SECURITIES PURCHASE AGREEMENT

THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of November ___,
2016, is between Q BIOMED INC., a company incorporated under the laws of the
State of Nevada, with headquarters located at 501 Madison Ave, 14th Floor, New
York, NY, 10022 (the “Company”), and each of the investors listed on the
Schedule of Buyers attached hereto (individually, a “Buyer” and collectively the
“Buyers”).
WITNESSETH

WHEREAS, the Company and each Buyer desire to enter into this transaction for
the Company to sell and the Buyers to purchase the Convertible Debentures (as
defined below) pursuant to an exemption from registration pursuant to Section
4(2) and/or Rule 506 of Regulation D (“Regulation D”) as promulgated by the U.S.
Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933,
as amended (the “Securities Act”);
WHEREAS, the parties desire that, upon the terms and subject to the conditions
contained herein, the Company shall issue and sell to the Buyer(s), as provided
herein, and the Buyer(s) shall purchase up to $4,000,000 of secured convertible
debentures in the form attached hereto as “Exhibit A” (the “Convertible
Debentures”), which shall be convertible into shares of the Company’s common
stock, par value $0.001 (the “Common Stock”) (as converted, the “Conversion
Shares”), of which $1,500,000 shall be purchased upon the signing this agreement
(the “First Closing”), and $2,500,000 shall be purchased on or about the date
the Registration Statement has first been declared effective by the SEC (the
“Second Closing”) (individually referred to as a “Closing” collectively referred
to as the “Closings”), for a total purchase price of up to $4,000,000 (the
“Purchase Price”) in the respective amounts set forth opposite each Buyer(s)
name on Schedule I (the “Subscription Amount”);
WHEREAS, contemporaneously with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Registration Rights Agreement
(the “Registration Rights Agreement”) pursuant to which the Company has agreed
to provide certain registration rights under the Securities Act and the rules
and regulations promulgated there under, and applicable state securities laws;
WHEREAS, contemporaneously with the execution and delivery of this Agreement,
the Buyer, the Company, and each subsidiary of the Company are executing and
delivering a Security Agreement (all such security agreements shall be referred
to as the “Security Agreement”) pursuant to which the Company and its wholly
owned subsidiaries agree to provide the Buyer a security interest in Pledged
Property (as this term is defined in the Security Agreement);
WHEREAS, contemporaneously with the execution and delivery of this Agreement,
the parties hereto are executing and delivering Irrevocable Transfer Agent
Instructions (the “Irrevocable Transfer Agent Instructions”); and
WHEREAS, the Convertible Debentures and the Conversion Shares are collectively
referred to herein as the “Securities.”
AGREEMENT

NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and each Buyer hereby
agree as follows:
1.
PURCHASE AND SALE OF CONVERTIBLE DEBENTURES.

(a)
Purchase of Convertible Debentures.  Subject to the satisfaction (or waiver) of
the conditions set forth in Sections 6 and 7 below, the Company shall issue and
sell to each Buyer, and each Buyer severally, but not jointly, agrees to
purchase from the Company at each Closing Convertible Debentures in amounts
corresponding with the Subscription Amount set forth opposite each Buyer’s name
on Schedule of Buyers attached as Schedule I hereto. Solely with respect to the
Second Closing, in the event that the number of Conversion Shares registered for
resale by a Buyer on the Registration Statement multiplied by the average volume
weighted average price of the Common Stock on the Principal Market during the
five (5) consecutive Trading Days immediately prior to the effective date of the
Registration Statement is less than one and a half (1.5) times the sum of the
aggregate face value of Convertible Debentures purchased by the Buyer at the
First Closing which remain outstanding, and the aggregate face value of the
Convertible Debentures to be issued to the Buyer at the Second Closing (such
event shall be referred to as a “Coverage Failure”), then the amount of
Convertible Debentures to be issued and sold at the Second Closing to such Buyer
shall be reduced to the lowest amount which would not result in a Coverage
Failure, except if the Buyer waives such Coverage Failure. For the avoidance of
doubt, no adjustment shall be made to any Convertible Debentures previously
issued at the First Closing as a result in a Coverage Failure.

(b)
Closing Dates. Each Closing of the purchase of Convertible Debentures by the
Buyers shall occur at the offices Yorkville Advisors Global, LP, 1012
Springfield Avenue, Mountainside, NJ 07092. The date and time of each Closing
shall be as follows: (i) the First Closing shall be 10:00 a.m., New York time,
on the first (1st) Business Day on which the conditions to the Closing set forth
in Sections 6 and 7 below are satisfied or waived (or such other date as is
mutually agreed to by the Company and each Buyer) (the “First Closing Date”),
and (ii) the Second Closing shall be 10:00 a.m., New York time, on the first
(1st) Business Day after the date on which the Registration Statement is first
declared effective by the SEC, provided the conditions to the Closing set forth
in Sections 6 and 7 below are satisfied or waived (or such other date as is
mutually agreed to by the Company and each Buyer) (the “Second Closing Date” and
collectively referred to as the “Closing Dates”). As used herein “Business Day”
means any day other than a Saturday, Sunday or other day on which commercial
banks in New York, New York are authorized or required by law to remain closed.

(c)              
Form of Payment; Deliveries.  Subject to the satisfaction of the terms and
conditions of this Agreement, on each Closing Date, (i) the Buyers shall deliver
to the Company such aggregate proceeds for the Convertible Debentures to be
issued and sold to such Buyer at such Closing, minus the fees to be paid
directly from the proceeds of such Closing as set forth herein, and (ii) the
Company shall deliver to each Buyer, Convertible Debentures which such Buyer is
purchasing at such Closing in amounts indicated opposite such Buyer’s name on
Schedule I, duly executed on behalf of the Company.

2.
BUYER’S REPRESENTATIONS AND WARRANTIES.

Each Buyer, severally and not jointly, represents and warrants to the Company
with respect to only itself that, as of the date hereof and as of each Closing
Date:
(a)
Investment Purpose.  The Buyer is acquiring the Securities for its own account
for investment only and not with a view towards, or for resale in connection
with, the public sale or distribution thereof, except pursuant to sales
registered or exempted under the Securities Act; provided, however, that by
making the representations herein, such Buyer reserves the right to dispose of
the Securities at any time in accordance with or pursuant to an effective
registration statement covering such Securities or an available exemption under
the Securities Act. Such Buyer does not presently have any agreement or
understanding, directly or indirectly, with any Person to distribute any of the
Securities.

(b)
Accredited Investor Status.  The Buyer is an “Accredited Investor” as that term
is defined in Rule 501(a)(3) of Regulation D.

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

(d)
Information.  The Buyer and its advisors (and his or, its counsel), if any, have
been furnished with all materials relating to the business, finances and
operations of the Company and information he deemed material to making an
informed investment decision regarding his purchase of the Securities, which
have been requested by such Buyer. The Buyer and its advisors, if any, have been
afforded the opportunity to ask questions of the Company and its management.
Neither such inquiries nor any other due diligence investigations conducted by
such Buyer or its advisors, if any, or its representatives shall modify, amend
or affect such Buyer’s right to rely on the Company’s representations and
warranties contained in Section 3 below. The Buyer understands that its
investment in the Securities involves a high degree of risk. The Buyer has
sought such accounting, legal and tax advice, as it has considered necessary to
make an informed investment decision with respect to its acquisition of the
Securities.

