Exhibit 10.2

 

THIS NOTE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS.

 

 

No. 2020C-001 U.S. $125,000   Original Issue Date: July 1, 2020

 

3% SECURED CONVERTIBLE PROMISSORY NOTE

DUE JULY 1, 2022

 

THIS NOTE is a duly authorized Note of MAGELLAN GOLD CORPORATION, a Nevada
corporation, (the “Company” or “Maker”), designated as a 3% Secured Convertible
Note (the “Note”) due on July 1, 2022 (the “Maturity Date”), in an aggregate
principal amount of $125,000 plus accrued and unpaid interest.

 

FOR VALUE RECEIVED, the Company promises to pay to GREGORY SCHIFRIN, the
registered holder hereof (the "Holder"), the principal sum of One Hundred
Twenty-five Thousand Dollars (US $125,000) and to pay interest on the principal
sum outstanding from time to time in arrears at the rate of 3% per annum
calculated from the date of initial issuance of this Note (the “Issue Date”) and
payable yearly, in cash, in arrears beginning on July 1, 2021 and continuing
each anniversary of the Issue Date thereafter until the Maturity Date (the
“Interest Payment Date”). Accrual of interest shall commence on the first such
business day to occur after the Issue Date and shall continue to accrue until
payment in full of the principal sum has been made or duly provided for.

 

The Company shall pay all accrued and unpaid interest, in arrears, on each
Interest Payment Date, as provided herein, and shall pay the outstanding
principal balance hereof on the earlier of (i) the Conversion Date, or (ii) the
Maturity Date.

 

This Note is subject to the following additional provisions.

 

Section 1.              Collateral. The Company’s obligation to repay all sums
due under this Note and perform all covenants to be performed hereunder are
secured by a UCC Security Agreement covering all of the tangible and intangible
assets of Borrower’s wholly owned subsidiary, Clearwater Gold Mining Corporation
(the “Security Agreement”) and a Stock Pledge Agreement covering 1,000,000
shares of common stock of Clearwater Gold Mining Corporation purchased by the
Company from Holder.

 

Section 2.               No Sale or Transfer. This Note may not be sold,
transferred, assigned, hypothecated or divided into two or more Notes of smaller
denominations except to the extent such sale, transfer, assignment,
hypothecation or division is in compliance with federal and applicable state
securities laws, the compliance with which must be established to the reasonable
satisfaction of the Company.

 

Section 3.               No Limitations on Debt. The existence of this Note does
not preclude the Company from incurring other indebtedness (including secured
debt and including other notes which may, by their terms, be senior to the
Notes).

 

Section 4.               Provisions Regarding Payment of Interest. Interest
hereunder will be paid to the Holder on each Interest Payment Date, as
hereinabove defined. If not paid previously, all interest will be payable at the
Maturity Date.

 

 

 

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Section 5.               (a)           “Event of Default” wherever used herein,
means any one of the following events (whatever the reason and whether it shall
be voluntary or involuntary or effected by operation of law or pursuant to any
judgment, decree or order of any court, or any order, rule or regulation of any
administrative or governmental body):

 

(i)       Any default in the payment of the principal of or interest on this
Note as and when the same shall become due and payable, (whether on the Maturity
Date or by acceleration or otherwise);

 

(ii)               The Company shall fail to observe or perform any other
covenant, agreement or warranty contained in, or otherwise commit any breach of,
this Note or and such failure or breach shall not have been remedied within 30
days after the date on which notice of such failure or breach shall have been
given;

 

(iii)       The Company shall commence a voluntary case under the United States
Bankruptcy Code or insolvency laws as now or hereafter in effect or any
successor thereto (the “Bankruptcy Code”); or an involuntary case is commenced
against the Company under the Bankruptcy Code and the petition is not
controverted within 30 days, or is not dismissed within 60 days, after
commencement of such involuntary case; or a “custodian” (as defined in the
Bankruptcy Code) is appointed for, or takes charge of, all or any substantial
part of the property of the Company or the Company commences any other
proceeding under any reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to the Company or there
is commenced against the Company any such proceeding which remains undismissed
for a period of 60 days; or the Company is adjudicated insolvent or bankrupt; or
any order of relief or other order approving any such case or proceeding is
entered; or the Company suffers any appointment of any custodian or the like for
it or any substantial part of its property which continues undischarged or
unstayed for a period of 60 days; or the Company makes a general assignment for
the benefit of creditors; or the Company shall fail to pay, or shall state that
it is unable to pay its debts generally as they become due; or the Company shall
call a meeting of all of its creditors with a view to arranging a composition or
adjustment of its debts; or the Company shall by any act or failure to act
indicate its consent to, approval of or acquiescence in any of the foregoing; or
any corporate or other action is taken by the Company for the purpose of
effecting any of the foregoing.

