NOTE

– WARRANTS AND REGISTRATION RIGHTS AGREEMENTS

The following table presents a summary of the status of our issued warrants as of

June 30, 2019,

and changes during the

six

months then ended:

	Shares Underlying Warrants			Weighted Average Exercise Price

Outstanding, December 31, 2018		20,140,731		$	0.15
Granted		500,000			0.76
Canceled / Expired		(500,000	)		0.76
Exercised		-			-

Outstanding, June 30, 2019		20,140,731		$	0.15

Warrants Issued

Midcap Warrant

In connection with the line of credit agreement with MidCap described in Note

we issued MidCap a warrant, exercisable through

January 22, 2018,

for an aggregate of

500,000

shares of the Company’s common stock at an exercise price of

$0.76

per share (the “MidCap Warrant

1”

). We entered into a registration rights agreement with Midcap, dated as of

January 22, 2015,

granting MidCap certain registration rights, commencing

October 1, 2015,

for the shares of common stock issuable on exercise of the MidCap Warrant

The MidCap Warrant

was

not

exercised and expired on

January 22, 2018.

The agreement is amended from time to time and wherein it was necessary under the terms of the agreement to obtain MidCap's consent to the transactions contemplated by the above mentioned GH Notes and Golisano LLC Notes; on

February 6, 2018,

MidCap agreed to consent to the transactions contemplated in exchange for a warrant to MidCap exercisable for up to

500,000

shares of the Company’s common stock at an exercise price of

$0.76

per share (“MidCap Warrant

2”

). The Company has reserved

500,000

shares of the Company’s common stock for issuance under MidCap Warrant

The MidCap Warrant

expired, unexercised on

February 6, 2019.

April 22, 2019

subsequent to entering into the MidCap Seventeenth Amendment as noted in note

the Company issued a warrant to MidCap exercisable for up to

500,000

shares of Company common stock at an exercise price of

$0.76

per share (the "MidCap Warrant

3”

). The Company has reserved

500,000

shares of Company common stock for issuance under the MidCap Warrant

The MidCap Warrant

if exercisable, expires on

April 22, 2021.

Penta Warrants

Pursuant to a stock purchase agreement dated

June 30, 2015,

a warrant was issued to Penta to purchase an aggregate

807,018

shares of our common stock at a price of

$0.01

per share at any time prior to the close of business on

June 30, 2020.

We granted Penta certain registration rights, commencing

October 1, 2015,

for the shares of common stock issuable upon exercise of the warrant.

JL Warrants

Pursuant to a

June 30, 2015

stock purchase agreement, a warrant was issued to JL to purchase an aggregate

403,509

shares of the Company’s common stock at a price of

$0.01

per share at any time prior to the close of business on

June 30, 2020,

subject to certain adjustments. We granted JL certain registration rights, commencing

October 1, 2015,

for the shares of common stock issuable upon exercise of the warrant. The warrant was subsequently assigned by JL to

two

individuals.

JL Properties, Inc. Warrants

April 2015,

we entered into an office lease agreement which requires a

$1,000

security deposit, subject to reduction if we achieve certain market capitalization metrics at certain dates. On

April 30, 2015,

we entered into a reimbursement agreement with JL Properties, Inc. (“JL Properties”) pursuant to which JL Properties agreed to arrange for and provide an unconditional, irrevocable, transferable, and negotiable commercial letter of credit to serve as the security deposit. As partial consideration for the entry by JL Properties into the reimbursement agreement and the provision of the letter of credit, we issued JL Properties

two

warrants to purchase shares of the Company’s common stock.

The

first

warrant is exercisable for an aggregate of

465,880

shares of common stock, subject to certain adjustments, at an aggregate purchase price of

$0.01,

at any time prior to

April 30, 2020.

In addition to adjustments on terms and conditions customary for a transaction of this nature in the event of (i) reorganization, recapitalization, stock split-up, combination of shares, mergers, consolidations and (ii) sale of all or substantially all of our assets or property, the number of shares of common stock issuable pursuant to the warrant will be increased in the event our consolidated adjusted EBITDA (as defined in the warrant agreement) for the fiscal year ended

December 31, 2018

does

not

equal or exceed

$19,250.

JL Properties subsequently assigned the warrant to

two

individuals.

December 31, 2018,

our adjusted EBIDTA yielded a negative calculation; therefore, the warrant will

not

increase in shares.

