Document:

THIS
WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT
UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO INCEPTION MINING INC.
THAT SUCH REGISTRATION IS NOT REQUIRED.

 

Right
to Purchase Shares of Common Stock of Inception Mining Inc.

 

COMMON
STOCK PURCHASE WARRANT

 

	Warrant
    Shares: 100,000	Issue
    Date: March 8, 2017

 

Inception
Mining Inc., a corporation organized under the laws of the State of Nevada, hereby certifies that, for value received, Labrys
Fund, LP or its assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from
the Company (as defined herein) at any time after the Issue Date set forth above for two years following the Issue Date, one hundred
thousand (100,000) fully paid and non-assessable shares of Common Stock (as hereinafter defined) at the applicable Exercise Price
per share (as defined below) (the “Warrants”). The Warrants are being issued to the Holder in connection with the
Company’s issuance of that certain convertible promissory note in the principal amount of $110,000.00 (the “Note”)
to the Holder.

 

As
used herein the following terms, unless the context otherwise requires, have the following respective meanings:

 

(a)
The term “Common Stock” includes (i) the Company’s common stock, par value $0.00001; and (ii) any other securities
into which or for which any of the securities described in the preceding clause may be converted or exchanged pursuant to a plan
of recapitalization, reorganization, merger, sale of assets or otherwise.

 

(b)
The term “Company” shall include Inception Mining Inc., a Nevada corporation, and any person or entity which shall
succeed, or assume the obligations of, Inception Mining Inc. hereunder.

 

(c)
The “Exercise Price” applicable under this Warrant shall be the price at which the Holder purchases shares of Common
Stock, or $0.75 per share.

 

	 	1.	Exercise
    of Warrant.

 

1.1.
Number of Shares Issuable upon Exercise. From and after the date hereof, the Holder shall be entitled to receive, upon
exercise of this Warrant in whole or in part, by delivery of an original or fax copy of an exercise notice in the form attached
hereto as Exhibit A (the “Exercise Notice”) along with payment of the Exercise Price per share, shares of Common
Stock of the Company so long as shares of Common Stock of the Company are available for issuance. All shares of the Common Stock
are immediately exercisable upon the execution of this Warrant at the Exercise Price of $0.75 per share.

 

1.2.
Company Acknowledgment. The Company will, at the time of the exercise of this Warrant, upon the request of the Holder hereof
acknowledge in writing its continuing obligation to afford to such Holder any rights to which such Holder shall continue to be
entitled after such exercise in accordance with the provisions of this Warrant. If the Holder shall fail to make any such request,
such failure shall not affect the continuing obligation of the Company to afford to such Holder any such rights.

 

    	 		 

     

    

 

1.3.
Trustee for Warrant Holders. In the event that a bank or trust company shall have been appointed as trustee for the Holder
of this Warrant, such bank or trust company shall have all the powers and duties of a warrant agent (as described in Section 6
herein) and shall accept, in its own name for the account of the Company or such successor person as may be entitled thereto,
all amounts otherwise payable to the Company or such successor, as the case may be, on exercise of this Warrant pursuant to this
Section 1.

 

	 	2.	Procedure
    for Exercise.

 

2.1.
Delivery of Stock Certificates, Etc., on Exercise. The Company agrees that the shares of Common Stock purchased upon exercise
of this Warrant shall be deemed to be issued to the Holder as the record owner of such shares as of the close of business on the
date on which this Warrant shall have been surrendered and payment made for such shares in accordance herewith. Within two (2)
business days after the exercise of this Warrant in full or in part, the Company, at the Company’s expense, will cause to
be issued in the name of and delivered to the Holder, or as such Holder (upon payment by such Holder of any applicable transfer
taxes) may direct in compliance with applicable securities laws, a certificate or certificates for the number of duly and validly
issued, fully paid and non-assessable shares of Common Stock to which such Holder shall be entitled on such exercise.

 

2.2.
Exercise. Payment may be made in cash by wire transfer of immediately available funds or by certified or official bank
check payable to the order of the Company equal to the applicable aggregate Exercise Price, for the number of Common Shares specified
in the Exercise Notice and the Holder shall thereupon be entitled to receive the number of duly authorized, validly issued, fully-paid
and non-assessable shares of Common Stock as provided herein.

 

3.
Assignment; Exchange of Warrant. Subject to compliance with applicable securities laws, this Warrant, and the rights evidenced
hereby, may be transferred by any registered holder hereof (a “Transferor”) in whole or in part. On the surrender
for exchange of this Warrant, with the Transferor’s endorsement in the form of Exhibit B attached hereto (the “Transferor
Endorsement Form”) and together with evidence reasonably satisfactory to the Company demonstrating compliance with applicable
securities laws, which shall include, without limitation, the provision of a legal opinion from the Transferor’s counsel
(at the Company’s expense) that such transfer is exempt from the registration requirements of applicable securities laws,
the Company at its expense (but with payment by the Transferor of any applicable transfer taxes) will issue and deliver to or
on the order of the Transferor thereof a new Warrant of like tenor, in the name of the Transferor and/or the transferee(s) specified
in such Transferor Endorsement Form (each a “Transferee”), calling in the aggregate on the face or faces thereof
for the number of shares of Common Stock called for on the face or faces of the Warrant so surrendered by the Transferor.

 

4.
Replacement of Warrant. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant and, in the case of any such loss, theft or destruction of this Warrant, on delivery of an indemnity
agreement or security reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, on surrender
and cancellation of this Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like
tenor.

 

    	 	2	 

    	 		 

    

 

5.
Maximum Exercise. Notwithstanding anything herein to the contrary, in no event shall the Holder be entitled to exercise
any portion of this Warrant in excess of that portion of this Warrant upon exercise of which the sum of (a) the number of shares
of Common Stock beneficially owned by the Holder and its Affiliates and (b) the number of shares of Common Stock issuable upon
the exercise of the portion of this Warrant with respect to which the determination of this limitation is being made, would result
in beneficial ownership by the Holder and its Affiliates of any amount greater than 4.99% of the then outstanding shares of Common
Stock (which shall automatically be increased to 9.99% if the beneficial ownership limitations contained in the Note are increased
to 9.99% pursuant to the terms therein). As used herein, the term “Affiliate” means any person or entity that, directly
or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a person or entity,
as such terms are used in and construed under Rule 144 under the Securities Act. For purposes of the second preceding sentence,
beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended,
and Regulations 13(d)-(g) thereunder. The limitations set forth herein may be waived in whole or in part, upon sixty-one (61)
days prior written notice from the Holder to the Company.

 

6.
Warrant Agent. The Company may, by written notice to the Holder of the Warrant, appoint an agent for the purpose of issuing
Common Stock on the exercise of this Warrant, exchanging this Warrant, and replacing this Warrant, or any of the foregoing, and
thereafter any such issuance, exchange or replacement, as the case may be, shall be made at such office by such agent.

 

7.
Transfer on the Company’s Books. Until this Warrant is transferred on the books of the Company, the Company may treat
the registered Holder hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary.

 

8.
Miscellaneous. This Warrant and any term hereof shall be governed by and construed in accordance with the laws of the State
of Nevada without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the
transactions contemplated by this Warrant shall be brought only in the state courts or federal courts located in the Commonwealth
of Massachusetts. The parties to this Warrant hereby irrevocably waive any objection to jurisdiction and venue of any action instituted
hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY
DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT ENTERED INTO IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, ANY
OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY. 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 Warrant or any other
agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such
provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with
such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity
or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and
consents to process being served in any suit, action or proceeding in connection with this Agreement or any other Transaction
Document by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such
party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any other manner permitted by law.

