Document:

Exhibit 4.1

    

    

  

  

    THE CHEFS’ WAREHOUSE, INC.

      2019 OMNIBUS EQUITY INCENTIVE PLAN

     

     

    

    

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

        

        

        

        

        

        

        

      

      

    

    
      
        

    

    

    

    TABLE OF CONTENTS

     

    PAGE

     

    	
            Section 1.

          	
            Purpose

          	
            1

          
	 	 	 
	
            Section 2.

          	
            Definitions

          	
            1

          
	 	 	 
	
            Section 3.

          	
            Administration

          	
            5

          
	 	 	 
	
            Section 4.

          	
            Shares Available For Awards

          	
            7

          
	 	 	 
	
            Section 5.

          	
            Eligibility

          	
            8

          
	 	 	 
	
            Section 6.

          	
            Stock Options And Stock Appreciation Rights

          	
            8

          
	 	 	 
	
            Section 7.

          	
            Restricted Shares And Restricted Share Units

          	
            11

          
	 	 	 
	
            Section 8.

          	
            Performance Awards

          	
            13

          
	 	 	 
	
            Section 9.

          	
            Other Stock-Based Awards

          	
            14

          
	 	 	 
	
            Section 10.

          	
            Non-Employee Director And Outside Director Awards

          	
            14

          
	 	 	 
	
            Section 11.

          	
            Separation from Service

          	
            14

          
	 	 	 
	
            Section 12.

          	
            Change In Control

          	
            15

          
	 	 	 
	
            Section 13.

          	
            Amendment And Termination

          	
            16

          
	 	 	 
	
            Section 14.

          	
            General Provisions

          	
            17

          
	 	 	 
	
            Section 15.

          	
            Term Of The Plan

          	
            21

          

    

    

    
      
        

    

    

    THE CHEFS’ WAREHOUSE, INC.

    2019 OMNIBUS EQUITY INCENTIVE PLAN

     

    
      
        	Section 1.	
                Purpose.

              

      

    

     

    This plan shall be known as the “The Chefs’ Warehouse, Inc. 2019 Omnibus Equity Incentive Plan” (the “Plan”).  The purpose of the Plan is
        to promote the interests of The Chefs’ Warehouse, Inc. (the “Company”) and its stockholders by (i) attracting and retaining key officers, employees and directors of, and consultants to, the Company and its Subsidiaries and Affiliates; (ii)
        motivating such individuals by means of performance-related incentives to achieve long-range performance goals; (iii) enabling such individuals to participate in the long-term growth and financial success of the Company; (iv) encouraging ownership
        of stock in the Company by such individuals; and (v) linking their compensation to the long-term interests of the Company and its stockholders.

     

    
      
        	Section 2.	
                Definitions.

              

      

    

     

    As used in the Plan, the following terms shall have the meanings set forth below:

     

    2.1 “Affiliate” means (i) any entity that, directly or indirectly, is
        controlled by the Company, (ii) any entity in which the Company has a significant equity interest, and (iii) an affiliate of the Company, as defined in Rule 12b-2 promulgated under Section 12 of the Exchange Act.

     

    2.2 “Award” means any Option, Stock Appreciation Right, Restricted
        Share Award, Restricted Share Unit, Performance Award, or Other Stock-Based Award granted under the Plan, whether singly, in combination or in tandem, to a Participant by the Committee (or the Board) pursuant to such terms, conditions, restrictions
        and/or limitations, if any, as the Committee (or the Board) may establish.

     

    2.3 “Award Agreement” means any written agreement, contract or other
        instrument or document evidencing any Award, which may, but need not, be executed or acknowledged by a Participant.

     

    2.4 “Board” means the Board of Directors of the Company.

     

    2.5 “Cause” means, unless otherwise defined in the applicable Award
        Agreement, (i) the engaging by the Participant in willful misconduct that is injurious to the business, financial condition or reputation of the Company or its Subsidiaries or Affiliates, or (ii) the embezzlement or misappropriation of funds or
        property of the Company or its Subsidiaries or Affiliates by the Participant.  For purposes of this paragraph, no act, or failure to act, on the Participant’s part shall be considered “willful” unless done, or omitted to be done, by the Participant
        not in good faith and without reasonable belief that the Participant’s action or omission was in the best interest of the Company.  Any determination of Cause for purposes of the Plan or any Award shall be made by the Committee in its sole
        discretion.  Any such determination shall be final and binding on a Participant.

     

    
      
        

    

    

    

    2.6 “Change in Control” means, unless otherwise provided in the
        applicable Award Agreement, the happening of one of the following:

     

    (a) any person or entity, including a “group” as defined in Section 13(d)(3) of the Exchange Act, other than the Company or a wholly-owned Subsidiary thereof
        or any employee benefit plan of the Company or any of its Subsidiaries, becomes the beneficial owner of the Company’s securities having 35% or more of the combined voting power of the then outstanding securities of the Company that may be cast for
        the election of directors of the Company (other than as a result of an issuance of securities initiated by the Company in the ordinary course of business); or

     

    (b) as the result of, or in connection with, any cash tender or exchange offer, merger or other business combination, sale of assets or contested election, or
        any combination of the foregoing transactions, less than a majority of the combined voting power of the then outstanding securities of the Company or any successor corporation or entity entitled to vote generally in the election of the directors of
        the Company or such other corporation or entity after such transaction are held in the aggregate by the holders of the Company’s securities entitled to vote generally in the election of directors of the Company immediately prior to such
        transaction; or

     

    (c) during any period of two consecutive years, individuals who at the beginning of any such period constitute the Board cease for any reason to constitute at
        least a majority thereof, unless the election, or the nomination for election by the Company’s stockholders, of each director of the Company first elected during such period was approved by a vote of at least two-thirds of the directors of the
        Company then still in office who were directors of the Company at the beginning of any such period.

     

    Notwithstanding the foregoing, unless otherwise provided in the applicable Award Agreement, with respect to Awards subject to Section 409A
        of the Code, a Change in Control shall mean a “change in the ownership of the Company,” a “change in the effective control of the Company,” or a “change in the ownership of a substantial portion of the assets of the Company” as such terms are
        defined in Section 1.409A-3(i)(5) of the Treasury Regulations.

     

    2.7 “Code” means the Internal Revenue Code of 1986, as amended from
        time to time.

     

    2.8 “Committee” means a committee of the Board composed of not less
        than two Non-Employee Directors, each of whom shall be (i) a “non-employee director” for purposes of Exchange Act Section 16 and Rule 16b-3 thereunder and (ii) “independent” within the meaning of the listing standards of the Nasdaq Stock Market.

     

    2.9 “Consultant” means any consultant to the Company or its
        Subsidiaries or Affiliates.

     

    2.10 “Director” means a member of the Board.

     

    2.11 “Disability” means, unless otherwise defined in the applicable
        Award Agreement, a disability that would qualify as a total and permanent disability under the Company’s then current long-term disability plan.  With respect to Awards subject to Section 409A of the Code, unless otherwise defined in the applicable
        Award Agreement, the term “Disability” shall have the meaning set forth in Section 409A of the Code.

     

    
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    2.12 “Early Retirement” means, unless otherwise provided in an Award
        Agreement, retirement with the express consent of the Committee at or before the time of such retirement, from active employment with the Company and any Subsidiary or Affiliate prior to age 65, in accordance with any applicable early retirement
        policy of the Company then in effect or as may be approved by the Committee.

     

    2.13 “Effective Date” has the meaning provided in Section 15.1 of the Plan.

     

    2.14 “Employee” means a current or prospective officer or employee of
        the Company or of any Subsidiary or Affiliate.

     

    2.15 “Exchange Act” means the Securities Exchange Act of 1934, as
        amended from time to time.

     

    2.16 “Fair Market Value” with respect to the Shares, means, for
        purposes of a grant of an Award as of any date, (i) the reported closing sales price of the Shares on the Nasdaq Stock Market, or any other such market or exchange as is the principal trading market for the Shares, on such date, or in the absence
        of reported sales on such date, the closing sales price on the immediately preceding date on which sales were reported or (ii) in the event there is no public market for the Shares on such date, the fair market value as determined, in good faith
        and by the reasonable application of a reasonable valuation method (as applicable), by the Committee in its sole discretion, and for purposes of a sale of a Share as of any date, the actual sales price on that date.

     

    2.17 “Good Reason” means, unless otherwise provided in an Award
        Agreement, (i) a material reduction in a Participant’s position, authority, duties or responsibilities following a Change in Control as compared to such level immediately prior to a Change in Control, (ii) any material reduction in a Participant’s
        annual base salary as in effect immediately prior to a Change in Control; (iii) the relocation of the office at which the Participant is to perform the majority of his or her duties following a Change in Control to a location more than 30 miles
        from the location at which the Participant performed such duties prior to the Change in Control; or (iv) the failure by the Company or its successor to continue to provide the Participant with benefits substantially similar in aggregate value to
        those enjoyed by the Participant under any of the Company’s pension, life insurance, medical, health and accident or disability plans in which Participant was participating immediately prior to a Change in Control, unless the Participant is offered
        participation in other comparable benefit plans generally available to similarly situated employees of the Company or its successor after the Change in Control.

     

    2.18 “Grant Price” means the price established at the time of grant of
        an SAR pursuant to Section 6 used to determine whether there is any payment due upon exercise of the SAR.

     

    
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    2.19 “Incentive Stock Option” means an option to purchase Shares from
        the Company that is granted under Section 6 of the Plan and that is intended to meet the requirements of Section 422 of the Code or any successor provision thereto.

     

    2.20 “Non-Employee Director” means a member of the Board who is not an
        officer or employee of the Company or any Subsidiary or Affiliate.

     

    2.21 “Non-Qualified Stock Option” means an option to purchase Shares
        from the Company that is granted under Sections 6 or 10 of the Plan and is not intended to
        be an Incentive Stock Option.

     

    2.22 “Normal Retirement” means, unless otherwise defined in the
        applicable Award Agreement, retirement of a Participant from active employment with the Company or any of its Subsidiaries or Affiliates on or after such Participant’s 65th birthday.

     

    2.23 “Option” means an Incentive Stock Option or a Non-Qualified Stock
        Option.

     

    2.24 “Option Price” means the purchase price payable to purchase one
        Share upon the exercise of an Option.

     

    2.25 “Other Stock-Based Award” means any Award granted under Sections 9 or 10 of the Plan.  For purposes of the share counting provisions of Section 4.1 hereof, an Other Stock-Based Award that is not settled in cash shall be treated as (i) an Option Award if the amounts payable thereunder will be determined by
        reference to the appreciation of a Share, and (ii) a Restricted Share Award if the amounts payable thereunder will be determined by reference to the full value of a Share.

     

    2.26 “Outside Director” means, with respect to the grant of an Award,
        a member of the Board then serving on the Committee.

     

    2.27 “Participant” means any Employee, Director, Consultant or other
        person who receives an Award under the Plan.

     

    2.28 “Performance Award” means any Award granted under Section 8 of the Plan.  For purposes of the share counting provisions of Section 4.1 hereof, a
        Performance Award that is not settled in cash shall be treated as (i) an Option Award if the amounts payable thereunder will be determined by reference to the appreciation of a Share, and (ii) a Restricted Share Award if the amounts payable
        thereunder will be determined by reference to the full value of a Share.

     

    2.29 “Person” means any individual, corporation, partnership, limited
        liability company, association, joint-stock company, trust, unincorporated organization, government or political subdivision thereof or other entity.

     

    2.30 “Registration Date” means the time that the registration
        statement on Form S-1 of Chefs’ Warehouse Holdings, LLC, predecessor to the Company, becomes effective.

     

    2.31 “Restricted Share” means any Share granted under Sections 7 to 10 of the Plan.

     

    
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    2.32 “Restricted Share Unit” means any unit granted under Sections 7 to 10 of the Plan.

     

    2.33 “Retirement” means Normal or Early Retirement.

     

    2.34 “SEC” means the Securities and Exchange Commission or any
        successor thereto.

     

    2.35 “Section 16” means Section 16 of the Exchange Act and the rules
        promulgated thereunder and any successor provision thereto as in effect from time to time.

     

    2.36  “Separation from Service” or “Separates from Service” shall have the meaning ascribed to such term pursuant to Section 409A of the Code and the regulations promulgated thereunder.

     

    2.37 “Shares” means shares of the common stock, no par value per
        share, of the Company.

     

    2.38 “Share Reserve” has the meaning set forth in Section 4.1 hereof.

