuant to which shares of Common Stock and options to purchase Common Stock may be issued to any employee,
officer, consultant or director for services provided to the Company in their capacity as such.

 

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

 

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

 

(k)
“Bloomberg” means Bloomberg, L.P.

 

(l)
“Book-Entry” means each entry on the Register evidencing one or more Preferred Shares held by a Holder in lieu
of a Preferred Share Certificate issuable hereunder.

 

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

 

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

 

(o)
“Change of Control Redemption Premium” means 125%.

 

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

 

(q)
“Closing Date” shall have the meaning set forth in the Securities Purchase Agreement, which date is the date
the Company initially issued the Preferred Shares, the Preferred Warrants and the Common Warrants pursuant to the terms of the
Securities Purchase Agreement.

 

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

 

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

 

(t)
“Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent or otherwise,
of that Person with respect to any Indebtedness, lease, dividend or other obligation of another Person if the primary purpose
or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such
liability that such liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that
the holders of such liability will be protected (in whole or in part) against loss with respect thereto.

 

(u)
“Conversion Floor Price Condition” means that the relevant Alternate Conversion Price or other conversion price
determined pursuant to Section 11(a) hereof, as applicable, is being determined based on clause (x) of such definition or section,
as applicable.

 

    	43

    	 

    

 

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

 

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

 

(x)
“Dividend Date” means, with respect to any given calendar month, the first Trading Day of such calendar month,
but with the first Dividend Date commencing on March 1, 2020.

 

(y)
“Dividend Rate” means nine percent (9%) per annum, as may be adjusted from time to time in accordance with
Section 3(b).

 

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

 

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

 

    	44

    	 

    

 

(bb)
“Excluded Securities” means (i) shares of Common Stock or options to purchase Common Stock issued to directors,
consultants, officers or employees of the Company for services rendered to the Company in their capacity as such pursuant to an
Approved Stock Plan (as defined above), provided that (A) all such issuances (taking into account the shares of Common Stock issuable
upon exercise of such options) after the Subscription Date pursuant to this clause (i) do not, in the aggregate, exceed more than
15% of the Common Stock issued and outstanding immediately prior to the Subscription Date, in the aggregate and (B) the exercise
price of any such options is not lowered, none of such options are amended to increase the number of shares issuable thereunder
and none of the terms or conditions of any such options are otherwise materially changed in any manner that adversely affects
any of the Holders; (ii) shares of Common Stock issued upon the conversion or exercise of Convertible Securities (other than options
to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) issued prior to the Subscription
Date, provided that the conversion price of any such Convertible Securities (other than options to purchase Common Stock issued
pursuant to an Approved Stock Plan that are covered by clause (i) above) is not lowered, none of such Convertible Securities (other
than options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are amended
to increase the number of shares issuable thereunder and none of the terms or conditions of any such Convertible Securities (other
than options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are otherwise
materially changed in any manner that adversely affects any of the Holders; (iii) the shares of Common Stock issuable upon conversion
of the Preferred Shares or otherwise pursuant to the terms of this Certificate of Designations; provided, that the terms of this
Certificate of Designations are not amended, modified or changed on or after the Subscription Date (other than antidilution adjustments
pursuant to the terms thereof in effect as of the Subscription Date), (iv) the Warrant Preferred Shares issuable upon exercise
of the Preferred Warrants; provided, that the terms of the Preferred Warrants are not amended, modified or changed on or after
the Subscription Date (other than antidilution adjustments pursuant to the terms thereof in effect as of the Subscription Date),
(vi) the shares of Common Stock issuable upon exercise of the Common Warrants; provided, that the terms of the Common Warrants
are not amended, modified or changed on or after the Subscription Date (other than antidilution adjustments pursuant to the terms
thereof in effect as of the Subscription Date) and (vii) shares of Common Stock and Common Stock issued upon the conversion or
exercise of Convertible Securities or Options (other than options to purchase Common Stock issued pursuant to an Approved Stock
Plan on or after the date of this Certificate of Designations that are covered by clause (i) above) issued or issuable pursuant
to strategic alliances, strategic mergers and acquisitions, strategic partnerships, strategic license agreements and other similar
transactions, provided that (I) the primary purpose of such issuance is not to raise capital, (II) the purchaser or acquirer of
such shares of Common Stock, Options and/or Convertible Securities in such issuance solely consists of the actual participants
in such strategic transaction or the stockholders, partners, members or Affiliates of the such participants, and (III) to the
extent there are multiple participants in such transaction, the number or amount (as the case may be) of such shares of Common
Stock, Options and/or Convertible Securities issued to such Person by the Company in such transaction shall not be disproportionate
to such Person’s actual participation in such strategic transaction.

 

(cc)
“Floor Price” means $0.18.

