Exhibit 10.2


 


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 COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE
FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING
THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT
SECURED BY THE SECURITIES.


 


	Principal Amount: US$56,000.00	Issue Date: December 6, 2017


 


CONVERTIBLE PROMISSORY
NOTE


 


FOR VALUE RECEIVED, NIGHTFOOD
HOLDINGS, INC., a Nevada corporation (hereinafter called the “Borrower” or “Company”), hereby promises
to pay to the order of LABRYS FUND, LP, a Delaware limited partnership, or registered assigns (the “Holder”)
the sum of US$56,000.00, together with any interest as set forth herein, on June 6, 2018 (the “Maturity Date”), and
to pay interest on the unpaid principal balance hereof at the rate of twelve percent (12%) (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.


 


This Note may be prepaid in whole or in
part except as set forth herein. Any amount of principal or interest on this Note which is not paid when due shall bear interest
at the rate of the lesser of (i) twenty-four percent (24%) per annum or (ii) the maximum amount allowed by law from the due date
thereof until the same is paid (the “Default Interest”). Interest shall commence accruing on the date that the Note
is fully paid and 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 common stock, $0.0001 par value per share (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 and, in the case of any interest payment date which is not the date on
which this Note is paid in full, the extension of the due date thereof shall not be taken into account for purposes of determining
the amount of interest due on such date. 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. Each capitalized term used herein, and not otherwise defined, shall have the meaning ascribed thereto in
that certain Securities Purchase Agreement dated the date hereof, pursuant to which this Note was originally issued (the “Purchase
Agreement”).


 




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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. This Note, so long as it is not
in Default, shall not be assigned without the written consent of the Borrower.


 


The following terms shall apply to this Note:


 


ARTICLE I. CONVERSION RIGHTS


 


1.1 Conversion Right. The Holder
shall have the right, in its sole and absolute discretion, from time to time, and at any time on or following the date that is
180 days after the Issue Date and ending on the later of (i) the Maturity Date and (ii) the date of payment of the Default Amount
(as defined in Article III) pursuant to Section 1.6(a) or Article III, each in respect of the remaining outstanding principal amount
of this Note to convert all or any part of the outstanding and unpaid principal amount of this Note into fully paid and non-assessable
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 in no event shall the Holder be entitled to convert
any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of
Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially
owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted portion of any other security
of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number
of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to which the determination of this
proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding
shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined
in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations
13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided, further, however, that the limitations
on conversion may be waived by the Holder (up to a maximum of 9.99%) upon, at the election of the Holder, not less than 61 days’
prior notice to the Borrower, and the provisions of the conversion limitation shall continue to apply until such 61st day (or such
later date, as determined by the Holder, as may be specified in such notice of waiver). The number of shares of Common Stock 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 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 before 11:59 p.m., New York, New York time on such conversion date (the “Conversion Date”).


 




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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 rates
provided in this Note to the Conversion Date, provided however, that the Borrower shall have the right to pay any or all interest
in cash, 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), plus (4) any Additional Principal for such Conversions, plus (5) at the Holder’s
option, any amounts owed to the Holder pursuant to any other provision of this Note, all subject to the 4.99% (or up to 9.99% if
increased as provided above) limitation discussed above.


 


1.2 Conversion Price.


 


(a) Calculation of Conversion Price.
Subject to the adjustments described herein, the conversion price (the “Conversion Price”) shall equal the lesser of
(i) 50% multiplied by the lowest Trading Price (as defined below) (representing a discount rate of 50%) during the previous twenty-five
(25) Trading Day period ending on the latest complete Trading Day prior to the date of this Note and (ii) the Alternate Conversion
Price (as defined herein)(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). The “Alternate Conversion Price” shall mean 50%
multiplied by the Market Price (as defined herein) (representing a discount rate of 50%). “Market Price” means the
lowest Trading Price (as defined below) for the Common Stock during the twenty-five (25) Trading Day period ending on the latest
complete Trading Day prior to the Conversion Date. “Trading Price” means, for any security as of any date, the lesser
of: (i) the lowest trade price on the OTC Pink, OTCQB, or applicable trading market (the “OTC Market”) as reported
by a reliable reporting service (“Reporting Service”) designated by the Holder or, if the OTC Market is not the principal
trading market for such security, the trading price of such security on the principal securities exchange or trading market where
such security is listed or traded or, if no trading price of such security is available in any of the foregoing manners, the average
of the trading prices of any market makers for such security that are listed in the “pink sheets” by the National Quotation
Bureau, Inc., or (ii) the lowest closing bid price on the OTC Market as reported by a Reporting Service designated by the Holder
or, if the OTC Market is not the principal trading market for such security, the closing bid price of such security on the principal
securities exchange or trading market where such security is listed or traded or, if no closing bid price of such security is available
in any of the foregoing manners, the average of the closing bid prices of any market makers for such security that are listed in
the “pink sheets” by the National Quotation Bureau, Inc. If the Trading Price cannot be calculated for such security
on such date in the manner provided above, the Trading Price shall be the fair market value as mutually determined by the Borrower
and the holders of a majority in interest of the Notes being converted for which the calculation of the Trading Price is required
in order to determine the Conversion Price of such Notes. “Trading Day” shall mean any day on which the Common Stock
is tradable for any period on the OTC Market or on the principal securities exchange or other securities market on which the Common
Stock is then being traded. The Borrower shall be responsible for the fees of its transfer agent and all DTC fees associated with
any such issuance. In the event of any dispute or discrepancy, the records of the Holder shall be controlling and determinative
in the absence of manifest error.


