Document:

ex10-1

  Exhibit
10.1

SECURITIES PURCHASE AGREEMENT

 

 

This
SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of March
19, 2021, is made by and among Charlie's Holdings, Inc., a
corporation organized under the laws of the State of Nevada (the
“Company”) and
each of the purchasers (individually, a “Purchaser” and collectively the
“Purchasers”)
set forth in the execution pages hereof (each, an
“Execution
Page” and collectively the “Execution Pages”).

 

RECITALS

 

WHEREAS, the Company and the Purchasers
are executing and delivering this Agreement in reliance upon the
exemption from securities registration afforded by the provisions
of Regulation D (“Regulation
D”), as promulgated by the United States Securities
and Exchange Commission (the “SEC”) under the Securities Act of
1933, as amended (the “Securities Act”);

 

WHEREAS, upon satisfaction of certain
conditions, the Purchasers, severally and not jointly, desire to
purchase, and the Company desires to issue and sell to the
Purchasers, upon the terms and subject to the conditions set forth
in this Agreement, an aggregate of 351,699,883 shares (the
“Shares”) of
the Company’s common stock, par value $0.001 per share
(“Common
Stock”).

 

NOW, THEREFORE, in consideration of the
premises and mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Purchasers hereby agree as
follows:

 

1. INVESTMENTS.

 

(a) Purchase Price. Subject to the
terms and conditions hereof, upon Closing (as defined below), the
Company shall issue and sell to each Purchaser, and each Purchaser,
severally and not jointly, shall purchase from the Company, that
number of set forth on such Purchaser’s Execution Page, for a
purchase price (as to each Purchaser, the “Purchase Price”) equal to
$0.00853 per Share.

 

(b) Method of Funding. Upon
satisfaction of the conditions precedent set forth in Sections 6
and 7 below (the "Closing"), each Purchaser shall fund
the Purchase Price for the Shares to be issued and sold to such
Purchaser on or before the Closing by wire transfer of immediately
available funds to the Company using the wire instructions attached
hereto as Exhibit
A.

 

(c) Delivery of Securities. At
Closing, the Company shall deliver to each Purchaser the Shares
purchased.

 

2. PURCHASERS’ REPRESENTATIONS AND
WARRANTIES.

 

Each
Purchaser, severally, but not jointly, represents and warrants to
the Company as follows:

 

(a) Purchase for Own Account, Etc.
Such Purchaser is purchasing the Shares for such Purchaser’s
own account for investment purposes only and not with a view
towards the public sale or distribution thereof, except pursuant to
sales that are exempt from the registration requirements of the
Securities Act and/or sales registered under the Securities Act.
Such Purchaser has substantial experience in evaluating and
investing in private placement transactions of securities in
companies similar to the Company, and is capable of evaluating the
merits and risks of its investment in the Company. Such Purchaser
understands that it must bear the economic risk of this investment
indefinitely, unless the Shares are registered pursuant to the
Securities Act and any applicable state securities or blue sky laws
or an exemption from such registration is available, and that the
Company has no present intention of registering the resale of any
such Shares. Notwithstanding anything in this Section 2(a) to the
contrary, by making the representations herein, such Purchaser does
not agree to hold the Shares for any minimum or other specific term
and reserves the right to dispose of the Shares at any time in
accordance with or pursuant to a registration statement or an
exemption from the registration requirements under the Securities
Act.

 

 

 

 

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

 

(c) Reliance on Exemptions. Such
Purchaser understands that the Shares are being offered and sold to
such Purchaser 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 such Purchaser’s compliance with, the
representations, warranties, agreements, acknowledgments and
understandings of such Purchaser set forth herein in order to
determine the availability of such exemptions and the eligibility
of such Purchaser to acquire the Shares.

 

(d) Information. All materials
relating to the business, finances and operations of the Company
(including the Company’s most recent Annual Report on Form
10-K and most recent Quarterly Report on Form 10-Q) and materials
relating to the offer and sale of the Shares which have been
specifically requested by such Purchaser or its counsel have been
made available to such Purchaser and its counsel, if any. Neither
such inquiries nor any other investigation conducted by such
Purchaser or its counsel or any of such Purchaser’s
representatives shall modify, amend or affect such
Purchaser’s right to rely on the Company’s
representations and warranties contained in Section 3 below. Such Purchaser
understands that its investment in the Shares involves a high
degree of risk, including the risk of loss of its entire investment
in the Shares.

 

(e) Governmental Review. Such
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 Shares.

 

(f) Transfer or Resale. Such
Purchaser understands that (i) the sale or resale of the Shares
have not been and are not being registered under the Securities Act
or any state securities laws, and the Shares may not be transferred
unless (A) the transfer is made pursuant to and as set forth in an
effective registration statement under the Securities Act covering
the Shares; or (B) such Purchaser shall have delivered to the
Company an opinion of counsel (which opinion shall be in form,
substance and scope customary for opinions of counsel in comparable
transactions) to the effect that the Shares to be sold or
transferred may be sold or transferred pursuant to an exemption
from such registration; or (C) sold under and in compliance with
Rule 144 promulgated under the Securities Act (including any
successor rule, “Rule
144”); or (D) sold or transferred to an affiliate of
such Purchaser that agrees to sell or otherwise transfer the Shares
only in accordance with the provisions of this Section 2(f) and
that is an Accredited Investor; and (ii) neither the Company nor
any other person is under any obligation to register such Shares
under the Securities Act or any state securities laws.
Notwithstanding the foregoing or anything else contained herein to
the contrary, the Shares may be pledged as collateral in connection
with a bona fide margin account or other lending arrangement,
provided such pledge is consistent with applicable laws, rules and
regulations.

 

(g) Legends. Such Purchaser
understands that the Shares have not been registered under the
Securities Act (including registration pursuant to Rule 416
thereunder) or otherwise may be sold by such Purchaser under Rule
144, the certificates for the Shares may bear a restrictive legend
in substantially the following form:

 

THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES OR IN ANY OTHER
JURISDICTION. THE SECURITIES REPRESENTED HEREBY MAY NOT BE OFFERED,
SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS
UNLESS OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE
LAWS.

