Exhibit 10.2


 


NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE 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 AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS
SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR OTHER LOAN SECURED BY SUCH SECURITIES.


 


Original
Issue Date: October __, 2019


 


	Principal Amount:  	$_______________
	Purchase Price:	$_______________


 


ORIGINAL
ISSUE DISCOUNT SENIOR

CONVERTIBLE PROMISSORY NOTE

DUE OCTOBER __, 2020


 


THIS
ORIGINAL ISSUE DISCOUNT SENIOR CONVERTIBLE PROMISSORY NOTE is a duly authorized and validly issued Original Issue Discount Senior
Convertible Promissory Note of Uppercut Brands Inc., a Delaware corporation (the “Company” or the “Borrower”),
having its principal place of business at 1086 Teaneck Road, Suite 3A, Teaneck, New Jersey 07666, designated as its Original Issue
Discount Senior Convertible Promissory Note due October 11, 2020 (the “Note”).


 


FOR
VALUE RECEIVED, the Company promises to pay to ___________ or its registered assigns (as permitted in the Transaction Documents)
(the “Holder”), or shall have paid pursuant to the terms hereunder, the principal sum of $_________ on October
__, 2020 (the “Maturity Date”), or such earlier date as this Note is required or permitted to be repaid as provided
hereunder, and to pay interest to the Holder on the aggregate unconverted and then-outstanding principal amount of this Note in
accordance with the provisions hereof. This Note is subject to the following additional provisions:


 


Section
1. Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Note, (a) capitalized terms
not otherwise defined herein shall have the meanings set forth in the Purchase Agreement and (b) the following terms shall have
the following meanings:


 


“Alternate
Consideration” shall have the meaning set forth in Section 5(e).


 


“Bankruptcy
Event” means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in Rule
l-02(w) of Regulation S-X) thereof commences a ease or other proceeding under any bankruptcy, re organization, arrangement, adjustment
of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the Company or
any Significant Subsidiary thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof any such case
or proceeding that is not dismissed within 60 days after commencement, (c) the Company or any Significant Subsidiary thereof is
adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or proceeding is entered, (d) the
Company or any Significant Subsidiary thereof suffers any appointment of any custodian or the like for it or any substantial part
of its property that is not discharged or stayed within sixty (60) calendar days after such appointment, (e) the Company or any
Significant Subsidiary thereof makes a general assignment for the benefit of creditors, (f) the Company or any Significant Subsidiary
thereof calls a meeting of its creditors with a view to arranging a composition, adjustment or restructuring of its debts, or (g)
the Company or any Significant Subsidiary thereof, by any act or failure to act, expressly indicates its consent to, approval of
or acquiescence in any of the foregoing or takes any corporate or other action for the purpose of effecting any of the foregoing.


 



    1


     


    

 


“Base
Conversion Price” shall have the meaning set forth in Section 5(b):


 


“Beneficial
Ownership Limitation” shall have the meaning set forth in Section 4(d).


 


Business
Day” means any day except any Saturday, any Sunday, any day that is a federal legal holiday in the United States or any
day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.


 


“Buy-In”
shall have the meaning set forth in Section 4(c)(v).


 


“Change
of Control Transaction” means the occurrence after the date hereof of any of (a) an acquisition after the date hereof
by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of
effective control (whether through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of
in excess of one-third (1/3) of the voting securities of the Company (other than by means of conversion or exercise of the Note
and the Securities issued together with die Note), (b) the Company merges into or consolidates with any other Person, or any Person
merges into or consolidates with the Company and, after giving effect to such transaction, the stockholders of the Company immediately
prior to such transaction own less than two-thirds (2/3) of the aggregate voting power of the Company or the successor entity of
such transaction, (c) the Company sells or transfers all or substantially all of its assets to another Person and the stockholders
of the Company immediately prior to such transaction own less than two-thirds (2/3) of the aggregate voting power of the acquiring
entity immediately after the transaction, (d) a replacement at one time or within a three-year period of more than one- half of
the members of the Board of Directors that is not approved by a majority of those individuals who are members of the Board of Directors
on the Original Issue Date (or by those individuals who are serving as members of the Board of Directors on any date whose nomination
to the Board of Directors was approved by a majority of the members of the Board of Directors who are members on the date hereof),
or (e) the execution by the Company of an agreement to which the Company is a party or by which it is bound, providing for any
of the events set forth in clauses (a) through (d), above.


 


“Conversion”
shall have the meaning ascribed to such term in Section 4,


 


“Conversion
Date” shall have the meaning set forth in Section 4(a).


 


“Conversion
Price” shall have the meaning set forth in Section 4(b).


 


“Conversion
Schedule” means the Conversion Schedule in the form of Schedule 1 attached hereto.


 


“Conversion
Shares” means, collectively, the shares of Common Stock issuable upon conversion of this Note in accordance with the
terms hereof.


 



    2


     


    

 


“Dilutive
Issuance” shall have the meaning set forth in Section 5(b).


 


“Dilutive
Issuance Notice” shall have the meaning set forth in Section 5(b).


 


“DTC”
means The Depository Trust Company.


 


“DTC/FAST
Program” means the DTC’s Fast Automated Securities Transfer Program.


 


“DWAC”
means Deposit and Withdrawal at Custodian system, as defined by DTC.


 


“DWAC
Eligible” means that (a) the Common Stock is eligible at DTC for full services pursuant to DTC’s Operational Arrangements,
including without limitation transfer through DTC’s DWAC system, (b) the Company has been approved (without revocation) by
DTC’s underwriting department, (c) the Transfer Agent is approved as an agent in the DTC/FAST Program, (d) the Conversion
Shares are otherwise eligible for delivery via DWAC, and (e) the Transfer Agent does not have a policy prohibiting or limiting
delivery of the Conversion Shares via DWAC.


