Document:

AMENDMENT
TO WARRANT TO PURCHASE SHARES

 

This
Amendment to Warrant to Purchase Shares (this “Amendment”), dated as of April 6, 2018, is by and between Hancock
Jaffe Laboratories, Inc., a Delaware corporation (the “Company”), and [___________] (the “Holder”),
and amends that certain Warrant to Purchase Shares, issued as of [__________], by the Company to the Holder (the “Warrant”).
Capitalized terms used but not defined herein shall have the meaning ascribed to such terms in the Warrant.

 

RECITALS

 

WHEREAS,
the Warrant may be modified or amended with the written consent of the Company and the Holder; and

 

WHEREAS,
the Company and the Holder desire to amend the Warrant to remove certain repricing provisions and the ratchet dilution adjustment
provisions that would otherwise create derivative liability for the Company and negatively impact the Company’s shareholder’s
equity, as hereinafter set forth and as subject to the terms and conditions of this Amendment.

 

AGREEMENT

 

NOW,
THEREFORE, for good and valuable consideration the receipt and sufficiency of which are hereby acknowledged and agreed, the parties
hereby agree as follows:

 

1. Amendment
to Section 3.4(d). The following provision from Section 3.4(d) of the Warrant is hereby deleted:

 

“provided,
however, the Holder at its option may elect to receive an amount in unregistered shares of the common stock of the surviving
entity equal to the value of this Warrant calculated in accordance with the Black-Scholes formula; provided, further,
such shares of common stock shall be valued at a [thirty-five (35%) percent] discount to the VWAP of the common stock for the
twenty (20) Business Days immediately prior to the Recap Event”.

 

New
Section 3.4(d) of the Warrant shall now read as follows:

 

“(d)
effect a capital reorganization or reclassification of its Common Stock, then, and in the case of each such Recap Event, proper
provision shall be made to the ExercisePrice and the number of shares of Common Stock that may be purchased upon conversion of
this Warrant so that, upon the basis and the terms and in the manner provided in this Warrant, the Holder shall be entitled upon
the conversion hereof at any time after the consummation of such Recap Event, to the extent this Warrant is not converted prior
to such Recap Event, to receive at the ExercisePrice in effect at the time immediately prior to the consummation of such Recap
Event, in lieu of the Common Stock issuable upon such conversion of this Warrant prior to such Recap Event, the securities, cash
and property to which such Holder would have been entitled upon the consummation of such Recap Event if such Holder had exercised
the rights represented by this Warrant immediately prior thereto (including the right of a shareholder to elect the type of consideration
it will receive upon a Recap Event), subject to adjustments (subsequent to such corporate action) as nearly equivalent as possible
to the adjustments provided for elsewhere in this Section 3”.

 

2.
Section 3.5 of the Warrant entitled “Adjustment for Sale of Shares Below Exercise Price” is deleted in its
entirety.

 

3. Remainder
of Warrant Unchanged. Except as herein amended, all remaining provisions of the Warrant shall remain in full force and
effect.

 

4. Counterparts.
This Amendment may be executed in one or more counterparts, each of which shall have the same force and effect of the
original.

 

[Signature
Page Follows]

 

    	 

     

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Amendment To Warrant To Purchase Shares to be executed as of the date first
above written.

 

	 	COMPANY:
	 	 	 
	 	HANCOCK JAFFE LABORATORIES, INC.
	 	 	
