Common use of Conversion into Common Stock Clause in Contracts

Conversion into Common Stock. Holders of shares of Series A Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of this paragraph D(a), each Holder of Series A Preferred Stock shall have the right at any time commencing after the issuance to such Holder of Series A Preferred Stock, to convert such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed by the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) into fully paid and non-assessable shares of Common Stock of the Corporation determined in accordance with the applicable conversion price provided in paragraph D(b) below (the “Conversion Price”). All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred Stock. (b) The number of shares of Common Stock issuable upon conversion of the Obligation Amount shall equal (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Obligation Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series A Preferred Stock shall be $0.40, subject to adjustment only as described herein. (c) Holder will give notice of its decision to exercise its right to convert the Series A Preferred Stock, or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmission. The Holder will not be required to surrender the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the Common Stock issuable upon conversion of the Series A Preferred Stock to the Holder via express courier for receipt by such Holder within three (3) business days after receipt by the Corporation of the Notice of Conversion (the “Delivery Date”). In the event the Common Stock is electronically transferable, then delivery of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate representing the balance of the Series A Preferred Stock not so converted will be provided by the Corporation to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holder. In the case of the exercise of the conversion rights set forth in paragraph D(a) hereof, the conversion privilege shall be deemed to have been exercised and the shares of Common Stock issuable upon such conversion shall be deemed to have been issued upon the date of receipt by the Corporation of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date and thereafter, be treated for all purposes as the recordholder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A Preferred Stock, to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole number.

Conversion into Common Stock. Holders (a) Each holder of shares of Series A B Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of this paragraph D(a), each Holder of Series A Preferred Stock shall will have the right at any time commencing after the issuance to such Holder of Series A Preferred StockConversion Right Commencement Date (as defined in Subparagraph 5(b)), at the holder's option, to convert such shares, accrued but unpaid declared dividends on all or any of the shares of Series A B Preferred Stock and any other sum owed held of record by the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered holder into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance a number of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) into fully paid and non-assessable shares of Common Stock (calculated as to each conversion to the nearest 1/100th of a share) equal to (i) the Series B Liquidation Preference, times (ii) the number of shares of Series B Preferred Stock being converted, divided by (iii) the Conversion Price (as defined in Subparagraph 5(e)) in effect on the date the shares of Series B Preferred Stock are surrendered to the Corporation determined or its agent for conversion provided, however, that the right to convert shares will terminate five days before the date fixed for redemption of those shares in a Redemption Notice given in accordance with Section 6, unless the applicable conversion price provided in paragraph D(b) below (the “Conversion Price”). All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred Stockshares are not redeemed as required by Section 6. (b) The Conversion Right Commencement Date will be the earlier of: (i) The thirtieth day after the first day on which there is no outstanding Series A Preferred Stock (whether because of conversions, redemption or otherwise); or (ii) The day on which there is a change of Control of the Corporation. (c) For the purposes of subsection (b)(ii), a "Change of Control of the Corporation" will occur when: (i) Any person (as that term is defined in Section 14(d) of the Securities Exchange Act of 1934, as amended) becomes the beneficial owner (as that term is defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended) of 30% or more of the outstanding Common Stock (provided that neither an acquisition of shares of Series B Preferred Stock nor the fact that the 41 Conversion Right Commencement Date has occurred or will occur on a particular date will constitute a Change of Control of the Corporation). (ii) The Corporation is a party to a merger or consolidation, other than a merger or consolidation in which the Corporation is the surviving entity and immediately after which the persons who hold Common Stock or convertible preferred stock of the Corporation immediately before the transaction will own (giving effect to the conversion of all currently convertible preferred stock) at least 66?% of the outstanding Common Stock. (iii) A majority of the members of the Board are persons who were not elected, or nominated for the election by the stockholders, to the Board for the first time by the affirmative vote of a majority of the directors who had served on the Board at the time of the election or nomination for at least 12 months. (i) In order to exercise the conversion privilege, the holder of each share of Series B Preferred Stock to be converted must surrender the certificate representing that share to the conversion agent for the Series B Preferred Stock appointed by the Corporation (which may be the Corporation itself), with the Notice of Election to Convert on the back of that certificate duly completed and signed, at the principal office of the conversion agent. If the shares issuable on conversion are to be issued in a name other than the name in which the Series B Preferred Stock is registered, each share surrendered for conversion must be accompanied by an instrument of transfer, in form satisfactory to the Corporation, duly executed by the holder or the holder's duly authorized attorney and by funds in an amount sufficient to pay any transfer or similar tax which is required to be paid in connection with the transfer or evidence that such tax has been paid. (ii) Each conversion will be at the Conversion Price in effect at the close of business on the day when all the conditions in Subparagraph 5(d)(i) have been satisfied. (iii) The holders of record of shares of Series B Preferred Stock surrendered for conversion will be entitled to receive, in addition to the shares of Common Stock or other assets to which they are entitled by reason of Paragraphs (a) and (e) of this Section, to the extent of legally available funds as prescribed by statute, a sum equal to all accumulated dividends due to have been paid with regard to the surrendered shares on all Dividend Payment Dates prior to the date of surrender which have not been paid. (iv) As promptly as practicable after the surrender by a holder of certificates representing shares of Series B Preferred Stock in accordance with this Subsection 5(d), the Corporation will issue and will deliver to the holder at the office of the conversion agent, or on the holder's written order, a certificate or certificates for the number of full shares of Common Stock issuable upon the conversion of the shares of Series B Preferred Stock. Any fractional interest in respect of a share of Common Stock arising upon a conversion will be settled as provided in Subsection 5(e). 42 (v) Each conversion will be deemed to have been effected immediately prior to the close of business on the date on which all the conditions specified in Subparagraph 5(d)(i) have been satisfied, and the person in whose name a certificate for shares of Common Stock is to be issued upon a conversion will be deemed to have become the holder of record of the shares of Common Stock represented by that certificate at that time. All shares of Common Stock delivered upon conversion of Series B Preferred Stock will upon delivery be duly and validly issued and fully paid and nonassessable, free of all liens and charges and not subject to any preemptive rights. Upon the surrender of certificates representing shares of Series B Preferred Stock for conversion and compliance with all the other requirements of Subparagraph 5(d)(i), the shares represented by those certificates will no longer be deemed to be outstanding and all rights of the holder with respect to those shares will immediately terminate, except the right to receive the Common Stock or other securities, cash or other assets to be issued or distributed as a result of the conversion. (e) No fractional shares of Common Stock will be issued upon conversion of Series B Preferred Stock. Any fractional interest in a share of Common Stock resulting from conversion of shares of Series B Preferred Stock will be paid in cash (computed to the nearest cent) based on the Current Market Price (as that term is defined in subparagraph 5(f)(viii)) of the Common Stock on the Trading Day (as that term is defined in Subparagraph 5(f)(viii)) next preceding the day of conversion. If more than one share of Series B Preferred Stock is surrendered for conversion at substantially the same time by the same holder, the number of full shares of Common Stock issuable upon the conversion will be computed on the basis of all the shares of Series B Preferred Stock surrendered at that time by that holder. (f) The conversion price per share of Series B Preferred Stock initially will be $1.900804 Series B Liquidation Preference per share of Common Stock, and will be adjusted as follows from time to time if any of the events described below shall have occurred (the "Conversion Price"). (i) If the Corporation (A) pays a dividend or makes a distribution on its Common Stock in shares of its Common Stock, (B) subdivides its outstanding Common Stock into a greater number of shares, or (C) combines its outstanding Common Stock into a smaller number of shares, the Conversion Price in effect immediately prior to that event will be adjusted so that the holder of a share of Series B Preferred Stock surrendered for conversion after that event will receive the number of shares of Common Stock of the Corporation which the holder would have received if the share of Series B Preferred Stock had been converted immediately before the happening of the event (or, if there is more than one such event, if the share of Series B Preferred Stock had been converted immediately before the first of those events and the holder had retained all the Common Stock or other securities or assets received after the conversion). An adjustment made pursuant to this Subparagraph 5(f)(i) will become effective immediately after the record date in the case of a dividend or distribution, except as provided in Subparagraph 5(f)(viii), and will become effective immediately after the effective date in the case of a subdivision or combination. If any such dividend or distribution is declared but is not paid or made, the Conversion Price then in effect will be appropriately readjusted. However, a readjustment of the Conversion Price will not affect any 43 conversion which takes place before the readjustment. (ii) If the Corporation issues rights or warrants to the holders of its Common Stock as a class entitling them (for a period expiring within 45 days after the record date for issuance of the rights or warrants) to subscribe for or purchase Common Stock at a price per share less than the Conversion Price at the record date for the determination of stockholders entitled to receive the rights or warrants (other than pursuant to a dividend reinvestment plan), then, unless the Corporation also issues such rights or warrants to the holders of Series B Preferred Stock as a class (based on the number of shares of Common Stock issuable upon conversion of such holders' Series B Preferred