Document:

Document

Exhibit 10.2
SECOND AMENDED AND RESTATED GUARANTY
THIS SECOND AMENDED AND RESTATED GUARANTY (“Guaranty”) is executed as of August 1, 2022, by KBSGI REIT PROPERTIES, LLC, a Delaware limited liability company (“Guarantor”), for the benefit of JPMORGAN CHASE BANK, N.A., in its capacity as administrative agent for the “Lenders” pursuant to the Loan Agreement described below (in such capacity, “Administrative Agent”) and in favor of each party that now or hereafter is bound under the Loan Agreement as a “Lender” (referred to herein individually as a “Lender” and collectively as the “Lenders”).
RECITALS
A.Pursuant to that certain Amended and Restated Term Loan and Security Agreement dated as of November 9, 2017, among KBSGI OFFICES AT GREENHOUSE, LLC, a Delaware limited liability company (“Greenhouse Borrower”) and KBSGI 213 WEST INSTITUTE PLACE, LLC, a Delaware limited liability company (“Institute Borrower,” and, together with Greenhouse Borrower, individually, collectively, jointly and severally, “Borrower”), KBSGI VON KARMAN TECH, LLC, a Delaware limited liability company (“Von Karman Borrower”), Lenders, and Administrative Agent, as amended by that certain Modification Agreement dated as of January 17, 2020 (the “Modification Agreement”), and that certain letter agreement dated as of October 18, 2021 (as amended, restated or otherwise modified from time to time, the “Loan Agreement”), Lenders agreed to make a loan to Borrower in the maximum principal amount of Seventy-Two Million Eight Hundred Thousand and No/100 Dollars ($72,800,000.00) (the “Loan”).  
B.The Loan is evidenced by that certain Amended and Restated Promissory Note dated November 9, 2017, made payable to JPMorgan Chase Bank, N.A., as sole Lender, in the stated principal amount of Seventy-Two Million Eight Hundred Thousand and No/100 Dollars ($72,800,000.00) (as amended, restated, renewed or otherwise modified from time to time, each, a “Note” and, collectively, the “Notes”).
C.Guarantor guaranteed Borrower’s obligations to Administrative Agent and Lenders in accordance with that certain Amended and Restated Guaranty dated November 9, 2017 (as amended, restated or otherwise modified, the “Original Guaranty”).
D.Pursuant to that certain Reciprocal Release Agreement dated as of January 17, 2020, by and among Greenhouse Borrower, Institute Borrower, Von Karman Borrower, Administrative Agent and Lenders, Von Karman Borrower was released from its obligations under the Notes and the Loan Agreement as more particularly provided therein.
E.Concurrently herewith, the Loan Agreement is being modified pursuant to that certain Second Modification dated as of even date herewith (the “Second Modification”) to extend the term of the Loan, change the benchmark interest rate applicable to the Loan and make certain other changes to the Loan on the terms and conditions set forth in the Second Modification.
F.As a condition to Administrative Agent’s and Lenders’ willingness to enter into the Second Modification, Administrative Agent and Lenders have required that Guarantor 

execute and deliver this Guaranty for the benefit of Administrative Agent and Lenders, which Guaranty amends and restates in its entirety the Original Guaranty. 
G.Guarantor is the owner of a direct or indirect interest in each Borrower, and Guarantor will directly benefit from Administrative Agent and Lenders modifying the Loan.
H.Any capitalized term used and not defined in this Guaranty shall have the meaning given to such term in the Loan Agreement.  This Guaranty is one of the Loan Documents described in the Loan Agreement.
AGREEMENT
NOW, THEREFORE, as an inducement to Administrative Agent and Lenders to modify the Loan to Borrowers and enter into the Loan Agreement, and for other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, Guarantor agrees with Administrative Agent and the Lenders, as follows: 
Section 1.  Guaranty of Obligations.
(a)Guarantor hereby absolutely, irrevocably and unconditionally guarantees to Administrative Agent and Lenders, the payment of the Obligations (but expressly excluding any amounts owing under the Environmental Indemnity Agreement, except as expressly provided in Sections 1(d)(A) and 1(d)(B) herein below), whether now or hereafter arising, as and when the same shall be due and payable, whether by lapse of time, by acceleration of maturity or otherwise.  This Guaranty is a guaranty of payment and not of collection only.  Administrative Agent and Lenders shall not be required to exhaust any right or remedy or take any action against Borrowers or any other person or entity or any collateral.  Guarantor agrees that, as between Guarantor and Administrative Agent and Lenders, the Obligations may be declared to be due and payable for the purposes of this Guaranty notwithstanding any stay, injunction or other prohibition which may prevent, delay or vitiate any declaration as regards Borrowers (or any of them) and that in the event of a declaration or attempted declaration, the Obligations shall immediately become due and payable by Guarantor (but expressly excluding any amounts owing under the Environmental Indemnity Agreement, except as expressly provided in Sections 1(d)(A) and 1(d)(B) herein below) for the purposes of this Guaranty.
(b)[Intentionally Omitted].  
(c)[Intentionally Omitted].  
(d)In addition, notwithstanding anything herein to the contrary, at all times until the Obligations have been paid in full and the Loan Documents and any applicable Swap Agreement are no longer in effect, Guarantor guarantees to Administrative Agent and the Lenders, the full and prompt payment of, and agrees to pay protect, guarantee, indemnify, defend and hold harmless Administrative Agent and Lenders from and against, any actual liability, loss, damage, costs and expenses (including legal fees) suffered by Administrative Agent or the Lenders, and caused by or related to or as a result of the following: 

									
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A.    all amounts owing under the Environmental Indemnity Agreement if, for any reason, (i) an environmental insurance policy which is the same in all material respects as the environmental insurance policy that was approved by Administrative Agent and delivered in connection with the closing of the Loan as required under Section 2.02(b)(xx) of the Loan Agreement (“Approved Environmental Insurance Policy”) is not maintained in full force and effect (including, without limitation, by reason of  Borrowers’ failure to pay the premiums with respect thereto), or (ii) Borrowers (x) fail, after written request by Administrative Agent, to direct payment of all amounts owing under such Approved Environmental Insurance Policy relating to the Mortgaged Properties to Administrative Agent or (y) disputes in writing the payment of such sums under the Approved Environmental Insurance Policy to Administrative Agent.  For avoidance of doubt, Guarantor shall have no liability under clause A(i) above so long as an environmental insurance policy, which is the same in all material respects as the Approved Environmental Insurance Policy, is in full force and effect providing effective coverage for claims relating to environmental matters that occurred prior to or during a Borrower’s period of ownership of a Mortgaged Property, to the same extent as under the Approved Environmental Insurance Policy, when and if demand is made by Administrative Agent under the Environmental Indemnity Agreement, whether or not the claim relating to any such environmental matter is a covered claim under such environmental insurance policy (unless such claim was a covered claim under the Approved Environmental Insurance Policy); and 
B.    all losses (which shall include, without limitation, attorneys’ fees and costs of defense) sustained or incurred by Administrative Agent and/or Lenders by reason of any failure to maintain in full force and effect (which Guarantor hereby covenants to so do) an environmental insurance policy which is the same in all material respects as the Approved Environmental Insurance Policy for a period of two years following the repayment of the Obligations in full.  As used in this subsection B, “full force and effect” shall include reference to an environmental insurance policy for events occurring prior to or during a Borrower’s period of ownership of a Mortgaged Property and that has coverage under an extended reporting period of no less than two (2) years following the repayment of the Obligations in full.  For avoidance of doubt, Guarantor shall have no liability under this subsection B so long as an environmental insurance policy, which is the same in all material respects as the Approved Environmental Insurance Policy, is in full force and effect providing coverage under an extended reporting period for claims relating to environmental matters that occurred prior to or during a Borrower’s period of ownership of the Mortgaged Property, to the same extent as under the Approved Environmental Insurance Policy, when and if demand is made by Administrative Agent under the Guaranty, whether or not the claim relating to any such environmental matter is a covered claim under such environmental insurance policy (unless such claim was a 
									
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covered claim under the Approved Environmental Insurance Policy).  For purposes of clarification (but subject to Section 27 below), Guarantor’s liability under this subsection B shall not be terminated or otherwise affected even if a Borrower’s obligations under the Environmental Indemnity Agreement are terminated in accordance with Section 10 of the Environmental Indemnity.
Section 2.  Guaranty Absolute.  Guarantor guarantees that the Obligations shall be paid strictly in accordance with the terms of the Loan Documents and any applicable Swap Agreement.  The liability of Guarantor under this Guaranty is absolute and unconditional irrespective of:  (a) any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to departure from any of the terms of any Loan Document or any applicable Swap Agreement, including any increase or decrease in the rate of interest thereon; (b) any release or amendment or waiver of, or consent to departure from, or failure to act by Administrative Agent or the Lenders with respect to, any other guaranty or support document, or any exchange, release or non-perfection of, or failure to act by Administrative Agent or the Lenders, with respect to, any collateral, for all or any of the Obligations; (c) any present or future law, regulation or order of any jurisdiction (whether of right or in fact) or of any agency thereof purporting to reduce, amend, restructure or otherwise affect any term of the Obligations or any Loan Document or any applicable Swap Agreement; (d) any change in the existence, structure, or ownership of any Borrower; (e) without being limited by the foregoing, any lack of validity or enforceability of any Loan Document or any applicable Swap Agreement; and (f) any other setoff, recoupment, defense or counterclaim whatsoever (in any case, whether based on contract, tort or any other theory) with respect to the Loan Documents and any applicable Swap Agreement or the transactions contemplated thereby which might constitute a legal or equitable defense available to, or discharge of, a Borrower or a guarantor.
Section 3.  Guaranty Irrevocable.  This Guaranty is a continuing guaranty of the payment of all Obligations now or hereafter existing and shall remain in full force and effect until payment in full of all Obligations and other amounts payable under this Guaranty and until the Loan Documents and any applicable Swap Agreement are no longer in effect.
Section 4.  Waiver of Certain Rights and Notices.  To the fullest extent not prohibited by applicable law, except as specifically provided herein, Guarantor hereby waives and agrees not to assert or take advantage of (a) any right to require Administrative Agent, for the benefit of the Lenders, to proceed against or exhaust its recourse against Borrowers, any other guarantor or endorser, or any security or collateral held by Administrative Agent or Lenders at any time or to pursue any other remedy in its power before proceeding against Guarantor hereunder; (b) the defense of the statute of limitations in any action hereunder; (c) any defense that may arise by reason of (i) the incapacity, lack of authority, death or disability of a Borrower, Guarantor or any other or others, (ii) the revocation or repudiation hereof by Guarantor or the revocation or repudiation of any of the Loan Documents by a Borrower or any other or others, (iii) the failure of Administrative Agent, on behalf of the Lenders, to file or enforce a claim against the estate (either in administration, bankruptcy or any other proceeding) of a Borrower or any other or others, (iv) the unenforceability in whole or in part of any Loan Document or any applicable Swap Agreement, (v) Administrative Agent’s or a Lender’s election in any proceeding instituted under the federal Bankruptcy Code, of the application of Section 1111(b)(2) of the federal Bankruptcy Code, or (vi) 
									
