Document:

Filed by Avantafile.com - Homeland Resources Ltd. - Exhibit 10.1

  SECURITIES PURCHASE AGREEMENT
  

 This SECURITIES
PURCHASE AGREEMENT (the
“Agreement”), dated as of September 8, 2014, by and
between HOMELAND RESOURCES LTD.,
a Nevada corporation, with headquarters located at 9120 Double Diamond Parkway H269,
Reno, NV 89521 (the “Company”), and KBM
WORLDWIDE, INC., a New York
corporation, with its address at 80 Cuttermill Road, Suite 410, Great
Neck, NY 11021 (the “Buyer”).

  WHEREAS:

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

       B. Buyer desires to purchase and the Company
  desires to issue and sell, upon the terms and conditions set forth
  in this Agreement an 8% convertible note of the Company, in the
  form attached hereto as Exhibit A, in the aggregate principal
  amount of $88,500.00 (together with any note(s) issued in
  replacement thereof or as a dividend thereon or otherwise with
  respect thereto in accordance with the terms thereof, the “Note”),
  convertible into shares of common stock, $0.0001 par value per
  share, of the Company (the “Common Stock”), upon the
  terms and subject to the limitations and conditions set forth in
  such Note. 

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

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

1. Purchase and Sale of Note.  

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

b. Form of Payment.
  On the Closing Date (as defined below),  the Buyer shall pay
  the purchase price for the Note to be issued and sold to it at
  the Closing (as defined below) (the “Purchase Price”)
  by wire transfer of immediately available funds to the Company,
  in accordance with the Company’s written wiring
  instructions, against delivery of the Note in the principal
  amount equal to the Purchase Price as is set forth immediately
  below the Buyer’s name on the signature pages hereto, and
   the Company shall deliver such duly executed Note on
  behalf of the Company, to the Buyer, against delivery of such
  Purchase Price. 

c. Closing Date.
  Subject to the satisfaction (or written waiver) of the
  conditions thereto set forth in Section 6 and Section 7 below,
  the date and time of the issuance and sale of the Note pursuant
  to this Agreement (the “Closing Date”) shall be 12:00
  noon, Eastern Standard Time on or about
  September 12, 2014, or such other mutually agreed upon time.  The
  closing of the transactions contemplated by this Agreement (the
  “Closing”) shall occur on the Closing Date at such
  location as may be agreed to by the parties. 

2. Buyer’s Representations and
  Warranties.  The Buyer represents
  and warrants to the Company that:  

a. Investment Purpose.
  As of the date hereof, the Buyer is purchasing the Note and the
  shares of Common Stock issuable upon conversion of or otherwise
  pursuant to the Note (including, without limitation, such
  additional shares of Common Stock, if any, as are issuable  on
  account of interest on the Note,  as a result of the
  events described in Sections 1.3 and 1.4(g) of the Note or  in
  payment of the Standard Liquidated Damages Amount (as defined in
  Section 2(f) below) pursuant to this Agreement, such shares of
  Common Stock being collectively referred to herein as the
  “Conversion Shares” and, collectively with the Note,
  the “Securities”) for its own account and not with a
  present view towards the public sale or distribution thereof,
  except pursuant to sales registered or exempted from registration
  under the 1933 Act; provided,
  however,
  that by making the representations herein, the Buyer does not
  agree to hold any of the Securities for any minimum or other
  specific term and reserves the right to dispose of the Securities
  at any time in accordance with or pursuant to a registration
  statement or an exemption under the 1933 Act.

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

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

2

 
d. Information.
  The Buyer and its advisors, if any, have been, and for so long
  as the Note remain outstanding will continue to be, furnished
  with all materials relating to the business, finances and
  operations of the Company and materials relating to the offer and
  sale of the Securities which have been requested by the Buyer or
  its advisors.  The Buyer and its advisors, if any, have been, and
  for so long as the Note remain outstanding will continue to be,
  afforded the opportunity to ask questions of the Company.
  Notwithstanding the foregoing, the Company has not disclosed to
  the Buyer any material nonpublic information and will not
  disclose such information unless such information is disclosed to
  the public prior to or promptly following such disclosure to the
  Buyer.  Neither such inquiries nor any other due diligence
  investigation conducted by Buyer or any of its advisors or
  representatives shall modify, amend or affect Buyer’s right
  to rely on the Company’s representations and warranties
  contained in Section 3 below.  The Buyer understands that its
  investment in the Securities involves a significant degree of
  risk. The Buyer is not aware of any facts that may constitute a
  breach of any of the Company's representations and warranties
  made herein.

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

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

3

 
 terms and conditions of any exemption thereunder
  (in each case).  Notwithstanding the foregoing or anything else
  contained herein to the contrary, the Securities may be pledged
  as collateral in connection with a bona
  fide margin account or other lending arrangement.

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

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

  

The
legend set forth above shall be removed and the Company shall issue a
certificate without such legend to the holder of any Security upon
which it is stamped, if, unless otherwise required by applicable
state securities laws, (a) such Security is registered for sale under
an effective registration statement filed under the 1933 Act or
otherwise may be sold pursuant to Rule 144 or Regulation S without
any restriction as to the number of securities as of a particular
date that can then be immediately sold, or (b) such holder provides
the Company with an opinion of 

4

 
counsel, in form, substance and scope
  customary for opinions of counsel in comparable transactions, to the
  effect that a public sale or transfer of such Security may be made
  without registration under the 1933 Act, which opinion shall be
  accepted by the Company so that the sale or transfer is effected.
  The Buyer agrees to sell all Securities, including those represented
  by a certificate(s) from which the legend has been removed, in
  compliance with applicable prospectus delivery requirements, if any.
  In the event that the Company does not accept the opinion of counsel
  provided by the Buyer with respect to the transfer of Securities
  pursuant to an exemption from registration, such as Rule 144 or
  Regulation S, at the Deadline,
  it will be considered an Event of
  Default pursuant to Section 3.2 of the Note.

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

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

  3. Representations and Warranties of the
  Company.  The Company represents
  and warrants to the Buyer that:  

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

b. Authorization; Enforcement.
  (i) The Company has all requisite corporate power and authority
  to enter into and perform this Agreement, the Note and to
  consummate the transactions contemplated hereby and thereby and
  to issue the Securities, in accordance with the terms hereof and
  thereof, (ii) the execution and delivery of this Agreement, the
  Note by the Company and the consummation by it of the
  transactions contemplated hereby and thereby (including without
  limitation, the issuance of the Note and the issuance and
  reservation for issuance of the Conversion Shares issuable upon
  conversion or exercise thereof) have been duly authorized by the
  Company’s Board of Directors and no further consent or
  authorization of the Company, its Board of Directors, or its
  shareholders is required, (iii) this Agreement has been duly
  executed and delivered by the Company by its authorized
  representative, and such authorized representative is the true
  and official representative with authority to sign this Agreement
  and the other documents executed in connection herewith and bind
  the Company accordingly, and (iv) this Agreement constitutes, and
  upon execution and delivery by the Company of the Note, each of
  such instruments will constitute, a legal, valid and binding
  obligation of the Company enforceable against the Company in
  accordance with its terms. 

5

 
c. Capitalization.
  As of the date hereof, the authorized capital stock of the
  Company consists of: (i) 500,000,000
  authorized shares
  of Common Stock, $0.0001 par value per share, of which 161,109,142
  shares are issued and outstanding; and (ii) 250,000,000
  authorized shares of Preferred Stock, $0.0001 par value per
  share, of which no shares are issued and outstanding; no shares are reserved for
  issuance pursuant to the Company’s stock option plans, no
  shares are reserved for issuance pursuant to securities (other
  than the Note) exercisable for, or convertible into or
  exchangeable for shares of Common Stock and 12,000,000 shares are
  reserved for issuance upon conversion of the Note.  All of such
  outstanding shares of capital stock are, or upon issuance will
  be, duly authorized, validly issued, fully paid and
  non-assessable.  No shares of capital stock of the Company are
  subject to preemptive rights or any other similar rights of the
  shareholders of the Company or any liens or encumbrances imposed
  through the actions or failure to act of the Company.  As of the
  effective date of this Agreement, (i) there are no outstanding
  options, warrants, scrip, rights to subscribe for, puts, calls,
  rights of first refusal, agreements, understandings, claims or
  other commitments or rights of any character whatsoever relating
  to, or securities or rights convertible into or exchangeable for
  any shares of capital stock of the Company , or arrangements by
  which the Company is or may become bound to issue additional
  shares of capital stock of the Company, (ii) there are no
  agreements or arrangements under which the Company is obligated
  to register the sale of any of its or their securities under the
  1933 Act and (iii) there are no anti-dilution or price adjustment
  provisions contained in any security issued by the Company (or in
  any agreement providing rights to security holders) that will be
  triggered by the issuance of the Note or the Conversion Shares.
  The Company has furnished to the Buyer true and correct copies of
  the Company’s Certificate of Incorporation as in effect on
  the date hereof (“Certificate of Incorporation”), the
  Company’s By-laws, as in effect on the date hereof (the
  “By-laws”), and the terms of all securities
  convertible into or exercisable for Common Stock of the Company
  and the material rights of the holders thereof in respect
  thereto.  The Company shall provide the Buyer with a written
  update of this representation signed by the Company’s Chief
  Executive on behalf of the Company as of the Closing Date. 

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

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

6

 
f. No Conflicts.
  The execution, delivery and performance of this Agreement, the
  Note by the Company and the consummation by the Company of the
  transactions contemplated hereby and thereby (including, without
  limitation, the issuance and reservation for issuance of the
  Conversion Shares) will not (i) conflict with or result in a
  violation of any provision of the Certificate of Incorporation or
  By-laws, or (ii) violate or conflict with, or result in a breach
  of any provision of, or constitute a default (or an event which
  with notice or lapse of time or both could become a default)
  under, or give to others any rights of termination, amendment,
  acceleration or cancellation of, any agreement, indenture,
  patent, patent license or instrument to which the Company is a
  party, or (iii)  result in a violation of any law, rule,
  regulation, order, judgment or decree (including federal and
  state securities laws and regulations and regulations of any
  self-regulatory organizations to which the Company or its
  securities are subject) applicable to the Company or by which any
  property or asset of the Company is bound or affected (except for
  such conflicts, defaults, terminations, amendments,
  accelerations, cancellations and violations as would not,
  individually or in the aggregate, have a Material Adverse
  Effect).  Neither the Company  is not
  in violation of its
  Certificate of Incorporation, By-laws or other organizational
  documents and the Company  is not
  in default (and no event has
  occurred which with notice or lapse of time or both could put the
  Company in default) under, and neither the Company has
  not taken any action or
  failed to take any action that would give to others any rights of
  termination, amendment, acceleration or cancellation of, any
  agreement, indenture or instrument to which the Company is a
  party or by which any property or assets of the Company is bound
  or affected, except for possible defaults as would not,
  individually or in the aggregate, have a Material Adverse Effect.
  The business of the Company, if any, are not being conducted, and
  shall not be conducted so long as the Buyer owns any of the
  Securities, in violation of any law, ordinance or regulation of
  any governmental entity.  Except as specifically contemplated by
  this Agreement and as required under the 1933 Act and any
  applicable state securities laws, the Company is not required to
  obtain any consent, authorization or order of, or make any filing
  or registration with, any court, governmental agency, regulatory
  agency, self regulatory organization or stock market or any third
  party in order for it to execute, deliver or perform any of its
  obligations under this Agreement, the Note in accordance with the
  terms hereof or thereof or to issue and sell the Note in
  accordance with the terms hereof and to issue the Conversion
  Shares upon conversion of the Note.  All consents,
  authorizations, orders, filings and registrations which the
  Company is required to obtain pursuant to the preceding sentence
  have been obtained or effected on or prior to the date hereof.
  If the Company is listed on the
  OTCBB, the Company is not in
  violation of the listing requirements of the Over-the-Counter
  Bulletin Board (the “OTCBB”) and does not reasonably
  anticipate that the Common Stock will be delisted by the OTCBB in
  the foreseeable future.  The Company are unaware of any facts or
  circumstances which might give rise to any of the foregoing.