 

 

 

 

 

The
Company shall, within five business days after any registration
statement covering the Shares is declared effective, deliver to its
transfer agent an opinion letter of counsel, opining that at any
time such registration statement is effective, the transfer agent
shall issue, in connection with the issuance of the Conversion
Shares, certificates representing such Conversion Shares without
the restrictive legend above, provided such Conversion Shares are
to be sold pursuant to the prospectus contained in such
registration statement. Upon receipt of such opinion, the Company
shall cause the transfer agent to confirm, for the benefit of the
holders, that no further opinion of counsel is required at the time
of transfer in order to issue such shares without such restrictive
legend.

 

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 state
securities laws, (i) the sale of such Security is registered under
the Securities Act (including registration pursuant to Rule 416
thereunder); (ii) such holder provides the Company with an opinion
of counsel, in form, substance and scope customary for opinions of
counsel in comparable transactions, to the effect that a public
sale or transfer of such Security may be made without registration
under the Securities Act; or (iii) such holder provides the Company
with reasonable assurances that such Security can be sold under
Rule 144. In the event the above legend is removed from any
Security and thereafter the effectiveness of a registration
statement covering such Security is suspended or the Company
determines that a supplement or amendment thereto is required by
applicable securities laws, then, upon reasonable advance written
notice to such Purchaser, the Company may require that the above
legend be placed on any such Security that cannot then be sold
pursuant to an effective registration statement or under Rule 144
and such Purchaser shall cooperate in the replacement of such
legend. Such legend shall thereafter be removed when such Security
may again be sold pursuant to an effective registration statement
or under Rule 144.

 

(h) Authorization; Enforcement.
This Agreement has been duly and validly authorized, executed and
delivered on behalf of such Purchaser and is valid and binding
agreements of such Purchaser enforceable against such Purchaser in
accordance with its terms, except as such enforceability may be
limited by general principles of equity or applicable bankruptcy,
insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally, the enforcement of
creditors’ rights and remedies.

 

(i) Residency. Such Purchaser is a
resident of the jurisdiction set forth under such Purchaser’s
name on the Execution Page hereto executed by such
Purchaser.

 

3. REPRESENTATIONS AND WARRANTIES OF THE
COMPANY.

 

Except
as set forth on a Disclosure Schedule executed and delivered by the
Company to each Purchaser (the “Disclosure Schedule”), the
Company represents and warrants to each Purchaser as
follows:

 

(a) Organization and Qualification;
Subsidiaries. The Company and each of its subsidiaries
(collectively, the “Subsidiaries”) is a corporation
duly organized and existing in good standing under the laws of the
jurisdiction in which it is incorporated or organized, and has the
requisite corporate power to own its properties and to carry on its
business as now being conducted. 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 the
nature of the business conducted by it makes such qualification
necessary and where the failure so to qualify would have, or would
reasonably be expected to result in, a Material Adverse Effect. For
purposes of this Agreement, “Material Adverse Effect” means
any material adverse effect on (i) the Shares, (ii) the ability of
the Company to perform its obligations under this Agreement or the
other Transaction Documents or (iii) the business, operations,
properties, prospects, financial condition or results of operations
of the Company and its Subsidiaries, taken as a whole. Other than
the Subsidiaries set forth on the Disclosure Schedule, the Company
has no subsidiaries.

 

 

 

 

(b) Authorization; Enforcement. (i)
The Company has the requisite corporate power and authority to
enter into and perform its obligations under this Agreement, to
issue and sell the Shares in accordance with the terms hereof; (ii)
the execution, delivery and performance of this Agreement by the
Company and the consummation by it of the transactions contemplated
hereby and thereby (including, without limitation, the issuance of
the Shares, and the issuance and reservation for issuance of the
Conversion Shares) 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 any committee of the Board of
Directors is required, and (iii) this Agreement constitutes the
valid and binding obligations of the Company enforceable against
the Company in accordance with their terms, except as such
enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally,
the enforcement of creditors’ rights and remedies. Neither
the execution, delivery or performance by the Company of its
obligations under this Agreement, nor the consummation by it of the
transactions contemplated hereby (including, without limitation,
the issuance of the Shares) requires any consent or authorization
of the Company’s stockholders.

 

(c) Issuance of Shares. The Shares
as duly authorized and, upon issuance in accordance with the terms
of this Agreement, (i) will be validly issued and free from all
taxes, liens, claims and encumbrances (other than restrictions on
transfer contained in this Agreement or the Certificate of
Designation), (ii) will not be subject to preemptive rights, rights
of first refusal or other similar rights of stockholders of the
Company or any other person and (iii) will not impose personal
liability on the holder thereof. The Shares are duly authorized and
reserved for issuance, and (x) will be validly issued, fully paid
and non-assessable, and free from all taxes, liens, claims and
encumbrances (other than restrictions on transfer contained in this
Agreement), (y) will not be subject to preemptive rights, rights of
first refusal or other similar rights of stockholders of the
Company or any other person and (z) will not impose personal
liability upon the holder thereof. Except for the filing of any
notice prior or subsequent to the Closing that may be required
under applicable state and/or federal securities laws (or
comparable laws of any other jurisdiction), no authorization,
consent, approval, license, exemption of or filing or registration
with any court or governmental department, commission, board,
bureau, agency, instrumentality or other third party, is or will be
necessary for, or in connection with, the execution and delivery by
the Company of this Agreement, for the offer, issue, sale,
execution or delivery of the Shares, or for the performance by the
Company of its obligations under this Agreement. No “bad
actor” disqualifying event described in Rule
506(d)(1)(i)-(viii) of the Securities Act (a “Disqualification Event”) is
applicable to the Company or, to the Company’s knowledge, any
Person listed in the first paragraph of Rule 506(d)(1), except for
a Disqualification Event as to which Rule 506(d)(2)(ii–iv) or
(d)(3), is applicable.

 

(d) No Conflicts. Except as set
forth in Section
3(e) of the Disclosure Schedule, the execution, delivery and
performance of this Agreement by the Company and the consummation
by the Company of the transactions contemplated hereby (including,
without limitation, the issuance of the Shares, and the issuance
and reservation for issuance of the Conversion Shares) will not (i)
result in a violation of the Articles of Incorporation or Bylaws,
(ii) conflict with, or constitute a default (or an event that with
notice or lapse of time or both would become a default) under, or
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, (iii) result in
a violation of any law, rule, regulation, order, judgment or decree
(including United States federal and state securities laws, rules
and regulations and rules and regulations of any self-regulatory
organizations to which either 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, or (iv) result in the imposition
of a mortgage, pledge, security interest, encumbrance, charge or
other lien on any asset of the Company or any Subsidiary (except,
with respect to clauses (ii) and (iii), for such conflicts,
defaults, terminations, amendments, accelerations, cancellations
and violations that would not, individually or in the aggregate,
have a Material Adverse Effect).

