Exhibit
10.5


 


THIS
INSTRUMENT CONTAINS AN AFFIDAVIT OF CONFESSION OF JUDGMENT PROVISION WHICH CONSTITUTES A WAIVER OF IMPORTANT RIGHTS BORROWER MAY HAVE
AND ALLOWS THE HOLDER TO OBTAIN A JUDGMENT AGAINST BORROWER WITHOUT ANY FURTHER NOTICE. 


 


NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
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 MAY BE THE LEGAL COUNSEL OPINION (AS DEFINED IN THE PURCHASE AGREEMENT)),
IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A OR
REGULATION S UNDER SAID ACT OR OTHER APPLICABLE EXEMPTION. 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.


 


	Principal Amount: $250,000.00	 	Issue
                                            Date: October 13, 2021
	Actual Amount of Purchase Price: $225,000.00	 	 



 


PROMISSORY
NOTE


 


FOR VALUE RECEIVED,
ELECTROMEDICAL TECHNOLOGIES, INC., a Delaware corporation(hereinafter called the “Borrower” or the “Company”)
(Trading Symbol: EMED), hereby promises to pay to the order of Talos Victory Fund, LLC, a Delaware limited liability company,
or registered assigns (the “Holder”), in the form of lawful money of the United States of America, the principal sum of $250,000.00,
which amount is the $225,000.00 actual amount of the purchase price (the “Consideration”) hereof plus an original issue discount
in the amount of $25,000.00 (the “OID”) (subject to adjustment herein) (the “Principal Amount”) and to pay interest
on the unpaid Principal Amount hereof at the rate of ten percent (10%) (the “Interest Rate”) per annum from the date hereof
(the “Issue Date”) until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment or otherwise,
as further provided herein. The maturity date shall be twelve (12) months from the Issue Date (the “Maturity Date”), and
is the date upon which the Principal Sum, the OID, as well as any accrued and unpaid interest and other fees, shall be due and payable.


 


This Note
may not be prepaid or repaid in whole or in part except as otherwise explicitly set forth herein.


 


Any Principal
Amount or interest on this Note which is not paid when due shall bear interest at the rate of the lesser of (i) sixteen percent (16%)
per annum and (ii) the maximum amount permitted by law from the due date thereof until the same is paid (“Default Interest”).
Interest and Default Interest shall be computed on the basis of a 365-day year and the actual number of days elapsed.


 


All payments
due hereunder (to the extent not converted into shares of common stock, $0.00001 par value per share, of the Borrower (the “Common
Stock”) in accordance with the terms hereof) shall be made in lawful money of the United States of America. All payments shall be
made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this
Note. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a business day, the same shall
instead be due on the next succeeding day which is a business day.


 


Each capitalized
term used herein, and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase Agreement, dated
as of the Issue Date, pursuant to which this Note was originally issued (the “Purchase Agreement”). As used in this Note,
the term “business day” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the city of
New York, New York are authorized or required by law or executive order to remain closed. As used herein, the term “Trading Day”
means any day that shares of Common Stock are listed for trading or quotation on the Principal Market (as defined in the Purchase Agreement),
provided, however, that if the Common Stock is not then listed or quoted on any Principal Market, then any calendar day.


 






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This Note
is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights
or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.


 


The following
terms shall also apply to this Note:


 


ARTICLE
I. CONVERSION RIGHTS


 


1.1 Conversion
Right. The Holder shall have the right, on any calendar day, at any time on orfollowing the date that is six (6) calendar months
after the Issue Date, to convert all or any portion of the then outstanding and unpaid Principal Amount and interest (including any
Default Interest) into fully paid and nonassessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any
shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified,
at the Conversion Price (as defined below) determined as provided herein (a “Conversion”); provided, however,
that notwithstanding anything to the contrary contained herein, the a Holder shall not have the right to convert any portion of this
Note, pursuant to Section 1 or otherwise, to the extent that after giving effect to such issuance after conversion as set forth on
the applicable Notice of Conversion, the Holder (together with the Holder’s affiliates (the “Affiliates”), and any
other Persons (as defined below) acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons,
 “Attribution Parties”)), 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 Attribution Parties
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 which would be issuable upon (i) conversion of the remaining,
nonconverted portion of this Note beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise
or conversion of the unexercised or nonconverted portion of any other securities of the Company subject to a limitation on
conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or
Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 1.1, beneficial ownership shall be
calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being
acknowledged by the Holder that the Holder is solely responsible for any schedules required to be filed in accordance therewith. 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 1.1, in determining the number of
outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the
Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public
announcement by the Company or (C) 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 or Attribution Parties 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 at the time of the respective calculation hereunder. “Person” and “Persons” means an
individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization, any
other entity and any governmental entity or any department or agency thereof. The limitations contained in this paragraph shall
apply to a successor holder of this Note. The number of Conversion Shares to be issued upon each conversion of this Note shall be
determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date
specified in the notice of conversion, in the form attached hereto as Exhibit A (the “Notice of Conversion”),
delivered to the Borrower or Borrower’s transfer agent by the Holder in accordance with Section 1.4 below; provided that the
Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in,
notice) to the Borrower or Borrower’s transfer agent before 11:59 p.m., New York, New York time on such conversion date (the
 “Conversion Date”). The term “Conversion Amount” means, with respect to any conversion of this Note, the sum
of (1) the Principal Amount of this Note to be converted in such conversion plus (2) at the Holder’s option, accrued
and unpaid interest, if any, on such Principal Amount at the Interest Rate to the Conversion Date, plus (3) at the
Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2).


 






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1.2 Conversion
Price.


 


(a) Calculation
of Conversion Price. The per share conversion price into which Principal Amount and interest (including any Default Interest) under
this Note shall be convertible into shares of Common Stock hereunder (the “Conversion Price”) shall equal $0.06. 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 the 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. The Conversion Price is subject to equitable adjustments for stock splits, stock dividends or rights offerings by the Borrower
relating to the Borrower’s securities or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications,
extraordinary distributions and similar events. Holder shall be entitled to deduct $1,750.00 from the conversion amount in each Notice
of Conversion to cover Holder’s fees associated with each Notice of Conversion.


 


1.3 Authorized
and Reserved Shares. The Borrower covenants that at all times until the Note is satisfied in full, the Borrower will reserve
from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the
issuance of a number of Conversion Shares equal to the greater of: (a) 8,333,333 shares of Common Stock or (b) the sum of (i) the
number of Conversion Shares issuable upon the full conversion of this Note (assuming no payment of Principal Amount or interest) at
the time of such calculation (taking into consideration any adjustments to the Conversion Price as provided in this Note) multiplied
by (ii) two (2) (the “Reserved Amount”). The Borrower represents that upon issuance, the Conversion Shares will be
duly and validly issued, fully paid and non-assessable. The Borrower (i) acknowledges that it has irrevocably instructed its
transfer agent to issue certificates for the Conversion Shares or instructions to have the Conversion Shares issued as contemplated
by Section 1.4(f) hereof, and (ii) agrees that its issuance of this Note shall constitute full authority to its officers and agents
who are charged with the duty of executing stock certificates or cause the Company to electronically issue shares of Common Stock to
execute and issue the necessary certificates for the Conversion Shares or cause the Conversion Shares to be issued as contemplated
by Section 1.4(f) hereof in accordance with the terms and conditions of this Note.


