Common use of Conversion Rights Clause in Contracts

Conversion Rights. At any time prior to the Maturity Date, at the option of Holder in its sole discretion, all or any portion of the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Common Stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount at a price of $.005 per share. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Shares.

Conversion Rights. At any time on or prior to the Maturity Date, at the option of Holder Obligor in its sole discretion, all or any portion of the then outstanding Principal Amount and accrued but unpaid interest of this Convertible Note may be converted (an the "Optional Conversion") into a number of Common Stock shares of Obligor’s common stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount at a price of plus the then accrued but unpaid interest to be converted, divided by the Conversion Price (herein so called) which shall be $.005 1.00 per shareOptional Conversion Share. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice to Holder of such exercise, substantially in the form of Exhibit A attached hereto (the "Optional Conversion Notice"), to Obligor ) and Holder shall surrender this Note within 5 business days of the date of the Optional Conversion Notice at such officethe principal office of Obligor. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such which time such portion of the Principal Amount and accrued but unpaid interest as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount and accrued but unpaid interest converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Shares.

Conversion Rights. At any time prior to the Maturity Date, at the sole option of the Holder except in its sole discretionthe event of the closing price threshold noted below, all or any portion but not less than all, of the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Common Stock shares of Obligor’s common stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount to be converted divided by the Conversion Price (herein so called) which price shall be $1.50 (one dollar and fifty cents) per Optional Conversion Share. If the Obligor’s common stock has traded at $1.50 or above for 4 consecutive weeks on a price nationally recognized market (based on daily closing prices), then any Optional Conversion under this Section 8 may also occur at the option of $.005 per sharethe Obligor. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto exercise (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 78, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Shares.

Conversion Rights. At Payee shall be entitled, at any time prior and from time to time and in its sole discretion, to convert all or a portion of the Maturity Dateprincipal amount and accrued interest due under this Note into shares of the Maker's Series C 8% Convertible Preferred Stock, $.01 par value, Stated Value $1,000 per share (the "PREFERRED STOCK") or, at the option of Holder in its sole discretionPayee, all or any portion of into the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Maker's Common Stock (the "Optional Conversion SharesCOMMON STOCK"). Any such conversion into Preferred Stock shall be effected at the rate of one share of Preferred Stock for each $1,000 due hereunder which Payee has elected to convexx (the "CONVERSION RATE"). If Payee elects to convert all or a portion of the principal amount and accrued interest due under this Note directly into the Common Stock, the number of shares to be issued shall be calculated as if such amount had first been converted to Preferred Stock hereunder (calculated without regard to any insufficiency of authorized shares of Preferred Stock) and such resulting shares of Preferred Stock had, in turn, immediately been converted to Common Stock at a conversion price per share equal to the amount lowest of (a) $1.50, (b) 66.67% of the then outstanding Principal Amount Average Price (as hereafter defined), (c) the price per share at a price which the Maker, after the date of $.005 per share. In order to exercise this Allonge, issues and sells any Common Stock, or (d) where coupled with the right of Optional Conversionthe purchaser(s) thereof to demand that the Corporation register under the Securities Act of 1933 any Common Shares (not theretofore registered) for which any warrants or options may be exercised or any convertible, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall exchangeable or exercisable securities may be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicableexercised or exchanged, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional exercise price of any such warrants or options issued by the Maker after the date of this Allonge, or (ii) the conversion rate, exchange rate or exercise price, respectively, of any such convertible, exchangeable or exercisable security issued by the Maker after the date of this Allonge, except for stock option agreements or stock incentive agreements issued pursuant to employee benefit plans. For purposes of this Paragraph 16, the term "Average Price" per share of Common Stock means the average of the closing bid prices as reported on the Nasdaq Stock Market (or if not then traded on such market, on such exchange or quotation system where such shares are then traded) for the lowest five of the twenty trading days immediately preceding the Conversion Notice presented Date. Payee may elect to convert by Holder delivering to ObligorMaker, and any by facsimile, telecopier or other documents necessary for such Optional Conversion expedient means of transmission, a notice of conversion stating (i) the principal amount and/or accrued interest to be effected, to be filed as necessary and appropriate under the laws of the state of Nevadaconverted, (ii) Holder's name the number of shares of Preferred Stock or Common Stock to be entered in the register issued as a result of the members of Obligor in respect of the Optional Conversion Shares, such conversion; and (iii) the person(s) in whose name the Preferred Stock or Common Stock is to be delivered issued. The conversion of any portion of this Note and the resulting issuance of Preferred Stock or Common Stock shall be effective upon the date that Maker receives the corresponding notice of conversion, and Maker shall deliver to Holder Payee one or more certificates evidencing such shares no later than five days following such effective date. Upon a convertible noteconversion of all amounts due hereunder, in form Payee shall deliver the orxxxxxl Note (including all Allonges), marked "PAID," to Maker no later than five days following the delivery to Maker of the conversion notice. In the event of a conversion of less than all amounts due hereunder, (A) no principal amount under the Note shall be deemed converted unless and substance identical to this Convertible Note, for until all accrued interest under the remaining outstanding Principal Amount if such Optional Conversion was not for Note shall be first converted; and (B) the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion amounts due hereunder that are so converted shall be deemed repaid. The parties shall mark on the grid attached to have occurred unless the Fourth Allonge to Secured Promissory Note dated May 10, 1999 the facts related to such partial conversion and until Obligor shall have complied with confirm the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as accuracy of the date the Optional Conversion Notice is given entry by signing next to Obligor; provided, however, that no failure by Obligor to so comply with each such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Sharesentry.