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any borrowing or grant of a security interest under Section 364 of the federal Bankruptcy Code; (d) presentment, demand for payment, protest, notice of discharge, notice of acceptance of this Guaranty, and indulgences and notices of any other kind whatsoever; (e) any defense based upon an election of remedies by Administrative Agent, on behalf of the Lenders, which destroys or otherwise impairs the subrogation rights of Guarantor or the right of Guarantor to proceed against Borrowers for reimbursement, or both; (f) any defense based upon any taking, modification or release of any collateral, or any failure to perfect any security interest in, or the taking of or failure to take any other action with respect to any collateral securing payment or performance of the Obligations; (g) any right to require marshaling of assets and liabilities, sale in inverse order of alienation, notice of acceptance of this Guaranty and of any obligations to which it applies or may apply; and (h) any rights or defenses based upon an offset by Guarantor against any obligation now or hereafter owed to Guarantor by Borrowers; it being the intention hereof that Guarantor shall remain liable hereunder to the extent set forth herein, notwithstanding any act, omission or thing which might otherwise operate as a legal or equitable discharge of Guarantor, until the termination of this Guaranty under Section 3.  Guarantor waives presentment, demand, notice of dishonor, protest, notice of acceptance of this Guaranty or incurrence of any of the Obligations and any other formality with respect to any of the Obligations or this Guaranty. 
Guarantor hereby waives:  (a) any defense based upon the application by Borrowers of any proceeds relating to the Loan Agreement for purposes other than the purposes represented by Borrowers to Administrative Agent and Lenders, or intended or understood by Administrative Agent and Lenders or Guarantor; (b) any defense based upon Administrative Agent’s or any Lender’s failure to disclose to Guarantor any information concerning a Borrower’s financial condition or any other circumstances bearing on a Borrower’s ability to pay all sums payable under the Loan Agreement; (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in any other respects more burdensome than that of a principal; (d) any rights of subrogation, reimbursement, indemnification and contribution, and any other rights and defenses that are or may become available to Guarantor by reason of Sections 2787 to 2855, inclusive, of the California Civil Code, any right to enforce any remedy which Administrative Agent and Lenders may have against a Borrower and any right to participate in, or benefit from, any security for the Loan Agreement now or hereafter held by Administrative Agent or Lenders; (e) presentment, demand, protest and notice of any kind (other than when expressly required under the Loan Documents); (f) the benefit of any statute of limitations affecting the liability of Guarantor hereunder or the enforcement hereof; (g) any right to require Administrative Agent, on behalf of the Lenders, to institute suit or exhaust remedies against a Borrower or others liable for any Obligations, to enforce Administrative Agent’s and Lenders’ rights against any collateral which shall have been given to secure the Obligations to enforce Administrative Agent’s and Lenders’ rights against any other guarantors of such indebtedness, to join Borrowers or any others liable on such Obligations in any action seeking to enforce this Guaranty, to resort to any other means of obtaining payment of such Obligations; (h) notices of disbursement of proceeds, acceptance hereof, proof of non-payment, default under any document, notices and demands of any kind; and (i) the invalidity illegality or unenforceability of all or any portion of the indebtedness guaranteed hereby or any of the Loan Documents for any reason whatsoever, including that interest on such indebtedness violates applicable usury laws, that the Borrowers or others liable for all or a portion thereof have valid defenses, claims or offsets to all or a portion of such indebtedness, or that the Loan Documents have been forged or otherwise are irregular or not genuine or authentic (it being agreed that Guarantor shall remain liable under 
									
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this Guaranty regardless of whether Borrowers or any other person shall be found not liable for repayment of all or a portion of such indebtedness).  Guarantor further waives any and all rights and defenses that Guarantor may have because Borrowers’ debt is secured by real property; this means, among other things, that (1) Administrative Agent and Lenders may collect or receive performance from Guarantor without first foreclosing on any real or personal property collateral pledged by any Borrower; (2) if Administrative Agent forecloses on any real property collateral pledged by a Borrower, then (A) the amount of the debt may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price, and (B) Administrative Agent and Lenders may collect or receive performance from Guarantor even if Administrative Agent, by foreclosing on the real property collateral, has destroyed any right Guarantor may have to collect from a Borrower.  The foregoing is an unconditional and irrevocable waiver of any rights and defenses Guarantor may have because Borrowers’ debt is secured by real property.  These rights and defenses include, but are not limited to, any rights or defenses based upon Sections 580a, 580b, 580d, or 726 of the California Code of Civil Procedure.  Without limiting the generality of the foregoing or any other provision hereof, Guarantor further expressly waives (i) all rights and defenses arising out of an election of remedies by the Administrative Agent or Lenders, even though that election of remedies, such as non-judicial foreclosure with respect to security for Borrowers’ obligations, has destroyed Guarantor’s rights of subrogation and reimbursement against the principal by the operation of Section 580(d) of the California Code of Civil Procedure or otherwise and (ii) any and all other rights and defenses to the extent permitted by law. Guarantor hereby waives any right it might otherwise have under Section 2822 of the California Civil Code or similar law or otherwise to have Borrowers designate the portion of any such obligation to be satisfied in the event that a Borrower provides partial satisfaction of such obligation.  Guarantor acknowledges and agrees that Borrowers may already have agreed with Administrative Agent and Lenders, or may hereafter agree, that in any such event the designation of the portion of the obligation to be satisfied shall, to the extent not expressly made by the terms of the Loan Documents, be made by Administrative Agent and Lenders rather than by Borrowers.  Finally, Guarantor agrees that the performance of any act or any payment which tolls any statute of limitations applicable to the Loan Documents shall similarly operate to toll the statute of limitations applicable to Guarantor’s liability hereunder.  
Section 5.  Reinstatement.  This Guaranty shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Obligations is rescinded or must otherwise be returned by Administrative Agent or Lenders on the insolvency, bankruptcy or reorganization of a Borrower or otherwise, all as though the payment had not been made, whether or not Administrative Agent is in possession of this Guaranty.
Section 6.  Subrogation.  Guarantor shall not exercise any rights which it may acquire by way of subrogation, reimbursement or contribution, as a result of any payment made under this Guaranty or otherwise, until all the Obligations have been paid in full and the Loan Documents and any Swap Agreement are no longer in effect.  If any amount is paid to Guarantor by a Borrower on account of such rights prior to such time, the amount shall be held in trust for the benefit of the Administrative Agent and Lenders and shall be promptly paid to Administrative Agent, for the benefit of the Lenders, to be credited and applied to the Obligations, whether matured or unmatured or absolute or contingent, in accordance with the terms of the Loan Documents and any applicable Swap Agreement.  If Guarantor makes payment to Administrative Agent, for the benefit of the Lenders, of all or any part of the Obligations and all the Obligations are paid in full and the Loan 
									
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Documents and any applicable Swap Agreement are no longer in effect, Administrative Agent shall, at Guarantor’s request, execute and deliver to Guarantor appropriate documents, without recourse and without representation or warranty, necessary to evidence the transfer by subrogation to Guarantor of the interest in the Obligations resulting from the payment.
Section 7.  Subordination.  Without limiting Administrative Agent’s or Lenders’ rights under any other agreement, any liabilities owed by Borrowers to Guarantor in connection with any extension of credit or financial accommodation by Guarantor to or for the account of a Borrower, including but not limited to interest accruing at the agreed contract rate after the commencement of a bankruptcy or similar proceeding, are hereby subordinated to the Obligations, and such liabilities of Borrowers to Guarantor, if Administrative Agent so requests, shall be collected, enforced and received by Guarantor as trustee for the Lenders and shall be paid over to Administrative Agent, for the benefit of the Lenders, on account of the Obligations but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty.
Section 8.  Certain Taxes.  Guarantor further agrees that all payments to be made hereunder shall be made without setoff or counterclaim and free and clear of, and without deduction for, any taxes, levies, imposts, duties, charges, fees, deductions, withholdings or restrictions or conditions of any nature whatsoever now or hereafter imposed, levied, collected, withheld or assessed by any country or by any political subdivision or taxing authority thereof or therein (“Taxes”).  If any Taxes are required to be withheld from any amounts payable to Administrative Agent on behalf of Lenders, hereunder, the amounts so payable to Administrative Agent on behalf of Lenders, shall be increased to the extent necessary to yield to Administrative Agent on behalf of Lenders, (after payment of all Taxes) the amounts payable hereunder in the full amounts so to be paid.  Whenever any Tax is paid by Guarantor, as promptly as possible thereafter, Guarantor shall send Administrative Agent an official receipt showing payment thereof, together with such additional documentary evidence as may be required from time to time by Administrative Agent.
Section 9.  Representations and Warranties.  Guarantor represents and warrants that: (a) this Guaranty (i) has been authorized by all necessary action; (ii) to Guarantor’s knowledge, does not violate any agreement, instrument, law, regulation or order applicable to Guarantor; (iii) to Guarantor’s knowledge, does not require the consent or approval of any person or entity, including but not limited to any governmental authority, or any filing or registration of any kind; and (iv) is the legal, valid and binding obligation of Guarantor enforceable against Guarantor in accordance with its terms, except to the extent that enforcement may be limited by applicable bankruptcy, insolvency and other similar laws affecting creditors’ rights generally; and (b) in executing and delivering this Guaranty, Guarantor has (i) without reliance on Administrative Agent or any Lender or any information received from Administrative Agent or any Lender and based upon such documents and information it deems appropriate, made an independent investigation of the transactions contemplated hereby and each Borrower, each Borrower’s business, assets, operations, prospects and condition, financial or otherwise, and any circumstances which may bear upon such transactions, Borrowers or the obligations and risks undertaken herein with respect to the Obligations; (ii) adequate means to obtain from Borrowers on a continuing basis information concerning Borrowers; (iii) full and complete access to the Loan Documents, any applicable Swap Agreement and any other documents executed in connection with the Loan Documents; and (iv) not relied and will not rely upon any representations or warranties of 
									
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Administrative Agent or any Lender not embodied herein or any acts heretofore or hereafter taken by Administrative Agent or any Lender (including but not limited to any review by Administrative Agent or any Lender of the affairs of Borrowers).
Section 10.  Financial Reports and Covenants.
(a)Guarantor shall keep adequate books and records of account in accordance with methods acceptable to Administrative Agent, consistently applied and shall furnish to Administrative Agent the financial statements, certificates and other information described in Section 4.09(b) of the Loan Agreement as and when required by said Section 4.09(b).
(b)Administrative Agent and its accountants shall have the right to examine, upon at least 24 hours’ prior written notice to Guarantor (provided no advance notice is required during the existence of a Default), the records, books, management and other papers of Guarantor which reflect upon its financial condition, at any Mortgaged Property or at any office regularly maintained by Guarantor where the books and records are located.  Such examination shall be at Administrative Agent’s and Lenders’ costs unless (i) a Default exists, (ii) Administrative Agent or any Lender has reason to believe any information provided to Administrative Agent or Lenders, by Guarantor may be incorrect or misleading in any material respect, or (iii) Administrative Agent, on behalf of the Lenders, is conducting such examination pursuant to its obligations under any applicable laws or regulations (provided, with respect to subsection (iii), in no event shall Guarantor be obligated to reimburse Administrative Agent or Lenders for such costs and expenses for more than one examination per year).  Administrative Agent and its accountants shall have the right to make copies and extracts from the foregoing records and other papers.  In addition, Administrative Agent and its accountants shall have the right to examine and audit the books and records of Guarantor pertaining to the income, expenses and operation of the Mortgaged Properties during reasonable business hours at any office of Guarantor where the books and records are located.
(c)Guarantor Prohibited Distributions.  Guarantor shall not make any distributions; provided, however, so long as no Default or Unmatured Default exists, Guarantor will be permitted to make distributions (i) to the extent necessary to maintain the REIT status of any of its direct or indirect owners that are REITs, and (ii) for Death and Disability Redemptions (as defined in the Second Modification); provided, however, amounts distributed for Death and Disability Redemptions shall not exceed $250,000, in the aggregate, for any calendar year.  
(d)Guarantor Covenant to Use Revenues.  All revenues received by Guarantor and/or cash currently held by Guarantor shall only be used for payment of Guarantor Operating Costs (as defined in the Second Modification).  
(e)Guarantor Permitted Indebtedness.  Guarantor not to incur any Indebtedness other than Guarantor Permitted Indebtedness (as defined in the Second Modification).
Section 11.  Guarantor Excess Cash Account.  
(a)If at any time Guarantor holds in excess of $7,000,000 in cash (the “Guarantor Excess Cash”), Guarantor shall either, at Guarantor’s discretion (i) pay to Administrative Agent all Guarantor Excess Cash and such amounts shall be deposited by Administrative Agent in an 
									