 


“Equity
Conditions” means, during the period in question, (a) the Company shall have duly honored all conversions and redemptions
scheduled to occur or occurring by virtue of one or more Notices of Conversion of the Holder, if any, (b) the Company shall have
paid all liquidated damages and other amounts owing to the Holder in respect of this Note, (c) all of the Conversion Shares issuable
pursuant to the Transaction Documents (and shares issuable in lieu of cash payments of interest) may be resold pursuant to Rule
144 without volume or manner-of-sale restrictions or current public information requirements as determined by the counsel to the
Company as set forth in a written opinion letter to such effect, addressed and acceptable to the Transfer Agent and the Holder,
(d) the Common Stock is trading on a Trading Market and all of the shares issuable pursuant to the Transaction Documents are listed
or quoted for trading on such Trading Market (and the Company believes, in good faith, that trading of the Common Stock on a Trading
Market will continue uninterrupted for the foreseeable future), (e) there is a sufficient number of authorized but unissued and
otherwise unreserved shares of Common Stock for the issuance of all of the shares then issuable pursuant to the Transaction Documents,
(f) there is no existing Event of Default and no existing event that, with the passage of time or the giving of notice, would constitute
an Event of Default, (g) the issuance of the shares in question to the Holder would not violate the limitations set forth in Section
4(d) herein, (h) there has been no public announcement of a pending or proposed Fundamental Transaction or Change of Control Transaction
that has not been consummated, (i) the applicable Holder is not in possession of any information provided by the Company that constitutes,
or may constitute, material non-public information, (j) for each Trading Day in a period of twenty (20) consecutive Trading Days
prior to the applicable date in question, the daily dollar trading volume for the Common Stock on the principal Trading Market
exceeds $400,000.00 per Trading Day, and (k) the Company’s Common Stock must be DWAC Eligible.


 


“Event
of Default” shall have the meaning set forth in Section 6(a).


 


“Fundamental
Transaction” shall have the meaning set forth in Section 5(e).


 


“Late
Fees” shall have the meaning set forth in Section 2(c).


 


“Make-Whole
Amount” means, with respect to the applicable date of determination, an amount in cash equal to all of the interest that,
but for the applicable conversion or default payment, would have accrued pursuant to Section 2 with respect to the applicable principal
amount being so converted or redeemed for the period commencing on the applicable redemption date or Conversion Date or default
payment date and ending on October 11, 2020.


 



    3


     


    

 


“Mandatory
Default Amount” means either, at the Holder’s discretion, (i) the conversion of the outstanding principal amount
of this Note, plus all accrued and unpaid interest hereon, converted at the Conversion Price or (ii) the payment 135% of the outstanding
principal amount of this Note and accrued and unpaid interest hereon, in addition to, for both (i) and (ii), above, the payment
of all other amounts, costs, expenses and liquidated damages due in respect of this Note.


 


“New
York Courts” shall have the meaning set forth in Section 7(d).


 


“Note
Register” shall have the meaning set forth in Section 2(b).


 


“Note
Reserved Shares” shall have the meaning set forth in Section 4(c)(vi).


 


“Notice
of Conversion” shall have the meaning set forth in Section 4(a).


 


“Original
Issue Date” means the date of the first issuance of the Note, regardless of any transfers of any Note, regardless of
the number of Closings, and regardless of the number of instruments that may be issued to evidence such Note.


 


“Permitted
Indebtedness” means the indebtedness evidenced by the Note.


 


“Permitted
lien” means the individual and collective reference to the following: (a) Liens for taxes, assessments, and other
governmental charges or levies not yet due or Liens for taxes, assessments, and other governmental charges or levies being contested
in good faith and by appropriate proceedings for which adequate reserves (in the good faith judgment of the management of the Company)
have been established in accordance with GAAP, (b) Liens imposed by law that were incurred in the ordinary’ course of the
Company’s business, such as carriers’, warehousemen’s and mechanics’ Liens, statutory landlords’
Liens, and other similar Liens arising in the ordinary course of the Company’s business, and that (x) do not individually
or in the aggregate materially detract from the value of such property or assets or materially impair the use thereof in the operation
of the business of the Company and its consolidated Subsidiaries or (y) are being contested in good faith by appropriate proceedings,
which proceedings have the effect of preventing for die foreseeable future the forfeiture or sale of the property or asset subject
to such Lien, (c) all Liens that are currently in existence as disclosed on Schedule 3.1(n) of the Purchase Agreement, (d) Liens
incurred in connection with Permitted Indebtedness; and (e) the Liens listed on Disclosure Schedules.


 


“Purchase
Agreement” means the Securities Purchase Agreement, dated as of October 11, 2019, among the Company and the original
Holders, as amended, modified, or supplemented from time to time in accordance with its terms.


 


“Reserved
Shares” means the sum of (x) the Note Reserved Shares and (y) the aggregate number of shares of Common Stock required
for issuance pursuant to the terms and conditions set forth in the Warrant.


 


“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.


 


“Share
Delivery Date” shall have the meaning set forth in Section 4(c)(ii).


 


“Successor
Entity” shall have the meaning set forth in Section 5(e).


 


“Trading
Day” means a day on which the principal Trading Market is open for trading.


 



    4


     


    

 


“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on
the date in question: the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock
Exchange, the NYSE American, the OTC Bulletin Board, or the OTC Markets Group Inc.’s OTCQX®, OTCQB®,
or OTC Pink® marketplaces (or any successors to any of the foregoing).


 


“Transaction
Documents” means the Purchase Agreement, this Note, the Warrant, and any other documents or written agreements in connection
with the transactions contemplated by such documents.


 


“Transfer
Agent” shall have the meaning set forth in the Purchase Agreement.


 


“Warrant”
means that certain Common Stock Purchase Warrant, of even date herewith, granted by the Company to the initial Holder.


 


Section
2. Interest; Fees; Prepayment.


 


a)
Interest. Prior to an Event of Default no interest shall accrue on this Note.


 


b)
Payment of Interest in Cash or Kind. Interest shall be payable on each Conversion Date (as to that principal amount
then being converted) or the Maturity Date, as applicable, in cash or in duly authorized, validly issued, fully paid, and non-assessable
shares of Common Stock or a combination thereof, at the Company’s option; provided, however, that in the event
that all of the Equity Conditions are not met on that certain Conversion Date or Maturity Date, as applicable, such payment in
cash or Common Stock or combination thereof shall be at the Holder’s option. Payment of interest in shares of Common Stock
shall otherwise occur pursuant to Section 4(c)(ii) herein. Interest hereunder will be paid to the Person in whose name this Note
is registered on the records of the Company regarding registration and transfers of this Note (the “Note Register”).
Except as otherwise provided herein, if at any time the Company pays interest partially in cash and partially in shares of Common
Stock to the holder of the Note, then such payment of cash shall be distributed ratably among the holders of the then-outstanding
Note based on their (or their predecessor’s) initial purchases of Note pursuant to the Purchase Agreement.


 


c)
Late Fee. All overdue accrued and unpaid interest to be paid hereunder shall entail a late fee at an interest rate
equal to the lesser of eighteen percent (18%) per annum or the maximum rate permitted by applicable law (the “Late Fees”)
that shall accrue daily from the date such interest is due hereunder through and including the date of actual payment in full.


