Document:

Exhibit 10.7

 

SECURITIES
PURCHASE AGREEMENT

 

This
SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of September 8, 2022, by and between SIMPLICITY ESPORTS
AND GAMING COMPANY, a Delaware corporation, with headquarters located at 7000 West Palmetto Park Road, Suite 505, Boca Raton, Florida
33433 (the “Company”), and FIRSTFIRE GLOBAL OPPORTUNITIES FUND LLC, (the “Buyer”).

 

WHEREAS:

 

A.
The Company and the Buyer are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded
by Section 4(a)(2) of the Securities Act of 1933, as amended (the “1933 Act”) and Rule 506(b) promulgated by the United States
Securities and Exchange Commission (the “SEC”) under the 1933 Act;

 

B.
Buyer desires to purchase from the Company, and the Company desires to issue and sell to the Buyer, upon the terms and conditions set
forth in this Agreement, a Convertible Promissory Note of the Company, in the aggregate principal amount of $66,000.00 (as the principal
amount thereof may be increased pursuant to the terms thereof, and together with any note(s) issued in replacement thereof or as a dividend
thereon or otherwise with respect thereto in accordance with the terms thereof, in the form attached hereto as Exhibit A (the
“Note”), convertible into shares of common stock of the Company (the “Common Stock”), upon the terms and subject
to the limitations and conditions set forth in such Note;

 

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

 

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

 

1.
Purchase and Sale of the Securities.

 

a.
Purchase of Note. On the Closing Date (as defined below), the Company shall issue and sell to the Buyer and the Buyer agrees to
purchase from the Company the Note, subject to the terms of the Note and this Agreement as the case may be.

 

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

 

c.
Form of Payment. On the Closing Date, the Buyer shall pay the purchase price of $60,000 (the “Purchase Price”) for
the Note, by wire transfer of immediately available funds, in accordance with the Company’s written wiring instructions, against
delivery of the Note, and the Warrant, and the Company shall deliver such duly executed Note and Warrant on behalf of the Company, to
the Buyer.

 

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

 

e.
Closing. The closing of the transactions contemplated by this Agreement (the “Closing”) shall occur on the Closing
Date at such location as may be agreed to by the parties (including via exchange of electronic signatures).

 

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

 

a.
Investment Purpose. As of the Closing Date, the Buyer is purchasing the Note and the Warrant, \ and the shares of Common Stock
issuable upon conversion or exercise thereof, or otherwise issued pursuant to the Note or Warrant and such additional shares of Common
Stock, if any, as are issuable on account of interest on the Note pursuant to this Agreement, such shares of Common Stock being collectively
referred to herein as the “Conversion Shares” and, collectively with the Note, and the Warrant, the “Securities”)
for its own account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered
or exempted from registration under the 1933 Act; provided, however, that by making the representations herein, the Buyer
does not agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities
at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act.

 

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

 

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

 

d.
Information. The Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances, and
operations of the Company and materials relating to the offer and sale of the Securities which have been requested by the Buyer or its
advisors. The Buyer and its advisors, if any, have been afforded the opportunity to ask questions of the Company regarding its business
and affairs. Notwithstanding the foregoing, the Company has not disclosed to the Buyer any material nonpublic information regarding the
Company or otherwise, and will not disclose such information unless such information is disclosed to the public prior to or promptly
following such disclosure to the Buyer. Neither such inquiries nor any other due diligence investigation conducted by Buyer or any of
its advisors or representatives shall modify, amend or affect Buyer’s right to rely on the Company’s representations and
warranties contained in Section 3 below.

 

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

 

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f. Transfer
or Resale. Without limiting any of the Company’s obligations hereunder, the Buyer understands that (i) the sale or resale
of the Securities have not been, and as of the date hereof, are currently not being registered under the 1933 Act or any applicable
state securities laws, and the Securities may not be transferred unless (a) the Securities are sold pursuant to an effective
registration statement under the 1933 Act; (b) the Buyer shall have delivered to the Company, at the cost of the Company, an opinion
of counsel (which may be the Legal Counsel Opinion (as defined below)) that shall be in form, substance, and scope customary for
opinions of counsel in comparable transactions to the effect that the Securities to be sold or transferred may be sold or
transferred pursuant to an exemption from such registration, which opinion shall be accepted by the Company; (c) the Securities are
sold or transferred to an “affiliate” (as defined in Rule 144 promulgated under the 1933 Act (or a successor rule)
(“Rule 144”)) of the Buyer who agrees to sell or otherwise transfer the Securities only in accordance with this Section
2(f) and who is an Accredited Investor; (d) the Securities are sold pursuant to Rule 144 or other applicable exemption and the Buyer
shall have delivered to the Company, at the cost of the Company, an opinion of counsel that shall be in form, substance and scope
customary for opinions of counsel in corporate transactions, which opinion shall be accepted by the Company; (ii) any sale of such
Securities made in reliance on Rule 144 may be made only in accordance with the terms of said Rule and further, if said Rule is not
applicable, any resale of such Securities under circumstances in which the seller (or the person through whom the sale is made) may
be deemed to be an underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the
1933 Act or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other person is under any
obligation to register such Securities under the 1933 Act or any state securities laws or to comply with the terms and conditions of
any exemption thereunder (in each case).