The

second

warrant is exercisable for an aggregate of

86,962

shares of common stock, at a per share purchase price of

$1.00,

at any time prior to

April 30, 2020.

The number of shares issuable upon exercise of the

second

warrant is subject to adjustment on terms and conditions customary for a transaction of this nature in the event of (i) reorganization, recapitalization, stock split-up, combination of shares, mergers, consolidations and (ii) sale of all or substantially all of our assets or property.

We have granted JL Properties certain registration rights, commencing

October 1, 2015,

for the shares of common stock issuable on exercise of the

two

warrants. JL Properties has transferred these rights to

two

individuals.

Golisano LLC Warrants (formerly Penta Warrants)

In connection with the

November 13, 2014

note for

$8,000

(see Note

), Penta was issued a warrant to acquire

4,960,740

shares of the Company’s common stock at an aggregate exercise price of

$0.01,

through

November 13, 2019.

In connection with Penta’s consent to the terms of additional debt obtained by us, we also granted Penta a warrant to acquire

869,618

shares of common stock at a purchase price of

$1.00

per share, through

November 13, 2019.

Both warrant agreements grant Penta certain registration rights, commencing

October 1, 2015,

for the shares of common stock issuable on exercise of the warrants. Penta has the right, under certain circumstances, to require us to purchase all or any portion of the equity interest in the Company issued or represented by the warrant to acquire

4,960,740

shares at a price based on the greater of (i) the product of (

)

ten

times our adjusted EBITDA with respect to the

twelve

months preceding the exercise of the put right times (y) the investor’s percentage ownership in the Company assuming full exercise of the warrant; or (ii) the fair market value of the investor’s equity interest underlying the warrant. In the event (i) we do

not

have the funds available to repurchase the equity interest under the warrant or (ii) such repurchase is

not

lawful, adjustments to the principal of the note purchased by Penta will be made or, under certain circumstances, interest will be charged on the amount otherwise due for such repurchase. We have the right, under certain circumstances, to require Penta to sell to us all or any portion of the equity interest issued or represented by the warrant to acquire

4,960,740

shares. The price for such repurchase will be the greater of (i) the product of (

)

eleven

times our adjusted EBITDA with respect to the

twelve

months preceding the exercise of the call right times (y) the investor’s percentage ownership in the company assuming full exercise of the warrant; or (ii) the fair market value of the equity interests underlying the warrant; or (iii)

$3,750.

In connection with Golisano LLC’s acquisition of the note payable from Penta on

March 8, 2017 (

see Note

above for additional information), these warrants were assigned to Golisano LLC.

Golisano LLC Warrants (formerly JL Warrants)

In connection with the

January 22, 2015

note payable to JL-BBNC Mezz Utah, LLC (“JL”), we issued JL warrants to purchase an aggregate of

2,329,400

shares of the Company’s common stock, at an aggregate exercise price of

$0.01,

through

February 13, 2020.

February 4, 2015,

we also granted to JL a warrant to acquire a total of

434,809

shares of common stock at a purchase price of

$1.00

per share, through

February 13, 2020.

Both warrant agreements grant JL certain registration rights, commencing

October 1, 2015,

for the shares of common stock issuable upon exercise of the warrants. These warrants were subsequently assigned to

two

individuals. During the year ended

December 31, 2016,

these individuals exercised warrants for a total of

1,187,995

shares of the Company’s common stock for total proceeds to the Company of less than

$1.00.

In connection with Golisano LLC’s acquisition of the note payable from JL on

March 8, 2017 (

see Note

above for additional information), these warrants were assigned to Golisano LLC.

Golisano LLC Warrants

Pursuant to an

October 2015

Securities Purchase Agreement with Golisano LLC, we issued Golisano LLC a warrant (the “Golisano Warrant”),which Golisano Warrant is intended to maintain, following each future issuance of shares of common stock pursuant to the conversion, exercise or exchange of certain currently outstanding warrants to purchase shares of common stock held by

third

-parties (the “Outstanding Warrants”), Golisano LLC’s proportional ownership of our issued and outstanding common stock so that it is the same thereafter as on

October 5, 2015.