	 	By:	/s/
    William Abbott
	 	Name:	William
    Abbott
	 	Title:
    	Chief
    Financial Officer

 

	 	HOLDER:
	 	 
	 	[_________________________]

 

	 	By:	 
	 	Name:
    	 
	 	Title:
    	 

 

[Signature
Page to Amendment to Warrant]SECOND
AMENDMENT TO SECURITIES PURCHASE AGREEMENT

 

This
SECOND AMENDMENT TO SECURITIES PURCHASE AGREEMENT (this “Amendment”), dated as of February __, 2018, is by
and among Hancock Jaffe Laboratories, Inc., a Delaware corporation (the “Company”), and the undersigned signatories
hereto (collectively, the “Lenders”), and further amends that certain Securities Purchase Agreement, dated
as of June 15, 2017, as amended on December 29, 2017, by and among the Company and the signatories thereto (the “Purchasers”
and altogether, the “Purchase Agreement”), the Amended and Restated Convertible Notes issued pursuant to the
Purchase Agreement (the “2017 Notes”), and the Amended and Restated Common Stock Purchase Warrants issued pursuant
to the Purchase Agreement (the “2017 Warrants” and, together with the Purchase Agreement and the 2017 Notes,
the “Transaction Documents”). Capitalized terms used but not defined herein shall have the meaning ascribed
to such terms in the Transaction Documents.

 

RECITALS

 

WHEREAS,
the Company and the Lenders desire to amend the Transaction Documents to (i) extend the maturity date of the 2017 Notes to May
15, 2018, and (ii) provide that the number of Warrant Shares exercisable under the 2017 Warrants shall equal 100% of the number
of shares of Common Stock issuable upon conversion of the 2017 Notes;

 

WHEREAS,
pursuant to Section 5.5 of the Purchase Agreement, the Transaction Documents may be amended or the respective terms waived with
the written consent of the Company and the Purchasers holding a majority of the aggregate principal amount of all 2017 Notes issued
under the Purchase Agreement (the “Requisite Holders”); and

 

WHEREAS,
the Company and the undersigned Lenders, constituting the Requisite Holders, desire to amend the Transaction Documents as hereinafter
set forth.

 

AGREEMENT

 

NOW,
THEREFORE, for good and valuable consideration the receipt and sufficiency of which are hereby acknowledged and agreed, the parties
hereby agree as follows:

 

1.
Amendment to Purchase Agreement Section 2.2(a)(iii). Section 2.2(a)(iii) of the Purchase Agreement is hereby amended
and restated in its entirety as follows:

 

“(iii)
a Warrant registered in the name of such Purchaser with an exercise price per share equal to the lesser of (a) $14.40 or (b) 120%
of the Conversion Price, and to purchase up to a number of Common Shares equal to 100% of the number of Common Shares issuable
upon conversion of such Purchaser’s Note.”

 

2.
Amended and Restated Note. In connection and to facilitate the stated intent of the Company and the Lenders in the
recitals, among other things, the parties consent and agree that the 2017 Notes issued to all Purchasers are hereby further amended
and restated, substantially in the form attached hereto as Exhibit A (the “Second Amended and Restated Note”).
The Company shall execute and deliver the Second Amended and Restated Note to each Purchaser.

 

    	 	 	 

    	 

    

 

3.
Amended and Restated Warrant. In connection and to facilitate the stated intent of the Company and the Lenders in the
recitals, among other things, the parties consent and agree that the 2017 Warrants issued to all Purchasers are further hereby
amended and restated substantially in the form attached hereto as Exhibit B (the “Second Amended and Restated
Warrant”). The Company shall execute and deliver the Second Amended and Restated Warrant to each Purchaser.

 

4.
No Other Amendments. Except as herein amended, all provisions of the Transaction Documents shall remain in full force
and effect.

 

5.
Governing Law. This Amendment shall be governed by and construed in accordance with the internal laws of the State
of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any
other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of Delaware.

 

6.
Enforceability. If any provision of this Amendment is held invalid or unenforceable by any court of competent jurisdiction,
the other provisions of this Amendment will remain in full force and effect. Any provision of this Amendment held invalid or unenforceable
only in part or degree will remain in full force and effect to the extent not held invalid or unenforceable.

 

7.
Counterparts. This Amendment may be executed in one or more counterparts, each of which shall have the same force and
effect of the original.

 

[Signature
Page Follows]

 

    	 	 	 

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the date first above written.