 

 

 

 

(e) Compliance. Neither the Company
nor any of its Subsidiaries is in violation of its Articles of
Incorporation, Bylaws or other organizational documents, and
neither the Company nor any of its Subsidiaries is in default (and
no event has occurred that with notice or lapse of time or both
would put the Company or any of its Subsidiaries in default) under,
nor has there occurred any event giving others (with notice or
lapse of time or both) 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. The businesses of the Company and its Subsidiaries are not
being conducted, and shall not be conducted so long as the
Purchaser (or any of its respective affiliates) own any of the
Shares, in violation of any law, ordinance or regulation of any
governmental entity, except for possible violations the sanctions
for which either singly or in the aggregate have not had and would
not have a Material Adverse Effect. 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, or made any bribe, rebate,
payoff, influence payment, kickback or other unlawful payment to
any foreign or domestic government official or employee. The
Company and its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal,
state, provincial or foreign regulatory authorities that are
material to the conduct to its business, and neither the Company
nor any of its Subsidiaries has received any notice of proceeding
relating to the revocation or modification of any such certificate,
authorization or permit. The Company has complied in all material
respects with and is not in default or violation in any material
respect of, and is not, to the Company’s knowledge, under
investigation with respect to or has not been, to the knowledge of
the Company, threatened to be charged with or given notice of any
violation of, any applicable federal, state, local or foreign law,
statute, ordinance, license, rule, regulation, policy or guideline,
order, demand, writ, injunction, decree or judgment of any federal,
state, local or foreign governmental or regulatory authority.
Except for statutory or regulatory restrictions of general
application, no federal, state, local or foreign governmental or
regulatory authority has placed any material restriction on the
business or properties of the Company.

 

(f) SEC Documents, Financial
Statements. The Company has timely filed (within applicable
extension periods) all reports, schedules, forms, statements and
other documents required to be filed by it with the SEC pursuant to
the reporting requirements of the Securities Exchange Act of 1934,
as amended (the “Exchange
Act”) (all of the foregoing filed prior to the date
hereof and all exhibits included therein and financial statements
and schedules thereto and documents incorporated by reference
therein, the “SEC
Documents”). As of their respective dates, the SEC
Documents complied in all material respects with the requirements
of the Exchange Act or the Securities Act, as the case may be, and
the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at
the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading. None of the statements made in any such
SEC Documents is, or has been, required to be amended or updated
under applicable law (except for such statements as have been
amended or updated in subsequent filings made prior to 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 applicable with
respect thereto. Such financial statements have been prepared in
accordance with U.S. generally accepted accounting principles
(“GAAP”),
consistently applied, during the periods involved (except as may be
otherwise indicated in such financial statements or the notes
thereto or, in the case of unaudited interim statements, to the
extent they may not include footnotes or may be condensed or
summary statements) 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 immaterial
year-end audit adjustments). Except as set forth in the financial
statements of the Company included in the Select SEC Documents (as
defined below), the Company has no liabilities, contingent or
otherwise, other than (i) liabilities incurred in the ordinary
course of business subsequent to the date of such financial
statements and (ii) obligations under contracts and commitments
incurred in the ordinary course of business and not required under
GAAP to be reflected in such financial statements, which
liabilities and obligations referred to in clauses (i) and (ii),
individually or in the aggregate, are not material to the financial
condition or operating results of the Company. For purposes of this
Agreement, “Select SEC
Documents” means the Company’s (A) Annual Report
on Form 10-K for the fiscal year ended December 31, 2019, (B)
Quarterly Reports on Form 10-Q for the fiscal quarters ended
March 31, 2020, June 30, 2020, and September 30, 2020 (C)
all Current Reports on Form 8-K filed since September 30,
2020.

 

 

 

 

(g) Listing. The Company is not in
violation of the listing requirements of the OTC:PINK Marketplace
(the “OTC:PINK”)
on which it trades, does not reasonably anticipate that the Common
Stock will be delisted by the OTC:PINK for the foreseeable future,
and has not received any notice regarding the possible delisting of
the Common Stock from the OTC:PINK.

 

(h) No General Solicitation or Integrated
Offering. Neither the Company nor any person acting for the
Company has conducted any “general solicitation” (as
such term is defined in Regulation D) with respect to any of the
Shares being offered hereby. 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 of any security or
solicited any offers to buy any security under circumstances that
would require registration of the Shares being offered hereby under
the Securities Act or cause this offering of Shares to be
integrated with any prior offering of securities of the Company for
purposes of the Securities Act, which result of such integration
would require registration under the Securities Act, or any
applicable stockholder approval provisions.

 

(i) No Brokers. The Company has
taken no action that would give rise to any claim by any person for
brokerage commissions, finder’s fees or similar payments by
any Purchaser relating to this Agreement or the transactions
contemplated hereby.

 

4. COVENANTS.

 

(a) Form D: Blue Sky Laws. The
Company shall timely file with the SEC a Form D with respect to the
Shares as required under Regulation D and provide a copy thereof to
each Purchaser promptly after such filing. The Company shall take
such action as the Company shall reasonably determine is necessary
to qualify the Shares for sale to each Purchaser pursuant to this
Agreement under applicable securities or “blue sky”
laws of the states of the United States or obtain exemption
therefrom, and shall provide evidence of any such action so taken
to each Purchaser upon such Purchaser's request. Within four
business days after the execution of this Agreement, the Company
shall file a Form 8-K with the SEC concerning this Agreement and
the transactions contemplated hereby, which Form 8-K shall attach
this Agreement and its Exhibits as exhibits to such Form 8-K, and,
within four business days after Closing, the Company shall file a
Form 8-K with the SEC concerning the issuance of the Shares to each
Purchaser on such date (the “8-K Filings”).

 

(b) Listing. The Company shall
maintain, so long as any Purchaser (or any of its affiliates)
beneficially owns any Shares on each national securities exchange,
automated quotation system or electronic bulletin board on which
shares of Common Stock are currently listed. The Company will use
its best efforts to continue the listing and trading of its Common
Stock on the OTC:PINK or the QTCQB Marketplace, and will comply in
all respects with the reporting, filing and other obligations under
the bylaws or rules of the Financial Industry Regulatory Authority
(“FINRA”), such
exchanges, or such electronic system, as applicable. The Company
shall promptly provide to each Purchaser copies of any notices it
receives regarding the continued eligibility of the Common Stock
for trading on the OTC:PINK or on any securities exchange or
automated quotation system on which securities of the same class or
series issued by the Company are then listed or quoted, if
any.