g. SEC Documents; Financial Statements.
  The Company has timely filed all reports, schedules, forms,
  statements and other documents required to be filed by it with
  the SEC pursuant to the reporting requirements of the Securities
  Exchange Act of 1934, as amended

7

 
 (the “1934 Act”)
  (all of the foregoing filed prior to the date hereof and all
  exhibits included therein and financial statements and schedules
  thereto and documents (other than exhibits to such documents)
  incorporated by reference therein, being hereinafter referred to
  herein as the “SEC Documents”).  Upon written request
  the Company will deliver to the Buyer true and complete copies of
  the SEC Documents, except for such exhibits and incorporated
  documents.  As of their respective dates, the SEC Documents
  complied in all material respects with the requirements of the
  1934 Act and the rules and regulations of the SEC promulgated
  thereunder applicable to the SEC Documents, and none of the SEC
  Documents, at the time they were filed with the SEC, contained
  any untrue statement of a material fact or omitted to state a
  material fact required to be stated therein or necessary in order
  to make the statements therein, in light of the circumstances
  under which they were made, not misleading.  None of the
  statements made in any such SEC Documents is, or has been,
  required to be amended or updated under applicable law (except
  for such statements as have been amended or updated in subsequent
  filings prior the date hereof).  As of their respective dates,
  the financial statements of the Company included in the SEC
  Documents complied as to form in all material respects with
  applicable accounting requirements and the published rules and
  regulations of the SEC with respect thereto.  Such financial
  statements have been prepared in accordance with United States
  generally accepted accounting principles, consistently applied,
  during the periods involved  and fairly present in all material
  respects the financial position of the Company as of the dates
  thereof and the results of their operations and cash flows for
  the periods then ended (subject, in the case of unaudited
  statements, to normal year-end audit adjustments).  Except as set
  forth in the financial statements of the Company included in the
  SEC Documents, the Company has no liabilities, contingent or
  otherwise, other than (i) liabilities incurred in the ordinary
  course of business subsequent to April 30, 2014, and (ii)
  obligations under contracts and commitments incurred in the
  ordinary course of business and not required under generally
  accepted accounting principles to be reflected in such financial
  statements, which, individually or in the aggregate, are not
  material to the financial condition or operating results of the
  Company. The Company is subject to the reporting requirements of
  the 1934 Act.

h. Absence of Certain Changes.
  Except as may be
  disclosed in the Company’s filings in Form 8-K made since
  the date of filing of the Company’s Form 10-Q for the
  period endedApril 30, 2014,
  there has been no material adverse change and no material adverse
  development in the assets, liabilities, business, properties,
  operations, financial condition, results of operations, prospects
  or 1934 Act reporting status of the Company or any of its
Subsidiaries.

 i. Absence of Litigation.
  There is no action, suit, claim, proceeding, inquiry or
  investigation before or by any court, public board, government
  agency, self-regulatory organization or body pending or, to the
  knowledge of the Company , threatened against or affecting the
  Company, or their officers or directors in their capacity as
  such, that could have a Material Adverse Effect.  Schedule 3(i)
  contains a complete list and summary description of any pending
  or, to the knowledge of the Company, threatened proceeding
  against or affecting the

8

 
 Company or any of its Subsidiaries,
  without regard to whether it would have a Material Adverse
  Effect.  The Company is
  unaware of any facts or circumstances which might give rise to
  any of the foregoing.

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

k. No Materially Adverse Contracts, Etc.
  The
  Company  is not
  subject to any charter,
  corporate or other legal restriction, or any judgment, decree,
  order, rule or regulation which in the judgment of the Company’s
  officers has or is expected in the future to have a Material
  Adverse Effect.  The
  Company is not a
  party to any contract or agreement which in the judgment of the
  Company’s officers has or is expected to have a Material
  Adverse Effect.

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

m. Certain Transactions.
  Except for arm’s length transactions pursuant to which the
  Company  makes payments in the ordinary course of business upon
  terms no less favorable than the Company could obtain from third
  parties and other than the grant of stock options disclosed on
  Schedule 3(c), none of the officers, directors, or employees of
  the Company

9

 
 is presently a party to any transaction with the
  Company  (other than for services as employees, officers and
  directors), including any contract, agreement or other
  arrangement providing for the furnishing of services to or by,
  providing for rental of real or personal property to or from, or
  otherwise requiring payments to or from any officer, director or
  such employee or, to the knowledge of the Company, any
  corporation, partnership, trust or other entity in which any
  officer, director, or any such employee has a substantial
  interest or is an officer, director, trustee or partner. 

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

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

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

10

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

r. Permits; Compliance.
  The Company is in possession of all franchises, grants,
  authorizations, licenses, permits, easements, variances,
  exemptions, consents, certificates, approvals and orders
  necessary to own, lease and operate its properties and to carry
  on its business as it is now being conducted (collectively, the
  “Company Permits”), and there is no action pending
  or, to the knowledge of the Company, threatened regarding
  suspension or cancellation of any of the Company Permits.  The
  Company is not in
  conflict with, or in default or violation of, any of the Company
  Permits, except for any such conflicts, defaults or violations
  which, individually or in the aggregate, would not reasonably be
  expected to have a Material Adverse Effect.  Since April 30, 2014,
  the Company has not
  received any notification
  with respect to possible conflicts, defaults or violations of
  applicable laws, except for notices relating to possible
  conflicts, defaults or violations, which conflicts, defaults or
  violations would not have a Material Adverse Effect.

s. Environmental Matters.

(i) There are, to the Company’s
    knowledge, with respect to the Company or any predecessor of the
    Company, no past or present violations of Environmental Laws (as
    defined below), releases of any material into the environment,
    actions, activities, circumstances, conditions, events,
    incidents, or contractual obligations which may give rise to any
    common law environmental liability or any liability under the
    Comprehensive Environmental Response, Compensation and Liability
    Act of 1980 or similar federal, state, local or foreign laws and
    the Company has not received any notice with respect to any of
    the foregoing, nor is any action pending or, to the Company’s
    knowledge, threatened in connection with any of the foregoing.
    The term “Environmental Laws” means all federal,
    state, local or foreign laws relating to pollution or protection
    of human health or the environment (including, without
    limitation, ambient air, surface water, groundwater, land
    surface or subsurface strata), including, without limitation,
    laws relating to emissions, discharges, releases or threatened
    releases of chemicals, pollutants contaminants, or toxic or
    hazardous substances or wastes (collectively, “Hazardous
    Materials”) into the environment, or otherwise relating to
    the manufacture, processing, distribution, use, treatment,
    storage, disposal, transport or handling of Hazardous Materials,
    as well as all authorizations, codes, decrees, demands or demand
    letters, injunctions, judgments, licenses, notices or notice
    letters, orders, permits, plans or regulations issued, entered,
promulgated or approved thereunder. 

(ii) Other than those that are or were stored, used or disposed of in
    compliance with applicable law, no Hazardous Materials are
    contained on or about any real property currently owned, leased
    or used by the Company , and no Hazardous Materials were
    released on or about any real property previously owned, leased
    or used by the Company during 

11

 
the period the property was owned,
    leased or used by the Company, except in the normal course of
    the Company’s or any of its Subsidiaries’ business. 

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

 t. Title to Property.
  The Company has
  good and marketable title in fee simple to all real property and
  good and marketable title to all personal property owned by them
  which is material to the business of the Company , in each case
  free and clear of all liens, encumbrances and defects except such
  as are described in Schedule 3(t) or such as would not have a
  Material Adverse Effect.  Any real property and facilities held
  under lease by the Company  are held by them under valid,
  subsisting and enforceable leases with such exceptions as would
  not have a Material Adverse Effect.

u. [INTENTIONALLY
  DELETED].

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

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

x. Solvency.
  The Company (after giving effect to the transactions
  contemplated by this Agreement) is solvent (i.e.,
  its assets have a fair market value in excess of the amount
  required to pay its probable liabilities on its existing debts as
  they become absolute and matured) and currently the Company has
  no information that would lead it to reasonably conclude that the
  Company would not, after giving effect to the transaction
  contemplated by this 

12

 
Agreement, have the ability to, nor does it
  intend to take any action that would impair its ability to, pay
  its debts from time to time incurred in connection therewith as
  such debts mature.  The Company did not receive a qualified
  opinion from its auditors with respect to its most recent fiscal
  year end and, after giving effect to the transactions
  contemplated by this Agreement, does not anticipate or know of
  any basis upon which its auditors might issue a qualified opinion
  in respect of its current fiscal year.

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

z. Breach of Representations and Warranties
  by the Company.
  If the Company breaches any of the representations or warranties
  set forth in this Section 3, and in addition to any other
  remedies available to the Buyer pursuant to this Agreement, it
  will be considered an Event of default under Section 3.4 of the
  Note.

4. COVENANTS.

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

b. Form D; Blue Sky Laws.
  The Company agrees to file a Form D with respect to the
  Securities as required under Regulation D and to provide a copy
  thereof to the Buyer promptly after such filing.  The Company
  shall, on or before the Closing Date, take such action as the
  Company shall reasonably determine is necessary to qualify the
  Securities for sale to the Buyer at the applicable closing
  pursuant to this Agreement under applicable securities or “blue
  sky” laws of the states of the United States (or to obtain
  an exemption from such qualification), and shall provide evidence
  of any such action so taken to the Buyer on or prior to the
  Closing Date.

c. Use of Proceeds.
  The Company shall use the proceeds for general working capital
  purposes.

d. [INTENTIONALLY
  DELETED].

e. Expenses.
  At the Closing, the Company shall reimburse Buyer for expenses
  incurred by them in connection with the negotiation, preparation,
  execution, delivery and performance of this Agreement and the
  other agreements to be executed in connection herewith
  (“Documents”),
  including, without limitation, reasonable attorneys’ and
  consultants’ fees and expenses, transfer agent fees, fees
  for stock quotation services, fees relating to any amendments or
  modifications of the Documents or any consents or waivers of
  provisions in the 

13

 
Documents, fees for the preparation of opinions
  of counsel, escrow fees, and costs of restructuring the
  transactions contemplated by the Documents.  When possible, the
  Company must pay these fees directly, otherwise the Company must
  make immediate payment for reimbursement to the Buyer for all
  fees and expenses immediately upon written notice by the Buyer or
  the submission of an invoice by the Buyer. The Company’s
  maximum
  obligation with respect to
  this transaction is to reimburse Buyer’ expenses shall be
  $3,500.

f. Financial Information.
  Upon written request the Company agrees to send or make
  available the following reports to the Buyer until the Buyer
  transfers, assigns, or sells all of the Securities:  within
  ten (10) days after the filing with the SEC, a copy of its Annual
  Report on Form 10-K its Quarterly Reports on Form 10-Q and any
  Current Reports on Form 8-K;  within one (1) day after
  release, copies of all press releases issued by the Company; and
   contemporaneously with the making available or giving to
  the shareholders of the Company, copies of any notices or other
  information the Company makes available or gives to such
  shareholders.

g. [INTENTIONALLY DELETED]

h. Listing.
  The Company shall promptly secure
  the listing of the Conversion Shares upon each national
  securities exchange or automated quotation system, if any, upon
  which shares of Common Stock are then listed (subject to official
  notice of issuance) and, so long as the Buyer owns any of the
  Securities, shall maintain, so long as any other shares of Common
  Stock shall be so listed, such listing of all Conversion Shares
  from time to time issuable upon conversion of the Note.  The
  Company will obtain and, so long as the Buyer owns any of the
  Securities, maintain the listing and trading of its Common Stock
  on the OTCBB or any equivalent replacement exchange or electronic
  quotation system (including but not limited to the Pink Sheets
  electronic quotation system) and will comply in all respects with
  the Company’s reporting, filing and other obligations under
  the bylaws or rules of the Financial Industry Regulatory
  Authority (“FINRA”) and such exchanges, as
  applicable.  The Company shall promptly provide to the Buyer
  copies of any notices it receives from the OTCBB and any other
  exchanges or electronic quotation systems on which the Common
  Stock is then traded regarding the continued eligibility of the
Common Stock for listing on such exchanges and quotation systems.