Stock), the Obligation Amount shall equal (i) Conversion Price in effect immediately before the sum issuance of (A) the Series A Stated Value being converted and/or (B) rights or warrants will be reduced so that it will be the amount determined by multiplying the Conversion Price in effect immediately before the record date for the issuance of the rights or warrants by a fraction of which the numerator is the number of shares of Common Stock outstanding on the record date for the issuance of the rights or warrants plus the number of shares of Common Stock which the aggregate exercise price of all the rights or warrants would purchase at the Holder’s electionConversion Price at that record date, accrued and unpaid dividends or any other component of which the denominator is the number of shares of Common Stock outstanding on the record date for the issuance of the Obligation Amountrights or warrants plus the number of additional shares of Common Stock issuable on exercise of all the rights or warrants. The adjustment provided for in this Subparagraph 5(f)(ii) will be made successively whenever any rights or warrants are issued, divided by (ii) and will become effective immediately, except as provided in Subparagraph 5(f)(viii), after each record date. If any rights or warrants which lead to an adjustment of the Conversion Price. The Price expire or terminate without having been exercised, the Conversion Price then in effect will be appropriately readjusted. However, a readjustment of the Series A Preferred Stock shall be $0.40, subject to adjustment only as described hereinConversion Price will not affect any conversions which take place before the readjustment. (ciii) Holder will give notice If the Corporation distributes to the holders of its decision Common Stock as a class any shares of capital stock of the Corporation (other than Common Stock) or evidences of indebtedness or assets (other than cash dividends or distributions of cash paid from earned surplus of the Corporation) or rights or warrants (other than those referred to exercise its right to convert the Series A Preferred Stock, or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of Designationin Subparagraph 5(f)(ii)) to subscribe for or purchase any of its securities, then (unless the Corporation via confirmed facsimile transmission. The Holder will not be required also distributes to surrender the holders of Series A B Preferred Stock certificate until as a class based on the Series A Preferred Stock has been fully converted. Each date on which a Notice number of Conversion is sent by facsimile to the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the shares of Common Stock issuable upon conversion of such holders' Series B Preferred Stock), in each such case, the Conversion Price will be reduced so that it will equal the price determined by multiplying the Conversion Price in effect immediately prior to the record date for the distribution by a fraction of which the numerator is the Current Market Price of the Common Stock on the record date for the distribution less the then fair market value (as determined by the Board of Directors, whose determination, if made in good faith, will be conclusive) of the capital stock, evidences of indebtedness, assets, rights or warrants which are distributed with respect to one share of Common Stock, and of which the denominator is the Current Market Price of the Common Stock on that record date. Each adjustment will, except as provided in Subparagraph 5(f)(ix), become effective immediately after the record date for the determination of the stockholders entitled to receive the distribution. If any distribution is declared but not made, or if any rights or warrants expire or terminate without having been exercised, 44 effective immediately after the decision is made not to make the distribution or the rights or warrants expire or terminate, the Conversion Price then in effect will be appropriately readjusted. However, a readjustment will not affect any conversions which take place before the readjustment. (iv) For the purposes of Subparagraphs 5(f)(ii) and (iii) and (iv), the price of shares of Common Stock issued or sold upon conversion or exchange of Convertible Securities or upon exercise of rights, options or warrants will be (A) the consideration paid to the Corporation for the Convertible Securities, rights, options or warrants, plus (B) the consideration paid to the Corporation upon conversion, exchange or exercise of the Convertible Securities, rights, options or warrants, with the value of the consideration, if other than cash, to be determined by the Board of Directors of the Corporation (whose determination, if made in good faith, will be conclusive) and any change in the conversion or exchange price of Convertible Securities or the exercise price of rights, options or warrants will be treated as an extinguishment when the change becomes effective, of the Convertible Securities, rights, options or warrants which had the old conversion, exchange or exercise price and an immediate issuance of new Convertible Securities, rights, options or warrants with the new conversion, exchange or exercise price. (v) If there is a reclassification or change of outstanding shares of Common Stock (other than a change in par value, or as a result of a subdivision or combination), or a merger or consolidation of the Corporation with any other entity that results in a reclassification, change, conversion, exchange or cancellation of outstanding shares of Common Stock, or a sale or transfer of all or substantially all of the assets of the Corporation and distribution of all or part of the proceeds of that sale or transfer, upon any subsequent conversion of Series B Preferred Stock, each holder of the Series A B Preferred Stock will be entitled to receive the Holder via express courier for receipt by such Holder within three kind and amount of securities, cash and other property which the holder would have received if the holder had converted the shares of Series B Preferred Stock into Common Stock immediately before the first of those events and had retained all the securities, cash and other assets received as a result of all those events. (3vi) business days after receipt by the Corporation The "Current Market Price" of the Notice Common Stock on any day will be the average of Conversion the Last Reported Sale Price (as defined below) per share of the “Delivery Date”)Common Stock on each of the twenty consecutive Trading Days (as defined below) preceding the date of the computation. In The "Last Reported Sale Price" of the event Common Stock on each day will be (A) the last reported sale price of the Common Stock on the principal stock exchange on which the Common Stock is electronically transferablelisted, then delivery or (B) if the Common Stock is not listed on a stock exchange, the last reported sale price of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by on the Holder. A Series A Preferred Stock certificate representing the balance principal automated securities price quotation system on which sale prices of the Series A Preferred Common Stock are reported, or (C) if the Common Stock is not so converted listed on a stock exchange and sale prices of the Common Stock are not reported on an automated quotation system, the mean of the high bid and low asked price quotations for the Common Stock as reported by National Quotation Bureau Incorporated if at least two securities dealers have inserted both bid and asked quotations for the Common Stock on at least five of the ten preceding Trading Days. If the Common Stock is not traded or quoted as described in any of clause (A), (B) or (C), the Current Market Price of the Common Stock on a day will be provided by the Corporation to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess fair market value of the actual amount Common Stock on that day as determined by a member firm of the Series A Stated Value then owned by the Holder. In the case of the exercise of the conversion rights set forth in paragraph D(a) hereof, the conversion privilege shall be deemed to have been exercised and the shares of Common New York Stock issuable upon such conversion shall be deemed to have been issued upon the date of receipt by the Corporation of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date and thereafter, be treated for all purposes as the recordholder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A Preferred Stock, to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole number.45

Conversion into Common Stock. Holders of shares Shares of Series A Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of and restrictions set forth in this paragraph D(a)5, each Holder of shares of Series A Preferred Stock shall have the right at any time commencing after the issuance to such the Holder of Series A Preferred StockStock and the Shareholder Approval (as defined below), to convert such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed by the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) shares into fully paid and non-assessable shares of Common Stock of the Corporation (as defined in paragraph 5(i) below) determined in accordance with the applicable conversion price Conversion Price provided in paragraph D(b5(b) below (the “"Conversion Price”)") by tendering to the Company the cash sum of $0.10 multiplied by the number of shares of Common Stock into which such shares of Series A Preferred Stock are then convertible. Such payment shall be made by certified check or wire transfer of funds to an account designated by the Company. All declared issued or accrued but unpaid dividends dividends, if any, may be converted at the election of the Holder together simultaneously with or independent of the conversion of principal amount of Stated Value of Series A Preferred Stock being converted. Notwithstanding anything herein to the contrary, the Series A Stated Value Preferred Stock shall not be convertible into Common Stock until such time as there are sufficient authorized but unissued shares of Common Stock of the Corporation for such purpose. Promptly following the issuance of shares of Series A Preferred Stock, the Corporation shall take such corporate action as may be reasonably necessary to increase its authorized but unissued shares of Common Stock to such number as shall be sufficient for such purpose, including engaging in commercially reasonable efforts to obtain the requisite shareholder approval (the "Shareholder Approval"); provided, however, that the rights contained in this Certificate shall constitute the Series A Preferred Stock holders' sole remedy in the event that the Corporation fails to obtain the requisite shareholder approval to increase the number of authorized but unissued shares of Common Stock in a manner sufficient to effect the conversion of all outstanding shares of Series A Preferred Stock. (b) The number of shares of Common Stock issuable upon conversion of the Obligation Amount shall equal (i) the sum each share of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Obligation Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series A Preferred Stock shall be two (2). The Conversion Price per share shall be $0.40, subject to adjustment only as described herein0.10. (c) Subject to the restrictions set forth in this Section 5, the Holder will of any certificate representing shares of Series A Preferred Stock desiring to convert any of such shares may give notice of its decision to exercise its right to convert the Series A Preferred Stock, shares into Common Stock by delivering or part thereof and/or accrued and unpaid dividends, by sending by facsimile telecopying an executed and completed Notice notice of Conversion conversion to the Corporation or the Corporation's Transfer Agent and delivering within three business days thereafter, the original certificate for the Preferred Stock properly endorsed for or accompanied by duly executed instruments of transfer (a form of which is annexed and such other transfer papers as Exhibit A to this Certificate of Designationsaid Transfer Agent may reasonably require) to the Corporation via confirmed facsimile transmission. The Holder will not or the Corporation's Transfer Agent, in addition to payment in full of the Conversion Price multiplied by the number of shares of Common Stock to be required to surrender the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully convertedissued upon conversion. Each date on which a Notice notice of Conversion conversion is sent by facsimile delivered or telecopied to the Corporation or the Corporation's Transfer Agent in accordance with the provisions hereof shall be deemed a Conversion Date. A form of Notice of Conversion that may be employed by a Holder is annexed hereto as Exhibit A. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the shares of Common Stock issuable upon conversion of any Series A Preferred Stock (together with the Series A Preferred Stock representing the shares not converted) to the Holder via express courier for receipt courier, by such Holder electronic transfer or otherwise, within three (3) four business days after receipt by the Corporation of the Notice original or telecopied notice of Conversion (the “Delivery Date”). In the event the Common Stock is electronically transferable, then delivery of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate representing the balance of conversion and the Series A Preferred Stock not representing the shares to be converted ("Delivery Date"). The Holder of the shares so converted will surrendered for conversion shall be provided by entitled to receive on or before the Delivery Date a certificate or certificates that shall be expressed to be fully paid and non-assessable for the number of shares of Common Stock to which such Holder shall be entitled upon such conversion registered in the name of such Holder. The Corporation is obligated to deliver to the Holder if requested by simultaneously with the aforedescribed Common Stock, at the election of the Holder, provided additional Common Stock representing the Holder has delivered conversion at the original Conversion Price, of dividends accrued on the Series A Preferred Stock certificate to being converted. In the Corporation. To the extent that a Holder elects not to surrender the certificate for such case of any Series A Preferred Stock for reissuance upon partial payment or conversion, that is converted in part only the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of shares of Series A Preferred Stock shall upon delivery of the actual amount certificate or certificates representing Common Stock also receive a new share certificate representing the unconverted portion of the shares of Series A Stated Value then owned by Preferred Stock. Nothing herein shall be construed to give any Holder of shares of Series A Preferred Stock surrendering the Holdersame for conversion the right to receive any additional shares of Common Stock or other property which results from an adjustment in conversion rights under the provisions of paragraph (d) or (e) of this paragraph 5 until Holders of Common Stock are entitled to receive the shares or other property giving rise to the adjustment. In the case of the exercise of the conversion rights set forth in paragraph D(a5(a) hereof, the conversion privilege shall be deemed to have been exercised and the shares of Common Stock issuable upon such conversion shall be deemed to have been issued upon the date of receipt by the Corporation or Transfer Agent of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date such conversion privilege is deemed to have been exercised and thereafter, be treated for all purposes as the recordholder record Holder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, Stock no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock Stock, and payment of dividends on Series A Preferred Stock, Stock to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole number. The Corporation and Holder may not convert that amount of the Series A Preferred Stock on a Conversion Date in amounts inconsistent with the limitations set forth in the Subscription Agreement in connection with that number of shares of Common Stock which would be in excess of the sum of (i) the number of shares of Common Stock beneficially owned by the Subscriber and its affiliates on such Conversion Date, and (ii) the number of shares of Common Stock issuable upon the conversion of the Series A Preferred Stock with respect to which the determination of this proviso is being made on such Conversion Date, which would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding shares of Common Stock of the Corporation. For the 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, and Regulation 13d-3 thereunder. The Holder may revoke the conversion limitation described in this Paragraph upon 75 days prior notice to the Corporation or upon an Event of Default hereunder. The Holder may allocate which of the equity of the Corporation deemed beneficially owned by the Holder shall be included in the 4.99% amount described above and which shall be allocated to the excess above 4.99%. (d) The Conversion Price determined pursuant to 4(b) shall be subject to adjustment from time to time as follows: (i) In case the Corporation shall at any time (A) declare any dividend or distribution on its Common Stock or other securities of the Corporation other than the Series A Preferred Stock, (B) split or subdivide the outstanding Common Stock, (C) combine the outstanding Common Stock into a smaller number of shares, or (D) issue by reclassification of its Common Stock any shares or other securities of the Corporation, then in each such event the Conversion Price shall be adjusted proportionately so that the Holders of Series A Preferred Stock shall be entitled to receive the kind and number of shares or other securities of the Corporation which such Holders would have owned or have been entitled to receive after the happening of any of the events described above had such shares of Series A Preferred Stock been converted immediately prior to the happening of such event (or any record date with respect thereto). Such adjustment shall be made whenever any of the events listed above shall occur. An adjustment made to the Conversion pursuant to this paragraph 5(d)(i) shall become effective immediately after the effective date of the event retroactive to the record date, if any, for the event. (i) In case of any merger of the Corporation with or into any other corporation (other than a merger in which the Corporation is the surviving or continuing corporation and which does not result in any reclassification, conversion, or change of the outstanding shares of Common Stock) then unless the right to convert shares of Series A Preferred Stock shall have terminated, as part of such merger lawful provision shall be made so that Holders of Series A Preferred Stock shall thereafter have the right to convert each share of Series A Preferred Stock into the kind and amount of shares of stock and/or other securities or property receivable upon such merger by a Holder of the number of shares of Common Stock into which such shares of Series A Preferred Stock might have been converted immediately prior to such consolidation or merger. Such provision shall also provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in paragraph (d) of this paragraph 5. The foregoing provisions of this paragraph 5(e) shall similarly apply to successive mergers. (ii) In case of any sale or conveyance to another person or entity of the property of the Corporation as an entirety, or substantially as an entirety, in connection with which shares or other securities or cash or other property shall be issuable, distributable, payable, or deliverable for outstanding shares of Common Stock, then, unless the right to convert such shares shall have terminated, lawful provision shall be made so that the Holders of Series A Preferred Stock shall thereafter have the right to convert each share of the Series A Preferred Stock into the kind and amount of shares of stock or other securities or property that shall be issuable, distributable, payable, or deliverable upon such sale or conveyance with respect to each share of Common Stock immediately prior to such conveyance. (f) Whenever the number of shares to be issued upon conversion of the Series A Preferred Stock is required to be adjusted as provided in this paragraph 5, the Corporation shall forthwith compute the adjusted number of shares to be so issued and prepare a certificate setting forth such adjusted conversion amount and the facts upon which such adjustment is based, and such certificate shall forthwith be filed with the Transfer Agent for the Series A Preferred Stock and the Common Stock; and the Corporation shall mail to each Holder of record of Series A Preferred Stock notice of such adjusted conversion price. (g) In case at any time the Corporation shall propose: (i) to pay any dividend or distribution payable in shares upon its Common Stock or make any distribution (other than cash dividends) to the Holders of its Common Stock; or (ii) to offer for subscription to the Holders of its Common Stock any additional shares of any class or any other rights; or (iii) any capital reorganization or reclassification of its shares or the merger of the Corporation with another corporation (other than a merger in which the Corporation is the surviving or continuing corporation and which does not result in any reclassification, conversion, or change of the outstanding shares of Common Stock); or (iv) the voluntary dissolution, liquidation or winding-up of the Corporation; then, and in any one or more of said cases, the Corporation shall cause at least fifteen (15) days prior notice of the date on which (A) the books of the Corporation shall close or a record be taken for such stock dividend, distribution, or subscription rights, or (B) such capital reorganization, reclassification, merger, dissolution, liquidation or winding-up shall take place, as the case may be, to be mailed to the Transfer Agent for the Series A Preferred Stock and for the Common Stock and to the Holders of record of the Series A Preferred Stock. (h) So long as any shares of Series A Preferred Stock shall remain outstanding and the Holders thereof shall have the right to convert the same in accordance with provisions of this paragraph 5 the Corporation shall at all times reserve from the authorized and unissued shares of its Common Stock a sufficient number of shares to provide for such conversions, subject to the Corporation's obligation to seek shareholder approval to increase its authorized but unissued Common Stock as set forth in paragraph 5(a). (i) The term Common Stock as used in this paragraph 5 shall mean the $.001 par value Common Stock of the Corporation as such stock is constituted at the date of issuance thereof or as it may from time to time be changed or shares of stock of any class of other securities and/or property into which the shares of Series A Preferred Stock shall at any time become convertible pursuant to the provisions of this paragraph 5. (j) The Corporation shall pay the amount of any and all issue taxes (but not income taxes) which may be imposed in respect of any issue or delivery of stock upon the conversion of any shares of Series A Preferred Stock, but all transfer taxes and income taxes that may be payable in respect of any change of ownership of Series A Preferred Stock or any rights represented thereby or of stock receivable upon conversion thereof shall be paid by the person or persons surrendering such stock for conversion. (k) In the event a Holder shall elect to convert any shares of Series A Preferred Stock as provided herein, the Corporation may not refuse conversion based on any claim that such Holder or any one associated or affiliated with such Holder has been engaged in any violation of law, or for any other reason unless, an injunction from a court, on notice, restraining and or enjoining conversion of all or part of said shares of Series A Preferred Stock shall have been issued and the Corporation posts a surety bond for the benefit of such Holder in the amount of 150% of the Stated Value of the Series A Preferred Stock and dividends sought to be converted, which is subject to the injunction, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and the proceeds of which shall be payable to such Holder in the event it obtains judgment.