Conversion Rights. At Provided no Event of Default specified in clause (v) of Section 8 has occurred and is continuing (and without giving effect to any time grace period specified therein), the Borrower may elect to satisfy, in whole or in part, the Principal Amount outstanding and accrued but unpaid interest on the Initial Maturity Date by issuing common shares in the capital of the Borrower (“HWDC Shares”). Each HWDC Share so issued will for these purposes be valued based on the 5 day volume-weighted average trading price of the HWDC Shares on the Toronto Stock Exchange (the “TSX”) prior to (but not including) the Initial Maturity DateDate less a discount of 10 %, at and the option amount satisfied through such issuance shall be calculated by multiplying the total number of Holder in its sole discretion, all or any portion HWDC Shares so issued by such discounted 5 day volume-weighted average trading price. The Borrower shall only be permitted to issue HWDC Shares to the Lender to satisfy repayment of the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Common Stock (the "Optional Conversion Shares") equal outstanding and accrued but unpaid interest pursuant to the amount foregoing paragraph if HWDC Shares have been and are listed and posted for trading on TSX continuously from the date hereof to and including the Initial Maturity Date and shall only be permitted to issue HWDC Shares to (and up to) the extent that such issuance does not result in the Lender holding greater than 19.9% of the then issued and outstanding Principal Amount at a price of $.005 per shareHWDC Shares immediately following such issuance. In order the event that the Borrower elects to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such satisfy a portion of the Principal Amount as is subject outstanding and accrued but unpaid interest pursuant to such Optional Conversion shall be applied by Obligor the foregoing paragraphs in full payment of HWDC Shares and notifies the Optional Conversion Shares Lender that based on its current cash balances, it has determined in good faith not to be issued in consequence of repay the Conversion and that application shall discharge Obligor from all liability in respect of such portion balance of the Principal Amount converted, outstanding and Holder shall be deemed for all purposes to have become accrued but unpaid interest on the holder of the Optional Conversion Shares. As promptly as practicableInitial Maturity Date, but in no event later than seven (7) Business Daysto extend the Maturity Date, after an Optional Conversion, Obligor, at its expense, the Maturity Date shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary automatically be extended for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws a period of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Shares180 days.

Conversion Rights. At any time prior to the Maturity Date, at the sole option of the Holder except in its sole discretionthe event of the closing price threshold noted below, all or any portion but not less than all, of the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Common Stock shares of Obligor’s common stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount at a to be converted divided by the Conversion Price (herein so called) which price of shall be $.005 1.00 (one dollar and zero cents) per shareOptional Conversion Share. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto exercise (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 78, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Shares.

