CONVERSION AND REGISTRATION RIGHTS AGREEMENT

THE SHARES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY OTHER APPLICABLE SECURITIES LAWS IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER SECURITIES LAWS.  THE SHARES ISSUABLE UPON EXERCISE HEREOF MAY NOT BE SOLD, PLEDGED, TRANSFERRED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR IN A TRANSACTION WHICH IS EXEMPT FROM REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT.

For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and agreed, Cane Clark Productions, LLC (the “Holder”), shall have the right, from time to time, to convert all or part of the then unpaid principal and accrued interest balance due under that certain Convertible Promissory Note and Security Agreement (the “Note”) into fully paid and non-assessable shares of the Common Stock (the “Common Stock”) of Secured Diversified Investment, Ltd., a Nevada corporation (the “Company”) at an Conversion Price of $0.20 US per share (the “Conversion Price”), subject to further adjustment as set forth herein, at any time prior to full repayment of the Note by the Company (the “Termination Date”).

1.   Separate Assignment Prohibited .  Prior to the Termination Date and subject to compliance with applicable laws, this Agreement and all rights hereunder are transferable, in whole or in part, at the office or agency of the Company by the Holder hereof in person or by duly authorized attorney, upon surrender of this Agreement and the Note together with the Assignment Form annexed hereto properly endorsed.  This Agreement may not be assigned or transferred separately from a corresponding interest in the Note.

2.   Authorization of Shares .  The Company covenants that all shares of Common Stock which may be issued upon the exercise of rights represented by this Agreement will, upon exercise of the rights represented by this Agreement, be duly authorized, validly issued, fully paid and non-assessable and free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).

3.   Exercise of Conversion Rights .

(a)           Exercise of the conversion rights set forth in this Agreement (“Conversion Rights”) may be made at any time or times and before the close of business on the Termination Date by the surrender of this Agreement, the Note and the Notice of Exercise Form annexed hereto duly executed, at the office of the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder hereof at the address of such holder appearing on the books of the Company), and thereupon the Holder shall be entitled to receive a certificate for the number of shares of Common Stock so converted.

(b)           Certificates for shares converted hereunder shall be delivered to the Holder hereof within five (5) trading days after the date on which the Conversion Rights shall have been exercised as aforesaid. The Conversion Rights shall be deemed to have been exercised and such certificate or certificates shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a Holder of record of such shares for all purposes, as of the date the  Conversion Rights have been exercised.

4.   Charges, Taxes and Expenses .  Issuance of certificates for shares of Common Stock upon the exercise of the Conversion Rights shall be made without charge to the Holder hereof for any issue or transfer tax or other incidental expense in respect of the issuance of such certificate, and such certificates shall be issued in the name of the Holder or in such name or names as may be directed by the Holder.

5.   Closing of Books .  The Company will not close its shareholder books or records in any manner which prevents the timely exercise of the Conversion Rights.

6.   Transfer, Division and Combination .

(a)   Subject to compliance with any applicable securities laws, transfer of the Note and this Agreement and all rights hereunder, in whole or in part, shall be registered on the books of the Company to be maintained for such purpose, upon surrender of the Note and this Agreement at the principal office of the Company, together with a written assignment of the Note and this Agreement substantially in the form attached hereto duly executed by Holder or its agent or attorney.  Upon such surrender, the Company shall execute and deliver a new Note and Agreement or Notes and Agreements in the name of the assignee or assignees and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Note and Agreement evidencing the portion of the Note and this Agreement not so assigned.

(b)           The Note and this Agreement may be divided upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Notes are to be issued, signed by Holder or its agent or attorney.  Subject to compliance with Section 6(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Note and Agreement or Notes and Agreements in exchange for the Note to be divided in accordance with such notice.

(c)           The Company shall prepare, issue and deliver at its own expense (other than transfer taxes) the new Note or Notes and Agreement or Agreements under this Section 6.

(d)           The Company agrees to maintain, at its aforesaid office, books for the registration and the registration of transfer of the Notes and Agreements.

7.   No Rights as Shareholder until Exercise .  Neither the Note nor this Agreement entitle the Holder hereof to any voting rights or other rights as a shareholder of the Company prior to the exercise of the Conversion Rights set forth herein.  Upon the surrender of the Note and the exercise of Conversion Rights hereunder, the Common Stock so acquired shall be and be deemed to be issued to such Holder as the record owner of such shares as of the close of business on the date of such surrender.

