Document:

Exhibit 10.43 Amended Note

Exhibit 10.43

NINTH AMENDED AND RESTATED

SENIOR SECURED CONVERTIBLE PROMISSORY NOTE

$17,500,000

Keego Harbor, Michigan

March 1, 2017

FOR VALUE RECEIVED, ZIVO BIOSCIENCE, INC., a Nevada corporation (“Borrower”), whose address is 2804 Orchard Lake Road, Suite 202, Keego Harbor, Michigan 48320, promises to pay to the order of HEP INVESTMENTS LLC, a Michigan limited liability company (“Lender”), whose address is 2804 Orchard Lake Road, Suite 205, Keego Harbor, Michigan 48320, or at such other place as Lender may designate in writing, in lawful money of the United States of America, the principal sum of up to Seventeen Million Five Hundred Thousand Dollars ($17,500,000), or such lesser sum as shall have been advanced by Lender to Borrower under the loan agreement hereinafter described, together with interest as provided herein, in accordance with the terms of this Ninth Amended and Restated Senior Secured Convertible Promissory Note (this “Note”). 

In accordance with the terms of that certain Loan Agreement, dated as of December 1, 2011, by and between Lender and Borrower (as amended or restated from time to time, the “Loan Agreement”), Lender intends to loan to the Borrower up to Seventeen Million Five Hundred Thousand Dollars ($17,500,000). All advances made hereunder shall be charged to a loan account in Borrower's name on Lender's books, and Lender shall debit to such account the amount of each advance made to, and credit to such account the amount of each repayment made by Borrower. From time to time but not less than quarterly, Lender shall furnish Borrower a statement of Borrower's loan account, which statement shall be deemed to be correct, accepted by, and binding upon Borrower, unless Lender receives a written statement of exceptions from Borrower within ten (10) days after such statement has been furnished. Terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Loan Agreement. Lender and Borrower acknowledge and agree that, as of March 1, 2017, the total outstanding indebtedness under this Note was $12,982,203, inclusive of interest accrued through February 28, 2017.

1.

Payment. The unpaid principal balance of this Note shall bear interest computed upon the basis of a year of 360 days for the actual number of days elapsed in a month at a rate of eleven percent (11%) per annum (the “Effective Rate”). Upon the occurrence and during the continuance of an Event of Default (as defined below), the unpaid principal balance of this Note shall bear interest, computed upon the basis of a year of 360 days for the actual number of days elapsed in a month, at a rate equal to the lesser of five percent (5%) over the Effective Rate or the highest rate allowed by applicable law. The indebtedness represented by this Note shall be paid to Lender in monthly installments of interest only beginning on July 1, 2017 and continuing on the 1st day of each month thereafter and, if not sooner converted in accordance with the terms of this Note, the entire unpaid principal balance of this Note, together with all accrued and unpaid interest, shall be immediately due and payable in full on September 30, 2018 (the “Due Date”). 

2.

Pre-payment Premium. Borrower may prepay the principal balance of this Note, in whole or in part, plus all accrued interest then outstanding upon sixty (60) days prior written notice to Lender; provided, however, there shall be a pre-payment premium of five (5%) percent of each amount prepaid at any time during the term of this Note.

3.

Use of Proceeds. The funds advanced pursuant to this Note shall be used by Borrower for working capital. 

4.

Conversion Right and Funding Provisions. 

(a)

At Lender’s option, at any time prior to the repayment in full of this Note, all or any portion of the outstanding indebtedness of this Note (including accrued and unpaid interest) may be converted into validly issued and fully paid shares of common stock of Borrower (“Shares”) at the conversion rate of $0.10 per share (as appropriately adjusted by any stock split, stock combination or other corporate recapitalization affecting such common stock occurring after the date hereof).

(b)

Upon conversion of this Note as provided herein, (i) the portion of this Note so converted shall be deemed cancelled and shall be converted into the Shares as specified above; (ii) Lender, by acceptance of this Note, agrees to deliver the executed original of this Note to Borrower within ten (10) days of the conversion of the entire outstanding indebtedness of this Note and to execute such documents as are necessary to document the issuance of the Shares and to comply with applicable securities laws; and (iii) as soon as practicable after Borrower’s receipt of the documents referenced above, Borrower shall issue and deliver to Lender (or its designee) stock certificates evidencing the Shares (or confirmation that the Shares are held by Lender (or its designee) in book entry form on the books and records of Borrower’s transfer agent) and Borrower shall deliver to Lender a promissory note (in the form of this Note) reflecting the balance of the outstanding indebtedness under this Note. 

5.

Default. Each of the following constitutes an “Event of Default” under this Note:

(a)

Borrower’s failure to pay the outstanding indebtedness of this Note within ten (10) days of the date on which such payment is due hereunder, whether at maturity or otherwise;

(b)

Borrower’s breach of or failure to perform or observe any covenant, condition or agreement contained in this Note, the Loan Agreement or the Security Agreement (defined below), which breach or failure continues unremedied for a period of thirty (30) calendar days after receipt by Borrower of written notice specifying the nature of the default. Notwithstanding the foregoing, Borrower shall not be in default under this subsection (b) with respect to any non-monetary breach that can be cured by the performance of affirmative acts if Borrower promptly commences the performance of said affirmative acts and diligently prosecutes the same to completion within a period of forty-five (45) calendar days after receipt by Borrower of written notice specifying the nature of the default; 

(c)

Borrower files a voluntary petition in bankruptcy; 

(d)

Borrower makes a general assignment for the benefit of its creditors or Borrower’s creditors file against Borrower any involuntary petition under any bankruptcy or insolvency law that is not dismissed within ninety (90) days after it is filed; 

(e)

Any court appoints a receiver to take possession of substantially all of Borrower’s assets and such receivership is not terminated within ninety (90) days after its appointment; or

(f)

Lender reasonably deems itself insecure with respect to the indebtedness under this Note.