 

g.
Legends. The Buyer understands that until such time as the Securities have been registered under the 1933 Act or may be sold pursuant
to any applicable exemption without any restriction as to the number of securities as of a particular date that can then be immediately
sold, the Securities may bear a restrictive legend in substantially the following form (and a stop-transfer order may be placed against
transfer of the certificates for such Securities):

 

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

 

The
legend set forth above shall be removed and the Company shall issue a certificate for the applicable shares of Common Stock without
such legend to the holder of any Security upon which it is stamped or (as requested by such holder) issue the applicable shares of
Common Stock to such holder by electronic delivery by crediting the account of such holder’s broker with The Depository Trust
Company (“DTC”), if, unless otherwise required by applicable state securities laws, (a) such Security is registered for
sale under an effective registration statement filed under the 1933 Act or otherwise may be sold pursuant to an applicable exemption
without any restriction as to the number of securities as of a particular date that can then be immediately sold; or (b) the Company
or the Buyer provides the Legal Counsel Opinion (as contemplated by and in accordance herewith) to the effect that a public sale or
transfer of such Security may be made without registration under the 1933 Act, which opinion shall be accepted by the Company so
that the sale or transfer is effected. The Company shall be responsible for the fees of its transfer agent and all DTC fees
associated with any such issuance. The Buyer agrees to sell all Securities, including those represented by a certificate(s) from
which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. In the event that the
Company does not accept the opinion of counsel provided by the Buyer with respect to the transfer of Securities pursuant to an
exemption from registration, under any applicable exemption at the Deadline (as defined in the Note), it will be considered an Event
of Default pursuant to Section 3 of the Note.

 

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h.
Authorization; Enforcement. This Agreement has been duly and validly authorized by the Buyer and has been duly executed and delivered
on behalf of the Buyer, and this Agreement constitutes a valid and binding agreement of the Buyer enforceable in accordance with its
terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors’
rights generally and except as may be limited by the exercise of judicial discretion in applying principles of equity.

 

i.
[Reserved.]

 

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

 

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

 

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

 

b. Authorization;
Enforcement. (i) The Company has all requisite corporate power and authority to enter into and perform this Agreement, the Note,
the Warrant, and to consummate the transactions contemplated hereby and thereby and to issue the Securities, in accordance with the
terms hereof and thereof; (ii) the execution and delivery of this Agreement, the Note, and the Warrant by the Company and the
consummation by it of the transactions contemplated hereby and thereby (including without limitation, the issuance of the Note and
the Warrant, as well as the issuance and reservation for issuance of the Conversion Shares issuable upon conversion of the Note or
exercise of the Warrant) have been duly authorized by the Company’s Board of Directors and no further consent or authorization
of the Company, its Board of Directors, its shareholders, or its debt holders is required; (iii) this Agreement, the Note, and the
Warrant, (together with any other instruments executed in connection herewith or therewith) have been duly executed and delivered by
the Company by its authorized representative, and such authorized representative is the true and official representative with
authority to sign this Agreement, the Note, the Warrant, and the other instruments documents executed in connection herewith or
therewith and bind the Company accordingly; and (iv) this Agreement constitutes, and upon execution and delivery by the Company of
the Note, the Warrant, and each of such instruments will constitute, a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with their terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors’ rights generally and except as may be limited by the
exercise of judicial discretion in applying principles of equity.

 

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c.
Capitalization; Governing Documents. As of September 8, 2022, the authorized capital stock of the Company consists of: 36,000,000
authorized shares of Common Stock, of which and 3,158,161 shares were outstanding. All of such outstanding shares of capital stock of
the Company and the Conversion Shares, are, or upon issuance will be, duly authorized, validly issued, fully paid and non-assessable.
No shares of capital stock of the Company are subject to preemptive rights or any other similar rights of the shareholders of the Company
or any liens or encumbrances imposed through the actions or failure to act of the Company. As of the effective date of this Agreement,
other than as publicly announced prior to such date and reflected in the SEC Documents (as defined in this Agreement) of the Company
(i) there are no outstanding options, warrants, scrip, rights to subscribe for, puts, calls, rights of first refusal, agreements, understandings,
claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable
for any shares of capital stock of the Company or any of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries
is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries; (ii) other than provided
herein, there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale
of any of its or their securities under the 1933 Act; and (iii) there are no anti-dilution or price adjustment provisions contained in
any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the issuance
of any of the Securities. The Company has furnished to the Buyer true and correct copies of the Company’s Certificate of Incorporation
as in effect on the date hereof (“Certificate of Incorporation”), the Company’s Bylaws, as in effect on the date hereof
(the “Bylaws”), and the terms of all securities convertible into or exercisable for Common Stock of the Company and the material
rights of the holders thereof in respect thereto.