8.   Loss, Theft, Destruction or Mutilation of Note .  The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of Note, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which shall not include the posting of any bond), and upon surrender and cancellation of such Note, if mutilated, the Company will make and deliver a new Note of like tenor and dated as of such cancellation.

9.   Saturdays, Sundays, Holidays, etc .  If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall be a Saturday, Sunday or a legal holiday, then such action may be taken or such right may be exercised on the next succeeding day not a Saturday, Sunday or legal holiday.

10.   Adjustments of Conversion Price and Number of Conversion Shares .

(a)   Stock Splits, etc. The number and kind of securities purchasable upon the exercise of the Conversion Rights shall be subject to adjustment from time to time upon the happening of any of the following.  In case the Company shall: (i) pay a dividend in shares of Common Stock or make a distribution in shares of Common Stock to Holders of its outstanding Common Stock, (ii) subdivide its outstanding shares of Common Stock into a greater number of shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock, or (iv) issue any shares of its capital stock in a reclassification of the Common Stock, then the number of shares of Common Stock purchasable upon exercise of the Conversion Rights (the “Conversion Shares”) immediately prior thereto shall be adjusted so that the Holder shall be entitled to receive the kind and number of Conversion Shares or other securities of the Company which he would have owned or have been entitled to receive had the Conversion Rights been exercised in advance thereof.  Upon each such adjustment of the kind and number of Conversion Shares or other securities of the Company which are purchasable hereunder, the Holder shall thereafter be entitled to purchase the number of Conversion Shares or other securities resulting from such adjustment at an Conversion Price per Conversion Share or other security obtained by multiplying the Conversion Price in effect immediately prior to such adjustment by the number of Conversion Shares purchasable pursuant hereto immediately prior to such adjustment and dividing by the number of Conversoin Shares or other securities of the Company resulting from such adjustment.  An adjustment made pursuant to this paragraph shall become effective immediately after the effective date of such event retroactive to the record date, if any, for such event.

(b)   Reorganization, Reclassification, Merger, Consolidation or Disposition of Assets .  In case the Company shall reorganize its capital, reclassify its capital stock, consolidate or merge with or into another corporation (where the Company is not the surviving corporation or where there is a change in or distribution with respect to the Common Stock of the Company), or sell, transfer or otherwise dispose of all or substantially all its property, assets or business to another corporation and, pursuant to the terms of such reorganization, reclassification, merger, consolidation or disposition of assets, shares of common stock of the successor or acquiring corporation, or any cash, shares of stock or other securities or property of any nature whatsoever (including warrants or other subscription or purchase rights) in addition to or in lieu of common stock of the successor or acquiring corporation (“Other Property”), are to be received by or distributed to the Holders of Common Stock of the Company, then Holder shall have the right thereafter to receive, upon exercise of the Conversion Rights, the number of shares of common stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and Other Property receivable upon or as a result of such reorganization, reclassification, merger, consolidation or disposition of assets by a Holder of the number of shares of Common Stock for which the Conversion Rights is exercisable immediately prior to such event.  In case of any such reorganization, reclassification, merger, consolidation or disposition of assets, the successor or acquiring corporation (if other than the Company) shall expressly assume the due and punctual observance and performance of each and every covenant and condition of this Agreement to be performed and observed by the Company and all the obligations and liabilities hereunder, subject to such modifications as may be deemed appropriate (as determined in good faith by resolution of the Board of Directors of the Company) in order to provide for adjustments of shares of Common Stock for which the Note is convertible which shall be as nearly equivalent as practicable to the adjustments provided for in this Section 10.  For purposes of this Section 10, “common stock of the successor or acquiring corporation” shall include stock of such corporation of any class which is not preferred as to dividends or assets over any other class of stock of such corporation and which is not subject to redemption and shall also include any evidences of indebtedness, shares of stock or other securities which are convertible into or exchangeable for any such stock, either immediately or upon the arrival of a specified date or the happening of a specified event and any warrants or other rights to subscribe for or purchase any such stock.  The foregoing provisions of this Section 10 shall similarly apply to successive reorganizations, reclassifications, mergers, consolidations or disposition of assets.