 




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Each time, while this Note is outstanding,
the Borrower enters into a Section 3(a)(9) transaction (including but not limited to the issuance of new promissory notes or of
a replacement promissory note), or Section 3(a)(10) transaction, in which any 3rd party has the right to convert monies
owed to that 3rd party (or receive shares pursuant to a settlement or otherwise) at a discount to market greater than
the Alternate Conversion Price in effect at that time (prior to all other applicable adjustments in the Note), then the Alternate
Conversion Price shall be automatically adjusted to such greater discount percentage (prior to all applicable adjustments in this
Note) until this Note is no longer outstanding. Each time, while this Note is outstanding, the Borrower enters into a Section 3(a)(9)
transaction (including but not limited to the issuance of new promissory notes or of a replacement promissory note), or Section
3(a)(10) transaction, in which any 3rd party has a look back period greater than the look back period in effect under the Note
at that time, then the Holder’s look back period shall automatically be adjusted to such greater number of days until this
Note is no longer outstanding. The Borrower shall give written notice to the Holder, with the adjusted Alternate Conversion Price
and/or adjusted look back period (each adjustment that is applicable due to the triggering event), within one (1) business day
of an event that requires any adjustment described in the two immediately preceding sentences.


 


(b) Adjustment to Conversion Price.
At any time after the Issue Date, (i) if in the case that the Borrower’s Common Stock is not deliverable by DWAC (including
if the Borrower’s transfer agent has a policy prohibiting or limiting delivery of shares of the Borrower’s Common Stock
specified in a Notice of Conversion), (ii) if the Borrower ceases to be a reporting company pursuant or subject to the Exchange
Act, (iii) if the Borrower loses a market (including the OTCBB, OTCQB or an equivalent replacement exchange) for its Common Stock,
(iv) if the Borrower fails to maintain its status as “DTC Eligible” for any reason, (v) if the Conversion Price is
less than one cent ($0.01), (vi) if the Note cannot be converted into free trading shares on or after six months from the Issue
Date, (vii) if at any time the Borrower does not maintain or replenish the Reserved Amount (as defined herein) within three (3)
business days of the request of the Holder, (viii) if the Borrower fails to maintain the listing of the Common Stock on at least
one of the OTC Markets or an equivalent replacement exchange, the Nasdaq National Market, the Nasdaq Small Cap Market, the New
York Stock Exchange, or the NYSE MKT, (ix) if the Borrower fails to comply with the reporting requirements of the Exchange Act;
the reporting requirements necessary to satisfy the availability of Rule 144 to the Holder or its assigns, including but not limited
to the timely fulfillment of its filing requirements as a fully-reporting issuer registered with the SEC, the requirements for
XBRL filings, the requirements for disclosure of financial statements on its website, (x) if the Borrower effectuates a reverse
split of its Common Stock without twenty (20) days prior written notice to the Holder, (xi) if OTC Markets changes the Borrower’s
designation to ‘No Information’ (Stop Sign), ‘Caveat Emptor’ (Skull and Crossbones), or ‘OTC’,
‘Other OTC’ or ‘Grey Market’ (Exclamation Mark Sign), (xii) 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, if the result of such restatement would, by comparison to the unrestated financial statement, have constituted
a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement, (xiii) any cessation
of trading of the Common Stock on at least one of the OTC Markets or an equivalent replacement exchange, the Nasdaq National Market,
the Nasdaq Small Cap Market, the New York Stock Exchange, or the NYSE MKT, and such cessation of trading shall continue for a period
of five consecutive (5) Trading Days, (xiv) the Borrower loses the “bid” price for its Common Stock ($0.0001 on the
“Ask” with zero market makers on the “Bid” per Level 2), (xv) if the Holder is notified in writing by the
Company or the Company’s transfer agent that the Company does not have the necessary amount of authorized and issuable shares
of Common Stock available to satisfy the issuance of Shares pursuant to a Conversion Notice, and/or (xvi) an event of default occurs
under Section 3.11 of the Note (regardless of whether the Holder has declared the Note in default or not), then the Holder shall
be entitled to increase, by 10% for each occurrence, cumulative or otherwise, the discount to the Conversion Price shall apply
for all future conversions under the Note. The Holder maintains the option and sole discretion to increase by Five Thousand and
No/100 United States Dollars ($5,000) per each occurrence described above (under Holder’s and Borrower’s expectation
that any principal amount increase will tack back to the Issue Date) the principal amount of the Note instead of applying further
discounts to the Conversion Price. Under no circumstances shall the principal amount exceed an additional Twenty Five Thousand
and No/100 United States Dollars ($25,000) or the Conversion Price be less than 30% multiplied by the Market Price due to cumulative
effect.


 




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(c) DTC Chill. If in the case that
the Borrower’s Common Stock is “chilled” for deposit into the DTC system and only eligible for clearing deposit,
then an additional 15% discount to the Conversion Price shall apply for all future conversions under all Notes while the “chill”
is in effect.


 


(d) [Intentionally Omitted]. 


 


(e) Par Value Adjustments. To the
extent the Conversion Price of the Borrower’s Common Stock closes below the par value per share, the Borrower 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
Borrower agrees to honor all conversions submitted pending this adjustment, provided, however, that the Holder, in its sole and
absolute discretion, may elect to instead to set the Conversion Price to par value for such Conversion(s) and the Conversion Amount
for such Conversion(s) shall 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(s) to equal the same number of Conversion Shares as would have been issued had the Conversion Price not been
set to par value pursuant to this Section 1.2(e).