 

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

 

e.
No Broker-Dealer Acknowledgement. Unless otherwise advised by legal counsel to the Company, the Company shall not to any person,
institution, governmental or other entity, state, claim, allege, or in any way assert, that Buyer is currently, or ever has been a broker-dealer
under the Securities Exchange Act of 1934.

 

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

 

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g. Ranking;
No Conflicts. The Note shall be a subordinate debt obligation of the Company. The execution, delivery and performance of this
Agreement and the Note by the Company and the consummation by the Company of the transactions contemplated hereby and thereby
(including, without limitation, the issuance and reservation for issuance of the Conversion Shares) will not (i) conflict with or
result in a violation of any provision of the Certificate of Incorporation or Bylaws; or (ii) violate or conflict with, or result in
a breach of any provision of, or constitute a default (or an event which with notice or lapse of time or both could become a
default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, note,
evidence of indebtedness, indenture, patent, patent license or instrument to which the Company or any of its Subsidiaries is a
party; or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state
securities laws and regulations and regulations of any self-regulatory organizations to which the Company or its securities is
subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its
Subsidiaries is bound or affected (except for such conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations as would not, individually or in the aggregate, have a Material Adverse Effect); or (iv) trigger any anti-dilution or
ratchet provision contained in any other contract in which the Company is a party thereto or any security issued by the Company.
Neither the Company nor any of its Subsidiaries is in violation of its Certificate of Incorporation, Bylaws or other organizational
documents and neither the Company nor any of its Subsidiaries is in default (and no event has occurred which with notice or lapse of
time or both could put the Company or any of its Subsidiaries in default) under, and neither the Company nor any of its Subsidiaries
has taken any action or failed to take any action that would give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party or by which any
property or assets of the Company or any of its Subsidiaries is bound or affected, except for possible defaults as would not,
individually or in the aggregate, have a Material Adverse Effect. The businesses of the Company and its Subsidiaries, if any, are
not being conducted, and shall not be conducted so long as the Buyer owns any of the Securities, in violation of any law, ordinance
or regulation of any governmental entity. Except as specifically contemplated by this Agreement and as required under the 1933 Act
and any applicable state securities laws, the Company is not required to obtain any consent, authorization or order of, or make any
filing or registration with, any court, governmental agency, regulatory agency, self-regulatory organization or stock market or any
third party in order for it to execute, deliver or perform any of its obligations under this Agreement, the Note, and the Warrant in
accordance with the terms hereof or thereof or to issue and sell each of the Note and the Warrant in accordance with the terms
hereof and, upon conversion of the Note or exercise of the Warrant, issue Conversion Shares. All consents, authorizations, orders,
filings and registrations which the Company is required to obtain pursuant to the preceding sentence have been obtained or effected
on or prior to the date hereof. The Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to
any of the foregoing.

 

h. SEC
Documents; Financial Statements. The Company has timely filed all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended
(the “1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial
statements and schedules thereto and documents (other than exhibits to such documents) incorporated by reference therein, being
hereinafter referred to herein as the “SEC Documents”). As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable
to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading. None of the statements made in any such SEC
Documents is, or has been, required to be amended or updated under applicable law (except for such statements as have been amended
or updated in subsequent filings prior the date hereof). As of their respective dates, the financial statements of the Company
included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with United States
generally accepted accounting principles, consistently applied, during the periods involved and fairly present in all material
respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the
consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to
normal year-end audit adjustments). Except as set forth in the financial statements of the Company included in the SEC Documents,
the Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business
subsequent to May 31, 2022, and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not
required under generally accepted accounting principles to be reflected in such financial statements, which, individually or in the
aggregate, are not material to the financial condition or operating results of the Company. The Company is subject to the reporting
requirements of the 1934 Act. The Company has never been a “shell company” as described in Rule 144(i)(1)(i).

 

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i.
Absence of Certain Changes. Since May 31, 2022, there has been no material adverse change and no material adverse development
in the assets, liabilities, business, properties, operations, financial condition, results of operations, or 1934 Act reporting status
of the Company or any of its Subsidiaries.

