Exhibit 10.2

 

NEITHER THIS DEBENTURE NOR THE SECURITIES UNDERLYING THIS DEBENTURE, NOR ANY
SECURITIES ISSUABLE UPON ITS CONVERSION, IF ANY, HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT’), OR QUALIFIED UNDER APPLICABLE
STATE SECURITIES LAWS AND MAY ONLY BE ACQUIRED FOR INVESTMENT PURPOSES ONLY AND
NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.
THIS DEBENTURE AND THE SECURITIES UNDERLYING THIS DEBENTURE, OR THE SECURITIES
ISSUABLE UPON ITS CONVERSION, IF ANY, MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED
OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO SUCH
SECURITIES UNDER THE ACT AND QUALIFICATION UNDER APPLICABLE STATE LAW WITHOUT AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION AND
QUALIFICATION ARE NOT REQUIRED UNDER THE ACT OR RECEIPT OF A NO- ACTION LETTER
FROM THE SECURITIES AND EXCHANGE COMMISSION.

 

JERRICK MEDIA HOLDINGS, INC.

 

SECURED CONVERTIBLE PROMISSORY NOTE

 

Dated: December    , 2017

(“Issuance Date”)

 

 

FOR VALUE RECEIVED JERRICK MEDIA HOLDINGS, INC., a company organized under the
laws of Nevada (the “Company”), hereby promises to pay to
                       (the “Payee”), or its registered assigns, the principal
amount of                         ($            USD) together with interest
thereon calculated from the Issuance Date (“Interest Commencement Date”) in
accordance with the provisions of this Secured Convertible Promissory Note (as
amended, modified and supplemented from time to time, this “Note” and together
with any other Notes issued in the Note Issuance (as defined below) or upon
transfer or exchange, the “Notes”). Capitalized terms not defined in this Note
shall have the meaning ascribed to them in the Securities Purchase Agreement
dated as of the date hereof.

 

Certain capitalized terms are defined in Section 9 hereof.

 

1. Payment of Interest. Interest shall accrue at a rate equal to
 fifteen percent (15%) per annum (the “Interest Rate”) beginning on the Interest
Commencement Date on the unpaid principal amount of this Note and shall be
payable upon the first anniversary of the Interest Commencement Date in cash and
then quarterly in cash thereafter; provided that so long as any Event of Default
has occurred and is continuing, the interest rate shall increase two percent
(2%) above the current interest rate, and will continue to increase two percent
(2%) above the then effective interest rate after every 30-day period thereafter
in which the Company remains in default of its obligation to pay principal and
interest. In no event shall any interest to be paid under the Notes exceed the
maximum rate permitted by law. In any such event, the Note shall automatically
be deemed amended to permit interest charges at an amount equal to, but not
greater than, the maximum rate permitted by law. Interest shall be computed on
the basis of the actual number of days elapsed and a 360-day year.

 

 -1- 

 

 

2. Maturity Date. The entire principal amount of this Note and all accrued but
unpaid interest thereon shall be due and payable in full in cash in immediately
available funds twenty- four months from the date of issuance (such date, the
“Maturity Date”) upon the tender of such Note by Payee.

 

3. Conversion.

 

(i) The Payee shall have the option to (i) convert this Note and any accrued but
unpaid interest into shares of the Company’s common stock at any time during the
term of the Note or (ii) upon the Maturity Date, tender this Note to the Company
for immediate repayment of principal and accrued and unpaid interest. The number
of shares that shall be issuable upon conversion of the Note shall equal the
number derived by dividing (x) the principal amount of the Note plus any accrued
and unpaid interest thereon by (y) US $0.20 (twenty cents US). No fractional
shares shall be issued upon a conversion. In lieu of any fractional shares to
which Payee would otherwise be entitled, the Company shall pay cash equal to
such fraction multiplied by the Pre-Money Valuation.