 


(f) Conversion Price During Major Announcements.
Notwithstanding anything contained in the preceding section to the contrary, in the event the Borrower (i) makes a public announcement
that it intends to consolidate or merge with any other corporation (other than a merger in which the Borrower is the surviving
or continuing corporation and its capital stock is unchanged) or sell or transfer all or substantially all of the assets of the
Borrower or (ii) any person, group or entity (including the Borrower) publicly announces a tender offer to purchase 50% or more
of the Borrower's Common Stock (or any other takeover scheme) (the date of the announcement referred to in clause (i) or (ii) is
hereinafter referred to as the "Announcement Date"), then the Conversion Price shall, effective upon the Announcement
Date and continuing through the Adjusted Conversion Price Termination Date (as defined below), be equal to the lower of (x) the
Conversion Price which would have been applicable for a Conversion occurring on the Announcement Date and (y) the Conversion Price
that would otherwise be in effect. From and after the Adjusted Conversion Price Termination Date, the Conversion Price shall be
determined as set forth in this Section. For purposes hereof, "Adjusted Conversion Price Termination Date" shall mean,
with respect to any proposed transaction or tender offer (or takeover scheme) for which a public announcement as contemplated by
this Section has been made, the date upon which the Borrower (in the case of clause (i) above) or the person, group or entity (in
the case of clause (ii) above) consummates or publicly announces the termination or abandonment of the proposed transaction or
tender offer (or takeover scheme) which caused this Section 1.2(d) to become operative.


 


(g) Pro Rata Conversion; Disputes.
In the event of a dispute as to the number of shares of Common Stock issuable to the Holder in connection with a conversion of
this Note, the Borrower shall issue to the Holder the number of shares of Common Stock not in dispute and resolve such dispute
in accordance with Section 4.13.


 




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1.3 Authorized Shares. The Borrower
covenants that during the period the conversion right exists, 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 Common Stock upon the full conversion
of this Note issued pursuant to the Purchase Agreement. The Borrower is required at all times to have authorized and reserved seven
(7) times the number of shares that is actually issuable upon full conversion of the Note (based on the Conversion Price of the
Notes in effect from time to time) (the “Reserved Amount”). Initially, the Company will instruct the Transfer Agent
to reserve 14,000,000 shares of common stock in the name of the Holder for issuance upon conversion hereof. The Reserved
Amount shall be increased from time to time in accordance with the Borrower’s obligations pursuant to Section 3(d) of the
Purchase Agreement. The Borrower represents that upon issuance, such shares will be duly and validly issued, fully paid and non-assessable.
In addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number
of shares of Common Stock into which the Notes shall be convertible at the then current Conversion Price, the Borrower shall at
the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized
and reserved, free from preemptive rights, for conversion of the outstanding Notes. If, at any time the Borrower does not maintain
the Reserved Amount it will be considered an Event of Default under Section 3.2 of the Note, and the then outstanding principal
due under this Note shall increase by Fifteen Thousand and No/100 United States Dollars ($15,000).


 


The Borrower (i) acknowledges that it has
irrevocably instructed its transfer agent to issue certificates for the Common Stock issuable upon conversion of this Note, 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 to execute and issue the necessary certificates for shares of Common Stock in accordance with
the terms and conditions of this Note. Notwithstanding the foregoing, in no event shall the Reserved Amount be lower than the initial
Reserved Amount, regardless of any prior conversions, and the Reserved Amount will be increased by a factor of two (2) each time
the Borrower issues a Variable Security (as defined herein).


 


1.4 Method of Conversion.


 


(a) Mechanics of Conversion. Subject
to Section 1.1, this Note may be converted by the Holder in whole or in part at any time on or following the date that is 180 days
after the Issue Date, by (A) submitting to the Borrower 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) and (B) subject to Section 1.4(b),
surrendering this Note at the principal office of the Borrower.


 


(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 of this Note 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 Borrower 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.


 




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(c) Book Entry 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 of this
Note 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 Borrower
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.


 


(d) 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. 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 Common Stock issuable upon such conversion within two (2) business days after
such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid principal amount hereof,
surrender of this Note) in accordance with the terms hereof and the Purchase Agreement.


 


(e) Delivery of Common Stock Upon Conversion.
Upon receipt by the Borrower 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 Common Stock issuable upon
such conversion within two (2) business days after such receipt (the “Deadline”) (and, solely in the case of conversion
of the entire unpaid principal amount hereof, surrender of this Note) in accordance with the terms hereof and the Purchase Agreement.


 




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(f) Obligation of Borrower to Deliver
Common Stock. Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder of record
of the Common Stock issuable upon such conversion, the outstanding principal amount and the amount of accrued and unpaid interest
on 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 Common Stock
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 received
by the Borrower before 11:59 p.m., New York, New York time, on such date.


 


(g) Delivery of Common Stock by Electronic
Transfer. In lieu of delivering physical certificates representing the Common Stock issuable upon conversion, provided the
Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer (“FAST”)
program, 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 commercially reasonable best efforts to cause its transfer agent to electronically transmit the Common Stock
issuable upon conversion to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit Withdrawal
At Custodian (“DWAC”) system.


 


(i) Failure to Deliver Common Stock
Prior to Delivery Deadline. Without in any way limiting the Holder’s right to pursue other remedies, including actual
damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is
not delivered by the Deadline (other than a failure due to the circumstances described in Section 1.3 above, which failure shall
be governed by such Section) the Borrower shall pay to the Holder $2,000 per day in cash, for each day beyond the Deadline that
the Borrower fails to deliver such Common Stock until the Borrower issues and delivers a certificate to the Holder or credit the
Holder's balance account with OTC for the number of shares of Common Stock to which the Holder is entitled upon such Holder's conversion
of any Conversion Amount (under Holder's and Borrower's expectation that any damages will tack back to the Issue Date). Such cash
amount shall be paid to Holder by the fifth day of the month following the month in which it has accrued or, at the option of the
Holder (by written notice to the Borrower by the first day of the month following the month in which it has accrued), shall be
added to the principal amount of this Note, in which event interest shall accrue thereon in accordance with the terms of this Note
and such additional principal amount shall be convertible into Common Stock in accordance with the terms of this Note. The Borrower
agrees that the right to convert is a valuable right to the Holder. The damages resulting from a failure, attempt to frustrate,
and interference with such conversion right are difficult if not impossible to qualify. Accordingly the parties acknowledge that
the liquidated damages provision contained in this Section 1.4(i) are justified.