Conversion into Common Stock. Holders of shares of Series A Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions The holder of this paragraph D(a), each Holder any Shares of Series A B Preferred Stock shall have the right at any time commencing after such holder's option, unless and until such shares shall have been redeemed pursuant to Section 4 above, by the issuance giving of written notice thereof to the Corporation, which written notice shall have been received by the Corporation prior to the Redemption Date established pursuant to Section 4(a) hereof or such Holder later date as may be determined pursuant to Section (4) hereof (the date of Series A Preferred Stockreceipt of notice pursuant to this subsection being referred to herein as the "Conversion Date"), to convert up to 25% of such sharesshares of Series B Preferred Stock on or after the 90th day after February 26, accrued but unpaid declared dividends on 1998 ("Closing"), and up to a further 25% every 30 days thereafter; unless the Common Stock trades at or below $1.50 at the Conversion Date and the Corporation does not redeem the Series A B Preferred Stock and pursuant to Section 4, in which case the holder of any other sum owed by the Corporation arising from the Shares of Series A B Preferred Stock or pursuant to may convert only a maximum of 10% of the Subscription Agreement entered principal invested during a period of consecutive 20 day intervals, into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance such number of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) into fully paid and non-assessable nonassessable shares of Common Stock obtained by multiplying the Conversion Value per share of Series B Preferred Stock by the number of shares of Series B Preferred Stock being converted, and dividing such product by the Conversion Price (as then in effect). The Conversion Price per share at which shares of Common Stock shall be issuable upon conversion of shares of Series B Preferred Stock shall be, subject to adjustment as provided in this Section 5, equal to the lesser of (a) the five-day average closing bid price of the Corporation determined in accordance with Common Stock prior to February 26, 1998 or (b) a 15% discount of the applicable conversion five-day average closing bid price provided in paragraph D(b) below (of the “Conversion Price”)Common Stock immediately prior to the notice of conversion. All declared or The holder of any shares of Series B Preferred Stock converted into shares of Common Stock pursuant to this Section 5 shall be entitled to payment of all accrued but unpaid dividends may be dividends, if any, payable with respect to such shares being converted at up to and including the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred StockConversion Date. (b) The number of shares of Common Stock issuable upon conversion of the Obligation Amount shall equal (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Obligation Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series A Preferred Stock shall be $0.40, subject to adjustment only as described herein. (c) Holder will give notice of its decision In order to exercise its the right to convert the Series A Preferred Stock, or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmission. The Holder will not be required to surrender the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the Common Stock issuable upon conversion of the Series A B Preferred Stock pursuant to the Holder via express courier for receipt by such Holder within three subsection (3a) business days after receipt by the Corporation of the Notice of Conversion (the “Delivery Date”). In the event the Common Stock is electronically transferable, then delivery of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate representing the balance of the Series A Preferred Stock not so converted will be provided by the Corporation to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversionthis Section 5, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holder. In the case of the exercise of the conversion rights set forth in paragraph D(a) hereof, the conversion privilege shall be deemed to have been exercised and the shares of Common Stock issuable upon such conversion shall be deemed to have been issued upon the date of receipt by the Corporation of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date and thereafter, be treated for all purposes as the recordholder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion holder of any shares of Series A B Preferred Stock shall deliver to the Corporation during regular business hours, at the office of any transfer agent of the Corporation for the Series B Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on at the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion principal office of the Series A Preferred Stock and payment of dividends on Series A Preferred StockCorporation or at such other place as may be designated by the Corporation, to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock the certificate representing the next higher whole number.or

Conversion into Common Stock. Holders of shares of Series A Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of this paragraph D(a), each Holder of Series A Preferred Stock shall have the right at At any time commencing after the issuance to such Holder of Series A Preferred Stock, to convert such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed by the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) into fully paid and non-assessable Company has shares of Common Stock authorized and available for issuance, the Company may require any holder of any outstanding shares of Series B Preferred Stock to convert all or a portion of such holder's shares of Series B Preferred Stock into a number of shares of Common Stock determined by dividing (i) $1,000 by (ii) the Corporation determined in accordance with the then-applicable conversion price provided in paragraph D(b) below (the “Conversion Price”. The Company may exercise such right by providing written notice of such conversion to such holder(s). All declared or accrued but unpaid dividends may Such notice shall specify the "Conversion Date," which shall be converted at least five (5) days after the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred Stockdate such notice is given. (b) The Without limiting the generality of Section 7(a) above, upon any amendment to the Company's Articles of Incorporation that becomes effective after the date this Certificate of Designation is filed by the State of Michigan that increases the number of shares of Common Stock the Company is authorized to issue to a number of shares at least as great as the number of shares of Common Stock issuable upon conversion of all then outstanding shares of Series B Preferred Stock into Common Stock (the Obligation Amount date the Articles of Incorporation are amended to reflect such increase is referred to as the "Automatic Conversion Date"), each issued and outstanding share of Series B Preferred Stock shall equal be automatically converted into a number of shares of Common Stock determined by dividing (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Obligation Amount, divided $1,000 by (ii) the then-applicable Conversion Price. The Conversion Price , without further action by either the Company or any holder of the a share of Series A B Preferred Stock shall be $0.40, subject to adjustment only as described hereinStock. (c) Holder will give notice Effective as of its decision to exercise its the close of business on the Automatic Conversion Date or any Conversion Date, any certificate representing any shares of Series B Preferred Stock shall evidence only the right to convert receive the shares of Common Stock in which such shares of Series A Preferred Stock, or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmission. The Holder will not be required to surrender the Series A B Preferred Stock have been converted. As soon as practicable after the Automatic Conversion Date or any Conversion Date, the Company shall take such action as is necessary to exchange any certificate until the representing shares of Series A B Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Corporation will itself, for one or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock more certificates representing the Common Stock issuable upon conversion of the into which such Series A B Preferred Stock was converted or to the Holder via express courier for receipt by otherwise reflect issuance of such Holder within three (3) business days after receipt by the Corporation of the Notice of Conversion (the “Delivery Date”). In the event the Common Stock is electronically transferable, then delivery of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate representing the balance of the Series A Preferred Stock not so converted will be provided by the Corporation to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holder. In the case of the exercise of the conversion rights set forth in paragraph D(a) hereof, the conversion privilege shall be deemed to have been exercised and the shares of Common Stock issuable upon such conversion shall be deemed to have been issued upon the date of receipt by the Corporation of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date and thereafter, be treated for all purposes as the recordholder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A Preferred Stock, to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole numberbook entry form.

Conversion into Common Stock. Holders of shares of Series A Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of this paragraph D(a), each Holder of Series A Preferred Stock shall have the right at any time commencing after the issuance to such Holder of Series A Preferred Stock, to convert such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed by the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a ““ Subscription AgreementAgreement ”) (collectively ““ Obligation AmountAmount ”) into fully paid and non-assessable shares of Common Stock of the Corporation determined in accordance with the applicable conversion price provided in paragraph D(b) below (the ““ Conversion PricePrice ”). All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred Stock. (b) The number of shares of Common Stock issuable upon conversion of the Obligation Amount shall equal (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Obligation Amount, divided by (ii) the Conversion Price. The Conversion Price of the Series A Preferred Stock shall be $0.40, subject to adjustment only as described herein. (c) Holder will give notice of its decision to exercise its right to convert the Series A Preferred Stock, or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmission. The Holder will not be required to surrender the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation in accordance with the provisions hereof shall be deemed a Conversion Date. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the Common Stock issuable upon conversion of the Series A Preferred Stock to the Holder via express courier for receipt by such Holder within three (3) business days after receipt by the Corporation of the Notice of Conversion (the ““ Delivery DateDate ”). In the event the Common Stock is electronically transferable, then delivery of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate representing the balance of the Series A Preferred Stock not so converted will be provided by the Corporation to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holder. In the case of the exercise of the conversion rights set forth in paragraph D(a) hereof, the conversion privilege shall be deemed to have been exercised and the shares of Common Stock issuable upon such conversion shall be deemed to have been issued upon the date of receipt by the Corporation of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date and thereafter, be treated for all purposes as the recordholder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A Preferred Stock, to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole number.

