Document:

Exhibit 10(ii)

 

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.

 

ELECTROMEDICAL
TECHNOLOGIES, INC.

 

Convertible
Debenture

 

	Issuance Date:  February 8, 2021	Original Principal Amount:	$500,000
	 	 	 
	No. EMED-1 1-3	Original Issue Discount:	5%

 

FOR VALUE RECEIVED,
ELECTROMEDICAL TECHNOLOGIES, INC., a Delaware 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 February 8, 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 the Equity Conditions
are then satisfied converted into Common Stock at the Market Conversion Price on the Trading Day immediately prior to the date
paid.

 

(c)  
Original Issue Discount. The Original Principal Amount of this Debenture shall have an original issue discount
of 5% (the “OID”) which the Holder shall be entitled to deduct from the gross proceeds of the Original Principal
Amount when this Debenture was issued.

 

(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;

 

(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;

 

    2

     

    

 

(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 $100,000, 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 the Underlying Shares Registration Statement with the Commission, or the Underlying Shares
Registration Statement shall not have been declared effective by the Commission, in each case within 45 days of the periods set
forth in the Registration Rights Agreement (“Registration Rights Agreement”) dated the date hereof among the
Company and the Holder, or, while the Underlying Shares Registration Statement is required to be maintained effective pursuant
to the terms of the Registration Rights Agreement, the effectiveness of the Underlying Shares 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 Registration Rights Agreement) in accordance with the terms of the Registration
Rights Agreement, and such lapse or unavailability continues for a period of more than 10 consecutive Trading Days or for more
than an aggregate of 20 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 3
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);

 

    3

     

    

 

(viii)       
The Company shall fail for any reason to deliver the payment in cash pursuant to a Buy-In (as defined herein) within 3 Business
Days after such payment is due;

 

(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 15% 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.

 

    4

     

    

 

(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,
$0.40, 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,
70% of the lowest VWAP of the Company’s Common Stock during the 20 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.

 

    5

     

    

 

(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 3rd 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 3 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.

 

(ii)           Company's Failure to Timely Convert. If within 3 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 3 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.

 

    6

     

    

 

(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 4.99% 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.

 

(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 3 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.

 

    7

     

    

 

(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.

 

(5)          
Adjustments to the Fixed Conversion Price.

 

(a)  
Adjustment of Fixed Conversion Price upon Issuance of Common Stock. If the Company, at any time while this Debenture
is outstanding, issues or sells, or in accordance with this Section 5(a) is deemed to have issued or sold, any shares of Common
Stock, excluding shares of Common Stock deemed to have been issued or sold by the Company in connection with an Excluded Securities,
for a consideration per share (the “New Issuance Price”) less than a price equal to the Fixed Conversion Price
in effect immediately prior to such issue or sale (such price the "Applicable Price") (the foregoing a "Dilutive
Issuance"), then immediately after such Dilutive Issuance the Fixed Conversion Price then in effect shall be reduced to
an amount equal to the New Issuance Price. For purposes of determining the adjusted Fixed Conversion Price under this Section 5(a),
the following shall be applicable:

 

(i)            Issuance
of Options. If the Company in any manner grants or sells any Options and the lowest price per share for which one share
of Common Stock is issuable upon the exercise of any such Option or upon conversion or exchange or exercise of any
Convertible Securities issuable upon exercise of such Option is less than the Applicable Price, then such share of Common
Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the granting or sale
of such Option for such price per share. For purposes of this Section, the "lowest price per share for which one share
of Common Stock is issuable upon the exercise of any such Option or upon conversion or exchange or exercise of any
Convertible Securities issuable upon exercise of such Option" shall be equal to the sum of the lowest amounts of
consideration (if any) received or receivable by the Company with respect to any one share of Common Stock upon granting or
sale of the Option, upon exercise of the Option and upon conversion or exchange or exercise of any Convertible Securities
issuable upon exercise of such Option. No further adjustment of the Conversion Price shall be made upon the actual issuance
of such share of Common Stock or of such Convertible Securities upon the exercise of such Options or upon the actual issuance
of such Common Stock upon conversion or exchange or exercise of such Convertible Securities.

 

    8

     

    

 

(ii)           Issuance of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities and the
lowest price per share for which one share of Common Stock is issuable upon such conversion or exchange or exercise thereof is
less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold
by the Company at the time of the issuance or sale of such Convertible Securities for such price per share. For the purposes of
this Section, the "lowest price per share for which one share of Common Stock is issuable upon such conversion or exchange
or exercise" shall be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the Company
with respect to any one share of Common Stock upon the issuance or sale of the Convertible Security and upon the conversion or
exchange or exercise of such Convertible Security. No further adjustment of the Fixed Conversion Price shall be made upon the actual
issuance of such share of Common Stock upon conversion or exchange or exercise of such Convertible Securities, and if any such
issue or sale of such Convertible Securities is made upon exercise of any Options for which adjustment of the Fixed Conversion
Price had been or are to be made pursuant to other provisions of this Section, no further adjustment of the Fixed Conversion Price
shall be made by reason of such issue or sale.

 

(iii)          Change in Option Price or Rate of Conversion. If the purchase price provided for in any Options, the additional consideration,
if any, payable upon the issue, conversion, exchange or exercise of any Convertible Securities, or the rate at which any Convertible
Securities are convertible into or exchangeable or exercisable for Common Stock changes at any time, the Fixed Conversion Price
in effect at the time of such change shall be adjusted to the Conversion Price which would have been in effect at such time had
such Options or Convertible Securities provided for such changed purchase price, additional consideration or changed conversion
rate, as the case may be, at the time initially granted, issued or sold. For purposes of this Section, if the terms of any Option
or Convertible Security that was outstanding as of the Issuance Date are changed in the manner described in the immediately preceding
sentence, then such Option or Convertible Security and the Common Stock deemed issuable upon exercise, conversion or exchange thereof
shall be deemed to have been issued as of the date of such change. No adjustment shall be made if such adjustment would result
in an increase of the Conversion Price then in effect.