Conversion Rights. At (i) A holder of shares of Preferred Stock may convert such shares into Common Stock at any time prior to the Maturity Datetime, unless previously redeemed, at the option of Holder the holder thereof. For the purposes of conversion, each share of Preferred Stock shall be valued at the Liquidation Preference, which shall be divided by the Conversion Price in its sole discretion, all or any portion of effect on the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a Conversion Date to determine the number of Common Stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount at a price of $.005 per share. In order to exercise shares issuable upon conversion, except that the right to convert shares of Optional Conversion, Holder Preferred Stock called for redemption shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected terminate at the close of business on the date on which such Optional Conversion Notice, duly completed Business Day preceding the Redemption Date and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor lost if not exercised prior to that time, unless the Company shall default in full payment of the Optional Conversion Shares to be issued in consequence Redemption Price. Immediately following such conversion, the rights of the Conversion holders of converted Preferred Stock shall cease and that application shall discharge Obligor from all liability in respect the persons entitled to receive the Common Stock upon the conversion of such portion of the Principal Amount converted, and Holder Preferred Stock shall be deemed treated for all purposes to have as having become the holder owners of the Optional Conversion Sharessuch Common Stock. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name To convert Preferred Stock, a holder must (A) surrender the certificate or certificates evidencing the shares of Preferred Stock to be entered converted, duly endorsed in a form satisfactory to the register Company, at the office of the members Company or Transfer Agent for the Preferred Stock, (B) notify the Company at such office that he elects to convert Preferred Stock and the number of Obligor shares he wishes to convert, (C) state in respect writing the name or names in which he wishes the certificate or certificates for shares of the Optional Conversion SharesCommon Stock to be issued, and (iiiD) pay any transfer or similar tax if required. In the event that a holder fails to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for notify the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion Company of the then outstanding Principal Amount. Notwithstanding any provision number of this Convertible Note shares of Preferred Stock which he wishes to the contraryconvert, no Optional Conversion he shall be deemed to have occurred unless elected to convert all shares represented by the certificate or certificates surrendered for conversion. The date on which the holder satisfies all those requirements is the "Conversion Date." As soon as practical, the Company shall deliver a certificate for the number of full shares of Common Stock issuable upon the conversion, and until Obligor shall have complied with a new certificate representing the obligations set forth unconverted portion, if any, of the shares of Preferred Stock represented by the certificate or certificates surrendered for conversion. The person in whose name the immediately preceding sentence, whereupon such Optional Conversion Common Stock certificate is registered shall be deemed treated as the stockholder of record on and after the Conversion Date. No payment or adjustment will be made for accrued and unpaid dividends on converted shares of Preferred Stock or for dividends on any Common Stock issued upon such conversion. The holder of record of a share of Preferred Stock at the close of business on a Record Date with respect to have been effective as the payment of dividends on the Preferred Stock will be entitled to receive such dividends with respect to such share of Preferred Stock on the corresponding Dividend Payment Date, notwithstanding the conversion of such share after such Record Date and prior to such Dividend Payment Date. A share of Preferred Stock surrendered for conversion during the period from the close of business on any Record Date for the payment of dividends to the opening of business of the corresponding Dividend Payment Date must be accompanied by a payment in cash, Common Stock or a combination thereof, depending on the method of payment that the Company has chosen to pay the dividend, in an amount equal to the dividend payable on such Dividend Payment Date, unless such share of Preferred Stock has been called for redemption on a Redemption Date occurring during the period from the close of business on any Record Date for the payment of dividends to the close of business on the Business Day immediately following the corresponding Dividend Payment Date. The dividend payment with respect to a share of Preferred Stock called for redemption on a date during the Optional Conversion Notice is given period from the close of business on any Record Date for the payment of dividends to Obligor; providedthe close of business on the Business Day immediately following the corresponding Dividend Payment Date will be payable on such Dividend Payment Date to the record holder of such share on such Record Date, howevernotwithstanding the conversion of such share after such Record Date and prior to such Dividend Payment Date, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as and the holder converting such share of Preferred Stock need not include a payment of such dividend amount upon surrender of such share of Preferred Stock for conversion. No payment or adjustment will be made upon conversion of shares of Preferred Stock for accumulated and unpaid dividends or for dividends with respect to the Optional Conversion SharesCommon Stock issued upon such conversion. If a holder of Preferred Stock converts more than one share at a time, the number of full shares of Common Stock issuable upon conversion shall be based on the total liquidation preferences of all shares of Preferred Stock converted. If the last day on which Preferred Stock may be converted is not a Business Day, Preferred Stock may be surrendered for conversion on the next succeeding Business Day.