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

14

 
j. No Integration.
  The Company shall not make any offers or sales of any security
  (other than the Securities) under circumstances that would
  require registration of the Securities being offered or sold
  hereunder under the 1933 Act or cause the offering of the
  Securities to be integrated with any other offering of securities
  by the Company for the purpose of any stockholder approval
  provision applicable to the Company or its securities.

k. Breach of Covenants.
  If the Company breaches any of the covenants set forth in this
  Section 4, and in addition to any other remedies available to the
  Buyer pursuant to this Agreement, it will be considered an event
  of default under Section 3.4 of the Note.

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

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

5. Transfer Agent Instructions.
  The Company shall issue irrevocable instructions to its transfer
  agent to issue certificates, registered in the name of the Buyer
  or its nominee, for the Conversion Shares in such amounts as
  specified from time to time by the Buyer to the Company upon
  conversion of the Note in accordance with the terms thereof (the
  “Irrevocable Transfer Agent Instructions”).  In
  the event that the Borrower proposes to replace its transfer
  agent, the Borrower shall provide, prior to the effective date of
  such replacement, a fully executed Irrevocable Transfer Agent
  Instructions in a form as initially delivered pursuant to the
  Purchase Agreement (including but not limited to the provision to
  irrevocably reserve shares of Common Stock in the Reserved Amount)
  signed by the successor transfer agent to Borrower and the
  Borrower. Prior to registration of the Conversion Shares under the
  1933 Act or the date on which the Conversion Shares may be sold
  pursuant to Rule 144 without any restriction as to the number of
  Securities as of a particular date that can then be immediately
  sold, all such certificates shall bear the restrictive legend
  specified in Section 2(g) of this Agreement.  The Company
  warrants that: (i) no instruction other than the Irrevocable
  Transfer Agent Instructions referred to in this Section 5, and
  stop transfer instructions to give effect to Section 2(f) hereof
  (in the case of the Conversion Shares, prior to registration of
  the Conversion Shares under the 1933 Act or the date on which the
  Conversion Shares may be sold pursuant to Rule 144 without any
  restriction as to the number of Securities as of a particular date
  that can then be immediately sold), will be given by the Company
  to its transfer agent and that the Securities shall otherwise be
  freely transferable on the books and records of the Company as and
  to the extent provided in this Agreement and the Note; (ii) it
  will not direct its transfer agent not to transfer or delay,

15

 
 impair, and/or hinder its transfer agent in transferring (or
  issuing)(electronically or in certificated form) any certificate
  for Conversion Shares to be issued to the Buyer upon conversion of
  or otherwise pursuant to the Note as and when required by the Note
  and this Agreement; and (iii) it will not fail to remove (or
  directs its transfer agent not to remove or impairs, delays,
  and/or hinders its transfer agent from removing) any restrictive
  legend (or to withdraw any stop transfer instructions in respect
  thereof) on any certificate for any Conversion Shares issued to
  the Buyer upon conversion of or otherwise pursuant to the Note as
  and when required by the Note and this Agreement.  Nothing in
  this Section shall affect in any way the Buyer’s obligations
  and agreement set forth in Section 2(g) hereof to comply with all
  applicable prospectus delivery requirements, if any, upon re-sale
  of the Securities.  If the Buyer provides the Company, at the
  cost of the Buyer, with (i) an opinion of counsel in form,
  substance and scope customary for opinions in comparable
  transactions, to the effect that a public sale or transfer of such
  Securities may be made without registration under the 1933 Act and
  such sale or transfer is effected or (ii) the Buyer provides
  reasonable assurances that the Securities can be sold pursuant to
  Rule 144, the Company shall permit the transfer, and, in the case
  of the Conversion Shares, promptly instruct its transfer agent to
  issue one or more certificates, free from restrictive legend, in
  such name and in such denominations as specified by the Buyer. 
  The Company acknowledges that a breach by it of its obligations
  hereunder will cause irreparable harm to the Buyer, by vitiating
  the intent and purpose of the transactions contemplated hereby. 
  Accordingly, the Company acknowledges that the remedy at law for a
  breach of its obligations under this Section 5 may be inadequate
  and agrees, in the event of a breach or threatened breach by the
  Company of the provisions of this Section, that the Buyer shall be
  entitled, in addition to all other available remedies, to an
  injunction restraining any breach and requiring immediate
  transfer, without the necessity of showing economic loss and
  without any bond or other security being required. 

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

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

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

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

16

 
 covenants, agreements and conditions
  required by this Agreement to be performed, satisfied or complied
  with by the Buyer at or prior to the Closing Date.

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

7. Conditions to The Buyer’s
  Obligation to Purchase.  The
  obligation of the Buyer hereunder to purchase the Note at the
  Closing is subject to the satisfaction, at or before the Closing
  Date of each of the following conditions, provided that these
  conditions are for the Buyer’s sole benefit and may be
  waived by the Buyer at any time in its sole discretion: 

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

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

c. The Irrevocable Transfer Agent Instructions, in form and
  substance , shall have been delivered to and acknowledged in
  writing by the Company’s Transfer Agent. 

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

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

17

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

g. The Conversion Shares shall have been authorized for quotation on
  the OTCBB and trading in the Common Stock on the OTCBB shall not
  have been suspended by the SEC or the OTCBB.

h. The Buyer shall have received an officer’s certificate
  described in Section 3(c) above, dated as of the Closing Date. 

8. Governing Law; Miscellaneous.

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

b. Counterparts.
  This Agreement may be executed in one or more counterparts, each
  of which shall be deemed an original but all of which shall
  constitute one and the same agreement and shall become effective
  when counterparts have been signed by each party and delivered to
  the other party.

18

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

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

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

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

            If to
the Company, to:

                HOMELAND RESOURCES LTD.

                9120 Double Diamond Parkway H269

                Reno, NV 89521

                Attn: THOMAS CAMPBELL, President

                facsimile: [enter fax number]

            With
a copy by fax only to (which copy shall not constitute notice):

                Northwest Law Group

19

 
                 Attn: Stephen O’Neill

                595 Howe Street, Suite 704

                Vancouver, BC  V6C 2T5

                facsimile: (604) 687-6560

                e-mail:  son@stockslaw.com

            If to the Buyer:

                  KBM
WORLDWIDE, INC.

                80
Cuttermill Road – Suite 410

                Great
Neck, NY   11021

                Attn:
Seth Kramer, Presiden

                e-mail: info@kwbmlaw.com

            With
a copy by fax only to (which copy shall not constitute notice):

                Naidich
Wurman Birnbaum & Maday LLP

                Att: Judah A. Eisner,
Esq

                Attn: Bernard S. Feldman,
Esq.

                facsimile: 516-466-3555

                e-mail: dyork@nwbmlaw.com

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

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

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

 i. Survival.
  The representations and warranties of the Company and the
  agreements and covenants set forth in this Agreement shall
  survive the closing hereunder notwithstanding any due diligence
  investigation conducted by or on behalf of the Buyer.  The
  Company agrees to indemnify and hold harmless the Buyer and all
  their officers, directors, employees and agents for loss or
  damage arising as a result of or related to any breach or alleged
  breach by the Company of any of its representations, warranties
  and covenants set forth in this Agreement or any of its covenants
  and obligations under this Agreement, including advancement of
  expenses as they are incurred.

20

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

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

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

m. Remedies.
  The Company acknowledges that a breach by it of its obligations
  hereunder will cause irreparable harm to the Buyer by vitiating
  the intent and purpose of the transaction contemplated hereby.
  Accordingly, the Company acknowledges that the remedy at law for
  a breach of its obligations under this Agreement will be
  inadequate and agrees, in the event of a breach or threatened
  breach by the Company of the provisions of this Agreement, that
  the Buyer shall be entitled, in addition to all other available
  remedies at law or in equity, and in addition to the penalties
  assessable herein, to an injunction or injunctions restraining,
  preventing or curing any breach of this Agreement and to enforce
  specifically the terms and provisions hereof, without the
  necessity of showing economic loss and without any bond or other
  security being required.

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

  HOMELAND RESOURCES LTD.

By:    /s/ Thomas
Campbell

         _______________________________

         THOMAS CAMPBELL

         President

21

 

  KBM WORLDWIDE, INC.

By:  /s/ Seth
Kramer

         ________________________________

          Name: Seth Kramer

         Title:   President

         80 Cuttermill Road – Suite 410

         Great Neck, NY  11021

AGGREGATE SUBSCRIPTION AMOUNT:

Aggregate Principal Amount of Note:                                                      $88,500.00

Aggregate Purchase Price:                                                                         $88,500.00

Tranche #1       K- 1296 (HMLA)

September 8, 201
ryan@circadian-group.com
tcampbellhomeland@icloud.com
ginocardinal@yahoo.ca

22Filed by Avantafile.com - Homeland Resources Ltd. - Exhibit 10.2

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

	Principal
Amount: $88,500.00 	Issue Date: September 8, 2014
	Purchase
Price: $88,500.00	 

CONVERTIBLE PROMISSORY
NOTE

FOR
VALUE RECEIVED, HOMELAND RESOURCES LTD., a Nevada
corporation (hereinafter called the “Borrower”), hereby
promises to pay to the order of KBM WORLDWIDE, INC., a New
York corporation, or registered assigns (the “Holder”)
the sum of $88,500.00 together with any interest as set forth herein,
on June 12, 2015 (the “Maturity Date”), and to pay
interest on the unpaid principal balance hereof at the rate of eight
percent (8%) (the “Interest Rate”) per annum from the
date hereof (the “Issue Date”) until the same becomes due
and payable, whether at maturity or upon acceleration or by
prepayment or otherwise.  This Note may not be prepaid in whole or in
part except as otherwise explicitly set forth herein. Any amount of
principal or interest on this Note which is not paid when due shall
bear interest at the rate of twenty two percent (22%) per annum from
the due date thereof until the same is paid (“Default
Interest”).  Interest shall commence
accruing on the date that the Note is fully paid and shall be
computed on the basis of a 365-day year and the actual number of days
elapsed.  All payments due hereunder (to the extent not converted
into common stock, $0.0001 par value per share (the “Common
Stock”) in accordance with the terms hereof) shall be made in
lawful money of the United States of America.  All payments shall be
made at such address as the Holder shall hereafter give to the
Borrower by written notice made in accordance with the provisions of
this Note.  Whenever any amount expressed to be due by the terms of
this Note is due on any day which is not a business day, the same
shall instead be due on the next succeeding day which is a business
day and, in the case of any interest payment date which is not the
date on which this Note is paid in full, the extension of the due
date thereof shall not be taken into account for purposes of
determining the amount of interest due on such date.  As used in this

Note, the term “business day” shall mean any day other
  than a Saturday, Sunday or a day on which commercial banks in the
  city of New York, New York are authorized or required by law or
  executive order to remain closed.  Each capitalized term used herein,
  and not otherwise defined, shall have the meaning ascribed thereto in
  that certain Securities Purchase Agreement dated the date hereof,
  pursuant to which this Note was originally issued (the “Purchase
  Agreement”).

       This
Note is free from all taxes, liens, claims and encumbrances with
respect to the issue thereof and shall not be subject to preemptive
rights or other similar rights of shareholders of the Borrower and
will not impose personal liability upon the holder thereof.