(e)
Transfer or Resale.  The Buyer understands that: (i) the Securities have not
been registered under the Securities Act or any state securities laws, and may
not be offered for sale, sold, assigned or transferred unless (A) subsequently
registered thereunder, (B) such Buyer shall have delivered to the Company an
opinion of counsel, in a generally acceptable form, to the effect that such
Securities to be sold, assigned or transferred may be sold, assigned or
transferred pursuant to an exemption from such registration requirements, or (C)
such Buyer provides the Company with reasonable assurances (in the form of
seller and broker representation letters) that such Securities can be sold,
assigned or transferred pursuant to Rule 144 promulgated under the Securities
Act, as amended (or a successor rule thereto) (collectively, “Rule 144”), in
each case following the applicable holding period set forth therein; and (ii)
any sale of the Securities made in reliance on Rule 144 may be made only in
accordance with the terms of Rule 144 and further, if Rule 144 is not
applicable, any resale of the 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 Securities Act) may require
compliance with some other exemption under the Securities Act or the rules and
regulations of the SEC thereunder.

(f)
Legends.  The Buyer agrees to the imprinting, so long as its required by this
Section 2(f), of a restrictive legend on the Securities in substantially the
following form:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES HAVE BEEN ACQUIRED SOLELY FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TOWARD RESALE AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN
OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS.
Certificates evidencing the Conversion Shares shall not contain any legend
(including the legend set forth above), (i) while a registration statement
covering the resale of such security is effective under the Securities Act, (ii)
following any sale of such Conversion Shares pursuant to Rule 144, (iii) if such
Conversion Shares are eligible for sale under Rule 144, or (iv) if such legend
is not required under applicable requirements of the Securities Act (including
judicial interpretations and pronouncements issued by the staff of the SEC). The
Buyer agrees that the removal of restrictive legend from certificates
representing Securities as set forth in this Section 3(f) is predicated upon the
Company’s reliance that the buyer will sell any Securities pursuant to either
the registration requirements of the Securities Act, including any applicable
prospectus delivery requirements, or an exemption therefrom, and that if
Securities are sold pursuant to a registration statement, they will be sold in
compliance with the plan of distribution set forth therein.
(g)
Organization; Authority. Such Buyer is an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization with the requisite power and authority to enter into and to
consummate the transactions contemplated by the Transaction Documents (as
defined below) to which it is a party and otherwise to carry out its obligations
hereunder and thereunder.

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

(i)
No Conflicts. The execution, delivery and performance by such Buyer of this
Agreement and the consummation by such Buyer of the transactions contemplated
hereby will not (i) result in a violation of the organizational documents of
such Buyer, (ii) conflict with, or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which such Buyer is a party or (iii)
result in a violation of any law, rule, regulation, order, judgment or decree
(including federal and state securities laws) applicable to such Buyer, except,
in the case of clauses (ii) and (iii) above, for such conflicts, defaults,
rights or violations which could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the ability of such
Buyer to perform its obligations hereunder.

(j)
Certain Trading Activities. The Buyer has not directly or indirectly, nor has
any Person acting on behalf of or pursuant to any understanding with the Buyer,
engaged in any transactions in the securities of the Company (including, without
limitation, any Short Sales (as defined below) involving the Company's
securities) during the period commencing as of the time that the Buyer first
contacted the Company or the Company's agents regarding the specific investment
in the Company contemplated by this Agreement and ending immediately prior to
the execution of this Agreement by such Buyer. The Buyer hereby agrees that it
shall not directly or indirectly, engage in any Short Sales involving the
Company’s securities during the period commencing on the date hereof and ending
when no Convertible Debentures remain outstanding. "Short Sales" means all
"short sales" as defined in Rule 200 promulgated under Regulation SHO under the
1934 Act (as defined below). The Buyer is aware that Short Sales and other
hedging activities may be subject to applicable federal and state securities
laws, rules and regulations and the Buyer acknowledges that the responsibility
of compliance with any such federal or state securities laws, rules and
regulations is solely the responsibility of the Buyer.

3.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

Except as set forth under the corresponding section of the Disclosure Schedules
which Disclosure Schedules shall be deemed a part hereof and to qualify any
representation or warranty otherwise made herein to the extent of such
disclosure, the Company hereby makes the representations and warranties set
forth below to The Buyer:
(a)
Organization and Qualification. The Company and each of its Subsidiaries are
entities duly formed, validly existing and in good standing under the laws of
the jurisdiction in which they are formed, and have the requisite power and
authority to own their properties and to carry on their business as now being
conducted and as presently proposed to be conducted. The Company and each of its
Subsidiaries is duly qualified as a foreign entity to do business and is in good
standing in every jurisdiction in which its ownership of property or the nature
of the business conducted by it makes such qualification necessary, except to
the extent that the failure to be so qualified or be in good standing would not
reasonably be expected to have a Material Adverse Effect (as defined below). As
used in this Agreement, “Material Adverse Effect” means any material adverse
effect on  (i) the business, properties, assets, liabilities, operations
(including results thereof), condition (financial or otherwise) or prospects of
the Company and its Subsidiary, taken as a whole, (ii) the transactions
contemplated hereby or in any of the other Transaction Documents or any other
agreements or instruments to be entered into by the Company in connection
herewith or therewith or (iii) the authority or ability of  the Company to
perform any of its obligations under any of the Transaction Documents (as
defined below). “Subsidiaries” means any Person in which the Company, directly
or indirectly, owns a majority of the outstanding capital stock having voting
power or holds a majority of the equity or similar interest of such Person, and
each of the foregoing, is individually referred to herein as a “Subsidiary”.

(b)
Authorization; Enforcement; Validity. The Company has the requisite power and
authority to enter into and perform its obligations under this Agreement and the
other Transaction Documents and to issue the Securities in accordance with the
terms hereof and thereof. The execution and delivery of this Agreement and the
other Transaction Documents by the Company and the consummation by the Company
of the transactions contemplated hereby and thereby (including, without
limitation, the issuance of the Convertible Debentures, the reservation for
issuance and issuance of the Conversion Shares issuable upon conversion of the
Convertible Debentures, have been duly authorized by the Company's board of
directors and no further filing, consent or authorization is required by the
Company, its board of directors or its stockholders or other governmental body.
This Agreement has been, and the other Transaction Documents to which the
Company is a party will be prior to the Closing, duly executed and delivered by
the Company, and each constitutes the legal, valid and binding obligations of
the Company, enforceable against the Company in accordance with its respective
terms, except as such enforceability may be limited by general principles of
equity or applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the enforcement
of applicable creditors' rights and remedies and except as rights to
indemnification and to contribution may be limited by federal or state
securities law.  “Transaction Documents” means, collectively, this Agreement,
the Registration Rights Agreement, the Convertible Debentures, the Irrevocable
Transfer Agent Instructions, and each of the other agreements and instruments
entered into by the Company or delivered by the Company in connection with the
transactions contemplated hereby and thereby, as may be amended from time to
time.

(c)
Issuance of Securities. The issuance of the Convertible Debentures are duly
authorized and, upon issuance and payment in accordance with the terms of the
Transaction Documents the Convertible Debentures shall be validly issued, fully
paid and non-assessable and free from all preemptive or similar rights,
mortgages, defects, claims, liens, pledges, charges, taxes, rights of first
refusal, encumbrances, security interests and other encumbrances (collectively
“Liens”) with respect to the issuance thereof. As of the Closing, the Company
shall have reserved from its duly authorized capital stock not less than (i)
300% of the maximum number of shares of Common Stock issuable upon conversion of
all Convertible Debentures (assuming for purposes hereof that (x) such
Convertible Debentures are convertible at the Conversion Price (as defined
therein) as of the date of determination, (y) any such conversion shall not take
into account any limitations on the conversion of the Convertible Debentures set
forth therein). Upon issuance or conversion in accordance with the Convertible
Debentures, the Conversion Shares, when issued, will be validly issued, fully
paid and nonassessable and free from all preemptive or similar rights or Liens
with respect to the issue thereof, with the holders being entitled to all rights
accorded to a holder of Common Stock.