 

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

 

(d) Legal Compliance. The Company
shall conduct its business and the business of its Subsidiaries in
compliance with all laws, ordinances or regulations of governmental
entities applicable to such businesses, except where the failure to
do so would not have a Material Adverse Effect.

 

 

 

 

 

5. CONDITIONS TO THE COMPANY’S
OBLIGATION TO SELL.

 

The
obligation of the Company hereunder to issue and sell the Shares to
each Purchaser is subject to the satisfaction, at or before the
Closing, of each of the following conditions, 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) Each Purchaser
shall have executed such Purchaser’s Execution Page to this
Agreement and delivered the same to the Company.

 

(b) Each Purchaser
shall have delivered the full amount of such Purchaser’s
applicable Purchase Price.

 

(c) The representations
and warranties of each Purchaser shall be true and correct as of
the date when made and at Closing as though made at that time
(except for representations and warranties that speak as of a
specific date, which representations and warranties shall be true
and correct as of such date), and such 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 such Purchaser at or
prior to the Closing.

 

(d) No statute, rule,
regulation, executive order, decree, ruling, injunction, action or
proceeding shall have been enacted, entered, promulgated or
endorsed by 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.

 

6. CONDITIONS TO THE PURCHASER’S
OBLIGATION TO PURCHASE.

 

The
obligation of each Purchaser hereunder to purchase the Shares is
subject to the satisfaction of each of the following conditions,
provided that such conditions are for each Purchaser’s
individual and sole benefit and may be waived by such Purchaser at
any time in such Purchaser’s sole discretion:

 

(a) The Company shall
have executed the Execution Page to this Agreement to which the
Company is a party and delivered executed originals of the same to
such Purchaser.

 

(b) All consents,
approvals and waivers required for the consummation of the
transactions contemplated hereby shall have been
obtained.

 

(c) The Company shall
have delivered to such Purchaser duly executed certificates
representing the Shares, registered in such Purchaser’s name,
or to cause Shares purchased by each Purchaser to be issued in
book-entry form with the Company’s transfer
agent.

 

(d) The Common Stock
shall be authorized for quotation and listed on the OTC:PINK and
trading in the Common Stock (or on the OTC:PINK generally) shall
not have been suspended by the SEC or the OTC:PINK.

 

(e) The representations
and warranties of the Company shall be true and correct as of the
date when made and as of Closing as though made at that time
(except for representations and warranties that speak as of a
specific date, which representations and warranties shall be true
and correct as of such 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
Closing. In connection with the issuance of the Shares upon the
Closing, such Purchaser shall have received a certificate, executed
by the Chief Executive Officer of the Company after reasonable
investigation, dated as of the Closing to the foregoing effect and
as to such other matters as may reasonably be requested by such
Purchaser.

 

 

 

 

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

 

(g) There shall have
been no material adverse changes and no material adverse
developments in the business, properties, operations, prospects,
financial condition or results of operations of the Company and its
Subsidiaries, taken as a whole, since the date hereof, and no
information that is materially adverse to the Company and of which
such Purchaser is not currently aware shall come to the attention
of such Purchaser.

 

(h) Such Purchaser
shall have received a copy of resolutions, duly adopted by the
Board of Directors of the Company, which shall be in full force and
effect at the time of the Closing, authorizing the execution,
delivery and performance by the Company of this Agreement and the
consummation by the Company of the transactions contemplated hereby
and thereby, certified as such by the Secretary or Assistant
Secretary of the Company on or before the Closing, and such other
documents they reasonably request in connection with the issuance
of the Shares upon Closing.

 

7. GOVERNING LAW;
MISCELLANEOUS.

 

(a) Governing Law; Jurisdiction.
This Agreement shall be governed by and construed in accordance
with the laws of the State of California applicable to contracts
made and to be performed in the State of California. The Company
and each Purchaser irrevocably consent to the exclusive
jurisdiction of the United States federal courts and the state
courts located in the County of Orange, State of California, in any
suit or proceeding based on or arising under this Agreement and
irrevocably agree that all claims in respect of such suit or
proceeding may be determined in such courts. The Company and each
Purchaser irrevocably waive the defense of an inconvenient forum to
the maintenance of such suit or proceeding. The Company and each
Purchaser further agree that service of process upon each
respective party mailed by first class mail shall be deemed in
every respect effective service of process upon such party in any
such suit or proceeding. The Company and each Purchaser agree that
a final non-appealable judgment in any such suit or proceeding
shall be conclusive and may be enforced in other jurisdictions by
suit on such judgment or in any other lawful manner.

 

(b) Counterparts. This Agreement
may be executed in two or more counterparts, all of which shall be
considered one and the same agreement and shall become effective
when counterparts have been signed by each party and delivered to
the other party. This Agreement, once executed by a party, may be
delivered to the other parties hereto by facsimile transmission or
electronic mail of a copy of this Agreement bearing the signature
of the party so delivering this Agreement.

 

(c) Construction. Whenever the
context requires, the gender of any word used in this Agreement
includes the masculine, feminine or neuter, and the number of any
word includes the singular or plural. Unless the context otherwise
requires, all references to articles and sections refer to articles
and sections of this Agreement, and all references to schedules are
to schedules attached hereto, each of which is made a part hereof
for all purposes. The descriptive headings of the several articles
and sections of this Agreement are inserted for purposes of
reference only, and shall not affect the meaning or construction of
any of the provisions hereof.

 

(d) Severability. If any provision
of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect
the validity or enforceability of the remainder of this Agreement
or the validity or enforceability of this Agreement in any other
jurisdiction.

 

 

 

 

(e) Entire Agreement; Amendments.
This Agreement and the other Transaction Documents (including any
schedules and exhibits hereto and thereto) contain the entire
understanding of the Purchasers, the Company, their affiliates and
persons acting on their behalf with respect to the matters covered
herein and therein and, except as specifically set forth herein or
therein, neither the Company nor the Purchasers make any
representation, warranty, covenant or undertaking with respect to
such matters. No provision of this Agreement may be waived other
than by an instrument in writing signed by the party to be charged
with enforcement, and no provision of this Agreement may be amended
other than by an instrument in writing signed by the Company and
each Purchaser.