       The
following terms shall apply to this Note:

  ARTICLE I. CONVERSION RIGHTS

	 	                             1.1  Conversion     Right.  The Holder shall have the right from time to time, and     at any time during the period beginning on the date which is one     hundred eighty (180) days following the date of this Note and     ending on the later of: (i) the Maturity Date and (ii) the date of     payment of the Default Amount (as defined in Article III) pursuant     to Section 1.6(a) or Article III, each in respect of the remaining     outstanding principal amount of this Note to convert all or any     part of the outstanding and unpaid principal amount of this Note     into fully paid and non- assessable shares of Common Stock, as such     Common Stock exists on the Issue Date, or any shares of capital     stock or other securities of the Borrower into which such Common     Stock shall hereafter be changed or reclassified at the conversion     price  (the “Conversion Price”) determined as provided     herein (a “Conversion”); provided, however,     that in no event shall the Holder be entitled to convert any     portion of this Note in excess of that portion of this Note upon     conversion of which the sum of (1) the number of shares of Common     Stock beneficially owned by the Holder and its affiliates (other     than shares of Common Stock which may be deemed beneficially owned     through the ownership of the unconverted portion of the Notes or     the unexercised or unconverted portion of any other security of the     Borrower subject to a limitation on conversion or exercise     analogous to the limitations contained herein) and (2) the number     of shares of Common Stock issuable upon the conversion of the     portion of this Note with respect to which the determination of     this proviso is being made, would result in beneficial ownership by     the Holder and its affiliates of more than 4.99% of the outstanding     shares of Common Stock.  For purposes of the proviso to the     immediately preceding sentence, beneficial ownership shall be     determined in accordance with Section 13(d) of the Securities     Exchange Act of 1934, as amended (the “Exchange Act”),     and Regulations 13D-G thereunder, except as otherwise provided in     clause (1) of such proviso, provided, further,   however, that the limitations on conversion may be waived by     the Holder upon, at the election of the Holder, not less than 61     days’ prior notice to the Borrower, and the provisions of the     conversion limitation shall continue to apply 

2

 
	 	until such 61st day     (or such later date, as determined by the Holder, as may be     specified in such notice of waiver).  The number of shares of     Common Stock to be issued upon each conversion of this Note shall     be determined by dividing the Conversion Amount (as defined below)     by the applicable Conversion Price then in effect on the date     specified in the notice of conversion, in the form attached hereto     as Exhibit A (the “Notice of Conversion”), delivered to     the Borrower by the Holder in accordance with Section 1.4 below;     provided that the Notice of Conversion is submitted by facsimile or     e-mail (or by other means resulting in, or reasonably expected to     result in, notice) to the Borrower before 6:00 p.m., New York, New     York time on such conversion date (the “Conversion Date”).     The term “Conversion Amount” means, with respect to     any conversion of this Note, the sum of (1) the principal amount of     this Note to be converted in such conversion plus (2) at the     Holder’s option, accrued and unpaid interest, if any, on such     principal amount at the interest rates provided in this Note to the     Conversion Date, plus (3) at the Holder’s option,     Default Interest, if any, on the amounts referred to in the     immediately preceding clauses (1) and/or (2) plus (4) at the     Holder’s option, any amounts owed to the Holder pursuant to     Sections 1.3 and 1.4(g) hereof. 

	 	            1.2 Conversion     Price.

	 	            (a) Calculation     of Conversion Price.  The conversion     price (the “Conversion Price”) shall equal the     Variable Conversion Price (as defined herein) (subject to     equitable adjustments for stock splits, stock dividends or rights     offerings by the Borrower relating to the Borrower’s     securities or the securities of any subsidiary of the Borrower,     combinations, recapitalization, reclassifications, extraordinary     distributions and similar events).  The "Variable     Conversion Price" shall mean 61% multiplied by the Market     Price (as defined herein) (representing a discount rate of 39%).    “Market Price” means the average of the lowest five     (5) Trading Prices (as defined below) for the Common Stock during     the ten (10) Trading Day period ending on the latest complete     Trading Day prior to the Conversion Date.  “Trading Price”   means, for any security as of any date, the closing bid price on   the Over-the-Counter Bulletin Board, Pink Sheets electronic   quotation system or applicable trading market (the “OTC”)     as reported by a reliable reporting service (“Reporting     Service”) designated by the Holder (i.e. Bloomberg) or, if     the OTC is not the principal trading market for such security, the     closing bid price of such security on the principal securities     exchange or trading market where such security is listed or traded     or, if no closing bid price of such security is available in any     of the foregoing manners, the average of the closing bid prices of     any market makers for such security that are listed in the “pink     sheets”.  If the Trading Price cannot be calculated for such     security on such date in the manner provided above, the Trading     Price shall be the fair market value as mutually determined by the     Borrower and the holders of a majority in

3

 
	 	 interest of the Notes     being converted for which the calculation of the Trading Price is     required in order to determine the Conversion Price of such Notes.   “Trading Day” shall mean any day on which the Common     Stock is tradable for any period on the OTC, or on the principal     securities exchange or other securities market on which the Common     Stock is then being traded. 

	 	            (b) Conversion     Price During Major Announcements.  Notwithstanding anything     contained in Section 1.2(a) to the contrary, in the event the     Borrower (i) makes a public announcement that it intends to     consolidate or merge with any other corporation (other than a     merger in which the Borrower is the surviving or continuing     corporation and its capital stock is unchanged) or sell or     transfer all or substantially all of the assets of the Borrower or     (ii) any person, group or entity (including the Borrower) publicly     announces a tender offer to purchase 50% or more of the Borrower’s     Common Stock (or any other takeover scheme) (the date of the     announcement referred to in clause (i) or (ii) is hereinafter     referred to as the  “Announcement Date”), then the     Conversion Price shall, effective upon the Announcement Date and     continuing through the Adjusted Conversion Price Termination Date     (as defined below), be equal to the lower of (x) the Conversion     Price which would have been applicable for a Conversion occurring     on the Announcement Date and (y) the Conversion Price that would     otherwise be in effect. From and after the Adjusted Conversion     Price Termination Date, the Conversion Price shall be determined     as set forth in this Section 1.2(a).  For purposes hereof,    “Adjusted Conversion Price Termination Date” shall     mean, with respect to any proposed transaction or tender offer (or     takeover scheme) for which a public announcement as contemplated     by this Section 1.2(b) has been made, the date upon which the     Borrower (in the case of clause (i) above) or the person, group or     entity (in the case of clause (ii) above) consummates or publicly     announces the termination or abandonment of the proposed     transaction or tender offer (or takeover scheme) which caused this     Section 1.2(b) to become operative. 

	 	            1.3  Authorized     Shares.  The Borrower covenants that during the period the     conversion right exists, the Borrower will reserve from its     authorized and unissued Common Stock a sufficient number of shares,     free from preemptive rights, to provide for the issuance of Common     Stock upon the full conversion of this Note issued pursuant to the     Purchase Agreement.  The Borrower is required at all times to have     authorized and reserved five times the number of shares that is     actually issuable upon full conversion of the Note (based on the     Conversion Price of the Notes in effect from time to time)(the   “Reserved Amount”).  The Reserved Amount shall be     increased from time to time in accordance with the Borrower’s     obligations hereunder.  The Borrower represents that upon issuance,     such shares will be duly and validly issued, fully paid and     non-assessable.  In addition, if the Borrower shall issue any     securities or make any change to its capital structure which would     change the number 

4

 
	 	of shares of Common Stock into which the Notes     shall be convertible at the then current Conversion Price, the     Borrower shall at the same time make proper provision so that     thereafter there shall be a sufficient number of shares of Common     Stock authorized and reserved, free from preemptive rights, for     conversion of the outstanding Notes.  The Borrower (i) acknowledges     that it has irrevocably instructed its transfer agent to issue     certificates for the Common Stock issuable upon conversion of this     Note, and (ii) agrees that its issuance of this Note shall     constitute full authority to its officers and agents who are     charged with the duty of executing stock certificates to execute     and issue the necessary certificates for shares of Common Stock in     accordance with the terms and conditions of this Note. 

            If,
at any time the Borrower does not maintain the Reserved Amount it
will be considered an Event of Default under Section 3.2 of the Note.

	 	            1.4 Method of     Conversion.

	 	            (a) Mechanics     of Conversion.  Subject to Section 1.1, this Note may be     converted by the Holder in whole or in part at any time from time     to time after the Issue Date, by (A) submitting to the     Borrower a Notice of Conversion (by facsimile, e-mail or other     reasonable means of communication dispatched on the Conversion     Date prior to 6:00 p.m., New York, New York time) and (B) subject     to Section 1.4(b), surrendering this Note at the principal office     of the Borrower. 

	 	            (b) Surrender     of Note Upon Conversion.  Notwithstanding anything to the     contrary set forth herein, upon conversion of this Note in     accordance with the terms hereof, the Holder shall not be required     to physically surrender this Note to the Borrower unless the     entire unpaid principal amount of this Note is so converted.  The     Holder and the Borrower shall maintain records showing the     principal amount so converted and the dates of such conversions or     shall use such other method, reasonably satisfactory to the Holder     and the Borrower, so as not to require physical surrender of this     Note upon each such conversion.  In the event of any dispute or     discrepancy, such records of the Borrower shall, prima   facie, be controlling and determinative in the absence of     manifest error.  Notwithstanding the foregoing, if any portion of     this Note is converted as aforesaid, the Holder may not transfer     this Note unless the Holder first physically surrenders this Note     to the Borrower, whereupon the Borrower will forthwith issue and     deliver upon the order of the Holder a new Note of like tenor,     registered as the Holder (upon payment by the Holder of any     applicable transfer taxes) may request, representing in the     aggregate the remaining unpaid principal amount of this Note.  The     Holder and any assignee, by acceptance of this Note, acknowledge     and agree that, by reason of the provisions of this 

5

 
	 	paragraph,   following conversion of a portion of this Note, the unpaid and   unconverted principal amount of this Note represented by this Note   may be less than the amount stated on the face hereof. 

	 	            (c) Payment of   Taxes.  The Borrower shall not be required to pay any tax   which may be payable in respect of any transfer involved in the   issue and delivery of shares of Common Stock or other securities   or property on conversion of this Note in a name other than that   of the Holder (or in street name), and the Borrower shall not be   required to issue or deliver any such shares or other securities   or property unless and until the person or persons (other than the   Holder or the custodian in whose street name such shares are to be   held for the Holder’s account) requesting the issuance   thereof shall have paid to the Borrower the amount of any such tax   or shall have established to the satisfaction of the Borrower that   such tax has been paid. 

	 	            (d) Delivery     of Common Stock Upon Conversion.  Upon     receipt by the Borrower from the Holder of a facsimile     transmission or e-mail (or other reasonable means of     communication) of a Notice of Conversion meeting the requirements     for conversion as provided in this Section 1.4, the Borrower shall     issue and deliver or cause to be issued and delivered to or upon     the order of the Holder certificates for the Common Stock issuable     upon such conversion within three (3) business days after such     receipt (the “Deadline”) (and, solely in the case of     conversion of the entire unpaid principal amount hereof, surrender     of this Note) in accordance with the terms hereof and the Purchase     Agreement. 

	 	            (e) Obligation   of Borrower to Deliver Common Stock.  Upon receipt by the   Borrower of a Notice of Conversion, the Holder shall be deemed to   be the holder of record of the Common Stock issuable upon such   conversion, the outstanding principal amount and the amount of   accrued and unpaid interest on this Note shall be reduced to   reflect such conversion, and, unless the Borrower defaults on its   obligations under this Article I, all rights with respect to the   portion of this Note being so converted shall forthwith terminate   except the right to receive the Common Stock or other securities,   cash or other assets, as herein provided, on such conversion.  If   the Holder shall have given a Notice of Conversion as provided   herein, the Borrower’s obligation to issue and deliver the   certificates for Common Stock shall be absolute and unconditional,   irrespective of the absence of any action by the Holder to enforce   the same, any waiver or consent with respect to any provision   thereof, the recovery of any judgment against any person or any   action to enforce the same, any failure or delay in the   enforcement of any other obligation of the Borrower to the holder   of record, or any setoff, counterclaim, recoupment, limitation or   termination, or any 

6

 
	 	breach or alleged breach by the Holder of any   obligation to the Borrower, and irrespective of any other   circumstance which might otherwise limit such obligation of the   Borrower to the Holder in connection with such conversion.  The   Conversion Date specified in the Notice of Conversion shall be the   Conversion Date so long as the Notice of Conversion is received by   the Borrower before 6:00 p.m., New York, New York time, on such   date. 