 

(b)            Remedies. The Holder may declare a default under Section 5(a)(i)
upon not less than 15 days’ written notice to the Company. If the Company fails
to cure an Event of Default within such period (or if the cure cannot be
reasonably completed within such period, commence the cure of the Event of
Default and diligently pursue such cure), then the principal amount hereof
together with all accrued and unpaid interest up to the date of default shall
thereafter accrue interest at the default interest rate of 6% per annum and the
Holder may:

 

(i)             Declare all amounts due under the Notes immediately due and
owing and exercise all rights with respect thereto permitted by law;

 

(ii)            Convert all of the Notes into common stock of the Company; or

 

(iii)           Assert any other remedy available at law or in equity.

 

Section 6.               Prepayment. The Company may prepay this Note in whole
or in part at any time prior to the Maturity Date upon not less than 30 days’
written notice to the Holder.

 

Section 7.               Definitions. For the purposes hereof, the following
terms shall have the following meanings:

 

“Business Day” means any day except Saturday, Sunday and any day which shall be
a legal holiday or a day on which banking institutions in the State of Colorado
are authorized or required by law or other government action to close.

 

“Company” means Magellan Gold Corporation, a Nevada corporation.

 

 

 

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“Conversion Amount” shall mean the total of unpaid principal and accrued but
unpaid interest at the date such amount is determined.

 

“Conversion Price” shall mean $0.50 per share of Common Stock, as adjusted as
set forth in Section 8(d), below.

 

“Conversion Shares” shall mean the shares of the Company’s common stock issued
or issuable upon conversion of the Notes.

 

“Holder” means any Person who is a registered holder of this Note as listed in
the books of the Company.

 

“Interest Payment Date” is as defined in the paragraph entitled “FOR VALUE
RECEIVED,” above.

 

“Market Price” at any date shall be deemed to be (i) if the principal trading
market for such securities is any exchange, the last reported sale price, on
each Trading Day for which determination is made as officially reported on any
consolidated tape, (ii) if the principal market for such securities is the
over-the-counter market, the closing prices (or, if no closing price, the
closing bid price) on such Trading Days as set forth by Nasdaq or the OTC.QB
(whichever is the principal market for the Company’s common stock) as reported
at http://finance.yahoo.com or, (iii) if the security is not quoted on Nasdaq or
the OTC.QB), the average bid and asked price as set forth on the OTC.QB of the
OTC Markets Group, Inc. for such day. Notwithstanding the foregoing, if there is
no reported closing price or bid price, as the case may be, on any of the ten
trading days preceding the event requiring a determination of Market Price
hereunder, then the Market Price shall be determined in good faith by resolution
of the Board of Directors of the Company, based on the best information
available to it.

 

“Material Adverse Effect” means a material adverse effect upon the business,
operations, properties, assets or condition (financial or otherwise) of the
Company taken as a whole.

 

“Maturity Date” means the date defined in the first paragraph or (if earlier)
the date of any conversion, prepayment or acceleration.

 

“Original Issue Date” shall mean the date this Note is purchased by the initial
holder.

 

“Person” means a corporation, an association, a partnership, organization, a
business, an individual, a government or political subdivision thereof or a
governmental agency.

 

“Trading Day” means a day in which the market on which shares of the Company’s
common stock are principally traded is open for trading, whether or not any
shares of the Company’s common stock are actually traded on that day.

 

Section 8.               Conversion.

 

a.             Voluntary Conversion. At any time before this Note has been paid,
the Holder may convert the Conversion Amount into shares of the Company’s common
stock by dividing the Conversion Amount by the Conversion Price.