 

	 	COMPANY:
	 	 	 
	 	HANCOCK
    JAFFE LABORATORIES, INC.
	 	 	 
	 	By:	 
	 	Name:	William
    R. Abbott            
	 	Title:	Chief
    Financial Officer

 

Signature
Page to Second Amendment to Securities Purchase Agreement

 

    	 	 	 

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the date first above written.

 

	 	LENDER:
	 	 	 
	 	By:	 
	 	Name:	           
	 	Title:	 

 

Signature
Page to Second Amendment to Securities Purchase Agreement

 

    	 	 	 

    	 

    

 

EXHIBIT
A

 

Second
Amended and Restated Note

 

    	 	 	 

    	 

    

 

EXHIBIT
B

 

Second
Amended and Restated WarrantNEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND APPLICABLE STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED
OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF CORPORATE COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF
WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.

 

Original
Issue Date: June 15, 2017

Amended
and Restated: December 29, 2017

Amended
and Restated: February __, 2018

 

$[*]

 

SECOND
AMENDED AND RESTATED CONVERTIBLE NOTE 

 

THIS
SECOND AMENDED AND RESTATED CONVERTIBLE NOTE is one of a series of duly authorized and validly issued Convertible Notes of Hancock
Jaffe Laboratories, Inc, a Delaware corporation company (the “Company”), having its principal place of business
at 70 Doppler Irvine, CA, 92618, (the “Note” and, collectively with the other Notes of such series, the “Notes”).

 

FOR
VALUE RECEIVED, the Company promises to pay to [*] or its registered assigns (the “Holder”), or shall
have paid pursuant to the terms hereunder, the principal sum of $[*] together with interest thereon on May 15, 2018 (the “Maturity
Date”) or such earlier date as this Note is required or permitted to be repaid as provided hereunder. This Note shall
bear interest in accordance with Section 2. This Note is subject to the following additional provisions:

 

Section
1. Definitions. For the purposes hereof, in addition to the terms defined elsewhere in this Note, (a) capitalized terms
not otherwise defined herein shall have the meanings set forth in the Purchase Agreement and (b) the following terms shall have
the following meanings:

 

“Bankruptcy
Event” means any of the following events: (a) the Company or any Significant Subsidiary (as such term is defined in
Rule 1-02(w) of Regulation S-X) thereof commences a case or other proceeding under any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction relating to the
Company or any Significant Subsidiary thereof, (b) there is commenced against the Company or any Significant Subsidiary thereof
any such case or proceeding that is not dismissed within 60 days after commencement, (c) the Company or any Significant Subsidiary
thereof is adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or proceeding is entered,
(d) the Company or any Significant Subsidiary thereof suffers any appointment of any custodian or the like for it or any substantial
part of its property that is not discharged or stayed within 60 calendar days after such appointment, (e) the Company or any Significant
Subsidiary thereof makes a general assignment for the benefit of creditors, (f) the Company or any Significant Subsidiary thereof
calls a meeting of its creditors with a view to arranging a composition, adjustment or restructuring of its debts or (g) the Company
or any Significant Subsidiary thereof, by any act or failure to act, expressly indicates its consent to, approval of or acquiescence
in any of the foregoing or takes any limited liability company or other action for the purpose of effecting any of the foregoing.

 

    	 	1	 

    	 

    

 

“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or
any day on which banking institutions in the State of New York are authorized or required by law or other governmental action
to close.

 

“Buy-In”
shall have the meaning set forth in Section 4(d)(v).

 

“Common
Stock” means shares of the Company’s common stock, par value $0.00001 per share, and any other class of securities
into which such securities may hereafter be reclassified or changed.

 

“Conversion”
shall have the meaning ascribed to such term in Section 4.

 

“Conversion
Date” shall have the meaning set forth in Section 4(a).

 

“Conversion
Price” shall have the meaning set forth in Section 4(c).

