Document:

Exhibit 10.1

 

FORBEARANCE
AND FOURTH AMENDMENT AGREEMENT

 

This
Forbearance and Fourth Amendment Agreement (this “Amendment Agreement”), effective as of July 2, 2018, by and
among uSell.com, Inc., a Delaware corporation (“USELL”), BST Distribution, Inc., a New York corporation (“BST”),
We Sell Cellular LLC, a Delaware limited liability company (“WE SELL” together with uSell and BST, each a “Company”
and collectively the “Companies”), the Purchaser party hereto (the “Purchaser”) and
______________________, a Delaware limited liability company, as agent for the Purchaser and the other Purchasers from time to
time party to the Note Purchase Agreement (as hereafter defined) (the “Agent” and together with such Purchasers,
the “Creditor Parties”).

 

WHEREAS,
the Companies and Creditor Parties are parties to a Note Purchase Agreement dated as of January 13, 2017 (as amended from time
to time, the “Purchase Agreement”).

 

WHEREAS,
an Event of Default (as defined in the Note) occurred on April 1, 2018 and is now existing based on Companies’ failure to
comply with the “Operating Margin” covenant set forth in Section 8.23(a) of the Purchase Agreement for the fiscal
quarter period ending March 31, 2018 (the “Designated Default”).

 

WHEREAS,
pursuant to the terms of a Forbearance and Third Amendment Agreement dated as of May 4, 2018 by and among Company and Creditor
Parties, Creditor Parties agreed to forbear for a period of time from exercising rights and remedies based on the occurrence of
the Designated Default and amend certain provisions of the Purchase Agreement (the “May 4th Forbearance and Amendment
Agreement”).

 

WHEREAS,
Companies have requested that Creditor Parties (a) extend the Forbearance Period provided for and as defined in the May 4th Forbearance
and Amendment Agreement and (b) amend the Purchase Agreement and the Related Agreements on the terms and subject to the conditions
set forth herein, and Creditor Parties are prepared to extend such Forbearance Period and amend the Purchase Agreement, in each
case, on the terms and conditions set forth below.

 

NOW,
THEREFORE, in consideration of the foregoing, and of other good and valuable consideration, the receipt and adequacy of which
is hereby acknowledged, the parties hereto agree as follows:

 

1.       Capitalized
Terms. Capitalized terms not otherwise defined in this Amendment Agreement shall have the meaning ascribed to them in the
Purchase Agreement.

 

2.       Acknowledgment
of Liabilities.

 

(a)       Each
Company hereby acknowledges that it is unconditionally liable to Creditor Parties under the Purchase Agreement and the Related
Agreements to which it is a party for the payment of all Liabilities, and no Company has any defenses, counterclaims, deductions,
credits, claims or rights of setoff or recoupment with respect to the Liabilities.

 

     

     

    

 

(b)       Each
Company hereby ratifies and confirms its obligations under the Purchase Agreement and the Related Agreements to which it is a
party and hereby acknowledges and agrees that the Purchase Agreement and the Related Agreements to which it is a party remain
in full force and effect.

 

3.         Forbearance.

 

(a)       Each
Company hereby acknowledges that (a) the Designated Default occurred on April 1, 2018 and is continuing and (b) the Forbearance
Period provided for and as defined in the May 4th Forbearance and Amendment Agreement terminated on June 30, 2018, the occurrence
of which entitles the Creditor Parties to exercise their rights and remedies under the Purchase Agreement, the Related Agreements
and applicable law.

 

(b)       No
Creditor Party has waived, presently does not intend to waive and may never waive such Designated Default and nothing contained
herein or the transactions contemplated hereby shall be deemed to constitute in any manner whatsoever any such waiver. Each Company
hereby acknowledges that Creditor Parties have the presently exercisable right to declare the Liabilities to be immediately due
and payable under the Willis of the Purchase Agreement and the Related Agreements.

 

(c)       Subject
to satisfaction of the conditions of effectiveness set forth in Section 8 of this Amendment Agreement, during the period (the
“Forbearance Period”) commencing on June 30, 2018 and ending on the earlier to occur of (a) September 30, 2018
and (b) the occurrence of any Forbearance Default (as defined in Section 3(e) of this Amendment Agreement), Creditor Parties will
forbear from exercising their rights and remedies under the Purchase Agreement, the Related Agreements and applicable law solely
in respect of the Designated Default. Notwithstanding the foregoing, nothing contained herein shall impair in any manner whatsoever
Creditor Parties’ rights to administer the credit facility and/or to collect, receive and/or apply proceeds of each Company’s
accounts receivable and/or any other collateral to the Liabilities, in each case, in accordance with the terms of the Purchase
Agreement and the Related Agreements. The Creditor Parties may consider extending the expiration date of the Forbearance Period,
but any such extension will be determined by the Creditor Parties in their sole and absolute discretion and, if provided at all,
shall only be made on terms and conditions satisfactory to the Creditor Parties in their sole and absolute discretion. Among other
factors which the Creditor Parties may consider in determining whether to extend the expiration date of the Forbearance Period
are the Companies’ financial performance, the Companies’ compliance with the June 30, 2018 and September 30, 2018
“Operating Margin” financial covenants under Section 8.23(a), the occurrence of no Events of Default (other than the
Designated Default) and the Creditor Parties’ receipt of evidence satisfactory in all respects to the Creditor Parties demonstrating
that satisfactory progress (as determined by the Creditor Parties in their sole and absolute discretion) has been made by the
Companies in connection with their diligent and good faith efforts to refinance the Liabilities by September 30, 2018. No such
extension, if provided at all, shall be effective unless in a writing executed by the Creditor Parties and the Companies, and
acknowledged and agreed to by the Guarantors.