 

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

 

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

 

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

 

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

 

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

 

o.
Disclosure. All information relating to or concerning the Company or any of its Subsidiaries set forth in this Agreement and provided
to the Buyer pursuant to the terms hereof and otherwise in connection with the transactions contemplated hereby is true and correct in
all material respects and the Company has not omitted to state any material fact necessary in order to make the statements made herein
or therein, in light of the circumstances under which they were made, not misleading. No event or circumstance has occurred or exists
with respect to the Company or any of its Subsidiaries or its or their business, properties, operations or financial conditions, which,
under applicable law, rule or regulation, requires public disclosure or announcement by the Company but which has not been so publicly
announced or disclosed (assuming for this purpose that the Company’s reports filed under the 1934 Act are being incorporated into
an effective registration statement filed by the Company under the 1933 Act).

 

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

 

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

 

r.
No Brokers. Other than the use of Sutter Securities, the Company has taken no action which would give rise to any claim by any
person for brokerage commissions, transaction fees or similar payments relating to this Agreement or the transactions contemplated hereby.

 

s. Permits;
Compliance. The Company and each of its Subsidiaries is in possession of all franchises, grants, authorizations, licenses,
permits, easements, variances, exemptions, consents, certificates, approvals and orders necessary to own, lease and operate its
properties and to carry on its business as it is now being conducted (collectively, the “Company Permits”), and there is
no action pending or, to the knowledge of the Company, threatened, regarding suspension or cancellation of any of the Company
Permits. Neither the Company nor any of its Subsidiaries is in conflict with, or in default or violation of, any of the Company
Permits, except for any such conflicts, defaults or violations which, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect. Since May 31, 2021, neither the Company nor any of its Subsidiaries has received any
notification with respect to possible conflicts, defaults or violations of applicable laws, except for notices relating to possible
conflicts, defaults or violations, which conflicts, defaults or violations would not have a Material Adverse Effect.

 

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t.
Environmental Matters.

 

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

 

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

 

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

 

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

 

v. Insurance.
The Company and each of its Subsidiaries are insured by insurers of recognized financial responsibility against such losses and
risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company
and its Subsidiaries are engaged. Neither the Company nor any such Subsidiary has any reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may
be necessary to continue its business at a cost that would not have a Material Adverse Effect. Upon written request the Company will
provide to the Buyer true and correct copies of all policies relating to directors’ and officers’ liability coverage,
errors and omissions coverage, and commercial general liability coverage.

 

    	9

     

    

 

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

 

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

 

y.
Solvency. The Company (after giving effect to the transactions contemplated by this Agreement) is solvent (i.e., its assets have
a fair market value in excess of the amount required to pay its probable liabilities on its existing debts as they become absolute and
matured) and currently the Company has no information that would lead it to reasonably conclude that the Company would not, after giving
effect to the transactions contemplated by this Agreement, have the ability to, nor does it intend to take any action that would impair
its ability to, pay its debts from time to time incurred in connection therewith as such debts mature. The Company’s financial
statements for its most recent fiscal year end and interim financial statements have been prepared assuming the Company will continue
as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

 

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

 

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

 

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

 

    	10

     

    

 

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

 

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

 

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

 

ff.
Breach of Representations and Warranties by the Company. The Company agrees that if the Company breaches any of the representations
or warranties set forth in this Section 3 and in addition to any other remedies available to the Buyer pursuant to this Agreement, it
will be considered an Event of Default under Section 3 of the Note.

 

4.
ADDITIONAL COVENANTS, AGREEMENTS AND ACKNOWLEDGEMENTS.

 

a.
[Intentionally Omitted].

 

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

 

    	11

     

    

 

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

 

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

 

e.
Listing. The Company, for so long as the Buyer owns any of the Securities, will maintain the listing and trading of its Common
Stock on the OTCQB or any equivalent replacement exchange or electronic quotation system (including but not limited to the Pink Sheets
electronic quotation system) (as applicable, the “Principal Market”) and will comply in all respects with the Company’s
reporting, filing and other obligations under the bylaws or rules of the Financial Industry Regulatory Authority (“FINRA”)
and such exchanges, as applicable. The Company shall promptly provide to the Buyer copies of any notices it receives from the Principal
Market and any other exchanges or electronic quotation systems on which the Common Stock is then traded regarding the continued eligibility
of the Common Stock for listing on such exchanges and quotation systems.

 

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

 

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

 

h.
Breach of Covenants. The Company acknowledges and agrees that if the Company breaches any of the covenants set forth in this Section
4, in addition to any other remedies available to the Buyer pursuant to this Agreement, it will be considered an Event of Default under
Section 3 of the Note.

 

    	12

     

    

 

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

 

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

 

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

 

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

 

    	13

     

    

 

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

 

n.
Right of Participation/Refusal in Subsequent Offerings.

 

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

 

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

 

    	14

     

    

 

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

 

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

 

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

 

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

 

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

 

o.
[Intentionally Omitted].