 




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(j) Rescindment of a Notice of Conversion.
If (i) the Borrower fails to respond to Holder within one (1) business day from the Conversion Date confirming the details of Notice
of Conversion, (ii) the Borrower fails to provide any of the shares of the Borrower’s Common Stock requested in the Notice
of Conversion within two (2) business days from the Conversion Date specified therein, (iii) the Holder is unable to procure a
legal opinion required to have the shares of the Borrower’s Common Stock issued unrestricted and/or deposited to sell for
any reason related to the Borrower’s standing, (iv) the Holder is unable to deposit the shares of the Borrower’s Common
Stock requested in the Notice of Conversion for any reason related to the Borrower’s standing, (v) at any time after a missed
Deadline, at the Holder’s sole discretion, (vi) if, within three (3) business days of the transmittal of the Notice of Conversion
to the Borrower, the Common Stock has a closing bid which is 5% or lower than that set forth in the Notice of Conversion, or (vii)
if OTC Markets changes the Borrower's designation to ‘Limited Information’ (Yield), ‘No Information’ (Stop
Sign), ‘Caveat Emptor’ (Skull & Crossbones), ‘OTC’, ‘Other OTC’ or ‘Grey Market’
(Exclamation Mark Sign) or other trading restriction on the day of or any day after the Conversion Date, then the Holder maintains
the option and sole discretion to rescind the applicable Notice of Conversion (“Rescindment”) pursuant to which such
Conversion Shares were issuable with a “Notice of Rescindment.” This Note shall remain convertible before and after
the Maturity Date hereof until this Note is repaid or converted in full.


 


1.5 Concerning the Shares. The shares
of Common Stock 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 Act or (ii) the Borrower or its transfer agent shall have been furnished with an
opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions)
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 under the Act (or a successor rule) (“Rule 144”)
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 shares of Common Stock issuable upon conversion of this Note have been registered under the Act or otherwise may
be sold pursuant to Rule 144 without any restriction as to the number of securities as of a particular date that can then be immediately
sold, each certificate for shares of Common Stock issuable upon conversion of this Note 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 COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR
FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”


 


The legend set forth above shall be removed
and the Borrower shall issue to the Holder a new certificate therefore free of any transfer legend if (i) the Borrower or its transfer
agent shall have received an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions,
to the effect that a public sale or transfer of such Common Stock may be made without registration under the Act, which opinion
shall be reasonably accepted by the Borrower so that the sale or transfer is effected or (ii) in the case of the Common Stock issuable
upon conversion of this Note, such security is registered for sale by the Holder under an effective registration statement filed
under the Act or otherwise may be sold pursuant to Rule 144 without any restriction as to the number of securities as of a particular
date that can then be immediately sold. In the event that the Borrower does not accept the opinion of counsel provided by the Buyer
with respect to the transfer of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation S, at the
Deadline, it will be considered an Event of Default pursuant to Section 3.2 of the Note.


 




    	 	9	 



     


    

 


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,
the effectuation by the Borrower of a transaction or series of related transactions in which more than 50% of the voting power
of the Borrower is disposed of, 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
(as defined in Article III) 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 (as defined in Article III) 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 the Notes, 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 affect any transaction described in this Section 1.6(b) unless (a) it first
gives, to the extent practicable, 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) [Intentionally Omitted].


 




    	 	10	 



     


    

 


(d) [Intentionally Omitted].


 


The Borrower shall be deemed to have issued
or sold shares of Common Stock if the Borrower in any manner issues or grants any warrants, rights or options (not including employee
stock option plans), whether or not immediately exercisable, to subscribe for or to purchase Common Stock or other securities convertible
into or exchangeable for Common Stock (“Convertible Securities”) (such warrants, rights and options to purchase Common
Stock or Convertible Securities are hereinafter referred to as “Options”) and the price per share for which Common
Stock is issuable upon the exercise of such Options is less than the Conversion Price then in effect, then the Conversion Price
shall be equal to such price per share. For purposes of the preceding sentence, the “price per share for which Common Stock
is issuable upon the exercise of such Options” is determined by dividing (i) the total amount, if any, received or receivable
by the Borrower as consideration for the issuance or granting of all such Options, plus the minimum aggregate amount of additional
consideration, if any, payable to the Borrower upon the exercise of all such Options, plus, in the case of Convertible Securities
issuable upon the exercise of such Options, the minimum aggregate amount of additional consideration payable upon the conversion
or exchange thereof at the time such Convertible Securities first become convertible or exchangeable, by (ii) the maximum total
number of shares of Common Stock issuable upon the exercise of all such Options (assuming full conversion of Convertible Securities,
if applicable). No further adjustment to the Conversion Price will be made upon the actual issuance of such Common Stock upon the
exercise of such Options or upon the conversion or exchange of Convertible Securities issuable upon exercise of such Options.


