Document:

EX-10.1

 Exhibit 10.1 
  

 
 December 4, 2013 

William Patrick Ryan 
 17543 Rancho del Rio 

Rancho Santa Fe, CA 92067 
 Dear Patrick: 

Insulet Corporation (“Insulet” or the “Company”) is pleased to offer you the position of Chief Operating Officer, reporting directly to
Duane DeSisto, President & Chief Executive Officer. Your responsibilities are as outlined in the enclosed job description. You will be required to sign a copy of your job description as part of your onboarding with the Company. We are
excited about the prospect of you joining Insulet and look forward to your meaningful contribution to the team. This offer of employment is contingent upon the satisfactory completion of professional references and a background check prior to your
start date. We will determine a mutually beneficial start date upon acceptance of this offer. 
 Your salary will be paid at an initial annualized rate of
$375,000. You will be paid $14,423.08 biweekly in accordance with the Company’s normal payroll practices as established or modified from time to time. In addition, you will receive a one-time sign on bonus of $100,000 payable in the first pay
period after beginning your employment. This bonus is considered taxable income. Should you leave Insulet within one year of your hire date you will be responsible for repayment of this bonus on a prorata basis. You will participate in the
Company’s Executive Incentive Compensation Program with a target bonus of 60% of your annual base compensation. Executive Compensation is reviewed annually, and your next formal performance and compensation review will occur in Q1 2015 covering
the 2014 performance year. 
 You will be eligible to participate in the Company’s benefits programs to the same extent as, and subject to the same
terms, conditions and limitations applicable to, other employees of the Company of similar rank and tenure. These benefits presently include: comprehensive medical, prescription drug, and dental insurance coverage, with 80% of premiums paid for you
and your dependents; Company-paid life insurance coverage at two times your annualized salary; 401(k) plan; employee stock purchase plan; paid time off at an initial rate of 26 days per year, per Company policy. For a more detailed understanding of
the benefits and the eligibility requirements, please consult the summary plan descriptions for the programs which will be made available to you. You will also be eligible for benefits under the Insulet Corporation Executive Severance plan. 

Subject to approval of the Company’s Board of Directors, you will receive the following equity awards. 

 

	 	•	 	You will be granted the option to purchase 30,000 shares of Company common stock, at a purchase price equal to the fair market value as of the date of the grant. Stock option vest 25% after one year of
service, then 6.25% quarterly thereafter, with full vesting over 4 years of service. 

  

	 	•	 	You will be awarded 35,000 restricted stock units. RSUs vest annually at 25% per year over 4 years. 

  

	 	•	 	The date of the grant is typically the first of the month following your start date. Prior to the grant date, the number of options may be adjusted to reflect a stock split or other similar
transaction. This grant will be subject to and governed by the terms and conditions of a stock option agreement between you and the Company and the Company’s Stock Option and Incentive Plan, which will include, among other things, your
vesting schedule.

	 	•	 	You will also be eligible for additional performance shares as part of the senior executive team grant in Q1 2014. The grant amount, milestones and grant date are also subject to board approval. 

This position is salary exempt and may include travel and hours greater than a forty hour per-week work schedule. You will be reimbursed for normal business
travel and lodging expenses outside of the local Bedford, Massachusetts area. Your employment is at-will and no contract is implied by the terms of this letter. 

Your relocation expenses are estimated at $100,000 to include standard and reasonable expenses on home sale and purchase, temporary living, moving of
household goods, travel and tax assistance. Relocation benefits will be finalized under a separate attachment after we understand your specific needs, timing and situation. 

By signing this offer letter, you confirm that your employment with Insulet will not violate any of your existing obligations and that you will not disclose
any confidential information from any another employer to Insulet. You also confirm that your ability to make this statement is based upon your own research and/or assurances provided by your own counsel, and is not based on any information given to
you by Insulet or any of its agents or employees. 
 You will be required to sign the Company’s standard Proprietary Information and Non-Competition
Agreements as a condition of your employment with the Company. A copy of these agreements will be made available to you prior to your employment start date. 

Also, please bring with you, for the purpose of completing the I-9 form, sufficient documentation to demonstrate your eligibility to work in the United States
on your first day of employment. This verification must occur by the third day of your employment. 
 We look forward to having you join Insulet. We hope
you will be a very valuable contributor to our team going forward. Please provide a response within 3 business days acknowledging that you have accepted this offer of employment. 