 


d)
Conversion-related Fees. Concurrently with each conversion, the Company shall cause to be delivered to the Holder
that number of Conversion Shares that is equivalent to $1,250.00 at the then-Conversion Price, such Conversion Shares’ value
to be in lieu of the Holder requiring the Company to tender funds to the Holder for its brokerage expenses in connection with such
conversion.


 


e)
Prepayment. At any time within 180 days of the date of issuance of this Note, upon ten (10) days’ prior written
notice to the Holder, the Company may prepay any portion of the principal amount of this Note and the relevant portion of the interest
thereon. If the Borrower exercises its right to prepay the Note, the Borrower shall make payment to the Holder of an amount in
cash equal to the sum of the then-outstanding principal amount of this Note then being pre-paid and the then-accrued and unpaid
interest as of such payment date multiplied by (i) one hundred ten percent (110%) if the prepayment is received at any time on
the Original Issue Date through and including 6:00 p.m. New York time on the sixtieth (60th) day after the Original
Issue Date; (ii) one hundred twenty percent (120%) if the prepayment is received at any time from and after 6:00:01 p.m. New York
time on the sixtieth (60th) day after the Original Issue Date through and including 6:00 p.m. New York time on the one
hundred twentieth (120th) day after the Original Issue Date; and one hundred thirty percent (130%) if the prepayment
is received at any time from and after 6:00:01 p.m. New York time on the one hundred twentieth (120th) day after the
Original Issue Date through and including 6:00 p.m. New York time on the one hundred eightieth (180th) day after the
Original Issue Date. The Holder may continue to convert the Note, in whole or in part, from the date notice of the prepayment is
given until the date on which the Holder has received such prepayment, at which time the Holder may no longer convert such “prepaid
portion.”.


 



    5


     


    

 


Section
3. Registration of Transfers and Exchanges.


 


a)
Different Denominations. This Note is exchangeable for an equal aggregate principal amount of Notes of different
authorized denominations, as requested by the Holder surrendering the same. No service charge will be payable for such registration
of transfer or exchange.


 


b)
Investment Representations. This Note has been issued subject to certain investment representations of the original
Holder set forth in the Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and
applicable federal and state securities laws and regulations.


 


c)
Reliance on Note Register. Prior to due presentment for transfer to the Company 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 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 is overdue, and neither
the Company nor any such agent shall be affected by notice to the contrary.


 


Section
4. Conversion.


 


a)
Voluntary Conversion. At any time after the Original Issue Date until this Note is no longer outstanding, this Note shall
be convertible, in whole or in part, into shares of Common Stock at the option of the Holder, at any time and from time to time
(subject to the conversion limitations set forth in Section 4(d) hereof). The Holder shall effect conversions by delivering to
the Company a Notice of Conversion, the form of which is attached hereto as Annex A (each, a “Notice of Conversion”),
specifying therein the principal amount of this Note to be converted and the date on which such conversion shall be effected (such
date, the “Conversion Date”). If no Conversion Date is specified in a Notice of Conversion, the Conversion Date
shall be the date that such Notice of Conversion is deemed delivered hereunder. No ink-original Notice of Conversion shall be required,
nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Conversion form be required. To
effect conversions hereunder, the Holder shall not be required physically to surrender this Note to the Company unless the entire
principal amount of this Note, plus all accrued and unpaid interest thereon, has been so converted. Conversions hereunder shall
have the effect of lowering the outstanding principal amount of this Note in an amount equal to the applicable conversion. The
Holder and the Company shall maintain records showing the principal amount(s) converted and the date of such conversion(s). The
Company may deliver an objection to any Notice of Conversion within one (1) Business Day of delivery of such Notice of Conversion.
In the event of any dispute or discrepancy, the records of the Holder shall be controlling and determinative in the absence of
manifest error. The Holder, and any assignee by acceptance of this Note, acknowledge and agree that, by reason of the provisions
of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted principal amount of this Note may
be less than the amount stated on the face hereof. Upon every Conversion, the Company shall deliver an additional $1,000 worth
of shares (as calculated by the Conversion Price in effect on the Conversion Notice being honored) to cover the Holder’s
expenses and deposit fees associated with each Notice of Conversion.


 



    6


     


    

 


b)
Conversion Price. The conversion price in effect on any Conversion Date shall be $0.20 (the “Conversion
Price”), subject to amendment as set forth herein. Notwithstanding anything herein to the contrary, at any time after
the occurrence of any Event of Default, the Holder may require the Company to, at such Holder’s option and otherwise in accordance
with the provisions for conversion herein, convert all or any part of this Note into Common Stock at the Conversion Price. All
such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification, or similar
transaction that proportionately decreases or increases the Common Stock during such measuring period.


 


If
at any time the Conversion Price as determined hereunder for any conversion would be less than the par value of the Common Stock,
then at the sole discretion of the Holder, the Conversion Price hereunder may equal such par value for such conversion and the
Conversion Amount for such conversion may be increased to include Additional Principal, where “Additional Principal”
means such additional amount to be added to the Conversion Amount to the extent necessary to cause the number of conversion shares
issuable upon such conversion to equal die same number of conversion shares as would have been issued had the Conversion Price
not been adjusted by the Holder to the par value price.


 


c)
Mechanics of Conversion.


 


i.
Conversion Shares Issuable Upon Conversion of Principal Amount. The number of Conversion Shares issuable upon a conversion
hereunder shall be determined by the quotient obtained by dividing (x) the outstanding principal amount of this Note to be converted
by (y) the Conversion Price.


 


ii.
Delivery of Certificate Upon Conversion. Not later than two (2) Trading Days after each Conversion Date (the “Share
Delivery’ Date”), the Company shall deliver, or cause to be delivered, to the Holder (A) a certificate or certificates
representing the Conversion Shares representing the number of Conversion Shares being acquired upon the conversion of this Note,
which certificate or certificates shall be free of restrictive legends and trading restrictions (other than those that may then
be required by the Purchase Agreement) if (i) generated on or after the six-month anniversary of the Original Issue Date (provided
that the Securities are then eligible for resale under Rule 144), (ii) such Securities are then the subject of an effective registration
statement, or (iii) such Securities are otherwise freely tradable pursuant to an applicable exemption from registration, (B) a
bank check in the amount of accrued and unpaid interest (if the Company has elected or is required to pay accrued interest in cash)
and (C) a bank check in the amount of the Make-Whole Amount. Each certificate or all certificates requited to be delivered by the
Company under this Section 4(c) shall be delivered electronically through The Depository Trust Company or another established clearing
corporation performing similar functions. If a certificate or certificates representing the Conversion Shares shall not be free
of restrictive legends because of the reasons set forth above, then the Conversion Shares shall bear a restrictive legend in the
following form, as appropriate:


 


“NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED, OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN
A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE
144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT
OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”


 



    7


     


    

  


iii.
Failure to Deliver Certificates. If, in the case of any Notice of Conversion, such certificate or certificates are
not delivered to or as directed by the applicable Holder by the Share Delivery Date, the Holder shall be entitled to elect by
written notice to the Company at any time on or before its receipt of such certificate or certificates, to rescind such Conversion,
in which event the Company shall promptly return to the Holder any original Note delivered to the Company and the Holder shall
promptly return to the Company the Common Stock certificates issued to such Holder pursuant to the rescinded Conversion Notice.
Whether or not the Holder elects to rescind any such Conversion, the Company shall promptly, upon demand therefor, reimburse the
Holder in cash for any fees and costs that the Holder may have directly or indirectly incurred by virtue of such untimely delivery
or absolute delivery failure. Such fees and costs include, but are not limited to, interest charges, margin fees, and costs of
“buy-in.” Further, the principal amount of the Note shall be increased by $1,000.00 for each calendar day that a failure
to deliver the certificates continues.


 


iv.
Obligation Absolute: Partial Liquidated Damages. The Company’s obligations to issue and deliver the Conversion
Shares upon conversion of this Note in accordance with the terms hereof are absolute and unconditional, irrespective of any action
or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recover)- of any
judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation, or termination,
or any breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged
violation of law by the Holder or any other Person, and irrespective of any other circumstance that might otherwise limit
such obligation of the Company to the Holder in connection with the issuance of such Conversion Shares; provided, however,
that such delivery shall not operate as a waiver by the Company of any such action the Company may have against the Holder. In
the event the Holder of this Note shall elect to convert any or all of the outstanding principal amount hereof, the Company may
not refuse conversion based on any claim that the Holder or anyone associated or affiliated with the Holder has been engaged in
any etiolation of law, agreement, or for any other reason, unless an injunction from a court, on notice to Holder, restraining
and or enjoining conversion of all or part of this Note shall have been sought and obtained, and the Company posts a surety bond
for the benefit of the Holder in the amount of 150% of the outstanding principal amount of this Note, which is subject to the injunction,
which bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of
which shall be payable to the Holder to the extent it obtains judgment. In the absence of such injunction, the Company shall issue
Conversion Shares or, if applicable, cash, upon a properly noticed conversion. If the Company fails for any reason to deliver to
the Holder such certificate or certificates pursuant to Section 4(c)(ii) by the Share Delivery Date, the Company shall pay to the
Holder, in cash, as liquidated damages and not as a penalty, for each $1,000.00 of principal amount being converted, $10.00 per
Trading Day (increasing to $20.00 per Trading Day on the fifth (5th) Trading Day after such liquidated damages begin
to accrue) for each Trading Day after such Share Delivery Date until such certificates are delivered or Holder rescinds such conversion.
Nothing herein shall limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to Section 6
hereof for the Company’s failure to deliver Conversion Shares within the period specified herein and the bidder shall have
the right to pursue all remedies available to it hereunder, at law or in equity? including, without limitation, a decree of specific
performance and/or injunctive relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages
pursuant to any other Section hereof or under applicable law.


 



    8


     


    

 


v.
Compensation for Buy-In on Failure to Timely Deliver Certificates Upon Conversion. In addition to any other rights
available to the Holder, if the Company fails for any reason to deliver to the Holder such certificate or certificates by the Share
Delivery Date pursuant to Section 4(c)(ii), and if after such Share Delivery Date the Holder is required by its brokerage firm
to purchase (in an open market transaction or otherwise), or the Holder’s brokerage firm otherwise purchases, shares of Common
Stock to deliver in satisfaction of a sale by the Holder of the Conversion Shares that the Holder was entitled to receive upon
the conversion relating to such Share Delivery Date (a “Buy-In”), then the Company shall (A) pay in cash to
the Holder (in addition to any other remedies available to or elected by the Holder) the amount, if any, by which (x) the Holder’s
total purchase price (including any brokerage commissions) for the Common Stock so purchased exceeds (y) the product of (1) the
aggregate number of shares of Common Stock that the Holder was entitled to receive from the conversion at issue multiplied by (2)
the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions)
and (B) at die option of tbc Holder, either reissue (if surrendered) this Note in a principal amount equal to the principal amount
of die attempted conversion (in which case such conversion shall be deemed rescinded) or deliver to the Holder the number of shares
of Common Stock that would have been issued if the Company had timely complied with its delivery requirements under Section 4(c)(ii).
For example, if the Holder purchases Common Stock having a total purchase price of $11,000.00 to cover a Buy-In with respect to
an attempted conversion of this Note with respect to which the actual sale price of the Conversion Shares (including any brokerage
commissions) giving rise to such purchase obligation was a total of $10,000.00 under clause (A) of the immediately preceding sentence,
the Company shall be required to pay the Holder $1,000.00. The Holder shall provide the Company written notice indicating the amounts
payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein
shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver
certificates representing shares of Common Stock upon conversion of this Note as required pursuant to the terms hereof.


 



    9


     


    

 


vi.
Reservation of Shares Issuable Upon Conversion. The Company covenants that it will at all times use its best efforts
to reserve and keep available out of its authorized and unissued shares of Common Stock (the “Note Reserved Shares”)
a number of shares of Common Stock calculated in accordance with the following formula:


 


=
(P/ CP)


 


P
= Principal Mount remaining on the Note


CP
= Applicable Conversion Price


 


The
Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued,
fully paid and nonassessable.


 


vii.
Fractional Shares. No fractional shares or scrip representing fractional shares shall be issued upon the conversion
of this Note. As to any fraction of a share that the Holder would otherwise be entitled to purchase upon such conversion, the Company
shall at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied
by the Conversion Price or round up to the next whole share.


 


viii.
Transfer Taxes and Expenses. The issuance of certificates for shares of the Common Stock on conversion of this Note
shall be made without charge to the Holder hereof for any documentary stamp or similar taxes that may be payable in respect of
the issue or delivery of such certificates, provided that, the Company shall not be required to pay any tax that may be payable
in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that
of the Holder of this Note so converted and the Company shall not be required to issue or deliver such certificates unless or until
the Person or Persons requesting the issuance thereof shah have paid to the Company the amount of such tax or shall have established
to the satisfaction of the Company that such tax has been paid. The Company shall pay all Transfer Agent fees required for standard
or same- day processing of any Notice of Conversion. The Company shall pay all other expenses that may reasonably be expected to
be incurred in respect of any conversion, including, but not limited to, legal opinions required for the issuance of such shares
of Common Stock and for the removal of any restrictive legends on any certificates evidencing such shares and stop transfer instructions
at the Transfer Agent.