 

(f) Notices. Any notices required
or permitted to be given under the terms of this Agreement shall be
sent by certified or registered mail (return receipt requested) or
delivered personally, by responsible overnight carrier or by
confirmed facsimile, and shall be effective five days after being
placed in the mail, if mailed, or upon receipt or refusal of
receipt, if delivered personally or by responsible overnight
carrier or confirmed facsimile, in each case addressed to a party.
The initial addresses for such communications shall be as follows,
and each party shall provide notice to the other parties of any
change in such party’s address:

 

(i) If to the
Company:

 

Charlie's Holdings,
Inc.

1007
Brioso Drive

Costa
Mesa, CA 92627

Telephone: (949)
531-6855

Attention: Chief
Financial Officer

 

with a
copy simultaneously transmitted by like means (which transmittal
shall not constitute notice hereunder) to:

 

Disclosure Law
Group, a Professional Corporation

655
West Broadway, Suite 870

San
Diego, CA 92101

Telephone: (619)
272-7050

Facsimile: (619)
330-2101

Attention: Jessica
R. Sudweeks, Esq.

 

(ii) If
to any Purchasers, to the address set forth under such
Purchaser’s name on the Execution Page hereto executed by
such Purchaser.

 

(g) Successors and Assigns. This
Agreement shall be binding upon and inure to the benefit of the
parties and their successors and assigns. Except as provided
herein, the Company shall not assign this Agreement or any rights
or obligations hereunder. Any Purchaser may assign or transfer the
Shares pursuant to the terms of this Agreement and of such Shares.
Any Purchaser may assign such Purchaser’s rights hereunder or
thereunder to any other person or entity, except for direct
competitors of the Company or persons or entities that have
publicly announced plans to compete directly with the Company. In
addition, and notwithstanding anything to the contrary contained in
this Agreement, the Shares may be pledged and all rights of any
Purchaser under this Agreement may be assigned, without further
consent of the Company, to a bona fide pledgee in connection with
such Purchaser’s margin or brokerage account.

 

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

 

 

 

 

(i) Survival. The representations
and warranties of the Company and the agreements and covenants set
forth in Sections 2, 3, 4, 6 and 7 hereof shall survive each of the
Investment Dates notwithstanding any due diligence investigation
conducted by or on behalf of any Purchaser. Moreover, none of the
representations and warranties made by the Company herein shall act
as a waiver of any rights or remedies any Purchaser may have under
applicable U.S. federal or state securities laws.

 

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

 

(k) Indemnification. In
consideration of each Purchaser’s execution and delivery of
this Agreement and purchase of the Shares hereunder, and in
addition to all of the Company’s other obligations under this
Agreement, from and after the Closing, the Company shall defend,
protect, indemnify and hold harmless each Purchaser and each other
holder of the Shares and all of their stockholders, partners,
members, officers, directors, employees and direct or indirect
investors and any of the foregoing persons’ agents or other
representatives, including, without limitation, those retained in
connection with the transactions contemplated by this Agreement
(collectively, the “Indemnitees”), from and against
any and all actions, causes of action, suits, claims, losses,
costs, penalties, fees, liabilities and damages, and expenses in
connection therewith (irrespective of whether any such Indemnitee
is a party to the action for which indemnification hereunder is
sought), and including reasonable attorneys’ fees and
disbursements (the “Indemnified Liabilities”),
incurred by any Indemnitee as a result of, or arising out of, or
relating to (i) any misrepresentation or breach of any
representation or warranty made by the Company in this Agreement or
any other certificate, instrument or document contemplated hereby
or thereby, (ii) any breach of any covenant, agreement or
obligation of the Company contained in this Agreement or any other
certificate, instrument or document contemplated hereby or thereby
or (iii) any cause of action, suit or claim brought or made against
such Indemnitee by a third party (including for these purposes a
derivative action brought on behalf of the Company) and arising out
of or resulting from (A) the execution, delivery, performance or
enforcement of this Agreement or any other certificate, instrument
or document contemplated hereby or thereby, (B) any transaction
financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of the issuance and sale of the
Shares, or (C) the status of such Purchaser or holder of the Shares
as an investor in the Company. To the extent that the foregoing
undertaking by the Company may be unenforceable for any reason, the
Company shall make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law.

 

(l) Joint Participation in
Drafting. Each party to this Agreement has participated in
the negotiation and drafting of this Agreement. As such, the
language used herein and therein shall be deemed to be the language
chosen by the parties hereto to express their mutual intent, and no
rule of strict construction will be applied against any party to
this Agreement.

 

(m) Knowledge. As used in this
Agreement, the term “knowledge” of any person or entity
shall mean and include (i) with respect to the Company, the actual
knowledge of any of the Company’s officers or directors and
(ii) that knowledge which a reasonably prudent business person
could have obtained in the management of his or her business
affairs after making due inquiry and exercising due diligence which
a prudent business person should have made or exercised, as
applicable, with respect thereto.

 

 

 

 

(n) Exculpation Among Purchasers.
The Company acknowledges that the obligations of each Purchaser
under this Agreement are several and not joint with the obligations
of any other Purchaser, and no Purchaser shall be responsible in
any way for the performance of the obligations of any other
Purchaser under this Agreement. Each Purchaser acknowledges that it
has independently evaluated the merits of the transactions
contemplated by this Agreement, that it has independently
determined to enter into the transactions contemplated hereby and
thereby, that it is not relying on any advice from or evaluation by
any other Purchaser, and that it is not acting in concert with any
other Purchaser in making its purchase of securities hereunder or
in monitoring its investment in the Company. The Purchasers and, to
its knowledge, the Company agree that the no action taken by any
Purchaser pursuant hereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Purchasers
are in any way acting in concert or would deem such Purchasers to
be members of a “group” for purposes of Section 13(d)
of the Exchange Act, and the Purchasers have not agreed to act
together for the purpose of acquiring, holding, voting or disposing
of equity securities of the Company. The Company has elected to
provide all Purchasers with the same terms documentation for the
convenience of the Company and not because it was required or
requested to do so by the Purchasers. The Company acknowledges that
such procedure with respect to this Agreement in no way creates a
presumption that the Purchasers are in any way acting in concert or
as a “group” for purposes of Section 13(d) of the
Exchange Act with respect to this Agreement or the transactions
contemplated hereby. Each Purchaser acknowledges that it has been
represented by its own separate legal counsel in their review and
negotiation of this Agreement.