Conversion Rights. At any time prior The Borrower hereby irrevocably grants to the Maturity Date, at Lender the option of Holder and right, exercisable from time to time in its the Lender’s sole discretiondiscretion during the Conversion Period, and upon three (3) Business Days prior written notice to the Borrower (the “Conversion Notice”) to convert all or any portion of the then Loan and Commitment, together with any outstanding Principal Amount interest thereon, into Conversion Shares at the Conversion Price (the “Conversion Rights”) whereupon the relevant portion of this Convertible Note may the Loan shall be deemed permanently repaid upon issuance of the Conversion Shares to the Lender. The Conversion Notice shall specify (i) the principal amount of the Loan or Commitment to be converted into Conversion Shares (an "Optional Conversion"the “Conversion Amount”); (ii) into a the accrued and unpaid interest due on the Conversion Amount; (iii) the effective date for the conversion and delivery of Conversion Shares to the Lender (the “Conversion Date”); (iv) the Conversion Price; and (v) the number of Common Stock Conversion Shares to be issued by the Borrower in satisfaction of such conversion. The number of Conversion Shares to be issued by the Borrower to the Lender shall be determined by the Lender by calculating (x) the "Optional sum of (A) the Conversion Shares"Amount plus (B) equal to the amount of accrued and unpaid interest on the then outstanding Principal Amount at a price of $.005 per shareConversion Amount, divided by (B) the Conversion Price. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially The Lender may also specify in the form Conversion Notice the denominations and number of Exhibit A attached hereto (certificates for the "Optional Conversion Notice")Shares to be issued by the Borrower in connection with such conversion, the name in which such certificates should be titled and issued and delivery instructions with respect thereto. Each Conversion Notice will be irrevocable when it is effective under the notice provisions of this Agreement. The Borrower shall promptly issue and deliver to Obligor at such office. Such Optional the Lender the applicable number of Conversion shall Shares, and the Conversion Amount will be deemed to have been effected at repaid by the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect Borrower upon irrevocable delivery of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, issued in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion name of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising Lender (or its rights as the holder of the Optional Conversion Sharesdesignee).

Conversion Rights. At any time prior to the Maturity Date, at the sole option of Holder in its sole discretionthe Holder, all or any portion but not less than all of the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Common Stock shares of Obligor’s common stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount at a price of to be converted divided by the Conversion Price (herein so called) which shall be $.005 1.00 (one dollar) per shareOptional Conversion Share. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto exercise (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 78, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Shares.

Conversion Rights. At any time prior to the Maturity Date, at the option of Holder in its sole discretion, all or any portion of the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Common Stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount at a price of $.005 per share. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of NevadaCalifornia, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising its rights as the holder of the Optional Conversion Shares.

Conversion Rights. At any time prior The Borrower hereby irrevocably grants to the Maturity Date, at Lender the option of Holder and right, exercisable from time to time in its the Lender’s sole discretiondiscretion during the Conversion Period, and upon three (3) Business Days prior written notice to the Borrower (the “Conversion Notice”) to convert all or any portion of the then Loan, together with any outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") interest thereon, into a number of Common Stock Conversion Shares at the Conversion Price (the "Optional “Conversion Shares"Rights”) equal whereupon the relevant portion of the Loan shall be deemed permanently repaid upon issuance of the Conversion Shares to the amount of the then outstanding Principal Amount at a price of $.005 per shareLender. In order to exercise the right of Optional Conversion, Holder The Conversion Notice shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially be in the form of Exhibit A attached hereto Attachment I to Schedule 9 and shall specify (i) the principal amount of the Loan to be converted into Conversion Shares (the "Optional “Conversion Notice"Amount”); (ii) the accrued and unpaid interest due on the Conversion Amount; (iii) the effective date for the conversion and delivery of Conversion Shares to the Lender (the “Conversion Date”); (iv) the Conversion Price; and (v) the number of Conversion Shares to be issued by the Borrower in satisfaction of such conversion. The number of Conversion Shares to be issued by the Borrower to the Lender shall be determined by the Lender by calculating (x) the sum of (A) the Conversion Amount plus (B) the amount of accrued and unpaid interest on the Conversion Amount, divided by (B) the Conversion Price. The Lender may also specify in the Conversion Notice the denominations and number of certificates for the Conversion Shares to Obligor at be issued by the Borrower in connection with such officeconversion, the name in which such certificates should be titled and issued and delivery instructions with respect thereto. Such Optional Each Conversion Notice will be irrevocable when it is effective under the notice provisions of this Agreement. The Borrower shall promptly issue and deliver to the Lender the applicable number of Conversion Shares, and the Conversion Amount will be deemed to have been effected at repaid by the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect Borrower upon irrevocable delivery of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Shares. As promptly as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, issued in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion name of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding sentence, whereupon such Optional Conversion shall be deemed to have been effective as of the date the Optional Conversion Notice is given to Obligor; provided, however, that no failure by Obligor to so comply with such obligations shall prohibit Holder from exercising Lender (or its rights as the holder of the Optional Conversion Sharesdesignee).

