Exhibit 10.2


 


EXECUTION VERSION


 


 


NEITHER THIS DEBENTURE NOR THE SECURITIES
INTO WHICH THIS DEBENTURE IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE. THESE SECURITIES HAVE BEEN SOLD IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.


 


SAMSARA
LUGGAGE, INC.


 


Convertible
Debenture


 


	Issuance Date:  December 14, 2021	 	Original Principal Amount:  $500,000
	 	 	 
	No. SAML-4 1-1	 	 



 


FOR VALUE RECEIVED, SAMSARA
LUGGAGE, INC., a Nevada corporation (the “Company”), hereby promises to pay to the order of YA II PN, LTD.,
or registered assigns (the “Holder”) the amount set out above as the Original Principal Amount (as reduced pursuant to
the terms hereof pursuant to redemption, conversion or otherwise, the “Principal”) when due, on the Maturity Date (as
defined below), acceleration, redemption or otherwise (in each case in accordance with the terms hereof) and to pay interest (“Interest”)
on any outstanding Principal at the applicable Interest Rate from the date set out above as the Issuance Date (the “Issuance Date”)
until the same becomes due and payable, whether upon the Maturity Date, acceleration, conversion, redemption or otherwise (in each case
in accordance with the terms hereof). This Convertible Debenture (including all Convertible Debentures issued in exchange, transfer or
replacement hereof, this “Debenture”) is issued pursuant to the Securities Purchase Agreement. Certain capitalized terms
used herein are defined in Section 17.


 


(1) GENERAL
TERMS


 


(a) Payment
of Principal. On the Maturity Date, the Company shall pay to the Holder an amount in cash representing all outstanding Principal,
accrued and unpaid Interest. The “Maturity Date” shall be December 14, 2022, as may be extended at the option of the
Holder (i) in the event that, and for so long as, an Event of Default (as defined below) shall have occurred and be continuing on the
Maturity Date (as may be extended pursuant to this Section 1) or any event shall have occurred and be continuing on the Maturity Date
(as may be extended pursuant to this Section 1) that with the passage of time and the failure to cure would result in an Event of Default.
Other than as specifically permitted by this Debenture, the Company may not prepay or redeem any portion of the outstanding Principal
without the prior written consent of the Holder.


 






     


     


    

 





(b) Interest.
Interest shall accrue on the outstanding principal balance hereof at an annual rate equal to 10% (“Interest Rate”).
Interest shall be calculated on the basis of a 365-day year and the actual number of days elapsed, to the extent permitted by applicable
law. Interest hereunder shall be paid on the Maturity Date (or sooner if upon conversion or acceleration by the Holder as provided herein)
to the Holder or its assignee in whose name this Debenture is registered on the records of the Company regarding registration and transfers
of Debentures at the option of the Company in cash, or, provided that there is no Equity Conditions Failure, converted into Common Stock
at the Market Conversion Price on the Trading Day immediately prior to the date paid.


 


(2) EVENTS
OF DEFAULT. 


 


(a) An
“Event of Default”, wherever used herein, means any one of the following events (whatever the reason and whether it
shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order,
rule or regulation of any administrative or governmental body):


 


(i) the
Company’s failure to pay to the Holder any amount of Principal, Interest, or other amounts when and as due under this Debenture (including,
without limitation, the Company’s failure to pay any redemption payments or amounts hereunder) or any other Transaction Document, which
failure is not cured within thirty (30) days of the date the Company is notified by the Holder of the occurrence of such failure;


 


(ii) The
Company or any subsidiary of the Company shall commence, or there shall be commenced against the Company or any subsidiary of the Company
under any applicable bankruptcy or insolvency laws as now or hereafter in effect or any successor thereto, or the Company or any subsidiary
of the Company commences any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to the Company or any subsidiary
of the Company or there is commenced against the Company or any subsidiary of the Company any such bankruptcy, insolvency or other proceeding
which remains undismissed for a period of 61 days; or the Company or any subsidiary of the Company is adjudicated insolvent or bankrupt;
or any order of relief or other order approving any such case or proceeding is entered; or the Company or any subsidiary of the Company
suffers any appointment of any custodian, private or court appointed receiver or the like for it or any substantial part of its property
which continues undischarged or unstayed for a period of 61 days; or the Company or any subsidiary of the Company makes a general assignment
for the benefit of creditors; or the Company or any subsidiary of the Company shall fail to pay, or shall state that it is unable to pay,
or shall be unable to pay, its debts generally as they become due; or the Company or any subsidiary of the Company shall call a meeting
of its creditors with a view to arranging a composition, adjustment or restructuring of its debts; or the Company or any subsidiary of
the Company shall by any act or failure to act expressly indicate its consent to, approval of or acquiescence in any of the foregoing;
or any corporate or other action is taken by the Company or any subsidiary of the Company for the purpose of effecting any of the foregoing;