 

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(d)       Upon
the termination of the Forbearance Period, the agreement of Creditor Parties to forbear with respect to the Designated Default
shall automatically and without further action terminate and be of no further force and effect, it being expressly agreed that
the effect of such termination will be to permit Creditor Parties to (i) exercise such rights and remedies immediately without
any further notice, passage of time or forbearance of any kind and (ii) charge the Default Interest Rate (as defined in Section
1.7 of the Note) retroactively to April 1, 2018, which such Default Interest Rate charges shall be due and payable on the next
Interest Payment Date (as defined in the Note).

 

(e)       The
occurrence of any Event of Default (other than the Designated Default) shall constitute a Forbearance Default. As of the date
hereof, neither the Companies nor the Creditor Parties have any actual knowledge of any Events of Default other than the Designated
Default.

 

(f)       Subject
only to Section 3(c) of this Amendment Agreement, Creditor Parties reserve the right, in their sole discretion, to exercise any
or all of their rights and remedies under the Purchase Agreement, the Related Agreements and applicable law as a result of any
Event of Default (other than the Designated Default), and no Creditor Party has waived any of such rights or remedies, and nothing
in this Amendment Agreement, and no delay on their part in exercising any such rights or remedies, should be construed as a waiver
of any such rights or remedies.

 

4.           Amendments.
Subject to satisfaction of the conditions of effectiveness set forth in Section 8 of this Amendment Agreement:

 

(a)         Section
8.23(a) of the Agreement is hereby amended and restated in its entirety to provide as follows:

 

“(a)
Operating Margin.

 

(i)        Commencing
with the fiscal quarter ending December 31, 2017 and for each fiscal quarter ending thereafter, Companies will not permit Gross
Profit (as hereafter defined) as of the end of such fiscal quarter to be less than two percent (2%) of Companies’ revenue
(determined in accordance with GAAP) for such fiscal quarter.

 

(ii)       For
the calendar months ending July 31, 2018, August 31, 2018 and September 30, 2018, Companies will not permit Gross Profit (as hereafter
defined) as of the end of such calendar month to be less than zero percent (0%) of Companies’ revenue (determined in accordance
with GAAP) for such calendar month.

 

For
purposes hereof, the term “Gross Profit” shall mean an amount equal to (x) revenue received by Companies during
the applicable period, minus (y) the cost of goods sold during the applicable period, including all direct sales and marketing
expenses incurred by Companies during such period, all to be determined in accordance with GAAP and in a manner consistent with
Companies’ past practices and otherwise supported by calculations acceptable to Agent.”

 

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(b)       The
definition of “Applicable Net Debt” set forth in Section 8.23(b) of the Purchase Agreement is hereby amended and restated
in its entirety to provide as follows:

 

“Applicable
Net Debt” means, at the date of determination, the outstanding principal amount of the Notes less (X) cash and
cash equivalents on deposit in the Agent Controlled Account plus (Y) (i) during the period commencing on and including
July 2, 2018 and ending on and including September 30, 2018, zero ($0) and (ii) on and after October 1, 2018, $230,000, minus
(Z) during the period commencing on and including July 2, 2018 and ending on and including September 30, 2018, the sum of
(1) $187,600 and (2) all PIK Amounts (as defined in the Note) which have been added to the Principal Amount of (and as defined
in) the Note on or prior to such date of determination.”

 

(c)       Notwithstanding
anything contained in the Purchase Agreement or any Related Agreement to the contrary, so long as (a) no Event of Default (other
than the Designated Default) shall occur and be continuing and (b) all Liabilities are paid in full in cash prior to the expiration
of the Forbearance Period, the occurrence of the Designated Default shall not result in the imposition of the Default Interest
Rate (as defined in the Note); provided that in the event all Liabilities are not paid in full prior to the expiration of the
Forbearance Period and in the event (i) the Companies fail to be in compliance with the “Operating Margin” covenant
under Section 8.23(a) of the Purchase Agreement for both the fiscal quarter ending June 30, 2018 and the fiscal quarter ending
September 30, 2018 or (ii) fail to provide Creditor Parties evidence satisfactory in all respects to the Creditor Parties demonstrating
that satisfactory progress (as determined by the Creditor Parties in their sole and absolute discretion) has been made by the
Companies in connection with their diligent and good faith efforts to refinance the Liabilities by September 30, 2018, then all
Liabilities shall automatically bear interest at the Default Interest Rate (as defined in the Note) on a retroactive basis from
the date of the first occurrence of the Designated Default.

