Document:

Exhibit 10.71

 

Loan Agreement 

 

This Loan Agreement (this “Agreement”)
is entered into by the following parties (the “Parties”) on February 10, 2017:

 

Lender: AMBOW EDUCATION MANAGEMENT
(HONG KONG) LTD

Address: 12/F Ruttonjee House, 11
Duddell Street, Central, HK.

 

Borrowers: Chaio-Ling Hsu

ID card number
: A220920613, Address: No.92, Alley 57, lane 103, Linwulong Street, 23 Neiliaoli , Anle District,
Keelung City ,Taiwan

 

Borrowers: Shuhui Cai

ID card number
: A220737216, Address: No.5, lane 1, Linxin East Street, 2 futaili, Songshan District, Taipei
City,Taiwan

 

(Chiao-Ling Hsu and Shuhui Cai are hereinafter
collectively referred to as “Borrowers”)

 

WHEREAS:

 

(1) Intelligent
Valley Polytron Technologies Inc  (“ Intelligent Valley”) is a enterprise lawfully established under the laws
of Taiwan, with a registered capital of TWD 5 million, of which TWD 3 million is contributed by Chiao-Ling Hsu, representing
60% equity interest in the Company; TWD 2 million is contributed by Shuhui Cai , representing 40% equity interest in the Company;

 

(2) Chiao-Ling Hsu and Shuhui Cai are going
to borrow TWD 3 million and 2 million from Lender , respectively;

 

Through friendly consultations and in the
spirit of equality and mutual benefits, the Parties agree as follows:

 

1. Loan 

 

1.1 Lender agrees to provide a loan to Chiao-Ling
Hsu, the principal of which amounts to TWD 3 million; and to provide a loan to Shuhui Cai, the principal of which
amounts to TWD 2 million (collectively “Loans”).

 

1.2 Borrowers agree to accept the aforementioned
Loans provided to them respectively by Lender and assume responsibilities in connection with their respective share in the Loans.

 

2. Pledge Security 

 

2.1 Borrowers hereby undertake that the Loans
hereunder shall be only used to repay the loans borrowed for purposes of making equity investment in the Company.

 

     

     

    

 

2.2 Without Lender’s prior written consent,
Borrowers shall not use their equity interest in Intelligent Valley to pledge, assume obligations, create any third party interests,
or transfer such equity interest to any third party.

 

3. Repayment 

 

3.1 Borrowers and Lender hereby mutually agree
and confirm that the period of the loan of this agreement is 10 months from the date of activation, and the way of return is made
by the two parties separately

 

3.2 The Parties agree that, subject to the
laws of Taiwan and necessary approvals of the Republic of China government (if applicable), if Borrowers transfer all or part of
their equity interest in the Company to Lender or a third party designated by Lender in accordance with the provisions of the Call
Option Agreement entered into between Borrowers and Lender on the even date herewith (including any amendments thereafter), the
loan that the Borrower shall repay to Lender under this Agreement and is equivalent in amount to the price of the transferred equity
interest (“Price of Transferred Shares”, as defined below) shall be deemed repaid. For the purposes of this Section,
the Price of Transferred Shares shall be calculated as follows: Price of Transferred Shares = Total Amount of Loans x (Number of
Transferred Shares/Total Number of Shares).

 

3.3 Borrowers and Lender hereby mutually agree
and acknowledge that, under any of the following circumstances, Borrowers shall repay the loan immediately:

 

(1) Borrowers are dead, or have no legal capacity
or restricted legal capacity;

 

(2) Borrowers resign or are dismissed from
Lender or an affiliate of Lender;

 

(3) Borrowers commit a crime or are involved
in a crime;

 

(4) Any other third party claims against Borrowers
for payment of any debt above TWD 500,000.

 

4. Representations and Warranties 

 

4.1 Borrowers make the following representations
and warranties to Lender and acknowledge that Lender executes and performs this Agreement in reliance on such representations and
warranties:

 

(1) Borrowers have the right to execute and
perform this Agreement; Borrower’s execution and performance of this Agreement are in compliance with the articles of association
and other constitution documents of Intelligent Valley; Borrowers have obtained all necessary and appropriate approvals and authorizations
to execute and perform this Agreement.

 

(2) Borrowers’ execution and performance
of this Agreement shall not violate any laws, regulations, or government approvals, authorizations, notices or other government
documents which they are subject to or may be affected, nor shall such execution and performance violate any agreements entered
into by Borrowers with any third party or any undertakings made to any third party;

 

(3) Upon execution, this Agreement shall constitute
lawful, valid obligations that may be enforced against Borrowers according to law.

 

     

     

    

 

(4) There is no actual or potential dispute,
lawsuit, arbitration, administrative proceedings or any other legal proceedings relating to the equity interest that Borrowers
holds in Intelligent Valley.

 

4.2 Lender makes the following representations
and warranties to Borrowers:

 

(1) It is a enterprise lawfully established
under the laws of Taiwan

 

(2) It will execute and perform this Agreement
within its corporate power and business scope;

 

(3) it has taken necessary corporate actions
and appropriate authorizations and obtained consents and approvals from third parties and government departments,

 

(4) it will not violate any legal and contractual
restrictions which it is subject to or may be affected;

 

(5) Upon execution, this Agreement shall constitute
lawful, valid and binding obligations that may be enforced against Lender in accordance with the terms hereof.

 

5. Borrowers’ Undertakings 

 

Borrowers undertake that, during the term
of this Agreement, they shall:

 

(1) complete
the establishment of Intelligent Valley registration according to laws of Taiwan before March 20,
2017, and has engaged in the business license within the scope of business and its assets have required all government permission,
authorization, license, registration and filing etc;

 

(2) After
the Intelligence Valley set up is complete, the borrower shall legally hold all the equity intelligence
Valley, which made Chiao-Ling Hsu 60% stake, Shuhui Cai 40% stake, the borrower should produce issued by the accounting firm of
a capital verification report has full payment of capital contributions to the lender;

 

(3) not sell, transfer, pledge or otherwise
dispose of, or allow any other security interest to be created on the equity interest or other interests they hold in Intelligent
Valley other than the equity pledge and other rights created for the benefit of Lender;

 

(4) not vote to agree at any shareholders’
meetings of Intelligent Valley or support or sign any shareholders’ resolutions that approve the sale, transfer, pledge or
disposal of the legal and beneficial interests in the equity interest of Intelligent Valley, or allow any other security interest
to be created on such interests without Lender’s prior written consent, other than to Lender or a person designated by Lender;

 

(5) not vote to agree at any shareholders’
meetings of Intelligent Valley or support or sign any shareholders’ resolutions that approve Intelligent Valley’s merger
or affiliation with any company or the acquisition of or investment in any company without Lender’s prior written consent;

 

(6) notify Lender immediately of any action,
arbitration or administrative proceedings in relation to the equity interest in Domestic Company that have occurred or may occur;

 

     