 






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(iii) The
Company or any subsidiary of the Company shall default in any of its obligations under any other debenture or any mortgage, credit agreement
or other facility, indenture agreement, factoring agreement or other instrument under which there may be issued, or by which there may
be secured or evidenced any indebtedness for borrowed money or money due under any long term leasing or factoring arrangement of the Company
or any subsidiary of the Company in an amount exceeding $250,000, whether such indebtedness now exists or shall hereafter be created and
such default shall result in such indebtedness becoming or being declared due and payable prior to the date on which it would otherwise
become due and payable;


 


(iv) If
the Common Stock is quoted or listed for trading on the following and it ceases to be so quoted or listed for trading and shall not again
be quoted or listed for trading on the OTC Markets’ OTCQB® Market (the “Primary Market”) within
5 Trading Days of such delisting;


 


(v) The
Company or any subsidiary of the Company shall be a party to any Change of Control Transaction (as defined in Section 17) unless in connection
with such Change of Control Transaction this Debenture is retired;


 


(vi) The
Company shall fail to file a registration statement with the Commission as required by Section 5(q) of the Securities Purchase Agreement,
or while such registration statement is effective, the effectiveness of such registration statement lapses for any reason (including,
without limitation, the issuance of a stop order) or is unavailable to the Holder for sale of all of the Holder’s Registrable Securities
(as defined in the Securities Purchase Agreement) in accordance with the terms thereof, and such lapse or unavailability continues for
a period of more than 15 consecutive Trading Days or for more than an aggregate of 30 days in any 365-day period (which need not be consecutive);


 


(vii) the
Company’s (A) failure to cure a Conversion Failure by delivery of the required number of shares of Common Stock within 5 Business Days
after the applicable Conversion Failure or (B) notice, written or oral, to any holder of the Debenture, including by way of public announcement,
at any time, of its intention not to comply with a request for conversion of the Debenture into shares of Common Stock that is tendered
in accordance with the provisions of the Debentures, other than pursuant to Section 4(e);


 


(viii) The
Company shall fail for any reason to deliver the payment in cash pursuant to a Buy-In (as defined herein) within 5 Business Days after
such payment is due;


 






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(ix) The
Company shall fail to observe or perform any other covenant, agreement or warranty contained in, or otherwise commit any breach or default
of any provision of this Debenture (except as may be covered by Section 2(a)(i) through 2(a)(viii) hereof) or any Transaction Documents
(as defined in Section 17) which is not cured within the time prescribed.


 


(x) any
Event of Default occurs with respect to any Transaction Document.


 


(b) During
the time that any portion of this Debenture is outstanding, if any Event of Default has occurred, the full unpaid Principal amount of
this Debenture, together with interest and other amounts owing in respect thereof, to the date of acceleration shall become at the Holder’s
election, immediately due and payable in cash; provided however, the Holder may request (but shall have no obligation to request) payment
of such amounts in Common Stock of the Company. If an Event of Default occurs and for so long as such Event of Default remains uncured,
the Interest Rate on this Debenture shall immediately become 15% per annum and shall remain at such increased interest rate until the
applicable Event of Default is cured. Furthermore, in addition to any other remedies, the Holder shall have the right (but not the obligation)
to convert this Debenture at any time after (x) an Event of Default at the Market Conversion Price or (y) the Maturity Date at the Market
Conversion Price. The Holder need not provide and the Company hereby waives any presentment, demand, protest or other notice of any kind,
(other than required notice of conversion) and the Holder may immediately and without expiration of any grace period enforce any and all
of its rights and remedies hereunder and all other remedies available to it under applicable law. Such declaration may be rescinded and
annulled by Holder at any time prior to payment hereunder. No such rescission or annulment shall affect any subsequent Event of Default
or impair any right consequent thereon.


 


(3) COMPANY
REDEMPTION.


 


(a) Company’s
Cash Redemption. The Company at its option shall have the right to redeem (a “Redemption”), in part or in whole,
outstanding Principal and Interest under this Debenture prior to the Maturity Date provided that as of the date of the Holder’s
receipt of a Redemption Notice (as defined herein) (i) the VWAP of the Company’s Common Stock is less than the Fixed Conversion
Price and (ii) there is no Equity Conditions Failure. The Company shall pay an amount equal to the principal amount being redeemed plus
a redemption premium equal to 5% of the outstanding Principal Amount being redeemed plus outstanding and accrued Interest (“Redemption
Premium”). In order to make a Redemption pursuant to this Section, the Company shall first provide 15 business days advanced
written notice to the Holder of its intention to make a redemption (the “Redemption Notice”) setting forth the amount
of Principal and Interest it desires to redeem plus the applicable Redemption Premium (the “Redemption Amount”). After
receipt of the Redemption Notice the Holder shall have 15 Business Days to elect to convert all or any portion of this Debenture, subject
to the limitations set forth in Section 4(f). On the 16th Business Day after the Redemption Notice, the Company shall deliver
to the Holder via wire transfer of immediately available funds the Redemption Amount with respect to the Principal Amount and Interest
redeemed after giving effect to conversions by the Holder effected during the 15th Business Day period.