     

    2.39 “Specified Employee” has the meaning ascribed to such term
        pursuant to Section 409A of the Code and the regulations promulgated thereunder.

     

    2.40 “Stock Appreciation Right” or “SAR” means a stock appreciation right granted under Sections 6, 8 or 10 of the Plan that entitles the holder to receive, with respect to each Share encompassed by the exercise of such SAR, the
        amount determined by the Committee and specified in an Award Agreement.  In the absence of such a determination, the holder shall be entitled to receive, with respect to each Share encompassed by the exercise of such SAR, the excess of the Fair
        Market Value of such Share on the date of exercise over the Grant Price.

     

    2.41 “Subsidiary” means any Person (other than the Company) of which
        50% or more of its voting power or its equity securities or equity interest is owned directly or indirectly by the Company.

     

    2.42 “Substitute Awards” means Awards granted solely in assumption of,
        or in substitution for, outstanding awards previously granted by a company acquired by the Company or with which the Company combines.

     

    
      
        	Section 3.	
                Administration.

              

      

    

     

    3.1 Authority of Committee.  The Plan shall be administered by a
        Committee, which shall be appointed by and serve at the pleasure of the Board; provided, however, with respect to Awards to Outside Directors, all references in the Plan to the Committee shall be deemed to be references to the Board.  Subject to
        the terms of the Plan and applicable law, and in addition to other express powers and authorizations conferred on the Committee by the Plan, the Committee shall have full power and authority in its discretion (and in accordance with Section 409A of
        the Code with respect to Awards subject thereto) to: (i) designate Participants; (ii) determine eligibility for participation in the Plan and decide all questions concerning eligibility for and the amount of Awards under the Plan; (iii) determine
        the type or types of Awards to be granted to a Participant;

     

    
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    (iv) determine the number of Shares to be covered by, or with respect to which payments, rights or other matters are to be calculated in connection with
        Awards; (v) determine the timing, terms, and conditions of any Award; (vi) accelerate the time at which all or any part of an Award may be settled or exercised;(vii) determine whether, to what extent, and under what circumstances Awards may be
        settled or exercised in cash, Shares, other securities, other Awards or other property, or canceled, forfeited or suspended and the method or methods by which Awards may be settled, exercised, canceled, forfeited or suspended; (viii) determine
        whether, to what extent, and under what circumstances cash, Shares, other securities, other Awards, other property, and other amounts payable with respect to an Award shall be deferred either automatically or at the election of the holder thereof
        or of the Committee; (ix) grant Awards as an alternative to, or as the form of payment for grants or rights earned or payable under, other bonus or compensation plans, arrangements or policies of the Company or a Subsidiary or Affiliate; (x) grant
        Substitute Awards on such terms and conditions as the Committee may prescribe, subject to compliance with the Incentive Stock Option rules under Section 422 of the Code and the nonqualified deferred compensation rules under Section 409A of the
        Code, where applicable; (xi) make all determinations under the Plan concerning any Participant’s Separation from Service with the Company or a Subsidiary or Affiliate, including whether such separation occurs by reason of Cause, Good Reason,
        Disability, Retirement, or in connection with a Change in Control and whether a leave constitutes a Separation from Service; (xii) interpret and administer the Plan and any instrument or agreement relating to, or Award made under, the Plan; (xiii)
        except to the extent prohibited by Section 6.2, amend or modify the terms of any Award at or after grant with the consent of the holder of the Award; (xiv) establish,
        amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; and (xv) make any other determination and take any other action that the Committee deems necessary or
        desirable for the administration of the Plan, subject to the exclusive authority of the Board under Section 13 hereunder to amend or terminate the Plan.

     

      

    3.2 Committee Discretion Binding.  Unless otherwise expressly
        provided in the Plan, all designations, determinations, interpretations, and other decisions under or with respect to the Plan or any Award shall be within the sole discretion of the Committee, may be made at any time and shall be final,
        conclusive, and binding upon all Persons, including the Company, any Subsidiary or Affiliate, any Participant and any holder or beneficiary of any Award.  A Participant or other holder of an Award may contest a decision or action by the Committee
        with respect to such person or Award only on the grounds that such decision or action was arbitrary or capricious or was unlawful, and any review of such decision or action shall be limited to determining whether the Committee’s decision or action
        was arbitrary or capricious or was unlawful.

     

    3.3 Delegation.  Subject to the terms of the Plan and applicable law,
        the Committee may delegate to one or more officers or managers of the Company or of any Subsidiary or Affiliate, or to a Committee of such officers or managers, the authority, subject to such terms and limitations as the Committee shall determine,
        to grant Awards to or to cancel, modify or waive rights with respect to, or to alter, discontinue, suspend or terminate Awards held by Participants who are not officers or directors of the Company for purposes of Section 16 or who are otherwise not
        subject to such Section.

     

    
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    3.4 No Liability.  No member of the Board or Committee shall be
        liable for any action taken or determination made in good faith with respect to the Plan or any Award granted hereunder.

     

    
      
        	Section 4.	
                Shares Available For Awards.

              

      

    

     

    4.1 Shares Available.  Subject to the provisions of Section 4.2 below, the maximum aggregate number of Shares which may be issued pursuant to all Awards after the Effective Date of the Plan is 2,600,000 Shares (the “Share
        Reserve”).  The number of Shares with respect to which Incentive Stock Options may be granted shall be no more than 2,600,000 Shares.  Each Share issued pursuant to an Option shall reduce the Share Reserve by one (1) share.  Each Share subject to a
        redeemed portion of a SAR shall reduce the Share Reserve by one (1) share.  Each Share issued pursuant to a Restricted Stock Award or a Restricted Stock Unit Award shall reduce the Share Reserve by one (1) share.  If any Award granted under the
        Plan (whether before or after the Effective Date of the Plan) shall expire, terminate, be settled in cash (in whole or in part) or otherwise be forfeited or canceled for any reason before it has vested or been exercised in full, the Shares subject
        to such Award shall, to the extent of such expiration, cash settlement, forfeiture, or termination, again be available for Awards under the Plan, in accordance with this Section 4.1. 
        The Committee may make such other determinations regarding the counting of Shares issued pursuant to the Plan as it deems necessary or advisable, provided that such determinations shall be permitted by law.  Notwithstanding the foregoing, if an
        Option or SAR is exercised, in whole or in part, by tender of Shares or if the Company’s tax withholding obligation is satisfied by withholding Shares, the number of Shares deemed to have been issued under the Plan for purposes of the limitation
        set forth in this Section 4.1 shall be the number of Shares that were subject to the Option or SAR or portion thereof, and not the net number of Shares actually issued
        and any SARs to be settled in Shares shall be counted in full against the number of Shares available for issuance under the Plan, regardless of the number of shares issued upon the settlement of the SAR.  Any Shares that again become available for
        grant pursuant to this Section shall be added back as (i) one (1) Share if such Shares were subject to Options or Stock Appreciation Rights granted under the Plan, and (ii) as one (1) Share if such Shares were subject to Awards other than Options
        or Stock Appreciation Rights granted under the Plan.  Notwithstanding the foregoing and subject to adjustment as provided in Section 4.2 hereof, no Participant may
        receive Options or SARs under the Plan in any calendar year that, taken together, relate to more than 200,000 Shares.

     

    4.2 Adjustments.  Without limiting the Committee’s discretion as
        provided in Section 12 hereof, in the event that the Committee determines that any dividend or other distribution (whether in the form of cash, Shares, other securities
        or other property, and other than a normal cash dividend), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of Shares or other securities of the
        Company, issuance of warrants or other rights to purchase Shares or other securities of the Company, or other similar corporate transaction or event affects the Shares, then the Committee shall, in an equitable and proportionate manner as
        determined by the Committee (and, as applicable, in such manner as is consistent with 422 and 409A of the Code and the regulations thereunder) either: (i) adjust any or all of (1) the aggregate number of Shares or other securities of the Company
        (or number and kind of other securities or property) with respect to which Awards may be granted under the Plan;

     

    
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    (2) the number of Shares or other securities of the Company (or number and kind of other securities or property) subject to outstanding Awards under the Plan,
        provided that the number of Shares subject to any Award shall always be a whole number; (3) the grant or exercise price with respect to any Award under the Plan, and (4) the limits on the number of Shares or Awards that may be granted to
        Participants under the Plan in any calendar year; (ii) provide for an equivalent award in respect of securities of the surviving entity of any merger, consolidation or other transaction or event having a similar effect; or (iii) make provision for
        a cash payment to the holder of an outstanding Award.  Any such adjustments to outstanding Awards shall be effected in a manner that precludes the material enlargement of rights and benefits under such Awards.

    

    

    4.3 Substitute Awards.  Any Shares issued by the Company as
        Substitute Awards in connection with the assumption or substitution of outstanding grants from any acquired corporation shall not reduce the Shares available for Awards under the Plan.

     

    4.4 Sources of Shares Deliverable Under Awards.  Any Shares delivered
        pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares or of issued Shares which have been reacquired by the Company.

     

    
      
        	Section 5.	
                Eligibility.

              

      

    

     

    Any Employee, Director or Consultant shall be eligible to be designated a Participant; provided, however, that Outside Directors shall only
        be eligible to receive Awards granted consistent with Section 10.

     

    
      
        	Section 6.	
                Stock Options And Stock Appreciation Rights.

              

      

    

     

    6.1 Grant.  Subject to the provisions of the Plan, the Committee
        shall have sole and complete authority to determine the Participants to whom Options and SARs shall be granted, the number of Shares subject to each Award, the exercise price and the conditions and limitations applicable to the exercise of each
        Option and SAR.  An Option may be granted with or without a related SAR.  An SAR may be granted with or without a related Option.  The grant of an Option or SAR shall occur when the Committee by resolution, written consent or other appropriate
        action determines to grant such Option or SAR for a particular number of Shares to a particular Participant at a particular Option Price or Grant Price, as the case may be, or such later date as the Committee shall specify in such resolution,
        written consent or other appropriate action.  The Committee shall have the authority to grant Incentive Stock Options and to grant Non-Qualified Stock Options.  In the case of Incentive Stock Options, the terms and conditions of such grants shall
        be subject to and comply with Section 422 of the Code, as from time to time amended, and any regulations implementing such statute.  To the extent the aggregate Fair Market Value (determined at the time the Incentive Stock Option is granted) of the
        Shares with respect to which all Incentive Stock Options are exercisable for the first time by an Employee during any calendar year (under all plans described in Section 422(d) of the Code of the Employee’s employer corporation and its parent and
        Subsidiaries) exceeds $100,000, such Options shall be treated as Non-Qualified Stock Options.

     

    6.2 Price.  The Committee in its sole discretion shall establish the
        Option Price at the time each Option is granted and the Grant Price at the time each SAR is granted.

     

    
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    Except in the case of Substitute Awards, the Option Price of an Option may not be less than the Fair Market Value of a Share on the date of grant of such
        Option, and the Grant Price of an SAR may not be less than the Fair Market Value of a Share on the date of grant of such SAR.  In the case of Substitute Awards or Awards granted in connection with an adjustment provided for in Section 4.2 hereof in the form of Options or SARS, such grants shall have an Option Price (or Grant Price) per Share that is intended to maintain the economic value of the
        Award that was replaced or adjusted as determined by the Committee.  Notwithstanding the foregoing and except as permitted by the provisions of Section 4.2 hereof, the
        Committee shall not have the power to (i) amend the terms of previously granted Options to reduce the Option Price of such Options, (ii) amend the terms of previously granted SARs to reduce the Grant Price of such SARs, (iii) cancel such Options
        and grant substitute Options with a lower Option Price than the cancelled Options, or (iv) cancel such SARs and grant substitute SARs with a lower Grant Price than the cancelled SARs, in each case without the approval of the Company’s stockholders.

    

    

    6.3 Term.  Subject to the Committee’s authority under Section 3.1 and the provisions of Section 6.6, each Option and SAR and all rights and obligations
        thereunder shall expire on the date determined by the Committee and specified in the Award Agreement.  The Committee shall be under no duty to provide terms of like duration for Options or SARs granted under the Plan.  Notwithstanding the
        foregoing, but subject to Section 6.4(a) hereof, no Option or SAR shall be exercisable after the expiration of ten (10) years from the date such Option or SAR was
        granted.