 

In order to convert this Note in to Common Stock, the Holder must deliver a
dated and signed notice of conversion (the “Notice of Conversion”), a copy of
which is attached to this Note as Exhibit A, stating its intention to convert
the full principal amount of this Note into Common Stock, Notices of Conversion
shall be deemed delivered on the date sent, if personally delivered, to the
Company’s Chief Executive Officer at the Company’s principal place of business,
or when actually received if sent by another method. The Notice of Conversion
shall be accompanied by the original Note.

 

(ii) As soon as possible after the conversion has been effected (but in any
event within two (2) Business Days), the Company or acquirer shall deliver to
the converting holder a certificate or certificates representing the Common
Stock issuable by reason of such conversion in such name or names and such
denomination or denominations as the converting holder has specified. In the
event that the Payee elects to tender this Note to the Company for immediate
repayment, such payment shall be delivered to the Payee within five (5) business
days to the address provided by the Payee to the Company at the time of the
surrender of this Note.

 

(iii) The issuance of Common Stock upon conversion of this Note shall be made
without charge to the holder hereof in respect thereof or other cost incurred by
the Company or acquirer in connection with such conversion. Upon conversion of
this Note, the Company shall take all such actions as are necessary in order to
ensure that the Company’s common stock issuable upon conversion of the Note
shall be validly issued, fully paid and nonassessable.

 

 -2- 

 

 

(iv) Neither the Company nor acquirer shall close its books against the transfer
of this Note in any manner which interferes with the timely conversion of this
Note. The Company shall assist and cooperate with any holder of this Note
required to make any governmental filings or obtain any governmental approval
prior to or in connection with the conversion of this Note (including, without
limitation, making any filings required to be made by the Company).

 

(v) The Company shall at all times reserve and keep available out of its
authorized but unissued shares of common stock, solely for the purpose of
issuance upon conversion hereunder, such number of shares of common stock
issuable upon conversion. All shares of such capital stock which are so issuable
shall, when issued, be duly and validly issued, fully paid and nonassessable and
free from all taxes, liens and charges. The Company shall take all such actions
as may be necessary to assure that all such shares of capital stock may be so
issued without violation of any applicable law or governmental regulation or any
requirements of any domestic securities exchange upon which such shares of
capital stock.

 

4. Prepayment. The principal amount of this Note may be prepaid, in whole or in
part, after twelve (12) months from the date of issuance at the option of the
Company, together with Interest accrued to the date of prepayment. Any such
prepayment shall be made pro rata based on such Payee’s share of the aggregate
principal amount then owed by the Company to all of the Payees under all the
Notes.

 

In the event of prepayment, in whole or in part, a prepayment penalty rate shall
be assessed as follows:

 

(i) 10% of principal value between months 12 and 18

(ii) 5% of principal value between months 19 and 24

 

5. Seniority. This Note is secured indebtedness of the Company and shall be
secured by a second priority lien on all the assets of the Company and its
subsidiaries, second only to the existing note payable to Arthur Rosen in an
amount not to exceed $1,000,000; subject to a carve out for a traditional
revolving credit facility secured by receivables with a maximum borrowing
capacity of $1,000,000, whether now or hereinafter existing except as otherwise
stated herein.

 

6. Method of Payments.

 

(i) Payment. So long as the Payee or any of its nominees shall be the holder of
any Note, and notwithstanding anything contained elsewhere in this Note to the
contrary, the Company will pay all sums for principal, interest, or otherwise
becoming due on this Note held by the Payee or such nominee not later than 1:00
p.m. New York time, on the date such payment is due, in immediately available
funds, in accordance with the payment instructions that the Payee may designate
in writing, without the presentation or surrender of such Note or the making of
any notation thereon. Any payment made after 1:00 p.m. New York time, on a
Business Day will be deemed made on the next following Business Day. If the due
date of any payment in respect of this Note would otherwise fall on a day that
is not a Business Day, such due date shall be extended to the next succeeding
Business Day, and interest shall be payable on any principal so extended for the
period of such extension. All amounts payable under this Note shall be paid free
and clear of, and without reduction by reason of, any deduction, set-off or
counterclaim. The Company will afford the benefits of this Section to the Payee
and to each other Person holding this Note.