 






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(4) CONVERSION OF DEBENTURE. This
Debenture shall be convertible into shares of the Company’s Common Stock, on the terms and conditions set forth in this Section 4.


 


(a) Conversion
Right. Subject to the provisions of Section 2(b), Section 4(a), and Section 4(f), at any time or times on or after the Issuance Date
and not withstanding any pending Company Redemption, the Holder shall be entitled to convert at its option the outstanding and unpaid
Conversion Amount (as defined below), into fully paid and nonassessable shares of Common Stock in accordance with Section 4(e) below,
at the lower of the Fixed Conversion Price then in effect or the Market Conversion Price except as provided for in Section 2(b). The number
of shares of Common Stock issuable upon conversion of any Conversion Amount pursuant to this Section 4(a) shall be determined by dividing
(x) such Conversion Amount by (y) the Fixed Conversion Price or (z) the Market Conversion Price, as applicable (the “Conversion
Rate”). The Company shall not issue any fraction of a share of Common Stock upon any conversion. If the issuance would result
in the issuance of a fraction of a share of Common Stock, the Company shall round such fraction of a share of Common Stock up to the nearest
whole share. The Company shall pay any and all transfer, stamp and similar taxes that may be payable with respect to the issuance and
delivery of Common Stock upon conversion of any Conversion Amount.


 


(b)
“Conversion Amount” means the portion of the Principal and accrued Interest to be converted, redeemed or otherwise
with respect to which this determination is being made.


 


(c) “Fixed
Conversion Price” means, as of any Conversion Date (as defined below) or other date of determination, $1.30, subject to
adjustment as provided herein. All such determinations to be appropriately adjusted for any stock split, stock dividend, stock combination
or other similar transaction.


 


(d) “Market
Conversion Price” means, as of any Conversion Date (as defined below) or other date of determination, 80% of the lowest VWAP
of the Company’s Common Stock during the 10 Trading Days immediately preceding the Conversion Date. All such determinations to be
appropriately adjusted for any stock split, stock dividend, stock combination or other similar transaction.


 


(e) Mechanics
of Conversion.


 


(i) Optional
Conversion. To convert any Conversion Amount into shares of Common Stock on any date (a “Conversion Date”), the Holder
shall (A) transmit by electronic mail (or otherwise deliver), for receipt on or prior to 11:59 p.m., New York Time, on such date, a copy
of an executed notice of conversion in the form attached hereto as Exhibit I (the “Conversion Notice”) to the
Company and (B) if required by Section 4(e)(iii), surrender this Debenture to a nationally recognized overnight delivery service for delivery
to the Company (or an indemnification undertaking reasonably satisfactory to the Company with respect to this Debenture in the case of
its loss, theft or destruction). On or before the 5th Business Day following the date of receipt of a Conversion Notice (the
“Share Delivery Date”), the Company shall (X) if legends are not required to be placed on certificates of Common Stock
pursuant to the Securities Purchase Agreement and provided that the Transfer Agent is participating in the Depository Trust Company’s
(“DTC”) Fast Automated Securities Transfer Program, credit such aggregate number of shares of Common Stock to which the
Holder shall be entitled to the Holder’s or its designee’s balance account with DTC through its Deposit Withdrawal Agent Commission system
or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities Transfer Program, issue and deliver to the address
as specified in the Conversion Notice, a certificate, registered in the name of the Holder or its designee, for the number of shares of
Common Stock to which the Holder shall be entitled which certificates shall not bear any restrictive legends unless required pursuant
to Section 3(g) of the Securities Purchase Agreement. If this Debenture is physically surrendered for conversion and the outstanding Principal
of this Debenture is greater than the Principal portion of the Conversion Amount being converted, then the Company shall as soon as practicable
and in no event later than 5 Business Days after receipt of this Debenture and at its own expense, issue and deliver to the holder a new
Debenture representing the outstanding Principal not converted. The Person or Persons entitled to receive the shares of Common Stock issuable
upon a conversion of this Debenture shall be treated for all purposes as the record holder or holders of such shares of Common Stock upon
the transmission of a Conversion Notice.