 

    	15

     

    

 

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

 

5.
Transfer Agent Instructions. The Company shall issue irrevocable instructions to the Company’s transfer agent to issue certificates,
registered in the name of the Buyer or its nominee, upon conversion of the Note, or the Warrant, the Conversion Shares, in such amounts
as specified from time to time by the Buyer to the Company in accordance with the terms thereof (the “Irrevocable Transfer Agent
Instructions”) as provided for at Exhibit D hereto. In the event that the Company proposes to replace its transfer agent,
the Company shall provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions
in a form as initially delivered pursuant to this Agreement (including but not limited to the provision to irrevocably reserved shares
of Common Stock in the Reserved Amount (as defined in the Note)) signed by the successor transfer agent to the Company and the Company.
Prior to registration of the Conversion Shares under the 1933 Act or the date on which the Conversion Shares may be sold pursuant to
any applicable exemption without any restriction as to the number of Securities as of a particular date that can then be immediately
sold, all such certificates shall bear the restrictive legend as specified in this Agreement. The Company warrants that: (i) no instruction
other than the Irrevocable Transfer Agent Instructions referred to in this Section 5 will be given by the Company to its transfer agent
and that the Securities shall otherwise be freely transferable on the books and records of the Company as and to the extent provided
in this Agreement, the Note, and the Warrant; (ii) it will not direct its transfer agent not to transfer or delay, impair, or hinder
its transfer agent in transferring (or issuing electronically or in certificated form) any certificate for Securities to be issued to
the Buyer upon conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; (iii) it will not
fail to remove (or directs its transfer agent not to remove or impairs, delays, or hinders its transfer agent from removing) any restrictive
legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any Securities issued to the Buyer upon
conversion of or otherwise pursuant to the Note as and when required by the Note and this Agreement; and (iv) it will provide any required
corporate resolutions and issuance approvals to its transfer agent within six (6) hours of each conversion of the Note. Nothing in this
Section shall affect in any way the Buyer’s obligations and agreement set forth herein to comply with all applicable prospectus
delivery requirements, if any, upon resale of the Securities. If the Buyer provides the Company, at the cost of the Company, with (A)
an opinion of counsel in form, substance and scope customary for opinions in comparable transactions, to the effect that a public sale
or transfer of such Securities may be made without registration under the 1933 Act and such sale or transfer is effected, or (B) the
Buyer provides reasonable assurances that the Securities can be sold pursuant to any applicable exemption, the Company shall permit the
transfer, and, in the case of the Securities, promptly instruct its transfer agent to issue one or more certificates, free from restrictive
legend, in such name and in such denominations as specified by the Buyer. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to the Buyer, by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly,
the Company acknowledges that the remedy at law for a breach of its obligations under this Section 5 may be inadequate and agrees, in
the event of a breach or threatened breach by the Company of the provisions of this Section, that the Buyer shall be entitled, in addition
to all other available remedies, to an injunction restraining any breach and requiring immediate transfer, without the necessity of showing
economic loss and without any bond or other security being required.

 

    	16

     

    

 

6.
Conditions to the Company’s Obligation to Sell. The obligation of the Company hereunder to issue and sell the Securities
to the Buyer at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions thereto,
provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion:

 

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

 

b.
The Buyer shall have delivered the Purchase Price in accordance with the terms herein.

 

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

 

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

 

7.
Conditions to The Buyer’s Obligation to Purchase. The obligation of the Buyer hereunder to purchase the Securities, on the
Closing Date, is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these
conditions are for the Buyer’s sole benefit and may be waived by the Buyer at any time in its sole discretion:

 

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

 

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

 

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

 

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

 

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

 

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

 

    	17

     

    

 

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

 

8.
Governing Law; Miscellaneous.

 

a.
Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without
regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated
by this Agreement, the Note, the Warrant, or any other agreement, certificate, instrument or document contemplated hereby shall be brought
only in the state courts of New York or in the federal courts located in the state of New York. The parties to this Agreement hereby
irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on
lack of jurisdiction or venue or based upon forum non conveniens. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE,
AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT
OR ANY TRANSACTIONS CONTEMPLATED HEREBY. The prevailing party shall be entitled to recover from the other party its reasonable attorneys’
fees and costs. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action
or proceeding in connection with this Agreement, the Note, or any other agreement, certificate, instrument or document contemplated hereby
or thereby by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service
of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner
permitted by law.

 

b.
Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of
which shall constitute one and the same agreement and shall become effective when counterparts have been signed by each party and delivered
to the other party. A facsimile or .pdf signature shall be considered due execution and shall be binding upon the signatory thereto with
the same force and effect as if the signature were an original, not a facsimile or .pdf signature. Delivery of a counterpart signature
hereto by facsimile or email/.pdf transmission shall be deemed validly delivery thereof.