(d)
    No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, the issuance of
the Convertible Debentures, the Conversion Shares, and the reservation for
issuance of the Conversion Shares) will not (i) result in a violation of the
Articles of Incorporation (as defined below), Bylaws (as defined below),
certificate of formation, memorandum of association, articles of association,
bylaws or other organizational documents of the Company or any of its
Subsidiaries, or any capital stock or other securities of the Company or any of
its Subsidiaries, (ii) conflict with, or constitute a default  under, or give to
others any rights of termination, amendment, acceleration or cancellation of,
any agreement, indenture or instrument to which the Company or any of its
Subsidiaries is a party, or (iii) result in a violation of any law, rule,
regulation, order, judgment or decree (including, without limitation, U.S.
federal and state securities laws and regulations, the securities laws of the
jurisdictions of the Company's incorporation or in which it or its subsidiaries
operate and the rules and regulations of the OTC QB (the “Principal Market”) and
including all applicable laws, rules and regulations of the State of Nevada)
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 in
the case of (ii) and (iii) for any conflict, default, right or violation that
would not reasonably be expected to result in a Material Adverse Effect.

(e)
Consents. The Company is not required to obtain any material consent from,
authorization or order of, or make any filing or registration with (other than
any filings as may be required by any state securities agencies and any filings
as may be required by the Principal Market), any Governmental Entity (as defined
below) or any regulatory or self-regulatory agency or any other Person in order
for it to execute, deliver or perform any of its obligations under or
contemplated by the Transaction Documents, in each case, in accordance with the
terms hereof or thereof. All consents, authorizations, orders, filings and
registrations which the Company or any Subsidiary is required to obtain pursuant
to the preceding sentence have been or will be obtained or effected on or prior
to each Closing Date, and neither the Company nor any of its Subsidiaries are
aware of any facts or circumstances which might prevent the Company or any of
its Subsidiaries from obtaining or effecting any of the registration,
application or filings contemplated by the Transaction Documents. The Company is
not in violation of the requirements of the Principal Market and has no
knowledge of any facts or circumstances which could reasonably lead to delisting
or suspension of the Common Stock in the foreseeable future. The Company has
notified the Principal Market of the issuance of all of the Securities
hereunder, which does not require obtaining the approval of the stockholders of
the Company or any other Person or Governmental Entity, and the Principal Market
has completed its review of the related Listing of Additional Share form.
“Governmental Entity” means any nation, state, county, city, town, village,
district, or other political jurisdiction of any nature, federal, state, local,
municipal, foreign, or other government, governmental or quasi-governmental
authority of any nature (including any governmental agency, branch, department,
official, or entity and any court or other tribunal), multi-national
organization or body; or body exercising, or entitled to exercise, any
administrative, executive, judicial, legislative, police, regulatory, or taxing
authority or power of any nature or instrumentality of any of the foregoing,
including any entity or enterprise owned or controlled by a government or a
public international organization or  any of the foregoing.

(f)
Acknowledgment Regarding Buyer's Purchase of Securities. The Company
acknowledges and agrees that each Buyer is acting solely in the capacity of an
arm's length purchaser with respect to the Transaction Documents and the
transactions contemplated hereby and thereby and that no Buyer is (i) an officer
or director of the Company or any of its Subsidiaries, (ii) to its knowledge, an
"affiliate" (as defined in Rule 144 promulgated under the 1933 Act (or a
successor rule thereto) (collectively, “Rule 144”)) of the Company or any of its
Subsidiaries or (iii) to its knowledge, a “beneficial owner” of more than 10% of
the shares of  Common Stock (as defined for purposes of Rule 13d-3 of the 1934
Act). The Company further acknowledges that no Buyer is acting as a financial
advisor or fiduciary of the Company or any of its Subsidiaries (or in any
similar capacity) with respect to the Transaction Documents and the transactions
contemplated hereby and thereby, and any advice given by a Buyer or any of its
representatives or agents in connection with the Transaction Documents and the
transactions contemplated hereby and thereby is merely incidental to such
Buyer's purchase of the Securities. The Company further represents to each Buyer
that the Company's decision to enter into the Transaction Documents to which it
is a party has been based solely on the independent evaluation by the Company
and its representatives.

(g)
No Integrated Offering. None of the Company, its Subsidiaries or any of their
affiliates, nor any Person acting on their behalf has, directly or indirectly,
made any offers or sales of any security or solicited any offers to buy any
security, under circumstances that would cause this offering of the Securities
to require approval of stockholders of the Company under any applicable
stockholder approval provisions, including, without limitation, under the rules
and regulations of any exchange or automated quotation system on which any of
the securities of the Company are listed or designated for quotation. None of
the Company, its Subsidiaries, their affiliates nor any Person acting on their
behalf will take any action or steps that would cause the offering of any of the
Securities to be integrated with other offerings of securities of the Company.

(h)
Dilutive Effect. The Company understands and acknowledges that the number of
Conversion Shares will increase in certain circumstances. The Company further
acknowledges its obligation to issue the Conversion Shares upon conversion of
the Convertible Debentures in accordance with this Agreement and the Convertible
Debentures is, absolute and unconditional regardless of the dilutive effect that
such issuance may have on the ownership interests of other stockholders of the
Company.

(i)
Application of Takeover Protections; Rights Agreement. The Company and its board
of directors have taken all necessary action, if any, in order to render
inapplicable any control share acquisition, interested stockholder, business
combination, poison pill (including, without limitation, any distribution under
a rights agreement), stockholder rights plan or other similar anti-takeover
provision under the Articles of Incorporation, Bylaws or other organizational
documents or the laws of the jurisdiction of its incorporation or otherwise
which is or could become applicable to any Buyer as a result of the transactions
contemplated by this Agreement, including, without limitation, the Company's
issuance of the Securities and any Buyer's ownership of the Securities.

(j)
 SEC Documents; Financial Statements. During the two (2) years prior to the date
hereof, the Company has timely filed all reports, schedules, forms, proxy
statements, 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 and appendices included therein and financial
statements, notes and schedules thereto and documents incorporated by reference
therein being hereinafter referred to as the “SEC Documents”). The Company has
delivered or has made available to the Buyers or their respective
representatives true, correct and complete copies of each of the SEC Documents
not available on the EDGAR system. 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 the light of the circumstances under which they
were made, not misleading. As of their respective dates, the financial
statements of the Company included in the SEC Documents complied in all material
respects with applicable accounting requirements and the published rules and
regulations of the SEC with respect thereto as in effect as of the time of
filing. Such financial statements have been prepared in accordance with
generally accepted accounting principles (“GAAP”), consistently applied, during
the periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim
statements, to the extent they may exclude footnotes or may be condensed or
summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments which will not be
material, either individually or in the aggregate). The reserves, if any,
established by the Company or the lack of reserves, if applicable, are
reasonable based upon facts and circumstances known by the Company on the date
hereof and there are no loss contingencies that are required to be accrued by
the Statement of Financial Accounting Standard No. 5 of the Financial Accounting
Standards Board which are not provided for by the Company in its financial
statements or otherwise. No other information provided by or on behalf of the
Company to any of the Buyers which is not included in the SEC Documents
(including, without limitation, information in the disclosure schedules to this
Agreement) contains any untrue statement of a material fact or omits to state
any material fact necessary in order to make the statements therein not
misleading, in the light of the circumstance under which they are or were made.
The Company is not currently contemplating to amend or restate any of the
financial statements (including, without limitation, any notes or any letter of
the independent accountants of the Company with respect thereto) included in the
SEC Documents (the “Financial Statements”), nor is the Company currently aware
of facts or circumstances which would require the Company to amend or restate
any of the Financial Statements, in each case, in order for any of the
Financials Statements to be in compliance with GAAP and the rules and
regulations of the SEC. The Company has not been informed by its independent
accountants that they recommend that the Company amend or restate any of the
Financial Statements or that there is any need for the Company to amend or
restate any of the Financial Statements.