     

    6.4 Exercise.

     

    (a) Subject to Section 14.3, each Option and SAR shall be exercisable at such
        times and subject to such terms and conditions as the Committee may, in its sole discretion, specify in the applicable Award Agreement or thereafter.  The Committee shall have full and complete authority to determine, subject to Section 6.6 herein, whether an Option or SAR will be exercisable in full at any time or from time to time during the term of the Option or SAR, or to provide for the exercise
        thereof in such installments, upon the occurrence of such events and at such times during the term of the Option or SAR as the Committee may determine.  An Award Agreement may provide that the period of time over which an Option, other than an
        Incentive Stock Option, or SAR may be exercised shall be automatically extended if on the scheduled expiration of such Award, the Participant’s exercise of such Award would, in the reasonable judgment of the Company, violate applicable securities
        law or would be prohibited by a Company “blackout” policy; provided, however, that during the extended exercise period the Option or SAR may only be exercised to the extent such Award was exercisable in accordance with its terms immediately prior
        to such scheduled expiration date; provided further, however, that such extended exercise period shall end not later than thirty (30) days after the exercise of such Option or SAR first would no longer violate such laws or policy.

     

    (b) The Committee may impose such conditions with respect to the exercise of Options or SARs, including without limitation, any relating to the application of
        federal, state or foreign securities laws or the Code, as it may deem necessary or advisable.  The exercise of any Option granted hereunder shall be effective only at such time as the sale of Shares pursuant to such exercise will not violate any
        state or federal securities or other laws.

     

    
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    (c) An Option or SAR may be exercised in whole or in part at any time, with respect to whole Shares only, within the period permitted thereunder for the
        exercise thereof, and shall be exercised by written notice of intent to exercise the Option or SAR, delivered to the Company at its principal office, and payment in full to the Company at the direction of the Committee of the amount of the Option
        Price for the number of Shares with respect to which the Option is then being exercised.

     

    (d) Payment of the Option Price shall be made in (i) cash or cash equivalents, (ii) at the discretion of the Committee, by transfer, either actually or by
        attestation, to the Company of unencumbered Shares previously acquired by the Participant, valued at the Fair Market Value of such Shares on the date of exercise (or next succeeding trading date, if the date of exercise is not a trading date),
        together with any applicable withholding taxes, such transfer to be upon such terms and conditions as determined by the Committee, (iii) by a combination of (i) or (ii), or (iv) by any other method approved or accepted by the Committee in its sole
        discretion, including, if the Committee so determines, (x) a cashless (broker-assisted) exercise or (y) withholding Shares (net-exercise) otherwise deliverable to the Participant pursuant to the Option having an aggregate Fair Market Value at the
        time of exercise equal to the total Option Price.  Until the optionee has been issued the Shares subject to such exercise, he or she shall possess no rights as a stockholder with respect to such Shares.  The Company reserves, at any and all times
        in the Company’s sole discretion, the right to establish, decline to approve or terminate any program or procedures for the exercise of Options by means of a method set forth in subsection (iv) above, including with respect to one or more
        Participants specified by the Company notwithstanding that such program or procedures may be available to other Participants.

     

    (e) At the Committee’s discretion, the amount payable as a result of the exercise of an SAR may be settled in cash, Shares or a combination of cash and
        Shares.  A fractional Share shall not be deliverable upon the exercise of a SAR but a cash payment will be made in lieu thereof.

     

    6.5 Separation from Service.  Except as otherwise provided in the
        applicable Award Agreement, an Option or SAR may be exercised only to the extent that it is then exercisable, and if at all times during the period beginning with the date of granting such Award and ending on the date of exercise of such Award the
        Participant is an Employee, Non-Employee Director or Consultant, and shall terminate immediately upon a Separation from Service by the Participant.  An Option or SAR shall cease to become exercisable upon a Separation from Service of the holder
        thereof.  Notwithstanding the foregoing provisions of this Section 6.5 to the contrary, the Committee may determine in its discretion that an Option or SAR may be
        exercised following any such Separation from Service, whether or not exercisable at the time of such separation; provided, however, that in no event may an Option or SAR be exercised after the expiration date of such Award specified in the
        applicable Award Agreement, except as provided in Section 6.4(a).

     

    
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    6.6 Ten Percent Stock Rule.  Notwithstanding any other provisions in
        the Plan, if at the time an Option is otherwise to be granted pursuant to the Plan, the optionee or rights holder owns directly or indirectly (within the meaning of Section 424(d) of the Code) Shares of the Company possessing more than ten percent
        (10%) of the total combined voting power of all classes of Stock of the Company or its parent or Subsidiary or Affiliate corporations (within the meaning of Section 422(b)(6) of the Code), then any Incentive Stock Option to be granted to such
        optionee or rights holder pursuant to the Plan shall satisfy the requirement of Section 422(c)(5) of the Code, and the Option Price shall be not less than one hundred ten percent (110%) of the Fair Market Value of the Shares of the Company, and
        such Option by its terms shall not be exercisable after the expiration of five (5) years from the date such Option is granted.

     

    
      
        	Section 7.	
                Restricted Shares And Restricted Share Units.

              

      

    

     

    7.1 Grant.

     

    (a) Subject to the provisions of the Plan, the Committee shall have sole and complete authority to determine the Participants to whom Restricted Shares and
        Restricted Share Units shall be granted, the number of Restricted Shares and/or the number of Restricted Share Units to be granted to each Participant, the duration of the period during which, and the conditions under which, the Restricted Shares
        and Restricted Share Units may be forfeited to the Company, and the other terms and conditions of such Awards.  The Restricted Share and Restricted Share Unit Awards shall be evidenced by Award Agreements in such form as the Committee shall from
        time to time approve, which agreements shall comply with and be subject to the terms and conditions provided hereunder and any additional terms and conditions established by the Committee that are consistent with the terms of the Plan.

     

    (b) Each Restricted Share and Restricted Share Unit Award made under the Plan shall be for such number of Shares as shall be determined by the Committee and
        set forth in the Award Agreement containing the terms of such Restricted Share or Restricted Share Unit Award.  Such agreement shall set forth a period of time (not less than one year) during which the grantee must remain in the continuous
        employment (or other service-providing capacity) of the Company in order for the forfeiture and transfer restrictions to lapse.  If the Committee so determines, the restrictions may lapse during such restricted period in installments with respect
        to specified portions of the Shares covered by the Restricted Share or Restricted Share Unit Award.  The Award Agreement may also, in the discretion of the Committee, set forth performance or other conditions that will subject the Shares to
        forfeiture and transfer restrictions.  The Committee may, at its discretion, waive all or any part of the restrictions applicable to any or all outstanding Restricted Share and Restricted Share Unit Awards.

     

    7.2 Delivery of Shares and Transfer Restrictions.

     

    (a) At the time a Restricted Share Award is granted, a certificate representing the number of Shares awarded thereunder shall be registered in the name of the
        grantee.  Such certificate shall be held by the Company or any custodian appointed by the Company for the account of the grantee subject to the terms and conditions of the Plan, and shall bear such a legend setting forth the restrictions imposed
        thereon as the Committee, in its discretion, may determine.

     

    
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    The foregoing to the contrary notwithstanding, the Committee may, in its discretion, provide that a Participant’s ownership of Restricted
        Shares prior to the lapse of any transfer restrictions or any other applicable restrictions shall, in lieu of such certificates, be evidenced by a “book entry” (i.e.,
        a computerized or manual entry) in the records of the Company or its designated agent in the name of the Participant who has received such Award, and confirmation and account statements sent to the Participant with respect to such book-entry Shares
        may bear the restrictive legend referenced in the preceding sentence.  Such records of the Company or such agent shall, absent manifest error, be binding on all Participants who receive Restricted Share Awards evidenced in such manner.  The holding
        of Restricted Shares by the Company or such an escrow holder, or the use of book entries to evidence the ownership of Restricted Shares, in accordance with this Section 7.2(a),
        shall not affect the rights of Participants as owners of the Restricted Shares awarded to them, nor affect the restrictions applicable to such shares under the Award Agreement or the Plan, including the transfer restrictions.

    

    

    (b) Unless otherwise provided in the applicable Award Agreement, the grantee shall have all rights of a stockholder with respect to the Restricted Shares,
        including the right to receive dividends and the right to vote such Shares, subject to the following restrictions: (i) the grantee shall not be entitled to delivery of the stock certificate until the expiration of the restricted period and the
        fulfillment of any other restrictive conditions set forth in the Award Agreement with respect to such Shares; (ii) none of the Shares may be sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or disposed of during such
        restricted period or until after the fulfillment of any such other restrictive conditions; (iii) except as otherwise determined by the Committee at or after grant, all of the Shares shall be forfeited and all rights of the grantee to such Shares
        shall terminate, without further obligation on the part of the Company, unless the grantee remains in the continuous employment of the Company for the entire restricted period in relation to which such Shares were granted and unless any other
        restrictive conditions relating to the Restricted Share Award are met; and (iv) dividends declared and paid on Restricted Shares during such restricted period shall be retained by the Company and paid to the grantee upon the satisfaction of the
        continuous employment and any other restrictive conditions relating to such Restricted Shares.  Restricted Share Units shall be subject to similar transfer restrictions as Restricted Share Awards, except that no Shares are actually awarded to a
        Participant who is granted Restricted Share Units on the date of grant, and such Participant shall have no rights of a stockholder with respect to such Restricted Share Units until the restrictions set forth in the applicable Award Agreement have
        lapsed.

     

    7.3 Termination of Restrictions.  At the end of the restricted period
        and provided that any other restrictive conditions of the Restricted Share Award are met, or at such earlier time as otherwise determined by the Committee, all restrictions set forth in the Award Agreement relating to the Restricted Share Award or
        in the Plan shall lapse as to the Restricted Shares subject thereto, and a stock certificate for the appropriate number of Shares, free of the restrictions and restricted stock legend, shall be delivered to the Participant or the Participant’s
        beneficiary or estate, as the case may be (or, in the case of book-entry Shares, such restrictions and restricted stock legend shall be removed from the confirmation and account statements delivered to the Participant or the Participant’s
        beneficiary or estate, as the case may be, in book-entry form).

     

    
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    7.4 Payment of Restricted Share Units.  Each Restricted Share Unit
        shall have a value equal to the Fair Market Value of a Share.  Restricted Share Units may be paid in cash, Shares, other securities or other property, as determined in the sole discretion of the Committee, upon the lapse of the restrictions
        applicable thereto, or otherwise in accordance with the applicable Award Agreement.  The applicable Award Agreement shall specify whether a Participant will be entitled to receive dividend equivalent rights in respect of Restricted Share Units at
        the time of any payment of dividends to stockholders on Shares.  If the applicable Award Agreement specifies that a Participant will be entitled to dividend equivalent rights, (i) the amount of any such dividend equivalent right shall equal the
        amount that would be payable to the Participant as a stockholder in respect of a number of Shares equal to the number of vested Restricted Share Units then credited to the Participant, and (ii) any such dividend equivalent right shall be paid in
        accordance with the Company’s payment practices as may be established from time to time and as of the date on which such dividend would have been payable in respect of outstanding Shares (and in accordance with Section 409A of the Code with regard
        to Awards subject thereto); provided, that no dividend equivalents shall be paid on Restricted Share Units that have not vested and such dividend equivalents shall instead accumulate and be paid upon vesting of the Restricted Share Units to which
        they relate.  Except as otherwise determined by the Committee at or after grant, Restricted Share Units may not be sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or disposed of, and all Restricted Share Units and all
        rights of the grantee to such Restricted Share Units shall terminate, without further obligation on the part of the Company, unless the grantee remains in continuous employment of the Company for the entire restricted period in relation to which
        such Restricted Share Units were granted and unless any other restrictive conditions relating to the Restricted Share Unit Award are met.

     

    
      
        	Section 8.	
                Performance Awards.

              

      

    

     

    8.1 Grant.  The Committee shall have sole and complete authority to
        determine the Participants who shall receive a Performance Award, which shall consist of a right that is (i) denominated in cash or Shares (including but not limited to Restricted Shares and Restricted Share Units), (ii) valued, as determined by
        the Committee, in accordance with the achievement of such performance goals during such performance periods as the Committee shall establish, and (iii) payable at such time and in such form as the Committee shall determine.

     

    8.2 Terms and Conditions.  Subject to the terms of the Plan and any
        applicable Award Agreement, the Committee shall determine the performance goals to be achieved during any performance period, the length of any performance period, the amount of any Performance Award and the amount and kind of any payment or
        transfer to be made pursuant to any Performance Award, and may amend specific provisions of the Performance Award; provided, however, that such amendment may not adversely affect existing Performance Awards made within a performance period
        commencing prior to implementation of the amendment.