 

    	 	3	 

    	 		 

    

 

IN
WITNESS WHEREOF, the Company has executed this Warrant as of the date first written above.

 

	 	INCEPTION MINING INC.
	 	By:
    	 
	 	Name:
    	Trent
    D’Ambrosio
	 	Title:	Chief
    Executive Officer

 

    	 	4	 

    	 		 

    

 

EXHIBIT
A

 

FORM
OF SUBSCRIPTION

(To
Be Signed Only on Exercise of Warrant)

 

	TO:	Inception
    Mining Inc.
	 	5330
    South 900 East, Suite 280
	 	Murray,
    Utah 84117
	 	Attention:
    Chief Financial Officer

 

The
undersigned, pursuant to the provisions set forth in the attached Warrant, hereby irrevocably elects to purchase (check applicable
box):

 

	 	 	________
    shares of the Common Stock covered by such Warrant; or

 

The
undersigned herewith makes payment of the full Exercise Price for such shares at the price per share provided for in such Warrant,
which is $0.75 per share. Such payment takes the form of:

 

	 	 	$__________
    in lawful money of the United States; and/or

 

The
undersigned requests that the certificates for such shares be issued in the name of, and delivered to ______________________________________________,
whose address is ___________________________________________________________________________.

 

The
undersigned represents and warrants that all offers and sales by the undersigned of the securities issuable upon exercise of the
within Warrant shall be made pursuant to registration of the Common Stock under the Securities Act of 1933, as amended (the “Securities
Act”) or pursuant to an exemption from registration under the Securities Act.

 

	Dated:	 	 	 
	 	 	 	(Signature
    must conform to name of holder as specified on the face of the Warrant)
	 	 	 	 
	 	 	 	Address:
	 	 	 	 
	 	 	 	 
	 	 	 	 

 

    	 		 

     

    

 

EXHIBIT
B

FORM
OF TRANSFEROR ENDORSEMENT

(To
Be Signed Only On Transfer Of Warrant)

 

For
value received, the undersigned hereby sells, assigns, and transfers unto the person(s) named below under the heading “Transferees”
the right represented by the within Warrant to purchase the percentage and number of shares of Common Stock of Inception Mining
Inc., into which the within Warrant relates specified under the headings “Percentage Transferred” and “Number
Transferred,” respectively, opposite the name(s) of such person(s) and appoints each such person Attorney to transfer its
respective right on the books of Inception Mining Inc. with full power of substitution in the premises.

 

	Transferees	 	Address	 	Percentage
    Transferred	 	Number
    

    Transferred
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 

 

	Dated:	 	 	 
	 	 	 	(Signature
    must conform to name of holder as specified on the face of the Warrant)
	 	 	 	 
	 	 	 	Address:
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	SIGNED
    IN THE PRESENCE OF:
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	(Name)
	ACCEPTED
        AND AGREED:

        [TRANSFEREE]
	 	 
	 	 	 
	 	 	 
	(Name)NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN
A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO 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.

 

	Principal
    Amount: US$110,000.00	Issue
    Date: March 8, 2017

 

CONVERTIBLE
PROMISSORY NOTE

 

FOR
VALUE RECEIVED, INCEPTION MINING INC., a Nevada corporation (hereinafter called the “Borrower” or “Company”),
hereby promises to pay to the order of LABRYS FUND, LP, a Delaware limited partnership, or registered assigns (the “Holder”)
the sum of US$110,000.00, together with any interest as set forth herein, on September 8, 2017 (the “Maturity Date”),
and to pay interest on the unpaid principal balance hereof at the rate of twelve percent (12%) (the “Interest Rate”)
per annum from the date hereof (the “Issue Date”) until the same becomes due and payable, whether at maturity or upon
acceleration or by prepayment or otherwise. In connection with the issuance of this convertible promissory note (the “Note”),
the Borrower shall, on the Issue Date, issue 127,910 shares of common stock (the “Returnable Shares”) to Holder as
a commitment fee, provided, however, the Returnable Shares shall be held by a third party escrow agent, and must
be returned to the Borrower’s treasury for cancellation (with all relevant documentation to effectuate such cancellation,
including a medallion-guaranteed stock power) if the Note is fully repaid and satisfied prior to the date which is one hundred
eighty (180) days following the Issue Date, subject further to the terms and conditions of this Note.

 

This
Note may not be prepaid in whole or in part except as otherwise explicitly set forth herein. Any amount of principal or interest
on this Note which is not paid when due shall bear interest at the rate of twenty-four percent (24%) per annum from the due date
thereof until the same is paid (the “Default Interest”). Interest shall commence accruing on the date that the Note
is fully paid and shall be computed on the basis of a 365-day year and the actual number of days elapsed. All payments due hereunder
(to the extent not converted into common stock, $0.00001 par value per share (the “Common Stock”) in accordance with
the terms hereof) shall be made in lawful money of the United States of America.

 

    	 

    	 

    

 

All
payments shall be made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance
with the provisions of this Note. Whenever any amount expressed to be due by the terms of this Note is due on any day which is
not a business day, the same shall instead be due on the next succeeding day which is a business day and, in the case of any interest
payment date which is not the date on which this Note is paid in full, the extension of the due date thereof shall not be taken
into account for purposes of determining the amount of interest due on such date. As used in this Note, the term “business
day” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the city of New York, New York
are authorized or required by law or executive order to remain closed. Each capitalized term used herein, and not otherwise defined,
shall have the meaning ascribed thereto in that certain Securities Purchase Agreement dated the date hereof, pursuant to which
this Note was originally issued (the “Purchase Agreement”).

 

This
Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive
rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.

 

The
following terms shall apply to this Note:

 

Article
I. CONVERSION RIGHTS

 

1.1
Conversion Right. The Holder shall have the right, in its sole and absolute discretion, from time to time, and at any time
on or following the date that an Event of Default (as defined in this Note) occurs under this Note and ending on the later of
(i) the Maturity Date and (ii) the date of payment of the Default Amount (as defined in Article III) pursuant to Section 1.6(a)
or Article III, each in respect of the remaining outstanding principal amount of this Note to convert all or any part of the outstanding
and unpaid principal amount of this Note into fully paid and non-assessable shares of Common Stock, as such Common Stock exists
on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter
be changed or reclassified at the Conversion Price (as defined below) or the Default Conversion Price (as defined below) determined
as provided herein (a “Conversion”); provided, however, that in no event shall the Holder be entitled
to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number
of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be
deemed beneficially owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted portion
of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained
herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to
which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of
more than 4.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence,
beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso, provided,
further, however, that the limitations on conversion may be waived by the Holder (up to a maximum of 9.99%) upon,
at the election of the Holder, not less than 61 days’ prior notice to the Borrower, and the provisions of the conversion
limitation shall continue to apply until such 61st day (or such later date, as determined by the Holder, as may be specified in
such notice of waiver). The number of shares of Common Stock to be issued upon each conversion of this Note shall be determined
by dividing the Conversion Amount (as defined below) by the applicable Default Conversion Price then in effect on the date specified
in the notice of conversion, in the form attached hereto as Exhibit A (the “Notice of Conversion”), delivered to the
Borrower by the Holder in accordance with Section 1.4 below; provided that the Notice of Conversion is submitted by facsimile
or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower before 11:59 p.m., New
York, New York time on such conversion date (the “Conversion Date”).

 

    	 

    	 

    

 

The
term “Conversion Amount” means, with respect to any conversion of this Note, the sum of (1) the principal amount of
this Note to be converted in such conversion, plus (2) at the Holder’s option, accrued and unpaid interest, if any,
on such principal amount at the interest rates provided in this Note to the Conversion Date, provided however, that the Borrower
shall have the right to pay any or all interest in cash, plus (3) at the Holder’s option, Default Interest, if any,
on the amounts referred to in the immediately preceding clauses (1) and/or (2), plus (4) any Additional Principal for such
Conversions, plus (5) at the Holder’s option, any amounts owed to the Holder pursuant to any other provision of this Note,
all subject to the 4.99% (or up to 9.99% if increased as provided above) limitation discussed above.