 

 

 

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b.             Limitation on Conversion. Notwithstanding any other provision
hereof, in no event (except (i) as specifically provided herein as an exception
to this provision, or (ii) while there is outstanding a tender offer for any or
all of the shares of the Company’s Common Stock) shall the Holder be entitled to
convert any portion of this Note, or shall the Company have the obligation to
convert such Note (and the Company shall not have the right to pay interest
hereon in shares of Common Stock) to the extent that, after such conversion or
issuance of stock in payment of interest, the sum of (1) the number of shares of
Common Stock beneficially owned by the Holder and its affiliates (other than
shares of Common Stock which may be deemed beneficially owned through the
ownership of the unconverted portion of the Notes or other convertible
securities or of the unexercised portion of warrants or other rights to purchase
Common Stock), and (2) the number of shares of Common Stock issuable upon the
conversion of the Notes with respect to which the determination of this proviso
is being made, would result in beneficial ownership by the Holder and its
affiliates of more than 4.99% of the outstanding shares of Common Stock (after
taking into account the shares to be issued to the Holder upon such conversion).
For purposes of the proviso to the immediately preceding sentence, beneficial
ownership shall be determined in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended, except as otherwise provided in clause (1) of
such sentence. The Holder, by its acceptance of this Note, further agrees that
if the Holder transfers or assigns any of the Notes to a party who or which
would not be considered such an affiliate, such assignment shall be made subject
to the transferee’s or assignee’s specific agreement to be bound by the
provisions of this Section 8(b) as if such transferee or assignee were the
original Holder hereof. Nothing herein shall preclude the Holder from disposing
of a sufficient number of other shares of Common Stock beneficially owned by the
Holder so as to thereafter permit the continued conversion of this Note. The
provisions of this Section 8(b) may be waived in writing by agreement of the
Holder and the Company.

 

c.              Manner of Converison. Conversion shall be effectuated by faxing
a Notice of Conversion (as defined below) to the Company as provided in this
paragraph. The Notice of Conversion shall be executed by the Holder of this Note
and shall evidence such Holder's intention to convert this Note or a specified
portion hereof in the form annexed hereto as Exhibit A. No fractional shares of
Common Stock or scrip representing fractions of shares will be issued on
conversion, but the number of shares issuable shall be rounded to the nearest
whole share. The date on which notice of conversion is given (the "Conversion
Date") shall be deemed to be the date on which the Holder faxes or otherwise
delivers the conversion notice ("Notice of Conversion") to the Company so that
it is received by the Company on or before such specified date, provided that,
if such conversion would convert the entire remaining principal of this Note,
the Holder shall deliver to the Company the original Note being converted no
later than five (5) business days thereafter. Email delivery of the Notice of
Conversion shall be accepted by the Company at johncaseypower@gmail.com:
Attention John C. Power. Certificates representing Common Stock upon conversion
(“Conversion Certificates”) will be delivered to the Holder at the address
specified in the Notice of Conversion (which may be the Holder’s address for
notices as contemplated by the Subscription Agreement or a different address),
via express courier, by electronic transfer or otherwise, as provided in Section
8(d)(iii) below, and, if interest is paid by Common Stock, the Interest Payment
Date. The Holder shall be deemed to be the holder of the shares issuable to it
in accordance with the provisions of this Section 8(c) on the Conversion Date.

 

d.             Nature of Common Stock Issued.

 

(i)            When issued upon conversion of the Note pursuant to Section 8(a)
hereof, the Conversion Shares will be legally and validly issued, fully-paid and
non-assessable.

 

(ii)            Upon any conversion, this Note will be deemed cancelled and of
no further force and effect, representing only the right to receive the
Conversion Shares, regardless whether the Holder delivers this Note to the
Company for cancellation.

 

(iii)           As soon as possible after a conversion has been effected (and
subject to the Holder having returned the Note to the Company for cancellation),
the Company will deliver to the converting holder a certificate or certificates
representing the Conversion Shares issuable by reason of such conversion in such
name or names and such denomination or denominations as the converting holder
has specified If any fractional share of common stock would be issuable upon any
conversion, the Company will pay the holder of the Conversion Shares an amount
equal to the Market Price of such fractional share.