 

(o) Business Days and Trading Days.
For purposes of this Agreement, the term “business day”
means any day other than a Saturday or Sunday or a day on which
banking institutions in the State of New York are authorized or
obligated by law, regulation or executive order to close, and the
term “trading day” means any day on which the OTC:PINK
or, if the Common Stock is not then traded on the OTC:PINK, the
principal national securities exchange, automated quotation system
or other trading market where the Common Stock is then listed,
quoted or traded, is open for trading.

 

 

[REMAINDER
OF PAGE LEFT BLANK INTENTIONALLY]

 

 

 

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

 

 

CHARLIE'S HOLDINGS, INC.

 

By:                                                                            

Name:

Title:

 

 

PURCHASER:

 

(Print
or Type Name of Purchaser)

 

By:                                                                            

Name:

Title:

 

ADDRESS:                      

 

Telephone:                                                      

Facsimile:                                                      

Attention:                                                      

 

AGGREGATE
SUBSCRIPTION AMOUNT:

 

Number of
Shares:                                                                                      

Purchase Price
($0.0853 per Share):EX-4.1

 Exhibit 4.1 

[Form of Note] 
 (FACE
OF NOTE) 
 THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM IN ACCORDANCE WITH THE PROVISIONS OF THE INDENTURE AND THE TERMS OF THE SECURITIES, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITORY. 
 UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
(“DTC”), TO AT&T INC., OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
 AT&T INC. 

0.900% Global Notes due 2024 

CUSIP NO. [●] 
 ISIN NO.
[●] 
 No. R-[●] 

$500,000,000 
 AT&T Inc., a
corporation duly organized and existing under the laws of the State of Delaware (herein called “AT&T”, which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to
Cede & Co., or registered assigns, the principal sum of Five Hundred Million Dollars ($500,000,000) on March 25, 2024 (the “Maturity Date”), and to pay interest on said principal sum from March 23, 2021 or from the most
recent Interest Payment Date to which interest has been paid or duly provided for, semiannually in arrears on March 25 and September 25 in each year, commencing on September 25, 2021 (each an “Interest Payment Date”) and on
the Maturity Date, at the interest rate of 0.900% per annum, until the principal hereof is paid or made available for payment. The interest so payable, and punctually paid or duly 

 
provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of
business on the Regular Record Date for such interest, which shall be the close of business on the fifteenth day preceding the respective Interest Payment Date (each, a “Regular Record Date”). Any such interest not so punctually paid or
duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on a special record
date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Notes not less than 15 days prior to such special record date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. 

Any money that AT&T deposits with the Trustee or its Paying Agent for the payment of principal or any interest on this Note that remains
unclaimed for two years after the date upon which the principal and interest are due and payable, will be repaid to AT&T upon AT&T’s request unless otherwise required by mandatory provisions of any applicable unclaimed property law.
After that time, unless otherwise required by mandatory provisions of any unclaimed property law, the Holder of this Note will be able to seek any payment to which such Holder may be entitled to collect only from AT&T. 

If the Notes are issued in definitive form, payment of the principal and interest on this Note due at the Maturity Date or upon redemption
will be made at the Maturity Date or upon redemption, as the case may be, upon presentation of this Note, in immediately available funds, at the office of The Bank of New York Mellon Trust Company, N.A., the Paying and Transfer Agent and Registrar
for the Notes, currently located at 601 Travis Street, 16th Floor, Houston, Texas 77002. 
 Payment of interest on this Note due on an
Interest Payment Date, other than interest at maturity or upon redemption, may be paid by check mailed to the address of the Holder entitled thereto as such address shall appear in the Note register. Notwithstanding the foregoing, (1) the
Depository as Holder of the Notes or (2) a Holder of more than U.S.$5,000,000 in aggregate principal amount of Notes in definitive form is entitled to require the Paying Agent to make payments of interest, other than interest due at maturity or
upon redemption, by wire transfer of immediately available funds into an account maintained by the Holder in the United States, by sending appropriate wire transfer instructions as long as the Paying Agent receives the instructions not less than ten
days prior to the applicable Interest Payment Date. 
 Reference is hereby made to the further provisions of this Note set forth on the
reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. 

  
 2 

 Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual or electronic signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 

  
 3 

 IN WITNESS WHEREOF, AT&T INC. has caused this instrument to be signed in its corporate
name, manually or by facsimile, by its duly authorized officers and has caused its corporate seal to be imprinted hereon. 
  

							
	Dated: March 23, 2021	 		 	AT&T INC.
				
	[SEAL]	 		 		 	
				
		 		 	By:	 	  

		 		 		 	 George B. Goeke
 Senior Vice President
and Treasurer

				
		 		 	By:	 	  

		 		 		 	 Jeston B. Dumas
 Vice President and
Assistant Treasurer

 Trustee’s Certificate of Authentication 

This is one of the 0.900% Global Notes due 2024 
 of the series
designated herein referred to 
 in the within-mentioned Indenture. 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., 
 as Trustee

  

							
	By:	 	  
	 		 	Dated: March 23, 2021
		 	Authorized Signatory	 		 	

 REVERSE OF NOTE 

This Note is one of a duly authorized issue of debt securities of AT&T of the series specified on the face hereof, issued under and
pursuant to an Indenture, dated as of May 15, 2013, between AT&T and The Bank of New York Mellon Trust Company, N.A., as Trustee (the “Trustee,” which term includes any successor Trustee under the Indenture), to which
indenture and all indentures supplemental thereto (collectively, the “Indenture”) reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, AT&T and
the Holders of the Notes and of the terms upon which the Notes are, and are to be, authenticated and delivered. The Notes will be issued in fully registered form only and in minimum denominations of $2,000 and integral multiples of $1,000
thereafter. This Note is one of the series designated on the face hereof initially limited in aggregate principal amount to $2,250,000,000. 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations
of AT&T and the rights of the Holders of the Notes under the Indenture at any time by AT&T and the Trustee with the consent of the Holders of a majority in principal amount of the Notes at the time outstanding. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount of the Notes at the time outstanding to waive compliance by AT&T with certain provisions of the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange herefor or
in lieu hereof, whether or not notation of such consent or waiver is made upon this Note. 
 No reference herein to the Indenture and no
provision of this Note or of the Indenture shall alter or impair the obligation of AT&T, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate, and in the coin or currency, herein
prescribed. 
 Registrar and Paying Agent 

AT&T shall maintain in the Borough of Manhattan, The City of New York, an office or agency where Notes may be surrendered for registration
of transfer or exchange (“Registrar”) and an office or agency where Notes may be presented for payment or for exchange (“Paying Agent”). AT&T has initially appointed the Trustee, The Bank of New York Mellon Trust
Company, N.A., as its Registrar and Paying Agent. AT&T may vary or terminate the appointment of any of its paying or transfer agencies, and may appoint additional paying or transfer agencies. 