 



    10


     


    

 


d)
Holder’s Conversion limitations. Only if and when the Company shall register its class of common stock under Section
12 of the Exchange Act, shall the Company not effect any conversion of this Note, and a Holder shall not have the right to convert
any portion of this Note, to the extent that after giving effect to the conversion set forth on the applicable Notice of Conversion,
the Holder (together with the Holder’s Affiliates, and any Persons acting as a group together with the Holder or any of the
Holder’s Affiliates) would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes
of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include
the number of shares of Common Stock issuable upon conversion of this Note with respect to which such determination is being made,
but shall exclude the number of shares of Common Stock that are issuable upon (i) conversion of the remaining, unconverted
principal amount of this Note beneficially owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the
unexercised or unconverted portion of any other securities of the Company subject to a limitation on conversion or exercise analogous
to the Limitation contained herein (including, without limitation, any other Notes) beneficially owned by the Holder or any of
its Affiliates. Except as set forth in the preceding sentence, for purposes of tins Section 4(d), beneficial ownership shall be
calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. To the extent
that the limitation contained m this Section 4(d) applies, the determination of whether this Note is convertible (in relation to
other securities owned by the Holder together with any Affiliates) and of which principal amount of this Note is convertible shall
be in the sole discretion of the Holder, and the submission of a Notice of Conversion shall be deemed to be the Holder’s
determination of whether this Note may be converted (in relation to other securities owned by the Holder together with any Affiliates)
and which principal amount of this Note is convertible, in each case subject to the Beneficial Ownership Limitation. To ensure
compliance with this restriction, the Holder will be deemed to represent to the Company each time it delivers a Notice of Conversion
that such Notice of Conversion has not violated the restrictions set forth in this paragraph and the Company shall have no obligation
to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above
shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder.
For purposes of this Section 4(d), in determining the number of outstanding shares of Common Stock, the Holder may rely on the
number of outstanding shares of Common Stock as stated In the most recent of the following: (i) the Company’s most recent
periodic or annual report filed with the Commission, as the case may be, (ii) a more recent public announcement by the Company,
or (iii) a more recent written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding.
Upon the written or oral request of a Holder, the Company shall within two Trading Days confirm orally and in writing to the Holder
the number of shares of Common Stock then-outstanding. In any case, the number of outstanding shares of Common Stock shall
be determined after giving effect to the conversion or exercise of securities of the Company, including this Note, by the Holder
or its Affiliates since the date as of which such number of outstanding shares of Common Stock was reported. The ‘‘Beneficial
Ownership limitation” shall be 4.99% of the number of shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon conversion of this Note held by the Holder. The Holder, upon not
less than 61 days’ prior notice to the Company, may increase or decrease the Beneficial Ownership limitation provisions of
this Section 4(d), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common
Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon conversion of this Note held by
the Holder and the Beneficial Ownership Limitation provisions of this Section 4(d) shall continue to apply. Any such increase or
decrease will not be effective until the 61st day after such notice is delivered to the Company. The Beneficial Ownership
Limitation provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with
the terms of this Section 4(d) to correct this paragraph (or any portion hereof) that may be defective or inconsistent with the
intended Beneficial Ownership Limitation contained herein or to make changes or supplements necessary or desirable to properly
give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Note.


 


Section
5.


 


a)
Stock Dividends and Stock Splits. If the Company, at any time while this Note is outstanding: (i) pays a stock dividend
or otherwise makes a distribution or distributions payable in shares of Common Stock on shares of Common Stock or any Common Stock
Equivalents (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon conversion
of, or payment of interest on, the Note), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii)
combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares (and see
Section 6(a)(xviii) in this regard), or (iv) issues, in the event of a reclassification of shares of the Common Stock, any shares
of capital stock of the Company, then the Conversion Price shall be multiplied by a fraction of which, the numerator shall be the
number of shares of Common Stock (excluding any treasury shares of the Company) outstanding immediately before such event, and
of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment
made pursuant to this Section shall become effective immediately after the record date for the determination of stockholders entitled
to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision,
combination, or re-classification.


 



    11


     


    

 


b)
Subsequent Equity Sales. If, at any time while this Note is outstanding, the Company or any Subsidiary, as applicable, sells
or grants any option to purchase or sells or grants any tight to reprice, or otherwise disposes of or issues (or announces any
sale, grant, or any option to purchase or other disposition), any’ Common Stock or Common Stock Equivalents entitling any
Person to acquire shares of Common Stock at an effective price per share that is lower than the then-Conversion Price (such lower
price, the “Base Conversion Price”; and, each such issuance, a “Dilutive Issuance”) (if the
holder of the Common Stock or Common Stock Equivalents so issued shall at any time, whether by operation of purchase price adjustments,
reset provisions, floating conversion, exercise or exchange prices, or otherwise, or due to warrants, options, or rights per share
that are issued in connection with such issuance, be entitled to receive shares of Common Stock at an effective price per share
that is lower than the Conversion Price, such issuance shall be deemed to have occurred for less than the Conversion Price on such
date of the Dilutive. Issuance), then the Conversion Price shall be reduced to equal the Base Conversion Price. Such adjustment
shall be made whenever such Common Stock or Common Stock Equivalents are issued. Notwithstanding the foregoing, no adjustment will
be made under this Section 5(b) in respect of an Exempt Issuance. If the Company enters into a Variable Rate Transaction, the Company
shall be deemed to have issued Common Stock or Common Stock Equivalents at the lowest possible conversion price at which such securities
may be converted or exercised. The Company shall notify the Holder in writing, no later than the Trading Day following the issuance
of any Common Stock or Common Stock Equivalents subject to this Section 5(b), indicating therein the applicable issuance price,
or applicable reset price, exchange price, conversion price and other pricing terms (such notice, the “Dilutive Issuance
Notice”). For purposes of clarification, whether or not the Company provides a Dilutive Issuance Notice pursuant to this
Section 5(b), upon the occurrence of any Dilutive Issuance, the Holder is entitled to receive a number of Conversion Shares based
upon the Base Conversion Price on or after the date of such Dilutive Issuance, regardless of whether the Holder accurately refers
to the Base Conversion Price in the Notice of Conversion. Further, the provisions of this
Section 5(b) also apply to any issuance of any Common Stock that results, directly or indirectly, from any agreement to which the
Company was a party, which agreement was in effect on or prior to the Original Issue Date.