We have reserved

12,697,977

shares of common stock for issuance under the Golisano Warrant. The purchase price for any shares of common stock issuable upon exercise of the Golisano Warrant is

$.001

per share. The Golisano Warrant is exercisable immediately and up to and including the date which is

sixty

days after the later to occur of the termination, expiration, conversion, exercise or exchange of all of the Outstanding Warrants and our delivery of notice thereof to Golisano LLC. The Golisano Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets. In addition, if any payments are made to a holder of an Outstanding Warrant in consideration for the termination of or agreement

not

to exercise such Outstanding Warrant, Golisano LLC will be entitled to equal treatment. We have entered into a registration rights agreement with Golisano LLC, dated as of

October 5, 2015,

granting Golisano LLC certain registration rights for the shares of common stock issuable on exercise of the Golisano Warrant. On

February 6, 2016,

Golisano LLC exercised the Golisano Warrant in part for

509,141

shares of the Company’s common stock for an aggregate purchase price of

$1.00.

During the year ended

December 31, 2016,

the Golisano Warrant was cancelled in part for

6,857,143

shares pursuant to the cancellation of a portion of the Outstanding Warrants. As of

June 30, 2019,

we have reserved

4,542,219

shares of our common stock for issuance under the Golisano Warrant.

GH Warrants

In connection with the

July 2018

GH Note, we issued GH a warrant to purchase an aggregate of

2,500,000

shares of the Company’s common stock at an exercise price of

$0.01

per share (the

"July 2018

GH Warrant"). The

July 2018

GH Warrant is exercisable on any business day prior to the expiration date. The Company has reserved

2,500,000

shares of the Company’s common stock for issuance under the

July 2018

GH Warrant. The

July 2018

GH Warrant expires on

July 27, 2024.

The

July 2018

GH Warrant is also subject to customary adjustments upon any recapitalization, reorganization, stock split up, combination of shares, merger or consolidation. The Company estimated the value of the warrant using the Black-Scholes option pricing model and recorded a debt discount of

$1,479,

which will be amortized over the term of the

July 2018

GH Note.

$493

of the debt discount was amortized during the

six

months ended

June 30, 2019.

In connection with the

November 2018

GH Note, we issued GH a warrant to purchase an aggregate of

2,000,000

shares of the Company’s common stock at an exercise price of

$0.01

per share (the

"November 2018

GH Warrant"). The

November 2018

GH Warrant is exercisable on any business day prior to the expiration date. The Company has reserved

2,000,000

shares of the Company’s common stock for issuance under the

November 2018

GH Warrant. The

November 2018

GH Warrant expires on

November 4, 2024.

The

November 2018

$1,214

which will be amortized over the term of the

November 2018

GH Note.

$405

of the debt discount was amortized during the

six

months ended

June 30, 2019.

Warrants Issued into Escrow

Golisano Escrow Warrants

In connection with the Golisano LLC

January 2016

Note, we issued into escrow in the name of Golisano LLC a warrant to purchase an aggregate of

1,136,363

shares of the Company’s common stock at an exercise price of

$0.01

per share (the

“January 2016

Golisano Warrant”). The

January 2016

Golisano Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay Golisano LLC the entire unamortized principal amount of the related promissory note and any accrued and unpaid interest thereon as of

January 28, 2019 (

which has been extended to

October 22, 2021 –

See Note

) or such earlier date as is required pursuant to an Acceleration Notice (as defined in the related note agreement). We have reserved

1,136,363

shares of the Company’s common stock for issuance under the

January 2016

Golisano Warrant. The

January 2016

Golisano Warrant, if exercisable, expires on

February 28, 2022.

The

January 2016

Golisano Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with the Golisano LLC

March 2016

Note, we issued into escrow in the name of Golisano LLC a warrant to purchase an aggregate of

3,181,816

shares of the Company’s common stock at an exercise price of

$0.01

per share (the

“March 2016

Golisano Warrant”). The

March 2016

Golisano Warrant will

not

March 21, 2019 (

which has been extended to

October 22, 2021 –

See Note

) or such earlier date as is required pursuant to an Acceleration Notice (as defined in the related note agreement). We have reserved

3,181,816

shares of the Company’s common stock for issuance under the

March 2016

Golisano Warrant. The

March 2016

Golisano Warrant, if exercisable, expires on

March 21, 2022.

The

March 2016

In connection with the Golisano LLC

July 2016

Note, we issued into escrow in the name of Golisano LLC a warrant to purchase an aggregate of

2,168,178

shares of the Company’s common stock, at an exercise price of

$0.01

per share (the “Golisano

July 2016

Warrant”). The Golisano

July 2016

Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay Golisano LLC the entire unamortized principal amount of the Golisano LLC

July 2016

Note and any accrued and unpaid interest thereon as of

July 21, 2019 (

which has been extended to

October 22, 2021 –

See Note

) or such earlier date as is required pursuant to an Acceleration Notice (as defined in the Golisano LLC

July 2016

Note). We have reserved

2,168,178

shares of the Company’s common stock for issuance under the Golisano

July 2016

Warrant. The Golisano

July 2016

Warrant, if exercisable, expires on

July 21, 2022.