 

					
	Sincerely,	 		 	
			
	/s/ Duane DeSisto	 		 	  

	 Duane DeSisto
 President & Chief
Executive Officer
	 		 	
			
	Accepted:	 		 	
			
	/s/ William Patrick Ryan	 		 	N.L.T. 20 JAN 2014
	William Patrick Ryan	 		 	Agreed upon Start DateNEITHER
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: $42,500.00	Issue
    Date: November 25, 2013 
	Purchase
    Price: $42,500.00	 

 

 

CONVERTIBLE
PROMISSORY NOTE

 

FOR
VALUE RECEIVED,
CO-SIGNER, INC.,
a Nevada
corporation (hereinafter
called the “Borrower”),
hereby promises
to pay
to the order
of ASHER
ENTERPRISES, INC.,
a Delaware
corporation, or
registered assigns
(the “Holder”)
the sum of
$42,500.00 together
with any
interest as
set forth
herein, on
August 27,
2014 (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, $0.001 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 9.99% 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 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
58% multiplied
by the Market
Price (as
defined herein)
(representing a discount rate
of 42%). “Market
Price” means
the average of
the lowest three
(3) 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, or applicable trading
market (the
“OTCBB”) as reported
by a
reliable reporting service
(“Reporting Service”)
designated by the Holder
(i.e. Bloomberg) or, if the
OTCBB 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”
by the National
Quotation Bureau,
Inc. 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 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 OTCBB, 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.

 

(ii)                                                  
 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 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 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.

 

		1.3	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 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.

 

(a)    
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 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.

    	2

    	 

    

 

(b)    
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.

 

(c)    
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.

 

(d)    
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 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.

 

(e)    
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.

 

(f)     
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.
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.

 

1.4   
 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
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.”

 

    	3

    	 

    

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
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.

 

		1.5	Effect
                                         of
                                         Certain
                                         Events.

 

(a)    
Effect of
Merger,
Consolidation,
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 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,
Consolidation, 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, consolidation,
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 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,
consolidation, 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 consolidations, 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
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.

 

    	4

    	 

    

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.

 

(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.

 

1.6   
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 9.99%
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.

 

1.7   
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 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.

 

    	5

    	 

    

1.8   
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
110%, 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 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 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 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 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 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 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 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 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.

 

    	6

    	 

    

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 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 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.

 

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 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 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
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)
indebtedness to trade
creditors or financial institutions incurred
in the ordinary course of business
or (c) borrowings, 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 any
significant portion
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.

 

    	7

    	 

    

 

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
fails to
issue shares
of Common Stock
to the Holder
(or announces
or threatens
in writing
that it
will not
honor its 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
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
OTCBB 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.

 

    	8

    	 

    

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
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
twenty (20) days prior
written notice to the Holder.

 

 

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 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.

 

    	9

    	 

    

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.

 

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:

 

CO-SIGNER,
INC.

6250
Mountain Vista Street -
Suite C-1 Henderson,
NV 89014

Attn:
DARREN M. MAGOT, Chief
Executive Officer 

facsimile:

 

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

Kyleen
Cane Cane•Clark LLP

3273
E. Warm Springs
Rd. Las
Vegas, NV
89120

 

If
to the Holder:

 

ASHER
ENTERPRISES, INC.

1
Linden Pl., Suite 207
Great Neck, NY. 11021

Attn: Curt Kramer,
President

 facsimile: 516-498-9894

 

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

Naidich Wurman Birnbaum &
Maday, LLP

80
Cuttermill Road, Suite
410 Great Neck,
NY 11021

Attn:
Bernard S. Feldman,
Esq.

 facsimile:
516-466-3555

 

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.

 

    	10

    	 

    

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
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,
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 November
25, 2013.

 

CO-SIGNER,
INC.

 

 By:
/s/ Darren M. Magot

DARREN M.
MAGOT

Chief Executive Officer

    	11

    	 

    

 

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 CO-SIGNER,
INC., a
Nevada corporation
(the “Borrower”)
according to the conditions of
the convertible note of the Borrower
dated as of
November 25,
2013 (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:

 

ASHER
ENTERPRISES, INC.

1
Linden Pl., Suite 207

Great Neck, NY. 11021

Attention:
Certificate Delivery (516)
498-9890

 

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:

 

ASHER
ENTERPRISES, INC.

 

By:

Name:
Curt Kramer

Title:
 President

Date:
 

1
Linden Pl., Suite 207

Great Neck, NY. 11021

    	12

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