	 	            (f) Delivery     of Common Stock by Electronic Transfer.  In lieu of delivering     physical certificates representing the Common Stock issuable upon     conversion, provided the Borrower is participating in the     Depository Trust Company (“DTC”) Fast Automated     Securities Transfer (“FAST”) program, upon request of     the Holder and its compliance with the provisions contained in     Section 1.1 and in this Section 1.4, the Borrower shall use its     best efforts to cause its transfer agent to electronically     transmit the Common Stock issuable upon conversion to the Holder     by crediting the account of Holder’s Prime Broker with DTC     through its Deposit Withdrawal Agent Commission (“DWAC”)     system. 

	 	            (g) Failure to   Deliver Common Stock Prior to Deadline.  Without   in any way limiting the Holder’s right to pursue other   remedies, including actual damages and/or equitable relief, the   parties agree that if delivery of the Common Stock issuable upon   conversion of this Note is not delivered by the Deadline (other   than a failure due to the circumstances described in Section 1.3   above, which failure shall be governed by such Section) the   Borrower shall pay to the Holder $2,000 per day in cash, for each   day beyond the Deadline that the Borrower fails to deliver such   Common Stock through willful or   deliberate hindrances on the part of the Borrower.  Such cash   amount shall be paid to Holder by the fifth day of the month   following the month in which it has accrued or, at the option of   the Holder (by written notice to the Borrower by the first day of   the month following the month in which it has accrued), shall be   added to the principal amount of this Note, in which event   interest shall accrue thereon in accordance with the terms of this   Note and such additional principal amount shall be convertible   into Common Stock in accordance with the terms of this Note.  The   Borrower agrees that the right to convert is a valuable right to   the Holder.  The damages resulting from a failure, attempt to   frustrate, interference with such conversion right are difficult   if not impossible to qualify.  Accordingly the parties acknowledge   that the liquidated damages provision contained in this Section   1.4(g) are justified. 

	 	            1.5  Concerning     the Shares.  The shares of Common Stock issuable upon     conversion of this Note may not be sold or transferred unless  (i)     such shares are sold pursuant to an effective registration     statement under the Act or (ii) the Borrower or its transfer agent     shall have been furnished with an 

7

 
opinion of  counsel (which
    opinion shall be in form, substance and scope customary for
    opinions of counsel in comparable transactions) to the effect that
    the shares to be sold or transferred may be sold or transferred
    pursuant to an exemption from such registration or (iii) such
    shares are sold or transferred pursuant to Rule 144 under the Act
    (or a successor rule) (“Rule 144”) or (iv) such shares
    are transferred to an “affiliate” (as defined in Rule
    144) of the Borrower who agrees to sell or otherwise transfer the
    shares only in accordance with this Section 1.5 and who is an
    Accredited Investor (as defined in the Purchase Agreement).  Except
    as otherwise provided in the Purchase Agreement (and subject to the
    removal provisions set forth below), until such time as the shares
    of Common Stock issuable upon conversion of this Note have been
    registered under the Act or otherwise may be sold pursuant to Rule
    144 without any restriction as to the number of securities as of a
    particular date that can then be immediately sold, each certificate
    for shares of Common Stock issuable upon conversion of this Note
    that has not been so included in an effective registration
    statement or that has not been sold pursuant to an effective
    registration statement or an exemption that permits removal of the
    legend, shall bear a legend substantially in the following form, as
    appropriate: 

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

            The
legend set forth above shall be removed and the Borrower shall issue
to the Holder a new certificate therefore free of any transfer legend
if (i) the Borrower or its transfer agent shall have received an
opinion of counsel, in form, substance and scope customary for
opinions of counsel in comparable transactions, to the effect that a
public sale or transfer of such Common Stock may be made without
registration under the Act, which opinion shall be accepted by the
Company so that the sale or transfer is effected or (ii) in the case
of the Common Stock issuable upon conversion of this Note, such
security is registered for sale by the Holder under an effective
registration statement filed under the Act or otherwise may be sold
pursuant to Rule 144 without any restriction as to the number of
securities as of a particular date that can then be immediately sold.
 In the event that the Company does not accept the opinion of counsel

8

 
provided by the Holder with respect to the transfer of Securities
  pursuant to an exemption from registration, such as Rule 144 or
  Regulation S, at the Deadline, it will be considered an Event of
  Default pursuant to Section 3.2 of the Note.

	 	            1.6 Effect of     Certain Events.

	 	            (a) Effect of     Merger,  Etc.  At the option of the Holder, the sale,     conveyance or disposition of all or substantially all of the     assets of the Borrower, the effectuation by the Borrower of a     transaction or series of related transactions, other than a     private placement for cash consideration that is not a Dilutive     Issuance, in which more than 50% of the voting power of the     Borrower is disposed of, or the consolidation, merger or other     business combination of the Borrower with or into any other Person     (as defined below) or Persons when the Borrower is not the     survivor shall either:  (i) be deemed to be an Event of Default     (as defined in Article III) pursuant to which the Borrower shall     be required to pay to the Holder upon the consummation of and as a     condition to such transaction an amount equal to the Default     Amount (as defined in Article III) or (ii) be treated pursuant to     Section 1.6(b) hereof.  “Person” shall mean any     individual, corporation, limited liability company, partnership,     association, trust or other entity or organization. 

	 	            (b) Adjustment     Due to Merger,  Etc.  If, at any time when this Note is issued     and outstanding and prior to conversion of all of the Notes, there     shall be any merger,  exchange of shares, recapitalization,     reorganization, or other similar event, as a result of which     shares of Common Stock of the Borrower shall be changed into the     same or a different number of shares of another class or classes     of stock or securities of the Borrower or another entity, or in     case of any sale or conveyance of all or substantially all of the     assets of the Borrower other than in connection with a plan of     complete liquidation of the Borrower, then the Holder of this Note     shall thereafter have the right to receive upon conversion of this     Note, upon the basis and upon the terms and conditions specified     herein and in lieu of the shares of Common Stock immediately     theretofore issuable upon conversion, such stock, securities or     assets which the Holder would have been entitled to receive in     such transaction had this Note been converted in full immediately     prior to such transaction (without regard to any limitations on     conversion set forth herein), and in any such case appropriate     provisions shall be made with respect to the rights and interests     of the Holder of this Note to the end that the provisions hereof     (including, without limitation, provisions for adjustment of the     Conversion Price and of the number of shares issuable upon     conversion of the Note) shall thereafter be applicable, as nearly     as may be practicable in relation to any securities or assets     thereafter deliverable upon the conversion hereof.  The Borrower     shall not affect any 

9

 
	 	transaction described in this Section 1.6(b)   unless (a) it first gives, to the extent practicable, thirty (30)   days prior written notice (but in any event at least fifteen (15)   days prior written notice) of the record date of the special   meeting of shareholders to approve, or if there is no such record   date, the consummation of, such merger,  exchange of shares,   recapitalization, reorganization or other similar event or sale of   assets (during which time the Holder shall be entitled to convert   this Note) and (b) the resulting successor or acquiring entity (if   not the Borrower) assumes by written instrument the obligations of   this Section 1.6(b).  The above provisions shall similarly apply   to successive mergers, sales, transfers or share exchanges. 

	 	            (c) Adjustment     Due to Distribution.  If the Borrower shall declare or make     any distribution of its assets (or rights to acquire its assets)     to holders of Common Stock as a dividend, stock repurchase, by way     of return of capital or otherwise (including any dividend or     distribution to the Borrower’s shareholders in cash or     shares (or rights to acquire shares) of capital stock of a     subsidiary (i.e., a spin-off)) (a “Distribution”),     then the Holder of this Note shall be entitled, upon any     conversion of this Note after the date of record for determining     shareholders entitled to such Distribution, to receive the amount     of such assets which would have been payable to the Holder with     respect to the shares of Common Stock issuable upon such     conversion had such Holder been the holder of such shares of     Common Stock on the record date for the determination of     shareholders entitled to such Distribution. 

	 	            (d) Adjustment     Due to Dilutive Issuance.  If, at any time when any Notes are     issued and outstanding, the Borrower issues or sells, or in     accordance with this Section 1.6(d) hereof is deemed to have     issued or sold, any shares of Common Stock for no consideration or     for a consideration per share (before deduction of reasonable     expenses or commissions or underwriting discounts or allowances in     connection therewith) less than the Conversion Price in effect on     the date of such issuance (or deemed issuance) of such shares of     Common Stock (a “Dilutive Issuance”), then immediately     upon the Dilutive Issuance, the Conversion Price will be reduced     to the amount of the consideration per share received by the     Borrower in such Dilutive Issuance. 

                      The
Borrower shall be deemed to have issued or sold shares of Common
Stock if the Borrower in any manner issues or grants any warrants,
rights or options (not including employee stock option plans),
whether or not immediately exercisable, to subscribe for or to
purchase Common Stock or other securities convertible into or
exchangeable for Common Stock (“Convertible Securities”)
(such warrants, rights and options to purchase Common Stock or
Convertible Securities are hereinafter referred to as “Options”)
and the price per share for which Common Stock is issuable upon the
exercise of such Options is less than the Conversion

10

 
 Price then in
  effect, then the Conversion Price shall be equal to such price per
  share.  For purposes of the preceding sentence, the “price per
  share for which Common Stock is issuable upon the exercise of such
  Options” is determined by dividing (i) the total amount, if
  any, received or receivable by the Borrower as consideration for the
  issuance or granting of all such Options, plus the minimum aggregate
  amount of additional consideration, if any, payable to the Borrower
  upon the exercise of all such Options, plus, in the case of
  Convertible Securities issuable upon the exercise of such Options,
  the minimum aggregate amount of additional consideration payable upon
  the conversion or exchange thereof at the time such Convertible
  Securities first become convertible or exchangeable, by (ii) the
  maximum total number of shares of Common Stock issuable upon the
  exercise of all such Options (assuming full conversion of Convertible
  Securities, if applicable).  No further adjustment to the Conversion
  Price will be made upon the actual issuance of such Common Stock upon
  the exercise of such Options or upon the conversion or exchange of
  Convertible Securities issuable upon exercise of such Options.

                      Additionally,
the Borrower shall be deemed to have issued or sold shares of Common
Stock if the Borrower in any manner issues or sells any Convertible
Securities, whether or not immediately convertible (other than where
the same are issuable upon the exercise of Options), and the price
per share for which Common Stock is issuable upon such conversion or
exchange is less than the Conversion Price then in effect, then the
Conversion Price shall be equal to such price per share.  For the
purposes of the preceding sentence, the “price per share for
which Common Stock is issuable upon such conversion or exchange”
is determined by dividing (i) the total amount, if any, received or
receivable by the Borrower as consideration for the issuance or sale
of all such Convertible Securities, plus the minimum aggregate amount
of additional consideration, if any, payable to the Borrower upon the
conversion or exchange thereof at the time such Convertible
Securities first become convertible or exchangeable, by (ii) the
maximum total number of shares of Common Stock issuable upon the
conversion or exchange of all such Convertible Securities.  No
further adjustment to the Conversion Price will be made upon the
actual issuance of such Common Stock upon conversion or exchange of
such Convertible Securities.

	 	            (e) Purchase     Rights.  If, at any time when any Notes are issued and     outstanding, the Borrower issues any convertible securities or     rights to purchase stock, warrants, securities or other property     (the “Purchase Rights”) pro rata to the record holders     of any class of Common Stock, then the Holder of this Note will be     entitled to acquire, upon the terms applicable to such Purchase     Rights, the aggregate Purchase Rights which such Holder could have     acquired if such Holder had held the number of shares of Common     Stock acquirable upon complete conversion of this Note (without     regard to any limitations on conversion contained herein)     immediately before the date on which a record is taken for the     grant, issuance or sale of such Purchase Rights or, if no such     record is taken, the date as of which the record holders of Common     Stock are to be determined for the grant, issue or sale of such     Purchase Rights. 