Upon the occurrence and during the continuance of an Event of Default, at the election of Lender, the entire unpaid principal balance of this Note, together with all accrued and unpaid interest, shall be immediately due and payable in full.

6.

Security. This Note is secured by all of the assets of Borrower pursuant to that certain Security Agreement, dated as of December 1, 2011 (the “Security Agreement”), and that certain Patent, Copyright, License and Trademark Security Agreement, dated as of December 2, 2011.

7.

Waivers. Borrower and all endorsees, sureties and guarantors hereof hereby jointly and severally waive presentment for payment, demand, notice of non-payment, notice of protest or protest of this Note, and Lender diligence in collection or bringing suit, and do hereby consent to any and all extensions of time, renewals, waivers or modifications as may be granted by Lender with respect to payment or any other provisions of this Note. The liability of Borrower under this Note shall be absolute and unconditional, without regard to the liability of any other party. 

8.

Usury. Notwithstanding anything herein to the contrary, in no event shall Borrower be required to pay a rate of interest in excess of the Maximum Rate. The term “Maximum Rate” shall mean the maximum non-usurious rate of interest that Lender is allowed to contract for, charge, take, reserve or receive under the applicable laws of any applicable state or of the United States of America (whichever from time to time permits the highest rate for the use, forbearance or detention of money) after taking into account, to the extent required by applicable law, any and all relevant payments or charges hereunder, or under any other document or instrument executed and delivered in connection therewith and the indebtedness evidenced hereby. 

In the event Lender ever receives, as interest, any amount in excess of the Maximum Rate, such amount as would be excessive interest shall be deemed a partial prepayment of principal, and, if the principal hereof is paid in full, any remaining excess shall be returned to Borrower. In determining whether or not the interest paid or payable, under any specified contingency, exceeds the Maximum Rate, Borrower and Lender shall, to the maximum extent permitted by law, (a) characterize any non-principal payment as an expense, fee, or premium rather than as interest; (b) exclude voluntary prepayments and the effects thereof; and (c) amortize, prorate, allocate and spread the total amount of interest through the entire contemplated term of such indebtedness until payment in full of the principal (including the period of any extension or renewal thereof) so that the interest on account of such indebtedness shall not exceed the Maximum Rate.

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9.

Miscellaneous.

(a)

All modifications, consents, amendments or waivers of any provision of any this Note shall be effective only if in writing and signed by Lender and then shall be effective only in the specific instance and for the limited purpose for which given. 

(b)

All communications provided in this Note shall be personally delivered or mailed, postage prepaid, by registered or certified mail, return receipt requested, to the addresses set forth at the beginning of this Note or such other addresses as Borrower or Lender may indicate by written notice.

(c)

The headings used in this Note are for convenience of reference only and shall not in any way affect the meaning or interpretation of this Note.

(d)

This Note shall be binding upon and inure to the benefit of Borrower and Lender and their respective successors and assigns; provided, however, that neither party may, without the prior written consent of the other party, assign any rights, powers, duties or obligations under this Note. 

(e)

This Note shall be construed and enforced in accordance with the laws of the State of Michigan. All actions arising out of or relating to this Note shall be heard and determined exclusively by any state or federal court with jurisdiction in the Eastern District of the State of Michigan. Consistent with the preceding sentence, the parties hereto hereby irrevocably waive, and agree not to assert by way of motion, defense, or otherwise, in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the action is brought in an inconvenient forum, that the venue of the action is improper, or that this Note or the transactions contemplated by this Note may not be enforced in or by any of the above-named courts.

(f)

This Note is intended to amend and restate, and is not intended to be in substitution for or a novation of, that certain Senior Secured Convertible Promissory Note, dated December 1, 2011, executed and delivered by Borrower in favor of Lender in the original principal amount of $2,000,000, as previously amended and restated (the “Original Note”). This Note shall continue to be secured by the security instruments and UCC statements executed and filed with the Original Note, and otherwise as set forth in the loan documentation executed in connection with the Original Note.

[Signature on the following page]

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IN WITNESS WHEREOF, the undersigned has duly executed this Ninth Amended and Restated Senior Secured Convertible Promissory Note as of the day and year first written above.

BORROWER:

ZIVO BIOSCIENCE, INC.

By: /s/Philip M. Rice II                     

Name: Philip M. Rice II

Its: Chief Financial Officer

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EXHIBIT 10.1

SECURITIES PURCHASE AGREEMENT

This SECURITIES PURCHASE AGREEMENT (this
“Agreement”), dated as of February 2, 2017, is entered
into by and between FRIENDABLE, INC., a Nevada corporation
(the “Company”), and EMA
Financial, LLC, a Delaware limited liability company (the
“Purchaser”).