Optional Redemption by AT&T 

The Notes may be redeemed at any time prior to March 25, 2022, as a whole or in part, at AT&T’s option, at any time and from time
to time on at least 10 days’, but not more than 40 days’, prior notice mailed (or otherwise transmitted in accordance with DTC procedures) to the registered address 

 
of each Holder of the Notes. The redemption price will be calculated by AT&T and will be equal to the greater of (i) 100% of the principal amount of the Notes to be redeemed or (ii) the
sum of the present values of the Remaining Scheduled Payments (as defined below) discounted to the redemption date, on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months), at a rate equal to the sum of the Treasury Rate (as defined below) plus 10 basis points. The Notes may be redeemed at any time on or after March 25, 2022, as a whole or in part, at
AT&T’s option, at any time and from time to time on at least 10 days’, but not more than 40 days’, prior notice mailed (or otherwise transmitted in accordance with DTC procedures) to the registered address of each Holder of the
Notes at a redemption price equal to 100% of the principal amount of the Notes to be redeemed. AT&T will calculate the redemption price. In each case, accrued but unpaid interest will be payable to the redemption date. 

“Treasury Rate” means, with respect to any redemption date for the Notes, the rate per annum equal to the semiannual equivalent
yield to maturity or interpolation (on a day count basis) of the interpolated Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price
for such redemption date, as determined by AT&T or an Independent Investment Banker appointed by AT&T. 
 “Comparable Treasury
Issue” means the United States Treasury security or securities selected by an Independent Investment Banker as having an actual or interpolated maturity comparable to the remaining term of the Notes to be redeemed that would be utilized, at the
time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of a comparable maturity to the remaining term of such Notes. 

“Independent Investment Banker” means one of the Reference Treasury Dealers, appointed by AT&T. 

“Comparable Treasury Price” means, with respect to any redemption date, (1) the average of the Reference Treasury Dealer
Quotations for such redemption date after excluding the highest and lowest of such Reference Treasury Dealer Quotations, or (2) if AT&T obtains fewer than three such Reference Treasury Dealer Quotations, the average of all such quotations.

 “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the
average, as determined by AT&T, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to AT&T by such Reference Treasury Dealer at 3:30 p.m., New York
City time, on the third Business Day preceding such redemption date. 
 “Reference Treasury Dealer” means each of Barclays Capital
Inc., Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Mizuho Securities USA LLC and their respective affiliates and, at the option of AT&T, one other nationally recognized investment banking firm

  
 2 

 
that is a primary U.S. Government Securities dealer in the United States (each, a “Primary Treasury Dealer”); provided, however, that if any of the foregoing shall cease to be a Primary
Treasury Dealer, AT&T will substitute therefor another Primary Treasury Dealer.  
 “Remaining Scheduled Payments”
means, with respect to each Note to be redeemed, the remaining scheduled payments of principal and interest on the Note that would be due after the related redemption date through the par call date for the Notes but for the redemption, assuming the
Notes matured on the par call date (not including any portion of payments of interest accrued as of the redemption date). If that redemption date is not an Interest Payment Date with respect to the Note, the amount of the next succeeding scheduled
interest payment on the Note will be reduced by the amount of interest accrued on the Note to the redemption date. 
 On and after the
redemption date, interest will cease to accrue on the Notes or any portion of the Notes called for redemption, unless AT&T defaults in the payment of the redemption price and accrued interest. On or before the redemption date, AT&T will
deposit with its Paying Agent or the Trustee money sufficient to pay the redemption price of and accrued interest on the Notes to be redeemed on that date. 

Any redemption or notice may, at the discretion of AT&T, be subject to one or more conditions precedent and, at the discretion of
AT&T, the redemption date may be delayed until such time as any or all such conditions precedent included at the discretion of AT&T shall be satisfied (or waived by AT&T) or the redemption date may not occur and such notice may be
rescinded if all such conditions precedent included at the discretion of AT&T shall not have been satisfied (or waived by AT&T). 

In the case of any partial redemption, selection of the Notes to be redeemed will be made in accordance with applicable procedures of DTC.

 Payment of Additional Amounts 

AT&T will, subject to the exceptions and limitations set forth below, pay as additional interest on this Note such additional amounts
(“Additional Amounts”) as are necessary so that the net payment by AT&T or its Paying Agent of the principal of and interest on this Note to a person that is a United States Alien, after deduction for any present or future tax,
assessment or governmental charge of the United States or a political subdivision or taxing authority thereof or therein, imposed by withholding with respect to the payment, will not be less than the amount that would have been payable in respect of
this Note had no withholding or deduction been required. As used herein, “United States Alien” means any person who, for United States federal income tax purposes, is a foreign corporation, a
non-resident alien individual, a non-resident alien fiduciary of a foreign estate or trust, or a foreign partnership one or more of the members of which is, for United
States federal income tax purposes, a foreign corporation, a non-resident alien individual or a non-resident alien fiduciary of a foreign estate or trust. 

  
 3 

 The foregoing obligation to pay Additional Amounts shall not apply: 

(1)    to any tax, assessment or governmental charge that is imposed or withheld solely because the
beneficial owner, or a fiduciary, settlor, beneficiary or member of the beneficial owner if the beneficial owner is an estate, trust or partnership, or a person holding a power over an estate or trust administered by a fiduciary holder: 

(a)    is or was present or engaged in a trade or business in the United States, has or had a permanent
establishment in the United States, or has any other present or former connection with the United States or any political subdivision or taxing authority thereof or therein; 

(b)    is or was a citizen or resident or is or was treated as a resident of the United States; 

(c)    is or was a foreign or domestic personal holding company, a passive foreign investment company or a
controlled foreign corporation with respect to the United States or is or was a corporation that has accumulated earnings to avoid United States federal income tax; 

(d)    is or was a bank receiving interest described in Section 881(c)(3)(A) of the Internal Revenue
Code of 1986, as amended (the “Code”); or 
 (e)    is or was an actual or constructive
owner of 10% or more of the total combined voting power of all classes of stock of AT&T entitled to vote; 