 

(d)       The
Note is hereby amended to reflect the terms of the Third Amended and Restated Secured Term Note in the form attached hereto as
Exhibit A. 

 

5.       Forbearance
and Amendment Fee; Companies’ Deferral of Certain Payments. (a) In consideration of Creditor Parties’ agreements
contained herein, the Companies shall jointly and severally pay to Purchaser a forbearance and amendment fee in an aggregate amount
equal to $187,600 (the “Amendment Fee”), which such Amendment Fee shall be payable simultaneously with Company’s
execution and delivery of this Amendment Agreement by the addition of the amount of such Amendment Fee to the Principal Amount
owing under and as defined in the Note such that immediately after giving effect to such payment (but prior to the addition of
any PIK Amount) the outstanding Principal Amount of the Note shall equal Five Million Five Hundred Forty-Seven Thousand Six Hundred
Dollars ($5,547,600).

 

(b)
Each Company agrees that, during the period commencing on July 2, 2018 and ending on October 1, 2018, it will defer payment of
any and all compensation or amounts due to Nik Raman, Scott Tepfer and the Companies’ financial consultants and legal retainer
payments to the Companies’ lawyers (collectively, the “Deferral Parties”), which amounts instead will
accrue through October 1, 2018, except that the Companies may make ordinary and customary commission
payments to Scott Tepfer for sales made by Mr. Tepfer of the Companies’ inventory in the ordinary course of business.

 

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 6.            Representations
and Warranties. Each Company hereby represents and warrants

 

to
Purchasers and Agent that:

 

(a)      The
execution, delivery and performance of this Amendment Agreement (i) have been duly authorized by each Company, (ii) are not in
contravention of the certificate of incorporation, bylaws, certificate of formation or operating agreement of any Company or of
any indenture, agreement or undertaking to which any Company is a party or by which any Company is bound and (iii) are within
each Company’s powers.

 

(b)      This
Amendment Agreement is the legal, valid and binding obligation of each Company, enforceable in accordance with its terms, except
as may be limited by applicable bankruptcy, insolvency, reorganization or similar laws relating to creditors’ rights generally
or by equitable principles.

 

(c)       The
representations and warranties of each Company contained in the Purchase Agreement and the Related Agreements are and will be
true, correct and complete in all respects on and as of the date hereof to the same extent as though made on and as of such date,
except to the extent that such representations and warranties specifically relate to an earlier date, in which case they were
true, correct and complete as of such earlier date.

 

(d)       Each
of the Deferral Parties has agreed to the deferral of the payments referenced in Section 5(b).

 

 7.            General
Release. Each Company and each Guarantor (by its acknowledgment set

 

forth
below) hereby releases, waives and forever relinquishes all claims, demands, obligations, liabilities and causes of action of
whatever kind or nature, whether known or unknown, which it has, may have, or might assert now or in the future against any Creditor
Party and/or its, officers, directors, employees, agents, attorneys, accountants, consultants, successors and assigns, directly
or indirectly, arising out of, based upon, or in any manner connected with any transaction, event, circumstance, action, failure
to act or occurrence of any sort or type, whether known or unknown, which occurred, existed, or was taken or permitted prior to
the date hereof The inclusion of this paragraph in this Amendment Agreement, and the execution of this Amendment Agreement by
Creditor Parties, does not constitute an acknowledgment or admission by any Creditor Party of liability for any matter, or a precedent
upon which any liability may be asserted.

 

 8.           Conditions
of Effectiveness. This Amendment Agreement shall become effective

 

upon
receipt by Agent (unless waived by Agent in writing) of the following, each in form and substance satisfactory to Agent in its
sole discretion: (a) this Amendment Agreement executed by each Company and each Guarantor, (b) an original executed Third Amended
and Restated Secured Term Note in the form attached hereto as Exhibit A, (c) corporate resolutions for each Company authorizing
the transactions contemplated by this Amendment Agreement and (d) payment by Companies of all fees and expenses incurred by Agent
(i) in connection with the transactions contemplated by this Amendment Agreement, including, without limitation, the fees of
________________, counsel to Agent and Purchasers and (ii) for matters described in Section 8.32 of the Purchase Agreement.

 

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9.         Effect
on Note Purchase Agreement.