(k)
Absence of Certain Changes. Since the date of the Company's most recent audited
financial statements contained in a Form 10-K, there has been no material
adverse change and no material adverse development in the business, assets,
liabilities, properties, operations (including results thereof), condition
(financial or otherwise) or prospects of the Company or any of its Subsidiaries.
Since the date of the Company's most recent audited financial statements
contained in a Form 10-K, neither the Company nor any of its Subsidiaries has
(i) declared or paid any dividends, (ii) sold any material assets, individually
or in the aggregate, outside of the ordinary course of business or (iii) made
any material capital expenditures, individually or in the aggregate, outside of
the ordinary course of business. Neither the Company nor any of its Subsidiaries
has taken any steps to seek protection pursuant to any law or statute relating
to bankruptcy, insolvency, reorganization, receivership, liquidation or winding
up, nor does the Company or any Subsidiary have any knowledge or reason to
believe that any of their respective creditors intend to initiate involuntary
bankruptcy proceedings or any actual knowledge of any fact which would
reasonably lead a creditor to do so.

(l)
No Undisclosed Events, Liabilities, Developments or Circumstances. No event,
liability, development or circumstance has occurred or exists, or is reasonably
expected to exist or occur specific to the Company, any of its Subsidiaries or
any of their respective businesses, properties, liabilities, prospects,
operations (including results thereof) or condition (financial or otherwise),
that has not been publicly disclosed and would reasonably be expected to have a
Material Adverse Effect. For the avoidance of doubt, this section shall not
relate to any event, liability, development or circumstance that affects others
companies in the shipping industry.

(m)
Conduct of Business; Regulatory Permits. Neither the Company nor any of its
Subsidiaries is in violation of any term under its Articles of Incorporation,
any certificate of designation, preferences or rights of any other outstanding
series of preferred stock of the Company or any of its Subsidiaries or Bylaws or
their organizational charter, certificate of formation, memorandum of
association, articles of association, Articles of Incorporation or certificate
of incorporation or bylaws, respectively. Neither the Company nor any of its
Subsidiaries is in violation of any judgment, decree or order or any statute,
ordinance, rule or regulation applicable to the Company or any of its
Subsidiaries, and neither the Company nor any of its Subsidiaries will conduct
its business in violation of any of the foregoing, except in all cases for
violations which would not reasonably be expected to have a Material Adverse
Effect. Without limiting the generality of the foregoing, the Company is not in
violation of any of the rules, regulations or requirements of the Principal
Market and has no knowledge of any facts or circumstances that could reasonably
lead to delisting or suspension of the Common Stock by the Principal Market in
the foreseeable future. During the one year prior to the date hereof, (i) the
Common Stock has been listed or designated for quotation on the Principal
Market, (ii) trading in the Common Stock has not been suspended by the SEC or
the Principal Market and (iii) the Company has received no communication,
written or oral, from the SEC or the Principal Market regarding the suspension
or delisting of the Common Stock from the Principal Market, which has not been
publicly disclosed. The Company and each of its Subsidiaries possess all
certificates, authorizations and permits issued by the appropriate regulatory
authorities necessary to conduct their respective businesses, except where the
failure to possess such certificates, authorizations or permits would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, and neither the Company nor any of its Subsidiaries has received
any notice of proceedings relating to the revocation or modification of any such
certificate, authorization or permit. There is no agreement, commitment,
judgment, injunction, order or decree binding upon the Company or any of its
Subsidiaries or to which the Company or any of its Subsidiaries is a party which
has or would reasonably be expected to have the effect of prohibiting or
materially impairing any business practice of the Company or any of its
Subsidiaries, any acquisition of property by the Company or any of its
Subsidiaries or the conduct of business by the Company or any of its
Subsidiaries as currently conducted other than such effects, individually or in
the aggregate, which have not had and would not reasonably be expected to have a
Material Adverse Effect on the Company or any  of its Subsidiaries.

(n)
Foreign Corrupt Practices. Neither the Company nor any of its Subsidiaries nor
any director, officer, agent, employee, nor any other person acting for or on
behalf of the Company or any of its Subsidiaries (individually and collectively,
a “Company Affiliate”) have violated the U.S. Foreign Corrupt Practices Act (the
“FCPA) or any other applicable anti-bribery or anti- corruption laws, nor has
any Company Affiliate offered, paid, promised to pay, or authorized the payment
of any money, or offered, given, promised to give, or authorized the giving of
anything of value, to any officer, employee or any other person acting in an
official capacity for any Governmental Entity to any political party or official
thereof or to any candidate for political office (individually and collectively,
a “Government Official”) or to any person under circumstances where such Company
Affiliate knew or was aware of a high probability that all or a portion of such
money or thing of value would be offered, given or promised, directly or
indirectly, to any Government Official, for the purpose, in violation of
applicable law, of:  (i) (A) influencing any act or decision of such Government
Official in his/her official capacity, (B) inducing such Government Official to
do or omit to do any act in violation of his/her lawful duty, (C) securing any
improper advantage, or (D) inducing such Government Official to influence or
affect any act or decision of any Governmental Entity, or (ii) assisting the
Company or its Subsidiaries in obtaining or retaining business for or with, or
directing business to, the Company or its Subsidiaries.

(o)
Equity Capitalization.

(i)            
Definitions:

(A)
“Common Stock” means (x) the Company's shares of common stock, par value $0.001
per share, and (y) any capital stock into which such common stock shall have
been changed or any share capital resulting from a reclassification of such
common stock.

(B)
“Preferred Stock” means (x) the Company's blank check preferred stock, par value
$0.001 per share, the terms of which may be designated by the board of directors
of the Company in a statement of designations and (y) any capital stock into
which such preferred stock shall have been changed or any share capital
resulting from a reclassification of such preferred stock (other than a
conversion of such preferred stock into Common Stock in accordance with the
terms of such Certificate of Designations).

(ii)
Authorized and Outstanding Capital Stock. As of the date hereof, the authorized
capital stock of the Company consists of (A) 250,000,000 shares of Common Stock,
of which, 9,167,146 are issued and outstanding and (B) 100,000,000 shares of
Preferred Stock, none of which are issued and outstanding.

(iii)
Valid Issuance; Available Shares. All of such outstanding shares are duly
authorized and have been validly issued and are fully paid and nonassessable.