11

 
	 	            (f) Notice of     Adjustments.  Upon the occurrence of each adjustment or     readjustment of the Conversion Price as a result of the events     described in this Section 1.6, the Borrower, at its expense, shall     promptly compute such adjustment or readjustment and prepare and     furnish to the Holder a certificate setting forth such adjustment     or readjustment and showing in detail the facts upon which such     adjustment or readjustment is based.  The Borrower shall, upon the     written request at any time of the Holder, furnish to such Holder     a like certificate setting forth (i) such adjustment or     readjustment, (ii) the Conversion Price at the time in effect and     (iii) 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 conversion of the Note. 

	 	            1.7 Trading     Market Limitations.  Unless permitted by     the applicable rules and regulations of the principal securities     market on which the Common Stock is then listed or traded, in no     event shall the Borrower issue upon conversion of or otherwise     pursuant to this Note and the other Notes issued pursuant to the     Purchase Agreement more than the maximum number of shares of Common     Stock that the Borrower can issue pursuant to any rule of the     principal United States securities market on which the Common Stock     is then traded (the “Maximum Share Amount”), which     shall be 4.99% of the total shares outstanding on the Closing Date     (as defined in the Purchase Agreement), subject to equitable     adjustment from time to time for stock splits, stock dividends,     combinations, capital reorganizations and similar events relating     to the Common Stock occurring after the date hereof.  Once the     Maximum Share Amount has been issued, if the Borrower fails to     eliminate any prohibitions under applicable law or the rules or     regulations of any stock exchange, interdealer quotation system or     other self-regulatory organization with jurisdiction over the     Borrower or any of its securities on the Borrower’s ability     to issue shares of Common Stock in excess of the Maximum Share     Amount, in lieu of any further right to convert this Note, this     will be considered an Event of Default under Section 3.3 of the     Note. 

	 	            1.8 Status as     Shareholder.  Upon submission of a Notice of Conversion by a     Holder, (i) the shares covered thereby (other than the shares, if     any, which cannot be issued because their issuance would exceed     such Holder’s allocated portion of the Reserved Amount or     Maximum Share Amount) shall be deemed converted into shares of     Common Stock and (ii) the Holder’s rights as a Holder of such     converted portion of this Note shall cease and terminate, excepting     only the right to receive certificates for such shares of Common     Stock and to any remedies provided herein or otherwise available at     law or in equity to such Holder because of a failure by the     Borrower to comply with the terms  of this Note.  Notwithstanding     the foregoing, if a Holder has not received certificates for all     shares of Common Stock prior to the tenth (10th) business day after     the expiration of the Deadline with respect to a conversion of any    

12

 
	 	portion of this Note for any reason, then (unless the Holder     otherwise elects to retain its status as a holder of Common Stock     by so notifying the Borrower) the Holder shall regain the rights of     a Holder of this Note with respect to such unconverted portions of     this Note and the Borrower shall, as soon as practicable, return     such unconverted Note to the Holder or, if the Note has not been     surrendered, adjust its records to reflect that such portion of     this Note has not been converted.  In all cases, the Holder shall     retain all of its rights and remedies (including, without     limitation, (i) the right to receive Conversion Default Payments     pursuant to Section 1.3 to the extent required thereby for such     Conversion Default and any subsequent Conversion Default and (ii)     the right to have the Conversion Price with respect to subsequent     conversions determined in accordance with Section 1.3) for the     Borrower’s failure to convert this Note. 

	 	            1.9 Prepayment.     Notwithstanding anything to the contrary contained in this Note,     at any time during the period beginning on the Issue Date and     ending on the date which is thirty (30) days following the Issue     Date, the Borrower shall have the right, exercisable on not less     than three (3) Trading Days prior written notice to the Holder of     the Note to prepay the outstanding Note (principal and accrued     interest), in full, in accordance with this Section 1.9.  Any     notice of prepayment hereunder (an “Optional Prepayment     Notice”) shall be delivered to the Holder of the Note at its     registered addresses and shall state: (1) that the Borrower is     exercising its right to prepay the Note, and (2) the date of     prepayment which shall be not more than three (3) Trading Days from     the date of the Optional Prepayment Notice.  On the date fixed for     prepayment (the “Optional Prepayment Date”), the     Borrower shall make payment of the Optional Prepayment Amount (as     defined below) to or upon the order of the Holder as specified by     the Holder in writing to the Borrower at least one (1) business day     prior to the Optional Prepayment Date.  If the Borrower exercises     its right to prepay the Note, the Borrower shall make payment to     the Holder of an amount in cash (the “Optional Prepayment     Amount”) equal to 115%, multiplied by the sum of: (w) the     then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount     of this Note to the Optional Prepayment Date plus (y) Default Interest, if any, on the amounts referred to in clauses     (w) and (x) plus (z) any amounts owed to the Holder     pursuant to Sections 1.3 and 1.4(g) hereof.     If the Borrower delivers an Optional Prepayment Notice and fails     to pay the Optional Prepayment Amount due to the Holder of the Note     within two (2) business days following the Optional Prepayment     Date, the Borrower shall forever forfeit its right to prepay the     Note pursuant to this Section 1.9. 

                      Notwithstanding
anything to the contrary contained in this Note, at any time during
the period beginning  on the date which is thirty-one (31) days
following the Issue Date and ending on the date which is sixty (60)
days following the Issue Date, the Borrower shall have the right,
exercisable on not less than three (3) Trading Days prior written
notice to the Holder of the Note to prepay the outstanding Note
(principal and accrued interest), in full, in accordance with this
Section 1.9.  Any Optional Prepayment Notice shall be delivered to
the Holder 

13

 
of the Note at its registered addresses and shall state:
  (1) that the Borrower is exercising its right to prepay the Note, and
  (2) the date of prepayment which shall be not more than three (3)
  Trading Days from the date of the Optional Prepayment Notice.  On the
  Optional Prepayment Date, the Borrower shall make payment of the
  Second Optional Prepayment Amount (as defined below) to or upon the
  order of the Holder as specified by the Holder in writing to the
  Borrower at least one (1) business day prior to the Optional
  Prepayment Date.  If the Borrower exercises its right to prepay the
  Note, the Borrower shall make payment to the Holder of an amount in
  cash (the “Second Optional Prepayment Amount”) equal to
  120%, multiplied by the sum of: (w) the then outstanding principal
  amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount
  of this Note to the Optional Prepayment Date plus (y) Default Interest, if any, on the amounts referred to in clauses
  (w) and (x) plus (z) any amounts owed to the Holder
  pursuant to Sections 1.3 and 1.4(g) hereof.
  If the Borrower delivers an Optional Prepayment Notice and fails to
  pay the Second Optional Prepayment Amount due to the Holder of the
  Note within two (2) business days following the Optional Prepayment
  Date, the Borrower shall forever forfeit its right to prepay the Note
  pursuant to this Section 1.9.

                      Notwithstanding
anything to the contrary contained in this Note, at any time during
the period beginning  on the date which is sixty-one (61) days
following the Issue Date and ending on the date which is ninety (90)
days following the Issue Date, the Borrower shall have the right,
exercisable on not less than three (3) Trading Days prior written
notice to the Holder of the Note to prepay the outstanding Note
(principal and accrued interest), in full, in accordance with this
Section 1.9.  Any Optional Prepayment Notice shall be delivered to
the Holder of the Note at its registered addresses and shall state:
(1) that the Borrower is exercising its right to prepay the Note, and
(2) the date of prepayment which shall be not more than three (3)
Trading Days from the date of the Optional Prepayment Notice.  On the
Optional Prepayment Date, the Borrower shall make payment of the
Third Optional Prepayment Amount (as defined below) to or upon the
order of the Holder as specified by the Holder in writing to the
Borrower at least one (1) business day prior to the Optional
Prepayment Date.  If the Borrower exercises its right to prepay the
Note, the Borrower shall make payment to the Holder of an amount in
cash (the “Third Optional Prepayment Amount”) equal to
125%, multiplied by the sum of: (w) the then outstanding principal
amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount
of this Note to the Optional Prepayment Date plus
(y) Default Interest, if any, on the amounts referred to in clauses
(w) and (x) plus
(z) any amounts owed to the Holder
pursuant to Sections 1.3 and 1.4(g) hereof.
 If the Borrower delivers an Optional Prepayment Notice and fails to
pay the Third Optional Prepayment Amount due to the Holder of the
Note within two (2) business days following the Optional Prepayment
Date, the Borrower shall forever forfeit its right to prepay the Note
pursuant to this Section 1.9.

                      Notwithstanding any to the
contrary stated elsewhere herein, at any time during the period
beginning on the date that is ninety-one (91) day from the Issue Date
and ending one

14

 
 hundred twenty (120) days following the Issue Date,
  the Borrower shall have the right, exercisable
  on not less than three (3) Trading Days prior written notice to the
  Holder of the Note to prepay the outstanding Note (principal and
  accrued interest), in full, in accordance with this Section 1.9.  Any
  Optional Prepayment Notice shall be delivered to the Holder of the
  Note at its registered addresses and shall state: (1) that the
  Borrower is exercising its right to prepay the Note, and (2) the date
  of prepayment which shall be not more than three (3) Trading Days
  from the date of the Optional Prepayment Notice.  On the Optional
  Prepayment Date, the Borrower shall make payment of the Fourth
  Optional Prepayment Amount (as defined below) to or upon the order of
  the Holder as specified by the Holder in writing to the Borrower at
  least one (1) business day prior to the Optional Prepayment Date.  If
  the Borrower exercises its right to prepay the Note, the Borrower
  shall make payment to the Holder of an amount in cash (the “Fourth
  Optional Prepayment Amount”) equal to 130%, multiplied by the
  sum of: (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount
  of this Note to the Optional Prepayment Date plus (y) Default Interest, if any, on the amounts referred to in clauses
  (w) and (x) plus (z) any amounts owed to the Holder pursuant to Sections 1.3 and
  1.4(g) hereof.  If the Borrower delivers an Optional Prepayment
  Notice and fails to pay the Fourth Optional Prepayment Amount due to
  the Holder of the Note within two (2) business days following the
  Optional Prepayment Date, the Borrower shall forever forfeit its
  right to prepay the Note pursuant to this Section 1.9.

                      Notwithstanding any to the
contrary stated elsewhere herein, at any time during the period
beginning on the date that is one hundred twenty-one (121) day from
the Issue Date and ending one hundred fifty (150) days following the
Issue Date, the Borrower shall have the right,
exercisable on not less than three (3) Trading Days prior written
notice to the Holder of the Note to prepay the outstanding Note
(principal and accrued interest), in full, in accordance with this
Section 1.9.  Any Optional Prepayment Notice shall be delivered to
the Holder of the Note at its registered addresses and shall state:
(1) that the Borrower is exercising its right to prepay the Note, and
(2) the date of prepayment which shall be not more than three (3)
Trading Days from the date of the Optional Prepayment Notice.  On the
Optional Prepayment Date, the Borrower shall make payment of the
Fifth Optional Prepayment Amount (as defined below) to or upon the
order of the Holder as specified by the Holder in writing to the
Borrower at least one (1) business day prior to the Optional
Prepayment Date.  If the Borrower exercises its right to prepay the
Note, the Borrower shall make payment to the Holder of an amount in
cash (the “Fifth Optional Prepayment Amount”) equal to
135%, multiplied by the sum of: (w) the then outstanding principal
amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount
of this Note to the Optional Prepayment Date plus
(y) Default Interest, if any, on the amounts referred to in clauses
(w) and (x) plus
(z) any amounts owed to the Holder pursuant to Sections 1.3 and
1.4(g) hereof.  If the Borrower delivers an Optional Prepayment
Notice and fails to pay the Fifth Optional Prepayment Amount due to
the Holder of the Note within two (2) business days following the
Optional Prepayment Date, the Borrower shall forever forfeit its
right to prepay the Note pursuant to this Section 1.9.

