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
AUGUST 10, 2021

 

	No.
    2016-1	 	 
	$100,000	 	AUGUST
    10, 2016

 

FOR
VALUE RECEIVED, PLASTIC2OIL, INC., a Nevada corporation (herein called the “Company”), for value received hereby promises
to pay on AUGUST 10, 2021, to LAWRENCE LEAHY, with an address at #206 Cowley Avenue, Ottawa Ontario, K1Y 0G0 (herein
called the “Holder”), the principal sum of One Hundred Thousand Dollars ($100,000), 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 in the
same offering, as well as the following purchasers of $4 million aggregate principal amount of similar 12% secured promissory
notes which were sold in offerings in 2013 and 2014: Mr. Richard Heddle, personally, as purchaser of 12% secured promissory notes
in August or September of 2013 in an aggregate principal amount of $3 million”, and Heddle Marine Services Inc., a corporation,
as purchaser of 12% secured promissory note on November 19, 2014 in an aggregate principal amount of $1 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 LAWRENCE LEAHY or any party to whom this Warrant is assigned in accordance with its terms is entitled to
subscribe for and purchase 100,000 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 AUGUS 10, 2021

 

1.5
“Holder” means LAWRENCE LEAHY 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:

LAWRENCE
LEAHY 

#206
COWLEY AVENUE, OTTAWA 

ONTARIO,
K1Y 0G0

 

(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 AUGUST 8, 2016

 

	 	By:	/s/
    Rahoul Banerjea
	 	Name:	Rahoul
    Banerjea
	 	Title:	Chief
    Financial Officer

 

    	 	 	 

    	 	 	 

    

 

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)

 

    	 	 	 

    	 	 	 

    

 

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)

 

    	 	 	 

    	 	 	 

    

 

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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