(iv)
Existing Securities; Obligations. Except as disclosed in the SEC Documents: (A)
none of the Company's or any Subsidiary's shares, interests or capital stock is
subject to preemptive rights or any other similar rights or Liens suffered or
permitted by the Company or any Subsidiary; (B) there are no outstanding
options, warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible into, or
exercisable or exchangeable for, any shares, interests or capital stock of the
Company or any of its Subsidiaries, or contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become
bound to issue additional shares, interests or capital stock of the Company or
any of its Subsidiaries or options, warrants, scrip, rights to subscribe to,
calls or commitments of any character whatsoever relating to, or securities or
rights convertible into, or exercisable or exchangeable for, any shares,
interests or capital stock of the Company or any of its Subsidiaries; (C) there
are no agreements or arrangements under which the Company or any of its
Subsidiaries is obligated to register the sale of any of their securities under
the 1933 Act (except pursuant to this Agreement); (D) there are no outstanding
securities or  instruments of the Company or any of its Subsidiaries which
contain any redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries; (E) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Securities; and (G) neither the Company nor any Subsidiary has any stock
appreciation rights or "phantom stock" plans or agreements or any similar plan
or agreement.

(v)
Organizational Documents. The Company has furnished to the Buyers or filed on
EDGAR true, correct and complete copies of the Company's Articles of
Incorporation, as amended and as in effect on the date hereof (the “Articles of
Incorporation”), and the Company's bylaws, as amended and as in effect on the
date hereof (the “Bylaws”), and the terms of all Convertible Securities and the
material rights of the holders thereof in respect thereto.

(p)
Litigation. Except as disclosed in the SEC Documents, there is no action, suit,
arbitration, proceeding, inquiry or investigation before or by the Principal
Market, any court, public board, other Governmental Entity, self-regulatory
organization or body pending or, to the knowledge of the Company, threatened
against or affecting the Company or any of its Subsidiaries, the Common Stock or
any of the Company's or its Subsidiaries' officers or directors, whether of a
civil or criminal nature or otherwise, in their capacities as such, which would
reasonably be expected to result in a Material Adverse Effect. After reasonable
inquiry of its employees, the Company is not aware of any event which might
result in or form the basis for any such action, suit, arbitration,
investigation, inquiry or other proceeding. Without limitation of the foregoing,
there has not been, and to the knowledge of the Company, there is not pending or
contemplated, any investigation by the SEC involving the Company, any of its
Subsidiaries or any current or former director or officer of the Company or any
of its Subsidiaries. Neither the Company nor any of its Subsidiaries is the
subject of any order, writ, judgment, injunction, decree, determination or award
of any Governmental Entity that would reasonably be expected to result in a
Material Adverse Effect.

(q)
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. In accordance
with the previous sentence, the Company currently maintains no insurance
policies. Neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for, and neither the Company nor any such
Subsidiary has any reason to believe that it will be unable 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.

(r)
Manipulation of Price. Neither the Company nor any of its Subsidiaries has, and,
to the knowledge of the Company, no Person acting on their behalf has, directly
or indirectly, (i) taken any action designed to cause or to result in the
stabilization or manipulation of the price of any security of the Company or any
of its Subsidiaries 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 or any of its Subsidiaries.

(s)
Registration Eligibility.  The Company is eligible to register the resale of the
Conversion Shares by the Buyers using Form S-1 promulgated under the 1933 Act.

(t)
Shell Company Status. The Company is not, but was until January 8, 2016, an
issuer identified in, or subject to, Rule 144(i).

(u)          
Money Laundering.   The Company and its Subsidiaries are in compliance with, and
have not previously violated, the USA Patriot Act of 2001 and all other
applicable U.S. and non-U.S. anti-money laundering laws and regulations,
including, but not limited to, the laws, regulations and Executive Orders and
sanctions programs (“Sanctions Programs”) administered by the U.S. Office of
Foreign Assets Control (“OFAC”), including, without limitation, (i) Executive
Order 13224 of September 23, 2001 entitled, "Blocking Property and  Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism"
(66 Fed. Reg. 49079 (2001)); and any regulations contained in 31 CFR, Subtitle
B, Chapter V.

(v)
Disclosure. The Company confirms that neither it nor any other Person acting on
its behalf has provided any of the Buyers or their agents or counsel with any
information that constitutes or could reasonably be expected to constitute
material, non- public information concerning the Company or any of its
Subsidiaries, other than the existence of the transactions contemplated by this
Agreement and the other Transaction Documents. The Company understands and
confirms that each of the Buyers will rely on the foregoing representations in
effecting transactions in securities of the Company. All disclosure provided to
the Buyers regarding the Company and its Subsidiaries, their businesses and the
transactions contemplated hereby, including the schedules to this Agreement,
furnished by or on behalf of the Company or any of its Subsidiaries, taken as a
whole, is true and correct and does not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading. All of the written information furnished after the date
hereof by or on behalf of the Company or any of its Subsidiaries to each Buyer
pursuant to or in connection with this Agreement and the other Transaction
Documents, taken as a whole, will be true and correct in all material respects
as of the date on which such information is so provided and will not contain any
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading. No event or circumstance has
occurred or information exists with respect to the Company or any of its
Subsidiaries or its or their business, properties, liabilities, prospects,
operations (including results thereof) or conditions (financial or otherwise),
which, under applicable law, rule or regulation, requires public disclosure at
or before the date hereof or announcement by the Company but which has not been
so publicly disclosed. All financial projections and forecasts that have been
prepared by or on behalf of the Company or any of its Subsidiaries and made
available to the Buyers have been prepared in good faith based upon reasonable
assumptions and represented, at the time each such financial projection or
forecast was delivered to each Buyer, the Company's best estimate of future
financial performance (it being recognized that such financial projections or
forecasts are not to be viewed as facts and that the actual results during the
period or periods covered by any such financial projections or forecasts may
differ from the projected or forecasted results). The Company acknowledges and
agrees that no Buyer makes or has made any representations or warranties with
respect to the transactions contemplated hereby other than those specifically
set forth in Section 2.

(w)
No General Solicitation.  Neither the Company, nor any of its affiliates, nor
any Person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) in connection with the offer or sale of the Securities.

(x)          
Private Placement. Assuming the accuracy of the Buyers’ representations and
warranties set forth in Section 2, no registration under the Securities Act is
required for the offer and sale of the Securities by the Company to the Buyers
as contemplated hereby. The issuance and sale of the Securities hereunder does
not contravene the rules and regulations of the Primary Market.