The Golisano

July 2016

Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with the Golisano LLC

December 2016

Note, we issued into escrow in the name of Golisano LLC a warrant to purchase an aggregate of

1,136,363

shares of the Company’s common stock, at an exercise price of

$0.01

per share (the “Golisano

December 2016

Warrant”). The Golisano

December 2016

Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay Golisano LLC the entire unamortized principal amount of the Golisano LLC

December 2016

Note and any accrued and unpaid interest thereon as of

December 30, 2019

or such earlier date as is required pursuant to an Acceleration Notice (as defined in the Golisano LLC

December 2016

note). We have reserved

1,136,363

shares of the Company’s common stock for issuance under the Golisano

December 2016

Warrant. The Golisano

December 2016

Warrant, if exercisable, expires on

December 30, 2022.

The Golisano

December 2016

Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with the Golisano LLC

March 2017

Note, we issued into escrow in the name of Golisano LLC a warrant to purchase an aggregate of

1,484,847

shares of the Company’s common stock, at an exercise price of

$0.01

per share (the “Golisano

March 2017

Warrant”). The Golisano

March 2017

Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay Golisano LLC the entire unamortized principal amount of the Golisano LLC

March 2017

Note and any accrued and unpaid interest thereon as of

December 30, 2019

or such earlier date as is required pursuant to an Acceleration Notice (as defined in the Golisano LLC

March 2017

Note). We have reserved

1,484,847

shares of the Company’s common stock for issuance under the Golisano

March 2017

Warrant. The Golisano

March 2017

Warrant, if exercisable, expires on

March 14, 2023.

The Golisano

March 2017

Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with the Golisano LLC

February 2018

Note, we issued into escrow in the name of Golisano LLC a warrant to purchase an aggregate of

1,818,182

shares of the Company’s common stock at an exercise price of

$0.01

per share (the "Golisano

2018

Warrant"). The Golisano

2018

Warrant will

not

be released from escrow or be exercisable unless and until the Company fails to pay Golisano LLC the entire unamortized principal amount of the Golisano LLC

February 2018

Note and any accrued and unpaid interest thereon as of

February 6, 2021,

or such earlier date as is required pursuant to an acceleration notice. The Company has reserved

1,818,182

shares of the Company’s common stock for issuance under the Golisano

2018

Warrant. The Golisano

February 2018

Warrant expires on

February 6, 2024.

We previously entered into a registration rights agreement with Golisano LLC, dated as of

October 5, 2015 (

the “Registration Rights Agreement”), granting Golisano LLC certain registration rights for certain shares of the Company’s common stock. The shares of common stock issuable pursuant to the above Golisano LLC warrants are also entitled to the benefits of the Registration Rights Agreement.

GH Escrow Warrants

In connection with a

January 2016

GH Promissory Note, we issued into escrow in the name of GH a warrant to purchase an aggregate of

1,136,363

shares of the Company’s common stock at an exercise price of

$0.01

per share (the

“January 2016

GH Warrant”). The

January 2016

GH Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay GH the entire unamortized principal amount of the

January 2016

GH Promissory Note and any accrued and unpaid interest thereon as of

January 28, 2019 (

which has been extended to

October 22, 2021 –

See Note

) or such earlier date as is required pursuant to an Acceleration Notice (as defined in the

January 2016

GH Promissory Note). We have reserved

1,136,363

shares of the Company’s common stock for issuance under the

January 2016

GH Warrant. The

January 2016

GH Warrant, if exercisable, expires on

February 28, 2022.

The

January 2016

GH Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with a

March 2016

GH Note, we issued into escrow in the name of GH a warrant to purchase an aggregate of

3,181,816

shares of the Company’s common stock at an exercise price of

$0.01

per share (the

“March 2016

GH Warrant”). The

March 2016

GH Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay GH the entire unamortized principal amount of the

March 2016

GH Note and any accrued and unpaid interest thereon as of

March 21, 2019 (

which has been extended to

October 22, 2021 –

See Note

) or such earlier date as is required pursuant to an Acceleration Notice (as defined in the

March 2016

GH Note). We have reserved

3,181,816

shares of the Company’s common stock for issuance under the

March 2016

GH Warrant. The

March 2016

GH Warrant, if exercisable, expires on

March 21, 2022.