     

    8.3 Payment of Performance Awards.  Performance Awards may be paid in
        a lump sum or in installments following the close of the performance period or, in accordance with the procedures established by the Committee, on a deferred basis.

     

    
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    Separation from Service prior to the end of any performance period, other than for reasons of death or Disability, will result in the forfeiture of the
        Performance Award, and no payments will be made.  Notwithstanding the foregoing, the Committee may in its discretion, waive any performance goals and/or other terms and conditions relating to a Performance Award.  A Participant’s rights to any
        Performance Award may not be sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or disposed of in any manner, except by will or the laws of descent and distribution, and/or except as the Committee may determine at or after
        grant.

    

    

    
      
        	Section 9.	
                Other Stock-Based Awards.

              

      

    

     

    The Committee shall have the authority to determine the Participants who shall receive an Other Stock-Based Award, which shall consist of
        any right that is (i) not an Award described in Sections 6 and 7 above and (ii) an Award of
        Shares or an Award denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, Shares (including, without limitation, securities convertible into Shares), as deemed by the Committee to be consistent
        with the purposes of the Plan.  Subject to the terms of the Plan and any applicable Award Agreement, the Committee shall determine the terms and conditions of any such Other Stock-Based Award.

     

    
      
        	Section 10.	
                Non-Employee Director And Outside Director Awards.

              

      

    

     

    10.1 The Board may provide that all or a portion of a Non-Employee Director’s annual retainer, meeting fees and/or other awards or compensation as determined by
        the Board, be payable (either automatically or at the election of a Non-Employee Director) in the form of Non-Qualified Stock Options, Restricted Shares, Restricted Share Units and/or Other Stock-Based Awards, including unrestricted Shares.  The
        Board shall determine the terms and conditions of any such Awards, including the terms and conditions which shall apply upon a termination of the Non-Employee Director’s service as a member of the Board, and shall have full power and authority in
        its discretion to administer such Awards, subject to the terms of the Plan and applicable law.

     

    10.2 The Board may also grant Awards to Outside Directors pursuant to the terms of the Plan, including any Award described in Sections 6, 7 and 9 above.  With respect to
        such Awards, all references in the Plan to the Committee shall be deemed to be references to the Board.

     

    
      
        	Section 11.	
                Separation from Service.

              

      

    

     

    The Committee shall have the full power and authority to determine the terms and conditions that shall apply to any Award upon a Separation
        from Service with the Company, its Subsidiaries and Affiliates, including a separation from the Company with or without Cause, by a Participant voluntarily, or by reason of death, Disability, Early Retirement or Retirement, and may provide such
        terms and conditions in the Award Agreement or in such rules and regulations as it may prescribe.

     

    
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        	Section 12.	
                Change In Control.

              

      

    

     

    12.1 Certain Terminations.  Unless otherwise provided by the
        Committee, or in an Award Agreement or by a contractual agreement between the Company and a Participant, if, within one year following a Change in Control, a Participant Separates from Service with the Company (or its successor) by reason of (a)
        death; (b) Disability; (c) Normal Retirement or Early Retirement; (d) for Good Reason by the Participant; or (e) involuntary termination by the Company for any reason other than for Cause, all outstanding Awards of such Participant shall vest,
        become immediately exercisable and payable and have all restrictions lifted.  For purposes of an Award subject to Section 409A of the Code, Good Reason shall exist only if (i) the Participant notifies the Company of the event establishing Good
        Reason within 90 days of its initial existence, (ii) the Company is provided 30 days to cure such event and (iii) the Participant Separates from Service with the Company (or its successor) within 180 days of the initial occurrence of the event.

     

    12.2 Accelerated Vesting.  The Committee may (in accordance with
        Section 409A, to the extent applicable), in its discretion, provide in any Award Agreement, or, in the event of a Change in Control, may take such actions as it deems appropriate to provide, for the acceleration of the exercisability, vesting
        and/or settlement in connection with such Change in Control of each or any outstanding Award or portion thereof and Shares acquired pursuant thereto upon such conditions (if any), including termination of the Participant’s service prior to, upon,
        or following such Change in Control, to such extent as the Committee shall determine.  In the event of a Change of Control, and without the consent of any Participant, the Committee may, in its discretion, provide that for a period of at least
        fifteen (15) days prior to the Change in Control, any Options or Stock Appreciation Rights shall be exercisable as to all Shares subject thereto and that upon the occurrence of the Change in Control, such Stock Options or Stock Appreciation Rights
        shall terminate and be of no further force and effect.

     

    12.3 Assumption, Continuation or Substitution.  In the event of a
        Change in Control, the surviving, continuing, successor, or purchasing corporation or other business entity or parent thereof, as the case may be (the “Acquiror”), may (in accordance with Section 409A, to the extent applicable), without the consent
        of any Participant, either assume or continue the Company’s rights and obligations under each or any Award or portion thereof outstanding immediately prior to the Change in Control or substitute for each or any such outstanding Award or portion
        thereof a substantially equivalent award with respect to the Acquiror’s stock, as applicable; provided, that in the event of such an assumption, the Acquiror must grant the rights set forth in Section 12.1 to the Participant in respect of such assumed Awards.  For purposes of this Section, if so determined by the Committee, in its discretion, an Award denominated in Shares shall be deemed assumed if, following
        the Change in Control, the Award (as adjusted, if applicable, pursuant to Section 4.2 hereof) confers the right to receive, subject to the terms and conditions of the
        Plan and the applicable Award Agreement, for each Share subject to the Award immediately prior to the Change in Control, the consideration (whether stock, cash, other securities or property or a combination thereof) to which a holder of a share of
        Stock on the effective date of the Change in Control was entitled; provided, however, that if such consideration is not solely common stock of the Acquiror, the Committee may, with the consent of the Acquiror, provide for the consideration to be
        received upon the exercise or settlement of the Award, for each Share subject to the Award, to consist solely of common stock of the Acquiror equal in Fair Market Value to the per share consideration received by holders of Shares pursuant to the
        Change in Control.  Any Award or portion thereof which is neither assumed or continued by the Acquiror in connection with the Change in Control nor exercised or settled as of the time of consummation of the Change in Control shall terminate and
        cease to be outstanding effective as of the time of consummation of the Change in Control.

     

    
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    12.4 Cash-Out of Awards.  The Committee may (in accordance with
        Section 409A, to the extent applicable), in its discretion at or after grant and without the consent of any Participant, determine that, upon the occurrence of a Change in Control, each or any Award or a portion thereof outstanding immediately
        prior to the Change in Control and not previously exercised or settled shall be canceled in exchange for a payment with respect to each vested Share (and each unvested Share, if so determined by the Committee) subject to such canceled Award in (i)
        cash, (ii) stock of the Company or of a corporation or other business entity a party to the Change in Control, or (iii) other property which, in any such case, shall be in an amount having a Fair Market Value equal to the Fair Market Value of the
        consideration to be paid per Share in the Change in Control, reduced by the exercise or purchase price per share, if any, under such Award (which payment may, for the avoidance of doubt, be $0, in the event the per share exercise or purchase price
        of an Award is greater than the per share consideration in connection with the Change in Control).  In the event such determination is made by the Committee, the amount of such payment (reduced by applicable withholding taxes, if any), if any,
        shall be paid to Participants in respect of the vested portions of their canceled Awards as soon as practicable following the date of the Change in Control and may be paid in respect of the unvested portions of their canceled Awards in accordance
        with the vesting schedules applicable to such Awards.

     

    12.5 Performance Awards.  The Committee may (in accordance with
        Section 409A, to the extent applicable), in its discretion at or after grant, provide that in the event of a Change in Control, (i) any outstanding Performance Awards relating to performance periods ending prior to the Change in Control which have
        been earned but not paid shall become immediately payable, (ii) all then-in-progress performance periods for Performance Awards that are outstanding shall end, and either (A) any or all Participants shall be deemed to have earned an award equal to
        the relevant target award opportunity for the performance period in question, or (B) at the Committee’s discretion, the Committee shall determine the extent to which performance criteria have been met with respect to each such Performance Award, if
        at all, and (iii) the Company shall cause to be paid to each Participant such partial or full Performance Awards, in cash, Shares or other property as determined by the Committee, within thirty (30) days of such Change in Control, based on the
        Change in Control consideration, which amount may be zero if applicable.  In the absence of such a determination, any Performance Awards relating to performance periods that will not have ended as of the date of a Change in Control shall be
        terminated and canceled for no further consideration.

     

    
      
        	Section 13.	
                Amendment And Termination.

              

      

    

     

    13.1 Amendments to the Plan.  The Board may amend, alter, suspend,
        discontinue or terminate the Plan or any portion thereof at any time (and in accordance with Section 409A of the Code with regard to Awards subject thereto); provided that no such amendment, alteration, suspension, discontinuation or termination
        shall be made without stockholder approval if such approval is necessary to comply with any tax or regulatory requirement for which or with which the Board deems it necessary or desirable to comply.

     

    
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    13.2 Amendments to Awards.  Subject to the restrictions of Section 6.2, the Committee may waive any conditions or rights under, amend any terms of or alter, suspend, discontinue, cancel or terminate, any Award theretofore granted,
        prospectively or retroactively in time (and in accordance with Section 409A of the Code with regard to Awards subject thereto); provided that any such waiver, amendment, alteration, suspension, discontinuance, cancellation or termination that would
        materially and adversely affect the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that extent be effective without the consent of the affected Participant, holder or beneficiary.

     

    13.3 Adjustments of Awards Upon the Occurrence of Certain Unusual or
          Nonrecurring Events.  The Committee is hereby authorized to make equitable and proportionate adjustments in the terms and conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring events (and shall make
        such adjustments for the events described in Section 4.2 hereof) affecting the Company, any Subsidiary or Affiliate, or the financial statements of the Company or any
        Subsidiary or Affiliate, or of changes in applicable laws, regulations or accounting principles.

     

    
      
        	Section 14.	
                General Provisions.

              

      

    

     

    14.1 Limited Transferability of Awards.  Except as otherwise provided
        in the Plan, an Award Agreement or by the Committee at or after grant, no Award shall be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant, except by will or the laws of descent and distribution. 
        No transfer of an Award by will or by laws of descent and distribution shall be effective to bind the Company unless the Company shall have been furnished with written notice thereof and an authenticated copy of the will and/or such other evidence
        as the Committee may deem necessary or appropriate to establish the validity of the transfer.  No transfer of an Award for value shall be permitted under the Plan.

     

    14.2 Dividend Equivalents.  In the sole and complete discretion of the
        Committee, an Award may provide the Participant with dividends or dividend equivalents, payable in cash, Shares, other securities or other property on a deferred basis.  Dividends or dividend equivalents with respect to Performance Awards shall be
        accumulated until, and shall be paid only to the extent that, such Award is earned and vested based on the satisfaction of the applicable performance measures and time-based vesting restrictions. Dividends or dividend equivalents with respect to
        Awards that are subject to time-based vesting restrictions shall be accumulated until, and shall be paid only to the extent that, such Awards vest in accordance with their terms. All dividends or dividend equivalents may, at the Committee’s
        discretion, accrue interest or be invested into additional Shares.  Notwithstanding the foregoing, with respect to an Award subject to Section 409A of the Code, the payment, deferral or crediting of any dividends or dividend equivalents shall
        conform to the requirements of Section 409A of the Code.

     

    14.3 Minimum Vesting. All Awards shall be subject to a minimum
        time-based vesting or performance period, as applicable, of not less than one year from the grant date, except in the case of a Substitute Award made in replacement of an award that is already fully vested or scheduled to vest in less than one year
        from the grant date of such Substitute Award.  Notwithstanding the foregoing, up to 5% of the total shares authorized for issuance under the Plan pursuant to Section 4.1
        (as adjusted, if applicable, pursuant to Section 4.2) may provide for a vesting period or performance period of less than one year following the grant date.