4.
COVENANTS.

(a)            Reporting Status. Until the date on which the Buyers shall have
sold all of the Underlying Securities, as defined below, (the “Reporting
Period”), the Company shall timely file all reports required to be filed with
the SEC pursuant to the 1934 Act, and the Company shall not terminate its status
as an issuer required to file reports under the 1934 Act even if the 1934 Act or
the rules and regulations thereunder would no longer require or otherwise permit
such termination.
(b)            Use of Proceeds. The Company will use the proceeds from the sale
of the Securities hereunder for working capital and other general corporate
purposes. Neither the Company nor any Subsidiary will, directly or indirectly,
use the proceeds of the transactions contemplated herein, or lend, contribute,
facilitate or otherwise make available such proceeds to any Person (i) to fund,
either directly or indirectly, any activities or business of or with any Person
that is identified on the list of Specially Designated Nationals and Blocker
Persons maintained by OFAC, or in any country or territory, that, at the time of
such funding, is, or whose government is, the subject of Sanctions Programs, or
(ii) in any other manner that will result in a violation of Sanctions Programs.
(c)            Listing. The Company shall promptly secure the listing or
designation for quotation (as the case may be) of all of the Underlying
Securities (as defined below) upon each national securities exchange and
automated quotation system, if any, upon which the Common Stock is then listed
or designated for quotation (as the case may be) (subject to official notice of
issuance) and shall maintain such listing or designation for quotation (as the
case may be) of all Underlying Securities from time to time issuable under the
terms of the Transaction Documents on such national securities exchange or
automated quotation system. The Company shall maintain the Common Stock’s
listing or authorization for quotation (as the case may be) on the Principal
Market, The New York Stock Exchange, the NYSE MKT, the Nasdaq Global Market, the
Nasdaq Global Select Market, the OTCQX or the OTCQB (each, an “Eligible
Market”). Neither the Company nor any of its Subsidiaries shall take any action
which could be reasonably expected to result in the delisting or suspension of
the Common Stock on an Eligible Market. The Company shall pay all fees and
expenses in connection with satisfying its obligations under this Section 4(i).
“Underlying Securities” means the (i) the Conversion Shares, and (ii) any common
stock of the Company issued or issuable with respect to the Conversion Shares,
including, without limitation, (1) as a result of any stock split, stock
dividend, recapitalization, exchange or similar event or otherwise and (2)
shares of capital stock of the Company into which the shares of Common Stock are
converted or exchanged without regard to any limitations on conversion of the
Convertible Debentures.
(d)            Fees. The Company shall pay to YA Global II SPV, LLC, an
affiliate of the lead Buyer (the “Subsidiary Fund”) a monitoring fee in the
amount of 5% of the Purchase Price of each Closing (collectively, the
“Monitoring Fees”) as compensation for the monitoring and managing of the
purchase and investments made by the Buyers described.
(e)            Pledge of Securities. Notwithstanding anything to the contrary
contained in this Agreement, the Company acknowledges and agrees that the
Securities may be pledged by an Investor in connection with a bona fide margin
agreement or other loan or financing arrangement that is secured by the
Securities. The pledge of Securities shall not be deemed to be a transfer, sale
or assignment of the Securities hereunder, and no Investor effecting a pledge of
Securities shall be required to provide the Company with any notice thereof or
otherwise make any delivery to the Company pursuant to this Agreement or any
other Transaction Document. The Company hereby agrees to execute and deliver
such documentation as a pledgee of the Securities may reasonably request in
connection with a pledge of the Securities to such pledgee by a Buyer.
(f)            Disclosure of Transactions and Other Material Information.  The
Company shall, on or before 9:30 a.m., New York time, on the first (1st)
Business Day after the date of this Agreement, issue a press release (the “Press
Release”) reasonably acceptable to the Buyers disclosing all the material terms
of the transactions contemplated by the Transaction Documents. On or before 9:30
a.m., New York time, on the first (1st) Business Day after the date of this
Agreement, the Company shall file a Report of Foreign Issuer on Form 8-K
describing all the material terms of the transactions contemplated by the
Transaction Documents in the form required by the 1934 Act and attaching all the
material Transaction Documents (including, without limitation, this Agreement
(and all schedules to this Agreement) and the form of Statement of Designations)
(including all attachments, the “8-K Filing”). From and after the filing of the
8-K Filing, the Company shall have disclosed all material, non-public
information (if any) provided to any of the Buyers by the Company or any of its
Subsidiaries or any of their respective officers, directors, employees or agents
in connection with the transactions contemplated by the Transaction Documents.
In addition, effective upon the filing of the 8-K Filing, the Company
acknowledges and agrees that any and all confidentiality or similar obligations
with respect to the transactions contemplated by the Transaction Documents 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 any of the Buyers or any of their
affiliates, on the other hand, shall terminate.  The Company shall not, and the
Company shall cause each of its Subsidiaries and each of its and their
respective officers, directors, employees and agents not to, provide any Buyer
with any material, non-public information regarding the Company or any of its
Subsidiaries from and after the date hereof without the express prior written
consent of such Buyer (which may be granted or withheld in such Buyer's sole
discretion).
(g)                        Reservation of Shares. So long as any of the
Convertible Debentures remain outstanding, the Company shall take all action
necessary to at all times have authorized, and reserved for the purpose of
issuance, no less than 300% of the maximum number of shares of Common Stock
issuable upon conversion of all the Convertible Debentures then outstanding
(assuming for purposes hereof that (x) the Convertible Debentures are
convertible at the Conversion Price then in effect, and (y) any such conversion
shall not take into account any limitations on the conversion of the Convertible
Debentures) (the “Required Reserve  Amount”); provided that at no time shall the
number of shares of Common Stock reserved pursuant to this Section 4(g) be
reduced other than proportionally in connection with any conversion and/or
redemption, or reverse stock split. If at any time the number of shares of
Common Stock authorized and reserved for issuance is not sufficient to meet the
Required Reserved Amount, the Company will promptly take all corporate action
necessary to authorize and reserve a sufficient number of shares, including,
without limitation, calling a special meeting of stockholders to authorize
additional shares to meet the Company's obligations pursuant to the Transaction
Documents, in the case of an insufficient number of authorized shares, and
obtain stockholder approval of an increase in such authorized number of shares,
and voting the management shares of the Company in favor of an increase in the
authorized shares of the Company to ensure that the number of authorized shares
is sufficient to meet the Required Reserved Amount.
(h)                        Conduct of Business. The business of the Company and
its Subsidiaries shall not be conducted in violation of any law, ordinance or
regulation of any Governmental Entity, except where such violations would not
reasonably be expected to result, either individually or in the aggregate, in a
Material Adverse Effect.

5.
REGISTER; TRANSFER AGENT INSTRUCTIONS; LEGEND.

(a)            Register. The Company shall maintain at its principal executive
offices or with the Transfer Agent (or at such other office or agency of the
Company as it may designate by notice to each holder of Securities), a register
for the Convertible Debentures in which the Company shall record the name and
address of the Person in whose name the Convertible Debentures have been issued
(including the name and address of each transferee), the amount of Convertible
Debentures held by such Person, and the number of Conversion Shares issuable
upon conversion of the Convertible Debentures held by such Person. The Company
shall keep the register open and available at all times during business hours
for inspection of any Buyer or its legal representatives.
(b)                        Transfer Restrictions. The Securities may only be
disposed of in compliance with state and federal securities laws. In connection
with any transfer of Securities other than pursuant to an effective registration
statement or Rule 144, to the Company or to an Affiliate of a Buyer or in
connection with a pledge as contemplated herein, the Company may require the
transferor thereof to provide to the Company an opinion of counsel selected by
the transferor and reasonably acceptable to the Company, the form and substance
of which opinion shall be reasonably satisfactory to the Company, to the effect
that such transfer does not require registration of such transferred Securities
under the Securities Act. As a condition of transfer, any such transferee shall
agree in writing to be bound by the terms of this Agreement and shall have the
rights and obligations of a Buyer under this Agreement.

6.            
CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.

The obligation of the Company hereunder to issue and sell the Convertible
Debentures to each Buyer at each Closing is subject to the satisfaction, at or
before each Closing Date, of each of the following conditions, provided that
these conditions are for the Company's sole benefit and may be waived by the
Company at any time in its sole discretion by providing each Buyer with prior
written notice thereof:

(a)            Such Buyer shall have executed each of the Transaction Documents
to which it is a party and delivered the same to the Company.
(b)            Such Buyer and each other Buyer shall have delivered to the
Company the Purchase Price (less, in the case of any Buyer, the amounts withheld
pursuant to Section 4(d)) for the Convertible Debentures being purchased by such
Buyer at the Closing by wire transfer of immediately available funds in
accordance with the Closing Statement.
(c)            The representations and warranties of such Buyer shall be true
and correct in all material respects as of the date when made and as of each
Closing Date as though originally made at that time (except for representations
and warranties that speak as of a specific date, which shall be true and correct
as of such specific date), and such 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 such
Buyer at or prior to such Closing Date.
7.
CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE.