 


c)
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 5(a), above, if at any time the
Company grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property
pro rata to the record holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder
will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights that the Holder
could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete conversion of tills Note
(without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership limitation) immediately
before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken,
the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase
Rights (provided, however, to the extent that the Holder’s tight to participate in any such Purchase Right
would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate
in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right
to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its
right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).


 



    12


     


    

 


d)
Pro-Rata Distributions. During such time as this Note is outstanding, if the Company shall declare or make any dividend
or other distribution of Its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of
capital or otherwise (including, without limitation, any distribution of cash, stock, or other securities, property or options
by way of a dividend, spin-off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction)
(a “Distribution”) at any time after the issuance of this Note, then, in each such case, the Holder shall be
entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of this Note (without regard to any limitations on
exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record
is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock
are to be determined for the participation in such Distribution (provided, however, to the extent that the Holder’s
right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the
Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of
Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for
the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial
Ownership Limitation).


 


e)
Fundamental Transaction. If, at any time while this Note is outstanding, (i) the Company, directly or indirectly,
in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company,
directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially
all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer
or exchange offer (whether by die Company or another Person) is completed pursuant to which holders of Common Stock are permitted
to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or
more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects
any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which
the Common Stock is effectively converted into or exchanged for other securities, cash or property, (v) the Company, directly or
indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person whereby su.ch other
Person acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other
Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or
share purchase agreement or other business combination) (each, a “Fundamental Transaction”), then, upon any
subsequent conversion of this Note, the Holder shah have the right to receive, for each Conversion Share that would have been issuable
upon such conversion immediately prior to the occurrence of such Fundamental Transaction (without regard to any limitation in Section
4(d) on the conversion of this Note), the number of shares of Common Stock of the successor or acquiring corporation or of the
Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Note
is convertible immediately prior to such Fundamental Transaction (without regard to any limitation in Section 4(d) on the conversion
of this Note). For purposes of any such conversion, the determination of the Conversion Price shall be appropriately adjusted to
apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one (1) share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the Conversion Price among the Alternate Consideration in
a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common
Stock are given any choice as to the securities, cash, or property to be received in a Fundamental Transaction, then the Holder
shall be given the same choice as to the Alternate Consideration it receives upon any conversion of this Note following such Fundamental
Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor
(the “Successor Entity”) to assume in writing all of the obligations of the Company under this Note and the
other Transaction Documents in accordance with the provisions of this Section 5(e) pursuant to written agreements in form and substance
reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction
and shall, at the option of the holder of this Note, deliver to the Holder in exchange for this Note a security of the Successor
Entity evidenced by a written instrument substantially similar in form and substance to this Note that is convertible for a corresponding
number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to die shares of Common Stock acquirable
and receivable upon conversion of this Note (without regard to any limitations on the conversion of this Note) prior to such Fundamental
Transaction, and with a conversion price that applies the conversion price hereunder to such shares of capital stock (but taking
into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares
of capital stock, such number of shares of capital stock and such conversion price being for the purpose of protecting the economic
value of this Note immediately prior to die consummation of such Fundamental Transaction), and that is reasonably satisfactory
in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed
to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Note and the
other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the obligations of the Company under this Note and the other Transaction
Documents with the same effect as if such Successor Entity had been named as the Company herein.


 



    13


     


    

 


f)
Calculations. All calculations under this Section 5 shall be made to the nearest cent or the nearest 1/100th of a
share, as the case may be. For purposes of this Section 5, the number of shares of Common Stock deemed to be issued and outstanding
as of a given date shall be the sum of the number of shares of Common Stock (excluding any treasury shares of the Company) issued
and outstanding.


 


g)
Notice to the Holder.


 


i.
Adjustment to Conversion Price. Whenever the Conversion Price is adjusted pursuant to any provision of this Section
5, the Company shall promptly deliver to each Holder a notice setting forth the Conversion Price after such adjustment and setting
forth a brief statement of the facts requiring such adjustment.


 


ii.
Notice to Allow Conversion by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever
form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common Stock of rights or warrants to subscribe for or
purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be
required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party,
any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common
Stock is converted into other securities, cash or property or (E) the Company shall authorize the voluntary or involuntary- dissolution,
liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be filed at each office
or agency maintained for the purpose of conversion of this Note, and shall cause to be delivered to the Holder at its last address
as it shall appear upon the Note Register, at least twenty (20) calendar days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution,
redemption, rights or warrants, or if a record is not to Ire taken, the date as of which the holders of the Common Stock of record
to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such
reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date
as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common
Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share
exchange, provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the
validity of the corporate action required to be specified in such notice. To the extent that any notice provided hereunder constitutes,
or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously
file such notice with the Commission pursuant to a Current Report on form 8-K. The Holder shall remain entitled to convert this
Note during the 20-day period commencing on the date of such notice through the effective date of the event triggering such notice
except as may otherwise be expressly set forth herein.


 



    14


     


    

 


Section
6. Events of Default.


 


a)
“Event of Default” means, wherever used herein, any of the following events (whatever the reason for
such event and whether such event 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 (A) the principal amount of any Note or (B) interest, liquidated damages and other amounts
owing to a Holder on any Note, as and when the same shall become due and payable (whether on a Conversion Date or the Maturity
Date or by acceleration or otherwise), which default, solely in the case of an interest payment or other default under clause (B),
above, is not cured within two (2) Trading Days;


 


ii.
the Company shall fail to observe or perform any other covenant or agreement contained in the Note (other than a breach
by the Company of its obligations to deliver shares of Common Stock to the Holder upon conversion, which breach is addressed in
clause (xi) below), which failure is not cured, if possible to cure, within the earlier to occur of (A) 5 Trading Days after notice
of such failure sent by the Holder or by any other Holder to the Company and (B) 10 Trading Days after the Company has become or
should have become aware of such failure;


 


iii.
a default or event of default (subject to any grace or cure period provided in the applicable agreement, document, or instrument)
shall occur under (A) any of the Transaction Documents or (B) any other material agreement, lease, document, or instrument to which
the Company or any Subsidiary is obligated (and not covered by clause (vi) below);


 


iv.
any representation or warranty made in this Note, any other Transaction Documents, any written statement pursuant hereto
or thereto or any other report, financial statement or certificate made or delivered to the Holder or any other Holder shall be
untrue or incorrect in any material respect as of the date when, made or deemed made;