15

 
                      Notwithstanding any to the
contrary stated elsewhere herein, at any time during the period
beginning on the date that is one hundred fifty-one (151) day from
the Issue Date and ending one hundred eighty (180) days following the
Issue Date, the Borrower shall have the right,
exercisable on not less than three (3) Trading Days prior written
notice to the Holder of the Note to prepay the outstanding Note
(principal and accrued interest), in full, in accordance with this
Section 1.9.  Any Optional Prepayment Notice shall be delivered to
the Holder of the Note at its registered addresses and shall state:
(1) that the Borrower is exercising its right to prepay the Note, and
(2) the date of prepayment which shall be not more than three (3)
Trading Days from the date of the Optional Prepayment Notice.  On the
Optional Prepayment Date, the Borrower shall make payment of the
Sixth Optional Prepayment Amount (as defined below) to or upon the
order of the Holder as specified by the Holder in writing to the
Borrower at least one (1) business day prior to the Optional
Prepayment Date.  If the Borrower exercises its right to prepay the
Note, the Borrower shall make payment to the Holder of an amount in
cash (the “Sixth Optional Prepayment Amount”) equal to
140%, multiplied by the sum of: (w) the then outstanding principal
amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount
of this Note to the Optional Prepayment Date plus
(y) Default Interest, if any, on the amounts referred to in clauses
(w) and (x) plus
(z) any amounts owed to the Holder pursuant to Sections 1.3 and
1.4(g) hereof.  If the Borrower delivers an Optional Prepayment
Notice and fails to pay the Sixth Optional Prepayment Amount due to
the Holder of the Note within two (2) business days following the
Optional Prepayment Date, the Borrower shall forever forfeit its
right to prepay the Note pursuant to this Section 1.9.

                     After
the expiration of one hundred eighty (180) following the date of the
Note, the Borrower shall have no right of prepayment.

  ARTICLE II. CERTAIN COVENANTS

	 	            2.1 Distributions     on Capital Stock.  So long as the Borrower shall have any     obligation under this Note, the Borrower shall not without the     Holder’s written consent (a) pay, declare or set apart for     such payment, any dividend or other distribution (whether in cash,     property or other securities) on shares of capital stock other than     dividends on shares of Common Stock solely in the form of     additional shares of Common Stock or (b) directly or indirectly or     through any subsidiary make any other payment or distribution in     respect of its capital stock except for distributions pursuant to     any shareholders’ rights plan which is approved by a majority     of the Borrower’s disinterested directors. 

	 	            2.2 Restriction   on Stock Repurchases.  So long as the Borrower shall have any   obligation under this Note, the Borrower shall not without the   Holder’s written consent redeem, repurchase or otherwise   acquire (whether for cash or in exchange for property or other   securities or otherwise) in any one transaction or series 

16

 
	 	of   related transactions any shares of capital stock of the Borrower or   any warrants, rights or options to purchase or acquire any such   shares. 

	 	            2.3 Borrowings.   So long as the Borrower shall have any   obligation under this Note, the Borrower shall not, without the   Holder’s written consent, create, incur, assume guarantee,   endorse, contingently agree to purchase or otherwise become liable   upon the obligation of any person, firm, partnership, joint venture   or corporation, except by the endorsement of negotiable instruments   for deposit or collection, or suffer to exist any liability for   borrowed money, except (a) borrowings in existence or committed on   the date hereof and of which the Borrower has informed Holder in   writing prior to the date hereof, (b) convertible debt issued in a   private placement that is not a Dilutive Issuance (c) indebtedness   to trade creditors or financial institutions incurred in the   ordinary course of business or (d) borrowings, a portion of the   proceeds of which shall be used to repay this Note. 

	 	            2.4 Sale of   Assets.  So long as the Borrower shall have any obligation   under this Note, the Borrower shall not, without the Holder’s   written consent, sell, lease or otherwise dispose of all or   substantially all of its assets outside the ordinary course of   business.  Any consent to the disposition of any assets may be   conditioned on a specified use of the proceeds of disposition. 

	 	            2.5 Advances   and Loans.  So long as the Borrower shall have any obligation   under this Note, the Borrower shall not, without the Holder’s   written consent, lend money, give credit or make advances to any   person, firm, joint venture or corporation, including, without   limitation, officers, directors, employees, subsidiaries and   affiliates of the Borrower, except loans, credits or advances (a)   in existence or committed on the date hereof and which the Borrower   has informed Holder in writing prior to the date hereof, (b) made   in the ordinary course of business or (c) not in excess of   $100,000. 

  ARTICLE III. EVENTS OF DEFAULT

                      If
any of the following events of default (each, an “Event of
Default”) shall occur:

	 	            3.1 Failure to     Pay Principal or Interest.  The Borrower     fails to pay the principal hereof or interest thereon when due on     this Note, whether at maturity, upon acceleration or otherwise.

	 	            3.2 Conversion   and the Shares.  The Borrower through   willful or deliberate hindrances on the part of the Borrower, fails   to issue shares of Common Stock to the Holder (or announces or   threatens in writing that it will not honor its 

17

 
	 	obligation to do   so) upon exercise by the Holder of the conversion rights of the   Holder in accordance with the terms of this Note, fails   to transfer or cause its transfer agent to transfer (issue)   (electronically or in certificated form) any certificate for shares   of Common Stock issued to the Holder upon conversion of or   otherwise pursuant to this Note as and when required by this Note,   the Borrower directs its transfer agent not to transfer or delays,   impairs, and/or hinders its transfer agent in transferring (or   issuing) (electronically or in certificated form) any certificate   for shares of Common Stock to be issued to the Holder upon   conversion of or otherwise pursuant to this Note as and when   required by this Note, or fails to remove (or directs its transfer   agent not to remove or impairs, delays, and/or hinders its transfer   agent from removing) any restrictive legend (or to withdraw any   stop transfer instructions in respect thereof) on any certificate   for any shares of Common Stock issued to the Holder upon conversion   of or otherwise pursuant to this Note as and when required by this   Note (or makes any written announcement, statement or threat that   it does not intend to honor the obligations described in this   paragraph) and any such failure shall continue uncured (or any   written announcement, statement or threat not to honor its   obligations shall not be rescinded in writing) for three (3)   business days after the Holder shall have delivered a Notice of   Conversion.  It is an obligation of the Borrower to remain current   in its obligations to its transfer agent. It shall be an event of   default of this Note, if a conversion of this Note is delayed,   hindered or frustrated due to a balance owed by the Borrower to its   transfer agent. If at the option of the Holder, the Holder advances   any funds to the Borrower’s transfer agent in order to   process a conversion, such advanced funds shall be paid by the   Borrower to the Holder within forty eight (48) hours of a demand   from the Holder. 

	 	            3.3 Breach of     Covenants.  The Borrower breaches any material covenant or     other material term or condition contained in this Note and any     collateral documents including but not limited to the Purchase     Agreement and such breach continues for a period of ten (10) days     after written notice thereof to the Borrower from the Holder. 

	 	            3.4 Breach of     Representations and Warranties.  Any representation or warranty     of the Borrower made herein or in any agreement, statement or     certificate given in writing pursuant hereto or in connection     herewith (including, without limitation, the Purchase Agreement),     shall be false or misleading in any material respect when made and     the breach of which has (or with the passage of time will have) a     material adverse effect on the rights of the Holder with respect to     this Note or the Purchase Agreement. 

	 	            3.5 Receiver or     Trustee.  The Borrower or any subsidiary of the Borrower shall     make an assignment for the benefit of creditors, or apply for 

18

 
	 	or   consent to the appointment of a receiver or trustee for it or for a   substantial part of its property or business, or such a receiver or   trustee shall otherwise be appointed. 

	 	            3.6 Judgments.     Any money judgment, writ or similar process shall be entered or     filed against the Borrower or any subsidiary of the Borrower or any     of its property or other assets for more than $50,000, and shall     remain unvacated, unbonded or unstayed for a period of twenty (20)     days unless otherwise consented to by the Holder, which consent     will not be unreasonably withheld. 

	 	            3.7 Bankruptcy.     Bankruptcy, insolvency, reorganization or liquidation proceedings     or other proceedings, voluntary or involuntary, for relief under     any bankruptcy law or any law for the relief of debtors shall be     instituted by or against the Borrower or any subsidiary of the     Borrower. 

	 	            3.8 Delisting     of Common Stock.  The Borrower shall fail to maintain the     listing of the Common Stock on at least one of the OTC (which     specifically includes the Pink Sheets electronic quotation system)     or an equivalent replacement exchange, the Nasdaq National Market,     the Nasdaq SmallCap Market, the New York Stock Exchange, or the     American Stock Exchange. 

	 	            3.9 Failure to     Comply with the Exchange Act.  The Borrower shall fail to     comply with the reporting requirements of the Exchange Act; and/or     the Borrower shall cease to be subject to the reporting     requirements of the Exchange Act. 

	 	            3.10 Liquidation.Any     dissolution, liquidation, or winding up of Borrower or any     substantial portion of its business. 

	 	            3.11 Cessation     of Operations.Any cessation of operations by Borrower or     Borrower admits it is otherwise generally unable to pay its debts     as such debts become due, provided, however, that any disclosure of     the Borrower’s ability to continue as a “going concern”   shall not be an admission that the Borrower cannot pay its debts as   they become due. 

	 	            3.12 Maintenance     of Assets.The failure by Borrower to maintain any material     intellectual property rights, personal, real property or other     assets which are necessary to conduct its business (whether now or     in the future). 

	 	            3.13 Financial     Statement Restatement.The restatement of any financial     statements filed by the Borrower with the SEC for any date or     period from two years prior to the Issue Date of this Note and     until this Note is no longer outstanding, if the result of such     restatement would, by comparison to the unrestated

19

 
	 	 financial   statement, have constituted a material adverse effect on the rights   of the Holder with respect to this Note or the Purchase Agreement. 

	 	            3.14 Reverse     Splits.The Borrower effectuates a reverse split of its Common     Stock without   written notice to the Holder on the date such news     is made public. 

                      3.15
    Replacement
of Transfer Agent. In the event that
the Borrower proposes to replace its transfer agent, the Borrower
fails to provide, prior to the effective date of such replacement, a
fully executed Irrevocable Transfer Agent Instructions in a form as
initially delivered pursuant to the Purchase Agreement (including but
not limited to the provision to irrevocably reserve shares of Common
Stock in the Reserved Amount) signed by the successor transfer agent
to Borrower and the Borrower.

                     3.16 Cross-Default. 
Notwithstanding anything to the contrary contained in this Note or
the other related or companion documents, a breach or default by the
Borrower of any covenant or other term or condition contained in any
of the Other Agreements, after the passage of all applicable notice
and cure or grace periods, shall, at the option of the Holder, be
considered a default under this Note and the Other Agreements, in
which event the Holder shall be entitled (but in no event required)
to apply all rights and remedies of the Holder under the terms of
this Note and the Other Agreements by reason of a default under said
Other Agreement or hereunder.
“Other Agreements” means, collectively, all
agreements and instruments between, among or by: (1) the Borrower,
and, or for the benefit of, (2) the Holder and any affiliate of
the Holder, including, without limitation, promissory notes;
provided, however, the term “Other Agreements” shall not
include the related or companion documents to this Note.  Each of the
loan transactions will be cross-defaulted with each other loan
transaction and with all other existing and future debt of Borrower
to the Holder.