The obligation of each Buyer hereunder to purchase its Convertible Debentures at
each Closing is subject to the satisfaction, at or before each Closing Date, of
each of the following conditions, provided that these conditions are for each
Buyer's sole benefit and may be waived by such Buyer at any time in its sole
discretion by providing the Company with prior written notice thereof:
(a)            The Company shall have duly executed and delivered to such Buyer
each of the Transaction Documents to which it is a party and the Company shall
have duly executed and delivered to such Buyer such aggregate amount of
Convertible Debentures as is set forth opposite such Buyer's name in column (b)
of the Schedule of Buyers for each Closing.
(b)            Such Buyer shall have received the opinion of Ortoli Rosenstadt
LLP, the Company's counsel, dated as of the First Closing Date, in the form
reasonably acceptable to such Buyer.
(c)            The Company shall have delivered to such Buyer a certificate
evidencing the incorporation and good standing of the Company issued by the
Registrar for the State of the Nevada as of a date within ten (10) days of the
Closing Date.
(d)            Each and every representation and warranty of the Company shall
be true and correct in all material respects (other than representations and
warranties qualified by materiality, which shall be true and correct in all
respects) as of the date when made and as of each Closing Date as though
originally made at that time (except for representations and warranties that
speak as of a specific date, which shall be true and correct as of such specific
date) and the Company shall have performed, satisfied and complied in all
respects with the covenants, agreements and conditions required to be performed,
satisfied or complied with by the Company at or prior to each Closing Date, as
set forth in section 3 and 4.
(e)            The Common Stock (A) shall be designated for quotation or listed
(as applicable) on the Principal Market and (B) shall not have been suspended,
as of each Closing Date, by the SEC or the Principal Market from trading on the
Principal Market nor shall suspension by the SEC or the Principal Market have
been threatened, as of each Closing Date,  either (I) in writing by the SEC or
the Principal Market or (II) by falling below the minimum maintenance
requirements of the Principal Market.
(f)            The Company shall have obtained all governmental, regulatory or
third party consents and approvals, if any, necessary for the sale of the
Securities, including without limitation, those required by the Principal
Market, if any.
(g)            No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any
court or Governmental Entity of competent jurisdiction that prohibits the
consummation of any of the transactions contemplated by the Transaction
Documents.
(h)            Since the date of execution of this Agreement, no event or series
of events shall have occurred that has resulted in or would reasonably be
expected to result in a Material Adverse Effect.
(i)            The Company shall have obtained approval of the Principal Market
to list or designate for quotation (as the case may be) the Conversion Shares,
if applicable.
(j)            Such Buyer shall have received a letter, duly executed by an
officer of the Company, setting forth the wire amounts of each Buyer and the
wire transfer instructions of the Company (the “Closing Statement”).
(k)            From the date hereof to the Closing Date, (i) trading in the
Common Stock shall not have been suspended by the SEC or the Principal Market
(except for any suspension of trading of limited duration agreed to by the
Company, which suspension shall be terminated prior to the Closing), (ii) the
closing price of the Common Stock on each such day shall have been above the
Floor Price (as defined in the Convertible Debentures), and (iii) at any time
prior to the Closing Date, trading in securities generally as reported by
Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall
not have been established on securities whose trades are reported by such
service, or on the Principal Market, nor shall a banking moratorium have been
declared either by the United States or New York State authorities nor shall
there have occurred any material outbreak or escalation of hostilities or other
national or international calamity of such magnitude in its effect on, or any
material adverse change in, any financial market which, in each case, in the
reasonable judgment of each Buyer, makes it impracticable or inadvisable to
purchase the Securities at the Closing.
(l)            The Company and its Subsidiaries shall have delivered to such
Buyer such other documents, instruments or certificates relating to the
transactions contemplated by this Agreement as such Buyer or its counsel may
reasonably request.
(m)            Solely with respect to the Second Closing the Registration
Statement shall be effective.
(n)            Solely with respect to the Second Closing, the issuance and sale
of the Convertible Debentures to the Buyer shall not cause a Coverage Failure,
and if the Second Closing shall cause a Coverage Failure then the amount of the
Convertible Debentures to be issued and sold at the Second Closing to such Buyer
shall be reduced to the lowest amount of Convertible Debentures which would not
result in a Coverage Failure, except if the Buyer waives such Coverage Failure.
8.
TERMINATION.

In the event that the first Closing shall not have occurred with respect to a
Buyer within five (5) days of the date hereof, then such Buyer shall have the
right to terminate its obligations under this Agreement with respect to itself
at any time on or after the close of business on such date without liability of
such Buyer to any other party; provided, however, (i) the right to terminate
this Agreement under this Section 8 shall not be available to such Buyer if the
failure of the transactions contemplated by this Agreement to have been
consummated by such date is the result of such Buyer's breach of this Agreement
and (ii) the abandonment of the sale and purchase of the Convertible Debentures
shall be applicable only to such Buyer providing such written notice, provided
further that no such termination shall affect any obligation of the Company
under this Agreement to reimburse such Buyer for the expenses described herein.
Nothing contained in this Section 8 shall be deemed to release any party from
any liability for any breach by such party of the terms and provisions of this
Agreement or the other Transaction Documents or to impair the right of any party
to compel specific performance by any other party of its obligations under this
Agreement or the other Transaction Documents.

9.
MISCELLANEOUS.

(a)            Governing Law; Jurisdiction; Jury Trial. All questions concerning
the construction, validity, enforcement and interpretation of this Agreement
shall be governed by the internal laws of the State of New York, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of New York or any other jurisdictions) that would cause the application
of the laws of any jurisdictions other than the State of New York. The Company
hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or under any of
the other Transaction Documents or with any transaction contemplated hereby or
thereby, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such 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 manner permitted by law.
Nothing contained herein shall be deemed or operate to preclude any Buyer from
bringing suit or taking other legal action against the Company in any other
jurisdiction to collect on the Company's obligations to such Buyer or to enforce
a judgment or other court ruling in favor of such Buyer. EACH PARTY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY
TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER
TRANSACTION DOCUMENT OR  IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT,
ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR
THEREBY.
(b)            Counterparts. This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party. In the event that any signature is
delivered by facsimile transmission or by an e-mail which contains a portable
document format (.pdf) file of an executed signature page, such signature page
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) with the same force and effect as if such
signature page were an original thereof.
(c)            Headings; Gender. The headings of this Agreement are for
convenience of reference and shall not form part of, or affect the
interpretation of, this Agreement. Unless the context clearly indicates
otherwise, each pronoun herein shall be deemed to include the masculine,
feminine, neuter, singular and plural forms thereof. The terms "including,"
"includes," "include" and words of like import shall be construed broadly as if
followed by the words "without limitation." The terms "herein," "hereunder,"
"hereof" and words of like import refer to this entire Agreement instead of just
the provision in which they are found.
(d)            Entire Agreement, Amendments.  This Agreement supersedes all
other prior oral or written agreements between the Buyer, the Company, their
affiliates and persons acting on their behalf with respect to the matters
discussed herein, and this Agreement and the instruments referenced herein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor any Buyer makes any representation, warranty,
covenant or undertaking with respect to such matters.  No provision of this
Agreement may be waived or amended other than by an instrument in writing signed
by the party to be charged with enforcement.
(e)            Notices. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party) or electronic mail; or (iii) one (1) Business
Day after deposit with an overnight courier service with next day delivery
specified, in each case, properly addressed to the party to receive the same.
The addresses, facsimile numbers and e-mail addresses for such communications
shall be:

If to the Company, to:
Q Biomed Inc.
 