The

March 2016

GH Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with the

December 2016

GH Note, we issued into escrow in the name of GH a warrant to purchase an aggregate of

1,136,363

shares of the Company’s common stock, at an exercise price of

$0.01

per share (the

“December 2016

GH Warrant”). The

December 2016

GH Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay GH the entire unamortized principal amount of the

December 2016

GH Note and any accrued and unpaid interest thereon as of

December 30, 2019

or such earlier date as is required pursuant to an Acceleration Notice (as defined in the

December 2016

GH Note). We have reserved

1,136,363

shares of common stock for issuance under the

December 2016

GH Warrant. The

December 2016

GH Warrant, if exercisable, expires on

December 30, 2022.

The

December 2016

GH Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with the

August 2017

GH Note, we issued into escrow in the name of GH a warrant to purchase an aggregate of

1,363,636

shares of the Company’s common stock, at an exercise price of

$0.01

per share (the

“August 2017

GH Warrant”). The

August 2017

GH Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay GH the entire unamortized principal amount of the

August 2017

GH Note and any accrued and unpaid interest thereon as of

August 29, 2020

or such earlier date as is required pursuant to an Acceleration Notice (as defined in the

August 2017

GH Note). We have reserved

1,363,636

shares of common stock for issuance under the

August 2017

GH Warrant. The

August 2017

GH Warrant, if exercisable, expires on

August 30, 2023.

The

August 2017

GH Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets.

In connection with the

February 2018

GH Note, we issued into escrow in the name of GH a warrant to purchase an aggregate of

1,818,182

shares of the Company’s common stock at an exercise price of

$0.01

per share (the

"February 2018

GH Warrant"). The

February 2018

GH Warrant will

not

be released from escrow or be exercisable unless and until the Company fails to pay GH the entire unamortized principal amount of the note and any accrued and unpaid interest thereon as of

February 6, 2021,

or such earlier date as is required pursuant to an acceleration notice. The Company has reserved

1,818,182

shares of the Company’s common stock for issuance under the

February 2018

GH Warrant. The

February 2018

GH Warrant expires on

February 6, 2024.

JL-US Escrow Warrant

In connection with an

April 5, 2016

Unsecured Promissory Note, we issued into escrow in the name of JL-US a warrant to purchase an aggregate of

227,273

shares of the Company’s common stock at an exercise price of

$0.01

per share (the “JL-US Warrant”). The JL-US Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay JL-US the entire unamortized principal amount of the JL-US Note and any accrued and unpaid interest thereon as of

March 21, 2019

or such earlier date as is required pursuant to an Acceleration Notice (as defined in the JL-US Note). We have reserved

227,273

shares of the Company’s common stock for issuance under the JL-US Warrant. The JL-US Warrant, if exercisable, expires on

March 21, 2022.

The JL-US Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets. This warrant expired as a result of payment of the

April 5, 2016

Unsecured Promissory Note in full on

March 21, 2019.

Little Harbor Escrow Warrant

The Little Harbor

July 2016

unsecured delayed draw promissory note provides that we issue into escrow in the name of Little Harbor a warrant to purchase an aggregate of

2,168,178

shares of common stock at an exercise price of

$0.01

per share (the “Little Harbor

July 2016

Warrant”). The Little Harbor

July 2016

Warrant will

not

be released from escrow or be exercisable unless and until we fail to pay Little Harbor the entire unamortized principal amount of the Little Harbor

July 2016

note and any accrued and unpaid interest thereon as of

January 28, 2019 (

which has been extended to

October 22, 2021 –

See Note

) or such earlier date as is required pursuant to an acceleration notice (as defined in the Little Harbor Delayed Draw

July 2016

note). We have reserved

2,168,178

shares of the Company’s common stock for issuance under the Little Harbor Delayed Draw

July 2016

Warrant. The Little Harbor

July 2016

Warrant, if exercisable, expires on

July 21, 2022.

The Little Harbor

July 2016

Warrant is also subject to customary adjustments upon any recapitalization, capital reorganization or reclassification, consolidation, merger or transfer of all or substantially all of our assets. The Little Harbor

July 2016

Warrant grants Little Harbor certain registration rights for the shares of the Company’s common stock issuable upon exercise of the Little Harbor

July 2016

Warrant.