 

    	45

    	 

    

 

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

 

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

 

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

 

    	46

    	 

    

 

(gg)
“Holder Pro Rata Amount” means, with respect to any Holder, a fraction (i) the numerator of which is the number
of Preferred Shares issued to such Holder pursuant to the Securities Purchase Agreement on the Initial Issuance Date and (ii)
the denominator of which is the number of Preferred Shares issued to all Holders pursuant to the Securities Purchase Agreement
on the Initial Issuance Date.

 

(hh)
“Indebtedness” means of any Person means, without duplication (A) all indebtedness for borrowed money, (B)
all obligations issued, undertaken or assumed as the deferred purchase price of property or services, including, without limitation,
“capital leases” in accordance with United States generally accepted accounting principles consistently applied for
the periods covered thereby (other than trade payables entered into in the ordinary course of business consistent with past practice),
(C) all reimbursement or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (D)
all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses, (E) all indebtedness created or arising under any conditional sale or
other title retention agreement, or incurred as financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the event
of default are limited to repossession or sale of such property), (F) all monetary obligations under any leasing or similar arrangement
which, in connection with United States generally accepted accounting principles, consistently applied for the periods covered
thereby, is classified as a capital lease, (G) all indebtedness referred to in clauses (A) through (F) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, deed of
trust, lien, pledge, charge, security interest or other encumbrance of any nature whatsoever in or upon any property or assets
(including accounts and contract rights) with respect to any asset or property owned by any Person, even though the Person which
owns such assets or property has not assumed or become liable for the payment of such indebtedness, and (H) all Contingent Obligations
in respect of indebtedness or obligations of others of the kinds referred to in clauses (A) through (G) above.

 

(ii)
“Intellectual Property Rights” means, with respect to the Company and its Subsidiaries, all of their rights
or licenses to use all trademarks, trade names, service marks, service mark registrations, service names, original works of authorship,
patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and other intellectual
property rights and all applications and registrations therefor.

 

(jj)
“Liquidation Event” means, whether in a single transaction or series of transactions, the voluntary or involuntary
liquidation, dissolution or winding up of the Company or such Subsidiaries the assets of which constitute all or substantially
all of the assets of the business of the Company and its Subsidiaries, taken as a whole.

 

(kk)
“Make-Whole Amount” means as of any given date, the amount of any Dividend that, but for any conversion hereunder
on such given date, would have accrued with respect to the Conversion Amount being redeemed hereunder at the Dividend Rate then
in effect for the period from such given date through the third (3rd) anniversary of the Initial Issuance Date.

 

    	47

    	 

    

 

(ll)
“Material Adverse Effect” means any material adverse effect on the business, properties, assets, liabilities,
operations, results of operations, condition (financial or otherwise) or prospects of the Company and its Subsidiaries, if any,
individually or taken as a whole, or on the transactions contemplated hereby or on the other Transaction Documents (as defined
below), or by the agreements and instruments to be entered into in connection therewith or on the authority or ability of the
Company to perform its obligations under the Transaction Documents.

 

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

 

(nn)
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities.

 

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

 

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

 

(qq)
“Permitted Liens” means (i) any Lien for taxes not yet due or delinquent or being contested in good faith by
appropriate proceedings for which adequate reserves have been established in accordance with GAAP, (ii) any statutory Lien arising
in the ordinary course of business by operation of law with respect to a liability that is not yet due or delinquent, (iii) any
Lien created by operation of law, such as materialmen’s liens, mechanics’ liens and other similar liens, arising in
the ordinary course of business with respect to a liability that is not yet due or delinquent or that are being contested in good
faith by appropriate proceedings, (iv) Liens (A) upon or in any equipment acquired or held by the Company or any of its Subsidiaries
to secure the purchase price of such equipment or Indebtedness incurred solely for the purpose of financing the acquisition or
lease of such equipment, or (B) existing on such equipment at the time of its acquisition, provided that the Lien is confined
solely to the property so acquired and improvements thereon, and the proceeds of such equipment, in either case, with respect
to Indebtedness in an aggregate amount not to exceed $250,000, (v) Liens incurred in connection with the extension, renewal or
refinancing of the Indebtedness secured by Liens of the type described in clause (iv) above, provided that any extension, renewal
or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the Indebtedness
being extended, renewed or refinanced does not increase, (vi) Liens in favor of customs and revenue authorities arising as a matter
of law to secure payments of custom duties in connection with the importation of goods, (vii) Liens arising from judgments, decrees
or attachments in circumstances not constituting a Triggering Event under Section 5(a)(ix) and (viii) Liens with respect to Permitted
Senior Indebtedness.