 

 -3- 

 

 

(ii) Transfer and Exchange. Upon surrender of any Note for registration of
transfer or for exchange to the Company, in accordance with the terms hereof, at
its principal office, the Company at its sole expense will execute and deliver
in exchange therefor a new Note or Notes, as the case may be, as requested by
the holder or transferee, which aggregate principal amount is equal the unpaid
principal amount of such Note, registered as such holder or transferee may
request, dated so that there will be no loss of interest on the Note and
otherwise of like tenor; provided that this Note may not be transferred by Payee
to any Person other than Payee’s affiliates without the prior written consent of
the Company (which consent shall not be unreasonably withheld or delayed). The
issuance of new Notes shall be made without charge to the holder(s) of the
surrendered Note for any issuance tax in respect thereof or other cost incurred
by the Company in connection with such issuance, provided that each Noteholder
shall pay any transfer taxes associated therewith. The Company shall be entitled
to regard the registered holder of this Note as the holder of the Note so
registered for all purposes until the Company or its agent, as applicable, is
required to record a transfer of this Note on its register.

 

(iii) Replacement. Upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of any Note and, in the
case of any such loss, theft or destruction of any Note, upon receipt of an
indemnity reasonably satisfactory to the Company or, in the case of any such
mutilation, upon the surrender and cancellation of such Note, the Company, at
its expense, will execute and deliver, in lieu thereof, a new Note of like tenor
and dated the date of such lost, stolen, destroyed or mutilated Note.

 

7. Covenants of the Company. The Company covenants and agrees as follows:

 

(i) Consolidation, Merger and Sale. With the exception of a reverse merger
transaction, the Company will not sell or otherwise dispose of (or permit any
subsidiary to sell or otherwise dispose of) a material portion of its property
or assets in one or more transactions for so long as any of the Notes remain
outstanding.

 

(ii) Use of Proceeds. The Company shall use the proceeds for general working
capital purposes and will broad discretion with respect to the allocation of
these funds.

 

 -4- 

 

 

 

8. Events of Default. If any of the following events take place before or on the
Maturity Date (each, an “Event of Default”), Payee at its option may declare all
principal and accrued and unpaid interest thereon and all other amounts payable
under this Note immediately due and payable; provided, however, that this Note
shall automatically become due and payable without any declaration in the case
of an Event of Default specified in clause (iii) or (v), below:

 

  (i) Company fails to make payment of the full amount due under this Note upon
the tender of such Note following the Maturity Date; or

 

  (ii) A receiver, liquidator or trustee of Company or any substantial part of
Company’s assets or properties is appointed by a court order; or

 

  (iii) Company is adjudicated bankrupt or insolvent; or

 

  (iv) Any of Company’s property is sequestered by or in consequence of a court
order and such order remains in effect for more than 30 days; or

 

  (v) Company files a petition in voluntary bankruptcy or requests
reorganization under any provision of any bankruptcy, reorganization or
insolvency law or consents to the filing of any petition against it under such
law, or

 

  (vi) Proceedings for the appointment of a receiver, trustee or custodian of
the Company or of all or a substantial part of the assets or property thereof,
or an involuntary case or other proceedings seeking liquidation, reorganization
or other relief with respect to the Company or the debts thereof under any
bankruptcy, insolvency or other similar law now or hereafter in effect shall be
commenced and an order for relief entered or such proceeding shall not be
dismissed or discharged within sixty (60) days of commencement.

 

  (vii) Company makes a formal or informal general assignment for the benefit of
its creditors, or admits in writing its inability to pay debts generally when
they become due, or consents to the appointment of a receiver or liquidator of
Company or of all or any part of its property; or

 

  (viii) An attachment or execution is levied against any substantial part of
Company’s assets that is not released within 30 days; or

 

  (ix) Company dissolves, liquidates or ceases business activity, or transfers
any major portion of its assets other than in the ordinary course of business;
provided that this paragraph (ix) shall not apply to any contemplated real
estate transaction; or

 

 -5- 

 

 

  (x) Company breaches any covenant or agreement on its part contained in this
Note or the Securities Purchase Agreement; or

 

  (xi) Any material inaccuracy or untruthfulness of any representation or
warranty of the Company set forth in this Note, the Securities Purchase
Agreement or other offering documents, schedules and exhibits related thereto.