 






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(ii) Company’s
Failure to Timely Convert. If within 5 Trading Days after the Company’s receipt by electronic mail a copy of a Conversion Notice the
Company shall fail to issue and deliver a certificate to the Holder or credit the Holder’s balance account with DTC for the number of
shares of Common Stock to which the Holder is entitled upon such conversion of any Conversion Amount (a “Conversion Failure”),
and if on or after such Trading Day the Holder purchases (in an open market transaction or otherwise) Common Stock to deliver in satisfaction
of a sale by the Holder of Common Stock issuable upon such conversion that the Holder anticipated receiving from the Company (a “Buy-In”),
then the Company shall, within 5 Business Days after the Holder’s request and in the Holder’s discretion, either (i) pay cash to the Holder
in an amount equal to the Holder’s total purchase price (including brokerage commissions and other out of pocket expenses, if any) for
the shares of Common Stock so purchased (the “Buy-In Price”), at which point the Company’s obligation to
deliver such certificate (and to issue such Common Stock) shall terminate, or (ii) promptly honor its obligation to deliver to the Holder
a certificate or certificates representing such Common Stock and pay cash to the Holder in an amount equal to the excess (if any) of the
Buy-In Price over the product of (A) such number of shares of Common Stock, times (B) the Closing Bid Price on the Conversion Date.


 


(iii) Book-Entry.
Notwithstanding anything to the contrary set forth herein, upon conversion of any portion of this Debenture in accordance with the terms
hereof, the Holder shall not be required to physically surrender this Debenture to the Company unless (A) the full Conversion Amount represented
by this Debenture is being converted or (B) the Holder has provided the Company with prior written notice (which notice may be included
in a Conversion Notice) requesting reissuance of this Debenture upon physical surrender of this Debenture. The Holder and the Company
shall maintain records showing the Principal and Interest converted and the dates of such conversions or shall use such other method,
reasonably satisfactory to the Holder and the Company, so as not to require physical surrender of this Debenture upon conversion.


 


(f) Limitations
on Conversions.


 


(i) Beneficial
Ownership. The Company shall not effect any conversions of this Debenture and the Holder shall not have the right to convert any portion
of this Debenture or receive shares of Common Stock as payment of interest hereunder to the extent that after giving effect to such conversion
or receipt of such interest payment, the Holder, together with any affiliate thereof, would beneficially own (as determined in accordance
with Section 13(d) of the Exchange Act and the rules promulgated thereunder) in excess of 9.99% of the number of shares of Common Stock
outstanding immediately after giving effect to such conversion or receipt of shares as payment of interest. Since the Holder will not
be obligated to report to the Company the number of shares of Common Stock it may hold at the time of a conversion hereunder, unless the
conversion at issue would result in the issuance of shares of Common Stock in excess of 4.99% of the then outstanding shares of Common
Stock without regard to any other shares which may be beneficially owned by the Holder or an affiliate thereof, the Holder shall have
the authority and obligation to determine whether the restriction contained in this Section will limit any particular conversion hereunder
and to the extent that the Holder determines that the limitation contained in this Section applies, the determination of which portion
of the principal amount of this Debenture is convertible shall be the responsibility and obligation of the Holder. If the Holder has delivered
a Conversion Notice for a principal amount of this Debenture that, without regard to any other shares that the Holder or its affiliates
may beneficially own, would result in the issuance in excess of the permitted amount hereunder, the Company shall notify the Holder of
this fact and shall honor the conversion for the maximum principal amount permitted to be converted on such Conversion Date in accordance
with Section 4(a) and, any principal amount tendered for conversion in excess of the permitted amount hereunder shall remain outstanding
under this Debenture. The provisions of this Section may be waived by a Holder (but only as to itself and not to any other Holder) upon
not less than 65 days prior notice to the Company. Other Holders shall be unaffected by any such waiver.


 






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(g) Other
Provisions.


 


(i) The
Company shall at all times reserve and keep available out of its authorized Common Stock the full number of shares of Common Stock issuable
upon conversion of all outstanding amounts under this Debenture; and within 5 Business Days following the receipt by the Company of a
Holder’s notice that such minimum number of Underlying Shares is not so reserved, the Company shall promptly reserve a sufficient number
of shares of Common Stock to comply with such requirement.


 


(ii) All
calculations under this Section 4 shall be rounded to the nearest $0.0001 or whole share.