WHEREAS, subject to
the terms and conditions set forth in this Agreement and pursuant
to Section 4(2) of the Securities Act of 1933, as amended (the
“Securities Act” or “1933 Act”), and Rule
506 promulgated thereunder by the
United States Securities and Exchange Commission (the
“SEC”), the Company desires to issue and sell to
the Purchaser, and the Purchaser desires to purchase from the
Company a 8% Convertible Note of the
Company, in the form attached hereto as Exhibit A, in the principal
amount of $159,750.00 (together with any note(s) issued in
replacement thereof or as interest thereon or otherwise with
respect thereto in accordance with the terms thereof, the
“Note”), convertible into shares (“Conversion
Shares”) of common stock, $0.0001 par value per share (the
“Common Stock”), of the Company, upon the terms and
subject to the limitations and conditions set forth in such
Note.

NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the Company
and the Purchaser agree as follows:

1.

Purchase and Sale of Note.

a) Purchase of
Note. On the Closing Date (as
defined below), the Company shall issue and sell to the Purchaser,
and the Purchaser agrees to purchase from the Company, the Note for
an aggregate purchase price of $159,750.00 (“Purchase
Price”).

b) Form of
Payment. On the Closing Date
(i) the Purchaser shall pay the Purchase Price by wire transfer of
immediately available funds to the Company, in accordance with the
Company’s written wiring instructions, simultaneously with
delivery of the Note, and (ii) the Company shall deliver such Note
duly executed on behalf of the Company to the Purchaser,
simultaneously with delivery of such Purchase
Price.

c) Closing
Date. Subject to the
satisfaction (or written waiver) of the conditions thereto set
forth in Section 6 and Section 7 below, the closing of the
transactions contemplated by this Agreement (the
“Closing”) shall occur on the first business day
following the date hereof or such other mutually agreed upon time
(the “Closing Date”) at the offices of
Purchaser’s counsel.

2. Purchaser’s
Representations and Warranties. The Purchaser represents and warrants to the
Company that:

a) Investment
Purpose. Purchaser is acquiring
the Securities for its own account and not with a view towards, or
for resale in connection with, the public sale or distribution
thereof in violation of applicable securities laws; provided,
however, by making the representations herein, Purchaser does not
agree, or make any representation or warranty, to hold any of the
Securities for any minimum or other specific term and reserves the
right to dispose of the Securities at any time in accordance with
or pursuant to a registration statement or an exemption under the
1933 Act. The Purchaser is acquiring the Securities hereunder in
the ordinary course of its business. The Purchaser does not
presently have any agreement or understanding, directly or
indirectly, with any person to distribute any of the Securities in
violation of applicable securities laws.

 

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b) Accredited Investor
Status. The Purchaser is an
“accredited investor” as that term is defined in Rule
501(a) of Regulation D (an “Accredited
Investor”).

c) Reliance on
Exemptions. The Purchaser
understands that the Securities are being offered and sold to it in
reliance upon specific exemptions from the registration
requirements of United States federal and state securities laws and
that the Company is relying upon the truth and accuracy of, and the
Purchaser’s compliance with, the representations, warranties,
agreements, acknowledgments and understandings of the Purchaser set
forth herein in order to determine the availability of such
exemptions and the eligibility of the Purchaser to acquire the
Securities.

d) Information.
The Purchaser and its advisors, if any, have been, and for so long
as the Securities remain outstanding will continue to be, furnished
with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and
sale of the Securities which have been reasonably requested by the
Purchaser or its advisors, provided that the Purchaser has not been
furnished with, and the Company shall not in the future deliver to
the Purchaser without its consent, any material non-public
information concerning the Company. The Purchaser and its advisors,
if any, have been, and for so long as the Securities remain
outstanding will continue to be, afforded the opportunity to ask
questions of the Company. Neither such inquiries nor any other due
diligence investigation conducted by Purchaser or any of its
advisors or representatives shall modify, amend or affect
Purchaser’s right to rely on the Company’s
representations and warranties contained in Section 3 below. The
Purchaser understands that its investment in the Securities
involves a significant degree of risk.

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

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

 

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g) Legends.
The Purchaser understands
that the Securities have been issued (or will be issued in the case
of the Conversion Shares) pursuant to an exemption from
registration or qualification under the 1933 Act and applicable
state securities laws, and except as set forth below, the
Securities shall bear any legend as required by the “blue
sky” laws of any state and a restrictive legend in
substantially the following form (and a stop-transfer order may be
placed against transfer of such stock certificates):

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

The
legend set forth above shall be removed and the Company shall issue
a certificate without such legend to the holder of any Security
upon which it is stamped, if, unless otherwise required by
applicable state securities laws, (a) such Security is registered
for sale under an effective registration statement filed under the
1933 Act or otherwise may be sold pursuant to Rule 144 or
Regulation S without any restriction as to the number of securities
as of a particular date that can then be immediately sold, or (b)
such holder provides the Company with an opinion of counsel at the
Company’s expense, in the form, substance and scope customary
for opinions of counsel in comparable transactions, to the effect
that a public sale or transfer of such Security may be made without
registration under the 1933 Act, which opinion shall be reasonably
accepted by the Company so that the sale or transfer is effected.
The Purchaser agrees to sell all Securities, including those
represented by a certificate(s) from which the legend has been
removed, in compliance with applicable prospectus delivery
requirements, if any.

