Exhibit 10.3


 


	ACAR
	 


 


CONVERTIBLE
NOTE


 


FOR
VALUE RECEIVED, ActiveCare, Inc., a Delaware corporation (the “Issuer” of this Security) with at least 239,000,000
common shares issued and outstanding, issues this Security and promises to pay to __________________., a Cayman Islands company,
or its Assignees (the “Investor”) the Principal Sum along with the Interest Rate and any other fees according to the
terms herein. This Note will become effective only upon execution by both parties and delivery of the first payment of Consideration
by the Investor (the “Effective Date”).


 


The
Principal Sum is $_______ (______________) plus accrued and unpaid interest and any other fees. The Consideration is $_________
(________) payable by wire (there exists a $________ original issue discount (the “OID”)). The Investor shall pay
$__________of Consideration upon closing of this Note as the Purchase Price under the Securities Purchase Agreement Document SPA-12072017
of even date herewith between the Issuer and the Investor. Any term not otherwise defined herein shall have the meaning given
such term in the Securities Purchase Agreement.


 


1.       Interest
and Repayment. No interest shall accrue on this Note. The Maturity Date is six months after the Effective Date and is the
date upon which the Principal Sum of this Note, as well as any unpaid interest and other fees, shall be due and payable. The Investor
may extend any Maturity Date in its sole discretion in increments of up to three months at any time before or after any Maturity
Date. The Issuer may repay this Note at any time on or before its Maturity Date.


 


2.       Note
Conversion into Private Placement. At the closing of the Private Placement the Note shall automatically convert into a subscription
into the Private Placement in an amount equal to 125% of the Note balance, subject to the following conditions: (i) 90% of the
debt listed on Schedule A of the Securities Purchase Agreement must convert into shares of common stock of the Issuer at the Private
Placement price per share, including, without limitation, all debt (and preferred stock) held by insiders and affiliates of the
Issuer (as indicated by the blue highlighting on Schedule A); (ii) the Private Placement raises at least $5,000,000 of net new
money for the Issuer, not including any conversions of the Bridge Financing or conversions of the debt on Schedule A; (iii) no
commission is paid to a placement agent in connection with the conversion and subscription into the Private Placement of the Note,
the other Bridge Financing, or the conversion of the debt on Schedule A; (iv) the Warrant and the Origination Shares being issued
under the Securities Purchase Agreement will not be cancelled or converted into the Private Placement; and (v) the Private Placement
closes on or before May 5, 2018.


 


3.       Conversion
upon Default on Repayment. In the event the Issuer fails to repay the balance due under this Note on its Maturity Date, the
Investor has the right, at any time, at its election, to convert all or part of the outstanding and unpaid Principal Sum and accrued
interest (and any other fees) into shares of fully paid and non-assessable shares of common stock of the Issuer as per this conversion
formula: Number of shares receivable upon conversion equals the dollar conversion amount divided by the Conversion Price. The
Conversion Price is the lesser of $3.00 (subject to adjustment for stock splits) or 60% of the lowest trade price in the 25 trading
days previous to the conversion (In the case that conversion shares are not deliverable by DWAC an additional 10% discount will
apply; and if the shares are ineligible for deposit into the DTC system and only eligible for Xclearing deposit an additional
5% discount shall apply; in the case of both an additional cumulative 15% discount shall apply). Unless otherwise agreed in writing
by both parties, at no time will the Investor convert any amount of the Note into common stock that would result in the Investor
owning more than 9.99% of the common stock outstanding. Conversion notices may be delivered to the Issuer by method of the Investor’s
choice (including but not limited to email, facsimile, mail, overnight courier, or personal delivery), and all conversions shall
be cashless and not require further payment from the Investor. If no objection is delivered from the Issuer to the Investor regarding
any variable or calculation of the conversion notice within 24 hours of delivery of the conversion notice, the Issuer shall have
been thereafter deemed to have irrevocably confirmed and irrevocably ratified such notice of conversion and waived any objection
thereto. The Issuer shall deliver the shares from any conversion to the Investor (in any name directed by the Investor) within
3 (three) business days of conversion notice delivery. The Investor, at any time prior to selling all of the shares from a conversion,
may, for any reason, rescind any portion, in whole or in part, of that particular conversion attributable to the unsold shares
and have the rescinded conversion amount returned to the Principal Sum with the rescinded conversion shares returned to the Issuer
(under the Investor’s and the Issuer’s expectations that any returned conversion amounts will tack back to the original
date of the Note).