 

1.2
Conversion Price.

 

(a)
Calculation of Conversion Price. The “Conversion Price” shall be $0.30.

 

(b)
Calculation of Default Conversion Price. If an Event of Default (as defined herein) occurs, subject to the adjustments
described herein, then the Holder shall be entitled to utilize the default conversion price (the “Default Conversion Price”)
, which shall equal the lesser of (i) 55% multiplied by the lowest Trading Price (as defined below) (representing a discount rate
of 45%) during the previous thirty (30) Trading Day period ending on the latest complete Trading Day prior to the date of this
Note and (ii) the Alternate Conversion Price (as defined herein)(subject to equitable adjustments for stock splits, stock dividends
or rights offerings by the Borrower relating to the Borrower’s securities or the securities of any subsidiary of the Borrower,
combinations, recapitalization, reclassifications, extraordinary distributions and similar events). The “Alternate Conversion
Price” shall mean 55% multiplied by the Market Price (as defined herein) (representing a discount rate of 45%). “Market
Price” means the lowest Trading Price (as defined below) for the Common Stock during the thirty (30) Trading Day period
ending on the latest complete Trading Day prior to the Conversion Date. “Trading Price” means, for any security as
of any date, the lesser of: (i) the lowest trade price on the OTC Pink, OTCQB, or applicable trading market (the “OTC Market”)
as reported by a reliable reporting service (“Reporting Service”) designated by the Holder or, if the OTC Market is
not the principal trading market for such security, the trading price of such security on the principal securities exchange or
trading market where such security is listed or traded or, if no trading price of such security is available in any of the foregoing
manners, the average of the trading prices of any market makers for such security that are listed in the “pink sheets”
by the National Quotation Bureau, Inc., or (ii) the lowest closing bid price on the OTC Market as reported by a Reporting Service
designated by the Holder or, if the OTC Market is not the principal trading market for such security, the closing bid price of
such security on the principal securities exchange or trading market where such security is listed or traded or, if no closing
bid price of such security is available in any of the foregoing manners, the average of the closing bid prices of any market makers
for such security that are listed in the “pink sheets” by the National Quotation Bureau, Inc. If the Trading Price
cannot be calculated for such security on such date in the manner provided above, the Trading Price shall be the fair market value
as mutually determined by the Borrower and the holders of a majority in interest of the Notes being converted for which the calculation
of the Trading Price is required in order to determine the Default Conversion Price of such Notes. “Trading Day” shall
mean any day on which the Common Stock is tradable for any period on the OTC Market or on the principal securities exchange or
other securities market on which the Common Stock is then being traded. The Borrower shall be responsible for the fees of its
transfer agent and all DTC fees associated with any such issuance.

 

    	 

    	 

    

 

(b)
Adjustment to Default Conversion Price. At any time after the Issue Date, (i) if in the case that the Borrower’s
Common Stock is not deliverable by DWAC (including if the Borrower’s transfer agent has a policy prohibiting or limiting
delivery of shares of the Borrower’s Common Stock specified in a Notice of Conversion), (ii) if the Borrower ceases to be
a reporting company pursuant or subject to the Exchange Act, (iii) if the Borrower loses a market (including the OTCBB, OTCQB
or an equivalent replacement exchange) for its Common Stock, (iv) if the Borrower fails to maintain its status as “DTC Eligible”
for any reason, (v) if the Default Conversion Price is less than one cent ($0.01), (vi) if the Note cannot be converted into free
trading shares on or after six months from the Issue Date, (vii) if at any time the Borrower does not maintain or replenish the
Reserved Amount within three (3) business days of the request of the Holder, (viii) if the Borrower fails to maintain the listing
of the Common Stock on at least one of the OTC Markets or an equivalent replacement exchange, the Nasdaq National Market, the
Nasdaq Small Cap Market, the New York Stock Exchange, or the NYSE MKT, (ix) if the Borrower fails to comply with the reporting
requirements of the Exchange Act; the reporting requirements necessary to satisfy the availability of Rule 144 to the Holder or
its assigns, including but not limited to the timely fulfillment of its filing requirements as a fully-reporting issuer registered
with the SEC, the requirements for XBRL filings, the requirements for disclosure of financial statements on its website, (x) if
the Borrower effectuates a reverse split of its Common Stock without twenty (20) days prior written notice to the Holder, (xi)
if OTC Markets changes the Borrower’s designation to ‘No Information’ (Stop Sign), ‘Caveat Emptor’
(Skull and Crossbones), or ‘OTC’, ‘Other OTC’ or ‘Grey Market’ (Exclamation Mark Sign), (xii)
the restatement of any financial statements filed by the Borrower with the SEC for any date or period from two years prior to
the Issue Date of this Note and until this Note is no longer outstanding, if the result of such restatement would, by comparison
to the unrestated financial statement, have constituted a material adverse effect on the rights of the Holder with respect to
this Note or the Purchase Agreement, (xiii) any cessation of trading of the Common Stock on at least one of the OTC Markets or
an equivalent replacement exchange, the Nasdaq National Market, the Nasdaq Small Cap Market, the New York Stock Exchange, or the
NYSE MKT, and such cessation of trading shall continue for a period of five consecutive (5) Trading Days, and/or (xiv) the Borrower
loses the “bid” price for its Common Stock ($0.0001 on the “Ask” with zero market makers on the “Bid”
per Level 2), then the Holder shall be entitled to increase, by 7.5% for each occurrence, cumulative or otherwise, the discount
to the Default Conversion Price shall apply for all future conversions under the Note. Under no circumstances shall the Default
Conversion Price be less than 35% multiplied by the Market Price due to cumulative effect.

 

    	 

    	 

    

 

(c)
DTC Chill. If in the case that the Borrower’s Common Stock is “chilled” for deposit into the DTC system
and only eligible for clearing deposit, then an additional 15% discount to the Default Conversion Price shall apply for all future
conversions under all Notes while the “chill” is in effect.

 

(d)
[Intentionally Omitted].

 

(e)
Par Value Adjustments. To the extent the Default Conversion Price of the Borrower’s Common Stock closes below the
par value per share, the Borrower will take all steps necessary to solicit the consent of the stockholders to reduce the par value
to the lowest value possible under law. The Borrower agrees to honor all conversions submitted pending this adjustment unless
the Holder, in its sole and absolute discretion elects instead to set the Default Conversion Price to par value for such Conversion(s)
and the Conversion Amount for such Conversion(s) shall be increased to include Additional Principal, where “Additional Principal”
means such additional amount to be added to the Conversion Amount to the extent necessary to cause the number of Conversion Shares
issuable upon such Conversion(s) to equal the same number of Conversion Shares as would have been issued had the Default Conversion
Price not been subject to the minimum price set forth in this Section 1.2(e).