Conversion into Common Stock. Holders of shares Shares of Series A B Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of this paragraph D(a)5, each Holder holder of shares of Series A B Preferred Stock shall have the right right, at any time commencing and from time to after forty-five (45) days from the issuance to such Holder date on which a share of Series A B Preferred StockStock was issued, to convert some or all such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed by the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) shares into fully paid and non-assessable shares of Common Stock of the Corporation (as defined in subparagraph 5(j) below) determined in accordance with the applicable conversion price Conversion Price provided in paragraph D(b5(c) below below. (b) Subject to the further provisions of this paragraph 5, the Corporation shall have the right, at its option at any time after forty-five (45) days from the date on which a share of Series B Preferred Stock was issued, to cause each holder of such shares of Series B Preferred Stock to convert such shares into fully paid and non-assessable shares of Common Stock of the Corporation at the Conversion Price during the thirty (30) day period beginning on the day after the fifth consecutive day the Closing Bid Price equals or exceeds 150% of the Stated Value per share (the “"Mandatory Conversion Price”Period"). All declared or accrued but unpaid dividends may be converted at the election Notice of the Holder together with or independent of the such mandatory conversion of the Series A Stated Value B Preferred Stock pursuant to this paragraph 5(b) shall be given by mail or in such other manner as may be prescribed by resolution of the Series A Preferred StockBoard of Directors of the Corporation not later than the expiration of the Mandatory Conversion Period. As applicable, the notice shall specify the number of shares to be converted, the date of conversion and the Conversion Price per share. (bc) The number of shares of Common Stock issuable upon conversion of the Obligation Amount each share of Series B Preferred Stock shall equal (i) the sum of (A) the Series A Stated Value being converted and/or per share and (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Obligation Amount, on such share divided by (ii) the Conversion Price. The "Conversion Price of the Series A Preferred Stock Price" shall be equal to $0.402.00 per share of Common Stock, subject to adjustment only as described hereinherein provided. (cd) Holder will give The holder of any certificate for shares of Series B Preferred Stock desiring to convert any of such shares or whose shares where converted at the election of the Corporation pursuant to the provisions of this paragraph 5 shall surrender such certificate, at the principal office of any transfer agent for said stock (the "Transfer Agent"), with a written notice of its decision to exercise its right such election to convert (if such conversion is voluntary) such shares into Common Stock duly filled out and executed, and if necessary under the Series A Preferred Stockcircumstances of such conversion, with such certificate properly endorsed for, or part thereof and/or accrued accompanied by duly executed instruments of, transfer (and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed such other transfer papers as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmissionsaid Transfer Agent may reasonably require). The Holder will not be required to surrender holder of the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation in accordance with the provisions hereof shares so surrendered for conversion shall be deemed a Conversion Date. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the Common Stock issuable upon conversion of the Series A Preferred Stock entitled to the Holder via express courier for receipt by such Holder receive within three (3) business days after receipt by the Corporation of the Notice of Conversion (except as otherwise provided herein) a certificate or certificates, which shall be expressed to be fully paid and non-assessable, for the “Delivery Date”)number of shares of Common Stock to which such stockholder shall be entitled upon such conversion, registered in the name of such holder or in such other name or names as such stockholder in writing may specify. In the event case of any Series B Preferred Stock which is converted in part only, the Common holder of shares of Series B Preferred Stock is electronically transferable, then shall upon delivery of the certificate or certificates representing Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock also receive a new share certificate representing the balance unconverted portion of the shares of Series A B Preferred Stock. Nothing herein shall be construed to give any holder of shares of Series B Preferred Stock not so converted will be provided by surrendering the Corporation same for conversion the right to receive any additional shares of Common Stock or other property which results from an adjustment in conversion rights under the provisions of subparagraphs (e) or (f) of this paragraph 5 until holders of Common Stock are entitled to receive the shares or other property giving rise to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holderadjustment. In the case of the exercise of the conversion rights set forth in paragraph D(aparagraphs 5(a) hereofand 5(b), the conversion privilege shall be deemed to have been exercised exercised, and the shares of Common Stock issuable upon such conversion shall be deemed to have been issued issued, upon the date of receipt by the Corporation such Transfer Agent for conversion of the Notice certificate for such shares of ConversionSeries B Preferred Stock. In the case of the automatic conversion set forth in paragraph 5(b), conversion shall be deemed to have occurred as provided in paragraph 5(b). The person or entity entitled to receive Common Stock issuable upon such conversion shall, shall on the date such conversion privilege is deemed to have been exercised and thereafter, thereafter be treated for all purposes as the recordholder record holder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder holder of such shares of Series A B Preferred Stock so converted. Notwithstanding the foregoing, if the stock transfer books are closed on the date such shares are received by the Transfer Agent, the conversion privilege shall be deemed to have been exercised, and the person or entity shall be treated as a record holder of shares of Common Stock, on the next succeeding date on which the transfer books are open, but the Conversion Price shall be that in effect on the date such conversion privilege was exercised. The Corporation shall not be required to deliver certificates for shares of its Common Stock or new certificates for unconverted shares of its Series B Preferred Stock while the stock transfer books for such respective classes of stock are duly closed for any purpose; but the right of surrendering shares of Series B Preferred Stock for conversion shall not be suspended during any period that the stock transfer books of either of such classes of stock are closed. Upon the conversion of any shares of Series A B Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on shares of such stock or on account of any dividend on the Common Stock, except that the Holder holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The conversion privilege shall also be subject to the following terms and conditions: (i) if any shares of Series B Preferred Stock shall be called for redemption, the conversion privilege in respect of such shares shall terminate at the close of business on the last business day next preceding the applicable Redemption Date; and (ii) if the Corporation shall at any time be liquidated, dissolved or wound-up, the conversion privilege shall terminate at the close of business on the last business day next preceding the effective date of such liquidation, dissolution or winding-up. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A B Preferred Stock, to issue a fraction of a share of its Common Stock nor to deliver any stock certificate representing a fraction thereof, but in lieu thereof the Corporation may make a cash payment equal to such fraction multiplied by the Closing Bid Price on the date the conversion right was triggered. (e) The Conversion Price shall be subject to adjustment from time to time as follows: (i) In case the Corporation shall at any time (A) declare any dividend or distribution on its Common Stock or other securities of the Corporation other than the Series A Preferred Stock, (B) split or subdivide the outstanding Common Stock, (C) combine the outstanding Common Stock into a smaller number of shares or (D) issue by reclassification of its Common Stock any shares or other securities of the Corporation, then, in each such event, the Conversion Price shall be adjusted proportionately so that the holders of Series B Preferred Stock shall be entitled to receive the kind and number of shares or other securities of the Corporation which such holders would have owned or have been entitled to receive after the happening of any of the events described above had such shares of Series B Preferred Stock been converted immediately prior to the happening of such event (or any record date with respect thereto). Such adjustment shall be made whenever any of the events listed above shall occur. An adjustment made to the Conversion pursuant to this paragraph 5(e)(i) shall become effective immediately after the effective date of the event retroactive to the record date, if any, for the event. (i) In case of any consolidation or merger of the Corporation with or into any other corporation (other than a merger or consolidation in which the Corporation is the surviving or continuing corporation and which does not result in any reclassification, conversion or change of the outstanding shares of Common Stock), then, unless the right to convert shares of Series B Preferred Stock shall have terminated, as part of such consolidation or merger, lawful provision shall be made so that holders of Series B Preferred Stock shall thereafter have the right to convert each share of Series B Preferred Stock into the kind and amount of shares of stock and/or other securities or property receivable upon such consolidation or merger by a holder of the number of shares of Common Stock into which such shares of Series B Preferred Stock might have been converted immediately prior to such consolidation or merger. Such provision shall also provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in paragraph (e) of this paragraph 5. The foregoing provisions of this paragraph 5(f) shall similarly apply to successive consolidations and mergers. (ii) In case of any sale or conveyance to another person or entity of the property of the Corporation as an entirety, or substantially as an entirety, in connection with which shares or other securities or cash or other property shall be issuable, distributable, payable or deliverable for outstanding shares of Common Stock, then, unless the right to convert such shares shall have terminated, lawful provision shall be made so that the holders of Series B Preferred Stock shall thereafter have the right to convert each share of the Series B Preferred Stock into the kind and amount of shares of stock or other securities or property that shall be issuable, distributable, payable or deliverable upon such sale or conveyance with respect to each share of Common Stock immediately prior to such conveyance. (g) Whenever the number of shares to be issued upon conversion of the Series B Preferred Stock is required to be adjusted as provided in this paragraph 5, the Corporation shall forthwith compute the adjusted number of shares to be so issued and prepare a certificate setting forth such adjusted conversion amount and the facts upon which such adjustment is based, and such certificate shall forthwith be filed with the Transfer Agent for the Series B Preferred Stock and the Common Stock; and the Corporation shall mail to each holder of record of Series B Preferred Stock notice of such adjusted conversion price. (h) In case at any time the Corporation shall propose: (i) to pay any dividend or distribution payable in shares upon its Common Stock or make any distribution (other than cash dividends) to the holders of its Common Stock; or (ii) to offer for subscription to the holders of its Common Stock any additional shares of any class or any other rights; or (iii) any capital reorganization or reclassification of its shares, or the consolidation or merger of the Corporation with another corporation; or (iv) the voluntary dissolution, liquidation or winding-up of the Corporation; (i) So long as any shares of Series B Preferred Stock shall remain outstanding and the holders thereof shall instead deliver have the right to convert the same in accordance with provisions of this paragraph 5, the Corporation shall at all times reserve from the authorized and unissued shares of its Common Stock a sufficient number of shares to provide for such conversions. (j) The term "Common Stock" as used in this paragraph 5 shall mean Common Stock of the Corporation as such stock certificate representing is constituted at the next higher whole numberdate of issuance thereof or as it may from time to time be changed, or shares of stock of any class, other securities and/or property into which the shares of Series B Preferred Stock shall at any time become convertible pursuant to the provisions of this paragraph 5.