 

(iv)           The issuance of certificates for shares of Conversion Shares will
be made without charge.

 

(v)            The Company will not close its books against the transfer of the
Conversion Shares issued or issuable in any manner which interferes with the
conversion of this Note.

 

 

 

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e.              Adjustments for Capital Reorganization, Reclassification or
Transfer or Assets. In the event the Common Stock issuable upon conversion of
the Note shall be changed into the same or different number of shares of any
class or classes of stock, whether by capital reorganization, reclassification
or otherwise, or in the event Maker shall at any time issue Common Stock by way
of dividend or other distribution on any stock of Maker, or subdivide or combine
the outstanding shares of Common Stock, then in each such event the Holder shall
have the right thereafter, but not the obligation, to exercise such Note and
receive the kind and amount of shares of stock and other securities and property
receivable upon such reorganization, reclassification or other change by holders
of the number of shares of Common Stock into which such Note might have been
exercised immediately prior to such organization, reclassification or change. In
the case of any such reorganization, reclassification or change, the Conversion
Price shall also be appropriately adjusted so as to maintain the aggregate
Conversion Price. Further, in case of any such consolidation or merger of Maker
with or into another corporation in which consolidation or merger Maker is not
the continuing corporation, or in case of any sale or conveyance to another
corporation of the property of Maker as an entirety, or substantially as an
entirety, Maker shall cause effective provision to be made so that the Holder
shall have the right thereafter, by converting the Note, to purchase the kind
and amount of shares of stock and other securities and property receivable upon
such consolidation, merger, sale or conveyance by holders of the number of share
of Common Stock into which such Note might have been exercised immediately prior
to such consolidation, merger, sale or conveyance, which provision shall provide
for adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Note. The foregoing provisions shall similarly
apply to successive reclassifications, capital reorganizations and changes of
shares of Common Stock and to successive consolidations, mergers, sales or
conveyances. Notwithstanding the foregoing, no adjustment of the Conversion
Price shall be made as a result of or in connection with (1) the issuance of
Common Stock of Maker pursuant to options, warrants and share purchase
agreements now in effect or hereafter outstanding or created, (2) the
establishment of option plans of Maker, the modification, renewal or extension
of any plan now in effect or hereafter created, or the issuance of Common Stock
upon exercise of any options pursuant to such plans, (3) the issuance of Common
Stock in connection with an acquisition, consolidation or merger of any type in
which Maker is the continuing corporation, or (4) the issuance of Common Stock
in consideration of such cash, property or service as may be approved by the
Board of Directors of Maker and permitted by applicable law.

 

f.              Anti-Dilution Provisions.

 

(i)             Adjustment for Dividends. In the event the Company shall make or
issue, or shall have issued, or shall fix a record date for the determination of
holders of common stock entitled to receive a dividend or the distribution
(other than a distribution otherwise provided for herein) payable in
(a) securities of the Company other than shares of common stock or (b) assets
(including cash paid or payable out of capital or capital surplus or surplus
created as a result of a revaluation of property, but excluding the cumulative
dividends payable with respect to an authorized series of Preferred Stock), then
and in each such event provision shall be made so that the holders of Notes
shall receive upon conversion thereof in addition to the number of shares of
common stock receivable thereupon, the number of securities or such other assets
of the Company which they would have received had their Notes been converted
into common stock on the date of such event and had they thereafter, during the
period from the date of such event to and including the conversion date,
retained such securities or such other assets receivable by them as aforesaid
during such period, giving application to all adjustments called for during such
period under this paragraph with respect to Note holders.

 

(ii)            Adjustment for Capital Reorganization or Reclassification. If
the common stock issuable upon the conversion of the Notes shall be changed into
the same or different number of shares of any class or classes of stock, whether
by capital reorganization, reclassification or otherwise then and in each such
event the holder of the Notes shall have the right thereafter to exercise such
Notes and receive the kind an amount of shares of stock and other securities and
property receivable upon such reorganization, reclassification or other change
by holders of the number of shares of common stock into which such Note might
have been exercised immediately prior to such reorganization, reclassification
or change, all subject to further adjustment as provided herein.