     

    

 

(7) execute all necessary or proper documents,
take all necessary or proper actions, and bring in all necessary or proper indictments or make necessary or proper defenses against
all claims in order to maintain their ownership of the equity interest in Intelligent Valley;

 

(8) not commit any act or omission that may
significantly affect Intelligent Valley’s assets, business and liabilities without Lender’s prior written consent;

 

(9) appoint any person nominated by Lender
as the Board member of Intelligent Valley at the request of Lender;

 

(10) immediately and unconditionally transfer
all of their equity interest in Intelligent Valley to Lender and/or a person designated by Lender subject to and to the extent
permitted by the PRC laws in the event that Lender exercises the Call Option set forth herein;

 

(11) not request Intelligent Valley to distribute
dividends or profits to them without Lender’s consent;

 

(12) repay Lender all equity transfer proceeds
as the principal of the Loan and the interest or the cost of occupied funds permitted under the laws as soon as they transfer the
equity interest in Domestic Company to Lender or a person designated by Lender; and

 

(13) strictly comply with various provisions
hereof, duly perform all their obligations hereunder, and not commit any act or omission that is sufficient to affect the validity
and enforceability of this Agreement.

 

5.2 Borrowers undertake that, during the term
of this Agreement, as the shareholders of Intelligent Valley, they shall cause Intelligent Valley:

 

(1) not to supplement, alter or modify its
constitutional documents in any way, or increase or decrease its registered capital, or change its capital structure in any way
without Lender’s prior written consent;

 

(2) to maintain its existence in accordance
with good financial and business standards and practice, and operate its business and handle its affairs diligently and efficiently;

 

(3) not to sell, transfer, pledge or otherwise
dispose of its lawful or beneficial interest in any assets, business or income at any time from the date hereof, or allow any other
secure interest to be created on such interest without Lender’s prior written consent;

 

(4) not to incur, assume, guarantee or allow
the existence of any obligations without Lender’s prior written consent, other than (i) any obligations arising during
the ordinary course of business rather than by means of loans and (ii) any obligations that have been disclosed to and approved
by Lender;

 

(5) to operate all its business during the
ordinary course of business all the time to maintain its asset value;

 

(6) not to enter into any material contract
(for the purposes of this paragraph, if a contract’s value is more than RMB 1 million, it shall be deemed as a material
contract) without Lender’s prior written consent except during the ordinary course of business;

 

     

     

    

 

(7) to provide Lender with all information
about its operations and financial conditions at the request of Lender;

 

(8) not to merge or affiliate with any company
or acquire or invest in any company without Lender’s prior written consent;

 

(9) not to distribute dividends to shareholders
without Lender’s prior written consent, and to immediately distribute all of its distributable profits to its shareholders
at the request of Lender;

 

(10) to notify Lender immediately of any action,
arbitration or administrative proceedings in relation to its assets, business and revenue that have occurred or may occur;

 

(11) to execute all necessary or proper documents,
take all necessary or proper actions, and bring in all necessary or proper indictments or make necessary or proper defenses against
all claims in order to maintain its ownership of all of its assets; and

 

(12) to strictly comply with the service agreement
and other agreements entered into with any affiliate of Lender, duly perform all its obligations under the service agreement and
other agreements, and not to commit any act or omission that is sufficient to affect the validity and enforceability of the service
agreement and other agreements.

 

6. Breach 

 

6.1 The borrower directly or indirectly in
violation of this Agreement any obligation or statement and guarantee, such as according to their nature may be corrected, the
lender in writing within a reasonable period of time to correct, but fails to be completed after the receipt of the notification
on about correction within the time limit, constitute a breach of this agreement or not according to their nature as correct, in
the circumstances, constitute a breach of this agreement or.

 

6.2 If the borrower defaults or loan to the
borrower and to claim damages (including but not limited to the actual damage and loss of interest, because the action of criminal
and administrative procedures for civil, expenses and attorney's fees, expenses, and credit and) in accordance with the relevant
provisions of the civil law and other rights.

 

6.3 Where Borrowers fail to repay Lender the
Loans in accordance with this Agreement, Borrowers should pay the interest rate of 20% of the annual interest rate, and shall pay
Lender overdue interest at a daily rate of 0.01% for any loan which is due and payable but has not been repaid.

 

7. Effectiveness and Termination 

 

This Agreement shall come into effect from
the date of execution by the Parties and terminate after Borrowers fully repay the Loans under this Agreement.

 

     

     

    

 

8. Confidentiality 

 

8.1 Either Party agrees to use its best endeavors
to take all reasonable measures to keep confidential all confidential materials and information that is known to or accessed by
it by means of disclosure by the other Party (“Confidential Information”). Without the disclosing Party’s prior
written consent, the receiving Party shall not disclose, give or transfer any such Confidential Information to any third party.
Upon termination of this Agreement, the receiving Party shall return to the disclosing Party or destroy any documents, materials
or software that may contain the Confidential Information at the disclosing Party’s request, and delete any confidential
information from any relevant memory devices, and shall not continue to use such Confidential Information.

 

8.2 The Parties agree that this Section shall
survive regardless of whether this Agreement is altered, terminated or expired.

 

9. Notices 

 

9.1 Any notices or other communications given
by either Party as required hereunder shall be written in Chinese, and sent to the other Party’s address by personal delivery,
or generally accepted courier service or facsimile.

 

9.2 If the notices are sent by personal delivery,
they shall be deemed as effectively given on the date of delivery; if they are sent by facsimile, they shall be deemed as effectively
given on the day following the date of facsimile transmission; if they are sent by courier, they shall be deemed effectively given
on the day shown on the return receipt.

 

10. Governing Law and Dispute Resolution

 

10.1 This Agreement shall be governed by and
construed in accordance with the laws of Taiwan.

 

10.2 If any dispute arises between the Parties
in connection with the interpretation and performance of the terms hereof, the Parties shall negotiate in good faith to resolve
such dispute. If no agreement can be reached, either Party shall have the right to submit such dispute to The Republic of China
Arbitration Association for arbitration in accordance with its then effective rules. The arbitration shall be held in Taipei.

 

10.3 Except the matters in dispute, the Parties
shall continue to perform their respective obligations hereunder in good faith in accordance with the provisions hereof.

 

11. Miscellaneous 

 

11.1 Any amendment and supplement to this
Agreement shall be made by written agreement duly signed by the Parties. Any signed amendment and supplement constitutes a part
of this Agreement and shall have the same force and effect as this Agreement.

 

11.2 Borrowers shall not assign their rights
and obligations hereunder to any third party without Lender’s prior written consent.

 

11.3 If any provisions hereof are deemed unlawful
or unenforceable under applicable laws, such provisions shall be deemed deleted from this Agreement and invalid. However, this
Agreement shall remain effective and shall be deemed not having such provisions from the beginning. The Parties shall discuss with
each other to replace the deleted provisions with lawful and valid provisions that are acceptable to Lender.

 

     

     

    

 

11.4 The headings herein are for convenience
only, and shall not affect the interpretation of any provisions hereof.

 

11.5 Unless otherwise provided herein, either
Party’s failure to exercise or delay in exercising any of its rights or powers hereunder shall not be construed as a waiver
of such rights or powers. Any single or partial exercise of any rights or powers shall not preclude the exercise of other rights
or powers.

 

11.6 This Agreement shall supersede any prior
or concurrent verbal or written agreement, understanding and communication between the Parties in connection with this Agreement.

 

11.7 This agreement is signed by one type
of three copies, each party holds one original.

 

IN WITNESS WHEREOF, the authorized representatives
of the Parties have executed this Agreement on the date first above written.

 

	AMBOW EDUCATION MANAGEMENT (HONG KONG)
    LTD.	 
	 	 	 	 
	Authorized Representative:	/s/	 	 
	 	 	 	 
	Chiao-Ling Hsu	 	 	 
	 	 	 	 
	Signature:	/s/	 	 
	 	 	 	 
	Shuhui Cai	 	 	 
	 	 	 	 	 
	Signature:	/s/Exhibit 10.1

 

SECURITIES PURCHASE AGREEMENT

 

This SECURITIES
PURCHASE AGREEMENT (the “Agreement”), dated as of December 8, 2017, by and between DRONE USA, INC., a Delaware
corporation, with headquarters located at 16 Hamilton Street, West Haven, CT 06516 (the “Company”), and MORNINGVIEW
FINANCIAL, LLC, a Wyoming limited liability company, with its address at 401 Park Ave. South, 10th Floor, New York, NY 10016
(the “Buyer”).

 

WHEREAS:

 

A.             The
Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by the rules and regulations as promulgated by the United States Securities and Exchange Commission (the “SEC”) under
the Securities Act of 1933, as amended (the “1933 Act”);

 

B.             Buyer
desires to purchase and the Company desires to issue and sell, upon the terms and conditions set forth in this Agreement, the 12%
convertible note of the Company, in the form attached hereto as Exhibit A, in the aggregate principal amount of US$82,500.00
(together with any note(s) issued in replacement thereof or as a dividend thereon or otherwise with respect thereto in accordance
with the terms thereof, the “Note”), convertible into shares of common stock of the Company (the “Common Stock”),
upon the terms and subject to the limitations and conditions set forth in such Note; and

 

C.             The
Buyer wishes to purchase, upon the terms and conditions stated in this Agreement, such principal amount of Note as is set forth
immediately below its name on the signature pages hereto.

 

NOW THEREFORE,
the Company and the Buyer severally (and not jointly) hereby agree as follows:

 

1.             PURCHASE
AND SALE OF NOTE.

 

a.           Purchase
of Note. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer agrees to purchase
from the Company such principal amount of Note as is set forth immediately below the Buyer’s name on the signature pages
hereto, subject to the express terms of the Note.

 

b.           Form
of Payment. On or around the Closing Date (as defined below), the Buyer shall pay the purchase price for Note, which is equal
to $75,000.00 (the “Purchase Price”) by wire transfer of immediately available funds, in accordance with the Company’s
written wiring instructions, against delivery of the Note, and (i) the Company shall deliver such duly executed Note on behalf
of the Company, to the Buyer.

 

     

     

    

  

c.           Closing
Date. Subject to the satisfaction (or written waiver) of the conditions thereto set forth in Section 6 and Section 7 below,
the date and time of the issuance and sale of the Note pursuant to this Agreement (the “Closing Date”) shall be 5:00
P.M., Eastern Standard Time on or about December 8, 2017, or such other mutually agreed upon time. The closing of the transactions
contemplated by this Agreement (the “Closing”) shall occur on the Closing Date at such location as may be agreed to
by the parties.

 

2.             REPRESENTATIONS
AND WARRANTIES OF THE BUYER.  The Buyer represents and warrants to the Company that:

 

a.           Investment
Purpose. As of the date hereof, the Buyer is purchasing the Note and the shares of Common Stock issuable upon conversion of
or otherwise pursuant to the Note (including, without limitation, such additional shares of Common Stock, if any, as are issuable
(i) on account of interest on the Note or (ii) as a result of the events described in Sections 1.3 and 1.4(g) of the Note, such
shares of Common Stock being collectively referred to herein as the “Conversion Shares” and, collectively with the
Note, the “Securities”) for its own account and not with a present view towards the public sale or distribution thereof,
except pursuant to sales registered or exempted from registration under the 1933 Act; provided, however, that by
making the representations herein, the Buyer does not agree to hold any of the Securities for any minimum or other specific term
and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an
exemption under the 1933 Act.

 

b.           Reliance
on Exemptions. The Buyer understands that the Securities are being offered and sold to it in reliance upon specific exemptions
from the registration requirements of United States federal and state securities laws and that the Company is relying upon the
truth and accuracy of, and the Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and
understandings of the Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of the
Buyer to acquire the Securities. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation
D (an “Accredited Investor”).

 

c.           Information.
The Buyer and its advisors, if any, have been, and for so long as the Note remain outstanding will continue to be, furnished with
all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of
the Securities which have been requested by the Buyer or its advisors. The Buyer and its advisors, if any, have been, and for so
long as the Note remain outstanding will continue to be, afforded the opportunity to ask questions of the Company. Notwithstanding
the foregoing, the Company has not disclosed to the Buyer any material nonpublic information and will not disclose such information
unless such information is disclosed to the public prior to or promptly following such disclosure to the Buyer. Neither such inquiries
nor any other due diligence investigation conducted by Buyer or any of its advisors or representatives shall modify, amend or affect
Buyer’s right to rely on the Company’s representations and warranties contained in Section 3 below. The Buyer understands
that its investment in the Securities involves a significant degree of risk. The Buyer is not aware of any facts that may
constitute a breach of any of the Company's representations and warranties made herein.

 

    	 	2	 

     

    

 

d.           Governmental
Review. The Buyer understands that no United States federal or state agency or any other government or governmental agency
has passed upon or made any recommendation or endorsement of the Securities.

 

e.           Transfer
or Re-sale. The Buyer understands that (i) the sale or re-sale of the Securities has not been and is not being registered under
the 1933 Act or any applicable state securities laws, and the Securities may not be transferred unless (a) the Securities are sold
pursuant to an effective registration statement under the 1933 Act, (b) the Buyer shall have delivered to the Company, at the cost
of the Buyer, an opinion of counsel that shall be in form, substance and scope customary for opinions of counsel in comparable
transactions to the effect that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption from
such registration, which opinion shall be accepted by the Company, (c) the Securities are sold or transferred to an “affiliate”
(as defined in Rule 144 promulgated under the 1933 Act (or a successor rule) (“Rule 144”)) of the Buyer who agrees
to sell or otherwise transfer the Securities only in accordance with this Section 2(f) and who is an Accredited Investor, (d) the
Securities are sold pursuant to Rule 144, or (e) the Securities are sold pursuant to Regulation S under the 1933 Act (or a successor
rule) (“Regulation S”), and the Buyer shall have delivered to the Company, at the cost of the Buyer, an opinion of
counsel that shall be in form, substance and scope customary for opinions of counsel in corporate transactions, which opinion shall
be accepted by the Company; (ii) any sale of such Securities made in reliance on Rule 144 may be made only in accordance with the
terms of said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances in which the
seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the 1933 Act)
may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder; and (iii)
neither the Company nor any other person is under any obligation to register such Securities under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption thereunder (in each case). Notwithstanding the foregoing or anything
else contained herein to the contrary, the Securities may be pledged as collateral in connection with a bona fide margin
account or other lending arrangement.

 

f.            Legends.
The Buyer understands that the Note and, until such time as the Conversion Shares have been registered under the 1933 Act may be
sold pursuant to Rule 144 or Regulation S without any restriction as to the number of securities as of a particular date that can
then be immediately sold, the Conversion Shares may bear a restrictive legend in substantially the following form (and a stop-transfer
order may be placed against transfer of the certificates for such Securities):

 

    	 	3	 

     

    

 

“NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED
BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
(I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING,
THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.”

 

The legend set forth
above shall be removed and the Company shall issue a certificate without such legend to the holder of any Security upon which it
is stamped, if, unless otherwise required by applicable state securities laws, (a) such Security is registered for sale under an
effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or Regulation S without
any restriction as to the number of securities as of a particular date that can then be immediately sold, or (b) such holder provides
the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions,
to the effect that a public sale or transfer of such Security may be made without registration under the 1933 Act, which opinion
shall be accepted by the Company so that the sale or transfer is effected. The Buyer agrees to sell all Securities, including those
represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements,
if any. In the event that the Company does not accept the opinion of counsel provided by the Buyer with respect to the transfer
of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation S, at the Deadline, it will be considered
an Event of Default pursuant to Section 3.2 of the Note.

 

g.           Authorization;
Enforcement. This Agreement has been duly and validly authorized. This Agreement has been duly executed and delivered on behalf
of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its terms.

 

h.           Residency.
The Buyer is a resident of the jurisdiction set forth immediately below the Buyer’s name on the signature pages hereto.

 

    	 	4	 

     

    

 

 

3.            REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. The Company represents and warrants to the Buyer that:

 

a.           Organization
and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is incorporated, with full power and authority (corporate
and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated
and conducted. Schedule 3(a) sets forth a list of all of the Subsidiaries of the Company and the jurisdiction in which each is
incorporated. The Company and each of its Subsidiaries is duly qualified as a foreign corporation to do business and is in good
standing in every jurisdiction in which its ownership or use of property or the nature of the business conducted by it makes such
qualification necessary except where the failure to be so qualified or in good standing would not have a Material Adverse Effect.
“Material Adverse Effect” means any material adverse effect on the business, operations, assets, financial condition
or prospects of the Company or its Subsidiaries, if any, taken as a whole, or on the transactions contemplated hereby or by the
agreements or instruments to be entered into in connection herewith. “Subsidiaries” means any corporation or other
organization, whether incorporated or unincorporated, in which the Company owns, directly or indirectly, any equity or other ownership
interest.

 

b.           Authorization;
Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the
Note and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the terms
hereof and thereof, (ii) the execution and delivery of this Agreement, the Note by the Company and the consummation by it of the
transactions contemplated hereby and thereby (including without limitation, the issuance of the Note and the issuance and reservation
for issuance of the Conversion Shares issuable upon conversion or exercise thereof) have been duly authorized by the Company’s
Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its shareholders is required,
(iii) this Agreement has been duly executed and delivered by the Company by its authorized representative, and such authorized
representative is the true and official representative with authority to sign this Agreement and the other documents executed in
connection herewith and bind the Company accordingly, and (iv) this Agreement constitutes, and upon execution and delivery by the
Company of the Note, each of such instruments will constitute, a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms.

 

    	 	5	 

     

    

 

c.           Capitalization.
Except as disclosed in the SEC Documents, no shares are reserved for issuance pursuant to the Company’s stock option plans,
no shares are reserved for issuance pursuant to securities (other than the Note) exercisable for, or convertible into or exchangeable
for shares of Common Stock and sufficient shares are reserved for issuance upon conversion of the Note (as required by the Note
and transfer agent share reserve letter). All of such outstanding shares of capital stock are, or upon issuance will be, duly authorized,
validly issued, fully paid and non-assessable. No shares of capital stock of the Company are subject to preemptive rights
or any other similar rights of the shareholders of the Company or any liens or encumbrances imposed through the actions or failure
to act of the Company. Except as disclosed in the SEC Documents, as of the effective date of this Agreement, (i) there are no outstanding
options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, agreements, understandings, claims or
other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for
any shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries
is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries, (ii) there are no
agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or
their securities under the 1933 Act and (iii) there are no anti-dilution or price adjustment provisions contained in any security
issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the issuance of the
Note or the Conversion Shares. The Company has filed in its SEC Documents true and correct copies of the Company’s Certificate
of Incorporation as in effect on the date hereof (“Certificate of Incorporation”), the Company’s By-laws, as
in effect on the date hereof (the “By-laws”), and the terms of all securities convertible into or exercisable for Common
Stock of the Company and the material rights of the holders thereof in respect thereto. The Company shall provide the Buyer with
a written update of this representation signed by the Company’s Chief Executive on behalf of the Company as of the Closing
Date.

 

d.           Issuance
of Shares. The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Note in accordance
with its respective terms, will be validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances
with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the
Company and will not impose personal liability upon the holder thereof.

 

e.           Acknowledgment
of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance
of the Conversion Shares upon conversion of the Note. The Company further acknowledges that its obligation to issue Conversion
Shares upon conversion of the Note in accordance with this Agreement, the Note is absolute and unconditional regardless of the
dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company.

 

    	 	6	 

     

    

 

f.            No
Conflicts. The execution, delivery and performance of this Agreement, the Note by the Company and the consummation by the Company
of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance of
the Conversion Shares) will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation
or By-laws, or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event which
with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration
or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or any of its Subsidiaries
is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and
state securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities
are subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its
Subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations
and violations as would not, individually or in the aggregate, have a Material Adverse Effect). Neither the Company nor any of
its Subsidiaries is in violation of its Certificate of Incorporation, By-laws or other organizational documents and neither the
Company nor any of its Subsidiaries is in default (and no event has occurred which with notice or lapse of time or both could put
the Company or any of its Subsidiaries in default) under, and neither the Company nor any of its Subsidiaries has taken any action
or failed to take any action that would give to others any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party or by which any property or assets
of the Company or any of its Subsidiaries is bound or affected, except for possible defaults as would not, individually or in the
aggregate, have a Material Adverse Effect. The businesses of the Company and its Subsidiaries, if any, are not being conducted,
and shall not be conducted so long as the Buyer owns any of the Securities, in violation of any law, ordinance or regulation of
any governmental entity. Except as specifically contemplated by this Agreement and as required under the 1933 Act and any applicable
state securities laws, the Company is not required to obtain any consent, authorization or order of, or make any filing or registration
with, any court, governmental agency, regulatory agency, self-regulatory organization or stock market or any third party in order
for it to execute, deliver or perform any of its obligations under this Agreement, the Note in accordance with the terms hereof
or thereof or to issue and sell the Note in accordance with the terms hereof and to issue the Conversion Shares upon conversion
of the Note. All consents, authorizations, orders, filings and registrations which the Company is required to obtain pursuant to
the preceding sentence have been obtained or effected on or prior to the date hereof. The Company is not in violation of the listing
requirements of the Over-the- Counter Bulletin Board (the “OTCBB”), the OTCQB or any similar quotation system, and
does not reasonably anticipate that the Common Stock will be delisted by the OTCBB, the OTCQB or any similar quotation system,
in the foreseeable future. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to
any of the foregoing.

 

    	 	7	 

     

    

 

g.           SEC
Documents; Financial Statements. The Company has timely filed all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended
(the “1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial
statements and schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being
hereinafter referred to herein as the “SEC Documents”). The Company has delivered to the Buyer true and complete copies
of the SEC Documents, except for such exhibits and incorporated documents. As of their respective dates, the SEC Documents complied
in all material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were made, not misleading. None of the statements made
in any such SEC Documents is, or has been, required to be amended or updated under applicable law (except for such statements as
have been amended or updated in subsequent filings prior the date hereof). As of their respective dates, the financial statements
of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements
and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance
with United States generally accepted accounting principles, consistently applied, during the periods involved and fairly present
in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof
and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments). Except as set forth in the financial statements of the Company included in the SEC Documents,
the Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business,
and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally
accepted accounting principles to be reflected in such financial statements, which, individually or in the aggregate, are not material
to the financial condition or operating results of the Company. The Company is subject to the reporting requirements of the 1934
Act. For the avoidance of doubt, filing of the documents required in this Section 3(g) via the SEC’s Electronic Data Gathering,
Analysis, and Retrieval system (“EDGAR”) shall satisfy all delivery requirements of this Section 3(g).

 

h.           Absence
of Certain Changes. There have been no material adverse change and no material adverse development in the assets, liabilities,
business, properties, operations, financial condition, results of operations, prospects or 1934 Act reporting status of the Company
or any of its Subsidiaries.

 

i.            Absence
of Litigation. There is no action, suit, claim, proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries,
threatened against or affecting the Company or any of its Subsidiaries, or their officers or directors in their capacity as such,
that could have a Material Adverse Effect. Schedule 3(i) contains a complete list and summary description of any pending or, to
the knowledge of the Company, threatened proceeding against or affecting the Company or any of its Subsidiaries, without regard
to whether it would have a Material Adverse Effect. The Company and its Subsidiaries are unaware of any facts or circumstances
which might give rise to any of the foregoing.

 

    	 	8	 

     

    

 

j.            Patents,
Copyrights, etc. The Company and each of its Subsidiaries owns or possesses the requisite licenses or rights to use all patents,
patent applications, patent rights, inventions, know-how, trade secrets, trademarks, trademark applications, service marks, service
names, trade names and copyrights (“Intellectual Property”) necessary to enable it to conduct its business as
now operated (and, as presently contemplated to be operated in the future); Except as disclosed in the SEC Documents, there is
no claim or action by any person pertaining to, or proceeding pending, or to the Company’s knowledge threatened, which challenges
the right of the Company or of a Subsidiary with respect to any Intellectual Property necessary to enable it to conduct its business
as now operated (and, as presently contemplated to be operated in the future); to the best of the Company’s knowledge, the
Company’s or its Subsidiaries’ current and intended products, services and processes do not infringe on any Intellectual
Property or other rights held by any person; and the Company is unaware of any facts or circumstances which might give rise to
any of the foregoing. The Company and each of its Subsidiaries have taken reasonable security measures to protect the secrecy,
confidentiality and value of their Intellectual Property.

 

k.          No
Materially Adverse Contracts, Etc. Neither the Company nor any of its Subsidiaries is subject to any charter, corporate or
other legal restriction, or any judgment, decree, order, rule or regulation which in the judgment of the Company’s officers
has or is expected in the future to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries is a party
to any contract or agreement which in the judgment of the Company’s officers has or is expected to have a Material Adverse
Effect.

 

l.            Tax
Status. The Company and each of its Subsidiaries has made or filed all federal, state and foreign income and all other tax
returns, reports and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company
and each of its Subsidiaries has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported
taxes) and has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to
be due on such returns, reports and declarations, except those being contested in good faith and has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the
officers of the Company know of no basis for any such claim. The Company has not executed a waiver with respect to the statute
of limitations relating to the assessment or collection of any foreign, federal, state or local tax. None of the Company’s
tax returns is presently being audited by any taxing authority.

 

m.           Certain
Transactions. Except for arm’s length transactions pursuant to which the Company or any of its Subsidiaries makes payments
in the ordinary course of business upon terms no less favorable than the Company or any of its Subsidiaries could obtain from third
parties and other than the grant of stock options disclosed on Schedule 3(c), none of the officers, directors, or employees of
the Company is presently a party to any transaction with the Company or any of its Subsidiaries (other than for services as employees,
officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director
or such employee or, to the knowledge of the Company, any corporation, partnership, trust or other entity in which any officer,
director, or any such employee has a substantial interest or is an officer, director, trustee or partner.

 

    	 	9	 

     

    

 

n.           Disclosure.
All information relating to or concerning the Company or any of its Subsidiaries set forth in this Agreement and provided to the
Buyer pursuant to Section 2(d) hereof and otherwise in connection with the transactions contemplated hereby is true and correct
in all material respects and the Company has not omitted to state any material fact necessary in order to make the statements made
herein or therein, in light of the circumstances under which they were made, not misleading. No event or circumstance has occurred
or exists with respect to the Company or any of its Subsidiaries or its or their business, properties, prospects, operations or
financial conditions, which, under applicable law, rule or regulation, requires public disclosure or announcement by the Company
but which has not been so publicly announced or disclosed (assuming for this purpose that the Company’s reports filed under
the 1934 Act are being incorporated into an effective registration statement filed by the Company under the 1933 Act).

 

o.           Acknowledgment
Regarding Buyer’ Purchase of Securities. The Company acknowledges and agrees that the Buyer is acting solely in the capacity
of arm’s length purchasers with respect to this Agreement and the transactions contemplated hereby. The Company further acknowledges
that the Buyer is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to this
Agreement and the transactions contemplated hereby and any statement made by the Buyer or any of its respective representatives
or agents in connection with this Agreement and the transactions contemplated hereby is not advice or a recommendation and is merely
incidental to the Buyer’ purchase of the Securities. The Company further represents to the Buyer that the Company’s
decision to enter into this Agreement has been based solely on the independent evaluation of the Company and its representatives.

 

p.           No
Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly
or indirectly made any offers or sales in any security or solicited any offers to buy any security under circumstances that would
require registration under the 1933 Act of the issuance of the Securities to the Buyer. The issuance of the Securities to the Buyer
will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes of any
shareholder approval provisions applicable to the Company or its securities.

 

q.           No
Brokers. The Company has taken no action which would give rise to any claim by any person for brokerage commissions, transaction
fees or similar payments relating to this Agreement or the transactions contemplated hereby.

 

    	 	10	 

     

    

 

 

r.            Permits;
Compliance. The Company and each of its Subsidiaries is in possession of all franchises, grants, authorizations, licenses,
permits, easements, variances, exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its
properties and to carry on its business as it is now being conducted (collectively, the “Company Permits”),
and there is no action pending or, to the knowledge of the Company, threatened regarding suspension or cancellation of any of the
Company Permits. Neither the Company nor any of its Subsidiaries is in conflict with, or in default or violation of, any of the
Company Permits, except for any such conflicts, defaults or violations which, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries has received any notification with
respect to possible conflicts, defaults or violations of applicable laws, except for notices relating to possible conflicts, defaults
or violations, which conflicts, defaults or violations would not have a Material Adverse Effect.

 

s.           Environmental
Matters.

 

(i)          There
are, to the Company’s knowledge, with respect to the Company or any of its Subsidiaries or any predecessor of the Company,
no past or present violations of Environmental Laws (as defined below), releases of any material into the environment, actions,
activities, circumstances, conditions, events, incidents, or contractual obligations which may give rise to any common law environmental
liability or any liability under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 or similar federal,
state, local or foreign laws and neither the Company nor any of its Subsidiaries has received any notice with respect to any of
the foregoing, nor is any action pending or, to the Company’s knowledge, threatened in connection with any of the foregoing.
The term “Environmental Laws” means all federal, state, local or foreign laws relating to pollution or protection of
human health or the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface
strata), including, without limitation, laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants
contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment,
or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials, as well as all authorizations, codes, decrees, demands or demand letters, injunctions, judgments, licenses,
notices or notice letters, orders, permits, plans or regulations issued, entered, promulgated or approved thereunder.

 

(ii)         Other
than those that are or were stored, used or disposed of in compliance with applicable law, no Hazardous Materials are contained
on or about any real property currently owned, leased or used by the Company or any of its Subsidiaries, and no Hazardous Materials
were released on or about any real property previously owned, leased or used by the Company or any of its Subsidiaries during the
period the property was owned, leased or used by the Company or any of its Subsidiaries, except in the normal course of the Company’s
or any of its Subsidiaries’ business.

 

    	 	11	 

     

    

 

 

(iii)        There
are no underground storage tanks on or under any real property owned, leased or used by the Company or any of its Subsidiaries
that are not in compliance with applicable law.

 

t.            Title
to Property. Except as disclosed in the SEC Documents the Company and its Subsidiaries have good and marketable title in fee
simple to all real property and good and marketable title to all personal property owned by them which is material to the business
of the Company and its Subsidiaries, in each case free and clear of all liens, encumbrances and defects or such as would not have
a Material Adverse Effect. Any real property and facilities held under lease by the Company and its Subsidiaries are held by them
under valid, subsisting and enforceable leases with such exceptions as would not have a Material Adverse Effect.

 

u.           Internal
Accounting Controls. Except as disclosed in the SEC Documents the Company and each of its Subsidiaries maintain a system of
internal accounting controls sufficient, in the judgment of the Company’s board of directors, to provide reasonable assurance
that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions
are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles
and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or
specific authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.

 

v.           Foreign
Corrupt Practices. Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other person
acting on behalf of the Company or any Subsidiary has, in the course of his actions for, or on behalf of, the Company, used any
corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; made
any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; violated
or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

 

w.          Solvency.
The Company (after giving effect to the transactions contemplated by this Agreement) is solvent (i.e., its assets have a
fair market value in excess of the amount required to pay its probable liabilities on its existing debts as they become absolute
and matured) and currently the Company has no information that would lead it to reasonably conclude that the Company would not,
after giving effect to the transaction contemplated by this Agreement, have the ability to, nor does it intend to take any action
that would impair its ability to, pay its debts from time to time incurred in connection therewith as such debts mature. The Company
did not receive a qualified opinion from its auditors with respect to its most recent fiscal year end and, after giving effect
to the transactions contemplated by this Agreement, does not anticipate or know of any basis upon which its auditors might
issue a qualified opinion in respect of its current fiscal year. For the avoidance of doubt any disclosure of the Borrower’s
ability to continue as a “going concern” shall not, by itself, be a violation of this Section 3(w).

 

    	 	12	 

     

    

 

x.           No
Investment Company. The Company is not, and upon the issuance and sale of the Securities as contemplated by this Agreement
will not be an “investment company” required to be registered under the Investment Company Act of 1940 (an “Investment
Company”). The Company is not controlled by an Investment Company.

 

y.           Insurance.
Upon written request the Company will provide to the Buyer true and correct copies of all policies relating to directors’
and officers’ liability coverage, errors and omissions coverage, and commercial general liability coverage, if any.

 

z.            Bad
Actor. No officer or director of the Company would be disqualified under Rule 506(d) of the Securities Act as amended on the
basis of being a "bad actor" as that term is established in the September 19, 2013 Small Entity Compliance Guide published
by the Securities and Exchange Commission.

 

aa.         Breach
of Representations and Warranties by the Company. If the Company breaches any of the representations or warranties set forth
in this Section 3, and in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered
an Event of default under Section 3.4 of the Note.

 

4.             COVENANTS.

 

a.           Best
Efforts. The parties shall use their commercially reasonable best efforts to satisfy timely each of the conditions described
in Section 6 and 7 of this Agreement.

 

b.           Use
of Proceeds. The Company shall use the proceeds from the sale of the Note for working capital and other general corporate purposes
and shall not, directly or indirectly, use such proceeds for any loan to or investment in any other corporation, partnership, enterprise
or other person (except in connection with its currently existing direct or indirect Subsidiaries).

 

c.           Financial
Information. The Company agrees to send or make available the following reports to the Buyer until the Buyer transfers,
assigns, or sells all of the Securities: (i) within ten (10) days after the filing with the SEC, a copy of its Annual Report
on Form 10-K its Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K; (ii) within one (1) day after release,
copies of all press releases issued by the Company or any of its Subsidiaries; and (iii) contemporaneously with the making
available or giving to the shareholders of the Company, copies of any notices or other information the Company makes
available or gives to such shareholders. For the avoidance of doubt, filing the documents required in (i) above via EDGAR or
releasing any documents set forth in (ii) above via a recognized wire service shall satisfy the delivery requirements of this
Section 4(f).

 

    	 	13	 

     

    

 

d.           Listing.
The Company shall promptly secure the listing of the Conversion Shares upon each national securities exchange or automated quotation
system, if any, upon which shares of Common Stock are then listed (subject to official notice of issuance) and, so long
as the Buyer owns any of the Securities, shall maintain, so long as any other shares of Common Stock shall be so listed, such listing
of all Conversion Shares from time to time issuable upon conversion of the Note. The Company will obtain and, so long as the Buyer
owns any of the Securities, maintain the listing and trading of its Common Stock on the OTCBB, OTCQB, OTC Pink or any equivalent
replacement exchange, the Nasdaq National Market (“Nasdaq”), the Nasdaq SmallCap Market (“Nasdaq SmallCap”),
the New York Stock Exchange (“NYSE”), or the NYSE MKT and will comply in all respects with the Company’s reporting,
filing and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”) and
such exchanges, as applicable. The Company shall promptly provide to the Buyer copies of any material notices it receives from
the OTCBB, OTCQB and any other exchanges or quotation systems on which the Common Stock is then listed regarding the continued
eligibility of the Common Stock for listing on such exchanges and quotation systems.

 

e.           Corporate
Existence. So long as the Buyer beneficially owns any Note, the Company shall maintain its corporate existence and shall not sell
all or substantially all of the Company’s assets, except in the event of a merger or consolidation or sale of all or substantially
all of the Company’s assets, where the surviving or successor entity in such transaction (i) assumes the Company’s
obligations hereunder and under the agreements and instruments entered into in connection herewith and (ii) is a publicly traded
corporation whose Common Stock is listed for trading on the OTCBB, OTCQB, OTC Pink, Nasdaq, NasdaqSmallCap, NYSE or AMEX.

 

f.            No
Integration. The Company shall not make any offers or sales of any security (other than the Securities) under circumstances
that would require registration of the Securities being offered or sold hereunder under the 1933 Act or cause the offering of the
Securities to be integrated with any other offering of securities by the Company for the purpose of any stockholder approval provision
applicable to the Company or its securities.

 

g.           Failure
to Comply with the 1934 Act. So long as the Buyer beneficially owns the Note, the Company shall comply with the reporting requirements
of the 1934 Act; and the Company shall continue to be subject to the reporting requirements of the 1934 Act.

 

h.           Trading
Activities. Neither the Buyer nor its affiliates has an open short position (or other hedging or similar transactions) in the
common stock of the Company and the Buyer agree that it shall not, and that it will cause its affiliates not to, engage in any
short sales of or hedging transactions with respect to the common stock of the Company.

 

i.            Breach
of Covenants. If the Company breaches any of the covenants set forth in this Section 4, and in addition to any other remedies
available to the Buyer pursuant to this Agreement, it will be considered an event of default under Section 3.3 of the Note.

 

    	 	14	 

     

    

 

5.            Transfer
Agent Instructions. Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares
may be sold pursuant to Rule 144 without any restriction as to the number of Securities as of a particular date that can then be
immediately sold, all such certificates shall bear the restrictive legend specified in Section 2(g) of this Agreement. The Company
warrants that: (i) no stop transfer instructions to give effect to Section 2(f) hereof (in the case of the Conversion Shares, prior
to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to
Rule 144 without any restriction as to the number of Securities as of a particular date that can then be immediately sold), will
be given by the Company to its transfer agent and that the Securities shall otherwise be freely transferable on the books and records
of the Company as and to the extent provided in this Agreement and the Note; (ii) it will not direct its transfer agent not to
transfer or delay, impair, and/or hinder its transfer agent in transferring (or issuing) (electronically or in certificated form)
any certificate for Conversion Shares to be issued to the Buyer upon conversion of or otherwise pursuant to the Note as and when
required by the Note and this Agreement; and (iii) it will not fail to remove (or directs its transfer agent not to remove or impairs,
delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions
in respect thereof) on any certificate for any Conversion Shares issued to the Buyer upon conversion of or otherwise pursuant to
the Note as and when required by the Note and this Agreement. Nothing in this Section shall affect in any way the Buyer’s
obligations and agreement set forth in Section 2(g) hereof to comply with all applicable prospectus delivery requirements, if any,
upon re-sale of the Securities. If the Buyer provides the Company, at the cost of the Buyer, with (i) an opinion of counsel in
form, substance and scope customary for opinions in comparable transactions, to the effect that a public sale or transfer of such
Securities may be made without registration under the 1933 Act and such sale or transfer is effected or (ii) the Buyer provides
reasonable assurances that the Securities can be sold pursuant to Rule 144, the Company shall permit the transfer, and, in the
case of the Conversion Shares, promptly instruct its transfer agent to issue one or more certificates, free from restrictive legend,
in such name and in such denominations as specified by the Buyer. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby.
Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Section may be inadequate
and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall
be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate transfer,
without the necessity of showing economic loss and without any bond or other security being required.

 

6.            
CONDITIONS PRECEDENT TO THE COMPANY’S OBLIGATIONS TO SELL. The obligation of the Company hereunder to issue and sell
the Note to the Buyer at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions
thereto, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in
its sole discretion:

 

    	 	15	 

     

    

 

a.           The
Buyer shall have executed this Agreement and delivered the same to the Company.

 

b.           The
Buyer shall have delivered the Purchase Price in accordance with Section 1(b) above.

 

c.           The
representations and warranties of the Buyer shall be true and correct in all material respects as of the date when made and as
of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date), and
the Buyer shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required
by this Agreement to be performed, satisfied or complied with by the Buyer at or prior to the Closing Date.

 

d.           No
litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority
over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

7.            
CONDITIONS PRECEDENT TO THE BUYER’S OBLIGATION TO PURCHASE. The obligation of the Buyer hereunder to purchase the
Note at the Closing is subject to the satisfaction, at or before the Closing Date of each of the following conditions, provided
that these conditions are for the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:

 

a.           The
Company shall have executed this Agreement and delivered the same to the Buyer.

 

b.           The
Company shall have delivered to the Buyer duly executed Note (in such denominations as the Buyer shall request) in accordance with
Section 1(b) above.

 

c.           The
representations and warranties of the Company shall be true and correct in all material respects as of the date when made and as
of the Closing Date as though made at such time (except for representations and warranties that speak as of a specific date) and
the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the Closing Date. The Buyer
shall have received a certificate or certificates, executed by the chief executive officer of the Company, dated as of the Closing
Date, to the foregoing effect and as to such other matters as may be reasonably requested by the Buyer including, but not limited
to certificates with respect to the Company’s Certificate of Incorporation, By-laws and Board of Directors’ resolutions
relating to the transactions contemplated hereby.

 

    	 	16	 

     

    

 

 

d.           No
litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated
or endorsed by or in any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority
over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by this Agreement.

 

e.           No
event shall have occurred which could reasonably be expected to have a Material Adverse Effect on the Company including but not
limited to a change in the 1934 Act reporting status of the Company or the failure of the Company to be timely in its 1934 Act
reporting obligations.

 

f.            The
Conversion Shares shall have been authorized for quotation on the OTCBB, OTCQB or any similar quotation system and trading in the
Common Stock on the OTCBB, OTCQB or any similar quotation system shall not have been suspended by the SEC or the OTCBB, OTCQB or
any similar quotation system.

 

g.           The
Buyer shall have received an officer’s certificate described in Section 3(c) above, dated as of the Closing Date.

 

8.            GOVERNING
LAW; MISCELLANEOUS.

 

a.            Governing
Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada without regard to
principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated
by this Agreement shall be brought only in the state courts of New York or in the federal courts located in the state of New York.
The parties to this Agreement hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder
and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Company
and Buyer waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney's
fees and costs. In the event that any provision of this Agreement or any other agreement delivered in connection herewith is invalid
or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that
it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may
prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement.
Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding
in connection with this Agreement or any other Transaction Document 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 Agreement
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 law.

 

    	 	17	 

     

    

  

b.           Counterparts;
Signatures by Facsimile. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original
but all of which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party. This Agreement, once executed by a party, may be delivered to the other party hereto by
facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.

 

c.           Headings.
The headings of this Agreement are for convenience of reference only and shall not form part of, or affect the interpretation of,
this Agreement.

 

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

 

e.           Entire
Agreement; Amendments. This Agreement and the instruments referenced herein contain the entire understanding of the parties
with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company
nor the Buyer makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement
may be waived or amended other than by an instrument in writing signed by the majority in interest of the Buyer.

 

f.            Notices.
All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing
and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted
by hand delivery, telegram, facsimile, or electronic mail, addressed as set forth below or to such other address as such party
shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder
shall be deemed effective (a) upon hand delivery or delivery by facsimile or electronic mail, at the address or number designated
below (if delivered on a business day during normal business hours where such notice is to be received), or the first business
day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be
received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed
to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall
be:

  

    	 	18	 

     

    

  

If to the Company, to:

 

DRONE USA, INC.

16 Hamilton Street

West Haven, CT 06516

e-mail: grant@droneusainc.com

 

If to the Holder, to:

 

MORNINGVIEW FINANCIAL, LLC

401 Park Ave. South, 10th

Floor New York, NY 10016

e-mail: max@morningviewfn.com

 

Each party shall provide notice to the other party of any change
in address.

 

g.           Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns.
Neither the Company nor the Buyer shall assign this Agreement or any rights or obligations hereunder without the prior written
consent of the other. Notwithstanding the foregoing, subject to Section 2(f), the Buyer may assign its rights hereunder to any
person that purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term
is defined under the 1934 Act, without the consent of the Company.

 

h.           Third
Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors
and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

 

i.            Survival.
The representations and warranties of the Company and the agreements and covenants set forth in this Agreement shall survive the
closing hereunder. The Company agrees to indemnify and hold harmless the Buyer and all their officers, directors, employees and
agents for loss or damage arising as a result of or related to any breach by the Company of any of its representations, warranties
and covenants set forth in this Agreement or any of its covenants and obligations under this Agreement, including advancement of
expenses as they are incurred.

 

j.            Further
Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request
in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated
hereby.

 

    	 	19	 

     

    

  

k.           No
Strict Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.

 

l.            Remedies.

 

(i)          The
Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by vitiating the
intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach
of its obligations under this Agreement will be inadequate and agrees, in the event of a breach or threatened breach by the Company
of the provisions of this Agreement, that the Buyer shall be entitled, in addition to all other available remedies at law or in
equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any
breach of this Agreement and to enforce specifically the terms and provisions hereof, without the necessity of showing economic
loss and without any bond or other security being required.

 

(ii)         In
addition to any other remedy provided herein or in any document executed in connection herewith, Borrower shall pay Holder for
all costs, fees and expenses in connection with any litigation, contest, dispute, suit or any other action to enforce any rights
of Holder against Borrower in connection herewith, including, but not limited to, costs and expenses and attorneys' fees, and costs
and time charges of counsel to Holder. In furtherance of the foregoing, Borrower shall pay an amount equal to $25,000 to the Holder
immediately upon the Holder’s filing of any litigation, contest, dispute, suit or any other action to enforce any rights
of Holder against Borrower in connection herewith, which such amount shall be used to pay Holder’s attorneys’ fees,
cost and expenses. Additional amounts shall be paid by Borrower to Holder immediately upon Borrower’s receipt of invoices
from Holder’s attorney evidencing the charges and fees assessed in connection with any such litigation, contest, dispute,
suit or any other action to enforce any rights of Holder and, upon receiving such invoices which indicate outstanding fees in excess
of $20,000 at any time, Borrower shall promptly pay an additional $25,000 to Holder to be used in satisfaction of additional attorneys’
fees, and costs and time charges of counsel to Holder. Such payments shall continue indefinitely until said litigation, contest,
dispute, suit or any other action to enforce any rights of Holder against Borrower is settled to the satisfaction of the Holder.
Further, Borrower agrees to save and hold Holder harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such costs and expenses.

 

m.          Publicity.
The Company, and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC,
OTCQB (or other applicable trading market), or FINRA filings, or any other public statements with respect to the transactions contemplated
hereby; provided, however, that the Company shall be entitled, without the prior approval of the Buyer, to make any
press release or SEC, OTCQB (or other applicable trading market) or FINRA filings with respect to such transactions as is required
by applicable law and regulations (although the Buyer shall be consulted by the Company in connection with any such press
release prior to its release and shall be provided with a copy thereof).

 

[ - signature page follows - ]

 

    	 	20	 

     

    

 

 

IN WITNESS WHEREOF, the undersigned Buyer
and the Company have caused this Agreement to be duly executed as of the date first above written.

 

	DRONE USA, INC.	 
	 	 	 
	By:	/s/ Michael Bannon	 
	Name:	Michael Bannon	 
	Title:	Chief Executive Officer	 
	 	 	 
	MORNINGVIEW FINANCIAL, LLC	 
	 	 	 
	By:	/s/ Max Riccio	 
	Name: 	Max Riccio	 
	Title: 	Authorized Signatory	 

 

	AGGREGATE SUBSCRIPTION AMOUNT:	 	 
	 	 	 	 
	Aggregate Principal Amount of Note:	 	US$82,500.00	 
	 	 	 	 
	Aggregate Purchase Price:	 	US$75,000.00	*

 

*The $75,000.00 purchase price shall be paid within a reasonable
amount of time after the full execution of the Note and all related transaction documentation.

 

    	 	21

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