     

    
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    14.4 Compliance with Section 409A of the Code.  No Award (or
        modification thereof) shall provide for deferral of compensation that does not comply with Section 409A of the Code unless the Committee, at the time of grant, specifically provides that the Award is not intended to comply with Section 409A of the
        Code.  Notwithstanding any provision of the Plan to the contrary, if one or more of the payments or benefits received or to be received by a Participant pursuant to an Award would cause the Participant to incur any additional tax or interest under
        Section 409A of the Code, the Committee may reform such provision to maintain to the maximum extent practicable the original intent of the applicable provision without violating the provisions of Section 409A of the Code.  In addition, if a
        Participant is a Specified Employee at the time of his or her Separation from Service, any payments with respect to any Award subject to Section 409A of the Code to which the Participant would otherwise be entitled by reason of such Separation from
        Service shall be made on the date that is six months after the Participant’s Separation from Service (or, if earlier, the date of the Participant’s death).  Although the Company intends to administer the Plan so that Awards will be exempt from, or
        will comply with, the requirements of Section 409A of the Code, the Company does not warrant that any Award under the Plan will qualify for favorable tax treatment under Section 409A of the Code or any other provision of federal, state, local or
        foreign law.  The Company shall not be liable to any Participant for any tax, interest, or penalties that Participant might owe as a result of the grant, holding, vesting, exercise, or payment of any Award under the Plan.

     

    14.5 No Rights to Awards.  No Person shall have any claim to be
        granted any Award, and there is no obligation for uniformity of treatment of Participants or holders or beneficiaries of Awards.  The terms and conditions of Awards need not be the same with respect to each Participant.

     

    14.6 Recoupment.  Notwithstanding anything in the Plan to the
        contrary, all Awards granted under the Plan and any payments made under the Plan shall be subject to clawback or recoupment as permitted or mandated by applicable law, rules, regulations or Company policy as enacted, adopted or modified from time
        to time. For the avoidance of doubt, this provision shall apply to any gains realized upon exercise or settlement of an Award.

     

    14.7 Share Certificates.  All certificates for Shares or other
        securities of the Company or any Subsidiary or Affiliate delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan
        or the rules, regulations and other requirements of the SEC or any state securities commission or regulatory authority, any stock exchange or other market upon which such Shares or other securities are then listed, and any applicable Federal or
        state laws, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.

     

    14.8 Tax Withholding.  A Participant may be required to pay to the
        Company or any Subsidiary or Affiliate and the Company or any Subsidiary or Affiliate shall have the right and is hereby authorized to withhold from any Award, from any payment due or transfer made under any Award or under the Plan, or from any
        compensation or other amount owing to a Participant the amount (in cash, Shares, other securities, other Awards or other property) of any applicable withholding or other tax-related obligations in respect of an Award, its exercise or any other
        transaction involving an Award, or any payment or transfer under an Award or under the Plan and to take such other action as may be necessary in the opinion of the Company to satisfy all obligations for the payment of such taxes.

     

    
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    The Committee may provide for additional cash payments to holders of Options to defray or offset any tax arising from the grant, vesting, exercise or payment
        of any Award.  Without limiting the generality of the foregoing, the Committee may in its discretion permit a Participant to satisfy or arrange to satisfy, in whole or in part, the tax obligations incident to an Award by: (a) electing to have the
        Company withhold Shares or other property otherwise deliverable to such Participant pursuant to the Award (provided, however, that the amount of any Shares so withheld shall not exceed the amount necessary to satisfy required federal, state local
        and foreign withholding obligations using the minimum statutory withholding rates for federal, state, local and/or foreign tax purposes, including payroll taxes, that are applicable to supplemental taxable income) and/or (b) tendering to the
        Company Shares owned by such Participant (or by such Participant and his or her spouse jointly) and purchased or held for the requisite period of time as may be required to avoid the Company’s or the Affiliates’ or Subsidiaries’ incurring an
        adverse accounting charge, based, in each case, on the Fair Market Value of the Shares on the payment date as determined by the Committee.  All such elections shall be irrevocable, made in writing, signed by the Participant, and shall be subject to
        any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.

    

    

    14.9 Award Agreements.  Each Award hereunder shall be evidenced by an
        Award Agreement that shall be delivered to the Participant and may specify the terms and conditions of the Award and any rules applicable thereto.  In the event of a conflict between the terms of the Plan and any Award Agreement, the terms of the
        Plan shall prevail.  The Committee shall, subject to applicable law, determine the date an Award is deemed to be granted.  The Committee or, except to the extent prohibited under applicable law, its delegate(s) may establish the terms of agreements
        or other documents evidencing Awards under the Plan and may, but need not, require as a condition to any such agreement’s or document’s effectiveness that such agreement or document be executed by the Participant, including by electronic signature
        or other electronic indication of acceptance, and that such Participant agree to such further terms and conditions as specified in such agreement or document.  The grant of an Award under the Plan shall not confer any rights upon the Participant
        holding such Award other than such terms, and subject to such conditions, as are specified in the Plan as being applicable to such type of Award (or to all Awards) or as are expressly set forth in the agreement or other document evidencing such
        Award.

     

    14.10 No Limit on Other Compensation Arrangements.  Nothing contained
        in the Plan shall prevent the Company or any Subsidiary or Affiliate from adopting or continuing in effect other compensation arrangements, which may, but need not, provide for the grant of Options, Restricted Shares, Restricted Share Units, Other
        Stock-Based Awards or other types of Awards provided for hereunder.

     

    
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    14.11 No Right to Employment.  The grant of an Award shall not be
        construed as giving a Participant the right to be retained in the employ of the Company or any Subsidiary or Affiliate.  Further, the Company or a Subsidiary or Affiliate may at any time dismiss a Participant from employment, free from any
        liability or any claim under the Plan, unless otherwise expressly provided in an Award Agreement.

     

    14.12 No Rights as Stockholder.  Subject to the provisions of the Plan
        and the applicable Award Agreement, no Participant or holder or beneficiary of any Award shall have any rights as a stockholder with respect to any Shares to be distributed under the Plan until such person has become a holder of such Shares.

     

    14.13 Governing Law.  The validity, construction and effect of the Plan
        and any rules and regulations relating to the Plan and any Award Agreement shall be determined in accordance with the laws of the State of Delaware without giving effect to conflicts of laws principles.

     

    14.14 Severability.  If any provision of the Plan or any Award is, or
        becomes, or is deemed to be invalid, illegal or unenforceable in any jurisdiction or as to any Person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed
        amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such
        jurisdiction, Person or Award and the remainder of the Plan and any such Award shall remain in full force and effect.

     

    14.15 Other Laws.  The Committee may refuse to issue or transfer any
        Shares or other consideration under an Award if, acting in its sole discretion, it determines that the issuance or transfer of such Shares or such other consideration might violate any applicable law or regulation (including applicable non-U.S.
        laws or regulations) or entitle the Company to recover the same under Exchange Act Section 16(b), and any payment tendered to the Company by a Participant, other holder or beneficiary in connection with the exercise of such Award shall be promptly
        refunded to the relevant Participant, holder or beneficiary.

     

    14.16 No Trust or Fund Created.  Neither the Plan nor any Award shall
        create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Subsidiary or Affiliate and a Participant or any other Person.  To the extent that any Person acquires a right to receive
        payments from the Company or any Subsidiary or Affiliate pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company or any Subsidiary or Affiliate.

     

    14.17 No Fractional Shares.  No fractional Shares shall be issued or
        delivered pursuant to the Plan or any Award, and the Committee shall determine whether cash, other securities or other property shall be paid or transferred in lieu of any fractional Shares or whether such fractional Shares or any rights thereto
        shall be canceled, terminated or otherwise eliminated.

     

    14.18 Headings.  Headings are given to the sections and subsections of
        the Plan solely as a convenience to facilitate reference.  Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof.

     

    
      20

      
        

    

    

    

    
      
        	Section 15.	
                Term Of The Plan.

              

      

    

     

    15.1 Effective Date.  The Plan shall be effective upon the later to
        occur of (i) its adoption by the Board or (ii) immediately prior to the Registration Date (the “Effective Date”).

     

    15.2 Expiration Date.  No new Awards shall be granted under the Plan
        after the tenth (10th) anniversary of the Effective Date.  Unless otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award granted hereunder may, and the authority of the Board or the Committee to amend, alter,
        adjust, suspend, discontinue or terminate any such Award or to waive any conditions or rights under any such Award shall, continue after the tenth (10th) anniversary of the Effective Date.

     

    

    

     

      

  

   

    

   

    

  21Note:
November 13, 2018

 

NEITHER
THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED WITH THE UNITED STATES SECURITIES
AND EXCHANGE COMMISSION IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT. 

 

THIS
NOTE DOES NOT REQUIRE PHYSICAL SURRENDER OF THE NOTE IN THE EVENT OF A PARTIAL REDEMPTION OR CONVERSION. AS A RESULT, FOLLOWING
ANY REDEMPTION OR CONVERSION OF ANY PORTION OF THIS NOTE, THE OUTSTANDING PRINCIPAL SUM REPRESENTED BY THIS NOTE MAY BE LESS THAN
THE PRINCIPAL SUM AND ACCRUED INTEREST SET FORTH BELOW.

 

 

10%
FIXED CONVERTIBLE PROMISSORY NOTE 

 

OF

 

SMOKE
CARTEL, INC.

 

 

Issuance
Date: November 13, 2018

Total
Face Value of Note: $610,000

Initial
Consideration: $160,000

 

This
Note is a duly authorized Fixed Convertible Promissory Note of Smoke Cartel, Inc. a corporation duly organized and existing
under the laws of the State of New York (the “Company”), designated
as the Company's 10% Fixed Convertible Promissory Note in the principal amount of $610,000 (the “Note”). This
Note will become effective only upon execution by both parties and delivery of the first payment of consideration by the Holder
(the “Effective Date”).

For
Value Received, the Company hereby promises to pay to the order of Tangiers Global, LLC or its registered assigns
or successors-in-interest (the “Holder”) the Principal Sum of $610,000 (the “Principal Sum”)
and to pay “guaranteed” interest on the principal balance hereof at an amount equivalent to 10% of the Principal Sum,
to the extent such Principal Sum and “guaranteed” interest and any other interest, fees, liquidated damages and/or
items due to Holder herein have not been repaid or converted into the Company's common stock (the “Common Stock”),
in accordance with the terms hereof. The sum of $160,000 (the “Initial Consideration”) shall be remitted and
delivered to the Company. The Company covenants that within  months of the Effective Date of the Note, it shall utilize
approximately $160,000 of the proceeds in the manner set forth on Schedule 1, attached hereto (the “Use of Proceeds”),
and shall promptly provide evidence thereof to Holder, in sufficient detail as reasonably requested by Holder.

    	 	1	 

     

    

The Holder may pay
additional consideration (each, a “Consideration”) to the Company in such amounts and at such dates (each, an
“Additional Consideration Date”) as Holder may choose in its sole discretion. The Principal Sum due to Holder
shall be prorated based on the Consideration actually paid by Holder (plus the “guaranteed” interest, which shall be
prorated based on the Consideration actually paid by the Holder, as well as any other interest or fees) such that the Company is
only required to repay the amount funded and the Company is not required to repay any unfunded portion of this Note. The Maturity
Date is seven months from the Effective Date of each payment (the “Maturity Date”)
and is the date upon which the Principal Amount of this Note, as well as any unpaid interest and other fees, shall be due and payable.
Any amount repaid by the Company to the Holder, whether through cash or converted into the Company"s Common Stock, in any
case in accordance with the terms hereof. shall immediately be deducted from the Principal Amount of the Note, and the Principal
Amount of the Note shall be reduced 10 reflect each applicable payment.

In addition to the
“guaranteed” interest referenced above, and in the Event of Default pursuant to Section 2.00(a), additional interest
will accrue from the date of the Event of Default at the rate equal to the lower of 15% per annum or the highest rate permitted
by law (the “Default Rate”).

This Note will become
effective only upon the execution by both parties, including the execution of Exhibits B, C, D, E, Schedule 1, and the Irrevocable
Transfer Agent Instructions (the “Date of Execution”) and delivery of the initial payment of consideration by
the Holder (the “Effective Date”).

As an investment incentive,
the Company shall issue to the Holder 27,500 shares of its Common Stock (the “Initial Origination Shares”),
which shares shall be issued and delivered to the Holder within 3 Trading Days of the Date of Execution. Furthermore, the Company
agrees it shall issue an additional 27,500 shares of its Common Stock (each, an “Additional Origination Share Tranche”,
and, together with the Initial Origination Shares, the “Origination Shares”) for each Consideration paid to
the Company by the Holder under the Note, and that each Additional Origination Share Tranche shall be issued and delivered to the
Holder within 3 Trading Days of each Additional Consideration Date. The Company and the Holder acknowledge and agree that if the
entirety of the Note is funded, the Company shall have issued to the Holder 110,000 shares of its Common Stock, which is the maximum
number of shares the Company shall be required to issue and deliver to the Holder.