 


(iii) The
Company covenants that it will at all times reserve and keep available out of its authorized and unissued shares of Common Stock solely
for the purpose of issuance upon conversion of this Debenture and payment of interest on this Debenture, each as herein provided, free
from preemptive rights or any other actual contingent purchase rights of persons other than the Holder, not less than such number of shares
of the Common Stock as shall (subject to any additional requirements of the Company as to reservation of such shares set forth in this
Debenture or in the Transaction Documents) be issuable (taking into account the adjustments and restrictions set forth herein) upon the
conversion of the outstanding principal amount of this Debenture and payment of interest hereunder. The Company covenants that all shares
of Common Stock that shall be so issuable shall, upon issue, be duly and validly authorized, issued and fully paid, nonassessable and,
if the Underlying Shares Registration Statement has been declared effective under the Securities Act, registered for public sale in accordance
with such Underlying Shares Registration Statement.


 


(iv) Nothing
herein shall limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to Section 2 herein for the Company’s
failure to deliver certificates representing shares of Common Stock upon conversion within the period specified herein and such Holder
shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance
and/or injunctive relief, in each case without the need to post a bond or provide other security. The exercise of any such rights shall
not prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under applicable law.


 






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(5) Merger
or Consolidation.


 


(a) In
case of any (1) merger or consolidation of the Company or any subsidiary of the Company with or into another Person, or (2) sale by the
Company or any subsidiary of the Company of more than one-half of the assets of the Company in one or a series of related transactions,
a Holder shall have the right to (A) exercise any rights under Section 2(b), (B) convert the aggregate amount of this Debenture then outstanding
into the shares of stock and other securities, cash and property receivable upon or deemed to be held by holders of Common Stock following
such merger, consolidation or sale, and such Holder shall be entitled upon such event or series of related events to receive such amount
of securities, cash and property as the shares of Common Stock into which such aggregate principal amount of this Debenture could have
been converted immediately prior to such merger, consolidation or sales would have been entitled, or (C) in the case of a merger or consolidation,
require the surviving entity to issue to the Holder a convertible Debenture with a principal amount equal to the aggregate principal amount
of this Debenture then held by such Holder, plus all accrued and unpaid interest and other amounts owing thereon, which such newly issued
convertible Debenture shall have terms identical (including with respect to conversion) to the terms of this Debenture, and shall be entitled
to all of the rights and privileges of the Holder of this Debenture set forth herein and the agreements pursuant to which this Debentures
were issued. In the case of clause (C), the conversion price applicable for the newly issued shares of convertible preferred stock or
convertible Debentures shall be based upon the amount of securities, cash and property that each share of Common Stock would receive in
such transaction and the Fixed Conversion Price in effect immediately prior to the effectiveness or closing date for such transaction.
The terms of any such merger, sale or consolidation shall include such terms so as to continue to give the Holder the right to receive
the securities, cash and property set forth in this Section upon any conversion or redemption following such event. This provision shall
similarly apply to successive such events.


 


(6) REISSUANCE
OF THIS DEBENTURE.


 


(a) Transfer.
If this Debenture is to be transferred, the Holder shall surrender this Debenture to the Company, whereupon the Company will, subject
to the satisfaction of the transfer provisions of the Securities Purchase Agreement, forthwith issue and deliver upon the order of the
Holder a new Debenture (in accordance with Section 6(d)), registered in the name of the registered transferee or assignee, representing
the outstanding Principal being transferred by the Holder and, if less then the entire outstanding Principal is being transferred, a new
Debenture (in accordance with Section 6(d)) to the Holder representing the outstanding Principal not being transferred. The Holder and
any assignee, by acceptance of this Debenture, acknowledge and agree that, by reason of the provisions of Section 4(e)(iii) following
conversion or redemption of any portion of this Debenture, the outstanding Principal represented by this Debenture may be less than the
Principal stated on the face of this Debenture.


 


(b) Lost,
Stolen or Mutilated Debenture. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Debenture, and, in the case of loss, theft or destruction, of any indemnification undertaking by the
Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of this Debenture, the Company
shall execute and deliver to the Holder a new Debenture (in accordance with Section 6(d)) representing the outstanding Principal.


 


(c) Debenture
Exchangeable for Different Denominations. This Debenture is exchangeable, upon the surrender hereof by the Holder at the principal
office of the Company, for a new Debenture or Debentures (in accordance with Section 6(d)) representing in the aggregate the outstanding
Principal of this Debenture, and each such new Debenture will represent such portion of such outstanding Principal as is designated by
the Holder at the time of such surrender.