 

(f)
Default Conversion Price During Major Announcements. Notwithstanding anything contained in the preceding section to the
contrary, in the event the Borrower (i) makes a public announcement that it intends to consolidate or merge with any other corporation
(other than a merger in which the Borrower is the surviving or continuing corporation and its capital stock is unchanged) or sell
or transfer all or substantially all of the assets of the Borrower or (ii) any person, group or entity (including the Borrower)
publicly announces a tender offer to purchase 50% or more of the Borrower’s Common Stock (or any other takeover scheme)
(the date of the announcement referred to in clause (i) or (ii) is hereinafter referred to as the “Announcement Date”),
then the Default Conversion Price shall, effective upon the Announcement Date and continuing through the Adjusted Default Conversion
Price Termination Date (as defined below), be equal to the lower of (x) the Default Conversion Price which would have been applicable
for a Conversion occurring on the Announcement Date and (y) the Default Conversion Price that would otherwise be in effect. From
and after the Adjusted Default Conversion Price Termination Date, the Default Conversion Price shall be determined as set forth
in this Section. For purposes hereof, “Adjusted Default Conversion Price Termination Date” shall mean, with respect
to any proposed transaction or tender offer (or takeover scheme) for which a public announcement as contemplated by this Section
has been made, the date upon which the Borrower (in the case of clause (i) above) or the person, group or entity (in the case
of clause (ii) above) consummates or publicly announces the termination or abandonment of the proposed transaction or tender offer
(or takeover scheme) which caused this Section 1.2(d) to become operative.

 

    	 

    	 

    

 

(g)
Pro Rata Conversion; Disputes. In the event of a dispute as to the number of shares of Common Stock issuable to the Holder
in connection with a conversion of this Note, the Borrower shall issue to the Holder the number of shares of Common Stock not
in dispute and resolve such dispute in accordance with Section 4.13.

 

1.3
Authorized Shares. The Borrower covenants that during the period the conversion right exists, the Borrower will reserve
from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance
of Common Stock upon the full conversion of this Note issued pursuant to the Purchase Agreement. The Borrower is required at all
times to have authorized and reserved five (5) times the number of shares that is actually issuable upon full conversion of the
Note (based on the Default Conversion Price of the Notes in effect from time to time) (the “Reserved Amount”). Initially,
the Company will instruct the Transfer Agent to reserve 3,846,154 shares of common stock in the name of the Holder for
issuance upon conversion hereof. The Reserved Amount shall be increased from time to time in accordance with the Borrower’s
obligations pursuant to Section 3(d) of the Purchase Agreement. The Borrower represents that upon issuance, such shares will be
duly and validly issued, fully paid and non-assessable. In addition, if the Borrower shall issue any securities or make any change
to its capital structure which would change the number of shares of Common Stock into which the Notes shall be convertible at
the then current Default Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there
shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of
the outstanding Notes.

 

    	 

    	 

    

 

The
Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Common Stock issuable
upon conversion of this Note, and (ii) agrees that its issuance of this Note shall constitute full authority to its officers and
agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for shares
of Common Stock in accordance with the terms and conditions of this Note. Notwithstanding the foregoing, in no event shall the
Reserved Amount be lower than the initial Reserved Amount, regardless of any prior conversions.

 

1.4
Method of Conversion.

 

(a)
Mechanics of Conversion. Subject to Section 1.1, this Note may be converted by the Holder in whole or in part at any time
on or following the date that an Event of Default occurs under this Note, by (A) submitting to the Borrower a Notice of Conversion
(by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 11:59 p.m., New York,
New York time) and (B) subject to Section 1.4(b), surrendering this Note at the principal office of the Borrower.

 

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

 

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

 

    	 

    	 

    

 

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

 

(e)
Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail
(or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in
this Section 1.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder
certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”)
(and, solely in the case of conversion of the entire unpaid principal amount hereof, surrender of this Note) in accordance with
the terms hereof and the Purchase Agreement.

 

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

 

    	 

    	 

    

 

(g)
Delivery of Common Stock by Electronic Transfer. In lieu of delivering physical certificates representing the Common Stock
issuable upon conversion, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated
Securities Transfer (“FAST”) program, upon request of the Holder and its compliance with the provisions contained
in Section 1.1 and in this Section 1.4, the Borrower shall use its commercially reasonable best efforts to cause its transfer
agent to electronically transmit the Common Stock issuable upon conversion to the Holder by crediting the account of Holder’s
Prime Broker with DTC through its Deposit Withdrawal At Custodian (“DWAC”) system.

 

(i)
Failure to Deliver Common Stock Prior to Delivery Deadline. Without in any way limiting the Holder’s right to pursue
other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable
upon conversion of this Note is not delivered by the Deadline (other than a failure due to the circumstances described in Section
1.3 above, which failure shall be governed by such Section) the Borrower shall pay to the Holder $2,000 per day in cash, for each
day beyond the Deadline that the Borrower fails to deliver such Common Stock until the Borrower issues and delivers a certificate
to the Holder or credit the Holder’s balance account with OTC for the number of shares of Common Stock to which the Holder
is entitled upon such Holder’s conversion of any Conversion Amount (under Holder’s and Borrower’s expectation
that any damages will tack back to the Issue Date). Such cash amount shall be paid to Holder by the fifth day of the month following
the month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month
following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall
accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common
Stock in accordance with the terms of this Note. The Borrower agrees that the right to convert is a valuable right to the Holder.
The damages resulting from a failure, attempt to frustrate, and interference with such conversion right are difficult if not impossible
to qualify. Accordingly the parties acknowledge that the liquidated damages provision contained in this Section 1.4(i) are justified.

 

(j)
Rescindment of a Notice of Conversion. If (i) the Borrower fails to respond to Holder within three (3) business days from
the Conversion Date confirming the details of Notice of Conversion, (ii) the Borrower fails to provide any of the shares of the
Borrower’s Common Stock requested in the Notice of Conversion within three (3) business days from the Conversion Date specified
therein, (iii) the Holder is unable to procure a legal opinion required to have the shares of the Borrower’s Common Stock
issued unrestricted and/or deposited to sell for any reason related to the Borrower’s standing, (iv) the Holder is unable
to deposit the shares of the Borrower’s Common Stock requested in the Notice of Conversion for any reason related to the
Borrower’s standing, (v) at any time after a missed Deadline, at the Holder’s sole discretion, (vi) OTC Markets changes
the Borrower’s designation to ‘Limited Information’ (Yield), ‘No Information’ (Stop Sign), ‘Caveat
Emptor’ (Skull & Crossbones), ‘OTC’, ‘Other OTC’ or ‘Grey Market’ (Exclamation Mark
Sign) or other trading restriction on the day of or any day after the Conversion Date, then the Holder maintains the option and
sole discretion to rescind the applicable Notice of Conversion (“Rescindment”) pursuant to which such Conversion Shares
were issuable with a “Notice of Rescindment.” This Note shall remain convertible before and after the Maturity Date
hereof until this Note is repaid or converted in full.

 

    	 

    	 

    

 

1.5
Concerning the Shares. The shares of Common Stock issuable upon conversion of this Note may not be sold or transferred
unless (i) such shares are sold pursuant to an effective registration statement under the Act or (ii) the Borrower or its transfer
agent shall have been furnished with 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 (iii) such shares are sold or transferred pursuant to Rule 144 under the Act
(or a successor rule) (“Rule 144”) or (iv) such shares are transferred to an “affiliate” (as defined in
Rule 144) of the Borrower who agrees to sell or otherwise transfer the shares only in accordance with this Section 1.5 and who
is an Accredited Investor (as defined in the Purchase Agreement). Except as otherwise provided in the Purchase Agreement (and
subject to the removal provisions set forth below), until such time as the shares of Common Stock issuable upon conversion of
this Note have been registered under the Act or otherwise 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, each certificate for shares of Common Stock issuable
upon conversion of this Note that has not been so included in an effective registration statement or that has not been sold pursuant
to an effective registration statement or an exemption that permits removal of the legend, shall bear a legend substantially in
the following form, as appropriate:

 

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

 

    	 

    	 

    

 

The
legend set forth above shall be removed and the Borrower shall issue to the Holder a new certificate therefore free of any transfer
legend if (i) the Borrower or its transfer agent shall have received 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 Common Stock may be made
without registration under the Act, which opinion shall be reasonably accepted by the Borrower so that the sale or transfer is
effected or (ii) in the case of the Common Stock issuable upon conversion of this Note, such security is registered for sale by
the Holder under an effective registration statement filed under the Act or otherwise 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. In the event that the
Borrower does not accept the opinion of counsel provided by the Buyer with respect to the transfer of Securities pursuant to an
exemption from registration, such as Rule 144 or Regulation S, at the Deadline, it will be considered an Event of Default pursuant
to Section 3.2 of the Note. Notwithstanding anything to the contrary herein, the Borrower has no obligation to accept a legal
opinion (1) from an attorney that is not in good standing with the state(s) where it is licensed to practice law or (2) that is
not in form, substance and scope customary for opinions of counsel in comparable transactions. . In either such case, the Borrower
shall not be liable for damages for non-acceptance of such opinion.