 


Additionally, the Borrower shall be deemed
to have issued or sold shares of Common Stock if the Borrower in any manner issues or sells any Convertible Securities, whether
or not immediately convertible (other than where the same are issuable upon the exercise of Options), and the price per share for
which Common Stock is issuable upon such conversion or exchange is less than the Conversion Price then in effect, then the Conversion
Price shall be equal to such price per share. For the purposes of the preceding sentence, the “price per share for which
Common Stock is issuable upon such conversion or exchange” is determined by dividing (i) the total amount, if any, received
or receivable by the Borrower as consideration for the issuance or sale of all such Convertible Securities, plus the minimum aggregate
amount of additional consideration, if any, payable to the Borrower upon the conversion or exchange thereof at the time such Convertible
Securities first become convertible or exchangeable, by (ii) the maximum total number of shares of Common Stock issuable upon the
conversion or exchange of all such Convertible Securities. No further adjustment to the Conversion Price will be made upon the
actual issuance of such Common Stock upon conversion or exchange of such Convertible Securities.


 


(e) Purchase Rights. If, at any
time when 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.


 




    	 	11	 



     


    

 


(f) Notice of Adjustments. Upon
the occurrence of each adjustment or readjustment of the Conversion Price as a result of the events described in this Section 1.6,
the Borrower, at its expense, shall promptly compute such adjustment or readjustment and prepare and furnish to the Holder a certificate
setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based.
The Borrower shall, upon the written request at any time of the Holder, furnish to such Holder a like certificate setting forth
(i) such adjustment or readjustment, (ii) the Conversion Price at the time in effect and (iii) 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. It shall
not be an Event of Default if Borrower fails to do give such notice.


 


1.7 [Intentionally Omitted].


 


1.8 Status as Shareholder. Upon
submission of a Notice of Conversion by a Holder, (i) the shares covered thereby (other than the 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 third (3rd) 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 (including, without limitation, (i) the right to receive Conversion Default Payments pursuant to Section
1.3 to the extent required thereby for such Conversion Default and any subsequent Conversion Default and (ii) the right to have
the Conversion Price with respect to subsequent conversions determined in accordance with Section 1.3) for the Borrower’s
failure to convert this Note.


 




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1.9 Prepayment. Notwithstanding
anything to the contrary contained in this Note, the Borrower may prepay the amounts outstanding hereunder pursuant to the following
terms and conditions:


 


(a) At any time during the period beginning
on the Issue Date and ending on the date which is one hundred eighty (180) days following the Issue Date, the Borrower shall have
the right, exercisable on not less than three (3) Trading Days prior written notice to the Holder of the Note, to prepay the outstanding
Note in full by making a payment to the Holder of an amount in cash equal to the sum of: (i) the then outstanding principal amount
of this Note plus (ii) accrued and unpaid interest on the unpaid principal amount of this Note plus (iii) Default
Interest, if any, in accordance with Article III, plus (iv) any Additional Principal, plus (v) at the Holder’s
option, any amounts owed to the Holder pursuant to any other provision of this Note, plus (vi) $750.00 (the “Fee”).


 


(b) At any time during the period
beginning on the Issue Date and ending on the date which is one hundred eighty (180) days following the Issue Date, the
Borrower may have the right, exercisable on not less than three (3) Trading Days prior written notice to the Holder of the
Note, and subject to the Holder’s written approval at such time, to prepay any amount outstanding under the Note
(subject to a minimum $10,000.00 payment), provided, however, that all partial payments shall be applied first to all
interest accrued under the Note at the time of the respective partial payment, second to the principal under the Note, and
third to the Fee and/or other applicable amounts owed hereunder.


 


(b) After the expiration of one hundred
eighty (180) days following the date of the Note, the Borrower shall have no right of prepayment.


 


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 not more than three
(3) Trading Days from the date of the Optional Prepayment Notice. On the date fixed for prepayment (the “Optional Prepayment
Date”), the Borrower shall make payment of the applicable prepayment amount to or upon the order of the Holder as specified
by the Holder in writing to the Borrower at least one (1) business day prior to the Optional Prepayment Date.


 


If the Borrower delivers an Optional Prepayment
Notice and fails to pay the applicable prepayment amount due to the Holder of the Note within two (2) business days following the
Optional Prepayment Date, then the Borrower shall forever forfeit its right to prepay the Note pursuant to this Section 1.9.


 




    	 	13	 



     


    

 


ARTICLE II. CERTAIN COVENANTS


 


2.1 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.


 


2.2 Restriction on Stock Repurchases.
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.


 


2.3 Borrowings; Liens. So long as
the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, create,
incur, assume guarantee, endorse, contingently agree to purchase or otherwise become liable upon the obligation of any person,
firm, partnership, joint venture or corporation, except by the endorsement of negotiable instruments for deposit or collection,
or suffer to exist any liability for borrowed money, except (a) borrowings in existence or committed on the date hereof and of
which the Borrower has informed Holder in writing prior to the date hereof, (b) indebtedness to trade creditors financial institutions
or other lenders incurred in the ordinary course of business, (c) borrowings, the proceeds of which shall be used to repay this
Note, or (ii) enter into, create or incur any liens, claims or encumbrances of any kind, on or with respect to any of its property
or assets now owned or hereafter acquired or any interest therein or any income or profits therefrom, securing any indebtedness
occurring after the date hereof.


 


2.4 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 to the disposition
of any assets may be conditioned on a specified use of the proceeds of disposition.


 


2.5 Advances and Loans. 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 or make advances to 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 date hereof and which the Borrower has informed Holder in writing prior to the date hereof, (b) made in the ordinary course
of business or (c) not in excess of $100,000.