 

    9

     

    

 

(iv)          Calculation
of Consideration Received. In case any Option is issued in connection with the issue or sale of other securities of the
Company, together comprising one integrated transaction in which no specific consideration is allocated to such Options by
the parties thereto, the Options will be deemed to have been issued for the difference of (x) the aggregate fair market value
of such Options and other securities issued or sold in such integrated transaction, less (y) the fair market value of the
securities other than such Option, issued or sold in such transaction and the other securities issued or sold in such
integrated transaction will be deemed to have been issued or sold for the balance of the consideration received by the
Company. If any Common Stock, Options or Convertible Securities are issued or sold or deemed to have been issued or sold for
cash, the consideration received therefor will be deemed to be the gross amount raised by the Company; provided, however,
that such gross amount is not greater than 110% of the net amount received by the Company therefor. If any Common Stock,
Options or Convertible Securities are issued or sold for a consideration other than cash, the amount of the consideration
other than cash received by the Company will be the fair value of such consideration, except where such consideration
consists of securities, in which case the amount of consideration received by the Company will be the Closing Bid Price of
such securities on the date of receipt. If any Common Stock, Options or Convertible Securities are issued to the owners of
the non-surviving entity in connection with any merger in which the Company is the surviving entity, the amount of
consideration therefor will be deemed to be the fair value of such portion of the net assets and business of the
non-surviving entity as is attributable to such Common Stock, Options or Convertible Securities, as the case may be. The fair
value of any consideration other than cash or securities will be determined jointly by the Company and the Holder. If such
parties are unable to reach agreement within ten 10 days after the occurrence of an event requiring valuation (the
"Valuation Event"), the fair value of such consideration will be determined within 5 Business Days after the
10th day following the Valuation Event by an independent, reputable appraiser jointly selected by the Company and
the Holder. The determination of such appraiser shall be deemed binding upon all parties absent manifest error and the fees
and expenses of such appraiser shall be borne by the Company.

 

(v)           Record Date. If the Company takes a record of the holders of Common Stock for the purpose of entitling them (A) to
receive a dividend or other distribution payable in Common Stock, Options or in Convertible Securities or (B) to subscribe for
or purchase Common Stock, Options or Convertible Securities, then such record date will be deemed to be the date of the issue or
sale of the Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution
or the date of the granting of such right of subscription or purchase, as the case may be.

 

(b)  
Adjustment of the Fixed Conversion Price upon Subdivision or Combination of Common Stock. If the Company, at any
time while this Debenture is outstanding, shall (a) pay a stock dividend or otherwise make a distribution or distributions
on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock, (b) subdivide
outstanding shares of Common Stock into a larger number of shares, (c) combine (including by way of reverse stock split) outstanding
shares of Common Stock into a smaller number of shares, or (d) issue by reclassification of shares of the Common Stock any shares
of capital stock of the Company, then the Fixed Conversion Price shall be multiplied by a fraction of which the numerator shall
be the number of shares of Common Stock (excluding treasury shares, if any) outstanding before such event and of which the denominator
shall be the number of shares of Common Stock outstanding after such event. Any adjustment made pursuant to this Section shall
become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

    10

     

    

 

(c)   Purchase
Rights. If at any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase
stock, warrants, securities or other property pro rata to the record holders of any class of Common Stock (the
"Purchase Rights"), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase
Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of
Common Stock acquirable upon complete conversion of this Debenture (without taking into account any limitations or
restrictions on the convertibility of this Debenture) 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.

 

(d)  
Other Events. If any event occurs of the type contemplated by the provisions of this Section 5 but not expressly
provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights
or other rights with equity features), then the Company's Board of Directors will make an appropriate adjustment in the Conversion
Price so as to protect the rights of the Holder under this Debenture; provided that no such adjustment will increase the Conversion
Price as otherwise determined pursuant to this Section 5.

 

(e)  
Other Corporate Events. In addition to and not in substitution for any other rights hereunder, prior to the consummation
of any Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled to receive securities or other
assets with respect to or in exchange for shares of Common Stock (a "Corporate Event"), the Company shall make
appropriate provision to insure that the Holder will thereafter have the right to receive upon a conversion of this Debenture,
at the Holder's option, (i) in addition to the shares of Common Stock receivable upon such conversion, such securities or other
assets to which the Holder would have been entitled with respect to such shares of Common Stock had such shares of Common Stock
been held by the Holder upon the consummation of such Corporate Event (without taking into account any limitations or restrictions
on the convertibility of this Debenture) or (ii) in lieu of the shares of Common Stock otherwise receivable upon such conversion,
such securities or other assets received by the holders of shares of Common Stock in connection with the consummation of such Corporate
Event in such amounts as the Holder would have been entitled to receive had this Debenture initially been issued with conversion
rights for the form of such consideration (as opposed to shares of Common Stock) at a conversion rate for such consideration commensurate
with the Conversion Rate. Provision made pursuant to the preceding sentence shall be in a form and substance satisfactory to the
Required Holders. The provisions of this Section shall apply similarly and equally to successive Corporate Events and shall be
applied without regard to any limitations on the conversion or redemption of this Debenture.

 

(f)   
Whenever the Fixed Conversion Price is adjusted pursuant to Section 5 hereof, the Company shall promptly mail to the Holder
a notice setting forth the Fixed Conversion Price after such adjustment and setting forth a brief statement of the facts requiring
such adjustment.

 

    11

     

    

 

(g)   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.

 

    12

     

    

 

(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.

 

(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:	Electromedical Technologies, Inc.
	 	16561 N. 92nd Street – Suite 101
	 	Scottsdale, AZ 85260
	 	Attention: Matthew Wolfson
 Telephone: (602) 790-8034
	 	Email:    ceo@electromedtech.com  
	 	 
	With a copy to:	Mailander Law Office, Inc.
 481 49th Street
 San Diego, CA 92115
	 	Attention:  Tad Mailander
	 	Telephone: (619) 239-9034
	 	Email: tad@mailanderlaw.net

 

	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 

 

    13

     

    

 

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 3 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.

 

(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.

 

    14

     

    

 

(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, 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.

 

    15

     

    

 

(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.

 

(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).

 

    16

     

    

 

(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 $0.00001, 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) the Underlying Shares Registration Statement filed pursuant
to the Registration Rights Agreement 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 the passage of time or giving of notice would constitute an Event of Default; and (vii) the Company
shall have no knowledge of any fact that would cause (x) the Underlying Shares Registration Statements required pursuant to the
Registration Rights Agreement 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.

 

    17

     

    

 

(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, including, without limitation, the Warrant, the Irrevocable Transfer Agent Instructions,
and the Registration Rights Agreement.