 


If, at any
time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default (as defined in this Note) under this
Note.


 


1.4 Method of
Conversion.


 


(a)                 Mechanics
of Conversion. This Note may be converted by the Holder in whole or in part, on any calendar day, at any time on or following
the date that is six (6) calendar months after the Issue Date, by submitting to the Borrower or Borrower’s transfer agent a
Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to
11:59 p.m., New York, New York time). Any Notice of Conversion submitted after 11:59 p.m., New York, New York time, shall be deemed
to have been delivered and received on the next Trading Day.


 


 


(b)                Surrender
of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance
with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire unpaid
Principal Amount is so converted. The Holder and the Borrower shall maintain records showing the Principal Amount so converted and
the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to
require physical surrender of this Note upon each such conversion. In the event of any dispute or discrepancy, such records of the
Holder shall, prima facie, be controlling and determinative in the absence of manifest error. Notwithstanding the foregoing,
if any portion of this Note is converted as aforesaid, the Holder may not transfer this Note unless the Holder first physically
surrenders this Note to the Borrower, whereupon the Borrower will forthwith issue and deliver upon the order of the Holder a new
Note of like tenor, registered as the Holder (upon payment by the Holder of any applicable transfer taxes) may request, representing
in the aggregate the remaining unpaid Principal Amount of this Note. 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 represented by this Note may be less than the amount stated on the face
hereof.


 


 


(c)                 Payment
of Taxes. The Borrower shall not be required to pay any tax which may be payable in respect of any transfer involved in the
issue and delivery of shares of Common Stock or other securities or property on conversion of this Note in a name other than that of
the Holder (or in street name), and the Borrower shall not be required to issue or deliver any such shares or other securities or
property unless and until the person or persons (other than the Holder or the custodian in whose street name such shares are to be
held for the Holder’s account) requesting the issuance thereof shall have paid to the Borrower the amount of any such tax or
shall have established to the satisfaction of the Borrower that such tax has been paid.


 


(d)               
Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower or Borrower’s transfer agent from the Holder
of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements
for conversion as provided in this Section 1.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the
order of the Holder certificates for the Conversion Shares (or cause the electronic delivery of the Conversion Shares as contemplated
by Section 1.4(f) hereof) within one (1) Trading Day after such receipt (the “Deadline”) (and, solely in the case of conversion
of the entire unpaid Principal Amount and interest (including any Default Interest) under this Note, surrender of this Note). If the Company
shall fail for any reason or for no reason to issue to the Holder on or prior to the Deadline a certificate for the number of Conversion
Shares or to which the Holder is entitled hereunder and register such Conversion Shares on the Company’s share register or to credit
the Holder’s balance account with DTC (as defined below) for such number of Conversion Shares to which the Holder is entitled upon
the Holder’s conversion of this Note (a “Conversion Failure”), then, in addition to all other remedies available to
the Holder, (i) the Company shall pay in cash to the Holder on each day after the Deadline and during such Conversion Failure an amount
equal to 2.0% of the product of (A) the sum of the number of Conversion Shares not issued to the Holder on or prior to the Deadline and
to which the Holder is entitled and (B) the closing sale price of the Common Stock on the Trading Day immediately preceding the last possible
date which the Company could have issued such Conversion Shares to the Holder without violating this Section 1.4(d); and (ii) the Holder,
upon written notice to the Company, may void all or any portion of such Notice of Conversion; provided that the voiding of all or any
portion of a Notice of Conversion shall not affect the Company’s obligations to make any payments which have accrued prior to the
date of such notice. In addition to the foregoing, if on or prior to the Deadline the Company shall fail to issue and deliver a certificate
to the Holder and register such Conversion Shares on the Company’s share register or credit the Holder’s balance account with
DTC for the number of Conversion Shares to which the Holder is entitled upon the Holder’s exercise hereunder or pursuant to the
Company’s obligation pursuant to clause (ii) below, and if on or after such Trading Day the Holder purchases (in an open market
transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable
upon such exercise that the Holder anticipated receiving from the Company, then the Company shall, within two (2) Trading Days after the
Holder’s request and in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal to the Holder’s
total purchase price (including brokerage commissions and other reasonable and customary out-of-pocket expenses, if any) for the shares
of Common Stock so purchased (the “Buy-In Price”), at which point the Company’s obligation to deliver such certificate
(and to issue such Conversion Shares) or credit such Holder’s balance account with DTC for such Conversion Shares shall terminate,
or (ii) promptly honor its obligation to deliver to the Holder a certificate or certificates representing such Conversion Shares or credit
such Holder’s balance account with DTC and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price
over the product of (A) such number of shares of Common Stock, times (B) the closing sales price of the Common Stock on the date of exercise.
Nothing shall limit the 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 the Conversion Shares (or to electronically deliver such Conversion Shares) upon the conversion of this Note as required
pursuant to the terms hereof.


 






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(e)                 Obligation
of Borrower to Deliver Common Stock. At the time that the Holder submits the Notice of Conversion to the Borrower or
Borrower’s transfer agent, the Holder shall be deemed to be the holder of record of the Conversion Shares issuable upon such
conversion, the outstanding Principal Amount and the amount of accrued and unpaid interest (including any Default Interest) under
this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations under this Article I,
all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the
Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the Holder shall have given a
Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for the Conversion
Shares (or cause the electronic delivery of the Conversion Shares as contemplated by Section 1.4(f) hereof) shall be absolute and
unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to
any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in
the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation
or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other
circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion. The
Conversion Date specified in the Notice of Conversion shall be the Conversion Date so long as the Notice of Conversion is sent to
the Borrower or Borrower’s transfer agent before 11:59 p.m., New York, New York time, on such date.


 


(f)                  Delivery
of Conversion Shares by Electronic Transfer. In lieu of delivering physical certificates representing the Conversion Shares
issuable upon conversion hereof, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast
Automated Securities Transfer or Deposit/Withdrawal at Custodian programs, upon request of the Holder and its compliance with the
provisions contained in Section 1.1 and in this Section 1.4, the Borrower shall use its best efforts to cause its transfer agent to
electronically transmit the Conversion Shares issuable upon conversion hereof to the Holder by crediting the account of
Holder’s Prime Broker with DTC through its Deposit Withdrawal Agent Commission system.