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account at, and controlled by, Administrative Agent established for the purpose of holding the Guarantor Excess Cash (the “Guarantor Excess Cash Account”) (and any interest that may accrue on the funds in such Guarantor Excess Cash Account shall accrue for the benefit of Guarantor so long as no Default exists) or (ii) pay to Administrative Agent all Guarantor Excess Cash to be applied in repayment of the Obligations (as defined in the Loan Agreement) in such order as Administrative Agent shall determine, or a combination of (i) and (ii) in Guarantor’s sole and absolute discretion.  
(b)Guarantor shall (i) complete and duly execute and deliver (as applicable) all documentation reasonably required by Administrative Agent to establish and pledge to Administrative Agent, for the benefit of the Lenders, the Guarantor Excess Cash Account (including Administrative Agent’s standard form of deposit account control agreement, blocked account agreement, or similar agreement, which shall be in all material respects consistent with the provisions of this Agreement and which shall be subject to any modification as may be agreed upon by Borrower and Administrative Agent), and (ii) otherwise reasonably cooperate with Administrative Agent in all reasonable respects to establish the Guarantor Excess Cash Account, pledge it to Administrative Agent, for the benefit of Lenders, and perfect such pledge, within ten (10) Business Days after Administrative Agent provides Guarantor with such documentation. Guarantor hereby grants to Administrative Agent a security interest in the Guarantor Excess Cash Account and all funds on deposit therein as additional security for the Obligations and agrees that it shall not, without obtaining the prior express written consent of Administrative Agent, further pledge, assign or grant any security interest in the Guarantor Excess Cash Account. Guarantor agrees to hold in trust for the benefit of Administrative Agent on behalf of the Lenders, all Guarantor Excess Cash in its possession prior to the deposit of such Guarantor Excess Cash into the Guarantor Excess Cash Account. This Agreement is, among other things, intended by the parties to be a security agreement for purposes of the UCC.
(c)During the existence of a Default, Administrative Agent shall have the right to apply all amounts in the Guarantor Excess Cash Account in repayment of the Obligations in such order as Administrative Agent shall determine.  Guarantor shall have no right to any funds in the Guarantor Excess Cash Account until payment of the Obligations in full.  
(d)Upon payment in full and satisfaction of all indebtedness under the Loan and obligations under the Loan Documents, any amounts remaining in the Guarantor Excess Cash Account shall be released to Guarantor.   
Section 12.  Remedies Generally.  The remedies provided in this Guaranty are cumulative and not exclusive of any remedies provided by law.
Section 13.  Setoff.  If a Default shall have occurred and be continuing, Administrative Agent and each Lender and each of their respective Affiliates are hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such party to or for the credit or the account of Guarantor against any of and all the obligations of Guarantor under this Guaranty, irrespective of whether or not Administrative Agent or such Lender shall have made any demand under this Guaranty and although such obligations may be unmatured.  The rights of Administrative Agent and each Lender 
									
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under this Section are in addition to other rights and remedies (including other rights of setoff) which such parties may have.
Section 14.  Formalities.  Guarantor waives presentment, demand, notice of dishonor, protest, notice of acceptance of this Guaranty or incurrence of any of the Obligations and any other formality with respect to any of the Obligations or this Guaranty.
Section 15.  Amendments and Waivers.  No amendment or waiver of any provision of this Guaranty, nor consent to any departure by Guarantor therefrom, shall be effective unless it is in writing and signed by Administrative Agent, and then the waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.  No failure on the part of Administrative Agent to exercise, and no delay in exercising, any right under this Guaranty shall operate as a waiver or preclude any other or further exercise thereof or the exercise of any other right.
Section 16.  Expenses.  Guarantor shall reimburse Administrative Agent and the Lenders on demand for all costs, expenses and charges (including without limitation reasonable fees and charges of external legal counsel for Administrative Agent and the Lenders) incurred by Administrative Agent and the Lenders in connection with the performance or enforcement of this Guaranty.  The obligations of Guarantor under this Section shall survive the termination of this Guaranty.
Section 17.  Assignment.  This Guaranty shall be binding on, and shall inure to the benefit of Guarantor, Administrative Agent, the Lenders and their respective successors, assigns, estates and personal representatives; provided that Guarantor may not assign or transfer its rights or obligations under this Guaranty.  Without limiting the generality of the foregoing:  (a) the obligations of Guarantor under this Guaranty shall continue in full force and effect and shall be binding on any successor partnership and on previous partners and their respective estates if Guarantor is a partnership, regardless of any change in the partnership as a result of death, retirement or otherwise; and (b) Administrative Agent and each Lender may assign, sell participations in or otherwise transfer their respective rights under the Loan Documents and any applicable Swap Agreement to any other person or entity in accordance with the terms of the Loan Agreement and any applicable Swap Agreement, and the other person or entity shall then become vested with all the rights granted to Administrative Agent or such Lender in this Guaranty or otherwise.
Section 18.  Captions.  The headings and captions in this Guaranty are for convenience only and shall not affect the interpretation or construction of this Guaranty.
Section 19.  Notices.  All notices or other written communications hereunder shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy or email, as follows:
(a)if to Guarantor, to it at c/o KBS Capital Advisors LLC, 800 Newport Center Drive, #700, Newport Beach, CA  92660, Attention of Bryce Lin, Director of Finance and Reporting (Phone No. (949) 97-0312 (Email Address: blin@kbsrealty.com);
									
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(b)With a copy to: Greenberg Traurig, LLP, 18565 Jamboree Road, Suite 500, Irvine, CA 92612, Attention of Bruce Fischer, Esq. (Phone No. (949) 732-6670 (Email Address fischerb@gtlaw.com); and 
(c)if to Administrative Agent, to it at JPMorgan Chase Bank, N.A., CCBSI – RE, 277 Park Avenue, 36th Floor, New York, NY 10017, Attention of Donald Wattson (Email Address:  donald.a.wattson@jpmorgan.com).
Guarantor and Administrative Agent may change their address or telecopy number or email address for notices and other communications hereunder by notice to the other party.  All notices and other communications given to Guarantor or Administrative Agent in accordance with the provisions of this Guaranty shall be deemed to have been given on the date of receipt, in the case of email notices, as evidenced by sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt function”).
Section 20.  Governing Law; Jurisdiction; Consent to Service of Process.
(a)This Guaranty shall be construed in accordance with and governed by the law of the State of California.
(b)Guarantor hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any United States Federal or State court sitting in Orange County, California, and any appellate court therein, in any action or proceeding arising out of or relating to this Guaranty, or for recognition or enforcement of any judgment, and Guarantor hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such State court(s) or, to the extent permitted by law, in such Federal court(s).  Guarantor hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Guaranty shall affect any right that Administrative Agent and Lenders may otherwise have to bring any action or proceeding relating to this Guaranty against Guarantor or its properties in the courts of any jurisdiction.
(c)Guarantor hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Guaranty in any court referred to in subsection (b) above.  Guarantor hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d)Guarantor irrevocably consents to service of process in the manner provided for notices herein.  Nothing in this Guaranty will affect the right of Administrative Agent and Lenders to serve process in any other manner permitted by law.
Section 21.  ECP RULES.  No Guarantor hereunder shall be deemed to be a guarantor of any Swap Obligations if such Guarantor is not an “Eligible Contract Participant” as defined in §1(a)(18) of the Commodity Exchange Act and the applicable rules issued by the Commodity Futures Trading Commission and/or the Securities and Exchange Commission (collectively, and as now or hereafter in effect, the “ECP Rules”) to the extent that the providing of such guaranty 
									
		-11-
	
			

by such Guarantor would violate the ECP Rules or any other applicable law or regulation.  This paragraph shall not affect any obligations of Guarantor other than Swap Obligations, nor shall it affect the obligations of any Guarantor who qualifies as an “Eligible Contract Participant”.
Section 22.  Invalid Provisions.  If any provision of this Guaranty is held to be illegal, invalid, or unenforceable under present or future laws effective during the term of this Guaranty, such provision shall be fully severable and this Guaranty shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Guaranty, and the remaining provisions of this Guaranty shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from this Guaranty, unless such continued effectiveness of this Guaranty, as modified, would be contrary to the basic understandings and intentions of the parties as expressed herein.
Section 23.  ENTIRETY.  THIS GUARANTY AND THE OTHER LOAN DOCUMENTS EXECUTED BY GUARANTOR EMBODY THE FINAL, ENTIRE AGREEMENT OF GUARANTOR, ADMINISTRATIVE AGENT AND THE LENDERS WITH RESPECT TO THE SUBJECT MATTER HEREOF AND THEREOF AND SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF.  THIS GUARANTY AND THE OTHER LOAN DOCUMENTS EXECUTED BY GUARANTOR ARE INTENDED BY GUARANTOR, ADMINISTRATIVE AGENT AND THE LENDERS AS A FINAL AND COMPLETE EXPRESSION OF THE TERMS HEREOF AND THEREOF, AND NO COURSE OF DEALING AMONG GUARANTOR, ADMINISTRATIVE AGENT AND THE LENDERS, NO COURSE OF PERFORMANCE, NO TRADE PRACTICES, AND NO EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OR OTHER EXTRINSIC EVIDENCE OF ANY NATURE SHALL BE USED TO CONTRADICT, VARY, SUPPLEMENT OR MODIFY ANY TERM OF THIS GUARANTY OR ANY OTHER LOAN DOCUMENT EXECUTED BY GUARANTOR.  THERE ARE NO ORAL AGREEMENTS BETWEEN GUARANTOR, ADMINISTRATIVE AGENT AND THE LENDERS.
Section 24.  WAIVER OF JURY TRIAL AND JUDICIAL REFERENCE PROVISION.  
EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS GUARANTY AND REFERENCE AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

									
		-12-
	
			

IN THE EVENT ANY LEGAL PROCEEDING IS FILED IN A COURT OF THE STATE OF CALIFORNIA (THE “COURT”) BY OR AGAINST ANY PARTY HERETO IN CONNECTION WITH ANY CONTROVERSY, DISPUTE OR CLAIM DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) (EACH, A “CLAIM”) AND THE WAIVER SET FORTH IN THE PRECEDING PARAGRAPH IS NOT ENFORCEABLE IN SUCH ACTION OR PROCEEDING, THE PARTIES HERETO AGREE AS FOLLOWS:
1. WITH THE EXCEPTION OF THE MATTERS SPECIFIED IN PARAGRAPH 2 BELOW, ANY CLAIM WILL BE DETERMINED BY A GENERAL REFERENCE PROCEEDING IN ACCORDANCE WITH THE PROVISIONS OF CALIFORNIA CODE OF CIVIL PROCEDURE SECTIONS 638 THROUGH 645.1. THE PARTIES INTEND THIS GENERAL REFERENCE AGREEMENT TO BE SPECIFICALLY ENFORCEABLE IN ACCORDANCE WITH CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 638. EXCEPT AS OTHERWISE PROVIDED IN THE LOAN DOCUMENTS, VENUE FOR THE REFERENCE PROCEEDING WILL BE IN THE STATE OR FEDERAL COURT IN THE COUNTY OR DISTRICT WHERE VENUE IS OTHERWISE APPROPRIATE UNDER APPLICABLE LAW.
2. THE FOLLOWING MATTERS SHALL NOT BE SUBJECT TO A GENERAL REFERENCE PROCEEDING: (A) NON-JUDICIAL FORECLOSURE OF ANY SECURITY INTERESTS IN REAL OR PERSONAL PROPERTY, (B) EXERCISE OF SELF-HELP REMEDIES (INCLUDING, WITHOUT LIMITATION, SET-OFF), (C) APPOINTMENT OF A RECEIVER AND (D) TEMPORARY, PROVISIONAL OR ANCILLARY REMEDIES (INCLUDING, WITHOUT LIMITATION, WRITS OF ATTACHMENT, WRITS OF POSSESSION, TEMPORARY RESTRAINING ORDERS OR PRELIMINARY INJUNCTIONS).  THIS AGREEMENT DOES NOT LIMIT THE RIGHT OF ANY PARTY TO EXERCISE OR OPPOSE ANY OF THE RIGHTS AND REMEDIES DESCRIBED IN CLAUSES (A) - (D) AND ANY SUCH EXERCISE OR OPPOSITION DOES NOT WAIVE THE RIGHT OF ANY PARTY TO A REFERENCE PROCEEDING PURSUANT TO THIS AGREEMENT.
3. UPON THE WRITTEN REQUEST OF ANY PARTY, THE PARTIES SHALL SELECT A SINGLE REFEREE, WHO SHALL BE A RETIRED JUDGE OR JUSTICE.  IF THE PARTIES DO NOT AGREE UPON A REFEREE WITHIN TEN (10) DAYS OF SUCH WRITTEN REQUEST, THEN, ANY PARTY MAY REQUEST THE COURT TO APPOINT A REFEREE PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 640(B). 
4. ALL PROCEEDINGS AND HEARINGS CONDUCTED BEFORE THE REFEREE, EXCEPT FOR TRIAL, SHALL BE CONDUCTED WITHOUT A COURT REPORTER, EXCEPT WHEN ANY PARTY SO REQUESTS, A COURT REPORTER WILL BE USED AND THE REFEREE WILL BE PROVIDED A COURTESY COPY OF THE TRANSCRIPT. THE PARTY MAKING SUCH REQUEST SHALL HAVE THE OBLIGATION TO ARRANGE FOR AND PAY COSTS OF THE 
									