 

9. Definitions.

 

“Business Day” means a day (other than a Saturday or Sunday) on which banks
generally are open in New York, New York for the conduct of substantially all of
their activities.

 

“Noteholder” or “Payee” with respect to any Note, means at any time each Person
then the record owner hereof and “Noteholders” or “Payees” means all of such
Noteholders or Payees, collectively.

 

“Note Issuance” or “Offering” shall mean the Secured Convertible Promissory
Notes issued by the Company to the Payee and other Noteholders (each in
substantially the form of this Note) in the original principal amount not to
exceed $6,000,000 in the aggregate.

 

“Person” means any person or entity of any nature whatsoever, specifically
including an individual, a firm, a company, a corporation, a partnership, a
limited liability company, a trust or other entity.

 

“Securities Purchase Agreement” means the Securities Purchase Agreement, dated
December 2017 between the Company and the Payee.

 

10. Expenses of Enforcement, etc. The Company agrees to pay all reasonable fees
and expenses incurred by the Payee in connection with any amendments,
modifications, waivers, extensions, renewals, renegotiations or “workouts” of
the provisions hereof or incurred by the Payee in connection with the
enforcement or protection of its rights in connection with this Note, or in
connection with any pending or threatened action, proceeding, or investigation
relating to the foregoing, including but not limited to the reasonable fees and
disbursements of counsel for the Payee. The Company indemnifies the Payee and
its directors, managers, affiliates, partners, members, officers, employees and
agents against, and agrees to hold the Payee and each such person and/or entity
harmless from, any and all losses, claims, damages, liabilities and related
expenses, including reasonable counsel fees and expenses, incurred by or
asserted against the Payee or any such person and/or entity arising out of, in
any way connected with, or as a result of (i) the consummation of the loan
evidenced by this Note and the use of the proceeds thereof or (ii) any claim,
litigation, investigation or proceedings relating to any of the foregoing,
whether or not the Payee or any such person and/or entity is a party thereto
other than any loss, claim, damage, liability or related expense incurred or
asserted against the payee or any such person on account of the payee’s or such
person’s gross negligence or willful misconduct. Notwithstanding the foregoing,
with respect to the indemnification obligations of the Company hereunder, (i)
the Company’s aggregate liability under this Note to the Payee shall not exceed
the aggregate principal amount of the Note and all accrued and unpaid interest
thereon and (ii) indemnified liabilities shall not include any liability of any
indemnitee arising out of such indemnitee’s gross negligence. To the extent that
the foregoing undertaking by the Company may be unenforceable for any reason,
the Company shall make the maximum contribution to the payment and satisfaction
of each of the indemnified liabilities which is permissible under applicable
law.

 

 -6- 

 

 

11. Security Interest.

 

(i) Creation of Security Interest. In order to secure the payment of the
principal and interest and all other obligations of the Company hereunder now or
hereafter owed by the Company to Payee (the “Secured Obligations”), the Company
hereby grants to Payee (or its designee) (the “Secured Party”) a second priority
security interest (the “Security Interest”) in the property of the Company
described below (the “Collateral”) on the terms and conditions set forth in this
Note second only to the existing note payable to Arthur Rosen in an amount not
to exceed $1,000,000:

 

(a) all intellectual property of any kind or nature whatsoever, including
without limitation patents, patent applications, copyrights, copyright
applications, trademarks and service marks and applications therefore, mask
works, net lists and trade secrets;

 

(b) all substitutes and replacements for, accessions, attachments, and other
additions to, and all proceeds, products, and increases of, any and all of the
foregoing Collateral, in whatever form, whether cash or noncash; interest,
premium, and principal payments, redemption proceeds and subscription rights,
and shares or other proceeds of conversions or splits of any securities in
Collateral, and returned or repossessed Collateral; and, to the extent not
otherwise included, all (A) payments under insurance, or any indemnity, warranty
or guaranty, payable by reason of loss or damage to or otherwise with respect to
any of the foregoing Collateral, (B) cash and (C) security for the payment of
any of the Collateral, and all goods which gave or will give rise to any of the
Collateral or are evidenced, identified, or represented therein or thereby.