 

(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)  
“Underlying Shares Registration Statement” means a registration statement meeting the requirements set
forth in the Registration Rights Agreement, covering among other things the resale of the Underlying Shares and naming the Holder
as a “selling stockholder” thereunder.

 

(v)   "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 Ave 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]

 

    18

     

    

 

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:
	 	ELECTROMEDICAL TECHNOLOGIES, INC.
	 	 
	 	By:	                                 
	 	Name: 
	 	Title: 
	 	 

 

     

     

    

 

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. EMED 1 1-3 into Shares of Common Stock
of ELECTROMEDICAL TECHNOLOGIES, 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:Exhibit 10(iii)

 

EXECUTION VERSION

 

WARRANT

 

THE SECURITIES REPRESENTED BY THIS WARRANT
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES HAVE
BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF
COUNSEL IN GENERALLY ACCEPTABLE FORM THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS
SOLD PURSUANT TO RULE 144 UNDER SAID ACT.

 

ELECTROMEDICAL TECHNOLOGIES, INC.

 

Warrant To Purchase Common Stock

 

	Warrant No.: EMED -1 1-1	Number of Shares:	 2,500,000
	 	 	 
	 	Warrant Exercise Price:	 $0.40
	 	 	 
	 	Expiration Date:	 February 8, 2026

 

Date of Issuance: February 8, 2021

 

Electromedical Technologies, Inc., a
Delaware corporation (the “Company”), hereby certifies that, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, YAII PN, LTD. (the “Holder”), the
registered holder hereof or its permitted assigns, is entitled, subject to the terms set forth below, to purchase from the
Company upon surrender of this Warrant, at any time or times on or after the date hereof, but not after 11:59 P.M.
Eastern Time on the Expiration Date (as defined herein) up to 2,500,000 fully paid and nonassessable shares of Common Stock
(as defined herein) of the Company (the “Warrant Shares”) at the exercise price per share provided in
Section 1(b) below or as subsequently adjusted; provided, however, that in no event shall the holder be entitled to
exercise this Warrant for a number of Warrant Shares in excess of that number of Warrant Shares which, upon giving effect to
such exercise, would cause the aggregate number of shares of Common Stock beneficially owned by the holder and its affiliates
to exceed 4.99% of the outstanding shares of the Common Stock following such exercise, except within 60 days of the
Expiration Date (however, such restriction may be waived by Holder (but only as to itself and not to any other holder) upon
not less than 65 days prior notice to the Company). For purposes of the foregoing proviso, the aggregate number of shares of
Common Stock beneficially owned by the holder and its affiliates shall include the number of shares of Common Stock issuable
upon exercise of this Warrant with respect to which the determination of such proviso is being made, but shall exclude shares
of Common Stock which would be issuable upon (i) exercise of the remaining, unexercised Warrants beneficially owned by
the holder and its affiliates and (ii) exercise or conversion of the unexercised or unconverted portion of any other
securities of the Company beneficially owned by the holder and its affiliates (including, without limitation, any convertible
notes or preferred stock) subject to a limitation on conversion or exercise analogous to the limitation contained herein.
Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in
accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended. For purposes of this Warrant, in
determining the number of outstanding shares of Common Stock a holder may rely on the number of outstanding shares of Common
Stock as reflected in (1) the Company’s most recent Form 10-Q or Form 10-K, as the case may be, (2) a more recent
public announcement by the Company or (3) any other notice by the Company or its transfer agent setting forth the number of
shares of Common Stock outstanding. Upon the written request of any holder, the Company shall promptly, but in no event later
than 1 Business Day following the receipt of such notice, confirm in writing to any such holder the number of shares of
Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving
effect to the exercise of Warrants (as defined below) by such holder and its affiliates since the date as of which such
number of outstanding shares of Common Stock was reported.

 

     

     

    

 

Section 1. 

 

(a)  
This Warrant is issued pursuant to the Securities Purchase Agreement (“Securities Purchase Agreement”)
dated the date hereof between the Company and the Holder or issued in exchange or substitution thereafter or replacement thereof.
Each Capitalized term used, and not otherwise defined herein, shall have the meaning ascribed thereto in the Securities Purchase
Agreement.

 

(b)  
Definitions. The following words and terms as used in this Warrant shall have the following meanings:

 

(i)                
“Approved Stock Plan” means a stock plan that has been approved by the Board of Directors of the Company
prior to the date of the Securities Purchase Agreement, pursuant to which the Company’s securities may be issued only to
any employee, officer or director for services provided to the Company.

 

(ii)             
 “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in the
City of New York are authorized or required by law to remain closed.

 

(iii)           
“Closing Bid Price” means the closing bid price (or closing trade if there is no closing bid price) of
Common Stock as quoted on the Principal Market (as reported by Bloomberg, LP (“Bloomberg”) through its “Volume
at Price” function).

 

(iv)            
“Common Stock” means (i) the Company’s common stock, par value $0.00001 per share, and (ii) any
capital stock into which such Common Stock shall have been changed or any capital stock resulting from a reclassification of such
Common Stock.

 

    2

     

    

 

(v)              
 “Event of Default” means an event of default under the Securities Purchase Agreement or the Convertible
Debenture issued in connection therewith.

 

(vi)            
“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 the
Convertible Debenture or exercise of the Warrants.

 

(vii)         
“Expiration Date” means the date set forth on the first page of this Warrant.

 

(viii)       
“Issuance Date” means the date hereof.

 

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

 

(x)              
 “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation,
a trust, an unincorporated organization and a government or any department or agency thereof.

 

(xi)            
“Primary Market” means the OTC Markets’ OTCQBÒ
Market.

 

(xii)         
“Securities Act” means the Securities Act of 1933, as amended.

 

(xiii)       
“Warrant” means this Warrant and all Warrants issued in exchange, transfer or replacement thereof.

 

(xiv)        
“Warrant Exercise Price” shall be $0.40 or as subsequently adjusted as provided in Section 8 hereof.

 

(c)  
Other Definitional Provisions.

 

(i)              Except as otherwise specified herein, all references herein (A) to the Company shall be deemed to include the Company’s
successors and (B) to any applicable law defined or referred to herein shall be deemed references to such applicable law as
the same may have been or may be amended or supplemented from time to time.

 

(ii)             
When used in this Warrant, the words “herein”, “hereof”, and “hereunder”
and words of similar import, shall refer to this Warrant as a whole and not to any provision of this Warrant, and the words “Section”,
“Schedule”, and “Exhibit” shall refer to Sections of, and Schedules and Exhibits to, this
Warrant unless otherwise specified.

 

(iii)           
Whenever the context so requires, the neuter gender includes the masculine or feminine, and the singular number includes
the plural, and vice versa.

 

    3

     

    

 

Section 2. Exercise
of Warrant.

 

(a)  
 Subject to the terms and conditions hereof, this Warrant may be exercised by the holder hereof then registered on the books
of the Company, pro rata as hereinafter provided, at any time on any Business Day on or after the opening of business on such Business
Day, commencing with the first day after the date hereof, and prior to 5:00 P.M. Eastern Time on the Expiration Date (i) by delivery
of a written notice, in the form of the subscription notice attached as Exhibit A hereto (the “Exercise Notice”),
of such holder’s election to exercise this Warrant, which notice shall specify the number of Warrant Shares to be purchased, payment
to the Company of an amount equal to the Warrant Exercise Price(s) applicable to the Warrant Shares being purchased, multiplied
by the number of Warrant Shares (at the applicable Warrant Exercise Price) as to which this Warrant is being exercised (plus
any applicable issue or transfer taxes) (the “Aggregate Exercise Price”) in cash or wire transfer of immediately
available funds and the surrender of this Warrant (or an indemnification undertaking with respect to this Warrant in the case of
its loss, theft or destruction) to a common carrier for overnight delivery to the Company or (ii) if at the time of exercise, the
Warrant Shares are not subject to an effective registration statement or if an Event of Default has occurred and is continuing,
by delivering an Exercise Notice and in lieu of making payment of the Aggregate Exercise Price in cash or wire transfer, elect
instead to receive upon such exercise the “Net Number” of shares of Common Stock determined according to the following
formula (the “Cashless Exercise”):

 

Net Number = (A x B) – (A x C)

B

 

For purposes of the foregoing
formula:

 

A = the total number of Warrant Shares with respect
to which this Warrant is then being exercised.

 

B = the Closing Bid Price of the Common Stock on the
date of exercise of the Warrant.

 

C = the Warrant Exercise Price then in effect for the
applicable Warrant Shares at the time of such exercise.

 

In the event of
any exercise of the rights represented by this Warrant in compliance with this Section 2, the Company shall on or before the
3rd Business Day following the date of receipt of the Exercise Notice, the Aggregate Exercise Price and this
Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction) and
the receipt of the representations of the holder specified in Section 6 hereof, if requested by the Company (the
“Exercise Delivery Documents”), and if the Warrant Shares are subject to an effective and current
Registration Statement and the Common Stock is DTC eligible, 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 The Depository Trust Company;
provided, however, if the holder who submitted the Exercise Notice requested physical delivery of any or all of the Warrant
Shares, or, if the Warrant Shares are not subject to an effective and current Registration Statement and the Common Stock is
not DTC eligible then the Company shall, on or before the 3rd Business Day following receipt of the Exercise
Delivery Documents, issue and surrender to a common carrier for overnight delivery to the address specified in the Exercise
Notice, a certificate, registered in the name of the holder, for the number of shares of Common Stock to which the holder
shall be entitled pursuant to such request. The Warrant Shares shall be issued with a legend unless they are subject to an
effective and current Registration Statement or they are being transferred pursuant to an exemption from such registration
requirements, the availability of which is confirmed in an opinion of counsel acceptable to the Company’s Transfer
Agent. Upon delivery of the Exercise Notice and Aggregate Exercise Price referred to in clause (i) or (ii) above the
holder of this Warrant shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares
with respect to which this Warrant has been exercised. In the case of a dispute as to the determination of the Warrant
Exercise Price, the Closing Bid Price or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue
to the holder the number of Warrant Shares that is not disputed and shall submit the disputed determinations or arithmetic
calculations to the holder via facsimile within 1 Business Day of receipt of the holder’s Exercise Notice.

 

    4

     

    

 

(b)  
If the holder and the Company are unable to agree upon the determination of the Warrant Exercise Price or arithmetic calculation
of the Warrant Shares within 1 day of such disputed determination or arithmetic calculation being submitted to the holder, then
the Company shall immediately submit via electronic mail (i) the disputed determination of the Warrant Exercise Price or the Closing
Bid Price to an independent, reputable investment banking firm or (ii) the disputed arithmetic calculation of the Warrant Shares
to its independent, outside accountant. The Company shall cause the investment banking firm or the accountant, as the case may
be, to perform the determinations or calculations and notify the Company and the holder of the results no later than 72 hours from
the time it receives the disputed determinations or calculations. Such investment banking firm’s or accountant’s determination
or calculation, as the case may be, shall be deemed conclusive absent manifest error.

 

(c)  
Unless the rights represented by this Warrant shall have expired or shall have been fully exercised, the Company shall,
as soon as practicable and in no event later than 5 Business Days after any exercise and at its own expense, issue a new Warrant
identical in all respects to this Warrant exercised except it shall represent rights to purchase the number of Warrant Shares purchasable
immediately prior to such exercise under this Warrant exercised, less the number of Warrant Shares with respect to which such Warrant
is exercised.

 

(d)  
No fractional Warrant Shares are to be issued upon any pro rata exercise of this Warrant, but rather the number of Warrant
Shares issued upon such exercise of this Warrant shall be rounded up or down to the nearest whole number.

 

(e)   If
the Company or its Transfer Agent shall fail for any reason or for no reason to issue to the holder within 5 days of receipt
of the Exercise Delivery Documents, a certificate for the number of Warrant Shares to which the holder is entitled or to
credit the holder’s balance account with The Depository Trust Company for such number of Warrant Shares to which the
holder is entitled upon the holder’s exercise of this Warrant, unless such failure results from a failure of the
Company’s Transfer Agent to issue such shares as a result of an act of terrorism, war, natural disaster, act of god or
other force majure event, the Company shall, in addition to any other remedies under this Warrant or otherwise available to
such holder, pay as additional damages in cash to such holder on each day the issuance of such certificate for Warrant Shares
is not timely effected an amount equal to 0.025% of the product of (A) the sum of the number of Warrant Shares not issued to
the holder on a timely basis and to which the holder is entitled, and (B) the Closing Bid Price of the Common Stock for the
trading day immediately preceding the last possible date which the Company could have issued such Common Stock to the holder
without violating this Section 2.

 

    5

     

    

 

(f)   
If within 5 days after the Company’s receipt of the Exercise Delivery Documents and the written request of the Holder
that a new Warrant be issued, the Company fails to deliver a new Warrant to the holder for the number of Warrant Shares to which
such holder is entitled pursuant to Section 2 hereof, then, in addition to any other available remedies under this Warrant, or
otherwise available to such holder, the holder shall be entitled to exercise or transfer its rights under such new warrant as if
it had received such new Warrant and the Company shall be obligated to honor such exercises or transfers as if the holder had submitted
the new Warrant without violating this Section 2.

 

Section 3. Covenants
as to Common Stock. The Company hereby covenants and agrees as follows:

 

(a)  
This Warrant is, and any Warrants issued in substitution for or replacement of this Warrant will upon issuance be, duly
authorized and validly issued.

 

(b)  
All Warrant Shares which may be issued upon the exercise of the rights represented by this Warrant will, upon issuance,
be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issue thereof.

 

(c)  
During the period within which the rights represented by this Warrant may be exercised, the Company will at all times have
authorized and reserved at least 100% of the number of shares of Common Stock needed to provide for the exercise of the rights
then represented by this Warrant and the par value of said shares will at all times be less than or equal to the applicable Warrant
Exercise Price. If at any time the Company does not have a sufficient number of shares of Common Stock authorized and available,
then the Company shall call and hold a special meeting of its stockholders within 60 days of that time for the sole purpose of
increasing the number of authorized shares of Common Stock.

 

(d)  
If at any time after the date hereof the Company shall file a Registration Statement, the Company shall include the Warrant
Shares issuable to the holder, pursuant to the terms of this Warrant and shall maintain, so long as any other shares of Common
Stock shall be so listed, such listing of all Warrant Shares from time to time issuable upon the exercise of this Warrant on the
Primary Market or such national securities exchange or automated quotation system on which the Common Stock of the Company is listed;
and the Company shall so list on the Primary Market or such national securities exchange or automated quotation system on which
the Common Stock of the Company is listed, as the case may be, and shall maintain such listing of, any other shares of capital
stock of the Company issuable upon the exercise of this Warrant Shares if and so long as any shares of the same class shall be
listed on the Primary Market or such national securities exchange or automated quotation system on which the Common Stock of the
Company is listed.

 

    6

     

    

 

(e)  
 The Company will not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets,
consolidation, merger, 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 to be observed or performed by it hereunder, but will at all times in good faith assist in the
carrying out of all the provisions of this Warrant and in the taking of all such action as may reasonably be requested by the holder
of this Warrant in order to protect the exercise privilege of the holder of this Warrant against dilution or other impairment,
consistent with the tenor and purpose of this Warrant. The Company will not increase the par value of any shares of Common Stock
receivable upon the exercise of this Warrant above the Warrant Exercise Price then in effect, and (ii) will take all such
actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable
shares of Common Stock upon the exercise of this Warrant.

 

(f)   
This Warrant will be binding upon any entity succeeding to the Company by merger, consolidation or acquisition of all or
substantially all of the Company’s assets.

 

Section 4. Taxes.
The Company shall pay any and all taxes, except any applicable withholding, which may be payable with respect to the issuance and
delivery of Warrant Shares upon exercise of this Warrant.

 

Section 5. Warrant
Holder Not Deemed a Stockholder. Except as otherwise specifically provided herein, no holder, as such, of this Warrant shall
be entitled to vote or receive dividends or be deemed the holder of shares of capital stock of the Company for any purpose, nor
shall anything contained in this Warrant be construed to confer upon the holder hereof, as such, any of the rights of a stockholder
of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of stock,
reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription
rights, or otherwise, prior to the issuance to the holder of this Warrant of the Warrant Shares which he or she is then entitled
to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing
any liabilities on such holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the
Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section 5, the
Company will provide the holder of this Warrant with copies of the same notices and other information given to the stockholders
of the Company generally, contemporaneously with the giving thereof to the stockholders.

 

Section
6. Representations of Holder. The holder of this Warrant, by the acceptance hereof, represents that it is acquiring
this Warrant and the Warrant Shares for its own account for investment only and not with a view towards, or for resale in
connection with, the public sale or distribution of this Warrant or the Warrant Shares, except pursuant to sales registered
or exempted under the Securities Act; provided, however, that by making the representations herein, the holder does not agree
to hold this Warrant or any of the Warrant Shares for any minimum or other specific term and reserves the right to dispose of
this Warrant and the Warrant Shares at any time in accordance with or pursuant to a registration statement or an exemption
under the Securities Act. The holder of this Warrant further represents, by acceptance hereof, that, as of this date, such
holder is an “accredited investor” as such term is defined in Rule 501(a)(1) of Regulation D promulgated by
the Securities and Exchange Commission under the Securities Act (an “Accredited Investor”). Upon exercise
of this Warrant the holder shall, if requested by the Company, confirm in writing, in a form satisfactory to the Company,
that the Warrant Shares so purchased are being acquired solely for the holder’s own account and not as a nominee for
any other party, for investment, and not with a view toward distribution or resale and that such holder is an Accredited
Investor. If such holder cannot make such representations because they would be factually incorrect, it shall be a condition
to such holder’s exercise of this Warrant that the Company receive such other representations as the Company considers
reasonably necessary to assure the Company that the issuance of its securities upon exercise of this Warrant shall not
violate any United States or state securities laws.

 

    7

     

    

 

Section 7. Ownership
and Transfer.

 

(a)  
The Company shall maintain at its principal executive offices (or such other office or agency of the Company as it may designate
by notice to the holder hereof), a register for this Warrant, in which the Company shall record the name and address of the person
in whose name this Warrant has been issued, as well as the name and address of each transferee. The Company may treat the person
in whose name any Warrant is registered on the register as the owner and holder thereof for all purposes, notwithstanding any notice
to the contrary, but in all events recognizing any transfers made in accordance with the terms of this Warrant.

 

Section 8. Adjustment
of Warrant Exercise Price. The Warrant Exercise Price of this Warrant shall be adjusted from time to time as follows:

 

(a)  
Adjustment of Warrant Exercise Price. If and whenever on or after the Issuance Date of this Warrant, the Company
issues or sells, or is deemed to have issued or sold, any shares of Common Stock (other than Excluded Securities for a consideration
per share (the “New Issuance Price”) less than the Fixed Conversion Price of the Convertible Debenture, issued
pursuant to the Securities Purchase Agreement, in effect immediately prior to such issuance or sale (the “Applicable Price”),
then immediately after such issue or sale the Warrant Exercise Price then in effect shall be reduced to an amount equal to such
New Issuance Price.

 

(b)  
Effect on Warrant Exercise Price of Certain Events. For purposes of determining the adjusted Warrant Exercise Price
under Section 8(a) above, the following shall be applicable:

 

(i)              Issuance
of Options. If after the date hereof, the Company in any manner grants any Options and the lowest price per share for
which one share of Common Stock is issuable upon the exercise of any such Option or upon conversion or exchange of any
convertible securities issuable upon exercise of any such Option is less than the Applicable Price, then such share of Common
Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the granting or sale
of such Option for such price per share. For purposes of this Section 8(b)(i), the lowest price per share for which one share
of Common Stock is issuable upon exercise of such Options or upon conversion or exchange of such Convertible Securities shall
be equal to the sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to any
one share of Common Stock upon the granting or sale of the Option, upon exercise of the Option or upon conversion or exchange
of any convertible security issuable upon exercise of such Option. No further adjustment of the Warrant Exercise Price shall
be made upon the actual issuance of such Common Stock or of such convertible securities upon the exercise of such Options or
upon the actual issuance of such Common Stock upon conversion or exchange of such convertible securities.

 

    8

     

    

 

(ii)            Issuance of Convertible Securities. If the Company in any manner issues or sells any convertible securities and the
lowest price per share for which 1 share of Common Stock is issuable upon the conversion or exchange thereof is less than the Applicable
Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the
time of the issuance or sale of such convertible securities for such price per share. For the purposes of this Section 8(b)(ii),
the lowest price per share for which one share of Common Stock is issuable upon such conversion or exchange shall be equal to the
sum of the lowest amounts of consideration (if any) received or receivable by the Company with respect to one share of Common Stock
upon the issuance or sale of the convertible security and upon conversion or exchange of such convertible security. No further
adjustment of the Warrant Exercise Price shall be made upon the actual issuance of such Common Stock upon conversion or exchange
of such convertible securities, and if any such issue or sale of such convertible securities is made upon exercise of any Options
for which adjustment of the Warrant Exercise Price had been or are to be made pursuant to other provisions of this Section 8(b),
no further adjustment of the Warrant Exercise Price shall be made by reason of such issue or sale.

 

(iii)           Change in Option Price or Rate of Conversion. If the purchase price provided for in any Options, the additional consideration,
if any, payable upon the issue, conversion or exchange of any convertible securities, or the rate at which any convertible securities
are convertible into or exchangeable for Common Stock changes at any time, the Warrant Exercise Price in effect at the time of
such change shall be adjusted to the Warrant Exercise Price which would have been in effect at such time had such Options or convertible
securities provided for such changed purchase price, additional consideration or changed conversion rate, as the case may be, at
the time initially granted, issued or sold. For purposes of this Section 8(b)(iii), if the terms of any Option or convertible security
that was outstanding as of the Issuance Date of this Warrant are changed in the manner described in the immediately preceding sentence,
then such Option or convertible security and the Common Stock deemed issuable upon exercise, conversion or exchange thereof shall
be deemed to have been issued as of the date of such change. No adjustment pursuant to this Section 8(b) shall be made if
such adjustment would result in an increase of the Warrant Exercise Price then in effect.

 

(iv)           Calculation
of Consideration Received. If any Common Stock, Options or convertible securities are issued or sold or deemed to have
been issued or sold for cash, the consideration received therefore will be deemed to be the net amount received by the
Company therefore. If any Common Stock, Options or convertible securities are issued or sold for a consideration other than
cash, the amount of such consideration received by the Company will be the fair value of such consideration, except where
such consideration consists of marketable securities, in which case the amount of consideration received by the Company will
be the market price of such securities on the date of receipt of such securities. If any Common Stock, Options or convertible
securities are issued to the owners of the non-surviving entity in connection with any merger in which the Company is the
surviving entity, the amount of consideration therefore will be deemed to be the fair value of such portion of the net assets
and business of the non-surviving entity as is attributable to such Common Stock, Options or convertible securities, as the
case may be. The fair value of any consideration other than cash or securities will be determined jointly by the Company and
the holders of Warrants representing at least two-thirds (b) of the Warrant Shares issuable upon exercise of the Warrants
then outstanding. If such parties are unable to reach agreement within ten (10) days after the occurrence of an event
requiring valuation (the “Valuation Event”), the fair value of such consideration will be determined
within five (5) Business Days after the tenth (10th) day following the Valuation Event by an independent,
reputable appraiser jointly selected by the Company and the holders of Warrants representing at least two-thirds (b) of the
Warrant Shares issuable upon exercise of the Warrants then outstanding. The determination of such appraiser shall be final
and binding upon all parties and the fees and expenses of such appraiser shall be borne jointly by the Company and the
holders of Warrants.

 

    9

     

    

 

(v)            Integrated Transactions. In case any Option is issued in connection with the issue or sale of other securities of
the Company, together comprising one integrated transaction in which no specific consideration is allocated to such Options by
the parties thereto, the Options will be deemed to have been issued for a consideration of $.01.

 

(vi)           Treasury Shares. The number of shares of Common Stock outstanding at any given time does not include shares owned
or held by or for the account of the Company, and the disposition of any shares so owned or held will be considered an issue or
sale of Common Stock.

 

(vii)         
Record Date. If the Company takes a record of the holders of Common Stock for the purpose of entitling them (1) to
receive a dividend or other distribution payable in Common Stock, Options or in convertible securities or (2) to subscribe
for or purchase Common Stock, Options or convertible securities, then such record date will be deemed to be the date of the issue
or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of
such other distribution or the date of the granting of such right of subscription or purchase, as the case may be.

 

(c)  
Adjustment of Warrant Exercise Price upon Subdivision or Combination of Common Stock. If the Company at any time
after the date of issuance of this Warrant subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or
more classes of its outstanding shares of Common Stock into a greater number of shares, any Warrant Exercise Price in effect immediately
prior to such subdivision will be proportionately reduced and the number of shares of Common Stock obtainable upon exercise of
this Warrant will be proportionately increased. If the Company at any time after the date of issuance of this Warrant combines
(by combination, reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller
number of shares, any Warrant Exercise Price in effect immediately prior to such combination will be proportionately increased
and the number of Warrant Shares issuable upon exercise of this Warrant will be proportionately decreased. Any adjustment under
this Section 8(c) shall become effective at the close of business on the date the subdivision or combination becomes effective.