11.   Notice of Adjustment .  Whenever the number of Conversion Shares or number or kind of securities or other property purchasable upon the exercise of the Conversion Rights or the Conversion Price is adjusted, as herein provided, the Company shall promptly mail by registered or certified mail, return receipt requested, to the Holder notice of such adjustment or adjustments setting forth the number of Conversion Shares (and other securities or property) purchasable upon the exercise of the Conversion Rights and the Conversion Price of such Conversion Shares (and other securities or property) after such adjustment, setting forth a brief statement of the facts requiring such adjustment and setting forth the computation by which such adjustment was made.  Such notice, in the absence of manifest error, shall be conclusive evidence of the correctness of such adjustment.

12.   Notice of Corporate Action .  If at any time:

(a)           the Company shall take a record of the Holders of its Common Stock for the purpose of entitling them to receive a dividend or other distribution, or any right to subscribe for or purchase any evidences of its indebtedness, any shares of stock of any class or any other securities or property, or to receive any other right, or

(b)           there shall be any capital reorganization of the Company, any reclassification or recapitalization of the capital stock of the Company or any consolidation or merger of the Company with, or any sale, transfer or other disposition of all or substantially all the property, assets or business of the Company to, another corporation, or

(c)           there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company;

then, in any one or more of such cases, the Company shall give to Holder (i) at least 3 days’ prior written notice of the date on which a record date shall be selected for such dividend, distribution or right or for determining rights to vote in respect of any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, liquidation or winding up, and (ii) in the case of any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up, at least 3 days’ prior written notice of the date when the same shall take place.  Such notice in accordance with the foregoing clause also shall specify (a) the date on which any such record is to be taken for the purpose of such dividend, distribution or right, the date on which the Holders of Common Stock shall be entitled to any such dividend, distribution or right, and the amount and character thereof, and (b) the date on which any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up is to take place and the time, if any such time is to be fixed, as of which the Holders of Common Stock shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such disposition, dissolution, liquidation or winding up.  Each such written notice shall be sufficiently given if addressed to Holder at the last address of Holder appearing on the books of the Company and delivered in accordance with Section 18(e).

13.   Authorized Shares .  The Company covenants that during the period the Note is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Conversion Shares upon the exercise of the Conversion Rights.  The Company further covenants that its issuance of the Note shall constitute full authority to its officers who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for the Conversion Shares upon the exercise of the Conversion Rights.  The Company will take all such reasonable action as may be necessary to assure that such Conversion Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Principal Market upon which the Common Stock may be listed.

14.   No Impairment .  The Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Agreement, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder against impairment.  Without limiting the generality of the foregoing, the Company will (a) not increase the par value of any shares of Common Stock receivable upon the exercise of the Conversion Rights above the amount payable therefor upon such exercise immediately prior to such increase in par value, (b) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of Common Stock upon the exercise of the Conversion Rights, and (c) use its best efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Agreement. Before taking any action which would cause an adjustment reducing the current Conversion Price below the then par value, if any, of the shares of Common Stock issuable upon exercise of the Conversion Rights, the Company shall take any corporate action which may be necessary in order that the Company may validly and legally issue fully paid and non-assessable shares of such Common Stock at such adjusted Conversion Price.

15.   Written Acknowledgment .  Upon the request of Holder, the Company will at any time during the period Note is outstanding acknowledge in writing, in form reasonably satisfactory to Holder, the continuing validity of the Note, this Agreement and the obligations of the Company hereunder.

16.   Prior Regulatory Approval .  Before taking any action which would result in an adjustment in the number of shares of Common Stock for which the Note is convertible or in the Conversion Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

17.   Registration Rights .

(a)   Definitions .  As used in this Agreement, the following terms shall have the following meanings.

(1)   The term “Holder” shall mean any person owning or having the right to acquire Registrable Securities or any permitted transferee of a Holder.

(2)   The terms “register,” “registered” and “registration” refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Securities Act, and the declaration or order of effectiveness of such registration statement or document.

(3)   The term “Registrable Securities” shall mean the Conversion Shares; provided, however, that securities shall only be treated as Registrable Securities if and only for so long as they (A) have not been disposed of pursuant to a registration statement declared effective by the SEC; (B) have not been sold in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act so that all transfer restrictions and restrictive legends with respect thereto are removed upon the consummation of such sale; (C) are held by a Holder or a permitted transferee of a Holder; and (D) may not be disposed of under Rule 144 under the Securities Act without restriction.

(b)   Piggyback Registration .

(1)   The Company agrees that if, at any time, and from time to time, after the closing, the Board of Directors of the Company (the “Board”) shall auth