 

(ii) Sale or Removal of Collateral Prohibited. Except for the sale of inventory
in the ordinary course of the Company’s business, the Company shall not sell,
lease, encumber, pledge, mortgage, assign, grant a security interest in, or
otherwise transfer the Collateral without the written consent of Payee, which
consent shall not be unreasonably withheld.

 

(iii) Uniform Commercial Code Security Agreement. This Section is intended to be
a security agreement pursuant to the Uniform Commercial Code for any of the
items specified above as part of the Collateral which, under applicable law, may
be subject to a security interest pursuant to the Uniform Commercial Code, and
the Company hereby grants Payee a security interest in said items. The Company
agrees that Payee may file any appropriate document in the appropriate index or
filing office as a financing statement for any of the items specified above as
part of the Collateral and the Company shall reimburse Payee for all fees and
expenses associated with such filing. In addition, the Company agrees to execute
and deliver to Payee, upon Payee’s request, any financing statements, as well as
extensions, renewals and amendments thereof, and reproductions of this Agreement
in such form as Payee may reasonably require to perfect a security interest with
respect to said items. The Company shall pay all costs of filing such financing
statements and any extensions, renewals, amendments, and releases thereof, and
shall pay all reasonable costs and expenses of any record searches for financing
statements Payee may reasonably require. Without the prior written consent of
Payee, the Company shall not create or suffer to be created pursuant to the
Uniform Commercial Code any other security interest in the Collateral, other
than the Security Interests of Secured Party, including replacements and
additions thereto. Upon the occurrence of an Event of Default, each Secured
Party shall have the remedies of a Payee under the Uniform Commercial Code and,
at Secured Party’s option, may also invoke the other remedies provided in this
Note as to such items. In exercising any of said remedies, Secured Party may
proceed against the items of real property and any items of personal property
specified above as part of the Collateral separately or together and in any
order whatsoever, without in any way affecting the availability of Secured
Party’s remedies under the Uniform Commercial Code or of the other remedies
provided in this Agreement.

 

 -7- 

 

 

(iv) Rights of Secured Party. Upon an Event of Default, Secured Party may
require the Company to assemble the Collateral and make it available to Secured
Party at the place to be designated by Secured Party which is reasonably
convenient to the parties. Secured Party may sell all or any part of the
Collateral as a whole or in parcels either by public auction, private sale, or
other method of disposition. Secured Party may bid at any public sale on all or
any portion of the Collateral. Unless the Collateral is perishable or threatens
to decline speedily in value or is of the type customarily sold on a recognized
market, Secured Party shall give the Company reasonable notice of the time and
place of any public sale or of the time after which any private sale or other
disposition of the Collateral is to be made, and notice given at least 10 days
before the time of the sale or other disposition shall be conclusively presumed
to be reasonable. A public sale in the following fashion shall be conclusively
presumed to be reasonable:

 

(a) Notice shall be given at least 10 days before the date of sale by
publication once in a newspaper of general circulation published in the county
in which the sale is to be held;

 

(b) The sale shall be held in a county in which the Collateral or any part is
located or in a county in which the Company has a place of business;

 

(c) Payment shall be in cash or by certified check immediately following the
close of the sale;

 

(d) The sale shall be by auction, but it need not be by a professional
auctioneer; and

 

(e) The Collateral may be sold as is and without any preparation for sale.

 

(v) Notwithstanding any provision of this Agreement, Secured Party shall be
under no obligation to offer to sell the Collateral. In the event Secured Party
offer to sell the Collateral, Secured Party will be under no obligation to
consummate a sale of the Collateral if, in their reasonable business judgment,
none of the offers received by them reasonably approximates the fair value of
the Collateral.