 

    	48

    	 

    

 

(rr)
“Permitted Senior Indebtedness” means the principal of (and premium, if any), interest on, and all fees and
other amounts (including, without limitation, any reasonable out-of-pocket costs, enforcement expenses (including reasonable out-of-pocket
legal fees and disbursements), collateral protection expenses and other reimbursement or indemnity obligations relating thereto)
payable by Company and/or its Subsidiaries under or in connection with any credit facility to be entered into by the Company and/or
its Subsidiaries with one or more financial institutions (and on terms and conditions), in form and substance reasonably satisfactory
to the Required Holders; provided, however, that (i) no Permitted Senior Indebtedness is outstanding during the Restricted Period
(as defined in the Securities Purchase Agreement (or until such earlier time as approved by the Required Holders), (ii) the aggregate
outstanding amount of such Indebtedness permitted hereunder (taking into account the maximum amounts which may be advanced under
the loan documents evidencing such Permitted Senior Indebtedness) does not at any time exceed $2,000,000, (iii) such Permitted
Senior Indebtedness shall not be convertible or exchangeable, directly or indirectly, into Common Stock of the Company and (iv)
no Convertible Securities or Options shall be issued in connection with such Permitted Senior Indebtedness.

 

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

 

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

 

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

 

(vv)
“Redemption Conversion Floor Amount” means an amount in cash, to be delivered by wire transfer of immediately
available funds pursuant to wire instructions delivered to the Company by the Holder in writing, equal to the product obtained
by multiplying (A) the higher of (I) the highest price that the Common Stock trades at on the Trading Day immediately preceding
the relevant Conversion Date and (II) the applicable conversion price determined in accordance with Section 11(a) above and (B)
the difference obtained by subtracting (I) the number of shares of Common Stock delivered (or to be delivered) to the Holder on
the applicable Share Delivery Deadline with respect to such conversion from (II) the quotient obtain by dividing (x) the applicable
Conversion Amount that the Holder has elected to be the subject of the applicable conversion, by (y) the applicable conversion
price determined in accordance with Section 11(a) above without giving effect to clause (x) of such definition.

 

    	49

    	 

    

 

(ww)
“Redemption Notices” means, collectively, the Triggering Events Redemption Notices, and the Change of Control
Redemption Notices, and each of the foregoing, individually, a “Redemption Notice.”

 

(xx)
“Redemption Premium” means 125%.

 

(yy)
“Redemption Prices” means, collectively, any Triggering Event Redemption Price, Change of Control Redemption
Price, and each of the foregoing, individually, a “Redemption Price.”

 

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

 

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

 

(bbb)
“Securities Purchase Agreement” means that certain securities purchase agreement by and among the Company and
the initial holders of Preferred Shares, dated as of the Subscription Date, as may be amended from time in accordance with the
terms thereof.

 

(ccc)
“Series E Preferred Stock” shall mean the Series E Convertible Preferred Stock, par value $0.001, of the Company
as in effect as of the Initial Issuance Date.

 

(ddd)
“Stated Value” shall mean, with respect to any given Preferred Share, the sum of (x) $1,000 per Preferred Share,
and (y) the aggregate amount of any Capitalized Dividends per such Preferred Share, in each case, subject to adjustment for stock
splits, stock dividends, recapitalizations, reorganizations, reclassifications, combinations, subdivisions or other similar events
occurring after the Initial Issuance Date with respect to the Preferred Shares.

 

(eee)
“Subscription Date” means January 28, 2020.

 

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

 

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

 

    	50

    	 

    

 

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

 

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

 

(jjj)
“Transaction Documents” means the Securities Purchase Agreement, this Certificate of Designations, the Preferred
Warrants, the Common Warrants and each of the other agreements and instruments entered into or delivered by the Company or any
of the Holders in connection with the transactions contemplated by the Securities Purchase Agreement, all as may be amended from
time to time in accordance with the terms thereof.

 

(kkk)
“VWAP” means, for any security as of any date, the dollar volume-weighted average price for such security on
the Principal Market (or, if the Principal Market is not the principal trading market for such security, then on the principal
securities exchange or securities market on which such security is then traded), during the period beginning at 9:30 a.m., New
York time, and ending at 4:00 p.m., New York time, as reported by Bloomberg through its “VAP” function (set to 09:30
start time and 16:00 end time) or, if the foregoing does not apply, the dollar volume-weighted average price of such security
in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30 a.m., New
York time, and ending at 4:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is
reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask
price of any of the market makers for such security as reported in the “pink sheets” by OTC Markets Group Inc. (formerly
Pink Sheets LLC). If the VWAP cannot be calculated for such security on such date on any of the foregoing bases, the VWAP of such
security on such date shall be the fair market value as mutually determined by the Company and the Required Holders. If the Company
and the Required Holders are unable to agree upon the fair market value of such security, then such dispute shall be resolved
in accordance with the procedures in Section 23. All such determinations shall be appropriately adjusted for any stock dividend,
stock split, stock combination, recapitalization or other similar transaction during such period.

