Document:

CONVERTIBLE
NOTE PURCHASE AGREEMENT

 

This
Convertible Note Purchase Agreement (the “Agreement”) is made as of _______ _____, 2019 by and among
Protagenic Therapeutics, Inc., a Delaware corporation (the “Company”) and the undersigned person or
entity set forth on the signature page to this Agreement (the “Purchaser”).

 

RECITALS

 

A.
The Company desires to issue and sell (the “Offering”) up to an aggregate of $2,000,000 principal amount
of convertible promissory notes in substantially the form attached to this Agreement as Exhibit A (each a “Note”
and, collectively, the “Notes”).

 

B.
The Offering is being conducted pursuant to the exemptions from the registration provisions of the Securities Act of 1933, as
amended (the “Securities Act”) provided by Section 4(a)(2) of the Securities Act and Rule 506(b) (“Rule
506”) of Regulation D thereunder.

 

C.
The Purchaser (the Purchaser, together with the other purchasers of the Notes, are sometimes referred to collectively as the “Purchasers”)
desires to purchase a Note.

 

AGREEMENT

 

In
consideration of the mutual promises contained herein and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties to this Agreement agree as follows:

 

1.
Purchase and Sale of Notes.

 

a.
Sale and Issuance of Notes. Subject to the terms and conditions of this Agreement, the Purchaser agrees to
purchase at the Closing (as defined below) and the Company agrees to sell and issue to the Purchaser at the Closing, Notes in
the aggregate principal amount set forth opposite the Purchaser’s name on the Purchaser signature page to this Agreement.

 

b.
Closing; Delivery.

 

i.
The purchase and sale of the Notes (the “Closing”) shall take place at the offices of Meister Seelig
& Fein LLP, 125 Park Avenue, 7th Floor, New York, NY 10017, as soon as practicable after such date that each of
the conditions set forth in Sections 4 and 5 hereof is satisfied or waived, or on such other date and at such other place as the
Company and the Placement Agent (as defined below) may agree upon in writing (the date on which the Closing occurs is referred
to herein as the “Closing Date”). The parties acknowledge that there may be more than one Closing during
the course of the Offering.

 

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ii.
At the Closing, the Company shall deliver or caused to be delivered to the Purchaser (which delivery shall be deemed accomplished
by delivery to Katalyst Securities LLC, as placement agent (the “Placement Agent”) for the Offering):

 

1.
the Note executed by the Company;

 

2.
a guaranty (the “Guaranty”), substantially in the form of Exhibit B hereto, executed by Protagenic
Therapeutics Canada (2006) Inc., a corporation formed in 2006 under the laws of the Province of Ontario, Canada (“Protagenic
Canada”);

 

3.
a certificate of the Executive Chairman of the Company certifying the accuracy of the Company’s representations and warranties
as of the Closing; and

 

4.
a certificate of the Chief Financial Officer of the Company certifying the authority of the officer executing this Agreement and
all agreements and other documents ancillary hereto and contemplated hereby, including the Note (collectively, the “Loan
Documents”).

 

iii.
At the Closing, the Purchaser shall pay the Purchase Price for the Notes by wire transfer in immediately available funds in accordance
with the wire transfer instructions attached hereto as Exhibit C.

 

2.
Representations and Warranties of the Company. The Company hereby represents and warrants to the Purchaser that,
except as set forth in either the schedules delivered herewith (collectively, the “Disclosure Schedules”)
or the SEC Reports (as such term is defined below):

 

a.
Organization, Good Standing and Qualification. Each of the Company and its Subsidiary (as defined below) is a corporation
duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite
corporate power and authority to carry on its business as now conducted and to own or lease its properties. Each of the Company
and its Subsidiary is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property makes such qualification or leasing necessary unless the failure
to be in good standing or so qualify has not had and could not reasonably be expected to have a Material Adverse Effect. The Company’s
only Subsidiary is Protagenic Canada.

 

For
purposes of this Agreement, the following terms have the meanings set forth below:

 

“Material
Adverse Effect” means a material adverse effect on (i) the assets, liabilities, results of operations, condition
(financial or otherwise), business, or prospects of the Company and its Subsidiary taken as a whole, or (ii) the ability of the
Company to perform its obligations under the Loan Documents.

 

“Person”
means an individual, corporation, partnership, limited liability company, trust, business trust, association, joint stock company,
joint venture, sole proprietorship, unincorporated organization, governmental authority or any other form of entity not specifically
listed herein.

 

“Subsidiary”
of any Person means another Person, an amount of the voting securities, other voting ownership or voting partnership interests
of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such
voting interests, 50% or more of the equity interests of which) is owned directly or indirectly by such first Person.

 

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b.
Authorization. The Company has all corporate power and authority and has taken all requisite action on the part
of the Company, its officers, directors and stockholders necessary for (i) the authorization, execution and delivery of the Loan
Documents, (ii) the authorization of the performance of all obligations of the Company hereunder or thereunder, and (iii) the
authorization, issuance (or reservation for issuance) and delivery of the Notes and the shares of common stock, $0.0001 par value
per share (the “Common Stock”) of the Company issuable upon conversion thereof (the “Conversion
Shares” and, together with the Notes, the “Securities”). The Loan Documents, upon execution
and delivery thereof by the Company, will constitute the legal, valid and binding obligations of the Company, enforceable against
the Company in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability, relating to or affecting creditors’ rights generally and to general equitable
principles.

 

c.
Capitalization. The Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019 (the
“June 10-Q”) sets forth as of its date: (i) the authorized and outstanding capital stock of the Company;
(ii) the number of shares of capital stock issuable pursuant to the Company’s stock plans; and (iii) the number of shares
of capital stock issuable and reserved for issuance pursuant to securities (other than the Notes) exercisable for, or convertible
into or exchangeable for any shares of capital stock of the Company. All of the issued and outstanding shares of the Company’s
capital stock have been duly authorized and validly issued and are fully paid, nonassessable and free of pre-emptive rights and
were issued in full compliance with applicable state and federal securities law and any rights of third parties. All of the issued
and outstanding shares of capital stock of the Subsidiary have been duly authorized and validly issued and are fully paid, nonassessable
and free of pre-emptive rights, were issued in full compliance with applicable state and federal securities law and any rights
of third parties and are owned by the Company, beneficially and of record, subject to no Lien (as defined below). No Person is
entitled to pre-emptive or similar statutory or contractual rights with respect to any securities of the Company. Except as contemplated
by the Loan Documents and except as disclosed in the SEC Reports, there are no outstanding warrants, options, convertible securities
or other rights, agreements or arrangements of any character under which the Company or its Subsidiary is or may be obligated
to issue any equity securities of any kind. Except as disclosed in the SEC Reports and except for the Loan Documents, there are
no voting agreements, buy-sell agreements, option or right of first purchase agreements or other agreements of any kind among
the Company and any of the securityholders of the Company relating to the securities of the Company held by them. Except as disclosed
in the SEC Reports, no Person has the right to require the Company to register any securities of the Company under the Securities
Act, whether on a demand basis or in connection with the registration of securities of the Company for its own account or for
the account of any other Person.

 

For
purposes of this Agreement, “Lien” shall mean, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, encumbrance, charge or security interest of any kind in respect of such asset, whether or not filed, recorded
or otherwise perfected under applicable law, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital
lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing)
relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect
to such securities.

 

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d.
Governmental Approval. No action, consent or approval of, registration or filing with or any other action by any
federal, state, local or foreign court or governmental agency, authority, instrumentality or regulatory body (collectively, “Governmental
Authority”) is or will be required in connection with the transactions contemplated hereby, except for such as have
been made or obtained and are in full force and effect and post-sale filings pursuant to applicable state and federal securities
laws which the Company undertakes to file within the applicable time periods.

 

e.
Accuracy of Filings. Neither the Company’s most recent Annual Report on Form 10-K for the fiscal year ended
December 31, 2018 (the “10-K”) nor any of the Company’ s reports, schedules, forms, statements
and other documents filed with the Securities and Exchange Commission (the “SEC”) since the filing of
the 10-K (collectively, the “SEC Reports”), including, without limitation, the Company’s Quarterly
Reports on Forms 10-Q, at the time of filing contained any untrue statement of a material fact or omitted to state a material
fact required to make the statements contained therein, in light of the circumstances in which they were made, not misleading,
except to the extent that such statements have been modified or superseded by later SEC Reports filed on a non-confidential basis
filed prior to the date hereof.

 

f.
No Material Adverse Effect. Since December 31, 2018, except as identified and described in the SEC Reports or as
described in Section 2(f) of the Disclosure Schedules, no Material Adverse Effect has occurred with respect to the business,
assets, liabilities, operations, condition (financial or otherwise), or operating results of the Company or the Subsidiary, taken
as a whole.

 

g.
Title to Properties. The Company and each Subsidiary has good and marketable title to all real properties and all
other properties and assets owned by it, in each case free from Liens that would materially affect the value thereof or materially
interfere with the use made or currently planned to be made thereof by them; the Company and the Subsidiary holds any leased real
or personal property under valid and enforceable leases with no exceptions that would materially interfere with the use made or
currently planned to be made thereof by them.

 

h.
Intellectual Property.

 

i.
All Intellectual Property (as defined below) of the Company and its Subsidiary necessary for the operation of the business as
currently conducted or as presently proposed to be conducted is currently in material compliance with all legal requirements (including
timely filings, proofs and payments of fees) and is valid and enforceable. No Intellectual Property of the Company or its Subsidiary
which is necessary for the conduct of Company’s and the Subsidiary’s respective businesses as currently conducted
or as currently proposed to be conducted has been or is now involved in any cancellation, dispute or litigation, and, to the Company’s
knowledge, no such action is threatened. No patent of the Company or its Subsidiary has been or is now involved in any interference,
reissue, re-examination or opposition proceeding.

 

For
purposes of this Agreement, “Intellectual Property” means all of the following: (A) patents, patent
applications, patent disclosures and inventions (whether or not patentable and whether or not reduced to practice); (B) trademarks,
service marks, trade dress, trade names, corporate names, logos, slogans and Internet domain names, together with all goodwill
associated with each of the foregoing; (C) copyrights and copyrightable works; (D) registrations, applications and renewals for
any of the foregoing; and (E) proprietary computer software (including but not limited to data, data bases and documentation).

 

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ii.
All of the licenses and sublicenses and consent, royalty or other agreements concerning Intellectual Property which are necessary
for the conduct of the Company’s and the Subsidiary’s respective businesses as currently conducted or as currently
proposed to be conducted to which the Company or the Subsidiary is a party or by which any of their assets are bound (other than
generally commercially available, non-custom, off-the-shelf software application programs having a retail acquisition price of
less than $10,000 per license) (collectively, “License Agreements”) are valid and binding obligations
of the Company or its Subsidiary and, to the Company’s knowledge, the other parties thereto, enforceable in accordance with
their terms, except to the extent that enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other similar laws affecting the enforcement of creditors’ rights generally, and, to the Company’s
knowledge, there exists no event or condition which will result in a material violation or breach of or constitute (with or without
due notice or lapse of time or both) a default by the Company or its Subsidiary under any such License Agreement.

 

iii.
The Company and its Subsidiary own or have the valid right to use all of the Intellectual Property that is necessary for the conduct
of the Company’s and its Subsidiary’s respective businesses as currently conducted or as currently proposed to be
conducted and for the ownership, maintenance and operation of the Company’s and its Subsidiary’s properties and assets,
free and clear of all Liens, adverse claims or obligations to license all such owned Intellectual Property and trade secrets,
confidential information and know-how (including but not limited to ideas, formulae, compositions, processes, procedures and techniques,
research and development information, computer program code, performance specifications, support documentation, drawings, specifications,
designs, business and marketing plans, and customer and supplier lists and related information) (collectively, “Confidential
Information”), other than licenses entered into in the ordinary course of the Company’s and its Subsidiary’s
businesses. The Company and its Subsidiary have a valid and enforceable right to use all third party Intellectual Property and
Confidential Information used or held for use in the respective businesses of the Company and its Subsidiary

 

iv.
To the knowledge of the Company, the conduct of the Company’s and its Subsidiary’s businesses as currently conducted
does not infringe or otherwise impair or conflict with (collectively, “Infringe”) any Intellectual Property
rights of any third party or any confidentiality obligation owed to a third party, and, to the Company’s knowledge, the
Intellectual Property and Confidential Information of the Company and its Subsidiary which are necessary for the conduct of Company’s
and its Subsidiary’s respective businesses as currently conducted or as currently proposed to be conducted are not being
Infringed by any third party. There is no litigation or order pending or outstanding or, to the Company’s knowledge, threatened,
that seeks to limit or challenge or that concerns the ownership, use, validity or enforceability of any Intellectual Property
or Confidential Information of the Company and its Subsidiary and the Company’s and its Subsidiary’s use of any Intellectual
Property or Confidential Information owned by a third party, and, to the Company’s knowledge, there is no valid basis for
the same.

 

v.
The consummation of the transactions contemplated hereby and by the other Loan Documents will not result in the alteration, loss,
impairment of or restriction on the Company’s or its Subsidiary’s ownership or right to use any of the Intellectual
Property or Confidential Information which is necessary for the conduct of Company’s and its Subsidiary’s respective
businesses as currently conducted or as currently proposed to be conducted.

 

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vi.
The Company and its Subsidiary have taken reasonable steps to protect the Company’s and its Subsidiary’s rights in
their Intellectual Property and Confidential Information. Each employee, consultant and contractor who has had access to Confidential
Information which is necessary for the conduct of Company’s and its Subsidiary’s respective businesses as currently
conducted or as currently proposed to be conducted has executed an agreement to maintain the confidentiality of such Confidential
Information and has executed appropriate agreements that are substantially consistent with the Company’s standard forms
thereof. Except under confidentiality obligations, there has been no material disclosure of any of the Company’s or its
Subsidiary’s Confidential Information to any third party.

 

i.
Compliance with Laws. Except as described in the SEC Reports or as set forth on Section 2(i) of the Disclosure
Schedules, there are no actions, suits or proceedings at law or in equity or by or before any Governmental Authority now pending
or, to the knowledge of the Company, threatened against or affecting the Company or its Subsidiary or any business, property or
rights of any of the foregoing (i) that involve this Agreement or any Loan Document or (ii) as to which, if adversely determined,
could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect in the Company or its Subsidiary.
Neither the Company nor its Subsidiary or any of their respective properties or assets is in violation of, nor will the continued
operation of their properties and assets as currently conducted violate, any law, rule or regulation (including any applicable
environmental law, ordinance, code or approval) or any restrictions of record or agreements affecting the properties, or is in
default with respect to any judgment, writ, injunction, decree or order of any Governmental Authority, where such violation or
default could reasonably be expected to result in a Material Adverse Effect in the Company or its Subsidiary. The Company and
its Subsidiary possess adequate certificates, authorities or permits issued by appropriate Governmental Authorities necessary
to conduct the business now operated by it, except where such failure has not had and could not reasonably be expected to have
a Material Adverse Effect, individually or in the aggregate, and neither the Company nor its Subsidiary has received any notice
of proceedings relating to the revocation or modification of any such certificate, authority or permit that, if determined adversely
to the Company or such Subsidiary, could reasonably be expected to have a Material Adverse Effect, individually or in the aggregate.

 

j.
Tax Returns. The Company and its Subsidiary have timely prepared and filed (or timely filed for an extension for)
all tax returns required to have been filed by the Company or such Subsidiary with all appropriate Governmental Authorities and
timely paid all taxes shown thereon or otherwise owed by it, other than taxes being contested in good faith and for which adequate
reserves have been made on the Company’s financial statements included in the SEC Reports. The charges, accruals and reserves
on the books of the Company in respect of taxes for all fiscal periods are adequate in all material respects, and there are no
material unpaid assessments against the Company or its Subsidiary nor, to the Company’s knowledge, any basis for the assessment
of any additional taxes, penalties or interest for any fiscal period or audits by any federal, state or local taxing authority
except for any assessment which is not material to the Company and its Subsidiary, taken as a whole. All taxes and other assessments
and levies that the Company or its Subsidiary is required to withhold or to collect for payment have been duly withheld and collected
and paid to the proper Governmental Authority or third party when due, other than taxes being contested in good faith and for
which adequate reserves have been made on the Company’s financial statements included in the SEC Reports. There are no tax
Liens or claims pending or, to the Company’s knowledge, threatened against the Company or its Subsidiary or any of their
respective assets or property.

 

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k.
Solvency. Immediately after the consummation of the transactions to occur on the Closing Date and immediately following
the purchase of the Notes and after giving effect to the application of the proceeds thereof as of the date thereof: (i) the fair
value of the assets of the Company and its Subsidiary, at a fair valuation, will exceed its debts and liabilities, subordinated,
contingent or otherwise; (ii) the present fair saleable value of the property of the Company and its Subsidiary will be greater
than the amount that will be required to pay the current probable liability of its debts and other liabilities, subordinated,
contingent or otherwise, as such debts and other liabilities become absolute and matured; and (iii) in the reasonable judgment
of the Company, each of the Company and its Subsidiary will be able to pay its debts and liabilities then-outstanding at such
time.

 

l.
Rule 506 Compliance. To the Company’s knowledge, neither the Company nor any director, executive officer,
other officer of the Company participating in the offering, any beneficial owner of 20% or more of the Company’s outstanding
voting equity securities, calculated on the basis of voting power, and any promoter connected with the Company in any capacity
on the date hereof (each, an “Insider”) is subject to any of the “Bad Actor” disqualifications
described in Rule 506(d)(1)(i) to (viii) under the Securities Act (a “Disqualification Event”), except
for a Disqualification Event covered by Rule 506(d)(2)(i) or (d)(3) of the Securities Act. The Company is not disqualified from
relying on Rule 506 for any of the reasons stated in Rule 506(d) in connection with the issuance and sale of the Securities to
the Purchaser pursuant to this Agreement. The Company has exercised reasonable care, including without limitation, conducting
a factual inquiry that is appropriate in light of the circumstances, into whether any such disqualification under Rule 506(d)
exists. The Company has furnished to the Purchaser, a reasonable time prior to the date hereof, a description in writing of any
matters relating to the Company and the Insiders that would have triggered disqualification under Rule 506(d) but which occurred
before September 23, 2013, in each case, in compliance with the disclosure requirements of Rule 506(e).

 

3.
Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants to the Company that:

 

a.
Organization and Existence. Such Purchaser, if such Purchaser is an entity, is a validly existing corporation, limited
partnership or limited liability company and has all requisite corporate, partnership or limited liability company power and authority,
and if such Purchaser is a natural person, all requisite power and authority, to invest in the Securities pursuant to this Agreement.

 

b.
Authorization. The execution, delivery and performance by such Purchaser of the Loan Documents to which such Purchaser
is a party have been duly authorized and each will constitute the valid and legally binding obligation of such Purchaser, enforceable
against such Purchaser in accordance with their respective terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability, relating to or affecting creditors’ rights generally.

 

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c.
Purchase Entirely for Own Account. The Securities to be received by such Purchaser hereunder will be acquired for
such Purchaser’s own account, not as nominee or agent, and not with a view to the resale or distribution of any part thereof,
and such Purchaser has no present intention of selling, granting any participation in, or otherwise distributing the same.

 

d.
Investment Experience. Such Purchaser acknowledges that it can bear the economic risk and complete loss of its investment
in the Securities and has such knowledge and experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment contemplated hereby.

 

e.
Disclosure of Information. Such Purchaser has had an opportunity to receive all information related to the Company
requested by it and to ask questions of and receive answers from the Company regarding the Company, its business and the terms
and conditions of the offering of the Securities. Such Purchaser acknowledges that Purchaser has had the opportunity to review
the SEC Reports and, without limiting the generality of the foregoing, that Purchaser has received copies of the 10-K, the June
10-Q and the Company’s Proxy Statement for the 2019 Annual Meeting of Stockholders.

 

f.
Restricted Securities. Such Purchaser understands that the Securities are characterized as “restricted securities”
under the U.S. federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public
offering and that under such laws and applicable regulations such securities may be resold without registration under the Securities
Act only in certain limited circumstances.

 

g.
Legends. It is understood that, except as provided below, certificates evidencing the Securities may bear the following
or any similar legend:

 

i.
“The securities represented hereby have not 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, and, accordingly,
may not be transferred unless (i) such securities have been registered for sale pursuant to the Securities Act of 1933, as amended,
(ii) such securities may be sold pursuant to Rule 144, or (iii) the Company has received an opinion of counsel reasonably satisfactory
to it that such transfer may lawfully be made without registration under the Securities Act of 1933, as amended.”

 

ii.
If required by the authorities of any state in connection with the issuance of sale of the Securities, the legend required by
such state authority.

 

h.
Accredited Investor. Such Purchaser is an accredited investor as defined in Rule 501(a) of Regulation D under the
Securities Act.

 

i.
Rule 506 Compliance. Neither such Purchaser nor any of its directors, executive officers, other officers that may
serve as a director or officer of any company in which it invests, general partners or managing members is subject to any Disqualification
Event (as defined above), except for Disqualification Events covered by Rule 506(d)(2)(ii) or (iii) under the Securities Act and
disclosed in writing in reasonable detail to the Company.

 

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4.
Conditions of the Purchaser’s Obligations at Closing. The obligations of the Purchaser to the Company under
this Agreement are subject to the fulfillment of each of the following conditions, unless otherwise waived:

 

a.
Representations and Warranties. The representations and warranties made by the Company in Section 2 hereof
qualified as to materiality shall be true and correct at all times prior to and on the Closing Date, except to the extent any
such representation or warranty expressly speaks as of an earlier date, in which case such representation or warranty shall be
true and correct as of such earlier date, and, the representations and warranties made by the Company in Section 2 hereof
not qualified as to materiality shall be true and correct in all respects at all times prior to and on the Closing Date, except
to the extent any such representation or warranty expressly speaks as of an earlier date, in which case such representation or
warranty shall be true and correct in all respects as of such earlier date. The Company shall have performed in all respects all
obligations and covenants herein required to be performed by it on or prior to the Closing Date.

 

b.
Qualifications. All authorizations, approvals or permits, if any, of any Governmental Authority that are required
in connection with the lawful issuance and sale of the Securities pursuant to this Agreement shall be obtained and effective as
of the Closing.

 

c.
Deliveries. The Company shall have executed the Note and shall have made all deliveries required pursuant to Section
1(b)(ii).

 

5.
Conditions of the Company’s Obligations at Closing. The obligations of the Company to the Purchaser under
this Agreement are subject to the fulfillment of each of the following conditions, unless otherwise waived:

 

a. Representations
and Warranties. The representations and warranties made by the Purchasers in Section 3 hereof, other than the
representations and warranties contained in Sections 3(c), (d), (e), (f), (g) and (h) (the
“Investment Representations”), shall be true and correct in all material respects when made, and
shall be true and correct in all material respects on the Closing Date with the same force and effect as if they had been
made on and as of said date. The Investment Representations shall be true and correct in all respects when made, and shall be
true and correct in all respects on the Closing Date with the same force and effect as if they had been made on and as of
said date. The Purchaser shall have performed in all material respects all obligations and covenants herein required to be
performed by them on or prior to the Closing Date.

 

b.
Deliveries. The Purchaser shall delivered the Purchase Price for the Note to the Company, in accordance with Section
1(b)(iii).

 

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6.
Covenants of the Company. The Company covenants and agrees with the Purchaser that, so long as this Agreement shall
remain in effect and until all Liabilities under the Notes (as defined therein) have been satisfied by the Company, unless the
holders of a majority of the principal amount of the Notes then outstanding (a “Holder Majority”) shall
otherwise consent in writing:

 

a.
Existence; Compliance with Laws. The Company and its Subsidiary shall (i) do or cause to be done all things reasonably
necessary to preserve, renew and keep in full force and effect its legal existence; (ii) do or cause to be done all things reasonably
necessary to obtain, preserve, renew, extend and keep in full force and effect the rights, licenses, permits, franchises, authorizations,
patents, copyrights, trademarks and trade names material to the conduct of its business; maintain and operate such business in
substantially the manner in which it is presently conducted and operated other than any change thereof that would not result in
a Material Adverse Effect; comply in all material respects with all applicable laws, rules, regulations and decrees and orders
of any Governmental Authority, whether now in effect or hereafter enacted; and at all times maintain and preserve all property
material to the conduct of such business and keep such property in good repair, working order and condition; (iii) keep its insurable
properties adequately insured at all times by financially sound and reputable insurers; maintain such other insurance, to such
extent and against such risks, including fire and other risks insured against by extended coverage, as is customary with competitors
in the same industry operating in similar locations, including public liability insurance against claims for personal injury or
death or property damage occurring upon, in, about or in connection with the use of any properties owned, occupied or controlled
by it; and maintain such other insurance as may be required by law; (iv) pay and discharge promptly when due (or otherwise escrow,
bond or insure) all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in
respect of its property, before the same shall become delinquent or in default, as well as all lawful claims for labor, materials
and supplies or otherwise that, if unpaid, might give rise to a Lien upon such properties or any part thereof; provided , however
, that such payment and discharge (or escrow, bonding or insurance) shall not be required with respect to any such tax, assessment,
charge, levy or claim so long as the validity or amount thereof shall be contested in good faith by appropriate proceedings and
the Company shall have set aside on its books adequate reserves with respect thereto in accordance with generally accepted accounting
principles and such contest operates to suspend collection of the contested obligation, tax, assessment or charge and enforcement
of a Lien and there is no risk of forfeiture of such property; (v) solely in the case of the Company, timely and accurately file,
report and otherwise disclose all matters required by any Governmental Authority, including, without limitation, all reports and
forms required pursuant to rules promulgated by the SEC.

 

b.
Notices. The Company shall furnish to the Purchaser prompt written notice of the following: (i) any Event of Default
or Default (each as defined in the Note), specifying the nature and extent thereof and the corrective action (if any) taken or
proposed to be taken with respect thereto; (ii) the filing or commencement of, or any threat or notice of intention of any person
or entity to file or commence, any action, suit or proceeding, whether at law or in equity or by or before any Governmental Authority,
against the Company or its Subsidiary that could reasonably be expected to result in a Material Adverse Effect; (iii) any loss,
damage, or destruction to the real or personal properties (or any other assets) of the Company or the Subsidiary in the amount
of $150,000 or more, whether or not covered by insurance; (iv) any notices received by the Company regarding any (A) alleged material
default, (B) termination of a material lease or eviction from any leased premises or (C) failure to pay rent or any other material
monetary obligation, each with respect to any leased property; and (v) any development that has resulted in, or could reasonably
be expected to result in, a Material Adverse Effect.

 

c.
Transactions with Affiliates. The Company and the Subsidiary shall not, except for transactions between the Company
and the Subsidiary, sell or transfer any property or assets to, or purchase or acquire any property or assets from, or otherwise
engage in any other transactions with, any of its affiliates, except that the Company or the Subsidiary may engage in any of the
foregoing transactions in the ordinary course of business at prices and on terms and conditions not less favorable to the Company
or such Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties.

 

    	10

     

    

 

7.
Miscellaneous.

 

a.
Successors and Assigns. The terms and conditions of this Agreement shall inure to the benefit of and be binding
upon the respective successors and assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer
upon any party other than the parties hereto and the other Purchasers in the Offering or their respective successors and assigns
any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
Neither party may assign this Agreement without the prior written consent of the other party.

 

b.
Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of New York without regard to the choice of law principles thereof. Each of
the parties hereto irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York
County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding
or judgment relating to or arising out of this Agreement and the transactions contemplated hereby. Service of process in connection
with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified
for the giving of notices under this Agreement. Each of the parties hereto irrevocably consents to the jurisdiction of any such
court in any such suit, action or proceeding and to the laying of venue in such court. Each party hereto irrevocably waives any
objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim
that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE PARTIES
HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL
HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

 

c.
Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original
and all of which together shall constitute one instrument.

 

d.
Notices. Any notice required or permitted by this Agreement shall be in writing and shall be deemed sufficient (i)
upon receipt, when delivered personally or by courier, (ii) the next business day after sent, when sent by overnight delivery
service, (iii) upon delivery if given by electronic mail during normal business hours of the recipient, and if not sent during
normal business hours, then on the recipient’s next business day, or (iv) three (3) business days after being deposited
in the U.S. mail as certified or registered mail, return receipt requested, with postage prepaid, if in each instance such notice
is addressed to the party to be notified at such party’s address as set forth below or as subsequently modified by written
notice.

 

If
to the Company, addressed to:

 

Protagenic
Therapeutics, Inc.

149
Fifth Avenue, Suite 500

New
York, NY 10010

Attention:
Alexander K. Arrow

E-mail:
alex.arrow@protagenic.com

 

    	11

     

    

 

If
to Purchaser, addressed to Purchaser at the address set forth on the Purchaser signature page of this Agreement.

 

e.
Amendments and Waivers. Any term of this Agreement may be amended or waived only with the written consent of the
Company and a Holder Majority.

 

f.
Confidentiality. Each party hereto agrees that, except with the prior written permission of the other party or otherwise
required by law, it shall at all times keep confidential and not divulge, furnish or make accessible to anyone any confidential
information, knowledge or data concerning or relating to the business or financial affairs of the other party (or its affiliates)
to which such party has been or shall become privy by reason of this Agreement or any other Loan Document, discussions or negotiations
relating to this Agreement or any other Loan Document, or the performance of its obligations hereunder or thereunder. This Section
does not apply to information that is entirely in the public domain, previously known to the recipient of the information (as
evidenced by written, dated business records of such recipient), received lawfully from a third party, or independently developed
without access to such information. Notwithstanding the foregoing, the parties agree that the Company shall file a Current Report
on Form 8-K describing the transactions contemplated under the Loan Documents. In addition, the Company will make such other filings
and notices in the manner and time required by the SEC.

 

g.
Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, the
parties agree to renegotiate such provision in good faith, in order to maintain the economic position enjoyed by each party as
close as possible to that under the provision rendered unenforceable. Any amendments of any such provisions may only be effected
in the manner set forth in Section 7(e) above. In the event that the parties cannot reach a mutually agreeable and enforceable
replacement for such provision, then (i) such provision shall be excluded from this Agreement, (ii) the balance of the Agreement
shall be interpreted as if such provision were so excluded and (iii) the balance of the Agreement shall be enforceable in accordance
with its terms.

 

h.
Expenses. The parties hereto shall pay their own costs and expenses related to the transactions contemplated by
this Agreement.

 

i.
Headings. The headings in this Agreement are used for convenience only and are not to be considered in construing or
interpreting any provision of this Agreement.

 

j.
Entire Agreement. This Agreement and the Loan Documents constitute the entire agreement between the parties hereto
pertaining to the purchase of the Note.

 

[Remainder
of page intentionally blank; signature pages follow]

 

    	12

     

    

 

IN
WITNESS WHEREOF, the parties have executed this Convertible Note Purchase Agreement as of the date first written above.

 

COMPANY:

 

PROTAGENIC
THERAPEUTICS, INC.

 

	By:	 	 
	Name:	Garo
    H. Armen	 
	Title:	Executive
    Chairman	 

 

    	13

     

    

 

[PURCHASER
SIGNATURE PAGE TO CONVERTIBLE NOTE PURCHASE AGREEMENT]

 

IN
WITNESS WHEREOF, the parties have executed this Convertible Note Purchase Agreement as of the date first written above.

 

	FOR
    INDIVIDUALS:	 	FOR
    ENTITIES:
	 	 	 
	 	 	 
	Print
    Name	 	Print
    Name of Entity
	 	 	 
	 	 	 
	Signature	 	Signature
    of Authorized Signatory
	 	 	 
	 	 	 
	 
	 	Print
    Name of Authorized Signatory
	 	 	 
	 	 	 
	 
	 	Print
    Title of Authorized Signatory
	 	 	 
	 	 	 
	Home
    Address	 	 
	 	 	 
	 	 	 
	 	 	 
	Email
    Address	 	 
	 	 	 
	 	 	Business
    Address
	Social
    Security No.	 	 
	 	 	 
	 	 	Email
    Address
	 	 	 
	 	 	 
	 	 	Taxpayer
    Identification Number
	 	 	 
	Principal
    amount of Notes subscribed for:	 	$

 

    	14

     

    

 

Exhibit
A

 

Form
of Note

 

    	15

     

    

 

Exhibit
B

 

Guaranty

 

    	16

     

    

 

Exhibit
C

 

Wire
Transfer Instructions

 

Protagenic
Therapeutics, Inc.

 

 

Wire
Instructions

 

	149
    Fifth Ave, Suite 500	 	New
    York, NY 10010
	www.protagenic.com	 	213-260-4342

 

Bank
Information & Contacts:

 

Bank
of America

8813
Villa La Jolla Drive

La
Jolla, CA 92037

858-812-9837

Customer
Service: 800-432-1000

 

German
Carrasco

Vice
President, Small Business Officer

San
Diego Market

Bank
of America

CA0-122-01-01,
7680 Girard Ave, La Jolla, CA 92037

T
619-990-2202 F 972-725-6796

g.carrasco@BankofAmerica.com

 

Bank
Routing & Account Number:

 

Account
name: XXXXXX

Account
Number: XXXXXX

Routing
Number: XXXXXX

Routing
Number: XXXXXX

 

	Swift
    Code: 	XXXXXX
	 	XXXXXX

 

Account
Address: Protagenic Therapeutics, Inc., 149 Fifth Ave, Suite 500, New York, NY 10010

 

Officer
Authorization:

 

Alexander
K. Arrow, MD, CFA

Chief
Financial Officer

 

    	17THE
SECURITIES REPRESENTED HEREBY HAVE NOT 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, AND, ACCORDINGLY, MAY
NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED,
(II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE 144, OR (III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY
TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

 

CONVERTIBLE
PROMISSORY NOTE

 

	$[●].00
    	______
    ___, 2019

 

FOR
VALUE RECEIVED, Protagenic Therapeutics, Inc., a Delaware corporation (the “Company” ), promises
to pay to the order of [●], or its registered assigns (“Purchaser” or “Holder”),
the principal sum of [●] Dollars ($[●].00) (the “ Principal Amount ” ) with interest
on the outstanding Principal Amount accruing as set forth in Section 1. Interest shall commence with the date hereof and
shall continue on the outstanding principal of this Convertible Promissory Note (this “Note” ) as set
forth in Section 1 until paid in accordance with the provisions hereof.

 

 1. Interest. 

 

a. Interest
shall accrue on the outstanding Principal Amount at the rate of six percent (6%) per annum simple interest (computed on the basis
of actual days elapsed and a fiscal year of 364 days).

 

b. Accrued
interest shall be payable annually, in arrears, beginning on October 31, 2020, and thereafter on the last calendar day of each
successive twelve (12) month period (each, an “Interest Payment Date”). The Company shall pay (a “PIK
Payment”) the interest due by adding such interest (including interest at the Default Rate, as defined below, if
any) to the then-outstanding Principal Amount on each Interest Payment Date and on the Maturity Date (as defined below). Each
PIK Payment shall be preceded by written notice from the Company to Purchaser not less than five (5) business days prior to the
date such interest payment is due setting forth in reasonable detail the amount of such PIK Payment and the Principal Amount of
the Note following such PIK Payment.

 

c. Upon
any default pursuant to this Note or any other Loan Document, this Note shall bear interest at the rate of the lesser of (i) twelve
percent (12%) and (ii) such maximum rate of interest allowable under the laws of the State of New York (the “Default
Rate”).

 

2. Convertible
Note Purchase Agreement. This Note is one of a series of Notes of issued pursuant to, and is governed by and subject in
all respect to, the terms of Note Purchase Agreements (the “Note Purchase Agreement”) between the Company
and each of the Purchasers named therein. Each of the several Note Purchase Agreements is identical in all material respects.
The Notes shall rank equally and ratably without priority over one another. Capitalized terms used in this Note and not defined
herein shall have the meanings ascribed to such terms in the Purchase Agreement.

 

    	 	1	 

    	 

    

 

3. Maturity.

 

a. The
entire unpaid principal amount and all unpaid accrued interest (collectively, the “Obligations”) shall
become fully due and payable on November 6, 2023 (the “Maturity Date”). On the Maturity Date, the Company
shall pay the Obligations either, at its option, entirely in cash or entirely by converting the Obligations to Conversion Shares
(as defined below) (the “Maturity PIK Right”) at the Conversion Price (as defined below). Any such conversion
of the Obligations into Conversion Shares upon exercise of the Maturity PIK Right shall be in accordance with Section 6(e) below.
The Company shall send the Purchaser a Conversion Notice notifying Purchaser of its exercise of the Maturity PIK Right at least
ten (10) business days prior to the Maturity Date. The Company may only exercise the Maturity PIK Right ratably as to all the
Notes issued in the Offering in proportion to their then-outstanding respective Principal Amounts, plus accrued and unpaid interest
thereon. In addition, if applicable stock exchange listing rules so require, the Company may not exercise the Maturity PIK Right
to the extent that the aggregate number of Conversion Shares issued upon conversion of this Note and the other Notes issued under
the Note Purchase Agreements (together with any other securities issued by the Company that are deemed integrated into the issuance
of the Notes under the Note Purchase Agreement pursuant to applicable stock exchange listing rules) would be in excess of 19.99%
of the shares of Common Stock outstanding immediately prior to the issuance of this Note.

 

b. After
all Obligations at any time owed on this Note have been paid in full or this Note has been converted in full to Conversion Shares,
this Note shall be surrendered to the Company for cancellation and shall not be reissued.

 

4. Payments.
All payments of the Obligations shall be made in lawful money of the United States of America to Purchaser (unless this Note
otherwise provides for such payment by a PIK Payment or by the issuance of Conversion Shares pursuant to the Maturity PIK Right
or Section 6(b) hereof), at the address specified in the Note Agreement, or at such other address as may be specified from
time to time by Purchaser in a written notice delivered to the Company. All payments shall be applied first to accrued interest,
expenses or fees due to Purchaser pursuant to this Note or any other Loan Document, and thereafter to principal.

 

5. Use
of Proceeds. The Company shall use the proceeds from this Note for the following purposes:

 

a. To
facilitate the Company’s preparation of its IND filing, fund Phase 1 clinical trials, and to begin Phase 2 trials;

 

b. Payment
of transaction fees and expenses; and

 

c. working
capital and general corporate purposes.

 

    	 	2	 

    	 

    

 

6. Conversion.

 

a. Subject
to applicable stock exchange listing rule limitations (including, if applicable, approval by the Company’s stockholders),
at any time following the date of this Note and up to the Maturity Date, the then-outstanding Obligations under this Note (or
any portion thereof) may be converted into fully paid and nonassessable shares of the Company’s Common Stock, $0.0001 par
value per share (the “Conversion Shares”), at the sole election of Purchaser upon written notice to
the Company (the “Conversion Notice”), which Conversion Notice shall state the proposed effective date
of such conversion (which date shall be no fewer than ten (10) business days following the date of delivery of the Conversion
Notice) (the “Conversion Date”). The Obligations hereunder shall convert at a conversion price (the
“Conversion Price”) equal to $1.25 per share, subject to adjustment for any stock dividend, stock split,
combination or other similar recapitalization event with respect to the Company’s Common Stock (each a “Recapitalization
Event”). Interest on the Note shall cease to accrue on the date prior to the Conversion Date.

 

b. Notwithstanding
the conversion rights set forth in Section 6(a) above, subject to applicable stock exchange listing rule limitations (including,
if applicable, approval by the Company’s stockholders), in the event, any time after the November 5, 2021, that the closing
bid price per share of the Common Stock as traded on the principal securities exchange or securities market on which the Common
Stock are then traded equals or exceeds $1.50 (subject to adjustment for any Recapitalization Event) for at least twenty (20)
Trading Days (as defined below), whether or not consecutive, in any thirty (30) consecutive Trading Day period, the then-outstanding
Obligations under this Note (or any portion thereof) may be redeemed or converted, in whole or in part, into cash or Conversion
Shares, at the sole election of the Company following delivery of written notice (the “Redemption Notice”)
to Purchaser. The Redemption Notice shall set forth the proposed redemption date (the “Redemption Date”)
(which Redemption Date, for the sake of clarity, shall be no fewer than ten (10) business days following the date of delivery
of the Redemption Notice), the aggregate dollar amount of Obligations being redeemed and whether the redemption shall be in cash
or Conversion Shares. Any redemption effected by the delivery of Conversion Shares shall be at a conversion price equal to the
then-current Conversion Price. Interest on the Note shall cease to accrue on the day prior to the Redemption Date. The Company
may only exercise the redemption right set forth herein ratably as to all the Notes issued in the Offering in proportion to their
then-outstanding Principal Amounts, plus accrued and unpaid interest thereon.

 

c. If
applicable stock exchange listing rules so require, and notwithstanding anything in this Section 6 to the contrary, the
Company shall not effect the conversion of this Note, and Purchaser shall not have the right to convert this Note, to the extent
that the aggregate number of Conversion Shares issued upon conversion of this Note and the other Notes issued under the Note Purchase
Agreements (together with any other securities issued by the Company that are deemed integrated into the issuance of the Notes
under the Note Purchase Agreement pursuant to applicable stock exchange listing rules) would be in excess of 19.99% of the shares
of Common Stock outstanding immediately prior to the issuance of this Note. In the event the holders of the Notes issued under
the Note Purchase Agreements elect to convert the Notes pursuant to Section 6(a), and such Notes will not be fully convertible
due to the limitations set forth in this Section 6(c), the Company shall use its commercially reasonable efforts to obtain
stockholder approval of the issuance of the Notes in accordance with applicable stock exchange listing rules as soon as reasonably
practicable, including by calling a special meeting of stockholders. For purposes of this Section 6(c), the terms “commercially
reasonable efforts” shall include, without limitation, the obligation of the Company take all action necessary to call a
meeting of its stockholders (the “Stockholders Meeting”), which shall occur not later than 90 days after
Purchaser’s request for the same (the “Stockholders Meeting Deadline”), for the purpose of seeking
approval of the Company’s stockholders for, among other things, the issuance and sale of the Conversion Shares to Purchaser
(the “Proposal”). In the event the Proposal is not approved by the Company’s stockholders at the
Stockholders Meeting, the Company shall take all action necessary to call up to two (2) additional meetings of its stockholders
(each a “Subsequent Stockholders Meeting”) for the purpose of seeking approval of the Proposal, to be
held promptly following the completion of the Stockholders Meeting and in no event more than one year after Purchaser’s
request for the same, to the extent reasonably practicable. In connection with the Stockholders Meeting and, if applicable, each
Subsequent Stockholders Meeting, the Company will promptly prepare and file with the SEC proxy materials (including a proxy statement
and form of proxy) for use at the Stockholders Meeting and, if applicable, each Subsequent Stockholders Meeting, and, after receiving
and promptly responding to any comments of the SEC thereon, shall promptly mail such proxy materials (or, if permitted, notice
of the availability of such proxy materials) to the stockholders of the Company. Purchaser shall promptly furnish in writing to
the Company such information relating to such Purchaser and its investment in the Company as the Company may reasonably request
for inclusion in each Proxy Statement. The Company will comply with Section 14(a) of the Securities Exchange Act of 1934 (the
“1934 Act”) and the rules promulgated thereunder in relation to any proxy statement (as amended or supplemented,
each a “Proxy Statement”) and any form of proxy to be sent or made available to the stockholders of
the Company in connection with the Stockholders Meeting or, if applicable, each Subsequent Stockholders Meeting, and each Proxy
Statement shall not, on the date that such Proxy Statement (or any amendment thereof or supplement thereto) is first mailed or
made available to stockholders or at the time of the Stockholders Meeting or any Subsequent Stockholders Meeting, contain any
untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein
not false or misleading, or omit to state any material fact necessary to correct any statement in any earlier communication with
respect to the solicitation of proxies or the Stockholders Meeting which has become false or misleading. If the Company should
discover at any time prior to the Stockholders Meeting or, if applicable, any Subsequent Stockholders Meeting, any event relating
to the Company or any of its Subsidiaries or any of their respective Affiliates, officers or directors that is required to be
set forth in a supplement or amendment to the applicable Proxy Statement, in addition to the Company’s obligations under the 1934
Act, the Company will promptly inform the Purchaser thereof.

 

    	 	3	 

    	 

    

 

d. Upon
the Conversion Date or Redemption Date, as the case may be, with respect to a conversion of this Note pursuant to either Section
6(a), 6(b) or Section 3 above, Purchaser hereby agrees to deliver the original of this Note to the Company for
cancellation (or a notice to the effect that the original Note has been lost, stolen or destroyed and an agreement acceptable
to the Company whereby Purchaser agrees to indemnify the Company from any loss incurred by it in connection with this Note); provided,
however, that upon the Conversion Date, this Note (or portion thereof) shall be deemed converted and of no further force and
effect, whether or not it is delivered for cancellation as set forth in this sentence.

 

e. On
or before the second Trading Day following the Conversion Date or Redemption Date, as the case may be (the “Share
Delivery Date”), the Company shall, (i) provided that the Company’s transfer agent is participating
in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program (the “FAST
Program”) and so long as the certificates therefor are not required to bear a legend regarding restriction on transferability,
upon the request of Purchaser, credit such aggregate number of shares of Common Stock to which Purchaser is entitled pursuant
to such exercise to Purchaser’s or its designee’s balance account with DTC through its Deposit Withdrawal Agent Commission
system, or (ii), if the Company’s transfer agent is not participating in the FAST Program or if the certificates are required
to bear a legend regarding restriction on transferability, issue and dispatch by overnight courier to the address as specified
in the Conversion Notice or as provided by Purchaser to the Company, a certificate, registered in the Company’s share register
in the name of Purchaser or its designee, for the number of shares of Common Stock to which Purchaser is entitled pursuant to
such exercise. Upon the Conversion Date, Purchaser shall be deemed for all corporate purposes to have become the holder of record
of the Conversion Shares with respect to which this Note (or portion thereof) has been converted, irrespective of the date such
Conversion Shares are credited to the Holder’s DTC account or the date of delivery of the certificates evidencing such Conversion
Shares, as the case may be.

 

For
purposes of this Note, “Trading Day” means any day on which the Common Stock are traded on The NASDAQ
Capital Market or, if such market is not the principal trading market for the Common Stock, then on the principal securities exchange
or securities market on which the Common Stock are then traded; provided that “Trading Day” shall
not include any day on which the Common Stock are scheduled to trade on such exchange or market for less than 4.5 hours or any
day that the Common Stock are suspended from trading during the final hour of trading on such exchange or market (or if such exchange
or market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at
4:00:00 p.m., New York time).

 

f. No
fractional shares shall be issued upon conversion of this Note. In lieu of the Company issuing any fractional shares to Purchaser
upon the conversion of this Note, the Company shall pay to Purchaser an amount equal to the product obtained by multiplying the
Conversion Price by the fraction of a share not issued pursuant to the previous sentence.

 

7. Default.

 

a. Events
of Default. For purposes of this Note, any of the following events shall constitute an “Event of Default”:

 

i. The
Company shall fail to pay when due any Obligations hereunder;

 

ii. Any
representation or warranty of the Company under the Note Purchase Agreement, the other Loan Documents or any agreement ancillary
thereto (collectively, the “Ancillary Agreements” ), as applicable, shall be untrue in any material
respect as of the date made;

 

iii. The
Company shall breach any covenant set forth in this Note or the Ancillary Agreements, taking into account applicable periods of
notice and cure, if any; provided, however , that, in the event no grace or cure period is so provided, the Company shall
have a period of (A) three (3) days after the earlier of the Company’ s actual knowledge thereof and written notice of non-compliance
to cure such non-compliance to the extent it relates to any monetary default and (B) twenty (20) days after the earlier of the
Company’ s actual knowledge thereof and written notice of non-compliance to cure any other non-compliance; provided that,
in the event that any default described in clause (B) cannot reasonably be cured within such twenty (20) day period, then the
Company shall have an additional ten (10) days in which to cure such non-compliance, so long as the Company continues to diligently
pursue curing such non-compliance;

 

    	 	4	 

    	 

    

 

iv. The
Company makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts as they become due,
or files a voluntary petition for bankruptcy, or files any petition or answer seeking for itself any reorganization, arrangement,
composition, readjustment, dissolution or similar relief under any present or future statute, law or regulation, or seeks or consents
to or acquiesces in the appointment of any trustee, receiver or liquidator of the Company, or of all or any substantial part of
the properties of the Company, or the Company or its respective directors or majority stockholders takes any action looking to
the dissolution, liquidation or winding up of the Company;

 

v. An
involuntary proceeding shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking
(i) relief in respect of the Company under Title 11 of the United States Code, as now constituted or hereafter amended, or any
other federal, state or foreign bankruptcy, insolvency, receivership or similar law, (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Company or for a substantial part of the property or assets of
the Company or (iii) the winding-up or liquidation of the Company or; and such proceeding or petition shall continue undismissed
for thirty (30) days or an order or decree approving or ordering any of the foregoing shall be entered; or

 

vi. One
or more judgments shall be rendered against the Company and the same shall remain undischarged for a period of thirty (30) consecutive
days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to levy
upon assets or properties of the Company or to enforce any such judgment and such judgment either (i) is for the payment of money
in an aggregate amount in excess of $250,000 or (ii) is for injunctive relief and could reasonably be expected to result in a
Material Adverse Effect.

 

b. Consequences
of Events of Default. If any Event of Default shall occur for any reason, whether voluntary or involuntary, or continue
beyond the expiration of any applicable cure period, upon notice or demand, the Holder Majority may declare the outstanding indebtedness
under this Note, together with all other amounts due or owing to Purchaser pursuant to any Ancillary Agreements, to be due and
payable, whereupon each of the foregoing shall be and become immediately due and payable, and the Company shall immediately pay
to Purchaser all such indebtedness, without presentment, demand, protest or any other notice of any kind, all of which are hereby
expressly waived by the Company, anything contained herein or in any Ancillary Agreement to the contrary notwithstanding; provided,
however, that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Company under the
United States Bankruptcy Code, then all indebtedness under this Note, together with all other amounts due or owing to Purchaser
pursuant to any Ancillary Agreements, shall automatically be due immediately without notice of any kind.

 

8. Lost,
Stolen, Destroyed or Mutilated Note. In case this Note shall be mutilated, lost, stolen or destroyed, the Company shall
issue a new Note of like date, tenor and denomination and deliver the same in exchange and substitution for and upon surrender
and cancellation of any mutilated Note, or in lieu of any Note lost, stolen or destroyed, upon receipt of evidence satisfactory
to the Company of the loss, theft or destruction of such Note and an agreement from Purchaser to indemnify the Company against
any claim that may be made against the Company on account of the mutilation, loss, theft or destruction of this Note.

 

    	 	5	 

    	 

    

 

9. Governing
Law. This Note is to be construed in accordance with and governed by the laws of the State of New York, without regard
to principles of conflict of laws.

 

10. Amendment
and Waiver. Any term of this Note may be amended and the observance of any term of this Note may be waived (either generally
or in a particular instance and either retroactively or prospectively), only with the written consents of the Holder Majority
and the Company.

 

11. Notice. Except as may be otherwise provided herein, all notices, requests, waivers and other communications made pursuant to
this Note shall be made in accordance with Section 7(d) of the Note Purchase Agreement.

 

12. Severability.
If one or more provisions of this Note are held to be unenforceable under applicable law, such provision shall be excluded
from this Note and the balance of the Note shall be interpreted as if such provision were so excluded and shall be enforceable
in accordance with its terms.

 

13. Successors
and Assigns; Assignment. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer upon
any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities
under or by reason of this Agreement, except as expressly provided in this Agreement. Neither party may assign this Agreement
without the prior written consent of the other party.

 

14. Remedies
Cumulative; Failure or Indulgence Not a Waiver. The remedies provided in this Note shall be cumulative and in addition
to all other remedies available under this Note, the Note Purchase Agreement and the Ancillary Agreements. No failure or delay
on the part of Purchaser in the exercise of any power, right or privilege hereunder or under this Note, the Note Purchase Agreement
or any Ancillary Agreement 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.

 

15. Payments.
Whenever any payment of cash is to be made by the Company to Purchaser pursuant to this Note, such payment shall be made in
lawful money of the United States of America by, at the Company’s option, a check drawn on the account of the Company
and sent via overnight courier service to Purchaser at the address previously provided to the Company in writing (which address
shall initially be the address for Purchaser as set forth in the Note Purchase Agreement), electronic funds transfer, or wire
transfer of immediately available funds, to an account designated in writing by Purchaser. Whenever any payment to be made shall
otherwise be due on a day which is not a business day, such payment shall be made on the immediately succeeding business day and
such extension of time shall be included in the computation of accrued interest.

 

    	 	6	 

    	 

    

 

16. Excessive
Interest. Notwithstanding any other provision herein to the contrary, this Note is hereby expressly limited so that the
interest rate charged hereunder shall at no time exceed the maximum rate permitted by applicable law. If, for any circumstance
whatsoever, the interest rate charged exceeds the maximum rate permitted by applicable law, the interest rate shall be reduced
to the maximum rate permitted, and if Purchaser shall have received an amount that would cause the interest rate charged to be
in excess of the maximum rate permitted, such amount that would be excessive interest shall be applied to the reduction of the
principal amount owing hereunder (without charge for prepayment) and not to the payment of interest, or if such excessive interest
exceeds the unpaid balance of principal, such excess shall be refunded to the Company.

 

17.
Headings. The headings in this Note are used for convenience only and are not to be considered in construing or
interpreting any provision of this Note.

 

[Signature
Page Follows]

 

    	 	7	 

    	 

    

 

IN
WITNESS WHEREOF, the Company has executed this Note as of the date first above written.

 

PROTAGENIC
THERAPEUTICS, INC. 

 

	By:	 	 
	Name:	Garo
    H. Armen	 
	Title:	Executive
    Chairman	 

 

    	 	8

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