(2)    to any Holder that is not the sole beneficial owner of the Notes, or a portion thereof, or that is a
fiduciary or partnership, but only to the extent that the beneficial owner, a beneficiary or settlor with respect to the fiduciary, or a member of the partnership would not have been entitled to the payment of an Additional Amount had such
beneficial owner, beneficiary, settlor or member received directly its beneficial or distributive share of the payment; 

(3)    to any tax, assessment or governmental charge that is imposed or withheld solely because the
beneficial owner or any other person failed to comply with certification, identification or information reporting requirements concerning the nationality, residence, identity or connection with the United States of the Holder or beneficial owner of
the Notes, if compliance is required by statute, by regulation of the United States Treasury Department or by an applicable income tax treaty to which the United States is a party as a precondition to exemption from such tax, assessment or other
governmental charge; 
 (4)    to any tax, assessment or governmental charge that is imposed other than
by deduction or withholding by AT&T or a paying agent from the payment; 

  
 4 

 (5)    to any tax, assessment or governmental charge
that is imposed or withheld solely because of a change in law, regulation, or administrative or judicial interpretation that is announced or becomes effective after the day on which the payment becomes due or is duly provided for, whichever occurs
later; 
 (6)    to an estate, inheritance, gift, sales, excise, transfer, wealth or personal property
tax or any similar tax, assessment or governmental charge; 
 (7)    to any tax, assessment or other
governmental charge any paying agent (which term may include AT&T) must withhold from any payment of principal of or interest on any Note, if such payment can be made without such withholding by any other paying agent; or 

(8)    in the case of any combination of the above items. 

In addition, any amounts to be paid on this Note will be paid net of any deduction or withholding imposed or required pursuant to Sections
1471 through 1474 of the Code, any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b) of the Code, or any fiscal or regulatory legislation, rules or practices adopted
pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code, and no Additional Amounts will be required to be paid on account of any such deduction or withholding. 

The Notes are subject in all cases to any tax, fiscal or other law or regulation or administrative or judicial interpretation applicable.
Except as specifically provided under this section entitled “Payment of Additional Amounts” and under the heading “Redemption Upon a Tax Event”, AT&T shall not have to make any payment with respect to any tax, assessment or
governmental charge imposed by any government or a political subdivision or taxing authority. 
 Any reference in the terms of the Notes to
any amounts in respect of the Notes shall be deemed also to refer to any Additional Amounts which may be payable under this provision. 

Redemption Upon a Tax Event 

If (a) AT&T becomes or will become obligated to pay Additional Amounts as a result of any change in, or amendment to, the laws (or any
regulations or rulings promulgated thereunder) of the United States (or any political subdivision or taxing authority thereof or therein), or any change in, or amendments to, any official position regarding the application or interpretation of such
laws, regulations or rulings, which change or amendment is announced or becomes effective, on or after March 19, 2021 or (b) a taxing authority of the United States takes an action on or after March 19, 2021, whether or not with
respect to AT&T or any of its affiliates, that results in a substantial probability that AT&T will or may be required to pay such Additional Amounts, then AT&T may, at its option, redeem, as a whole, but not in part, the Notes on any
Interest Payment Date on not less than 10 nor more than 40 calendar days’ prior notice, at a redemption price equal to 100% of their principal amount, together with interest accrued thereon 

  
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to the date fixed for redemption. No redemption pursuant to (b) above may be made unless AT&T shall have received an opinion of independent counsel to the effect that an act taken by a
taxing authority of the United States results in a substantial probability that AT&T will or may be required to pay the Additional Amounts and AT&T shall have delivered to the Trustee a certificate, signed by a duly authorized officer,
stating that based on such opinion, AT&T is entitled to redeem the Notes pursuant to their terms. 
 Further Issues 

AT&T reserves the right from time to time, without notice to or the consent of the Holders of the Notes, to create and issue further notes
ranking equally and ratably with the Notes in all respects, or in all respects except for the payment of interest accruing prior to the issue date or except for the first payment of interest following the issue date of those further notes. Any
further notes will have the same terms as to status, redemption or otherwise as, and will be fungible for United States federal income tax purposes with, the Notes. Any further notes shall be issued pursuant to a resolution of the board of directors
of AT&T, a supplement to the Indenture, or under an officers’ certificate pursuant to the Indenture. 
 Notes in Definitive Form

 If (1) an Event of Default has occurred with regard to the Notes represented by this Note and has not been cured or waived in
accordance with the Indenture, or (2) the Depository is at any time unwilling or unable to continue as depository and a successor depository is not appointed by AT&T within 90 days, AT&T may issue notes in definitive form in exchange
for this Note. In either instance, an owner of a beneficial interest in the Notes will be entitled to the physical delivery in definitive form in exchange for this Note, equal in principal amount to such beneficial interest and to have such Notes
registered in its name. 
 Notes so issued in definitive form will be issued as registered notes in minimum denominations of $2,000 and
integral multiples of $1,000 thereafter, unless otherwise specified by AT&T. 
 Notes so issued in definitive form may be transferred by
presentation for registration to the Registrar at its New York office and must be duly endorsed by the Holder or the Holder’s attorney duly authorized in writing, or accompanied by a written instrument or instruments of transfer in form
satisfactory to AT&T or the Trustee duly executed by the Holder or his attorney duly authorized in writing. 
 AT&T may require
payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any exchange or registration of transfer of definitive Notes. 

  
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 Default 

In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal hereof may be declared, and upon
such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. 

Miscellaneous 
 For
purposes of the Notes, a Business Day means a business day in The City of New York. 
 No director, officer, employee or stockholder, as
such, of AT&T shall have any liability for any obligations of AT&T under this Note, the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Holder by accepting this Note waives and
releases all such liability. The waiver and release are part of the consideration for the issue of this Note. 
 The Notes are the unsecured
and unsubordinated obligations of AT&T and will rank pari passu with all other evidences of indebtedness issued in accordance with the Indenture. 

Notices to Holders of the Notes will be given only to the depositary, in accordance with its applicable policies as in effect from time to
time. 
 Prior to due presentment of this Note for registration of transfer, AT&T, the Trustee and any agent of AT&T or the Trustee
may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither AT&T, the Trustee nor any such agent shall be affected by notice to the contrary. 

All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.  

The Indenture and this Note shall be governed by and construed in accordance with the laws of the State of New York. 

  
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