 


1.5 Concerning
the Shares. The Conversion Shares issuable upon conversion of this Note may not be sold or transferred unless (i) such shares
are sold pursuant to an effective registration statement under the 1933 Act or (ii) the Borrower or its transfer agent shall have
been furnished with an opinion of counsel (which opinion shall be the Legal Counsel Opinion (as defined in the Purchase Agreement))
to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration
or (iii) such shares are sold or transferred pursuant to Rule 144, Rule 144A, Regulation S, or other applicable exemption, or (iv)
such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise
transfer the shares only in accordance with this Section 1.5 and who is an Accredited Investor (as defined in the Purchase
Agreement). Except as otherwise provided in the Purchase Agreement (and subject to the removal provisions set forth below), until
such time as the Conversion Shares have been registered under the 1933 Act or otherwise may be sold pursuant to Rule 144, Rule 144A,
Regulation S, or other applicable exemption without any restriction as to the number of securities as of a particular date that can
then be immediately sold, each certificate for the Conversion Shares that has not been so included in an effective registration
statement or that has not been sold pursuant to an effective registration statement or an exemption that permits removal of the
legend, shall bear a legend substantially 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 MAY BE THE LEGAL COUNSEL OPINION (AS DEFINED IN THE PURCHASE AGREEMENT)),
IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A,
REGULATION S UNDER SAID ACT, OR OTHER APPLICABLE EXEMPTION. 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.” 


 






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The legend
set forth above shall be removed and the Company shall issue to the Holder a certificate for the applicable Conversion Shares without
such legend upon which it is stamped or (as requested by the Holder) issue the applicable Conversion Shares by electronic delivery by
crediting the account of such holder’s broker with DTC, if, unless otherwise required by applicable state securities laws: (a) such
Conversion Shares are registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be sold
pursuant to Rule 144, Rule 144A, Regulation S, or other applicable exemption without any restriction as to the number of securities as
of a particular date that can then be immediately sold, or (b) the Company or the Holder provides the Legal Counsel Opinion (as contemplated
by and in accordance with Section 4(m) of the Purchase Agreement) to the effect that a public sale or transfer of such Conversion Shares
may be made without registration under the 1933 Act, which opinion shall be accepted by the Company so that the sale or transfer is effected.
The Company shall be responsible for the fees of its transfer agent and all DTC fees associated with any such issuance. The Holder agrees
to sell all Conversion Shares, including those represented by a certificate(s) from which the legend has been removed, in compliance with
applicable prospectus delivery requirements, if any. In the event that the Company does not accept the opinion of counsel provided by
the Holder with respect to the transfer of Conversion Shares pursuant to an exemption from registration, such as Rule 144, Rule 144A,
Regulation S, or other applicable exemption, at the Deadline, notwithstanding that the conditions of Rule 144, Rule 144A, Regulation S,
or other applicable exemption, as applicable, have been met, it will be considered an Event of Default under this Note.


 


1.6 Effect of
Certain Events.


 


(a) Effect of Merger, Consolidation,
Etc. At the option of the Holder, the sale,conveyance or disposition of all or substantially all of the assets of the Borrower,
or the consolidation, merger or other business combination of the Borrower with or into any other Person (as defined below) or
Persons when the Borrower is not the survivor shall either: (i) be deemed to be an Event of Default pursuant to which the Borrower
shall be required to pay to the Holder upon the consummation of and as a condition to such transaction an amount equal to the
Default Amount (defined in Section 3.19) or (ii) be treated pursuant to Section 1.6(b) hereof. “Person” shall mean any
individual, corporation, limited liability company, partnership, association, trust or other entity or organization.


 


(b) Adjustment Due to Merger,
Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion of all of this Note, there
shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar event, as a result of
which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares of another class or
classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of all or substantially all
of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower, then the Holder of this
Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and upon the terms and conditions
specified herein and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities
or assets which the Holder would have been entitled to receive in such transaction had this Note been converted in full immediately
prior to such transaction (without regard to any limitations on conversion set forth herein), and in any such case appropriate
provisions shall be made with respect to the rights and interests of the Holder of this Note to the end that the provisions hereof
(including, without limitation, provisions for adjustment of the Conversion Price and of the number of shares issuable upon
conversion of the Note) shall thereafter be applicable, as nearly as may be practicable in relation to any securities or assets
thereafter deliverable upon the conversion hereof. The Borrower shall not effectuate any transaction described in this Section
1.6(b) unless (a) it first gives, to the extent practicable, at least thirty (30) days prior written notice (but in any event at
least fifteen (15) days prior written notice) of the record date of the special meeting of shareholders to approve, or if there is
no such record date, the consummation of, such merger, consolidation, exchange of shares, recapitalization, reorganization or other
similar event or sale of assets (during which time the Holder shall be entitled to convert this Note) and (b) the resulting
successor or acquiring entity (if not the Borrower) assumes by written instrument the obligations of this Section 1.6(b). The above
provisions shall similarly apply to successive consolidations, mergers, sales, transfers or share exchanges.


 







(c) Adjustment
Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire its assets) to
holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any dividend or
distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock of a subsidiary
(i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion of this Note
after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such assets which
would have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had such Holder been
the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to such
Distribution.


 






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(d) Purchase Rights. If, at any time when all or any portion of this Note is issued and outstanding,
the Borrower issues any convertible securities or rights to purchase stock, warrants, securities or other property (the “Purchase
Rights”) pro rata to the record holders of any class of Common Stock, then the Holder of this Note will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder
had held the number of shares of Common Stock acquirable upon complete conversion of this Note (without regard to any limitations on conversion
contained herein) 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 Common Stock are to be determined for the grant, issue or sale of
such Purchase Rights.


 







(e) Dilutive
Issuance. If the Borrower, at any time while this Note or any amounts due hereunder are outstanding, issues, sells or grants (or
has issued, sold or granted as of the Issue Date, as the case may be) any option to purchase, or sells or grants any right to
reprice, or otherwise disposes of, or issues (or has sold or issued, as the case may be, or announces any sale, grant or any option
to purchase or other disposition), any Common Stock or other securities convertible into, exercisable for, or otherwise entitle any
person or entity the right to acquire, shares of Common Stock (including, without limitation, upon conversion of this Note, and any
convertible notes or warrants outstanding as of or following the Issue Date), in each or any case at an effective price per share
that is lower than the then Conversion Price (such lower price, the “Base Conversion Price” and such issuances,
collectively, a “Dilutive Issuance”) (it being agreed that if the holder of the Common Stock or other securities 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 which 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, at the option of the Holder, to a price equal to the Base Conversion Price. Such adjustment shall be made
whenever such Common Stock or other securities are issued. By way of example, and for the avoidance of doubt, if the Company issues
a convertible promissory note (including but not limited to a Variable Rate Transaction), and the holder of such convertible
promissory note has the right to convert it into Common Stock at an effective price per share that is lower than the then Conversion
Price (including but not limited to a conversion price with a discount that varies with the trading prices of or quotations for the
Common Stock), then the Holder has the right to reduce the Conversion Price to such Base Conversion Price (including but not limited
to a conversion price with a discount that varies with the trading prices of or quotations for the Common Stock) in perpetuity
regardless of whether the holder of such convertible promissory note ever effectuated a conversion at the Base Conversion Price.
Notwithstanding the foregoing, no adjustment will be made under this Section 1.6(e) in respect of an Exempt Issuance. In the event
of an issuance of securities involving multiple tranches or closings, any adjustment pursuant to this Section 1.6(e) shall be
calculated as if all such securities were issued at the initial closing. For the avoidance of doubt, the Holder shall be entitled to
utilize the Base Conversion Price with respect to a Dilutive Issuance, even if the Dilutive Issuance occurs prior to the date that
the Holder is entitled to convert this Note.


