Exhibit
10.1


 


SECOND
AMENDMENT TO THE


UNSECURED
PROMISSORY NOTE


 


THIS
SECOND AMENDMENT TO THE UNSECURED PROMISSORY NOTE (this “Second Amendment”), effective as of December 3, 2019, is
by and between Flux Power, Inc., a California corporation (“Borrower”) and Cleveland Capital, L.P. (“Holder”).
Holder and Borrower, each a “Party” and collectively, the “Parties”.


 


RECITALS


 


WHEREAS,
the Borrower, Flux Power Holdings, Inc., and the Holder entered into that certain Loan Agreement dated July 3, 2019 (the “Loan
Agreement”), pursuant to which the Holder provided a loan to the Company in the amount of One Million Dollar ($1,000,000)
(“Loan”) pursuant to the terms and conditions of the Loan Agreement. In connection with the Loan, the Borrower issued
a certain Unsecured Promissory Note dated July 3, 2019 (“Original Note”), as amended pursuant to the First Amendment
to the Unsecured Promissory Note dated September 1, 2019 (“First Amendment,” together with the Original Note, the
“Amended Note”).


 


WHEREAS,
the maturity date for the Loan under the Amended Note is December 1, 2019.


 


WHEREAS,
the Parties desires to amend the Amended Note to change the maturity date from “December 1, 2019” to “December
31, 2019.”


 


AGREEMENT


 


NOW,
THEREFORE, in consideration of the foregoing premises, the mutual agreements set forth below, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:


 


1.
Maturity Date. Section 1(b) of the Amended Note is hereby deleted in its entirety and shall, be amended to read in its
entirety as follows:


 


“(b)
“Maturity Date. Except as otherwise provided herein, the entire Principal Amount of this Note, together with all
accrued but unpaid interest payable thereon, shall be due and payable in full on the earlier of: (i) December 31, 2019 (the “Maturity
Date”) or (ii) the occurrence of an Event of Default (as defined below); provided, however, the Borrower
shall make periodic payments of interest and principal within ten (10) days upon receipt of cash from accounts receivables identified
in Schedule A (“Receivables”), an amount equal to 100% of cash received from such Receivables. Such
payments shall be applied first to the payment of unpaid interest and second to reduce the outstanding Principal amount.”


 


2.
Waiver. Effective upon the execution of this Second Amendment, the Holder hereby (a) waives any Event of Default (as defined
in the Original Note) arising from the failure by the Borrower to satisfy the payment requirement under the Note on or before
December 1, 2019 and (b) acknowledge and agree that no Event of Default has resulted or shall be deemed to have resulted from
such failure. Except as otherwise expressly provided in this Section 2, the execution, delivery and effectiveness of this Second
Amendment or the effectiveness of the foregoing waiver shall not operate as a waiver of any other Event of Default that may now
or hereafter exist or of any right, power or remedy of the Holder under the Note.


 




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3.
Surviving Terms, Inconsistencies. Except for those terms and conditions modified in this Second Amendment, all terms and
conditions of the Note shall continue unchanged and in full force and effect, and shall govern the Parties’ rights and obligations
thereunder. In the event of any conflict between the terms and conditions of the Amended Note and those of this Second Amendment,
the terms and conditions of this Second Amendment shall govern.


 


4.
Counterparts. This Second Amendment may be executed in two counterparts, each of which shall constitute an original and
which, together, shall constitute one and the same instrument. The parties may execute facsimile copies of this Second Amendment
and delivery by facsimile shall be deemed to be delivery of an executed Second Amendment.


 


IN
WITNESS WHEREOF, the Parties have caused this Second Amendment to be executed by its authorized representative as of the date
set forth above.


 


	 	BORROWER:
	 	 
	 	Flux
    Power, Inc.,
	 	a
    California corporation 
	 	 	 
	 	 	/s/ Ronald F. Dutt 
	 	 	Ronald
    F. Dutt, President and Chief Executive Officer
	 	 	 
	 	HOLDER:
    
	 	 
	 	Cleveland
    Capital, L.P.
	 	 	 
	 	By:
    	/s/
    Wade Massad
	 	 	Wade
    Massad, Co-Managing Member, GP


 




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