 


(d) Issuance
of New Debentures. Whenever the Company is required to issue a new Debenture pursuant to the terms of this Debenture, such new Debenture
(i) shall be of like tenor with this Debenture, (ii) shall represent, as indicated on the face of such new Debenture, the Principal remaining
outstanding (or in the case of a new Debenture being issued pursuant to Section 6(a) or Section 6(c), the Principal designated by the
Holder which, when added to the principal represented by the other new Debentures issued in connection with such issuance, does not exceed
the Principal remaining outstanding under this Debenture immediately prior to such issuance of new Debentures), (iii) shall have an issuance
date, as indicated on the face of such new Debenture, which is the same as the Issuance Date of this Debenture, (iv) shall have the same
rights and conditions as this Debenture, and (v) shall represent accrued and unpaid Interest from the Issuance Date.


 






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(7) NOTICES. Any
notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered upon: (i) receipt, when delivered personally, (ii) 1 Business Day after deposit with an overnight
courier service with next day delivery specified, in each case, properly addressed to the party to receive the same, or (iii) receipt,
when sent by electronic mail (provided that the electronic mail transmission is not returned in error or the sender is not otherwise notified
of any error in transmission. The addresses and e-mail addresses for such communications shall be:


 


	If to the Company, to:	Samsara Luggage, Inc.
	 	One University Plaza – Suite 505
	 	Hackensack, NJ 07601
	 	
    Attention: Atara Dzikowski

    Telephone: (855) 256-7477

	 	Email: atara@samsaraluggage.com
	 	 
	With a copy to:	
    Foley Shechter Ablovatskiy LLP

    1180 Avenue of the Americas, 8th Floor

    New York, NY 10036

	 	Attention:  Jonathan Shechter
	 	Telephone: (212) 335-0465
	 	Email: js@foleyshechter.com


 


	If to the Holder:	
    YA II PN, Ltd.

    c/o Yorkville Advisors Global, LP

	 	1012 Springfield Avenue
	 	Mountainside, NJ 07092
	 	
    Attention: Mark Angelo

    Telephone: (201) 536-5109

	 	Email: mangelo@yorkvilleadvisors.com
	 	 
	With a copy to:	David Gonzalez, Esq.
	 	1012 Springfield Avenue
	 	Mountainside, NJ 07092
	 	Telephone: (201) 536-5109
	 	Email: dgonzalez@yorkvilleadvisors.com 


 


or at such other address and/or electronic email
address and/or to the attention of such other person as the recipient party has specified by written notice given to each other party
5 Business Days prior to the effectiveness of such change. Written confirmation of receipt (i) given by the recipient of such notice,
consent, waiver or other communication, (ii) mechanically or electronically generated by the sender’s computer containing the time,
date, recipient’s electronic mail address and the text of such electronic mail or (iii) provided by a nationally recognized overnight
delivery service, shall be rebuttable evidence of personal service, receipt by electronic mail or receipt from a nationally recognized
overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively.


 






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(8) Except
as expressly provided herein, no provision of this Debenture shall alter or impair the obligations of the Company, which are absolute
and unconditional, to pay the principal of, interest and other charges (if any) on, this Debenture at the time, place, and rate, and in
the coin or currency, herein prescribed. This Debenture is a direct obligation of the Company. As long as this Debenture is outstanding,
the Company shall not and shall cause their subsidiaries not to, without the consent of the Holder, (i) amend its certificate of incorporation,
bylaws or other charter documents so as to adversely affect any rights of the Holder (which shall include combining (by way of reverse
stock split) outstanding shares of Common Stock into a smaller number of shares); (ii) repay, repurchase or offer to repay, repurchase
or otherwise acquire shares of its Common Stock or other equity securities other than as to the Underlying Shares to the extent permitted
or required under the Transaction Documents; or (iii) enter into any agreement with respect to any of the foregoing.


 


(9) This
Debenture shall not entitle the Holder to any of the rights of a stockholder of the Company, including without limitation, the right to
vote, to receive dividends and other distributions, or to receive any notice of, or to attend, meetings of stockholders or any other proceedings
of the Company, unless and to the extent converted into shares of Common Stock in accordance with the terms hereof.


 


(10) No
indebtedness of the Company is senior to this Debenture in right of payment, whether with respect to interest, damages or upon liquidation
or dissolution or otherwise. Without the Holder’s consent, the Company will not and will not permit any of their subsidiaries to,
directly or indirectly, enter into, create, incur, assume or suffer to exist any indebtedness 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 there from that is senior in any
respect to the obligations of the Company under this Debenture


 


(11) This
Debenture shall be governed by and construed in accordance with the laws of the State of New Jersey, without giving effect to conflicts
of laws thereof. Each of the parties consents to the jurisdiction of the Superior Courts of the State of New Jersey sitting in Union County,
New Jersey and the U.S. District Court for the District of New Jersey sitting in Newark, New Jersey in connection with any dispute
arising under this Debenture and hereby waives, to the maximum extent permitted by law, any objection, including any objection based on
forum non conveniens to the bringing of any such proceeding in such jurisdictions.