 


An
 “Exempt Issuance” shall mean the issuance of (a) shares of Common Stock or other securities to officers or directors of
the Company pursuant to any stock or option or similar equity incentive plan duly adopted for such purpose, by a majority of the
non-employee members of the Company’s Board of Directors or a majority of the members of a committee of non-employee directors
established for such purpose in a manner which is consistent with the Company’s prior business practices; (b) securities
issued pursuant to a merger, consolidation, acquisition or similar business combination approved by a majority of the disinterested
directors of the Company, provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is,
itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the
Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a
transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities; (c) securities issued pursuant to any equipment loan or leasing arrangement, real property
leasing arrangement or debt financing from a bank or similar financial institution approved by a majority of the disinterested
directors of the Company; or (d) securities issued with respect to which the Holder waives its rights in writing under this Section
1.6(e).


 






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(f) Notice
of Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Price as a result of the events
described in Section 1.6 of this Note, the Borrower shall, at its expense and within one (1) calendar day after the occurrence of
each respective adjustment or readjustment of the Conversion Price, compute such adjustment or readjustment and prepare and furnish
to the Holder a certificate setting forth (i) the Conversion Price in effect at such time based upon the Dilutive Issuance, (ii) the
number of shares of Common Stock and the amount, if any, of other securities or property which at the time would be received upon
conversion of the Note, (iii) the detailed facts upon which such adjustment or readjustment is based, and (iv) copies of the
documentation (including but not limited to relevant transaction documents) that evidences the adjustment or readjustment. In
addition, the Borrower shall, within one (1) calendar day after each written request from the Holder, furnish to such Holder a like
certificate setting forth (i) the Conversion Price in effect at such time based upon the Dilutive Issuance, (ii) the number of
shares of Common Stock and the amount, if any, of other securities or property which at the time would be received upon conversion
of the Note, (iii) the detailed facts upon which such adjustment or readjustment is based, and (iv) copies of the documentation
(including but not limited to relevant transaction documents) that evidences the adjustment or readjustment. For the avoidance of
doubt, each adjustment or readjustment of the Conversion Price as a result of the events described in Section 1.6 of this Note shall
occur without any action by the Holder and regardless of whether the Borrower complied with the notification provisions in Section
1.6 of this Note.


 


1.7     
[Intentionally Omitted].


 


1.8     
Status as Shareholder. Upon submission of a Notice of Conversion by a Holder, (i) the Conversion Shares covered thereby
(other than the Conversion Shares, if any, which cannot be issued because their issuance would exceed such Holder’s allocated portion
of the Reserved Amount or Maximum Share Amount) shall be deemed converted into shares of Common Stock and (ii) the Holder’s rights
as a Holder of such converted portion of this Note shall cease and terminate, excepting only the right to receive certificates for such
shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure
by the Borrower to comply with the terms of this Note. Notwithstanding the foregoing, if a Holder has not received certificates for all
shares of Common Stock prior to the tenth (10th) business day after the expiration of the Deadline with respect to a conversion of any
portion of this Note for any reason, then (unless the Holder otherwise elects to retain its status as a holder of Common Stock by so notifying
the Borrower) the Holder shall regain the rights of a Holder of this Note with respect to such unconverted portions of this Note and the
Borrower shall, as soon as practicable, return such unconverted Note to the Holder or, if the Note has not been surrendered, adjust its
records to reflect that such portion of this Note has not been converted. In all cases, the Holder shall retain all of its rights and
remedies for the Borrower’s failure to convert this Note.


 


1.9      Prepayment.
At any time prior to the date that an Event of Default occurs under this Note (the “Prepayment Period”), the Borrower
shall have the right, exercisable on three (3) Trading Days prior written notice to the Holder of the Note, to prepay the
outstanding Principal Amount and interest then due under this Note in accordance with this Section 1.9. Any notice of prepayment
hereunder (an “Optional Prepayment Notice”) shall be delivered to the Holder of the Note at its registered addresses and
shall state: (1) that the Borrower is exercising its right to prepay the Note, and (2) the date of prepayment which shall be three
(3) Trading Days from the date of the Optional Prepayment Notice (the “Optional Prepayment Date”). The Holder shall have
the right, at all times prior to the actual receipt of the full prepayment amount on the Optional Prepayment Date, to instead
convert all or any portion of the Note pursuant to the terms of this Note, including the amount of this Note to be prepaid by the
Borrower in accordance with this Section 1.9, provided, however, that the Conversion Date is on or following the date that is six
(6) calendar months after the Issue Date. On the Optional Prepayment Date, the Borrower shall make payment of the amounts designated
below to or upon the order of the Holder as specified by the Holder in writing to the Borrower. If the Borrower exercises its right
to prepay the Note in accordance with this Section 1.9, the Borrower shall make payment to the Holder of an amount in cash equal to
the sum of: (w) 100% multiplied by the Principal Amount then outstanding plus (x) accrued and unpaid interest on the
Principal Amount to the Optional Prepayment Date plus (y) $750.00 to reimburse Holder for administrative fees.


 






    7


     


    

 


If the Borrower
delivers an Optional Prepayment Notice and fails to pay the applicable prepayment amount due to the Holder of the Note as provided in
this Section 1.9, then the Borrower shall forever forfeit its right to prepay any part of the Note pursuant to this Section 1.9.


 


1.10  
Repayment from Proceeds. If, at any time prior to the full repayment or full conversion of all


amounts
owed under this Note, the Company receives cash proceeds from any source or series of related or unrelated sources, including but not
limited to, from payments from customers, the issuance of equity or debt, the conversion of outstanding warrants of the Borrower, the
issuance of securities pursuant to an equity line of credit of the Borrower or the sale of assets, the Borrower shall, within one (1)
business day of Borrower’s receipt of such proceeds, inform the Holder of or publicly disclose such receipt, following which the
Holder shall have the right in its sole discretion to require the Borrower to immediately apply up to 40% of such proceeds to repay all
or any portion of the outstanding Principal Amount and interest (including any Default Interest) then due under this Note (provided, however,
that the aforementioned reference to 40% shall be reduced to 25% with respect to the initial $500,000 of gross proceeds received by the
Company solely pursuant to an equity line of credit). Failure of the Borrower to comply with this provision shall constitute an Event
of Default.