 

(a)       Upon
the effectiveness of this Amendment Agreement, each reference in the Purchase Agreement to “this Agreement,” “hereunder,”
“hereof,” “herein” or words of like import shall mean and be a reference to the Purchase Agreement as
amended hereby.

 

(b)       Except
as specifically amended herein, the Agreement and all other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in full force and effect, and are hereby ratified and confirmed.

 

(c)       The
execution, delivery and effectiveness of this Amendment Agreement shall not operate as a waiver of any right, power or remedy
of Agent, nor constitute a waiver of any provision of the Purchase Agreement, or any other documents, instruments or agreements
executed and/or delivered under or in connection therewith.

 

10.       Miscellaneous.
Section 13 of the Purchase Agreement is incorporated by reference into this Amendment Agreement without the necessity of fully
repeating it.

 

[Balance
of page intentionally left blank; signature page follows]

 

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IN
WITNESS WHEREOF, the parties hereto have caused this Amendment Agreement to be duly executed and delivered by their duly authorized
officers as of the date first set forth above.

 

	 	COMPANIES:
	 	 
	 	USELL.COM, INC.
	 	 
		By: 	 
	 	 	Name:  Nikhil Raman
	 	 	Title:  Chief Executive Officer 

	 	 
	 	BST DISTRIBUTION, INC.
	 	 
		By: 	                  
	 	 	Name:  Brian Tepfer
	 	 	Title:  Chief Executive Officer 
	 	 	 

	 	WE SELL CELLULAR LLC
	 	 
		By: 	
	 	 	Name:  Nikhil Raman
	 	 	Title:  Manager

  

	SIGNATURE
    PAGE TO 

    FORBEARANCE AND FOURTH 

    AMENDMENT AGREEMENT

     

     

    

	 	 	 	 	 	 
	 	PURCHASER:	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	By:	 
	 	 	Name:	 	 
	 	 	Title:	 	 	 
	 	 	 
	 	AGENT:
	 	 	 	 	 	 
	 	 	 
	 	By:	 
	 	 	Name:	 	 
	 	 	Title:	 	 	 

  

	SIGNATURE
    PAGE TO 

    FORBEARANCE AND FOURTH 

    AMENDMENT AGREEMENT

     

     

    

 

	 	 	 
	GUARANTOR ACKNOWLEDGEMENT AND
    AGREEMENT:	 
	 	 
	UPSTREAM PHONE COMPANY USA, INC.,

    a Delaware corporation	 
	 	 	 
	By: 	 	 
	 	Name: Nikhil Raman	 
	 	Title:  President	 

	 	 	 
	UPSTREAM PHONE HOLDINGS, INC., 

    a Delaware corporation	 
	 	 	 
	By: 	 	 
	 	Name: Nikhil Raman	 
	 	Title:  President	 

	 	 	 
	HD CAPITAL HOLDINGS LLC,

    a Delaware limited liability company	 
	 	 	 
	By: 	 	 
	 	Name:  Daniel Brauser	 
	 	Title:   Manager	 

 

	SIGNATURE
    PAGE TO 

    FORBEARANCE AND FOURTH 

    AMENDMENT AGREEMENTExhibit 10.2

 

THIS
NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT. BEGINNING NO LATER THAN 10 DAYS AFTER THE ISSUE DATE OF THIS NOTE, USELL.COM,
INC., A DELAWARE CORPORATION, LOCATED AT 171 MADISON AVENUE, 17TH FLOOR, NEW YORK, NEW YORK 10016, SHALL PROMPTLY MAKE AVAILABLE
TO THE HOLDER OR HOLDERS OF THIS NOTE UPON REQUEST THE INFORMATION DESCRIBED IN TREASURY REGULATION SECTION 1.1275-3(b)(1)(i).

 

THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE MAY
NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR (B) AN OPINION OF COUNSEL, IN A GENERALLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR (II) UNLESS SOLD PURSUANT
TO RULE 144 UNDER SAID ACT.

 

THIS
NOTE IS REGISTERED WITH THE AGENT PURSUANT TO SECTION 13.5(b) OF THE PURCHASE AGREEMENT (AS DEFINED BELOW). TRANSFER OF ALL OR
ANY PORTION OF THIS NOTE IS PERMITTED SUBJECT TO THE PROVISIONS SET FORTH IN SUCH SECTION 13.5 WHICH REQUIRE, AMONG OTHER THINGS,
THAT NO TRANSFER IS EFFECTIVE UNTIL THE TRANSFEREE IS REFLECTED AS SUCH ON THE REGISTRY MAINTAINED WITH THE AGENT PURSUANT TO
SUCH SECTION 13.5(b).

 

THIRD
AMENDED AND RESTATED SECURED TERM NOTE

 

FOR
VALUE RECEIVED, each of USELL.COM, INC., a Delaware corporation (“USELL”), BST DISTRIBUTION, INC., a New York
corporation (“BST”), WE SELL CELLULAR LLC, a Delaware limited liability company (“WE SELL”, together
with USELL and BST, the “Companies” and each a “Company”), hereby promises to pay to __________________,
a Delaware limited liability company (the “Holder”) or its registered assigns or successors in interest, the
sum of FIVE MILLION FIVE HUNDRED FORTY-SEVEN THOUSAND SIX HUNDRED DOLLARS ($5,547,600), together with any accrued and unpaid interest
hereon subject to the terms and conditions set forth herein.

 

Capitalized
terms used herein without definition shall have the meanings ascribed to such terms in that certain Note Purchase Agreement, dated
as January 13, 2017 (as amended, restated, modified and/or supplemented from time to time, the “Purchase Agreement”)
among Companies, the Holder, each other Purchaser and ________________, as agent for the Purchasers (the “Agent” and together with the Purchasers (including the Holder), collectively, the “Creditor Parties”), pursuant
to which this Second Amended and Restated Secured Term Note was issued.

 

     

     

    

 

The
following term shall apply to this Third Amended and Restated Secured Term Note (this “Note”):

 

“Maturity
Date” shall mean January 13, 2020.

 

ARTICLE
I

 

CONTRACT
RATE AND AMORTIZATION

 

          1.1          Contract
Rate. Subject to Sections 1.7 and 2.9, interest payable on the outstanding principal amount of this Note (the “Principal
Amount”) shall accrue at a rate per annum equal to sixteen percent (16%). Interest shall be (i) calculated on the
basis of a 365 day year and the actual number of days elapsed, and (ii) payable monthly, in arrears, commencing on July 2,
2018, and on the first business day of each consecutive calendar month thereafter through and including the Maturity Date,
and on the Maturity Date, whether by acceleration or otherwise (each, an “Interest Payment Date”).
Interest on the Principal Amount of this Note that is payable on July 2, 2018, August 1, 2018 and September 4, 2018 shall, in
lieu of the payment thereof in cash, be paid by adding such interest to the Principal Amount of this Note on such Interest
Payment Date (all such interest added to the Principal Amount of this Note, a “PIK Amount”). For all
purposes of this Note, all PIK Amounts shall be treated as Principal Amounts and all references in this Note to the Principal
Amount of this Note shall include all PIK Amounts.

 

          1.2          Contract
Rate Payments. The Contract Rate shall be paid on each Interest Payment Date with respect to the number of days from, but excluding,
the prior Interest Payment Date (or the issuance date with respect to the first Interest Payment Date) through and including the
applicable Interest Payment Date. Interest shall also be paid in cash on the date of any payment or prepayment of this Note with
respect to the Principal Amount being paid at such time.

 

          1.3          Principal
Payments. The outstanding Principal Amount together with any accrued and unpaid interest and any and all other unpaid amounts
which are then owing by Companies to the Holder under this Note, the Purchase Agreement and/or any other Related Agreement shall
be due and payable on the Maturity Date, whether by acceleration or otherwise.

 

          1.4          Optional
Prepayment. Companies may redeem the outstanding principal balance of this Note in whole, but not in part, at any time
after July 13, 2018, upon at least fifteen (15) days’ prior written notice delivered to Agent and the Holder, at the
prepayment price of 103% of the outstanding Principal Amount of this Note so redeemed plus all accrued but unpaid interest
hereunder.

 

 To
exercise its right to prepay this Note as provided in this Section 1.4, Companies must deliver written notice of such election
to the Agent and each Purchaser at least fifteen (15) days prior to the repayment date, as set forth in such notice, and Companies
must take the same action with respect to all of the holders of any other Notes.

 

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            1.5          Mandatory
Prepayment Events. Unless waived in writing by the Agent, Companies shall prepay this Note (a) from the net proceeds of any
incurrence of Indebtedness or other capital raising or financing transaction (other than net proceeds of any Indebtedness incurred
as permitted by clause (e)(i) of Section 8.24 of the Purchase Agreement), (b) from the net proceeds of any insurance claims relating
to any of the Collateral (unless (i) no Event of Default has occurred and is continuing, (ii) such proceeds are not greater than
$1,000,000 and (iii) such proceeds are not used to replace, restore or repair such Collateral), (c) from the net proceeds of any
sale of Collateral (other than as permitted by clause (e)(vi) of Section 8.24 of the Purchase Agreement) and/or (d) in the event
USELL elects to dissolve the SPE under Section 9.1(c) of the LLC Agreement, each a “Mandatory Prepayment Event.”
Notwithstanding the foregoing, in the event Companies raise capital solely through the issuance of equity or receive cash
proceeds from the exercise of outstanding warrants (“Equity Raise”), such Equity Raise shall not subject Companies
to a Mandatory Prepayment Event, provided that no Event of Default exists at the time of the Equity Raise or would have occurred
but for the passage of time or the giving of notice, or both, in which case the Equity Raise would create a Mandatory Prepayment
Event. Any prepayments made by Companies pursuant to a Mandatory Prepayment Event shall be applied to the outstanding principal
balance of all of the Notes then outstanding on a pro rata basis (based upon the respective outstanding principal amounts thereof).
All Principal Amounts required to be prepaid due to a Mandatory Prepayment Event are required to be prepaid at a prepayment price
of 103% of the outstanding Principal Amount of this Note so redeemed plus accrued but unpaid interest hereunder.

 

1.6       Events
of Default. The occurrence of any of the following events set forth in this Section 1.6 shall constitute an event of default
(“Event of Default”) hereunder:

 

(a)               
Failure to Pay. Any Company fails to pay when due any installment of principal, interest or other fees hereon in accordance
herewith, or any Company fails to pay any of the other Liabilities (under and as defined in the Security Agreement) within three
(3) business days of when due;

 

(b)              
Breach of Covenant. Any Company or any of its Subsidiaries breaches any covenant or any other term or condition of this
Note, the Purchase Agreement or any Related Agreement in any material respect and such breach, if subject to cure, continues for
a period of fifteen (15) days after the occurrence thereof;

 

(c)               
Breach of Representations and Warranties. Any representation, warranty or statement made or furnished by any Company or
any of its Subsidiaries in this Note, the Purchase Agreement or any other Related Agreement shall at any time be false or misleading
in any material respect on the date as of which made or deemed made;

 

(d)              
Default Under Other Agreements. The occurrence of any default (or similar term) or other event relating to any Indebtedness
or Contingent Obligation of any Company or any of such Company’s Subsidiaries beyond the period of grace (if any), (i) the
effect of which default or other event is to cause, or permit the holder or holders of such indebtedness or beneficiary or beneficiaries
of such Contingent Obligation to cause, such Indebtedness to become due prior to its stated maturity or any such Contingent Obligation
to become payable and (ii) (x) the aggregate amount of any such Indebtedness to become due prior to its stated maturity and any
such Contingent Obligations to become payable is in excess of $100,000, or (y) such default or other event is reasonably likely
to result in a Material Adverse Effect;

 

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(e)       Bankruptcy. Any
Company or any of its Subsidiaries shall (i) apply for, consent to or suffer to exist the appointment of, or the taking of
possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property,
(ii) make a general assignment for the benefit of creditors, (iii) commence a voluntary case under the federal bankruptcy
laws (as now or hereafter in effect), (iv) be adjudicated a bankrupt or insolvent, (v)   file a petition seeking to
take advantage of any other law providing for the relief of debtors, (vi)    acquiesce to, without challenge
within fifteen (15) days of the filing thereof, or failure to have dismissed, within forty-five (45) days, any petition filed
against it in any involuntary case under such bankruptcy laws, or (vii) take any action for the purpose of effecting any of
the foregoing;

 

(f)       Judgments.
Attachments or levies are made upon any Company’s or any of its Subsidiary’s assets or a judgment is rendered
against any Company or any of its Subsidiaries or any of its or their property involving a liability which is in excess of $100,000
in the aggregate with any other such liability (other than liability covered under available insurance) or could reasonably be
expected to have a Material Adverse Effect and which shall not have been vacated, discharged, stayed or bonded within thirty (30)
days from the entry thereof;

 

(g)       Insolvency.
Any Company or any of its Subsidiaries shall admit in writing its inability, or be generally unable, to pay its debts as they
become due or cease operations of its present business;

 

(h)       Change
of Control. A Change of Control (as defined below) shall occur with respect to any Company or any Guarantor, unless the Agent
shall have expressly consented to such Change of Control in writing. A “Change of Control” shall mean (i) any event
or circumstance as a result of which any “Person” or “group” (as such teinis are defined in Sections 13(d)
and 14(d) of the Exchange Act, as in effect on the date hereof), other than a Holder of a Note, is or becomes the “beneficial
owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of 20% or more on a fully
diluted basis of the then outstanding voting equity interests of any Company or any Guarantor (other than a “Person”
or “group” that beneficially owns 20% or more of such outstanding voting equity interests of any Company or any Guarantor
as of the Closing Date), (ii) any event or circumstance as a result of which USELL shall at any time own less than 100% of all
issued and outstanding equity interests of any of the following entities: HD Capital Holdings LLC, Upstream Phone Company USA,
Inc., BST Distribution, Inc. and/or Upstream Holdings, Inc., (iii) any event or circumstance as a result of which BST Distribution,
Inc. shall at any time own less than 100% of all issued an outstanding equity interests of We Sell Cellular, LLC, (iv) any change
in the composition of the Board of Directors of any Company or any Guarantor (the “Board”) such that the Continuing
Directors (as defined below) cease for any reason to constitute at least a majority of the Board (as used herein, “Continuing
Directors” means those individuals who as of the Closing Date constituted the Board and each other director that was
elected by at least 66 2/3% of the Continuing Directors, or as applicable, such director’s nomination for election to the
Board is recommended by 66 2/3% of the Continuing Directors), (v) any Company or any of the Guarantors merges or consolidates
with, or sells all or substantially all of its assets to, any other Person, or (vi) the consummation of a purchase, tender or
exchange offer made to, and accepted by, the holders of more than a majority of the outstanding shares of common stock of any
Company or any Guarantor. Notwithstanding the foregoing or anything contained herein to the contrary, clause (i) of this Section
1.6(h) shall not apply to those Persons or “groups” listed on Schedule 1.6(h) hereto, provided that such Persons or
“groups” do not beneficially own 50% or more on a fully diluted basis of the then outstanding voting equity interests
of any Company or any Guarantor;

 

    4 

     

    

 

 (i)             
Failure of Liens. The Agent’s lien on any Collateral deemed material by Agent shall fail or cease to be a first priority
validly perfected security interest; or

 

 (j)             
Breach of Covenant. The Company or any of its Subsidiaries breaches any covenant set forth in Section 5 or 8 of the Purchase
Agreement.

 

          1.7          Default
Interest. Following the occurrence and during the continuance of any Event of Default, Companies shall pay additional interest
on the outstanding Principal Amount of this Note, at a rate per annum which is determined by adding five percent (5.0%) per annum
to the Contract Rate (“Default Interest Rate”), and all outstanding obligations under this Note, the Purchase
Agreement and each other Related Agreement, including unpaid interest, shall continue to accrue interest at the Default Interest
Rate from the date of such Event of Default until the date such Event of Default is cured or waived in writing by the Agent.

 

          1.8          Acceleration.
If any Event of Default shall have occurred and be continuing, (a) if such event is an Event of Default specified in Section
1.6(e), all of the Notes at the time outstanding shall automatically become immediately due and payable together with interest
accrued thereon, without any requirement of presentment, demand, protest or notice of any kind, all of which are hereby waived,
and (b) if such event is not an Event of Default specified in Section 1.6(e) (as a result of which the Notes have already been
accelerated), the Agent or the holders of a majority of the outstanding principal amount of the Notes may at their option, by
notice in writing to Companies, declare all of the Notes to be, and all of the Notes shall thereupon be and become, immediately
due and payable together with interest accrued thereon, without any requirement of further presentment, demand, protest or other
notice of any kind, all of which are hereby waived and with the consent of the Creditor Parties, the Agent shall exercise on behalf
of the Creditor Parties (including the holders of all of the Notes) all rights and remedies available to them under the Security
Agreement and any other Related Agreement.

 

ARTICLE
II

 

MISCELLANEOUS

 

          2.1          Cumulative
Remedies. The remedies under this Note shall be cumulative.

 

          2.2          Failure
or Indulgence Not Waiver. No failure or delay on the part of the Holder (or the Agent on behalf of the Holder) hereof in the
exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise
of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. All
rights and remedies existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.

 

    5 

     

    

 

          2.3          Notices. Any
notice herein required or permitted to be given shall be given in writing in accordance with the terms of the Purchase Agreement.

 

          2.4          Amendment
Provision. The term “Note” and all references thereto, as used throughout this instrument, shall mean this
instrument as originally executed, or if later amended or supplemented, then as so amended or supplemented, and any successor
instrument as such successor instrument may be amended or supplemented.

 

          2.5          Assignability.
This Note shall be binding upon each Company and its successors and assigns, and shall inure to the benefit of the Holder
and its successors and assigns, and may be assigned by the Holder in accordance with the requirements of the Purchase Agreement.
No Company may assign any of its obligations under this Note without the prior written consent of the Holder, any such purported
assignment without such consent being null and void.

 

          2.6          Cost
of Collection. In case of the occurrence of an Event of Default under this Note, Companies shall pay the Holder (and the Agent
on behalf of the Holder) the Holder’s (and the Agent’s) costs of collection, including reasonable fees associated
with the hiring of experts and reasonable attorneys’ fees.

 

          2.7          Governing
Law, Jurisdiction and Waiver of Jury Trial. 

 

(a)               
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.

 

(b)              
EACH COMPANY HEREBY CONSENTS AND AGREES THAT THE STATE AND/OR FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK
SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY COMPANY, ON THE ONE HAND, AND THE HOLDER
AND/OR ANY OTHER CREDITOR PARTY, ON THE OTHER HAND, PERTAINING TO THIS NOTE OR ANY OF THE OTHER RELATED AGREEMENTS OR TO ANY MATTER
ARISING OUT OF OR RELATED TO THIS NOTE OR ANY OF THE RELATED AGREEMENTS; PROVIDED, THAT EACH COMPANY ACKNOWLEDGES THAT
ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW YORK; AND
FURTHER PROVIDED, THAT NOTHING IN THIS NOTE SHALL BE DEEMED OR OPERATE TO PRECLUDE THE HOLDER AND/OR ANY OTHER CREDITOR
PARTY FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION WHERE ANY OF THE COLLATERAL IS LOCATED TO COLLECT
THE LIABILITIES (AS DEFINED IN THE SECURITY AGREEMENT), TO REALIZE ON THE COLLATERAL (AS DEFINED IN THE SECURITY AGREEMENT) OR
ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE HOLDER AND/OR ANY OTHER
CREDITOR PARTY. EACH COMPANY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN
ANY SUCH COURT, AND EACH COMPANY HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER
VENUE OR FORUM NON CONVENIENS.
EACH COMPANY HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND
AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH
COMPANY AT THE ADDRESS SET FORTH IN THE PURCHASE AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER
OF SUCH COMPANY’S ACTUAL RECEIPT THEREOF OR FIVE (5) DAYS AFTER DEPOSIT IN THE U.S. MAIL, PROPER POSTAGE PREPAID.

 

    6 

     

    

 

(c)       EACH
COMPANY DESIRES THAT ITS DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL SYSTEM AND/OR OF ARBITRATION, EACH COMPANY HERETO WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION,
SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE HOLDER AND/OR
ANY OTHER CREDITOR PARTY, ON THE ONE HAND, AND EACH COMPANY, ON THE OTHER HAND, ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL
TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS NOTE, ANY OTHER RELATED AGREEMENT OR THE TRANSACTIONS RELATED
HERETO OR THERETO.

 

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

 

          2.9          Maximum
Payments. Nothing contained herein shall be deemed to establish or require the payment of a rate of interest or other
charges in excess of the maximum permitted by applicable law. In the event that the rate of interest required to be paid or other
charges hereunder exceed the maximum rate permitted by such law, any payments in excess of such maximum rate shall be credited
against amounts owed by Companies to the Holder and thus refunded to Companies.

 

2.10 
Security Interest. The Agent, for the ratable benefit of the Creditor Parties, has been granted a security interest in
certain assets of Companies and the Guarantors as more fully described in the Security Agreement and the other Related Agreements.

 

2.11
Construction; Counterparts. Each party acknowledges that its legal counsel participated in the preparation of this Note
and, therefore, stipulates that the rule of construction that ambiguities are to be resolved against the drafting party shall
not be applied in the interpretation of this Note to favor any party against the other. Unless the context otherwise requires,
(i) words in the singular or plural include the singular and plural and pronouns stated in either the masculine, the feminine
or neuter gender shall include the masculine, feminine and neuter, (ii) the words “hereof,” “herein” and
words to similar effect refer to this Note in its entirety, and (iii) the use of the word “including” in this Note
shall be by way of example rather than limitation. This Note may be executed by the parties hereto in one or more counterparts,
each of which shall be deemed an original and all of which when
taken together shall constitute one and the same instrument. Any signature delivered by a party by facsimile or electronic transmission
shall be deemed to be an original signature hereto.

 

    7 

     

    

 

2.12
Registered Obligation. This Note shall be registered (and such registration shall thereafter be maintained) as set forth
in Section 13.5(b) of the Purchase Agreement. Notwithstanding any document, instrument or agreement relating to this Note to the
contrary, transfer of this Note (or the right to any payments of principal or stated interest thereunder) may only be effected
by (i) surrender of this Note and either the reissuance by Companies of this Note to the new holder or the issuance by Companies
of a new instrument to the new holder or (ii) registration of such holder as an assignee in accordance with Section 13.5 of the
Purchase Agreement.

 

2.13
Amendment and Restatement. This Note amends and restates in its entirety the Second Amended and Restated Secured Term Note
made by Companies in favor of Holder, as of May 4, 2018, in the original principal amount of $8,660,000 (the “Prior Note”).
This Note does not constitute a novation of the Prior Note and all amounts outstanding as of the date hereof under the Prior
Note shall remain outstanding under this Note.

 

[Balance
of page intentionally left blank; signature page follows]

 

    8 

     

    

 

IN
WITNESS WHEREOF, each Company has caused this Third Amended and Restated Secured Term Note to be signed in its name effective
as of this 2nd day of July, 2018.

 

	 	USELL.COM, INC.
	 	 
		By: 	 
	 	 	Name:  Nikhil Raman
	 	 	Title:  Chief Executive Officer 

	 	 
	 	BST DISTRIBUTION, INC.
	 	 
		By: 	                  
	 	 	Name:  Brian Tepfer
	 	 	Title:  Chief Executive Officer 
	 	 	 

	 	WE SELL CELLULAR LLC 
	 	 
		By: 	
	 	 	Name:  Nikhil Raman
	 	 	Title:  Manager

 

	SIGNATURE
    PAGE TO 
THIRD AMENDED AND RESTATED
SECURED TERM NOTE

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