 


4.       Conversion
Upon Issuance of a Variable Security. If, at any time this Note is outstanding, the Issuer issues a Variable Security, then
in such event the Investor shall have the right to convert all or any portion of the outstanding balance of this Note into shares
of the Issuer’s common stock on the same terms as granted in any applicable Variable Security issued by the Issuer (including,
for the avoidance of doubt, conversion price, conversion discount, conversion lookback period, method and timing of conversion
share delivery, etc.). A Variable Security is any security issued by the Issuer that (i) has or may have conversion rights of
any kind, contingent, conditional or otherwise in which the number of shares that may be issued pursuant to such conversion right
varies with the market price of the common stock; (ii) is or may become convertible into common stock (including without limitation
convertible debt, warrants or convertible preferred stock), with a conversion price that varies with the market price of the common
stock, even if such security only becomes convertible following an event of default, the passage of time, or another trigger event
or condition; or (iii) was issued or may be issued in the future in exchange for or in connection with any contract or instrument,
whether convertible or not, where the number of shares of common stock issued or to be issued is based upon or related in any
way to the market price of the common stock, including, but not limited to, common stock issued in connection with a Section 3(a)(9)
exchange, a Section 3(a)(10) settlement, or any other similar settlement or exchange.


 


5.       Reservation
of Shares. The Issuer will reserve for the Investor from its authorized and unissued Common Stock a number of shares of not
less than five times the number of shares necessary to provide for the issuance of Common Stock upon the full conversion of this
Note.


 






     


    


    

 


6.       Terms
of Future Financings. Until such time as the closing of the Private Placement, upon any issuance by the Issuer of any security
with any term more favorable to the holder of such security or with a term in favor of the holder of such security that was not
similarly provided to the Investor in this Note, such term, at the Investor’s option, shall become a part of the transaction
documents with the Investor. 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 conversion rights, conversion discounts, conversion lookback periods,
interest rates, original issue discounts, and warrant coverage.


 


In
addition, until such time as the closing of the Private Placement, if the Issuer shall issue or sell Common Stock, or grant any
option to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant
or any option to purchase or other disposition) any Common Stock (including pursuant to the terms of any outstanding securities
issued prior to the issuance of this security (including, but not limited to, warrants, convertible notes, or other agreements))
or any security entitling the holder thereof (including pursuant to sales, grants, conversions, warrant exercises or other issuances
to the Investor as a result of these Transaction Documents (as defined below), prior transaction documents, or future transaction
documents) to acquire Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other
instrument that is convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive Common
Stock (a “Common Stock Equivalent”) at an effective price per share less than the Conversion Price, then simultaneously
with the consummation of each dilutive issuance the Conversion Price for the Investor shall be reduced (and only reduced) and
consequently the number of Shares issuable to the Investor shall be increased (and only increased). Such adjustment shall be made
to the Conversion Price whenever such Common Stock or Common Stock Equivalents are issued.


 


The
Issuer shall notify the Investor of such additional or more favorable term, including the applicable issuance price, or applicable
reset price, exchange price, conversion price, exercise price and other pricing terms, and, at any time while this Note is outstanding,
the Investor may request of the Issuer and/or its transfer agent (and they will provide) a schedule of all issuances since the
Effective Date of this Note of shares of common stock or of securities entitling the holder thereof to acquire shares of common
stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is convertible
into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, shares of common stock of the Issuer.


 


7.       Default.
Each of the following are an event of default under this Note: (i) the Issuer shall fail to pay any principal under the Note when
due and payable (or payable by conversion) thereunder; or (ii) the Issuer shall fail to pay any interest or any other amount under
the Note when due and payable (or payable by conversion) thereunder; or (iii) the Issuer shall breach or fail to honor any other
term of this Note, any term under any other document related to this Note, or any term of any of the other Transaction Documents;
or (iv) the Issuer shall become insolvent or generally fails to pay, or admits in writing its inability to pay, its debts as they
become due, subject to applicable grace periods, if any; or (v) the Issuer shall make a general assignment for the benefit of
creditors; or (vi) the Issuer shall file a petition for relief under any bankruptcy, insolvency or similar law (domestic or foreign);
or (vii) an involuntary proceeding shall be commenced or filed against the Issuer.