This Note may be prepaid
by the Company, in whole or in part, according to the following schedule:

	Days Since Effective Date	Prepayment Amount
	Under 180	125% of Principal Amount

 

After 180 days from
the Effective Date this Note may not be prepaid without written consent from Holder, which consent may be withheld, delayed or
denied in Holder’s sole and absolute discretion. Whenever any amount expressed to be due by the terms of this Note is due
on any day which is not a Business Day (as defined below), the same shall instead be due on the next succeeding day which is a
Business Day. If the Note is in default, per Section 2.00(a) below, the Company may not prepay the Note without written consent
of the Holder.

    	 	2	 

     

    

For purposes hereof
the following terms shall have the meanings ascribed to them below:

“Business
Day” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the City of New York
are authorized or required by law or executive order to remain closed.

“Conversion
Price” shall be fixed at a price equal to $1.40 per share.

“Principal
Amount” shall refer to the sum of (i) the original principal amount of this Note, (ii) all guaranteed and other
accrued but unpaid interest hereunder, (iii) any fees due hereunder, (iv) liquidated damages, and (v) any default payments owing
under the Note, in each case previously paid or added to the Principal Amount.

“Principal Market”
shall refer to the primary exchange on which the Company’s common stock is traded or quoted.

“Trading
Day” shall mean a day on which there is trading or quoting for any security on the Principal Market.

“Underlying
Shares” means the shares of common stock into which the Note is convertible (including interest, fees, liquidated
damages and/or principal payments in common stock as set forth herein) in accordance with the terms hereof.

The following terms
and conditions shall apply to this Note:

Section 1.00Conversion.

(a)  
Conversion Right. Subject to the terms hereof and restrictions and limitations contained herein, the Holder shall
have the right, at the Holder's sole option, at any time and from time to time to convert in whole or in part the outstanding and
unpaid Principal Amount under this Note into shares of Common Stock as per the Conversion Price, but not to exceed the Restricted
Ownership Percentage, as defined in Section 1.00(f). The date of any conversion notice (“Conversion Notice”)
hereunder shall be referred to herein as the “Conversion Date”. The Conversion Price shall be equitably adjusted
in the event of a forward split, stock dividend, or the like, but shall not be adjusted in the event of a reverse split, recombination,
or the like.

(b)       Stock
Certificates or DWAC. The Company will deliver to the Holder, or Holder’s authorized designee, no later than 2 Trading
Days after the Conversion Date, a certificate or certificates (which certificate(s) shall be free of restrictive legends and trading
restrictions if the shares of Common Stock underlying the portion of the Note being converted are eligible under a resale exemption
pursuant to Rule 144(b)(1)(ii) and Rule 144(d)(1)(ii) of the Securities Act of 1933, as amended) representing the number of shares
of Common Stock being acquired upon the conversion of this Note. In lieu of delivering physical certificates representing the
shares of Common Stock issuable upon conversion of this Note, provided the Company's

    	 	3	 

     

    

 transfer agent
is participating in Depository Trust Company’s (“DTC”) Fast Automated Securities Transfer (“FAST”)
program, the Company shall instead use commercially reasonable efforts to cause its transfer agent to electronically transmit
such shares issuable upon conversion to the Holder (or its designee), by crediting the account of the Holder’s (or such
designee’s) broker with DTC through its Deposits and Withdrawal at Custodian (“DWAC”) program (provided
that the same time periods herein as for stock certificates shall apply). If the Origination Shares, whether in whole or in part,
are registered under an active and usable registration statement or are eligible under a resale exemption pursuant to Rule 144(b)(1)(ii)
and Rule 144(d)(1)(ii) of the Securities Act of 1933, as amended, then, in regards to the Origination Shares, the Company shall
be required to comply with the terms and conditions of this Section 1.00.

(c) Charges and Expenses.
Issuance of Common Stock to Holder, or any of its assignees, upon the conversion of this Note shall be made without charge to the
Holder for any issuance fee, transfer tax, legal opinion and related charges, postage/mailing charge or any other expense with
respect to the issuance of such Common Stock. Company shall pay all Transfer Agent fees incurred from the issuance of the Common
Stock to Holder, as well as any and all other fees and charges required by the Transfer Agent as a condition to effectuate such
issuance. Any such fees or charges, as noted in this Section that are paid by the Holder (whether from the Company’s delays,
outright refusal to pay, or otherwise), will be automatically added to the Principal Sum of the Note and tack back to the Effective
Date for purposes of Rule 144.

(d)       Delivery
Timeline. If the Company fails to deliver to the Holder such certificate or certificates (or shares through the DWAC program)
pursuant to this Section (free of any restrictions on transfer or legends, if eligible) prior to 3 Trading Days after the Conversion
Date, the Company shall pay to the Holder as liquidated damages an amount equal to $2,000 per day, until such certificate or certificates
are delivered. The Company acknowledges that it would be extremely difficult or impracticable to determine the Holder’s actual
damages and costs resulting from a failure to deliver the Common Stock and the inclusion herein of any such additional amounts
are the agreed upon liquidated damages representing a reasonable estimate of those damages and costs. Such liquidated damages will
be automatically added to the Principal Sum of the Note and tack back to the Effective Date for purposes of Rule 144.

(e)       Reservation
of Underlying Securities. The Company covenants that it will at all times reserve and keep available for Holder, out of its
authorized and unissued Common Stock solely for the purpose of issuance upon conversion of this Note, free from preemptive rights
or any other actual contingent purchase rights of persons other than the Holder, five times the number of shares of Common
Stock as shall be issuable (taking into account the adjustments under this Section 1.00, but without regard to any ownership limitations
contained herein) upon the conversion of this Note (consisting of the Principal Amount), under the formula in Section Section
2.00(c) below, to Common Stock (the “Required Reserve”). The Company covenants that all shares of Common Stock
that shall be issuable will, upon issue, be duly authorized, validly issued, fully-paid, non-assessable and freely-tradable (if
eligible). If the amount of shares on reserve in Holder’s name at the Company’s transfer agent for this Note shall
drop below the Required Reserve, the Company will, within 2 Trading Days of notification from Holder, instruct the transfer agent
to increase the number of shares so that the Required Reserve is met. In the event that the Company does not instruct the transfer
agent to increase the number of shares so that the Required Reserve is met, the Holder will be allowed, if applicable, to provide
this instruction as per the terms of the Irrevocable Transfer Agent Instructions attached to this Note. The Company agrees that
the maintenance of the Required Reserve is a material term of this Note and any breach of this Section 1.00(e) will result in
a default of the Note.

    	 	4	 

     

    

(f)       Conversion
Limitation. The Holder will not submit a conversion to the Company that would result in the Holder beneficially owning more
than 9.99% of the then total outstanding shares of the Company (“Restricted Ownership
Percentage”).

(g)       Conversion
Delays. If the Company fails to deliver shares in accordance with the timeframe stated in Section 1.00(b), the Holder, at any
time prior to selling all of those shares, may rescind any portion, in whole or in part, of that particular conversion attributable
to the unsold shares. The rescinded conversion amount will be returned to the Principal Sum with the rescinded conversion shares
returned to the Company, under the expectation that any returned conversion amounts will tack back to the Effective Date.

(h)       Shorting
and Hedging. Holder may not engage in any “shorting” or “hedging” transaction(s) in the Common Stock
of the Company prior to conversion.

(i)       Conversion
Right Unconditional. If the Holder shall provide a Conversion Notice as provided herein, the Company's obligations to deliver
Common Stock shall be absolute and unconditional, irrespective of any claim of setoff, counterclaim, recoupment, or alleged breach
by the Holder of any obligation to the Company.

Section 2.00Defaults
and Remedies.

(a)       Events
of Default. An “Event of Default” is: (i) a default in payment of any amount due hereunder which default
continues for more than 5 Trading Days after the due date; (ii) a default in the timely issuance of underlying shares upon and
in accordance with terms of Section 1.00, which default continues for 2 Trading Days after the Company has failed to issue shares
or deliver stock certificates within the 3rd Trading Day following the Conversion Date; (iii) if the Company does not issue the
press release or file the Supplemental Information statement, in each case in accordance with the provisions and the deadlines
referenced Section 4.00(i); (iv) failure by the Company for 3 days after notice has been received by the Company to comply with
any material provision of this Note; (v) failure of the Company to remain compliant with DTC, thus incurring a “chilled”
status with DTC; (vi) any default of any mortgage, indenture or instrument which may be issued, or by which there may be secured
or evidenced any indebtedness, for money borrowed by the Company or for money borrowed the repayment of which is guaranteed by
the Company, whether such indebtedness or guarantee now exists or shall be created hereafter, in any case, which exceeds $75,000;
(vii) if the Company is subject to any Bankruptcy Event; (viii) any failure of the Company to satisfy its “filing”
obligations under Securities Exchange Act of 1934, as amended (the “1934 Act”) and the rules and guidelines
issued by OTC Markets News Service, OTCMarkets.com and their affiliates; (ix) failure of the Company to remain in good standing
under the laws of its state of domicile; (x) any failure of the Company to provide the Holder with information related to its
corporate structure including, but not limited to, the number of authorized and outstanding shares, public float, etc. within
3 Trading Days of request by Holder; (xi) failure by the Company to maintain the Required Reserve in accordance with the terms
of Section 1.00(e); (xii) failure of Company’s Common Stock to maintain a closing bid price in its Principal Market for
more than 3 consecutive Trading Days; (xiii) any delisting from a Principal Market for any reason; (xiv) failure by Company to
pay any of its Transfer Agent fees in excess of $2,000 or to maintain a Transfer Agent of record; 

    	 	5	 

     

    

(xv) failure by Company to notify Holder of a change
in Transfer Agent within 24 hours of such change; (xvi) any trading suspension imposed by the United States Securities and
Exchange Commission (the “SEC”) under Sections 12(j) or 12(k) of the 1934 Act; (xvii) failure by the Company
to meet all 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, requirements for XBRL
filings, and requirements for disclosure of financial statements on its website; (xviii) failure
of the Company to abide by the Use of Proceeds or failure of the Company to inform the Holder of a change in the Use of Proceeds;
or (xix) failure of the Company to abide by the terms of the right of first refusal contained in Section 4.00(k).

(b)            
Remedies. If an Event of Default occurs, the Holder shall provide the Company with written notice of said Event of
Default and the Company shall have seven (7) days to cure said Event of Default (each a “Default Cure Period”),
provided, however, that the Holder need not provide said written notice, nor shall the Company be allowed a Default Cure Period,
for an Event of Default described in Section 2.00(a)(i) or Section 2.00(a)(ii). Such notice shall be governed by the terms of Section
4.00(f)(v). Should the Company not cure the applicable Event of Default within its respective Default Cure Period, the outstanding
Principal Amount of this Note owing in respect thereof through the date of acceleration, shall become, at the Holder's election,
immediately due and payable at the “Mandatory Default Amount”. The Mandatory Default Amount means 25% of the
outstanding Principal Amount of this Note, will be automatically added to the Principal Sum of the Note and tack back to the Effective
Date for purposes of Rule 144. Commencing 5 days after the occurrence of any Event of Default and its respective Default Cure Period,
if applicable, that results in the eventual acceleration of this Note, this Note shall accrue additional interest, in addition
to the Note’s “guaranteed” interest, at a rate equal to the lesser of 15% per annum or the maximum rate permitted
under applicable law. In connection with such acceleration described herein, and other than as expressly set forth herein, the
Holder need not provide, and the Issuer hereby waives, any presentment, demand, protest or other notice of any kind, and the Holder
may immediately and without expiration of any grace period enforce any and all of its rights and remedies hereunder and all other
remedies available to it under applicable law. Such acceleration may be rescinded and annulled by the Holder at any time prior
to payment hereunder and the Holder shall have all rights as a holder of the note until such time, if any, as the Holder receives
full payment pursuant to this Section 2.00. No such rescission or annulment shall affect any subsequent event of default or impair
any right consequent thereon. Nothing herein shall limit the Holder's right to pursue any other remedies available to it at law
or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Issuer's
failure to timely deliver certificates representing shares of Common Stock upon conversion of the Note as required pursuant to
the terms hereof.