 




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2.6 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, Section 3(a)(l0) of the Securities Act (a “3(a)(l0) Transaction”).
In the event that the Borrower does enter into, or makes any issuance of Common Stock related to a 3(a)(l0) Transaction while this
note is outstanding, a liquidated damages charge of 25% of the outstanding principal balance of this Note, but not less than Fifteen
Thousand Dollars ($15,000), 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).


 


2.7 Preservation of Existence, etc.
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.


 


2.8 Non-circumvention. The Borrower
hereby covenants and agrees that the Borrower 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.


 


2.9 Charter. So long as the
Borrower shall have any obligations under this Note, the Borrower shall not amend its charter documents, including without
limitation its certificate of incorporation and bylaws, in any manner that materially and adversely affects any rights of the
Holder.


 


ARTICLE III. EVENTS OF DEFAULT


 


If any of the following events of default (each, an “Event
of Default”) shall occur:


 


3.1 Failure to Pay Principal or Interest.
The Borrower fails to pay the principal hereof or interest thereon when due on this Note, whether at maturity, upon acceleration
or otherwise. Any amount of principal on this Note which is not paid when due shall bear interest at the rate of Twenty Four percent
(24%) per annum from the due date thereof until the same is paid (“Default Interest”).


 




    	 	15	 



     


    

 


3.2 Conversion and the Shares. The
Borrower fails to reserve the Reserved Amount required for Holder at any time after the Issue Date, issue shares of Common Stock
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, fails to transfer or cause its transfer agent
to transfer (issue) (electronically or in certificated form) any certificate for shares of Common Stock issued to the Holder upon
conversion of or otherwise pursuant to this Note as and when required by this Note, 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 shares of Common Stock to be issued 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 shares of Common Stock 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) business days after the Holder shall have delivered a Notice
of Conversion. It is an obligation of the Borrower to remain current in its 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 paid by the Borrower to the Holder within forty eight (48) hours of
a demand from the Holder.


 


3.3 Breach of Covenants. The Borrower
breaches any material covenant or other material term or condition contained in this Note and any collateral documents including
but not limited to the Purchase Agreement.


 


3.4 Breach of Representations and Warranties.
Any representation or warranty of the Borrower made herein or in any agreement, statement or certificate given in writing pursuant
hereto or in connection herewith (including, without limitation, the Purchase Agreement), 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 commence proceedings for its dissolution,
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 for the Borrower or for a substantial part of its property or business
without its consent and shall not be discharged within sixty (60) days after such appointment.


 


3.6 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, or the Borrower
admits in writing its inability to pay its debts generally as they mature, or have filed against it an involuntary petition for
bankruptcy relief, all under federal or state laws as applicable or the Borrower admits in writing its inability to pay its debts
generally as they mature, or have filed against it an involuntary petition for bankruptcy relief, all under international, federal
or state laws as applicable.


 




    	 	16	 



     


    

 


3.7 Liquidation. Any dissolution,
liquidation, or winding up of Borrower or any substantial portion of its business.


 


3.8 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.


 


3.9 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).


 


3.10 Cross-Default. Notwithstanding
anything to the contrary contained in this Note or the other related or companion documents, a breach or default by the Borrower
of any covenant or other term or condition contained in any of the Other Agreements (as defined herein), after the passage of all
applicable notice and cure or grace periods, shall, at the option of the Holder, be considered a default under this Note and the
Other Agreements, in which event the Holder shall be entitled (but in no event required) to apply all rights and remedies of the
Holder under the terms of this Note and the Other Agreements by reason of a default under said Other Agreement or hereunder. “Other
Agreements” means, collectively, all agreements and instruments between, among or by: (1) the Borrower, and (2) the Holder
or any other third party, including, without limitation, promissory notes; provided, however, the term “Other Agreements”
shall not include this Note. Each of the loan transactions will be cross-defaulted with each other loan transaction and with all
other existing and future debt of Borrower to the Holder.


 


3.11 [Intentionally Omitted].


 


3.12 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 $56,000.00, and shall remain unvacated, unbonded or unstayed for a period of sixty (60) days unless
otherwise consented to by the Holder, which consent will not be unreasonably withheld.


 


3.13 Replacement of Transfer Agent.
In the event that the Borrower proposes to replace its transfer agent and (i) the Borrower fails to obtain written approval from
the Holder prior to the effective date of such replacement, or (ii) 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.


 




    	 	17	 



     


    

 


3.14 Bid Price. If the Borrower
loses the “bid” price for its Common Stock ($0.0001 on the “Ask” with zero market makers on the “Bid”
per Level 2) and/or a market (including the OTCBB, OTCQB or an equivalent replacement exchange) for its Common Stock.


 


3.15 [Intentionally Omitted]. 


 


3.16 Market Capitalization. The
Borrower fails to maintain a market capitalization of at least $1,000,000 on any Trading Day, which shall be calculated by multiplying
(i) the closing bid price of the Borrower’s common stock on the Trading Day immediately preceding the respective date of
calculation by (ii) the total shares of the Borrower’s common stock issued and outstanding on the Trading Day immediately
preceding the respective date of calculation.


 


3.17 Maximum Conversion. If at any
time while this Note is outstanding, and assuming the beneficial ownership limitations contained in this Note did not apply to
this specific calculation, the Holder could convert the amounts outstanding under Note into more than 4.99% of the outstanding
shares of Common Stock of the Company as of the date of calculation.


 


3.18 [Intentionally Omitted].