Conversion Rights. At (i) After approval or ratification by the shareholders of the Company of the rights contained in this Section 5(c), to the extent required by NASD Rule, a holder of shares of Preferred Stock may convert such shares into Common Stock at any time prior to on or before the Maturity Date, third anniversary of the Preferred Stock Issue Date at the option of Holder in its sole discretion, all or any portion of the then outstanding Principal Amount of this Convertible Note may be converted (an "Optional Conversion") into a number of Common Stock (the "Optional Conversion Shares") equal to the amount of the then outstanding Principal Amount at a price of $.005 per share. In order to exercise the right of Optional Conversion, Holder shall surrender this Convertible Note at the principal office of Obligor and shall give written notice of such exercise, substantially in the form of Exhibit A attached hereto (the "Optional Conversion Notice"), to Obligor at such office. Such Optional Conversion shall be deemed to have been effected at the close of business on the date on which such Optional Conversion Notice, duly completed and executed, shall have been given as aforesaid, and, subject to the last sentence of this Section 7, at such time such portion of the Principal Amount as is subject to such Optional Conversion shall be applied by Obligor in full payment of the Optional Conversion Shares to be issued in consequence of the Conversion and that application shall discharge Obligor from all liability in respect of such portion of the Principal Amount converted, and Holder shall be deemed for all purposes to have become the holder of the Optional Conversion Sharesthereof. As promptly Except as practicable, but in no event later than seven (7) Business Days, after an Optional Conversion, Obligor, at its expense, shall cause (i) the Optional Conversion Notice presented by Holder to Obligor, and any other documents necessary for such Optional Conversion to be effected, to be filed as necessary and appropriate under the laws of the state of Nevada, (ii) Holder's name to be entered in the register of the members of Obligor in respect of the Optional Conversion Shares, and (iii) to be delivered to Holder a convertible note, in form and substance identical to this Convertible Note, for the remaining outstanding Principal Amount if such Optional Conversion was not for the entire portion of the then outstanding Principal Amount. Notwithstanding any provision of this Convertible Note to the contrary, no Optional Conversion shall be deemed to have occurred unless and until Obligor shall have complied with the obligations set forth in the immediately preceding next sentence, whereupon such Optional Conversion for the purposes of conversion, each share of Preferred Stock shall be deemed valued at the Liquidation Preference which shall be divided by the Conversion Price in effect on the Conversion Date (defined below) to determine the number of shares issuable upon conversion. If a holder of shares of Preferred Stock gives written notice (a "Dividend Conversion Notice") to the Corporation at least two Business Days but not more than 60 days prior to giving a notice of conversion pursuant to Section 5(c)(ii)(B) that it will be electing to convert a specified number of shares of Preferred Stock and that it elects to have been effective any Accrued Dividends thereon that are payable prior to the Conversion Date but remain unpaid as of the date Conversion Date converted into Common Stock on the Optional Conversion Notice is given Date (thereby affording the Corporation the opportunity to Obligor; providedpay such Accrued Dividends in cash prior to the Conversion Date so that they will not be converted into Common Stock), howeverthen for the purposes of conversion, each share of Preferred Stock shall be valued at the Liquidation Preference plus the amount of Accrued Dividends thereon that no failure by Obligor are payable prior to so comply with such obligations shall prohibit Holder from exercising its rights the Conversion Date but remain unpaid as the holder of the Optional Conversion SharesDate, if any, which shall be divided by the Conversion Price in effect on the Conversion Date to determine the number of shares issuable upon conversion. Immediately following any such conversion, the rights of the holders of converted Preferred Stock shall cease and the persons entitled to receive the Common Stock upon the conversion of Preferred Stock shall be treated for all purposes as having become the owners of such Common Stock.