 

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

3. Representations
and Warranties of the Company.
The Company represents and warrants to the Purchaser, as of the
date hereof and the Closing Date, that:

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

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

 

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c) Capitalization.
As of the date hereof, the authorized capital stock of the Company,
and number of shares issued and outstanding, is as set forth in the
Company’s most recent periodic report filed with the SEC.
Except as disclosed on Schedule 3(c) hereof, no shares are reserved
for issuance pursuant to the Company’s stock option plans.
Except as disclosed in the SEC Documents no shares are reserved for
issuance pursuant to securities exercisable for, or convertible
into or exchangeable for shares of Common Stock. All of such
outstanding shares of capital stock are, or upon issuance will be,
duly authorized, validly issued, fully paid and non-assessable. No
shares of capital stock of the Company are subject to preemptive
rights or any other similar rights of the shareholders of the
Company or any liens or encumbrances imposed through the actions or
failure to act of the Company. As of the effective date of this
Agreement, and except as disclosed in the SEC Documents, (i) there
are no outstanding options, warrants, scrip, rights to subscribe
for, puts, calls, rights of first refusal, agreements,
understandings, claims or other commitments or rights of any
character whatsoever relating to, or securities, notes or rights
convertible into or exchangeable for any shares of capital stock of
the Company or any of its Subsidiaries, or arrangements by which
the Company or any of its Subsidiaries is or may become bound to
issue additional shares of capital stock of the Company or any of
its Subsidiaries, (ii) there are no agreements or arrangements
under which the Company or any of its Subsidiaries is obligated to
register the sale of any of its or their securities under the 1933
Act and (iii) there are no anti-dilution or price adjustment
provisions contained in any security issued by the Company (or in
any agreement providing rights to security holders) that will be
triggered by the issuance of any of the Securities. The Company has
furnished to the Purchaser true and correct copies of the
Company’s Certificate of Incorporation as in effect on the
date hereof (“Certificate of Incorporation”), the
Company’s By-laws, as in effect on the date hereof (the
“By-laws”), and the terms of all securities convertible
into or exercisable for Common Stock of the Company and the
material rights of the holders thereof in respect
thereto.

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

e) Acknowledgment of
Dilution. The Company’s
executive officers and directors understand the nature of the
Securities being sold hereby and recognize that the issuance of the
Securities will have a potential dilutive effect on the equity
holdings of other holders of the Company’s equity or rights
to receive equity of the Company.  The board of directors
of the Company has concluded, in its good faith business judgment
that the issuance of the Securities is in the best interests of the
Company.  The Company specifically acknowledges that its
obligation to issue the Conversion Shares upon conversion of the
Notes is binding upon the Company and enforceable regardless of the
dilution such issuance may have on the ownership interests of other
stockholders of the Company or parties entitled to receive equity
of the Company.

 

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

 

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

h) Absence of Certain
Changes. Since November 15,
2016, there has been no material adverse change and no material
adverse development in the assets, liabilities, business,
properties, operations, financial condition, results of operations,
prospects or 1934 Act reporting status of the Company or any of its
Subsidiaries.

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

 

7

 

 

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

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

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

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

 

8

 

 

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

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

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

q) Brokers.
The Company hereby represents and warrants that it has not
hired, retained or dealt with any broker, finder, consultant,
person, firm or corporation in connection with the negotiation,
execution or delivery of this Agreement or the transactions
contemplated hereunder. The Company covenants and agrees that
should any claim be made against Purchaser for any commission or
other compensation by any broker, finder, person, firm or
corporation, including without limitation, the Broker, based upon
the Company’s engagement of such person in connection with
this transaction, the Company shall indemnify, defend and hold
Purchaser harmless from and against any and all damages, expenses
(including attorneys’ fees and disbursements) and liability
arising from such claim. The Company shall pay the commission of
the Broker, to the attention of the Broker, pursuant to their
separate agreement(s) between the Company and the
Broker.

r) Permits;
Compliance. The Company and
each of its Subsidiaries is in possession of all franchises,
grants, authorizations, licenses, permits, easements, variances,
exemptions, consents, certificates, approvals and orders necessary
to own, lease and operate its properties and to carry on its
business as it is now being conducted (collectively, the
“Company Permits”), and there is no action pending or,
to the knowledge of the Company, threatened regarding suspension or
cancellation of any of the Company Permits. Neither the Company nor
any of its Subsidiaries is in conflict with, or in default or
violation of, any of the Company Permits, except for any such
conflicts, defaults or violations which, individually or in the
aggregate, would not reasonably be expected to have a Material
Adverse Effect. Since November 15, 2016, neither the Company nor
any of its Subsidiaries has received any notification with respect
to possible conflicts, defaults or violations of applicable laws,
except for notices relating to possible conflicts, defaults or
violations, which conflicts, defaults or violations would not have
a Material Adverse Effect.

 

9

 

 

s) Environmental
Matters.

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

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

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

t) Title to
Property. The Company and its
Subsidiaries have good and marketable title in fee simple to all
real property and good and marketable title to all personal
property owned by them which is material to the business of the
Company and its Subsidiaries, in each case free and clear of all
liens, encumbrances and defects except such as are described in
Schedule 3(t) or such as would not have a Material Adverse Effect.
Any real property and facilities held under lease by the Company
and its Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as would not have a
Material Adverse Effect.

 

10

 

 

u) Insurance.
The Company and its Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks
and in such coverage amounts as are prudent and customary in the
businesses in which the Company is engaged, including, but not
limited to, directors and officers insurance coverage with coverage
amounts that are at least equal to the aggregate Purchase Price.
Neither the Company nor any Subsidiary has any reason to believe
that it will not be able to renew its existing insurance coverage
as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business
without a significant increase in cost.