Conversion into Common Stock. Holders A. All or any portion of the principal amount and all unpaid accrued interest of this Note shall be convertible into shares of Series A Preferred Stock shall have the following conversion rights and obligations: Company’s common stock share (a) Subject to the further provisions of this paragraph D(a“Common Stock”), each at the option of the Holder of Series A Preferred Stock shall have the right at any time commencing after the issuance or from time to such Holder of Series A Preferred Stock, to convert such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed by the Corporation arising from the Series A Preferred Stock or pursuant time prior to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) into fully paid and non-assessable shares of Common Stock of the Corporation determined in accordance with the applicable conversion price provided in paragraph D(b) below (the “Conversion Price”)Maturity Date. All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred Stock. (b) The number of shares of Common Stock issuable upon any conversion pursuant to this Section 3 shall equal the outstanding principal amount of this Note and all unpaid accrued interest to be converted, divided by $.03 and subject to adjustment from time to time under Section 5 (the “Conversion Price”). The Holder shall effect conversions under this Section 3 by delivering to the Company a conversion notice in substantially the form of Exhibit A hereto (the “Conversion Notice”).The date on which the Holder gives a Conversion Notice shall be the “Conversion Date.” If the Holder is converting less than all of the principal amount of this Note, the Company shall honor such conversion to the extent permissible hereunder and shall promptly deliver to the Holder a schedule indicating the principal amount that has not been converted. B. The Company covenants that it will at all times reserve and keep available out of its authorized but unissued and otherwise unreserved Common Stock, solely for the purpose of enabling it to issue shares of Common Stock as required hereunder, the number of shares of Common Stock which are then issuable and deliverable upon the conversion of this entire Note (taking into account the Obligation Amount shall equal (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s electionadjustments set forth in Section 5, accrued and unpaid dividends free from preemptive rights or any other component contingent purchase rights of any party other than the Obligation Amount, divided by (ii) the Conversion PriceHolder. The Conversion Price Company covenants that all shares of the Series A Preferred Common Stock shall be $0.40so issuable and deliverable shall, subject to adjustment only as described herein. (c) Holder will give notice of its decision to exercise its right to convert the Series A Preferred Stock, or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmission. The Holder will not be required to surrender the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation upon issuance in accordance with the provisions hereof shall be deemed a Conversion Date. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the Common Stock issuable upon conversion of the Series A Preferred Stock to the Holder via express courier for receipt by such Holder within three (3) business days after receipt by the Corporation of the Notice of Conversion (the “Delivery Date”). In the event the Common Stock is electronically transferable, then delivery of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate representing the balance of the Series A Preferred Stock not so converted will be provided by the Corporation to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holder. In the case of the exercise of the conversion rights set forth in paragraph D(a) terms hereof, the conversion privilege shall be deemed to have been exercised duly and the shares of Common Stock issuable upon such conversion shall be deemed to have been validly authorized and issued upon the date of receipt by the Corporation of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date and thereafter, be treated for all purposes as the recordholder of such Common Stock fully paid and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A Preferred Stock, to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole numbernonassessable.

Conversion into Common Stock. Holders of shares Shares of Series A Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of this paragraph D(a)Section 5, each Holder holder of shares of Series A Preferred Stock shall have the right at any time commencing after the issuance to such Holder of Series A Preferred Stock, to convert such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed by the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) such holder to convert such shares into fully paid and non-assessable shares of the Parent's Common Stock of (as defined in Section 5(i) below) at the Corporation determined in accordance with the applicable conversion price Conversion Price provided in paragraph D(bSection 5(b) below (the “Conversion Price”)below. All declared issued or accrued but unpaid dividends may be converted at the election of the Holder together holder simultaneously with or independent of the conversion of the Series A Stated Value Preferred Stock being converted. Subject to the last sentence of the this Section 5(a), no holder of Series A Preferred Stock shall be entitled to convert, nor shall the Corporation require any Holder to accept, pursuant to the terms of this Section 5(a) that amount of the Preferred Stock convertible into that number of shares of Common Stock which would result in the Holder's beneficial ownership (as defined below) of Parent's Common Stock being in excess of 4.99% of the outstanding shares of Parent's Common Stock. For the purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and Regulation 13d-3 thereunder. A Holder of Series A Preferred Stock may void the conversion limitation described in this Section 5(a): (i) upon 75 days prior notice to the Corporation or (ii) upon an Event of Default hereunder. (b) The number of shares of Common Stock issuable upon conversion of the Obligation Amount each share of Series A Preferred Stock shall equal (i) the sum of (A) the Series A Stated Value being converted and/or per share, as amended pursuant to Section 5 hereof, and (B) at the Holder’s holder's election, accrued and unpaid dividends or any other component of the Obligation Amounton such share, divided by (ii) $3.93 (the "Conversion Price").On each anniversary of the date hereof, the Conversion Price then in effect shall be reset at a price calculated by using the average of the five (5) lowest closing prices of the Parent's Common Stock for the twenty two (22) trading days prior to such anniversary date. Notwithstanding the immediately foregoing, in no event shall the Conversion Price ever be less than three dollars and fifty cents ($3.50). If after the Default Notice Period (as defined below) the Parent has not paid in full the amounts then due hereunder or cured the Event of Default, then the Conversion Price shall be reduced and shall be equal to the lower of (i) the Conversion Price. The Conversion Price ; or (ii) eighty percent (80%) of the Series A Preferred average of the three (3) lowest closing prices for the Parent's Common Stock shall be $0.40on a whichever Principal Market at the time the principal trading exchange or market for the Parent's Common Stock, subject or on any securities exchange or other securities market on which the Parent's Common Stock is then being listed or traded, for the thirty (30) trading days prior to adjustment only as described hereinbut not including the Conversion Date. (c) Holder will The holder of any certificate for shares of Series A Preferred Stock desiring to convert any of such shares may give notice of its decision to exercise its right to convert the shares into common stock by delivering, along with the certificate(s) representing the shares of Series A Preferred StockStock to be converted if requested by the Corporation, or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed notice of conversion ("Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of DesignationConversion") to the Corporation via confirmed facsimile transmission. The Holder will not be required to surrender or the Series A Preferred Stock certificate until Corporation's Transfer Agent (the Series A Preferred Stock has been fully converted"Conversion Date"). Each date on which a Notice notice of Conversion conversion is sent by facsimile delivered or telecopied to the Corporation or the Corporation's Transfer Agent in accordance with the provisions hereof shall be deemed a Conversion Date. A form of Notice of Conversion that may be employed by a holder is annexed hereto as Exhibit A. The Corporation will itself, or cause the Corporation’s transfer agent to, to transmit the Corporation’s Common Stock certificates representing the shares of the Parent's Common Stock issuable upon conversion of the Series A Preferred Stock (and a certificate representing the balance of the Preferred Stock not so converted, if requested by Purchaser) to the Holder via express courier for receipt holder by such Holder crediting the account of the Holder's prime broker with the Depository Trust Corporation ("DTC") through its Deposit Withdrawal Agent Commission ("DWAC") system within three (3) business days after receipt by the Corporation of the Notice of Conversion (and the “Delivery Date”). In certificate(s) representing the event the Common Stock is electronically transferable, then delivery shares of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate to be converted (the "Delivery Date"). The Parent is obligated to deliver to the holder simultaneously with the aforedescribed Common Stock, at the election of the Holder, additional shares of the Parent's Common Stock representing the balance conversion at the Conversion Price, of dividends accrued on the Series A Preferred Stock not so converted will be provided by being converted. The Corporation understands that a delay in the delivery of the Parent's Common Stock in the form required pursuant to this Section beyond the Delivery Date could result in economic loss to the Holder. In the event that the Corporation fails to direct its transfer agent to deliver the Parent's Common Stock to the Holder if requested by Holder, provided within the time frame set forth in Section 5 and the Common Stock is not delivered to the Holder has delivered by the original Series A Preferred Stock certificate Delivery Date, as compensation to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversionloss, the Corporation agrees to pay late payments to the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess for late issuance of the Parent's Common Stock in the form required pursuant to this Section 5 in the amount equal to the greater of (i) $400 per business day after the Delivery Date and (ii) the holder's actual damages from such delayed delivery. The Parent shall pay any payments incurred under this Section in immediately available funds upon demand and, in the case of actual damages, accompanied by reasonable documentation of the amount of the Series A Stated Value then owned by the Holdersuch damages. In the case of the exercise of the conversion rights set forth in paragraph D(aSection 5(a) hereof, the conversion privilege shall be deemed to have been exercised and the shares of Parent's Common Stock issuable upon such conversion shall be deemed to have been issued upon the date of receipt by the Corporation or Transfer Agent of the Notice of Conversion. The person or entity entitled to receive Parent's Common Stock issuable upon such conversion shall, on the date such conversion privilege is deemed to have been exercised and thereafter, be treated for all purposes as the recordholder record holder of such Parent's Common Stock and shall on the same date cease to be treated for any purpose as the record Holder holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, Stock no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation Parent shall not be required, in connection with any conversion of the Series A Preferred Stock Stock, and payment of dividends on Series A Preferred Stock, Stock to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole number. (d) The Conversion Price determined pursuant to Section 5(b) shall be subject to adjustment from time to time as follows: (i) In case the Corporation shall at any time (A) declare any dividend or distribution on its Common Stock or other securities of the Corporation other than the Series A Preferred Stock, (B) split or subdivide the outstanding Common Stock, (C) combine the outstanding Common Stock into a smaller number of shares, or (D) issue by reclassification of its Common Stock any shares or other securities of the Corporation, then in each such event the Conversion Price shall be adjusted proportionately so that the holders of Series A Preferred Stock shall be entitled to receive the kind and number of shares or other securities of the Corporation which such holders would have owned or have been entitled to receive after the happening of any of the events described above had such shares of Series A Preferred Stock been converted immediately prior to the happening of such event (or any record date with respect thereto). Such adjustment shall be made whenever any of the events listed above shall occur. An adjustment made to the Conversion Price pursuant to this Section 5(d)(i) shall become effective immediately after the effective date of the event for the event. (i) In case of any merger of the Corporation with or into any other corporation (other than a merger in which the Corporation is the surviving or continuing corporation and which does not result in any reclassification, conversion, or change of the outstanding shares of Common Stock) then unless the right to convert shares of Series A Preferred Stock shall have terminated, as part of such merger lawful provision shall be made so that holders of Series A Preferred Stock shall thereafter have the right to convert each share of Series A Preferred Stock into the kind and amount of shares of stock and/or other securities or property receivable upon such merger by a holder of the number of shares of Common Stock into which such shares of Series A Preferred Stock might have been convertible by the holder immediately prior to such consolidation or merger. Such provision shall also provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in Section (d) of this Section 5. The foregoing provisions of this Section 5(e) shall similarly apply to successive mergers. (ii) In case of any sale or conveyance to another person or entity of the property of the Corporation as an entirety, or substantially as an entirety, in connection with which shares or other securities or cash or other property shall be issuable, distributable, payable, or deliverable for outstanding shares of Common Stock, then, unless the right to convert such shares shall have terminated, lawful provision shall be made so that the holders of Series A Preferred Stock shall thereafter have the right to convert each share of the Series A Preferred Stock into the kind and amount of shares of stock or other securities or property that shall be issuable, distributable, payable, or deliverable upon such sale or conveyance with respect to each share of Common Stock immediately prior to such conveyance. (f) Whenever the number of shares to be issued upon conversion of the Series A Preferred Stock is required to be adjusted as provided in this Section 5, the Corporation shall forthwith compute the adjusted number of shares to be so issued and prepare a certificate setting forth such adjusted conversion amount and the facts upon which such adjustment is based, and such certificate shall forthwith be filed with the Transfer Agent for the Series A Preferred Stock and the Common Stock; and the Corporation shall mail to each holder of record of Series A Preferred Stock notice of such adjusted conversion price. (g) So long as any shares of Series A Preferred Stock shall remain outstanding and the holders thereof shall have the right to convert the same in accordance with provisions of this Section 6 the Corporation shall at all times reserve from the authorized and unissued shares of its Common Stock a sufficient number of shares to provide for such conversions.