		-13-
	
			

COURT REPORTER, PROVIDED THAT SUCH COSTS, ALONG WITH THE REFEREE’S FEES, SHALL ULTIMATELY BE BORNE BY THE PARTY WHO DOES NOT PREVAIL, AS DETERMINED BY THE REFEREE.
5. THE REFEREE MAY REQUIRE ONE OR MORE PREHEARING CONFERENCES. THE PARTIES HERETO SHALL BE ENTITLED TO DISCOVERY, AND THE REFEREE SHALL OVERSEE DISCOVERY IN ACCORDANCE WITH THE RULES OF DISCOVERY, AND MAY ENFORCE ALL DISCOVERY ORDERS IN THE SAME MANNER AS ANY TRIAL COURT JUDGE IN PROCEEDINGS AT LAW IN THE STATE OF CALIFORNIA. THE REFEREE SHALL APPLY THE RULES OF EVIDENCE APPLICABLE TO PROCEEDINGS AT LAW IN THE STATE OF CALIFORNIA AND SHALL DETERMINE ALL ISSUES IN ACCORDANCE WITH APPLICABLE STATE AND FEDERAL LAW. THE REFEREE SHALL BE EMPOWERED TO ENTER EQUITABLE AS WELL AS LEGAL RELIEF AND RULE ON ANY MOTION WHICH WOULD BE AUTHORIZED IN A TRIAL, INCLUDING, WITHOUT LIMITATION, MOTIONS FOR DEFAULT JUDGMENT OR SUMMARY JUDGMENT. THE REFEREE SHALL REPORT HIS DECISION, WHICH REPORT SHALL ALSO INCLUDE FINDINGS OF FACT AND CONCLUSIONS OF LAW.
6. THE PARTIES RECOGNIZE AND AGREE THAT ALL CLAIMS RESOLVED IN A GENERAL REFERENCE PROCEEDING PURSUANT HERETO WILL BE DECIDED BY A REFEREE AND NOT BY A JURY.
ADMINISTRATIVE AGENT AND LENDERS WILL BE DEEMED TO HAVE AGREED TO THE PROVISIONS OF THIS SECTION BY ACCEPTING THIS GUARANTY.
Section 25.  WAIVER OF SPECIAL DAMAGES.  Guarantor agrees that neither Administrative Agent nor any Lender shall have any liability to Guarantor (whether sounding in tort, contract or otherwise) for losses suffered by Guarantor in connection with, arising out of, or in any way related to, the transactions contemplated and the relationship established by the Loan Documents and any applicable Swap Agreement, or any act, omission or event occurring in connection therewith, unless such losses result from the gross negligence or willful misconduct of the party from which recovery is sought or from a breach of any Loan Document or any applicable Swap Agreement by such party.  TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW, GUARANTOR SHALL NOT ASSERT, AND HEREBY WAIVES, ANY CLAIM AGAINST ADMINISTRATIVE AGENT AND EACH OF THE LENDERS ON ANY THEORY OF LIABILITY, FOR SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL DAMAGES) ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF, THIS GUARANTY, ANY OTHER LOAN DOCUMENT OR ANY SWAP AGREEMENT, THE OBLIGATIONS OR THE USE OF THE PROCEEDS THEREOF.
Section 26.  Limitation on Liability.  Notwithstanding the foregoing or anything to the contrary in this Guaranty, under no circumstances shall Administrative Agent or the Lenders have any recourse against, nor shall there be any personal liability to, the members of Guarantor, or to any shareholders, members or partners (direct or indirect) for any obligations of Guarantor 
									
		-14-
	
			

hereunder.  For purposes of clarification, in no event shall the above language limit, reduce or otherwise affect any Guarantor’s liability or obligations under the Guaranty or Administrative Agent’s and Lenders’ right to exercise any rights or remedies against any collateral securing the Loan.  
Section 27.  Termination of Environmental Liability.  Notwithstanding anything to the contrary stated in this Guaranty, if the conditions set forth in Sections 10.1 through 10.5 of the Environmental Indemnity Agreement are satisfied (i.e., all conditions for Borrowers’ release of their liability under the Environmental Indemnity Agreement other than the expiration of the two year period have been satisfied), Guarantor’s liability under Sections 1(d)A and 1(d)B of this Guaranty with respect to environmental liability shall automatically terminate.  
[SIGNATURE PAGE FOLLOWS]
									
		-15-
	
			

IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be duly executed and delivered by its duly authorized officer as of the date first above written.
KBSGI REIT PROPERTIES, LLC,
a Delaware limited liability company
By:    KBS GROWTH & INCOME LIMITED PARTNERSHIP,
a Delaware limited partnership,
its sole member
By:    KBS GROWTH & INCOME REIT, INC.,
a Maryland corporation,
its general partner
By:    /s/ Charles J. Schreiber, Jr.
Charles J. Schreiber, Jr.,
Chief Executive Officer
									
		S-1Exhibit
4.3

 

THIS
NOTE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT
BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY. THIS NOTE AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS NOTE MAY BE PLEDGED IN CONNECTION WITH A BONA
FIDE MARGIN ACCOUNT SECURED BY SUCH SECURITIES.

 

MARIZYME,
INC.

 

Form
of 10% Secured Convertible Promissory Note

 

Note
due June 17, 2024

 

	Note
    No. 36	 	$500,000
	Dated:
    June 17, 2022 (the “Issuance Date”)	 	 

 

For
value received, MARIZYME, INC., a Nevada corporation (the “Maker” or the “Company”), hereby promises
to pay to the order of Waichun Logistics Technology Limited, an entity (together with its successors and representatives, the “Holder”),
in accordance with the terms hereinafter provided, the principal amount of Five Hundred Thousand Dollars ($500,000) (the “Principal
Amount”).

 

All
payments under or pursuant to this 10% Secured Convertible Promissory Note (this “Note”)
shall be made in United States Dollars in immediately available funds to the Holder at the address of the Holder set forth in
the Purchase Agreement (as hereinafter defined) or at such other place as the Holder may designate from time to time in writing to the
Maker or by wire transfer of funds to the Holder’s account, instructions for which are attached hereto as Exhibit
A. The outstanding principal balance of this Note and any interest on the aggregate unconverted and then outstanding
principal amount hereof shall be due and payable on the date that is the 24-month anniversary of the Issuance Date, or June 17, 2024
(the “Maturity Date”) or at such earlier time as provided herein. In the event that the Maturity Date shall fall on
Saturday or Sunday, such Maturity Date shall be the next succeeding Business Day. All calculations made pursuant to this Note shall be
rounded down to three decimal places.

 

This
Note is one of a series of Notes of the Company in the aggregate principal amount of up to a maximum of Seventeen Million Dollars ($17,000,000)
(collectively, the “Notes”).

 

    	 

     

    

 

ARTICLE
1

 

1.1
Purchase Agreement. This Note has
been executed and delivered pursuant to
the Unit Purchase Agreement, dated as
of June 17, 2022 (as the same may be amended
from time to time, the “Purchase Agreement”), by and between the
Maker and the Holder. Capitalized terms used and not otherwise
defined herein shall have the meanings set forth
for such terms in the Purchase Agreement.

 

1.2
Interest.

 

(a)
Payment of Interest and Calculations. Interest shall accrue to the Holder on the aggregate unconverted and then outstanding principal
amount of this Note at the rate of ten percent (10%) per annum, calculated on the basis of a 360-day year and shall accrue daily commencing
on the Issuance Date until payment in full of the Outstanding Principal Amount (or conversion to the extent applicable), together with
all accrued and unpaid interest, liquidated damages, Late Fees and other amounts which may become due hereunder, has been made.

 

(b)
Late Fees. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate equal to the
lesser of 10% per annum or the maximum rate permitted by applicable law (the “Late Fees”) that shall accrue daily from the
date such interest is due hereunder through and including the date of actual payment in full.

 

1.3
Prepayment. The Company may not prepay all or any part of the Outstanding Principal Balance.

 

1.4
Delisting from a Trading Market. If at any time the Common Stock ceases, as applicable, to be eligible
for quotation or listed on a Trading Market, (i) the Holder may deliver a demand for payment to the Company and, if such a demand
is delivered, the Company shall, within ten (10) Business Days following receipt of the demand for payment from the Holder, pay all of
the Outstanding Principal Amount or (ii) the Holder may, at its election, after the six-month anniversary of the Issuance Date or earlier
if a Registration Statement covering the Conversion Shares has been declared effective, upon notice to the Company in accordance with
Section 5.1, convert all or a portion of the Outstanding Principal Amount and the Conversion Price shall be adjusted to the then-current
Conversion Price.

 

1.5
Payment on Non-Business Days. Whenever any payment to be made shall be due on a day which is not a Business Day, such payment
may be due on the next succeeding Business Day.

 

1.6
Replacement. Upon receipt of a duly executed and
notarized written statement from the Holder with respect to the loss,
theft or destruction of this Note (or any replacement hereof), or, in the case of a mutilation of this Note, upon surrender and
cancellation of such Note, the Maker shall issue a new Note, of like tenor and amount, in lieu of such lost, stolen, destroyed or mutilated
Note.

 

    	2

     

    

 

1.7
Use of Proceeds. The Maker shall use the proceeds of this Note as set forth in the Purchase Agreement.

 

1.8
Status of Note and Security Interest.
The obligations of the Maker under this Note shall be senior to all other existing Indebtedness
and equity of the Company. Upon any Liquidation Event (as hereinafter defined), the Holder will be entitled to receive, before any distribution
or payment is made upon, or set apart with respect to, any Indebtedness of the Maker or any class of capital stock of the Maker, an amount
equal to the Outstanding Principal Amount. For purposes of this Note, “Liquidation Event” means a liquidation pursuant
to a filing of a petition for bankruptcy under applicable law or any other insolvency or debtor’s relief, an assignment for the
benefit of creditors, or a voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Maker.

 

1.9
Secured Note. The full amount of this Note plus any other fees and expenses due hereunder or under any other Transaction Document
is secured by the Collateral (as defined in the Security Agreement) identified and described as security therefor in the Security
Agreement, the Pledge Agreement, the Company Patent Security Agreement and the Company
Trademark Security Agreement. In addition, the obligations are also guaranteed by the Company’s Subsidiaries, pursuant to the Subsidiary
Guaranty, and all of Subsidiaries’ obligations under the Subsidiary Guaranty are secured by the “Collateral” (as defined
in the Subsidiary Security Agreement) identified and described as security therefor in the Subsidiary Security Agreement.