 

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

 

d.
Severability. In the event that any provision of this Agreement, the Note, the Warrant, or any other agreement or instrument delivered
in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative
to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision
which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of this
Agreement, the Note, the Warrant, or any other agreement, certificate, instrument or document contemplated hereby or thereby.

 

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

 

    	18

     

    

 

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

 

If
to the Company, to:

 

SIMPLICITY
ESPORTS AND GAMING COMPANY

 

7000
West Palmetto Park Road, Suite 505

Boca Raton, Florida 33433

Attention:
Roman Franklin

e-mail:
roman@simplicityesports.com

 

If to the Buyer:

 

Pursuant
to the contact information in the subscription page below

 

g.
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and
assigns. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the
Buyer. Notwithstanding the foregoing, subject to the provisions hereof, the Buyer may assign its rights hereunder to any person that
purchases Securities in a private transaction from the Buyer or to any of its “affiliates,” as that term is defined under
the 1934 Act, without the consent of the Company.

 

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

 

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

 

j. Publicity.
The Company, and the Buyer shall have the right to review a reasonable period of time before issuance of any press releases, SEC,
Principal Market or FINRA filings, or any other public statements with respect to the transactions contemplated hereby; provided, however,
that the Company shall be entitled, without the prior approval of the Buyer, to make any press release or SEC, Principal Market (or
other applicable trading market) or FINRA filings with respect to such transactions as is required by applicable law and regulations
(although the Buyer shall be consulted by the Company in connection with any such press release prior to its release and shall be
provided with a copy thereof and be given an opportunity to comment thereon).

 

    	19

     

    

 

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

 

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

 

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

 

    	20

     

    

 

n.
Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by
vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company acknowledges that the remedy at law
for a breach of its obligations under this Agreement, the Note, or the Warrant will be inadequate and agrees, in the event of a breach
or threatened breach by the Company of the provisions of this Agreement, the Note, or the Warrant that the Buyer shall be entitled, in
addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or
injunctions restraining, preventing or curing any breach of this Agreement, the Note, or the Warrant and to enforce specifically the
terms and provisions hereof, without the necessity of showing economic loss and without any bond or other security being required. As
to any item not covered herein, the Buyers will have the right of set off with regard to the payment of the Purchase Price or any other
obligation that may become due by the Buyers and to the Company.

 

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

 

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

 

[SIGNATURE
PAGE FOLLOWS]

 

    	21

     

    

 

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

 

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

 

    	22

     

    

 

[PURCHASER
SIGNATURE PAGES TO SECURITIES PURCHASE AGREEMENT]

 

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

 

Name
of Purchaser: FIRSTFIRE GLOBAL OPPORTUNITIES FUND LLC

 

	/s/
    Eli Fireman	 
	Signature
    of Authorized Signatory of Purchaser:	 

 

Eli
Fireman

Name
of Authorized Signatory

 

eli@firstfirecap.com

Email
Address of Authorized Signatory

 

1040
First Avenue, Suite 190 New York, NY, 10022

Address for Notice to Purchaser

 

	Subscription Amount:	 	$	66,000.00	 
	Principal Amount:	 	$	60,000.00	 
	Warrant Shares:	 	 	120,000	 

 

EIN
Number: 47-3318295

 

    	23Exhibit
10.8

 

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

 

	 	Principal
    Amount: $66,000.00 	 	Issue
    Date: September 8, 2022 
	 	Actual
    Amount of Purchase Price: $60,000.00	 	 

 

CONVERTIBLE
PROMISSORY NOTE

 

FOR
VALUE RECEIVED, SIMPLICITY ESPORTS AND GAMING COMPANY, a Delaware
corporation (hereinafter called the “Borrower” or “Company”), hereby promises to pay to the order of FIRSTFIRE
GLOBAL OPPORTUNITIES FUND LLC, or registered assigns (the “Holder”), in the form of lawful money of the United States of
America, the principal sum of $66,000.00 (the “Principal Amount”) (subject to adjustment herein), with a purchase price of
$60,000.00 (the “Consideration”) plus an original issue discount in the amount of $6,000.00 (the “OID”), and
to pay interest on the Principal Amount under this Note at the rate of twelve percent (12%) (the “Interest Rate”) per annum
guaranteed from the date that the amount of Consideration is fully funded in accordance with the terms of this Note until the same becomes
due and payable, whether at maturity or upon acceleration or by prepayment or otherwise, as further provided herein; with the understanding
that $2,640.00 of interest shall be guaranteed and earned in full as of the Issue Date hereof. The
Holder shall pay the Consideration on the Issue Date as set forth above (the “Issue
Date”), and the outstanding principal amount under this Note shall be $66,000 (which includes the OID). The maturity date for this
Note shall be four (4) months from the Issue Date (“Maturity Date”), and is the date upon which the principal sum as well
as any accrued and unpaid interest and other fees shall be due and payable. Notwithstanding any other provision of this Note or any related
transaction documents, Borrower may prepay this Note only pursuant to Section 1.9 hereof.