 

(iii)           Convertible Securities. For the purpose of the adjustment
provided for in section (iv) of this Section 8 (f), if at any time or from time
to time after the date of this Note the Company shall issue any rights or
options for the purchase of, or stock or other securities, including convertible
debt, convertible into, additional shares of common stock (such convertible
stock or securities being hereafter referred to as "convertible securities,")
then and in such event, whether or not the convertible security is actually
converted or exercised to acquire additional shares of Common Stock, such
convertible securities shall be deemed to have been so converted or exercised,
in which event the conversion Price or exercise price of the convertible
securities shall be treated as the consideration per share received by the
Company for such securities for the purpose of determining the adjustment, if
any, provided for in Subsection (i) of this paragraph.

 

 

 

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(iv)           Adjustment of Number of Shares. Anything in this Certificate to
the contrary notwithstanding, in case the Company shall at any time issue Common
Stock or Convertible Securities by way of dividend or other distribution on any
stock of the Company or subdivide or combine the outstanding shares of Common
Stock, the Conversion Price shall be proportionately decreased in the case of
such issuance (on the day following the date fixed for determining shareholders
entitled to receive such dividend or other distribution) or decreased in the
case of such subdivision or increased in the case of such combination (on the
date that such subdivision or combination shall become effective).

 

(v)            No Adjustment for Small Amounts. Anything in this paragraph to
the contrary notwithstanding, the Company shall not be required to give effect
to any adjustment in the Conversion Price unless and until the net effect of one
or more adjustments, determined as above provided, shall have required a change
of the Converion Price by at least one cent, but when the cumulative net effect
of more than one adjustment so determined shall be to change the actual
Conversion Price by at least one cent, such change in the Conversion Price shall
thereupon be given effect.

 

(vi)           Common Stock Defined. Whenever reference is made in this
paragraph 6(e) to the issue or sale of shares of Common Stock, the term "Common
Stock" shall mean the Common Stock of the Company of the class authorized as of
the date hereof and any other class of stock ranking on a parity with such
Common Stock. However, subject to the provisions of paragraph 6 hereof, shares
issuable upon exercise hereof shall include only shares of the class designated
as Common Stock of the Company as of the date hereof.

 

 

g.             Exercise of Conversion Privilege. To exercise its conversion
privilege or in the event of the automatic conversion of the Note, the Holder
shall surrender such Note, or recognize partial prepayment therefor, being
converted to Maker at its principal office, and shall give written notice to
Maker at that office that Holder is delivering the Note for conversion or
recognizing partial prepayment. Such notice shall also state the name or names
(with address or addresses) in which the certificate or certificates for shares
of Common Stock issuable upon such conversion shall be issued. The Note, if
surrendered for conversion shall be accompanied by proper assignment thereof to
the Company or in blank.

 

h.             Notice of Record Date. In the event of:

 

(1)            any taking by Maker of a record of the holders of any class of
securities for the purpose of determining the holders thereof who are entitled
to receive any dividend or other distribution, or any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right, or

 

(2)            any capital reorganization of Maker, any reclassification or
recapitalization of the capital stock of Maker, any merger or consolidating of
Maker or a transfer of all or substantially all of the assets of the company to
any other corporation, or any other entity or person, or

 

(3)            any voluntary or involuntary dissolution, liquidation or winding
up of Maker, then and in each such event Maker shall mail or cause to be mailed
to the Holder a notice specifying (i) the date on which any such record is to be
taken for the purpose of such dividend, distribution or right and a description
of said dividend, distribution or right, (ii) the date on which any such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding up is expected to become effective
and (iii) the time, if any, that is to be fixed, as to when the holders of
record of common stock (or other securities) shall be entitled to exchange their
shares of common stock (or other securities) for securities or other property
deliverable upon such reorganization, reclassification, recapitalization,
transfer, consolidation, merger, dissolution, liquidation or winding up. Such
notice shall be mailed at least thirty (30) days prior to the date specified in
such notice on which such action is to be taken.

