Document:

THIS NOTE HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (“SECURITIES ACT”), OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE MAY NOT BE
SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR PURSUANT TO AN EXEMPTION THEREFROM UNDER THE SECURITIES
ACT AND SUCH STATE LAWS, SUPPORTED BY AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED.

 

12% SECURED PROMISSORY NOTE

DUE NOVEMBER 19, 2019

 

	No. 2014-1	 	 
	$1,000,000	 	November 19, 2014

 

FOR VALUE RECEIVED, PLASTIC2OIL,
INC., a Nevada corporation (herein called the “Company”), for value received hereby promises to pay on November 19,
2019, to Heddle Marine Service Inc., with an address at 208 Hillyard St., Hamilton, Ontario, Canada L8L 6B6 (herein called the
“Holder”), the principal sum of One Million Dollars ($1,000,000), together with interest upon the principal hereof
at the rate of 12% per annum. Interest on this Note shall be compounded annually and shall accrue on the outstanding principal
amount on this Note from the date of issuance until the date of repayment of the principal and payment of accrued interest in full.
Interest shall be calculated on the basis of a 365 day year and shall be payable at maturity. Payments hereunder shall be made
at such place as the holder hereof shall designate to the undersigned, in writing, in lawful money of the United States of America.
Any payment which becomes due on a Saturday, Sunday or legal holiday shall be payable on the next business day.

 

 

This Note shall, (i) upon
declaration by the Holder or (ii) automatically upon acceleration pursuant to clause (c) below, become immediately due and payable
upon the occurrence of any of the following specified events of default:

 

	(a)	
        If the Company shall default in the due and
        punctual payment of the principal amount of this Note when and as the same shall become due and payable, whether at maturity or
        by acceleration; or

         

	(b)	
        If the Company shall default in the due and
        punctual payment of interest on this Note when the same shall become due and payable; or

         

	(c)	If the Company shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, or shall consent to any such relief or to the appointment of or taking of possession by any such official in an involuntary case or other proceeding commenced against it, or shall make a general assignment for the benefit of creditors, or shall take any corporate action to authorize any of the foregoing; or an involuntary case or other proceeding shall be commenced against the Company seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed or unstayed for a period of 60 consecutive days; or

 

	 (d)	
        Company defaults in the performance of any
        covenant or other provision with respect to this Note or any other agreement between Company and the Holder or the Collateral Agent
        (as defined in the Security Agreement referred to below); or

         

	(e)	
        Company fails to pay when due (whether at the
        stated maturity, by acceleration or otherwise) any indebtedness for borrowed money owing to the Holder (other than under this Note),
        any third party or the occurrence of any event which could result in acceleration of payment of any such indebtedness or the failure
        to perform any agreement with any third party; or

         

	(f)	
        any representation or warranty made in this
        Note, any related document, any agreement between Company and the Holder or the Collateral Agent or in any financial statement
        of Company proves to have been misleading in any material respect when made; Company omits to state a material fact necessary to
        make the statements made in this Note, any related document, any agreement between Company and the Holder or the Collateral Agent
        or any financial statement of Company not misleading in light of the circumstances in which they were made; or, if upon the date
        of execution of this Note, there shall have been any material adverse change in any of the facts disclosed in any financial statement,
        representation or warranty that was not disclosed in writing to the Holder at or prior to the time of execution hereof; or

         

	(g)	
        any pension plan of Company fails to comply
        with applicable law or has vested unfunded liabilities that, in the opinion of the Holder, might have a material adverse effect
        on Company’s ability to repay its debts; or

         

	(h)	
        if the validity of this Note or any mortgage,
        pledge agreement, security agreement or any other collateral agreement, including without limitation the Security Agreement, shall
        have been challenged or disaffirmed by or on behalf of any of such parties thereto; or if, other than as a direct result of any
        action or inaction of the Holder, the liens created or intended to be created by any such collateral agreements shall at any time
        cease to be valid and perfected first priority liens in favor of Holder’s collateral agent, subject to no equal or prior
        liens.

         

Declaration of this Note being immediately
due and payable by the Holder may only be made by written notice to the Company declaring the unpaid balance of the principal amount
of this Note and accrued interest thereon to be due. Such declaration shall be deemed given upon the occurrence of any event specified
in clause (c) above. In the event of a default, all costs of collection, including reasonable attorneys’ fees, shall be paid
by the Company.

 

This Note may be prepaid by the Company in
whole or in part at any time or from time to time without penalty or premium. This Note is not assignable by the holder hereof
and any such purported assignment shall be null and void.

 

The Company for itself and its successors and
assigns hereby waives presentment, demand, notice, protest and all other demands and notices in connection with the delivery, acceptance,
performance or endorsement of this Note, and agrees that this Note shall be deemed to have been made under, and shall be interpreted
and governed by reference to, the laws of the State of New York.

 

Except as expressly agreed in writing by the
Holder, no extension of time for payment of this Note, or any installment hereof, and no alteration, amendment or waiver of any
provision of this Note shall release, discharge, modify, change or affect the liability of the Company under this Note.

 

All of the covenants, stipulations, promises
and agreements made by or contained in this Note on behalf of the undersigned shall bind its successors, whether so expressed or
not.

 

No failure on the part of the Holder to exercise,
and no delay in exercising, any right under this Note shall operate as a waiver thereof, nor shall any single or partial exercise
of such rights preclude any other or further exercise thereof or the exercise of any other right.

 

It is the intention of the Company and the
Holder that all payments due hereunder will be treated for accounting and tax purposes as indebtedness of the Company to the Holder.
Each of the Company and the Holder agrees to report such payments due hereunder for the purposes of all taxes in a manner consistent
with such intended characterization.

 

If any term or provision of this Note shall
be held invalid, illegal or unenforceable, the validity of all other terms and provisions herein shall in no way be affected thereby.

 

The Company’s obligations under this
Note shall be secured pursuant to that certain Security Agreement, dated as of August 29, 2013 (the “Security Agreement”),
by the Company and certain of its subsidiaries, each as grantor, in favor of the Collateral Agent for the benefit of the purchasers
of 12% secured promissory notes of like tenor issued by the Company, including Mr. Richard Heddle, personally, as purchaser of
12% secured promissory notes in August or September of 2013 in an aggregate principal amount of $2 million (this Note and such
other notes are collectively, the “12% Company Notes”). The Company’s obligations under this Note and the other
12% Company Notes are also secured by each of the following agreements made in favor of the holders of 12% Company Notes by the
Company (and if requested by the Collateral Agent or the Holder, one or more of its subsidiaries) (the “Additional Collateral
Documents”):

 

	(a)	
        mortgages in the Company’s (or one of
        its subsidiaries’, as applicable) real properties located in Niagara Falls, New York;

         

	(b)	one or more intellectual property security agreements covering material intellectual property owned by the Company (or one of its subsidiaries, as applicable).

 

IN WITNESS WHEREOF, the
Company has caused this Note to be signed in its corporate name by its Chief Financial Officer as of the date hereinabove set forth.

 

	 	PLASTIC2OIL, INC.
	 	 	 
	 	By:	/S/Rahoul   Banerjea
	 	 	Name: Rahoul Banerjea
	 	 	Title: Chief Financial OfficerTHE SECURITIES REPRESENTED
BY THIS CERTIFICATE MAY NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR IN ACCORDANCE WITH AN EXEMPTION FROM REGISTRATION UNDER THAT ACT, SUPPORTED
BY AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

 

WARRANT TO PURCHASE

SHARES OF COMMON STOCK OF

PLASTIC2OIL, INC.

 

This certifies that Richard
Heddle or any party to whom this Warrant is assigned in accordance with its terms is entitled to subscribe for and purchase 1,000,000
shares of the Common Stock of Plastic2Oil, Inc., a Nevada corporation, on the terms and conditions of this Warrant.

 

1. Definitions.
As used in this Warrant, the term:

 

1.1 “Business Day”
means any day other than a Saturday, Sunday, or a day on which banking institutions in the State of New York are authorized or
obligated to be closed by law or by executive order.

 

1.2 “Common Stock”
means the Common Stock, par value $.001 per share, of the Corporation.

 

1.3 “Corporation”
means Plastic2Oil, Inc. a Nevada corporation, or its successor.

 

1.4 “Expiration Date”
means November 19, 2019.

 

1.5 “Holder”
means Heddle Marine Service Inc. or any party to whom this Warrant is assigned in accordance with its terms.

 

1.6 “1933 Act”
means the Securities Act of 1933, as amended.

 

1.7 “Warrant”
means this Warrant and any warrants delivered in substitution or exchange for this Warrant in accordance with the provisions of
this Warrant.

 

1.8 “Warrant Price”
means $0.12 per share of Common Stock, as such amount may be adjusted pursuant to Section 4 hereof.

 

2. Exercise of Warrant.
At any time before the Expiration Date, the Holder may exercise the purchase rights represented by this Warrant, in whole or in
part, by surrendering this Warrant (with a duly executed subscription in the form attached) at the Corporation’s principal
corporate office (located on the date hereof in Niagara Falls, New York) and by paying the Corporation, by certified or cashier’s
check, the aggregate Warrant Price for the shares of Common Stock being purchased.

  

2.1 Delivery of Certificates.
Within thirty (30) days after each exercise of the purchase rights represented by this Warrant, the Corporation shall deliver a
certificate for the shares of Common Stock so purchased to the Holder and, unless this Warrant has been fully exercised or expired,
a new Warrant representing the balance of the shares of Common Stock subject to this Warrant.

 

2.2 Effect of Exercise. The
person entitled to receive the shares of Common Stock issuable upon any exercise of the purchase rights represented by this Warrant
shall be treated for all purposes as the holder of such shares of record as of the close of business on the date of exercise.

 

3. Stock Fully Paid;
Reservation of Shares. The Corporation covenants and agrees that all securities that it may issue upon the exercise of the
rights represented by this Warrant will, upon issuance, be fully paid and nonassessable and free from all taxes, liens and charges.
The Corporation further covenants and agrees that, during the period within which the Holder may exercise the rights represented
by this Warrant, the Corporation shall at all times have authorized and reserved for issuance enough shares of its Common Stock
or other securities for the full exercise of the rights represented by this Warrant. The Corporation shall not, by an amendment
to its Articles of Incorporation or through reorganization, consolidation, merger, dissolution, issue or sale of securities, sale
of assets or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant.

 

4. Adjustments.
The Warrant Price and the number of shares of Common Stock that the Corporation must issue upon exercise of this Warrant shall
be subject to adjustment in accordance with Sections 4.1 through 4.3.

 

4.1 Adjustment to Warrant
Price for Combinations or Subdivisions of Common Stock. If the Corporation at any time or from time to time after the date hereof
(1) declares or pays, without consideration, any dividend on the Common Stock payable in Common Stock; (2) creates any right to
acquire Common Stock for no consideration; (3) subdivides the outstanding shares of Common Stock (by stock split, reclassification
or otherwise); or (4) combines or consolidates the outstanding shares of Common Stock, by reclassification or otherwise, into a
lesser number of shares of Common Stock, the Corporation shall proportionately increase or decrease the Warrant Price, as appropriate.

 

4.2 Adjustments for Reclassification
and Reorganization. If the Common Stock issuable upon exercise of this Warrant changes into shares of any other class or classes
of security or into any other property for any reason other than a subdivision or combination of shares provided for in Section
4.1, including without limitation any reorganization, reclassification, merger or consolidation, the Corporation shall take all
steps necessary to give the Holder the right, by exercising this Warrant, to purchase the kind and amount of securities or other
property receivable upon any such change by the owner of the number of shares of Common Stock subject to this Warrant immediately
before the change.

 

4.3 Spin Offs. If the Corporation
spins off any subsidiary by distributing to the Corporation’s shareholders as a dividend or otherwise any stock or other
securities of the subsidiary, the Corporation shall reserve until the Expiration Date enough of such shares or other securities
for delivery to the Holders upon any exercise of the rights represented by this Warrant to the same extent as if the Holders owned
of record all Common Stock or other securities subject to this Warrant on the record date for the distribution of the subsidiary’s
shares or other securities.

  

4.4 Certificates as to Adjustments.
Upon each adjustment or readjustment required by this Section 4, the Corporation at its expense shall promptly compute such adjustment
or readjustment in accordance with this Section, cause independent public accountants selected by the Corporation to verify such
computation and prepare and furnish to the Holder a certificate setting forth such adjustment or readjustment and showing in detail
the facts upon which such adjustment or readjustment is based.

 

5. Fractional Shares.
The Corporation shall not issue any fractional shares in connection with any exercise of this Warrant.

 

6. Dissolution or Liquidation.
If the Corporation dissolves, liquidates or winds up its business before the exercise or expiration of this Warrant, the Holder
shall be entitled, upon exercising this Warrant, to receive in lieu of the shares of Common Stock or any other securities receivable
upon such exercise, the same kind and amount of assets as would have been issued, distributed or paid to it upon any such dissolution,
liquidation or winding up with respect to such shares of Common Stock or other securities, had the Holder been the holder of record
on the record date for the determination of those entitled to receive any such liquidating distribution or, if no record is taken,
upon the date of such liquidating distribution. If any such dissolution, liquidation or winding up results in a cash distribution
or distribution of property which the Corporation’s Board of Directors determines in good faith to have a cash value in excess
of the Warrant Price provided by this Warrant, then the Holder may, at its option, exercise this Warrant without paying the aggregate
Warrant Price and, in such case, the Corporation shall, in making settlement to Holder, deduct from the amount payable to Holder
an amount equal to such aggregate Warrant Price.

 

7. Transfer and Exchange.

 

7.1 Transfer. Subject to
Section 7.3, the Holder may transfer all or part of this Warrant at any time on the books of the Corporation at its principal office
upon surrender of this Warrant, properly endorsed. Upon such surrender, the Corporation shall issue and deliver to the transferee
a new Warrant or Warrants representing the Warrants so transferred. Upon any partial transfer, the Corporation shall issue and
deliver to the Holder a new Warrant or Warrants with respect to the Warrants not so transferred.

 

7.2 Exchange. The Holder
may exchange this Warrant at any time at the principal office of the Corporation for Warrants in such denominations as the Holder
may designate in writing. No such exchanges will increase the total number of shares of Common Stock or other securities that are
subject to this Warrant.

 

7.3 Securities Act of 1933.
By accepting this Warrant, the Holder agrees that this Warrant and the shares of the Common Stock issuable upon exercise of this
Warrant may not be offered or sold except in compliance with the 1933 Act, and then only with the recipient’s agreement to
comply with this Section 7 with respect to any resale or other disposition of such securities. The Corporation may make a notation
on its records in order to implement such restriction on transferability.

 

 

8. Loss or Mutilation.
Upon the Corporation’s receipt of reasonably satisfactory evidence of the ownership and the loss, theft, destruction or mutilation
of this Warrant and (in the case of loss, theft or destruction) of a reasonably satisfactory indemnity or (in the case of mutilation)
upon surrender and cancellation of this Warrant, the Corporation shall execute and deliver a new Warrant to the Holder.

 

9. Successors. All
the covenants and provisions of this Warrant shall bind and inure to the benefit of the Holder and the Corporation and their respective
successors and assigns.

 

10. Notices. All
notices and other communications given pursuant to this Warrant shall be in writing and shall be deemed to have been given when
personally delivered or when mailed by prepaid registered, certified or express mail, return receipt requested. Notices should
be addressed as follows:

 

	
               (a)
        If to Holder, then to:

               Heddle
        Marine Service Inc.

               208
        Hillyard Street Hamilton

               Ontario,
        Canada L8L6B6

 

	
               (b)
        If to the Corporation, then to:

               Plastic2Oil,
        Inc.

               20
        Iroquois Street

               Niagara
        Falls, NY 14303

               Attention:
        Chief Financial Officer

	 	 

Such addresses for notices
may be changed by any party by notice to the other party pursuant to this Section 10.

 

11. Amendment. This
Warrant may be amended only by an instrument in writing signed by the Corporation and the Holder.

 

12. Construction of
Warrant. This Warrant shall be construed as a whole and in accordance with its fair meaning. A reference in this Warrant to
any section shall be deemed to include a reference to every section the number of which begins with the number of the section to
which reference is made. This Warrant has been negotiated by both parties and its language shall not be construed for or against
any party.

 

13. Law Governing.
This Warrant is executed, delivered and to be performed in the State of New York and shall be construed and enforced in accordance
with and governed by the New York law without regard to any conflicts of law or choice of forum provisions.

 

 

Dated as of November 19, 2014

 

	 	By:	/S/ Rahoul Banerjea__
	 	 	Name: Rahoul Banerjea
	 	 	Title: Chief Financial Officer

 

 

    	(1)

    	 

    

 

SUBSCRIPTION FORM

 

(To be executed only upon exercise of Warrant)

 

The undersigned registered
owner of this Warrant irrevocably exercises this Warrant and agrees to purchase _______ shares of Common Stock of Plastic2Oil,
Inc., all at the price and on the terms and conditions specified in this Warrant.

 

The undersigned acknowledges
that, by issuing shares of Common Stock to the undersigned upon exercise of the Warrant, the Company is relying on an exemption
from the registration of such shares under the Securities Act of 1933, as amended, or other applicable law. In accordance therewith,
the undersigned represents and warrants that the representations and warranties of the undersigned contained in the Subscription
Agreement between the Company and the undersigned, pursuant to which the undersigned purchased the Warrant, along with the undersigned’s
answers to the applicable investor questionnaires annexed thereto, are true and correct in all material respects as of the date
hereof.

 

Dated: __________________

 

	 	 
	 	(Signature of Registered Holder)
	 	 
	 	 
	 	(Street Address)
	 	 
	 	 
	 	(City) (State) (Zip)

 

 

    	(2)

    	 

    

 

ISSUE OF A NEW WARRANT

(To be executed only upon partial exercise,

exchange, or partial transfer of Warrant)

 

Please issue ______ Warrants,
each representing the right to purchase ________ shares of Common Stock of Plastic2Oil, Inc. to the registered holder.

 

Dated: ________________

 

	 	 
	 	(Signature of Registered Holder)

 

 

    	(3)

    	 

    

 

FORM OF ASSIGNMENT

 

FOR VALUE RECEIVED, the
undersigned registered Holder of this Warrant sells, assigns and transfers unto the Assignee named below all of the rights of the
undersigned under the Warrant, with respect to the number of shares of Common Stock set forth below (the “Transfer”):

 

	Name of Assignee	 	Address	 	No. of Shares
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

The undersigned irrevocably
constitutes and appoints _______ as the undersigned’s attorney-in-fact, with full power of substitution, to make the transfer
on the books of Plastic2Oil, Inc.

 

Dated: ________________

 

	 	 
	 	(Signature)

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