Conversion into Common Stock. Holders of shares Shares of Series A AA Preferred Stock shall have the following conversion rights and obligations: (a) Subject to the further provisions of this paragraph D(a)Section 5, each Holder holder of shares of Series A AA Preferred Stock shall have the right at any time commencing after during the issuance to such Holder of Series A Preferred Stock, to convert such shares, accrued but unpaid declared dividends period beginning on the Series A Preferred Stock and any other sum owed by the Corporation arising from date of issuance of the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A AA Preferred Stock (each a “Subscription Agreement”the "Conversion Period") (collectively “Obligation Amount”) to convert some or all such shares into fully paid and non-assessable shares of Common Stock of the Corporation (as defined in Section 5(h) below) determined in accordance with the applicable conversion price provided in paragraph D(b5(b) below (the “Conversion Price”). All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred Stockbelow. (b) The Each share of Series AA Preferred Stock shall be converted into a number of shares of Common Stock issuable upon conversion of equal to 40.00, which is the Obligation Amount shall equal (i) the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component of the Obligation Amount, each share of Series AA Preferred Stock divided by a designated rate of $25 per share of Common Stock (ii) the "Conversion PriceStock"). The number of shares of Conversion Price Stock into which each share of the Series A AA Preferred Stock shall be $0.40converted shall be proportionately adjusted for any increase or decrease in the number of shares of Common Stock or Series AA Preferred Stock, subject to adjustment only as described hereinthe case may be, outstanding arising from any division or consolidation of shares, stock dividend, reverse stock split, or other similar increase or decrease in the number of shares of Common Stock or Series AA Preferred Stock, as the case may be, outstanding without receipt of consideration by the Corporation. Within five business days of the effective date of any conversion of a share of Series AA Preferred Stock into Common Stock, the Corporation shall pay the holder of such converted share of Series AA Preferred stock all accrued but unpaid dividends through the conversion date on such share. (ci) Holder will give notice The holder of its decision to exercise its right any certificate for shares of Series AA Preferred Stock desiring to convert any of such shares shall surrender such certificate, at the Series A Preferred Stockprincipal office of any transfer agent for said stock (the "Transfer Agent"), with a written notice (the "Notice of Conversion") of such election to convert such shares into Common Stock duly filled out and executed, and if necessary under the circumstances of such conversion, with such certificate properly endorsed for, or part thereof and/or accrued accompanied by duly executed instruments of, transfer (and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed such other transfer papers as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmissionsaid Transfer Agent may reasonably require). The Holder will not be required to surrender holder of the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation in accordance with the provisions hereof shares so surrendered for conversion shall be deemed a Conversion Date. The Corporation will itself, or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates representing the Common Stock issuable upon conversion of the Series A Preferred Stock entitled to the Holder via express courier for receipt by such Holder receive within three (3) business days after receipt by the Corporation of the Notice of Conversion (except as otherwise provided herein) a certificate or certificates, which shall be expressed to be fully paid and non-assessable, for the “Delivery Date”number of shares of Common Stock to which such stockholder shall be entitled upon such conversion, registered in the name of such holder or in such other name or names as such stockholder in writing may specify (provided, that the Corporation shall not be required to issue the Common Stock in any name other than the holder of the Series AA Preferred Stock unless an exemption from registration for the transfer of such shares is available under the Securities Act of 1933 and any applicable state securities laws). In the event case of any Series AA Preferred Stock which is converted in part only, the Common holder of shares of Series AA Preferred Stock is electronically transferable, then shall upon delivery of the certificate or certificates representing Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock also receive a new share certificate representing the balance unconverted portion of the shares of Series A AA Preferred Stock. Nothing herein shall be construed to give any holder of shares of Series AA Preferred Stock not so converted will be provided by surrendering the Corporation same for conversion the right to receive any additional shares of Common Stock or other property which results from an adjustment in conversion rights under the provisions of subparagraph (f) of this Section 5 until holders of Common Stock are entitled to receive the shares or other property giving rise to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holder. adjustment. (ii) In the case of the exercise of the conversion rights set forth in paragraph D(a) hereofSection 5(a), the conversion privilege shall be deemed to have been exercised exercised, and the shares of Common Stock issuable upon such conversion shall be deemed to have been issued issued, upon the date of receipt by the Corporation such Transfer Agent for conversion of the Notice certificate for such shares of ConversionSeries AA Preferred Stock. The person or entity entitled to receive Common Stock issuable upon such conversion shall, shall on the date such conversion privilege is deemed to have been exercised and thereafter, thereafter be treated for all purposes as the recordholder record holder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder holder of such shares of Series A AA Preferred Stock so converted. (iii) Notwithstanding the foregoing, if the stock transfer books are closed on the date such shares are received by the Transfer Agent, the conversion privilege shall be deemed to have been exercised, and the person or entity shall be treated as a record holder of shares of Common Stock, on the next succeeding date on which the transfer books are open. The Corporation shall not be required to deliver certificates for shares of its Common Stock or new certificates for unconverted shares of its Series AA Preferred Stock while the stock transfer books for such respective classes of stock are duly closed for any purpose, but the right of surrendering shares of Series AA Preferred Stock for conversion shall not be suspended during any period that the stock transfer books of either of such classes of stock are closed. (iv) Upon the conversion of any shares of Series A AA Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend thereafter on shares of such stock or on account of any dividend on the Common Stock, except that the Holder holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. . (v) If the Corporation shall at any time be liquidated, dissolved or wound-up, the conversion privilege shall terminate at the close of business on the last business day next preceding the effective date of such liquidation, dissolution or winding up. (vi) The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A AA Preferred Stock, to issue a fractional shares of its common Stock nor to deliver any stock certificate representing a fraction thereof, but in lieu thereof the Corporation may make a cash payment equal to such fraction multiplied by $25.00. (i) In case of any consolidation or merger of the Corporation with or into any other corporation (other than a merger or consolidation in which the Corporation is the surviving or continuing corporation and which does not result in any reclassification, conversion or change of the outstanding shares of Common Stock), then lawful provision shall be made so that holders of Series AA Preferred Stock shall thereafter have the right to convert each share of its Series A AA Preferred Stock into the kind and amount of shares of stock and/or other securities or property receivable upon such consolidation or merger by a holder of the number of shares of Common Stock into which such shares of Series AA Preferred Stock might have been converted immediately before such consolidation or merger. The foregoing provisions of this Section 5(d) shall similarly apply to successive consolidations and mergers. (ii) In case of any sale or conveyance to another person or entity of the property of the Corporation as an entirety, or substantially as an entirety, in connection with which shares or other securities or cash or other property shall be issuable, distributable, payable or deliverable for outstanding shares of Common Stock, then, unless the right to convert such shares shall have terminated, lawful provision shall be made so that the holders of Series AA Preferred Stock shall thereafter have the right to convert each share of the Series AA Preferred Stock into the kind and amount of shares of stock or other securities or cash or property that shall be issuable, distributable, payable or deliverable upon such sale or conveyance with respect to each share of Common Stock immediately before such conveyance. (iii) In case of any issuance of Equity Securities of the Corporation after the date hereof (other than (a) issuances to employees of the Company or any of its subsidiaries in connection with such person's employment arrangements, (b) registered public offerings, (c) issuances directly related to any business combination, recapitalization or acquisition transaction involving the Company or any of its subsidiaries and (d) issuances directly related to any joint venture, strategic partnership or alliance, in each case to the extent approved by the Board) at a purchase price (including any implied purchase price based upon conversion into Common Stock) less than the applicable conversion price of the Series AA Preferred Stock, the number of shares of Conversion Stock into which each share of Series AA Preferred Stock may be converted shall be adjusted downward to a conversion price calculated by multiplying the conversion