 


(12) If
the Company fails to strictly comply with the terms of this Debenture, then the Company shall reimburse the Holder promptly for all fees,
costs and expenses, including, without limitation, reasonable attorneys’ fees and expenses incurred by the Holder in any action
in connection with this Debenture, including, without limitation, those incurred: (i) during any workout, attempted workout, and/or in
connection with the rendering of legal advice as to the Holder’s rights, remedies and obligations, (ii) collecting any sums which
become due to the Holder, (iii) defending or prosecuting any proceeding or any counterclaim to any proceeding or appeal; or (iv) the protection,
preservation or enforcement of any rights or remedies of the Holder.


 


(13) Any
waiver by the Holder of a breach of any provision of this Debenture shall not operate as or be construed to be a waiver of any other breach
of such provision or of any breach of any other provision of this Debenture. The failure of the Holder to insist upon strict adherence
to any term of this Debenture on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter
to insist upon strict adherence to that term or any other term of this Debenture. Any waiver must be in writing.


 






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(14) If
any provision of this Debenture is invalid, illegal or unenforceable, the balance of this Debenture shall remain in effect, and if any
provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances.
If it shall be found that any interest or other amount deemed interest due hereunder shall violate applicable laws governing usury, the
applicable rate of interest due hereunder shall automatically be lowered to equal the maximum permitted rate of interest. The Company
covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company from paying
all or any portion of the principal of or interest on this Debenture as contemplated herein, wherever enacted, now or at any time hereafter
in force, or which may affect the covenants or the performance of this indenture, and the Company (to the extent it may lawfully do so)
hereby expressly waives all benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder,
delay or impeded the execution of any power herein granted to the Holder, but will suffer and permit the execution of every such as though
no such law has been enacted.


 


(15) Whenever
any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall be made on the next succeeding
Business Day.


 


(16) THE
PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION DOCUMENT OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES’
ACCEPTANCE OF THIS AGREEMENT.


 


(17) CERTAIN DEFINITIONS
 For purposes of this Debenture, the following terms shall have the following meanings:


 


(a) “Approved
Stock Plan” means a stock option plan that has been approved by the Board of Directors of the Company, pursuant to which the
Company’s securities may be issued only to any employee, officer, or director or third party service providers in the normal course
of business, for services provided to the Company.


 


(b) “Bloomberg”
means Bloomberg Financial Markets.


 






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(c) “Business
Day” means any day except Saturday, Sunday and any day which shall be a federal legal holiday in the United States or a day
on which banking institutions are authorized or required by law or other government action to close.


 


(d)
“Change of Control Transaction” means the occurrence of (a) an acquisition after the date hereof by an individual or
legal entity or “group” (as described in Rule 13d-5(b)(1) promulgated under the Exchange Act) of effective control (whether
through legal or beneficial ownership of capital stock of the Company, by contract or otherwise) of in excess of 50% of the voting securities
of the Company (except that the acquisition of voting securities by the Holder or any other current holder of convertible securities of
the Company shall not constitute a Change of Control Transaction for purposes hereof), (b) a replacement at one time or over time of more
than one-half of the members of the board of directors of the Company which is not approved by a majority of those individuals who are
members of the board of directors on the date hereof (or by those individuals who are serving as members of the board of directors on
any date whose nomination to the board of directors was approved by a majority of the members of the board of directors who are members
on the date hereof), (c) the merger, consolidation or sale of 50% or more of the assets of the Company or any subsidiary of the Company
in one or a series of related transactions with or into another entity, or (d) the execution by the Company of an agreement to which the
Company is a party or by which it is bound, providing for any of the events set forth above in (a), (b) or (c).


 


(e) “Closing
Bid Price” means the price per share in the last reported trade of the Common Stock on a Primary Market or on the exchange which
the Common Stock is then listed as quoted by Bloomberg.


 


(f) “Convertible
Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exercisable or exchangeable
for Common Stock.


 


(g) “Commission”
means the Securities and Exchange Commission.


 


(h) “Common
Stock” means the common stock, par value $0.0001, of the Company and stock of any other class into which such shares may hereafter
be changed or reclassified.