 

i.               Continuation of Terms. Upon any reorganization, consolidation
or merger referred to in this Section 8, the Note shall continue in full force
and effect until conversion by the Holder and the terms hereof shall be
applicable to the shares of stock and other securities and property receivable
on the conversion of any Note after the consummation of such reorganization,
consolidation, merger of any similar event and shall be binding upon the issuer
of any such stock or other securities, including, in the case of any such
transfer, the person acquiring all or substantially all of the properties or
assets of Maker whether or not such person shall have expressly assumed the
terms of the Note.

 

 

 

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Section 9.               No Impairment. Except as expressly provided herein, no
provision of this Note shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of, and interest on,
this Note at the time, place, and rate, and in the coin or currency, herein
prescribed. This Note is a direct obligation of the Company.

 

Section 10.             No Rights as a Shareholder. This Note shall not entitle
the Holder to any of the rights of a stockholder of the Company, including
without limitation, the right to vote, to receive dividends and other
distributions, or to receive any notice of, or to attend, meetings of
stockholders or any other proceedings.

 

Section 11.             No recourse shall be had for the payment of the
principal of, or the interest on, this Note, or for any claim based hereon, or
otherwise in respect hereof, against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.

 

Section 12.             All payments contemplated hereby to be made “in cash”
shall be made in immediately available good funds of United States of America
currency by wire transfer to an account designated in writing by the Holder to
the Company (which account may be changed by notice similarly given). All
payments of cash and each delivery of shares of Common Stock issuable to the
Holder as contemplated hereby shall be made to the Holder at the address last
appearing on the Note Register of the Company as designated in writing by the
Holder from time to time; except that the Holder can designate, by notice to the
Company, a different delivery address for any one or more specific payments or
deliveries.

 

Section 13.             The Holder of the Note, by acceptance hereof, agrees
that this Note is being acquired for investment and that such Holder will not
offer, sell or otherwise dispose of this Note or the shares of Common Stock
issuable upon conversion thereof except under circumstances which will not
result in a violation of the Act or any applicable state Blue Sky or foreign
laws or similar laws relating to the sale of securities.

 

Section 14.             The Note will initially be issued in denominations
determined by the Company, but are exchangeable for an equal aggregate principal
amount of Notes of different denominations, as requested by the Holder
surrendering the same. No service charge will be made for such registration or
transfer or exchange.

 

Section 15.             The Company shall be entitled to withhold from all
payments of principal of, and interest on, this Note any amounts required to be
withheld under the applicable provisions of the United States income tax laws or
other applicable laws at the time of such payments, and Holder shall execute and
deliver all required documentation in connection therewith.

 

Section 16              This Note has been issued subject to investment
representations of the original purchaser hereof and may be transferred or
exchanged only in compliance with the Securities Act of 1933, as amended (the
"Act"), and other applicable state and foreign securities laws and the terms of
the Subscription Agreement. In the event of any proposed transfer of this Note,
the Company may require, prior to issuance of a new Note in the name of such
other person, that it receive reasonable transfer documentation that is
sufficient to evidence that such proposed transfer complies with the Act and
other applicable state and foreign securities laws and the terms of the
Subscription Agreement. Prior to due presentment for transfer of this Note, the
Company and any agent of the Company may treat the person in whose name this
Note is duly registered on the Company's Note Register as the owner hereof for
the purpose of receiving payment as herein provided and for all other purposes,
whether or not this Note be overdue, and neither the Company nor any such agent
shall be affected by notice to the contrary.

 

Section 17.             Mutilated, Lost or Stolen Notes. If this Note shall be
mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in
exchange and substitution for and upon cancellation of a mutilated Note, or in
lieu of or in substitution for a lost, stolen or destroyed Note, a new Note for
the principal amount of this Note so mutilated, lost, stolen or destroyed but
only upon receipt of evidence of such loss, theft or destruction of such Note,
and of the ownership hereof, and adequate indemnity, if requested, all
reasonably satisfactory to the Company.

 

 

 

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Section 18.             Governing Law. This Note shall be governed by and
construed in accordance with the laws of the State of Colorado. Each of the
parties consents to the exclusive jurisdiction of the federal courts whose
districts encompass any part of Boulder, Colorado, or the state courts of the
State of Colorado sitting in Boulder County, Colorado in connection with any
dispute arising under this Agreement and hereby waives, to the maximum extent
permitted by law, any objection, including any objection based on forum non
coveniens, to the bringing of any such proceeding in such jurisdictions. To the
extent determined by such court, the Company shall reimburse the Holder for any
reasonable legal fees and disbursements incurred by the Holder in enforcement of
or protection of any of its rights under any of this Note.