 

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

 

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

 

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

 

    	1 

     

    

 

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

 

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

 

The
following terms shall apply to this Note:

 

Article
I. CONVERSION RIGHTS

 

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

 

    	2 

     

    

 

 

1.2
Conversion Price.

 

(a)
Calculation of Conversion Price. The per share
conversion price into which Principal Amount and interest (including any Default Interest) under this Note shall be convertible into
shares of Common Stock hereunder shall be $0.02 per share (the “Fixed Conversion Price”); provided however, that upon
failure to make any payment called for hereunder at any time after the Issue Date hereof, but prior to the Conversion Date, the Conversion
Price shall be determined in the future, unless such failure to make any payment called for hereunder is the failure to make such payment
on the Maturity Date, in which event the Conversion Price shall be equal to $0.01 (as applicable, the “Default Fixed Conversion
Price”). The Fixed Conversion Price or the Default Fixed Conversion Price, as applicable, is referred to as the “Conversion
Price”. To the extent the Conversion Price is below the par value per share, the Borrower will take all steps necessary to solicit
the consent of the stockholders to reduce the par value to the lowest value possible under law, provided however that the Borrower agrees
to honor all conversions submitted pending this decrease. If at any time the Conversion Price as determined hereunder for any conversion
would be less than the par value of the Common Stock, then at the sole discretion of the Holder, the Conversion Price hereunder may equal
such par value for such conversion and the Conversion Amount for such conversion may be increased to include Additional Principal, where
“Additional Principal” means such additional amount to be added to the Conversion Amount to the extent necessary
to cause the number of Conversion Shares issuable upon such conversion to equal the same number of Conversion Shares as would
have been issued had the Conversion Price not been adjusted by the Holder to the par value price.
In the event the Borrower has a DTC “Chill” on its shares, an additional discount of ten percent (10%) shall apply
to the Conversion Price while that “Chill” is in effect.

 

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

 

    	3 

     

    

 

1.3
Authorized and Reserved Shares. The Borrower
covenants that at all times until the Note is satisfied in full, the Borrower will reserve from its authorized and unissued Common Stock
a sufficient number of shares, free from preemptive rights, to provide for the issuance of a number of Conversion Shares equal to the
greater of: (a) 6,600,000 shares of Common Stock or (b) the sum of (i) the number of Conversion Shares issuable upon the full conversion
of this Note (assuming no payment of Principal Amount or interest) as of any issue date (taking into consideration any adjustments to
the Conversion Price pursuant to Section 2 hereof or otherwise) multiplied by (ii) three (3) (the “Reserved Amount”).
In the event that the Borrower shall be unable to reserve the entirety of the Reserved Amount (the “Reserve Amount Failure”),
the Borrower shall promptly take all actions necessary to increase its authorized share capital to accommodate the Reserved Amount (the
“Authorized Share Increase”), including without limitation, all board of directors actions and approvals and promptly calling
and holding a special meeting of its shareholders no more than sixty (60) days following the Reserve Amount Failure to seek approval
of the Authorized Share Increase via the solicitation of proxies. Notwithstanding the foregoing, in no event shall the Reserved Amount
be lower than the initial Reserved Amount, regardless of any prior conversions. The Borrower represents that upon issuance, the Conversion
Shares will be duly and validly issued, fully paid and non- assessable. In addition, if the Borrower shall issue any securities or make
any change to its capital structure which would change the number of Conversion Shares into which this Note shall be convertible at the
then current Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall be a sufficient
number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of this Note. The Borrower (i)
acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Conversion Shares or instructions to
have the Conversion Shares issued as contemplated by Section 1.4(f) hereof; and (ii) agrees that its issuance of this Note shall constitute
full authority to its officers and agents who are charged with the duty of executing stock certificates or cause the Borrower to electronically
issue shares of Common Stock to execute and issue the necessary certificates for the Conversion Shares or cause the Conversion Shares
to be issued as contemplated by Section 1.4(f) hereof in accordance with the terms and conditions of this Note.