 


ARTICLE II.
RANKING AND CERTAIN COVENANTS


 


2.1 Ranking
and Security. This Note shall have priority over all unsecured indebtedness of the Borrower.


 


2.2 Other
Indebtedness. So long as the Borrower shall have any obligation under this Note, the Borrower shall not (directly or indirectly through
any Subsidiary or affiliate) incur or suffer to exist or guarantee any unsecured indebtedness that is senior to or pari passu with (in
priority of payment and performance) the Borrower’s obligations hereunder.


 


2.3 Distributions
on Capital Stock. So long as the Borrower shall have any obligation under this Note, the Borrower shall not without the Holder’s
written consent (a) pay, declare or set apart for such payment, any dividend or other distribution (whether in cash, property or other
securities) on shares of capital stock other than dividends on shares of Common Stock solely in the form of additional shares of Common
Stock or (b) directly or indirectly or through any subsidiary make any other payment or distribution in respect of its capital stock except
for distributions pursuant to any shareholders’ rights plan which is approved by a majority of the Borrower’s disinterested
directors.


 


 


2.4 Restriction
on Stock Repurchases and Debt Repayments. So long as the Borrower shall have any obligation under this Note, the Borrower shall
not without the Holder’s written consent redeem, repurchase or otherwise acquire (whether for cash or in exchange for property
or other securities or otherwise) in any one transaction or series of related transactions any shares of capital stock of the
Borrower or any warrants, rights or options to purchase or acquire any such shares, or repay any pari passu or subordinated
indebtedness of Borrower.


 


 


2.5 Sale
of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written
consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary course of business. Any consent
by the Holder to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition.


 


 


2.6 Advances
and Loans; Affiliate Transactions. So long as the Borrower shall have any obligation under this Note, the Borrower shall not,
without the Holder’s written consent, lend money, give credit, make advances to or enter into any transaction with any person,
firm, joint venture or corporation, including, without limitation, officers, directors, employees, subsidiaries and affiliates of
the Borrower, except loans, credits or advances (a) in existence or committed on the Issue Date and which the Borrower has informed
Holder in writing prior to the Issue Date, (b) in regard to transactions with unaffiliated third parties, made in the ordinary
course of business or (c) in regard to transactions with unaffiliated third parties, not in excess of $100,000. So long as the
Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, repay any
affiliate (as defined in Rule 144) of the Borrower in connection with any indebtedness or accrued amounts owed to any such
party.


 






    8


     


    

 





2.7 Section
3(a)(9) or 3(a)(10) Transaction. So long as this Note is outstanding, the Borrower shall not enter into any transaction or
arrangement structured in accordance with, based upon, or related or pursuant to, in whole or in part, either Section 3(a)(9) of the
Securities Act (a “3(a)(9) Transaction”) or Section 3(a)(10) of the Securities Act (a “3(a)(10)
Transaction”). In the event that the Borrower does enter into, or makes any issuance of Common Stock related to a 3(a)(9)
Transaction or a 3(a)(10) Transaction while this note is outstanding, a liquidated damages charge of 25% of the outstanding
principal balance of this Note, but not less than $25,000, will be assessed and will become immediately due and payable to the
Holder at its election in the form of a cash payment or added to the balance of this Note (under Holder's and Borrower's expectation
that this amount will tack back to the Issue Date).


 


2.8 Preservation
of Business and Existence, etc. So long as the Borrower shall have any obligation under this Note, the Borrower shall not,
without the Holder’s written consent, (a) change the nature of its business; (b) sell, divest, change the structure of any
material assets other than in the ordinary course of business; (c) enter into a Variable Rate Transaction; or (d) enter into any
merchant cash advance transactions. In addition, so long as the Borrower shall have any obligation under this Note, the Borrower
shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence, rights and privileges, and
become or remain, and cause each of its Subsidiaries (other than dormant Subsidiaries that have no or minimum assets) to become or
remain, duly qualified and in good standing in each jurisdiction in which the character of the properties owned or leased by it or
in which the transaction of its business makes such qualification necessary.


 


2.9 Noncircumvention.
The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate or Articles of Incorporation or
Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale
of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note,
and will at all times in good faith carry out all the provisions of this Note and take all action as may be required to protect the
rights of the Holder.


 


2.10 Lost,
Stolen or Mutilated Note. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by the
Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the Company
shall execute and deliver to the Holder a new Note.


 


ARTICLE
III. EVENTS OF DEFAULT


 


It shall
be considered an event of default if any of the following events listed in this Article III (each, an “Event of Default”)
shall occur:


 


3.1 Failure
to Pay Principal or Interest. The Borrower fails to pay the Principal Amount hereof or interest
thereon when due on this Note, whether at maturity, upon acceleration or otherwise, or fails to fully comply with Section 1.10 of this
Note.


 


3.2 Conversion
and the Shares. The Borrower (i) fails to issue Conversion Shares to the Holder (or announces
or threatens in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder
in accordance with the terms of this Note, (ii) fails to transfer or cause its transfer agent to transfer (issue) (electronically or in
certificated form) any certificate for the Conversion Shares issuable to the Holder upon conversion of or otherwise pursuant to this Note
as and when required by this Note, (iii) fails to reserve the Reserved Amount at all times, (iv) the Borrower directs its transfer agent
not to transfer or delays, impairs, and/or hinders its transfer agent in transferring (or issuing) (electronically or in certificated
form) any certificate for the Conversion Shares issuable to the Holder upon conversion of or otherwise pursuant to this Note as and when
required by this Note, or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer
agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for
any Conversion Shares issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or
makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and
any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded
in writing) for two (2) Trading Days after the Holder shall have delivered a Notice of Conversion, and/or (v) fails to remain current
in its obligations to its transfer agent (including but not limited to payment obligations to its transfer agent). It shall be an Event
of Default of this Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its
transfer agent. If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process
a conversion, such advanced funds shall be added to the principal balance of the Note.


 






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3.3 Breach
of Agreements and Covenants. The Borrower breaches any covenant, agreement, or other term
or condition contained in the Purchase Agreement, this Note, Irrevocable Transfer Agent Instructions, Warrant (as defined in the Purchase
Agreement) (the “Warrant”), or in any agreement, statement or certificate given in writing pursuant hereto or in connection
herewith or therewith.


 


3.4 Breach
of Representations and Warranties. Any representation or warranty of the Borrower made in
the Purchase Agreement, this Note, Irrevocable Transfer Agent Instructions, Warrant, or in any agreement, statement or certificate given
in writing pursuant hereto or in connection herewith or therewith shall be false or misleading in any material respect when made and the
breach of which has (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this
Note or the Purchase Agreement.


 


3.5 Receiver
or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors, or apply
for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such a
receiver or trustee shall otherwise be appointed.


 


3.6 Judgments.
Any money judgment, writ or similar process shall be entered or filed against the Borrower or any subsidiary of the Borrower or any of
its property or other assets for more than $100,000, and shall remain unvacated, unbonded or unstayed for a period of twenty (20) days
unless otherwise consented to by the Holder, which consent will not be unreasonably withheld.


 


3.7 Bankruptcy.
Bankruptcy, insolvency, reorganization or liquidation proceedings or other


 


proceedings,
voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the
Borrower or any subsidiary of the Borrower.


 


3.8 Failure
to Comply with the 1934 Act. At any time after the Issue Date, the Borrower shall fail


 


to comply
with the reporting requirements of the 1934 Act and/or the Borrower shall cease to be subject to the reporting requirements of the 1934
Act.


 


3.9 Liquidation.
Any dissolution, liquidation, or winding up of Borrower or any substantial


 


portion
of its business.


 


3.10 Cessation
of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise
generally unable to pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to
continue as a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.


 


3.11 Maintenance
of Assets. The failure by Borrower to maintain any material intellectual property
rights, personal, real property or other assets which are necessary to conduct its business (whether now or in the future).


 


3.12 Financial
Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC for any date or period from
two years prior to the Issue Date of this Note and until this Note is no longer outstanding.


 


3.13 Replacement
of Transfer Agent. In the event that the Borrower proposes to replace its transfer
agent, the Borrower fails to provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions
in a form as initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve
shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.


 






    10


     


    

 


3.14 Cross-Default.
The declaration of an event of default by any lender or other extender of credit to the Company
under any notes, loans, agreements or other instruments of the Company evidencing any indebtedness of the Company (including those filed
as exhibits to or described in the Company’s filings with the SEC), after the passage of all applicable notice and cure or grace
periods.


 


3.15 Variable
Rate Transactions. The Borrower consummates a Variable Rate Transaction at any time on
or after the Issue Date.


 


3.16 Inside
Information. Any attempt by the Borrower or its officers, directors, and/or affiliates to transmit,
convey, disclose, or any actual transmittal, conveyance, or disclosure by the Borrower or its officers, directors, and/or affiliates of,
material non-public information concerning the Borrower, to the Holder or its successors and assigns, which is not immediately cured by
Borrower’s filing of a Form 8-K pursuant to Regulation FD on that same date.


 


3.17 Unavailability
of Rule 144. If, at any time on or after the date that is six (6) calendar months after the
Issue Date, the Holder is unable to (i) obtain a standard “144 legal opinion letter” from an attorney reasonably acceptable
to the Holder, the Holder’s brokerage firm (and respective clearing firm), and the Borrower’s transfer agent in order to facilitate
the Holder’s conversion of any portion of the Note into free trading shares of the Borrower’s Common Stock pursuant to Rule
144, and/or (ii) thereupon deposit such shares into the Holder’s brokerage account.


 


3.18 Delisting,
Suspension, or Quotation of Trading of Common Stock. If, at any time on or after the Issue Date, the Borrower’s Common
Stock (i) is suspended from trading, (ii) halted from trading, and/or (iii) fails to be quoted or listed (as applicable) on a
Principal Market.


 


3.19 Rights
and Remedies Upon an Event of Default. Upon the occurrence of any Event of Default specified in this Article III, this Note
shall become immediately due and payable, and the Borrower shall pay to the Holder, in full satisfaction of its obligations
hereunder, an amount equal to the Principal Amount then outstanding plus accrued interest (including any Default Interest) through
the date of full repayment multiplied by 125% (collectively the “Default Amount”), as well as all costs, including,
without limitation, legal fees and expenses, of collection, all without demand, presentment or notice, all of which hereby are
expressly waived by the Borrower. Holder may, in its sole discretion, determine to accept payment part in Common Stock and part in
cash. For purposes of payments in Common Stock, the conversion formula set forth in Section 1.2 shall apply as well as all other
provisions of this Note. The Holder shall be entitled to exercise all other rights and remedies available at law or in equity. Upon
the occurrence of any Event of Default, and in addition to any other right or remedy of the Holder hereunder, under the related
transaction documents, or otherwise at law or in equity, the Borrower hereby irrevocably authorizes and empowers Holder or its legal
counsel, each as the Borrower’s attorney-in-fact, to appear ex parte and with notice to the Borrower to confess judgment
against the Borrower for the unpaid amount of this Note. The judgment shall set forth the amount then due hereunder, plus
attorney’s fees and cost of suit, and to release all errors, and waive all rights of appeal. The Borrower waives the right to
contest Holder’s rights under this section, including without limitation the right to any stay of execution and the benefit of
all exemption laws now or hereafter in effect. No single exercise of the foregoing right and power to confess judgment will be
deemed to exhaust such power, whether or not any such exercise shall be held by any court to be invalid, voidable, or void, and such
power shall continue undiminished and may be exercised from time to time as the Holder may elect until all amounts owing on this
Note have been paid in full. The Borrower shall provide a signed and notarized copy of the of the affidavit of confession of
judgment attached hereto as Exhibit “B” on or before the Closing Date.


 


ARTICLE
IV. MISCELLANEOUS


 


4.1 Failure
or Indulgence Not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privileges. All rights and remedies of the Holder existing
hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.


 






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4.2 Notices. All
notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and,
unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by
hand delivery, telegram, e-mail or facsimile, addressed as set forth below or to such other address as such party shall have
specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be
deemed effective (a) upon hand delivery or delivery by e-mail or facsimile, with accurate confirmation generated by the transmitting
facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such
notice is to be received), or the first business day following such delivery (if delivered other than on a business day during
normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by
express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first
occur. The addresses for such communications shall be:


 


If to the
Borrower, to:


 


ELECTROMEDICAL
TECHNOLOGIES, INC. 


16561
N. 92nd Street, Suite 101 Scottsdale, AZ 85260


Attention:
Matthew Wolfson


e-mail:
ir@electromedtech.com


 


If to the
Holder:


 


Talos
Victory Fund, LLC 


348 Cambridge
Street #101 

Woburn, MA 01801 

e-mail: admin@talosvf.com


 





 


4.3 Amendments.
This Note and any provision hereof may only be amended by an instrument in writing
signed by the Borrower and the Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall
mean this instrument as originally executed, or if later amended or supplemented, then as so amended or supplemented.


 


4.4 Assignability.
This Note shall be binding upon the Borrower and its successors and assigns, and shall
inure to be the benefit of the Holder and its successors and assigns. The Borrower shall not assign this Note or any rights or obligations
hereunder without the prior written consent of the Holder. The Holder may assign its rights hereunder to any “accredited investor”
(as defined in Rule 501(a) of the 1933 Act) in a private transaction from the Holder or to any of its “affiliates”, as that
term is defined under the 1934 Act, without the consent of the Borrower. Notwithstanding anything in this Note to the contrary, this Note
may be pledged as collateral in connection with a bona fide margin account or other lending arrangement. The Holder and any assignee,
by acceptance of this Note, acknowledge and agree that following conversion of a portion of this Note, the unpaid and unconverted principal
amount of this Note represented by this Note may be less than the amount stated on the face hereof.


 


4.5 Cost
of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection, including
reasonable attorneys’ fees.


 






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4.6 Governing
Law; Venue; Attorney’s Fees. This Note shall be governed by and construed
in accordance with the laws of the State of Delaware without regard to principles of conflicts of laws. Any action brought by either
party against the other concerning the transactions contemplated by this Note or any other agreement, certificate, instrument or document
contemplated hereby shall be brought only in the state courts located in the Commonwealth of Massachusetts or federal courts located
in the Commonwealth of Massachusetts. The Borrower hereby irrevocably waives any objection to jurisdiction and venue of any action instituted
hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. THE BORROWER
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTIONS CONTEMPLATED HEREBY. Each party hereby irrevocably waives personal
service of process and consents to process being served in any suit, action or proceeding in connection with this Note or any other agreement,
certificate, instrument or document contemplated hereby or thereby 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 in any other manner permitted by law. The prevailing party in any action or dispute brought in connection
with this the Note or any other agreement, certificate, instrument or document contemplated hereby or thereby shall be entitled to recover
from the other party its reasonable attorney’s fees and costs.


 


4.7 Certain
Amounts. Whenever pursuant to this Note the Borrower is required to pay an amount in excess
of the outstanding Principal Amount (or the portion thereof required to be paid at that time) plus accrued and unpaid interest plus Default
Interest on such interest, the Borrower and the Holder agree that the actual damages to the Holder from the receipt of cash payment on
this Note may be difficult to determine and the amount to be so paid by the Borrower represents stipulated damages and not a penalty and
is intended to compensate the Holder in part for loss of the opportunity to convert this Note and to earn a return from the sale of shares
of Common Stock acquired upon conversion of this Note at a price in excess of the price paid for such shares pursuant to this Note. The
Borrower and the Holder hereby agree that such amount of stipulated damages is not plainly disproportionate to the possible loss to the
Holder from the receipt of a cash payment without the opportunity to convert this Note into shares of Common Stock.


 


4.8 Purchase
Agreement. The Company and the Holder shall be bound by the applicable terms of the Purchase
Agreement and the documents entered into in connection herewith and therewith.


 


4.9 Notice
of Corporate Events. Except as otherwise provided below, the Holder of this Note shall have no rights as a Holder of Common
Stock unless and only to the extent that it converts this Note into Common Stock. The Borrower shall provide the Holder with prior
notification of any meeting of the Borrower’s shareholders (and copies of proxy materials and other information sent to
shareholders). In the event of any taking by the Borrower of a record of its shareholders for the purpose of determining
shareholders who are entitled to receive payment of any dividend or other distribution, any right to subscribe for, purchase or
otherwise acquire (including by way of merger, consolidation, reclassification or recapitalization) any share of any class or any
other securities or property, or to receive any other right, or for the purpose of determining shareholders who are entitled to vote
in connection with any change in control or any proposed liquidation, dissolution or winding up of the Borrower, the Borrower shall
mail a notice to the Holder, at least twenty (20) days prior to the record date specified therein (or thirty (30) days prior to the
consummation of the transaction or event, whichever is earlier), of the date on which any such record is to be taken for the purpose
of such dividend, distribution, right or other event, and a brief statement regarding the amount and character of such dividend,
distribution, right or other event to the extent known at such time. The Borrower shall make a public announcement of any event
requiring notification to the Holder hereunder substantially simultaneously with the notification to the Holder in accordance with
the terms of this Section 4.9.


 


4.10 Remedies.
The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable
harm to the Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges
that the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened
breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies
at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing
any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and
without any bond or other security being required.


 






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4.11 Construction;
Headings. This Note shall be deemed to be jointly drafted by the Company and all the
Holder and shall not be construed against any person as the drafter hereof. The headings of this Note are for convenience of reference
and shall not form part of, or affect the interpretation of, this Note.


 


4.12 Usury.
To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or
in any manner whatsoever claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever
enacted, now or at any time hereafter in force, in connection with any action or proceeding that may be brought by the Holder in order
to enforce any right or remedy under this Note. Notwithstanding any provision to the contrary contained in this Note, it is expressly
agreed and provided that the total liability of the Company under this Note for payments which under the applicable law are in the nature
of interest shall not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting
the foregoing, in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums which
under the applicable law in the nature of interest that the Company may be obligated to pay under this Note exceed such Maximum Rate.
It is agreed that if the maximum contract rate of interest allowed by applicable law and applicable to this Note is increased or decreased
by statute or any official governmental action subsequent to the Issue Date, the new maximum contract rate of interest allowed by law
will be the Maximum Rate applicable to this Note from the effective date thereof forward, unless such application is precluded by applicable
law. If under any circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Company to the Holder with respect to
indebtedness evidenced by this the Note, such excess shall be applied by the Holder to the unpaid principal balance of any such indebtedness
or be refunded to the Company, the manner of handling such excess to be at the Holder’s election.


 


4.13 Severability.
In the event that any provision of this Note is invalid or unenforceable under any applicable
statute or rule of law (including any judicial ruling), then such provision shall be deemed inoperative to the extent that it may conflict
therewith and shall be deemed modified to conform with such statute or rule of law.


 


Any such
provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision
of this Note.


 


4.14 Terms
of Future Financings. So long as this Note is outstanding, upon any issuance by the Borrower or any of its subsidiaries of any security,
or amendment to a security that was originally issued before the Issue Date, with any term that the Holder reasonably believes is more
favorable to the holder of such security or with a term in favor of the holder of such security that the Holder reasonably believes was
not similarly provided to the Holder in this Note, then (i) the Borrower shall notify the Holder of such additional or more favorable
term within one (1) business day of the issuance and/or amendment (as applicable) of the respective security, and (ii) such term, at Holder’s
option, shall become a part of the transaction documents with the Holder (regardless of whether the Borrower complied with the notification
provision of this Section 4.14). The types of terms contained in another security that may be more favorable to the holder of such security
include, but are not limited to, terms addressing prepayment rate, interest rates, and original issue discounts.


 


4.15 Dispute
Resolution. In the case of a dispute as to the determination of the Conversion Price, Conversion Amount, any prepayment amount or
Default Amount, Issue, Closing or Maturity Date, the closing bid price, or fair market value (as the case may be) or the arithmetic calculation
of the Conversion Price or the applicable prepayment amount(s) (as the case may be), the Borrower or the Holder shall submit the disputed
determinations or arithmetic calculations via facsimile (i) within one (1) Trading Day after receipt of the applicable notice giving rise
to such dispute to the Borrower or the Holder or (ii) if no notice gave rise to such dispute, at any time after the Holder learned of
the circumstances giving rise to such dispute. If the Holder and the Borrower are unable to agree upon such determination or calculation
within one (1) Trading Day of such disputed determination or arithmetic calculation (as the case may be) being submitted to the Borrower
or the Holder, then the Borrower shall, within one (1) Trading Day, submit (a) the disputed determination of the Conversion Price, the
closing bid price, the or fair market value (as the case may be) to an independent, reputable investment bank selected by the Borrower
and approved by the Holder or (b) the disputed arithmetic calculation of the Conversion Price, Conversion Amount, any prepayment amount
or Default Amount, to an independent, outside accountant selected by the Holder that is reasonably acceptable to the Borrower. The Borrower
shall cause at its expense the investment bank or the accountant to perform the determinations or calculations and notify the Borrower
and the Holder of the results no later than one (1) Trading Day from the time it receives such disputed determinations or calculations.
Such investment bank’s or accountant’s determination or calculation shall be binding upon all parties absent demonstrable
error.


 






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4.16 Right
of First Refusal. If at any time while this Note is outstanding, the Borrower has a bona fide offer of capital or financing from
any 3rd party, that the Borrower intends to act upon, then the Borrower must first offer such opportunity to the Holder to provide
such capital or financing to the Borrower on the same terms as each respective 3rd party’s terms. Should the Holder be
unwilling or unable to provide such capital or financing to the Borrower within five (5) Trading Days from Holder’s receipt of
written notice of the offer (the “Offer Notice”) from the Borrower, then the Borrower may obtain such capital or
financing from that respective 3rd party upon the exact same terms and conditions offered by the Borrower to the Holder, which
transaction must be completed within 30 days after the date of the Offer Notice. If the Borrower does not receive the capital or
financing from the respective 3rd party within 30 days after the date of the respective Offer Notice, then the Borrower must again
offer the capital or financing opportunity to the Holder as described above, and the process detailed above shall be repeated. The
Offer Notice must be sent via electronic mail to admin@talosvf.com.


 


[signature page follows]


 


IN WITNESS
WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer
on October 13, 2021.


 


ELECTROMEDICAL
TECHNOLOGIES, INC. 


 


	By:		 
	 	Name: Matthew
Wolfson
	 	Title:
Chief Executive Officer





 






    15


     


    

 


EXHIBIT
A -- NOTICE OF CONVERSION


 


The undersigned
hereby elects to convert $ principal amount of the Note (defined below) into that number of shares of Common Stock to be issued pursuant
to the conversion of the Note (“Common Stock”) as set forth below, of ELECTROMEDICAL TECHNOLOGIES, INC., a Delaware
corporation (the “Borrower”), according to the conditions of the promissory note of the Borrower dated as of October 13, 2021
(the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion, except for transfer taxes,
if any.


 


Box Checked
as to applicable instructions:





 


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

     

     

     
	
    The undersigned hereby
    requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers
    are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary,
    on an attachment hereto:

     

	 	Date of Conversion: 
	 	 
	 	Applicable Conversion Price:	$
	 	Number of Shares of Common Stock to be Issued Pursuant to

                                       Conversion of the Note:
	 

	 	Amount of Principal Balance Due remaining

                                       Under the Note after this conversion:
	 

	 	 	 
	 	By: 	 
	 	Name:	 
	 	Title:
Date:	 


 


EXHIBIT
B – CONFESSION OF JUDGMENT 


 


(see attached)


 






    


     


    

 


Affidavit of Confession
of Judgment


 


	
    COMMONWEALTH OF MASSACHUSETTS
	 	X
	 Talos Victory Fund, LLC,	 	 
	 	 	 
	 	 	Index No.
	 	 	 
	Plaintiff,	 	AFFIDAVIT OF CONFESSION OF
    
	- against -	 	JUDGMENT
	 	 	 
	ELECTROMEDICAL TECHNOLOGIES, INC.,
    	 	 
	Defendant.	 	
    X
	 	 	 
	COMMONWEALTH OF MASSACHUSETTS	 	)
	 	 	)         ss.:



 


Matthew Wolfson, being duly
sworn, hereby deposes and says:


 


1.           I
am the Chief Executive Officer of defendant ELECTROMEDICAL TECHNOLOGIES, INC., a Delaware corporation (“Borrower”). As such,
I am fully familiar with all the facts and circumstances recited herein on personal knowledge. Borrower has its principal place of business
at 16561 N. 92nd Street, Suite 101, Scottsdale, AZ 85260. On behalf of the Borrower, I hereby confess judgment in favor of TALOS VICTORY
FUND, LLC (“Holder”), residing at 348 Cambridge Street #101, Woburn, MA 01801, in the amount of $250,000.00, less any payments
made on or after the date of this affidavit of confession of judgment, plus Default Interest (as defined in the Note (as defined herein))
on said amount and all other applicable penalties under the Note. In no event shall interest payable hereunder exceed the maximum permissible
under applicable law.




 


 2.           I hereby authorize the federal courts and/or state courts located in the Commonwealth of Massachusetts to enter judgment against Borrower in the amount of in the amount of $250,000.00, less any payments made on or after the date of this affidavit of confession of judgment, plus Default Interest on said amount and all other applicable penalties under the Note, plus the costs and attorneys’ fees that are set forth below, less any payments made on or after the date of this affidavit of confession of judgment, upon Borrower’s failure for any reason to timely make any payment to Holder called for by the promissory note between of the parties, dated October 13, 2021 (the “Note”), due to the occurrence of an Event of Default (as defined in the Note) under the Note.




 






    


     


    

 


3.        In order to secure these obligations, Borrower
agreed to simultaneously deliver with the execution of the Note this Affidavit of Confession of Judgment.


 


 4.         The sums confessed pursuant to this affidavit of confession of judgment are justly due and owing to Holder under the following circumstances: Borrower entered into the Note pursuant to which Borrower promised to pay to the order of Holder the principal sum of $250,000.00 plus interest as provided for therein. The amounts confessed by this affidavit represent a promissory note investment by Holder in Borrower and arise out of Borrower’s breach of its obligations under the Note.




 


 5.          Borrower agrees to pay any and all costs and expenses incurred by Holder in enforcing the terms of this affidavit of confession of judgment, including reasonable attorneys’ fees and expenses at the rate of $475.00 per hour that Holder incurs or is billed for in connection with enforcing the terms of the affidavit of confession of judgment, entering any Judgment, collecting upon said Judgment, and defending or prosecuting any appeals.




 


[signature
page to follow] 


 






    


     


    

 


		ELECTROMEDICAL TECHNOLOGIES, INC.
	 	 	 
	 	By:	 
	 	 	Name: Matthew Wolfson
	 	 	Title: Chief
Executive Officer



 





	STATE OF	 	)
	 	 	ss.:
	COUNTY OF	 	)
	 	 	 



 


ACKNOWLEDGMENT


 


On __________, 2021 before
me personally came ________________________________________, to me known, who, by me duly sworn, did depose and say that deponent is an
officer of ELECTROMEDICAL TECHNOLOGIES, INC., the corporation described in, and which executed the foregoing affidavit of confession of
judgment, that deponent knows the seal of the corporation, that the seal affixed to the affidavit of confession of judgment is the corporation’s
seal, that it was affixed by order of the board of directors of the corporation and that deponent signed deponent’s name by like
order.


 






    


     


    

 


			 
	 	Notary Public	 
	 	SEAL:	 



 


[Signature Page
to Affidavit of Confession of Judgment] 


 






    


    

\