 

1.6
Effect of Certain Events.

 

(a)
Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially
all of the assets of the Borrower, the effectuation by the Borrower of a transaction or series of related transactions in which
more than 50% of the voting power of the Borrower is disposed of, or the consolidation, merger or other business combination of
the Borrower with or into any other Person (as defined below) or Persons when the Borrower is not the survivor shall either: (i)
be deemed to be an Event of Default (as defined in Article III) pursuant to which the Borrower shall be required to pay to the
Holder upon the consummation of and as a condition to such transaction an amount equal to the Default Amount (as defined in Article
III) or (ii) be treated pursuant to Section 1.6(b) hereof. “Person” shall mean any individual, corporation, limited
liability company, partnership, association, trust or other entity or organization.

 

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

 

    	 

    	 

    

 

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

 

(d)
Adjustment Due to Dilutive Issuance from Subsequent Convertible Notes. If, at any time when any Notes are issued and outstanding,
the Borrower issues or sells, or in accordance with this Section 1.6(d) hereof is deemed to have issued or sold, except for shares
of Common Stock issued directly to vendors or suppliers of the Borrower in satisfaction of amounts owed to such vendors or suppliers
(provided, however, that such vendors or suppliers shall not have an arrangement to transfer, sell or assign such shares of Common
Stock prior to the issuance of such shares), any shares of Common Stock on or after the Issue Date for no consideration or for
a consideration per share (before deduction of reasonable expenses or commissions or underwriting discounts or allowances in connection
therewith) less than the Default Conversion Price in effect on the date of such issuance (or deemed issuance) of such shares of
Common Stock (a “Dilutive Issuance”), then immediately upon the Dilutive Issuance, the Default Conversion Price will
be reduced to the amount of the consideration per share received by the Borrower in such Dilutive Issuance.

 

    	 

    	 

    

 

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

 

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

 

1.7
Trading Market Limitations. Unless permitted by the applicable rules and regulations of the principal securities market
on which the Common Stock is then listed or traded, in no event shall the Borrower issue upon each conversion of this Note more
than the maximum number of shares of Common Stock that the Borrower can issue pursuant to any rule of the principal United States
securities market on which the Common Stock is then traded (the “Maximum Share Amount”), which shall be 4.99% (or
up to 9.99% if increased pursuant to the terms of hits Note) of the total shares outstanding at the time of each conversion, subject
to equitable adjustment from time to time for stock splits, stock dividends, combinations, capital reorganizations and similar
events relating to the Common Stock occurring after the date hereof.

 

    	 

    	 

    

 

1.8
Status as Shareholder. Upon submission of a Notice of Conversion by a Holder, (i) the shares covered thereby (other than
the shares, if any, which cannot be issued because their issuance would exceed such Holder’s allocated portion of the Reserved
Amount or Maximum Share Amount) shall be deemed converted into shares of Common Stock and (ii) the Holder’s rights as a
Holder of such converted portion of this Note shall cease and terminate, excepting only the right to receive certificates for
such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because
of a failure by the Borrower to comply with the terms of this Note. Notwithstanding the foregoing, if a Holder has not received
certificates for all shares of Common Stock prior to the third (3rd) business day after the expiration of the Deadline with respect
to a conversion of any portion of this Note for any reason, then (unless the Holder otherwise elects to retain its status as a
holder of Common Stock by so notifying the Borrower) the Holder shall regain the rights of a Holder of this Note with respect
to such unconverted portions of this Note and the Borrower shall, as soon as practicable, return such unconverted Note to the
Holder or, if the Note has not been surrendered, adjust its records to reflect that such portion of this Note has not been converted.
In all cases, the Holder shall retain all of its rights and remedies (including, without limitation, (i) the right to receive
Conversion Default Payments pursuant to Section 1.3 to the extent required thereby for such Conversion Default and any subsequent
Conversion Default and (ii) the right to have the Default Conversion Price with respect to subsequent conversions determined in
accordance with Section 1.3) for the Borrower’s failure to convert this Note.

 

1.9
Prepayment. Notwithstanding anything to the contrary contained in this Note, the Borrower may prepay the amounts outstanding
hereunder pursuant to the following terms and conditions:

 

(a)
At any time during the period beginning on the Issue Date and ending on the date which is one hundred eighty (180) days following
the Issue Date, the Borrower shall have the right, exercisable on not less than three (3) Trading Days prior written notice to
the Holder of the Note, to prepay the outstanding Note in full by making a payment to the Holder of an amount in cash equal to
the sum of: (i) the then outstanding principal amount of this Note plus (ii) accrued and unpaid interest on the unpaid
principal amount of this Note plus (iii) Default Interest, if any, in accordance with Article III, plus (iv) any
Additional Principal, plus (v) at the Holder’s option, any amounts owed to the Holder pursuant to any other provision
of this Note.

 

(b)
After the expiration of one hundred eighty (180) days following the date of the Note, the Borrower shall have no right of prepayment.

 

Any
notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be delivered to the Holder of the Note at its
registered addresses and shall state: (1) that the Borrower is exercising its right to prepay the Note, and (2) the date of prepayment
which shall be not more than three (3) Trading Days from the date of the Optional Prepayment Notice. On the date fixed for prepayment
(the “Optional Prepayment Date”), the Borrower shall make payment of the applicable prepayment amount to or upon the
order of the Holder as specified by the Holder in writing to the Borrower at least one (1) business day prior to the Optional
Prepayment Date.

 

    	 

    	 

    

 

Upon
confirmation by Holder that the prepayment has been received by the Holder and that all amounts outstanding under this Note are
paid in full, the Holder (through the third party escrow agent) shall return the Returnable Shares back to the Company’s
treasury within three (3) business days of such confirmation by Holder, along with all documents required for cancellation, including
a medallion-guaranteed stock power.

 

Article
II. CERTAIN COVENANTS

 

2.1
[Intentionally Omitted].

 

2.2
[Intentionally Omitted].

 

2.3
[Intentionally Omitted].

 

2.4
Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the
Holder’s written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary
course of business. Any consent to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition.

 

2.5
[Intentionally Omitted.]

 

2.6
[Intentionally Omitted].

 

2.7
Preservation of Existence, etc. The Borrower shall maintain and preserve, and cause each of its Subsidiaries to maintain
and preserve, its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries (other than dormant
Subsidiaries that have no or minimum assets) to become or remain, duly qualified and in good standing in each jurisdiction in
which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification
necessary.

 

2.8
Non-circumvention. The Borrower hereby covenants and agrees that the Borrower will not, by amendment of its Certificate
or Articles of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement,
dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance
of any of the terms of this Note, and will at all times in good faith carry out all the provisions of this Note and take all action
as may be required to protect the rights of the Holder.

 

    	 

    	 

    

 

2.9
Charter. So long as the Borrower shall have any obligations under this Note, the Borrower shall not amend its charter documents,
including without limitation its certificate of incorporation and bylaws, in any manner that materially and adversely affects
any rights of the Holder.

 

Article
III. EVENTS OF DEFAULT

 

If
any of the following events of default (each, an “Event of Default”) shall occur:

 

3.1
Failure to Pay Principal or Interest. The Borrower fails to pay the principal hereof or interest thereon when due on this
Note, whether at maturity, upon acceleration or otherwise. Any amount of principal on this Note which is not paid when due shall
bear interest at the rate of Twenty Four percent (24%) per annum from the due date thereof until the same is paid (“Default
Interest”).

 

3.2
Conversion and the Shares. The Borrower fails to issue shares of Common Stock to the Holder (or announces or threatens
in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder
in accordance with the terms of this Note, fails to transfer or cause its transfer agent to transfer (issue) (electronically or
in certificated form) any certificate for shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant
to this Note as and when required by this Note, the Borrower directs its transfer agent not to transfer or delays, impairs, and/or
hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for shares of
Common Stock to be issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note,
or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing)
any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any shares of
Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or
makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph)
and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall
not be rescinded in writing) for three (3) business days after the Holder shall have delivered a Notice of Conversion. It is an
obligation of the Borrower to remain current in its obligations to its transfer agent. It shall be an event of default of this
Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent.
If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process a conversion,
such advanced funds shall be paid by the Borrower to the Holder within forty eight (48) hours of a demand from the Holder.

 

3.3
Breach of Covenants. The Borrower breaches any material covenant or other material term or condition contained in this
Note and any collateral documents including but not limited to the Purchase Agreement.

 

    	 

    	 

    

 

3.4
Breach of Representations and Warranties. Any representation or warranty of the Borrower made herein or in any agreement,
statement or certificate given in writing pursuant hereto or in connection herewith (including, without limitation, the Purchase
Agreement), shall be false or misleading in any material respect when made and the breach of which has (or with the passage of
time will have) a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.

 

3.5
Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors
or commence proceedings for its dissolution, or apply for or consent to the appointment of a receiver or trustee for it or for
a substantial part of its property or business, or such a receiver or trustee shall otherwise be appointed for the Borrower or
for a substantial part of its property or business without its consent and shall not be discharged within sixty (60) days after
such appointment.

 

3.6
Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary,
for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any
subsidiary of the Borrower, or the Borrower admits in writing its inability to pay its debts generally as they mature, or have
filed against it an involuntary petition for bankruptcy relief, all under federal or state laws as applicable or the Borrower
admits in writing its inability to pay its debts generally as they mature, or have filed against it an involuntary petition for
bankruptcy relief, all under international, federal or state laws as applicable.

 

3.7
Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.

 

3.8
Cessation of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise generally unable to
pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as
a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.

 

3.9
Maintenance of Assets. The failure by Borrower to maintain any material intellectual property rights, personal, real property
or other assets which are necessary to conduct its business (whether now or in the future).

 

3.10
Cross-Default. Notwithstanding anything to the contrary contained in this Note or the other related or companion documents,
a breach or default by the Borrower of any covenant or other term or condition contained in any of the Other Agreements (as defined
herein), after the passage of all applicable notice and cure or grace periods, shall, at the option of the Holder, be considered
a default under this Note and the Other Agreements, in which event the Holder shall be entitled (but in no event required) to
apply all rights and remedies of the Holder under the terms of this Note and the Other Agreements by reason of a default under
said Other Agreement or hereunder. “Other Agreements” means, collectively, all agreements and instruments between,
among or by: (1) the Borrower, and (2) the Holder or any other third party, including, without limitation, promissory notes; provided,
however, the term “Other Agreements” shall not include this Note. Each of the loan transactions will be cross-defaulted
with each other loan transaction and with all other existing and future debt of Borrower to the Holder.

 

    	 

    	 

    

 

3.11
[Intentionally Omitted].

 

3.12
Judgments. Any money judgment, writ or similar process shall be entered or filed against the Borrower or any subsidiary
of the Borrower or any of its property or other assets for more than $250,000.00, and shall remain unvacated, unbonded or unstayed
for a period of twenty (20) days unless otherwise consented to by the Holder, which consent will not be unreasonably withheld.

 

3.13
Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent and (i) the Borrower
fails to obtain written approval from the Holder prior to the effective date of such replacement, or (ii) the Borrower fails to
provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as
initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares
of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.

 

3.14
Bid Price. If the Borrower loses the “bid” price for its Common Stock ($0.0001 on the “Ask” with
zero market makers on the “Bid” per Level 2) and/or a market (including the OTCBB, OTCQB or an equivalent replacement
exchange) for its Common Stock.

 

3.15
Failure To Deliver Returnable Shares. The Borrower fails to deliver the Returnable Shares to the Holder within three (3)
business days of the Issue Date.

 

3.16
Market Capitalization. The Borrower fails to maintain a market capitalization of at least $10,000,000 on any Trading Day,
which shall be calculated by multiplying (i) the closing bid price of the Borrower’s common stock on the Trading Day immediately
preceding the respective date of calculation by (ii) the total shares of the Borrower’s common stock issued and outstanding
on the Trading Day immediately preceding the respective date of calculation.

 

3.17
Maximum Conversion. If at any time while this Note is outstanding, and assuming the beneficial ownership limitations contained
in this Note did not apply to this specific calculation, the Holder could convert the amounts outstanding under Note into more
than 4.99% of the outstanding shares of Common Stock of the Company as of the date of calculation

 

    	 

    	 

    

 

UPON
THE OCCURRENCE AND DURING THE CONTINUATION OF ANY EVENT OF DEFAULT SPECIFIED IN SECTION 3.2, THE NOTE SHALL BECOME IMMEDIATELY
DUE AND PAYABLE, THE HOLDER SHALL NO LONGER BE REQUIRED TO RETURN THE RETURNABLE SHARES TO THE BORROWER UNDER ANY CIRCUMSTANCES,
AND THE BORROWER SHALL PAY TO THE HOLDER, IN FULL SATISFACTION OF ITS OBLIGATIONS HEREUNDER, AN AMOUNT EQUAL TO: (Y) THE DEFAULT
SUM (AS DEFINED HEREIN); MULTIPLIED BY (Z) TWO (2). Upon the occurrence and during the continuation of any Event of Default specified
in Sections 3.1, 3.3, 3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 3.16, or 3.17 , exercisable through the
delivery of written notice to the Borrower by such Holders (the “Default Notice”), the Holder shall no longer be required
to return the Returnable Shares to the Borrower under any circumstances and the Note shall become immediately due and payable
and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to (i) 150% times
the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the
unpaid principal amount of this Note to the date of payment (the “Mandatory Prepayment Date”) plus (y) Default
Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the Holder pursuant
to Sections 1.3 and 1.4(g) hereof (the then outstanding principal amount of this Note to the date of payment plus the amounts
referred to in clauses (x), (y) and (z) shall collectively be known as the “Default Sum”) or (ii) at the option of
the Holder, the “parity value” of the Default Sum to be prepaid, where parity value means (a) the highest number of
shares of Common Stock issuable upon conversion of or otherwise pursuant to such Default Sum in accordance with Article I, treating
the Trading Day immediately preceding the Mandatory Prepayment Date as the “Conversion Date” for purposes of determining
the lowest applicable Default Conversion Price, unless the Default Event arises as a result of a breach in respect of a specific
Conversion Date in which case such Conversion Date shall be the Conversion Date), multiplied by (b) the highest Trading
Price for the Common Stock during the period beginning on the date of first occurrence of the Event of Default and ending one
day prior to the Mandatory Prepayment Date (the “Default Amount”) and all other amounts payable hereunder shall immediately
become due and payable, all without demand, presentment or notice, all of which hereby are expressly waived, together with all
costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be entitled to exercise all
other rights and remedies available at law or in equity.

 

If
the Borrower fails to pay the Default Amount within five (5) business days of written notice that such amount is due and payable,
then the Holder shall have the right at any time, so long as the Borrower remains in default (and so long and to the extent that
there are sufficient authorized shares), to require the Borrower, upon written notice, to immediately issue, in lieu of the Default
Amount, the number of shares of Common Stock of the Borrower equal to the Default Amount divided by the Default Conversion Price
then in effect. This requirement by the Borrower shall automatically apply upon the occurrence of an Event of Default without
the need for any party to give any notice or take any other action.

 

If
the Holder shall commence an action or proceeding to enforce any provisions of this Note, including, without limitation, engaging
an attorney, then if the Holder prevails in such action, the Holder shall be reimbursed by the Borrower for its attorneys’
fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.

 

    	 

    	 

    

 

Article
IV. MISCELLANEOUS

 

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

 

4.2
Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder
shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered
or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid,
or (iv) transmitted by hand delivery, telegram, 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, with accurate confirmation generated by the transmitting
facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where
such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during
normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by
express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first
occur. The addresses for such communications shall be:

 

If
to the Borrower, to:

 

Inception
Mining, Inc.

5330
South 900 East, Suite 280

Murray,
UT 84107

E-mail:
info@inceptionmining.com

 

With
a copy to (which copy shall not constitute notice):

 

Brunson,
Chandler, & Jones, PLLC

175
South Main St., Suite 1410

Salt
Lake City, UT 84111

E-mail:
callielance@bcjlaw.com

 

If
to the Holder:

 

Labrys
Fund, LP

48
Parker Road

Wellesley,
MA 02482

E-mail:
admin@equiluxgroup.com

 

    	 

    	 

    

 

With
a copy to (which copy shall not constitute notice):

 

Legal
& Compliance, LLC

330
Clematis Street, Ste. 217

West
Palm Beach, FL 33401

Attn:
Chad Friend, Esq.

E-mail:
CFriend@LegalAndCompliance.com

 

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

 

4.4
Assignability. The Holder may assign or transfer this Note to any transferee at its sole discretion. This Note shall be
binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and
assigns. Each transferee of this Note must be an “accredited investor” (as defined in Rule 501(a) of the 1933 Act).
Notwithstanding anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide
margin account or other lending arrangement. The Holder and any assignee, by acceptance of this Note, acknowledge and agree
that following conversion of a portion of this Note, the unpaid and unconverted principal amount of this Note represented by this
Note may be less than the amount stated on the face hereof.

 

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

 

4.6
Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of Nevada without
regard to principles of conflicts of laws. The parties hereby warrant and represent that the selection of Nevada law as governing
under this Note (i) has a reasonable nexus to each of the Parties and to the transactions contemplated by the Note; and (ii) does
not offend any public policy of Nevada, Massachusetts, or of any other state, federal, or other jurisdiction. Any action brought
by either party against the other arising out of or related to this Note, or any other agreements between the parties, shall be
commenced only in the state or federal courts of general jurisdiction located in the Commonwealth of Massachusetts, except that
all such disputes between the parties shall be subject to alternative dispute resolution through binding arbitration at the Holder’s
sole discretion and election (regardless of which party initiates the legal proceedings). The parties to this Note 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 agree that, in connection with any
such arbitration proceeding, each shall submit or file any claim which would constitute a compulsory counterclaim within the same
proceeding as the claim to which it relates. Any such claim that is not submitted or filed in such proceeding shall be waived
and such party will forever be barred from asserting such a claim. Both parties agree to submit to the jurisdiction of such courts
or to such arbitration panel, as the case may be.

 

    	 

    	 

    

 

If
the Holder elects alternative dispute resolution by arbitration, the arbitration proceedings shall be conducted in the Commonwealth
of Massachusetts and administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules
and Mediation Procedures in effect on the Issue Date, except as modified by this Note. The Holder’s election to arbitrate
shall be made in writing, delivered to the other party, and filed with the American Arbitration Association. The American Arbitration
Association must receive the demand for arbitration prior to the date when the institution of legal or equitable proceedings would
be barred by the applicable statute of limitations, unless legal or equitable proceedings between the parties have already commenced,
and the receipt by the American Arbitration Association of a written demand for arbitration also shall constitute the institution
of legal or equitable proceedings for statute of limitations purposes. The parties shall be entitled to limited discovery at the
discretion of the arbitrator(s) who may, but are not required to, allow depositions. The parties acknowledge that the arbitrators’
subpoena power is not subject to geographic limitations. The arbitrator(s) shall have the right to award individual relief which
he or she deems proper under the evidence presented and applicable law and consistent with the parties’ rights to, and limitations
on, damages and other relief as expressly set forth in this Note. The award and decision of the arbitrator(s) shall be conclusive
and binding on all parties, and judgment upon the award may be entered in any court of competent jurisdiction. The Holder reserves
the right, but shall have no obligation, to advance the Issuer’s share of the costs, fees and expenses of any arbitration
proceeding, including any arbitrator fees, in order for such arbitration proceeding to take place, and by doing so will not be
deemed to have waived or relinquished its right to seek the recovery of those amounts from the arbitrator, who shall provide for
such relief in the final award, in addition to the costs, fees, and expenses that are otherwise recoverable. The foregoing agreement
to arbitrate shall be specifically enforceable under applicable law in any court having jurisdiction thereof.

 

THE
BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY
DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

    	 

    	 

    

 

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 Note or any other agreement delivered in connection herewith is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith
and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable
under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably
waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this
Note or any other related transaction document by mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service
shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit
in any way any right to serve process in any other manner permitted by law.

 

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

 

4.8
Purchase Agreement. By its acceptance of this Note, each party agrees to be bound by the applicable terms of the Purchase
Agreement.

 

4.9
Notice of Corporate Events. Except as otherwise provided below, the Holder of this Note shall have no rights as a Holder
of Common Stock unless and only to the extent that it converts this Note into Common Stock. The Borrower shall provide the Holder
with prior notification of any meeting of the Borrower’s shareholders (and copies of proxy materials and other information
sent to shareholders). In the event of any taking by the Borrower of a record of its shareholders for the purpose of determining
shareholders who are entitled to receive payment of any dividend or other distribution, any right to subscribe for, purchase or
otherwise acquire (including by way of merger, consolidation, reclassification or recapitalization) any share of any class or
any other securities or property, or to receive any other right, or for the purpose of determining shareholders who are entitled
to vote in connection with any proposed sale, lease or conveyance of all or substantially all of the assets of the Borrower or
any proposed liquidation, dissolution or winding up of the Borrower, the Borrower shall mail a notice to the Holder, at least
twenty (20) days prior to the record date specified therein (or thirty (30) days prior to the consummation of the transaction
or event, whichever is earlier), of the date on which any such record is to be taken for the purpose of such dividend, distribution,
right or other event, and a brief statement regarding the amount and character of such dividend, distribution, right or other
event to the extent known at such time. The Borrower shall make a public announcement of any event requiring notification to the
Holder hereunder substantially simultaneously with the notification to the Holder in accordance with the terms of this Section
4.9 including, but not limited to, name changes, recapitalizations, etc. as soon as possible under law.