(c)Conversion Right. At any time
and from time to time, at least 120 days from the Effective Date, after an Event of Default described in Section 2.00(a) has occurred,
and subject to the terms contained in Section 2.00(b), the Holder shall have the right, at the Holder's sole option, to convert
in whole or in part the outstanding and unpaid Principal Amount under this Note into shares of Common Stock at the Default Conversion
Price. The “Default Conversion Price” shall be equal to the lower of: (a) the Conversion Price
or (b) 65% of the lowest trading price of the Company’s common stock during the 15 consecutive Trading Days prior to the
date on which Holder elects to convert all or part of the Note. For the purpose of calculating the Default Conversion Price only,
any time after 4:00 pm Eastern Time (the closing time of the Principal Market) shall be considered to be the beginning of the next
Business Day. If the Company is placed on “chilled” status with the DTC, the discount shall be increased by 10%, i.e.,
from 35% to 45%, until such chill is remedied. If the Company is not DWAC eligible through their Transfer Agent and DTC’s
FAST system, the discount will be increased by 5%, i.e., from 35% to 40%. In the case of both, the discount shall
be a cumulative increase of 15%, i.e., from 35% to 50%.

 

    	 	6	 

     

    

 

Section 3.00 Representations and Warranties of Holder.

 

Holder hereby represents and warrants to the
Company that:

 

(a)Holder is an “accredited investor,”
as such term is defined in Regulation D of the Securities Act of 1933, as amended (the “1933 Act”), and will
acquire this Note and the Underlying Shares (collectively, the “Securities”) for its own account and not with
a view to a sale or distribution thereof as that term is used in Section 2(a)(11) of the 1933 Act, in a manner which would require
registration under the 1933 Act or any state securities laws. Holder has such knowledge and experience in financial and business
matters that such Holder is capable of evaluating the merits and risks of the Securities. Holder can bear the economic risk of
the Securities, has knowledge and experience in financial business matters and is capable of bearing and managing the risk of investment
in the Securities. Holder recognizes that the Securities have not been registered under the 1933 Act, nor under the securities
laws of any state and, therefore, cannot be resold unless the resale of the Securities is registered under the 1933 Act or unless
an exemption from registration is available. Holder has carefully considered and has, to the extent Holder believes such discussion
necessary, discussed with its professional, legal, tax and financial advisors, the suitability of an investment in the Securities
for its particular tax and financial situation and its advisers, if such advisors were deemed necessary, and has determined that
the Securities are a suitable investment for it. Holder has not been offered the Securities by any form of general solicitation
or advertising, including, but not limited to, advertisements, articles, notices or other communications published in any newspaper,
magazine, or other similar media or television or radio broadcast or any seminar or meeting where, to Holders’ knowledge,
those individuals that have attended have been invited by any such or similar means of general solicitation or advertising. Holder
has had an opportunity to ask questions of and receive satisfactory answers from the Company, or any person or persons acting on
behalf of the Company, concerning the terms and conditions of the Securities and the Company, and all such questions have been
answered to the full satisfaction of Holder. The Company has not supplied Holder any information regarding the Securities or an
investment in the Securities other than as contained in this Agreement, and Holder is relying on its own investigation and evaluation
of the Company and the Securities and not on any other information.

 

(b)The Holder is a limited liability
company duly organized, validly existing and in good standing under the laws of the state of its incorporation and has all requisite
corporate power and authority to carry on its business as now conducted. The Holder is duly qualified to transact business and
is in good standing in each jurisdiction in which the failure to so qualify would have a material adverse effect on its business
or properties.

 

(c)All limited liability company action
has been taken on the part of the Holder, its officers, directors, managers and members necessary for the authorization, execution
and delivery of this Note. The Holder has taken all limited liability company action required to make all of the obligations of
the Holder reflected in the provisions of this Note, valid and enforceable obligations.

 

    	 	7	 

     

    

 

(d)Each certificate or instrument representing
Securities will be endorsed with the following legend (or a substantially similar legend), unless or until registered under the
1933 Act or exempt from registration:

 

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS
THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE TRANSFER IS MADE IN COMPLIANCE WITH RULE
144 PROMULGATED UNDER SUCH ACT OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES WHICH IS REASONABLY
SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND
PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.

 

Section 4.00General.

(a)        Payment
of Expenses. The Company agrees to pay all reasonable charges and expenses, including attorneys' fees and expenses, which may
be incurred by the Holder in successfully enforcing this Note and/or collecting any amount due under this Note.

(b)        Assignment,
Etc. The Holder may assign or transfer this Note to any “accredited investor”, as such term is defined in Regulation
D of the 1933 Act, at its sole discretion. Note shall be binding upon the Company and its successors and shall inure to the benefit
of the Holder and its successors and permitted assigns.

(c)       Amendments.
This Note may not be modified or amended, or any of the provisions of this Note waived, except by written agreement of the Company
and the Holder.

(d)       Funding
Window. The Company agrees that it will not enter into a convertible debt financing transaction, including 3(a)9 and 3(a)10
transactions, with any party other than the Holder for a period of 45 Trading Days following the Effective Date and each Additional
Consideration Date, as relevant. The Company agrees that this is a material term of this Note and any breach of this Section 4.00(d)
will result in a default of the Note.

(e)       Terms
of Future Financings. So long as this Note is outstanding, upon any issuance by the Company or any of its subsidiaries of any
convertible debt security (whether such debt begins with a convertible feature or such feature is added at a later date) with any
term more favorable to the holder of such security or with a term in favor of the holder of such security that was not similarly
provided to the Holder in this Note, then the Company shall notify the Holder of such additional or more favorable term and such
term, at the Holder's option, shall become a part of this Note and its supporting documentation.. The types of terms contained
in the other security that may be more favorable to the holder of such security include, but are not limited to, terms addressing
conversion discounts, conversion look back periods, interest rates, original issue discount percentages and warrant coverage.

(f)       Governing
Law; Jurisdiction.

(i)             
Governing Law. This Note will be governed by, and construed and interpreted
in accordance with, the laws of the State of Florida without regard to any conflicts of laws or provisions thereof that would
otherwise require the application of the law of any other jurisdiction.

    	 	8	 

     

    

(ii)       Jurisdiction
and Venue. Any dispute, claim, suit, action or other legal proceeding arising out of or relating to this Note or the
rights and obligations of each of the parties shall be brought only in Miami-Dade County, Florida or in the federal courts of the
United States of America located in Miami-Dade, Florida.

(iii)       No
Jury Trial. The Company hereto knowingly and voluntarily waives any and all rights it may have to a trial by jury with respect
to any litigation based on, or arising out of, under, or in connection with, this Note.

(iv)       Delivery
of Process by the Holder to the Company. In the event of an action or proceeding by the Holder against the Company, and only
by the Holder against the Company, service of copies of summons and/or complaint and/or any other process that may be served in
any such action or proceeding may be made by the Holder via U.S. Mail, overnight delivery service such as FedEx or UPS, email,
fax, or process server, or by mailing or otherwise delivering a copy of such process to the Company at its last known attorney
as set forth in its most recent SEC filing.

(v)       Notices.
Any notice required or permitted hereunder (including Conversion Notices) must be in writing and either personally served, sent
by facsimile or email transmission, or sent by overnight courier. Notices will be deemed effectively delivered at the time of transmission
if by facsimile or email, and if by overnight courier the business day after such notice is deposited with the courier service
for delivery.

(g)       No
Bad Actor. No officer or director of the Company would be disqualified under Rule 506(d) of the Securities Act of 1933, as
amended, on the basis of being a “bad actor” as that term is established in the September 13, 2013 Small Entity Compliance
Guide published by the SEC.

(h)       Usury.
If it shall be found that any interest or other amount deemed interest due hereunder violates any applicable law governing usury,
the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under
applicable law. The Company covenants (to the extent that it may lawfully do so) that it will not seek to claim or take advantage
of any law that would prohibit or forgive the Company from paying all or a portion of the principal, fees, liquidated damages or
interest on this Note.

(i)       Securities
Laws Disclosure; Publicity. The Company shall (a) by 9:30 a.m. Eastern Time on the Trading Day immediately following the Date
of Execution, issue a press release disclosing the material terms of the transactions contemplated hereby, and (b) file a Supplemental
Information statement with OTCMarkets within 4 Trading Days following the Date of Execution. From and after the filing of such
press release, the Company represents to the Holder that it shall have publicly disclosed all material, non-public information
delivered to the Holder by the Company, or any of its officers, directors, employees, or agents in connection

    	 	9	 

     

    

with the transactions
contemplated by this Note. The Company and the Holder shall consult with each other in issuing any other press releases with respect
to the transactions contemplated hereby, and neither the Company nor the Holder shall issue any such press release nor otherwise
make any such public statement without the prior consent of the Company, with respect to any press release of the Holder, or without
the prior consent of the Holder, with respect to any press release of the Company, none of which consents shall be unreasonably
withheld, delayed, denied, or conditioned except if such disclosure is required by law, in which case the disclosing party shall
promptly provide the other party with prior notice of such public statement or communication. Notwithstanding the foregoing, the
Company shall not publicly disclose the name of the Holder, or include the name of the Holder in any filing with the SEC or any
regulatory agency or Principal Market, without the prior written consent of the Holder, except to the extent such disclosure is
required by law or Principal Market regulations, in which case the Company shall provide the Holder with prior notice of such disclosure
permitted hereunder.

The Company agrees that this is a material
term of this Note and any breach of this Section 4.00(i) will result in a default of the Note.

(j)       Attempted
Below-par Issuance. In the event that (i) any requested conversion hereunder shall be at a Conversion Price that is less than
then-current par value of the Company’s Common Stock and that any or all of such requested conversion would be precluded
by state law or otherwise and (ii) within three business days of the requested conversion, the Company shall not have reduced
its par value such that all of the requested conversion may then be accomplished, then the Company and the Holder agree to the
following conversion protocol: the Holder shall generate and transmit to the Company (X) a “preliminary” Conversion
Notice for the full number of shares of Common Stock of the above-referenced conversion at the Conversion Price without regard
to any below-par value conversion issues; (Y) a “par value” Conversion Notice for the number of shares of Common Stock
for the above-referenced conversion with the Conversion Price increased from the Conversion Price set forth in the “preliminary”
Conversion Notice to a Conversion Price at par value; and (Z) a “liquidated damages” Conversion Notice for that number
of shares of Common Stock that represents the difference between the number of shares of Common Stock in the “preliminary”
Conversion Notice and the number of shares of Common Stock in the “par value” Conversion Notice and the Conversion
Price of such “liquidated damages Common Shares” would be the par value of the Common Stock. The Company acknowledges
that any failure by it to provide the Holder with its full conversion rights under this Note (as a result of a proposed “below
par” conversion) will cause the Holder to incur substantial economic damages and losses of types and in amounts that are
impossible to compute and ascertain with certainty as a basis for recovery by the Holder of actual damages and that liquidated
damages would represent a fair, reasonable, and appropriate estimate thereof. Accordingly, in the event that the Holder is precluded
from exercising any or all of its conversion rights hereunder as a result of a proposed “below par” conversion, the
Company agrees that, in lieu of actual damages for such failure, liquidated damages may be assessed and recovered by the Holder
without being required to present any evidence of the amount or character of actual damages sustained by reason thereof. The amount
of such liquidated damages shall be an amount equivalent to the trading price (without discount) utilized in the “preliminary”
Conversion Notice multiplied by the number of shares calculated on the “liquidated damages” Conversion Notice. Such
amount shall be assessed and become immediately due and payable to the Holder (at its election) in the form of a cash payment,
an addition to the Principal Sum of this Note, or the immediate issuance of that number of shares of Common Stock as calculated
on the “liquidated damages” Conversion Notice. Such liquidated damages are intended to represent estimated actual
damages and are not intended to be a penalty, but, by virtue of their genesis and subject to the election of the Holder (as set
forth in the immediately preceding sentence), will be automatically added to the Principal Sum of the Note and tack back to the
Effective Date for purposes of Rule 144. For the avoidance of doubt, these “liquidated damages” will be the sole and
unique remedy to this Section 4.00(j) and shall not constitute an Event of Default.

