Exhibit 10.3


 


 





 


THE SECURITIES OFFERED
HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER (THE "1933 ACT)


 


 


 US $32,812.50 


 


AGRITEK HOLDINGS, INC.


8% CONVERTIBLE REDEEMABLE NOTE


DUE DECEMBER 13, 2017


BACK END NOTE


 


FOR VALUE RECEIVED,
AGRITEK HOLDINGS, Inc. (the “Company”) promises to pay to the order of LG CAPITAL FUNDING, LLC and its authorized successors
and permitted assigns ("Holder"), the aggregate principal face amount of Thirty Two Thousand Eight Hundred Twelve
Dollars 50/100 cents exactly (U.S. $32,812.50) on December 13, 2017 ("Maturity Date") and to pay interest on the
principal amount outstanding hereunder at the rate of 8% per annum commencing on December 13, 2016. The interest will be paid to
the Holder in whose name this Note is registered on the records of the Company regarding registration and transfers of this Note.
The principal of, and interest on, this Note are payable at 1218 Union Street, Suite #2, Brooklyn, NY 11225, initially, and if
changed, last appearing on the records of the Company as designated in writing by the Holder hereof from time to time. The Company
will pay each interest payment and the outstanding principal due upon this Note on the Maturity Date, less any amounts required
by law to be deducted or withheld, to the Holder of this Note by check or wire transfer addressed to such Holder at the last address
appearing on the records of the Company. The forwarding of such check or wire transfer shall constitute a payment of outstanding
principal hereunder and shall satisfy and discharge the liability for principal on this Note to the extent of the sum represented
by such check or wire transfer. Interest shall be payable in Common Stock (as defined below) pursuant to paragraph 4(b) herein.


 


This Note is subject
to the following additional provisions:


 


1.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 made for such registration
or transfer or exchange, except that Holder shall pay any tax or other governmental charges payable in connection therewith.


 


2.The Company shall be entitled
to withhold from all payments any amounts required to be withheld under applicable laws.


 


3.This Note may be transferred
or exchanged only in compliance with the Securities Act of 1933, as amended ("Act") and applicable state securities
laws. Any attempted transfer to a non-qualifying party shall be treated by the Company as void. Prior to due presentment for transfer
of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company's
records as the owner hereof for all other purposes, whether or not this Note be overdue, and neither the Company nor any such agent
shall be affected or bound by notice to the contrary. Any Holder of this Note electing to exercise the right of conversion set
forth in Section 4(a) hereof, in addition to the requirements set forth in Section 4(a), and any prospective transferee of this
Note, also is required to give the Company written confirmation that this Note is being converted ("Notice of Conversion")
in the form annexed hereto as Exhibit A. The date of receipt (including receipt by telecopy) of such Notice of Conversion
shall be the Conversion Date.


 


4.(a)The Holder of this Note
is entitled, at its option, after full cash payment for the shares convertible hereunder, to convert all or any amount of
the principal face amount of this Note then outstanding into shares of the Company's common stock (the "Common Stock"),
at a price ("Conversion Price") for each share of Common Stock equal to 58% of the lowest closing bid price
of the Common Stock as reported on the OTCQB maintained by the OTC Markets Group, Inc. upon which the Company’s shares
are traded or any exchange upon which the Common Stock may be traded in the future ("Exchange"), for the eighteen
prior trading days including the day upon which a Notice of Conversion is received by the Company or its transfer agent
(provided such Notice of Conversion is delivered by fax or other electronic method of communication to the Company or its transfer
agent after 4 P.M. Eastern Standard or Daylight Savings Time if the Holder wishes to include the same day closing price). If the
shares have not been delivered within 3 business days, the Notice of Conversion may be rescinded. Such conversion shall be effectuated
by the Company delivering the shares of Common Stock to the Holder within 3 business days of receipt by the Company of the Notice
of Conversion. Accrued but unpaid interest shall be subject to conversion. No fractional shares or scrip representing fractions
of shares will be issued on conversion, but the number of shares issuable shall be rounded to the nearest whole share. To
the extent the Conversion Price of the Company’s Common Stock closes below the par value per share, the Company will take
all steps necessary to solicit the consent of the stockholders to reduce the par value to the lowest value possible under law.
The Company agrees to honor all conversions submitted pending this increase. In the event the Company experiences a DTC “Chill”
on its shares, the conversion price shall be decreased to 48% instead of 58% while that “Chill” is in effect. In
no event shall the Holder be allowed to effect a conversion if such conversion, along with all other shares of Company Common Stock
beneficially owned by the Holder and its affiliates would exceed 9.9% of the outstanding shares of the Common Stock of the Company.


 


(b)Interest on any unpaid principal
balance of this Note shall be paid at the rate of 8% per annum. Interest shall be paid by the Company in Common Stock ("Interest
Shares"). Holder may, at any time, send in a Notice of Conversion to the Company for Interest Shares based on the formula
provided in Section 4(a) above. The dollar amount converted into Interest Shares shall be all or a portion of the accrued interest
calculated on the unpaid principal balance of this Note to the date of such notice.


 


(c)This Note may not be prepaid,
except that if the $32,812.50 Rule 144 convertible redeemable note issued by the Company of even date herewith is redeemed by the
Company within 6 months of the issuance date of such Note, all obligations of the Company under this Note and all obligations of
the Holder under the Holder issued Back End Note will be automatically be deemed satisfied and this Note and the Holder issued
Back End Note will be automatically be deemed cancelled and of no further force or effect.


 


(d) Upon (i) a transfer of all
or substantially all of the assets of the Company to any person in a single transaction or series of related transactions, (ii)
a reclassification, capital reorganization or other change or exchange of outstanding shares of the Common Stock, or (iii) any
consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity (other
than a merger which is effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification,
conversion or exchange of outstanding shares of Common Stock solely into shares of Common Stock) (each of items (i), (ii) and (iii)
being referred to as a "Sale Event"), then, in each case, the Company shall, upon request of the Holder, redeem this
Note in cash for 150% of the principal amount, plus accrued but unpaid interest through the date of redemption, or at the election
of the Holder, such Holder may convert the unpaid principal amount of this Note (together with the amount of accrued but unpaid
interest) into shares of Common Stock immediately prior to such Sale Event at the Conversion Price.


 


(e) In case of any Sale Event
in connection with which this Note is not redeemed or converted, the Company shall cause effective provision to be made so that
the Holder of this Note shall have the right thereafter, by converting this Note, to purchase or convert this Note into the kind
and number of shares of stock or other securities or property (including cash) receivable upon such reclassification, capital reorganization
or other change, consolidation or merger by a holder of the number of shares of Common Stock that could have been purchased upon
exercise of the Note and at the same Conversion Price, as defined in this Note, immediately prior to such Sale Event. The foregoing
provisions shall similarly apply to successive Sale Events. If the consideration received by the holders of Common Stock is other
than cash, the value shall be as determined by the Board of Directors of the Company or successor person or entity acting in good
faith.


 


5.No provision of this Note shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this
Note at the time, place, and rate, and in the form, herein prescribed.


 


6.The Company hereby expressly
waives demand and presentment for payment, notice of non-payment, protest, notice of protest, notice of dishonor, notice of acceleration
or intent to accelerate, and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily
liable for the payment of all sums owing and to be owing hereto.


 


7.The Company agrees to pay all
costs and expenses, including reasonable attorneys' fees and expenses, which may be incurred by the Holder in collecting any amount
due under this Note.


 


8.If one or more of the following
described "Events of Default" shall occur:


 


(a)The Company shall default in
the payment of principal or interest on this Note or any other note issued to the Holder by the Company; or


 


(b)Any of the representations
or warranties made by the Company herein or in any certificate or financial or other written statements heretofore or hereafter
furnished by or on behalf of the Company in connection with the execution and delivery of this Note, or the Securities Purchase
Agreement under which this note was issued shall be false or misleading in any material respect; or


 


(c)The Company shall fail to perform
or observe, in any respect, any covenant, term, provision, condition, agreement or obligation of the Company under this Note or
any other note issued to the Holder; or


 


(d)The Company shall (1) become
insolvent; (2) admit in writing its inability to pay its debts generally as they mature; (3) make an assignment for the benefit
of creditors or commence proceedings for its dissolution; (4) apply for or consent to the appointment of a trustee, liquidator
or receiver for its or for a substantial part of its property or business; (5) file a petition for bankruptcy relief, consent to
the filing of such petition or have filed against it an involuntary petition for bankruptcy relief, all under federal or state
laws as applicable; or


 


(e)A trustee, liquidator or receiver
shall be appointed for the Company or for a substantial part of its property or business without its consent and shall not be discharged
within thirty (30) days after such appointment; or


 


(f)Any governmental agency or
any court of competent jurisdiction at the instance of any governmental agency shall assume custody or control of the whole or
any substantial portion of the properties or assets of the Company; or


 


(g)One or more money judgments,
writs or warrants of attachment, or similar process, in excess of fifty thousand dollars ($50,000) in the aggregate, shall be entered
or filed against the Company or any of its properties or other assets and shall remain unpaid, unvacated, unbonded or unstayed
for a period of fifteen (15) days or in any event later than five (5) days prior to the date of any proposed sale thereunder; or


 


(h)defaulted on or breached any
term of any other note of similar debt instrument into which the Company has entered and failed to cure such default within the
appropriate grace period; or


 


(i)The Company shall have its
Common Stock delisted from a trading market (including the OTC BB market) or, if the Common Stock trades on an exchange, then trading
in the Common Stock shall be suspended for more than 10 consecutive days or ceases to file its 1934 act reports with the SEC;


 


(j)If a majority of the members
of the Board of Directors of the Company on the date hereof are no longer serving as members of the Board;


 


(k)The Company shall not deliver
to the Holder the Common Stock pursuant to paragraph 4 herein without restrictive legend within 3 business days of its receipt
of a Notice of Conversion; or


 


(l) The Company shall not replenish
the reserve set forth in Section 12, within 3 business days of the request of the Holder.


 


(m)The Company’s Common
Stock has a closing bid price of less than $0.01 per share for at least 5 consecutive trading days; or


 


(n) The aggregate dollar trading
volume of the Company’s Common Stock is less than thirty thousand dollars ($30,000.00) in any 5 consecutive trading days;
or


 


(o) The Company shall cease to
be “current” in its filings with the Securities and Exchange Commission; or


 


(p) The Company shall
lose the “bid” price for its stock in a market (including the OT marketplace or other exchange)


 


Then, or at any time thereafter, unless
cured (except for 8(m) and 8(n) which are incurable defaults, the sole remedy of which is to allow the Holder to cancel
both this Note and the Holder Issued Note, and in each and every such case, unless such Event of Default shall have been waived
in writing by the Holder (which waiver shall not be deemed to be a waiver of any subsequent default) at the option of the Holder
and in the Holder's sole discretion, the Holder may consider this Note immediately due and payable, without presentment, demand,
protest or (further) notice of any kind (other than notice of acceleration), all of which are hereby expressly waived, anything
herein or in any note or other instruments contained to the contrary notwithstanding, and the Holder may immediately, and without
expiration of any period of grace, enforce any and all of the Holder's rights and remedies provided herein or any other rights
or remedies afforded by law. Upon an Event of Default, interest shall accrue at a default interest rate of 24% per annum or, if
such rate is usurious or not permitted by current law, then at the highest rate of interest permitted by law. In the event of a
breach of Section 8(k) the penalty shall be $250 per day the shares are not issued beginning on the 4th day after the
conversion notice was delivered to the Company. This penalty shall increase to $500 per day beginning on the 10th day.
The penalty for a breach of Section 8(p) shall be an increase of the outstanding principal amounts by 20%. In case of a breach
of Section 8(i), the outstanding principal due under this Note shall increase by 50%. Further, if a breach of Section 8(o) occurs
or is continuing after the 6 month anniversary of the Note, then the Holder shall be entitled to use the lowest closing bid price
during the delinquency period as a base price for the conversion. For example, if the lowest closing bid price during the delinquency
period is $0.01 per share and the conversion discount is 50% the Holder may elect to convert future conversions at $0.005 per share.
If this Note is not paid at maturity, the outstanding principal due under this Note shall increase by 10%.


 


If the Holder shall commence an action
or proceeding to enforce any provisions of this Note, including, without limitation, engaging an attorney, then if the Holder prevails
in such action, the Holder shall be reimbursed by the Company for its attorneys’ fees and other costs and expenses incurred
in the investigation, preparation and prosecution of such action or proceeding.


 


Make-Whole for Failure
to Deliver Loss. At the Holder’s election, if the Company fails for any reason to deliver to the Holder the conversion shares
by the by the 3rd business day following the delivery of a Notice of Conversion to the Company and if the Holder incurs a Failure
to Deliver Loss, then at any time the Holder may provide the Company written notice indicating the amounts payable to the Holder
in respect of the Failure to Deliver Loss and the Company must make the Holder whole as follows:


 


Failure to Deliver Loss = [(High trade
price at any time on or after the day of exercise) x (Number of conversion shares)]


 


The Company must pay the Failure to Deliver
Loss by cash payment, and any such cash payment must be made by the third business day from the time of the Holder’s written
notice to the Company.


 


9.In case any provision of this
Note is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision
shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and
enforceability of the remaining provisions of this Note will not in any way be affected or impaired thereby.


 


10.Neither this Note nor any term
hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the Company and the Holder.


 


11.The Company represents that
it is not a “shell” issuer and has not been a “shell” issuer for the 12 months following the Company’
having reported Form 10 type information indicating it is no longer a “shell issuer.


 


12.Prior to cash funding of this
Note, The Company will issue irrevocable transfer agent instructions reserving 3x the number of shares of Common Stock necessary
to allow the holder to convert this note based on the discounted conversion price set forth in Section 4(a) herewith. Upon full
conversion of this Note, the reserve representing this Note shall be cancelled. The Company will pay all transfer agent costs associated
with issuing and delivering the shares. If such amounts are to be paid by the Holder, it may deduct such amounts from the Conversion
Price. Conversion Notices may be sent to the Company or its transfer agent via electric mail. The Company will instruct its transfer
agent to provide the outstanding share information to the Holder in connection with its conversions.


 


13.The Company will give the Holder
direct notice of any corporate actions, including but not limited to name changes, stock splits, recapitalizations etc. This notice
shall be given to the Holder as soon as possible under law.


 


14.This Note
shall be governed by and construed in accordance with the laws of New York applicable to contracts made and wholly to be performed
within the State of New York and shall be binding upon the successors and assigns of each party hereto. The Holder and the Company
hereby mutually waive trial by jury and consent to exclusive jurisdiction and venue in the courts of the State of New York or
in the federal courts sitting in the city or county of New York. This Agreement may be executed in counterparts, and the facsimile
transmission of an executed counterpart to this Agreement shall be effective as an original.






    	 	 	 



     


    




IN WITNESS WHEREOF,
the Company has caused this Note to be duly executed by an officer thereunto duly authorized.


 


 


Dated:         12/13/16        


 


 


 


AGRITEK HOLDINGS, INC.


 


By: /s/ B. Michael Friedman


 


Title:
Chief Executive Officer



 






    	 	 	 



     


    

EXHIBIT A


 


 


NOTICE OF CONVERSION


 


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


 


The undersigned hereby
irrevocably elects to convert $___________ of the above Note into _________ Shares of Common Stock of AGRITEK HOLDINGS, Inc. (“Shares”)
according to the conditions set forth in such Note, as of the date written below.


 


If Shares are to be
issued in the name of a person other than the undersigned, the undersigned will pay all transfer and other taxes and charges payable
with respect thereto.


 


Date of Conversion: ___________________________________________________


Applicable Conversion Price: ____________________________________________


Signature: ___________________________________________________________


[Print Name of Holder and Title of Signer]


Address:  ___________________________________________________________


 ___________________________________________________________


 


SSN or EIN: _______________________


Shares are to be registered in the following name: _____________________________________


 


Name: _____________________________________________________________


Address: ___________________________________________________________


Tel: ______________________________


Fax: ______________________________


SSN or EIN: _______________________


 


Shares are to be sent or delivered to the following account:


 


Account Name: ______________________________________________________


Address: ___________________________________________________________