 


3.19 OTC Marketplace Segments. If
(i) the Common Stock of the Borrower or the Borrower itself has any notation on the OTC Markets Group website (www.otcmarkets.com)
other than “Current Information,” including but not limited to “Limited Information” (Yield Sign) or “No
Information” (Stop Sign), or if the Common Stock of the Borrower is shown only as quoted on the “grey markets,”
and (ii) by reason thereof, the Holder is unable to obtain a standard “144 legal opinion” from an attorney reasonably
acceptable to The Holder, its brokerage firm, and the Company’s transfer agent in order to facilitate the Holder’s
conversion of any of the Borrower’s obligations hereunder into shares of the Borrower’s Common Stock and thereupon
deposit such shares into the Holder’s brokerage account.


 


3.20 Dilutive Issuance. If at any
time while this Note is outstanding, the Company issues any of its common stock at a price per share price lower than the Conversion
Price then in effect.


 


3.21 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.


 


3.22 DDQ. If any of the information
in the due diligence questionnaire, provided by the Borrower to the Holder on or around the Issue Date, is false or misleading
in any material respect.


 




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3.23 Prior Notes. If, at any time
on or after the Issue Date, the Borrower alters the conversion terms of any promissory note that was issued on or before the day
immediately prior to the Issue Date.


 


3.24 Failure to Comply with the Exchange
Act. The Borrower shall fail to comply with the reporting requirements of the Exchange Act (including but not limited to becoming
delinquent in its filings); and/or the Borrower shall cease to be subject to the reporting requirements of the Exchange Act.


 


Upon the occurrence of any Event of Default
specified in Sections 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 3.16, 3.17, 3.18, 3.19,
3.20, 3.21, 3.22, 3.23 and/or 3.24, the 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 (i) 150% (EXCEPT WITH RESPECT OT SECTION 3.2, IN WHICH CASE
150% SHALL BE REPLACED WITH 200%) times  the sum of (w) the then outstanding principal amount of this Note plus
(x) accrued and unpaid interest on the unpaid principal amount of this Note to the date of payment (the “Mandatory Prepayment
Date”) plus (y) Default Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any
amounts owed to the Holder pursuant to Sections 1.3 and 1.4(g) hereof (the then outstanding principal amount of this Note to the
date of payment plus the amounts referred to in clauses (x), (y) and (z) shall collectively be known as the “Default
Sum”) or (ii) at the option of the Holder, the “parity value” of the Default Sum to be prepaid, where parity
value means (a) the highest number of shares of Common Stock issuable upon conversion of or otherwise pursuant to such Default
Sum in accordance with Article I, treating the Trading Day immediately preceding the Mandatory Prepayment Date as the “Conversion
Date” for purposes of determining the lowest applicable Conversion Price, unless the Default Event arises as a result of
a breach in respect of a specific Conversion Date in which case such Conversion Date shall be the Conversion Date), multiplied
by (b) the highest Trading Price for the Common Stock during the period beginning on the date of first occurrence of the Event
of Default and ending one day prior to the Mandatory Prepayment Date (the “Default Amount”) and all other amounts payable
hereunder shall immediately become due and payable, all without demand, presentment or notice, all of which hereby are expressly
waived, together with all costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be
entitled to exercise all other rights and remedies available at law or in equity.


 


This requirement by the Borrower shall
automatically apply upon the occurrence of an Event of Default without the need for any party to give any notice or take any other
action. Additionally, if this Note is not paid at the Maturity Date, then the outstanding principal due under this Note shall increase
by Fifteen Thousand and No/100 United States Dollars ($15,000).


 




    	 	19	 



     


    

 


The Holder shall have the right at any
time to convert the Default Amount, in whole or in part, pursuant to the terms of this Note and at the Conversion Price in effect
at the time of conversion.


 


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 Borrower for its attorneys' fees and other costs and expenses incurred in
the investigation, preparation and prosecution of such action or proceeding.


 


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 existing hereunder are cumulative to, and not exclusive of,
any rights or remedies otherwise available.


 


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,
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 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:


 


Nightfood Holdings, Inc.


520 White Plains Road, Suite 500


Tarrytown, NY 10591


E-mail: nightfood@nightfood.com


 




    	 	20	 



     


    

 


With a copy to (which copy shall not constitute notice):


 


Frank J. Hariton, Esq.


1065 Dobbs Ferry Road


White Plains, NY 10607


E-mail: hariton@sprynet.com


 


If to the Holder:


 


Labrys Fund, LP


48 Parker Road


Wellesley, MA 02482


E-mail: admin@equiluxgroup.com


 


With a copy to (which copy shall not constitute notice):


 


Legal & Compliance, LLC


330 Clematis Street, Ste. 217


West Palm Beach, FL 33401


Attn: Chad Friend, Esq., LL.M.


E-mail: CFriend@LegalAndCompliance.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 (and the other Notes issued pursuant
to the Purchase Agreement) as originally executed, or if later amended or supplemented, then as so amended or supplemented.


 


4.4 Assignability. The Holder may
assign or transfer this Note to any transferee at its sole discretion. 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. Each transferee of this Note must
be an “accredited investor” (as defined in Rule 501(a) of the 1933 Act). 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 reasonable costs of collection, including reasonable
attorneys’ fees.


 




    	 	21	 



     


    

 


4.6 Governing Law. This Note shall
be governed by and construed in accordance with the laws of the State of Nevada without regard to principles of conflicts of laws.
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,
Massachusetts, 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 the Commonwealth of Massachusetts, except that all such disputes between the parties shall be
subject to alternative dispute resolution through binding arbitration at the Holder’s sole discretion and election (regardless
of which party initiates the legal proceedings). The parties to this Note hereby irrevocably waive 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 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 agree to submit to the jurisdiction of such courts or to such arbitration panel, as the case may be.


 


If the Holder elects alternative dispute
resolution by arbitration, the arbitration proceedings shall be conducted in the Commonwealth of Massachusetts and administered
by the American Arbitration Association in accordance with its Commercial Arbitration Rules and Mediation Procedures in effect
on the Issue Date, except as modified by this Note. The Holder’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 Holder 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.