 

Section 19.             Waiver of Jury Trial; No Other Waivers. The Company and
the Holder hereby waive the right to a trial by jury in any action, proceeding
or counterclaim in respect of any matter arising out or in connection with this
Note. Any waiver by the Company or the Holder of a breach of any provision of
this Note shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this Note.
The failure of the Company or the Holder to insist upon strict adherence to any
term of this Note on one or more occasions shall not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Note. Any waiver must be in writing.

 

Section 20.             Severability. If any provision of this Note is invalid,
illegal or unenforceable, the balance of this Note shall remain in effect, and
if any provision is inapplicable to any Person or circumstance, it shall
nevertheless remain applicable to all other Persons and circumstances.

 

Section 21.             Obligations Due on a Business Day. Whenever any payment
or other obligation hereunder shall be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day (or, if such next
succeeding Business Day falls in the next calendar month, the preceding Business
Day in the appropriate calendar month).

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
by an officer duly authorized for such purpose, as of the date first above
indicated.

 

 

MAGELLAN GOLD CORPORATION

 

 

 

By:       /s/ John C. Power

John C. Power, President

 

 

 

 

 

 

 

 

 

 

 

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Accepted this ________________ day of _______________, 2020 by the undersigned,
thereunto duly authorized, in accordance with the terms stated herein.

 

Name of Holder: Gregory Schifrin

 

 

By:     /s/ Gregory Schifrin               

 

 

Tax Identification Number: SS#

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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NOTICE OF CONVERSION

 

(To be Executed by the Registered Holder
in order to Convert the Note)

 

The undersigned hereby irrevocably elects to convert $__________ principal
amount of the Note (defined below) and $___________ in accrued and unpaid
interest due under the Note into shares of common stock, par value $.001 per
share (“Common Stock”), of Magellan Gold Corporation, a Nevada corporation (the
“Company”) according to the conditions of the Unsecured Convertible Note of the
Company (the “Note”), as of the date written below. If securities are to be
issued in the name of a person other than the undersigned, the undersigned will
pay all transfer taxes payable with respect thereto and is delivering herewith
such certificates. No fee will be charged to the Holder for any conversion,
except for transfer taxes, if any. The original certificate evidencing the Note
is delivered herewith (or evidence of loss, theft or destruction thereof).

 

The Company shall electronically transmit the Common Stock issuable pursuant to
this Notice of Conversion to the account of the undersigned or its nominee with
DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”).

 

Name of DTC Prime
Broker:                                                                                                                               

 

Account
Number:                                                                                                                                                

 

In lieu of receiving shares of Common Stock issuable pursuant to this Notice of
Conversion by way of a DWAC Transfer, the undersigned hereby requests that the
Company issue a certificate or certificates for the number of shares of Common
Stock set forth below (which numbers are based on the Holder’s calculation
attached hereto) in the name(s) specified immediately below or, if additional
space is necessary, on an attachment hereto:

 

Name:                                                                                                                                                                    

 

Address:                                                                                                                                                                

 

The undersigned represents and warrants that all offers and sales by the
undersigned of the securities issuable to the undersigned upon conversion of the
Note shall be made pursuant to registration of the securities under the
Securities Act of 1933, as amended (the “Act”), or pursuant to an exemption from
registration under the Act.

 

Date of Conversion:___________________________

 

Applicable Conversion Price:____________________

 

 

Number of Shares of Common Stock to be Issued Pursuant to

Conversion of the Notes:___________________

 

Signature:___________________________________

 

Name:______________________________________

 

Address:____________________________________

 

___________________________________________

 

SS or Tax I.D. No.____________________________

 

The Company shall issue and deliver shares of Common Stock to an overnight
courier not later than three business days following receipt of the original
Note(s) to be converted, and shall make payments pursuant to the Notes for the
number of business days such issuance and delivery is late.

 

 

 

 

 

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