 


(i) “Equity
Conditions” means that each of the following conditions is satisfied: (i) on each day during the period beginning 2 weeks prior
to the applicable date of determination and ending on and including the applicable date of determination (the “Equity Conditions
Measuring Period”), either (x) a registration statement filed pursuant to Section 5(q) shall be effective and available for the
resale of all applicable shares of Common Stock to be issued in connection with the event requiring determination or (y) all applicable
shares of Common Stock to be issued in connection with the event requiring determination shall be eligible for sale without restriction
and without the need for registration under any applicable federal or state securities laws; (ii) on each day during the Equity Conditions
Measuring Period, the Common Stock is designated for quotation on the Principal Market and shall not have been suspended from trading
on such exchange or market nor shall delisting or suspension by such exchange or market been threatened or pending either (A) in writing
by such exchange or market or (B) by falling below the then effective minimum listing maintenance requirements of such exchange or market;
(iii) during the Equity Conditions Measuring Period, the Company shall have delivered Conversion Shares upon conversion of the Debentures
to the Holder on a timely basis as set forth in Section 4(e)(i) hereof; (iv) any applicable shares of Common Stock to be issued in connection
with the event requiring determination may be issued in full without violating Section 4(f) hereof and the rules or regulations of the
Primary Market; (v) during the Equity Conditions Measuring Period, there shall not have occurred either (A) an Event of Default or (B)
an event that with giving of notice would constitute an Event of Default; and (vii) the Company shall have no knowledge of any fact that
would cause (x) registration statements filed pursuant to Section 5(q) not to be effective and available for the resale of all applicable
shares of Common Stock to be issued in connection with the event requiring determination or (y) any applicable shares of Common Stock
to be issued in connection with the event requiring determination not to be eligible for sale without restriction and without the need
for registration under any applicable federal or state securities laws.


 






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(j) “Equity
Conditions Failure” means that on any applicable date the Equity Conditions have not been satisfied (or waived in writing by
the Holder).


 


(k) “Exchange
Act” means the Securities Exchange Act of 1934, as amended.


 


(l) “Excluded
Securities” means, (a) shares issued or deemed to have been issued by the Company pursuant to an Approved Stock Plan and (b) the
shares of Common Stock issued or deemed to be issued by the Company upon conversion of this Debenture.


 


(m) “Options”
means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible Securities.


 


(n) “Original
Issue Date” means the date of the first issuance of this Debenture regardless of the number of transfers and regardless of the
number of instruments, which may be issued to evidence such Debenture.


 


(o) “Person”
means a corporation, an association, a partnership, organization, a business, an individual, a government or political subdivision thereof
or a governmental agency.


 


(p) “Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.


 


(q) “Securities
Purchase Agreement” means the Securities Purchase Agreement dated the date hereof by and among the Company and the Holder.


 


(r)
“Trading Day” means a day on which the shares of Common Stock are quoted on the Primary Market on which the shares
of Common Stock are then quoted or listed; provided, that in the event that the shares of Common Stock are not listed or quoted, then
Trading Day shall mean a Business Day.


 


(s) “Transaction
Documents” means the Securities Purchase Agreement or any other agreement delivered in connection with the Securities Purchase
Agreement and including, without limitation, the Irrevocable Transfer Agent Instructions.


 


(t) “Underlying
Shares” means the shares of Common Stock issuable upon conversion of this Debenture or as payment of interest in accordance
with the terms hereof.


 


(u) “VWAP”
means, for any security as of any date, the daily dollar volume-weighted average price for such security as reported by Bloomberg, LP
through its “Historical Price Table Screen (HP)” with Market: Weighted Avg function selected, or, if no dollar volume-weighted
average price is reported for such security by Bloomberg, the average of the highest closing bid price and the lowest closing ask price
of any of the market makers for such security as reported in the “pink sheets” by Pink Sheets LLC.


 


[Signature Page Follows]


 






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IN WITNESS WHEREOF,
the Company has caused this Convertible Debenture to be duly executed by a duly authorized officer as of the date set forth above.


 


 


	 	COMPANY:
	 	SAMSARA LUGGAGE, INC.
	 	 
	 	By:	 
	 	Name:	Atara Dzikowski
	 	Title:	Chief Executive Officer


 






     


     


    

 


EXHIBIT I

CONVERSION NOTICE


 


(To be executed by the Holder in order to
Convert the Debenture)


 


TO: 



 


The undersigned hereby irrevocably
elects to convert $                                                           of
the principal amount of Debenture No. SAML-5 1-1 into Shares of Common Stock of SAMSARA LUGGAGE, INC., according to the conditions
stated therein, as of the Conversion Date written below.


 


	Conversion Date:	_________________________________________________________
	Conversion Amount to be converted:	$_________________________________________________________
	Conversion Price:	$_________________________________________________________
	Number of shares of Common Stock to be issued:	_________________________________________________________
	Amount of Debenture Unconverted:	$



 


Please issue the shares of Common Stock in the following name and to the following address:


 


Issue to:


 


	Authorized Signature:	__________________________________________________________
	Name:	__________________________________________________________
	Title:	__________________________________________________________
	Broker DTC Participant Code:	 
	Account Number: