Document:

Exhibit
10.1

 

SECURITIES
PURCHASE AGREEMENT

 

This
SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of April 1, 2022, by and between SIMPLICITY ESPORTS AND
GAMING COMPANY, a Delaware corporation, with headquarters located at 7000 West Palmetto Park Road, Suite 505, Boca Raton, Florida 33433
(the “Company”), and Jefferson Street Capital LLC, a New Jersey limited liability company with an address at 720 Monroe Street, Suite
C401B, Hoboken, New Jersey 07030 (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 Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”) and Rule 506(b) promulgated by
the United States Securities and Exchange Commission (the “SEC”) under the 1933 Act;

 

B. Buyer
desires to purchase from the Company, and the Company desires to issue and sell to the Buyer, upon the terms and conditions set forth
in this Agreement, a Convertible Promissory Note of the Company, in the aggregate principal amount of $82,500.00 (as the principal amount
thereof may be increased pursuant to the terms thereof, and 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, in the form attached hereto as Exhibit A (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;

 

C.
To induce the Buyer to enter into the transactions contemplated hereby, the Company is also issuing to Buyer a common stock purchase
warrant in accordance with the terms thereof, in the form attached hereto as Exhibit B (the “Warrant”)
exercisable for shares of Common Stock upon the terms and subject to the limitations and conditions set forth in such Warrant, as
well as seven hundred and three (703) shares of Common Stock (the “Commitment Shares”) at the Closing (as defined
below);

 

NOW
THEREFORE, in consideration of the foregoing and of the agreements and covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Buyer hereby agree as follows:

 

 1. Purchase and Sale of the Securities.

 

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 the Note, subject to the terms of the Note and this Agreement as the case may be.

 

b. Warrant.
On the Closing Date, the Company shall issue to Buyer the Warrant, subject to the terms of the Warrant and this Agreement as the case
may be.

 

c. Commitment
Shares. Upon the Closing, the Company shall cause the Commitment Shares to be issued in book-entry form in the name of the Buyer.

 

d. Form
of Payment. On the Closing Date, the Buyer shall pay the purchase price of $75,000 (the “Purchase Price”) for the Note,
by wire transfer of immediately available funds, in accordance with the Company’s written wiring instructions, against delivery
of the Note, the Warrant and the Commitment Shares, and the Company shall deliver such duly executed Note and Warrant on behalf of the
Company, to the Buyer.

 

    	 

     

    

 

e. Closing
Date. Subject to the satisfaction (or written waiver) of the conditions set forth in Section 6 and Section 7 below, the date and
time of the issuance and sale of the Note, the Warrant and the Commitment Shares pursuant to this Agreement (the “Closing Date”)
shall be 4:00 PM, Eastern Time on the date first written above, or such other mutually agreed upon time.

 

f. Closing.
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 (including via exchange of electronic signatures).

 

2. Buyer’s
Representations and Warranties. The Buyer represents and warrants to the Company as of the Closing Date that:

 

a. Investment
Purpose. As of the Closing Date, the Buyer is purchasing the Note and the Warrant, the Commitment Shares and the shares of Common
Stock issuable upon conversion or exercise thereof, or otherwise issued pursuant to the Note or Warrant and such additional shares of
Common Stock, if any, as are issuable on account of interest on the Note pursuant to this Agreement, such shares of Common Stock being
collectively referred to herein as the “Conversion Shares” and, collectively with the Note, the Commitment Shares, and the
Warrant, 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. Accredited
Investor Status. The Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D (an “Accredited
Investor”).

 

c. 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.

 

d. Information.
The Buyer and its advisors, if any, have been 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 afforded the opportunity to ask questions of the Company regarding its business and affairs.
Notwithstanding the foregoing, the Company has not disclosed to the Buyer any material nonpublic information regarding the Company or
otherwise, 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.

 

e. 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.

 

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f. Transfer
or Resale. Without limiting any of the Company’s obligations hereunder, the Buyer understands that (i) the sale or resale of
the Securities have not been, and as of the date hereof, are currently 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 Company, an opinion of counsel (which may be
the Legal Counsel Opinion (as defined below)) 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 other applicable exemption and the Buyer shall have delivered to the Company, at the cost of the Company,
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 resale 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).

 

g. Legends.
The Buyer understands that until such time as the Securities have been registered under the 1933 Act or may be sold pursuant to any
applicable exemption without any restriction as to the number of securities as of a particular date that can then be immediately sold,
the Securities 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):

 

“NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
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 AN APPLICABLE EXEMPTION 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 for the applicable shares of Common Stock without such
legend to the holder of any Security upon which it is stamped or (as requested by such holder) issue the applicable shares of Common
Stock to such holder by electronic delivery by crediting the account of such holder’s broker with The Depository Trust Company
(“DTC”), 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 an applicable exemption without any
restriction as to the number of securities as of a particular date that can then be immediately sold; or (b) the Company or the Buyer
provides the Legal Counsel Opinion (as contemplated by and in accordance herewith) 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 Company shall be responsible for the fees of its transfer agent and all DTC fees associated with any such issuance.
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, under any applicable exemption at
the Deadline (as defined in the Note), it will be considered an Event of Default pursuant to Section 3 of the Note.

 

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h. Authorization;
Enforcement. This Agreement has been duly and validly authorized by the Buyer and 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, except
as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’
rights generally and except as may be limited by the exercise of judicial discretion in applying principles of equity.

 

 i. [Reserved.]

 

j. No
Shorting. Buyer and its affiliates shall be prohibited from engaging directly or indirectly in any short selling or hedging transactions
with respect to any securities of the Company while this Note is outstanding.

 

3. Representations
and Warranties of the Company. The Company represents and warrants to the Buyer as of the Closing Date that:

 

a. Organization
and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation or other entity duly organized,
validly existing and in good standing under the laws of the jurisdiction in which it is incorporated or organized, 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), if attached hereto, 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 or financial condition
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, the Warrant, 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, and the Warrant 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
Warrant, as well as the issuance and reservation for issuance of the Conversion Shares issuable upon conversion of the Note or exercise
of the Warrant) have been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company,
its Board of Directors, its shareholders, or its debt holders is required; (iii) this Agreement, the Note, and the Warrant, (together
with any other instruments executed in connection herewith or therewith) have 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,
the Note, the Warrant, and the other instruments documents executed in connection herewith or therewith and bind the Company accordingly;
and (iv) this Agreement constitutes, and upon execution and delivery by the Company of the Note, the Warrant, and each of such instruments
will constitute, a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with their terms,
except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’
rights generally and except as may be limited by the exercise of judicial discretion in applying principles of equity.

 

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c. Capitalization;
Governing Documents. As of January 13, 2022, the authorized capital stock of the Company consists of: 36,000,000 authorized shares
of Common Stock, of which and 1,616,022 shares were outstanding. All of such outstanding shares of capital stock of the Company and the
Conversion Shares, 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. As of the effective date of this Agreement, other than as
publicly announced prior to such date and reflected in the SEC Documents (as defined in this Agreement) of the Company (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) other than provided
herein, 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 any of the Securities. The Company has furnished to the Buyer true and correct copies of the Company’s Certificate of Incorporation
as in effect on the date hereof (“Certificate of Incorporation”), the Company’s Bylaws, as in effect on the date hereof
(the “Bylaws”), 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.

 

d. Issuance
of Conversion Shares. The Conversion Shares are duly authorized and reserved for issuance and, upon conversion of the Note or exercise
of the Warrant in accordance with their 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. No
Broker-Dealer Acknowledgement. Unless otherwise advised by legal counsel to the Company, the Company shall not to any person, institution,
governmental or other entity, state, claim, allege, or in any way assert, that Buyer is currently, or ever has been a broker-dealer under
the Securities Exchange Act of 1934.

 

f. Acknowledgment
of Dilution. The Company understands and acknowledges the potentially dilutive effect of the Conversion Shares to the Common Stock
upon the conversion of the Note or exercise of the Warrant. The Company further acknowledges that its obligation to issue, upon conversion
of the Note or exercise of the Warrant, the Conversion Shares, in accordance with this Agreement, the Note, and the Warrant are absolute
and unconditional, subject to the terms and conditions herein and therein, regardless of the dilutive effect that such issuance may have
on the ownership interests of other shareholders of the Company.

 

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g. Ranking;
No Conflicts. The Note shall be a subordinate debt obligation of the Company. The execution, delivery and performance of this Agreement
and 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 Bylaws; 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, note, evidence of indebtedness, 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 is 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);
or (iv) trigger any anti-dilution or ratchet provision contained in any other contract in which the Company is a party thereto or any
security issued by the Company. Neither the Company nor any of its Subsidiaries is in violation of its Certificate of Incorporation,
Bylaws 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, and the Warrant in accordance with
the terms hereof or thereof or to issue and sell each of the Note and the Warrant in accordance with the terms hereof and, upon conversion
of the Note or exercise of the Warrant, issue Conversion Shares. 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 and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing.

 

h. 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”). 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 subsequent to May 31, 2021, 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. The Company has never been a “shell company” as described in Rule 144(i)(1)(i).

 

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i. Absence
of Certain Changes. Since May 31, 2021, there has been no material adverse change and no material adverse development in the assets,
liabilities, business, properties, operations, financial condition, results of operations, or 1934 Act reporting status of the Company
or any of its Subsidiaries.

 

j. 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. The SEC Documents contain 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.
Notwithstanding the foregoing, the Buyer acknowledges the existence of all litigations disclosed and outstanding the SEC Documents.

 

k. Intellectual
Property. 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); 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.

 

l. 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.

 

m. 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, whether or not 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.

 

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n. Transactions
with Affiliates. 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 described in the SEC Documents, 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.

 

o. 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 the terms 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, 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).

 

p. Acknowledgment
Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees that the Buyer is acting solely in the capacity
of arm’s length purchaser 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’s
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.

 

q. 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.

 

r. No
Brokers. Other than the use of Moody Capital Solutions Inc, 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.

 

s. 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. Since
May 31, 2021, 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.

 

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 t. 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.

 

(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.

 

u. Title
to Property. 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 except such as are described in Schedule 3(u), if attached hereto, 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.

 

v. Insurance.
The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks
and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company and its
Subsidiaries are engaged. Neither the Company nor any such Subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not have a Material Adverse Effect. 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.

 

    	9

     

    

 

w. Internal
Accounting Controls. 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.

 

x. 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.

 

y. 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 transactions 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’s financial statements for
its most recent fiscal year end and interim financial statements have been prepared assuming the Company will continue as a going concern,
which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

 

z. 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.

 

aa.
No Off-Balance Sheet Arrangements. There is no transaction, arrangement, or other relationship between the Company or any of its
Subsidiaries and an unconsolidated or other off- balance sheet entity that is required to be disclosed by the Company in its 1934 Act
filings and is not so disclosed or that otherwise could be reasonably likely to have a Material Adverse Effect.

 

bb.
No Disqualification Events. None of the Company, any of its predecessors, any affiliated issuer, any director, executive officer,
other officer of the Company participating in the offering hereunder, any beneficial owner of twenty percent (20%) or more of the Company’s
outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405
under the 1933 Act) connected with the Company in any capacity at the time of sale (each, an “Issuer Covered Person”) is
subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the 1933 Act (a “Disqualification
Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to
determine whether any Issuer Covered Person is subject to a Disqualification Event.

 

    	10

     

    

 

cc.
Manipulation of Price. The Company has not, and to its knowledge no one acting on its behalf has: (i) taken, directly or indirectly,
any action designed to cause or to result, or that could reasonably be expected to cause or result, in the stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of any of the Securities; (ii) sold, bid for, purchased,
or paid any compensation for soliciting purchases of, any of the Securities; or (iii) paid or agreed to pay to any person any compensation
for soliciting another to purchase any other securities of the Company.

 

dd.
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries is subject to the Bank Holding Company Act of 1956,
as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”).
Neither the Company nor any of its Subsidiaries or affiliates owns or controls, directly or indirectly, five percent (5%) or more of
the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity
that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or affiliates exercises
a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the
Federal Reserve.

 

ee.
Illegal or Unauthorized Payments; Political Contributions. Neither the Company nor any of its Subsidiaries nor, to the Company’s
knowledge, any of the officers, directors, employees, agents or other representatives of the Company or any of its Subsidiaries or any
other business entity or enterprise with which the Company or any Subsidiary is or has been affiliated or associated, has, directly or
indirectly, made or authorized any payment, contribution or gift of money, property, or services, whether or not in contravention of
applicable law, (i) as a kickback or bribe to any person; or (ii) to any political organization, or the holder of or any aspirant to
any elective or appointive public office except for personal political contributions not involving the direct or indirect use of funds
of the Company or any of its Subsidiaries.

 

ff.
Breach of Representations and Warranties by the Company. The Company agrees that 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 of the Note.

 

 4. ADDITIONAL COVENANTS, AGREEMENTS AND ACKNOWLEDGEMENTS.

 

 a. [Intentionally Omitted].

 

b. Use
of Proceeds. The Company shall use the proceeds for working capital by the Company and; provided further that none of the proceeds
shall be used for the repayment of any indebtedness owed to affiliates of officers, directors or employees of the Company or in violation
or contravention of any applicable law, rule or regulation.

 

c. Usury.
To the extent it may lawfully do so, the Company hereby agrees not to insist upon or plead or in any manner whatsoever claim, and will
resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at any time hereafter
in force, in connection with any action or proceeding that may be brought by the Buyer in order to enforce any right or remedy under
this Agreement, the Note, the Warrant and any document, agreement or instrument contemplated thereby. Notwithstanding any provision to
the contrary contained in this Agreement, the Note, the Warrant and any document, agreement or instrument contemplated thereby, it is
expressly agreed and provided that the total liability of the Company under this Agreement, the Note, the Warrant or any document, agreement
or instrument contemplated thereby for payments which under applicable law are in the nature of interest shall not exceed the maximum
lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting the foregoing, in no event shall
any rate of interest or default interest, or both of them, when aggregated with any other sums which under applicable law in the nature
of interest that the Company may be obligated to pay under this Agreement, the Note, the Warrant and any document, agreement or instrument
contemplated thereby exceed such Maximum Rate. It is agreed that if the maximum contract rate of interest allowed by law applicable to
this Agreement, the Note, the Warrant, and any document, agreement or instrument contemplated thereby is increased or decreased by statute
or any official governmental action subsequent to the date hereof, the new maximum contract rate of interest allowed by law will be the
Maximum Rate applicable to this Agreement, the Note, the Warrant and any document, agreement or instrument contemplated thereby from
the effective date thereof forward, unless such application is precluded by applicable law. If under any circumstances whatsoever, interest
in excess of the Maximum Rate is paid by the Company to the Buyer with respect to indebtedness evidenced by this Agreement, the Note,
the Warrant and any document, agreement or instrument contemplated thereby, such excess shall be applied by the Buyer to the unpaid principal
balance of any such indebtedness or be refunded to the Company, the manner of handling such excess to be at the Buyer’s election.

 

    	11

     

    

 

d. Restriction
on Activities. Commencing as of the date first above written, and until the earlier of payment of the Note in full or full conversion
of the Note, or full exercise of the Warrant, the Company shall not, directly or indirectly, without the Buyer’s prior written
consent, which consent shall not be unreasonably withheld: (a) change the nature of its business in any material respect; or (b) sell,
divest, acquire, change the structure of any material assets other than in the ordinary course of business.

 

e. Listing.
The Company, for so long as the Buyer owns any of the Securities, will maintain the listing and trading of its Common Stock on the
OTCQB or any equivalent replacement exchange or electronic quotation system (including but not limited to the Pink Sheets electronic
quotation system) (as applicable, the “Principal Market”) 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 notices it receives from the Principal Market
and any other exchanges or electronic quotation systems on which the Common Stock is then traded regarding the continued eligibility
of the Common Stock for listing on such exchanges and quotation systems.

 

f. Corporate
Existence. The Company will, so long as the Buyer beneficially owns any of the Securities, 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 or quotation on the Principal Market, any tier of the NASDAQ
Stock Market or the New York Stock Exchange (including the NYSE American).

 

g. 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.

 

h. Breach
of Covenants. The Company acknowledges and agrees that if the Company breaches any of the covenants set forth in this Section 4,
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 of the Note.

 

    	12

     

    

 

i. Compliance
with 1934 Act; Public Information Failures. For so long as the Buyer beneficially owns any of the Securities, 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. During the period that the Buyer beneficially owns the Note, if the Company shall (i) fail for any reason to satisfy the requirements
of Rule 144(c)(1), including, without limitation, the failure to satisfy the current public information requirements under Rule 144(c);
or (ii) if the Company has ever been an issuer described in Rule 144(i)(1)(i) or becomes such an issuer in the future, and the Company
shall fail to satisfy any condition set forth in Rule 144(i)(2) (each, a “Public Information Failure”) then, as partial relief
for the damages to the Buyer by reason of any such delay in or reduction of its ability to sell the Securities (which remedy shall not
be exclusive of any other remedies available pursuant to this Agreement, the Note, or at law or in equity), the Company shall pay to
the Buyer an amount in cash equal to three percent (3%) of the Purchase Price on each of the day of a Public Information Failure and
on every thirtieth day (pro-rated for periods totaling less than thirty days) thereafter until the date such Public Information Failure
is cured. The payments to which a Buyer shall be entitled pursuant to this Section 4(i) are referred to herein as “Public Information
Failure Payments.” Public Information Failure Payments shall be paid on the earlier of (i) the last day of the calendar month during
which such Public Information Failure Payments are incurred; and (ii) the third business day after the event or failure giving rise to
the Public Information Failure Payments is cured. In the event the Company fails to make Public Information Failure Payments in a timely
manner, such Public Information Failure Payments shall bear interest at the rate of eight percent (8%) per month (prorated for partial
months) until paid in full.

 

j. Disclosure
of Transactions and Other Material Information. By 9:00 a.m., New York time, one (1) business days following the Closing Date, the
Company shall file a Current Report on Form 8-K describing the terms of the transactions contemplated by this Agreement in the form required
by the 1934 Act and attaching this Agreement, the form of Note (the “8-K Filing”). From and after the filing of the 8-K Filing
with the SEC, none of the Company, any of its Subsidiaries or any of their respective officers, directors, employees or agent shall disclose
to the Buyer any material, nonpublic information that is not disclosed in the 8-K Filing. In addition, effective upon the filing of the
8-K Filing, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether
written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, affiliates, employees or
agents, on the one hand, and the Buyer or any of its affiliates, on the other hand, shall terminate.

 

k. Legal
Counsel Opinions. Upon the request of the Buyer from to time to time, the Company shall be responsible, at its cost, for promptly
supplying to the Company’s transfer agent and the Buyer a customary legal opinion letter of its counsel (the “Legal Counsel
Opinion”) to the effect that the resale of the Conversion Shares by the Buyer or its affiliates, successors and assigns is exempt
from the registration requirements of the 1933 Act pursuant to Rule 144, provided the requirements of Rule 144 are satisfied and provided
the Conversion Shares are not then registered under the 1933 Act for resale pursuant to an effective registration statement, or other
applicable exemption, provided the requirements of such other applicable exemption are satisfied. Buyer will provide the customary representations
to counsel in order to provide such an opinion. Should the Company’s legal counsel fail for any reason other than that the requirements
of said exemption are unavailable in the reasonable opinion of counsel to issue the Legal Counsel Opinion, the Buyer may, at the Company’s
cost, secure another legal counsel to issue the Legal Counsel Opinion, and the Company will instruct its transfer agent to accept such
opinion. The Company hereby agrees that it may never take the position that it is a “shell company” in connection with its
obligations under this Agreement or otherwise.

 

l. Most-Favored
Nation. So long the Note and/or the Warrant are outstanding, upon any issuance by the Company of any new security, with any term
that the Buyer reasonably believes is more favorable to the holder of such security or with a term in favor of the holder of such security
that the Buyer reasonably believes was not similarly provided to the Buyer in the Note, the Warrant, or under this Agreement, then (i)
the Holder shall notify the Company of such additional or more favorable term within one (1) business day of the issuance or amendment
(as applicable) of the respective security, and (ii) such term, at Buyer’s option, shall become a part of the Note, Warrant or
this Agreement, as applicable (regardless of whether the Company or Holder complied with the notification provision of this Section).
The types of terms contained in another security that may be more favorable to the holder of such security include, but are not limited
to, terms addressing conversion discounts, prepayment rate, conversion lookback periods, interest rates, and original issue discounts.
If Buyer elects to have the term become a part of the Note, Warrant or this Agreement, as applicable, then the Company shall immediately
deliver acknowledgment of such adjustment in form and substance reasonably satisfactory to the Buyer (the “Acknowledgment”)
within one (1) business day of Company’s receipt of request from Buyer (the “Adjustment Deadline”), provided that Company’s
failure to timely provide the Acknowledgement shall not affect the automatic amendments contemplated hereby.

 

    	13

     

    

 

m. Non-Public
Information. The Company covenants and agrees that neither it, nor any other person acting on its behalf will provide the Buyer or
its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes, material non-public information,
unless prior thereto the Buyer shall have consented to the receipt of such information and agreed with the Company to keep such information
confidential. The Company understands and confirms that the Buyer shall be relying on the foregoing covenant in effecting transactions
in securities of the Company. To the extent that the Company delivers any material, non-public information to the Buyer without such
Buyer’s consent, the Company hereby covenants and agrees that such Buyer shall not have any duty of confidentiality to the Company,
any of its Subsidiaries, or any of their respective officers, directors, agents, employees or affiliates, not to trade on the basis of,
such material, non-public information, provided that the Buyer shall remain subject to applicable law. To the extent that any notice
provided, information provided, or any other communications made by the Company, to the Buyer, constitutes or contains material non-public
information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice or other material information
with the SEC pursuant to a Current Report on Form 8-K. In addition to any other remedies provided by this Agreement or the related transaction
documents, if the Company provides any material non-public information to the Buyer without Buyer’s prior written consent, and
the Company fails to immediately (no later than that business day) file a Form 8-K disclosing this material non-public information, it
shall pay the Buyer as partial liquidated damages and not as a penalty a sum equal to $3,000 per day beginning with the day the information
is disclosed to the Buyer and ending and including the day the Form 8-K disclosing this information is filed.

 

 n. Right of Participation/Refusal in Subsequent Offerings.

 

i. From
the date first written above until thirty-six (36) months thereafter, the Company will not, (i) directly or indirectly, offer, sell,
grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition
of) any of its or its Subsidiaries’ debt, equity or equity equivalent securities, including without limitation any debt, preferred
shares or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable
or exercisable for Common Stock (any such offer, sale, grant, disposition or announcement, other than an Excluded Issuance (as defined
below) being referred to as a “Subsequent Placement”); or (ii) enter into any definitive agreement with regard to the foregoing,
in each case unless the Company shall have first complied with this Section 4(n).

 

ii.
The Company shall deliver to the Buyer an irrevocable written notice (the “Offer Notice”) of any proposed or intended issuance
or sale or exchange (the “Offer”) of the securities being offered (the “Offered Securities”) in a Subsequent
Placement, which Offer Notice shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which
they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify
the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z)
offer to issue and sell to or exchange with the Buyer the greater of (i) at least one hundred percent (100%) of the Offered Securities
(the “Subscription Amount”); or (ii) the principal amount of the Note issued hereunder.

 

iii. To
accept an Offer, in whole or in part, the Buyer must deliver a written notice to the Company prior to the end of the next business day
after the Buyer’s receipt of the Offer Notice (the “Offer Period”), setting forth the portion of the Subscription Amount
that the Buyer elects to purchase (the “Notice of Acceptance”). The Company shall have ten (10) business days from the expiration
of the Offer Period to complete the Subsequent Placement and in connection therewith to issue and sell the Subscription Amount to the
Buyer but only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable
to the Buyer or less favorable to the Company than those set forth in the Offer Notice. Following such ten (10) business day period,
the Company shall publicly announce either (A) the consummation of the Subsequent Placement or (B) the termination of the Subsequent
Placement.

 

    	14

     

    

 

iv. Notwithstanding
anything to the contrary contained herein, if the Company desires to modify or amend the terms and conditions of the Offer prior to the
expiration of the Offer Period, the Company shall deliver to the Buyer a new Offer Notice and the Offer Period shall expire on the next
business day after the Buyer’s receipt of such new Offer Notice.

 

v. If
by the fifteenth (15th) business day following delivery of the Offer Notice no public disclosure regarding a transaction with
respect to the Offered Securities has been made, and no notice regarding the abandonment of such transaction has been received by the
Buyer, such transaction shall be deemed to have been abandoned and the Buyer shall not be deemed to be in possession of any material,
non-public information with respect to the Company.

 

vi. Notwithstanding
the forgoing, a Subsequent Placement shall not include any of the following issuances (each, an “Excluded Issuance”): Any
issuances of Common Stock:

 

		(1)	for
                                            compensatory or incentive purposes to officers, employees or directors of, or consultants
                                            to, the Company or any of its affiliates including, without limitation, the grant of stock
                                            options, deferred share units, restricted share units or restricted shares, duly adopted
                                            for such purposes by a majority of the non-employee members of the Board of Directors of
                                            the Company (the “Board”) or a majority of the members of the committee of nonemployee
                                            members of the Board established for such purpose;
	 	 	 
		(2)	pursuant
                                            to a rights offering by the Company or pursuant to a shareholder rights plan of the Company
                                            that is carried out on a pro rata basis among all holders of the applicable class of securities
                                            of the Company;
	 	 	 
		(3)	upon
                                            the exercise, conversion or exchange of any securities exercisable, convertible or exchangeable
                                            for or into shares of Common Stock;
	 	 	 
		(4)	pursuant
                                            to any over-allotment option granted to the underwriters in a securities offering;
	 	 	 
		(5)	as
                                            a result of the consolidation or subdivision of any securities of the Company, or as a special
                                            distribution or stock dividend or similar transaction that is carried out on a pro rata basis
                                            among all holders of the applicable class of securities of the Company; or
	 	 	 
		(6)	in
                                            connection with or pursuant to any merger, business combination, joint venture, exchange
                                            offer, take-over bid, arrangement, amalgamation, asset purchase transaction or acquisition
                                            of assets or shares of a third party.

 

o. Registration
Rights. The Company shall comply with all the terms of the Registration Rights Agreement entered into herewith, in the form attached
hereto as Exhibit C (the “Registration Rights Agreement”).

 

p. Business
Day. As used in this Agreement, the term “business day” shall mean any day other than a Saturday, Sunday or a day on
which the Federal Reserve Bank of New York is closed; provided, that, banks shall not be deemed to be authorized or obligated to be closed
due to a “shelter in place,” “non-essential employee” or similar closure of physical branch locations at the
direction of any governmental authority if such banks’ electronic funds transfer systems (including for wire transfers) are open
for use by customers on such day..

 

    	15

     

    

 

5. Transfer
Agent Instructions. The Company shall issue irrevocable instructions to the Company’s transfer agent to issue certificates,
registered in the name of the Buyer or its nominee, upon conversion of the Note, or the Warrant, the Conversion Shares, in such amounts
as specified from time to time by the Buyer to the Company in accordance with the terms thereof (the “Irrevocable Transfer Agent
Instructions”) as provided for at Exhibit D hereto. In the event that the Company proposes to replace its transfer agent,
the Company shall provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions
in a form as initially delivered pursuant to this Agreement (including but not limited to the provision to irrevocably reserved shares
of Common Stock in the Reserved Amount (as defined in the Note)) signed by the successor transfer agent to the Company and the Company.
Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to
any applicable exemption 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 as specified in this Agreement. The Company warrants that: (i) no instruction
other than the Irrevocable Transfer Agent Instructions referred to in this Section 5 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, the Note, and the Warrant; (ii) it will not direct its transfer agent not to transfer or delay, impair, or hinder
its transfer agent in transferring (or issuing electronically or in certificated form) any certificate for Securities 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; (iii) it will not
fail to remove (or directs its transfer agent not to remove or impairs, delays, 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 Securities issued to the Buyer upon
conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; and (iv) it will provide any required
corporate resolutions and issuance approvals to its transfer agent within six (6) hours of each conversion of the Note. Nothing in this
Section shall affect in any way the Buyer’s obligations and agreement set forth herein to comply with all applicable prospectus
delivery requirements, if any, upon resale of the Securities. If the Buyer provides the Company, at the cost of the Company, with (A)
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 (B) the
Buyer provides reasonable assurances that the Securities can be sold pursuant to any applicable exemption, the Company shall permit the
transfer, and, in the case of the Securities, 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 5 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
to the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Securities 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:

 

 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 the terms
herein.

 

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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
to The Buyer’s Obligation to Purchase. The obligation of the Buyer hereunder to purchase the Securities, on the Closing Date,
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 the duly executed Note in such denominations as the Buyer shall request and in accordance with
Section 1 above.

 

c. The
Warrant, Irrevocable Transfer Agent Instructions, in form and substance satisfactory to the Buyer, the Registration Rights Agreement,
and any other transaction document entered into as part of this transaction (collectively with the Agreement and Note, the “Transaction
Documents”) shall have been delivered to and acknowledged in writing by the Company’s Transfer Agent.

 

d. 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 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.

 

e. 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.

 

f. 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.

 

 g. The Company shall have delivered to the Buyer (i) a certificate evidencing the formation and good standing of the Company and each of its Subsidiaries in such entity’s jurisdiction of formation issued by the Secretary of State (or comparable office) of such jurisdiction, as of a date within ten (10) days of the Closing Date, and (ii) resolutions adopted by the Company’s Board of Directors at a duly called meeting or by unanimous written consent authorizing this Agreement and all other documents, instruments and transactions contemplated hereby.

 

    	17

     

    

 

 8. Governing Law; Miscellaneous.

 

a. Governing
Law; Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard
to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by
this Agreement, the Note, the Warrant, or any other agreement, certificate, instrument or document contemplated hereby 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. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE,
AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT
OR ANY TRANSACTIONS CONTEMPLATED HEREBY. The prevailing party shall be entitled to recover from the other party its reasonable attorneys’
fees and costs. 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, the Note, or any other agreement, certificate, instrument or document contemplated hereby
or thereby 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.

 

b. Counterparts.
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.
A facsimile or .pdf signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and
effect as if the signature were an original, not a facsimile or .pdf signature. Delivery of a counterpart signature hereto by facsimile
or email/.pdf transmission shall be deemed validly delivery thereof.

 

c. Construction;
Headings. This Agreement shall be deemed to be jointly drafted by the Company and the Buyer and shall not be construed against any
person as the drafter hereof. 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, the Note, the Warrant, or any other agreement or instrument 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 this
Agreement, the Note, the Warrant, or any other agreement, certificate, instrument or document contemplated hereby or thereby.

 

e. Entire
Agreement; Amendments. This Agreement, the Note, the Warrant, 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 or any agreement or instrument contemplated hereby may be waived or amended other than by an instrument in writing signed by
the Buyer.

 

    	18

     

    

 

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, e-mail or facsimile, 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 e-mail or facsimile, with accurate confirmation generated by the transmitting facsimile machine, 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:

 

If
to the Company, to:

 

SIMPLICITY
ESPORTS AND GAMING COMPANY

 

7000
West Palmetto Park Road, Suite 505

Boca Raton, Florida 33433

Attention:
Roman Franklin

e-mail:
roman@simplicityesports.com

 

If to the Buyer:

 

Pursuant
to the contact information in the subscription page below

 

g. Successors
and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. The Company
shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Buyer. Notwithstanding
the foregoing, subject to the provisions hereof, 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 notwithstanding any due diligence investigation conducted by or on behalf of the Buyer. 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 or alleged 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. Publicity.
The Company, and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC,
Principal 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, Principal
Market (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 and be given an opportunity to comment thereon).

 

k. Expense
Reimbursement; Further Assurances. At the Closing to occur as of the Closing Date, the Company shall pay on behalf of the Buyer or
reimburse the Buyer for its reasonable legal fees and expenses incurred in connection with this Agreement, pursuant to the disbursement
authorization signed by the Company of even date, up to a maximum of $10,000. 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

     

    

 

l. 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.

 

m. Indemnification.
In consideration of the Buyer’s execution and delivery of this Agreement and acquiring the Securities hereunder, and in addition
to all of the Company’s other obligations under this Agreement or the Note, the Company shall defend, protect, indemnify and hold
harmless the Buyer and its stockholders, partners, members, officers, directors, employees and direct or indirect investors and any of
the foregoing persons’ agents or other representatives (including, without limitation, those retained in connection with the transactions
contemplated by this Agreement) (collectively, the “Buyer Party”) from and against any and all third party actions, causes
of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective
of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable attorneys’
fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or
relating to (a) any misrepresentation or breach of any representation or warranty made by the Company in this Agreement, the Note or
any other agreement, certificate, instrument or document contemplated hereby or thereby, (b) any breach of any covenant, agreement or
obligation of the Company contained in this Agreement, the Note or any other agreement, certificate, instrument or document contemplated
hereby or thereby or (c) any cause of action, suit or claim brought or made against such Indemnitee by a third party (including for these
purposes a derivative action brought on behalf of the Company) and arising out of or resulting from (i) the execution, delivery, performance
or enforcement of this Agreement, the Note or any other agreement, certificate, instrument or document contemplated hereby or thereby;
(ii) any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds of the issuance of the
Securities; or (iii) the status of the Buyer or holder of the Securities as an investor in the Company pursuant to the transactions contemplated
by this Agreement. To the extent that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall
make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities that is permissible under applicable
law. If any action shall be brought against any Buyer Party in respect of which indemnity may be sought pursuant to this Agreement, such
Buyer Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel
of its own choosing reasonably acceptable to the Buyer Party. Any Buyer Party shall have the right to employ separate counsel in any
such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Buyer Party
except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has
failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable
opinion of counsel, a material conflict on any material issue between the position of the Company and the position of such Buyer Party,
in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company
will not be liable to any Buyer Party under this Agreement (y) for any settlement by a Buyer Party effected without the Company’s
prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss,
claim, damage or liability is attributable to any Buyer Party’s breach of any of the representations, warranties, covenants or
agreements made by such Buyer Party in this Agreement or in the other Transaction Documents. The indemnification required by this Section
4.8 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are
received or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any
Buyer Party against the Company or others and any liabilities the Company may be subject to pursuant to law.

 

    	20

     

    

 

n. Remedies.
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, the Note, or the Warrant will be inadequate and agrees, in the event of a breach or threatened
breach by the Company of the provisions of this Agreement, the Note, or the Warrant 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, the Note, or the Warrant 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. As to any item not covered
herein, the Buyers will have the right of set off with regard to the payment of the Purchase Price or any other obligation that may become
due by the Buyers and to the Company.

 

o. Payment
Set Aside. To the extent that the Company makes a payment or payments to the Buyer hereunder or pursuant to the Note, or the Buyer
enforces or exercises its rights hereunder or thereunder, and such payment or payments or the proceeds of such enforcement or exercise
or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by
or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other person or entity under
any law (including, without limitation, any bankruptcy law, foreign, state or federal law, common law or equitable cause of action),
then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued
in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

 

p. Failure
or Indulgence Not Waiver. No failure or delay on the part of the Buyer in the exercise of any power, right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other right, power or privileges. All rights and remedies of the Buyer existing hereunder are cumulative to,
and not exclusive of, any rights or remedies otherwise available.

 

[SIGNATURE
PAGE FOLLOWS]

 

    	21

     

    

 

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

 

SIMPLICITY
ESPORTS AND GAMING COMPANY

 

	By:	 /s/ Roman Franklin	 
	Name:	 Roman Franklin	 
	Title:	 Chief Executive Officer	 

 

    	22

     

    

 

[PURCHASER
SIGNATURE PAGES TO SECURITIES PURCHASE AGREEMENT]

 

IN
WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories
as of the date first indicated above.

 

Name
of Purchaser: Jefferson Street Capital, LLC

 

	/s/ Brian Goldberg	 
	Signature of Authorized Signatory of Purchaser:	 
	 	 
	Brian Goldberg	 
	Name of Authorized Signatory:	 
	 	 
	Managing Member	 
	Title of Authorized Signatory:	 
	 	 
	 	 
	Email Address of Authorized Signatory:	 
	
     

    

    

     
	 
	Facsimile Number of Authorized Signatory:	 
	 	 
	720 Monroe Street, Suite C401B, Hoboken, New Jersey 07030	 
	Address for Notice to Purchaser:	 

 

Address
for Delivery of Securities to Purchaser (if not same as address for notice):

 

Subscription Amount: $75,000

 

Principal
Amount: $82,500

 

*The
purchase price of $75,000 shall be paid promptly after the full execution of the Note and related transaction documents.

 

Warrant
Shares: 37,500

 

EIN
Number: ______________

 

    	23

     

    

  

EXHIBIT
A

 

FORM
OF NOTE

 

[attached
hereto]

 

    	24

     

    

 

EXHIBIT
B

 

FORM
OF WARRANT

 

[attached
hereto]

 

    	25

     

    

 

EXHIBIT
C

 

REGISTRATION
RIGHTS AGREEMENT

 

    	26

     

    

 

EXHIBIT
D

 

TRANSFER
AGENT INSTRUCTIONS

 

    	27Exhibit
10.2

 

NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
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 MAY BE THE LEGAL COUNSEL OPINION (AS DEFINED IN THE PURCHASE AGREEMENT)),
IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144, RULE 144A,
REGULATION S, OR OTHER APPLICABLE EXEMPTION 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.

 

	Principal
    Amount: $82,500.00	Issue
    Date: April 1, 2022
	Actual
    Amount of Purchase Price: $75,000.00	 

 

CONVERTIBLE
PROMISSORY NOTE

 

FOR
VALUE RECEIVED, SIMPLICITY ESPORTS AND GAMING COMPANY, a Delaware corporation (hereinafter called the
“Borrower” or “Company”), hereby promises to pay to the order of Jefferson Street Capital, LLC, or
registered assigns (the “Holder”), in the form of lawful money of the United States of America, the principal sum of
$82,500.00 (the “Principal Amount”) (subject to adjustment herein), with a purchase price of $75,000.00 (the
“Consideration”) plus an original issue discount in the amount of $7,500.00 (the “OID”), and to pay interest
on the Principal Amount under this Note at the rate of twelve percent (12%) (the “Interest Rate”) per annum guaranteed
from the date that the amount of Consideration is fully funded in accordance with the terms of this Note until the same becomes due
and payable, whether at maturity or upon acceleration or by prepayment or otherwise, as further provided herein; with the
understanding that six (6) months of interest ($4,950.00) shall be guaranteed and earned in full as of the Issue Date hereof. The
Holder shall pay the Consideration on the Issue Date as set forth above (the “Issue Date”), and the outstanding
principal amount under this Note shall be $82,500.00 (which includes the OID). The maturity date for this Note shall be six (6)
months from the Issue Date (“Maturity Date”), and is the date upon which the principal sum as well as any accrued and
unpaid interest and other fees shall be due and payable. Notwithstanding any other provision of this Note or any related transaction
documents, Borrower may prepay this Note only pursuant to Section 1.9 hereof.

 

It
is further acknowledged and agreed that the Principal Amount owed by Borrower under this Note shall be increased by the amount of all
expenses up to a maximum of $1,000 incurred by the Holder relating to each conversion of this Note into shares of Common Stock. All such
expenses shall be deemed added to the Principal Amount hereunder to the extent such expenses are paid by the Holder.

 

Interest
shall commence accruing on the date that the Note is fully funded and shall be computed on the basis of a 365-day year and the actual
number of days elapsed. Any Principal Amount or interest on this Note which is not paid when due shall bear interest at the rate the
lesser of (a) twenty percent (20%) per annum from the due date thereof until the same is paid (“Default Interest”); or (b)
the maximum rate allowed by law.

 

All
payments due hereunder (to the extent not converted into shares of common stock of the Borrower (the “Common Stock”) in accordance
with the terms hereof) shall be made in lawful money of the United States of America. All payments shall be made at such address as the
Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Whenever any amount
expressed to be due by the terms of this Note is due on any day which is not a business day, the same shall instead be due on the next
succeeding day which is a business day and, in the case of any interest payment date which is not the date on which this Note is paid
in full, the extension of the due date thereof shall not be taken into account for purposes of determining the amount of interest due
on such date.

 

    	1

     

    

 

Each
capitalized term used herein, and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase
Agreement, dated as of the Issue Date, pursuant to which this Note was originally issued (the “Purchase Agreement”). As used
in this Note, the term “business day” mean any day other than a Saturday, Sunday or a day on which the Federal Reserve Bank
of New York is closed; provided, that, banks shall not be deemed to be authorized or obligated to be closed due to a “shelter in
place,” “non-essential employee” or similar closure of physical branch locations at the direction of any governmental
authority if such banks’ electronic funds transfer systems (including for wire transfers) are open for use by customers on such
day. As used herein, the term “Trading Day” means any day that shares of Common Stock are listed for trading or quotation
on the Principal Market (as defined in the Purchase Agreement), any tier of the NASDAQ Stock Market, the New York Stock Exchange or the
NYSE American.

 

This
Note is 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 Borrower and will not impose personal liability upon the holder thereof.

 

The
following terms shall apply to this Note:

 

ARTICLE
I. CONVERSION RIGHTS

 

1.1
Conversion
Right. The Holder shall have the right, at any time while the Conversion Shares are subject to an effective Registration Statement,
or if no Registration Statement covering the Conversion Shares is effective, at any time after one hundred eighty (180) days from the
Issue Date hereof, so long as there are amounts outstanding under the Note, to convert all or any portion of the then outstanding and
unpaid Principal Amount and interest (including any Default Interest) into fully paid and non-assessable shares of Common Stock, as such
Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock
shall hereafter be changed or reclassified, at the Conversion Price (as defined below) determined as provided herein (a “Conversion”);
provided, however, that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion
of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates
(other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of this Note
or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous
to the limitations contained herein) and (2) the number of Conversion Shares issuable upon the conversion of the portion of this Note
with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates
of more than 4.99% of the then outstanding shares of Common Stock. For purposes of the proviso set forth in the immediately preceding
sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended
(the “1934 Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided,
however, that the limitations on conversion may be waived (up to 9.99%) by the Holder upon, at the election of the Holder, not less
than sixty-one (61) days’ prior notice to the Borrower, and the provisions of the conversion limitation shall continue to apply
until such 61st day (or such later date, as determined by the Holder, as may be specified in such notice of waiver). The number of Conversion
Shares to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as defined below) by the
applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit
A (the “Notice of Conversion”), delivered to the Borrower or Borrower’s transfer agent by the Holder in accordance
with Section 1.4 below; provided that the Notice of Conversion is submitted by facsimile or e- mail (or by other means resulting in,
or reasonably expected to result in, notice) to the Borrower or Borrower’s transfer agent before 11:59 p.m., New York, New York
time on such conversion date (the “Conversion Date”). The term “Conversion Amount” means, with respect to any
conversion of this Note, the sum of (1) the Principal Amount of this Note to be converted in such conversion plus (2) at the Holder’s
option, accrued and unpaid interest, if any, on such Principal Amount at the Interest Rate to the Conversion Date, plus (3) at
the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) or (2).

 

    	2

     

    

 

1.2
Conversion Price.

 

(a)
Calculation of Conversion Price. The per share conversion price into which Principal Amount and interest (including any Default
Interest) under this Note shall be convertible into shares of Common Stock hereunder shall be $1.00 per share (the “Fixed Conversion
Price”); provided however, that upon failure to make any payment called for hereunder at any time after the Issue Date hereof,
but prior to the Conversion Date, the Conversion Price shall be $0.50 per share (the “Default Fixed Conversion Price”). The
Fixed Conversion Price or the Default Fixed Conversion Price, as applicable, is referred to as the “Conversion Price”. To
the extent the Conversion Price is below the par value per share, the Borrower will take all steps necessary to solicit the consent of
the stockholders to reduce the par value to the lowest value possible under law, provided however that the Borrower agrees to honor all
conversions submitted pending this decrease. If at any time the Conversion Price as determined hereunder for any conversion would be
less than the par value of the Common Stock, then at the sole discretion of the Holder, the Conversion Price hereunder may equal such
par value for such conversion and the Conversion Amount for such conversion may be increased to include Additional Principal, where “Additional
Principal” means such additional amount to be added to the Conversion Amount to the extent necessary to cause the number of Conversion
Shares issuable upon such conversion to equal the same number of Conversion Shares as would have been issued had the Conversion Price
not been adjusted by the Holder to the par value price. In the event the Borrower has a DTC “Chill” on its shares, an additional
discount of ten percent (10%) shall apply to the Conversion Price while that “Chill” is in effect.

 

(b)
Conversion Price During Major Announcements. Notwithstanding anything contained in Section 1.2(a) to the contrary, in the event
the Borrower (i) makes a public announcement that it intends to be acquired by, consolidate, or merge with any other corporation or entity
(other than a merger in which the Borrower is the surviving or continuing corporation and its capital stock is unchanged) or sell or
transfer all or substantially all of the assets of the Borrower; or (ii) any person, group or entity (including the Borrower) publicly
announces a tender offer to purchase fifty percent (50%) or more of the Common Stock (or any other takeover scheme) (any such transaction
referred to in clause (i) or (ii) being referred to herein as a “Change in Control” and the date of the announcement referred
to in clause (i) or (ii) is being referred to herein as the “Announcement Date”), then the Conversion Price shall, effective
upon the Announcement Date and continuing through the Adjusted Conversion Price Termination Date (as defined below), be equal to the
lower of (x) the Conversion Price and (y) a ten percent (10%) discount to the Acquisition Price (as defined below). From and after the
Adjusted Conversion Price Termination Date, the Conversion Price shall be determined as set forth in Section 1.2(a). For purposes hereof,
“Adjusted Conversion Price Termination Date” shall mean, with respect to any proposed Change in Control for which a public
announcement as contemplated by this Section 1.2(b) has been made, the date upon which the Borrower (in the case of clause (i) above)
or the person, group or entity (in the case of clause (ii) above) consummates or publicly announces the termination or abandonment of
the proposed Change in Control which caused this Section 1.2(b) to become operative. For purposes hereof, “Acquisition Price”
shall mean a price per share of Common Stock derived by dividing (x) the total consideration (in cash, equity, earn- out or similar payments
or otherwise) paid or to be paid to the Borrower or its shareholders in the Change in Control transaction by (y) the number of authorized
shares of Common Stock outstanding as of the business day prior to the Announcement Date.

 

    	3

     

    

 

1.3
Authorized and Reserved Shares. The Borrower covenants that at all times until the Note is satisfied in full, the Borrower will
reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the
issuance of a number of Conversion Shares equal to the greater of: (a) 22,891 shares of Common Stock or (b) the sum of (i) the number
of Conversion Shares issuable upon the full conversion of this Note (assuming no payment of Principal Amount or interest) as of any issue
date (taking into consideration any adjustments to the Conversion Price pursuant to Section 2 hereof or otherwise) multiplied by
(ii) three (3) (the “Reserved Amount”). In the event that the Borrower shall be unable to reserve the entirety of the Reserved
Amount (the “Reserve Amount Failure”), the Borrower shall promptly take all actions necessary to increase its authorized
share capital to accommodate the Reserved Amount (the “Authorized Share Increase”), including without limitation, all board
of directors actions and approvals and promptly calling and holding a special meeting of its shareholders no more than sixty (60) days
following the Reserve Amount Failure to seek approval of the Authorized Share Increase via the solicitation of proxies. Notwithstanding
the foregoing, in no event shall the Reserved Amount be lower than the initial Reserved Amount, regardless of any prior conversions.
The Borrower represents that upon issuance, the Conversion Shares will be duly and validly issued, fully paid and non- assessable. In
addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number of Conversion
Shares into which this Note shall be convertible at the then current Conversion Price, the Borrower shall at the same time make proper
provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive
rights, for conversion of this Note. The Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates
for the Conversion Shares or instructions to have the Conversion Shares issued as contemplated by Section 1.4(f) hereof; and (ii) agrees
that its issuance of this Note shall constitute full authority to its officers and agents who are charged with the duty of executing
stock certificates or cause the Borrower to electronically issue shares of Common Stock to execute and issue the necessary certificates
for the Conversion Shares or cause the Conversion Shares to be issued as contemplated by Section 1.4(f) hereof in accordance with the
terms and conditions of this Note.

 

If,
at any time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default under this Note.

 

1.4
Method of Conversion.

 

(a)
Mechanics of Conversion. Subject to the other provisions herein, this Note may be converted by the Holder in whole or in part,
on any Trading Day, while any amounts are outstanding hereunder, by submitting to the Borrower or Borrower’s transfer agent a Notice
of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 11:59 p.m.,
New York, New York time). Any Notice of Conversion submitted after 11:59 p.m., New York, New York time, shall be deemed to have been
delivered and received on the next Trading Day.

 

(b)
Surrender of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in
accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire
unpaid Principal Amount is so converted. The Holder and the Borrower shall maintain records showing the Principal Amount so converted
and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to
require physical surrender of this Note upon each such conversion. In the event of any dispute or discrepancy, such records of the Borrower
shall, prima facie, be controlling and determinative in the absence of manifest error. Notwithstanding the foregoing, if any portion
of this Note is converted as aforesaid, the Holder may not transfer this Note unless the Holder first physically surrenders this Note
to the Borrower, whereupon the Borrower will forthwith issue and deliver upon the order of the Holder a new Note of like tenor, registered
as the Holder (upon payment by the Holder of any applicable transfer taxes) may request, representing in the aggregate the remaining
unpaid Principal Amount of this Note. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason
of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted Principal Amount of this
Note represented by this Note may be less than the amount stated on the face hereof.

 

    	4

     

    

 

(c)
Payment of Taxes. The Borrower shall not be required to pay any tax which may be payable in respect of any transfer involved in
the issue and delivery of shares of Common Stock or other securities or property on conversion of this Note in a name other than that
of the Holder (or in street name), and the Borrower shall not be required to issue or deliver any such shares or other securities or
property unless and until the person or persons (other than the Holder or the custodian in whose street name such shares are to be held
for the Holder’s account) requesting the issuance thereof shall have paid to the Borrower the amount of any such tax or shall have
established to the satisfaction of the Borrower that such tax has been paid.

 

(d)
Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or
other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section
1.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the
Conversion Shares (or cause the electronic delivery of the Conversion Shares as contemplated by Section 1.4(f) hereof) within two (2)
Trading Days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid Principal Amount
and interest (including any Default Interest) under this Note, surrender of this Note). If the Borrower shall fail for any reason or
for no reason to issue to the Holder on, or prior to, the Deadline a certificate for the number of Conversion Shares, or to which the
Holder is entitled hereunder and register such Conversion Shares on the Borrower’s share register, or to credit the Holder’s
balance account with DTC (as defined below) for such number of Conversion Shares to which the Holder is entitled upon the Holder’s
conversion of this Note (a “Conversion Failure”), then, in addition to all other remedies available to the Holder, (i) the
Borrower shall pay in cash to the Holder on each day after the Deadline and during such Conversion Failure an amount equal to two percent
(2.0%) of the product of (A) the sum of the number of Conversion Shares not issued to the Holder on or prior to the Deadline and to which
the Holder is entitled and (B) the closing sale price of the Common Stock on the Trading Day immediately preceding the last possible
date which the Borrower could have issued such Conversion Shares to the Holder without violating this Section 1.4(d); and (ii) the Holder,
upon written notice to the Borrower, may void its Notice of Conversion with respect to, and retain or have returned, as the case may
be, any portion of this Note that has not been converted pursuant to such Notice of Conversion; provided that the voiding of a Notice
of Conversion shall not affect the Borrower’s obligations to make any payments which have accrued prior to the date of such notice.
In addition to the foregoing, if on or prior to the Deadline the Borrower shall fail to issue and deliver a certificate to the Holder
and register such Conversion Shares on the Borrower’s share register or credit the Holder’s balance account with DTC for
the number of Conversion Shares to which the Holder is entitled upon the Holder’s exercise hereunder or pursuant to the Borrower’s
obligation pursuant to clause (ii) below, and if on or after such Trading Day the Holder purchases (in an open market transaction or
otherwise) shares of Common Stock to deliver in satisfaction of a sale by the Holder of shares of Common Stock issuable upon such exercise
that the Holder anticipated receiving from the Borrower, then the Borrower shall, within two (2) Trading Days after the Holder’s
request and in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal to the Holder’s total purchase
price (including brokerage commissions and other reasonable and customary out- of-pocket expenses, if any) for the shares of Common Stock
so purchased (the “Buy-In Price”), at which point the Borrower’s obligation to deliver such certificate (and to issue
such Conversion Shares) or credit such Holder’s balance account with DTC for such Conversion Shares shall terminate, or (ii) promptly
honor its obligation to deliver to the Holder a certificate or certificates representing such Conversion Shares or credit such Holder’s
balance account with DTC and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of
(A) such number of shares of Common Stock, times (B) the closing sales price of the Common Stock on the date of exercise. Nothing shall
limit the 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 or injunctive relief with respect to the Borrower’s failure to timely deliver certificates representing
the Conversion Shares (or to electronically deliver such Conversion Shares) upon the conversion of this Note as required pursuant to
the terms hereof.

 

    	5

     

    

 

(e)
Obligation of Borrower to Deliver Common Stock. At the time that the Holder submits the Notice of Conversion to the Borrower or
Borrower’s transfer agent, the Holder shall be deemed to be the holder of record of the Conversion Shares issuable upon such conversion,
the outstanding Principal Amount and the amount of accrued and unpaid interest (including any Default Interest) under this Note shall
be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations under this Article I, all rights with respect
to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities,
cash or other assets, as herein provided, on such conversion. If the Holder shall have given a Notice of Conversion as provided herein,
the Borrower’s obligation to issue and deliver the certificates for the Conversion Shares (or cause the electronic delivery of
the Conversion Shares as contemplated by Section 1.4(f) hereof) shall be absolute and unconditional, irrespective of the absence of any
action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against
any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the
holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of
any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower
to the Holder in connection with such conversion. The Conversion Date specified in the Notice of Conversion shall be the Conversion Date
so long as the Notice of Conversion is sent to the Borrower or Borrower’s transfer agent before 11:59 p.m., New York, New York
time, on such date.

 

(f)
Delivery of Conversion Shares by Electronic Transfer. In lieu of delivering physical certificates representing the Conversion
Shares issuable upon conversion hereof, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast
Automated Securities Transfer or Deposit/Withdrawal at Custodian programs, upon request of the Holder and its compliance with the provisions
contained in Section 1.1 and in this Section 1.4, the Borrower shall use its reasonable best efforts to cause its transfer agent to electronically
transmit the Conversion Shares issuable upon conversion hereof to the Holder by crediting the account of Holder’s Prime Broker
with DTC through its Deposit Withdrawal Agent Commission system.

 

1.5
Concerning the Shares. The Conversion Shares issuable upon conversion of this Note may not be sold or transferred unless (i) such
shares are sold pursuant to an effective registration statement under the 1933 Act; or (ii) the Borrower or its transfer agent shall
have been furnished with an opinion of counsel (which opinion shall be the Legal Counsel Opinion (as defined in the Purchase Agreement))
to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration; or
(iii) such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise
transfer the shares only in accordance with this Section 1.5 and who is an Accredited Investor (as defined in the Purchase Agreement).
Except as otherwise provided in the Purchase Agreement (and subject to the removal provisions set forth below), until such time as the
Conversion Shares have been registered under the 1933 Act or otherwise may be sold pursuant to an applicable exemption without any restriction
as to the number of securities as of a particular date that can then be immediately sold, each certificate for the Conversion Shares
that has not been so included in an effective registration statement or that has not been sold pursuant to an effective registration
statement or an exemption that permits removal of the legend, shall bear a legend substantially in the following form, as appropriate:

 

“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 MAY BE THE LEGAL COUNSEL OPINION (AS DEFINED IN THE PURCHASE AGREEMENT)),
IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO AN APPLICABLE EXEMPTION
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.”

 

    	6

     

    

 

The
legend set forth above shall be removed and the Borrower shall issue to the Holder a certificate for the applicable Conversion Shares
without such legend upon which it is stamped or (as requested by the Holder) issue the applicable Conversion Shares by electronic delivery
by crediting the account of such Holder’s broker with DTC, if, unless otherwise required by applicable state securities laws: (a)
such Conversion Shares are registered for sale under an effective registration statement filed under the 1933 Act or otherwise may be
sold pursuant to an applicable exemption without any restriction as to the number of securities as of a particular date that can then
be immediately sold, or (b) the Borrower or the Holder provides the Legal Counsel Opinion (as contemplated by and in accordance with
the Purchase Agreement) to the effect that a public sale or transfer of such Conversion Shares may be made without registration under
the 1933 Act, which opinion shall be accepted by the Borrower so that the sale or transfer is effected. The Borrower shall be responsible
for the fees of its transfer agent and all DTC fees associated with any such issuance. The Holder agrees to sell all Conversion Shares,
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 Borrower does not accept the opinion of counsel provided by the Holder with respect to the
transfer of Conversion Shares pursuant to an exemption from registration at the Deadline, notwithstanding that the conditions of the
applicable exemption, have been met, it will be considered an Event of Default under this Note.

 

1.6
Effect of Certain Events.

 

(a)
Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially
all of the assets of the Borrower, or the consolidation, merger or other business combination of the Borrower with or into any other
Person (as defined below) or Persons when the Borrower is not the survivor shall either: (i) be deemed to be an Event of Default pursuant
to which the Borrower shall be required to pay to the Holder upon the consummation of and as a condition to such transaction an amount
equal to the Default Amount (defined in Section 3.25); or (ii) be treated pursuant to Section 1.6(b) hereof. “Person” shall
mean any individual, corporation, limited liability Borrower, partnership, association, trust or other entity or organization.

 

(b)
Adjustment Due to Merger, Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion
of all of this Note, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar
event, as a result of which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares of
another class or classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of all or substantially
all of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower, then the Holder of this
Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and the terms and conditions specified herein
and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities or assets which the
Holder would have been entitled to receive in such transaction had this Note been converted in full immediately prior to such transaction
(without regard to any limitations on conversion set forth herein), and in any such case appropriate provisions shall be made with respect
to the rights and interests of the Holder of this Note to the end that the provisions hereof (including, without limitation, provisions
for adjustment of the Conversion Price and of the number of shares issuable upon conversion of the Note) shall thereafter be applicable,
as nearly as may be practicable in relation to any securities or assets thereafter deliverable upon the conversion hereof. The Borrower
shall not effectuate any transaction described in this Section 1.6(b) unless (a) it first gives, to the extent practicable, at least
thirty (30) days’ prior written notice (but in any event at least fifteen (15) days’ prior written notice) of the record
date of the special meeting of shareholders to approve, or if there is no such record date, the consummation of, such merger, consolidation,
exchange of shares, recapitalization, reorganization or other similar event or sale of assets (during which time the Holder shall be
entitled to convert this Note), and (b) the resulting successor or acquiring entity (if not the Borrower) assumes by written instrument
the obligations of this Section 1.6(b). The above provisions shall similarly apply to successive consolidations, mergers, sales, transfers,
or share exchanges.

 

    	7

     

    

 

(c)
Adjustment Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire its
assets) to holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any dividend
or distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock of a subsidiary
(i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion of this Note
after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such assets which would
have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had such Holder been the holder
of such shares of Common Stock on the record date for the determination of shareholders entitled to such Distribution.

 

(d)
Purchase Rights. If, at any time when all or any portion of this Note is issued and outstanding, the Borrower issues any convertible
securities or rights to purchase stock, warrants, securities or other property (the “Purchase Rights”) pro rata to the record
holders of any class of Common Stock, then the Holder of this Note will be entitled to acquire, upon the terms applicable to such Purchase
Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder had held the number of shares of Common Stock
acquirable upon complete conversion of this Note (without regard to any limitations on conversion contained herein) immediately before
the date on which a record is taken for the grant, issuance or sale of such Purchase Rights or, if no such record is taken, the date
as of which the record holders of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights.

 

(e)
Dilutive Issuance. If, at any time while this Note is outstanding, the Company or any Subsidiary, as applicable, sells or grants
any option to purchase or sells or enters into any contract, agreement, warrant, note or any other instrument that is convertible into
or otherwise entitles any Person to acquire shares of Common Stock at an effective price per share that is lower than the then-applicable
Conversion Price (each, a “Dilutive Agreement”) or otherwise disposes of or issues, any Common Stock at an effective price
per share that is lower than the then-applicable Conversion Price (each, a “Diluting Issuance”), then, in the event of a
Dilutive Agreement, simultaneously with the entry into of the Dilutive Agreement, the Conversion Price shall be adjusted to be the equal
the price at which the shares of Common Stock are then issuable pursuant to the Dilutive Agreement; and in the event of a Dilutive Issuance,
the Conversion Price shall adjusted to be the equal the price at which the shares of Common Stock were issued or sold in the Dilutive
Issuance. With respect to a Dilutive Agreement, the adjustments to the Conversion Price as set forth in this Section 1.6(e) shall be
undertaken each time that there is a change in the price at which shares of Common Stock are then issuable pursuant to the Dilutive Agreement.
Notwithstanding the foregoing, no adjustment will be made under this Section 1.6(e) in respect of an Exempt Issuance. The Company shall
notify the Holder in writing, no later than the Trading Day following the execution of any Dilutive Agreement or the occurrence of any
Dilutive Issuance, indicating therein the applicable issuance price, or applicable reset price, exchange price, conversion price and
other pricing terms (such notice, the “Dilutive Issuance Notice”). For purposes of clarification, whether or not the Company
provides a Dilutive Issuance Notice pursuant to this Section 1.6(e), upon the occurrence of the events as set forth above, the Conversion
Price shall be adjusted as set forth above, regardless of whether the Holder accurately refers to the Base Conversion Price in the Notice
of Conversion. An “Exempt Issuance” shall mean the issuance of (a) shares of Common Stock or other securities to officers
or directors of the Borrower pursuant to any stock or option or similar equity incentive plan duly adopted for such purpose, by a majority
of the non-employee members of the Borrower’s Board of Directors or a majority of the members of a committee of non- employee directors
established for such purpose in a manner which is consistent with the Borrower’s prior business practices; (b) securities issued
pursuant to a merger, consolidation, acquisition or similar business combination approved by a majority of the disinterested directors
of the Borrower, provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or
through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Borrower and
shall provide to the Borrower additional benefits in addition to the investment of funds, but shall not include a transaction in which
the Borrower is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in
securities; (c) securities issued pursuant to any equipment loan or leasing arrangement, real property leasing arrangement or debt financing
from a bank or similar financial institution approved by a majority of the disinterested directors of the Borrower; (d) securities issued
under any Form 1-A or S-1 filed by the Borrower and declared effective by the Securities and Exchange Commission as of the date hereof;
(e) existing convertible debt and equity lines of credit in existence on the date hereof, (f) private placements of Common Stock by the
Borrower; or (g) securities issued with respect to which the Holder waives its rights in writing under this Section 1.6(e).

 

    	8

     

    

 

(f)
Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Price as a result of the events
described in this Section 1.6, the Borrower, at its expense, shall promptly compute such adjustment or readjustment and prepare and furnish
to the Holder a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment
or readjustment is based. The Borrower shall, upon the written request at any time of the Holder, furnish to such Holder a like certificate
setting forth (i) such adjustment or readjustment, (ii) the Conversion Price at the time in effect, and (iii) the number of shares of
Common Stock and the amount, if any, of other securities or property which at the time would be received upon conversion of the Note.

 

(g)
[reserved]

 

1.7
Adjustments to Conversion Price.

 

(a)
At any time after the Issue Date, (i) if in the case that the Borrower’s Common Stock is not deliverable by DWAC (including if
the Borrower’s transfer agent has a policy prohibiting or limiting delivery of shares of the Borrower’s Common Stock specified
in a Notice of Conversion); (ii) if the Borrower ceases to be a reporting company pursuant or subject to the Exchange Act; (iii) if the
Borrower subsequently loses a market (including the OTC Pink, OTCQB or an equivalent replacement exchange) for its Common Stock; (iv)
if the Borrower fails to maintain its status as “DTC Eligible” for any reason; (v) if the Note cannot be converted into free
trading shares on or after six (6) months from the Issue Date; (vi) if at any time the Borrower does not maintain or replenish the Reserved
Amount (as defined herein) within three (3) business days of the request of the Holder; (vii) if the Borrower fails to maintain the listing
of its Common Stock on at least one of any tier of the OTC Markets or an equivalent replacement exchange, any tier of the Nasdaq Stock
Market, the New York Stock Exchange (including the NYSE American); (viii) if the Borrower fails to comply with the reporting requirements
of the Exchange Act; the reporting requirements necessary to satisfy the availability of Rule 144 to the Holder or its assigns, including
but not limited to the timely fulfillment of its filing requirements as a fully-reporting issuer registered with the SEC; (ix) if the
Borrower effectuates a reverse split of its Common Stock without twenty (20) days’ prior written notice to the Holder; (x) if subsequently
OTC Markets changes the Borrower’s designation to ‘No Information’ (Stop Sign), ‘Caveat Emptor’ (Skull
and Crossbones), or ‘OTC’, ‘Other OTC’ or ‘Grey Market’ (Exclamation Mark Sign); (xi) the restatement
of any financial statements filed by the Borrower with the SEC for any date or period from two (2) years prior to the Issue Date of this
Note and until this Note is no longer outstanding, if the result of such restatement would, by comparison to the un-restated financial
statement, have constituted a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement;
(xii) any cessation of trading of the Common Stock on at least one of any tier of the OTC Markets or an equivalent replacement exchange,
any tier of the Nasdaq Stock Market, the New York Stock Exchange (including the NYSE American), and such cessation of trading shall continue
for a period of three consecutive (3) Trading Days; (xiii) the Borrower loses the “bid” price for its Common Stock ($0.0001
on the “Ask” with zero market makers on the “Bid” per Level 2); or (xiv) if the Holder is notified in writing
by the Borrower or the Borrower’s transfer agent that the Borrower does not have the necessary amount of authorized and issuable
shares of Common Stock available to satisfy the issuance of Conversion Shares pursuant to a Conversion Notice, then in addition to all
other remedies under this Note, the Holder shall be entitled to apply a fifteen percent (15%) discount to the Conversion Price for each
occurrence, cumulative, or otherwise and that discount shall apply to all future conversions under the Note.

 

    	9

     

    

 

(b)
The Conversion Price shall be subject to equitable adjustments for stock splits, stock dividends or rights offerings by the Borrower
relating to the Common Stock, combinations, recapitalization, reclassifications, extraordinary distributions and similar events that
occur on or after the Issue Date. By way of example and not limitation, in the event of forward split of the Common Stock following the
Issue Date in which each share of Common Stock is converted into two shares of Common Stock, the Conversion Price shall be reduced by
50%, and in the event of a reverse split of the Common Stock following such applicable time in which each two shares of Common Stock
are converted into one share of Common Stock, the Conversion Price shall be increased by 100%.

 

1.8
Status as Shareholder. Upon submission of a Notice of Conversion by Holder, (i) the Conversion Shares covered thereby (other than
the Conversion Shares, if any, which cannot be issued because their issuance would exceed such Holder’s allocated portion of the
Reserved Amount or Maximum Share Amount) shall be deemed converted into shares of Common Stock, and (ii) the Holder’s rights as
a Holder of such converted portion of this Note shall cease and terminate, excepting only the right to receive certificates for such
shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure
by the Borrower to comply with the terms of this Note. Notwithstanding the foregoing, if a Holder has not received certificates for all
shares of Common Stock prior to the tenth (10th) business day after the expiration of the Deadline with respect to a conversion
of any portion of this Note for any reason, then (unless the Holder otherwise elects to retain its status as a holder of Common Stock
by so notifying the Borrower) the Holder shall regain the rights of a Holder of this Note with respect to such unconverted portions of
this Note and the Borrower shall, as soon as practicable, return such unconverted Note to the Holder or, if the Note has not been surrendered,
adjust its records to reflect that such portion of this Note has not been converted. In all cases, the Holder shall retain all of its
rights and remedies for the Borrower’s failure to convert this Note.

 

1.9
Prepayment. Notwithstanding anything to the contrary contained in this Note, subject to the terms of this Section, at any time
during the period beginning on the Issue Date and ending at the Maturity Date (“Prepayment Termination Date”), Borrower shall
have the right, exercisable on not less than five (5) Trading Days’ prior written notice to the Holder, to prepay all or any portion
of the outstanding balance on this Note (principal and accrued interest), (such elected amount being the “Optional Prepayment Amount”),
in accordance with this Section. Any notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be delivered
to the Holder of the Note at its registered addresses and shall state: (1) that the Borrower is exercising its right to prepay the Note;
(2) the date of prepayment which shall be not more than five (5) Trading Days from the date of the Optional Prepayment Notice; and (3)
the amount of the Optional Prepayment Amount that the Borrower is paying. Notwithstanding Holder’s receipt of the Optional Prepayment
Notice the Holder may convert, or continue to convert the Note in whole or in part until the Optional Prepayment Amount is paid to the
Holder. On the date fixed for prepayment (the “Optional Prepayment Date”), the Borrower shall make payment of the Optional
Prepayment Amount to or upon the order of the Holder as specified by the Holder in writing to the Borrower at least one (1) business
day prior to the Optional Prepayment Date.

 

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1.10 Repayment
from Proceeds. While any portion of the outstanding Principal Amount and interest (including Default Interest) under this Note
are due and owing, if the Borrower receives cash proceeds from any source or series of related or unrelated sources, including but
not limited to, the issuance of equity or debt, the conversion of outstanding warrants of the Borrower, the issuance of securities
pursuant to an equity line of credit of the Borrower or the sale of assets, the Borrower shall, within one (1) business day of
Borrower’s receipt of such proceeds, inform the Holder of such receipt, following which the Holder shall have the right in its
sole discretion to require the Borrower to immediately apply up to 50% of the proceeds therefrom to repay all or any portion of the
outstanding Principal Amount and interest (including any Default Interest) then due under this Note; provided however that the first
$3,000,000.00 of financing received by the Borrower shall be excepted from the requirements of this Section 1.10. Failure of the
Borrower to comply with this provision shall constitute an Event of Default.

 

ARTICLE
II. RANKING AND CERTAIN COVENANTS

 

2.1
Ranking and Security. The obligations of the Borrower under this Note shall be subordinate with respect to any and all Indebtedness
incurred as of or following the Issue Date.

 

2.2
Other Indebtedness. So long as the Borrower shall have any obligation under this Note, the Borrower shall not (directly or indirectly
through any Subsidiary or affiliate) incur or suffer to exist or guarantee any Indebtedness that is senior to (in priority of payment
and performance) the Borrower’s obligations hereunder unless the proceeds of such Indebtedness are used to pay off the interest
and principal under this Note. As used in this Section 2.2, the term “Borrower” means the Borrower and any Subsidiary of
the Borrower. As used herein, the term “Indebtedness” means (a) all indebtedness of the Borrower for borrowed money, but
not including deferred purchase price obligations in place as of the Issue Date and as disclosed in the SEC Documents or obligations
to trade creditors incurred in the ordinary course of business; (b) all obligations of the Borrower evidenced by notes, bonds, debentures
or other similar instruments; (c) purchase money indebtedness hereafter incurred by the Borrower to finance the purchase of fixed or
capital assets, including all capital lease obligations of the Borrower which do not exceed the purchase price of the assets funded;
(d) all guarantee obligations of the Borrower in respect of obligations of the kind referred to in clauses (a) through (c) above that
the Borrower would not be permitted to incur or enter into; and (e) all obligations of the kind referred to in clauses (a) through (d)
above that the Borrower is not permitted to incur or enter into that are secured or unsecured by (or for which the holder of such obligation
has an existing right, contingent or otherwise, to be secured or unsecured by) any lien or encumbrance on property (including accounts
and contract rights) owned by the Borrower, whether or not the Borrower has assumed or become liable for the payment of such obligation.

 

2.3
Distributions on Capital Stock. So long as the Borrower shall have any obligation under this Note, the Borrower shall not without
the Holder’s written consent (a) pay, declare or set apart for such payment, any dividend or other distribution (whether in cash,
property or other securities) on shares of capital stock other than dividends on shares of Common Stock solely in the form of additional
shares of Common Stock, or (b) directly or indirectly or through any subsidiary make any other payment or distribution in respect of
its capital stock except for distributions pursuant to any shareholders’ rights plan which is approved by a majority of the Borrower’s
disinterested directors.

 

2.4
Restriction on Stock Repurchases and Debt Repayments. So long as the Borrower shall have any obligation under this Note, the Borrower
shall not without the Holder’s written consent redeem, repurchase or otherwise acquire (whether for cash or in exchange for property
or other securities or otherwise) in any one transaction or series of related transactions any shares of capital stock of the Borrower
or any warrants, rights or options to purchase or acquire any such shares.

 

2.5
Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s
written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary course of business. Any
consent to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition, but otherwise such consent
shall not be unreasonably withheld, conditioned, or delayed.

 

    	11

     

    

 

2.6
Advances and Loans; Affiliate Transactions. So long as the Borrower shall have any obligation under this Note, the Borrower shall
not, without the Holder’s written consent, lend money, give credit, make advances to or enter into any transaction with any person,
firm, joint venture or corporation, including, without limitation, officers, directors, employees, subsidiaries and affiliates of the
Borrower, except loans, credits or advances (a) in existence or committed on the Issue Date and which the Borrower has informed Holder
in writing prior to the Issue Date, (b) in regard to transactions with unaffiliated third parties, made in the ordinary course of business,
(c) in regard to transactions with unaffiliated third parties, not in excess of $150,000.00 or (d) in regard to transactions with any
subsidiaries of the Borrower.

 

2.7
Section 3(a)(9) or 3(a)(10) Transaction. So long as this Note is outstanding, the Borrower shall not enter into any transaction
or arrangement structured in accordance with, based upon, or related or pursuant to, in whole or in part, either Section 3(a)(9) of the
Securities Act (a “3(a)(9) Transaction”) or Section 3(a)(l0) of the Securities Act (a “3(a)(l0) Transaction”).
In the event that the Borrower does enter into, or makes any issuance of Common Stock related to a 3(a)(9) Transaction or a 3(a)(l0)
Transaction while this note is outstanding, a liquidated damages charge of twenty-five percent (25%) of the outstanding principal balance
of this Note, but not less than Twenty-Five Thousand Dollars ($25,000), will be assessed and will become immediately due and payable
to the Holder at its election in the form of a cash payment or added to the balance of this Note (under Holder’s and Borrower’s
expectation that this amount will tack back to the Issue Date).

 

2.8
Preservation of Business and Existence, etc. So long as the Borrower shall have any obligation under this Note, the Borrower shall
not, without the Holder’s written consent, (a) change the nature of its business in a material respect; (b) sell, divest, change
the structure of any material assets other than in the ordinary course of business; or (c) enter into any variable rate transactions
or Merchant Cash Advance transactions except as in effect the date hereof. In addition, so long as the Borrower shall have any obligation
under this Note, the Borrower shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence,
rights and privileges, and become or remain, and cause each of its Subsidiaries (other than dormant Subsidiaries that have no or minimum
assets) to become or remain, duly qualified and in good standing in each jurisdiction in which the character of the properties owned
or leased by it or in which the transaction of its business makes such qualification necessary. Furthermore, so long as the Borrower
shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, solicit any offers for,
respond to any unsolicited offers for, or conduct any negotiations with, any other person or entity with respect to any Variable Rate
Transaction or investment.

 

2.9
Non-circumvention. The Borrower hereby covenants and agrees that the Borrower will not, by amendment of its Certificate or Articles
of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution,
issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms
of this Note, and will at all times in good faith carry out all the provisions of this Note and take all action as may be required to
protect the rights of the Holder.

 

2.10
Lost, Stolen or Mutilated Note. Upon receipt by the Borrower of evidence reasonably satisfactory to the Borrower of the loss,
theft, destruction or mutilation of this Note, and, in the case of loss, theft or destruction, of any indemnification undertaking by
the Holder to the Borrower in customary form and, in the case of mutilation, upon surrender and cancellation of this Note, the Borrower
shall execute and deliver to the Holder a new Note.

 

    	12

     

    

 

ARTICLE
III. EVENTS OF DEFAULT

 

It
shall be considered an event of default if any of the following events listed in this Article III (each, an “Event of Default”)
shall occur; provided however, that Borrower shall have two (2) business days to cure, if curable, any Event of Default under
this Note or any of the other Transaction Documents, unless another shorter or longer time period is specified therein:

 

3.1
Conversion and the Shares. The Borrower (i) fails to issue Conversion Shares to the Holder (or announces or threatens in writing
that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder in accordance with
the terms of this Note; (ii) fails to transfer or cause its transfer agent to transfer (issue) (electronically or in certificated form)
any certificate for the Conversion Shares issuable to the Holder upon conversion of or otherwise pursuant to this Note as and when required
by this Note; (iii) fails to reserve the Reserved Amount at all times; or (iv) the Borrower itself, or the Borrower directs its transfer
agent, not to transfer or delays, impairs, or hinders its transfer agent in transferring (or issuing electronically or in certificated
form) any certificate for the Conversion Shares issuable to the Holder upon conversion of or otherwise pursuant to this Note as and when
required by this Note, or fails to remove (or directs its transfer agent not to remove or impairs, delays, 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 Holder upon conversion of, or otherwise pursuant to this Note as and when required by this Note (or makes any written
announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and any such failure
shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded in writing)
for five (5) Trading Days after the Holder shall have delivered a Notice of Conversion. It is an obligation of the Borrower to remain
current in its obligations to its transfer agent. It shall be an Event of Default of this Note, if a conversion of this Note is delayed,
hindered, or frustrated due to a balance owed by the Borrower to its transfer agent. If at the option of the Holder, the Holder advances
any funds to the Borrower’s transfer agent in order to process a conversion, such advanced funds shall be paid by the Borrower
to the Holder, in cash within forty-eight (48) hours of notice from the Holder, or in shares of the Borrower’s Common Stock, in
the Holder’s sole discretion.

 

3.2
Breach of Agreements and Covenants. The Borrower breaches any material agreement, covenant or other material term or condition
contained in the Purchase Agreement, this Note, the Warrant, the Irrevocable Transfer Agent Instructions or in any agreement (other than
the Registration Rights Agreement entered into in connection with this Note and the Purchase Agreement), statement or certificate given
in writing pursuant hereto or in connection herewith or therewith.

 

3.3
Breach of Representations and Warranties. Any material representation or warranty of the Borrower made in the Purchase Agreement,
this Note, the Warrant, the Irrevocable Transfer Agent Instructions or in any agreement, statement or certificate given in writing pursuant
hereto or in connection herewith or therewith shall be false or misleading in any material respect when made and the breach of which
has (or with the passage of time will have).

 

3.4
Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors, or
apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such
a receiver or trustee shall otherwise be appointed, which shall have no cure period.

 

3.5
Judgments. Any money judgment, writ or similar process shall be entered or filed against the Borrower or any subsidiary of the
Borrower or any of its property or other assets for more than

$150,000.00,
and shall remain unvacated, unbonded or unstayed for a period of twenty (20) days unless otherwise consented to by the Holder, which
consent will not be unreasonably withheld.

 

3.6
Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary,
for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any subsidiary
of the Borrower, which shall have no cure period.

 

3.7
Delisting of Common Stock. The Borrower shall fail to maintain the listing of the Common Stock on at least one of any tier of
the OTC Markets, or any tier of the Nasdaq Stock Market or the New York Stock Exchange (including the NYSE American), which shall have
no cure period.

 

    	13

     

    

 

3.8
Failure to Comply with the 1934 Act. At any time after the Issue Date, the Borrower shall fail to comply with the reporting requirements
of the 1934 Act or the Borrower shall cease to be subject to the reporting requirements of the 1934 Act, which shall have no cure period;
provided, however, that the Borrower shall be deemed to have complied with its 1934 Act reporting obligations if such filing is made
within the time period covered by Rule 12b-25 promulgated under the 1934 Act.

 

3.9
Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business, which shall have
no cure period.

 

3.10
Cessation of Operations. Any cessation of operations by Borrower, or Borrower admits it is otherwise generally unable to pay its
debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as a “going
concern” shall not be an admission that the Borrower cannot pay its debts as they become due, which shall have no cure period.

 

3.11
Maintenance of Assets. The failure by Borrower to maintain any material intellectual property rights, personal, real property
or other assets which are necessary to conduct its business (whether now or in the future).

 

3.12
Financial Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC for any date or
period from two (2) years prior to the Issue Date of this Note and until this Note is no longer outstanding, if the result of such restatement
would, by comparison to the un-restated financial statement, have constituted a material adverse effect on the rights of the Holder with
respect to this Note or the Purchase Agreement, which shall have no cure period.

 

3.13
Reverse Splits. The Borrower effectuates a reverse split of its Common Stock without twenty (20) days’ prior written notice
to the Holder, which shall have no cure period.

 

3.14
Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent, the Borrower fails to provide,
prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered
pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved
Amount) signed by the successor transfer agent to Borrower and the Borrower, which shall have no cure period.

 

3.15
DTC “Chill”. The DTC places a “chill” (i.e. a restriction placed by DTC on one or more of DTC’s
services, such as limiting a DTC participant’s ability to make a deposit or withdrawal of the security at DTC) on any of the Borrower’s
securities.

 

3.16
Illegality. Any court of competent jurisdiction issues an order declaring this Note, the Purchase Agreement, or any provision
hereunder or thereunder to be illegal, which shall have no cure period.

 

3.17.
DWAC Eligibility. In addition to the Event of Default in Section 3.15, the Common Stock is otherwise not eligible for trading
through the DTC’s Fast Automated Securities Transfer or Deposit/Withdrawal at Custodian programs, which shall have no cure period.

 

3.18
[Intentionally omitted].

 

3.19
Bid Price. The Borrower shall subsequently lose the “bid” price for its Common Stock ($0.0001 on the “Ask”
with zero market makers on the “Bid” per Level 2) or a market (including the OTC Pink, OTCQB or an equivalent replacement
marketplace or exchange) , which shall have no cure period.

 

    	14

     

    

 

3.20
Inside Information. Any attempt by the Borrower or its officers, directors, or affiliates to intentionally transmit, convey, disclose,
or any actual transmittal, conveyance, or disclosure by the Borrower or its officers, directors, or affiliates of, material non-public
information concerning the Borrower, to the Holder or its successors and assigns, which is not immediately cured by Borrower’s
filing of a Form 8-K pursuant to Regulation FD on that same date.

 

3.21
Unavailability of Rule 144. If, at any time on or after the date which is six (6) months after the Issue Date, except due to the
Holder’s actions or inactions, the Holder is unable to (i) obtain a standard “144 legal opinion letter” from an attorney
reasonably acceptable to the Holder, the Holder’s brokerage firm (and respective clearing firm), and the Borrower’s transfer
agent in order to facilitate the Holder’s conversion of any portion of the Note into free trading shares of the Borrower’s
Common Stock pursuant to Rule 144; or (ii) thereupon deposit such shares into the Holder’s brokerage account, which shall have
no cure period.

 

3.22
Suspension of Trading of Common Stock. If, at any time, the Borrower’s Common Stock (i) is suspended from trading; (ii)
halted from trading; or (iii) fails to be quoted or listed (as applicable) on any level of the OTC Markets, any tier of the NASDAQ Stock
Market, the New York Stock Exchange, (including the NYSE American).

 

3.23
Failure to Make Payment. If upon the Maturity Date, the Borrower shall fail to pay any then outstanding principal, interest, and
fees due hereunder. In addition to the remedies available under Section 3.25, the Conversion Price hereunder shall be set at the Default
Fixed Conversion Price. The adjustment to the Default Fixed Conversion Price shall only apply to an Event of Default under this Section
3.23, which shall have no cure period.

 

3.24
[Intentionally omitted].

 

3.25
Rights and Remedies Upon an Event of Default. Upon the occurrence and during the continuation of any Event of Default specified
in this Article III, this Note shall become immediately due and payable and the Borrower shall pay to the Holder, in full satisfaction
of its obligations hereunder, an amount (the “Default Amount”) equal to the Principal Amount then outstanding plus accrued
interest (including any Default Interest) through the date of full repayment multiplied by one hundred twenty-five percent (125%). Holder
may, in its sole discretion, determine to accept payment part in Common Stock and part in cash. For purposes of payments in Common Stock,
the conversion formula set forth in Section 1.2, including if the Event of Default is pursuant to Section 3.23 hereof, the Default Fixed
Conversion Price. Upon an uncured Event of Default, all amounts payable hereunder shall immediately become due and payable, all without
demand, presentment or notice, all of which hereby are expressly waived by the Borrower, together with all costs, including, without
limitation, legal fees and expenses, of collection, and the Holder shall be entitled to exercise all other rights and remedies available
at law or in equity, including, without limitation.

 

ARTICLE
IV. MISCELLANEOUS

 

4.1
Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other right, power or privileges. All rights and remedies of the Holder existing hereunder
are cumulative to, and not exclusive of, any rights or remedies otherwise available.

 

    	15

     

    

 

4.2
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, e-mail or facsimile, 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 e-mail or facsimile, with accurate confirmation generated by the transmitting facsimile machine,
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:

 

If
to the Borrower, to:

 

SIMPLICITY
ESPORTS AND GAMING COMPANY

7000
West Palmetto Park Road, Suite 505

Boca
Raton, Florida 33433

Attention:
Roman Franklin

e-mail:
roman@simplicityesports.com

 

If
to the Holder:

 

At
the address stated on the

signature
page to the

Securities
Purchase

Agreement

 

 

4.3
Amendments. This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and the
Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument as originally
executed, or if later amended or supplemented, then as so amended or supplemented.

 

4.4
Assignability. This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit
of the Holder and its successors and assigns. The Borrower shall not assign this Note or any rights or obligations hereunder without
the prior written consent of the Holder; the Holder may assign this Note in compliance with all applicable securities laws. Notwithstanding
anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other
lending arrangement. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that following conversion of a portion
of this Note, the unpaid and unconverted principal amount of this Note represented by this Note may be less than the amount stated on
the face hereof.

 

4.5
Cost of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection,
including reasonable attorney’s fees.

 

    	16

     

    

 

4.6
Governing Law; Venue; Attorney’s Fees. This Note shall be governed by and construed in accordance with the laws of the State
of Delaware without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions
contemplated by this Note or any other agreement, certificate, instrument or document contemplated hereby shall be brought only in the
state courts located in the state of New York or federal courts located in the state of New York. The Borrower hereby irrevocably waives
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
BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTIONS CONTEMPLATED HEREBY. 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 Note or any other agreement, certificate, instrument or document contemplated hereby or thereby 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 law. The prevailing
party in any action or dispute brought in connection with this the Note or any other agreement, certificate, instrument or document contemplated
hereby or thereby shall be entitled to recover from the other party its reasonable attorney’s fees and costs.

 

4.7
Certain Amounts. Whenever pursuant to this Note the Borrower is required to pay an amount in excess of the outstanding Principal
Amount (or the portion thereof required to be paid at that time) plus accrued and unpaid interest plus Default Interest on such interest,
the Borrower and the Holder agree that the actual damages to the Holder from the receipt of cash payment on this Note may be difficult
to determine and the amount to be so paid by the Borrower represents stipulated damages and not a penalty and is intended to compensate
the Holder in part for loss of the opportunity to convert this Note and to earn a return from the sale of shares of Common Stock acquired
upon conversion of this Note at a price in excess of the price paid for such shares pursuant to this Note. The Borrower and the Holder
hereby agree that such amount of stipulated damages is not plainly disproportionate to the possible loss to the Holder from the receipt
of a cash payment without the opportunity to convert this Note into shares of Common Stock.

 

4.8
Purchase Agreement. The Borrower and the Holder shall be bound by the applicable terms of the Purchase Agreement and the documents
entered into in connection herewith and therewith.

 

4.9
Notice of Corporate Events. Except as otherwise provided below, the Holder of this Note shall have no rights as a Holder of Common
Stock unless and only to the extent that it converts this Note into Common Stock. The Borrower shall provide the Holder with prior notification
of any meeting of the Borrower’s shareholders (and copies of proxy materials and other information sent to shareholders). In the
event of any taking by the Borrower of a record of its shareholders for the purpose of determining shareholders who are entitled to receive
payment of any dividend or other distribution, any right to subscribe for, purchase or otherwise acquire (including by way of merger,
consolidation, reclassification or recapitalization) any share of any class or any other securities or property, or to receive any other
right, or for the purpose of determining shareholders who are entitled to vote in connection with any Change in Control or any proposed
liquidation, dissolution or winding up of the Borrower, the Borrower shall mail a notice to the Holder, at least twenty (20) days prior
to the record date specified therein (or thirty (30) days prior to the consummation of the transaction or event, whichever is earlier),
of the date on which any such record is to be taken for the purpose of such dividend, distribution, right or other event, and a brief
statement regarding the amount and character of such dividend, distribution, right or other event to the extent known at such time. The
Borrower shall make a public announcement of any event requiring notification to the Holder hereunder substantially simultaneously with
the notification to the Holder in accordance with the terms of this Section 4.9.

 

4.10
Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder,
by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that the remedy at
law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened breach by the
Borrower of the provisions of this Note, that the Holder 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 Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without
any bond or other security being required.

 

    	17

     

    

 

4.11
Construction; Headings. This Note shall be deemed to be jointly drafted by the Borrower and the Holder and shall not be construed
against any person as the drafter hereof. The headings of this Note are for convenience of reference and shall not form part of, or affect
the interpretation of, this Note.

 

4.12
Usury. To the extent it may lawfully do so, the Borrower hereby agrees not to insist upon or plead or in any manner whatsoever
claim, and will resist any and all efforts to be compelled to take the benefit or advantage of, usury laws wherever enacted, now or at
any time hereafter in force, in connection with any action or proceeding that may be brought by the Holder in order to enforce any right
or remedy under this Note. Notwithstanding any provision to the contrary contained in this Note, it is expressly agreed and provided
that the total liability of the Borrower under this Note for payments which under the applicable law are in the nature of interest shall
not exceed the maximum lawful rate authorized under applicable law (the “Maximum Rate”), and, without limiting the foregoing,
in no event shall any rate of interest or default interest, or both of them, when aggregated with any other sums which under the applicable
law in the nature of interest that the Borrower may be obligated to pay under this Note exceed such Maximum Rate. It is agreed that if
the maximum contract rate of interest allowed by applicable law and applicable to this Note is increased or decreased by statute or any
official governmental action subsequent to the Issue Date, the new maximum contract rate of interest allowed by law will be the Maximum
Rate applicable to this Note from the effective date thereof forward, unless such application is precluded by applicable law. If under
any circumstances whatsoever, interest in excess of the Maximum Rate is paid by the Borrower to the Holder with respect to indebtedness
evidenced by this the Note, such excess shall be applied by the Holder to the unpaid principal balance of any such indebtedness or be
refunded to the Borrower, the manner of handling such excess to be at the Holder’s election.

 

4.13
Severability. In the event that any provision of this Note is invalid or unenforceable under any applicable statute or rule of
law (including any judicial ruling), 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 this Note.

 

4.14
Most-Favored Nation. So long as this Note is outstanding, upon any issuance by the Borrower or any of its subsidiaries of any
new security, with any term that the Holder reasonably believes is more favorable to the holder of such security or with a term in favor
of the holder of such security that the Holder reasonably believes was not similarly provided to the Holder in this Note, then (i) the
Holder shall notify the Borrower of such additional or more favorable term within one (1) business day of the issuance or amendment (as
applicable) of the respective security, and (ii) such term, at Holder’s option, shall become a part of the transaction documents
with the Holder (regardless of whether the Borrower complied with the notification provision of this Section 4.14). The types of terms
contained in another security that may be more favorable to the holder of such security include, but are not limited to, terms addressing
conversion discounts, prepayment rate, conversion lookback periods, interest rates, and original issue discounts. If Holder elects to
have the term become a part of the transaction documents with the Holder, then the Borrower shall immediately deliver acknowledgment
of such adjustment in form and substance reasonably satisfactory to the Holder (the “Acknowledgment”) within one (1) business
day of Borrower’s receipt of request from Holder, provided that Borrower’s failure to timely provide the Acknowledgment shall
not affect the automatic amendments contemplated hereby.

 

    	18

     

    

 

4.15
Dispute Resolution. In the case of a dispute as to the determination of the Conversion Price, Conversion Amount, any prepayment
amount or Default Amount, Issue, Closing or Maturity Date, the closing bid price, or fair market value (as the case may be) or the arithmetic
calculation of the Conversion Price or the applicable prepayment amount(s) (as the case may be), the Borrower or the Holder shall submit
the disputed determinations or arithmetic calculations via facsimile (i) within one (1) Trading Day after receipt of the applicable notice
giving rise to such dispute to the Borrower or the Holder or (ii) if no notice gave rise to such dispute, at any time after the Holder
learned of the circumstances giving rise to such dispute. If the Holder and the Borrower are unable to agree upon such determination
or calculation within five (5) Trading Days of such disputed determination or arithmetic calculation (as the case may be) being submitted
to the Borrower or the Holder, then the Borrower shall, within three (3) Trading Days, submit (a) the disputed determination of the Conversion
Price, the closing bid price, the or fair market value (as the case may be) to an independent, reputable investment bank selected by
the Borrower and approved by the Holder or (b) the disputed arithmetic calculation of the Conversion Price, Conversion Amount, any prepayment
amount or Default Amount, to an independent, outside accountant selected by the Holder that is reasonably acceptable to the Borrower.
The Borrower shall cause at its expense the investment bank or the accountant to perform the determinations or calculations and notify
the Borrower and the Holder of the results no later than one (1) Trading Day from the time it receives such disputed determinations or
calculations. Such investment bank’s or accountant’s determination or calculation shall be binding upon all parties absent
demonstrable error.

 

4.16
The Borrower shall not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms to be observed or performed hereunder by the Borrower, but will at all times in good faith assist in the carrying
out of all the provisions of this Section 4.16 and in the taking of all such action as may be necessary or appropriate in order to protect
the conversion rights of the Holder against impairment. In the event the Holder shall elect to convert this Note as provided herein,
the Borrower cannot refuse conversion based on any claim that the Holder or anyone associated or affiliated with the Holder has been
engaged in any violation of law, violation of an agreement to which the Holder is a party or for any reason whatsoever, unless, an injunction
from a court, or notice, restraining and or adjoining conversion of this Note shall have issued and the Borrower posts a surety bond
for the benefit of the Holder in an amount equal to one-hundred- fifty percent (150%) of the Principal Amount of the Note the Holder
has elected to convert, which bond shall remain in effect until the completion of arbitration/litigation of the dispute and the proceeds
of which shall be payable to the Holder (as liquidated damages) in the event it obtains judgment.

 

[SIGNATURE
PAGE FOLLOWS]

 

    	19

     

    

 

IN
WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer on April 1, 2022.

 

	SIMPLICITY
    ESPORTS AND GAMING COMPANY	 
	 	 
	By:	/s/
    Roman Franklin	 
	Name: 
    	Roman
    Franklin	 
	Title:	Chief
    Executive Officer	 

 

    	20

     

    

 

EXHIBIT
A — NOTICE OF CONVERSION

 

The
undersigned hereby elects to convert $principal amount of the Note (defined below) into that number of shares of Common Stock
to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of SIMPLICITY ESPORTS AND GAMING
COMPANY, a Delaware corporation (the “Borrower”), according to the conditions of the Convertible Promissory Note of the
Borrower dated as of April 1, 2022 (the “Note”), as of the date written below. No fee will be charged to the Holder for any
conversion, except for transfer taxes, if any.

 

Box
Checked as to applicable instructions:

 

		☐ 	The
    Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned
    or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”).
	 	 	 
	 	 	Name
    of DTC Prime Broker:
	 	 	Account
    Number:

 

		☐ 	The
    undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth
    below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or,
    if additional space

    is
    necessary, on an attachment hereto:

 

_______________________________

_______________________________

e-mail:   _________________________

 

	 	Date
    of Conversion:	_______________________________
	 	Applicable
    Conversion Price:	$
    	 
	 	Costs
    Incurred by the Undersigned to	 	 
	 	Convert
    the Note into Shares of Common Stock:	$	____________________________
	 	Number
    of Shares of Common Stock to	 	 
	 	be
    Issued Pursuant to Conversion of the Note:	 	____________________________
	 	Amount
    of Principal Balance Due	 	 
	 	remaining	 	____________________________
	 	Under
    the Note after this conversion:	 	 

 

	By:	 	 
	Name:	 	 
	Title:	 	 
	Date:

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