price immediately prior to such issuance by a fraction, the numerator of which equals the sum of (i) the conversion price prior to such issuance multiplied by the number of shares of Common Stock of the Corporation that are outstanding immediately prior to such issuance (on a fully diluted basis) plus (ii) the aggregate consideration received (or receivable upon conversion into Common Stock) by the Corporation with respect to such issuance and the denominator of which equals (x) the number of shares of Common Stock of the Corporation that are outstanding immediately after such issuance (on a fully diluted basis) multiplied by the conversion price of the Series AA Preferred immediate prior to such issuance. (e) Whenever the number of shares to be issued upon conversion of the Series AA Preferred Stock is required to be adjusted as provided in this Section 5, the Corporation shall forthwith compute the adjusted number of shares to be so issued and prepare a certificate setting forth such adjusted conversion amount and the facts upon which such adjustment is based, and such certificate shall be forthwith be filed with the Transfer Agent for the Series AA Preferred Stock and the Common Stock; and the Corporation shall mail to each holder of record of Series AA Preferred Stock notice of such adjusted conversion price. (f) In case at any time the Corporation shall propose: (i) to pay any dividend or distribution payable in shares upon its Common Stock or make any distribution (other than cash dividends) to the holders of its Common Stock, Class A Convertible Preferred Stock, Series B Convertible Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, or Series E Preferred Stock, other than in accordance with the terms hereof; or (ii) to offer for subscription to the holders of its Common Stock, Class A Convertible Preferred Stock, Series B Convertible Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, or Series E Preferred Stock, or other than in accordance with the terms thereof, any additional shares of any class or any other rights; or (iii) any capital reorganization or reclassification of its shares, or the consolidation or merger of the Corporation with another corporation; or (iv) the voluntary dissolution, liquidation or winding-up of the Corporation; then, and in any one or more of said cases, the Corporation shall cause at least fifteen (15) days prior notice of the date on which (A) the books of the Corporation shall close, or a record be taken for such stock dividend, distribution or subscription rights, or (B) such capital reorganization, reclassification, consolidation, merger, dissolution, liquidation or winding-up shall take place, as the case may be, to be mailed to the Transfer Agent for the Series AA Preferred Stock and for the Common Stock and to the holders of record of the Series AA Preferred Stock. (g) So long as any shares of Series AA Preferred Stock shall instead deliver remain outstanding and the holders thereof shall have the right to convert the same in accordance with provisions of this Section 5, the Corporation shall at all times reserve from the authorized and unissued shares of its Common Stock a stock certificate representing the next higher whole numbersufficient number of shares to provide for such conversions.

Conversion into Common Stock. Holders (a) At any time while this Note is outstanding, the Lender shall have the right, at its option, to convert all or a part of the outstanding Loan into that number of shares of Series A Preferred Stock shall have the following conversion rights and obligations: Borrower’s common stock, par value $0.001 per share (a) Subject “Common Stock”), equal to the further provisions result of this paragraph D(a)dividing the Loan, each Holder of Series A Preferred Stock shall have the right at any time commencing after the issuance to such Holder of Series A Preferred Stock, to convert such shares, accrued but unpaid declared dividends on the Series A Preferred Stock and any other sum owed accrued and unpaid Interest thereon, by $0.25, as may be adjusted for stock splits, stock dividends, subdivisions or combinations of, or similar transactions in, the Corporation arising from the Series A Preferred Stock or pursuant to the Subscription Agreement entered into by the Corporation and the Holder or Holder’s predecessor in connection with the issuance of Series A Preferred Stock (each a “Subscription Agreement”) (collectively “Obligation Amount”) into fully paid and non-assessable shares of Common Stock of the Corporation determined in accordance with the applicable conversion price provided in paragraph D(b) below (the “Conversion PriceShares”). All declared or accrued but unpaid dividends may be converted at the election of the Holder together with or independent of the conversion of the Series A Stated Value of the Series A Preferred Stock. (b) The Loan due hereunder shall automatically be reduced by the amount of Loan that has previously been converted pursuant to Section 2(b) hereof. (c) In order to exercise its voluntary conversion rights pursuant to Section 2 hereof, the Lender shall deliver a written notice of election to convert sent by email, overnight courier or registered mail in the form of which is attached hereto as Annex A (each, a "Conversion Notice") setting forth the amount of Loan the Lender is electing to convert, duly completed and signed, to the Borrower. Each conversion shall be deemed to have been effected immediately prior to the close of business on the first business day following the date that the Conversion Notice is sent to the Borrower (the “Conversion Date”), and the Lender shall be deemed to have become the holder of record of the shares of Common Stock at such time and on such date. (d) As promptly as practicable after delivery by the Lender of the Conversion Notice and in any event within five (5) business days after such delivery, the Borrower shall issue and deliver to the Lender a certificate or certificates for the number of full shares of Common Stock representing the Conversion Shares. In the event that less than the total Loan remaining under this Note is converted pursuant to Section 2 hereof, the Borrower shall, simultaneously with the issuance of certificates for the shares of Common Stock issuable upon conversion of all or part of this Note, cause the Obligation Amount shall equal Borrower to issue and deliver to the Lender (i) or in accordance with the sum of (A) the Series A Stated Value being converted and/or (B) at the Holder’s election, accrued and unpaid dividends or any other component instructions of the Obligation Amount, divided by (iiLender) a new Note for the Conversion Price. The Conversion Price balance of the Series A Preferred Loan not so converted. All shares of Common Stock shall be $0.40, subject to adjustment only as described herein. (c) Holder will give notice delivered upon conversion of its decision to exercise its right to convert the Series A Preferred Stock, all or part thereof and/or accrued and unpaid dividends, by sending by facsimile an executed and completed Notice of Conversion (a form of which is annexed as Exhibit A to this Certificate of Designation) to the Corporation via confirmed facsimile transmission. The Holder Note will not be required to surrender the Series A Preferred Stock certificate until the Series A Preferred Stock has been fully converted. Each date on which a Notice of Conversion is sent by facsimile to the Corporation upon delivery in accordance with the provisions hereof shall be deemed a Conversion Date. The Corporation will itselfduly and validly issued and fully paid and non-assessable, free of all liens and charges and not subject to any preemptive rights. (e) No fractional shares or cause the Corporation’s transfer agent to, transmit the Corporation’s Common Stock certificates securities representing the Common Stock issuable upon conversion of the Series A Preferred Stock to the Holder via express courier for receipt by such Holder within three (3) business days after receipt by the Corporation of the Notice of Conversion (the “Delivery Date”). In the event the Common Stock is electronically transferable, then delivery of the Common Stock must be made by electronic transfer, provided request for such electronic transfer has been made by the Holder. A Series A Preferred Stock certificate representing the balance of the Series A Preferred Stock not so converted will be provided by the Corporation to the Holder if requested by Holder, provided the Holder has delivered the original Series A Preferred Stock certificate to the Corporation. To the extent that a Holder elects not to surrender the certificate for such Series A Preferred Stock for reissuance upon partial payment or conversion, the Holder hereby indemnifies the Corporation against any and all loss or damage attributable to a third-party claim in an amount in excess of the actual amount of the Series A Stated Value then owned by the Holder. In the case of the exercise of the conversion rights set forth in paragraph D(a) hereof, the conversion privilege shall be deemed to have been exercised and the fractional shares of Common Stock issuable upon such conversion shall be deemed to have been issued upon conversion of all or part of this Note. Any fractional interest in a share of Common Stock resulting from conversion of all or part of this Note shall be paid in cash (computed to the nearest cent) equal to such fraction multiplied by $0.25 on the date of receipt by the Corporation of the Notice of Conversion. The person or entity entitled to receive Common Stock issuable upon such conversion shall, on the date and thereafter, be treated for all purposes as the recordholder of such Common Stock and shall on the same date cease to be treated for any purpose as the record Holder of such shares of Series A Preferred Stock so converted. Upon the conversion of any shares of Series A Preferred Stock, no adjustment or payment shall be made with respect to such converted shares on account of any dividend on the Common Stock, except that the Holder of such converted shares shall be entitled to be paid any dividends declared on shares of Common Stock after conversion thereof. The Corporation shall not be required, in connection with any conversion of the Series A Preferred Stock and payment of dividends on Series A Preferred Stock, to issue a fraction of a share of its Series A Preferred Stock or Common Stock and shall instead deliver a stock certificate representing the next higher whole numberconversion.