 




    	 	22	 



     


    

 


THE BORROWER HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE TO, 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 TRANSACTION CONTEMPLATED HEREBY.


 


The prevailing party shall be entitled
to recover from the other party its reasonable attorney's fees and costs. In the event that any provision of this Note or any other
agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, 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 any agreement. 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 related transaction document 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.


 


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. By its acceptance
of this Note, each party agrees to be bound by the applicable terms of the Purchase Agreement.


 


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 proposed sale,
lease or conveyance of all or substantially all of the assets of the Borrower 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 including, but not limited to, name changes, recapitalizations,
etc. as soon as possible under law.


 




    	 	23	 



     


    

 


4.10 Usury. If Notwithstanding any
provision in this Note or the related transaction documents to the contrary, the total liability for payments of interest and payments
in the nature of interest, including, without limitation, all charges, fees, exactions, or other sums which may at any time be
deemed to be interest, shall not exceed the limit imposed by the usury laws of the jurisdiction governing this Note or any other
applicable law. In the event the total liability of payments of interest and payments in the nature of interest, including, without
limitation, all charges, fees, exactions or other sums which may at any time be deemed to be interest, shall, for any reason whatsoever,
result in an effective rate of interest, which for any month or other interest payment period exceeds the limit imposed by the
usury laws of the jurisdiction governing this Note, all sums in excess of those lawfully collectible as interest for the period
in question shall, without further agreement or notice by, between, or to any party hereto, be applied to the reduction of the
outstanding principal balance due hereunder immediately upon receipt of such sums by the Holder hereof, with the same force and
effect as though the Company had specifically designated such excess sums to be so applied to the reduction of the principal balance
then outstanding, and the Holder hereof had agreed to accept such sums as a penalty-free payment of principal; provided, however,
that the Holder may, at any time and from time to time, elect, by notice in writing to the Company, to waive, reduce, or limit
the collection of any sums in excess of those lawfully collectible as interest, rather than accept such sums as a prepayment of
the principal balance then outstanding. It is the intention of the parties that the Company does not intend or expect to pay, nor
does the Holder intend or expect to charge or collect any interest under this Note greater than the highest non-usurious rate of
interest which may be charged under applicable law.


 


4.11 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. No provision of this Note shall alter or impair the obligation of the Borrower, 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.


 


4.12 Severability. In the event
that any provision of this Note is invalid or unenforceable under any applicable statute or rule of law, then such provision shall
be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform to such statute or rule
of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability
of any other provision hereof.


 


4.13 Dispute Resolution. In the
case of a dispute as to the determination of the Conversion Price, Conversion Amount, any prepayment amount or Default Amount,
Default Sum, 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 two (2) Business Days 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 two (2) Business Days 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 two (2) Business Days, submit
via facsimile (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, Default Sum 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 ten (10) Business Days 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.


 




    	 	24	 



     


    

 


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 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 Holder in this Note, then the Borrower shall notify the Holder of such additional or more favorable term and such term,
at Holder’s option, shall become a part of the transaction documents with the Holder. 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
discounts, prepayment rate, conversion lookback periods, interest rates, original issue discounts, stock sale price, private placement
price per share, and warrant coverage. If the Holder notifies the Company that its most favored nation provision has been triggered
prior to the 180th calendar day after the Issue Date, then the Company shall have seven (7) business days to cure such triggering
event by repaying the Note in full pursuant to the terms of the Note.


 


4.15 [Intentionally Omitted].


 


4.16 Disclosure. Upon receipt or
delivery by the Company of any notice in accordance with the terms of this Note, unless the Company has in good faith determined
that the matters relating to such notice do not constitute material, non-public information relating to the Company or any of its
Subsidiaries, the Company shall within one (1) Trading Day after any such receipt or delivery, publicly disclose such material,
non-public information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains
material, non-public information relating to the Company or any of its Subsidiaries, the Company so shall indicate to such Holder
contemporaneously with delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume
that all matters relating to such notice do not constitute material, non-public information relating to the Company or its Subsidiaries.


 


[signature page to follow]


 




    	 	25	 



     


    

 


IN
WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer as of the date first above
written.


 


	 	NIGHTFOOD HOLDINGS, INC.
	 	 	 
	 	By: 	/s/ Sean Folkson
	 	Name: 	Sean Folkson
	 	Title: 	Chief Executive Officer


 




    	 	26	 



     


    

 


EXHIBIT A


NOTICE OF CONVERSION


 


The undersigned hereby
elects to convert $____________________ principal amount of the Note (defined below) together with $_________________ of accrued
and unpaid interest thereto, totaling $_______________ 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 Nightfood Holdings, Inc., a Nevada corporation (the
“Borrower”), according to the conditions of the convertible note of the Borrower dated as of December 6, 2017 (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
At Custodian 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:



 


Name: Labrys Fund, LP


 


Address: ___________________________


 


	 	Date of Conversion:	 	 
	 	 	 	 
	 	Applicable Conversion
Price:	$	 
	 	 	 	 
	 	Number of Shares of Common Stock to be Issued Pursuant to Conversion of the Notes:	 	 
	 	 	 	 
	 	Amount of Principal
Balance Due remaining Under the Note after this conversion:	 	 
	 	 	 	 
	 	Accrued and unpaid interest remaining:	$	 
	 	 	 	 
	 	Default Amounts & Penalties remaining (if applicable):	$	 


 


	LABRYS FUND, LP	 
	 	 	 
	By: 	 	 
	Name: 	 	 
	Title: 	Principal	 
	Date: