Document:

Code Green Apparel Corp. 8-K

Exhibit 10.1

 

NOTE
PURCHASE AGREEMENT

 

This
note purchase agreement (“Agreement”) is made and entered into this 12th day of April 2017 by and between Code
Green Apparel Corp, a Nevada corporation (“CGAC” or the “Company”) and Sojourn Investments, LP, a Texas
Limited Partnership (“Investor”) (CGAC and Investor jointly, the “Parties”).

 

WITNESSETH:

 

NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the parties to
this Agreement, said parties agree as follows:

 

		(a)	CGAC
                                         agrees to sell to Investor the note (“Note” or “Debenture”) issued
                                         by the Company with terms as fully represented in Exhibit 1 hereto with a face value
                                         in the amount of $ 32,500 (“Original Principal Balance”). The
                                         Original Principal Balance consists of cash proceeds of $27,500 (“Note Proceeds”).

		(b)	Investor
                                         agrees to purchase the Debenture from CGAC.

		(c)	Pursuant
                                         to this Agreement, the Parties agree as follows:

		1.	Step
                                         1: Both Parties will execute this Agreement;

		2.	Step
                                         2: Upon receipt of a fully executed Agreement CGAC will execute the Debenture, marked
                                         Exhibit 1 hereto, along with Exhibits 1A, 1B, and 1D, and deliver originals thereof to
                                         the Investor.

		3.	Step
                                         3: Within 48 hours of the completion of Step 2 above, Investor shall wire the Note Proceeds
                                         in full to CGAC as follows:

 

	Amount:	$27,500
	Bank:	Wells Fargo Bank
	 	27702 Crown Valley Pkwy D1
	 	Ladera Ranch, CA 92694
	 	 
	Account Name:	Code Green Apparel Corp
	Account #:	##########
	ABA #:	##########

  

This
Agreement is null and void unless Step 3 is completed.

 

(1)  Representations
and Warranties. The Parties to this Agreement, and their agents represent and warrant they are entering into this Agreement
and the performance by them, and their agents hereunder will not conflict with, violate or constitute a breach of, or require
any consent or approval under any agreement, license, arrangement or understanding, or any law, judgment, decree, order, rule
or regulation to which they and their agents are a party or by which it is bound.

 

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The
signatories and parties to this Agreement warrant that they are authorized to enter into this Agreement and is binding upon the
Parties hereto. All entities which are parties to this Agreement warrant that they are in good standing and current with their
states or locations of domicile and that their entering into this Agreement will not violate or breach any other binding agreement
of the Parties.

 

(2)  Severability.
If any provision of this Agreement is invalid and unenforceable in any jurisdiction, then to the fullest extent permitted
by law: (1) the other provisions hereof shall remain in full force and effect in such jurisdiction; and (2) the invalidity or
unenforceability of any provision hereof in any jurisdiction shall not affect the validity or unenforceability of such provision
in any other jurisdiction.

 

(3)  Entire
Agreement. This Agreement contains the entire understanding and agreement between the Parties with respect to the subject
matter hereof and cannot be amended, modified or supplemented in any respect except by a subsequent written agreement entered
into by the Parties.

 

(4)  Successors.
This Agreement may not be assigned. Subject to the foregoing, in every respect, this Agreement shall inure to the benefit
of and be binding upon the parties and their successors.

 

(5)  Effect
of Waiver. The waiver by either Party of a breach of any provision of this Agreement shall not operate as, or be construed
as, a waiver of any subsequent breach.

 

(6)  Notices.
Any notice, request, demand or other communication in connection with this Agreement shall be (i) in writing, (ii) delivered
by personal delivery, or sent by commercial delivery service or certified mail, return receipt requested or sent by facsimile,
(iii) deemed to have been given on the date of personal delivery or the date set forth in the records of the delivery service
or on the return receipt or, in the case of a facsimile, upon confirmed transmission thereof and (iv) addressed as follows:

 

	ARTICLE I.INVESTOR:	COMPANY:
	Sojourn Investments, LP	Code Green Apparel Corp
	3411 Preston Road	31642 South Coast Highway
	Suite C13-230	Suite 102
	Frisco, TX 75034	Laguna Beach, CA 92651

 

or
to any such other or additional persons and addresses as the parties may from time to time designate in writing delivered in accordance
with this Section.

 

(7)  Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together
shall constitute one and the same instrument.

 

(8)  Applicable
Law. This Agreement shall be governed by, and construed in accordance with the laws of the State of Texas. In the event any
action be instituted by a party to

     

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enforce
any of the terms and provisions contained herein, the prevailing party in such action shall entitled to such reasonable attorneys’
fees, costs and expenses as may be fixed by the Court.

 

(9)  Ownership
Limitation. Notwithstanding anything to the contrary herein contained, the Investor may not convert the Debenture to the extent
such conversion would result in the Investor, together with any affiliate thereof, beneficially owning (as determined in accordance
with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules promulgated
thereunder) in excess of 4.99% of the then issued and outstanding shares of the Company’s common stock, including shares
issuable upon such conversion and held by the Investor after application of this section. The provisions of this section may be
waived by the Investor (but only as to itself and not to any other holder) upon not less than 61 days prior notice to the Company.
Other investors shall be unaffected by any such waiver.

 

(10)  Attorneys’
Fees. In the event of any action at law or in equity to enforce or interpret the terms of this Agreement, the parties agree
that the party who is awarded the most money shall be deemed the prevailing party for all purposes and shall therefore be entitled
to an additional award of the full amount of the attorneys’ fees and expenses paid by such prevailing party in connection
with the litigation and/or dispute without reduction or apportionment based upon the individual claims or defenses giving rise
to the fees and expenses. Nothing herein shall restrict or impair a court’s power to award fees and expenses for frivolous
or bad faith pleading.

 

IN
WITNESS WHEREOF, the parties have executed this Agreement as the day and year first stated above.

	 	 	 	 	 
	Code
    Green Apparel Corp	 	Sojourn
    Investments, LP
	 	 	 
	By:	 	 	By:	 
	George
    J. Powell III, CEO	 	Casey
    Jensen, CEO of its General
	 	 	Partner,
    SJI Management By:__

 

     3Code Green Apparel Corp. 8-K

Exhibit 10.2 

 

NEITHER
THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE 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 AS EVIDENCED BY A
LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
THESE SECURITIES AND THE SECURITIES ISSUABLE UPON CONVERSION OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

Date
of Issuance: April 12, 2017

 

	10%
    CONVERTIBLE DEBENTURE	Principal
    Amount: $32,500
	DUE
    January 12, 2017	Purchase
    Amount: $27,500

 

THIS
DEBENTURE is a duly authorized and issued 10% Convertible Debentures of CODE GREEN APPAREL CORP (the “Company”), a
Nevada corporation, due January 12, 2017 (the “Debenture”).

 

FOR
VALUE RECEIVED, the Company promises to pay to Sojourn Investments, LP, a Texas Limited Partnership or its registered assigns
(the “Holder”) (Company and Holder jointly, the “Parties”), the initial principal sum of $32,500 on the
date which is twelve months from the date of this Debenture, or such earlier date as the Debentures are required or permitted
to be repaid as provided hereunder (the “Maturity Date”), and to pay interest to the Holder on the aggregate unconverted
and then Outstanding Balance (defined below) of this Debenture at the rate of 10% per annum, payable on the Maturity Date. “Outstanding
Balance” means the initial principal sum, as reduced or increased, as the case may be, pursuant to the terms hereof for
conversion or otherwise, plus any accrued but unpaid interest and any other fees or charges incurred under this Debenture.

 

THE
COMPANY MAY PREPAY ANY PORTION OF THE PRINCIPAL AMOUNT OF THIS DEBENTURE WITHOUT PENALTY FOR A PERIOD OF THIRTY (30) DAYS FROM
THE DATE OF THIS DEBENTURE (THE “PREPAYMENT PERIOD”). BEYOND THE PREPAYMENT PERIOD, THE COMPANY MAY PREPAY ANY PORTION
OF THE PRINCIPAL AMOUNT AT 125% OF SUCH AMOUNT ALONG WITH ANY ACCRUED INTEREST.

 

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This
Debenture is subject to the following additional provisions:

 

Section
1. DENOMINATIONS. This Debenture is exchangeable for an equal aggregate principal amount of Debentures of different authorized
denominations, as requested by the Holder surrendering the same. No service charge will be made for such registration of transfer
or exchange.

 

Section
2. TRANSFER. This Debenture may be transferred or exchanged only in compliance with applicable federal and state securities laws
and regulations. Prior to due presentment to the Company for transfer of this Debenture, the Company and any agent of the Company
may treat the Person in whose name this Debenture is duly registered on the Debenture Register as the owner hereof for the purpose
of receiving payment as herein provided and for all other purposes, whether or not this Debenture is overdue, and neither the
Company nor any such agent shall be affected by notice to the contrary.

 

Section
3. EVENTS OF DEFAULT.

 

(a)          “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)         any
default in the payment of the principal or interest (including Late Fees) on, or liquidated damages in respect to this Debenture,
as and when the same shall become due and payable (whether on a Conversion Date or the Maturity Date or by acceleration or otherwise)
which default is not cured, if possible to cure, within 7 Business Days of notice of such default sent by the Holder;

 

(ii)        the
Company or any of its subsidiaries shall commence, or there shall be commenced against the Company or any such subsidiary a case
under any applicable bankruptcy or insolvency laws as now or hereafter in effect or any successor thereto, or the Company commences
any other court 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
thereof or there is commenced against the Company or any subsidiary thereof any such bankruptcy, insolvency or other court proceeding
which remains undismissed for a period of 90 days; or the Company or any subsidiary thereof 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 thereof
suffers any appointment of any custodian or the like for it or any substantial part of its property which continues undischarged
or unstayed for a period of 90 days; or the Company or any subsidiary thereof makes a general assignment for the benefit of creditors;
or 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 thereof shall call a meeting of its creditors with a view to arranging a composition,
adjustment or

 

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restructuring
of its debts; or the Company or any subsidiary thereof 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 thereof
for the purpose of effecting any of the foregoing; or

 

(iii)       the
Company shall fail to timely file all reports required to be filed by it with the SEC pursuant to Section 13 or 15(d) of the Securities
and Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise required by the Exchange Act, and which failure
to file is not cured within 14 Business Days.

 

(iv)       the
material breach of any promise, covenant, obligation or representation in this Debenture and/or related representation or agreement
made by the COMPANY and or any of its officers.

 

(v)        the
failure to cause to be delivered (including a failure to issue a treasury order to its transfer agent) the Conversion Shares of
common stock due HOLDER on a conversion within three Business Days from the date of conversion or sooner, which delivery must
be otherwise made per reasonable specifications of the HOLDER (e.g. to brokerage firm account).

 

If
the COMPANY fails to perform hereunder by causing to be delivered or by issuing a treasury order to its transfer agent for the
Conversion Shares or paying principal and or interest within 3 Business Days of said being due, then for the first up to 30 calendar
days from the due date of said performance, the COMPANY shall also owe payable immediately an amount equal to $1,000 per day as
a reasonable “Late Fee” in addition to any other damages and reasonable attorney fees and costs payable, to cover,
on a non accountable basis, the time, expense, efforts and or distress of the HOLDER having to focus its management, advisors,
and counselors on the matter of the COMPANY failing to honor its written obligations, and said figure is deemed a reasonable liquidated
damages provision and is not an election of remedy and is non exclusive so the HOLDER can add and pursue all rights otherwise.

 

(b)          If
any Event of Default occurs and is continuing, the Outstanding Balance shall become at the Holder’s election, immediately
due and payable in cash. The Holder need not provide and the Company hereby waives any presentment, demand, protest or other notice
of any kind, 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 and the Holder shall have all rights as a Debenture holder until such time, if any, as
the full payment under this Section shall have been received by it. No such rescission or annulment shall affect any subsequent
Event of Default or impair any right consequent thereon.

 

(c)          Upon
the occurrence of an Event of Default, (i) interest shall accrue on the Outstanding Balance both before and after judgment at
the rate of eighteen percent (18%) per annum; and (ii) the Outstanding Balance shall automatically increase to an amount

 

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equal
to the Outstanding Balance immediately prior to such Event of Default multiplied by 125%, all without the need for any further
notice to or action by any party hereunder; provided, however, that such increase may only be applied with respect to two Events
of Default under this Note, and not to any additional Events of Default.

 

Section
4. Conversion.

 

(a) (i)
Holder’s Conversion Right. At any time after the Original Issue Date until this Debenture is no longer outstanding, this
Debenture, including interest and principal, shall be convertible into shares (“Conversion Shares”) of Common Stock
at a discount of forty two percent (42%) off the average of the lowest three (3) closing prices during the prior 20 trading days,
determined on the then current trading market for the Company’s common stock, for 20 trading days prior to conversion (the
“Set Price”) at the option of the Holder, in whole or in part at any time and from time to time. The Holder shall
effect conversions by delivering to the Company the form of Notice of Conversion attached hereto as Exhibit 1C (a “Notice
of Conversion”), specifying the date on which such conversion is to be effected (a “Conversion Date”). If no
Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion is
provided hereunder. To effect conversions hereunder, the Holder shall not be required to physically surrender the Debentures to
the Company. In the event of any dispute or discrepancy, the records of the Holder shall be reasonably controlling and determinative
in the absence of manifest error. If the Conversion Shares are not delivered to Holder within THREE (3) Business Days, the Company
shall be responsible for any differential in the value of the converted shares underlying this Debenture between the value of
the closing price on the date the shares should have been delivered and the date the shares are delivered. In addition, if the
COMPANY fails to timely (within 72 hours, 3 Business Days), issue a treasury order to its transfer agent or otherwise cause to
be delivered, the Conversion Shares per the instructions of the HOLDER, free and clear of all legends in legal free trading form,
subject to all applicable securities laws, the COMPANY shall allow HOLDER, among other remedies, to add two (2) days to the look-back
(the mechanism used to obtain the conversion price along with discount) for each day the COMPANY fails to timely (within 72 hours,
3 Business Days)) deliver shares, on the next conversion.

 

(ii)        If
the Company, at any time while this Debenture is outstanding: (A) shall 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 (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company pursuant to this Debenture,
including as interest thereon), (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 Set 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

 

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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.

 

(iii)       Whenever
the Set Price is adjusted pursuant to any of Section 4, the Company shall promptly mail to each Holder a notice setting forth
the Set Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment.

 

(iv)       If
(A) the Company shall declare a dividend (or any other distribution) on the Common Stock; (B) the Company shall declare a special
nonrecurring cash dividend on or a redemption of the Common Stock; (C) the Company shall authorize the granting to all holders
of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights;
(D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock,
any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of
the Company, of any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property; (E)
the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company;
then, in each case, the Company shall cause to be filed at each office or agency maintained for the purpose of conversion of the
Debentures, and shall cause to be mailed to the Holders at their last addresses as they shall appear upon the stock books of the
Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if
a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the
Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable
upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided, that the failure to mail such notice
or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified
in such notice. Holders are entitled to convert Debentures during the 20-day period commencing the date of such notice to the
effective date of the event triggering such notice.

 

(v)        If,
at any time while this Debenture is outstanding, (A) the Company effects any merger or consolidation of the Company with or into
another Person, (B) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions,
(C) any tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common
Stock are permitted to tender or exchange their shares for other securities, cash or property, or (D) the Company effects any
reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property (in any such case, a “Fundamental

 

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Transaction”),
then upon any subsequent conversion of this Debenture, the Holder shall have the right to receive, for each Underlying Share that
would have been issuable upon such conversion absent such Fundamental Transaction, the same kind and amount of securities, cash
or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately
prior to such Fundamental Transaction, the holder of one share of Common Stock (the “Alternate Consideration”). For
purposes of any such conversion, the determination of the Set Price shall be appropriately adjusted to apply to such Alternate
Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental
Transaction, and the Company shall apportion the Set Price among the Alternate Consideration in a reasonable manner reflecting
the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice
as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice
as to the Alternate consideration it receives upon any conversion of this Debenture following such Fundamental Transaction. To
the extent necessary to effectuate the foregoing provisions, any successor to the Company or surviving entity in such Fundamental
Transaction shall issue to the Holder a new debenture consistent with the foregoing provisions and evidencing the Holder’s
right to convert such debenture into Alternate Consideration. The terms of any agreement pursuant to which a Fundamental Transaction
is effected shall include terms requiring any such successor or surviving entity to comply with the provisions of this paragraph
and insuring that this Debenture (or any such replacement security) will be similarly adjusted upon any subsequent transaction
analogous to a Fundamental Transaction. Notwithstanding anything herein to the contrary, the Company Agrees not to close or complete
a Fundamental Transaction unless (i) Holder has consented in writing to such Fundamental Transaction, or (ii) the Company has
paid to Holder the entire Outstanding Balance of this Note. If any Fundamental Transaction constitutes or results in a Change
of Control Transaction, then at the request of the Holder delivered before the 90th day after such Fundamental Transaction, the
Company (or any such successor or surviving entity) will purchase the Debenture from the Holder for a purchase price, payable
in cash within 10 Business Days after such request (or, if later, on the effective date of the Fundamental Transaction), equal
to the 125% of the remaining unconverted principal amount of this Debenture on the date of such request, plus all accrued and
unpaid interest thereon, plus all other accrued and unpaid amounts due hereunder.

 

(b)          The
Company covenants that it will at all times reserve and keep available out of its authorized and unissued shares of Common Stock
a sufficient number of shares solely for the purpose of issuance to Holder upon conversion of this Debenture.

 

(c)          Any
and all notices or other communications or deliveries to be provided by the Holders hereunder, including, without limitation,
any Notice of Conversion, shall be in writing and delivered personally, by facsimile, sent by a nationally recognized overnight
courier service, addressed to the Company, at the address set forth or such other address or facsimile number as the Company may
specify for such purposes by notice to the Holders delivered in accordance with this Section. Any and all notices or

 

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other
communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile,
sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile telephone number or address
of such Holder appearing on the books of the Company, or if no such facsimile telephone number or address appears, at the principal
place of business of the Holder. Any notice or other communication or deliveries hereunder shall be deemed given and effective
on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile telephone
number specified in this Section prior to 5:30 p.m. (New York City time), (ii) the date after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile telephone number specified in this Section later than 5:30
p.m. (New York City time) on any date and earlier than 11:59 p.m. (New York City time) on such date, (iii) the second Business
Day following the date of mailing, if sent by nationally recognized overnight courier service, or (iv) upon actual receipt by
the party to whom such notice is required to be given.

 

(d)          Notwithstanding
anything to the contrary herein contained, the Holder may not convert this Debenture to the extent such conversion would result
in the Holder, together with any affiliate thereof, beneficially owning (as determined in accordance with Section 13(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules promulgated thereunder) in excess of
4.99% of the then issued and outstanding shares of Common Stock, including shares issuable upon such conversion and held by the
Holder after application of this section. The provisions of this section may be waived by the Holder (but only as to itself and
not to any other Holder) upon not less than 61 days prior notice to the Company. No conversion shall be effected if such conversion
shall result in derivative accounting treatment for the Company. Other Holders shall be unaffected by any such waiver.

 

Section
5. Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Debenture: (a) capitalized terms not
otherwise defined herein have the meanings given to such terms in the Note Purchase Agreement between the Company and the Holder
of even date herewith, and (b) the following terms shall have the following meanings:

 

“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 in the State of New York are authorized or required by law or other government action to close.

 

“Common
Stock” means the common stock of the Company and stock of any other class into which such shares may hereafter have been
reclassified or changed, which stock is duly authorized and validly issued and fully paid and non-assessable.

 

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

 

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

 

“Set
Price” shall have the meaning set forth in Section 4.

 

Section
6. Except as expressly provided herein, no provision of this Debenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of, interest and liquidated damages (if any) on, this Debenture at the time,
place, and rate, and in the coin or currency, herein prescribed. This Debenture is a direct debt obligation of the Company.

 

Section
7. If this Debenture shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution
for and upon cancellation of a mutilated Debenture, or in lieu of or in substitution for a lost, stolen or destroyed Debenture,
a new Debenture for the Outstanding Balance of this Debenture so mutilated, lost, stolen or destroyed but only upon receipt of
evidence of such loss, theft or destruction of such Debenture, and of the ownership hereof, and indemnity, if requested, all reasonably
satisfactory to the Company. Holder shall pay for any insurance or bond that may be required in such instance, if at all.

 

Section
8. [Intentionally left blank].

 

Section
9. [Intentionally left blank].

 

Section
10. All questions concerning the construction, validity, enforcement and interpretation of this Debenture shall be governed by
and construed and enforced in accordance with the internal laws of the State of Texas, without regard to the principles of conflicts
of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions
contemplated by any of the Transaction Documents (whether brought against a party hereto or its respective affiliates, directors,
officers, shareholders, employees or agents) shall be commenced in the state and federal courts sitting in Dallas County (the
“Texas Courts”). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the Texas Courts for
the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of any of the Transaction Documents), 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,
or such Texas Courts are improper or inconvenient venue for such proceeding. 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 via registered
or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under
this Debenture 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. Each party hereto
hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal

 

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proceeding
arising out of or relating to this Debenture or the transactions contemplated hereby. If either party shall commence an action
or proceeding to enforce any provisions of this Debenture, then the prevailing party in such action or proceeding shall be reimbursed
by the other party for its attorneys fees and other costs and expenses incurred with the investigation, preparation and prosecution
of such action or proceeding.

 

Section
11. Any waiver by the Company or 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 Company or 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.

 

Section
12. 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 violates 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 the Debentures 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.

 

Section
13. 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. Time is of the essence for all obligations arising hereunder.

 

Section
14. In the event of any action at law or in equity to enforce or interpret the terms of this Debenture, the parties agree that
the party who is awarded the most money shall be deemed the prevailing party for all purposes and shall therefore be entitled
to an additional award of the full amount of the attorneys’ fees and expenses paid by such prevailing party in connection
with the litigation and/or dispute without reduction or apportionment based upon the individual claims or defenses giving rise
to the fees and expenses. Nothing herein shall restrict or impair a court’s power to award fees and expenses for frivolous
or bad faith pleading.

 

     9

     

    

 

IN
WITNESS WHEREOF, the Parties have caused this Convertible Debenture to be duly executed by a duly authorized officer as of the
date first above indicated.

	 	 	 
	 	COMPANY:
	 	 
	 	CODE
    GREEN APPAREL CORP
	 	 
	 	By:	 
	 	Name:
    George J. Powell, III
	 	Title:
    CEO
	 	 
	 	HOLDER:
	 	 
	 	SOJOURN
    INVESTMENTS, LP
	 	 
	 	By:	 
	 	Casey
    Jensen, CEO of its General Partner,
	 	SJI
    Management

 

     10

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