 

1.10
Tax Treatment. [Reserved].

 

ARTICLE
2

 

2.1
Events of Default. An “Event of Default” under this Note shall mean the occurrence of any of the events defined
in the Purchase Agreement, and any of the additional events described below:

 

(a)
any default in the payment of (i) the Principal
Amount hereunder when due; or (ii) liquidated damages in respect of this Note as and when
the same shall become due and payable (whether on the Maturity Date or by acceleration or otherwise);

 

(b)
the Maker shall fail to observe or perform any other covenant, condition or agreement contained in this Note or the Maker or any Subsidiary,
as applicable, shall fail to observe or perform any other covenant, condition or agreement contained in any Transaction Document;

 

(c)
the Maker’s notice to the Holder, including by way of public announcement, at any time, of its inability to comply (including for
any of the reasons described in Section
3.6(a) hereof) or its intention not
to comply with proper requests for conversion
of this Note into shares of Common Stock;

 

(d)
the Maker shall fail to (i) timely deliver the shares of Common Stock as and when required in Section 3.2; or (ii) make the payment
of any fees and/or liquidated damages under this Note, the Purchase Agreement or the other Transaction Documents;

 

    	3

     

    

 

(e)
default shall be made in the performance or observance of any material covenant, condition or agreement contained in the
Purchase Agreement or any other Transaction Document that is not covered by any other provisions of this Section 2.1;

 

(f)
at any time the
Maker shall fail to have
a sufficient number of shares
of Common Stock authorized, reserved and available for issuance to satisfy the potential
conversion in full (disregarding for this purpose any and all limitations of
any kind on such
conversion) of this
Note or upon exercise of the Warrant;

 

(g)
any representation or warranty made by the Maker or any of its Subsidiaries herein or in the Purchase Agreement, this Note, the Warrant
or any other Transaction Document shall prove to have been false or incorrect or breached in a material respect on the date as of which
made;

 

(h)
unless otherwise approved in writing in advance by the Holder, the Maker shall, or shall announce an intention to pursue or consummate
a Change of Control, or a Change of Control shall be consummated,
or the Maker shall negotiate, propose or enter
into any agreement, understanding or arrangement
with respect to any Change of Control;

 

(i)
the Maker or any of its Subsidiaries shall (A) default in any payment of any amount or amounts of principal of or interest (if any) on
any Indebtedness (other than the
Indebtedness hereunder), the aggregate
principal amount of which
Indebtedness is in excess of $100,000 or (B)
default in the observance
or performance of any other
agreement or condition relating to any such
Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or
any other event shall occur
or condition exist, the effect of which
default or other event or condition is to
cause, or to permit the holder
or holders or beneficiary or
beneficiaries of such Indebtedness to cause with the giving of notice if required, such Indebtedness to become due prior to its
stated maturity;

 

(j)
the Maker or any of its Subsidiaries shall: (i) apply
for or consent to the appointment of, or
the taking of possession by, a receiver, custodian,
trustee or liquidator of itself or of all or a substantial part of its
property or assets; (ii) make a general assignment for the
benefit of its creditors; (iii) commence a voluntary case under the
United States Bankruptcy Code (as now or hereafter in effect) or under the
comparable laws of any jurisdiction (foreign or domestic); (iv) file a petition seeking to take advantage of any bankruptcy, insolvency,
moratorium, reorganization or other similar law affecting the enforcement of creditors’ rights generally; (v) acquiesce in writing
to any petition filed against it in an involuntary case under United States Bankruptcy Code (as now or hereafter in effect) or under
the comparable laws of any jurisdiction (foreign or domestic); (vi) issue a notice of bankruptcy or winding down of its operations or
issue a press release regarding same; or (vii) take any action under the laws of any jurisdiction
(foreign or domestic) analogous to any of the foregoing;

 

    	4

     

    

 

(k)
a proceeding or case shall be commenced in respect of the Maker, or any of its Subsidiaries, without
its application or consent, in any court
of competent jurisdiction, seeking: (i)
the liquidation, reorganization, moratorium, dissolution, winding up,
or composition or
readjustment of its debts; (ii) the appointment
of a trustee, receiver, custodian, liquidator or the like
of it or of all or any substantial part of its
assets in connection with the liquidation or dissolution of the Maker or any of its Subsidiaries; or (iii) similar relief in respect
of it under any law providing for the relief of debtors, and such proceeding or case described
in clause (i), (ii) or (iii) shall continue undismissed, or unstayed and in effect, for a period of forty-five (45) days or any order
for relief shall be entered in an involuntary case under United States Bankruptcy Code (as now or hereafter in effect) or under the comparable
laws of any jurisdiction (foreign or domestic) against the Maker or any of its Subsidiaries or action under
the laws of any jurisdiction (foreign or
domestic) analogous to any of the foregoing shall be
taken with respect to the Maker or any of its
Subsidiaries and shall continue undismissed, or unstayed and in effect for a period of forty-five (45) days;

 

(l)
one or more final judgments or orders for the payment of money aggregating in excess of $100,000 (or its equivalent in the relevant currency
of payment) are rendered against one or more of the Company and its Subsidiaries;

 

(m)
the failure of the Maker to instruct its transfer agent to remove any legends from shares of Common Stock and issue such
unlegended certificates to the Holder
within three (3) Trading Days
of the Holder’s request so
long as the
Holder has provided
reasonable assurances to the Maker that such shares of Common Stock can be sold pursuant
to Rule 144 or any other applicable exemption;

 

(n)
the Maker’s shares of Common Stock are no longer publicly traded or cease to be listed on
the Trading Market, or after the six-month anniversary of the Issuance Date, any Investor Shares may not be immediately resold
under Rule 144 without restriction on the number of shares to be sold or manner of sale, unless such Investor Shares have been registered
for resale under the Securities Act and may be sold without restriction;

 

(o)
the Maker consummates a “going private” transaction
and as a result the
Common Stock is no longer registered under
Sections 12(b) or 12(g) of the 1934 Act;

 

(p)
there shall be any
SEC or judicial stop
trade order or trading suspension stop-order
or any restriction
in place with
the transfer agent for the Common Stock restricting the trading of such Common Stock;

 

(q)
the Depository Trust Company places any restrictions on transactions in the Common Stock or the Common Stock is no longer tradeable through
the Depository Trust Company Fast Automated Securities Transfer program; or

 

(r)
the occurrence of a Material Adverse Effect in respect of the Maker, or the Maker and its Subsidiaries taken as a whole.

 

For
the avoidance of doubt, any default pursuant to clause (i) above shall not be subject to any cure periods pursuant to the instrument
governing such Indebtedness or this Note.

 

    	5

     

    

 

2.2
Remedies Upon an Event of Default.

 

(a)
Upon the occurrence of any Event of Default that has not been remedied within (i) two (2) Business Days for an Event of Default occurring
by the Company’s failure to comply with Section 7.1(c) of the Purchase Agreement or Section 4.2 of this Note, or
(ii) ten (10) Business Days for all other Events of Default, provided, however, that there shall be no cure period for
an Event of Default described in Section 2.1(i), 2.1(j) or 2.1(k), the Maker shall be obligated to pay to the Holder
the Mandatory Default Amount, which Mandatory Default Amount shall be earned by the Holder on the date the Event of Default giving rise
thereto occurs and shall be due and payable on the earlier to occur of the Maturity Date, upon conversion, redemption or prepayment of
this Note or the date on which all amounts owing hereunder have been accelerated in accordance with the terms hereof.

 

(b)
Upon the occurrence of any Event of Default, if any Investor alleges in writing a claim of breach, the Maker shall, as promptly as possible
but in any event within one (1) Business Day of receipt of such claim, furnish a copy of
such claim to the Holder and notify the Holder the Maker’s response thereto. Thereafter, if the Requisite Holders join with the
initiating noteholder, then the Requisite Holders shall select a noteholder representative (the “Representative”)
to represent their interests hereunder and under the other Transaction Documents. The Representative shall thereafter be able to act
on behalf of the holders of the Notes and pursue remedies under the Notes and the other Transaction Documents, amend or waive the Notes
and the other Transaction Documents or otherwise act on behalf of the holders of the Notes hereunder and thereunder.

 

(c)
If an Event of Default shall have occurred and shall not have been remedied within (i) two (2) Business Days for an Event of Default
occurring by the Company’s failure to comply with Section 7.1(c) of the Purchase Agreement or Section 4.2 of this
Note, or (ii) ten (10) Business Days for all other Events of Default, provided, however, that there shall be no cure period
for an Event of Default described in Section 2.1(i), 2.1(j) or 2.1(k), the Holder may at any time at its option
declare the Mandatory Default Amount due
and payable, and thereupon,
the same shall be accelerated
and so due and payable,
without presentment, demand, protest, or notice, all
of which are hereby
expressly unconditionally and irrevocably waived by the Maker; provided,
further, however, that (x) upon the occurrence of an Event of Default described above, the Holder, in its sole and absolute
discretion, may: (a) from time-to-time demand that all or a portion of the Outstanding Principal Amount be converted
into shares of Common
Stock at the then-current Conversion Price; or (b) exercise or otherwise enforce any one or more of the Holder’s rights,
powers, privileges, remedies and interests under
this Note, the Purchase Agreement, the other Transaction
Documents or applicable law and (y) upon the occurrence of an Event of Default described
in clauses (k) or (l) above, the Mandatory Default Amount shall become immediately due and payable without presentment, demand, protest
or other notice of any kind, all of which are hereby waived by the Maker. No course of delay
on the part of the Holder shall operate as
a waiver thereof or otherwise prejudice the rights
of the Holder. No remedy conferred hereby shall be exclusive of any other remedy referred
to herein or now or hereafter available at law, in equity, by statute or otherwise.

 

    	6

     

    

 

ARTICLE
3

 

3.1
Registration under Registration Statement. The Holder’s registration rights are set forth in the Registration Rights Agreement.

 

3.2
Different Denominations. This Note is exchangeable for an equal aggregate principal amount of Note of different authorized denominations,
as requested by the Holder surrendering the same. No service charge will be payable for such registration of transfer or exchange.

 

3.3
Investment Representations. This Note has been issued subject to certain investment representations of the Holder and may be transferred
or exchanged, subject to the provisions of Section 6.8 of this Note, only in compliance
with the Purchase Agreement and applicable federal and state securities laws and regulations.

 

3.4
Reliance on Note Register. Prior to due presentment for transfer to the Company of this Note, the Company and any agent of the
Company may treat the Person in whose name this Note is duly registered on the Note Register as the owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or not this Note is overdue, and neither the Company nor any such agent
shall be affected by notice to the contrary.

 

ARTICLE
4

 

4.1
Conversion.

 

(a)
Voluntary Conversion. At any time after the Issuance Date until this Note is no longer outstanding, subject to Section 4.3,
this Note shall be convertible (in whole or in part), at the option of the Holder, into such number of fully paid and non-assessable
shares of Common Stock as is determined by dividing (x) that portion of the Outstanding Principal Amount that the Holder elects to convert
(the “Conversion Amount”) by (y) the Conversion Price then in effect on the date on which the Holder delivers a notice
of conversion, in substantially the form attached hereto as Exhibit B (the “Conversion Notice”), in accordance
with Section 6.1 to the Maker. The Holder shall deliver this Note to the Maker at the address designated in the Purchase Agreement
at such time that this Note is fully converted. With respect to partial conversions of this Note, the Maker shall keep written records
of the amount of this Note converted as of the date of such conversion (each, a “Conversion Date”, and such record,
the “Note Register”). No ink-original Conversion Notice shall be required, nor shall any medallion guarantee (or other
type of guarantee or notarization) of any Conversion Notice form be required. To effect conversions hereunder, the Holder shall not be
required to physically surrender this Note to the Company unless the entire principal amount of this Note, plus all accrued and unpaid
interest thereon, has been so converted. Conversions hereunder shall have the effect of lowering the Outstanding Principal Amount in
an amount equal to the applicable conversion. In the event of any dispute or discrepancy, the records of the Holder shall be controlling
and determinative in the absence of manifest error. The Holder, and any assignee by acceptance of this Note, acknowledge and agree
that, by reason of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted principal
amount of this Note may be less than the amount stated on the face hereof.

 

    	7

     

    

 

(b)
Conversion Price. The “Conversion Price” shall be equal to $1.75 (the “Base Conversion Price”),
as such amount may be adjusted, from time to time, pursuant to the provisions of Section 4.4 hereafter. All such foregoing determinations
will be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or similar transaction that proportionately
decreases or increases the shares of Common Stock during such measuring period. In addition to the foregoing adjustments, if, at any
time while this Note is outstanding, the Company consummates an equity financing pursuant to which it sells Additional Shares of Common
Stock or Common Stock Equivalents (collectively, “Next Round Securities”), with a gross aggregate amount of securities
sold of not less than $10,000,000, excluding any and all indebtedness under this Note that is converted into Next Round Securities, and
with the principal purpose of raising capital; provided, that the Company is listed on a Trading Market that is a senior exchange such
as The NASDAQ Global Market, The NASDAQ Global Select Market, The NASDAQ Capital Market, or the New York Stock Exchange (a “Qualified
Financing”), then the Base Conversion Price, shall automatically adjusted to the lesser of (i) 25% discount to the cash price
per share paid by the other purchasers of Next Round Securities in the Qualified Financing (the “Automatic Conversion Price”)
and (ii) the Conversion Price, subject to Customary Adjustments. Notwithstanding the foregoing, the Conversion Price shall not be adjusted
below the Floor Price other than as the result of the adjustments or readjustments pursuant to Section 4.4 hereof. Nothing herein
shall limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to Article 2 hereof and the
Holder shall have the right to pursue all remedies available to it hereunder, at law or in equity including, without limitation, a decree
of specific performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce
damages pursuant to any other Section hereof or under applicable law

 

(c)
Company Conversion. If at any time following the sixty (60) day anniversary of the final Closing Date or termination of the Offering
and if there is an effective registration statement permitting the issuance of the Conversion Shares to or resale of the Conversion Shares
by the Holder, (A) the Company’s Common Stock is listed on a senior national securities exchange set forth above, (B) the daily
VWAP for the prior twenty (20) consecutive Trading Days is $6.00 or more (adjusted for splits and similar distributions) and (C) the
daily trading volume is at least $1,000,000 during such twenty (20)-day period (the events set forth in clauses (A) through (C) above,
collectively, the “Conditions”), then the Company shall have the right to require the Holder to convert all or any
portion of the principal and accrued interest then remaining under this Note into validly issued, fully paid and non-assessable shares
of Common Stock in accordance with this Section 4.1 at the Conversion Price in effect on the Mandatory Conversion Date (as defined
below) (a “Mandatory Conversion”). The Company may exercise its right to require conversion under this Section
4.1(c) by delivering a written notice thereof by facsimile and overnight courier to the Holder stating (i) the Trading Day selected
for the Mandatory Conversion in accordance with this Section 4.1(c), which Trading Day shall be no sooner than five (5) Trading
Days nor later than ten (10) Trading Days following the date of notice, (ii) the twenty (20) Trading Day period over which the VWAP was
calculated, (iii) the portion of the conversion amount subject to the Mandatory Conversion pursuant to this Section 4.1(c), and
(iv) the number of shares of Common Stock to be issued to the Holder (subject to adjustment for any downward adjustments to the Conversion
Price occurring under this Note after the execution of the Mandatory Conversion notice by the Company).

 

    	8

     

    

 

4.2
Delivery of Conversion Shares. As soon as practicable after any conversion in accordance with this Note and in any event within
two (2) Trading Days thereafter (such date, the “Share Delivery Date”), the Maker shall, at its expense, cause to
be issued in the name of and delivered to the Holder, or as the Holder may direct, a certificate or certificates evidencing the number
of fully paid and non-assessable shares of Common Stock to which the Holder shall be entitled on such conversion (the “Conversion
Shares”), in such denominations as may be requested by the Holder, which certificate or certificates shall be free of restrictive
and trading legends (except for any such legends as may be required under the Securities Act). In lieu of delivering physical certificates
for the shares of Common Stock issuable upon any conversion of this Note, provided the Company’s transfer agent is participating
in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer program or a similar program, upon request
of the Holder, the Company shall cause its transfer agent to electronically transmit such shares of Common Stock issuable upon conversion
of this Note to the Holder (or its designee), by crediting the account of the Holder’s (or such designee’s) broker with DTC
through its Deposit Withdrawal Agent Commission system (provided that the same time periods herein as for stock certificates shall apply)
as instructed by the Holder (or its designee).

 

4.3
Ownership Cap. Notwithstanding anything to the contrary contained herein, the Holder shall not be entitled to receive shares representing
Equity Interests upon conversion of this Note to the extent (but only to the extent) that such exercise or receipt would cause the Holder
Group (as defined below) to become, directly or indirectly, a “beneficial owner” (within the meaning of Section 13(d) of
the 1934 Act and the rules and regulations promulgated thereunder) of a number of Equity Interests of a class that is registered under
the 1934 Act which exceeds the Maximum Percentage (as defined below) of the Equity Interests of such class that are outstanding at such
time. Any purported delivery of Equity Interests in connection with the conversion of this Note prior to the termination of this restriction
in accordance herewith shall be void and have no effect to the extent (but only to the extent) that such delivery would result in the
Holder Group becoming the beneficial owner of more than the Maximum Percentage of the Equity Interests of a class that is registered
under the 1934 Act that is outstanding at such time. If any delivery of Equity Interests owed to the Holder following conversion of this
Note is not made, in whole or in part, as a result of this limitation, the Company’s obligation to make such delivery shall not
be extinguished and the Company shall deliver such Equity Interests as promptly as practicable after the Holder gives notice to the Company
that such delivery would not result in such limitation being triggered or upon termination of the restriction in accordance with the
terms hereof. To the extent limitations contained in this Section 4.3 apply, the determination of whether this Note is convertible
and of which portion of this Note is convertible shall be the sole responsibility and in the sole determination of the Holder, and the
submission of a notice of conversion shall be deemed to constitute the Holder’s determination that the issuance of the full number
of Conversion Shares requested in the notice of conversion is permitted hereunder, and the Company shall not have any obligation to verify
or confirm the accuracy of such determination. For purposes of this Section 4.3, (i) the term “Maximum Percentage”
shall mean 4.99%; provided, that if at any time after the date hereof the Holder Group beneficially owns in excess of 4.99% of any class
of Equity Interests in the Company that is registered under the 1934 Act, then the Maximum Percentage shall automatically increase to
9.99% so long as the Holder Group owns in excess of 4.99% of such class of Equity Interests (and shall, for the avoidance of doubt, automatically
decrease to 4.99% upon the Holder Group ceasing to own in excess of 4.99% of such class of Equity Interests); and (ii) the term “Holder
Group” shall mean the Holder plus any other Person with which the Holder is considered to be part of a group under Section
13 of the 1934 Act or with which the Holder otherwise files reports under Sections 13 and/or 16 of the 1934 Act. In determining the number
of Equity Interests of a particular class outstanding at any point in time, the Holder may rely on the number of outstanding Equity Interests
of such class as reflected in (x) the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q filed with
the Securities and Exchange Commission, as the case may be, (y) a more recent public announcement by the Company or (z) a more recent
notice by the Company or its transfer agent to the Holder setting forth the number of Equity Interests of such class then outstanding.
For any reason at any time, upon written or oral request of the Holder, the Company shall, within one (1) Business Day of such request,
confirm orally and in writing to the Holder the number of Equity Interests of any class then outstanding. Anything herein to the contrary,
any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Company.
The provisions of this Section 4.3 shall be construed, corrected and implemented in a manner so as to effectuate the intended
beneficial ownership limitation herein contained.

 

    	9

     

    

 

4.4
Adjustment of Base Conversion Price.

 

(a)
Until the Note has been paid in full or converted in full, the Base Conversion Price shall
be subject to adjustment from time to time as follows (but shall not be increased, other than pursuant to Section 4.4(a)(i) hereof):

 

(i)
Adjustments for Stock Splits and Combinations. If the Maker shall at any time or from time to time after the Closing Date (but
whether before or after the Issuance Date) effect a split of the outstanding Common Stock, the applicable Base Conversion Price in effect
immediately prior to the stock split shall be proportionately decreased. If the Maker shall at any time or from time to time after the
Closing Date (but whether before or after the Issuance Date), combine the outstanding shares of Common Stock, the applicable Base Conversion
Price in effect immediately prior to the combination shall be proportionately increased. Any adjustments under this Section 4.4(a)(i)
shall be effective at the close of business on the date the stock split or combination occurs.

 

(ii)
Adjustments for Certain Dividends and Distributions. If the Maker shall at any time or from time to time after the Closing Date
(but whether before or after the Issuance Date) make or issue or set a record date for the determination of holders of Common Stock entitled
to receive a dividend or other distribution payable in shares of Common Stock, then, and in each event, the applicable Base Conversion
Price in effect immediately prior to such event shall be decreased as of the time of such issuance or, in the event such record date
shall have been fixed, as of the close of business on such record date, by multiplying the applicable Base Conversion Price then in effect
by a fraction:

 

(1)
the numerator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date; and

 

    	10

     

    

 

(2)
the denominator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of
such issuance or the close of business on such record date plus the number of shares of Common Stock issuable in payment of such dividend
or distribution.

 

(iii)
Adjustment for Other Dividends and Distributions. If the Maker shall at any time or from time to time after the Closing Date (but
whether before or after the Issuance Date) make or issue or set a record date for the determination of holders of Common Stock entitled
to receive a dividend or other distribution payable in other than shares of Common Stock, then, and in each event, an appropriate revision
to the applicable Base Conversion Price shall be made and provision shall be made (by adjustments of the Base Conversion Price or otherwise)
so that the Holder of this Note shall receive upon conversions thereof, in addition to the number of shares of Common Stock receivable
thereon, the number of securities of the Maker or other issuer (as applicable) or other property that it would have received had this
Note been converted into Common Stock in full (without regard to any conversion limitations herein) on the date of such event and had
thereafter, during the period from the date of such event to and including the Conversion Date, retained such securities (together with
any distributions payable thereon during such period) or assets, giving application to all adjustments called for during such period
under this Section 4.4(a)(iii) with respect to the rights of the holders of this Note; provided,
however, that if such record date shall have been fixed and such dividend is not fully paid or if such distribution is not
fully made on the date fixed therefor, the Base Conversion Price shall be adjusted pursuant to this paragraph as of the time of actual
payment of such dividends or distributions.

 

(iv)
Adjustments for Reclassification, Exchange or Substitution. If the Common Stock at any time or from time to time after the Closing
Date (but whether before or after the Issuance Date) shall be changed to the same or different number of shares or other securities of
any class or classes of stock or other property, whether by reclassification, exchange, substitution or otherwise (other than by way
of a stock split or combination of shares or stock dividends provided for in Sections 4.4(a)(i), (ii) and (iii) hereof, or a reorganization,
merger, consolidation, or sale of assets provided for in Section 4.4(a)(v) hereof), then, and in each event, an appropriate revision
to the Base Conversion Price shall be made and provisions shall be made (by adjustments of the Base Conversion Price or otherwise) so
that the Holder shall have the right thereafter to convert this Note into the kind and amount of shares of stock or other securities
or other property receivable upon reclassification, exchange, substitution or other change, by holders of the number of shares of Common
Stock into which such Note might have been converted immediately prior to such reclassification, exchange, substitution or other change,
all subject to further adjustment as provided herein.

 

    	11

     

    

 

(v)
Adjustments for Issuance of Additional Shares of Common Stock. In the event the Maker or any Subsidiary shall at any time or from
time to time after the Closing Date (but whether before or after the Issuance Date) issue or sell any additional shares of Common Stock
or Common Stock Equivalents (“Additional Shares of Common Stock”), other than (A)
as provided in this Note (including the foregoing subsections (i) through (iv) of
this Section 4.4(a)), pursuant to any Equity Plan (including pursuant to Common Stock Equivalents granted or issued under any
Equity Plan), (B) pursuant to Common Stock Equivalents granted or issued prior to the Closing Date, (C) Exempted Securities, or (D) pursuant
to a Qualified Financing, in any case, at an effective price per share that is less than the Base Conversion Price then
in effect or without consideration, (such lower price, the “Base Share Price” and such issuances collectively, a “Dilutive
Issuance”) (it being understood and agreed that if the holder of the Common Stock or Stock Equivalents so issued shall at any
time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise,
or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled to receive Common Stock
at an effective price per share that is less than the Base Conversion Price, such issuance shall be deemed to have occurred for less
than the Base Conversion Price on such date of the Dilutive Issuance at such effective price), then simultaneously with the consummation
of each Dilutive Issuance the Base Conversion Price shall be reduced and only reduced to equal the Base Share Price. Such adjustment
shall be made whenever such Common Stock or Stock Equivalents are issued. The Company shall notify the Holder, in writing, no later than
the Trading Day before the issuance or deemed issuance of any Common Stock or Stock Equivalents subject to this Section 4(a)(v), indicating
therein the applicable issuance price, or applicable reset price, exchange price, conversion price and other pricing terms (such notice,
the “Dilutive Issuance Notice”). For purposes of clarification, whether or not the Company provides a Dilutive Issuance Notice
pursuant to this Section 4(a)(v), upon the occurrence of any Dilutive Issuance, the Holder is entitled to receive a number of Conversion
Shares based upon the Base Share Price regardless of whether the Holder accurately refers to the Base Share Price in the Notice of Conversion.
If the Company enters into a Variable Rate Transaction, despite the prohibition thereon in the Purchase Agreement, the Company shall
be deemed to have issued Common Stock or Stock Equivalents at the lowest possible conversion or exercise price at which such Securities
may be converted or exercised.

 

(vi)
Issuance, Amendment or Adjustment of Common Stock Equivalents. Except for Exempted
Securities, if other than pursuant to a Qualified Financing, (x) the Maker, at any time after the Closing Date (but whether before or
after the Issuance Date), shall issue any securities convertible into or exercisable or exchangeable for, directly or indirectly, Common
Stock (“Convertible Securities”), or any rights or warrants or options to purchase any such Common Stock or Convertible
Securities, other than Common Stock Equivalents granted or issued under any Equity Plan (collectively with the Convertible Securities,
the “Common Stock Equivalents”) and the price per share for which shares of Common Stock may be issuable pursuant
to any such Common Stock Equivalent shall be less than the applicable Base Conversion Price then in effect, or (y) the
price per share for which shares of Common Stock may be issuable under any Common Stock Equivalents is amended or adjusted, pursuant
to the terms of such Common Stock Equivalents or otherwise, and such price as so amended or adjusted shall be less than the applicable
Base Conversion Price in effect at the time of such amendment or adjustment, then, in each such case (x) or (y), the applicable Base
Conversion Price upon each such issuance or amendment or adjustment shall be adjusted as provided in subsection (v) of this Section
4.4(a) as if the maximum number of shares of Common Stock issuable upon conversion, exercise or exchange of such Common Stock Equivalents
had been issued on the date of such issuance or amendment or adjustment.

 

    	12

     

    

 

(vii)
Consideration for Stock. In case any shares of Common Stock or any Common Stock Equivalents shall be issued or sold:

 

(1)
in connection with any merger or consolidation in which the Maker is the surviving corporation (other than any consolidation or merger
in which the previously outstanding shares of Common Stock of the Maker shall be changed to or exchanged for the stock or other securities
of another corporation), the amount of consideration therefor shall be, deemed to be the fair value, as determined reasonably and in
good faith by the Board of Directors of the Maker and approved by the Holder, of such portion of the assets and business of the nonsurviving
corporation as such Board of Directors may determine to be attributable to such shares of Common Stock, Convertible Securities, rights
or warrants or options, as the case may be; or

 

(2)
in the event of any consolidation or merger of the Maker in which the Maker is not the surviving corporation or in which the previously
outstanding shares of Common Stock of the Maker shall be changed into or exchanged for the stock or other securities of another corporation
or other property, or in the event of any sale of all or substantially all of the assets of the Maker for stock or other securities or
other property of any corporation, the Maker shall be deemed to have issued shares of its Common Stock, at a price per share equal to
the valuation of the Maker’s Common Stock based on the actual exchange ratio on which the transaction was predicated, as applicable,
and the fair market value on the date of such transaction of all such stock or securities or other property of the other corporation.
If any such calculation results in adjustment of the applicable Base Conversion Price, or the number of shares of Common Stock issuable
upon conversion of the Note, the determination of the applicable Base Conversion Price or the number of shares of Common Stock issuable
upon conversion of the Note immediately prior to such merger, consolidation or sale, shall be made after giving effect to such adjustment
of the number of shares of Common Stock issuable upon conversion of the Note. In the event Common Stock is issued with other shares or
securities or other assets of the Maker for consideration which covers both, the consideration computed as provided in this Section
4.4(a)(vii) shall be allocated among such securities and assets as determined in good faith by the Board of Directors of the Maker,
and approved by the Holder.

 

(viii)
Record Date. In case the Maker shall take record of the holders of its Common Stock for the purpose of entitling them to subscribe
for or purchase Common Stock or Convertible Securities, then the date of the issue or sale of the shares of Common Stock shall be deemed
to be such record date.

 

(b)
No Impairment. The Maker shall not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, 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 to be observed or performed hereunder by the Maker, but will at all times in good faith assist in
the carrying out of all the provisions of this Section 4.4 and in the taking of all such action as may be necessary or appropriate
in order to protect the conversion rights of the Holder against impairment. In the event the Holder shall elect to convert this Note
as provided herein, the Maker cannot refuse conversion based on any claim that the Holder or anyone associated or affiliated with the
Holder has been engaged in any violation of law, violation of an agreement to which the Holder is a party or for any reason whatsoever,
unless, an injunction from a court, or notice, restraining and or adjoining conversion of this Note shall have issued and the Maker posts
a surety bond for the benefit of the Holder in an amount equal to one-hundred-fifty percent (150%) of the Principal Amount of the Note
the Holder has elected to convert, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and
the proceeds of which shall be payable to the Holder (as liquidated damages) in the event it obtains judgment.

 

    	13

     

    

 

(c)
Certificates as to Adjustments. Upon occurrence of each adjustment or readjustment of the Base Conversion Price or number of shares
of Common Stock issuable upon conversion of this Note pursuant to this Section 4.4, the Maker at its expense shall promptly compute
such adjustment or readjustment in accordance with the terms hereof and furnish to the Holder a certificate setting forth such adjustment
and readjustment, showing in detail the facts upon which such adjustment or readjustment is based. The Maker shall, upon written request
of the Holder, at any time, furnish or cause to be furnished to the Holder a like certificate setting forth such adjustments and readjustments,
the applicable Base Conversion Price in effect at the time, and the number of shares of Common Stock and the amount, if any, of other
securities or property which at the time would be received upon the conversion of this Note.

 

(d)
Issue Taxes. The Maker shall pay any and all issue and other taxes, excluding federal, state or local income taxes, that may be
payable in respect of any issue or delivery of shares of Common Stock on conversion of this Note pursuant thereto; provided,
however, that the Maker shall not be obligated to pay any transfer taxes resulting
from any transfer requested by the Holder in connection with any such conversion.

 

(e)
Fractional Shares. No fractional shares of Common Stock shall be issued upon conversion of this Note. In lieu of any fractional
shares to which the Holder would otherwise be entitled, the Maker shall pay cash equal such fractional shares multiplied by the Conversion
Price then in effect.

 

(f)
Reservation of Common Stock. The Maker shall at all times while this Note shall be outstanding, reserve and keep available out
of its authorized but unissued Common Stock, such number of shares of Common Stock as shall from time to time be sufficient to effect
the conversion of this Note (disregarding for this purpose any and all limitations of any kind on such conversion). The Maker shall,
from time to time, increase the authorized number of shares of Common Stock or take other effective action if at any time the unissued
number of authorized shares shall not be sufficient to satisfy the Maker’s obligations under this Section 4.4(f).

 

(g)
Regulatory Compliance. If any shares of Common Stock to be reserved for the purpose of conversion of this Note require registration
or listing with or approval of any governmental authority, stock exchange or other regulatory body under any federal or state law or
regulation or otherwise (including pursuant to Section 3.1 hereof) before such shares may be validly issued or delivered upon
conversion, the Maker shall, at its sole cost and expense, in good faith and as expeditiously as possible, secure such registration,
listing or approval, as the case may be.

 

    	14

     

    

 

(h)
Effect of Events Prior to the Issuance Date. If the Issuance Date of this Note is after the Closing Date, then, if the Base Conversion
Price or any other right of the Holder of this Note would have been adjusted or modified by operation of any provision of this Note had
this Note been issued on the Closing Date, such adjustment or modification shall be deemed to apply to this Note as of the Issuance Date
as if this Note had been issued on the Closing Date.

 

4.5
Inability to Fully Convert.

 

(a)
Holder’s Option if Maker Cannot Fully Convert. If, upon the Maker’s receipt of a Conversion Notice or as otherwise
required under this Note, the Maker cannot issue shares of Common
Stock for any reason, including, without limitation,
because the Maker (x)
does not have
a sufficient number of shares of
Common Stock authorized and available or
(y) is otherwise prohibited by applicable law or
by the rules or regulations of any stock
exchange, interdealer quotation system or
other self-regulatory organization with jurisdiction over the Maker or any of its securities
from issuing all of the Common Stock which is to be issued to the Holder pursuant to this
Note, then the Maker shall issue as many shares of Common Stock as it is able to issue
and, with respect to the unconverted portion of
this Note or with respect to any shares of Common Stock not timely issued in accordance with this
Note, the Holder, solely at Holder’s
option, can elect to:

 

(i)
void its Conversion Notice and retain or have returned, as the case may be, this Note that was to be converted pursuant to the Conversion
Notice (provided that the Holder’s voiding its Conversion Notice shall not affect the Maker’s obligations to make any payments
which have accrued prior to the date of such notice); or

 

(ii)
defer issuance of the applicable Conversion Shares until such time as the Maker can legally issue such shares; provided, that the Principal
Amount underlying such Conversion Shares shall remain outstanding until the delivery of such Conversion Shares; provided, further, that
if the Holder elects to defer the issuance of the Conversion Shares, it may exercise its rights under either clause (i) or (ii) above
at any time prior to the issuance of the Conversion Shares upon two (2) Business Days’ notice to the Maker.

 

(b)
Mechanics of Fulfilling Holder’s Election. The Maker shall immediately send to
the Holder, upon receipt of a Conversion Notice from the Holder, which cannot be fully satisfied
as described in Section 4.5(a) above, a notice of the Maker’s inability to fully
satisfy the Conversion Notice (the “Inability to Fully Convert Notice”). Such Inability to Fully Convert Notice shall
indicate (i) the reason why the Maker is unable to fully satisfy the Holder’s Conversion Notice; and (ii) the amount of this Note
which cannot be converted. The Holder
shall notify the Maker of its election pursuant
to Section 4.5(a) above by delivering written notice to the Maker (“Notice
in Response to Inability to Convert”).

 

    	15

     

    

 

4.6
Rights as Stockholder.
The Holder shall be entitled to vote with the shares of Common Stock, on an as-converted to
Common Stock basis, with respect to all corporate matters of the Maker on which the holders of Common Stock are entitled to vote, subject
to any applicable Beneficial Ownership Limitations.

 

ARTICLE
5

 

5.1
Covenants. For so long as any Note is outstanding, without the prior written consent
of the Holder:

 

(a)
Compliance with Transaction Documents. The Maker shall, and shall cause its Subsidiaries to,
comply with its obligations under this Note and the other Transaction Documents.

 

(b)
Payment of Taxes, Etc. The Maker shall, and shall cause each of its Subsidiaries to, promptly pay and discharge, or cause to be
paid and discharged, when
due and payable, all lawful
taxes, assessments and governmental charges
or levies imposed upon
the income, profits, property or business of the Maker and the Subsidiaries, except
for such failures to pay that, individually or in the aggregate, have not had and would not
reasonably be expected to have a Material Adverse Effect; provided, however, that any such tax, assessment, charge or levy
need not be paid if the validity thereof shall currently be contested in good faith by appropriate proceedings and if the Maker or such
Subsidiaries shall have set aside on its books
adequate reserves with respect thereto, and provided, further, that the
Maker and such Subsidiaries will pay all such
taxes, assessments, charges or levies forthwith upon the commencement of proceedings to foreclose any lien which may have attached
as security therefor.

 

(c)
Corporate Existence. The Maker shall, and shall cause each of its Subsidiaries to, maintain in full force and effect its corporate
existence, rights and franchises and all licenses and other rights to use property owned or possessed by it and reasonably deemed to
be necessary to the conduct of its business.

 

(d)
Investment Company Act. The Maker
shall conduct its businesses in a manner so
that it will
not become subject to, or required to be registered under, the
Investment Company Act of 1940, as amended.

 

(e)
Sale of Collateral; Liens. From the date hereof until the full release of the security interest in the Collateral and the “Collateral”
(as such term is defined in the Subsidiary Security Agreement) (the “Subsidiary Collateral”), (i) the
Maker shall not, and shall not permit any of its Subsidiaries to, sell, lease, transfer or
otherwise dispose of any of the Collateral, or
attempt or contract to do so or permit any of its
Subsidiaries to attempt or contract to do so, other than sales of inventory in the ordinary course of business consistent with past practices;
and (ii) the Maker shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, create, permit or suffer
to exist, and shall defend, and cause its Subsidiaries
to defend, the Collateral against and take such
other action, as is necessary to remove, any
lien, security interest or other encumbrance on
the Collateral and the Subsidiary Collateral (except for the pledge, assignment and security interest created under the Security Agreement,
the Subsidiary Security Agreement, any Permitted Liens
(as defined in
the Security Agreement) or any “Permitted
Lien” (as defined in the Subsidiary Security Agreement)).

 

    	16

     

    

 

(f)
Prohibited Transactions. The Company hereby covenants and agrees not to enter into any Prohibited Transactions until thirty (30)
days after such time as this Note has been converted into Conversion Shares or repaid in full.

 

5.2
Set-Off. This Note shall be subject to the set-off provisions set forth in the Purchase Agreement.

 

ARTICLE
6

 

6.1
Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in
writing and shall be deemed given and effective on the earliest of (a) the date of transmission, if such notice or communication is delivered
via email at the email address specified in this Section prior to 5:00 p.m. (New York time) on a Business Day, (b) the next Business
Day after the date of transmission, if such notice or communication is delivered via email at the email address specified in this Section
on a day that is not a Business Day or later than 5:00 p.m. (New York time) on any date and earlier than 11:59 p.m. (New York time) on
such date, (c) the Business Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (d)
upon actual receipt by the party to whom such notice is required to be given. The addresses for notice shall be as set forth in the Purchase
Agreement.

 

6.2
Governing Law. This Agreement shall be governed by and construed in accordance with the Laws of the State of Nevada, without reference
to principles of conflict of laws or choice of laws. This Note shall not be interpreted or construed with any presumption against the
party causing this Note to be drafted.

 

6.3
Headings. Article and section headings in this Note are included herein for purposes
of convenience of reference only and shall not constitute a part of this Note for any other
purpose.

 

6.4
Remedies, Characterizations, Other Obligations, Breaches and
Injunctive Relief.
The remedies provided in
this Note shall be
cumulative and in addition to all other remedies available under this Note, at law or in equity (including, without limitation,
a decree of specific performance and/or other injunctive relief), no remedy contained herein shall be deemed a waiver of compliance with
the provisions giving rise to such remedy and nothing herein shall limit the Holder’s right to pursue actual damages for any failure
by the Maker to comply with the terms of this Note. Amounts set
forth or provided
for herein with
respect to payments,
conversion and the like (and the computation thereof)
shall be the amounts
to be received by the holder thereof and
shall not, except as expressly provided herein, be
subject to any other obligation of the Maker
(or the performance thereof). The Maker acknowledges that a breach by it of its obligations hereunder will cause irreparable and
material harm to the Holder and that the remedy at law for any such breach would be inadequate. Therefore, the Maker agrees that, in
the event of any such breach or threatened breach, the
Holder shall be entitled, in addition
to all other available rights and remedies, at
law or in equity, to equitable relief,
including but not limited to an injunction
restraining any such breach or threatened breach,
without the necessity of showing economic loss
and without any bond or other security being required.

 

    	17

     

    

 

6.5
Enforcement Expenses. The Maker agrees to pay all costs and expenses of enforcement of this Note, including, without limitation,
reasonable attorneys’ fees and expenses.

 

6.6
Binding Effect. The obligations of
the Maker and
the Holder set forth
herein shall be binding upon
the successors and assigns
of each such party, whether or not such successors or assigns are permitted by the
terms herein.

 

6.7
Amendments; Waivers. No provision of this Note may be waived or amended except in a written instrument signed by the Company and
the Holder. No waiver of any default with respect to any provision, condition or requirement of this Note shall be deemed to be a continuing
waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall
any delay or omission of either party to exercise any right hereunder in any manner impair the exercise of any such right.

 

6.8
Compliance with Securities Laws. The Holder of this Note acknowledges that this Note is being acquired solely for the Holder’s
own account and not as a nominee for any other party, and for investment, and that the Holder
shall not offer, sell or otherwise dispose of this Note in violation of securities laws. This Note and any Note issued in substitution
or replacement therefor shall be stamped or imprinted with a legend in substantially the following form:

 

“THIS
NOTE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT
BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY.”

 

    	18

     

    

 

6.9
Jurisdiction; Venue. Any action, proceeding or claim arising out of, or relating in
any way to this Agreement shall be brought and enforced in the Nevada State Court or in the United States District Court sitting in Clark
County, Nevada. The Company and the Holder irrevocably submit to the jurisdiction of such courts, which jurisdiction shall be exclusive,
and hereby waive any objection to such exclusive jurisdiction or that such courts represent an inconvenient forum. The prevailing party
in any such action shall be entitled to recover its reasonable and documented attorneys’ fees and out-of-pocket expenses relating
to such action or proceeding.

 

6.10
Parties in Interest. This Note shall be binding upon, inure to the benefit of and be enforceable by the Maker, the Holder and
their respective successors and permitted assigns.

 

6.11
Failure or Indulgence Not Waiver.
No failure or delay on the
part of the Holder
in the exercise of any
power, right or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other right, power or privilege.

 

6.12
Maker Waivers. Except as otherwise specifically
provided herein, the Maker and all others that
may become liable for all or any part of the obligations evidenced by this Note, hereby
waive presentment, demand, notice of nonpayment, protest and all other demands and notices
in connection with the delivery,
acceptance, performance and enforcement of
this Note, and do hereby
consent to any number of renewals
of extensions of the time or payment
hereof and agree that any such renewals or
extensions may be made without notice to
any such persons and without affecting their liability herein and do further consent to the release of any person liable hereon,
all without affecting the liability of the other persons, firms or Maker liable for the payment of this Note, AND DO HEREBY WAIVE TRIAL
BY JURY.

 

(a)
No delay or omission on the part of the Holder in exercising its rights under this Note, or course of conduct relating hereto, shall
operate as a waiver of such rights or any other right of the Holder, nor shall any waiver by the Holder of any such right or rights on
any one occasion be deemed a waiver of the same right or rights on any future occasion.

 

(b)
THE MAKER ACKNOWLEDGES THAT THE TRANSACTION OF WHICH THIS NOTE IS A PART IS A COMMERCIAL TRANSACTION,
AND TO THE EXTENT
ALLOWED BY APPLICABLE LAW, HEREBY
WAIVES ITS RIGHT TO NOTICE
AND HEARING WITH RESPECT
TO ANY PREJUDGMENT
REMEDY WHICH THE HOLDER
OR ITS SUCCESSORS
OR ASSIGNS MAY
DESIRE TO USE.

 

6.13
Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless the Company
has in good faith determined that the matters relating to such notice do not constitute material, nonpublic information relating to the
Company or its Subsidiaries, the Company shall within two (2) Business Days after such receipt or delivery publicly disclose such material,
nonpublic 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 its Subsidiaries, the Company so shall indicate to the Holder contemporaneously with
delivery of such notice, and in the absence of any such indication, upon the passage of two (2) Business Days, the Holder shall be allowed
to presume that all matters relating to such notice do not constitute material, nonpublic information relating to the Company or its
Subsidiaries.

 

    	19

     

    

 

6.14
Definitions. Capitalized terms used herein and
not defined shall have the meanings
set forth in the
Purchase Agreement. For the purposes hereof,
the following terms shall have the following meanings:

 

(a)
“Customary Antidilution Adjustments” means customary anti-dilution protection for stock splits, stock dividends, stock
combinations, recapitalizations and similar transactions.

 

(b)
“Indebtedness” means: (a) all obligations for borrowed money; (b) all obligations
evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations in respect of letters
of credit, bankers acceptances, current swap agreements, interest rate
hedging agreements, interest rate swaps,
or other financial products; (c)
all capital lease obligations that exceed
$100,000 in the aggregate in any fiscal year;
(d) all obligations or liabilities secured by a lien or encumbrance on any asset of the Maker, irrespective of whether such
obligation or liability is assumed; (e)
all obligations for the deferred purchase price of
assets, together with trade debt and other accounts
payable that exceed $100,000 in the aggregate in any fiscal year; (f) all synthetic leases; (g) any obligation guaranteeing or
intended to guarantee (whether directly or indirectly
guaranteed, endorsed, co-made, discounted or sold
with recourse) any of the foregoing
obligations of any other person; (h) trade
debt; and (i) endorsements for collection or deposit.

 

(c)
“Mandatory Default Amount” means an amount equal to one hundred and thirty-five percent (135%) of the Outstanding
Principal Amount of this Note on the date on which the first Event of Default has occurred hereunder.

 

(d)
“Market Capitalization” means, as of any date of determination, the product of (a) the number of issued and outstanding
shares of Common Stock as of such date (exclusive of any shares of common stock issuable upon the exercise of options or warrants or
conversion of any convertible securities), multiplied by (b) the closing price of the Common Stock on the Trading Market on the date
of determination.

 

(e)
“Outstanding Principal Amount” means, at the time of determination, the Principal Amount outstanding after giving
effect to any conversions or prepayments pursuant to the terms hereof.

 

(f)
“Registration Rights Agreement” means the Registration Rights Agreement, dated as of June 17, 2022 (as the same may
be amended from time to time), by and between the Company and the Holder.

 

(g)
“Trading Market” means any of the following markets or exchanges on which the Common Stock (or any other common stock
of any other Person that references the Trading Market for its common stock) is listed or quoted for trading on the date in question:
the OTC Bulletin Board, The NASDAQ Global Market, The NASDAQ Global Select Market, The NASDAQ Capital Market, the New York Stock Exchange,
NYSE Arca, the NYSE MKT, or the OTCQX Marketplace, the OTCQB Marketplace, the OTC Pink Marketplace or any other tier operated by OTC
Markets Group Inc. (or any successor to any of the foregoing).

 

    	20

     

    

 

(h)
“Trading Day” means a day on which the Common Stock is traded on a Trading Market.

 

(i)
“VWAP” means, for or as of any date, the dollar volume-weighted average price for such security on the Trading Market
(or, if the Trading 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 4:02 p.m., New York
time, as reported by Bloomberg through its “HP” function (set to weighted average) or, if the foregoing does not apply, the
dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board for such security
during the period beginning at 9:30 a.m., New York time, and ending at 4:02 p.m., New York time, as reported by Bloomberg, or, if no
dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid
price and the lowest closing ask price of any of the market makers for such security as reported in the “pink sheets” by
OTC Markets Group Inc. (formerly Pink Sheets LLC). If the VWAP cannot be calculated for such security on such date on any of the foregoing
bases, the VWAP of such security on such date shall be the fair market value as mutually determined by the Company and the Holder. All
such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other
similar transaction during such period.

 

[Signature
Pages Follow]

 

    	21

     

    

 

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

 

	 	MARIZYME,
    INC.
	 	 	 
	 	By:	 
	 	Name:	David
    Barthel
	 	Title:	Chief
    Executive Officer

 

    	 

     

    

 

EXHIBIT
A 

 

WIRE
INSTRUCTIONS

 

    	 

     

    

 

EXHIBIT
B

 

FORM
OF CONVERSION
NOTICE

 

(To
be Executed by the Registered Holder in order to Convert the Note)

 

The
undersigned hereby irrevocably elects to convert $ ________________ of the principal amount of the above Note No. ___ into shares of
Common Stock of Marizyme, Inc. (the “Maker”) according to the conditions hereof, as of the date written below.

 

Date
of Conversion:

 

Conversion
Price:

 

Number
of shares of Common Stock beneficially owned or deemed beneficially owned by the Holder on the Conversion Date:

 

	 	[HOLDER]
	 	 	 
	 	By:	               
	 	Name: 	 
	 	Title:	 
	 	 	 
	 	Address:

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