 

“Conversion
Shares” means the Common Stock issuable upon conversion of this Note in accordance with the terms hereof.

 

“Event
of Default” shall have the meaning set forth in Section 5(a).

 

“New
York Courts” shall have the meaning set forth in Section 6(d).

 

“Note
Register” shall have the meaning set forth in Section 2(c).

 

“Notice
of Conversion” shall have the meaning set forth in Section 4(a).

 

“Original
Issue Date” means the date of the first issuance of the Notes, regardless of any transfers of any Note and regardless
of the number of instruments which may be issued to evidence such Notes.

 

“Purchase
Agreement” means the Securities Purchase Agreement, dated as of June 15, 2017 among the Company and the investors party
thereto, as amended, modified or supplemented from time to time in accordance with its terms.

 

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

 

    	 	2	 

    	 

    

 

“Share
Delivery Date” means, subject to Section 4(d)(ii), five (5) Business Days after the Conversion Date.

 

“Trading
Day” means a day on which the principal Trading Market is open for trading.

 

“Trading
Market” means any of the following markets or exchanges on which the Company’s Common Stock (or an equivalent
thereof) is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global
Market, the Nasdaq Global Select Market, the New York Stock Exchange, the OTC Bulletin Board or the Pink OTC Markets (or any successors
to any of the foregoing).

 

Section
2. Interest; Prepayment. The Company acknowledges and agrees that this Note shall bear interest at a rate of 15% per annum
to be paid quarterly in cash on each of March 31, June 30, September 30 and December 31; provided, that interest payable on December
31, 2017 shall be due and payable on January 11, 2018. Regularly scheduled interest payments shall be made on this Note. All payments
hereunder will be paid to the Person in whose name this Note is registered on the records of the Company regarding registration
and transfers of this Note (the “Note Register”). At the discretion of the Company, the Principal Amount and
unpaid accrued interest of the Convertible Notes may be prepaid at anytime, provided that written notice is provided to the Holder
at least 15 days in advance of the prepayment.

 

Section
3. Registration of Transfers and Exchanges.

 

a)
Different Denominations. This Note is exchangeable for an equal aggregate principal amount of Notes of different authorized
denominations, as requested by the Holder surrendering the same; provided, that the minimum principal amount of any replacement
Note shall be $50,000. No service charge will be payable for such registration of transfer or exchange.

 

b)
Investment Representations. This Note has been issued subject to certain investment representations of the original Holder
set forth in the Purchase Agreement and may be transferred or exchanged only in compliance with the Purchase Agreement and applicable
federal and state securities laws and regulations to successor Holders who provide the same investment representations to the
Company.

 

c)
Reliance on Note Register. Prior to due presentment for transfer to the Company of this Note, the Company and any agent
of the Company may treat the Person in whose name this Note is duly registered on the Note Register as the owner hereof for the
purpose of receiving payment as herein provided and for all other purposes, whether or not this Note is overdue, and neither the
Company nor any such agent shall be affected by notice to the contrary.

 

Section
4. Conversion.

 

a)
Voluntary Conversion. At any time after the Original Issue Date until this Note is no longer outstanding, the outstanding
principal amount and accrued but unpaid interest on this Note shall be convertible, in whole or in part, into Common Stock at
the option of the Holder, at any time and from time to time. The Holder shall effect conversions by delivering to the Company
a Notice of Conversion, the form of which is attached hereto as Annex A (each, a “Notice of Conversion”),
specifying therein the date on which such conversion shall be effected (such date, the “Conversion Date”).
If no Conversion Date is specified in a Notice of Conversion, the Conversion Date shall be the date that such Notice of Conversion
is deemed delivered hereunder. To effect conversions hereunder, the Holder shall be required to physically surrender this Note
to the Company. The Company may deliver an objection to any Notice of Conversion within two (2) Business Days of delivery of such
Notice of Conversion.

 

    	 	3	 

    	 

    

 

b)
Conversion Price. The Conversion Price in effect on a Conversion Date shall be equal to the lesser of (A) (i) $12.00 or
(B) the product equal to (i) the price per share of Common Stock sold in the Company’s initial public offering (the “IPO”),
multiplied by (ii) 70%. In the event the Company (i) makes a distribution or distributions on Common Stock payable in Common Stock
or any Common Stock Equivalents (which, for avoidance of doubt, shall not include any Common Stock issued by the Company upon
conversion of, or payment of interest on, the Notes), (ii) subdivides outstanding shares of Common Stock into a larger number
of shares of Common Stock, (iii) combines (including by way of a reverse split) outstanding shares of Common Stock into a smaller
number of shares of Common Stock or (iv) issues, in the event of a reclassification of Common Stock, any Common Stock of the Company,
then the Conversion Price shall be adjusted by multiplying the Conversion Price by a fraction of which the numerator shall be
the number of shares of Common Stock outstanding immediately before such event, and of which the denominator shall be the number
of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to this Section shall become
effective immediately after the record date for the determination of members entitled to receive such distribution and shall become
effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

c)
Adjustments for Reorganization, Merger, Consolidation or Sales of Assets. If at any time or from time to time after the
issuance date of this Note there shall be a capital reorganization of the Company (other than by way of a stock split or combination
of shares or stock dividends or distributions, or a reclassification, exchange or substitution of shares), or a merger or consolidation
of the Company with or into another corporation where the holders of the Company’s outstanding voting securities prior to
such merger or consolidation do not own over 50% of the outstanding voting securities of the merged or consolidated entity, immediately
after such merger or consolidation, or the sale of all or substantially all of the Company’s properties or assets to any
other person (an “Organic Change”), then as a part of such Organic Change an appropriate revision to the conversion
price shall be made if necessary and provision shall be made if necessary (by adjustments of the conversion price or otherwise)
so that, upon any subsequent conversion of this Note, the Holder shall have the right to receive, in lieu of Conversion Shares,
the kind and amount of shares of stock and other securities or property of the Company or any successor corporation resulting
from the Organic Change. In any such case, appropriate adjustment shall be made in the application of the provisions of Section
4(a) with respect to the rights of the Holder after the Organic Change to the end that the provisions of Section 4(a) (including
any adjustment in the conversion price then in effect and the number of shares of stock or other securities deliverable upon conversion
of this Note) shall be applied after that event in as nearly an equivalent manner as may be practicable.

 

    	 	4	 

    	 

    

 

d)
Mechanics of Conversion.

 

i.
Conversion Shares Issuable Upon Conversion of Note. The number of Conversion Shares issuable upon a conversion hereunder
shall be determined by the quotient obtained by dividing (x) the outstanding principal amount of this Note to be converted plus
any accrued but unpaid interest by (y) the Conversion Price.

 

ii.
Delivery of Certificate Upon Conversion. The Company shall promptly deliver, or cause to be delivered, to the Holder a
certificate or certificates representing the Conversion Shares representing the number of Conversion Shares being acquired upon
the conversion of this Note, provided, however, provided if the Company’s transfer agent is participating
in the DTC Fast Automated Securities Transfer Program, the Company may credit such aggregate number of shares of Common Stock
to which the Holder shall be entitled pursuant to such conversion to the Holder’s or its designee’s balance account
with DTC through its Deposit/Withdrawal at custodian system.

 

iii.
Failure to Deliver Certificates. If, in the case of a conversion of this Note after the IPO, such certificate or certificates
are not delivered to or as directed by the applicable Holder by the Share Delivery Date, the Holder shall be entitled to elect
by written notice to the Company at any time on or before its receipt of such certificate or certificates, to rescind such Conversion,
in which event the Company shall promptly return to the Holder any original Note delivered to the Company and the Holder shall
promptly return to the Company the Common Stock certificates issued to such Holder pursuant to the rescinded Notice of Conversion.

 

iv.
Obligation Absolute; Partial Liquidated Damages. The Company’s obligations to issue the Conversion Shares upon conversion
of this Note in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the
Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any
Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or
alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law
by the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation of the
Company to the Holder in connection with the issuance of such Conversion Shares; provided, however, that such delivery
shall not operate as a waiver by the Company of any such action the Company may have against the Holder. Nothing herein shall
limit a Holder’s right to pursue actual damages or declare an Event of Default pursuant to Section 5 hereof for the Company’s
failure to deliver Conversion Shares within the period specified herein and the Holder shall have the right to pursue all remedies
available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive
relief. The exercise of any such rights shall not prohibit the Holder from seeking to enforce damages pursuant to any other Section
hereof or under applicable law.

 

    	 	5	 

    	 

    

 

v.
Compensation for Buy-In on Failure to Timely Deliver Certificates Upon Conversion after IPO. In addition to any other rights
available to the Holder, if the Company fails for any reason to deliver to the Holder such certificate or certificates by the
Share Delivery Date pursuant to Section 4(d)(ii), and if after such Share Delivery Date the Holder is required by its brokerage
firm to purchase (in an open market transaction or otherwise), or the Holder’s brokerage firm otherwise purchases, shares
of Common Stock to deliver in satisfaction of a sale by the Holder of the Conversion Shares which the Holder was entitled to receive
upon the conversion relating to such Share Delivery Date (a “Buy-In”), then the Company shall (A) pay in cash
to the Holder (in addition to any other remedies available to or elected by the Holder) the amount, if any, by which (x) the Holder’s
total purchase price (including any brokerage commissions) for the shares of Common Stock so purchased exceeds (y) the product
of (1) the aggregate number of shares of Common Stock that the Holder was entitled to receive from the conversion at issue multiplied
by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage
commissions) and (B) at the option of the Holder, either reissue (if surrendered) this Note in a principal amount equal to the
principal amount of the attempted conversion (in which case such conversion shall be deemed rescinded) or deliver to the Holder
the number of shares of Common Stock that would have been issued if the Company had timely complied with its delivery requirements
under Section 4(d)(ii). For example, if the Holder purchases shares of Common Stock having a total purchase price of $11,000 to
cover a Buy-In with respect to an attempted conversion of this Note with respect to which the actual sale price of the Conversion
Shares (including any brokerage commissions) giving rise to such purchase obligation was a total of $10,000 under clause of the
immediately preceding sentence, the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written
notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the
amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the
Company’s failure to timely deliver certificates representing Common Stock upon conversion of this Note as required pursuant
to the terms hereof.

 

vi.
Fractional Common Stock. No fractional shares of Common Stock shall be issued upon the conversion of this Note. As to any
fraction of a share which the Holder would otherwise be entitled to purchase upon such conversion, the Company shall at its election,
either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion
Price or round up to the next whole share of Common Stock.

 

Section
5. Negative Covenants.

 

Except
as set forth in the Disclosure Schedules and exhibits thereto attached to the Securities Purchase Agreement, as long as at least
33% of the aggregate Principal Amount of the Notes issued pursuant to the Purchase Agreement remains outstanding, the Company
shall not, and shall not permit any of its Subsidiaries to, directly or indirectly:

 

a)
amend its charter documents, including, without limitation, its certificate of incorporation and bylaws, in any manner that materially
and adversely affects any rights of the Holder;

 

b)
pay cash dividends or distributions on any equity securities of the Company;

 

    	 	6	 

    	 

    

 

c)
enter into any transaction with any Affiliate of the Company which would be required to be disclosed in any public filing with
the Securities and Exchange Commission, unless such transaction is made on an arm’s-length basis and expressly approved
by a majority of the disinterested directors of the Company (even if less than a quorum otherwise required for board approval);
or

 

d)
enter into any agreement with respect to any of the foregoing.

 

Section
6. Events of Default.

 

a)
“Event of Default” means, wherever used herein, any of the following events (whatever the reason for such event
and whether such event shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or
order of any court, or any order, rule or regulation of any administrative or governmental body):

 

i.
any default in the payment of (A) the principal amount of any Note or (B) interest, liquidated damages and other amounts owing
to a Holder on any Note, as and when the same shall become due and payable (whether on a Conversion Date or the Maturity Date
or by acceleration or otherwise) which default, solely in the case of an interest payment or other default under clause (B) above,
is not cured within fifteen (15) Trading Days;

 

ii.
the Company shall fail to observe or perform any other material covenant or agreement contained in the Notes which failure is
not cured, if possible to cure, within the earlier to occur of (A) fifteen (15) Trading Days after notice of such failure sent
by the Holder or by any other Holder to the Company and thirty (30) Trading Days after receipt of written notice thereof;

 

iii.
any material representation or warranty made in this Note or any other Transaction Documents shall be untrue or incorrect in any
material respect as of the date when made or deemed made that would cause a Material Adverse Effect;

 

iv.
the Company or any Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) shall be subject to a bankruptcy
event; or

 

v.
following the date the Company initially becomes a reporting company pursuant to the Securities Exchange Act of 1934 and its shares
of Common Stock are listed on a Trading Market, the Common Stock shall subsequently not be eligible for listing or quotation for
trading on a Trading Market and shall not be eligible to resume listing or quotation for trading thereon within ten (10) Trading
Days.

 

b)
Remedies Upon Event of Default. If any Event of Default occurs and is continuing before the Maturity Date, (a) the outstanding
principal amount of this Note, plus liquidated damages, interest and other amounts owing in respect thereof through the date of
acceleration, shall become, at the Holder’s election, immediately due and payable in cash. Upon the payment in full, the
Holder shall promptly surrender this Note to or as directed by the Company. In connection with such acceleration described herein,
the Holder need not provide, and the Company hereby waives, any presentment, demand, protest or other notice of any kind, and
the Holder may immediately and without expiration of any grace period enforce any and all of its rights and remedies hereunder
and all other remedies available to it under applicable law. Such acceleration may be rescinded and annulled by Holder at any
time prior to payment hereunder and the Holder shall have all rights as a holder of the Note until such time, if any, as the Holder
receives full payment pursuant to this Section 5(b). No such rescission or annulment shall affect any subsequent Event of Default
or impair any right consequent thereon. If this Note is placed in the hands of an attorney for collection or enforcement or is
collected or enforced through any legal proceeding or the Holder otherwise takes action to collect amounts due under this Note
or to enforce the provisions of this Note the Company shall be obligated and pay reasonable attorneys’ fees in connection
with such collection, enforcement or action.

 

    	 	7	 

    	 

    

 

Section
7. Miscellaneous.

 

a)
Notices. Any and all notices or other communications or deliveries to be provided by the Holder hereunder, including, without
limitation, any Notice of Conversion, shall be in writing and delivered personally, by e-mail, facsimile, or sent by a nationally
recognized overnight courier service, addressed to the Company, at the address set forth above, or such other e-mail address,
facsimile number or address as the Company may specify for such purposes by notice to the Holder delivered in accordance with
this Section 6(a). Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be
in writing and delivered personally, by e-mail or facsimile, or sent by a nationally recognized overnight courier service addressed
to each Holder at the e-mail address, facsimile number or address of the Holder appearing on the signature pages attached to the
Purchase Agreement. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest
of (i) the date of transmission, if such notice or communication is delivered via e-mail or facsimile at the email address or
facsimile number set forth on the signature pages attached to the Purchase Agreement prior to 5:30 p.m. (New York City time) on
any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via e-mail or
facsimile at the e-mail address or facsimile number set forth on the signature pages attached to the Purchase Agreement on a day
that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following
the date of mailing, if sent by U.S. nationally recognized overnight courier service or (iv) upon actual receipt by the party
to whom such notice is required to be given.

 

b)
Absolute Obligation. Except as expressly provided herein, no provision of this Note shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the principal of, liquidated damages and accrued interest, as applicable,
on this Note at the time, place, and rate, and in the coin or currency, herein prescribed. This Note is a direct debt obligation
of the Company.

 

c)
Lost or Mutilated Note. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver,
in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen
or destroyed Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed, but only upon receipt
of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, reasonably satisfactory to the Company.

 

    	 	8	 

    	 

    

 

d)
Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Note shall be
governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles
of conflict of laws thereof. Each party agrees that all legal proceedings concerning the interpretation, enforcement and defense
of the transactions contemplated by any of the Transaction Documents (whether brought against a party hereto or its respective
Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in the state and federal courts sitting
in the City of New York, Borough of Manhattan (the “New York Courts”). Each party hereto hereby irrevocably
submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction
Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue for
such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence
of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any other manner permitted by applicable law. Each party hereto hereby irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this
Note or the transactions contemplated hereby. If any party shall commence an action or proceeding to enforce any provisions of
this Note, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorney’s
fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.

 

e)
Waiver. Any waiver by the Company or the Holder of a breach of any provision of this Note shall not operate as or be construed
to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the
Company or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered
a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this
Note on any other occasion. Any waiver by the Company or the Holder must be in writing.

 

    	 	9	 

    	 

    

 

f)
Severability. If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain
in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all
other Persons and circumstances. If it shall be found that any interest or other amount deemed interest due hereunder violates
the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the
maximum rate of interest permitted under applicable law. The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law or other law which would prohibit or forgive the Company from paying all or any portion of the principal
of or interest on this Note as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect
the covenants or the performance of this Note, and the Company (to the extent it may lawfully do so) hereby expressly waives all
benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the
execution of any power herein granted to the Holder, but will suffer and permit the execution of every such as though no such
law has been enacted.

 

g)
Next Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day.

 

h)
Headings. The headings contained herein are for convenience only, do not constitute a part of this Note and shall not be
deemed to limit or affect any of the provisions hereof.

 

i)
Amendment. This Note may be modified or amended or the provisions hereof waived in accordance with the Purchase Agreement.
This Note amends and restates in its entirety the Amended and Restated Convertible Note issued to the Holder on December 29, 2017
which is hereby superseded in its entirety by the terms hereof.

 

    	 	10	 

    	 

    

 

 

IN
WITNESS WHEREOF, the Company has caused this Note to be duly executed by a duly authorized officer as of the date first above
indicated.

 

	 	Hancock Jaffe Laboratories, Inc.
	 	 	 
	 	By:	 
	 	Name:	William
    Abbott
	 	Title:	Chief
    Financial Officer

 

    	 	11	 

    	 

    

 

ANNEX
A 

 

NOTICE
OF CONVERSION

 

The
undersigned hereby elects to convert the Convertible Note of Hancock Jaffe Laboratories, Inc., a Delaware corporation (the “Company”),
into Common Stock (the “Common Stock”), of the Company according to the conditions hereof, as of the date written
below. If shares of Common Stock are to be issued in the name of a person other than the undersigned, the undersigned will pay
all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested
by the Company in accordance therewith. No fee will be charged to the holder for any conversion, except for such transfer taxes,
if any.

 

Conversion
calculations: ____________________________________________

 

Date
to Effect Conversion: ___________________________________________

 

Principal
Amount of Note to be Converted: _______________________________

 

Number
of Common Stock to be issued: _________________________________

 

Cash
to be paid to Holder: ___________________________________________

 

Signature: _______________________________________________________

 

Name: __________________________________________________________

 

Address
for Delivery of Common Stock Certificates: _______________________

 

Or

 

DWAC
Instructions: ______________________________________________

 

Broker
No: ______________________________________________________

 

Account
No: ____________________________________________________

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