c/o Ortoli Rosenstadt
501 Madison Avenue, 14th Floor
New York, NY 10022
Telephone:  212-588-0022
Facsimile:  212-826-9307
Attention:  William Rosenstadt
E-Mail:  wsr@or.legal
 
With Copy to:
Denis Corin
10 Market Street
Suite 427
Grand Cayman
KY1-9006
Cayman Islands
Email: dcorin@qbiomed.com
   
If to a Buyer, to its address, e-mail address and facsimile number set forth on
the Schedule of Buyers, with copies to such Buyer's representatives as set forth
on the Schedule of Buyers,
       
With copy to:
David Gonzalez, Esq.
c/o Yorkville Advisors Global, LP
1012 Springfield Avenue
Mountainside, NJ 07092
Fax: 201-985-8744
Email: legal@yorkvilleadvisors.com
   

or to such other address, e-mail address and/or facsimile number and/or to the
attention of such other Person as the recipient party has specified by written
notice given to each other party five (5) days prior to the effectiveness of
such change. Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender's facsimile machine or e-mail containing
the time, date, recipient facsimile number and, with respect to each facsimile
transmission, an image of the first page of such transmission or (C) provided by
an overnight courier service shall be rebuttable evidence of personal service,
receipt by facsimile or receipt from an overnight courier service in accordance
with clause (i), (ii) or (iii) above, respectively
(f)            Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns,
including any purchasers of any of the Convertible Debentures (but excluding any
purchasers of Underlying Securities, unless pursuant to a written assignment by
such Buyer). The Company shall not assign this Agreement or any rights or
obligations hereunder without the prior written consent of the Buyers. In
connection with any transfer of any or all of its Securities, a Buyer may assign
all, or a portion, of its rights and obligations hereunder in connection with
such Securities without the consent of the Company, in which event such assignee
shall be deemed to be a Buyer hereunder with respect to such transferred
Securities.
(g)            Indemnification.
(i)            In consideration of each Buyer's execution and delivery of the
Transaction Documents and acquiring the Securities thereunder and in addition to
all of the Company's other obligations under the Transaction Documents, the
Company shall defend, protect, indemnify and hold harmless each Buyer and each
holder of any Securities and all of their stockholders, partners, members,
officers, directors, employees and direct or indirect investors and any of the
foregoing Persons' agents or other representatives (including, without
limitation, those retained in connection with the transactions contemplated by
this Agreement) (collectively, the "Indemnitees") from and against any and all
actions, causes of action, suits, claims, losses, costs, penalties, fees,
liabilities and damages, and expenses in connection therewith (irrespective of
whether any such Indemnitee is a party to the action for which indemnification
hereunder is sought), and including reasonable attorneys' fees and disbursements
(the "Indemnified Liabilities"), incurred by any Indemnitee as a result of, or
arising out of, or relating to (i) any misrepresentation or breach of any
representation or warranty made by the Company in any of the Transaction
Documents, (ii) any breach of any covenant, agreement or obligation of the
Company or any Subsidiary contained in any of the Transaction Documents or (iii)
any cause of action, suit, proceeding 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 or any Subsidiary) or which otherwise involves
such Indemnitee that arises out of or results from (A) the execution, delivery,
performance or enforcement of any of the Transaction Documents, (B) 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 (C) any
disclosure properly made by such Buyer pursuant to Section 4(f), or (D) the
status of such Buyer or holder of the Securities either as an investor in the
Company pursuant to the transactions contemplated by the Transaction Documents
or as a party to this Agreement (including, without limitation, as a party in
interest or otherwise in any action or proceeding for injunctive or  other
equitable relief). To the extent that the foregoing undertaking by the Company
may be unenforceable for any reason, the Company shall make the maximum
contribution to the payment and satisfaction of each of the Indemnified
Liabilities which is permissible under applicable law.
(ii)            Promptly after receipt by an Indemnitee under this Section 9(g)
of notice of the commencement of any action or proceeding (including any
governmental action or proceeding) involving an Indemnified Liability, such
Indemnitee shall, if a claim in respect thereof is to be made against the
Company under this Section 9(g), deliver to the Company a written notice of the
commencement thereof, and the Company shall have the right to participate in,
and, to the extent the Company so desires, to assume control of the defense
thereof with counsel mutually reasonably satisfactory to the Company and the
Indemnitee; provided, however, that an Indemnitee shall have the right to retain
its own counsel with the fees and expenses of such counsel to be paid by the
Company if: (A) the Company has agreed in writing to pay such fees and expenses;
(B) the Company shall have failed promptly to assume the defense of such
Indemnified Liability and to employ counsel reasonably satisfactory to such
Indemnitee in any such Indemnified Liability; or (C) the named parties to any
such Indemnified Liability (including any impleaded parties) include both such
Indemnitee and the Company, and such Indemnitee shall have been advised by
counsel that a conflict of interest is likely to exist if the same counsel were
to represent such Indemnitee and the Company (in which case, if such Indemnitee
notifies the Company in writing that it elects to employ separate counsel at the
expense of the Company, then the Company shall not have the right to assume the
defense thereof and such counsel shall be at the expense of the Company),
provided further, that in the case of clause (C) above the Company shall not be
responsible for the reasonable fees and expenses of more than one (1) separate
legal counsel for the Indemnitees. The Indemnitee shall reasonably cooperate
with the Company in connection with any negotiation or defense of any such
action or Indemnified Liability by the Company and shall furnish to the Company
all information reasonably available to the Indemnitee which relates to such
action or Indemnified Liability. The Company shall keep the Indemnitee
reasonably apprised at all times as to the status of the defense or any
settlement negotiations with respect thereto. The Company shall not be liable
for any settlement of any action, claim or proceeding effected without its prior
written consent, provided, however, that the Company shall not unreasonably
withhold, delay or condition its consent. The Company shall not, without the
prior written consent of the Indemnitee, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnitee of a release from all liability in respect to such Indemnified
Liability or litigation, and such settlement shall not include any admission as
to fault on the part of the Indemnitee. Following indemnification as provided
for hereunder, the Company shall be subrogated to all rights of the Indemnitee
with respect to all third parties, firms or corporations relating to the matter
for which indemnification has been made. The failure to deliver written notice
to the Company within a reasonable time of the commencement of any such action
shall not relieve the Company of any liability to the Indemnitee under this
Section 9(g), except to the extent that the Company is materially and adversely
prejudiced in its ability to defend such  action.
(iii)            The indemnification required by this Section 9(g) shall be made
by periodic payments of the amount thereof during the course of the
investigation or defense, within ten (10) days after bills supporting the
Indemnified Liabilities are received by the Company.
(iv)            The indemnity agreement contained herein shall be in addition to
(A) any cause of action or similar right of the Indemnitee against the Company
or others, and (B) any liabilities the Company may be subject to pursuant to the
law.
(h)            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.

[REMAINDER PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
COMPANY:
 
 
Q BIOMED INC.
     
By:       /s/Denis
Corin                                                                                    
 
Name:  Denis Corin
 
Title:    Chief Executive Officer
                                   

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IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.

 
BUYER:
 
 
 
YA II CD, LTD.
     
By:            Yorkville Advisors Global, LP
 
Its:            Investment Manager
     
       By:                          Yorkville Advisors Global LLC
 
       Its:                          General Partner
     
       By:                          /s/Matthew Beckman__________
 
       Name:        Matthew Beckman
 
       Title:          Manager

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LIST OF EXHIBITS:

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EXHIBIT A

FORM OF CONVERTIBLE DEBENTURES

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SCHEDULE OF BUYERS

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