 

    	51

    	 

    

 

(lll)
“Warrant Common Shares” means, collectively, the shares of Common Stock issuable upon exercise of the Common
Warrants.

 

(mmm)
“Warrant Preferred Shares” means, collectively, the Preferred Shares issuable upon exercise of the Preferred
Warrants.

 

32.
Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Certificate of Designations,
unless the Company has in good faith determined that the matters relating to such notice do not constitute material, non-public
information relating to the Company or any of its Subsidiaries, the Company shall within one (1) Business Day of such receipt
or prior to (or simultaneous with) such delivery, as applicable, publicly disclose such material, non-public information on a
Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains material, non-public information
relating to the Company or any of its Subsidiaries, the Company so shall indicate to such Holder explicitly in writing in such
notice (or immediately upon receipt of notice from such Holder, as applicable), and in the absence of any such written indication
in such notice (or notification from the Company immediately upon receipt of notice from such Holder), such Holder shall be allowed
to presume that all matters relating to such notice do not constitute material, non-public information relating to the Company
or any of its Subsidiaries. If the Company or any of its Subsidiaries provides material non-public information to a Holder that
is not simultaneously filed in a Current Report on Form 8-K and such Holder has not agreed to receive such material non-public
information, the Company hereby covenants and agrees that such Holder shall not have any duty of confidentiality to the Company,
any of its Subsidiaries or any of their respective officers, directors, employees, affiliates or agents with respect to, or a
duty to any of the foregoing not to trade on the basis of, such material non-public information. Nothing contained in this Section
32 shall limit any obligations of the Company, or any rights of any Holder, under Section 4(i) of the Securities Purchase Agreement.

 

*
* * * *

 

    	52

    	 

    

 

IN
WITNESS WHEREOF, the Company has caused this Certificate of Designations of Series D Convertible Preferred Stock of Sigma Labs,
Inc to be signed by its Chief Executive Officer on this 27th day of January, 2020.

 

	 	SIGMA LABS, INC.
	 	 	 
	 	By:	/s/
    John Rice
	 	Name:	John
    Rice
	 	Title:	Chief
    Executive Officer

 

    	53

    	 

    

 

EXHIBIT
I

 

SIGMA
LABS, INC.

CONVERSION
NOTICE

 

Reference
is made to the Certificate of Designations, Preferences and Rights of the Series D Convertible Preferred Stock of Sigma Labs,
Inc (the “Certificate of Designations”). In accordance with and pursuant to the Certificate of Designations,
the undersigned hereby elects to convert the number of shares of Series D Convertible Preferred Stock, $[ ] par value per share
(the “Preferred Shares”), of Sigma Labs, Inc a Nevada corporation (the “Company”), indicated
below into shares of common stock, $0.001 value per share (the “Common Stock”), of the Company, as of the date
specified below.

 

	Date
    of Conversion:	 
	 	 
	Aggregate
    number of Preferred Shares to be converted	 
	 	 
	Aggregate
    Stated Value of such Preferred Shares to be converted:	 
	 	 
	Aggregate
    accrued and unpaid Dividends and accrued and unpaid Late Charges with respect to such Preferred Shares and such Aggregate
    Dividends to be converted:	 
	 	 
	AGGREGATE
    CONVERSION AMOUNT TO BE CONVERTED:	 
	 	 
	Please
    confirm the following information:
	 
	Conversion
    Price:	 
	 	 
	Number
    of shares of Common Stock to be issued:	 
	 	 
	[  ]
        If this Conversion Notice is being delivered with respect to an Alternate Conversion, check here if Holder is electing
        to use the following Alternate Conversion Price:____________

         

        Please
        issue the Common Stock into which the applicable Preferred Shares are being converted to Holder, or for its benefit, as
        follows:

         

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

	 
	Issue
    to:	 
	 	 
	 	 
	 	 
	[  ]
    Check here if requesting delivery by Deposit/Withdrawal at Custodian as follows: 
	 
	DTC
    Participant:	 
	 	 
	DTC
    Number:	 
	 	 
	Account
    Number:	 
	 	 	 	 	 	 

Date:
_____________ __,

 

__________________________

Name
of Registered Holder

 

	By:
    	 	 
	Name:
    	 	 
	Title:	 	 

 

Tax
ID:_____________________

 

Facsimile:___________________

 

E-mail
Address:

 

    	54

    	 

    

 

EXHIBIT
II

 

ACKNOWLEDGMENT

 

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

 

	 	SIGMA LABS, INC.
	 	 	 
	 	By:	       
	 	Name:	 
	 	Title:

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