 

    10

     

    

 

(d)  
 Distribution of Assets. If the Company shall declare or make any dividend or other distribution of its assets (or
rights to acquire its assets) to holders of Common Stock, by way of return of capital or otherwise (including, without limitation,
any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate
rearrangement or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant,
then, in each such case:

 

(i)              any Warrant Exercise Price in effect immediately prior to the close of business on the record date fixed for the determination
of holders of Common Stock entitled to receive the Distribution shall be reduced, effective as of the close of business on such
record date, to a price determined by multiplying such Warrant Exercise Price by a fraction of which (A) the numerator shall be
the Closing Sale Price of the Common Stock on the trading day immediately preceding such record date minus the value of the Distribution
(as determined in good faith by the Company’s Board of Directors) applicable to one share of Common Stock, and (B) the denominator
shall be the Closing Sale Price of the Common Stock on the trading day immediately preceding such record date; and

 

(ii)             either (A) the number of Warrant Shares obtainable upon exercise of this Warrant shall be increased to a number of shares
equal to the number of shares of Common Stock obtainable immediately prior to the close of business on the record date fixed for
the determination of holders of Common Stock entitled to receive the Distribution multiplied by the reciprocal of the fraction
set forth in the immediately preceding clause (i), or (B) in the event that the Distribution is of common stock of a company whose
common stock is traded on a national securities exchange or a national automated quotation system, then the holder of this Warrant
shall receive an additional warrant to purchase Common Stock, the terms of which shall be identical to those of this Warrant, except
that such warrant shall be exercisable into the amount of the assets that would have been payable to the holder of this Warrant
pursuant to the Distribution had the holder exercised this Warrant immediately prior to such record date and with an exercise price
equal to the amount by which the exercise price of this Warrant was decreased with respect to the Distribution pursuant to the
terms of the immediately preceding clause (i).

 

(e)  
Certain Events. If any event occurs of the type contemplated by the provisions of this Section 8 but not expressly
provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights
or other rights with equity features), then the Company’s Board of Directors will make an appropriate adjustment in the Warrant
Exercise Price and the number of shares of Common Stock obtainable upon exercise of this Warrant so as to protect the rights of
the holders of the Warrants; provided, except as set forth in section 8(c),that no such adjustment pursuant to this Section 8(e)
will increase the Warrant Exercise Price or decrease the number of shares of Common Stock obtainable as otherwise determined pursuant
to this Section 8.

 

(f)   
Voluntary Adjustments By Company. The Company may at any time during the term of this Warrant reduce the then current
Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the Company.

 

    11

     

    

 

(g)  
 Notices.

 

(i)              Immediately upon any adjustment of the Warrant Exercise Price, the Company will give written notice thereof to the holder
of this Warrant, setting forth in reasonable detail, and certifying, the calculation of such adjustment.

 

(ii)             The Company will give written notice to the holder of this Warrant at least ten (10) days prior to the date on which the
Company closes its books or takes a record (A) with respect to any dividend or distribution upon the Common Stock, (B) with
respect to any pro rata subscription offer to holders of Common Stock or (C) for determining rights to vote with respect to
any Organic Change (as defined below), dissolution or liquidation, provided that such information shall be made known to the public
prior to or in conjunction with such notice being provided to such holder.

 

(iii)            The Company will also give written notice to the holder of this Warrant at least 10 days prior to the date on which any
Organic Change, dissolution or liquidation will take place, provided that such information shall be made known to the public prior
to or in conjunction with such notice being provided to such holder.

 

Section 9. Purchase
Rights; Reorganization, Reclassification, Consolidation, Merger or Sale.

 

(a)  
In addition to any adjustments pursuant to Section 8 above, if at any time the Company grants, issues or sells any Options,
convertible securities or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any
class of Common Stock (the “Purchase Rights”), then the holder of this Warrant 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 exercise of this Warrant 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.

 

(b)   Any
recapitalization, reorganization, reclassification, consolidation, merger, sale of all or substantially all of the
Company’s assets to another Person or other transaction in each case which is effected in such a way that holders of
Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with
respect to or in exchange for Common Stock is referred to herein as an “Organic Change.” Prior to the
consummation of any (i) sale of all or substantially all of the Company’s assets to an acquiring Person or (ii) other
Organic Change following which the Company is not a surviving entity, the Company will secure from the Person purchasing such
assets or the successor resulting from such Organic Change (in each case, the “Acquiring Entity”) a
written agreement (in form and substance satisfactory to the holders of Warrants representing at least two-thirds
(iii) of the Warrant Shares issuable upon exercise of the Warrants then outstanding) to deliver to each holder of
Warrants in exchange for such Warrants, a security of the Acquiring Entity evidenced by a written instrument substantially
similar in form and substance to this Warrant and satisfactory to the holders of the Warrants (including an adjusted warrant
exercise price equal to the value for the Common Stock reflected by the terms of such consolidation, merger or sale, and
exercisable for a corresponding number of shares of Common Stock acquirable and receivable upon exercise of the Warrants
without regard to any limitations on exercise, if the value so reflected is less than any Applicable Warrant Exercise Price
immediately prior to such consolidation, merger or sale). Prior to the consummation of any other Organic Change, the Company
shall make appropriate provision (in form and substance satisfactory to the holders of Warrants representing a majority of
the Warrant Shares issuable upon exercise of the Warrants then outstanding) to insure that each of the holders of the
Warrants will thereafter have the right to acquire and receive in lieu of or in addition to (as the case may be) the Warrant
Shares immediately theretofore issuable and receivable upon the exercise of such holder’s Warrants (without regard
to any limitations on exercise), such shares of stock, securities or assets that would have been issued or payable in such
Organic Change with respect to or in exchange for the number of Warrant Shares which would have been issuable and receivable
upon the exercise of such holder’s Warrant as of the date of such Organic Change (without taking into account any
limitations or restrictions on the exercisability of this Warrant).

 

    12

     

    

 

Section 10. Lost,
Stolen, Mutilated or Destroyed Warrant. If this Warrant is lost, stolen, mutilated or destroyed, the Company shall promptly,
on receipt of an indemnification undertaking (or, in the case of a mutilated Warrant, the Warrant), issue a new Warrant of like
denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed.

 

Section 11. Notice.
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 Holder:	YAII PN, Ltd.
	 	1012 Springfield Avenue
	 	Mountainside, NJ 07092
	 	Attention:	Mark A. Angelo
	 	Telephone:	(201) 536-5114
	 	Email: mangelo@yorkvilleadvisors.com
	 	 
	With Copy to:	David Gonzalez, Esq.
	 	1012 Springfield Avenue
	 	Mountainside, NJ 07092
	 	Telephone:	(201) 536-5109
	 	Email: dgonzalez@yorkvilleadvisors.com

 

    13

     

    

 

	If to the Company, to:	Electromedical Technologies, Inc.
	 	16561 N. 92nd Street – Suite 101
	 	Scottsdale, AZ 85260
	 	Attention:
	 	Telephone:	 (602) 790-8034
	 	Email:	 ceo@electromedtech.com
	 	 
	With a copy to:	Mailander Law Office, Inc.
 4811 49th Street
 San Diego, CA 92115
	 	Attention:	Tad Mailander
	 	Telephone:	 (619) 239-9034
	 	Email: tad@mailander@mailanderlaw.net

 

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 3 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.

 

Section 12. Date.
The date of this Warrant is set forth on page 1 hereof. This Warrant, in all events, shall be wholly void and of no effect
after the close of business on the Expiration Date, except that notwithstanding any other provisions hereof, the provisions of
Section 3(d) shall continue in full force and effect after such date as to any Warrant Shares or other securities issued upon
the exercise of this Warrant.

 

Section 13. Amendment
and Waiver. Except as otherwise provided herein, the provisions of the Warrant may be amended and the Company may take any
action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained the
written consent of the holders of Warrants representing at least 2/3rds of the Warrant Shares issuable upon exercise of the Warrants
then outstanding; provided that, except for Section 8(c), no such action may increase the Warrant Exercise Price or decrease the
number of shares or class of stock obtainable upon exercise of any Warrant without the written consent of the holder of such Warrant.

 

Section 14. Assignment. This
Warrant may be assigned by the Holder only if such assignment is made in compliance with all applicable laws, including federal
and state securities laws. In connection with any permitted transfer, the transferee shall make such representation and warranties
to the Company, consistent with Section 6 hereof, s the Company may reasonably request.

 

    14

     

    

 

Section 15. Descriptive
Headings; Governing Law. The descriptive headings of the several sections and paragraphs of this Warrant are inserted for
convenience only and do not constitute a part of this Warrant. The corporate laws of the State of New Jersey shall govern all
issues concerning the relative rights of the Company and its stockholders. All other questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New Jersey,
without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New Jersey or any
other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New Jersey.
Each party hereby irrevocably submits to the exclusive jurisdiction of the Superior Court of the state courts sitting in
Union County New Jersey and the Federal District Court for the District of New Jersey sitting in Newark, New Jersey, for the
adjudication of any dispute hereunder or in connection herewith or therewith, or with any transaction contemplated hereby or
discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that
it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address for such notices to it under this Agreement 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 manner permitted by law.

 

Section 16. Remedies,
Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Warrant shall be cumulative and in addition
to all other remedies available under this Warrant, in any other agreement between the Company and the Holder, at law or in equity
(including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit the right of the Holder
to pursue actual damages for any failure by the Company to comply with the terms of this Warrant. The Company acknowledges that
a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy at law for any such breach
may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the holder of this
Warrant shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity
of showing economic loss and without any bond or other security being required.

 

 

Section 17. Waiver
of Jury Trial. AS A MATERIAL INDUCEMENT FOR EACH PARTY HERETO TO ENTER INTO THIS WARRANT, THE PARTIES HERETO HEREBY WAIVE
ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS WARRANT AND/OR ANY AND ALL OF THE TRANSACTION DOCUMENTS
ASSOCIATED WITH THIS TRANSACTION.

 

REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK

 

    15

     

    

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to be signed as of the date first set forth above.

 

	 	ELECTROMEDICAL TECHNOLOGIES, INC.
	 	 
	 	By:	                              
	 	Name: 
	 	Title: 

 

    16

     

    

 

EXHIBIT A TO WARRANT

 

EXERCISE NOTICE

 

TO BE EXECUTED

BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT

 

ELECTROMEDICAL TECHNOLOGIES, INC.

 

The undersigned holder
hereby exercises the right to purchase ______________ of the shares of Common Stock (“Warrant Shares”) of ELECTROMEDICAL
TECHNOLOGIES, INC. (the “Company”), evidenced by the attached Warrant (the “Warrant”). Capitalized
terms used herein and not otherwise defined shall have the respective meanings set forth in the Warrant.

 

Specify Method of exercise
by check mark:

 

1. ___ Cash Exercise

 

(a) Payment
of Warrant Exercise Price. The holder shall pay the Aggregate Exercise Price of $______________ to the Company in accordance
with the terms of the Warrant.

 

(b) Delivery
of Warrant Shares. The Company shall deliver to the holder _________ Warrant Shares in accordance with the terms of the Warrant.

 

 2. ___ Cashless
Exercise

 

(a) Payment
of Warrant Exercise Price. In lieu of making payment of the Aggregate Exercise Price, if permitted by the terms of the Warrant,
the holder elects to receive upon such exercise the Net Number of shares of Common Stock determined in accordance with the terms
of the Warrant.

 

(b) Delivery
of Warrant Shares. The Company shall deliver to the holder _________ Warrant Shares in accordance with the terms of the Warrant.

 

Date: _______________ __, ______

 

Name of Registered Holder

 

	By:	 	 

	Name:	 	 

	Title:	 	 

 

Address:

Taxpayer ID No.:

 

     

     

    

 

EXHIBIT B TO WARRANT

 

FORM OF WARRANT POWER

 

FOR VALUE RECEIVED,
the undersigned does hereby assign and transfer to ________________, Federal Identification No. __________, a warrant to purchase
____________ shares of the capital stock of ELECTROMEDICAL TECHNOLOGIES, INC. represented by warrant certificate no. _____,
standing in the name of the undersigned on the books of said corporation. The undersigned does hereby irrevocably constitute and
appoint ______________, attorney to transfer the warrant of said corporation, with full power of substitution in the premises.

 

	Dated:	 	 	  

 

	 	By:	 

	 	Name:	 

	 	Title:	 

 

    B-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00321-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00321-of-00352.parquet"}]]