 


8.       Remedies.
For each conversion, in the event that shares are not delivered by the fourth business day (inclusive of the day of conversion),
a fee of $2,000 per day will be assessed for each day after the third business day (inclusive of the day of the conversion) until
share delivery is made; and such fee will be added to the Principal Sum of the Note (under the Investor’s and the Issuer’s
expectations that any penalty amounts will tack back to the original date of the Note). The parties agree that the fee shall be
applied to the balance of the Note and shall tack back to the Effective Date of the Note for purposes of Rule 144. The parties
acknowledge and agree that upon an event of default, Investor’s damages would be uncertain and difficult (if not impossible)
to accurately estimate because of the parties’ inability to predict future interest rates and future share prices, Investor’s
increased risk, and the uncertainty of the availability of a suitable substitute investment opportunity for Investor, among other
reasons. Accordingly, any fees, charges, and default interest due under this Note or any other Transaction Document between the
parties are intended by the parties to be, and shall be deemed, liquidated damages. The parties agree that such liquidated damages
are a reasonable estimate of Investor’s actual damages and not a penalty, and shall not be deemed in any way to limit any
other right or remedy Investor may have hereunder, at law or in equity. The parties acknowledge and agree that under the circumstances
existing at the time this Note is entered into, such liquidated damages are fair and reasonable and are not penalties. All fees,
charges, and default interest provided for in this Note and the Transaction Documents are agreed to by the parties to be based
upon the obligations and the risks assumed by the parties as of the Effective Date and are consistent with investments of this
type. The liquidated damages provisions shall not limit or preclude a party from pursuing any other remedy available at law or
in equity; provided, however, that the liquidated damages are intended to be in lieu of actual damages.


 


9.       Acceleration.
In the event of any default, the outstanding principal amount of this Note, plus accrued but unpaid interest, liquidated damages,
fees and other amounts owing in respect thereof through the date of acceleration (the “Note Balance”), shall become,
at the Investor’s election, immediately due and payable in cash at the Mandatory Default Amount. The Mandatory Default Amount
means the Investor’s choice of (this choice may be made at any time without presentment, demand, or notice of any kind):
(i) the Note Balance divided by the Conversion Price on the date of the default multiplied by the closing price on the date of
the default; or (ii) the Note Balance divided by the Conversion Price on the date the Mandatory Default Amount is either (a) demanded
or (b) paid in full, whichever has a lower Conversion Price, multiplied by the closing price on the date the Mandatory Default
Amount is either (a) demanded or (b) paid in full, whichever has a higher closing price; or (iii) 150% of the Note Balance. In
connection with such acceleration described herein, the Investor need not provide, and the Issuer hereby waives, any presentment,
demand, protest or other notice of any kind, and the Investor may immediately and without expiration of any grace period enforce
any and all of its rights and remedies hereunder and all other remedies available to it under applicable law. Such acceleration
may be rescinded and annulled by the Investor at any time prior to payment hereunder and the Investor shall have all rights as
a holder of the note until such time, if any, as the Investor receives full payment pursuant to this Section 9. No such rescission
or annulment shall affect any subsequent event of default or impair any right consequent thereon.


 






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10.       Right
to Specific Performance and Injunctive Relief. Nothing herein shall limit the Investor’s right to pursue any other remedies
available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.
In this regard, the Issuer hereby agrees that the Investor will be entitled to obtain specific performance and/or injunctive relief
with respect to the Issuer’s failure to timely deliver shares of Common Stock upon conversion of the Note as required pursuant
to the terms hereof or the Issuer’s obligations regarding the reservation of shares and its transfer agent, including the
use, termination, replacement or resignation of the transfer agent and the obligation to deliver an irrevocable instruction and
share reservation letter with any subsequent transfer agent. The Issuer agrees that, in such event, all requirements for specific
performance and/or preliminary and permanent injunctive relief will be satisfied, including that the Investor would suffer irreparable
harm for which there would be no adequate legal remedy. The Issuer further agrees that it will not object to a court or arbitrator
granting or ordering specific performance or preliminary and/or permanent injunctive relief in the event the Investor demonstrates
that the Issuer has failed to comply with any obligation herein. Such a grant or order may require the Issuer to immediately issue
shares to the Investor pursuant to a Conversion Notice and/or require the Issuer to immediately satisfy its obligations regarding
the reservation of shares and its transfer agent, including the use, termination, replacement or resignation of the Issuer’s
transfer agent and the obligation to deliver an irrevocable instruction and share reservation letter with any subsequent transfer
agent. The Issuer further expressly waives any right to any bond in connection with any temporary or preliminary injunction.


 


11.       No
Shorting. The Investor agrees that so long as this Note from the Issuer to the Investor remains outstanding, the Investor
will not enter into or effect “short sales” of the Common Stock or hedging transaction which establishes a net short
position with respect to the Common Stock of the Issuer. The Issuer acknowledges and agrees that upon delivery of a conversion
notice by the Investor, the Investor immediately owns the shares of Common Stock described in the conversion notice and any sale
of those shares issuable under such conversion notice would not be considered short sales.


 


12.       Assignability.
The Issuer may not assign this Note. This Note will be binding upon the Issuer and its successors and will inure to the benefit
of the Investor and its successors and assigns and may be assigned by the Investor to anyone without the Issuer’s approval.


 


13.       Governing
Law, Legal Proceedings, and Arbitration. This Note will be governed by, construed and
enforced in accordance with the substantive laws of the State of Nevada (including any rights to specific relief provided for
under Nevada statutes), without regard to the conflict of laws principles thereof. The parties hereby warrant and represent that
the selection of Nevada law as governing under this Note (i) has a reasonable nexus to each of the Parties and to the transactions
contemplated by the Note; and (ii) does not offend any public policy of Nevada, Florida, or of any other state, federal, or other
jurisdiction.


 


Any
action brought by either party against the other arising out of or related to this Note, or any other agreements between the parties,
shall be commenced only in the state or federal courts of general jurisdiction located in Miami-Dade County, in the State of Florida,
except that all such disputes between the parties shall be subject to alternative dispute resolution through binding arbitration
at the Investor’s sole discretion and election (regardless of which party initiates the legal proceedings). The
parties agree that, in connection with any such arbitration proceeding, each shall submit or file any claim which would constitute
a compulsory counterclaim within the same proceeding as the claim to which it relates. Any such claim that is not submitted or
filed in such proceeding shall be waived and such party will forever be barred from asserting such a claim. Both parties and the
individuals signing this Note agree to submit to the jurisdiction of such courts or to such arbitration panel, as the case may
be.


 


If
the Investor elects alternative dispute resolution by arbitration, the arbitration proceedings shall be conducted in Miami-Dade
County and administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules and Mediation
Procedures in effect on the Effective Date of this Note, except as modified by this agreement. The Investor’s election to
arbitrate shall be made in writing, delivered to the other party, and filed with the American Arbitration Association. The American
Arbitration Association must receive the demand for arbitration prior to the date when the institution of legal or equitable proceedings
would be barred by the applicable statute of limitations, unless legal or equitable proceedings between the parties have already
commenced, and the receipt by the American Arbitration Association of a written demand for arbitration also shall constitute the
institution of legal or equitable proceedings for statute of limitations purposes. The parties shall be entitled to limited discovery
at the discretion of the arbitrator(s) who may, but are not required to, allow depositions. The parties acknowledge that the arbitrators’
subpoena power is not subject to geographic limitations. The arbitrator(s) shall have the right to award individual relief which
he or she deems proper under the evidence presented and applicable law and consistent with the parties’ rights to, and limitations
on, damages and other relief as expressly set forth in this Note. The award and decision of the arbitrator(s) shall be conclusive
and binding on all parties, and judgment upon the award may be entered in any court of competent jurisdiction. The Investor reserves
the right, but shall have no obligation, to advance the Issuer’s share of the costs, fees and expenses of any arbitration
proceeding, including any arbitrator fees, in order for such arbitration proceeding to take place, and by doing so will not be
deemed to have waived or relinquished its right to seek the recovery of those amounts from the arbitrator, who shall provide for
such relief in the final award, in addition to the costs, fees, and expenses that are otherwise recoverable. The foregoing agreement
to arbitrate shall be specifically enforceable under applicable law in any court having jurisdiction thereof.


 






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14.       Delivery
of Process by the Investor to the Issuer. In the event of any action or proceeding by the Investor against the Issuer, and
only by the Investor against the Issuer, service of copies of summons and/or complaint and/or any other process which may be served
in any such action or proceeding may be made by the Investor via U.S. Mail, overnight delivery service such as FedEx or UPS, email,
fax, or process server, or by mailing or otherwise delivering a copy of such process to the Issuer at its last known attorney
as set forth in its most recent SEC filing.


 


15.       Attorney
Fees. If any attorney is employed by either party with regard to any legal or equitable action, arbitration or other proceeding
brought by such party for enforcement of this Note or because of an alleged dispute, breach, default or misrepresentation in connection
with any of the provisions of this Note, the prevailing party will be entitled to recover from the other party reasonable attorneys'
fees and other costs and expenses incurred, in addition to any other relief to which the prevailing party may be entitled.


 


16.       Opinion
of Counsel. RESERVED


 


17.       Notices.
Any notice required or permitted hereunder (including Conversion Notices and demands for arbitration) must be in writing and either
personally served, sent by facsimile or email transmission, or sent by overnight courier. Notices will be deemed effectively delivered
at the time of transmission if by facsimile or email, and if by overnight courier the business day after such notice is deposited
with the courier service for delivery.


 


*       *       *


 





	Issuer:	 	Investor:
	 	 	 
	 	 	 
	Jeffrey S. Peterson	 	 
	ActiveCare, Inc.	 	 
	Chief Executive Officer	 	 
	 	 	 
	Date:  	                         	 	Date: 	                         




 


 


[Convertible
Note Signature Page]


 


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