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

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

x) Solvency.
Except as disclosed in the SEC Documents, the Company (after giving
effect to the transactions contemplated by this Agreement) is
solvent (i.e.,
its assets have a fair market value in excess of the amount
required to pay its probable liabilities on its existing debts as
they become absolute and matured) and currently the Company has no
information that would lead it to reasonably conclude that the
Company would not, after giving effect to the transaction
contemplated by this Agreement, have the ability to, nor does it
intend to take any action that would impair its ability to, pay its
debts from time to time incurred in connection therewith as such
debts mature.

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

 

11

 

 

z) No “Shell”. The
Company is not, and has not
at any time previously been a Shell Company, as defined in Rule
144.

 

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

 

4.

COVENANTS.

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

b) Form D; Blue Sky
Laws. The Company agrees to
timely file a Form D with respect to the Securities as required
under Regulation D and to provide a copy thereof to the Purchaser
promptly after such filing. The Company shall, on or before the
Closing Date, take such action as the Company shall reasonably
determine is necessary to qualify the Securities for sale to the
Purchaser at the applicable closing pursuant to this Agreement
under applicable securities or “blue sky” laws of the
states of the United States (or to obtain an exemption from such
qualification), and shall provide evidence of any such action so
taken to the Purchaser on or prior to the Closing
Date.

c) Use of
Proceeds. The Company shall use
the proceeds from the sale of the Securities for general
corporate purposes, marketing and sales, product development, key
personnel recruiting and business development purposes.

d) Financial
Information. Upon written
request of the Purchaser, the Company agrees to send or make
available the following reports to the Purchaser until the
Purchaser transfers, assigns, or sells all of the Securities: (i)
within ten (10) days after the filing (or the applicable deadline
to so file) with the SEC or OTC Markets Group, a copy of its Annual
Report and its Quarterly Reports and any Supplemental Reports; (ii)
within one (1) day after release, copies of all press releases
issued by the Company or any of its Subsidiaries; and (iii)
contemporaneously with the making available or giving to the
shareholders of the Company, copies of any notices or other
information the Company makes available or gives to such
shareholders. Notwithstanding the foregoing, the Company shall not
disclose any material nonpublic information to the Purchaser
without its consent unless such information is disclosed to the
public prior to or promptly following such disclosure to the
Purchaser.

e) Listing.
The Company will obtain and, so long as the Purchaser owns any of
the Securities, maintain the listing and trading of its Common
Stock on the OTCBB, and OTCQB, or OTC Pink or any equivalent
replacement exchange, the NASDAQ Stock Market
(“NASDAQ”), the New York Stock Exchange
(“NYSE”), or the NYSE MKT, f/k/a American Stock
Exchange (“AMEX”), and will comply in all respects with
the Company’s reporting, filing and other obligations under
the bylaws or rules of the Financial Industry Regulatory Authority
(“FINRA”) and such exchanges, as applicable. The
Company shall promptly provide to the Purchaser copies of any
notices it receives from the SEC, OTC Markets Group and any other
exchanges or quotation systems on which the Common Stock is then
listed regarding the continued eligibility of the Common Stock for
listing on such exchanges and quotation systems, provided that it
shall not provide any notices constituting material nonpublic
information.

 

12

 

 

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

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

h) Securities Laws Disclosure;
Publicity. The Company shall comply with applicable
securities laws by filing a Current Report on Form 8-K, within four
(4) Trading Days following the date hereof, disclosing all the
material terms of the transactions contemplated hereby, if the
Company deems the transactions contemplated hereby to constitute
material non-public information. The Company and Purchaser shall
consult with each other in issuing any other press releases with
respect to the transactions contemplated hereby, and neither the
Company nor Purchaser shall issue any such press release or
otherwise make any such public statement without the prior consent
of the Company, with respect to any press release of any Purchaser,
or without the prior consent of Purchaser, with respect to any
press release of the Company, 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.

 

i) Non-Public Information. Except
with respect to the material terms and conditions of the
transactions contemplated by this Agreement, the Company covenants
and agrees that neither it nor any other person acting on its
behalf will provide the Purchaser or its agents or counsel with any
information that the Company believes constitutes material
non-public information, unless prior thereto the Purchaser shall
have executed a written agreement regarding the confidentiality and
use of such information. The Company understands and confirms that
the Purchaser shall be relying on the foregoing covenant in
effecting transactions in securities of the Company.

 

j) Subsidiaries. So long as the
Note remains outstanding, the Company shall not transfer any assets
or rights to any of its subsidiaries or permit any of its
subsidiaries to engage in any significant business or operations,
whether such subsidiaries are currently existing or hereafter
created.

 

 

13

 

 

k) Insurance. So long as the Note
remains outstanding, the Company and its Subsidiaries shall
maintain in full force and effect insurance reasonably believed by
the Company to be adequate coverage (a) on all assets and
activities, covering property loss or damage and loss of income by
fire or other hazards or casualty, and (b) against all liabilities,
claims and risks for which it is customary for companies similarly
situated to the Company to insure, including without limitation
applicable product liability insurance, required workmen’s
compensation insurance, and other insurance covering injury or
damage to persons or property, but excluding directors and officers
insurance coverage. The Company shall promptly furnish or cause to
be furnished evidence of such insurance to the Purchaser, in form
and substance reasonably satisfactory to the
Purchaser.

 

l) Par Value. If the closing bid
price at any time the Note is outstanding falls below $0.0005, the Company shall cause the par
value of its Common Stock to be reduced to $0.00001 or less.

 

m) [Intentionally
Omitted].