 

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

 

1.4
Method of Conversion.

 

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

 

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

 

    	4 

     

    

 

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

 

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

 

    	5 

     

    

 

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

 

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

 

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

 

    	6 

     

    

 

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

 

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

 

1.6
Effect of Certain Events.

 

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

 

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

 

    	7 

     

    

 

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

 

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

 

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

 

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

 

(g)
[reserved]

 

    	8 

     

    

 

 

1.7
Adjustments to Conversion Price.

 

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

 

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

 

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

 

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

 

    	9 

     

    

 

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

 

Article
II. ARTICLE II. RANKING AND CERTAIN COVENANTS

 

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

 

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

 

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

 

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

 

    	10 

     

    

 

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

 

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

 

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

 

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

 

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

 

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

 

    	11 

     

    

 

Article
III. ARTICLE III. EVENTS OF DEFAULT

 

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

 

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

 

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

 

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

 

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

 

3.5
Judgments. Any money judgment, writ or similar
process shall be entered or filed against the Borrower or any subsidiary of the Borrower or any of its property or other assets for more
than $150,000.00, and shall remain unvacated, unbonded or unstayed for a period of twenty (20) days unless otherwise consented to by
the Holder, which consent will not be unreasonably withheld.

 

    	12 

     

    

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

    	13 

     

    

 

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

 

3.18
[Intentionally omitted].

 

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

 

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

 

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

 

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

 

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

 

3.24
[Intentionally omitted].

 

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

 

    	14 

     

    

 

Article
IV. MISCELLANEOUS

 

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

 

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

 

If
to the Borrower, to:

 

Article
V. SIMPLICITY ESPORTS AND GAMING COMPANY

 

7000
West Palmetto Park Road, Suite 505

Boca
Raton, Florida 33433

Attention:
Roman Franklin

e-mail:
roman@simplicityesports.com

 

If
to the Holder:

 

At
the address stated on the

signature
page to the

Securities
Purchase 

Agreement

 

 

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

 

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

 

    	15 

     

    

 

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

 

4.6 Governing
Law; Venue; Attorney’s Fees. This Note shall be governed by and construed in accordance with the laws of the State of
Delaware without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the
transactions contemplated by this Note or any other agreement, certificate, instrument or document contemplated hereby shall be
brought only in the state courts located in the state of New York or federal courts located in the state of New York. The Borrower
hereby irrevocably waives any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any
defense based on lack of jurisdiction or venue or based upon forum non conveniens. THE
BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY
TRANSACTIONS CONTEMPLATED HEREBY. Each party hereby irrevocably
waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this
Note or any other agreement, certificate, instrument or document contemplated hereby or thereby by mailing a copy thereof via
registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to
it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. The prevailing
party in any action or dispute brought in connection with this the Note or any other agreement, certificate, instrument or document
contemplated hereby or thereby shall be entitled to recover from the other party its reasonable attorney’s fees and
costs.

 

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

 

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

 

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

 

    	16 

     

    

 

4.10
Remedies. The Borrower acknowledges that a breach
by it of its obligations hereunder will cause irreparable harm to the Holder, by vitiating the intent and purpose of the transaction
contemplated hereby. Accordingly, the Borrower acknowledges that the remedy at law for a breach of its obligations under this Note will
be inadequate and agrees, in the event of a breach or threatened breach by the Borrower of the provisions of this Note, that the Holder
shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein,
to an injunction or injunctions restraining, preventing or curing any breach of this Note and to enforce specifically the terms and provisions
thereof, without the necessity of showing economic loss and without any bond or other security being required.

 

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

 

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

 

4.13
Severability. In the event that any provision
of this Note is invalid or unenforceable under any applicable statute or rule of law (including any judicial ruling), then such provision
shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or
rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability
of any other provision of this Note.

 

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

 

    	17 

     

    

 

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

 

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

 

[SIGNATURE
PAGE FOLLOWS]

 

    	18 

     

    

 

IN
WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer on September 8, 2022.

 

Article
VI. SIMPLICITY ESPORTS AND GAMING COMPANY

 

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

 

    	 

     

    

 

EXHIBIT
A -- NOTICE OF CONVERSION

 

The
undersigned hereby elects to convert $ __________ principal amount of the Note (defined below) into that number of shares of Common Stock
to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of SIMPLICITY ESPORTS AND GAMING
COMPANY, a Delaware corporation (the “Borrower”), according to the conditions of the Convertible Promissory Note of the
Borrower dated as of July 14, 2022 (the “Note”), as of the date written below. No fee will be charged to the Holder for any
conversion, except for transfer taxes, if

 

Box
Checked as to applicable instructions:

 

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

 

 __________________________________

 

 __________________________________

 

e-mail:_________________________________

 

Date
of Conversion:

        ________________________

Applicable
Conversion Price:    $ Costs Incurred by the Undersigned to

Convert
the Note into Shares of Common $ ______________________________Stock:

Number
of Shares of Common Stock to

be
Issued Pursuant to Conversion of the _______________________________ Note:

Amount
of Principal Balance Due remaining ___________________________

Under
the Note after this conversion:

 

By:_________________________________________________________________________________

Name:_______________________________________________________________________________

Title:________________________________________________________________________________

Date:________________________________________________________________________________

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