 


v.
the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to
a Bankruptcy Event;


 


vi.
the Company or any Subsidiary shall default on any of its obligations under any mortgage, credit agreement or other facility,
indenture agreement, factoring agreement or other instrument under which there may be issued, or by which there may be secured
or evidenced, any indebtedness for borrowed money or money due under any long term leasing or factoring arrangement that (a) involves
an obligation greater than $100,000,00, whether such indebtedness now exists or shall hereafter be created, and (b) results in
such indebtedness becoming or being declared due and payable prior to the date on which it would otherwise become due and payable;


 



    15


     


    

 


vii.
the Common Stock shall not be eligible for listing or quotation for trading on a Trading Market and shall not be eligible
to resume listing or quotation for trading thereon within five (5) Trading Days or the transfer of shares of Common Stock through
The Depository Trust Company System is no longer available or “chilled” or “frozen”;


 


viii.
the Company shall be a party to any Change of Control Transaction or Fundamental Transaction or shall agree to sell or dispose
of all or in excess of one- third (1/3) of its assets in one transaction or a series of related transactions (whether or not such
sale would constitute a Change of Control Transaction);


 


ix.
the Company does not meet the current public information requirements under Rule 144 in respect of the Conversion Shares;


 


x.
the Company shall fail for any reason to deliver certificates via DWAC to a Holder prior to the second (2nd)
Trading Day after a Conversion Date pursuant to Section 4(c) or the Company shall provide at any time notice to the Holder, including
by way of public announcement, of the Company’s intention to not honor requests for conversions of the Note in accordance
with the terms hereof;


 


xi.
the Company fails to file with the Commission any required reports under Section 13 or 15(d) of the Exchange Act such that
it is not in compliance with Rule 144(c)(1) (or Rule 144(i)(2), if applicable);


 


xii.
if the Borrower or any Significant Subsidiary shall: (A) apply for or consent to the appointment of a receiver, trustee,
custodian or liquidator of it or any of its properties, (B) admit in writing its inability to pay its debts as they mature, (C) make
a general assignment for the benefit of creditors, (D) be adjudicated a bankrupt or insolvent or be the subject of an order for
relief under Title 11 of the United States Code or any bankruptcy, reorganization, insolvency, readjustment of debt, dissolution,
or liquidation law or statute of any other jurisdiction or foreign country, (E) file a voluntary petition in bankruptcy, or a petition
or an answer seeking reorganization or an arrangement with creditors or to take advantage or any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution, or liquidation law or statute, or an answer admitting the material allegations of a petition
filed against it in any proceeding under any such law, or (F) take or permit to be taken any action in furtherance of or for the
purpose of effecting any of the foregoing;


 


xiii.
if any order, judgment or decree shall be entered, without the application, approval or consent of the Borrower or any Significant
Subsidiary, by any court of competent jurisdiction, approving a petition seeking liquidation or reorganization of the Borrower
or any Subsidiary, or appointing a receiver, trustee, custodian or liquidator of the Borrower or any Subsidiary, or of all or any
substantial part of its assets, and such order, judgment or decree shall continue unstayed and in effect for any period of sixty
(60) days;


 


xiv.
the occurrence of any levy upon or seizure or attachment of, or any uninsured loss of or damage to, any property of the
Borrower or any Subsidiary having an aggregate fair value or repair cost (as die case may be) in excess of $100,000.00 individually
or in the aggregate, and any such levy, seizure or attachment shall not be set aside, bonded, or discharged within thirty (30)
days after the date thereof;


 



    16


     


    

 


xv.
the Company shall fail to maintain sufficient reserved shares pursuant to Section 4.11 of the Purchase Agreement;


 


xvi.
any monetary judgment, writ, or similar final process shall be entered or filed against the Company, any subsidiary, or
any of their respective property or other assets for more than $100,000.00, and such judgment, writ, or similar final process
shall remain unvacated, unbonded, or unstayed for a period of forty-five (45) calendar days;


 


xvii.
the Company shall have terminated the Transfer Agent and, prior to the date thereof and the date on which the Company has
appointed a replacement therefor, shall have failed (A) to obtain a replacement, irrevocable letter of instructions executed by
the Company and the replacement transfer agent and (B) irrevocably to reserve with such replacement transfer agent the Reserved
Shares;


 


xviii.
the Company combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number
of shares;


 


xix.
the OTC Markets Group Inc.’s webpage for the Company’s trading symbol provides either a “stop” or
a “ caveat emptor” notation; or


 


xx.
the Company shall fail to disclose the transaction contemplated by this Note and the other Transaction Documents fully in
the First filing that it makes with the Securities and Exchange Commission or with the OTC Markets Group Inc. in any disclosure
document.


 


b)
Remedies Upon Event of Default. If any Event of Default occurs, the Company shall have five (5) days to cure such
Event of Default. If following the five-day period the Event of Default remains, then the outstanding principal amount of this
Note, plus accrued but unpaid interest, liquidated damages and other amounts owing in respect thereof through the date of acceleration,
shall become, at the Holder’s election, immediately due and payable in cash at the Mandatory Default Amount. Further, upon
the sixth (6th) day following an Event of Default (unless cured in the manner set forth hereinabove), the then-outstanding
principal amount of this Note shall be immediately increased by fifty percent (50%); provided, however, that such
increase shall be twenty-five percent (25%) solely if the Event of Default is pursuant to Section 6(a)(xviii). Commencing five
(5) days after the occurrence of any Event of Default that results in the eventual acceleration of this Note, the interest rate
on this Note shall accrue at an additional interest rate equal to the lesser of one and one-half percent (1.50%) per month (18%
per annum) or the maximum rate permitted under applicable law. Upon the payment in full of the Mandatory Default Amount, the Holder
shall promptly surrender this Note to or as directed by the Company. In connection with such acceleration described herein, the
Holder need not provide, and the Company hereby waives, any presentment, demand, protest or other notice of any kind, and the Holder
may immediately and without expiration of any grace period enforce any and all of its rights and remedies hereunder and all other
remedies available to it under applicable law. Such acceleration may be rescinded and annulled by the Holder at any time prior
to payment hereunder and the Holder shall have all rights as a holder of the Note until such time, if any, as the Holder receives
full payment pursuant to this Section 6(b). No such rescission or annulment shall affect any subsequent Event of Default or impair
any right consequent thereon. Further to, and not in denigration of any other remedies to which the Holder may be entitled, if
any Event of Default occurs and following the five-day cure period the Event of Default remains, then the Holder has the right,
but not the obligation, to exercise its rights to convert all or any part of this Note into Common Stock at the Conversion Price.