 

 -8- 

 

 

 

(vi) In the event Secured Party elects not to sell the Collateral, Secured Party
may elect to follow the procedures set forth in the Uniform Commercial Code for
retaining the Collateral in satisfaction of the Company’s obligation, subject to
the Company’s rights under such procedures.

 

(vii) In addition to the rights under this Agreement, in the Event of Default by
the Company, Secured Party shall be entitled to the appointment of a receiver
for the Collateral as a matter of right whether or not the apparent value of the
Collateral exceeds the outstanding principal amount of the Notes and any
receiver appointed may serve without bond. Employment by Secured Party shall not
disqualify a person from serving as receiver.

 

(viii) Additional Rights of Secured Party. The Company shall execute and deliver
to Secured Party concurrently with the Company’s execution and delivery of this
Agreement and at any time thereafter at the reasonable request of Secured Party,
all financing statements, continuation financing statements, fixture filings,
security agreements, mortgages, pledges, assignments, endorsements of
certificates of title, applications for title, affidavits, reports, notices,
schedules of accounts, letters of authority, and all other documents that
Secured Party may reasonably request, in form reasonably satisfactory to Secured
Party, to perfect and maintain perfected Secured Party’s continuing security
interests in the Collateral and in order to fully consummate all of the
transactions contemplated under the Offering Documents, the Company hereby
authorizes Secured Party to file and/or record such financing statements and
other documents as Secured Party deems reasonably necessary to perfect and
maintain Secured Party’s continuing security interest in the Collateral,
including, but not limited to, any and all filings recognized by the United
States Patent and Trademark Office for the purposes of perfecting a security
interest in any Collateral that is considered intellectual property of the
Company. The Company agree any such financing statements may contain an “all
asset” or “all property” description of the Collateral.

 

(ix) The Security Interest shall terminate when all the Secured Obligations have
been fully and indefeasibly paid in full, at which time all Uniform Commercial
Code termination statements and similar documents which the Company shall
reasonably request to evidence such termination shall be executed.

 

 -9- 

 

 

12. Amendment and Waiver. The provisions of this Note may not be modified,
amended or waived, and the Company may not take any action herein prohibited, or
omit to perform any act herein required to be performed by it, without the
written consent of the holder.

 

13. Anti-Dilution Rights. For so long as the Notes are outstanding, if the
Corporation issues shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock, except for Excepted Issuances (as
defined below), for a consideration at a price per share, or having a
conversion, exchange or exercise price per share less than the Conversion Price
of the Note immediately in effect prior to such sale or issuance, then
immediately prior to such sale or issuance the Conversion Price of the Note
shall be reduced to such other lower price. For purposes of this adjustment, the
issuance of any security carrying the right to convert such security directly or
indirectly into shares of Common Stock or of any warrant, right or option to
purchase Common Stock shall result in an adjustment to the Conversion Price upon
the issuance of the above described security and again upon the issuance of
shares of Common Stock upon exercise of such conversion or purchase rights if
such issuance is at a price lower than the then applicable Conversion Price.
Excepted Issuances means: (i) Company's issuance of Common Stock in full or
partial consideration in connection with a strategic merger, acquisition,
consolidation or purchase of substantially all of the securities or assets of a
corporation or other entity, so long as such issuances are not for the purpose
of raising capital and which holders of such securities or debt are not at any
time granted registration rights, (ii) the Company's issuance of securities in
connection with strategic license agreements and other partnering arrangements,
so long as such issuances are not for the purpose of raising capital and which
holders of such securities or debt are not at any time granted registration
rights, (iii) the Company's issuance of Common Stock or the issuances or grants
of options to purchase Common Stock to employees, directors, and consultants,
pursuant to employee stock option plans, (iv) securities upon the exercise or
exchange of or conversion of any securities exercisable or exchangeable for or
convertible into shares of Common Stock issued and outstanding as of the date
hereof.

 

14. Remedies Cumulative. No remedy herein conferred upon the Payee is intended
to be exclusive of any other remedy and each and every such remedy shall be
cumulative and shall be in addition to every other remedy given hereunder or now
or hereafter existing at law or in equity or by statute or otherwise.