    	 	10	 

     

    

(k)       Right
of First Refusal. From and after the date of this Note and at all times hereafter while the Note is outstanding, the Parties
agree that, in the event that the Company receives any written or oral proposal (the “Proposal”) containing
one or more offers to provide additional capital or equity or debt financing (the “Financing Amount”), the Company
agrees that it shall provide a copy of all documents received relating to the Proposal together with a complete and accurate description
of the Proposal to the Holder and all amendments, revisions, and supplements thereto (the “Proposal Documents”)
no later than 3 business days from the receipt of the Proposal Documents. Following receipt of the Proposal Documents from the
Company, the Holder shall have the right (the “Right of First Refusal”), but not the obligation, for a period
of 5 business days thereafter (the “Exercise Period”), to invest, at similar or better terms to the Company,
an amount equal to or greater than the Financing Amount, upon written notice to the Company that the Holder is exercising the Right
of First Refusal provided hereby. In furtherance of the Right of First Refusal, the Company agrees that it will cooperate and assist
the Holder in conducting a due diligence investigation of the Company and its corporate and financial affairs and promptly provide
the Holder with information and documents that the Holder may reasonably request so as to allow the Holder to make an informed
investment decision. However, the Company and the Holder agree that the Holder shall have no more than 5 business days from and
after the expiration of the Exercise Period to exercise its Right of First Refusal hereunder. This Right of First Refusal shall
extend to all purchases of debt held by, or assigned to or from, current stockholders, vendors, or creditors, all transactions
under Sections 3(a)9 and/or 3(a)10 or the Securities Act of 1933, as amended, and all equity line-of-credit transactions. In the
event that the Company does enter into, or makes any issuance of Common Stock related to a 3(a)(9) Transaction or a 3(a)(10) Transaction
while this note is outstanding, without giving Right of First Refusal to the Holder, a liquidated damages charge of 25% of the
outstanding principal balance of this Note, but not less than $25,000, will be assessed and will become immediately due and payable
to the Holder at its election in the form of cash payment or addition to the balance of this Note. Such liquidated damages will
be automatically added to the Principal Sum of the Note and tack back to the Effective Date for purposes of Rule 144.

 

 

[Signature Page to Follow.]

    	 	11	 

     

    

 

IN WITNESS WHEREOF,
the Company has caused this Fixed Convertible Promissory Note to be duly executed on the day and in the year first above written.

 

 

SMOKE CARTEL, INC.

 

 

By: /s/ Darby Cox

 

Name: Darby Cox

 

Title: CEO

 

Email: darby@smokecartel.com

 

Address: 1313 Rogers Street

Savannah, GA 31415

 

This Fixed Convertible Promissory Note of November 13, 2018 is accepted
this 13th day of November, 2018 by

 

TANGIERS GLOBAL, LLC

By:/s/ Michael Sobeck

Name: Michael Sobeck

Title: Managing Member

 

    	 	12	 

     

    

 

EXHIBIT A

 

FORM OF CONVERSION NOTICE

 

(To
be executed by the Holder in order to convert all or part of that certain $610,000 Fixed Convertible Promissory Note identified
as the Note)

 

DATE:____________________________

FROM:Tangiers
Global, LLC (the “Holder”)

 

		Re:	$610,000 Fixed Convertible Promissory Note (this “Note”) originally issued by
Smoke Cartel, Inc., a New York corporation, to Tangiers Global, LLC on November 13, 2018.

 

The
undersigned on behalf of Tangiers Global, LLC, hereby elects to convert $_______________________ of the aggregate
outstanding Principal Amount (as defined in the Note) indicated below of this Note into shares of Common Stock, $0.0001 par value
per share, of Smoke Cartel, Inc. (the “Company”), according to
the conditions hereof, as of the date written below. If shares are to be issued in the name of a person other than undersigned,
the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions
as reasonably requested by the Company in accordance therewith. No fee will be charged to the holder for any conversion, except
for such transfer taxes, if any. The undersigned represents as of the date hereof that, after giving effect to the conversion of
this Note pursuant to this Conversion Notice, the undersigned will not exceed the “Restricted Ownership Percentage”
contained in this Note.

Conversion
information:

 ______________________________________________

Date
to Effect Conversion

 

 ______________________________________________

Aggregate
Principal Sum of Note Being Converted

 

 ______________________________________________

Aggregate
Interest/Fees of Principal Amount Being Converted

 

 ______________________________________________

Remaining
Principal Balance

 

 ______________________________________________

Number
of Shares of Common Stock to be Issued

 

 ______________________________________________

Applicable
Conversion Price

 

 ______________________________________________

Signature

 

 ______________________________________________

Name

 

 ______________________________________________

Address

 

    	 	13	 

     

    

 

 

EXHIBIT B

 

WRITTEN CONSENT OF THE BOARD OF DIRECTORS
OF

 

SMOKE CARTEL, INC.

 

 

The undersigned, being directors of Smoke Cartel, Inc., a New York
corporation (the “Company”), acting pursuant to the Bylaws of the Corporation, do hereby consent to, approve and adopt
the following preamble and resolutions:

 

Convertible Note with Tangiers Global, LLC

 

The board of directors of the Company has reviewed and authorized
the following documents relating to the issuance of a Fixed Convertible Promissory Note in the amount of $610,000 with Tangiers
Global, LLC.

 

The documents agreed to and dated November 13, 2018 are as follows:

 

10% Fixed Convertible Promissory Note of Smoke Cartel, Inc.

Irrevocable Transfer Agent Instructions

Certificate of Corporate Secretary

Disbursement Instructions

Schedule 1 – Use of Proceeds

 

The board of directors further agree to authorize and approve the
issuance of shares to the Holder at Conversion prices that are below the Company’s then current par value.

 

IN WITNESS WHEREOF, the undersign member(s) of the board of the
Company executed this unanimous written consent as of November 13, 2018.

 

 

/s/ Charles J. Bowen______________________

 

By: Charles J. Bowen

 

Its: Member, Board of Directors

 

 

/s./ Darby Cox__________________________

 

By: Darby Cox

 

Its: Member, Board of Directors

 

 

/s/ Sean Geng___________________________

 

By: Sean Geng

 

Its: President

 

    	 	14	 

     

    

 

EXHIBIT C

 

CERTIFICATE OF CORPORATE SECRETARY OF

 

SMOKE CARTEL, INC.

 

(Two Pages)

 

 

The undersigned, Andrea Alexander
is the duly elected Corporate Secretary of Smoke Cartel, Inc., a New York corporation (the “Company”).

 

I hereby warrant and represent
that I have undertaken a complete and thorough review of the Company’s corporate and financial books and records, including,
but not limited to, the Company’s records relating to the following:

 

		(A)	The issuance of that certain convertible promissory note dated November 13, 2018 (the “Note
Issuance Date”) issued to Tangiers Global, LLC (the “Holder”) in the stated original principal amount
of $610,000 (the “Note”);

 

		(B)	The Company’s Board of Directors duly approved the issuance of the Note to the Holder;

 

		(C)	The Company has not received and does not contemplate receiving any new consideration from any
persons in connection with any later conversion of the Note and the issuance of the Company’s Common Stock upon any said
conversion;

 

		(D)	To my best knowledge and after completing the aforementioned review of the Company’s stockholder
and corporate records, I am able to certify that the Holder (and the persons affiliated with the Holder) are not officers, directors,
or directly or indirectly, ten percent (10.00%) or more stockholders of the Company and none of said persons has had any such status
in the one hundred (100) days immediately preceding the date of this Certificate;

 

		(E)	The Company’s Board of Directors have approved duly adopted resolutions approving the Irrevocable
Instructions to the Company’s Stock Transfer Agent dated November 13, 2018;

 

		(F)	Mark the appropriate selection:

 

__✓_ The Company represents
that it is not a “shell company,” as that term is defined in Section 12b-2 of the Securities Exchange Act of 1934,
as amended, and has never been a shell company, as so defined; or

 

___ The Company represents that (i)
it was a “shell company,” as that term is defined in Section 12b-2 of the Securities Exchange Act of 1934, as amended,
(ii) since ______, 201__, it has no longer been a shell company, as so defined, and (iii) on _______, 201__, it provided Form
10-type information in a filing with the United States Securities and Exchange Commission.

 

    	 	15	 

     

    

 

		(G)	I understand the constraints imposed under Rule 144 on those persons who are or may be deemed to
be “affiliates,” as that term is defined in Rule 144(a)(1) of the Securities Act of 1933, as amended.

 

		(H)	I understand that all of the representations set forth in this Certificate will be relied upon
by counsel to Tangiers Global, LLC in connection with the preparation of a legal opinion.

 

 

I hereby affix my signature to this Notarized
Certificate and hereby confirm the accuracy of the statements made herein.

 

 

Signed: /s/ Andrea Alexander__________Date:
11/13/18_____________

 

Name: Amdrea Alexander_____________Title:
Corporate Secretary______ 

 

 

 

SUBSCRIBED AND SWORN TO BEFORE ME ON THIS
12th DAY OF

November 2018.

Commission Expires:: 11/13/2021

/s/ Jacob A. Wessel

Notary Public

 

    	 	16	 

     

    

  

EXHIBIT D

 

TO:Tangiers Global, LLC

FROM:Smoke
Cartel, Inc.

DATE:November 13, 2018

RE:Disbursement
of Funds

 

Pursuant to that certain Fixed Convertible Promissory Note between
the parties listed above and dated November 13, 2018, a disbursement of funds will take place in the amount and manner described
below:

 

	Please disburse to:	 
	Amount to disburse:	$160,000
	Form of distribution	Wire
	Name	Smoke Cartel, Inc.
	Company Address	
         

         

         

	Wire Instructions:	
        Bank: 

        ABA Routing Number: 

        Account Number: 

        SWIFT Code:

        Account Name:

        Phone:

 

TOTAL: $160,000

 

For: Smoke Cartel, Inc.

 

 

By: /s/ Darby Cox

Dated: November 13, 2018

 

Name: Darby Cox

Its: CEO

 

    	 	17	 

     

    

 

EXHIBIT E

 

COMPANY CAPITALIZATION TABLE AS OF NOVEMBER
13, 2018

 

COMMON STOCK AND COMMON STOCK EQUIVALENTS

ISSUED, OUTSTANDING AND RESERVED

 

	DESCRIPTION	    AMOUNT
	Authorized Common Stock	    380,000,000    
	    Authorized Capital Stock	 
	    Authorized Common Stock	        
	    Issued Common Stock  	         
	    Outstanding Common Stock	 
	    Treasury Stock	     
    21,760,151                 
	*Authorized, but unissued	       
	 	 
	Authorized Preferred Stock	 
	Issued Preferred Stock	          
	 	 
	Reserved for Equity Incentive Plans	 
	Reserved for Convertible Debt	 
	Reserved for Options and Warrants	 
	Reserved for Other Purposes	 
	 	 
	
        TOTAL COMMON STOCK AND COMMON

        STOCK EQUIVALENTS OUTSTANDING
	
        21,760,151

         

 

 

* This number includes all shares reserved for
Convertible Debt

 

Note: If not applicable, enter “n/a”
or “zero” in Column 2.

 

    	 	18	 

     

    

 

CURRENT DEBT AND LIABILITIES TABLE

 

CONVERTIBLE PROMISSORY NOTE BALANCES AND
PROMISSORY NOTE BALANCES

 

	DESCRIPTION	     ISSUANCE DATE	AMOUNT
	Convertible Promissory Note	        	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	Promissory Note	 	 
	 Lending Club	12/6/17	$26,364.88
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	Other Debt and Liabilities	        	 
	Credit Cash Loan	5/29/18	$416,870
	 	 	 
	Citizens Auto Loan	4/4/17	$14,559
	 	 	 
	 	 	 

 

 

Note: If not applicable, enter “n/a”
or “zero” in Column 2.

 

To my best knowledge and after completing
the aforementioned review of the Company’s stockholder and corporate records, I am able to certify the accuracy of the statements
made herein.

 

 

 

SMOKE CARTEL, INC.

 

 

By: /s/ Darby Cox

Dated: November
13, 2018

Name:Darby Cox

 

Title: CEO

 

    	 	19	 

     

    

 

SCHEDULE 1

 

USE OF PROCEEDS

 

 

Pursuant to that certain Fixed Convertible Promissory Note between
the parties listed above and dated November 13, 2018, the Company covenants that it will within, _____________ month(s) of the
Effective Date of the Note, it shall use approximately $100,000 of the proceeds in the manner set forth below (the “Use
of Proceeds”):

 

 

 

Inventory

 

Annual Audit Expenses

 

Advertising Expenses

 

 

SMOKE CARTEL, INC.

 

 

By: /s/ Darby Cox

Dated: November 13, 2018

Name: Darby Cox

 

Title: CEO

 

    	 	20

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