 



    17


     


    

 


Section
7. Miscellaneous.


 


a)
Notices. Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without
limitation, any Notice of Conversion, shall be in writing and delivered personally, by facsimile, or sent by a nationally recognized
overnight courier service, addressed to the Company, at the address set forth above, or such other facsimile number or address
as die Company may specify’ for such purposes by notice to the Holder delivered in accordance with this Section 7(a). Any
and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered
personally, by facsimile, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile
number or address of the Holder appearing on the books of the Company, or if no such facsimile number or address appears on the
books of the Company, at the principal place of business of such Holder, as set forth
in the Purchase Agreement. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the
earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set
forth on the signature pages attached hereto prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after
the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature
pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii)
the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv)
upon actual receipt by the party’ to whom such notice is required to be given.


 


b)
Absolute Obligation. 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, liquidated damages and accrued interest, as applicable,
on this Note at the time, place, and rate, and in the coin or currency, herein prescribed. This Note is a direct debt obligation
of the Company. This Note ranks pari passu with all other Notes now or hereafter issued under the terms set forth herein.


 


c)
Lost or Mutilated Note. 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, reasonably satisfactory to the Company.


 


d)
Governing Law. All questions concerning the construction, validity,
enforcement, and interpretation of this Note shall be governed by and construed and enforced in accordance with the internal laws
of the State of Delaware, without regard to the principles of conflict of laws thereof. Each party agrees that all legal proceedings
concerning the interpretation, enforcement and defense of the transactions contemplated by any of the Transaction Documents (whether
brought against a party hereto or its respective Affiliates, directors, officers, shareholders, employees, or agents) shall be
commenced exclusively in the state and federal courts sitting in the City of New York, Borough of Manhattan (the “New
York Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for
the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not
to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such New York Courts,
or such New York Courts are improper or inconvenient venue for such proceeding- Each party hereby irrevocably waives personal service
of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under
this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process m any other manner permitted by applicable law. Each party
hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any
legal proceeding arising out of or relating to this Note or the transactions contemplated hereby. If any party shall commence an
action or proceeding to enforce any provisions of this Note, then the prevailing party in such action or proceeding shall be reimbursed
by the other party for its attorneys’ fees and other costs and expenses incurred
in the investigation, preparation, and prosecution of such action or proceeding.


 



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e)
Waiver. 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
on any other occasion. Any waiver by the Company or the Holder must be in writing.


 


f)
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. If it shall be found that any interest or other amount deemed interest due hereunder violates
the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum
rate of interest permitted under applicable law. The Company covenants (to the extent that it may lawfully do so) that it shall
not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law or other law that would prohibit or forgive the Company from paying all or any portion of the principal of or interest
on this Note as contemplated herein, wherever enacted, now or at any time hereafter in force, or that may affect the covenants
or the performance of this Note, and the Company (to the extent it may lawfully do so) hereby expressly waives all benefits or
advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Holder, but will suffer and permit the execution of every such as though no such law has been enacted.


 


g)
Remedies, Characterizations, Other Obligations, Breaches, and Injunctive Relief. The remedies provided in this Note
shall be cumulative and in addition to all other remedies available under this Note and any of the other Transaction Documents
at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit
the Holder’s right to pursue actual and consequential damages for any failure by the Company to comply with the terms of
this Note. The Company covenants to the Holder that there shall be no characterization concerning this instrument other than as
expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the
computation thereof) shall be the amounts to be received by the Holder and shall not, except as expressly provided herein, be
subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach may be inadequate.
The Company therefore agrees that, in the event of any such breach or threatened breach, the Holder shall be entitled, in addition
to all other available remedies, to an injunction restraining any such breach or any such threatened breach, without the necessity
of showing economic loss and without any bond or other security being required. The Company shall provide all information and
documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with
the terms and conditions of this Note.


 


h)
Next 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.


 


i)
Headings. The headings contained herein are for convenience only, do not constitute a part of this Note and shall
not be deemed to limit or affect any of the provisions hereof.


 


(Signature
Page Follows)


 



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IN
WITNESS WHEREOF, the Company has caused this Note to be duly executed by a duly authorized officer as of the date first above indicated.


 


UPPERCUT
BRANDS INC.


 


	By:	 	 
	 	Eric Weisblum, Chief Executive Officer	 


 



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ANNEX
A


 


NOTICE
OF CONVERSION


 


The
undersigned hereby elects to convert principal under the Original Issue Discount Senior Convertible Promissory Note due October
__, 2020, of Uppercut Brands Inc., a Delaware corporation (the “Company”), into shares of common stock (the
“Common Stock”) of the Company according to the conditions hereof as of the date written below. If shares of
Common Stock 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 and opinions as reasonably requested by the Company in accordance
therewith. No fee will be charged to the holder for any conversion, except for such transfer taxes, if any.


 


By
the delivery of this Notice of Conversion the undersigned represents and warrants to the Company that its ownership of the Common
Stock does not exceed the amounts specified under Section 4 of this Note, as determined in accordance with Section 13(d) of the
Exchange Act (if applicable pursuant to the provisions of Section 4 of the Note).


 


	 	Conversion calculations:	 _________________________________________
	 	Date to Effect Conversion: 	 _________________________________________


 


Principal
Amount of Note to be Converted: $ _________________________________________


 


Payment
of Interest in Common Stock: ____________________ yes _____ no ____


 


If
yes, $      of Interest Accrued on Account of Conversion at Issue.


 


	 	Number of shares of Common Stock to be issued: 	 _________________________________________


 


	 	Signature: 	 _________________________________________
	 	Name:	 _________________________________________


 


	 	DWAC Instructions:	 _________________________________________


 


Broker
Name, address, contact person, arid telephone number:


 


 _________________________________________


 


 _________________________________________


 


 _________________________________________


  


	 	Broker DTC No:	_________________________________________
	 	 	 
	 	Account No:	_________________________________________





 






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Schedule
1


CONVERSION
SCHEDULE


 


This
Original Issue Discount Senior Convertible Promissory Note due on October 11, 2020, in the original principal amount of $_________
is issued by Uppercut Brands Inc., a Delaware corporation. This Conversion Schedule reflects conversions made under Section 4 of
the above-referenced Note.


 


Dated:
October __, 2019


 


	Date of Conversion (or, for first entry, Original Issue Date)	Amount of Conversion	Aggregate Principal Amount Remaining Subsequent to Conversion (or original Principal Amount)	Company Attest
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 


 


 




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