            Upon
the occurrence and during the continuation of any Event of Default
specified in Section 3.1 (solely with respect to failure to pay the
principal hereof or interest thereon when due at the Maturity Date),
the Note shall become immediately due and payable and the Borrower
shall pay to the Holder, in full satisfaction of its obligations
hereunder, an amount equal to the Default Sum (as defined herein). 
UPON THE OCCURRENCE AND DURING THE CONTINUATION OF ANY EVENT OF
DEFAULT SPECIFIED IN SECTION 3.2, THE NOTE SHALL BECOME IMMEDIATELY
DUE AND PAYABLE AND THE BORROWER SHALL PAY TO THE HOLDER, IN FULL
SATISFACTION OF ITS OBLIGATIONS HEREUNDER, AN AMOUNT EQUAL TO: (Y)
THE DEFAULT SUM (AS DEFINED HEREIN); MULTIPLIED BY (Z) TWO (2). Upon
the occurrence and during the continuation of any Event of Default
specified in Sections 3.1 (solely with respect to failure to pay the
principal hereof or interest thereon when due on this Note upon a
Trading Market Prepayment Event pursuant to 

20

 
Section 1.7 or upon
  acceleration), 3.3, 3.4, 3.6, 3.8, 3.9, 3.11, 3.12, 3.13, 3.14,
  and/or 3. 15 exercisable through the delivery of written notice to
  the Borrower by such Holders (the “Default Notice”), and
  upon the occurrence of an Event of Default specified the remaining
  sections of Articles III (other than failure to pay the principal
  hereof or interest thereon at the Maturity Date specified in Section
  3,1 hereof), the Note shall become immediately due and payable and
  the Borrower shall pay to the Holder, in full satisfaction of its
  obligations hereunder, an amount equal to the greater of (i) 150% times the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount of
  this Note to the date of payment (the “Mandatory Prepayment
  Date”) plus (y) Default Interest, if any, on the amounts referred to in clauses
  (w) and/or (x) plus (z) any amounts owed to the Holder pursuant to Sections 1.3 and
  1.4(g) hereof (the then outstanding principal amount of this Note to
  the date of payment plus the amounts referred to in clauses (x), (y) and (z) shall
  collectively be known as the “Default Sum”) or (ii) the
  “parity value” of the Default Sum to be prepaid, where
  parity value means (a) the highest number of shares of Common Stock
  issuable upon conversion of or otherwise pursuant to such Default Sum
  in accordance with Article I, treating the Trading Day immediately
  preceding the Mandatory Prepayment Date as the “Conversion
  Date” for purposes of determining the lowest applicable
  Conversion Price, unless the Default Event arises as a result of a
  breach in respect of a specific Conversion Date in which case such
  Conversion Date shall be the Conversion Date), multiplied
    by (b) the highest Closing Price for
  the Common Stock during the period beginning on the date of first
  occurrence of the Event of Default and ending one day prior to the
  Mandatory Prepayment Date (the “Default Amount”) and all
  other amounts payable hereunder shall immediately become due and
  payable, all without demand, presentment or notice, all of which
  hereby are expressly waived, together with all costs, including,
  without limitation, legal fees and expenses, of collection, and the
  Holder shall be entitled to exercise all other rights and remedies
  available at law or in equity. 

            If
the Borrower fails to pay the Default Amount within five (5) business
days of written notice that such amount is due and payable, then the
Holder shall have the right at any time, so long as the Borrower
remains in default (and so long and to the extent that there are
sufficient authorized shares), to require the Borrower, upon written
notice, to immediately issue, in lieu of the Default Amount, the
number of shares of Common Stock of the Borrower equal to the Default
Amount divided by the Conversion Price then in effect.

  ARTICLE IV. MISCELLANEOUS

	 	            4.1 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     privileges.  All rights and remedies existing hereunder are     cumulative to, and not exclusive of, any rights or remedies     otherwise available.

21

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

If to the Borrower, to:

      HOMELAND RESOURCES LTD.

      9120 Double Diamond Parkway H269

      Reno, NV 89521

      Attn: THOMAS CAMPBELL,
President

      facsimile:

              With
a copy by fax only to (which copy shall not constitute notice):

      Northwest
Law Group

      Attn:
Stephen O’Neill

      595 Howe
Street, Suite 704

      Vancouver,
BC  V6C 2T5

      facsimile:
(604) 687-6560

      e-mail:
son@stockslaw.com

                 If
to the Holder

      KBM
WORLDWIDE, INC.

      80 Cuttermill Road –
  Suite 410

        Great Neck, NY  11021

        Attn:
Seth Kramer, President

      e-mail: info@kbmworldwide.com

22

 
              With
a copy by fax only to (which copy shall not constitute notice)

      Naidich
Wurman Birnbaum & Maday, LLP

      Att:
Judah A. Eisner, Esq.

      Attn:
Bernard S. Feldman, Esq.

      facsimile: 516-466-3555

      e-mail: dyork@nwbmlaw.com

	 	            4.3 Amendments.     This Note and any provision hereof may only be amended by an     instrument in writing signed by the Borrower and the Holder.  The     term “Note” and all reference thereto, as used     throughout this instrument, shall mean this instrument (and the     other Notes issued pursuant to the Purchase Agreement) as     originally executed, or if later amended or supplemented, then as     so amended or supplemented. 

	 	            4.4 Assignability.     This Note shall be binding upon the Borrower and its successors     and assigns, and shall inure to be the benefit of the Holder and     its successors and assigns.  Each transferee of this Note must be     an “accredited investor” (as defined in Rule 501(a) of     the 1933 Act).  Notwithstanding anything in this Note to the     contrary, this Note may be pledged as collateral in connection with     a bona fide margin account or other lending     arrangement. 

	 	            4.5 Cost of   Collection.  If default is made in the payment of this Note,   the Borrower shall pay the Holder hereof costs of collection,   including reasonable attorneys’ fees. 

	 	            4.6 Governing     Law.  This Note shall be governed by and construed in     accordance with the laws of the State of New York without regard to     principles of conflicts of laws.  Any action brought by either     party against the other concerning the transactions contemplated by     this Note shall be brought only in the state courts of New York or     in the federal courts located in the state and county of Nassau.      The parties to this Note hereby irrevocably waive any objection to     jurisdiction and venue of any action instituted hereunder and shall     not assert any defense based on lack of jurisdiction or venue or     based upon forum non conveniens.  The Borrower and Holder     waive trial by jury.  The prevailing party shall be entitled to     recover from the other party its reasonable attorney's fees and     costs.  In the event that any provision of this Note or any other     agreement delivered in connection herewith is invalid or     unenforceable under any applicable statute or rule of law, then     such provision shall be deemed inoperative to the extent that it     may conflict therewith and shall be deemed modified to conform with     such statute or rule of law.  Any such provision which may prove     invalid or unenforceable under any law shall not affect the     validity or enforceability of any other provision of any agreement.     Each party hereby irrevocably waives personal service of process     and consents to process being 

23

 
	 	served in any suit, action or   proceeding in connection with this Agreement or any other   Transaction Document by mailing a copy thereof via registered or   certified mail or overnight delivery (with evidence of delivery) to   such party at the address in effect for notices to it under this   Agreement and agrees that such service shall constitute good and   sufficient service of process and notice thereof.  Nothing   contained herein shall be deemed to limit in any way any right to   serve process in any other manner permitted by law. 

	 	            4.7  Certain     Amounts.  Whenever pursuant to this Note the Borrower is     required to pay an amount in excess of the outstanding principal     amount (or the portion thereof required to be paid at that time)     plus accrued and unpaid interest plus Default Interest on such     interest, the Borrower and the Holder agree that the actual damages     to the Holder from the receipt of cash payment on this Note may be     difficult to determine and the amount to be so paid by the Borrower     represents stipulated damages and not a penalty and is intended to     compensate the Holder in part for loss of the opportunity to     convert this Note and to earn a return from the sale of shares of     Common Stock acquired upon conversion of this Note at a price in     excess of the price paid for such shares pursuant to this Note.      The Borrower and the Holder hereby agree that such amount of     stipulated damages is not plainly disproportionate to the possible     loss to the Holder from the receipt of a cash payment without the     opportunity to convert this Note into shares of Common Stock. 

	 	            4.8 Purchase     Agreement.  By its acceptance of this Note, each party agrees     to be bound by the applicable terms of the Purchase Agreement. 

	 	            4.9 Notice of   Corporate Events.  Except as otherwise provided below, the   Holder of this Note shall have no rights as a Holder of Common   Stock unless and only to the extent that it converts this Note into   Common Stock. The Borrower shall provide the Holder with prior   notification of any meeting of the Borrower’s shareholders   (and copies of proxy materials and other information sent to   shareholders).  In the event of any taking by the Borrower of a   record of its shareholders for the purpose of determining   shareholders who are entitled to receive payment of any dividend or   other distribution, any right to subscribe for, purchase or   otherwise acquire (including by way of merger, consolidation,   reclassification or recapitalization) any share of any class or any   other securities or property, or to receive any other right, or for   the purpose of determining shareholders who are entitled to vote in   connection with any proposed sale, lease or conveyance of all or   substantially all of the assets of the Borrower or any proposed   liquidation, dissolution or winding up of the Borrower, the   Borrower shall mail a notice to the Holder, at least twenty (20)   days prior to the record date specified therein (or thirty (30)   days prior to the consummation of the transaction or event,   whichever is earlier), of the date on which any such record is to   be taken for the purpose of such dividend,

24

 
	 	 distribution, right or   other event, and a brief statement regarding the amount and   character of such dividend, distribution, right or other event to   the extent known at such time.  The Borrower shall make a public   announcement of any event requiring notification to the Holder   hereunder substantially simultaneously with the notification to the   Holder in accordance with the terms of this Section 4.9. 

	 	            4.10 Remedies.     The Borrower acknowledges that a breach by it of its obligations     hereunder will cause irreparable harm to the Holder, by vitiating     the intent and purpose of the transaction contemplated hereby.      Accordingly, the Borrower acknowledges that the remedy at law for a     breach of its obligations under this Note will be inadequate and     agrees, in the event of a breach or threatened breach by the     Borrower of the provisions of this Note, that the Holder shall be     entitled, in addition to all other available remedies at law or in     equity, and in addition to the penalties assessable herein, to an     injunction or injunctions restraining, preventing or curing any     breach of this Note and to enforce specifically the terms and     provisions thereof, without the necessity of showing economic loss     and without any bond or other security being required. 

      IN
WITNESS WHEREOF, Borrower has caused this Note to be signed in its
name by its duly authorized officer this September 8, 2014.

HOMELAND RESOURCES LTD.

By:
        /s/ Thomas Campbell

              _______________________________

          THOMAS CAMPBELL

         President

25

 

  EXHIBIT
A --  NOTICE OF CONVERSION  

The
undersigned hereby elects to convert $_________________
principal amount of
the Note (defined below) into that number
of shares of Common Stock to be issued pursuant to the conversion of
the Note
(“Common Stock”) as set forth below, of HOMELAND RESOURCES LTD.,
a Nevada corporation (the “Borrower”) according to the
conditions of the convertible note of the Borrower dated as of September 8, 2014
(the “Note”),
as of the date written below.  No fee will be charged to the Holder
for any conversion, except for transfer taxes, if any. 

Box
Checked as to applicable instructions:

	 	[ ] 	The Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”).

	 	Name of DTC Prime Broker:
 Account Number:

	 	[ ] 	The undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto:

	 	KBM WORLDWIDE, INC.
 80 Cuttermill Road – Suite 410
 Great Neck, NY 11021
 Attention: Certificate Delivery
 e-mail: info@kbmworldwide.com

	 	Date   of Conversion:                                                                              _____________
   Applicable   Conversion Price:                                                $____________
   Number   of Shares of Common Stock to be Issued
   Pursuant   to Conversion of the Notes:                                 ______________
   Amount   of Principal Balance Due remaining
   Under   the Note after this conversion:                                                      ______________

	 	KBM   WORLDWIDE, INC.

	 	 By:_____________________________
   Name:Seth   Kramer
   Title:   President
   Date:

26

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00235-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00235-of-00352.parquet"}]]