 

    	 

    	 

    

 

4.10
Usury. If Notwithstanding any provision in this Note or the related transaction documents to the contrary, the total liability
for payments of interest and payments in the nature of interest, including, without limitation, all charges, fees, exactions,
or other sums which may at any time be deemed to be interest, shall not exceed the limit imposed by the usury laws of the jurisdiction
governing this Note or any other applicable law. In the event the total liability of payments of interest and payments in the
nature of interest, including, without limitation, all charges, fees, exactions or other sums which may at any time be deemed
to be interest, shall, for any reason whatsoever, result in an effective rate of interest, which for any month or other interest
payment period exceeds the limit imposed by the usury laws of the jurisdiction governing this Note, all sums in excess of those
lawfully collectible as interest for the period in question shall, without further agreement or notice by, between, or to any
party hereto, be applied to the reduction of the outstanding principal balance due hereunder immediately upon receipt of such
sums by the Holder hereof, with the same force and effect as though the Company had specifically designated such excess sums to
be so applied to the reduction of the principal balance then outstanding, and the Holder hereof had agreed to accept such sums
as a penalty-free payment of principal; provided, however, that the Holder may, at any time and from time to time, elect, by notice
in writing to the Company, to waive, reduce, or limit the collection of any sums in excess of those lawfully collectible as interest,
rather than accept such sums as a prepayment of the principal balance then outstanding. It is the intention of the parties that
the Company does not intend or expect to pay, nor does the Holder intend or expect to charge or collect any interest under this
Note greater than the highest non-usurious rate of interest which may be charged under applicable law.

 

4.11
Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the
Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that
the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened
breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies
at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing
or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing
economic loss and without any bond or other security being required. No provision of this Note shall alter or impair the obligation
of the Borrower, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place,
and rate, and in the form, herein prescribed.

 

    	 

    	 

    

 

4.12
Severability. In the event that any provision of this Note 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 to 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.

 

4.13
Dispute Resolution. In the case of a dispute as to the determination of the Default Conversion Price, Conversion Amount,
any prepayment amount or Default Amount, Default Sum, Issue, Closing or Maturity Date, the closing bid price, or fair market value
(as the case may be) or the arithmetic calculation of the Default Conversion Price or the applicable prepayment amount(s) (as
the case may be), the Borrower or the Holder shall submit the disputed determinations or arithmetic calculations via facsimile
(i) within two (2) Business Days after receipt of the applicable notice giving rise to such dispute to the Borrower or the Holder
or (ii) if no notice gave rise to such dispute, at any time after the Holder learned of the circumstances giving rise to such
dispute. If the Holder and the Borrower are unable to agree upon such determination or calculation within two (2) Business Days
of such disputed determination or arithmetic calculation (as the case may be) being submitted to the Borrower or the Holder, then
the Borrower shall, within two (2) Business Days, submit via facsimile (a) the disputed determination of the Default Conversion
Price, the closing bid price, the or fair market value (as the case may be) to an independent, reputable investment bank selected
by the Borrower and approved by the Holder or (b) the disputed arithmetic calculation of the Default Conversion Price, Conversion
Amount, any prepayment amount or Default Amount, Default Sum to an independent, outside accountant selected by the Holder that
is reasonably acceptable to the Borrower. The Borrower shall cause at its expense the investment bank or the accountant to perform
the determinations or calculations and notify the Borrower and the Holder of the results no later than ten (10) Business Days
from the time it receives such disputed determinations or calculations. Such investment bank’s or accountant’s determination
or calculation shall be binding upon all parties absent demonstrable error.

 

4.14
Terms of Future Financings. So long as this Note is outstanding, upon any issuance by the Borrower or any of its subsidiaries
of any security with any term more favorable to the holder of such security or with a term in favor of the holder of such security
that was not similarly provided to the Holder in this Note, then the Borrower shall notify the Holder of such additional or more
favorable term and such term, at Holder’s option, shall become a part of the transaction documents with the Holder. The
types of terms contained in another security that may be more favorable to the holder of such security include, but are not limited
to, terms addressing conversion discounts, prepayment rate, conversion lookback periods, interest rates, original issue discounts,
stock sale price, private placement price per share, and warrant coverage.

 

    	 

    	 

    

 

4.15
Piggyback Registration Rights. The Borrower shall include on the next registration statement the Borrower files with SEC
(or on the subsequent registration statement if such registration statement is withdrawn) all shares issuable upon conversion
of this Note so long as the Borrower has not been advised that doing so would exceed the share amount registration limitation
pursuant to Rule 415 and the SEC’s customary view regarding the number of shares available to be registered on a delayed
or continuous basis without the Borrower being eligible to use Form S-3. Failure to do so will result in liquidated damages of
25% of the outstanding principal balance of this Note, but not less than Fifteen Thousand and No/100 United States Dollars ($15,000),
being immediately due and payable to the Holder at its election in the form of a cash payment or added to the balance of this
Note.

 

4.16
Disclosure. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Note, unless the
Company has in good faith determined that the matters relating to such notice do not constitute material, non-public information
relating to the Company or any of its Subsidiaries, the Company shall within one (1) Trading Day after any such receipt or delivery,
publicly disclose such material, non-public information on a Current Report on Form 8-K or otherwise. In the event that the Company
believes that a notice contains material, non-public information relating to the Company or any of its Subsidiaries, the Company
so shall indicate to such Holder contemporaneously with delivery of such notice, and in the absence of any such indication, the
Holder shall be allowed to presume that all matters relating to such notice do not constitute material, non-public information
relating to the Company or its Subsidiaries.

 

[signature
page to follow]

 

    	 

    	 

    

 

IN
WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer as of the date first above
written.

 

	 	INCEPTION MINING, INC.
	 	 	 
	 	By:	 
	 	Name:	Trent
    D’Ambrosio
	 	Title:	Chief
    Executive Officer

 

    	 

    	 

    

 

EXHIBIT
A

NOTICE
OF CONVERSION

 

The
undersigned hereby elects to convert $_________________principal amount of the Note (defined below) together with $________________
of accrued and unpaid interest thereto, totaling $_____________ into that number of shares
of Common Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of
Inception Mining, Inc., a Nevada corporation (the “Borrower”), according to the conditions of the convertible note
of the Borrower dated as of March 8, 2017 (the “Note”), as of the date written below. No fee will be charged to the
Holder for any conversion, except for transfer taxes, if any.

 

Box
Checked as to applicable instructions:

 

	 	[  ]
    	The
    Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the
    undersigned or its nominee with DTC through its Deposit Withdrawal At Custodian system (“DWAC Transfer”).
	 	 	 
	 	 	Name
    of DTC Prime Broker:
	 	 	Account
    Number:
	 	 	 
	 	[  ]
    	The
    undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock
    set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately
    below or, if additional space is necessary, on an attachment hereto:

 

	 	Name:
    Labrys Fund, LP	 	 
	 	Address:
    _________________________________	 	 
	 	 	 	 
	 	Date
    of Conversion: 	______________	 
	 	 	 	 
	 	Conversion
    Price ($0.30)	 	 
	 	 	 	 
	 	Applicable
        Default Conversion Price:

        $____________
	 	 
	 	 	 	 
	 	Number
    of Shares of Common Stock to be Issued	 	 
	 	Pursuant
    to Conversion of the Notes: 	 ______________	 
	 	 	 	 
	 	Amount
    of Principal Balance Due remaining	 	 
	 	Under
    the Note after this conversion: 	 ______________	 
	 	 	 	 
	 	Accrued
    and unpaid interest remaining:	$_____________	 
	 	 	 	 
	 	Default
    Amounts & Penalties remaining (if applicable):	$_____________	 

 

	 	LABRYS FUND, LP
	 	 	 	 
	 	By:	 	 
	 	Name:
    	 	 
	 	Title:	Principal	 
	 	Date:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00269-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00269-of-00352.parquet"}]]