 

15. Remedies Not Waived. No course of dealing between the Company and the Payee
or any delay on the part of the Payee in exercising any rights hereunder shall
operate as a waiver of any right of the Payee.

 

 -10- 

 

 

16. Assignments. The Payee may assign, participate, transfer or otherwise convey
this Note and any of its rights or obligations hereunder or interest herein to
any affiliate of Payee and to any other Person that the Company consents to
(such consent not to be unreasonably withheld or delayed), and this Note shall
inure to the benefit of the Payee’s successors and assigns. The Company shall
not assign or delegate this Note or any of its liabilities or obligations
hereunder.

 

17. Headings. The headings of the sections and paragraphs of this Note are
inserted for convenience only and do not constitute a part of this Note.

 

18. Severability. If any provision of this Note is held invalid or unenforceable
by any court of competent jurisdiction, the other provisions of this Note will
remain in full force and effect. Any provision of this Note held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.

 

19. Cancellation. After all principal, premiums (if any) and accrued interest at
any time owed on this Note have been paid in full, or this Note has been
converted this Note will be surrendered to the Company for cancellation and will
not be reissued.

 

20. Maximum Legal Rate. If at any time an interest rate applicable hereunder
exceeds the maximum rate permitted by law, such rate shall be reduced to the
maximum rate so permitted by law.

 

21. Place of Payment and Notices. Unless otherwise stated herein, payments of
principal and interest are to be delivered to the Noteholder of this Note at the
address provided by the Payee in the Note Securities Purchase Agreement, or at
such other address as such Noteholder has specified by prior written notice to
the Company. No notice shall be deemed to have been delivered until the first
Business Day following actual receipt thereof at the foregoing address.

 

22. Waiver of Jury Trial. The Payee and the Company each hereby waives any right
it may have to a trial by jury in respect of any litigation directly or
indirectly arising out of, under or in connection with this Note and/or the
transactions contemplated hereunder.

 

23. Submission to Jurisdiction.

 

(i) Any legal action or proceeding with respect to this Note may be brought in
the courts of the State of New Jersey or of the United States of America sitting
in New Jersey, and, by execution and delivery of this Note, the Company hereby
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts.

 

(ii) The Company hereby irrevocably waives, in connection with any such action
or proceeding, any objection, including, without limitation, any objection to
the laying of venue or based on the grounds of forum non conveniens, which they
may now or hereafter have to the bringing of any such action or proceeding in
such respective jurisdictions.

 

(iii) Nothing herein shall affect the right of the Payee to serve process in any
other manner permitted by law or to commence legal proceedings or otherwise
proceed against the Company in any other jurisdiction.

 

24. GOVERNING LAW. ALL ISSUES AND QUESTIONS CONCERNING THE CONSTRUCTION,
VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS SECURED NOTE SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW JERSEY,
WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW RULES OR
PROVISIONS (WHETHER OF THE STATE OF NEW JERSEY OR ANY OTHER JURISDICTION) THAT
WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE
OF NEW JERSEY.

 

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 -11- 

 

 

IN WITNESS WHEREOF, the Company has executed and delivered this Secured
Convertible Promissory Note on the date first written above.

 

  COMPANY:       JERRICK MEDIA HOLDINGS, INC.         By:       Jeremy Frommer  
  Chief Executive Officer

 

 -12- 

 

 

EXHIBIT A

 

NOTICE OF CONVERSION

 

(To Be Signed Only Upon Conversion of the Secured Convertible Promissory Note)

 

The undersigned, the holder of the foregoing Secured Convertible Promissory
Note, hereby surrenders such Note for conversion into shares of Common Stock of
Jerrick Media Holdings, Inc. to the extent of $                               
unpaid principal amount and any accrued and unpaid interest of such Note, and
requests that the certificates for such shares be issued in the name of, and
delivered to:

 

  Name:               Address                                                  
 

 

Dated:               /               / 20     

 

      (Signature must conform in all respects to name of holder as specified on
the face of the Debenture)               (Address)

 

 -13-