 

n) [Intentionally
Omitted].

 

5. Transfer Agent
Instructions. Upon receipt of a
duly executed Notice of Conversion, the Company shall issue
irrevocable instructions to its transfer agent to issue
certificates, registered in the name of the Purchaser or its
nominee, for the Conversion Shares in such amounts as specified
from time to time by the Purchaser to the Company upon conversion
of the Note, or any part thereof, in accordance with the terms
thereof (the “Irrevocable Transfer Agent
Instructions”). In the event that the Company proposes to
replace its transfer agent, the Company shall provide, prior to the
effective date of such replacement, a fully executed Irrevocable
Transfer Agent Instructions in a form as initially delivered
pursuant to this Agreement and the Securities (including but not
limited to the provision to irrevocably reserve shares of Common
Stock in the Reserved Amount (as defined in the Note)) signed by
the successor transfer agent to Company and the Company. Prior to
registration of the Conversion Shares under the 1933 Act or the
date on which the Conversion Shares may be sold pursuant to Rule
144 without any restriction as to the number of Securities as of a
particular date that can then be immediately sold, all such
certificates shall bear the restrictive legend specified in Section
2(g) of this Agreement. The Company warrants that: (i) no
instruction other than the Irrevocable Transfer Agent Instructions
referred to in this Section 5, and stop transfer instructions to
give effect to Section 2(f) hereof (in the case of the Conversion
Shares, prior to registration of the Conversion Shares under the
1933 Act or the date on which the Conversion Shares may be sold
pursuant to Rule 144 without any restriction as to the number of
Securities as of a particular date that can then be immediately
sold), will be given by the Company to its transfer agent and that
the Securities shall otherwise be freely transferable on the books
and records of the Company as and to the extent provided in this
Agreement and the Note; (ii) it will not direct its transfer agent
not to transfer or delay, impair, and/or hinder its transfer agent
in transferring (or issuing)(electronically or in certificated
form) any certificate for Conversion Shares to be issued to the
Purchaser upon conversion of or otherwise pursuant to the Note as
and when required by the Note and this Agreement; and (iii) it will
not fail to remove (or direct its transfer agent not to remove or
impair, delay, and/or hinder its transfer agent from removing) any
restrictive legend (or to withdraw any stop transfer instructions
in respect thereof) on any certificate for any Conversion Shares
issued to the Purchaser upon conversion of or otherwise pursuant to
the Note as and when required by the Note and this Agreement.
Nothing in this Section shall affect in any way the
Purchaser’s obligations and agreement set forth in Section
2(g) hereof to comply with all applicable prospectus delivery
requirements, if any, upon re-sale of the Securities. If the
Purchaser provides the Company with (i) an opinion of counsel in
form, substance and scope customary for opinions in comparable
transactions, to the effect that a public sale or transfer of such
Securities may be made without registration under the 1933 Act and
such sale or transfer is effected or (ii) the Purchaser provides
reasonable assurances that the Securities can be sold pursuant to
Rule 144, the Company shall permit the transfer, and, in the case
of the Conversion Shares, promptly instruct its transfer agent to
issue one or more certificates, free from restrictive legend, in
such name and in such denominations as specified by the Purchaser.
The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Purchaser, by
vitiating the intent and purpose of the transactions contemplated
hereby. Accordingly, the Company acknowledges that the remedy at
law for a breach of its obligations under this Section 5 may be
inadequate and agrees, in the event of a breach or threatened
breach by the Company of the provisions of this Section, that the
Purchaser shall be entitled, in addition to all other available
remedies, to an injunction restraining any breach and requiring
immediate transfer, without the necessity of showing economic loss
and without any bond or other security being
required.

 

14

 

 

6. Injunction Posting
of Bond.  In the
event the Purchaser shall elect to convert the Note or any parts
thereof, the Company may not refuse conversion or exercise based on
any claim that Purchaser or anyone associated or affiliated with
Purchaser has been engaged in any violation of law, or for any
other reason. In connection with any injunction sought or attempted
by the Company, the Company shall be required to post a bond at
least equal to the greater of either: (i) the outstanding principal
amount of the Note; and (ii) the market value of the Conversion
Shares sought to be converted, exercised or issued, based on the
sale price per share of Common Stock on the principal market on
which it is traded.

7. Delivery of Unlegended
Shares.

a) Within three (3) business days (such third
business day being the “Unlegended Shares Delivery
Date”) after the business
day on which the Company has received (i) a notice that Conversion
Shares, or any other Common Stock held by the Purchaser has been
sold pursuant to a registration statement or Rule 144 under the
1933 Act, (ii) a representation that the prospectus delivery
requirements, or the requirements of Rule 144, as applicable and if
required, have been satisfied, (iii) the original share
certificates representing the shares of Common Stock that have been
sold, and (iv) in the case of sales under Rule 144, customary
representation letters of the Purchaser and, if required,
Purchaser’s broker regarding compliance with the requirements
of Rule 144, the Company at its expense, (y) shall deliver, and
shall cause legal counsel selected by the Company to deliver to its
transfer agent (with copies to Purchaser) an appropriate
instruction and opinion of such counsel, directing the delivery of
shares of Common Stock without any legends including the legend set
forth in Section 4(h) above (the
“Unlegended
Shares”); and (z) cause
the transmission of the certificates representing the Unlegended
Shares together with a legended certificate representing the
balance of the submitted Common Stock certificate, if any, to the
Purchaser at the address specified in the notice of sale, via
express courier, by electronic transfer or otherwise on or before
the Unlegended Shares Delivery Date.

 

15

 

 

b) The Company understands that a delay in the
delivery of the Unlegended Shares later than the Unlegended Shares
Delivery Date could result in economic loss to the Purchaser. As
compensation to Purchaser for such loss, the Company agrees to pay
late payment fees (as liquidated damages and not as a penalty) to
the Purchaser for late delivery of Unlegended Shares in the amount
of $1,000.00 per business day after the Unlegended Shares Delivery
Date. If during any three hundred and sixty (360) day period, the
Company fails to deliver Unlegended Shares as required by this
Section for an aggregate of thirty (30) days, then Purchaser or
assignee holding Securities subject to such default may, at its
option, require the Company to redeem all or any portion of the
shares subject to such default at a price per share equal to the
greater of (i) 200% of the most recent closing price of the Common
Stock or (ii) a fraction in which the numerator is the highest
closing price of the Common Stock during the aforedescribed thirty
(30) day period and the denominator of which is the lowest
conversion price during such thirty (30) day period, multiplied by
the conversion price or exercise price, as the case may be
(“Unlegended Redemption
Amount”). The Company
shall pay any payments incurred under this Section in immediately
available funds upon demand.

8. Conditions to the
Company’s Obligation to Sell. The obligation of the Company hereunder to issue
and sell the Note to the Purchaser at the Closing is subject to the
satisfaction, at or before the Closing Date of each of the
following conditions thereto, provided that these conditions are
for the Company’s sole benefit and may be waived by the
Company at any time in its sole discretion:

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

b) The
Purchaser shall have delivered the Purchase Price to the
Company.

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

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

9. Conditions to The
Purchaser’s Obligation to Purchase. The obligation of the Purchaser hereunder to
purchase the Note at the Closing is subject to the satisfaction, at
or before the Closing Date of each of the following conditions,
provided that these conditions are for the Purchaser’s sole
benefit and may be waived by the Purchaser at any time in its sole
discretion:

 

16

 

 

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

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

c) The
Irrevocable Transfer Agent Instructions, in form and substance
satisfactory to the Purchaser, shall have been delivered to and
acknowledged in writing by the Company’s Transfer Agent (a
copy of which written acknowledgment shall be provided to Purchaser
simultaneously with Closing).

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

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

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

g) The
Conversion Shares shall have been authorized for quotation on the
OTCBB, OTCQB, and OTC Pink and trading of the Common Stock on the
OTCBB, OTCQB, and OTC Pink shall not have been suspended by the SEC
or the OTC Markets Group.

10.  
Governing
Law; Miscellaneous.

 

17

 

 

a) Governing
Law. This Agreement shall be
governed by and construed in accordance with the laws of the State
of New York without regard to principles of conflicts of laws
thereof or any other State.  Any action brought by any
party against any other party hereto concerning the transactions
contemplated by this Agreement shall be brought only in the state
courts of New York or in the federal courts located in the state
and county of New York.  The parties to this Agreement
hereby irrevocably waive any objection to jurisdiction and venue of
any action instituted hereunder and shall not assert any defense
based on lack of jurisdiction or venue or based
upon forum
non conveniens.  The
parties executing this Agreement and other agreements referred to
herein or delivered in connection herewith on behalf of the Company
agree to submit to the in personam jurisdiction of such courts and
hereby irrevocably waive trial by
jury.  The prevailing party
shall be entitled to recover from the other party its reasonable
attorney’s fees and costs.  In the event that any
provision of this Agreement or any other agreement delivered in
connection herewith is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be
deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of
law.  Any such provision which may prove invalid or
unenforceable under any law shall not affect the validity or
enforceability of any other provision of any
agreement.  Each party hereto hereby irrevocably waives
personal service of process and consents to process being served in
any suit, action or proceeding in connection with this Agreement or
any other transaction document contemplated hereby by mailing a
copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect
for notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice
thereof.  Nothing contained herein shall be deemed to
limit in any way any right to serve process in any other manner
permitted by law.

b) Removal
of Restrictive Legends.  In the
event that Purchaser has any shares of the Company’s Common
Stock bearing any restrictive legends, and Purchaser, through its
counsel or other representatives, submits to the Transfer Agent any
such shares for the removal of the restrictive legends thereon in
connection with a sale of such shares pursuant
to any exemption to the registration requirements under
the Securities Act, and the Company and or its counsel refuses or
fails for any reason (except to the extent that such refusal or
failure is based solely on applicable law that would prevent the
removal of such restrictive legends) to render an opinion of
counsel or any other documents or certificates required for the
removal of the restrictive legends, then the Company hereby agrees
and acknowledges that the Purchaser is hereby irrevocably and
expressly authorized to have counsel to the Purchaser render any
and all opinions and other certificates or instruments which may be
required for purposes of removing such restrictive legends, and the
Company hereby irrevocably authorizes and directs the Transfer
Agent to, without any further confirmation or instructions from the
Company, issue any such shares without restrictive legends as
instructed by the Purchaser, and surrender to a common carrier for
overnight delivery to the address as specified by the Purchaser,
certificates, registered in the name of the Purchaser or its
designees, representing the shares of Common Stock to which the
Purchaser is entitled, without any restrictive legends and
otherwise freely transferable on the books and records of the
Company.

 

18

 

 

c) Filing
Requirements. From the
date of this Agreement until the Notes are no longer outstanding,
the Company will timely and voluntarily comply with all reporting
requirements that are applicable to an issuer with a class of
shares registered pursuant to Section 12(g) of the 1934 Act,
whether or not the Company is then subject to such reporting
requirements, and comply with all requirements related to any
registration statement filed pursuant to this Agreement. The
Company will use reasonable efforts not to take any action or file
any document (whether or not permitted by the 1933 Act or the 1934
Act or the rules thereunder) to terminate or suspend such
registration or to terminate or suspend its reporting and filing
obligations under said acts until the Notes are no longer
outstanding. The Company will maintain
the quotation or listing of its Common Stock on the OTCBB, OTCQB,
and OTC Pink, NYSE, or NASDAQ Stock Market (whichever of the
foregoing is at the time the principal trading exchange or market
for the Common Stock (the “Principal
Market”), and will comply
in all respects with the Company’s reporting, filing and
other obligations under the bylaws or rules of the Principal
Market, as applicable. The Company will provide Purchaser with
copies of all notices it receives notifying the Company of the
threatened and actual delisting of the Common Stock from any
Principal Market.  As of the date of this Agreement and
the Closing Date, the OTC Pink, is the Principal Market.
Until the Note is no longer outstanding, the Company will continue
the listing or quotation of the Common Stock on a Principal Market
and will comply in all respects with the Company’s reporting,
filing and other obligations under the bylaws or rules of the
Principal Market.

d) 144
Default. In the event
commencing twelve (12) months after the Closing Date and ending
twenty-four (24) months thereafter, the Purchaser is not permitted
to resell any of the Conversion Shares without any restrictive
legend or if such sales are permitted but subject to volume
limitations or further restrictions on resale as a result of the
unavailability to Subscriber of Rule 144(b)(1)(i) under the 1933
Act or any successor rule (a “144 Default”), for any reason except for
Purchasers’ status as an Affiliate or “control
person” of the Company, or as a result of a change in current
applicable securities laws, then the Company shall pay such
Purchaser as liquidated damages and not as a penalty an amount
equal to two percent (2%) of the value of Conversion Shares (based
on the closing sale of the Common Stock) subject to such 144
Default during the pendency of the 144 Default of each thirty day
period thereafter (or portion thereof).

e) Fees and Expenses. On or prior
to the Closing, the Company shall pay or reimburse to Purchaser a
non-refundable, non-accountable sum equal to $9,750.00 as and for
the fees, costs and expenses (including without limitation legal
fees and disbursements and due diligence and administrative
expenses) incurred by the Purchaser in connection with the
Purchaser’s due diligence and negotiation, preparation and
execution of the Transaction Documents and consummation of the
Transactions. The Purchaser may withhold and offset the balance of
such amount from the payment of its Purchase Price otherwise
payable hereunder at Closing, which offset shall constitute partial
payment of such Purchase Price in an amount equal to such offset.
Except as expressly set forth in this Agreement or the Note to the
contrary, each party shall pay the fees and expenses of its
advisers, counsel, accountants and other experts, if any, and all
other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement.
The Company shall pay all transfer agent fees, stamp taxes and
other taxes and duties levied in connection with the delivery of
any Securities to the Purchaser.

 

 

19

 

 

 

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

 

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

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

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

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

 

20

 

 

	

Purchaser:

	

EMA Financial, LLC

	
 

	

40 Wall Street, Suite 1700

	
 

	

New York, NY 10005

	
 

	

Attn: Felicia Preston

	
 

	

admin@emafin.com

	
 

	
 

	

Company:

	

Friendable, Inc.

	
 

	

1821 S. Beacon Ave, Suite 353

	
 

	

Campbell, CA 95008

	
 

	

Attn: Robert A. Rositano Jr., CEO

	
 

	

Email: ________________

	
 

	

Fax: ________________

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

 

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

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

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

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

 

21

 

 

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

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

q) Counterparts. This Agreement
may be executed in any number of counterparts, each of which when
so executed and delivered shall be deemed to be an original and all
of which together shall be deemed to be one and the same
agreement.

r) Signatures. Any signature
transmitted by facsimile, e-mail, or other electronic means shall
be deemed to be an original signature.

 

(Remainder
of page intentionally left blank)

 

 

 

 

 

 

 

 

 

 

22

 

 

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

FRIENDABLE, INC.

 

	

By:

	
/s/ Robert A. Rositano Jr.

	
 

	
 

	

Name:
Robert A. Rositano Jr.

	
 

	
 

	

Title:
CEO

	
 

 

 

EMA FINANCIAL, LLC

 

	

By:

	
/s/ 
Felicia
Preston

	
 

	

Name:

	
Felicia
Preston

	
 

	

Title:

	
 

	
 

 

 

 

GUARANTY

Each of
the undersigned subsidiaries of the Company jointly and severally,
absolutely, unconditionally and irrevocably, guarantees to the
Purchaser and their respective successors, indorsees, transferees
and assigns, the prompt and complete payment and performance by the
Company when due (whether at the stated maturity, by acceleration
or otherwise) of all amounts due under, and all other obligations
under, the Note. Each such subsidiary’s liability under this
Guaranty shall be unlimited, open and continuous for so long as
this Guaranty remains in force.

 

	

IHOOKUP - DE

 

By:
/s/ Robert A. Rositano
Jr.                                                    

Print
Name/Title: Robert A. Rositano Jr./CEO

 

 

	

 

 

 

 

 

 

23

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